MEETING NUMBER 2914 JOURNAL OF PROCEEDINGS OF THE BOARD OF TRUSTEES OF THE POLICE AND FIRE RETIREMENT SYSTEM OF THE CITY OF DETROIT PROCEEDINGS HELD THURSDAY, DECEMBER 20, 2012 9:00 A.M. IN THE CONFERENCE ROOM OF THE RETIREMENT SYSTEMS 910 COLEMAN A. YOUNG MUNICIPAL CENTER DETROIT, MICHIGAN 48226 PRESENT Michael Bridges Mark Diaz Angela R. James Edsel Jenkins Brenda Jones James Moore Sean P. Neary Medina Noor George Orzech Jeffrey Pegg Lamont D. Satchel Michael Simon Louis Sinagra Tanya Stoudemire Cynthia A. Thomas David Cetlinski Ryan C. Bigelow Janet S. Lenear Joe Turner Ex/Officio Trustee/Deputy Treasurer Elected Trustee Ex/Officio Trustee Ex/Officio Trustee/Deputy Fire Commissioner Ex/Officio Trustee/City Council Representative Elected Trustee Elected Trustee Ex/Officio Trustee/Budget Director Alternate Elected Trustee/Vice Chairman Elected Trustee Ex/Officio Trustee, Labor Relations Director Elected Retirant Trustee Elected Retirant Trustee Ex/Officio Trustee/Acting Finance Director Alternate Executive Director Assistant Executive Director Investment Officer Recording Secretary Special Legal Counsel EXCUSED James Edwards Matthew Gnatek Ex/Officio Trustee/Corporation Counsel Alternate Elected Trustee/Chairman ABSENT None
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 2 CHAIRPERSON Matthew Gnatek VICE CHAIRPERSON George Orzech VICE CHAIRMAN ORZECH TOOK ROLL CALL AT 9:05 A.M. AND CALLED THE MEETING TO ORDER. DROP APPLICATIONS BY TRUSTEE PEGG SUPPORTED BY TRUSTEE DIAZ RESOLVED, THAT THE DROP APPLICATIONS WHICH ARE DESIGNATED BELOW BE APPROVED: DROP APPLICATIONS NAME, TITLE, DEPT., RETIREMENT, PLAN: BRIAN J. VOGEL FIRE FIGHTER F DROP - NEW SERVICE CREDIT, EFFECTIVE DATE: 20 00 09 11 27 12 NAME, TITLE, DEPT., RETIREMENT, PLAN: GILBERT HILL, JR. FIRE FIGHTER F DROP - NEW SERVICE CREDIT, EFFECTIVE DATE: 20 00 03 11 19 12 NAME, TITLE, DEPT., RETIREMENT, PLAN: RANDY JONES FIRE FIGHTER F DROP - NEW SERVICE CREDIT, EFFECTIVE DATE: 20 00 13 11 29 12 YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA AND VICE CHAIRMAN ORZECH 9 CONFIRMATIONS BY TRUSTEE PEGG SUPPORTED BY TRUSTEE DIAZ RESOLVED, THAT THE RECEIPTS AND DISBURSEMENTS WHICH ARE REFERENCED BELOW BE CONFIRMED:
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 3 CONFIRMATIONS - CONTINUED YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA AND VICE CHAIRMAN ORZECH 9 MINUTES OF NOVEMBER 15, 2012 AND NOVEMBER 29, 2012 BY TRUSTEE PEGG SUPPORTED BY TRUSTEE SIMON RESOLVED, THAT THE MINUTES OF THE MEETINGS HELD THURSDAY, NOVEMBER 15, 2012 AND THURSDAY NOVEMBER 29, 2012 BE APPROVED AS RECORDEDD AND SUBMITTED BY THE BOARD S RECORDING SECRETARY: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA AND VICE CHAIRMAN ORZECH 9 TRUSTEE TANYA STOUDEMIRE ENTERED THE MEETING AT 9:08 A.M.