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HomeMy WebLinkAbout2011 ERS Minutesi OFFFICAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting Council Conference Room 10th Floor, City Hall Lansing, MI January 20, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:35 a.m. Present: Trustees Dedic, McCaffery, Munroe (9:20 a.m.), Parker, Robinson, Singleton 5. Absent: Trustee Bernero, Kraus, Rose Others: Karen E. Williams, Finance Department; Attorney Jack Roberts, Attorney Kenneth Lane, Clark Hill Law Office (representing the Law Department); Brad Armstrong, Gabriel, Roeder, Smith and Company; Carol Wood, City Council. Ms. Williams distributed a posting from the Secretary of the Board to confirm the election of Carol Munroe as the new Parks Department Trustee. Ms. Williams reported that there was one valid nominating petition submitted to the Retirement Office. It was moved by Trustee McCaffery and supported by Trustee Singleton to certify the election of Carol Munroe as the new Parks Department Trustee. Adopted by the following vote: 5 — 0. Trustee Munroe was excused to get sworn in by the City Clerk. It was moved by Trustee McCaffery supported by Trustee Singleton to approve the Official Minutes of the Employees Retirement System Regular Meeting of December 16, 2011. Adopted by the following vote: 5 — 0. It was moved by Trustee Robinson and supported by Trustee Parker to approve the Regular Age & Service Retirement: Lois J. Hill (Police/Civilian — Teamster 580), 14 years, 4 months, age 58, effective January 1, 2011 (From Deferred) Approved by the following vote: 5 — 0. Regular Meeting Council Conference Room 10th Floor, City Hall Lansing, MI January 20, 2011 Thursday, 8:30 a.m. Page 2 It was moved by Trustee Parker and supported by Trustee Singleton to approve the following request for Refund of Accumulated Contributions: Francesca Hernandez, UAW, Public Service $3,677.92 Adopted by the following vote: 5 - 0 Ms. Williams reported to the Board that Trustee Rose requested an excuse from the Employees Retirement System meeting. It was moved by Trustee Parker and supported by Trustee Singleton to excuse Trustee Parker from the Employees Retirement System Board meeting of January 20, 2011. Adopted by the following vote: 5 - 0. Trustee Dedic requested permission to attend the Annual International Foundation of Employees Benefit Conference in November. It was moved by Trustee Singleton and supported by Trustee Robinson to allow the Chairperson to attend the Annual International Foundation Employees Benefit Conference in November. Adopted by the following vote: 5 - 0 It was moved by Trustee Robinson and supported by Trustee Singleton to grant permission for Trustees who would like to attend the Annual International Foundation Employees Benefit Conference in November. Adopted by the following vote: 5 — 0. Ms. Williams updated the Board on Case #2010E-1021. The non -duty disability applicant was seen and evaluated by the Board's Medical Director. The Medical Director requested clarification of the Employees Retirement System Ordinance's section regarding granting non -duty disability. The Retirement Office sent the Medical Director's request to the disability subcommittee for direction. Trustee Kraus requested that legal counsel review the Medical Director's inquiry and the Medical Director hold his report until the legal interpretation was given to the Board. Attorney Kenneth Lane opined that under the Employees Retirement System the Ordinance, you must be totally incapacitated in the employment of the City. The Ordinance is broadly written. Regular Meeting January 20, 2011 Council Conference Room Thursday, 8:30 a.m. 10th Floor, City Hall Lansing, MI Page 3 Attorney Jack Roberts asked and was granted permission to address the Board regarding Case #2010E-1021. Attorney Roberts reported to the Board that he reviewed the Medical Director's request and spoke with Attorney Ken Lane and Human Resources. Attorney Roberts stated the Human Resources stated the all the collective bargaining Contracts have a Humanitarian Clause for employees that become disabled, generally the "reasonable accommodations" provision. Attorney Roberts stated that the Board may need to interface with Human Resources to determine if there is another job available for a disability applicant within the City. Trustee Singleton stated that a disability applicant who wanted reasonable accommodations could request this from the City. Trustee Singleton reported that by law, the City has an administrative internal process to meet the request. However, the request could not come from the Medical Director. Attorney Lane stated that the issue as defined by the Attorney Roberts, is that the Medical Director has the Ordinance's broad definition to evaluated disability status. As an example, the Medical Director may state that an applicant may not be able to do a labor position, but the applicant could perform another duty within the City and therefore is not considered disabled by the Retirement Ordinance. The disability applicant cannot be forced to take a reasonable accommodation and the Board would have to concur with the Medical Director and deny the request to grant a disability retirement. Attorney Roberts suggested that the Board should determine how it would like the Medical Director to interface with Human Resources for disability evaluations. Trustee Singleton stated that an applicant could go to the treating physician and his diagnosis could conflict with the evaluating Medical Director. Trustee Singleton stated that an applicant if he chooses should go through the internal process first before the Medical Director can make an evaluation. Trustee Dedic inquired if an applicant can be evaluated for disability based on the specific position that have at the City. This, if a mechanic cannot perform his duties an as mechanic, is the applicant qualified for disability. Trustee Dedic inquired if the Ordinance can be amended on this section through collective bargaining or through City Council. Attorney Roberts reported to the Trustees that the Board cannot require an applicant to request reasonable accommodations. Trustee Dedic requested what actions can be taken. Regula,ir Meeting Council Conference Room 10th Floor, City Hall Lansing, MI J�nuary 20, 2011 Thursday, 8:30 a.m. Page 4 Attorney Roberts requested if the Board would allow the Medical Director could talk with Human Resources regarding the issue. Trustee Munroe returned to the meeting and inquired if an applicant who would like to work could be placed in another bargaining unit, if a suitable position can be found. Trustee Dedic requested that the matter be placed on pending and that the Medical Director should contact the Human Resources Director regarding the applicant. Attorney Jack Roberts also reported to the Board that he is preparing a response to Mr. John Salmons, who requested an Ordinance amendment that would allow a retiree to change his beneficiary post retirement. There were no public comments for items on the Agenda. Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 0 retired. Total active membership: 509. Total deferred: 50. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of December, 2010 amounted to $1,656,996.98. Total retirement checks printed for the ERS System: 843. 1 death(s) Sandra T. Unrue, died 12/29/2010, (T580 CTP — retired 1/30/1991, age 76, beneficiary to receive 100%. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. There were no Requests for Duty Disability Retirement. There were no public comments for items not on the Agenda. Mr. Brad Armstrong, Gabriel, Roeder, Smith and Company presented City of Lansing Employees' Retirement System Actuarial Valuation Report, December 31, 2009. Mr. Brad Armstrong provided an overview of the Ordinance and the purpose of the actuary report for new trustees. Mr. Armstrong discussed the valuation results, the summary of benefits provisions and valuation, financial principles, and disclosures required by the Governmental Accounting Standards Board. Mr. Armstrong reviewed the computed City contributions to the Employees Retirement System and percentages of payroll. He also reviewed the Schedule of Employer Contributions and projects of future contributions. Ms. Carol Wood inquired about the Board's five-year smoothing schedule. Mr. Armstrong discussed the five year smoothing schedule for financial reporting. Regular Meeting Council Conference Room 10th Floor, City Hall Lansing, MI January 20; 2011 Thursday,8:30 a.m. Page 5 It was moved by Trustee Robinson and supported by Trustee Parker to receive the Employees Retirement System Actuarial Report, December 31, 2009 Adopted by the following vote: 5 -0. Mr. Armstrong also the discussed with the Board the preparation of an updated Actuarial Experience Study for the Employees Retirement System Board. Mr. Armstrong also informed the Board that Gabriel, Roeder, Smith and Company does provide and host pension software. Trustee Parker inquired regarding the factors used to calculate purchase of time. Mr. Armstrong provided an explanation of some of the factors used when calculating credited service time purchases. Ms. Williams updated the Board that the Investment Subcommittee met regarding the Small/SMid Cap Manager Search. The subcommittee decided to meet jointly Tuesday, February 8, 2011 to interview managers. Ms. Williams will distribute an agenda when she receives the manager list and interview times from Asset Consulting Group. Ms. Williams updated the Board regarding Pension Software. The Project manager prepared a Request for Information that was mailed to companies to get basic information on services and fees. The Project Manager will provide and analysis of the RFI that are due February 2, 2011 and would give a range of fees to the Board. The Project manager will also begin to prepare a Request for Proposal. The Joint Committee on Special Projects, Actuary Bid Process is pending. Attorney Kenneth Lane reported that Employees Retirement System Ordinance has been sent to the City Council for review. Ms Williams reviewed the Investment and Securities Lending Monthly report for December. The meeting adjourned at 10:39 a.m. Minutes approved on Jerry Ambrose, Secretary Employees Retirement System Scott Dedic, Chairperson Employees Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting Council Conference Room 10th Floor, City Hall Lansing, MI February 17, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:35 a.m. Present: Dedic, Kraus, McCaffery, Munroe, Parker, Rose, Singleton (8:41)- 6 Absent: Trustee Bernero, Robinson Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office). It was moved by Trustee McCaffery and supported by Trustee Munroe to approve the Official minutes of the Employees Retirement System Regular Meeting of January 20, 2011. Adopted by the following vote: unanimously There were no public comments for items on the agenda. Secretary's Report. 1 new member(s), 0 reinstatement(s), 0 refunds(s), 0 transfers, 0 retired. Total active membership: 510. Total deferred: 50. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of January, 2011 amounted to $1,669,537. Total retirement checks printed for the ERS System: 8456. 