The URL can be used to link to this page

279610 WMITE - C�TV CLERK COUIICII ��J■��■■ PINK - FINANCE G I TY OF SA I NT PAU L CANARV - DEPARTMENT BLUE - MAVOR ° � � File N 0. Council Resolution Presented By � �L Referred To Committee: Date Out of Committee By Date RESOLUTION DIRECTING DISCONTINUANCE OF PENSION CONTRIBUTIONS UNDER GROUP ANNUITY CONTRACT WITH MUTUAL BENEFIT LIFE INSURANCE COMPANY AND AUTHORIZING INTERIM INVESTMENT OF PENSION CONTRIBUTIONS AND OTHER ACTION RESOLVED, by the Council of the City of Saint Paul, a partici- pating employer under Group Annuity Contract No. GA-1052 (Contract) between the Mutual Benefit Life Insurance Company (Company) and the HRACSPM dated January 1, 1974, and an associate em loyer under the Pension Plan, that in accordance with Section G1(a� of said Contract, contributions are discontinued effective January 1, 1983, by written notification to the Company to be ma.de forthwith; RESOLVED FURTHER, that the Pension Plan Committee is authorized to receive and invest contributions made by the City and its participating employees in each pay period after December 31, 1982, pursuant to the Plan, to seek approval of the United States of America Department of Housing and Urban Development to the transfer of the value of the Pension Fund accumulation accounts to Investment Advisors, Inc. , to prepare documents effecting such transfer for further City Council review and approval, and to take all other action necessary or convenient to carry out this resolution. COUNCILMEN Requested by Department of: Yeas Nays � Fle�� Masanz In Favor Nicosia scneibei _ __ Against BY — TedesCo Wilson DEC 2 3 1981 Form Approved by City Atto ney Adopted by Council: Date Certified assed unc' Secretary BY B� �, .. ,, � �_, �-_ �(Lc�'�d �� •(,Gfi(GiY �1pp by ;Navor. t � _ DEC 2 g ig82 Approved b r for Su iss' t ouncil By, _ By � PUBLlSHED D E C 3 � 1982 � � ' • � � d �.l��.V December 9 , 1982 � T0: Commissioners , Members , Public Housing Agency of the Saint Paul City Council City of Saint Paul Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul , Minnesota FROM: Pension Committee RE: HRA Pension Plan; Pension Fund Investment Proposal - The defined contribution, employee contributing private pension plan adopted by the Housing. and Redevelopment Authority of the City of Saint Paul, Minnesota (HR.A) for its employees * remains in effect for 158 employees of the Public Housing Agency, 56 City of Saint Paul employees transferred from HR.A and for 36 former employees . The Pension Plan is administered by a Committee composed of an Agency Board appointee, a City Council appointee, and three employee representatives . The Pension Fund, which is the aggregate of employer and employee contributions and investment earnings thereon credited to Participants accounts,�* presently totals $5, 000, 000 . The Pension Fund is deposited for investment with Mutual Benefit Life Insurance Company (MBL) under a deposit administration Group Annuity Contract. '� HRA employees are excluded from PERA coverage . Minn. Stat. §353 . 01 Subd. 6 . '�`� Participant account value at retirement constitutes the participants retirement benefit through retire- ment annuity purchase or other benefit option. / � . � � �"�g6�� Page 'I�ao For the reasons set forth in the attached Investment Proposal , ' the Pension Co�ittee proposes to discontinue current contribu- tions to MBL as early as practicable in 1983 , to withdraw Pension Fund past contributions from MBL on a 33 month basis ,� and to invest these monies to the Participants account in "no - load" stock, bond and money market mutual funds administered by Investment Advisors , Inc . , (IAI) of Minneapolis . The Investment Proposal was presented to the employee Participants at meetings on November 22, 1982 . On December 7, Participants ballots were tallied. From 250 active and inactive participants , 171 ballots (68 . 4%) were received. Of these, 154 (61 . 6P/o) voted in favor and 17 (6 . 8%) voted against the Proposal . 79 Partici- pants (31 . 6%) did not submit a ballot . The Investment Proposal change was favored by a 9 to 1 pluralty . Adoption of the enclosed resolution authorizing suspension of contributions to MBL, solicitation of HUD approval of the investment transfer of the Pension Fund to IAI mutual funds , and preparation of necessary documents to effect the transfer to be submitted for your subsequent consideration, is requested. Encs . '� a lump sum withdrawal would permit MBL to reduce the Pension Fund by a market value adjustment under terms of the Group Annuity Contract . . ' � I�� PENSION FUND INVESTMENT PROPOSAL The Pension Committee, after more than three years study, in consultation with Meidinger and Associates and the Martin E. Segal Company, is recommending a new . investment vehicle for the Pension F�d. This Proposal involves no change in the � Pension Plan, noc in any aspect af employer contributions, five-year vesting, transferability or other employee right or benefit. The Committee's Proposal is cather to withdraw the Pension Fund from Mutual Benefit Life Insurance Company of Newark in equal monthly installments over a 33- month period, and to deposit current contributions, the PERA tcansferred accounts and the monthly withdrawal installments with Investment Advisors, Inc.,of Minneapolis for investment (consistent with HUD investment requirements)* in North Star Stock Fund, � North Star Regional Fund, North Star Bond Fund or the IAI Principal Protection Fund. See Investment Options, Attachment 1. Investment Advisors, Inc. was formed in i947 and is headquactered in Minneapolis. Investment Advisors, Inc. {IAI) is a wholly-owned subsidiacy of Inter- Regional Financial Group in which Dain Bosworth, Incorporated is also a member. IAI manages auets of $900 �illion in over 100 profit sharing, pension, endowment and foundation accounts. See attachment 2**. *HUD restricts equity (stock) investment to the amount of the employer contribution. The empioyee contribution is limited to fixed income investment. **Listing of area Corporate, Public, and Foundation and Endowment Clients of Investment Advisors, Inc. _ 2 _ The Committe's experience with investment management by an insurance company and study of bank and corporate trustee pension investment struct�res . suggested that investment management performance by such firms, engaged in another primacy business activity, was less likely to match that of a firm speciaiizing in investment management and counseling. With consultant advise and selection • criterian including requirement of a Twin Cities office, the Committee chose IAI as investment