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 4 CAPITAL CALLS, FEES AND EXPENSES BY TRUSTEE NEARY SUPPORTED BY TRUSTEE PEGG WHEREAS, THE BOARD HAS BEEN PRESENTED WITH THE SUMMARY OF CAPITAL CALLS AND FEES AND EXPENSES WHICH ARE REFERENCED BELOW, AND WHEREAS, THE BOARD HAS BEEN REQUESTED TO APPROVE FUNDING OF SAID CAPITAL CALLS AND PAYMENT OF SAID FEES AND EXPENSES, THEREFORE BE IT RESOLVED, THAT SUBJECT TO FINAL APPROVAL OF ALL TRANSACTION DOCUMENTS BY THE BOARD S INTERIM LEGAL COUNSEL AND SUBJECT TO STAFF AUDIT, THE BOARD APPROVES FUNDING OF SAID CAPITAL CALLS AND PAYMENT OF SAID FEES AND EXPENSES: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 EXECUTIVE DIRECTOR S REPORTS EXECUTIVE DIRECTOR DAVID CETLINSKI DISCUSSED VARIOUS MATTERS WITH THE BOARD, INCLUDING TRUSTEE EDSEL JENKINS.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 5 PENSION NUMBER: 184252 REQUEST OF EDSEL JENKINS TO BE RE-INSTATED AS A MEMBER OF THE POLICE AND FIRE RETIREMENT SYSTEM OF THE CITY OF DETROIT BY TRUSTEE PEGG SUPPORTED BY TRUSTEE NEARY WHEREAS, THE BOARD IS IN RECEIPT OF A DECEMBER 13, 2012 LETTER FROM FINANCE DIRECTOR/GROUP EXECUTIVE CHERYL R. JOHNSON REQUESTING THAT EDSEL JENKINS BE RE-INSTATED AS A MEMBER OF THE POLICE AND FIRE RETIREMENT SYSTEM ( PFRS ), AND WHEREAS, EDSEL JENKINS WAS PREVIOUSLY GRANTED A SERVICE RETIREMENT EFFECTIVE FEBRUARY 11, 2003, AND WHEREAS, MR. JENKINS WAS RE-EMPLOYED IN THE FIRE DEPARTMENT AS DEPUTY FIRE COMMISSIONER EFFECTIVE JULY 16, 2012, AND WHEREAS, RETIREMENT SYSTEM PROVISIONS ALLOW FOR A RETIREE TO BECOME A MEMBER OF THE PFRS AS AN ACTIVE EMPLOYEE UNDER CERTAIN CONDITIONS AS SET FORTH IN A RESOLUTION DATED JANUARY 5, 1994 REGARDING ANOTHER RETIREE WHO WAS RE-INSTATED AS A POLICE OFFICER AND IMMEDIATELY PROMOTED TO POLICE CHIEF, WHICH PROVISIONS ARE INCORPORATED HEREIN BY REFERENCE, THEREFORE BE IT RESOLVED, THAT EDSEL JENKINS IS RE-INSTATED AS A MEMBER OF THE PFRS SUBJECT TO THE FOLLOWING: 1. PAYMENT OF PRIOR RETIREMENT BENEFITS SHALL BE TERMINATED AND ANY RETIREMENT SYSTEM AMOUNTS PAID AFTER JULY 16, 2012 SHALL BE REPAID TO THE PFRS (THE SUM OF $7,528.08) 2. PRIOR SERVICE CREDIT SHALL BE CREDITED TO MR. JENKINS 3. UPON MR. JENKINS FUTURE SEPARATION FROM SERVICE, PFRS BENEFITS BE GRANTED AND PAID CONSISTENT WITH THE RE-CALCULATION OF BENEFITS BASED UPON TOTAL SERVICE CREDIT AND UPDATED AVERAGE FINAL COMPENSATION, AND BE IT FURTHER RESOLVED, THAT A COPY OF THIS RESOLUTION BE FORWARDED TO EDSEL JENKINS AND FINANCE DIRECTOR/GROUP EXECUTIVE CHERYL. R. JOHNSON: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 6 MAPER S ONE-DAY SEMINAR BY TRUSTEE PEGG SUPPORTED BY TRUSTEE NEARY Resolved, That the Board approve the attendance of all Trustees, the Executive Director, the Assistant Executive Director and Special Legal Counsel at the below-referenced seminar, and be it further Resolved, That the Board approve expenditures for all Trustees, the Executive Director, the Assistant Executive Director, and Special Legal Counsel to attend said seminar: MAPERS ONE-DAY SEMINAR SHERATON HOTEL NOVI, MICHIGAN FEBRUARY 8, 2013 YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 