0 death(s). Domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. There were no Requests for Regular Age and Service Retirements. There were no requests for duty disability retirements. Ms. Williams reported that Dr. Roth has requested direction on the application of non - duty ordinance regarding non -duty applicant E2010-1021. Attorney Lane reviewed a disability policy adopted by the Board in 1989. The existing policy indicates that once the doctor report is received, the Human Resources department would have 120 days to review a list of available jobs that the applicant can perform. Employees Retirement System Regular Meeting of February 17, 2011 Page 2 Attorney Ken Lane provided to the Board an amended policy for duty disability that would allow the Retirement Office to contact the Human Resources prior to the doctor's report so that the available positions could be review. The Board reviewed the doctor's request and agreed that the Retirement Office should retrieve a list of available jobs that the doctor can review to determine if the applicant can perform those duties. There were no Requests for Refunds of Accumulated Contributions. Trustee Robert Rose provided a report of the MAPERS One Day Conference. Trustee Rose discussed the Securities Litigation and Fraud monitoring session. Trustee Rose reported that members met and talked with Gordie Howe. Trustee Rose also enjoyed the session regarding non-verbal communication. Trustee Parker found the Round Table on asset allocation informative. He reported information regarding global equities and the basket clause. Attorney Ken Lane reviewed the state legislative that would amend Public Act 314. Karen Williams distributed the registration material for the Spring MAPERS that will be held May 1 — 3. Ms. Williams requested that registration be completed and forwarded to the Retirement Office. Karen Williams also distributed information regarding the International Foundation Annual Conference. It was moved by Trustee Rose and supported by Trustee McCaffery to discharge Northpointe as of March 31, 2011 and move assets to William Blair. Trustee Singleton offered a friendly amendment to extend the deadline to the end of the second quarter. The amendment was not accepted. Trustee Dedic commented to the Board that he believed that this exercise to review the small/mid cap manager was very educational for the Board. Trustee Dedic further commented to the Board that he did not wish to release Northpointe as the small/mid cap manager at this time. Trustee Dedic inquired to John Jackson, Asset Consulting about two things that Northpointe could do better, which were downward protection and time. Trustee Dedic believed that Northpointe has responded regarding the downward protection. Trustee Dedic stated that the same strategy was in place when the Board hired Northpointe. Therefore, he would vote against the resolution to release Northpointe. Trustee Kraus expressed concern regarding the presentation and the financial team working on the account. Employees Retirement System Regular Meeting of February 17, 2011 Page 3 Trustee McCaffery also expressed concern regarding the presentation. He also expressed concerned that Northpointe had one investment manager who actively works on the strategy. Adopted by the following vote: 4 — 2. The Board agreed to table the discussion on the Experience Study suggested by Gabriel, Roeder, and Smith until after the bid process is completed. Karen Williams reported to the Board regarding the City of Lansing Comprehensive Financial Annual Report. Budget Director Angela Bennett responded to the audit report regarding two items about the Retirement Office. The first item was the timing of the Actuary Report and the second items was the SAS 70 report. Karen Williams informed the Board that Ms. Bennett spoke in the Police and Fire meeting and stated that both items were administrative issues. Ms. Bennett stressed that the Board did not do anything incorrect. The administrative will work in send the data needed for the actuary report to Gabriel, Roeder, and Smith in spring instead of August. Additionally, moving forward the administration will provide the Board with SAS 70 report for review. Attorney Ken Lane opined that the Police and Fire Retirement System requested a policy regarding the SAS 70 report. review and inquired if the Employees Retirement system would like the same policy. It was moved by Trustee Parker and supported by Trustee Munroe for legal counsel to draft a policy regarding the SAS 70 report review. Adopted by the following vote: 7 — 0 It was moved by Trustee Rose and supported by Trustee Singleton to go to into closed session to review confidential information from legal counsel. Adopted by the following roll call vote: 7 — 0 Yeas: Dedic, Kraus, McCaffery, Munroe, Parker, Rose, Singleton Nays: 0 The Board went into closed session at 9:19 a.m. The Board returned from closed session at 9:33 a.m. Trustee Kraus reported that a letter has been written to finalists for the actuary bid process review so that interviews can be scheduled. i Employees Retirement System Regular Meeting of February 17, 2011 Page 4 Mr. McCaffery inquired to the Board if the change in Actuary would affect the Retirement Software process. Ms. Karen Williams reported to the Board that the Actuary Valuation software should not be affected with a change in Actuarial services. Attorney Kenneth Lane updated the Board regarding Mr. John Salmons who wrote a letter to City Council regarding his desire to change his beneficiary post retirement. Attorney Lane distributed a response to Mr. Salmons regarding the issues and concerns of a change to a beneficiary post-retirement. Attorney Lane suggested that the response be forwarded to City Council. It was moved by Trustee Rose and supported by Trustee Kraus to forward the response to Mr. John Salmons to City Council. Adopted by the following vote; 7 — 0. Attorney Ken Lane distributed copies of several polices for the Employees Retirement System Board. Attorney Lane also distributed a commonly asked questions document for the Board's review. The Board requested a month to review the policy. Attorney Lane updated the Board that the ERS Ordinance review was near completion from the City Attorney Office and the Council's Ways and Means committee and would be presented to City Council. Trustee Kraus inquired about Trustee binders held by former members. Attorney Ken Lane provides up-to-date binders for new trustees. Karen Williams distributed and discussed the Securities Lending Monthly report for January It was moved by Trustee Rose and supported by Trustee Singleton to adjourn the meeting. Adopted by the following vote: 6 - 0 The meeting adjourned at 9:49 a.m. t 1 1 1 I i Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting Council Conference Room 10th Floor, City Hall Lansing, MI March 17, 201 Thursday, 8:30 a:rm. 1 The Board met in regular session and was called to order at 8:38 a.m. Present: Dedic, Kraus, McCaffery, Munroe, Parker, Rose, Robinson (8:51), Singleton - 8 Absent: Trustee Bernero Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office), Carol Wood, City Council. It was moved by Trustee Kraus and supported by Trustee Rose to approve the Official minutes of the Employees Retirement System Regular Meeting of February 17, 2011. Adopted by the following vote: unanimously It was moved by Trustee Kraus and supported by Trustee Singleton to approve the Official Joint Police and Fire Retirement System and the Employees Retirement System Board Meeting of February 15, 2011. Adopted by the following vote: unanimously There were no public comments for items on the agenda. Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 0 retired. Total active membership: 510. Total deferred: 51. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of February, 2011 amounted to $1,663,653.52. Total retirement checks printed for the ERS System: 845. 1 death(s) Albert E. Howell, died 2/28/2011, (Public Service — UAW), age 67, spouse to receive 50%. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. There were no Requests for Regular Age and Service Retirements. There were no requests for duty disability retirements. Employees Retirement System Regular Meeting of March 17, 2011 Page 2 It was moved by Trustee Kraus and supported by Trustee Singleton to recess the meeting to allow the Disability subcommittee to meet to discuss disability applicants. Adopted by the following roll call vote: 7 - 0 Yeas: Dedic, Kraus, McCaffery, Munroe, Parker, Rose, Singleton Nays: 0 The meeting recessed at 8:41 a.m. It was moved by Trustee Kraus and supported by Trustee Singlet to rise from recess. Adopted by the following roll call vote: 7 — 0. Yeas: Dedic, Kraus, McCaffery, Munroe, Parker, Rose, Singleton Nays: 0 The meeting resumed at 8:45 a.m. Trustee Kraus reported that the Disability subcommittee met and recommends that the Board concur with the Medical Director's opinion to approve non -duty disability for Case #2010-E1021. It was moved by Trustee Kraus and supported by Trustee Munroe to concur with the Medical Director's report and approve the non -duty disability of Case #2010-E1021. Adopted by the following vote: 7 - 0 Ms. Williams reported that Case #2011 —E0315 has applied for non -duty disability based upon a serious health condition and cannot return to work. The case has been referred to the disability committee and has been reviewed. It was moved by Trustee Kraus and supported by Trustee Munroe to refer Case #2011- E0315 to the Medical Director for evaluation. Adopted by the following vote: 7 — 0. There were no Requests for Refunds of Accumulated Contributions. It was moved by Trustee Kraus and supported by Trustee Singleton to excuse Trustee Robinson from the Employees Retirement System Meeting of March 17, 2011. Adopted by the following vote: 7 - 0 Employees Retirement System Regular Meeting of March 17, 2011 Page 3 Karen Williams announced that members should have received their registration material for the Spring MAPERS that will be held May 1 — 3, to the City of Lansing Retirement Office. Ms. Williams was waiting for information for hotel registration. Trustee Robinson arrived to the meeting. Attorney Ken Lane provided a brief preview of some of the proposed board policies. Attorney Ken Lane provided a legislative update regarding HB4214 on the Emergency Financial Manager. Attorney Lane discussed the provision that would authorize the emergency manager to reject, modify, or terminate the terms of an existing contract or a collective bargaining agreement (CBA). Additionally, Attorney Lane discussed the provision regarding that would authorize the emergency manager to assumed control of the government's pension system, set and approve actuarial assumptions and eliminate the pension's system board for local governments not funded at a level of 80% or more. Attorney Ken Lane provided an update of fraud monitoring presentation by Milberg. Attorney Lane reported that the Employees Retirement System did not enter the litigation with the Police and Fire Retirement System. Attorney Lane reported that the Police and Fire Retirement Board had escrowed shares of Invacare stock. Milberg has sent a letter to Invacare as provided by Ohio law giving them 45 days to address their procedures before litigation would be initiated. Attorney Lane reported to the Employees Retirement System Board that the City Attorney informed him that Barrack Rodos and Bacine will be the third fraud monitoring firm for the Retirement Boards. Attorney Lane summarized that the Boards only voted for two firms, Milberg and Robbins, Geller, Rudman & Dowd. Attorney Lane explained that the City Attorney's provided an opinion that his interpretation of the Ordinance provided him the authority as legal counsel to hire the third firm. The City Attorney had Barrack Rodos and Bacine added to the City Council list of pre -approved legal firms. Attorney Ken Lane provided an overview of the proposed policy for fraud monitoring. Attorney Ken Lane stated the policy would provide a threshold in which a firm would contact the Retirement System. Attorney Lane discussed that when a company is sue, sometimes they may file a countersuit. Therefore, the City Attorney's Office must be involved in the process. When a fraud monitoring firm brought proposed litigation to the Board, the City Attorney's Office would review the case regarding the legal aspects. The case would be brought to the Board and Asset Consulting will also review the litigation. Employees Retirement System Regular Meeting of March 17, 2011 Page 4 Attorney Lane further discussed that the Police and Fire Board had concerns that the City Attorney could give the litigation to a firm of his choosing regardless of what firm brought the case to the Board. Attorney Lane stated that the Police and Fire Retirement Board decided to wait until the Policy was drafted before any action be taken. Trustee Carol Wood of the Police and Fire Retirement System requested to speak to the Employees Retirement System Board to provide further explanation regarding the fraud monitoring. Trustee Wood stated that she met with the City Attorney regarding the two firms voted on by the Board. At the time, the City Attorney was not happy that Barrack, Rodos and Bacine was not chosen and wished to add the third firm to the City Council resolution, and stated that the Board was under no obligation to use the firm. The agreement was that at a later time, the City Attorney would come back to the Board to request that Barrack, Rodos and Bacine be added. Trustee Wood stated that she would suggest to the Police and Fire Retirement Board to reaffirm the two chosen firms. It was moved by Trustee Rose and supported by Trustee Robinson to have Barrack, Rodos and Bacine provide their presentation to the Employees Retirement System. Trustee Kraus informed the members that Barrack, Rodos and Bacine and were interviewed with the other firms was not chosen. The City Attorney did not to participate in the interviews. Adopted by the following vote: 8 — 0. Attorney Ken Lane will set up the presentation. Trustee Dedic referred the proposed policies to pending until next month. Attorney Ken Lane reviewed the William Blair agreement as the new investment manager. He distributed a copy of the agreement for the Board's review. Attorney Ken Lane provided an overview of his modifications to the agreement that were sent to William Blair. Karen Williams distributed a memo from Asset Consulting