Chicago City Wire

Laborers' & Retirement Board Employees' Annuity Benefit Fund of Chicago met June 20.

Here is the minutes as provided by the board:

Report of Meeting No. 986 held on June 20, 2017, starting at 1:02 p.m. at the office of the Laborers’ and Retirement Board

Employees’ Annuity and Benefit Fund of Chicago (“Fund” or “LABF”). The following notes attendance:

Board Members: Victor Roa – President (Union Appointed Member)

Erin Keane – Vice President (City Comptroller, City of Chicago) entered at 1:13 pm.

Michael LoVerde – Secretary (Active Employee Elected Member)

Carol Hamburger – Trustee (Managing Deputy Comptroller, City of Chicago)

James Capasso, Jr. – Trustee (Annuitant Elected Member)

James Joiner – Trustee (Active Employee Elected Member)

Staff & Consultants: Graham Grady – Taft Stettinius & Hollister LLP, Fund’s Counsel

Cary Donham – Taft Stettinius & Hollister LLP, Fund’s Counsel

Dr. Terence Sullivan – Fund’s Physician

James Wesner – Marquette Associates, Investment Consultant

Kweku Obed – Marquette Associates, Investment Consultant

Neil Capps – Marquette Associates, Client Analyst

Michael Walsh – Executive Director and Chief Investment Officer

Peggy Grabowski – Comptroller

John Carroll – Compliance Administrator

Sheila Jones – Administrative Coordinator

Nadia Oumata – Manager of Accounting and Investments

Tina Rhoten – Benefits Manager

Paul Rzeszutko – Assistant Benefits Manager

Nicole Evangelista – Payment Services Coordinator

Irene Velazquez – Payment Services Assistant

Absents: Kurt Summers, Jr. – Trustee (City Treasurer, City of Chicago)

Carole Brown – Trustee (Chief Financial Officer, City of Chicago)

Observers: Ayo Ayodele – City Treasurer’s Office (City of Chicago)

President Roa determined that a quorum was present after Trustee LoVerde took attendance.

Public Participation

None.

Approval of Minutes from Previous Meetings

It was moved by Trustee LoVerde, seconded by Trustee Joiner, that the regular minutes of Meeting No. 985 held on May 23, 2017 be approved as submitted.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

It was moved by Trustee LoVerde, seconded by Trustee Capasso, that the minutes of executive session 1 of Meeting No. 985 held on May 23, 2017 be approved as submitted.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule A – Applications for Refunds

1. Refund of Contributions Due to Separation from Service

It was moved by Trustee LoVerde, seconded by Trustee Joiner, that the Refunds of Contributions Due to Separation from Service be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule B – Applications for Annuities

1. Employee Annuities

It was moved by Trustee LoVerde, seconded by Trustee Capasso, that applications presented for Employee Annuities be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

2. Spouse and Child Annuities

It was moved by Trustee LoVerde, seconded by Trustee Joiner, that applications presented for Spouse and Child Annuities be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule C – Adjustment Refunds to New Annuitants

Mr. Donham and Mr. Carroll reviewed some of the specifics related to the refund for Mr. Wilton Sumerlin. It was moved by Trustee LoVerde, seconded by Trustee Joiner, that Adjustment Refunds to New Annuitants be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule D – Applications for Duty Disability Benefits

It was moved by Trustee Joiner, seconded by Trustee LoVerde, that the applications for Duty Disability Benefits be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule E – Applications for Ordinary Disability Benefits

It was moved by Trustee LoVerde, seconded by Trustee Capasso,that the applications for Ordinary Disability Benefits be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule F – Extension of Duty Disability Benefits

It was moved by Trustee Joiner, seconded by Trustee LoVerde, that the applications for Extension of Duty Disability Benefits, be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule G – Extension of Ordinary Disability Benefits

It was moved by Trustee Capasso, seconded by Trustee LoVerde, that the applications for Extension of Ordinary Disability Benefits be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule H – Payment of Uncashed Checks of Deceased Members

It was moved by Trustee LoVerde, seconded by Trustee Joiner, that the applications for Payment of Uncashed Checks of Deceased Members be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Schedule I – Payment of Expenses

It was moved by Trustee LoVerde, seconded by Trustee Joiner, that Administrative and Investment Invoices be approved and ordered paid.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Investments Report

Monthly Performance Report

Mr. Wesner reviewed the May 31, 2017 Performance Report.

