HomeMy WebLinkAbout2023-05-25-RB-min
Minutes of the May 25, 2023 Retirement Board meeting:
Present: Robert Cunha, Joseph Foley, Alan Fields, Frederick Weiss, Carolyn Kosnoff, Michelle Malone
and Jim Condon
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, Carolyn Kosnoff, James Condon and Michelle Malone
were present for this meeting. Chairman Robert Cunha called the meeting to order at 8:30 am.
The Board accepted the 053123 Warrant and the May payroll. The April minutes were reviewed and
approved. The financials were not available at the time of meeting.
Robert Cunha reviewed the May agenda with all Board members and staff in attendance.
It was noted there were three (3) distributions to the Lexington Retirement System. On April 14, 2023, a
distribution of $181,273.00 was received from Angelo Gordon. Golub 9 Fund distributed $90,261.00 on
5/4/2023, while Golub 14 distributed $92,895.00 on 5/5/2023.
Michelle Malone presented a brief update on the office renovation project. Facilities has set the dates
of July 13-14 to work. Talks will continue regarding a paint job for both offices. Jim will be on vacation
the week of renovation, while Michelle will work from home or seek available office space in Town Hall.
Election Officer, Jim Condon, notified the Board only one (1) candidate submitted nomination
paperwork to the Lexington Retirement Office for a three (3) year term to commence on July 1, 2023
through June 30, 2026. Robert Cunha, Chairman, was the only candidate to submit nomination
paperwork by the May 9, 2023 deadline.
A motion was made by Joseph Foley at 8:40 am, seconded by Carolyn Kosnoff, and unanimously passing
4-0. The Board voted Robert Cunha, running unopposed, as elected to serve a three (3) year term
commencing on 07/01/2023 through 06/30/2026. The motion made included that Robert Cunha will
remain the Board Chairman. It was noted this will be Robert Cunha’s thirteenth term on the Lexington
Retirement Board. Joseph Foley, Alan Fields, Carolyn Kosnoff, and Frederick Weiss were all “yes” votes.
Mr. Cunha abstained from the vote.
Vincent LeRow submitted the necessary paperwork to request a buyback of service with the Lexington
Retirement System. Mr. LeRow has requested to purchase four (4) months of service toward his
retirement account. Robert Cunha made a motion to approve the buyback, which was seconded by
Joseph Foley, and unanimously approved by Carolyn Kosnoff, Alan Fields, and Fred Weiss. Mr. LeRow
will receive an accepted by the Board letter and the options to purchase the service.
PERAC Memo #10 reminder to Board members regarding education credits. Sign up for trainings.
Carolyn Kosnoff mentioned to the Board she is exploring options to seek a long term contract with Stone
Consulting Group. Just in the early stages, but would like to see a 4-6 year contract for the future.
Stephen MacLellan presented the Meketa update at 8:45 am. The portfolio balance as of April 30, 2023
was $202,731,383.00, up $3.42m from April. Stephen began by talking briefly with the Board about the
Debit Ceiling standoff going on in Washington. It is no secret that markets and portfolios worldwide will
take a major hit if the matter is not resolved by June 1, 2023. Even if a deal is struck, markets will have a
somewhat negative effect as it could still be too late to pay bills on time in Washington. He mentioned
the Lexington portfolio is somewhat safe based on our holdings. However, no financial market or asset
class will be immune to what is on the horizon if a deal is not struck.
In general terms, our portfolio is set up fine, with no need to make any changes at this time. Domestic
equities are up 8% YTD. Fidelity Contrafund has performed excellent this year, posting a 15.1%, while
the S&P and Russell 1000 are both over 8.8%. International continue to lag. Matthews is a flat 0.3%
YTD, even after posting a negative 3.9% in April. The Global Equity Assets are doing ok. Wellington
Enduring and Opportunistic are both fine. Opportunistic fund is up 7.9% YTD.
Stephen gave the Board an update on the GCP 9 Fund. The market value on this fund is $3.5m as of
04/30/23. Its inception to date net IRR through 03/31/23 was 9.5%. This fund is reaching the end of its
term. The Board needs to decide whether to cash out the investment, to be paid in Q3 2023, or make a
move to a new vehicle in the portfolio. PERAC has advised Meketa that a simple rollover into another
existing private debt portfolio is not permissible under Chapter 32. Meketa will explore options and
report back at the June 22, 2023 Board meeting to discuss possible RFP’s. The presentation wrapped up
at 9:05 am.
Melissa Moesman and Michael Hickey presented the Fidelity Contrafund review at 9:08 am. Melissa
gave a brief overview of the strategy. She explained their philosophy of diversified domestic equity fund
with large growth bias and the process of research. The goal is to seek firms with great business models
that could maintain durable multiyear earnings growth. The main emphasis is on firms with high returns
on capital, free cash flow, prudently managed balance sheets, and little economic sensitivity. She then
turned the presentation over to Michael Hickey. He mentioned, as most clients, that 2022 was not the
best year in the markets. However, 2023 has seen many nice returns as the economy works its way back
to normalcy. Fidelity sector weights do not change too much. He admitted they are overweight in Tech
and Financial markets, but it remains to do well. META Platforms Inc. is their largest weighted sector,
holding the max of 10% in shares. It is the largest the Contrafund has ever held. Berkshire Hathaway,
Microsoft, and Amazaon are also top heavy. All three (3) are robust at the time of this meeting. He
concluded the portfolio is doing well in 2023 and sees no changes in the near future. The S&P 500 Index
is up 18.60% over a three (3) year period. The presentation concluded at 9:35 am.
Robert Cunha made a motion to adjourn the meeting at 9:40 am, which was seconded by Joseph Foley,
and unanimously approved by Carolyn Kosnoff, Fred Weiss, and Alan Fields.
The next Retirement Board meeting will be held on Thursday, June 22, 2023 at 8:30 am on Zoom.
Angelo Gordon will be present for review at 9:00 am.
_____________________________
Robert Cunha, Chairman Alan Fields, Appointed Member
Carolyn Kosnoff, Ex Officio Member Joseph Foley, Elected Member
Frederick Weiss, Appointed Member