DUTY DISABILITY RETIREMENT APPLICATIONS REGINALD O NEAL, THE BOARD S MEDICAL DIRECTOR, CONTACTED THE BOARD AT 9:11 A.M. (VIA PHONE CONFERENCE) TO DISCUSS THE DUTY DISABILITY RETIREMENT APPLICATIONS OF ROBIN MOLINARO AND JAMES ENGLISH, SO VICE CHAIRMAN ORZECH ASKED THE BOARD TO ENTER INTO CLOSED SESSION. CLOSED SESSION BY TRUSTEE SINAGRA SUPPORTED BY TRUSTEE SIMON WHEREAS, THE BOARD S MEDICAL DIRECTOR HAS CONTACTED (VIA PHONE CONFERENCE) THE BOARD OF TRUSTEES OF THE POLICE AND FIRE RETIREMENT SYSTEM OF THE CITY OF DETROIT TO DISCUSS THE MEDICAL AND PSYCHIATRIC REPORTS OF INDIVIDUALS WHO HAVE APPLIED FOR DISABILITY RETIREMENT, AND WHEREAS, THE MICHIGAN OPEN MEETINGS ACT PROVIDES FOR CLOSED SESSIONS IN CERTAIN CIRCUMSTANCES, INCLUDING THE FOREGOING MATTERS, AND WHEREAS, THE BOARD HAS DISCUSSED THIS MATTER CONSISTENT WITH THE MICHIGAN OPEN MEETINGS ACT, THEREFORE BE IT
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 7 CONTINUATION OF CLOSED SESSION RESOLVED, THAT THE BOARD ENTER INTO CLOSED SESSION CONSISTENT WITH THE MICHIGAN OPEN MEETINGS ACT: A ROLL CALL VOTE WAS TAKEN AS FOLLOWS: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 THE BOARD ENTERED INTO CLOSED SESSION AT 9:12 A.M. SPECIAL LEGAL COUNSEL JOE TURNER ENTERED THE MEETING DURING CLOSED SESSION (AT 9:16 A.M.). OPEN SESSION BY TRUSTEE NEARY SUPPORTED BY TRUSTEE SIMON RESOLVED, THAT THE BOARD RETURN TO OPEN SESSION: A ROLL CALL VOTE WAS TAKEN AS FOLLOWS: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 THE BOARD RETURNED TO OPEN SESSION AT 9:17 A.M. DUTY DISABILITY RETIREMENT APPLICATION EMPLOYEE INFORMATION NAME ROBIN MOLINARO TITLE OFFICER DEPARTMENT POLICE DISABILITY TYPE DUTY PLAN NEW DISABILITY POST TRAUMATIC STRESS DISORDER MEDICAL DUTY RELATED DIRECTOR S INJURY RECOMMENDATION PENSION AND 234782 SOCIAL SECURITY NUMBERS APPROVE DENY APPEAL TABLE X
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 8 CONTINUATION - ROBIN MOLINARO PENSION NUMBER 234782 BY TRUSTEE DIAZ SUPPORTED BY TRUSTEE SIMON RESOLVED, THAT THE BOARD ACCEPT THE REPORT AND RECOMMENDATION OF ITS MEDICAL DIRECTOR REGARDING ROBIN MOLINARO, AND BE IT FURTHER RESOLVED, THAT BASED UPON THE BOARD S MEDICAL DIRECTOR S RECOMMENDATION, THE BOARD HEREBY APPROVES MS. MOLINARO S APPLICATION FOR DUTY DISABILITY RETIREMENT: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 DUTY DISABILITY RETIREMENT APPLICATION EMPLOYEE INFORMATION NAME JAMES ENGLISH TITLE SERGEANT DEPARTMENT FIRE DISABILITY TYPE DUTY PLAN NEW DISABILITY RIGHT SHOULDER MEDICAL DUTY RELATED DIRECTOR S INJURY RECOMMENDATION PENSION AND 231845 SOCIAL SECURITY NUMBERS APPROVE DENY APPEAL TABLE X JAMES ENGLISH PENSION NUMBER 231845 BY TRUSTEE DIAZ SUPPORTED BY TRUSTEE SIMON RESOLVED, THAT THE BOARD ACCEPT THE REPORT AND RECOMMENDATION OF ITS MEDICAL DIRECTOR REGARDING JAMES ENGISH, AND BE IT FURTHER RESOLVED, THAT BASED UPON THE BOARD S MEDICAL DIRECTOR S RECOMMENDATION, THE BOARD HEREBY APPROVES MR. ENGLISH S APPLICATION FOR DUTY DISABILITY RETIREMENT: YEAS TRUSTEES DIAZ, JAMES, JENKINS, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 TRUSTEE BRENDA JONES ENTERED THE MEETING AT 9:25 A.M.