MINUTES OF THE BOARD OF TRUSTEES
November 6, 2008
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 9:56 a.m.
ROLL CALL
MEMBERS PRESENT:
- David Marino, President
- Robert Steinbacher, Vice President
- Andrew Kuljis, Secretary-Treasurer
- Trustee James Coburn – Battalion 1
- Trustee Gene Bednarchik – Battalion 2
- Trustee Juan Albarran, Battalion 3
- Trustee Mark Akahoshi, Battalion 5
- Trustee Tim Larson – Battalion 6
- Trustee Gary Matsubara – Battalion 7
- Trustee Doak Smith – Battalion 9
- Trustee David Peters – Battalion 10
- Trustee Chris Stine – Battalion 11
- Trustee John Jacobsen – Battalion 13
- Trustee Michael Overholser – Battalion 14
- Trustee Glen Prine – Battalion 15
- Trustee Francisco Hernandez – Battalion 17
- Trustee Dennis Mendenhall – Battalion 18
- Trustee Kurt Stabel – Headquarters 2
- Trustee Warren Braun – Pension 1
- Trustee Tom Stires – Pension 2
- Trustee Robert Henderson – Pension 3
- Executive Director – David Ned Smith
- Controller – Todd Layfer
MEMBERS ABSENT:
- Trustee Chris Hart – Battalion 4 (Excused)
- Trustee David Ortiz – Headquarters 1 (Excused)
- Trustee William Dunn – Battalion 12 (Excused)
GUEST PRESENT:
- Steven Domanski, Battalion 15 Elect
INVOCATION
Trustee Warren Braun 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 October 9, 2008. Gene Bednarchik so moved. David Peters 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 October 9, 2008 and to include the Investment Memorandum.
ADMINISTRATIVE COMMITTEE REPORT
Chairman David Peters presented the following motions.
The committee recommends and I so move to approve the usual and customary bills in the amount of $192,771.91 plus $683,734.75. There was no discussion or objections.
Motion carried to approve the usual and customary bills in the amount of $192,771.91 plus $683,734.75.
The committee recommends and I so move to pay the professional fees in the amount of $10,094.20. There was no discussion or objections.
Motion carried to pay the professional fees in the amount of $10,094.20.
The committee recommends and I so move to pay the Year-end employee bonuses up to $12,000 excluding Executive Staff. There was no discussion or objections.
Motion carried to pay the Year-end employee bonuses up to $12,000 excluding Executive Staff.
The committee recommends and I so move to approve the hiring of a Web and Communication Administrator up to $40,000 annually. David Smith informed that this position would report to the Marketing Director and maintain the website and keeping the donor data base up to date. There was no further discussion or objections.
Motion carried to approve the hiring of a Web and Communication Administrator up to $40,000 annually.
The committee recommends and I so move to approve for staff to negotiate a contract with either Ciplex or Tridian regarding the development of the website for a cost up to $30,000. David Marino updated the Board on their RFP for a website designer and what capabilities would be included. There was no further discussion or objections.
Motion carried to approve for Staff to negotiate a contract with either Ciplex or Tridian regarding the development of the website for up to $30,000.
The committee recommends and I so move to approve the recommended Compensation and Performance Appraisal System. David Smith presented a PowerPoint presentation of the Performance Appraisal System to the Board. He indicated that they have been looking over the current compensation and performance review system and mentioned that it has been a problem when recruiting professional staff. He indicated that they want to also be able to retain current talent and motivate employees to perform at higher levels. He reviewed the proposed system with the Board and provided his recommendations. The overall performance system would assist with employees in improving performance, reaching goals and development. He indicated that part of the action plan was to develop new job descriptions, which they are 60% completed. He mentioned that all job descriptions will be done by the end of December. He also indicated that another part of the action plan was to utilize the Center For Non-Profit Management salary survey as an outside benchmark in establishing salary ranges for as many positions as possible.
The annual schedule is to evaluate performance of all Administrative and Professional employees in March and in April, the Executive Staff will receive a performance appraisal. Employees will be eligible to receive a salary increase in July based on their performance review and where they are in their salary range. In December, employees will be eligible for an annual bonus, based on attaining their goals being set in their performance evaluation. He indicated that the Compensation Performance Appraisal System was to help employees with setting goals, maintain consistency and fairness with employee evaluations. It was noted that since performance appraisal have not been done for the staff for some time that appraisals are being completed for all employees in November. The new appraisal cycle will start in the Spring of 2009.
