MINUTES OF THE BOARD OF TRUSTEES
May 1, 2013
CALL TO ORDER
President John Jacobsen called the meeting of the Board of Trustees of the Los Angeles Firemen’s Relief Association to order at 10:22 a.m.
ROLL CALL
MEMBERS PRESENT:
- Juan Albarran, Vice President
- Andrew Kuljis, Secretary
- Trustee James Coburn
- Trustee Francisco Hernandez
- Trustee Rick Godinez
- Trustee Gene Bednarchik
- Trustee Chris Hart
- Trustee Steven Domanski
- Trustee Jeff Cawdrey
- Trustee Craig White
- Trustee Steve Ruda
- Trustee Barry Hedberg – Pension
- Trustee Tim Larson – Pension
- Trustee David Lowe – Pension
- David Ned Smith – Executive Director
- Controller – Todd Layfer
MEMBERS ABSENT:
- Trustee Michael Overholser (Excused)
- Trustee Robert Steinbacher (Excused)
- Trustee Mark Akahoshi (Excused)
- Trustee Doak Smith (Excused)
- Trustee Steve Tufts (Excused)
- Trustee Chris Stine (Excused)
- Trustee David Peters (Excused)
- Trustee David Ortiz (Excused)
- John Jacobsen, President (Excused)
GUESTS:
- Robert Olsen, L.A. Retired Fire & Police
- Lee Kebler, L.A. Retried Fire & Police
INVOCATION & Flag Salute
Rick Godinez led the invocation. Steve Ruda led the flag salute.
RATIFICATION OF MINUTES
Juan Albarran entertained a motion to ratify and dispense with the reading of the minutes of the Board of Trustees meeting held April 3, 2013. Craig White so moved. David Lowe seconded. There was no further discussion or objections.
Motion carried to ratify and dispense with the reading of the minutes of the Board of Trustees held April 3, 2013.
VICE PRESIDENT REPORT
1) Juan Albarran informed that Jacobsen and Steinbacher were in New York visiting with the financial advisors.
2) Juan Albarran reported that Jim Dolan has handed him the results of the elections for the L.A. Firefighters Association; President David Frelinger, Vice President George James, Treasurer Jim Dolan, Secretary Ray Keene. He also mentioned that the CSFA directors will be Robbie Cordobes, Russell Rawls and Dennis Frazier.
3) Juan Albarran mentioned the resignation of Kurt Stabel and indicated that if anyone has any questions, to please direct them to Kurt. He mentioned that they are looking for candidates to fill that position.
4) Juan Albarran mentioned the LAFRA Reunion and indicated that they have a few events planned. He indicated that they have filled 30 of the 35 RV spots. He also indicated that there are members who live in the area that will also participate. He mentioned that they will have members of other agencies present to help with any member questions.
AUDIT COMMITTEE REPORT
Todd Layfer informed that Tonetta Connor, Managing Partner of Harrington Group, will provide an update to their audit report.
Tonetta indicated that she had met with the Audit Committee last month to go over their findings from the audit. She stated that the Relief Association received an unqualified opinion which means that they looked at the systems, procedures, documents and underlying controls and if they are supported. She indicated that they found everything to be adequately supported. She reported that last year, the Association net assets increase $14.2 million with income exceeding expenses including net gain on the investment portfolio of about $9 million. She stated that they found no issues with the internal controls. She commented that the Association has very strong financials.
Juan Albarran entertained a motion to accept the audit report presented by the Harrington Group. Craig White so moved. Barry Hedberg seconded. There was no discussion or objections.
Motion carried to accept the audit report provided by the Harrington Group.
INVESTMENT REPORT
Garth Flint presented the investment performance for the LAFRA portfolio ending March 31, 2013. He reviewed the market performance compared to the current environment and future expectations. He referred to the returns as of March 31st and indicated that one-year figure indicates that the portfolio had underperformed the policy index. He stated that the policy index is 75% of the S & P 500 and 25% of the Aggregate Bond Index and indicated that they are looking at changing the policy index for their clients because it is not reflective of how they are invested currently. He did mention that the policy outperformed the Allocation Index for the one-year, but also mentioned that the composite of all investments outperformed both indexes in the 5, 7 and 10 year periods.