advisor nominee from qualified candidates after review of quatifications and investment philosophy, interview of key personnel, and performance evaluation. This Investment Proposal is recommended to the Plan Participants on the basis of 1) return on investment, 2) investment flexibility, 3) cost of administration and 4) principal protection. Investment Return. The five year flerformance Comparison and Dollac Growth charts (Attachments 3 and 4) indicate that Mutual Benefit Life (MBL) investment return has lagged behind the Consumer Price Index and was significa�tly less than return experienced by IAI composite equity and fixed income funds. This return disparity is more apparent if the comparision is made to MBL Adjusted Return which is the Reported Return, i.e. interest guarantee percent, adjusted .596 of 19b interest guarantee subsidy* and further adjusted to reflect MBL accounting procedure which computes all expenses as though incurred on January 1 of each year and computes all current contributions as though received on . December 31st.�� *Subsidy from forfeited employer contributions and the Fund contingency reserve. **No interest is paid on current contributions whether deposited in �anuary or December. MBL's guaranteed interest return for a current year is computed on the amount of the Participants accounts at the end of the previous year. . .. - � : � ��ss:�� - 3 - � In the Performance Comparison Attachment, both MBL and IAI fixed income ret�rns are compared without cost or market value adjustment* because the Pension Fund will not be cost adjusted with the installment withdrawal proposed. Such adjustment, however, further emphasizes equity growth potential, which probably will be stronger over the decade of the 1980s than in the 1970s. Presently only nine Participants have investment in the MBL Variable Account in amount of $50,680. The Committee believes that IAI's investment counseling service and proximity will prove of significant benefit to the Plan by encouraging greater equity investment participation. Investment Flexibility. Neither the Committee nor Participants have input into the make up of MBL's fixed account investment portfolio. MBL's variable (equity) account provides the only investment option to Pazticipant. The variable account may be increased or decreased at a Participant's option on a semi-annual basis. MBL discloses the variable account investment portfolio on a quarterly basis, but provides no investment counseling. IAI will provide two equity, one fixed income and one money mazket fund investment alternatives. Within HUD's limitations, and with the benefit of investment counseling from IAI, Participants will have four investment options, and the ability to move funds on a quarterly basis in response to changing investment opportunities. The Committee is impressed with IAI's monitoring and investment management analysis and evaluation process. IAI's proximity will permit Participants to be in receipt of up to date information and timely counseling respecting investment options. *Bonds are subject to discount when sold before maturity. Bond cost or market value is the discounted price produced by a sale. If held to maturity, bond face value plus . earned interest would be realized. However, in computing present value and investment return the cost adjustment is calculated. Cost adjusted, MBL's five year average Reported Return would be reduced from 9.5%�to 4.929i6 (48.2%) and IAI's from 10.5� to 5.9% (43.8%). - 4 - Cost of Administration. MBL's seven-year average annual cost of administering the Pension Plan is $34,180.56. IAI's annual investment fee would be $27,069.83� based on a $4,607,437 Pension Fund. The annual cost of Participant account record keeping and semi-annual** reporting will be $4,482, and fiduciary insurance premium of $1,500 would bring total cost of administration with IAI to $33,051.83. • Administrative Cost schedule, Attachment 5. In commencing its study of an alternate investment vehicle for the Pension Fund, the Committee assumed both a higher level of investment return and a higher level of cost of administration. The level of investment return in IAI Hybrid would have been 1.99i6 higher annually than MBL Reported Return and 3.49�6 higher than MBL Adjusted Return based on the five year average, 1977-1981, Attachment 3. The cost of administration, however, would be substantially comparible with IAI providing investment counseling service not provided by MBL. Principal Protection. IAI's investment Funds are "no load" mutual funds. Investment of the Pension Fund in the IAI Funds will result in purchase of IAI Fund shares which would t,hen represent the complete investment. Participants' accounts would hold IAI Fund shares in amount of their cash value at time of purchase, and would appreciate or depreciate with change in the value of Fund assets reflected in the market value of Fund shares. *The investment fee figure will increase each year with growth of the Pension Fund. *�The North Star Funds are reported weekly in the Dispatch/Pioneer Press financial page. . � •• . ' • _ 5 _ � d�� MBL's Group Annuity Contract provides no Fund or Participant ownership of the assets in which the Fixed Income Account is invested or in MBL which is not a stock company. Rather MBL has a contract obligation to pay the market value of the Fund investment upon a lump sum withdrawal, or to pay the cash value of the Fund upon a 33 month installment withdrawal.* The value of this contract commitment, of course, is dependent upon MBL's company-wide investment management performance and , overall financial condition.*� In today's circumstances, the Committee believes that the principal protection of the Pension Fund will be better served by the opportunity for Participants to make i�formed decisions respecting investment of their accounts so as to produce best growth or return according to changing market conditions. Under this Investment Proposal, the Pension Committee would become the Trustee of the Pension Plan under a trust agreement. Under the trust agreement the Trustees would be charged with the responsibilty for the investment of the Pension Fund. The Committee proposes to obtain fiduciary insurance at an estimated annual cost of $1,000 to $1,500 as protection to Pacticipants that the Committee's fiduciazy duties will be properly prerformed. �The Martin E. Segal Company advises that during the withdrawal period, interest - rates would be calculated by MBL on the last in, first out basis with higher interest returns occurring with last in portfolio purchases. Effective interest rates for