The Board proposed questions pertaining to turn-over of employees and the impact on the budget.
On the question, there was an objection to the motion. Sixteen voted in favor of the motion, two voted opposed.
Motion carried to approve the recommended Compensation and Performance Appraisal System.
EXECUTIVE DIRECTOR REPORT
1) David Smith updated status of the Open House event and mentioned that Juliet has been successful at coming in significantly under the $20,000 established budget.
He mentioned the Holiday Party and asked Trustees to encourage members to make their hotel room reservations. He indicated that the rates were $118 per night which is an excellent rate for the Biltmore Hotel. He asked that if anyone had sources for silent auction items, to let him or Marlene know.
2) David Smith informed that Todd Layfer would report on expenditures through the third-quarter. Todd Layfer reported on the overall revenues for the Association and indicated that they were up 6%. He reported that Medical was up 8% and donations were up 15%.
He reviewed the benefits paid out and stated that they were 3% lower than last year. He mentioned major a change was DME costs were down from last year and Assistance was down about 30%. However, the balance on assistance loans was up about $300,000 compared to last year.
The operating expenses (salaries, payroll tax and benefits) are up by 22% from last year as a result of the hiring of Executive staff and Controller. Other operating expenses were up overall at 14% as a result of paying rent for the building. David Smith recapped that the proceeds of the sale of the building at 2900 Temple Street were in the Building Fund in the Investment accounts and not being used to offset rent of our new space.
Todd Layfer referred to the Grapevine loss and indicated that it is about the same as last year. He mentioned that they have applied savings from publishing costs yet that was offset by now having to pay rent costs.
The Dalmatians store has had an overall net loss of $152,000 for the first eight months of 2008. He indicated that they expect the loss picture to improve because of the busy time during the holiday season. He mentioned that the average monthly sales for 2008 were about $40,000 compared to $42,000 in 2007. He indicated that they are holding weekly store meetings to develop ways to improve results such as changing the Dalmatian truck scheduled times of visiting fire stations.
Todd referred to the LAFRA portfolio of investments and reported that the total market value is about $68 million dollars which is a $7 million decrease (10%) from June 2008. This loss is substantially better that overall stock market performance which is down nearly 30 percent.
He provided the financial summary report for the Board’s review.
VICE PRESIDENT’S REPORT
1) Robert Steinbacher reminded the Board that they must make flight arrangements for those attending the IFEBP conference in San Antonio, TX.
INVESTMENT COMMITTEE REPORT
Garth Flint was present to address the Board on stock market performance, the impact on our investments and what he see’s going forward.
He referred to the Dow Corrections and indicated that they have had the worst first year ever. He stated that in terms of Index by Decades, they were at the worst ever. He reviewed the rolling annualized total return since 1827 and indicated that historically when it shows an annualized return of 2.5% rolling 10 years at a time, you get a V-shaped recovery off the bottom of the market. He stated that the current market is there and indicated that the market should work its way back up in late 2009.
He reviewed the Executive Summary of our portfolio and indicated that we have done well relative to peer groups and indexes. He reported that the composite returns of our investments for the one-year were down -9.5% and ranked in the 14th percentile. He reviewed each manager’s performance and indicated that Cohen & Steers and Knightsbridge were ahead of their comparison index ranking at the 9th and 11th percentile. He stated that Stralem & Co. has done very well and are in the 2nd percentile. He stated that they have placed J & W Seligman on the watch list due to under performance. He reported that the PIMCO Total Return Bond fund has had a tough quarter and fell off relative to the index resulting in a ranking at the 63 percentile. He stated that the new Alternative fund has done well with a 3% positive return for the quarter.
Kurt Stabel re-emphasized that our investments have been outperforming their benchmarks. He mentioned that the Investment committee has agreed to move some of our cash into two emerging market funds. He stated that Beacon Pointe has recommended two managers in the emerging market arena; one is a value manager and the other a growth manager. He stated that the total investment would be $1 million with 50% going to those two managers. He indicated they would hold off on making a decision on J.W. Seligman because of their good performance.
The committee recommends and I so move to move $500,000 to Lazard Correction Emerging Market Fund and $500,000 to the T Rowe Price Emerging Market Fund. There was no further discussion or objections.