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 9 WILSHIRE ASSOCIATES WILLIAM BENSUR AND FOUR ASSOCIATES (J.M. RUSCETTI, STEPHEN MARSHALL, MARLIN PEASE AND NICHOLAS SEFCHOK) APPEARED BEFORE THE BOARD AND DISCUSSED VARIOUS MATTERS, INCLUDING: WILSHIRE S SCOPE OF SERVICES THE SYSTEM S PORTFOLIO AND INVESTMENT POLICIES ALTERNATIVE INVESTING RISK/RETURN TRUSTEE MICHAEL BRIDGES ENTERED THE MEETING DURING WILSHIRE S PRESENTATION (AT 10:00 A.M.). TRUSTEE MEDINA NOOR ENTERED THE MEETING DURING WILSHIRE S PRESENTATION (AT 10:08 A.M.). TRUSTEE LAMONT SATCHEL ENTERED THE MEETING DURING WILSHIRE S PRESENTATION (AT 10:16 A.M.). RECESS THE BOARD RECESSED AT 10:17 A.M. AND TRUSTEE SATCHEL EXCUSED HIMSELF. VICE CHAIRMAN ORZECH CALLED THE MEETING BACK TO ORDER AT 10:30 A.M. AND WILSHIRE CONTINUED ITS PRESENTATION. TRUSTEE JONES EXCUSED HERSELF DURING WILSHIRE S PRESENTATION (AT 10:37 A.M.) AND RE-JOINED THE MEETING AT 10:58 A.M. TRUSTEE SATCHEL RE-JOINED THE MEETING AT THE CONCLUSION OF WILSHIRE S PRESENTATION. HAVING CONCLUDED THEIR PRESENTATION, MR. BENSUR AND HIS ASSOCIATES WERE EXCUSED AT 11:32 A.M. RECESS THE BOARD RECESSED AT 11:32 A.M. AND TRUSTEE SIMON EXCUSED HIMSELF. VICE CHAIRMAN ORZECH CALLED THE MEETING BACK TO ORDER 11:40 A.M.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 10 BANK OF NEW YORK MELLON ASSET SERVICING BY TRUSTEE DIAZ SUPPORTED BY TRUSTEE NOOR WHEREAS, the Board of Trustee received a letter dated November 13, 2012 from BNY Mellon Asset Servicing (the Board s Custodian Bank ) to Ryan Bigelow informing (the Board s Investment Officer ) of erroneous charges for various account relationships assessed to the Police and Fire Retirement System of the City of Detroit ( PFRS ) by the Board s Custodian Bank since 2003, and WHEREAS, the Board s Custodian Bank letter provides documentation to evidence a $105,004.77 net impact owed to PFRS and to credit the PFRS account with the adjusting entry, and WHEREAS, the Board s internal staff has verified the aforementioned $105,004.77 net adjustment owed to PFRS by the Board s Custodian bank, and WHEREAS, this matter has been considered by the Board, NOW THEREFORE BE IT RESOLVED, per the advice of staff, the Board accepts that $105,004.77 is the net amount owed to PFRS by the Board s Custodian Bank for erroneous charges to PFRS by the Board s Custodian Bank since 2003, and be it further RESOLVED, that the Board s Custodian Bank shall promptly credit the PFRS liquid reserve account $105,004.77 for repayment of the charges noted in the foregoing resolution, and be it further RESOLVED, that the Board s Custodian Bank shall be provided a copy of this resolution: DAVID BLAKELEY VICE PRESIDENT BNY MELLON ASSET SERVICING ONE WALL STREET NEW YORK, NEW YORK 10286 YEAS TRUSTEES BRIDGES, DIAZ, JAMES, JENKINS, JONES, MOORE, NEARY, NOOR, PEGG, SATCHEL, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 13 TRUSTEE SIMON RE-JOINED THE MEETING AT 11:46 A.M.