Laborers' & Retirement Board Employees' Annuity Benefit Fund of Chicago Board of Trustees met July 18.
Here is the minutes provided by the Board:
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. 986 held on June 20, 2017 be approved as submitted.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.
Against -- None.
Abstain -- Trustees Summers and Brown.
It was moved by Trustee LoVerde, seconded by Trustee Capasso, that the minutes of executive sessions 1, 2 and 3 of Meeting No. 986 held on June 20, 2017 be approved as submitted.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Hamburger, Capasso and Joiner.
Against -- None.
Abstain -- Trustees Summers and Brown.
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, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
2. Miscellaneous Refunds
It was moved by Trustee Joiner, seconded by Trustee Hamburger, that applications presented for Miscellaneous Refunds be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule B – Applications For Annuities:
1. Employee Annuities
It was moved by Trustee LoVerde, seconded by Trustee Joiner, that the applications for Employee Annuities be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
2. Spouse and Child Annuities
It was moved by Trustee LoVerde, seconded by Trustee Capasso, that the applications for Spouse and Child Annuities be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule C – Adjustment Refunds To New Annuitants:
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, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule D – Applications For Duty Disability Benefits:
It was moved by Trustee LoVerde, seconded by Trustee Capasso, that the applications for Duty Disability Benefits be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule E – Applications For Ordinary Disability Benefits:
It was moved by Trustee LoVerde, seconded by Trustee Joiner, that the applications for Ordinary Disability Benefits be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule F – Extension Of Duty Disability Benefits:
It was moved by Trustee LoVerde, seconded by Trustee Capasso, that the applications for Extension of Duty Disability Benefits, be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule G – Extension Of Ordinary Disability Benefits:
It was moved by Trustee Joiner, seconded by Trustee Hamburger, that the applications for Extension of Ordinary Disability Benefits be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule H – Payment Of Uncashed Checks Of Deceased Members:
It was moved by Trustee LoVerde, seconded by Trustee Capasso, that the applications for Payment of Uncashed Checks of Deceased Members be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Schedule I – Payment Of Expenses:
It was moved by Trustee Joiner, seconded by Trustee LoVerde, that Administrative and Investment Invoices be approved and ordered paid.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Legislative Liaison Report-
Mr. Molaro reviewed his memo to the Board and updated them on the end-of-session legislative matters from Springfield.
See attached document.
Investments Report:
June 30, 2017 Preliminary Performance Report-
Mr. Obed invited the Board and LABF staff to attend Marquette’s upcoming investment symposium scheduled for Friday, September 29, 2017 and then reviewed the June 30, 2017 Performance Report.
Marquette Associates Transition Update/Peer Group Analysis-
Mr. Obed reported the current status of the transition and also reviewed a Peer Group Analysis report.
Cash Needs-
Mr. Obed provided the recommendation for assets to be liquidated to cover the Fund’s August, 2017 expenditures.
Executive Session No. 1:
At 2:05 p.m., Trustee LoVerde requested an executive session under 5 ILCS 120/2(c)(7) to discuss the sale or purchase of securities, investments or investment contracts. Trustee Joiner seconded the motion.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
At 2:08 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, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
The Trustees took no action.
Administrative Report:
Updated 2018 Funding Resolution-
Mr. Walsh reported that he, at the request of the Board, contacted Alexandra Holt, the City of Chicago’s now former Budget Director, and Samantha Fields, the City’s now current Budget Director, to discuss the rationale behind the LABF’s funding resolution adopted at the June 20, 2017 Board meeting prior to transmitting the associated funding request to the City. Mr. Walsh reminded the Board that based on the conversations he had with Mses. Holt and Fields, and due to the introduction of the ordinance seeking to amend the Municipal Code of the City of Chicago to authorize the City to make additional employer contributions, he informed the Board via email following the June Board meeting that he would temporarily refrain from sending the funding request and suggested the Board further discuss the matter at its July 18, 2017 meeting. Additionally, on July 6, 2017, Public Act 100-0023 became law and altered the City of Chicago’s statutory funding requirement, which required that the LABF’s funding resolution be revised.
