HomeMy WebLinkAbout05-04-20 Meeting MinutesGalesburg Fire Pension Fund Board of Trustees Meeting
City Hall, Erickson Conference Room
55 West Tompkins Street, Galesburg, Illinois
May 4, 2020
9:00 a.m.
Call to order by President Jim Pendergast at 9:00 a.m.
Physically Present:Kelli Bennewitz,Jim Pendergast,and John Seitz.Present Via Telephone:
Jeremy Karlin and Mike Whitson.Others Present Via Telephone:Alex Courtney,Larry Richey,
Kelly Weller, Bruce Ebel, and Joe Brignall.
Larry Richey stated that since the end of April,he has been sending out weekly updates in light
of the COVID-19 pandemic and its impact on the economy.He stated that he is humbled to
work with teams of firefighters,medical personnel,etc.and that we are all facing an unknown
like no one has ever seen before.
The following information is from the March 31, 2020, investment review:
General Economy
●Mandated social distancing undertaken to contain pandemic COVID-19 is torquing the
global economy into a recession.Adding to duress is a Saudi/Russia oil price war.The
U.S.economy is expected to shrink by about 6%for all of 2020,with 2Q 2020 GDP
possibly contracting by over 30%.
●Over 10 million people applied for unemployment in March alone,boosting the
unemployment rate to 4.5% with the likelihood it will exceed 10% soon.
●Massive,swift Congressional action geared towards sustaining business viability
produced stimulus programs exceeding $2 trillion or 12%of GDP,all within 11 weeks of
the identification of the need.Earnings are expected to plummet,near term,but unlike
a shooting war, means of production have not been destroyed.
Equity
●In 23 trading days the S&P 500 dropped ~34%from its all-time high of 3386 on February
19th to a low on March 23rd of 2237.For the quarter,the S&P 500 was down just under
20%,all sectors had negative returns,with tech down the least,~12%and energy the
worst, ~ 50%.
●Neither size nor style were immune from negative returns.However,large cap equities,
and particularly those in the growth style,were down less than international,value,or
small cap.
●Volatility of equities,as measured by the CBOE Volatility Index,recently exceeded that
experienced during the Great Financial Crisis (GFC).Sharp declines improved relative
valuations versus fixed income,but the key driver will likely be virus containment
progress, as yet elusive.
___________________________________________________________________________________________________________________________________________________________________________________________
Galesburg Firefighters’ Pension Fund Page 1 of 3
Fixed Income
●The Federal Reserve responded aggressively in March,cutting rates by 50 basis points
on March 3rd,then slashing rates to zero following an emergency Sunday meeting on
March 15th. All were in response to evolving virus uncertainty.
●Yield on U.S.Treasuries started 2020 at 1.88%,hit an all-time low of 0.31%on March
9th, and ended the quarter at 0.70%.
●Spreads of credit-related fixed income securities widened dramatically during the
quarter as investors sold what they could to raise cash.The Federal Reserve initiated a
series of programs to provide liquidity and restore orderly markets.
Bruce Ebel discussed the pandemic event and response.The pension fund’s portfolio showed
an ending market value of $20,568,851 as of March 31,2020.The fund is showing 46.5%fixed
income, 49.5% equity investments and 4% cash. Other items noted:
●Quarter to date shows a loss of 12.8%
●It was discussed to move $1M from fixed income to equity to increase to 50-52%
●Kelli will send a request to move $250,000 for upcoming payroll
A copy of the performance review has been attached to this official record.
Larry Richey stated that he was sorry they couldn’t meet in person but understands.He hopes
everyone stays healthy and goes out on a minimum basis.
Alex Courtney presented the financial statements for the fund ending March 31,2020.Total
assets are $21,257,948 and total liabilities are $20,994,276.He also provided a transaction
report for the period January - March 2020.
John Seitz moved,seconded by Mike Whitson,to approve the financial statement as of March
31, 2020. The motion carried.
John Seitz moved, seconded by Jim Pendergast, to approve the following slate of officers:
President - Jim Pendergast
Vice President - John Seitz
Secretary - Kelli Bennewitz
The motion carried.
Jim Pendergast moved,seconded by Mike Whitson,to approve the minutes from the February
3, 2020, meeting. The motion carried.
New Business
___________________________________________________________________________________________________________________________________________________________________________________________
Galesburg Firefighters’ Pension Fund Page 2 of 3
John Seitz moved,seconded by Mike Whitson,to approve the retirement of Michael
McDorman as of March 2, 2020, with a salary of $5,056.60. The motion carried.
John Seitz moved,seconded by Jim Pendergast,to approve firefighters Kyle McGee and Jacob
Pedigo into the Galesburg Firefighters’ Pension Fund. The motion carried.
Old Business
None
Next meeting date will be August 3, 2020.
Public Comment – None.
There being no further business, the meeting adjourned at 10:02 a.m.
______________________________________________________________
Jim Pendergast, President Kelli R. Bennewitz, Secretary
___________________________________________________________________________________________________________________________________________________________________________________________
Galesburg Firefighters’ Pension Fund Page 3 of 3