Marquette Associates Transition Update

Mr. Obed updated the Trustees on the research capabilities of Marquette Associates and how the research team can assist in strengthening the LABF portfolio. Mr. Obed also noted that the current fee structure of the Fund was competitive compared to the industry average, but noted some improvement in fees was possible.

Index Manager RFP

Mr. Wesner suggested the Trustees authorize a search for an index manager capable of providing a variety of index services on both a short and long-term basis, depending on the evolving needs of the LABF.

It was moved by Trustee Hamburger, seconded by Trustee LoVerde, to approve an RFP for Equity and Fixed Income Index Strategy Investment Advisory Services as discussed in the meeting.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Administrative Report

Cash Needs

Mr. Walsh reviewed the year-to-date cash needs of the Fund as well as the upcoming estimated cash needs.

2017 Annuitant Member Election

Mr. Walsh discussed the 2017 Trustee Election for the Annuitant Member on the Board. After a review of some of the considerations related to the Annuitant Member Election, the Board gave the staff guidance as to the form of election to be held in October, 2017. Mr. Walsh stated that the LABF staff would prepare and present a draft of the Annuitant Member Election Rules at the July Board meeting.

Legislative Matters

Mr. Walsh reviewed a memo from the Fund’s Legislative Liaison regarding potential legislation and other activity in Springfield. See attached memo.

Treatment of Independent Contractors

Mr. Walsh discussed the hiring of LABF annuitants as independent contractors for entities defined as employers under Article 11 of the Illinois Pension Code. Mr. Walsh also reviewed several sections of the Illinois Pension Code pertaining to such contractual arrangements and the Trustees agreed that this practice is permissible under certain circumstances. Mr. Walsh and the Trustees agreed that the LABF should continue to follow what is outlined in the Statutes regarding these types of arrangements.

The Trustees also briefly discussed the definition of “Employer” in Article 11 of the Illinois Pension Code. The Trustees asked Fund Counsel to review the definition of “Employer” and provide guidance regarding what entities fall under that definition.

Funding Resolution

This item was taken out of order. Mr. Walsh presented a draft of the 2018 Funding Resolution for the Trustees to review. The draft included a request for employee and employer contributions from the City of Chicago associated with employees on duty disability during the previous year. The Trustees asked Mr. Walsh to explain the changes in the Resolution to the City Budget Director prior to sending the Resolution.

This vote was taken out of order. It was moved by Trustee Capasso, seconded by Trustee LoVerde, to approve the 2018 Funding Resolution as discussed in the meeting.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Executive Session No. 1

At 2:49 p.m., Trustee LoVerde requested an executive session under 5 ILCS 120/2(c)(11) to discuss current or potential litigation of the Fund. Trustee Capasso seconded the motion.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

At 2:54 p.m., Trustee LoVerde made a motion, seconded by Trustee Keane, that the executive session be adjourned and that the Board return to open session.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

The Trustees took no action.

Executive Session No. 2

At 2:54 p.m., Trustee Hamburger requested an executive session under 5 ILCS 120/2(c)(1) to discuss personnel or legal counsel matters. Trustee LoVerde seconded the motion.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

At 3:03 p.m., Trustee LoVerde made a motion, seconded by Trustee Capasso, that the executive session be adjourned and that the Board return to open session.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

It was moved by Trustee Hamburger, seconded by Trustee LoVerde, to approve the budget modifications discussed in executive session.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Administrative Report Continued

Miscellaneous

Mr. Walsh informed the Trustees regarding Marquette Associates’ upcoming client conference.

Legal Report

The legal topics were conducted in executive session.

Executive Session No. 3

At 3:09 p.m., Trustee LoVerde requested an executive session under 5 ILCS 120/2(c)(11) to discuss current or potential litigation of the Fund. Trustee Joiner seconded the motion.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

At 3:39 p.m., Trustee LoVerde made a motion, seconded by Trustee Capasso, that the executive session be adjourned and that the Board return to open session.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

Adjournment

With no further business, at 3:39 p.m., Trustee Capasso made a motion to adjourn the meeting. Trustee Joiner seconded the motion.

Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.

Against -- None.

http://www.labfchicago.org/assets/1/33/June_20_2017_LABF_Reg_minutes_Draft_Final_With_Attachment.pdf