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 11 GRAND PARK CENTER BY TRUSTEE PEGG SUPPORTED BY TRUSTEE NEARY WHEREAS, THE BOARD S REAL ESTATE ADVISOR, AMERICAN REALTY ADVISORS ( ARA ), PRESENTED THE BOARD WITH A REQUEST TO PROCEED WITH THE DISPOSITION OF GRAND PARK CENTER BASED UPON ITS EVALUATION OF GRAND PARK CENTER, AND WHEREAS, SAID REQUEST WAS SUBMITTED TO THE BOARD S REAL ESTATE CONSULTANT, COURTLAND PARTNERS, FOR REVIEW AND RECOMMENDATION, AND WHEREAS, COURTLAND PARTNERS HAS PRESENTED THE BOARD WITH A DECEMBER 12, 2012 COMMUNICATION WHEREIN COURTLAND PARTNERS RECOMMENDS THAT THE BOARD APPROVE ARA S REQUEST, THEREFORE BE IT RESOLVED, THAT ARA S REQUEST TO PROCEED WITH THE DISPOSITION OF GRAND PARK CENTER IS HEREBY APPROVED, AND BE IT FURTHER RESOLVED, THAT A COPY OF THIS RESOLUTION BE FORWARDED TO ARA AND COURTLAND PARTNERS: YEAS TRUSTEES BRIDGES, DIAZ, JAMES, JENKINS, JONES, MOORE, NEARY, NOOR, PEGG, SATCHEL, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 14 SPECIAL LEGAL COUNSEL S REPORTS SPECIAL LEGAL COUNSEL JOE TURNER PROVIDED THE BOARD WITH A STATUS UPDATE, RE: THE FOLLOWING CASES: FOIA REQUEST OF DETROIT NEWS REPORTER CHRISTINE MACDONALD USA VERSUS BEASLEY, DIXON AND MAYFIELD SENATE BILL 865 (COUNSEL TURNER WILL INFORM LUSCIUS VASSAR THAT HIS LOBBYING EFFORTS ARE NO LONGER NEEDED)
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 12 MANN 1100 PUD DALLAS, TEXAS LIMITED AUTHORIZATION OF BANYAN TO SIGN ON BEHALF OF THE PARTNERSHIP BY TRUSTEE NEARY SUPPORTED BY TRUSTEE SIMON WHEREAS, IN 2007, THE BOARD COMMITTED TO A $15,600,000 EQUITY INVESTMENT SPONSORED BY THE MCRAE GROUP OF COMPANIES WHOSE KEY PRINCIPAL WAS RON MCRAE WHO ALSO PROVIDED A $10,000,000 LIMITED PERSONAL GUARNTY TO FUND OPERATIONAL DEFICITS ONCE THE BOARD HAD FUNDED ITS $15,600,000 COMMITTMENT. THE FUNDING WAS SUBORDINATE TO AN EXISTING FIRST MORTGAGE OF $14,600,000 HELD BY THE LAND SELLER, MS. MANN. THE PLAN WAS TO SECURE ALL ENTITLEMENTS ON 1,100 ACRES OF UNDEVELOPED LAND AND MARKET TO AREA HOMEBUILDERS, AND WHEREAS, IN DECEMBER 2008, THE BOARD APPROVED THE ADDITIONAL PURCHASE BY THE PARTNERSHIP OF 29.4 ACRES FROM MS. MANN ALL OF WHICH WAS FINANCED BY MS. MANN WHO ALSO PROVIDED AN EXTENSION OF THE MATURITY IN THE LOAN TO 2016, AND WHEREAS, AS A RESULT OF MCRAE S FINANCIAL DIFFICULTIES AND HIS INABILITY TO MEET HIS OBLIGATIONS UNDER HIS GUARANTY, THE BOARD REACHED AGREEMENT TO EXIT MCRAE FROM THE ROLE OF GENERAL PARTNER AND NEGOTIATED A SETTLEMENT ON HIS GUARANTY AT $1, 450,000 PAID OUT OVER FIVE YEARS, AND WHEREAS, THE BOARD HAS FORMED A NEW ENTITY TO SERVE AS GENERAL PARTNER FOR THE LIMITED PARTNERSHIP ( COMPANY ) AND INORDER TO FACILITATE EFFECTIVE MANAGEMENT OF THE DAY TO DAY OPERATIONS HAS RECEIVED A LETTER FROM ITS ADVISOR REQUESTING