Minutes - 01/20/2016 - Police Pension Fund BoardVILLAGE OF OAK BROOK
BOARD OF TRUSTEES OF THE POLICE PENSION FUND - Minutes
JANUARY 20, 2016
UNOFFICIAL UNTIL APPROVED AS WRITTEN X
OR AS AMENDED BY BOARD OF TRUSTEES OF THE
POLICE PENSION FUND ON March 9, 2016
1. CALL TO ORDER:
The Regular Meeting of the Board of Trustees of the Oak Brook Police Pension Fund was called
to order by President Vel Torlo at 7:02 p.m. in the Upper Level Conference Room of the Samuel
E. Dean Board Room of the Butler Government Center, 1200 Oak Brook Road, Oak Brook,
Illinois.
2. ROLL CALL:
The roll was called with the following persons
PRESENT: President Vel Torlo, Vice President Alan Feldman, Trustee Hitesh Patel, Secretary
Edward Caspers (via teleconference), Trustee Ben Kadolph
ABSENT:
IN ATTENDANCE: Finance Director/Treasurer Sharon Dangles, Courtney Cervantes, Jeff
Kowalczyk and Bill Lowery of Lowery Asset Consulting, LLC, Bob Thompson and Bob
DeMeulenaere of MB Financial, Police Pension Clerk Rose Kane
4. PRESIDENT’S COMMENT: None presented
5. APPROVAL OF MINUTES:
a. Approval of Board of Trustees Regular Board Meeting Minutes of October 14, 2015
Motion by Vice President Feldman, seconded by Trustee Kadolph, to approve the Minutes
of the October 14, 2015 Regular Board Meeting as written. VOICE VOTE: Motion carried.
6 CONSENT AGENDA:
All items on the Consent Agenda are considered to be routine in nature and will be enacted in
one motion.
a. Approval of September 1-30, 2015 expenditures in the total amount of $209,992.86
b. Approval of October 1-31, 2015 expenditures in the total amount of $210,408.12
c. Approval of November 1-30, 2015 expenditures in the total amount of $196,683.85
d. Approval of Lowery Asset Consulting, LLC's invoice in the total amount of $7,000.00, dated
August 3, 2015 for Second Quarter, 2015 services
e. Approval of Lauterbach & Amen, LLP’s invoices in the total amount of $3,075.00, for services
rendered July, August and October, 2015
f. Approval of Reimer, Dobrovolny & Karlson, LLC invoices dated September 11, 2015 and
November 25, 2015, in the total amount of $1,156.40
g. Approval of Illinois Public Pension Fund Association’s 2016 membership dues’ invoice in the
amount of $795.00
h. Approval of The Mitchell Group’s invoice dated October 5, 2015, in the amount of $2,710.01
i. Approval of Pension Clerk Kane’s timesheet in the total amount of $606.25 for services
rendered January through June, 2015
j. Approval of MasterCard charge of $551.20 on October 15, 2015, for 2016 Pension
Conference Lodging
k. Approval of reimbursement to Board Member for mileage to/from 2015 Pension Conference,
in the amount of $163.30
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
Minutes Page 1 of 4 January 20, 2016
l. Approval of Illinois Professional Firefighters Association November 6, 2015 pension seminar,
in the amount of $160.00
Motion by Trustee Patel, seconded by Trustee Kadolph, to approve the Consent Agenda.
ROLL CALL:
Ayes: 5 – Vice President Feldman, Secretary Caspers, Trustee Patel, Trustee Kadolph,
President Torlo
Nays: 0 – None
Absent: 0 – Motion carried.
7. ITEMS REMOVED FROM CONSENT AGENDA – None presented.
8. UNFINISHED BUSINESS – None presented.
9. NEW BUSINESS
a. Lowery Asset Consulting, LLC Report for Fourth Quarter, 2015
Mr. Lowery discussed the fourth quarter’s performance and referred to page 17 of the report and
stated that the Fund was up 2.6% for the quarter. Ms. Cervantes provided a hand-out regarding
Morningstar Fund Category Returns’ year-to-date performance. Mr. Lowery remarked about the
quarter’s positive performance of recently added T. Rowe Price New America Growth, returning
10.4%, Ridgeworth Large Cap Value seeing a 6.73% return and Nuveen Real Estate maintaining
momentum at 7.73% return for the quarter (page 12 of the report). He then discussed the volatility
in the quarter, and talked about the falling oil prices and the Fed’s decision to raise interest rates.
