MINUTES OF THE BOARD OF TRUSTEES
May 6, 2010
CALL TO ORDER
President David Marino called the meeting of the Board of Trustees of the Los Angeles Firemen’s Relief Association to order at 10:13 a.m.
- David Marino, President
- John Jacobsen, President
- Andrew Kuljis, Secretary
- Trustee Juan Albarran, Battalion 3
- Trustee Tim Larson – Battalion 6
- Trustee Robert Steinbacher – Battalion 7
- Trustee David Peters – Battalion 10
- Trustee Gary Matsubara – Battalion 11
- Trustee Craig White – Battalion 12
- Trustee Steven Domanski – Battalion 15
- Trustee Francisco Hernandez – Battalion 17
- Trustee Chris Hart – Battalion 18
- Trustee Kurt Stabel – Headquarters 2
- Trustee David Lowe – Pension 1
- Trustee Ralph Brownell – Pension 3
- David Ned Smith – Executive Director
- Controller – Todd Layfer
- Trustee Jeff Cawdrey – Battalion 1 (Excused)
- Trustee Gene Bednarchik – Battalion 2 (Excused)
- Trustee James Coburn – Battalion 4 (Excused)
- Trustee Mark Akahoshi, Battalion 5 (Excused)
- Trustee Doak Smith – Battalion 9 (Excused)
- Trustee Chris Stine – Battalion 13 (Excused)
- Trustee Michael Overholser – Battalion 14 (Excused)
- Trustee David Ortiz – Headquarters 1 (Excused)
- Trustee Barry Hedberg – Pension 2 (Excused)
- Garth Flint, Beacon Pointe Advisors
- Tonetta Connor, The Harrington Group
INVOCATION & Flag Salute
Andy Kuljis led the invocation.
RATIFICATIONS OF MINUTES
David Marino entertained a motion to ratify and dispense with the reading of the minutes of the Board of Trustees meeting held April 8, 2010. Gary Matsubara so moved. Craig White seconded the motion. There was no further discussion or objections.
Motion carried to ratify and dispense with the reading of the minutes of the Board of Trustees meeting held April 8, 2010.
1) David Marino mentioned the Policy committee meeting and thanked those that participated. He indicated that they will meet again to finish the project on May 20th, after the regular committee meetings.
2) David Marino informed the Board that they had purchased a section of pavers at the Historical Society and indicated that they have provided the first four names, Robert Henderson, William Goss, Warren Braun and William Dunn. He stated that Andy Kuljis had provided the dates that they served as Trustee and or President for the individuals.
EXECUTIVE DIRECTOR’S REPORT
David Smith informed that Todd Layfer would present the first quarter financials and expenditures for 2010. Todd Layfer reviewed each fund’s projected expenses as well as the G & A compared to the budget and reviewed funds generated from special events. The Association expenditures for the first quarter are slightly under budget and the Association is in a strong financial position.
AUDIT COMMITTEE REPORT
Juan Albarran stated that the Audit Committee had met with Tonetta Connor, a partner of our outside auditor, the Harrington Group and reviewed the audit findings in detail. Tonetta is present to address the Board with a summary of the audit.
Tonetta Connor stated that they took a detailed look at the systems and controls of LAFRA as well as all the figures stated in the financial reports to ensure that they are supported with documentation. She stated that they are pleased to report that LAFRA as well as the WODFF received a clean unqualified opinion that the Harrington Group. They did not notice any irregularities and all information was supported by documentation. She mentioned that they critically reviewed internal controls, performed staff interviews and observed the Dalmatian Store inventory. She indicated that they have made a few recommendations that they feel can strengthen and improve existing controls. She stated that there was a significant adjustment from what showed on the books compared to the actual inventory from the store, and suggested that they observe physical inventory in real time. Todd Layfer mentioned that they have implemented a new procedure to track the store inventory through the MAS90 system. He also mentioned that they have a new Point of Sale (POS) system that will integrate with the MAS90 system which will eliminate some of the inventory issues. Tonetta indicated that overall, LAFRA and the WODFF were in a very strong position.