AUTHORIZATION FOR LIMITED SIGNING AUTHORITY ON BEHALF OF THE GENERAL PARTNER, AND WHEREAS, THE BOARD IS IN RECEIPT OF A RESOLUTION PREPARED BY ITS SPECIAL COUNSEL THAT AUTHORIZES LOU VOGT OF BANYAN REALTY ADVISORS TO EXECUTE AND DELIVER SUCH DOCUMENTS AND AGREEMENTS ON BEHALF OF THE COMPANY AS HE, IN GOOD FAITH, AND ACTING WITH THE CARE OF A PRUDENT PERSON IN A LIKE POSITION WOULD EXERCISE UNDER SIMILAR CIRCUMSTANCES, AND THE BOARD HAS CONSIDERED THE RECOMMENDATION FROM BANYAN AND ITS SPECIAL COUNSEL, THEREFORE BE IT RESOLVED, THAT THE RESOLUTION PROVIDED BY SPECIAL COUNSEL BE APPROVED BY THE BOARD AND BE IT FURTHER RESOLVED, THAT A COPY OF THIS RESOLUTION BE FORWARDED TO BANYAN REALTY ADVISORS, LLC; AND THE BOARD S SPECIAL COUNSEL, CLARK HILL: YEAS TRUSTEES BRIDGES, DIAZ, JAMES, JENKINS, JONES, MOORE, NEARY, NOOR, PEGG, SATCHEL, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 14
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 13 MANN 1100 PUD DALLAS, TEXAS INTERIM BUDGET APPROVAL FOR 2013; $75,000 BY TRUSTEE NEARY SUPPORTED BY TRUSTEE SIMON WHEREAS, IN 2007, THE BOARD COMMITTED TO A $15,600,000 EQUITY INVESTMENT SPONSORED BY THE MCRAE GROUP OF COMPANIES WHOSE KEY PRINCIPAL WAS RON MCRAE WHO ALSO PROVIDED A $10,000,000 LIMITED PERSONAL GUARNTY TO FUND OPERATIONAL DEFICITS ONCE THE BOARD HAD FUNDED ITS $15,600,000 COMMITTMENT. THE FUNDING WAS SUBORDINATE TO AN EXISTING FIRST MORTGAGE OF $14,600,000 HELD BY THE LAND SELLER, MS. MANN. THE PLAN WAS TO SECURE ALL ENTITLEMENTS ON 1,100 ACRES OF UNDEVELOPED LAND AND MARKET TO AREA HOMEBUILDERS, AND WHEREAS, IN DECEMBER 2008, THE BOARD APPROVED THE ADDITIONAL PURCHASE BY THE PARTNERSHIP OF 29.4 ACRES FROM MS. MANN ALL OF WHICH WAS FINANCED BY MS. MANN WHO ALSO PROVIDED AN EXTENSION OF THE MATURITY IN THE LOAN TO 2016, AND WHEREAS, AS A RESULT OF MCRAE S FINANCIAL DIFFICULTIES AND HIS INABILITY TO MEET HIS OBLIGATIONS UNDER HIS GUARANTY, THE BOARD REACHED AGREEMENT TO EXIT MCRAE FROM THE ROLE OF GENERAL PARTNER AND NEGOTIATED A SETTLEMENT ON HIS GUARANTY AT $1,450,000 PAID OUT OVER FIVE YEARS, AND WHEREAS, THE BOARD HAS FORMED A NEW ENTITY TO SERVE AS GENERAL PARTNER FOR THE LIMITED PARTNERSHIP ( COMPANY ) AND INORDER TO FACILITATE EFFECTIVE MANAGEMENT OF THE DAY TO DAY OPERATIONS HAS RECEIVED A LETTER FROM ITS ADVISOR REQUESTING APPROVAL OF AN INTERIM BUDGET FOR 2013 OF $75,000, AND THE BOARD HAS CONSIDERED THE RECOMMENDATION FROM BANYAN, THEREFORE BE IT RESOLVED, THAT THE BOARD APPROVE FUNDING OF $75,000 CONSISTENT WITH BANYAN S REQUEST, AND BE IT FURTHER RESOLVED, THAT A COPY OF THIS RESOLUTION BE FORWARDED TO BANYAN REALTY ADVISORS, LLC; AND THE BOARD S SPECIAL COUNSEL, CLARK HILL: YEAS TRUSTEES BRIDGES, DIAZ, JAMES, JENKINS, JONES, MOORE, NEARY, NOOR, PEGG, SATCHEL, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 14 HEART AMENDMENTS/IRS DETERMINATION LETTERS THE BOARD DISCUSSED THE ABOVE CAPTIONED MATTERS WITH ED HAMMOND OF CLARK HILL VIA PHONE CONFERENCE. TRUSTEE NOOR EXCUSED HERSELF AT 12:10 P.M.