Minutes - 04/21/2014 - Police Pension Fund BoardVILLAGE OF OAK BROOK
BOARD OF TRUSTEES OF THE POLICE PENSION FUND - Minutes
April 21, 2014
UNOFFICIAL UNTIL APPROVED AS WRITTEN
OR AS AMENDED BY BOARD OF TRUSTEES OF THE
POLICE PENSION FUND ON May 5, 2014
1. CALL TO ORDER:
The Regular Meeting of April 21, 2014 of the Board of Trustees of the Oak Brook Police Pension Fund was
called to order by President Torlo at 7:00 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, Secretary Edward Caspers, Trustee
Hitesh Patel, Trustee Benjamin Kadolph
ABSENT: None
IN ATTENDANCE: Spencer Klein, Bob Thompson and Jim Hrabak from MB Financial, Village Trustee
Jerry Wolin, Derek Flessner from Lauterbach & Amen, LLP, Pension Clerk Rose Kane
3. PRESIDENT'S COMMENTS:
Trustee Patel presented the election report and announced that Vel Torlo, Ben Kadolph and Ed Caspers
were all re-elected with the votes as follows:
For the Retired Candidates: Caspers-20, Laatz-8
For the Active Candidates: Torlo-24 votes, Kadolph-19 votes, Kaleciak-9, Perez-6
4. APPROVAL OF MINUTES:
a. Approval of Board of Trustees Regular Meeting Minutes of January 22, 2014
Motion by Secretary Caspers, seconded by Trustee Kadolph, to approve the Minutes of the January
22, 2014 Regular Board Meeting as amended. VOICE VOTE: Motion carried.
b. Approval of Special Joint Meeting Minutes of March 6, 2014
Motion by Trustee Patel, seconded by Secretary Caspers, to approve the Minutes of the March 6,
2014 Special Joint Board Meeting as amended. VOICE VOTE: Motion carried.
c. Approval of Special Joint Meeting Minutes of March 13, 2014
Motion by Secretary Caspers, seconded by Vice President Feldman, to approve the Minutes of the
March 13, 2014 Special Joint Board Meeting as amended. VOICE VOTE: Motion carried.
5 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 January 1-31, 2014 checks in the total amount of $221,102.91
b. Approval of February 1-28, 2014 checks in the total amount of $186,620.06
c. Approval of March 1-31, 2014 checks in the total amount of $183,207.75
d. Approval of Lowery Asset Consulting, LLC's invoices in the total amount of $7,000.00, dated December
19, 2013 for Fourth Quarter, 2013 services
e. Approval of Lauterbach & Amen, LLP’s invoices in the total amount of $4,225.00, for services rendered
August, November and December, 2013 and January, 2014
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
Minutes Page 1 of 3 January 22, 2014
f. Approval of Contravisory Investment Management, Inc. invoice for the period January 1 through March
31, 2014 in the amount of $2,521.00
g. Approval of Reimer & Karlson, LLC invoice in the amount of $131.25
h. Approval of Reimbursement to Pension Clerk Kane for one Trustee to attend February, 2014 pension
seminar in the amount of $150.00, and miscellaneous costs advanced in the total amount of $110.07
Motion by Trustee Kadolph, seconded by Trustee Patel, 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 – None. Motion carried.
6. ITEMS REMOVED FROM CONSENT AGENDA – None presented.
7. UNFINISHED BUSINESS
a. Discussion of 2014 Actuarial Assumptions’ Recommendations to Village Board
The above Agenda Item was discussed after Agenda Item 9.a.
Village Trustee Wolin discussed the differences in the actuarial reports, specifically, that the Village’s
actuary (Foster & Foster) came up with $400,000 ($1.6 million contribution) more than the Police Pension
Board’s actuary. Discussion ensued regarding reasons for the differences and that there is a difference of
$700,000 between the two reports for the Firefighters Pension. Demographics, disabilities and using
different actuarial tables were listed as possible reasons for the discrepancy. It was stated that the
Village’s actuary utilized the RP2000 Blue Collar table and Lauterbach utilized a 2012 table specific to
police officers in Illinois. Trustee Wolin stated that the biggest difference was the calculation method used,
for example, Lauterbach used the Entry Age Normal method and the Foster & Foster used the Projected
Unit Credit method, with the main difference being whether more is funded now or later.
