NJ MUNICIPAL ENVIRONMENTAL RISK MANAGEMENT FUND OPEN MINUTES MEETING OF JUNE 7, 2012 JAMESBURG, NEW JERSEY 10:50 AM

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1 NJ MUNICIPAL ENVIRONMENTAL RISK MANAGEMENT FUND OPEN MINUTES MEETING OF JUNE 7, 2012 JAMESBURG, NEW JERSEY 10:50 AM Meeting called to order by Richard Brook. record. The Open Public Meeting Notice was read into the ROLL CALL OF EXECUTIVE COMMITTEE: Chairman: Burlco Richard Brook Present Secretary: Monmouth Thomas Nolan Present Executive Committee: Camden Joe Wolk Present NJUA Jerry Cevetello Present South Bergen Peggy Thomas Present Ocean Paul Shives Present Morris Frank Wilpert Present Trico John Salvatore Present Alternates: #1 Central Robert Landolfi Absent #2 Bergen Ken Gabbert Present #3 Suburban Essex Joe Catenero Present #4 Sub Muni Jim Gildea Present #5 PMM Scott Carew Absent APPOINTED OFFICIALS PRESENT: Executive Director/ PERMA Risk Management James Kickham Present Administrator Services Attorney Fred Semrau Present Treasurer Charles S. Cuccia Present Underwriting Managers The Danskin Agency Conner Strong & Buckelew Cindy Lisa Chuck Casagrande Mike Avalone Joe Hrubash Present Present Absent Present Claims Administrator Peter King, Esquire Present Environmental Engineering The BSG/PMK Group Richard Erickson Present Services Actuary AON Chaz Kullman Present Auditor Nisivoccia, L.L.P. Francis Bud Jones Present OTHERS PRESENT: David Grubb, PERMA Steve Sacco, PERMA Cate Kiernan, PERMA Mary Lou Doner, PERMA Brad Stokes, PERMA Jason Thorpe, PERMA Frank Covelli, RMC William Dunn, MH MUA Cathy Dodd, PERMA

2 Ilene Laursen, CS&B Jason Gabloff, Millburn William Close, Dover Jon Rheinhardt, Wharton Barry Vankat, Wells Fargo Bank, NA Jeff Lang, Wells Fargo Capital Mgt. APPROVAL OF MINUTES: March 7, 2012 MOTION TO APPROVE OPEN AND CLOSED MINUTES OF MARCH 7, 2012 Commissioner Catenaro CORRESPONDENCE : TREASURER Mr. Charles Cuccia presented his report and Resolution No confirming the April Bill List, Resolution No confirming the May Bill List and Resolution No approving the June Bill List as follows: RESOLUTION APRIL BILL LIST FUND YEAR AMOUNT 2011 $ 23, $ 105, Total $ 128, RESOLUTION MAY BILL LIST FUND YEAR AMOUNT 2012 $ 76, Total $ 76, RESOLUTION JUNE BILL LIST FUND YEAR AMOUNT 2012 $ 36, Total $ 36, MOTION TO APPROVE PAYMENT OF BILLS - RESOLUTION NO , AND Commissioner Thomas