He referred to Domestic Equities, and indicated that they are defensive with St. James, Symons and Stralem in order to preserve capital in down markets. He indicated that St. James had a difficult year relative to the index and ranked in the 95th percentile. He stated that St. James did very well on their 5, 7 and 10 year returns which was before LAFRA contracted with them. He mentioned that Cohen & Steers has been on the watch list and stated that they are a little more aggressive. He stated that they are concerned because they are not outperforming on their 5 and 7 year returns and may consider replacing them. He referred to Stralem and stated that they are very defensive. He indicated that they are looking at becoming more aggressive and finding a manager to pair up with Stralem that is a Large Cap Growth manager that invests in classic world stocks. He referred to the London Company and stated that their composite has done very well and outperformed the benchmark in both the short and long range.
He referred to PIMCO Total Return bond fund and stated that they have really outperformed the benchmark. He stated that they have had great performance out of the BRAVO Fund and indicated that they are up 25% for the year. He stated that they had just added Southwest Value Partners and indicated that they do not yet have numbers for them. He also stated that he will meet with the Investment Committee to discuss changing asset allocations. Juan Albarran asked why there was a negative on the YTD Net Contributions. Todd Layfer stated that he will look into that and indicated that it should not be a negative.
EXECUTIVE DIRECTOR’S REPORT
1) David Smith provided an update for the Hope for Firefighters event and mentioned that Ralphs has stepped up to be the official soft drink and water provider. He stated that they have 9 food booth sponsors so far and 9 muster teams signed up for the event. He indicated that the L.A. County Health inspectors are pushing to place screens on the booths because of their regulations. He also mentioned that from 11:00am – 12:00pm there will be a homeland security training session in downtown L.A. three blocks away but it should not affect the HFF event.
2) David Smith referred to the Purchase and Sales Agreement for the building and indicated that they are in agreement with the language except for one issue. He stated that it has to do with the lease-back option. He stated that they have countered to have the seller pay the month-to-month carry over lease with the Credit Union if we had to stay beyond our lease.
3) David Smith mentioned that Jacobsen had approved the final home page for the new LAFRA.org site and indicated that it should be up and running in six weeks.
4) Todd Layfer mentioned that he attended an eight day Nonprofit Management class that dealt with several topics such as board development and governance, financial management, fundraising and social enterprise. He stated that his take on this class was that the things LAFRA deals with on a daily basis are being practiced appropriately.
MEDICAL COMMITTEE REPORT
Barry Hedberg presented the following motion.
The committee recommends and I so move to accept the applications to the Medical Plan. There was no discussion and no objections.
Motion carried to accept all applications to the Medical Plan.
He mentioned open enrollment and indicated that we have added 27 new members with 61 dependents. He stated that they are waiting on UFLAC to provide the number of those who dropped off the plan.
ADMINISTRATIVE COMMITTEE REPORT
Chris Hart presented the following motions.
The committee recommends and I so move to pay the usual and customary bills in the amount of $781,532.67. There was no discussion or objections.
Motion carried to pay the usual and customary bills in the amount of $781,532.67.
The committee recommends and I so move to pay the professional fees in the amount of $119,708.16. There was no discussion or objections.
Motion carried to pay the professional fees in the amount of $119,708.16.
Chris Hart mentioned that the Six Flags Magic Mountain Firefighter night will happen again this year on August 23rd. He stated that LAFRA is no longer required to have a minimum guarantee of ticket sales. He indicated that LAFRA will only provide advertisement on the website and Grapevine. Tickets will only be sold through the Magic Mountain web site.
The committee recommends and I so move to approve an additional $4,500 beyond the contracted amount with CodeSpoke to finalize the website. There was no discussion or objections.
Motion carried to approve an additional $4,500 beyond the contracted amount with CodeSpoke to finalize the website.