8. NEW BUSINESS:
a. Lowery Asset Consulting, LLC Report on First Quarter, 2014
Due to a miscommunication, no representatives from Lowery Asset Consulting were present.
b. MB Financial Investment Management Performance Report on First Quarter, 2014
Bob Thompson of MB Financial referred to the Executive Summary on page 1 of MB’s report and stated
that the fixed income portion of the portfolio as of March 31, 2014 was $12,201,077 and discussed the
Account Activity Summary on that same page, ending up with a positive $137,274 for the quarter.
Jim Hrabak introduced Spencer Klein of MB Financial and stated that Mr. Klein would be taking the reins
going forward while Mr. Hrabak would be focusing more on internal investment strategy.
Spencer Klein discussed that the strategy and process would be the same and talked about recent current
events and their effect on the bond portfolio. He reviewed the highlights of the returns for the first quarter
of 2014 on page 2 and their strategy. He then discussed pages 7 and 8, the Market Value vs. Invested
Capital and the Risk/Return Analysis, respectively, for the Total Fund. Mr. Klein then explained the Equity
Outlook on page 4 of Economy, Markets and Outlook section of MB’s report and referred to page 5 of that
section – the U.S. Treasury Yield Curve of the Fixed Income Overview. There was some discussion
regarding the bond holdings, specifically taxable municipal bonds and high yield bonds.
c. Approval of Investment Transactions for First Quarter, 2014
There was discussion regarding perhaps setting up a conference call and there was consensus to have
Lowery provide information regarding the First Quarter, 2014 Investment Transactions at the special dinner
meeting on May 5th.
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
Minutes Page 2 of 3 April 21, 2014
Representatives from MB Financial exited the meeting at approximately 7:35 p.m.
Motion by Trustee Kadolph, seconded by Secretary Caspers, to table the Lowery Investment
Transactions until May 5th. VOICE VOTE: Motion carried.
d. Approval of Application for Members Pension Benefits Retirement Pension of Mary Jo Nugent
Motion by Secretary Caspers, seconded by Vice President Feldman, to approve the application for
Members Pension Benefits Retirement Pension for retired sergeant, Mary Jo Nugent.
ROLL CALL:
Ayes: 5 – Secretary Caspers, Trustee Patel, Trustee Kadolph, President Torlo, Vice President Feldman
Nays: 0 – None
Absent: 0 – None. Motion carried
e. Approval of contribution refund to Stephen Peterson
Motion by Trustee Kadolph, seconded by Secretary Caspers, to approve the contribution refund for
Stephen Peterson.
ROLL CALL:
Ayes: 5 – Trustee Patel, Trustee Kadolph, President Torlo, Vice President Feldman, Secretary Caspers
Nays: 0 – None
Absent: 0 – None. Motion carried
f. Discussion regarding creditable service reports to active pension members
Derek Flessner discussed the annual reports which could be prepared for the active pension members.
There was some discussion regarding furlough days and other breaks in service and information should be
verified from the Village HR files. Mr. Flessner stated that the cost of providing annual member statements
to the actives would cost around $600-$800, but that he would obtain a quote for same.
9. INFORMATION & UPDATES
a. Scheduling of third quarterly meeting in 2014
Tentative Wednesday dates in July, 2014: July 16th, 23rd and 30th
Pension Clerk Kane updated the Board on the status of the responses regarding the May 5th Members’
Dinner. Consensus to meet on July 23rd for the regular third quarterly meeting.
10. ADJOURNMENT:
Motion by Vice President Feldman, seconded by Secretary Caspers, to adjourn the Board of
Trustees of the Police Pension Fund meeting at 8:17 p.m. VOICE VOTE: Motion carried.
ATTEST:
Edward Caspers /s/
Edward Caspers, Secretary
Board of Trustees of the Police Pension Fund
BOARD OF TRUSTEES OF THE POLICE PENSION FUND
Minutes Page 3 of 3 April 21, 2014