Juan Albarran stated the following motion.
The Audit Committee recommends and I so move to approve the audit report and recommendations from the Harrington Group. There was no discussion or objections.
Motion carried to approve the audit report and recommendations from the Harrington Group.
VICE PRESIDENT’S REPORT
1) John Jacobsen referred to the presentation from Ken Buzzell and the Floyd Brothers regarding the Long-term Disability option for the Relief Association. He asked if the Board wanted to consider the option.
David Lowe motioned to deny the request of the pass-through for the Long-term Disability option. Craig White seconded. There was no discussion or objections.
Motion carried to deny the request of the pass-through for the Long-term Disability option.
2) John Jacobsen informed the Board that a member was requesting a retirement badge from the Relief Association. He indicated that there was question as to whether the member was in fact a member in good standing and what that meant for the membership. He informed the Board of the situation and asked for their direction.
David Peters motioned to deny the member’s request to be presented with a retirement badge. Juan Albarran seconded. David Lowe questioned if the Board had the authority to deny such a request. The Board further discussed what is stated in the by-laws and agreed that they must be consistent with their actions. On the question, there was an objection. Ten voted in favor of the motion, three voted opposed.
Motion carried to deny the member’s request to be presented with a retirement badge.
INVESTMENT COMMITTEE REPORT
Garth Flint addressed the Board on the 2010 first quarter results for investments. He addressed the current state of the economy and issues with employment.
Kurt Stabel indicated that there are concerns about economies in the “developed world” (US, Continental Europe, UK) slowing and that the US dollar is expected to be weak going forward due to massive amounts of government debt. But, as economies in the “developed world” are expected to grow slowly going forward expectations are that “emerging market” economies will become the engine of worldwide growth. Garth mentioned that if the government does not get the oil spill situation under control in Louisiana it could impact a lot of businesses. Todd Layfer asked how the Louisiana situation affects commodities assets with the price of natural gas. Kurt Stabel stated that natural gas prices are strongly tied to industrial production. So as the economy slowed in the US, natural gas prices cratered. Further, massive “shale gas” deposits have been found in the continental US which has further pushed down prices and they continue to stay at low levels even with the current situation in Louisiana.
Garth reviewed the investment portfolio performance and stated that it has done well relative to the policy index. Garth referred to the manager performance and indicated that Knightsbridge has had a really good run verses the Russell 1000 Value. He mentioned that Cohen & Steers, under the one-year mark performed under the benchmark at the 85th percentile, however they have good five and seven year numbers. He indicated that Stralem for the one-year ranked in the 73rd percentile, but shows better in the longer term by outperforming the benchmark. He stated that J.W. Seligman has done well with the one year, although they were slightly off with the first quarter 2010 which is nothing to be concerned about. He referred to Artisan and indicated that they have performed well in most time periods. He stated that Columbia aka Brandes has good three year numbers and ranks in the middle at 53rd percentile. He indicated that they have been taking a closer look at their performance and may consider a replacement. He mentioned that PIMCO has outperformed the index by 8%+ and ranked in the first percentile for the last five to seven years. He stated that their goal is to outperform the benchmark by 60 basis points and the portfolio has far exceeded that in the five and seven years. He referred to Gresham and indicated that they had just started with them and were a little negative for the quarter.
Kurt Stabel addressed the PIMCO Distressed Debt fund and indicated that it was up about 50%. He indicated that the fund has done well. Further, after listening to the fund manager’s quarterly conference call he said they indicated the fund will be winding down sometime in mid 2011. He referred to the Building Fund and stated that they will work with Todd and LAFRA’s auditors to develop a report or cash flow analysis based on the funds gained from the sale of the 2900 Temple Street building in relation to the future purchase of real estate.