The committee recommends and I so move to purchase 100 additional flag boxes from the vendor previously used. There was no discussion or objections.
Motion carried to purchase 100 additional flag boxes from the vendor previously used.
RELIEF COMMITTEE REPORT
James Coburn presented the following motion.
The committee recommends and I so move to pay:
The Sick & Injury benefits in the amount of $7,614.80
The Estate Planning benefit in the amount of $5,457.95,
The Relief Death Benefits in the amount of $18,000.
There was no discussion or objections.
Motion carried to pay the above Relief benefits.
James Coburn read the names of members who recently passed and asked for a moment of silence from the Board.
MEMORIALS
Robert E. Lowe
Ronald P. Marano
Jerry R. Brady
Frank C. Geyer
ASSISTANCE COMMITTEE
James Coburn presented the following motions.
The committee recommends and I so move to accept the donations in the amount of $3,198.77 to the Widows, Orphans & Disabled Firemen’s Fund. There was no discussion or objections.
Motion carried to accept the donations in the amount of $3,198.77 to the Widows, Orphans & Disabled Firemen’s Fund.
The committee recommends and I so move to approve the financial assistance applications for surviving spouses, active and retired members. There was no discussion or objections.
Motion carried to approve the financial assistance applications for surviving spouses, active and retired members.
EMERGENCY ADVANCEMENTS
James Coburn presented the following motion.
The committee recommends and I so move to approve the emergency advancement applications for active and retired members. There was no discussion or objections.
Motion carried to approve the emergency advancement applications for active and retired members.
SCHOLARSHIP COMMITTEE REPORT
Rick Godinez mentioned that they will have their Scholarship exams this coming weekend. He indicated that they have added the Leadership category for this year’s program. He stated that they have 36 candidates and mentioned that two of them were memorial scholarships. He also stated that they want the ability for the candidates to complete the applications online next year. Juan Albarran indicated that he thought that there were going to be three candidates for the memorial scholarship. Rick indicated that he has not yet heard of the third person. After the meeting it was confirmed there were three memorial scholarship candidates.
The committee recommends and I so move to award two memorial scholarships and making an exception to one candidate that may not be able to participate on exam day due to taking a placement test. There was no discussion or objections.
Motion carried to award two memorial scholarships and make an exception to one that may not be able to participate on exam day.
GRAPEVINE/WESBITE REPORT
Chris Hart asked the Trustees to spread the word in their battalions to submit stories to be published in the Battalion News section of the Grapevine. He also indicated that they are currently focusing on social media and mentioned that they have about 1,800 members through Facebook and several more through other social media sites. He also indicated that they will soon be looking into upgrading new hardware and software for the Grapevine staff so that they could work at industry standard.
SECRETARY’S REPORT
Andy Kuljis indicated that they had asked permission from the Fire Department to film a flag raising ceremony at Fire Station 84. He indicated that if they approve, they will provide DVD’s for worksites and will place on the website.
BY-LAW COMMITTEE REPORT
David Lowe indicated that he will have some by-law changes to present at the next Board meeting.
SETTING OF DATES
1) LAFRA Reunion – May 29th through June 2nd
2) L.A. Retired Fire & Police Annual BBQ June 5th
3) Hope for Firefighters – June 6th
RETIREMENT DINNERS
1) Kenny Myers & Ernie Navarro – May 11th Newport Beach Vineyards
2) Richard Martinez – May 31st The Castaway Restaurant
3) James Stiglich – June 12th The Odyssey
4) James F. Cairns – June 15th Mountain Gate Country Club
5) William E. Thost Jr. – June 28th Quiet Cannon
6) Bobby Mihlhauser – July 19th Marriott Warner Center
ADJOURNMENT
Juan Albarran entertained a motion to adjourn. Craig White so moved. Tim Larson seconded. There was no discussion and no objections.
Motion carried to adjourn.
The Board of Trustees meeting adjourned at 12:00 pm.
Juan Albarran, Vice President