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MINUTES <br />CITY COUNCIL <br />DECEMBER 8, 2004 <br />The Administrator next reviewed the Maximum Benefit Worksheet noting <br />the current $3,000 per year of service benefit level. He explained that this <br />is a statutory maximum. based on the average revenue per fire fighter from <br />the last three years. It is not an actuarial projection intended to indicate <br />what the benefit level for the relief association should be. He further <br />pointed out that with the 2004 required city contribution of over $41,000 <br />and the increase in Fire State Aid, the maximum benefit calculation on <br />next year's SC04 will be $3,900 per year of service. <br />Next reviewed were reporting formats, specifically the quarterly summary <br />and investment reports provided by the financial advisor. The intent of the <br />quarterly report is to track progress of investment earnings. He noted that <br />with the SC04 assumptions, a five percent return is the smallest yield we <br />should expect. This report will provide a quick way for everyone to see if <br />we are meeting our yield objectives. He also pointed out that the reports <br />provided by the financial advisor have excellent information and should be <br />reviewed in detail to evaluate the performance of the various investment <br />instruments. <br />The Administrator provided a proposed Investment Ratification Procedure <br />for review and comment which addressed reinvestments of existing CD's, <br />stock funds, bonds, collateralized mortgage obligations, and government <br />agencies. The Procedure also addressed the investment of funds not <br />previously invested or held in money market funds. The consensus of <br />those present is that this procedure should be adopted by the Trustees at an <br />upcoming meeting. <br />The City Administrator also recommended the creation of a formal <br />investment policy. (A copy of guidelines prepared by the State Auditor <br />was given to Joe Vitale.) The goal in creating an Investment Policy is to <br />address and clarify the allocation of assets, types of funds, and the level of <br />aggressiveness in terms of risk. <br />Joe Vitale noted that the Relief Association already has an investment <br />policy. A quick review was conducted of that document. One change <br />suggested was to not grant the financial advisor "complete discretion" in <br />the making of investment decisions. Everyone agreed that all of the <br />Trustees need to be involved in making these types of decisions after <br />reviewing pertinent information. Council members did commend the <br />Relief Association for already having an investment policy in place. <br />The Administrator presented detailed information relative to the Relief <br />Association's investment performance including the role of the <br />Association's financial advisor in these outcomes. There was detailed <br />discussion related to the financial advisor's role as well as the <br />appropriateness of some investments. Fahey noted the poor performance <br />