Kurt Stabel also mentioned that he and Frank Hernandez had attended the IFEBP Investment Institute in Phoenix, AZ.
RELIEF COMMITTEE REPORT
Juan Albarran presented the following motion.
The committee recommends and I so move to pay:
The Sick & Injury benefits in the amount of $36,349.35,
The Estate Planning benefit in the amount of $8,968.95,
The Relief Death Benefits in the amount of $67,500,
The Life & Accident Death Benefit in the amount of $12,000,
The Life & Accident Withdrawals in the amount of $9,714.
There was no discussion or objections.
Motion carried to pay the above Relief benefits.
Juan Albarran presented the following motions.
The committee recommends and I so move to accept the donations in the amount of $12,748.70 to the Widows, Orphans & Disabled Firemen’s Fund. There was no discussion or objections.
Motion carried to accept the donations in the amount of $12,748.70 to the Widows, Orphans & Disabled Firemen’s Fund.
Donations to WODFF for April 2010
- CURT KLAFTA IN MEMORY OF OUR “PAPA” NORBERT S. KLAFTA
- RICHARD LAMBINE
- O’HARA’S RESTAURANT & BAR, INC.
- BEVERLY HILLS HIGH SCHOOL- STUDENT STORE FROM YOUR “911 FUNDRAISER”
- JOSTENS INC.
- GARY B. KLASSE IN MEMORY OF COMMISSIONER JOHN LAWSON, BLANCHE KLASSE-LAWSON & LARRY KLASSE
- GARY D CRAMER IN MEMORY OUR FATHER CAMERON CRAMER
- TIMOTHY G LARSON FROM THE PROCEEDS OF MY RETIREMENT DINNER
- JUDITH E. IRONS IN MEMORY OF MY HUSBAND CAPTAIN CHRISTOPHER IRONS
- ROD BOGUE IN HONOR OF CHRIS IRONS
- FIRE STATION NO. 14 FROM YOUR FIRE EXTINGUISHER FUND
- CATHERINE L COOK IN MEMORY OF RICHARD LAMBINE
- MICHAEL GOULD IN MEMORY OF RICHARD LAMBINE
- DOAK SMITH FROM THE SALE OF THE CPR MANNEQUIN
- WHITNEY L PARKHILL IN MEMORY OF RICHARD LAMBINE
- LILY F. HOLVERSTOTT IN HONOR OF BATTALION CHIEF CAMERON P. CRAMER
- JOHN W POTTER IN MEMORY OF RICHARD M. LAMBINE
- ROBERT H. KRAMER IN MEMORY OF CAMERON CRAMER
- RON HOLVERSTOTT IN MEMORY OF CAMERON CRAMER
- ANTONY F. SPRING IN MEMORY OF RICHARD LAMBINE
- BARBARA J BROWN IN MEMORY OF CAMERON CRAMER & JEAN COSTELLO
- THOMAS A STEWART IN MEMORY OF RICHARD LAMBINE
- ANONYMOUS DONATION IN MEMORY OF CAMERON CRAMER
- GARY D CRAMER IN MEMORY OF LOIS CATE
- LADDIE L. COFFIN IN MEMORY OF GARY KLASSE’S MOTHER BLANCHE
- NEIL E BULLOCK IN MEMORY OF BOB HARVEY & ED TETER
- DENNIS L MENDENHALL IN MEMORY OF ED TETER
- BREMERTON FIRE FIGHTERS IN MEMORY OF JIM PERRY
- FRANK DOROFF IN MEMORY OF RICHARD LAMBINE
- NICOLE R VAN WINKLE FROM THE SALE OF THE CPR MANNEQUIN
- DANA LAINE IN MEMORY OF ED TETER
- JOHN WARE IN MEMORY OF JOSEPH & LEOTA EVERETT
