Colorado Public Employees Retirement Association Board Meeting Minutes

Transcription

1 Colorado Public Employees Retirement Association Board Meeting Minutes Raymond Doc Heath Memorial Boardroom 1301 Pennsylvania Street Denver, Colorado March 17, :30 a.m. Trustees Present: Timothy M. O Brien, Chairman, Karl Fisch, Vice Chairman, Will Bain, Guillermo Barriga, Amy Grant, David Hall, Roger Johnson, Suzanne Kubec, Carolyn Jonas-Morrison, Robert Lamb, Susan Murphy, Bill Parker, Marcus Pennell, Walker Stapleton, Carole Wright Via Conference Call: Lynn Turner Staff Present: Ron Baker, Donna Baros, Adam Franklin, Katie Kaufmanis, David Mather, Tara May, Amy McGarrity, Brenda Meidl, Lawrence Mundy, Karl Paulson, Gregory W. Smith Timothy M. O Brien, Chairman, called the meeting to order at 8:30 a.m. Approval of the Consent Agenda A motion was made by Carolyn Jonas-Morrison and seconded by Roger Johnson that, the Board approve the Consent Agenda as published with the following items: a. b. c. d. e. f. g. h. Approval of Agenda Approval of January 20, 2017, Board Meeting Minutes (Tab A) Approval of February 10, 2017, Special Board Meeting Minutes (Tab B) Sudan Report (Tab C) Governance Compliance Report (Tab D) Anti-BDS Report (Tab E) Board Education Needs Assessment (Tab F) Resolution for Signature Authorization (Tab G). The motion was approved. Public Comment Bob Furlong, PERA retiree, thanked the Board for their efforts and encouraged them to continue their excellent work.

2 Page 2 of Board Election Ron Baker, PERA Chief Administrative Officer, provided information regarding the 2017 Board Election. A motion was made by Carole Wright and seconded by Bill Parker that, the Board approve the appointment of Julie Friedemann for the Retiree Trustee position elected by the retired members of the School, Local Government, and Judicial Divisions on the Board of Trustees for a four-year term beginning July 1, 2017, as she is the sole candidate duly nominated and eligible to be elected to the position. Further, I move that the Board direct staff to not go forward with the election for the Retiree position to be elected by the retired members of the School, Local Government, and Judicial Divisions. The motion was approved. A motion was made by David Hall and seconded by Bob Lamb that, the Board direct staff to conduct an election for two seats in the School Division to be elected by the members of that division and to include in that election the following slate of candidates: Guillermo Barriga Kristine Mueh Marcus Pennell. The motion was approved. A motion was made by Susan Murphy and seconded by Carolyn Jonas-Morrison that, the Board approve the appointment of Suzanne Kubec for the State Division Trustee position on the Board of Trustees for a four-year term beginning July 1, 2017, as she is the sole candidate duly nominated and eligible to be elected to the position. Further, I move that the Board direct staff to not go forward with the election for the State Division position. The motion was approved. Committee Reports Executive Committee Karl Fisch, Vice Chairman, reported that the Committee met on March 13, 2017, and approved the January 13, 2017, Executive Committee minutes. The Committee discussed the Board s Self-Evaluation, which will be reviewed by the Evaluation Committee at the Committee s June 22, 2017, meeting. In addition, the Committee reviewed the December 31, 2016, and January 31, 2017, Unaudited Financial Statements and the January 31, 2017, and February 28, 2017, Budget Reports. Finally, they reviewed the agenda for the.

3 Page 3 of 7 Audit Committee Robert Lamb, Committee Chair, reported that the Committee met the previous day and received an update regarding the Colorado PERA 2016 Financial Audit. In addition, the Committee received updates regarding the 2016 Comprehensive Annual Financial Report, the Risk Management Strategic Initiative, Colorado PERA Compliance with Standards of Professional and Ethical Conduct, and on Internal Audit Activity Status. Finally, the Audit Committee had a private meeting with PERA Director of Internal Audit. Benefits Committee Carole Wright, Chair, Benefits Committee, reported that the Committee met the previous day and received information regarding the CAP Annual Report and the Disability Program. In addition, the Committee received updates regarding the PERACare and Life Insurance programs, what constitutes member contributions, and the satellite office project. Compensation and Budget Committee Roger Johnson, Chair, Compensation and Budget Committee, reported that the Committee met the previous day and approved two Trustee education substitution requests and the Committee received information regarding 2016 PERA Employee Metrics. Investment Committee Susan Murphy, Chair, Investment Committee, reported that the Committee met the previous day and received information and approved an Asset Allocation Interim Target recommendation that will be presented to the Board for consideration at the June 23, 2017, Board meeting. In addition, the Committee received information regarding investment program discretion limits, the Statement of Investment Policy and internal investment compliance, the CFA Asset Manager Code, a Brokerage Commission Report and Cost Effectiveness Report. Amy McGarrity, PERA Chief Investment Officer, responded to questions. Shareholder Responsibility Committee Lynn Turner, Chair, Shareholder Responsibility Committee, reported that the Committee met the previous day and received information regarding securities litigation and company engagement, a 2016 Proxy Season Report, and a summary of the recent Council of Institutional Investors meeting. Stakeholder Relations Committee Amy Grant, Chair, Stakeholder Relations Committee, reported that the Committee met the previous day and received a presentation of the Stakeholder Outreach Program outline.