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 14 HEART AMENDMENTS (HEROES EARNINGS ASSISTANCE AND RELIEF TAX ACT OF 2008) BY TRUSTEE PEGG SUPPORTED BY TRUSTEE MOORE WHEREAS, the Policemen and Firemen Retirement System of the City of Detroit (the Retirement System ) has been in compliance with the following provisions and should be formally amended to comply with certain provisions of the Heroes Earnings Assistance and Relief Tax Act of 2008 ( HEART ), and WHEREAS, a Good Faith HEART Act Amendment to the Policemen and Firemen Retirement System has been presented to the Board of Trustees, and WHEREAS, the Retirement System intends and continues its policy that the Retirement System comply and be administered in accordance with those applicable provisions of the Internal Revenue Code ( Code ) with respect to which tax qualified governmental retirement plans are required to comply in order to maintain tax qualified status pursuant to the Code, and WHEREAS, Special Counsel Ed Hammond has advised the Board on even date, and WHEREAS, the Board has considered this matter, THEREFORE BE IT RESOLVED, that the Board hereby adopts the Good Faith HEART Amendment in the form as first presented to the Board and continues to maintain and administer the Plan in accordance with applicable governmental plan Qualification Requirements, and be it further RESOLVED, that the appropriate individuals of the Policemen and Firemen Retirement System be and they hereby are authorized and directed to take whatever action is necessary to carry out the foregoing resolutions, and be it further RESOLVED, that a copy of this resolution be forwarded to the Board s Special Counsel: YEAS TRUSTEES BRIDGES, DIAZ, JAMES, JENKINS, JONES, MOORE, NEARY, PEGG, SATCHEL, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 13 USA VERSUS BEASLEY, DIXON AND MAYFIELD SPECIAL LEGAL COUNSEL JOE TURNER ASKED THE BOARD TO ENTER INTO CLOSED SESSION TO DISCUSS PENDING LITIGATION.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 15 CLOSED SESSION BY TRUSTEE PEGG SUPPORTED BY TRUSTEE MOORE Resolved, That the Board enter into Closed Session for the purpose of discussing pending litigation, and be it further Resolved, That General Retirement System Trustees Susan Glaser and Thomas Sheehan be permitted to attend said Closed Session. PRIOR TO VOTING ON TRUSTEE PEGG S MOTION, TRUSTEE SATCHEL EXPRESSED HIS CONCERN THAT ALLOWING TRUSTEES GLASER AND SHEEHAN TO ATTEND SAID CLOSED SESSION WOULD WAIVE THE BOARD S ATTORNEY/CLIENT PRIVILEGE RIGHTS. TRUSTEE JAMES EXCUSED HERSELF AT 12:22 P.M., AND TRUSTEE JENKINS EXCUSED HIMSELF AT 12:23 P.M. THE BOARD BRIEFLY RECESSED (AT 12:27 P.M.) AND COUNSEL TURNER AND TRUSTEES GLASER AND SHEEHAN EXCUSED THEMSELVES. TRUSTEES GLASER AND SHEEHAN AND COUNSEL TURNER RE-JOINED THE MEETING AT 12:29 P.M. TRUSTEES GLASER AND SHEEHAN THEN EXCUSED THEMSELVES. TRUSTEE PEGG S MOTION WAS