the period 1975-1978 range from 6.75% to 8%. The Variable Account is represented by unit shares. ��MBL reported a 48.2% market value adjustment to the Pension Fund as of 12/31/81 in event of lump sum withdrawal. This figure exceeds the 1977-1981 aggregate of MBL Reported Return (47.696). MBL estimates a 30% market value adjustment on ` 11/5/82. - 6 - Under this Proposal group life insurance to provide 1.5 times annual salary minimum death benefit (including Participant's account value) would be continued on a bid basis with premium payable from employer contribution of the covered Participants as is the present case. Annuity purchase retiremeht option also will remain available to Participants. ' Copies of Investment Advisors, Inc., brochure and the Martin E. Segal Company report are available for inspection at the. PHA Central Office (Ken Hansen), City Hall (7im Hart), City Hall Annex (Corrine Haas) and 1010 University Avenue (Dick Simon). Committe members and representatives of Investment Advisors, Inc., and the Martin E. Segal Company will be available to answer your questions during the meetings scheduled for November 22, 1982. Your attendance at these meetings is requested and encouraged. In the event o� Participants' approval of Committee's Investment Proposal, the proposal would be submitted for approval by the Employer Boards and HUD prior to its implementation. . The Pension Committee November 18, 1982 . � -� . � � � Attachment 1 ��s�� INVESTMENT OPT�ONS 1. North Star Stock Fund -- The primary investment objective of the Stock Fund is capital appreciation, with income being secondary objective. The purpose of the Stock Fund is to provide shareholders with a diversified portfolio of securities which appear to offer the greatest possibilities for long term capital appreciation. As its name implies, th.e Stock Fund is an equity fund but it may also invest in cash equivalents when InVestment Advisers, �Inc. believes it is appropriate. 2. North Star Bond Fund -- The investment qbjectives of the Band Fund are to provide a high level of current income consistent wi.th preservation of capital . As with the Stock Fund, the Bond Fund providss a diversified pprt- folio of securities. This is a fixed income investment alternative and should not be subject to the volatility of an equity fund. 3. North Star Regional Fund -- The investment objective of the Regional Fund is capital appreciation. This is a more aggressive equity fund than the Stock Fund. This fund will invest at leas.t 80q of its equity investments in companies headquartered in Minnesota, Wisconsin, Iowa, Nebraska, Montana, P�orth Dakota or South Dakota. These typically are smaller companies with little or no dividend income but which have the potential for substantial capital appreciation. As with the Stock Fund, when Investment AdVi.sers believes i.t is appropriate, the Regional Fund may temporarily invest a portion of i.ts assets in short term cash equivalents. � 4. Principal Protection Fund -- This option involves investing in a money market fund or short term government securities with maturi.ties of less than one year which means there will be virtually no risk of market depreciation. Yields • on the money market funds fluctuate with the general level of interest rates. Current yields on short term money market funds are between 10% and 11�. This investment option should be selected by the participant wh.o wants virtually no downside risk for their share of the retirement plan. ' �:'_: ' .. Attachment : .�=_ • � INVE5TMENT ADVISERS, INC. Re�istere� investment advisor s: nce 19��7 . 1�ianages $900 million in assets . Mana�es m�ney f�r pr�fit sharing , pension, endowmen*_s , an� founda�i�n accounts . zieadquartered in Diinneapol is . 11 investment professionals with over 180 years of experience in managing assets . Whollv-�wned stibsidiary of Inter Regional Financial Gr�up (IFG) . Group process . C�rporate objectives of firm. . . � . �'�96�_�U � Attachment 2 C LI ENTS Corporate American H�ist & Derrick Car�ill Cenex Conwe-1 Corporation Cra�� Research Dai r�:-men Inc . SE Da��t�n Huds�n Dubuque Packing Eastman Kodak Economic Laborat�ries Emerson Electric Gelco Graco Halcon Intl Health Central Henkel Chemical � Hon Industries Household Internatianal Joint Venture : NL Industries & Alleghany Lu-ilum: Titaneous lietals C�rp of America '.41e�ltronic � r,iinneapolis Star & Tribune � Minnesota '.'�edical Assoc. �iinnesota �iinin� & Manufacturing Northern States Power Northwest Airlines Otter Tail Power & Light Pavless Cashways Pentair Pioneer Hi-bre�i Internatit�nal � R.epublic Airlines Soo Line Railroa�i Toro Corporation Van Dusen Air �Yinnebag� In�ustries C....-:. �. - Attachment 2 . - CLIENT5 Pub] ic Funds Cit�t �f Water]oo Fire & Police Citv �f Sioux Falls :14inneapolis Fire Department R�e1 ief Assoc . '.Kinneapo:is Employees Retirement Fund '.Iinneapol is Po7 i-ce Relief Assoc. State of New Hampshire St . Paul Police . � : . � - . � . �`�gs�� Attachment 2 � CLIENTS Ead�wments & Foundati.ons Car;ill Foiin�ation Luther College Christian 8r�thars Onan Foundation C�ncord i a Co]le;*e Pi.11sbury Founr3 a�ion Na7lmark Foun��lat ion S± . Olaf C�llege Howard Universit� Stewards Fr�undation T.ara�on F��n�lation University of .iinnesota Universitv of North Dako�a �n.�owment L�itheran Church • 9iissouri Syno� (Pension Retirement Plan) ♦ � Attachment 3 ' ;:=,�, . .' �� Performance Comparison 5 year �� 1977 1978 1979 1980 1981 avera e IAI Equities 3Z'1 3fl•' 3.3 9.2 15.8 31.0 2.1 12.3 MBL Variable L�•O i�.3 .6 8.5 7.3 17.6 5.9 8.0 IAI Fixed Income 8.0 8.7 9.6 12.0 14.2 10.5 IAI Hybrid 5.7 9.0 12.7 21.5 8.2 11.4 Mutual Benefit Life Reported Return 8.5 9.25 9.6 9.75 10.5 9.5 Mutual Benefit Life Adjusted Return 7.3 7.7 8.0 7.9 9.1 8.0 CPI 6.4 7.7 13.3 12.4 8.9 9.7 Definitions IAI Equities - Money invested in the stock market. Stocks selected by IAI may include many well-known, high quality companies. Performance is net of any management expenses. IAI Fixed Income - Money invested in corporate or government bonds, and is adjusted to reflect cost value of bonds. Performance is new of any management expenses. IAI Hybrid - Combination of 50� equities and 50� fixed income. This combination is included because Mutual Benefit Life invests in both stocks and bonds and is an attempt to have a meaningful comparison. Performance is net of any management expenses. Mutual Benefit Life Reported Return - Interest earned on your account balance as of the beginning of each year. No adjustment has ' been made for expenses in cash flow during the year. Mutual Benefit Life Adjusted Return - Amount of money earned each year on the assets currently invested with Mutual Benefit Life. These numbers are adjusted .5� of 1$ per year to reflect non-forfeiture account subsidy and to reflect cash flow and expense incurred during the year. CPI - Consumer price index; used as an approximation for the rate of inflation each year. �uauiu��ti . . q-B�a� ,� �r C� �C 3Q n 9 7 - � N N � P� O � � � � � �i FS ^� 70 A� H � �-'• ;n N " A � � J � :* � � J µ � J 1.