Board of Trustees - IN PERSON ONLY!
Detroit Police and Fire Retirement System
Finance
Thursday, Dec. 5, 2024
9:00 a.m. — 11:00 a.m. EST
500 Woodward Ave Detroit 48226 (Directions)
Suite 3000 (30th Floor)
Please review this Pension Board Resource Guide for explanations of terms and discussions you may encounter on this assignment!
Check the source website for additional information
Reporting
Edited and summarized by the Detroit - MI Documenters Team
Live reporting by
Perry Sylvester
The pension fund is currently $45 million over the allocation target — a surplus — but distributions should be increasing in the coming year. HR is filling vacancies created after a series of fraudulent pension payments were discovered. Michigan State Police is investigating.
The meeting is held at the offices of the Police & Fire Retirement System, Ally Center, 500 Woodward Avenue, Suite 3000...I'm looking forward to seeing the city looking all Christmasish 🙂🎅❄️
Official notice of this public meeting is found under the 'News' tab of the Retirement System of the City of Detroit's website...kinda lame offering for an 'e-newsletter', but here it is 👇📄🔗 rscd.org/pfrs_news_deta…
rscd.org/pfrs_news_deta…
Apparently this will be the last meeting of the year...the December 19 meeting is already listed as CANCELLED
Seems to be a semi-tradition of passing on some of the late December/early January meetings...meetings for 12/23 of last year and 1/4 of this year were also cancelled. Ho-ho-ho
Now, if you think you are going to get an agenda for this meeting, well, heh-heh, I'm afraid that most likely won't be happening until the day of the meeting. Looks like PFRS stopped posting the agendas online June of 2023
October 3 was the last time @DetDocumenters covered this meeting...live reporting was done by Benjamin Haddix @BhxDetroit and you can check out the thread here https://x.com/BhxDetroit/status/1841880069033295998
@DetDocumenters @BhxDetroit And notes were done by Shiva Sharma @shshdoc & you can check them out here 👇🔗 docs.google.com/document/d/1OT…
docs.google.com/document/d/1OT…
@DetDocumenters @BhxDetroit @shshdoc @shshdoc noted during her coverage that there was a lot of talk about HR 82…since that time it has passed in the House👇🔗 iaff.org/news/house-pas…
iaff.org/news/house-pas…
@DetDocumenters @BhxDetroit @shshdoc Something I did not see in our October coverage was follow up on the MSP investigation of suspected theft rom the pension from a (former) PFRS employee, as reported by media partner @freep 👇🔗🗞️ freep.com/story/money/pe…
freep.com/story/money/pe…
@DetDocumenters @BhxDetroit @shshdoc @freep #DETdocumenters we are starting…taking roll call at 9:02
@DetDocumenters @BhxDetroit @shshdoc @freep Going through the usual…approval of agenda, retirement acceptance, acceptance of receipts, etc…
@DetDocumenters @BhxDetroit @shshdoc @freep Kelly Tapper giving Executive Report…reports on VOYA values for DROP (check 9:06 in transcript for #)
@DetDocumenters @BhxDetroit @shshdoc @freep Discussion of Memorandum of Understanding (MOU)…City of Detroit has signed off on this, but not sure of specifics…they are for public safety unions
@DetDocumenters @BhxDetroit @shshdoc @freep Discussion now about the 13th check…$10million is already budgeted, $5 million for PFRS & $5 million for GRSD…this has to be done with actuarial cost study & approval of bankruptcy court…payment won’t occur until March
@DetDocumenters @BhxDetroit @shshdoc @freep Executive Director…some discussion about communication of upcoming retirees…timing is such that they should ideally wait until all the MOUs & CB agreement modifications have been approved
@DetDocumenters @BhxDetroit @shshdoc @freep Also just learned that the Jan 2 meeting will also be canceled 😲☹️
@DetDocumenters @BhxDetroit @shshdoc @freep Now some talk about new hires in payroll and cryptic reference to ‘that situation’ which crated a vacancy…Tapper says that the forensic investigation is underway. Assume this is about the MSP investigation of possible theft from the fund👇🔗🗞️ detroitnews.com/story/news/loc…
detroitnews.com/story/news/loc…
@DetDocumenters @BhxDetroit @shshdoc @freep Bruce Babiarz, Public Affairs, has nothing to report & states that there are no media inquiries…which I find disappointing
@DetDocumenters @BhxDetroit @shshdoc @freep Now shifting to discussion of HR 82 and how current Social Security rules severely impact public workers with pension … arcane rules that create a clawback of Social Security earnings for those workers…originate from the Reagan years ago
@DetDocumenters @BhxDetroit @shshdoc @freep Discussion about mounting a more public campaign to support passage in the Senate, connect with media, craft editorial statements
@DetDocumenters @BhxDetroit @shshdoc @freep New pension manager reports on the fund performance and market climate…all positive, especially growth equities. Nots decrease in volatility following election…moving forward sees adjustments to asset allocation as less decisive than paying close attention to fund managers
