At the regularly scheduled meeting of the Fire and Police Pension Fund Board of Directors held on the 18th day of August 2016, President Craig Joel presided. The meeting was held at the Pension Office, 6009 John Douglass Drive, Chattanooga, TN 37421.
The meeting convened at 0907 hours with board members Craig Joel, Kelly Simmons, Phillip McClain, Charlie Thomason, Tommy Meeks, Less Lee and Vickie Haley. Attorney Bill Robinson was also present.
Motion by Phillip McClain and seconded by Kelly Simmons to approve the minutes of the July 21, 2016 meeting. Motion carried unanimously.
Attorney Bill Robinson informed the Board that a hearing in the 6th Circuit Court of Appeals for the Frazier Case has been scheduled for September 27, 2016. Assuming a 3-judge panel of the 6th Circuit hears oral arguments on September 27th, Mr. Robinson feels a ruling will be made at a later date. Less Lee asked if the Fund could request the same 3-judge panel that recently ruled in the Kentucky case. Mr. Robinson said no, but that panel did cite Judge Collier’s ruling on Frazier in their ruling on the Kentucky retirement system. Mr. Robinson states that he feels this is favorable to the Fund’s arguments in Frazier at the 6th Circuit.
Less Lee congratulated Bill Robinson on being selected by The Best Lawyers in America as a 2017 Lawyer of the Year in Employee Benefits Law. The other Board members joined in congratulating Mr. Robinson.
Motion by Phillip McClain and seconded by Charlie Thomason to approve the following membership items:
REMOVE FROM THE ROLLS:
Retired Police Sergeant James T. Marlin, effective 07/31/2016, died 08/11/2016 (2-411)
Lydia Jane Richards, surviving spouse of Retired Fire Lieutenant Billy E. Richards, effective 08/31/2016, died 08/07/2016 (2-411)
Retired Fire Lieutenant Alvin L. “Bill” Shoemake, effective 08/31/2016, died 08/11/2016 (2-411)
ADD TO THE ROLLS:
Linda K. Marlin, designated 100% J&S beneficiary of James T. Marlin, effective 08/01/2016 (2-411, 2-418)
REFUND CONTRIBUTIONS:
Former Police Officer Edward F. Hamilton, terminated 07/25/2016, participation date of 09/18/2015 (2-413)
Former Firefighter Ricky Moore, terminated 08/02/2016, adjusted participation date of 11/12/2012 (2-413)
Former Police Officer Matthew C. Duggan, terminated 08/10/2016, participation date of 11/12/2012 (2-413)
APPROVED DISABILITIES:
Firefighter Stacy Brogden, approved for Job Related Disability, effective 08/01/2016, no J&S elected (2-412).
Motion carried unanimously.
The Board reviewed the bills paid since the last meeting.
The Board reviewed the following candidates regarding eligibility for election to the Board of Directors.
Police—Lt. Craig Joel (unopposed)
Fire—FFS Mark Coffman (unopposed)
Both are current Directors on the Board in good standing. Motion by Kelly Simmons and seconded by Charlie Thomason to validate the candidates for election ballots and for the Pension Office to be the sole voting location since both races are uncontested. Motion carried unanimously.
Frank Hamilton reported that in a routine audit of the Plan conducted by the staff, it was discovered that in the past, if a member passed away in December, that the method for calculating the Survivor’s January benefit has been inconsistent. Mr. Hamilton requested that the Board approve the following method going forward:
Calculate the January COLA (if eligible) on the Member’s December benefit;
Apply the J&S Option (if applicable) to the new Member’s rate for the Survivor benefit in January.
The Board discussed Mr. Hamilton’s recommendation. Motion by Vickie Haley and seconded by Phillip McClain to approve the recommendation. Motion carried unanimously.
Kelly Simmons requested of the chair that the Board discuss Less Lee’s failure to meet his educational requirements in each of the last three years, and what effect Mr. Lee’s failure to meet his educational requirements could have on any potential fiduciary liability for other Directors on the Board. At the recommendation of Bill Robinson, President Joel recessed the meeting at 0942 hours to hold an executive legal session to discuss the topic. The meeting reconvened at 1025 hours. Mr. Joel stated that he would grant Mr. Lee’s request to allow him two weeks to decide a course of action. Motion by Phillip McClain that the Board grants no more than two weeks before taking action on Mr. Lee’s non-compliance with the Fund’s Education Policy. The Board discussed the motion. Mr. Simmons stated that he would like to see President Joel take action today in accordance with the policy. Motion failed for lack of a second.
Motion by Phillip McClain and seconded by Kelly Simmons to adjourn at 1032 hours. Motion carried unanimously.
Notes:
Fund returned 2.2% for 2Q-2016; 1% YTD
Future Discussions
DROP Calculation – Employee Contributions
Addressing Member exodus
Pop-up Option and divorce
Review of Investment Benchmarks
Investment Consultant RFP
Annual Trustees Meeting
September 20-21, 2016
Open Board meeting at 1400 hrs on September 21, 2016
