Fort Walton Beach Council minutes — 08-22-07 special minutes — reading text

recommendation that a competitive selection process should be used for all extemal service providers that the law does not require a competitive selection process; however, it is a good practice in selecting the professionals. He believed there is some disagreement on 5c that the cost of services should be reviewed and specifically approved by the Board of Trustees. He noted that 5c recommendation that the Plan' s current directed brokerage program should be reviewed is with Merrill Lynch, and it has to do with how they are compensated. He said he spoke with Merrill Lynch about it and he looked at the contract. He mentioned that Merrill Lynch has revised the way they do the directed brokerage which essentially gives them commissions that off-set the fee they are paid under the contract. He thought that could be more transparent so that the City knows exactly what is being paid. He recommended that the contract be reviewed.  8- 22- 07 105 Special Council GENERAL EMPLOYEES PENSION FUND cont. Mr. Minich moved to direct the Pension Attorney review the contract and return with his recommendations. Dr. Pullen seconded motion. The Finance Director expressed her understanding that Council is now changing the direction of the AdvisoryCommittee so if she had issues with investments, etc., she would not take them to the Advisory Committee, and staff would bring them to Council. She wished to know if Council would consider looking at a competitive process in selecting the Financial Advisor. She said choosing a Financial Advisor on performance and there is never a bad reason to go out and compare the performance of the current Financial Advisor with other people. She said before the City automatically renewed a contract with Merrill Lynch she would have to say she would recommend to Council to look around to make sure the services theyare gettingand what they have now are the best possible services they can have for the pension fund. It was noted the motion is to review, not renew, and the hope was expressed that the City Manager and Finance Director would keep Council advised as to the performance of the Financial Advisor of the Plan. The Mayor called for the vote on the motion and it carried unanimously with Holmes, Miller, Reeves, Garvie, Pullen, Hartwell, and Minich in favor. Mr. Linn went over recommendation 6 that continuing education for the Advisory Committee should be made a priority. He commented the point that has been made is that the education should be commensurate with the duties of the committee. He took it that if the consensus of the Council is that the committee does not be performing investment related functions, then it does not make sense to send are typically programs available any committee members to investment related programs. He said those for pension trustees. Mr. Tierney mentioned it is not to say it would not be appropriate for the advisory committee to learn about administrative functions. In response to the question of the impact to the budget for training, the City Manager expressed her to come out opinion that the expense for the Board of Trustees training would be an allowable expense of the pension fund. Mr. Linn asked if Council wished to address the Retirement Plan Options he mentioned in his report. The City Manager mentioned during the budget meeting in Maya variety of different pension options were discussed and Council told staff to stay the course. She suggested in January or February, well in advance of the budget preparation, to look at the options which Mr. Linn to give a comparative analysis on the optionsat that time, then if Council wanted to change it for the 08/ 09 year they would have the information well in advance. Mr. Linn was requested to also provide information on combinations of the Plans, and any relationship with social security. Mr. Linn acknowledged he will provide information on a combination of plans, and explained that the City is locked in on social security and that is no irrevocable. The Mayor reviewed that a motion was passed to go to the payment delayed methodology, that there was no action taken on recommendations 1 and 2, a motion was passed to perform a peer- review every there action taken recommendation 4, on recommendation 5 a motion was passed five years, was no on to direct Mr. Linn to review the current contract with the fiduciary agent, and on recommendation 6 training is available. Mr. Linn, Ms. Balant and Mr. Tierney were thanked for the information provided.