4 Page 4 of 7 Legislative Update Gregory W. Smith, PERA Executive Director, provided information regarding HB : Judicial PERA Contribution Rate Bill. A motion was made by Will Bain and seconded by Suzanne Kubec that, the Board support HB Mr. Smith responded to questions. The motion passed with two nay votes by Walker Stapleton and Lynn Turner. Mr. Smith provided a presentation regarding the legislative activities related to Colorado PERA. Lastly, Mr. Smith provided an update on Federal legislation related to public pension funds and responded to questions. CAFR Process Gregory W. Smith, PERA Executive Director and Lawrence Mundy, PERA Chief Financial Officer, reported that the CAFR timeline was revised to include an additional Audit Committee Meeting to be held on June 7, 2017, to allow for discussion of any written comments from Trustees. Mr. Mundy and Mr. Smith responded to questions. Executive Director Performance Plan Gregory W. Smith, PERA Executive Director, presented the Executive Director Performance Report related to Communications. This report was transmitted to Trustees as Tab H. Strategic Update Gregory W. Smith, PERA Executive Director, and Tara May, PERA Chief Communications Officer, provided a presentation regarding the Outreach Tour. Mr. Smith and Ms. May responded to questions. The Board recessed at 10:07 a.m. and reconvened at 10:18 a.m. Information Technology Update Cyber Security Ron Baker, PERA Chief Administrative Officer, requested that the Board go into Closed Executive Session. Timothy M. O Brien, Chairman, Board of Trustees, asked for a motion. A motion was made by Robert Lamb and seconded by Bill Parker that, the Board to go into Closed Executive Session, the issues to be discussed involve details of computer system security arrangements concerning PERA. The motion passed. The Closed Executive Session began at 10:19 a.m. In addition to the Trustees, the Executive Director and the General Counsel, all the Chief Officers, the Directors of Internal Audit, Planning, Policy, and Budget, Information Technology, the Public Information Officer, the Senior Staff Attorney, and the Manager of the Executive

5 Page 5 of 7 Director s Office participated in the Closed Executive Session. The Closed Executive Session concluded at 11:21 a.m. David Hall left the meeting at 11:06 a.m. during the above discussion and did not return. By my signature below, I certify that the only issues discussed by the members of the Board during the Closed Executive Session were regarding details of computer system security arrangements concerning PERA. Timothy M. O Brien, Chairman, Board of Trustees Staff Reports Executive Director Report Gregory W. Smith, PERA Executive Director, reviewed the Executive Director Report and recent activities. The information was transmitted to Trustees as Tab I on March 3, Market & Portfolio Update Amy McGarrity, PERA Chief Investment Officer, provided a market and portfolio update presentation. The Investment Performance Report and presentation were transmitted to Trustees as Tab J1 March 3, 2017, and Tab J2 on March 15, Benefits Update Donna Baros, PERA Chief Benefits Officer, provided an update on Benefits. This information was transmitted to Trustees as Tab K on March 9, Ms. Baros responded to questions. General Counsel Update Adam L. Franklin, PERA General Counsel, introduced the Legal Division intern Susan Malcom. Mr. Franklin provided a presentation with information from the General Counsel Report, which was transmitted to Trustees as Tab L on March 10, Mr. Franklin requested that the Board go into Closed Executive Session. The issues to be discussed involved pending or imminent litigation and specific legal questions addressed to the General Counsel regarding the following: Settlements Colorado PERA and trust funds et al. v. BP. PLC et al. Trustees of the Mineworkers Pension Scheme Limited, et al. v. The Royal Bank of Scotland Group, PLC Volkswagen Foreign Litigation

6 Page 6 of 7 Petrobras Arbitration Janet Walcott v. PERA, Gregory W. Smith, and Brian Pippin Elham Salemi v. PERA, Tim Moore, and Angela Setter McDivitt v. PERA et al. Cornish v. PERA Mirich v. PERA Della M. Donna-Matthews and Linda F. Donna v. Kaiser and PERA. Timothy M. O Brien, Chairman, Board of Trustees, asked for a motion. A motion was made by Marcus Pennell and seconded by Carole Wright that, the Board to go into Closed Executive Session, the issues to be discussed are regarding pending and imminent litigation and legal advice related to specific questions involving PERA constituting attorney client communication. The motion was approved. Closed Executive Session began at 12:11 p.m. In addition to the Trustees, the Executive Director, the General Counsel, all the Chief Officers, the Director of Planning, Policy, and Budget, the Public Information Officer, the Senior Staff Attorney, the Staff Attorney, the Legal Division Intern, the Paralegal II, and the Manager of the Executive Director s Office, participated in the Closed Executive Session. The Closed Executive Session concluded at 12:20 p.m. By my signature below, I certify that the only issues discussed by the members of the Board during the Closed Executive Session were regarding pending and imminent litigation and legal advice related to specific questions involving PERA constituting attorney client communication. Timothy M. O Brien, Chairman, Board of Trustees Other Business Timothy M. O Brien, Chairman, announced that this was the last meeting for Karl Fisch, Vice Chair, as he will be retiring on June 1, Mr. O Brien thanked him for his service and the Board recognized Mr. Fisch by acclamation. With no further business to discuss, Mr. O Brien adjourned the meeting at 12:22 p.m.

7 Page 7 of 7 Board Meeting Dates September 20 22, 2017 (Board Planning Session) November (16) 17, 2017 Respectfully submitted by Brenda E. Meidl Manager of the Executive Director s Office Timothy M. O Brien, Chairman, Board of Trustees Gregory W. Smith, Executive Director Approval Date: June 23, 2017