3 AUDITOR AND ACTUARY YEAR-END REPORTS - Enclosed in the agenda booklet is the Audit Report as of December 31, Bud Jones from Nisivoccia and Company was present at the meeting and reviewed the Audit Report. Mr. Jones advised the Committee that the Fund earned 3.9 million in revenue during He added that the Fund is excellent financial condition as of 12/31/11. Mr. Jones also referred the Committee to the Auditor Management Report and stated that there were no recommendations. Following Mr. Jones presentation, Mr. Kickham advised that the enclosed Resolution and Group Affidavit had to be executed. MOTION TO APPROVE YEAR-END FINANCIALS, ADOPT RESOLUTION NO AND EXECUTE GROUP AFFIDAVIT INDICATING THAT MEMBERS OF THE EXECUTIVE COMMITTEE HAVE READ THE GENERAL COMMENTS SECTION OF THE AUDIT REPORT. Commissioner Wilpert EXECUTIVE DIRECTOR/ADMINISTRATOR: MEL INVESTMENT COMMITTEE: A meeting on the JIF and MEL s Banking & Asset Management contract was held on May 30 th regarding the formation of a Unitized Trust. Mr. Kickham stated that, after working diligently on this mater and gathering opinions from outside counsel, it is the MEL Investment Committee s recommendation to move forward on the Unitized Trust. Mr. Kickham added that Mr. Cuccia spearheaded a lot of the work. Chairman Brook asked that either Mr. Cuccia or Mr. Rheinhardt to update the Board on the formation of a Unitized Trust. Mr. Rheinhardt informed the Board that the MEL Investment Committee met repeatedly with the attorneys and stated that they are very comfortable with where they are in this matter. He added that the initiation would start over the next 45 days. It will start with the MEL, RCF and the E-JIF and then extend it out to the smaller JIFs to join in at that point. Chairman Brook thanked Mr. Rheinhardt for the update and stated that a Motion was needed on Resolution MOTION TO ADOPT RESOLUTION # AUTHORIZING THE PARTICIPATION OF THE E-JIF IN A SHARED SERVICES AGREEMENT FOR THE FORMATION OF A UNITIZED INVESTMENT TRUST; WITH THE MUNICIPAL EXCESS LIABILITY JOINT INSURANCE FUND TO ACT AS THE LEAD AGENCY. Mr. Kickham advised the Committee that a representative from Wells Fargo was present at the meeting. Mr. Cuccia introduced Mr. Barry Vankat of Wells Fargo to the Committee and stated that he was a Government Banker for the State of New Jersey. Mr. Vankat stated that Wells Fargo was pleased and proud to be involved and they are looking forward to getting

4 the new investments set up. He advised that he is available to address any questions. Chairman Brook thanked Mr. Vankat and stated a motion was needed on Resolution MOTION TO ADOPT RESOLUTION # AUTHORIZING THE EJIF TO APPOINT AN ASSET MANAGER Commissioner Gabbert Commissioner Gildea LEGAL RESEARCH OF THE UNITIZED TRUST- Mr. Kickham advised the Committee that the MEL hired the Law firm of Inglesino, Pearlman, Wyciskala & Taylor LLC to do the original research and receive a legal opinion on the creation, authorization, and operation of the Unitized Investment Trust. Mr. Kickham stated that after going through a number of drafts with the law firm, the MEL budget was exceeded, and help from the RCF and the E-JIF was needed for the remainder of the bill not to exceed $7,500 for legal research and opinion. MOTION TO AUTHORIZE UP TO $7,500 TO ASSIST THE MEL IN THE PAYMENT OF THE LEGAL RESEARCH AND OPINION FOR THE INVESTMENT TRUST UNDER THE JOINT INSURANCE FUND ACT AND OTHER APPLICABLE LAWS OF THE STATE OF NEW JERSEY Commissioner Catenero 2012 AMENDED BUDGET- Mr. Kickham referred the Committee to the copy of the amended 2012 budget enclosed in the agenda booklet which reflects the changes in membership from the local JIFs. The 2012 contracts reflect these additions so no professional contract addendums are needed. MOTION TO APPROVE THE AMENDED 2012 BUDGET TO REFLECT THE CHANGES IN MEMBERSHIP FOR FUND YEAR Commissioner Cevetello LEGISLATIVE AGENT RFQ- Mr. Kickham reminded the Committee of a prior meeting discussion regarding the EJIF becoming pro active with the Administration and legislative branch with respect to specific large cases effecting the members of the EJIF. It is the recommendation of the Rules and Contracts Committee, that the E-JIF hire a legislative agent to educate the administration and the legislators on the facts of the Newark Bay case and advocate for an indemnification agreement. Further, in order not to have a repeat on