- CRAIG A. HURST IN MEMORY OF BOB & NOREEN HENDERSON
- PAULA MEIER IN MEMORY OF BLANCHE KLASSE-LAWSON
- RICHARD & KAREN LESSER IN HONOUR OF A VERY SPECIAL WOMAN AND MOTHER TB KONJOYAN ON HER BIRTHDAY FEBRUARY 26TH
- BETTY V. LARSON
- GEORGE R FRY IN MEMORY OF CAPTAIN JIM PERRY
- MARIE D. SHAFER
- MARIE D SHAFER
- FIRE STATION NO. 15 FROM OUR FIRE EXTINGUISHER FUND
- STEVE HEISE IN MEMORY OF RICHARD M. LAMBINE
- BOB KEATHLEY IN MEMORY OF RICHARD LAMBINE
- NEIL COLGROVE IN MEMORY OF BLANCHE KLASSE LAWSON
- RUSSELL L. TUPPER IN MEMORY OF RICHARD M. LAMBINE
- JANNA LAMBINE YOUR COUSIN RICHARD LAMBINE
- WILLIAM W WADDEL IN MEMORY OF FRANCES ROBAR WIDOW OF ELMER ROBAR
- LOIS MCKINNEY IN MEMORY OF BLANCHE KLASSE LAWSON
- EDWARD P GALBO IN MEMORY OF CHRIS IRONS
- LARRY G THOMAS IN MEMORY ED TETER
- WILLIAM P BAER IN MEMORY OF RICHARD LAMBINE
- FUMIKO HUMBERD IN MEMORY OF BLANCHE KLASSE-LAWSON AND MY SISTER SUMI
- JOHN L. PECEL IN MEMORY OF ED TETER
- MARJORIE WILLIAMSON
- VINCE CARDINALE IN MEMORY OF ED TETER
- JAMES HAW IN MEMORY OF JOE EVERETT
- ANONYMOUS DONATION
- GARY C GAUSMAN
- FIRE STATION NO. 87 FROM OUR EXTINGUISHER FUND
- FRED D. CRAMER IN MEMORY OF OUR BROTHER CAMERON CRAMER
- ROGER F. MEYER IN MEMORY OF CHRIS IRONS
- CLAUDIO LOPEZ IN MEMORY OF BLANCHE LAWSON
- SEVERINO M TRAPLETTI IN MEMORY OF CAMERON CRAMER
- LOIS J WELLS IN MEMORY OF RICHARD M. LAMBINE
- MALEN W JACOBS IN MEMORY OF CAMERON CRAMER
- RON KEATHLEY IN MEMORY OF RICHARD LAMBINE
- SANDRA L BUCKENDORF IN MEMORY OF CAMERON CRAMER
- JOHNNY TURBIN IN MEMORY OF CHRISTOPHER M. IRONS
- JANET E BARROS IN MEMORY OF DICK LAMBINE
- JAMES A. CHATTERTON IN MEMORY OF A GREAT LADY BLANCHE KLASSE-LAWSON
- RONALD G. MCINTYRE IN MEMORY OF BLANCHE KLASSE-LAWSON
- WILLIAM W. RUSSELL IN MEMORY OF BLANCHE KLASSE-LAWSON
- RICHARD & DOUGLAS GARNER IN MEMORY OF OUR FATHER CAPTAIN GEORGE GARNER
- ROBERT KNIPSCHEER IN LOVING MEMORY OF DEANNE K. BENNETT DAUGHTER OF JACK & JOAN BENNETT
- SHARON WOODS IN MEMORY OF RICHARD LAMBINE
- JOHN F VIRGIL
- HUNTER M. TAMASHIRO
- SAMUEL J. FARUZZI
- LYLE E. HALL
- CRAIG YAMASHIRO
- WILLIAM M. WOODSON
- IRENE HASKIN
- TOM STIRES
- JACK A. TEUFEL
- JOSEPH A. EVERETT
The committee recommends and I so move to assist;
A retired member with $500 per month with a six month review,
A retired member with $958 per month with a six month review,
A surviving spouse with medical premiums with a six month review,
A surviving spouse with $1,600 per month with a six month review,
A surviving spouse with $500 per month with a six month review.