AMENDED TO EXCLUDE TRUSTEES GLASER AND SHEEHAN FROM ATTENDING SAID CLOSED SESSION AND BROUGHT FORWARD FOR A VOTE: CLOSED SESSION BY TRUSTEE PEGG SUPPORTED BY TRUSTEE MOORE Resolved, That the Board enter into Closed Session for the purpose of discussing pending litigation: A Roll Call vote was taken as follows: YEAS TRUSTEES BRIDGES, DIAZ, JONES, MOORE, NEARY, PEGG, SATCHEL, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 11 The Board entered into Closed Session at 12:28 P.M. TRUSTEE SATCHEL EXCUSED HIMSELF DURING CLOSED SESSION (AT 12:37 P.M.). OPEN SESSION BY TRUSTEE NEARY SUPPORTED BY TRUSTEE DIAZ Resolved, That the Board return to Open Session: A Roll Call vote was taken as follows:
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 16 OPEN SESSION - CONTINUED YEAS TRUSTEES BRIDGES, DIAZ, JONES, MOORE, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 10 The Board returned to Open Session at 12:51 P.M. TRUSTEE MOORE EXCUSED HIMELF AT 12:54 P.M. FIRST FIDUCIARY REALTY ADVISORS, INC. ( FFRA ) BY TRUSTEE NEARY SUPPORTED BY TRUSTEE PEGG WHEREAS, THE BOARD HAS BEEN REQUESTED TO EXECUTE A WAIVER REGARDING REAL ESTATE INVESTMENT FFRA AND ASSET MANAGEMENT AGREEMENT BETWEEN FFRA AND THE FUND, AND WHEREAS, THE EXECUTION OF SAID DOCUMENT HAS BEEN RECOMMENDED BY FFRA, AND WHEREAS, THE EXECUTION OF SAID DOCUMENT HAS BEEN REVIEWED AND APPROVED AS TO FORM BY THE BOARD S INTERIM GENERAL COUNSEL AND THE EXECUTION OF SAID DOCUMENT IS CONSISTENT WITH PRIOR ACTION OF THE BOARD, THEREFORE BE IT RESOLVED, THAT SAID DOCUMENT BE EXECUTED ON BEHALF OF THE RETIREMENT SYSTEM, AND BE IT FURTHER RESOLVED, THAT THE EXECUTED ORIGINAL DOCUMENT BE FORWARDED TO THE APPROPRIATE PARTY, AND BE IT FURTHER RESOLVED, THAT THE RETIREMENT SYSTEM RETAIN A COPY OF SAID EXECUTED ORIGINAL DOCUMENT, AND BE IT FURTHER RESOLVED, THAT A COPY OF THIS RESOLUTION BE FORWARDED TO FFRA, AND BE IT FURTHER RESOLVED, THAT THE RETIREMENT SYSTEM RETAIN A COPY OF THIS RESOLUTION FOR ITS FILES: YEAS TRUSTEES BRIDGES, DIAZ, JONES, NEARY, PEGG, SIMON, SINAGRA, STOUDEMIRE AND VICE CHAIRMAN ORZECH 9 TRUSTEE STOUDEMIRE EXCUSED HERSELF AT 12:55 P.M., AND TRUSTEE MOORE RE JOINED THE MEETING AT 12:56 P.M.
MEETING NUMBER 2914 THURSDAY DECEMBER 20, 2012 17 POLICE AND FIRE RETIREMENT SYSTEM BOARD MEETINGS BY TRUSTEE SIMON RESOLVED, THAT THE BOARD S MOTION TO MEET EVERY OTHER THURSDAY AS OPPOSED TO EVERY THURSDAY, WHICH WAS TABLED OCTOBER 11, 2012, BE REMOVED FROM THE TABLE: TRUSTEE SIMON S MOTION RECEIVED NO SUPPORT. PUBLIC FORUM AT 1:00 P.M., VICE CHAIRMAN ORZECH DECLARED THE MEETING IN OPEN FORUM FOR GENERAL DISCUSSION BY THE PUBLIC ATTENDING THE MEETING. ADJOURNMENT THERE BEING NO FURTHER BUSINESS BEFORE THE BOARD, VICE CHAIRMAN ORZECH ADJOURNED THE MEETING AT 1:00 P.M. UNTIL THURSDAY, JANUARY 10, 2013 AT 9:00 A.M., IN ROOM 910 OF THE COLEMAN A. YOUNG MUNICIPAL CENTER, DETROIT, MICHIGAN 48226. RESPECTFULLY SUBMITTED, DAVID CETLINSKI, ASSISTANT EXECUTIVE DIRECTOR