Group regarding ING Real Estate Investment Manager and a letter from ING Clarion. ING has recently announced the sale of its real estate business and entered an agreement to move its real estate division to a new company Lightyear Capital LLC. It was moved by Trustee Kraus and supported by Trustee Rose to search a manager search to replace ING Clarion as recommended by Asset Consulting Group. Adopted by the following vote: 8 — 0. Employees Retirement System Regular Meeting of March 17, 2011 Page 5 Karen Williams reported that the Duty Disability income verification letters were mailed to retirees. Their verifications are due April 30, 2011. Ms. Williams explained that duty disability retirees are required by Ordinance to report their outside income to the Retirement Board. Attorney Ken Lane provided an overview of the modifications by Asset Consulting Group to the Investment Policy. Attorney Ken Lane provided an overview of the Investment Policy changes proposed by Asset Consulting Group. Some of the changes were that the hedge fund section was eliminated, and modifications to the section regarding security lending. The Retirement Analyst announced that the Interviews for the two finalists for Board will be held, Wednesday March 30 2011, from 8:30 am-12noon. The Joint Special Projects committee will be conducting the interviews. The interviews will consist of three parts, actuary report presentation, an education topic, and questions and answers. Attorney Ken Lane opined that the Police and Fire Retirement System requested a policy regarding the SAS 70 report review and inquired if the Employees Retirement system would like the same policy. Karen Williams reported to the Board that she met with the State of Michigan to receive a demonstration of their pension software system. The Software proposals (RFPs) have been received by the Retirement Office and are ready for review. The project manager will prepare an analysis of all the respondents. It was moved by Trustee Kraus and supported by Trustee Parker to refer the proposals to the Special Projects subcommittee. Adopted by the following vote: 8 — 0. Karen Williams distributed and discussed the Investment Report and the Securities Lending Monthly report for February. It was moved by Trustee Rose and supported by Trustee Singleton to adjourn the meeting. Adopted by the following vote: 6 - 0 The meeting adjourned at 9:25 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting Council Conference Room 10th Floor, City Hall Lansing, MI April 21, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:38 a.m Present: Dedic, McCaffery, Munroe, Parker, Rose - 5 Absent.- Trustee Bernero, Kraus, Robinson, Singleton Others: Karen E. Williams, Finance Department; Attorney Kenneth (representing the City Attorney's Office. ti -- Lane, Clark.. Hill It was moved by Trustee McCaffery and supported by Trustee Munroe to approve the Official minutes of the Employees Retirement System Regular Meeting of March 17, 2011. Adopted by the following vote: 5 - 0 There were no public comments for items on the agenda. Secretary's Report. 1 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 0 retired. Total active membership: 509. Total deferred: 52. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of March, 2011 amounted to $1,662,033.48. Total retirement checks printed for the ERS System: 844. 4 death(s), Louis S. Klimecky, died 3/10/2011, (Executive Plan — retired 1/5/1993), age 79, spouse to receive 100%; Gloria I. Moening, died 3/17/2011, (Police/Civilian — retired 9/15/1988), age 83, no surviving beneficiary; Philip A. Boyd, died 3/19/2011, Teamster 580 — retired 8/16/1988), age 88, no surviving beneficiary; Cecelia Rapelje, died 3/25/2011, age 88, surviving spouse of Exempt retiree. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. There were no Requests for Regular Age and Service Retirements. There were no requests for duty disability retirements. Ms. Williams reported that Case #2011 —E0317 has submitted his medical records and the records have been sent to the Medical Director for review. Employees Retirement System Regular Meeting of April 17, 2011 Page 2 There were no Requests for Refunds of Accumulated Contributions. It was moved by Trustee Parker and supported by Trustee Munroe to excuse Trustee Robinson from the Employees Retirement System Meeting of April 17, 2011. Adopted by the following vote: 5 - 0 Karen Williams announced that members should have received their registration material for the Spring MAPERS that will be held May 1 — 3, to the City of Lansing Retirement Office. Trustees were registered for the Invesco dinner during the conference. Attorney Ken Lane provided a review of the following proposed board policies: Ethic Policy, Records Retention Policy, Legal Documents Policy, Presentation Policy, Election Policy, Disability Re-examination Policy, Disability Application Review Policy, Military/Service Credit Policy, Investment Policy, Frequently Asked Questions Documents, Fraud Monitoring Policy and SAS 70 Policy. Trustee Dedic requested the Board consider a Policy in which Vendors for the Retirement System would have to reapply for their respective contract. Trustee Dedic suggested a policy of review and renewal for vendors. The Board agreed to further review the Election Policy, Disability Application Review Policy, Frequently Asked Questions Document, and the Fraud Monitoring Policy. It was moved by Trustee Rose and supported by Trustee McCaffery to approve the following policies: Ethics Policy, Records Retention Policy, Legal Documents Policy, Presentation Policy, Disability Re-examination Policy, Military/Service Credit Policy, Investment Policy and the SAS 70 policy. Adopted by the following vote: 5 — 0. Attorney Ken Lane requested that Barrack Rodos provide its presentation for the Employees Retirement System Board at the Joint Meeting in May. Attorney Ken Lane provided an update on William Blair. The Northpointe contract was terminated effective April 13. The William Blair contract will begin effective April 18. Northern Trust will handle the fund transfer between Northpointe and William Blair. Karen Williams reviewed the Northern Trust authorized signer. Northern Trust has suggested that there be more than one authorized signer and also provide an updated list of authenticators. Employees Retirement System Regular Meeting of April, 2011 Page 3 It was moved by Trustee McCaffrey and supported by Trustee Munroe to add the chairperson, Trustee Dedic as an authorized signer to the Northern Trust Account. Adopted by the following vote: 5 — 0. Trustee Dedic reported that the Police and Fire Retirement Board selected EFI as actuary for their retirement system. Mr. Jerry Ambrose has suggested that the City have one actuary. Trustee Parker stated that he liked EFI's presentation and he liked EFI's approach to actuary policy. Trustee Munroe liked both companies, but preferred to give Gabriel, Roeder an opportunity to be more proactive. Trustee Munroe added that GRS presentation was more technical, but like that the company was in Michigan. Trustee Rose requested that the decision be deferred to the next meeting and the Board would like to have Antonia Kraus' recommendation as chair of the Joint Special Projects subcommittee. Karen Williams updated the Board regarding the pension software. The special projects subcommittee decided to re -send the Request for Proposal with new information regarding cost and fee range. Attorney Ken Lane informed the Board that the contract with the Project Manager expired February 28, 2011. Attorney Lane drafted an extension to the contract through May 31 for Board approval. Attorney Lane stated that any time beyond May 31, 2011 will need a new contract. It was moved by Trustee Rose and supported by Trustee Parker to extend the Software Project Manager's contract through May 31, 2011. Adopted by the following vote: 5 — 0. Trustee Dedic requested that time be allotted at the next meeting to update the Trustee booklet. Trustee Rose suggested that the policies could be put on the intranet or the website for the trustees. Karen Williams reported that she received notification that Trustee Robinson had Trustee Training with legal counsel. Karen Williams distributed and discussed the Investment Report and the Securities Lending Monthly report for March. It was moved by Trustee Rose and supported by Trustee Singleton to adjourn the meeting. Adopted by the following vote: 6 - 0 The meeting adjourned at 9:38 a.m. Minutes approved on Scott Dedic, Chairperson Employees' Retirement System Jerry Ambrose, Secretary Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI May 19, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:38 a.m. Present: Dedic (8:48), Kraus, McCaffery, Munroe, Parker, Robinson (8:59), Rose - 7 Absent: Trustee Bernero, Singleton Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office. It was moved by Trustee McCaffery and supported by Trustee Parker to approve the Official minutes of the Employees Retirement System Regular Meeting of April 17, 2011. Adopted by the following vote: 5 - 0 There were no public comments for items on the agenda. Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 0 retired. Total active membership: 506. Total deferred: 53. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of April, 2011 amounted to $1,661,088.19. Total retirement checks printed for the ERS System: 842. 3 death(s), Delores A. Carrick, died 5/5/2011, (Planning — retired 9/15/2004), age 55, spouse to receive 100%; Robert A. Boyer, died 5/7/2011, (Public Service — retired 1/10/2003), spouse to receive 50%; Ruby L. Ray, died 5/9/2011, (Police/Civilian — retired 4/1/1997), age 62, no beneficiary. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestip-relations orders certified: 0. There were no Requests for Regular Age and Service Retirements. There were no requests for duty disability retirements. Ms. Williams reported that Case #2011 —E0317 has been scheduled to see the--Medical- Director for evaluation for non -duty disability. v) Employees Retirement System Regular Meeting of May 19, 2011 Page 2 There were no Requests for Refunds of Accumulated Contributions. It was moved by Trustee Rose and supported by Trustee Parker to excuse Trustee Robinson from the Employees Retirement System Meeting of May 19, 2011. Adopted by the following vote: 5 - 0 Trustee Robert Rose discussed some of the MAPERS Spring Conference workshops that included information on trustee liability. Trustee Rose found the roundtable regarding PA314 very informative. Trustee Rose reviewed the workshop regarding the economy and real estate. Trustee Mark Parker also reviewed several of the workshops that were available for attendees. Trustee Kraus stated that she always learns something new at the workshops presented. Trustee Kraus recommended members who did not attend to review the Conference Handbooks. Attorney Lane provided an update of legislation regarding HB 4361 that would tax public pensions and he reviewed the legislation that would have municipalities post Board expenditures on their website. Trustee Scott Dedic arrived to the meeting and assumed the chair. Trustee Kraus provided a report regarding the actuary bid selection. Trustee Kraus indicated that the Boards need to have one actuary. There were 4 firms that submitted, two were eliminated because they were not responsive to the proposal questions. Trustee Kraus brought up her concerns to the Police and Fire Board that the Boards did not meet jointly and would be leaving a Michigan based company. However, she felt that EFI provided a better presentation overall. Trustee Kraus' recommendation would be to select EFI. Trustee Dedic reported that the joint boards have agreed to review and discuss decisions that affected both board. Trustee Rose inquired about the process to transition from Gabriel, Roeder to EFI. Karen Williams explained that there would be overlap where the board has two actuaries to assist with the transition. The process was previously handled by an employee who has since left the City of Lansing. The Retirement Office and the Accounting Manager will be working with both actuaries to complete the 2010 evaluation. Trustee Munroe liked both companies, but would vote in the affirmative with the Board if they selected EFI, despite her concerns to give Gabriel, Roeder an opportunity to be more proactive and that the Board was leaving a Michigan-based company. Trustee Kraus wanted to Employees Retirement System Board to have a chance to voice its opinions and concerns. Employees Retirement System Regular Meeting of May, 2011 Page 3 It was moved by Trustee Rose and supported by Trustee Munroe to select EFI as the Employees Retirement System Board actuary. Adopted by the following vote: 6 - 0 Trustee Robinson arrived to the meeting. Attorney Ken Lane distributed a vendor review policy for Board consideration. Trustee Dedic moved the ERS Ordinance Status and Board policies to pending until the next meeting. Trustee Dedic moved the Handbook Update to pending until the next meeting. Karen Williams reviewed the Gabriel, Roeder, Smith minute master proposal for calendar year 2010. Karen Williams explained that minute master comprised of all the Board's minutes, contracts and decision in a searchable electronic database. The Board has adopted Minute Master as its official records for minutes prior to 1999. The Board requested that the Retirement Office contact EFI and inquire if EFI would adopt minute master and provide a proposal for its maintenance. Karen Williams updated the Board regarding the pension software. The Project Manager reviewed the RFPs and provided a fee summary of the proposals. Eric Tumbarella has requested to extend Dawn's contract. Karen Williams distributed the Securities Lending and Board Expense Monthly report for April. It was moved by Trustee Rose and supported by Trustee Parker to adjourn the meeting. Adopted by the following vote: 6 -0. The meeting adjourned at 9:18 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI June 23, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:58 a.m. Present: Dedic, Kraus, Munroe, Parker, Robinson (9:15), Rose - 7 Absent: Trustee Bernero, McCaffery, Singleton Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office; John Jackson, Asset Consulting Group; Scott Rubin, Brian Holland, Artio Global Investments. Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 0 retired. Total active membership: 506. Total deferred: 54. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of May, 2011 amounted to $1,659,621.09. Total retirement checks printed for the ERS System: 840. 1 death(s), John C. Wabake, died 5/22/2011, (Traffic — retired 1/5/1993), age 75, no beneficiary. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. It was moved by Trustee Parker and supported by Trustee Munroe to approve the Official minutes of the Employees Retirement System Regular Meeting of May 19, 2011. Adopted by the following vote: 5 - 0 It was moved by Trustee Kraus and supported by Trustee Parker to approve the Official minutes of the Joint Employees Retirement System and the Police and Fire Retirement System Boards meeting of May 19, 2011 Adopted by the following vote: 5 - 0 There were no public comments for items on the agenda. Employees Retirement System Regular Meeting of June 23, 2011 Page 2 It was moved by Trustee Munroe and supported by Trustee Parker to approve the following Request for Regular Age and Service Retirement: Murdock Jemerson (Parks — Executive Management), 11 years, 11 months, age 60, effective June 14, 2011. Adopted by the following vote: 5 — 0. There were no requests for duty disability retirements. Ms. Williams reported that the Retirement Office received the Medical Director's Report for Case #2011 —E0317 and the report was forwarded to the disability subcommittee for review. Trustee Kraus reported that the disability subcommittee reviewed Dr. Roth's report for Case #2011 — E0317 and recommends concurrence with the Medical Director's evaluation to approve non -duty disability retirement. It was moved by Trustee Rose and supported by Trustee Parker to concur with the Medical Director's report to approve the non -duty disability retirement of Case #2011 — E0317. Adopted by the following vote: 5 — 0. There were no Requests for Refunds of Accumulated Contributions. It was moved by Trustee Rose and supported by Trustee Parker to excuse Trustee McCaffery from the Employees Retirement System Meeting of June 23, 2011. Adopted by the following vote: 5 - 0 Mr. Scott Rubin and Mr. Brian Holland of Artio Global Management provided a performance review of City of Lansing Retirement System investment. Mr. Rubin provided an overview of the Firm, the Artio Global Team and account summary. Mr. Holland reviewed the Calendar Year Performance for 2010 and 2009, and the portfolio risk characteristics. Mr. Brian Holland provided an overview of the Artio Global philosophy, process and market strategy. Trustee Robinson arrived to the meeting. The Employees Retirement Board discussed with John Jackson, the Artio Global Investment underperformance for 2008 — 2010 relative to its benchmarks. The Board discussed replacing the Artio Global investment and asked John Jackson to provide recommendations to the investment subcommittee. Employees Retirement System Regular Meeting of June 23, 2011 Page 3 The Board moved to the Real Estate Investment Subcommittee Report. Trustee Rose reported that the subcommittee reviewed three potential replacements for ING Clarion. The committee received good presentations from JP Morgan and Prissa II and it was hard decision between the two firms. Trustee Rose felt that Prissa II met their goals better and were not weighted with a lot of industrial properties. Trustee Rose felt that Prissa II had a better balance of properties within the east and west coast. Trustee Parker also reported that he liked the Prissa II value-added approach. The subcommittee recommendation was to hire Prissa II. John Jackson reviewed Prissa II entrance and exit strategy for investments. The Board will commit a certain dollar amount and then Prissa II will call for the capital when needed. Mr. Jackson also explained how Prissa II acquires properties for the portfolio. Mr. Jackson also explained the differences between JP Morgan, Prissa II and the current manager, ING Clairon. Asset Consulting Group has recommended 5% real estate investment. The current investment is 1% with ING Clairon. John Jackson stated that the Board keep at 1% allocation to ING Clarion, and pull the money for capital calls from the over weighted assets in the portfolio. It was moved by Trustee Rose and supported by Trustee Parker to hire Prissa II and pull the capital calls from the over weighted asset in the portfolio, then slow withdraw from ING Clarion. Adopted by the following vote: 6 — 0 John Jackson reviewed the replacement strategy for Artio Global. He reported that Asset Consulting generally provided six possible investment managers for the Board to narrow down to 2-3 finalists for interviews. Attorney Ken Lane reviewed the Election Policy and the Board requested that the current draft be revised with alternatives. Attorney Lane also reviewed the current Disability Application Review Policy. Trustee Dedic suggested that the criteria should be that a duty disability applicant should only be evaluated for the job in which he was injured. Attorney Lane stated that Trustee Dedic's suggestion would require an amendment to the Ordinance. Attorney Lane provided a draft for the Frequently Asked Question Document for the Employees Retirement System. The Board requested another month to review with corrections made by the Retirement Office. Employees Retirement System Employees Retirement System Regular Meeting of June 23, 2011 Page 4 Attorney Lane reported that the City of Lansing did not get the lead plaintiff position for the litigation against China Integrated. Attorney Lane provided an update of the Invacare possible litigation. Milberg is waiting for a response to its letter outlining the concerns regarding Invacare's product. Milberg has reported that Invacare may voluntarily take care of the issue and they may not be a need for litigation. Attorney Lane reviewed the Fraud Monitoring Policy. John Jackson also discussed that he was checking with other firms to advise the Board regarding a dollar amount for the policy. Attorney Lane suggested a $50,000 dollar amount threshold in which the fraud monitoring firms would not bring litigation issues to the Board. Attorney Lane discussed the dollar amount with Milberg and Robbins, Gellar. Attorney Ken Lane provided a legislative update that summarized the pending Michigan House and Senate Bills and recently adopted Public Acts. He reviewed HB 4060 and 4123. The HB 4156 would require public pension system boards to publish its annual report, budget, and a listing of all expenditures on a website. Trustee Rose and Trustee Robinson discussed costs to the retirement system keep a retirement website updated with the required information if passed by the Michigan legislature. Attorney Ken Lane also discussed HB 4223 and SB 7. Senate Bill 7 would create the "Publicly Funded Health Insurance Contribution Act" to require that all public employees pay a certain percentage of the overall cost of the health insurance. Attorney Lane stated that as the current bill is written, it does not apply to retirees. Attorney Ken Lane reviewed the Public Act 38 of 2011 that amended the Michigan Income Tax law to tax public pensions, depending the age of the taxpayer. Trustee Dedic moved the ERS Ordinance Status and Board policies to pending until the next meeting. Karen Williams distributed the handbook updates to trustees and Attorney Ken Lane reviewed the updated table of contents. Karen Williams updated the Board that she provided a demonstration on the Retirement Calculation worksheets for the State of Michigan group working on pension software. Karen Williams distributed the Securities Lending and Board Expense Monthly report for May. John Jackson provided a review of the Investment Report for the month ending May 31, 2011. Attorney Ken Lane reported that EFI Actuaries has returned a signed original copy for the contract for actuarial services. It was moved by Trustee Rose and supported by Trustee Parker to adjourn the meeting. Adopted by the following vote: 5 -0. The meeting adjourned at 11:01 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting July 21, 2011 City Council Conference Room Thursday, 8:30 a.r�, 10th Floor, City Hall Lansing, MI The Board met in regular session and was called to order at 8:34 a.m. Present: Dedic, McCaffery, Munroe, Parker, Rose - 5 �. = Absent: Trustee Bernero, Kraus, Robinson, Singleton r ' Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office). It was moved by Trustee Parker and supported by Trustee Rose to approve the Official minutes of the Employees Retirement System Regular Meeting of July 21, 2011. Adopted by the following vote: 5 - 0 Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 1 retired. Total active membership: 503. Total deferred: 56. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of June, 2011 amounted to $1,660,202.09. Total retirement checks printed for the ERS System: 840. 3 death(s), Marcella M. Swagler, died 6/24/2011, (Public Service — retired 8/221977), age 93, no beneficiary; Lillie M. Thornton, died 6/18/2011, age 90, spouse of Exempt retiree); Doris M. Ball, died 7/18/2011 (Public Service —retired 1/3/1986), age 87, no beneficiary. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. There were no public comments for items on the agenda. It was moved by Trustee McCaffery and supported by Trustee Parker to approve the following Requests for Regular Age and Service Retirement: Steven G. Maloney (Planning — T580), 23 years, 9 months of service, age 58, effective June 27, 2011. Carla Eno, (Planning — T580), 21 years, 2 months of service, age 47, effective July 1, 2011. (65 points) Employees Retirement System Regular Meeting of July 21, 2011 Page 2 It was moved by Trustee McCaffery and supported by Trustee Parker to approve the following Requests for Regular Age and Service Retirement (cont.): Sandra M. Schultz (911 Center — FOP 911), 23 years, 1 months of service, age 53 effective 7/1/2011 (used additional 5.58 years of reciprocal retirement Act service credits to qualify) Susan M. Topping (Finance — T580), 24 years, 9 months of service, Age 56, effective July 1, 2011 (65 points) Richard J. Berends (Finance—T580), 11 years, 11 months of service age 67, effective July 1, 2011. Michael Haley (Public Service — UAW), 21 years of service, age 60, effective July 1, 2011 Adopted by the following vote: 5 — 0. There were no requests for duty disability retirements. There were no Non -Duty Disability retirements. It was moved by Trustee Rose and supported by Trustee Parker to approve the Request for Refunds of Accumulated Contributions: Janell Shepherd, (Human Resources— NonBargaining), $21,869.26 Adopted by the following vote: 5 — 0 Karen Williams announced that MAPERS registrations had been distributed by electronic mail. Hotel registrations would be forwarded as soon as they were available. She asked that members inform her of their decision to attend no later than August 30, 2011. Attorney Ken Lane reviewed the Election Policy. Attorney Lane suggested combining Parks and Recreations and Planning and Neighborhood Development as one unit. Trustee Munroe expressed concern that the Parks Department would not be represented due to the small number of employees. The Retirement Analyst provided technical amendments to the Policy. Employees Retirement System Regular Meeting of July 