�� r� . �"'� r� � iE 9E P� C� .• � . � � � O N. C � N J � .i. ;11 O � - .G/� : c�r :3 U1 � �: :,7� � (X� :n q. � J �! � • '� -b C � 34 O cbD � c�D � K � � `* ►t �! 'i n ct {n � W `3 ~• W ,�p� (p CJi (D � � � n A n � 3a �r .. - 1-, C� A C� fA �ri� QD C'�+ � v .,�J ' 0 � � � * � � �� N � ct ct c+ p � W � w � � � g � � G � ►�• r• r• A� 'd , cr cr c+ t� A� W � ? ? � � � C cD � � A �1 �1 A� 3 � w N• .J �7 �l ... . . . . c�+ 1 Pl .i A� � '.�3 CJl CJ7 �1 O) � 'O O � � K C v`+i � a' .-�+� � o �-�e � a � : N � N� AJ F-+ r-+ �"'�' ►-, � � �p 'i' n M � 38 38 ►-' 3$ c'`� r' cD ►i r• n � O � 'tf �i ct � O w w O O O " '.� `J. O m () . G '.3' � p'y ''ti' O� H► � �� c.r cT p c�D e�+ '� t=i OR 7� pp U�Q � �P tA ►i ►i A� IA F+• � • • A� ct Ui :+< � Oq QJ '74 ir9 �7 t-+ � . (D W t�+� ''! �'i 7Q K 3� 'P �" u� a �+ c� cu K � � �e Ja ja c� � � � � m cD �+ � N C� � � (p �+ O N G� �d � � � �P tfl � �1 J ct � � � N• (p O �1 N tfl ll� � 0.7 Q'Z A .. . `J � �� o x � � �' � � v ►:. a ►� � � N � ►� �+ � �'' � C ¢, N - ' C� b � '_! � Y � ►i ►�. G t''' .. f"' � ~ �� c��+ p. < � Y N r-� ►-+ o0 � H N u, m c� � W o � � � N• � • • y �i �7 � C� cJ� c�► �* � �'* o � � � � � w ro � o o � cn �. - c � aQ c+ a. A C UI Oo G O N �D 4A Sy G O �D c�+ • • . � N � v� � w ►-� �• a � v� � � � �� W N '� NOOW K � � � * �70 � � .. F"' t7NU1 'C R° � � � � a � W O�C � � K � � �1 00 I'e' • • � � � � � ~. � � W C O cD m trJ �i �S � '�U' A � N � � 1-+ � �Ls ,'� �D cU OQ � N - W� N 4,/3 G � � � � W � �i �1 F�''� �1 O � � Cn A� � O C.�i �A p O� rp, Ui (D ►`-� O N � �(D � G'� . . . . . Attachment 4 Growth of a Dollar - 1977 1981 IAI Equit��es* 1.00 1 .75 I�I Fixed* 1.00 1 .��** .50/50 Stock�Bon� Hvbrid* 1.00 1 .70 � �iur.•iai 3enefit Life Reporte,� Ret�irn 1.00 1 .�$ .iu�.�aal 3�nef: * Life A:;;u�ted Return 1 .00 � .4?*** ConsumQr Price In�ex �•00 1 •�� * These numbers are net after expenses ** Ad.jus •".ed to ref lect cost value of bonds *** Ad�usted .5� of 1� per year to reflect nonforieiture account subsi�ly and cash flow and expenses . . ' I` ° ' . .�'w. � . �96�� St. Paul HRA/PHA Pension Plan Participant Ballot � Move to a Investment Manager Structure with Investment Advisers, Inc. Remain in a Deposit Administration Plan with Mutual a Benefit Life Print NAME Signature ' '., y _ �d� J��1f RESOLUTION N0 . 82-12/15- RESOLUTION DIRECTING DISCONTINUANCE OF PENSION CONTRIBUTIONS UNDER GROUP ANNUITY CONTRACT WITH THE MUTUAL BENEFIT LIFE INSURANCE COMPANY AND AUTHORIZING INTERIM INVESTMENT OF PENSION CONTRIBUTIONS RESOLVED by the Board of Commissioners of the Public Housing Agency of the City of Saint Paul , a participating employer under Group Annuity Contract No . GA-1052 (Contract) between The Mutual Benefit Life Insurance Company (Company) and the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (HRA) dated January 1, 1974, and an associate employer under the Pension Plan of said HRA (Plan) , that in accordance with Section G1(a) of said Contract contributions are discontinued effective January l , 1983, by written notification to the Company to be made forthwith. RESOLVED FURTHER that the Pension Plan Committee is author- ized to receive and invest contributions made by the Agency and its employees in each pay period after December 31 , 1982, to seek approval of the United States of America Department of Housing and Urban Developrnent to the transfer of the value of the Pension Fund accumulation accounts to another funding agency, to prepare documents effecting such transfer for further Agency review and approval , and to take all other action necessary or convenient to carry out this resolution. ' � � ' CITX OF SAINT P.E�.Y3L "�� /O �: _ H 1' �%� �� OFFICE OF TFLF CITY COIIIti'CIL �_" :,,,,.:, �+,;. . � .ss',ssw�)•r` � • �,, '-'_'_'�' �d t e % December 16, 1982 �r� - _ COMMi�'TEE RE Pn �T TO = �q�nt Pau i City Cou�cit ��Q � = COMI�'�?Ii'�'�� Oh Finance, Mgmt. �, Personnel . � C�L�(R Jim Scheibel - I. Approval of. minutes from meeting held December 9, 1982� �QF(ZQ�� 3-� � — 2. 198�' Bond Sale (Finance Dept.) �Q��g,p 3-0 3. Resolut uthorizing additions to the 1982 Equipment Services Fire � Police � Buc�get.•. e Department) l<P�nD OV� ► WEE,�C � � . 4. Resolutio thorizing an Agreenent between the City of St. Paul arid the U of M whereby the will provide an instructor tv teach in the U of ?f's Division of School Heal cation. (Health Dept.) C.Pct-� pV� t W�f.�C . �-- S. Resolution �authorizing the Port Authority to sell industrial development revenu� -- bonds for the Broadway Square project at Fifth F� Broadway. Sts. (Port Authority).��%v� � 3-0 6. Resolution authoaizing the Dept. of Finance �, P1gmt. Services to pay the Assn. of rletropolitan Municipalities and the League of 1!linnesota Cities for memberships. (Finance Dept.) ptPPRQUfc>C� �3-U 7. Resolution authorizing the Minnesota rlutual Life Insurance Co. to make payments to employees of the City for dividends earned throuoh the Group Ilealth Insurance policy. (Personnel) APFRv�� 3-0• � � 8. Resolution amending the Civil Service Rules for employees in the Fire F, Police Groups to insure that aIl in these groups live within areas from which they can report to duty in a timely manner. (Personnel) A�P{�tj�?`c-A 3-0 . , . 9. Reso 'on revising the fee schedule for emergency medical services, a fee � for fa larms caused by malfunctioning electronic fire surveillance equipment, a fee structur� for certain fire prevention inspection services. ( � Dept.) C.,f�rt p OV� ( �,t,)�� oh .a�c�uLu�f,Q_ �C� : I0. Resolution concerning a hof water District Heating System. i�'�0�� 3-d ll.��solution authorizing the investment of HRA Pension Plan contributions to be �� transferred from Mutual Benefit Life Insurance Co. to Investment Advisors, Inc.��{��D . 3-�5?w..... ..: ._. .__. .___., _�.,...:.,,�-:.,.� G.1't I ��'�'pfLN�+N DEPARTh1ENT a�9��0 •J�+M I��' CONTACT .�f-'�� PHONE reen �r � ' C. � 19 Q� DATE � (Routing and Explanation Sheet) Assign Number for Routing Or�r (Clip All Locations for Mayoral Signature): Department Director � City Attorney � Director of Management/Mayor Finance and Management Services Director �i City C1erk Budget Di rector _� �n„�1C!1.MAN ,�"�,iQ-1 h�E L What Will be Achieved by Taking Action on the Attached Materials? (Purpose/Rationale): !