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HomeMy WebLinkAboutCity Council Committees - Fireman's Relief and Pension Board - 03/01/1995 Firemen's Relief & Pension Board March 1, 1995 Present: Gary Tilley, Charles Turner, Don Fronsdahl, James Smail, May Miller, Susan Narrick, Gene Grenstad, Brenda Jacober and Mary Berg (Berg arrived at 9:25) . In the absence of Mayor White, Jacober nominated Gary Tilley as Chair. Grenstad (in the absence of Berg) seconded and the motion carried. Approval of Minutes of February 1, 1995. Brigitte Hoopes asked that the words "new salary schedule" be added to the first sentence of the second paragraph under Report on Retroactive Pay, so that it would read "Murray noted that 1994 calculations are now invalid since the Firefighters Union settled the new salary schedule, and that they will be redone" . There were no objections. Hoopes also asked that a sentence be added to the end of this portion of the minutes, stating that "For 1994, 1099's are/were mailed to non-duty disabled and widows only" . It was noted that this was not a part of the minutes, and that it is only for clarification. TILLEY MOVED to clarify the minutes, Grenstad seconded and the motion carried. GRENSTAD THEN MOVED to approve the minutes of February 1, 1995, as amended and clarified. Tilley seconded and the motion carried. Approval of Financial Transactions. Murray distributed copies of month-end reports for January showing the investment schedule, operating revenues and expenditures, and assets and liabilities. JACOBER MOVED to approve the financial transactions. Grenstad seconded and the motion carried. Report on Retroactive Pay. Murray distributed copies of Mr. Turner's report through February 28, 1995, and noted that she has reviewed the figures. She said if the Board approves the report, the payments will be included in the checks issued March 3rd. She noted Donald/Celestine Bridge's credit was forgiven through 12-31- 93 and that he will get a payment of approximately $1000 for 1994 and 1995, and that Robert See was forgiven through 12-31-93 but will not get retro payments for 1994 or 1995. Tilley said that if we continue to pay Mrs. Bridge, the debt service will continue to increase. Murray noted that Mrs. Bridge will receive a monthly allowance of $214 . 27 starting March 1st, and that the overpayment totals $7,745. 77. Tilley noted that technically Mrs. Bridge is being overpaid since the Board does not have the right to forgive. Miller said an option would be to apply 50% of what Mrs. Bridge is due toward that past amount. He noted that Mrs. Bridge has a benefit coming and as long as she owes the Board more than the benefit, she is being overpaid. Tilley noted for Grenstad that the maximum that can be taken for repayment is 50% of what is owed. Grenstad suggested taking out the minimum amount possible. Tilley opined that authorizing more payments today would simply be making the problem worse. Murray noted that as of December 31, 1993, Mrs. Bridge was overpaid by $8 , 685 . 02, and the credit is reduced by applying 1994 and 1995 payments. She noted that Mr. See was forgiven in the amount of $300.45, and that Mr. OrndorfffIs circumstances are different and it will take 6-1/2 months to repay at 500. Tilley noted that Mrs. Bridge is entitled to $214 . 00 a month but has only been receiving $104. 18, so 50% could be applied and she would not be aware of it, since she has not received the full amount. He said that if he had more knowledge when the original motion was made to forgive the amount, he may have voted differently. Berg noted that the Board consulted with their legal advisor and acted in good faith, and he is not in favor of changing anything. He said a decision should be made now as to how to handle things in the future. Turner noted that according to the City Attorney, the justification for forgiving Mrs. Bridge's amount was that she was not in a position to repay. Berg suggested reminding Mrs. Bridge that nearly $8, 000 was forgiven, informing her that she was underpaid by $1000, and suggesting that the $1000 be applied to the $8000 overpayment and starting fresh. It was noted that she would then be paid $214 per month. BERG MOVED to apply the amount of money owing to Mrs. Bridge against the money that was overpaid and start paying the benefit that is owed her beginning March 1, 1995. He clarified that $939 .25 would be applied to the amount that was forgiven, and that payments of $214 . 27 would begin on March 1st, Jacober seconded and the motion carried. TILLEY MOVED to forgive Mr. See of $300.45, and that the amount of credit owed by Mr. Orndorff will be deducted at 50% until paid back. Berg seconded and the motion carried. Murray agreed to write a letter to Mr. Orndorff explaining how much he owes, how much is being deducted, and how long it will take to pay it off. Murray clarified that she rounded the numbers up to the nearest 50 cents because that is what Turner had done, that she does not usually round them, and that she prefers to use exact numbers. She noted that longevity is added to the base wage. Tilley explained that members need to know how it is calculated. Murray said she is going to change the figures to the exact amount, and agreed to bring the exact figures to the next meeting. TILLEY MOVED to accept the figures presented as the monthly benefit amounts from March 1, 1970 until the next adjustment period. Berg seconded and the motion carried. i Murray presented an invoice in the amount of $875. 00 from Mr. Turner for the extra work performed. BERG MOVED to authorize the payment to Mr. Turner. Jacober seconded and the motion carried. Tilley noted that he has prepared a letter which could be sent out with the checks explaining why members are getting a lump sum. He distributed a copy of the letter to the Boardmembers. Berg made a slight change and Tilley said he will print out a corrected copy. Jacober agreed to run the letter on letterhead and provide copies to Murray. Tilley noted that in the past an arbitrary amount of 5% was chosen for interest on past due monies. BERG MOVED to pay 5% interest on the amount due less the amount of interest that has been previously paid. Jacober seconded and the motion carried. Murray noted that there is not enough time to add interest; there were no objections to adding it on next time. Investments. Finance Division Director May Miller explained that the cash flow of the fund needs to be improved, and proposed selling an investment. She explaine d that the Firemen's Relief & Pension Fund has been allowed to have their money in mutual funds and noted that Putnam Growth and Phoenix Growth were purchased in 1970 and that Oppenheimer Equity and American Capital Pace were purchased in 1986. She said that R. L. Evans has suggested selling other city investments and placing the whole pool in mutual funds. She voiced concern about mutual funds and noted that the top priority is to keep the principle in tact and that mutuals are risky. Susan Narrick then explained mutual funds, noting that their value goes up and down. Miller pointed out that American Capital Pace has decreased in value over the years, and recommended selling it. Upon Tilley's question, Miller said all four of the investments could be sold and invested in CD's or other options. She offered to prepare a cash flow and bring it to the Board, and reiterated that approval to sell one investment right away is needed in order to make the required payments this month. BERG MOVED that the Board authorize the sale of the American Capital Pace fund. Jacober seconded and the motion carried. Berg asked that the Finance Department bring back a proposal on the other funds and Miller agreed. She noted that R. L. Evans may wish to speak to the Board about investments. Meeting Time. It was determined that the next meeting will be held at 9: 00 a.m. on April 5th. Berg noted that he will not be in attendance. Appreciation. Tilley expressed his appreciation to the Finance Department for all they have done and to all involved, particularly Mr. Turner. Adiournment. There was no further business and BERG MOVED to adjourn the meeting at 10: 05 a.m. Jacober seconded and the motion carried. Brenda Jaobr City Clerk/-Boardmember