Motion carried to move $500,000 to Lazard Correction Emerging Market Fund and $500,000 to the T. Rowe Price Emerging Market fund.
MEDICAL COMMITTEE REPORT
Chairman Michael Overholser 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.
ACTIVE
MEMBER APPLICANTS COMING ON PLAN EFFECTIVE DATE
- Contreras, Michael Louis Contreras, Jacquelyn (Spouse) 11/1/08
- Cascio, Donald Nicholas Gonzalez, Lorraine (Dom. Partner) 10/20/08
- Darcy, Nicholas Michael Darcy, Liliana Elizabeth (Dtr.) 9/1/08
- Debs, Theodore Jay Debs, Sophia Lillian (Dtr.) 10/10/08
- Deierling, Matthew David Deierling, Sierra (Spouse) 10/1/08
- Di Valerio, Christopher Gomez, Karen (Spouse) 9/13/08
- Meza, Miguel A. Meza, Simona (Spouse) 1/1/09
- Najera, Ricardo Najera, Mark Daniel (Son) 10/6/08
- Noonan, Douglas Noonan, Coral N. (Dtr.) 9/28/08
- Prian, Sean D. Prian, Lauren M. (Spouse) 10/1/08
- Rodriguez, Omar B. Rodriguez, Owen (Son) 9/25/08
- Sanderson, Gregory A. Sanderson, Hillary F. (Spouse) 12/1/08
- Sanz-Agero, Christopher Sanz-Agero, Cisco Michael (Son) 9/26/08
- Steinbacher, Robert Encinas, Kelley (Step Dtr.) 11/1/08
- Encinas, Kevin (Step-Son) 11/1/08
- Taggart, Charles Taggart, Alison M. (Dtr.) 10/10/08
- Verwey, Eric M. Verwey, April E. (Spouse) 11/1/08
The committee recommends and I so move to pay the usual and customary bills in the amount of $814,752. There was no discussion or objections.
Motion carried to pay the usual and customary bills in the amount of $814,752.
The committee recommends and I so move to approve the VSP contract renewal. He stated that they have increase by $ .03 per member for three years starting January 1, 2009. The Administrative rate was going from $1.50 to $1.53 per member per month. There was no further discussion or objections.
Motion carried to approve the VSP contract renewal.
RELIEF COMMITTEE REPORT
Chairman James Coburn presented the following motions.
The committee recommends and I so move to pay the Sick and Injury benefits for active and retired members in the amount of $10,491.98. There was no discussion or objections.
Motion carried to pay the Sick and Injury benefits in the amount of $10,491.98.
The committee recommends and I so move to pay the Estate Planning benefits in the amount of $4,200. There was no discussion or objections.
Motion carried to pay the Estate Planning benefits in the amount of $4,200.
The committee recommends and I so move to pay the Relief Death benefits in the amount of $27,000. There was no discussion or objections.
Motion carried to pay the Relief Death benefits in the amount of $27,000.
The committee recommends and I so move to pay the Life & Accident Death benefits in the amount of $12,000. There was no discussion or objections.
Motion carried to pay the Life & Accident Death benefits in the amount of $12,000.
MEMORIALS
Fred B. Sevy
Richard McGuire
Earl D. Gibbs
John D. Hughes
James W. Francis
Earl S. Gerrard
ASSISTANCE COMMITTEE
Chairman James Coburn presented the following motions.
The committee recommends and I so move to accept the donations in the amount of $4,988.82 to the Widows, Orphans & Disabled Firemen’s Fund. There was no discussion or objections.
Motion carried to accept the donations in the amount of $4,988.82 to the Widows, Orphans & Disabled Firemen’s Fund.