/r/l��STi1��'R�T" OF firi�-'r'4 Y�-T�/f/PL�9//?�' GO�t!7:�/dl/�DH`.� ��y �,�►� �� ,��f �- s� �,��,� .�.�.� .�c,ry .��v y��s) �liGG .�'�iJl�'�� X �Jt!l�Y.d�L dE�t/��=,�T �i`-E" �NS'd�?fC� GoH1,�i9!�Y� � ��t,��&�T�IEiYT 9iwi10�s,��. �:'�2 P�"a1'iOAI ca�lal�l7L�6 �ON9 M6 A�977aitJ �4A1A ��l�e5�3 � �`N•DO�.L6•ai�►E`� Financial , Budgetary and Personnel Impacts Anticipated: �Q�/�' Funding Source and Fund Activity Number Charged or Credited: �,�� Attachments (List and Number all Attachments) : /, �t?�utJON ?. �i�'si�V�/141�1"�` �e�Mfl�4NDV�y DEPARTMENT REVIEW CITY ATTORNEY REVIEW r' Yes No Council Resolution Required? Resolution Required? � Yes No Yes � No Insurance Required? Insurance Sufficient? � Yes No Yes No Insurance Attached? Revision of October, 1982 (See Reverse Side for 'instructions) nr►�� * O � Z��a � �Z � , ' ' -�. . � � � � �� ( '�� - � ' � � �� /� F �1�\ ' �A �I��H'�✓� 1 f V✓l � i Z3 � � . 4 1 'f� 1 V � f 4 k ! i � � , , ��ss�_� December 9, 1982 . ' TO: Cor�nis s ioners , Members , Public Housing Agency of the Saint Paul City Council City of Saint Paul Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul , Minnesota FROM: Pension Committee RE: HRA Pension Plan; . Pension Fund Investment Proposal The defined contribution, employee contributing private pension plan adovted by the Housing. and Redevelopment Authority of the � City of Saint Paul, Minnesota (HRA) for its employees * remains in effect for 158 employees of the Public Housing Agency, 5b City of Saint Paul employees transferred from HRA and for 36 former employees . The Pension Plan is administered by a Committee composed of an Agency Board .appointee, a City Council appointee, and three . employee representatives . The Pension Fund, which is the aggregate of employer and employee contributions and investment earnings thereon credited to Participants accounts,** presently totals $5, 000, 000 . The Pension Fund is deposited for investment with Mutual Benefit Life Insurance Company (MBL) under a deposit administration Group Annuity Contract. � HRA employees are excluded from PERA coverage. Minn. � Stat. §353 .01 Subd. 6 . �'� Participant account value at retirement constitutes the participants retirement benefit through retire- ment annuity purchase or other benefit option. �'�9��0 Page 'Ifao For the reasons set forth in the attached Investment Proposal , the Pension Committee proposes to discontinue current contribu- tions to MBL as early as practicable in 1983 , to withdraw Pension Fund past contributions from MBL on a 33 month basis ,* and to invest these monies to the Participants account in "no : load" stock, bond and money market mutual funds administered by Investment Advisors , Inc . , (IAI) of Minneapolis . The Investment Proposal was presented to the employee Participants at meetings on November 22, 1982 . On December 7 , Participants ballots were tallied. From 250 active and inactive participants , 171 ballots (68 .4%) were received. Of these, 154 (61 . 6%) voted in favor and 17 (6. 8%) voted against the Proposal . 79 Partici- pants (31 .6%) did not submit a ballot . The Investment Proposal change was favored by a 9 to 1 pluralty . Adoption of the enclosed resolution authorizing suspension of contributions to MBL, solicitation of HUD approval of the investment transfer of the Pension Fund to IAI mutual funds , and preparation of necessary documents to effect the transfer to be submitted for your subsequent consideration, is requested. Encs . '' a lump sum withdrawal would permit MBL to reduce the Pension Fund by a market value adjustment under terms o�� the Group Annuity Contract . . ��s�.� PENSION FUND INVESTMENT PROPOSAL The Pension Committee, aftec more than three years study, in consultation with Meidinger and Associates and the Martin E. Segal Company, is recommending a new investment vehicle for the Pension F�d. This Pcoposal involves no change in the � Pension Plan, no� in any aspect of e�nployer contributions, five-year vesting, transferability oc other employee cight or benefit. The Committee's Proposal 'ss rather to withdraw the Pension Fund from Mutual � Benefit Life Insurance Company of Newark in equal monthly installments over a 33- month period, and to deposit current contributions, the PERA transferred accounts and the monthly withdrawal installments with Investment P►dvisors, Inc., of Minneapolis f or investment (consistent with HUD investment requirements)* in North Star Stock Fund, North Star Regional Fund, North Star Bond Fund or the IAI Principal Protection Fund. See Investment Options, Attachment 1. Investment Advisors, Inc. was formed in 1947 and is headquarteced in Minneapolis. Investment Advisors, Inc. tIAI) is a wholly-owned subsidiary of Inter- Regional Financial Group in which Dain Bosworih, Incorpocated is also a member. IAI manages assets of $900 million in over I00 profit sharing, pension, endowment and foundation accounts. See attachment 2��. � *HUD restricts equity (stock) investment to the amount of the employer contribution. The employee contribution is limited to fixed income investment. +�*Listing of area Corporate, Public, and Foundation and Endowment Clients of Investment Advisors, Inc. _ 2 _ � The Committe's experience with investment management by an insurance company and study of bank and corporate trustee pension investment structures suggested that investment management performance by such firms, engaged in another primary business activity, was less likely to match that of a firm specializing in investment management and counseiing. With consultant advise and selection : criterian including cequirement of a Twin Cities office, the Committee chose IAI as investment advisor nominee from qualified candidates after review of qualifications and investment philosophy, interview of key personnel, and performance evaluation. This Investment Proposal is recommended to the Plan Participants on the basis of 1) return on investment, 2) investment flexibility, 3) cost of administration and 4) principal protection. Investment Return. The five year Performance Comparison and Dollar Growth charts (Attachments 3 and 4) indicate that Mutual Benefit Life (MBL) investment return has lagged behind the Consumer Price Tndex and was significantly less than return experienced by IAI composite equity and fixed income funds. This return disparity is more apparent if the comparision is made to MBL Adjusted Return which is the Reported Return, i.e. interest guarantee percent, adjusted .596 of 19i6 interest guarantee subsidy� and further adjusted to reflect MBL accounting proced�re which computes all expenses as though incurred on January 1 of each year and computes all current contributions as though received on . December 31st.