Mr. Walsh reviewed two separate revised drafts of the 2018 Funding Resolution. The Board discussed what should be included in the funding request. The Board then requested additional time to look into the matter further.
It was moved by Trustee Capasso, seconded by Trustee Joiner, to retract the motion to approve the 2018 Funding Resolution that was approved at the June 20, 2017 Board meeting.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
2017 Annuitant Member Election-
Mr. Walsh reviewed a tentative election timeline and a draft of the 2017 Annuitant Member Election Rules. The Trustees chose Trustees Roa, Hamburger and Joiner to serve as the members of the Election Committee for the upcoming election.
It was moved by Trustee LoVerde, seconded by Trustee Hamburger, to accept the 2017 Annuitant Member Election Rules as presented in the meeting. See attached document.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Definition of Employer-
Mr. Walsh and Mr. Donham discussed a memo prepared by Taft Stettinius & Hollister LLP (“Taft”) reviewing the definition of “Employer” under Article 11 of the Pension Code. Mr. Donham reviewed the entities that Taft believes are “Employers” under Article 11.
It was moved by Trustee LoVerde, seconded by Trustee Hamburger, to accept Fund Counsel’s recommendation of the definition of “Employer” as outlined in the memo reviewed in the meeting.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
Legislative Matters-
Mr. Walsh discussed the administrative challenges that the Fund faces as a result of Public Act 100-0023 becoming law, of which he highlighted the following:
• An irrevocable election regarding new benefits will need to be made by certain members, however, LABF will need to first address some inconsistencies in the law and more carefully determine the affected member population. The Trustees acknowledged that the communication of the changes in law to the affected members will require a high level of coordination between LABF and the City of Chicago. The Trustees gave staff direction to create some administrative rules for review at the next meeting related to how the Fund will implement the various changes required under the law.
• LABF may receive inquiries from members regarding the irrevocable election. The Trustees requested that staff take a cautious approach so as to not give investment advice or legal advice as part of any communications to or with members affected by the new law
• Employee contributions will need to be changed as part of the new legislation for certain affected members. Mr. Walsh mentioned that LABF would begin working with the City of Chicago to implement the required changes.
• The Fund will engage its outside software developer to begin making the necessary modification to the pension administration system in order to administer PA 100-0023.
• There are several problems with PA 100-0023 with respect to treatment of reciprocal fund service. The Trustees agreed that the staff should work with the Speaker’s Office on the trailer bill to address some of the ambiguities in the new law.
Mr. Walsh and the Trustees agreed that this item should be more fully addressed in the August 22, 2017 Board meeting.
Disability Service Rule-
This item was deferred to the August 22, 2017 Board meeting.
Fraud Matter-
Mr. Walsh reviewed the status of the previously discussed fraud matter and the Trustees gave Mr. Walsh the authority to move forward with criminal prosecution of the perpetrator(s) on the Fund’s behalf if the investigation leads in that direction.
Legal Report:
The first portion of the legal topics were conducted in executive session.
Executive Session No. 2:
At 3:17 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, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
At 3:32 p.m., Trustee LoVerde made a motion, seconded by Trustee Joiner, that the executive session be adjourned and that the Board return to open session.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
The Trustees took no action.
Executive Session No. 3:
At 3:32 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 Hamburger seconded the motion.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
At 3:38 p.m., Trustee LoVerde made a motion, seconded by Trustee Joiner, that the executive session be adjourned and that the Board return to open session.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
The Trustees took no action.
Legal Report (continued):
Coveliers Litigation
Mr. Donham reported the status of the Coveliers litigation case.
Adjournment:
With no further business, at 3:38 p.m., Trustee LoVerde made a motion to adjourn the meeting. Trustee Capasso seconded the motion.
Roll-call: For-- Trustees Roa, Keane, LoVerde, Summers, Hamburger Capasso, Brown and Joiner.
Against -- None.
http://www.labfchicago.org/assets/1/33/July_18_2017_LABF_Reg_minutes_Final_with_Attachments.pdf
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