21, 2011 Page 3 It was moved by Trustee Rose and Trustee Parker to approve the Election Policy as amended and that it supercedes any previous Election Policy and will placed in the Trustee Handbook. Adopted by the following vote: 5 — 0. Attorney Ken Lane updated the Board regarding the Disability Application Review Policy. Trustee Singleton needed to review the policy on behalf of the Human Resources Department. Attorney Lane provided a draft for the Frequently Asked Question Document for the Employees Retirement System. The Board requested another month to review with corrections made by the Retirement Office. Attorney Lane reviewed the Fraud Monitoring Policy. John Jackson also discussed that he was checking with other firms to advise the Board regarding a dollar amount for the policy. Attorney Lane suggested a $50,000 dollar amount threshold in which the fraud monitoring firms would not bring litigation issues to the Board. The policy was tabled until next month. It was moved by Trustee Parker and supported by Trustee Munroe to approve the Vendor Review Policy. The Vendor Review Policy would supercede any previous policy and would be placed in the Trustee Handbook. Adopted by the following vote: 5 -0. Attorney Ken Lane provided a legislative memo that summarized the pending Michigan House and Senate Bills. He reviewed Senate Bill 7 and Substitute H6. The bill would create the Publicly Funded Health Insurance Contribution Act. The requirement of the Act would not apply to employees covered under a collective bargaining agreement that is inconsistent with its provisions until the collective bargaining act expires. Attorney Ken Lane provided an overview of the SAS 70 report compiled by Northern Trust that discusses the safety precautions in place regarding their system. Attorney lane suggested that John Jackson of Asset Consulting Group to review the safety precautions and a final opinion for the view. Karen Williams updated the Board that she talked with the Greg Stump of EFI to determine if EFI has Minute Master Services. EFI did not have these services, but would be willing to look into these services in the future. Trustee Dedic suggested that the Board review the Minute Master proposal from Gabriel, Roeder, Smith. Employees Retirement System Regular Meeting of June 23, 2011 Page 4 Trustee Rose updated the Board that the Special Projects subcommittee reviewed a proposal from the State of Michigan to develop pension software for the City of Lansing from scratch. The State determined that the Clarety system used by their retirement system would be too expensive to implement for Lansing. The pension software would be purchased by the City of Lansing but hosted on the State of Michigan system. The subcommittee narrowed the list down to five vendors. Trustee Munroe expressed concerns regarding the State of Michigan proposal and requested an opportunity to view the other Requests for Proposals that were submitted. Karen Williams distributed the Investment and Securities Lending Monthly report for June. It was moved by Trustee Parker and supported by Trustee Rose to adjourn the meeting. Adopted by the following vote: 5 -0. The meeting adjourned at 11:01 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System CITY OF LANSING JOINT POLICE & FIRE and EMPLOYEES RETIREMENT SYSTEM MINUTES Joint Meeting August 16, 2011 Council Conference Room Tuesday, 9:15 a.m.;., 10th Floor City Hall Lansing' MI I` The meeting was called to order at 9:30 a.m. C� A quorum of the Police and Fire Retirement Boards was present. Trustees present: (Police & Fire), Hecksel, Kraus, Oleson, St. Aubin, Wood — 5. (ERS), Kraus, Parker, Rose — 3. Other presents: John Jackson, Asset Consulting; Karen Williams Finance Department; Ken Lane, Clark Hill Law Office (representing the City Attorney's Office); James So, Frances Coombes, Western Asset Management Company. Mr. James So and Ms. Frances Coombes provided a Performance Review of Western Asset Management Company. Ms. Coombes gave an organizational update of the company. Mr. So discussed the current financial markets and provided an overview of the ERS and Police and Fire portfolios. Mr. John Jackson distributed memos and reviewed Asset Consulting Group recommendations for Quarterly Cash Flow Withdrawals for the Retirement Boards. The City of Lansing Police and Fire Retirement System requested $2.0 million to be raised for the quarterly cash withdrawals. It was moved by Trustee Wood and supported by Trustee Oleson to approve Asset Consulting Group recommendation that the Police and Fire Retirement Board withdraw $1.0 million from the Artisan portfolio and $1.0 million from the Mondrian portfolio to fund quarterly cash withdrawals. Adopted by the following vote: 5 - 0. It was moved by Trustee Wood and supported by Trustee Oleson to transfer $5,000 from the Northern Trust Securities Lending Account to the Comerica account for administrative expenses. Adopted by the following vote: 5 - 0. Joint Meeting Council Conference Room 10th Floor City Hall Lansing, MI August 16, 2011 Tuesday, 9:15 a.m. Page 2 Mr. John Jackson distributed a memo and reviewed the SAS 70 Report for both Retirement Boards. The SAS 70 Report contained information regarding the internal controls issued by the Northern Trust Company for the year ended March 31, 2011. ACG review included the following areas: Account Administration, Securities Movement, Securities Custody and Reconciliation, Cash Movement and Reconciliation and Securities Lending. It was moved by Trustee Hecksel and supported by Trustee Kraus to accept the SAS 70 Report in accordance with the Police and Fire Retirement Board policy and contingent upon a review by the Information Technology department. Attorney Ken Lane stated that he will conduct Eric Tumbarella to review the controls surrounding the use and implementation of technology in the SAS 70 report. Adopted by the following vote: 5 -0. Mr. John Jackson reviewed the upcoming Asset Consulting Group dates.. Tuesday, September 13, the Employees Retirement System Board Investment Subcommittee would meet to discuss International Investment Search. Mr. Jackson also suggested the first week of December for the Joint Boards to attend a due diligence visit at Asset Consulting Group in Missouri. Mr. John Jackson provided a quarterly performance review of the Boards Investments and a Capital Markets update. Asset Consulting Group recommended that the Joint Board further diversify its portfolios with the addition of multi -sector fixed income strategy. Mr. John Jackson reviewed this type of investment and suggested that the Joint Investment Board meet to review possible managers. Mr. Jackson will provide a memo to both Boards outlining ACG's recommendation. The Meeting adjourned at 11:31 a.m. Minutes approved on Jerry Ambrose, Secretary Scott Dedic, Chairperson Employees Retirement System Brad St. Aubin, Chairperson Police and Fire Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM -Approved Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI August 25, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 9:00 am. Present: Dedic, Munroe, Parker, Rose, Singleton (9:10 a.m.) - 5 Absent: Trustee Bernero, Kraus, McCaffery, Robinson Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hili (representing the City Attorney's Office). Secretary's Report. 5 new member(s), 0 reinstatement(s), 1 refund(s), 0 transfers, 6 retired. Total active membership: 499. Total deferred: 57. Refunds made since the last regular meeting amounted to $21,869.26. Retirement allowances paid for the month of July, 2011 amounted to $1,701,353.18. Total retirement checks printed for the ERS System: 846. 4 death(s), Mr. James Crisp, died 7/8/2011, (Public Service - duty disability 2/20/2004), age 57, spouse to receive 100%; Ruth E. Meckes, died 7/10/2011, age 89, no beneficiary: Ms. Meriem Titus, died 6/20/2011, age 94, spouse of Exempt retiree; Ms. Lillie Thornton, died 6/18/2011, age 90, spouse of Exempt retiree. Eligible domestic relations orders received: 1. Domestic relations orders pending: O. Eligible domestic relations orders certified: 0. There were no public comments for items on the agenda. There were no requests for Duty Disability Retirements. There were no requests for NonDuty Disability Retirements. Karen Williams announced that Trustee should have received their MAPERS and hotel registrations. Ms. Williams distributed an invitation for dinner hosted by Keri Hepburn of Invesco during MAPERS. She asked that interested Trustees contact the Retirement Office. Karen Williams announced upcoming Asset Consulting Dates: September 13 will be ERS Investment Subcommittee for International Global Investment Search; September 14 for Joint Investment Subcommittee meeting to review Multi -Sector Fixed Income Investments. John Jackson proposed a date in November to reschedule Trustee Training and December 6 -7 for the due diligence visit to Asset Consulting Group. Employees Retirement System Regular Meeting of August 25, 2011 Page 2 The Retirement Office reported 1 request for Refund of Accumulated Contributions for Danielle Stubbs, City Council Staff, $3,108.60.. Ms. Stubbs was not vested. It was moved by Trustee Rose and supported by Trustee Parker to approve the Official minutes of the Employees Retirement System Regular Meeting of July 21, 2011. Adopted by the following vote: 5 - 0 It was moved by Trustee Rose and supported by Trustee Parker to approve the following Requests for Regular Age and Service Retirement: Timothy J. May, (Parks- Teamster 580), 8 years, 4 months of service, age 58, Effective August 1, 2011. (From Deferred) Adopted by the following vote: 5 - O. t was moved by -Trustee Munroe and supported by Trustee Rose to excuse Trustees Kraus and McCaffery from the Employees Retirement System Board meeting. Adopted by the following vote: 5 - O. Attorney Ken Lane reviewed the Disability Application Review Policy. Attorney Lane explained that the disability subcommittee would work with the Human Resources Department to provide a list of eligible job for Dr. Roth to review when determining duty disability. It was moved by Trustee Rose and Trustee Parker to approve the Employees Retirement System Disability Application Review Policy and that it supersedes any previous Disability Application Review Policy and will placed in the Trustee Handbook. Adopted by the following vote: 5 - 0. Attorney Lane reviewed the amended draft for the Frequently Asked Question Document for the Employees Retirement System. It was moved by Trustee Rose and supported by -Trustee Parker to approve the Employees Retirement System Frequently Asked Question Document. Adopted by the following vote: 5 - 0 Attorney Lane distributed updates for the Trustee Handbooks. Employees Retirement System Regular Meeting of August 25, 2001 Page 3 Attorney Lane updated the Board regarding the pending Fraud Monitoring Policy and the cases against China Integrated and Invacare. Attorney Lane reviewed the Fraud Monitoring Policy. John Jackson also discussed that he was checking with other firms to advise the Board regarding a dollar amount for the policy. Attorney Lane suggested a $50,000 dollar amount threshold in which the fraud monitoring firms would not bring litigation issues to the Board. The policy was placed on pending until next month. Attorney Ken Lane provided a legislative memo that summarized the legislation regarding Health Care in the Michigan Senate. The bill. is a hybrid that would provide an option for employers to set a hard dollar amount cap or allow employers to pay no more than 80%. The bill passed both houses and would have an effective date of July 2012. Attorney Lane indicated that the current bill is not applicable to retiree health care plan. Attorney Ken Lane requested to go into closed session to review attorney-client privileged information. It was moved by Trustee Rose and supported by Trustee Singleton to go into closed session to review attorney client privileged legal opinion. Adopted by the following roll call vote: 5 - 0 Yes: Dedic, Munroe, Parker, Rose, Singleton No: 0 The session was closed at 9:25 a.m. The session was opened and resumed at 9:45 a.m. Karen Williams updated the Board that she talked with the Greg Stump of EFI to determine if EFI has Minute Master Services. EFI did not have these services, but would be willing to look into these services in the future. Trustee Dedic suggested that the Board review the Minute Master proposal from Gabriel, Roeder, and Smith. Ms. Williams indicated the Minute Master fee proposal provided a range of $1,850 -$2,650 not to exceed $3,100. The Police and Fire System approved the fee for Minute Master. It was moved by Trustee Rose and supported by Trustee Parker to approve the Gabriel, Roeder, Smith fee for Minute Master with expenses not to exceed $2,650. Adopted by the following vote: 5 - O. Trustee Mark