Per Section I. Executive Summary of the Report, page 11:
The Fund investment assets at MB Financial had a value of approximately $31,705,444 as of
December 31, 2015. The current allocation is 63% Equity and 37% Fixed Income and Cash
as defined by the Illinois State Statute. The current portfolio allocation:
41.2% Fixed Income (includes PIMCO Mutual Fund)
26.4% Domestic Large Cap Equity
6.5% Domestic Small Cap Equity
17.3% International
3.3% Energy
5.3% Real Estate
Mr. Lowery stated that in relation to the Schwab Small Cap Index Fund, they are looking for
active managers, specifically, T. Rowe Price, and also talked about recommending William Blair
as a replacement for Harbor in the International funds. He also discussed the performance data
listed on pages 18 and 19 of the report.
b. MB Financial Investment Management Performance Report on Fourth Quarter, 2015
Mr. Thompson discussed that the two best performers in fixed income for the quarter was
Taxable Illinois Municipal bonds and the corporate bonds.
Per page 11 of MB’s report, the Portfolio Composition as of December 31, 2015:
Total Fund: 11,872,520
Fixed Income: 11,310,222
Cash & Equiv: 562,302
Mr. DeMeulenaere talked about the high yield corporate bonds in the portfolio and the
performance of the energy bonds and trading strategy. He referred to Gilead and Oracle time
weighted returns on page 16 of the report. Discussion ensued.
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
Minutes Page 2 of 4 January 20, 2016
Vice President Feldman requested some information about what occurred with the recent move
from DF Dent.
c. Approval of Investment Transactions for Fourth Quarter, 2015
Motion by Trustee Patel, seconded by Vice President Feldman, to approve the Investment
Transactions for the Fourth Quarter, 2015.
ROLL CALL:
Ayes: 5 –Trustee Kadolph, President Torlo, Vice President Feldman, Secretary Caspers,
Trustee Patel
Nays: 0 – None
Absent: 0 – Motion carried.
d. Ratification of 2016 Pension Increases
Motion by Trustee Patel, seconded by Trustee Kadolph, to ratify the 2016 Pension
Increases.
ROLL CALL:
Ayes: 5 –President Torlo, Vice President Feldman, Secretary Caspers, Trustee Patel, Trustee
Kadolph
Nays: 0 – None
Absent: 0 – Motion carried.
e. Discussion/Action regarding Lauterbach & Amen, LLP renewal
Pension Clerk Kane mentioned that none of the actuarial representatives had responded to an
email. After a brief discussion, there was onsensus to determine if there is an issue, and if there
is no problem, to renew the contract.
In response to Vice President Feldman’s inquiry above about the move from DF Dent to T. Rowe
Price, Mr. Lowery stated that when they left DF Dent in the fourth quarter, it was up 4.6, and went
to T. Rowe who was up 6.4. He added that Prime Cap was up 6.6. Vice President Feldman
requested that when there are moves, a short summary be provided in the next quarter’s report.
f. Discussion/Action regarding Request for Proposal
Pension Clerk Kane stated that she had not sent out the RFPs because she was waiting for to
see if anyone had amendments to the document. Consensus to send it out.
10. INFORMATION & UPDATES
a. Scheduling of Second quarterly meeting in 2016:
Potential April dates: April 13th, 20th or 27th
Consensus to meet on April 27, 2016.
Pension Clerk Kane requested that the Board email her their unavailable dates to attend a special
actuarial meeting in February or March, if needed.
Finance Director/Treasurer Dangles stated that she sent Todd Schroeder the police census data
on January 18th to prepare the actuarial report. She affirmed that she had not received any
response either.
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
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Finance Director/Treasurer Dangles and the MB Financial representatives exited the meeting at
approximately 7:49 p.m.
11. ADJOURNMENT:
Motion by Trustee Patel, seconded by Trustee Kadolph, to adjourn the Board of Trustees
of the Police Pension Fund meeting at 7:50 p.m. VOICE VOTE: Motion carried.
ATTEST:
Benjamin Kadolph /s/
Benjamin Kadolph, Acting Secretary
Board of Trustees of the Police Pension Fund
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
Minutes Page 4 of 4 January 20, 2016