�� . *Subsidy from forfeited employer contributions and the Fund contingency reserve. **No interest is paid on current contributions whether deposited in January or December. MBL's guaranteed interest return for a current year is computed on the amount of the Participants accounts at the end of the previous year. L � � - 3 - �� In the Performance Comparison Attachment, both MBL and IAI fixed income returns are compared without cost or market value adjustment* because the Pension _ Fund will not be cost adjusted with the installment withdrawal proposed. Such � adjustment, however, further emphasizes equity growth potential, which probabiy will be stronger over the decade of the 1980s than in the 1970s. Presently only nine Participants have investment in the MBL Variable Account in amount of $50,680. The Committee believes that IAI's investment counseling service and proximity will prove of significant benefit to the Plan by encouraging greater equity investment participation. Investrnent Flexibility. Neither the�Committee nor Parti�ipants have input into the make up of MBL's fixed account investment portfolio. MBL's variable (equity) account provides the only investment option to Pazticipant. The variable account may be increased or decreased at a Participant's option on a semi-annual basis. MBL discloses the variable account investment portfolio on a quarterly basis, but provides no investment counseling. IAI will provide two equity, one fixed income and one money market fund investment alternatives. Within HUD's limitations, and with the benefit of investment counseling from IAI, Participants will have four investment options, and the ability to move funds on a quarterly basis in response to changing investment opportunities. The Committee is impressed with IAI's monitoring and investment management analysis and evaluation pcocess. IAI's proximity will permit Participants to be in receipt of up to date information and timely counseling respecting investment options. *Bonds are subject to discount when sold before maturity. Bond cost or market value is the discounted price produced by a sale. If held to maturity, bond face value plus , earned interest would be realized. However, in computing present value and investment return the cost adjustment is calculated. Cost adjusted, MBL's five year average Reported Return would be reduced from 9.59b'to 4.92% (48.2%) and IAI's from 10.59�6 to 5.9% (43.8%). - 4 - Cost of Administration. MBL's seven-year average annual cost of administering the Pension Plan is $34,180.56. IAI's annuai investment fee would be $27,069.83* based on a $4,607,437 Pension Fund. The annual cost of Pacticipant account record keeping and semi-annual�* reporting will be $4,482, and fiduciary insurance premium of $1,500 would bring total cost of administration with IAI to $33,051.83. : Administrative Cost schedule, Attachment S. In commencing its study of an alternate investment vehicle for the Pension Fund, the Committee assumed both a higher level of investment return and a higher level of cost of administration. The level of invest�ment return in IAI Hybrid would have been 1.9% higher annually than MBL Reported Return and 3.496 higher than MBL Adjusted Return based on the five year average, 1977-1981, Attachment 3. The cost of administration, however, would be substantially comparible with IAI providing inve�tment counseling service not provided by MBL. Principal Protection. IAI's investment Funds are "no load" mutual funds. Investment of the Pension Fund in the IAI Funds will result in purchase of IAI Fund shares which would then represent the complete investment. Participants' accounts would hold IAI Fund shares in amount of their cash value at time of purchase, and would appreciate or depreciate with change in the value of Fund assets reflected in the market value of Fund shares. � *The investment fee figure will increase each year with growth of the Pension Fund. **The North Star Funds are reported weekly in the Dispatch/Pioneer Press financial Page• • � . • - 5 - MBL's Group Annuity Contract provides no Fund or Participant ownership of the assets in which the Fixed Income Account is invested or in MBL which is not a stock company. Rather MBL has a contract obligation to pay the market value of the Fund investment upon a lump sum withdrawal, or to pay the cash value of the Fund upon a � ' 33 month installment withdrawal.* The value of this contcact commitment, of course, is dependent upon MBL's company-wide investment management performance and overall financial condition.*� In today's circumstances, the Committee believes that the principal protection of the Pension Fund will be better served by the opportunity for Participants to make informed decisions respecting investment of their accounts so as to produce best growth or return according to changing market conditions. Under this Investment Proposal, the Pension Committee would become the Trustee of the Pension Plan under a trust agreement. Under the trust agreement the Trustees would be charged with the responsibilty for the investment of the Pension Fund. The Committee proposes to obtain fiduciary insurance at an estimated annual cost of $1,000 to $1,500 as protection to Participants that the Committee's fiduciary duties will be properly prerformed. � *The Martin E. Segal Company advises that during the withdrawal period, interest " rates would be calculated by MBL on the last in, first out basis with higher interest returns occurring with last in portfolio purchases. Effective interest rates for the period 1975-1978 range from 6.7596 to 85�5. The Variable Account is represented by unit shares. � �*MBL reported a 48.29� market value adjustment to the Pension Fund as of 12/31/81 in event of lump sum withdrawal. This figure exceeds the 1977-1981 aggregate of � MBL Reported Return (47.6%). MBL estimates a 30% market value adjustment on ` 11/Sf 82. . � ' : , - 6 - . Under this Proposal group life insurance to provide 1.5 times annual salary minimum death benefit (including Participant's account value) would be continued on a bid basis with premium payable from employec contribution of the covered , Participants as is the present case. Annuity purchase retiremeht option also will remain available to Participants. : Copies of Investment Advisors, Inc., brochure and the Martin E. Segal Company report are available for inspection at the. PHA Central Office (Ken Hansen), City Hall (Jim Hart), City Hall Annex (Corrine Haas) and 1010 University Avenue (Dick Simon). Committe members and representatives of Investment Advisors, Inc., and the Martin E. Segal Company will be available to answer your questions during the meetings scheduled for November 22, 1982. Your attendance at these meetings is requested and encouraged. In the event of Participants' approval of Committee's Investment Proposal, the proposal would be submitted for approval by the Employer Boards and HUD prior to its ' implementation. � . The Pension Committee November 18, 1982 � . � • � � Attachment 1 INVESTMENT OPTIONS 1. North Star Stock Fund -- The primary investment objective of the Stock Fund . is capital appreciation, with income being secondary objective. The purpose - - of the Stock Fund is to provide shareholders with a diversified portfolio of � securities which appear to offer the greatest possibilities for long term capital � appreciation. As its name implies, the Stock Fund is an equity fund but it may also invest in cash equi.valents when InYestment Advisers, �Inc. believes it is appropriate. . 2. North Star Bond Fund -- The i.nvestment objectives of the Bond Fund are to provide a high level of current income consistent wi.th preservation of capital . As with the Stock Fund, the Sond Fund provid�s a diversi.fied port- folio of securities. This is a fixed income investment alternative and should not be subject to the volatility of an equity fund. 3. North Star Regional Fund -- The investment objective of the Regional Fund is capital appreciation. This is a more aggressive equity fund than the Stock Fund. This fund wi�ll invest at leas.t 80� of its equity investments in companies headquartered in Minnesota, Wisconsin, Iowa, Nebraska, Montana, North Dakota or South Dakota. These typically are smaller companies with little or no dividend income but which have the potential for substantial capital appreciation. As with the Stock Fund, when Investment Advi.sers believes i.t is appropriate, the Regional Fund may temporarily inves.t. a portion of i.ts assets in short term cash equivalents. 4. Principal Protection Fund -- This option involves investing in a money market fund or short term government securities with maturi.ties of less than one year which means there will be virtually no risk of market depreciation. Yields • on the money market funds fluctuate wi.th the general level of interest rates. � Current yields on short term money market funds are between 10% and llro. This investment option shpuld be selected by the participant w.h.o wants virtually no downside risk for their share of the retirement plan. �� • ' • �� ,_ . �...;:. . Attachment : . �, . � ZNYESTMENT ADVISERS, INC. Registere� investment a3visor s: nce 19•�7 . lianages $900 million in assets . Mana�es m�ney for pr�fit sharing , pension , endowments , ' an�i founda�i�n accounts . ?ieadquartered in Diinneapol is . 11 investment professionals with over 180 years of experience in mana�ing assets . Whollv�=�wned stibsidiary of Inter Regional Financial Gr�up (IFG) . Group process . C�rporate ob,jectives of firm. . - ' � �~d J��1! • " ;:s. Attachment 2 . CLIENTS Public Funds City �f Waterloo Fire & Police Citv �f Sioux Falls liinneap�lis Fire Department Rel ief Assoc. �Iinneapo?is Employees Retirement Fund � '.iinneapol is P�7 3 ce Re lief Assoc. State �f New Hampshire St . Paul Police Attachmeat 2 � C LI ENTS Corporate . American H�ist & Derrick Cargill Cenex Conwe� Corporation Craj� Research Dair�;men Inc . SE Davt�n Huds�n , Dubuque Packing Eas tman Kod ak Economic Laborat�ries Emers�n Electric Ge lco Graco Halc�n Intl Health Central . Henke 1 Chemical Hon Industries Household International Joint Venture : NL Industries & Alle�hany Lu��ilum: Titaneous �ietals C�rp of America � 4ie�itronic t�iinneapoli s Star & Tribune � Minnesota 'dedical Assoc . tiinnesota 1•Iin�n� & Manufacturing . Northern States Power � Northwest Airlines Otter Tail Power & Li�ht Pavless Cashwat�s Pentair � . . Pioneer Hi-bre�i Internati�nal Republic Airlines Soo Line Railroa�i Toro Corporation Van Dusen Air � lYinnebago In�ustries . ��s�a Attachment 2 . . CLIENTS End�wments & Foundations Car;i 11 Foiin�at ion Luther College Christian 3r�t�ars Onan Foundation C�nc�rdia Co] lesT�: Pi.11sbury Founda�ion fia� lmark Foun.jation S*. . Olaf C�lleg� H�ward Universit� Stewards F�undation t.ara�-ion F��in�lation University of aiinnesota Universit,y �f North Dakota �n.iowment � I.!itheran Church • 5tissouri Syno� (Pension Retirement Plan) Attachment 3 � ' •. \::�'; . . � Performance Comparison 5 year �� 1977 1978 1979 1980 1981 avera e IAI Equities 3'�1 30•' 3.3 9.2 15.8 31.0 2.1 12.3 I�L Variable . L5-O (0.3 .6 8.5 7.3 17.6 5.9 8.0 IAI Fixed Income 8.0 8.7 9.6 12.0 14.2 10.5 IAI Hybrid 5.7 9.0 12.7 21.5 8.2 11.4 Mutual Benefit Life Reported Return 8.5 9.25 9.6 9.75 10.5 9.5 Mutual Benefit Life Adjusted Return 7.3 7.7 8.0 7.9 9.1 8.0 CPI 6.4 7.7 13.3 12.4 8.9 9.7 Definitions . � IAI Equities - Money invested in the stock market. Stocks selected by IAI may include . many well-known, high quality companies. Performance is net of any management expenses. IAI Fixed Income - Money invested in corporate or government bonds, and ,is adjusted to reflect cost value of bonds. Performance is new of any . management expenses. ZAI Hybrid - Combination of 50$ equities and 50$ fixed income. This combination is included because Mutual Benefit Life invests �in both stocks and bonds and is an attempt� to have a meaningful comparison. Performance is net of any management expenses. Mutual Benefit Life Reported Return - Interest earned on your account balance as of the beginning of each year. No adjustment has " been made for expenses in cash flow during the year. � Mutual Benefit Life Adjusted Return - Amount of money earned each year on the assets currently invested with Mutual Benefit Life. These numbers are adjusted .5$ of 1$ per year to reflect non-forfeiture account subsidy and to reflect cash flow and expense incurred during the year. CPI - Consumer price index; used as an approximation for the rate of inflation each year. � �uaiuu�E��I . . t�-s 33d . . . ��ss�� Attachment 4 Growth of a Dollar ' 1977 1951 IAI Equit`�es* 1.00 .1 .75 I�1I Fixed* 1.00 1 •��** a0/50 Stock 'Bon�i Hvbrid* 1.00 1 .70 ' titut•iai 3enefit Life Reporte��l Ret�trn 1 .00 1 •�8 .iu '.val 3�nef:.* LifQ A:;;usted R.eturn 1.00 ? .47*** ConsUmor Price In�ex 1.00 1.59 * These numbers are net after expenses ** Ad,ju.a!:ed to reflect cost value of bonds *** Ad�usted .5� of 1� per year to reflect nonforieiture account � subsi�lv and cash flow and expenses. c� � �' • . N � o m� ar � � - , . .