Parker reported that the Investment subcommittee met to review managers to replace Artio Global. The three firms selected for interviews were Arrowstreet, Earnest, Harding-Loevner. Employees Retirement System Regular Meeting of August 25, 2001 Page 4 Trustee Rose reported that the investment subcommittee also discussed adding emerging market sector into the portfolio. It was moved by Trustee Rose and supported by Trustee Parker to accept the Investment subcommittee recommendations to interview Arrowstreet, Earnest and Harding-Loevner and to start a search for an emerging market manager. Adopted by the following vote: 5 - 0 Karen Williams distributed a memo from John Jackson of Asset Consulting Group regarding Multi -Sector Fixed Income Review. Mr. Jackson would like to have the review September 14 for both retirement boards to further diversify their investment portfolio. Mr. Jackson will provide a list of managers within the strategy for the investment subcommittees to review. The Employees Retirement Board approved moving forward with the Multi -Sector Fixed Income strategy. Karen Williams distributed a memo from Asset Consulting Group for quarterly cash withdrawals. ACG recommends withdrawing $1.2 million from Artio Global and $1.8 million from Western Asset Management. Ms. Williams also notified the board that it was time for the quarterly cash flow from Northern Trust Securities Lending to Comerica of $5,000. It was moved by Trustee Rose and supported by Trustee Parker to approve the Asset Consulting Group Recommendation to withdraw $1.2 million from Artio Global and $1.8 million from Western Asset Management for quarterly cash flow withdrawals. The Board also will withdraw $5,000 from Northern Trust Securities Lending for quarterly administrative expenses. Adopted by the following vote: 5 - O. Karen Williams distributed a memo from Asset Consulting Group proving an overview of the SAS 70 report by Northern Trust that discusses the safety precautions in place regarding their system. The Employees Retirement System policy recommends that the Board review and accept the SAS 70 report each year. ACG's report includes information regarding the following Northern Trust services: Account administration, securities movement, securities custody and reconciliation, cash movement and reconciliation, trade communication and settlement, active collateral management, asset data maintenance, asset pricing, income collections, tax reclamations, corporate actions, proxy voting, client reporting and account, and securities lending. Attorney lane suggested that the Information Technology department should review the safety precautions and controls surrounding the use and implementation of technology. Employees Retirement System Regular Meeting of August 25, 2011 Page 5 It was moved by Trustee Singleton and supported by Trustee Parker to accept the SAS 70 report contingent on the Information Technology department's review. Adopted by the following vote: 5 0 Karen Williams updated the Board regarding the purchase of an external hard drive for security and back up of data for the retirement system. This external drive would be in addition to Information Technology department system security and backup. The Police and Fire Board has agreed to purchase and if approved split the cost the Employees Retirement Board. The system would cost approximately $75.99. It was moved by Trustee Rose and supported by Trustee Munroe to split the cost of obtaining an external hard drive with the Police and Fire Retirement System for securing the Retirement Office computer data. Adopted by the following vote: 5 - 0. Karen Williams distributed the Investment and Securities Lending Monthly report for July. Trustee Rose requested that the Employees Retirement System Board receive a recent invoice for Dawn Polihonki's services as Project Manager for the pension software selection. It was moved by Trustee Rose and supported by Trustee Parker to adjourn the meeting. Adopted by the following vote: 5 -0. The meeting adjourned at 10:08 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting August 25, 2011 City Council Conference Room Thursday, 8:3fl�a.rt?;; Employees Retirement System Regular Meeting of August 25, 2011 Page 2 The Retirement Office reported 1 request for Refund of Accumulated Contributions for Danielle Stubbs, City Council Staff, $3,108.60. Ms. Stubbs was not vested. It was moved by Trustee Rose and supported by Trustee Parker to approve the Official minutes of the Employees Retirement System Regular Meeting of July 21, 2011. Adopted by the following vote: 5 - 0 It was moved by Trustee McCaffery and supported by Trustee Parker to approve the following Requests for Regular Age and Service Retirement: Timothy J. May, (Parks- Teamster 580), 8 years, 4 months of service, age 58, Effective August 1, 2011. (From Deferred) Adopted by the following vote: 5 — 0. t was moved by Trustee Munroe and supported by Trustee Rose to excuse Trustees Kraus and McCaffery from the Employees Retirement System Board meeting. Adopted by the following vote: 5 - 0. Attorney Ken Lane reviewed the Disability Application Review Policy. Attorney Lane explained that the disability subcommittee would work with the Human Resources Department to provide a list of eligible job for Dr. Roth to review when determining duty disability. It was moved by Trustee Rose and Trustee Parker to approve the Employees Retirement System Disability Application Review Policy and that it supersedes any previous Disability Application Review Policy and will placed in the Trustee Handbook. Adopted by the following vote: 5 — 0. Attorney Lane reviewed the amended draft for the Frequently Asked Question Document for the Employees Retirement System. It was moved by Trustee Rose and supported by Trustee Parker to approve the Employees Retirement System Frequently Asked Question Document. Adopted by the following vote: 5 — 0 Attorney Lane distributed updates for the Trustee Handbooks. Employees Retirement System Regular Meeting of August 25, 2001 Page 3 Attorney Lane updated the Board regarding the pending Fraud Monitoring Policy. Milberg withdraw its case against Integrated on behalf of the Board because Puerto Rico will be lead plantiff. Attorney Lane reviewed the Fraud Monitoring Policy. John Jackson also discussed that he was checking with other firms to advise the Board regarding a dollar amount for the policy. Attorney Lane suggested a $50,000 dollar amount threshold in which the fraud monitoring firms would not bring litigation issues to the Board. The policy was placed on pending until next month. Attorney Ken Lane provided a legislative memo that summarized the legislation regarding Health Care in the Michigan Senate. The bill is a hybrid that would provide an option for employers to set a hard dollar amount cap or allow employers to pay no more than 80%. The bill passed both houses and would have an effective date of July 2012. Attorney Lane indicated that the current bill is not applicable to retiree health care plan. Attorney Ken Lane requested to go into closed session to review attorney-client privileged information. It was moved by Trustee Rose and supported by Trustee Singleton to go into closed session to review attorney client privileged legal opinion. Adopted by the following roll call vote: 5 - 0 Yes: Dedid, Munroe, Parker, Rose, Singleton No: 0 The session was closed at 9:25 a.m. The session was opened and resumed at 9:45 a.m. Karen Williams updated the Board that she talked with the Greg Stump of EFI to determine if EFI has Minute Master Services. EFI did not have these services, but would be willing to look into these services in the future. Trustee Dedic suggested that the Board review the Minute Master proposal from Gabriel, Roeder, Smith. Ms. Williams indicated the Minute Master fee proposal provided a range of $1,850 -$2,650 not to exceed $3,100. The Police and Fire System approved the fee for Minute Master. It was moved by Trustee Rose and supported by Trustee Parker to approve the Gabriel, Roeder, Smith fee for Minute Master with expenses not to exceed $2,650. Adopted by the following vote: 5 — 0. Trustee Mark Parker reported that the Investment subcommittee met to review managers to replace Artio Global. The three firms selected for interviews were Arrowstreet, Earnest, Harding-Loevner. Employees Retirement System Regular Meeting of August 25, 2001 Page 4 Trustee Rose reported that the investment subcommittee also discussed adding emerging market sector into the portfolio. It was moved by Trustee Rose and supported by Trustee Parker to accept the Investment subcommittee recommendations to interview Arrowstreet, Earnest and Harding-Loevner and to start a search for an emerging market manager. Adopted by the following vote: 5 — 0 Karen Williams distributed a memo from John Jackson of Asset Consulting Group regarding Multi -Sector Fixed Income Review. Mr. Jackson would like to have the review September 14 for both retirement boards to further diversify their investment portfolio. Mr. Jackson will provide a list of managers within the strategy for the investment subcommittees to review. The Employees Retirement Board approved moving forward with the Multi -Sector Fixed Income strategy. Karen Williams distributed a memo from Asset Consulting Group for quarterly cash withdrawals. ACG recommends withdrawing $1.2 million from Artio Global and $1.8 million from Western Asset Management. Ms. Williams also notified the board that it was time for the quarterly cash flow from Northern Trust Securities Lending to Comerica of $5,000. It was moved by Trustee Rose and supported by Trustee Parker to approve the Asset Consulting Group Recommendation to withdraw $1.2 million from Artio Global and $1.8 million from Western Asset Management for quarterly cash flow withdrawals. The Board also will withdraw $5,000 from Northern Trust Securities Lending for quarterly administrative expenses. Adopted by the following vote: 5 — 0. Karen Williams distributed a memo from Asset Consulting Group proving an overview of the SAS 70 report by Northern Trust that discusses the safety precautions in place regarding their system. The Employees Retirement System policy recommends that the Board review and accept the SAS 70 report each year. ACG's report includes information regarding the following Northern Trust services: Account administration, securities movement, securities custody and reconciliation, cash movement and reconciliation, trade communication and settlement, active collateral management, asset data maintenance, asset pricing, income collections, tax reclamations, corporate actions, proxy voting, client reporting and account, and securities lending. Attorney lane suggested that the Information Technology department should review the safety precautions and controls surrounding the use and implementation of technology. and a final opinion for the view. Employees Retirement System Regular Meeting of August 25, 2011 Page 5 It was moved by Trustee Singleton and supported by Trustee Parker to accept the SAS 70 report contingent on the Information Technology department's review. Adopted by the following vote: 5 — 0 Karen Williams updated the Board regarding the purchase of an external hard drive for security and back up of data for the retirement system. This external drive would be in addition to Information Technology department system security and backup.The Police and Fire Board has agreed to purchase and if approved split the cost the Employees Retirement Board. The system would cost approximately $75.99. It was moved by Trustee Rose and supported by Trustee Munroe to split the cost of obtaining an external hard drive with the Police and Fire Retirement System for securing the Retirement Office computer data. Adopted by the following vote: 5 — 0. Karen Williams distributed the Securities Lending Monthly report for June. Trustee Rose requested that the Employees Retirement System Board receive a recent invoice for Dawn Polihonki's services as Project Manager for the pension software selection. It was moved by Trustee Rose and supported by Trustee Parker to adjourn the meeting. Adopted by the following vote: 5 -0. The meeting adjourned at 10:08 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI September 15, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:38 a.m. Present: Dedic (8:50), Kraus, McCaffery, Munroe(9:20), Parker, Rose, Singleton - 7 Absent: Trustee Bernero, Robinson Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office). It was moved by Trustee Rose and supported by Trustee Parker to approve the Official Minutes of the Employees Retirement System Board Regular Meeting of August 25, 2011 as amended. Adopted by the following vote: 5 — 0. It was moved by Trustee Rose and supported by Trustee Parker to approve the Official Minutes of the Joint Police and Fire and Employees Retirement System Board Regular Meeting of August 16, 2011. Adopted by the following vote: 5 — 0. Secretary's Report. 