@DetDocumenters @BhxDetroit @shshdoc @freep Notes via investment climate dashboard that consumer sentiment has improved since September and dollar remains strong
@DetDocumenters @BhxDetroit @shshdoc @freep Acknowledges that tariffs, trade wars and unorthodox policies from Administration all possible threats and major reason why active management funds should be important
@DetDocumenters @BhxDetroit @shshdoc @freep It is noted that pension fund holdings close to being overvalued (in terms of P/E) but they are very diversified…the fund’s benchmark is not based on S&P but rather a diversified benchmark…likely they will move away from large cap growth and into small cap value holdings
@DetDocumenters @BhxDetroit @shshdoc @freep Now a return to long standing discussions about private equity, private credit & real estate allocations…questions about the performance and expectations. Answer is their has been strong returns but no plans to increase exposure levels
@DetDocumenters @BhxDetroit @shshdoc @freep The fund is currently $45 million over the allocation target but distributions should be increasing in coming year…trend in market in increase in high worth investors moving aggressively into private credit, which is positive for the portfolio
@DetDocumenters @BhxDetroit @shshdoc @freep Now time for legal report…and quick not we may go to closed session
@DetDocumenters @BhxDetroit @shshdoc @freep We have a presentation coming…with reference to (soon to be FOIA’d) documents in the Magic Packet ™️🧙🏻♂️🎩🐰
@DetDocumenters @BhxDetroit @shshdoc @freep They bequeath an ‘Unmodified Opinion’…the Holy Grail saying, yah, your statements are correct
@DetDocumenters @BhxDetroit @shshdoc @freep Contributions and investments both are up🙌🏼…$72 million added to the plan
@DetDocumenters @BhxDetroit @shshdoc @freep Discussion how for 1st 10 years of bankruptcy there was a dynamic in which excess funds were transferred into the rate stabilization fund & pension stabilization (?)….now the excess will stay in pension accumulation fund, shown in the reserves/component 2…gotta ✅ footnotes
@DetDocumenters @BhxDetroit @shshdoc @freep Here is slide displaying pension liabilities in the 2 funds…variations largely due to investment performance…goal is to get to 100% funding level, ideally before end of 30 year amortization with city
@DetDocumenters @BhxDetroit @shshdoc @freep Continued emphasis hat NPL, net pension liability, highly dependent on market returns…this is very clear when looking at trend over time
@DetDocumenters @BhxDetroit @shshdoc @freep The NPL is picked up by City of Detroit which acts as plan sponsor…some talk (thinking out loud) about possibly combining 2 components 😲
@DetDocumenters @BhxDetroit @shshdoc @freep Material Weaknesses: 1. Census Data 2. Controls over IT processes Check around 10 AM in the transcript for the details
@DetDocumenters @BhxDetroit @shshdoc @freep Tapper says she is open to hearing about what other systems have done
@DetDocumenters @BhxDetroit @shshdoc @freep Significant Deficiency is essentially city recording of contributions issue… $3.7 million not reported (although funds all there…again, a reporting issue)
@DetDocumenters @BhxDetroit @shshdoc @freep Some recommendations from the audit team…communication is the key 🧐
@DetDocumenters @BhxDetroit @shshdoc @freep ✅NOTE—it would be interesting to see which (if any) of these are implemented
@DetDocumenters @BhxDetroit @shshdoc @freep They approve the audit unanimously … acknowledge the staff accountants who are present
@DetDocumenters @BhxDetroit @shshdoc @freep Now we are at legal report (for real this time)…they have draft of financials & forms that are submitted to State Treasurer; it is noted they are supposed to get a statement letter back but never have
@DetDocumenters @BhxDetroit @shshdoc @freep So 10:20ish and we are closed session purgatory … they say they will just adjourn afterwards
@DetDocumenters @BhxDetroit @shshdoc @freep So that is a wrap…check the transcript for hints about the closed session results…going into it, we were told it had something to do with request from the Office of the Inspector General plus something in which disability was a factor
@DetDocumenters @BhxDetroit @shshdoc @freep If anything in this reporting appears incorrect to you, email documenters@outlier_media.org with ‘Correction Request’ in the subject line
@DetDocumenters @BhxDetroit @shshdoc @freep As always, go to for more content & coverage Documenters.org
Documenters.org
Agency Information
Detroit Police and Fire Retirement System
The Police & Fire Retirement System of the City of Detroit helps Detroit families meet the economic challenges of retirement, disability or death.
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