1996/06/13 PENSION INVESTMENT COMMITTEE MEETING
'Ec EIVED FOR FIL G
JUNE 13, 1996 93 JUN
? I r.M IC: ! 6
The semi annual meeting of the Pension Investment Committee was . ,
called to order at 2 : 41 p.m. in the Council Chambers, Town Hall, f,/ .
by Chairman Gary Clinton. rrv-
PRESENT: Gary Clinton - Chairman, Nancy Lockwood, Juliette
Benjamin, Roman Czuechta, Stanley Chaznowski, and Nick
Chirico. P. Stanley Shavers - VP Fixed Income and
Melanie El-Sabaawi - Investment Analyst both from ICMA
Retirement Corporation.
EXCUSED: Jean Conway, Dorothy Chase
ABSENT: James D'Errico
Mr. Clinton stated that we have over 13 . 6 million in assets at
this time.
Mr. Shavers distributed handouts to commission members consisting
of graphs and statements showing a summary of investments on the
PLUS Fund and U. S. Treasury Securities.
Mr. Shavers noted the following figures:
PLUS Fund $6, 580, 000
U. S. Treasury Securities 5, 850, 000
Cash 525, 000
CG Guaranteed 525, 000
Short Term Account 237 , 000
Mr. Clinton noted that the Treasury Fund has been a bit
disappointing this year.
Mr. Shavers stated that interest rates could increase from now to
year end and feels that a reallocation of monies to the PLUS Fund
would be a wise decision.
Mr. Shavers further stated that with the U. S. Treasury Securities
there is a 4 year maturity with zero credit risk, however there
is an increase in market value risk. The opposite is true for
the PLUS Fund.
Mr. Clinton said that it appears to be in our best interest to
move all monies to the PLUS Fund.
Ms. Benjamin asked if there were any other funds we could invest
in?
Mr. Shavers stated that there are many, however all are higher
risk funds.
Mr. Shavers further stated that interest rates are in a cyclical
decline. A good rule of thumb is to figure a 4 . 5% loss a year on
Treasury Bills. So if we kept 6 million in the Treasury Bills,
there would be an estimated $100, 000 net loss. If we kept 6. 5
million in the Guaranteed Plus, we would earn approximately 7%
interest on that or $210, 000 per a 6 month basis.
Mr. Clinton stated that the best choice to make at this point
would be to move the Treasury Bills to the Guaranteed Plus Fund
to essentially double our income from now to December 1996 with
no risk of interest loss.
Mr. Shavers stated that to change allocation to the Plus Fund
would roughly give us a $400, 000 income by year end. This would
consist of transferring all the Treasury Securities to the PLUS
Fund. If we keep 50% in Treasury and 50% in the PLUS Fund we
would net $110, 000. (A revised estimate was sent the next day -
see Appendix A, attached) .
Mr. Chirico made a motion to transfer Treasury Securities to the
Guaranteed Plus Fund, and transfer the $815, 000 Pension
Contributions to be obtained on July 1, 1996 into the Employee
Retirement Investment Fund. Seconded by Ms. Benjamin. All in
favor. Motion carried.
The next meeting of the Pension Investment Committee will meet on
December 3 , 1996 at 2 : 30 p.m.
ADJOURNMENT
A motion was made by Ms. Benjamin to adjourn the meeting at 3 : 56
p.m. Seconded by Mr. Chaznowski. All in favor. Motion carried.
Sincerely,
Ina M. DeGrand
Recording Secretary
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06/14/96 14:54 TX/RX NO.3268 P.002 •