��. � ~ •� K � K C ~ � y ►i . 7G P� � � � 'n N `� " A � � J � � • � 1.� � J }'�' � a � � � � �0 .,� . � * � n � il� � d O ►'' m N J � ']' � � UI � �3 :J� {,9 G �.�. . . N �. � ..� ►�U t�1 � W :11 f]. � � � � � O � 7 �- a � � �v �s v �• . � c� � c� � � � . ►sKK � �+ �+ W � w � � � � � � �a "' A f) A A� � c+ " � ~ A A A U1 * N 'n N w � � C .r. � * � v �� N �1 � H-+ C� ch ct c+ � � � W rp W � � � � G � N• N• w P� ''d '. . � ' c+ ct c+ ►-� 3n w � � � .� e�+ . Cn .. !-+ r• G cND � E n � � W 3 � r• W � � • . � �] �l rZ ... � rr 'O � � c11 c1t �•7 � • • � N Sy i-+ � � �D tD N W � � O ►-� � �"S C fl1 .+'�+ � � r'4 '„D,b 1-b � ¢ � �y 7� '1. � +fi -0 38 3S F'' aQ fA �. ' �i r O n � m �-S �'• n �,, ►�' ��,y � O H, � 3-+ �.. O m � n � � � � � � f.y � �] r► � � � !�l�1 � `G � 1P in � K A� R � � � � � . Q� Ua 'yQ "vq '�1 � . r � m � W �i : K 7Q ►i 3a < fD (D �S m � � � •.�� J9 "+R (9 GR C'� � � �Q � W � � m (p c+ tD N 1-� O . t31 • � N n' �d 0 � '�' � N �A. � '� �"* N tfl UI � i,�� j N. (D O �1 n w �. � N CT� . `d � M �.,. � p � � � � W�.y � � �'d' ' � ~ 'i ~ � . N � � A �.. � F,. � � ►]. � W .. ►� � Fi f1� � � C : I-�� H F-� C11 fD (D �1 W 0 � � � v � A ~' � • . • . ►� �J � �+ C� t� t� F�,, C 3 3.g c7 I 1 1 � ry A C N � 00 O � N � 4A A� G O cD c� • • • vti �ts W ►� �, p, ct V] � Cfl � '� W 3 N �A �•1 W N.3 � �E � � � I-+ F+. � ty c+ N Cfl C7 N CJ� cG R° R � a �• W 0� J 00 �' H `A � A ►�i . ' • � N �d �� '' ct ►�i K � ►�i k � � � �C 'd A cD n � N � . �a '� m N09 �• N .. C � , •W' N 4!3 C � ►.� m ct W � �A �1 �� p � Cn p c,,i �A O 0�. ,p cJ� cD . c.� O Go Q� O� �Q G� ►� O N �D . ' • ' � St. Paul HRA/PHA Pension Plan Participant Ballot Move to a Investment Manager Structure with Investment � � Advisers, Inc. Remain in a Deposit Administration Plari with Mutual � � � Benefit Life ' . Print NAME Signature � ,s' ,. � RESOLUTION NO . 82-12/15- RESOLUTION DIRECTING DISCONTINUANCE OF PENSION CONTRIBUTIONS UNDER GROUP ANNUITY CONTRACT WITH � THE MUTUAL BENEFIT LIFE INSUR.ANCE COMPANY AND . AUTHORIZING INTERIM INVESTMENT OF PENSION • CONTRIBUTIONS . RESOLVED by the Board of Commissioners of the Public Housing Agency of the City of Saint Paul, a participating employer under Group Annuity Contract No . GA-1052 (Contract) between The Mutual Benefit Life Insurance Company (Company) and the Housing and Redevelopment Authority of the C.ity of Saint Paul, Minnesota (HRA) dated January 1, 1974, and an associate employer under the Pension Plan of said HRA (Plan) , that in accordance with Section G1(a) of said Contract contributions are discontinued effective January 1 , 1983, by written notification to the Company to be � �made forthwith. RESOLVED FURTHER that the Pension Plan Committee is author- . ized to receive and invest contributions made by the Agency and its employees in each pay period after December 31, 1982, to seek approval of the United States of America Department of Housing and Urban Development to the transfer of the value of the Pension Fund accumulation accounts to another funding agency, to prepare documents effecting such transfer for further Agency review and approval , and to take all other action necessary or convenient to carry out this resolution. - � i6 d J��.� RESOLUTION N0 . 82-12/16- ;��:�'< RESOLUTION DIRECTING DISCONTINUANCE OF PENSION �•�:��' _ CONTRIBUTION UNDER GROUP ANNUITY CONTRACT WITH THE MUTUAL BENEFIT LIFE INSURANCE COMPANY AND � AUTHORIZING OTHER ACTIONS � RESOLVED by the Board of Commissioners of the Housing and � Redevelopment Authority of the City of Saint Paul, Minnesota, Contract-Holder of Group Annuity Contract No . GA-1052 (Contract) dated January 1, 1974, issued by The Mutual Benefit Life Insurance Company (Company) , and Principal Employer under the "Pension Plan of the Housing and Redevelopment Authority of the Ci:ty of Saint Paul, Minnesota" (Plan) dated January l , 1974, as follows : 1 . That in accordance with Contract Section G1(a) payment of Plan contributions to the Company is discontinued effective � December 31 , 1982, and thereafter said � . contributions are to be received and invested by the Pension Plan Committee . 2 . That in accordance with Plan Section 9 . 1 a Plan amendment and Trust Indenture �� be drafted constituting the Committee as r�:.�. `� Trustee for investment of the Pension l ` Fund for further consideration by the Board. � 3 . That in accordance with Handbook HM 7217 dated July 1974, or as the same may be revised, HUD approval of the Plan amendment and withdrawal of the Pension Fund from the Company with transfer of investment to Investment Advisors, Inc. , and of the Trust Indenture be obtained. RESOLVED FURTHER that the Executive Director and Pension Plan Committee are authorized and directed to take all necessary actions . to carry out the purposes of this Resolution. M;' _, ,.. ',:� - _------ -- --_-- __ __ _ _ - --- --- .-- Fw�J��! -------- WHITE - CITV CLERK PINK - FINANCE C I TY O F SA I NT PA U L Council CANARV - DEPARTMENT BLUE - MAVOR File N . Council Resolution Presented By � Referred To Committee: Date - Out of Committee By Date RESOLUTION DIRECTING DISCONTINUANCE OF PENSION CONTRIBUTIONS UNDER GROUP ANNUITY CONTRACT WITH MUTUAL BENEFIT LIFE INSURANCE ' COMPANY AND AUTHORIZING INTERIM INVESTMENT OF PENSION CONTRIBUTIONS AND OTHER ACTION RESOLVED, by the Council of the City of Saint Paul, a partici- pating employer under Group Annuity Contract No. GA-1052 (Contract) between the Mutual Benefit Life Insurance Company (Company) and the HRACSPM dated January 1, 1974, and an associate em loyer under the Pension Plan, that in accordance with Section G1(a� of said Contract, contributions are discontinued effective January 1, 1983, by written notification to the Company to be made forthwith; RESOLVED FURTHER, that the Pension Plan Committee is authorized to receive and invest contributions ma.de by the City and its participating employees in each pay period after December 31, 1982, pursuant to the Plan, to seek approval of the United States of America Department of Housing and Urban Development to the transfer of the value of the Pension Fund accumulation accounts to Investment Advisors, Inc. , to prepare documents effecting such � transfer for further City Council review and approval, and to take all other action necessary or convenient to carry out this resolution. - COUNCILI4EN Requested by Department of: Yeas Nays Fletcher LB1�"e In Favor Masanz Nicosia scnetbet _ Against By Tedesco Wilson Form Approved by City Attorney Adopted by Council: Date Certified Passed by Council Secretary BY BS- . , Approved by 'Navor: Date _ Approved by Mayor for Submission to Council sy _ Bv