HomeMy WebLinkAbout2019-02-28-RB-min Minutes of the February 28, 2019 Retirement Board meeting:
Present: Bob Cunha, Joe Foley, Fred Weiss, Carolyn Kosnoff, Marguerite Oliva&Jim Condon
Absent: Alan Fields
NEW MEMBERS: (10) Katherine Sampson, Milton Link, Peter Hines, Melissa Hanson-Gutierrez, Quynn
Kiers, Amy Flanagan; Instructional Assts.; Janice Curran, Secretary; Timothy Stahl, Maximilian Keefe,
James Melo, Firefighters;
RETIREMENTS: Thomas Kasey, Mechanic, 4/18/19
DEATHS: (2) Laura Ferraguto, School Dept. Cook, 12/11/18,Priscilla Troy, Aide, 2/14/19
The Board accepted the 022819 Warrant and the February 2019 payroll. The January 2019 minutes were
reviewed and approved, as well as the cashbooks for December 2018.
Bob Cunha reviewed the February agenda with the Board members and staff. It was noted we received
distributions from Monroe and Golub, as well as the 3rd Quarter FY 2019 appropriation from the town.
The Board members took time to rank Dahab, Fiduciary Investment Advisors, and Vanguard as part of
PERAC's compliance process for their Investment Consultant procurement. The ranking sheet required a
scoring system from one (1) to four(4). Four being highly advantageous, three as advantageous, two as
not advantageous, and one as unacceptable. The Meketa ranking sheet had already been completed prior
to meeting. Bob noted that Meketa's pricing was very fair compared to the other consultants. Meketa,
located in Westwood, also services other Retirement Board clients in MA. The Board is extremely
comfortable with the communication and services it receives from this consulting group. A level of
confidence and trust in Meketa has been at the forefront of this business partnership since inception.
Bob Cunha made a motion to retain Meketa Investment Group as our Investment Consultant for the next
seven(7)years,which was seconded by Joe Foley, and approved by Fred Weiss.
A second motion was made by Bob to approve the Cost of Living Adjustment for retirees. The motion
for a 3%increase on the first$14,000.00 was seconded by Joe, and unanimously approve by Fred and
Carolyn.
Each Board member was advised of their duty to fulfill Board Training credits within the next 12 months.
Course credits can be viewed on the PERAC website by going into PROSPER.
Henry Juang and Steve McLennan presented the Meketa update. The portfolio balance as of January 31,
2019 was $166,433,470.00,up 5.9% for the year. The balance is up $8.5m from the December 31, 2018
year end close. Several factors include our asset allocation. Acadian and Matthews Pacific Tiger
allocation performed well in January in International equity. Russell, Fidelity and KAR did well on the
Domestic equity side.
Henry spoke of the portfolio's weak finish in 2018. Despite being down 8.4% for the final quarter of
2018, all the proper selections were in place. It was just a rough market to weather the storm globally.
Heading into March 2019, the portfolio is up 6% YTD. It appears the Federal Reserve will be backing off
any interest rate hikes or cuts. And with no real inflation, there would be no need to adjust the rate. He
then spoke briefly about our expected returns for 2019. The mark has been set at 8%. It is a bit high, but
until the final numbers are in for 2018, it could lower to 7.2%—7.5%.
Meketa has received fourteen(14) RFP's for the emerging market search. They will research and
evaluate each one within the next month. At the March Board meeting, Meketa will present a ranking list
of the top prospective firms for our Board members to review.
Chuck Johnson and Julie Snaman presented the Acadian update. Chuck mentioned the organization now
manages over 86.213 in assets as of December 2018 with the help of 387 employees worldwide. Heading
into this year, Acadian will be scaling back on technology sectors and leaning towards banks, healthcare,
and equipment services as part of their plan. The market shares in China are up 10.1% this year and
Acadian has 2.5% exposure in the market. They remain optimistic,yet cautious, because of past
volatility. Chuck feels materials are the main exposure for China and Asia. There seems to be plenty of
growth in that particular market. Overall, Acadian has been doing what the Board has expected of them.
The Three year annualized return was 6.0%,while the Five year was 5.1%.
Ed Schollmeyer and Mike Hickey presented the Fidelity update. Like most investors, the first 3 QTR'S of
2018 were very strong. Fidelity was up 7% thru Sept. 2018. The 4"'QTR could not hold onto the
positive numbers in the portfolio. However, the first eight(8)weeks of 2019 have been very strong. The
Federal Reserve has backed off from any talk of rate changes. A trade deal with China could be coming
this year. Overall, the market is on the right track and generating opportunities for growth. Healthcare is
a major player in the market, consuming 17% of the total US economy. Fidelity will continue to shy
away from small cap holdings in 2019. They want limited exposure to materials and real estate. Mike
mentioned financial sectors have been the biggest disappointment. It is very overweight and they are now
trimming down these past few quarters. In closing, Mike stated the portfolio is up around 12% YTD,
with the possibility of returns in the 12%- 18% zone in 2019.
Fossil Fuel exposure is approximately 4.6% as of December 31, 2018. Within this exposure, around 1.5%
of the total is invested in the Carbon Underground 200 Companies.
Bob Cunha motioned to adjourn the meeting at 10:00 am, which was seconded by Joe, and unanimously
approved.
The next Retirement Board meeting will be held on March 28, 2019 at 8:00 am in Cary Memorial
Library.
Wellington Enduring and Opportunistic Funds will both be invited to attend.
ABSENT
Robert Cunha, Chairman Alan Fields, Appointed Member
Carolyn Kosnoff, Ex Officio Member Joseph Foley, Elected Member
Frederick Weiss, Appointed Member