2024-02-22-RB-min - Laserfiche WebLink

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Minutes of the February 22, 2024 Retirement Board meeting: Present: Robert Cunha, Joseph Foley, Alan Fields, Frederick Weiss, Michelle Malone and Jim Condon Absent: Carolyn Kosnoff The Lexington Retirement Board met remotely through Zoom tele-conferencing. The Town Clerks Office posted the meeting, which included the information for any interested party to join the call. Robert Cunha, Joseph Foley, Alan Fields, Frederick Weiss, James Condon and Michelle Malone were present for this meeting. Robert Cunha called the meeting to order at 8:30 am. The Board accepted the 022924 Warrant and the February payroll. The January minutes were reviewed and approved. The Financial cashbooks were unavailable at the time of the meeting. Robert Cunha reviewed the February agenda with all Board members and staff in attendance. It was noted the Retirement Board received three (3) distributions. A White Oak distribution on 12/28/23 in the amount of $13,133.00, a Golub distribution on 01/29/24 for $143,335.00, and an Angelo Gordon distribution 01/31/24 for $180,177.00. The annual COLA discussion and approval vote has been tabled until the March 28, 2024 meeting. Marianne Reamer submitted the necessary paperwork and request to the Board for a service purchase. She seeks to buyback two (2) years and four (4) months of service from her time working as an Instructional Assistant with LPS. Total cost is $12,351.05. Robert Cunha made a motion to approve the buyback, which was seconded by Joseph Foley, and unanimously approved by Fred Weiss and Alan Fields. James Condon will notify Ms. Reamer of the decision and the payment process. Stephen MacLellan and Henry Juang presented the Meketa update at 8:38 am. The portfolio balance as of January 31, 2024 was $220,693,986.00, down slightly by $71,752.00. The month of January was a mixed bag, nothing out of the usual. Domestic Equities were up 2%, while International Equities were down 1.6%. Global Equity Assets were off by 2.5% and Fixed Assets remained flat. One note is the Fidelity Contrafund remains up and working well for the portfolio in this growth market. It is up 36% over the past 12 months. Stephen went over some quick points within the market as of late. Major central banks have largely paused interest rate hikes. The expectation this year is for banks to cut rates. Inflation pressures have receded in most countries, but uncertainty remains. China has moved further into deflationary territory in January 2024. The Bond market experienced selling pressure over the past month, but finished January relatively unchanged. Key issues in 2024 will be the path of inflation and monetary policy, China’s economic disorder & slowing growth, many looming elections, and the wars in Israel and Ukraine. Lastly, as of December 31, 2023, approximately 2.6% of the total Fund was invested in fossil fuels. His presentation wrapped up at 8:57 am. Peter Kenny and Megan Chadwick presented the Golub review at 9:00 am. Currently, Golub has over $65b in Capital Under Management with offices located across North America, Europe and Asia. Their focus is on First Lien First Out senior secured floating rate loans via private equity sponsor-backed companies with $10m - $100m of EBITDA. They seek to generate consistent net returns and current income by maintaining low defaults and credit losses. In 2023, the strategy performed well with 13% net returns and zero defaults. The national default rate was 3.8% in 2023. Ninety percent of Golub customers are repeat customers for their loans. They focus on the companies they trust to being in