0 new member(s), 0 reinstatement(s), 1 refund(s), 0 transfers, 1 retired. Total active membership: 494. Total deferred: 58. Refunds made since the last regular meeting amounted to $3,108.60. Retirement allowances paid for the month of August, 2011 amounted to $1,683,992.56. Total retirement checks printed for the ERS System: 846. 2 death(s), Maxine Bodwin, died 8/16/2011, age 92, spouse of Exempt retiree; Jean E. Murning;han, died 8/18/2011, age 88, spouse of Exempt retiree. Eligible domestic :relations orders received: 0. Domestic relations orders pending: 0. Eligible do;mostic relations orders certified: 0. C-? There were no public comments for items on the agenda. Trustee Scott Dedic arrived at the meeting and presided. Employees Retirement System Regular Meeting of September 15, 2011 Page 2 It was moved by Trustee McCaffery and supported by Trustee Parker to approve the following Requests for Regular Age and Service Retirement: Daniel E. Abercrombie, (Police/Civilian - Teamster 580), 21 years, 3 months of service, 44 years, effective September 15, 2011. (65 points) James L. Bancroft (Finance — UAW), 24 years, 7 months of service, age 58, effective September 19, 2011. John H. Kloosterman (Planning — Teamster 580), 9 years, 4 months of service, age 62, effective September 16, 2011. Charles A. Shaffer (Finance — UAW), 25 years, 7 months of service, age 58, effective September 9, 2011. Adopted by the following vote: 6 — 0. There were no requests for Duty Disability Retirements. Karen Williams reported to the Employees Retirement System Board that MES Solutions has expanded and has offered the services of its list of physicians in the Southwest region. Dr. Roth belongs to the MES Solutions group. Attorney Ken Lane opined that Dr. Roth as the medical director is the original point of contact. A referral to one of the other doctors on the MES solutions list should be come from Dr. Roth. There were no requests for NonDuty Disability Retirements. There were no requests for Requests for Accumulated Contributions. Karen Williams reported that Trustee Munroe informed the Retirement Office that she would be late to the meeting. It was moved by Trustee Rose and supported by Trustee Parker to excuse Trustee Robinson from the September Employees Retirement System Board meeting. Adopted by the following vote: 6 — 0. Karen Williams announced upcoming Asset Consulting Dates: September 20 will be a golf outing for Trustees who are planning to attend MAPERS.; October 26 is the rescheduled date for Trustee Training, October 2.6 is also the date for the interviews for the Multi -Sector Fixed Income Interviews, starting at 8:30 a.m., and December 6 -7 for the due diligence visit to Asset Consulting. Employees Retirement System Regular Meeting of September 15, 2011 Page 3 Attorney Lane updated the Board regarding the pending Fraud Monitoring Policy. Attorney Lane discussed the $50,000 dollar amount threshold with John Jackson in which the fraud monitoring firms would not bring litigation issues to the Board. Asset Consulting Group did not have a problem with the dollar amount. The policy was placed on pending until next month. It was moved by Trustee Parker and supported by Trustee Rose to approve the Fraud Monitoring Policy. The Policy will supersede and replace any prior Fraud Monitoring Policy and will be placed in the Trustee Handbook. Adopted by the following vote: 6 -0. Attorney Ken Lane provided a legislative update for the legislation regarding Health Care in the Michigan Senate. The public act is a hybrid that would set a hard cap or allow employers to pay no more than 80%. Attorney Lane indicated that the current bill is not applicable to retirees. Attorney Lane discussed the state legislation that minimum staffing requirements can not be done in the Ordinance. Attorney Ken Lane updated the Board regarding the Prudential PRISSA Investment agreement. The agreement has been reviewed by legal counsel and will executed after the chairperson's signature. Trustee Robert Rose reviewed the interviews for the International Investment search. Trustee Parker reported that Earnest was a good complement to the current investment portfolio. The investment subcommittee recommended Earnest Partners as a replacement of Artio Global. It was moved by Trustee Rose and supported by Trustee Parker to approve Earnest Partners as the Employees Retirement System International Investment fund manager. Adopted by the following vote: 6 — 0 Trustee Parker reviewed the Multi -Sector Fixed Income managers that were presented by Asset Consulting Group. Trustee Rose discussed the selection of three finalists to be interviewed by the Employees Retirement System Board, October 26, 2011. Trustee Kraus updated the Board that the Special Projects subcommittee reviewed a proposal from the pension software for the City of Lansing Retirement system. Trustee Kraus reported that there was a meeting with Jerry Ambrose, Eric Tumbarella, Dawn Polihonki and Karen Williams. Trustee Kraus explained that the group reviewed the Retirement System Project Top 5 Pricing Responses Analysis. Employees Retirement System Regular Meeting of September 15, 2011 Page 4 Upon reviewing, the group determined that three of the companies did not meet the necessary criteria to move forward. The group suggestion was to move forward with two finalists and have demonstrations either on-site or via a web demo. Karen Williams reviewed the two finalists and her recommendation. Trustee Munroe arrived to the meeting. Trustee Kraus reminded members that the costs listed are preliminary. Final costs would be negotiated with the vendor. Trustee Kraus requested members who would like to attend the demonstrations. Trustee Kraus stated that she would contact Eric Tumbarella and Dawn Polihonki to set up the demonstrations. Trustee Rob Rose recommended that the computer equipment be updated for the Retirement Office. Trustee Rose indicated that the Police and Fire System approved a not -to -exceed budget of $2,000. It was moved by Trustee Rose and supported by Trustee Kraus to approve a budget not -to -exceed budget of $2,000 to attain computer workstation for the Retirement Office. Trustee Kraus added that she believed the computer equipment had not been replaced for approximately 6 -10 years. Trustee Kraus talked with Eric Tumbarella about a budget and selecting a workstation for the Retirement Office. Trustee Kraus also reported that the Police and Fire System had a concern that if a laptop was purchased that it did not leave the City premises due to the confidential data that may be contained on the system Adopted by the following vote: 7 - 0 Trustee Rose requested that legal counsel draft a policy regarding the use of the laptop and its information. The policy will provide direction for the Retirement Office It was moved by Trustee Rose and supported by Trustee Parker to have legal counsel draft a policy regarding the use of the laptop computer equipment. Adopted by the following vote: 7 — 0 Karen Williams reviewed the Investment and Securities Lending Monthly report for August 2011. It was moved by Trustee Parker and supported by Trustee Rose to adjourn the meeting. Adopted by the following vote: 5 -0. The meeting adjourned at 11:01 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI October 20, 2011 Thursday, 8.30 a.m. The Board met in regular session and was called to order at 8:45 a.m. Present: Dedic (8:55), McCaffery, Munroe, Parker, Robinson, Rose, Singleton - 7 Absent: Trustee Bernero, Kraus Others- Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office). Trustee Parker presided over the meeting. It was moved by Trustee McCaffery and supported by Trustee Rose to approve .the Official Minutes of the Employees Retirement System Board Regular Meeting*= of October 20, 2011. , There were no public comments Adopted by the following vote- 6 — 0. - Secretary's Report. 1 new member(s), 0 reinstatement(s), 0 refund(s)C:-D-0 transfers, 4 retired. Total active membership: 486. Total deferred- 59. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of September, 2011 amounted to $1,686,226.47. Total retirement checks printed for the ERS System: 845. 4 death(s), Marcella Swagler, died 6/24/2011, age 93, spouse of Exempt retiree; Iola Stevens, died 8/27/2011, age 89, spouse of Exempt retiree; Joyce A. Borseth, died 9/12/2011, age 83, spouse of Exempt retiree; Fred A. Brown, died 10/7/2011, age 76, no beneficiary. Eligible domestic relations orders received: 0. Domestic relations orders pending: 1. Eligible domestic relations orders certified: 0. It was moved by Trustee Robinson and supported by Trustee Rose to approve the following Requests for Regular Age and Service Retirement: Douglas A. Chambers, (Finance/Treasury - Teamster 580), 21 years, 12 years, 9 months of service, age 63 years, effective October 22, 2011. Adopted by the following vote: 6 — 0. Employees Retirement System Regular Meeting of October 20, 2011 Page 2 There were no requests for Duty Disability Retirements. There were no requests for NonDuty Disability Retirements. It was moved by Trustee Rose and supported by Trustee Robinson to approve the following request for Refund of Accumulated Contributions: Amy Iseler, 54-A District Court, $5,434.91 Adopted by the following vote: 6 — 0 It was moved by Trustee Rose and supported by Trustee Robinson to excuse Trustee Kraus from the October Employees Retirement System Board meeting. Adopted by the following vote: 6 — 0 Trustee Rose provided an overview of MAPERS Conference. Trustee Rose discussed the workshops, pending legislation the survey of retirement systems. Trustee Scott Dedic arrived at the meeting and presided. Attorney Ken Lane provided a legislative update from MAPERS regarding amendments to Public Act 314. Attorney Lane also distributed a memo that discussed the Economic Vitality Incentive Program, Public Act 63 of 2011, as a replacement to the statutory revenue sharing. The legislation identified three different measures or categories that eligible cities, villages and townships need to accomplish to receive state funding under the program. A community would receive 1/3 of the maximum funding amount for each of the three categories it fulfills the specific requirements. Attorney Ken Lane provided a legislative update for the legislation regarding Health Care in the Michigan Senate. The public act is a hybrid that would set a hard cap or allow employers to pay no more than 80%. Attorney Lane indicated that the current bill is not applicable to retirees. Trustee Mark Parker reported that there were 57 MAPERS participants who responded to a survey request regarding the status of the pension funds regarding issues that include investment returns and actuarial assumptions Karen Williams announced upcoming Asset Consulting Dates: September 20 will be a golf outing for Trustees who are planning to attend MAPERS.; October 26 is the rescheduled date for Trustee Training, October 26 is also the date for the interviews for the Multi -Sector Fixed Income Interviews, starting at 8:30 a.m., and December 6 -7 for the due diligence visit to Asset Consulting. Employees Retirement System Regular Meeting of October 20, 2011 Page 3 Ms. Williams stated that the Due Diligence meeting and activities are planned for December 6, 2011. Ms. Williams requested that all members who are interested in the due diligence trip contact the Retirement Office by November 3, 2011 for a head count for flight and hotel arrangements. Karen Williams requested Board approval for membership renewals for MAPERS, iFEPB and NCPERS. The fees are: MAPERS, $50.00; 1/z IFEBP, $377.50, 1/2 NCPERS, $112.50. The IFEPB and NCPERS dues are split with the Employees Retirement System. It was moved by Trustee McCaffery and supported by Trustee Rose to pay dues renewal for MAPERS, IFEBP and NCPERS from securities lending. Adopted by the following vote: 7 — 0. Karen Williams distributed and Attorney Ken Lane reviewed the update for the Travel Policy. Attorney Ken Lane updated the Board regarding the SAS 70 Report Policy. He has contacted Mr. Eric Tumbarella, IT Department to review the technology aspects of the SAS Report. Attorney Lane will follow up with Mr. Tumbarella for a report. Attorney Lane discussed a generic memo that he has drafted regarding the Reciprocal Retirement Act that is available for distribution. Attorney Ken Lane updated the EARNEST Investment process. Attorney Lane informed the Board that EARNEST has a contract provision that the document has to be incorporated in the Plan. Attorney Lane has reviewed this information and notified the Board that this contact will have no effect on bargaining agreements or ordinance provisions. . The agreement has been reviewed by legal counsel and will executed after the chairperson's signature. Karen Williams distributed information regarding the pension software demonstration. Ms. Williams met with Dawn Polihonki to set up an agenda for Wednesday, November 9 in the 3rd Floor computer room. The demos will be in the form of a webinar. Ms Williams stated that the demos will feature pension administration, the retirement calculator and web site estimator, reports and data conversions. Ms. Williams updated the Board that the external drive to back up the retirement data files has been purchased and implemented. Trustee Rose requested that a memo be drafted to the IT Department for the Retirement System computer system to be purchased. Employees Retirement System Regular Meeting of October 20, 2011 Page 4 Karen Williams reviewed the Investment and Securities Lending Monthly report for September 2011. It was moved by Trustee Singleton and supported by Trustee Rose to adjourn the meeting. Adopted by the following vote: 7 -0. The meeting adjourned at 9:40 a.m. Minutes approved on Scott Dedic, Chairperson Employees' Retirement System Jerry Ambrose, Secretary Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI November 17, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:41 a.m. Present: Dedic, Kraus, Munroe, Parker, Rose, Singleton - 6 Absent: Trustee Bernero, McCaffery, Robinson Others: Karen E. Williams, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office). It was moved by Trustee Rose and supported by Trustee Singleton to approve the Official Minutes of the Employees Retirement System Board Regular Meeting of November 17, 2011. Adopted by the following vote: 6 — 0. Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 1 retired. Total active membership: 484. Total deferred: 60. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of October, 2011 amounted to $1,687,560.95. Total retirement checks printed for the ERS System: 845. 0 death(s). Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 1. There were no requests for Regular Age & Service Retirements. There were no requests for Duty Disability Retirements. There were no requests for NonDuty Disability Retirements. _5 There were no requests for Refunds of Accumulated Contributions. It was moved by Trustee Rose and supported by Trustee Parker to excuse Trustee McCaffery from the November Employees Retirement System Board meeting. Adopted by the following vote: 6 — 0. Employees Retirement System Regular Meeting of November 17, 2011 Page 2 Trustee Rose provided an overview of IFEBP Conference. Trustee Rose discussed the workshops that he attended, that included financial tracking of investment funds. Trustee Rose reviewed the discussion of defined benefit versus defined contribution plans. Trustee Rose also discussed topics regarding regionalization, trustee liability and responsibility for financial due diligence and active and passive investment management. Trustee Kraus reported that she attended many of the investment sessions. Trustee Kraus discussed the global economy and broader range of investments, asset allocation. Trustee Kraus discussed the Board reviewing the expected rate of return with the actuary. Trustee Kraus was also impressed with Beatrice Berry who provided a keynote session. Trustee Singleton attended most of the health care reform sessions, regarding negotiating and communicating these to employees. Trustee Dedic also informed the board that the IFEBP provided a zip drive of all the sessions that were available at the Annual Conference. Karen Williams informed the Board that MAPERS was providing a One Day Seminar on "Innovative Solutions for Challenging Times", Friday, December 2 at the Westin Book Cadillac, in Detroit, Michigan. Trustee Dedic reviewed the current Travel Policy with the Board and suggested an amendment to increase the annual limit for conferences to $5,000 per year, per Trustees. Trustee Kraus discussed that the increase would allow Trustee to investigate other public sector conferences. Trustee Singleton suggested that the Travel Policy be amended to an annual limit of $6,000 due to the increase costs of travel, baggage, food at these locations. It was moved by Trustee Rose and supported by Trustee Parker to amend the Travel Policy annual conference limit to $6000 per year, per trustee. Adopted by the following vote: 6 — 0 Attorney Ken Lane informed the Board that he will update the Trustee Book at the next meeting. Employees Retirement System Regular Meeting of November 17, 2011 Page 3 Karen Williams distributed a memo from Angela Bennett, Finance Deputy Director and reported to the Board that on October 31, 2011, the City Contribution was made to the Retirement System. The Contribution was $7,414,000 minus $500,000 of the budgeted amount pending results of the actuarial valuation, so as not to over contribute in a volatile stock market. It was moved by Trustee Rose and supported by Trustee Parker to accept the Finance Department memo and recognize the City Contribution to the Retirement System. Adopted by the following vote: 6 - 0. Karen Williams reported to the Board that Mr. Davenport contact the Retirement Office by phone to request his retirement contributions from the Employees Retirement System. Ms. Williams inquired when Mr. Davenport had been a member. Mr. Davenport reported that he had been a member in 1965 - 1966. Ms. Williams informed Mr. Davenport that the Ordinance provides that retirement contributions can only be refunded if requested within five years of separation. Ms. Williams sent Mr. Davenport a copy of the Retirement Ordinance. Mr. Davenport recently contacted the Retirement Office again stating that he did not receive the information and he wanted correspondence from the City to review with his Attorney. It was moved by Trustee Rose and supported by Trustee Parker for Attorney Ken Lane, Legal Counsel to prepare a letter to send to Mr. Davenport. Adopted by the following vote: 6 -0. Karen Williams reviewed the Investment and Securities Lending Monthly report for Ocotber 2011. It was moved by Trustee Rose and supported by Trustee Singleton to adjourn the meeting. Adopted by the following vote: 6 -0. The meeting adjourned at 9:16 a.m. Minutes approved on Jerry Ambrose, Secretary Employees' Retirement System Scott Dedic, Chairperson Employees' Retirement System OFFICIAL PROCEEDINGS OF THE BOARD OF TRUSTEES CITY OF LANSING EMPLOYEES' RETIREMENT SYSTEM Regular Meeting City Council Conference Room 10th Floor, City Hall Lansing, MI December 15, 2011 Thursday, 8:30 a.m. The Board met in regular session and was called to order at 8:40 a.m. Present: Dedic, McCaffery, Munroe, Parker, Rose, Singleton (8:41)- 6 Absent: Trustee Bernero, Kraus, Robinson Others: Karen E. Williams, Angela Bennett, Finance Department; Attorney Kenneth Lane, Clark Hill (representing the City Attorney's Office); Gregory Stump, Karen Earley, EFI Actuaries. It was moved by Trustee Parker and supported by Trustee Rose to approve the Official Minutes of the Employees Retirement System Board Regular Meeting of November 17, 2011 as amended. Adopted by the following vote: 6 - 0 It was moved by Trustee Parker and supported by Trustee Singleton to approve the Official Minutes of the Joint Employees Retirement System and Police and Fire Retirement System Board Meeting of November 17, 2011. Adopted by the following vote: 6 — 0. Secretary's Report. 0 new member(s), 0 reinstatement(s), 0 refund(s), 0 transfers, 0 retired. Total active membership: 484. Total deferred: 61. Refunds made since the last regular meeting amounted to $0.00. Retirement allowances paid for the month of November, 2011 amounted to $1,682,537.28. Total retirement checks printed for the ERS System: 843. 4 death(s). Joyce A. Borseth, died 9/12/2011, age 83, spouse of Exempt retiree, Fred Brown, died 10/7/2011, (T580 CTP — retired 9/12/1992), age 76, no beneficiary; Lawrence Havens, died 11/19/2011 (NonBargaining — retired 7/20/1984), age 84, no beneficiary; Kenneth N. Dilts, died 10/30/2011 (UAW —retired 11/14/1992), age 78, spouse to receive 100%. Eligible domestic relations orders received: 0. Domestic relations orders pending: 0. Eligible domestic relations orders certified: 0. Employees Retirement System Regular Meeting of December 15, 2011 Page 2 It was moved by Trustee Rose and supported by Trustee McCaffery to approve the following requests Regular Age & Service Retirements: Michelle Reddish, Police/Civilian — Teamster 214, 21 years, 11 months or service of credits, age 48, effective December 27, 2011. (65 points, Old Plan) John Green, Finance — Teamster 580, 12 years, 3 months or service credits, age 62, effective November 30, 2011 (Non -Duty Death, New Plan) Adopted by the following vote: 6 — 0. There were no requests for Duty Disability Retirements. There were no requests for Non -Duty Disability Retirements. There were no requests for Refunds of Accumulated Contributions Trustee Parker provided an overview of the MAPERS One Day Conference held December 2, 2011. The Seminar was entitled "Innovative Solutions for Challenging times. The Seminar includes issues regarding questions assumptions, trustee education, lessons from poorly run plans, fiduciary liability, active managements, implementing beneficial change. Trustee Rose provided an overview of the due diligence visit to Asset Consulting Group, December 6 7. Trustee Rose informed the Board that it was very insightful to meet the support team, and view the infrastructure. The trustees met with the analysts who make recommendations for client. Trustee Rose was impressed that employees were able to express their ideas and opinions in an open forum. Trustee Parker also included that Asset Consulting Group offered to review the investment and actuarial rate assumptions with the Board. Trustee Singleton and Trustee Dedic concurred that the due diligence visit was very informative and encouraged that all members to attend these visits. Gregory Stump and Karen Earley distributed and presented an overview of the Actuary valuation, ending December 31, 2010. Ms. Earley provided an actuarial background regarding pension funding. Ms. Earley discussed the prior match of data with former actuary, Gabriel, Roeder and Smith. Mr. Stump also discussed the current valuation and future funding and recommendations. Mr. Stump discussed that EFI will have more information once the Experience Study is completed. Mr. Stump discussed with the Board implementing a funding policy. He also provided a schedule for upcoming studies, valuations and meetings for the next year. Employees Retirement System Regular Meeting of December 15, 2011 Page 3 Attorney Ken Lane reviewed the modified Travel Policy with the Board and suggested an amendment to increase the annual limit for conferences to $6,000 per year, per Trustees. There is a still $3000 limit per conference. Trustee Dedic inquired if the Travel Policy could be amended or suspended with Board approval for specific conferences. Attorney Lane opined that the Board could suspend the Travel Policy with approval of the Board. Trustee Singleton suggested that the Travel Policy be amended to an annual limit of $4,000 per conference due to the increase costs of travel, baggage, food at these locations. It was moved by Trustee Singleton and supported by Trustee Rose to amend the Travel Policy annual conference limit to $4000 per year, per conference, per trustee. The total annual limit for conferences would be $6,000 per year. Adopted by the following vote: 6 — 0 Attorney Ken Lane informed the Board that he will update the Trustee Book at the next meeting. Attorney Lane discussed Trustee Liability Insurance as a fudiciary to the system. Michigan has a statue of governmental immunity that protects Trustees in the performance of their duties. Additionally, The City Council budget policy recognizes Trustees are covered by the City while performing the scope of your duties, exception include fraudulent behavior or gross negligence. It was moved by Trustee Rose and supported by Trustee Parker to move into Executive Session to discuss an investment manager issue of Attorney -Client privilege. Adopted by the following roll call vote: 6 — 0 Yes: Dedic, McCaffery, Munroe, Parker, Rose, Singleton No: None The Board went into Executive Session at 9:41 a.m. The Board rose from closed session at 9:54 a.m. Karen Williams reported that the Joint Committee for Special Projects will view two Pension Software demonstrations, December 20, 2011: Tegrit 9 — 11:30, Byrne 1-2:30 p.m. Karen Williams reviewed the Investment and Securities Lending Monthly report for November 2011. It was moved by Trustee Singleton and supported by Trustee McCaffery to adjourn the meeting. Adopted by the following vote: 6 -0. The meeting adjourned at 9:59 a.m. Minutes approved on Scott Dedic, Chairperson Employees' Retirement System Jerry Ambrose, Secretary Employees' Retirement System