Donations to Widows, Orphans & Disabled Firemen’s Fund
- MARY KOPPES IN MEMORY OF JAMES JUST
- JACK M DAVIS IN GRATITUDE FOR DURABLE MEDICAL EQUIPMENT WE PROVIDE
- WARREN B BRAUN IN MEMORY OF MY WIFE GWEN
- RBI PRODUCTIONS, INC PRESENTED BY CAPTAIN TINA HARO
- PEGGY A JUST IN MEMORY OF MY HUSBAND JIM JUST
- WELLPOINT ASSOC. GIVING CAMPAIGN
- SUSAN C. AVILA-BRADSHAW IN MEMORY OF JIM JUST
- CRAIG A HURST IN MEMORY OF NOREEN HENDERSON
- EARL H. HARRIS IN MEMORY OF JACK DARR
- PHILLIP F. FOERSTEL IN MEMORY OF YOUR MOTHER MARY FOERSTEL
- MARGARET K. JUST IN MEMORY OF MY HUSBAND JAMES A. JUST
- RICHARD L. WATERS IN MEMORY OF JOHN D. HUGHES
- DARREN PERRINE IN MEMORY OF JAMES A. JUST
- THOMAS L JOHNSON IN MEMORY OF JAMES JUST
- KAY RICH IN MEMORY OF JAMES W. FRANCIS
- ED G. SUGAR IN GRATITUDE TO THE FIREFIGHTERS WHO SAVED MY HOUSE AND NEIGHBORHOOD DURING THE RECENT FIRES
- WILLIAM F HAMMEL IN HONOR OF GWEN LOUISE BRAUN AND ROBERT KELLY
- DAVID S STAIRS IN APPRECIATION TO THE FIREFIGHTERS WHO SAVED OUR HOUSE DURING THE RECENT SESNON FIRE 10/2008
- WASHINGTON MUTUAL EMP. GIVING PROGRAM OF 2 ANONYMOUS DONATIONS DURING THE ANNUAL GIVING CAMPAIGN
- AGUSTIN GONZALEZ, JR IN MEMORY OF JAMES JUST
- VIRGINIA R JEFFERS IN MEMORY OF RICHARD MCGUIRE
- ANTHONY DICICCO IN MEMORY OF GWEN LOUISE BRAUN
- FREDERICK E. MARTIN IN MEMORY OF JOHN D. HUGHES
- LARRY G. THOMAS IN MEMORY OF ROBERT FIERS
- GREGORY B. STONE IN MEMORY OF DOLORES COLEMAN WIDOW OF DICK COLEMAN
- KIRK P. BINGHAM IN MEMORY OF JAMES JUST
- JULAINE SALEM IN MEMORY OF JAMES A. JUST
- SHARON CONGDON IN MEMORY OF JAMES A. JUST
- JOHN W POTTER IN MEMORY OF LEONARD PETERSON
- ALLAN E RICHARDSON IN MEMORY OF JAMES FRANCIS AND BETTY DOWNEN
- SUNGWAN SO IN MEMORY OF JAMES JUST
- EDWARD T CHILSON IN MEMORY OF JAMES W. TROTTER
- CAROLYN HASHIBA IN MEMORY OF JAMES A. JUST
- DAVID T MARINO
- GUADALUPE M CARRANDI IN MEMORY OF JAMES JUST
- FIRE STATION NO. 114 FROM OF YOUR FIRE EXTINGUISHER FUND
- DOLORES E NICKERSON IN MEMORY OF EARL GIBBS
- WARREN P. WHITELOCK IN MEMORY OF JIM JUST
- JUDITH JASPERSON IN MEMORY OF JAMES JUST
- DEBBIE LIN IN MEMORY OF JAMES JUST
- JENNIFER S. KURATA IN MEMORY OF JIM JUST
- VINCENT CORTAZZO
- VINCENT CORTAZZO
The committee recommends and I so move to assist a widow with $500 per month plus medical premiums with a six month review. There was no discussion or objections.
Motion carried to assist a widow with $500 per month plus medical premiums with a six month review.
The committee recommends and I so move to assist a retired member with $1,000 per month with a four month review. There was no discussion or objections.
Motion carried to assist a retired member with $1,000 per month with a four month review.
The committee recommends and I so move to assist a retired member with $1,100 per month with a six month review. There was no discussion or objections.
Motion carried to assist a retired member with $1,100 per month with a six month review.
The committee recommends and I so move to write-off $14,200 of a member’s advancement for spouse’s health care. There was no discussion or objections.
Motion carried to write-off $14,200 of a member’s advancement for spouse’s healthcare.
EMERGENCY ADVANCEMENTS
James Coburn presented the following motions.
The committee recommends and I so move to advance a member $9,298.76 for past medical premiums plus continue to advance future medical premiums with a six month review. David Marino mentioned that the member has turned in paperwork and has agreed to reimburse the Association for monies paid once their settlement has been paid. There was no further discussion or objections.