There was no further discussion or objections.
Motion carried to approve assistance as stated.
Juan Albarran presented the following motions.
The committee recommends and I so move to advance;
Three active members with a total of $21,215.32,
A retired member with $609.40 for out of pocket medical expenses,
A surviving spouse with a continued reversed mortgage in the amount of $2,000 with a six month review.
Motion carried to approve emergency advancements as stated.
Joseph V. Walsh
Donald S. Willer
Dofel J. Brunetti
Garry R. Rice
Robert D. Gallas
Wayne K. Burdick
Christopher M. Irons Jr.
Claude R. Morris
Cameron P. Cramer
Edward L. Teter
William J. Sutter
Robert J. Brady, Jr.
Allan R. Sies
Frank D. Lockett
Juan Albarran read the names of members who recently passed and asked for a moment of silence from the Board.
ADMINISTRATIVE COMMITTEE REPORT
Robert Steinbacher presented the following motions.
The committee recommends and I so move to pay the usual and customary bills in the amount of $985,839.43. He stated that $500K was for the Kaiser pass through. There was no discussion or objections.
Motion carried to pay the usual and customary bills in the amount of $985,839.43.
The committee recommends and I so move to pay the professional fees in the amount of $113,715.32. There was no discussion or objections.
Motion carried to pay the professional fees in the amount of $113,715.32.
The committee recommends and I so move to approve the Certificate of Corporate Resolution of LAFRA for the amendments on the employee 401K plan. The amendments were required to bring the plan in compliance with new regulations. David Marino stated it was an IRS requirement for proper notification to the Board of Trustees. There was no further discussion or objections.
Motion carried to approve the Certificate of Corporate Resolution of LAFRA for the amendments on the employee 401K plan.
MEDICAL COMMITTEE REPORT
David Peters presented the following motions.
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 the applications to the Medical Plan.
The committee recommends and I so move to pursue litigation with the Stanford Hospital as well as with HealthScope Benefits. He stated by doing this, we are performing our fiduciary responsibility on behalf of LAFRA.. He indicated that they have a scheduled phone conference to discuss the issue with HSB. There was no discussion or objections.
Motion carried to pursue litigation with the Stanford Hospital and HealthScope Benefits.
1) Chris Hart provided an action plan for the Dalmatian store and stated that they have been discussing how to change the business plan in order to drive the sales. Going forward the major emphasis will be on selling to the general public instead of the past practice of focusing on selling primarily to firefighters and their families. He indicated that the list includes items that they have already begun to implement. He mentioned that they need to determine the shipping of items and costs.
2) Chris Hart reported on the Grapevine and indicated that everything was going good. He indicated that they are trying to get the new issue on the web site.
1) Hope for Firefighters – June 3rd
2) Second Magic Mountain LAFD Night – August 27th
3) Colorado Springs Memorial – September 11th
4) LAFD Invitational Golf Tourn – September 13th
5) Member Appreciation @ Saddle Ranch – October 17th
6) Open House – November 6th
7) Annual IFEPB Conference (Hawaii) – November 14th – 17th
1) Mike Radomski – May 12th Renaissance Agoura Hills Hotel
2) Monte R. Buckner – May 15th African American Firefighter Museum
3) Gregory West – May 18th Porter Valley Country Club
4) Edward Gonzalez – May 19th Knollwood Country Club
5) Marc “Marcus” Young – May 22nd Fire Station 49
6) Johnny Garcia – May 25th Los Angeles Police Academy
7) Arthur W. Shubik, Eddie Johnson & Juan Gonzalez – May 26th Luminarias
David Marino entertained a motion to adjourn. David Lowe so moved. Tim Larson seconded. There was no discussion and no objections.
Motion carried to adjourn.
The Board of Trustees meeting adjourned at 12:07pm.
David Marino, President