5 other river basins, the legislative agent would work with us on new legislation to effectively indemnify the municipalities in the future on similar litigation. Mr. Kickham advised the Committee of the proposed RFQ enclosed in the agenda booklet. The Fund will have to advertise, pursuant to N.J.S.A. 19:44A-20.4 et. seq for the position of legislative agent and adopt the previous criteria used by the EJIF and contained in the enclosed RFQ, in awarding the contract. He added that the RFQ would not be advertised until at least September. MOTION TO AUTHORIZE THE EXECUTIVE DIRECTOR TO ISSUE AN RFQ FOR A LEGISLATIVE AGENT POSITION PURSUANT TO N.J.S.A. 19:44A-20.4 ET. SEQ AS OUTLINED IN THE ATTACHED RFQ WHICH ESTABLISHES THE CRITERIA FOR THIS POSITION. Commissioner Salvatore Commissioner Gabbert LAGOON DRIVE PROPERTY/ PUBLIC AUCTION Mr. Kickham informed the Committee that a No Further Action letter was received in regards to the Lagoon Drive property in Toms River. Mr. Kickham referred the Committee to memorandum from the Fund attorney outlining the process for the sale of 38 Lagoon Drive contained in the agenda packet. This property, currently owned by the EJIF, will have to be sold at a public auction. MOTION TO ADOPT RESOLUTION NUMBER AUTHORIZING THE SALE OF THE PROPERTY LOCATED AT 38 LAGOON DRIVE, TOMS RIVER, NJ AS OUTLINED IN THE MEMORANDUM PROVIDED BY THE FUND ATTORNEY Commissioner Nolan 2012 BILLINGS- The first assessment installment was sent to our member JIF s in February. The second installment billings will be mailed next month. WEB SITE- A reminder that the EJIF s web site is up and running and can be found at PERMA RELOCATION Mr. Kickham advised the Committee that the PERMA office has moved into its new facilities in Parsippany. The new office address is: PERMA Risk Management Services 9 Campus Drive Suite 16 Parsippany, NJ Mr. Kickham added that a motion on Resolution #22-12 was needed to update the Fund Records.

6 MOTION TO ADOPT RESOLUTION #22-12 CHANGING THE PERMA ADDRESS FOR FUND RECORDS. Commissioner Catenero Commissioner Thomas ATTORNEY: CLAIMS: No report. Mr. King indicated that his report would be given during closed session. UNDERWRITING MANAGERS: POLICY REWRITE Mr. Casagrande advised the Committee of continual meetings and negotiations between the Fund s Underwriting Managers and the Fund s Excess Carrier regarding the policy rewrite. He added that the new policy will not be presented to the Board until the Underwriting Managers feel that it is ready. UNDERGROUND PIPING ASSOCIATED WITH ABOVEGROUND STORAGE TANKS Mr. Casagrande advised the Committee of memorandums that were sent out in regards to Underground Piping. He added that the memo was very technical and BSG was available to answer any questions. Mr. Casagrande advised that effected members have until July 1, 2013 to comply and that there was a reimbursement process. UST BULLETIN Mr. Casagrande advised the Committee that as of January 1, 2014, the Fund will no longer cover unregulated underground storage tanks and that next year will be the last year that UST Bulletins will be sent to members. With nothing further, Mr. Casagrande concluded his report. ENVIRONMENTAL ENGINEERING: Mr. Erickson advised the Committee that the final version of the underground piping bulletin can be viewed on the EJIF website. He added that several Member Municipalities have already been tested. So far every test has passed and the results will be forwarded to Mr. Sacco. Mr. Erickson also informed the Committee that BSG provided 8 hours of training at the NJWEA Conference for the Utility Authorities and it was well received. Chairman Brook thanked Mr. Erickson, Mr. Casagrande, and Ms. Lisa for sending out the information on Aboveground Storage Tanks (AST).

7 ACTUARY No Report. OLD BUSINESS: NEW BUSINESS: PUBLIC COMMENT: CLOSED SESSION: MOTION TO ENTER EXECUTIVE SESSION TO DISCUSS CLAIMS/POTENTIAL LITIGATION Commissioner Cevetello MOTION TO ADJOURN MEETING Commissioner Thomas Commissioner Catenaro Meeting Adjourned: 11:27 AM Next Meeting: September 2012 Forsgate CC Jamesburg Respectfully submitted, Prepared by Jason D. Thorpe, Assistant Secretary