Motion carried to advance a member $9,298.76 for past medical premiums, plus continue to advance for future medical premiums with a six month review.
The committee recommends and I so move to advance a member $2,500 per month for four months. There was no discussion or objections.
Motion carried to advance a member $2,500 per month for four months.
The committee recommends and I so move to advance a member $9,335.63 for outstanding bills, plus $1,500 per month with a six month review. There was no discussion or objections.
Motion carried to advance a member $9,335.63 for outstanding bills plus $1,500 per month with a six month review.
The committee recommends and I so move to advance a member with $34,501.55 for past medical premiums, plus repayment of NIOD benefits. There was no discussion or objections.
Motion carried to advance a member with $34,501.55 for past medical premiums plus repayment of NIOD benefits.
The committee recommends and I so move to advance a member $5,000 one time. There was no discussion or objections.
Motion carried to advance a member $5,000 one time.
James Coburn informed that they have been receiving and reviewing several requests from members for very large sums of monies. He mentioned that some of the requests may be out of sorts and have been substantial. He indicated that the committee has agreed to place a cap on the requests based on a fully paid firefighter of 20 years, three months maximum pay. He stated that if the member needed more, they would be required to come in and present their case to the full Board and provide reason for the necessity of the additional money.
The committee recommends and I so move to implement new policy for Emergency Advancements and place a maximum cap on requests based on a fully-paid firefighter of 20 years, three months maximum pay. There was no further discussion or objections.
Motion carried to implement new policy for Emergency Advancements and place a maximum cap on requests based on a fully-paid firefighter of 20 years, three months maximum pay.
The committee recommends and I so move to provide Christmas bonuses for the Widows and Orphans as last year. There was no discussion or objections.
Motion carried to provide Christmas bonuses for the widows and orphans as last year.
SECRETARY-TREASURER REPORT
Andrew Kuljis presented the Membership Statistics report for review. He updated on the Elections and stated that they will be counting ballots on December 1, 2008.
PRESIDENT’S REPORT
1) David Marino talked about the Colorado Firefighter Memorial and indicated that they have obtained all the receipts for expenses. He reported that the total cost amounted to $3,055 which would be split with UFLAC.
2) David Marino referred to an issue regarding retirees that has been brought forward a few times. He asked what role the Association would play for its retirees when there is an injury/illness or IOD and the City does not help. John Jacobsen indicated that it is also a big problem for the Medical Plan because members who where off on an IOD pension are having problems obtaining their lifetime medical care so they use the Medical Plan. He suggested having some type of liaison or facilitator with Tri-star to coordinate appropriate care for the members. Doak Smith asked if the Union had been contact and/or approached regarding the issue. David Marino stated that he would continue to work on the issue and bring his findings to the Board.
AUDIT COMMITTEE REPORT
1) Doak Smith informed that they have made a selection for a new auditor. David Smith stated that the Audit Committee unanimously adopted the Harrington Group as the new auditor. He asked the Board to ratify the decision of the Audit committee to adopt the Harrington Group as the new auditors.
Doak Smith stated that he and the committee recommend the adoption of the Harrington Group as the new auditor for the Association. There was no discussion or objections.
Motion carried to adopt the Harrington Group as the new auditor for the Association.
SETTING DATES
1) LAFRA Open House – November 6th
2) Chili Cook Off – November 22, 2008 (7:00a.m. – 2:00p.m.)
3) Holiday Hoorah – December 13th Biltmore Hotel
RETIREMENT DINNERS
1) James Johnson – November 7th Fire Station 80 Noon
2) David Perez – November 14th Odyssey Restaurant Granada Hills
3) Roger Krueger – November 19th Taix Restaurant
4) Dan G. Butcher – November 20th Ports O’Call Restaurant
5) Danny Cook – December 3rd Ports O’Call Restaurant (Prine)
6) Gregory Frazier – December 3rd New Otani Hotel
7) Glen Prine – December 4th Ports O Call Restaurant (Marino)
8) Chuck Mills – January 7, 2009 LAPD Academy (Stires)
9) Jan Bernard – January 10th Valencia Summit Clubhouse
ADJOURNMENT
David Marino entertained a motion to adjourn. Juan Albarran so moved. Gary Matsubara seconded the motion. There was no discussion and no objections.
Motion carried to adjourn in.
The Board of Trustees meeting adjourned at 12:05pm.
David Marino, President