October 2016 Monthly Board Report

REPORT SHOWS OP&F AGAIN MEETS STATE FUNDING REQUIREMENT

OP&F’s actuarial consultants have reported that the recently completed valuation report shows that the system continues to meet the state’s funding requirement. The report, which includes data through Jan. 1, 2016, shows a 29 year funding period. Ohio requires a 30 year funding period. The funding ratio for OP&F stands at 71.3 percent. The previous year’s valuation report showed OP&F with a 30 year funding period and a funding ratio of 70.8 percent. The report from Buck Consultants also confirmed that the Deferred Retirement Option Plan (DROP) continues to work as intended and requires no alterations to keep it cost-neutral to OP&F.

FALL BOARD RETREAT SCHEDULED FOR NOV. 1

OP&F’s Board of Trustees will meet Tuesday, Nov. 1 for a one-day retreat at the Blackwell Inn and Conference Center on the campus of Ohio State University. The meeting will be open to the public and agenda topics include pension and health care funding, long-term health care challenges facing the organization and the 2017 OP&F budget.

PORTFOLIO UPDATE
OP&F's investment portfolio value:

Board of Trustees Committee Notes
(Motions approved by the Board are listed separately)

• DISABILITY: In addition to the regularly scheduled hearings, the Committee received the Disability Experience Report for the 3rd quarter of 2016. Staff also updated the Committee on the number of Annual Earnings Statements that are outstanding.
• BENEFITS: The Committee received the Deferred Retirement Option Plan Experience Report for the 3rd quarter of 2016. The Committee also discussed the recently concluded Annual Change Period seminars, noting that attendance was more than 600.
• FINANCE: The Committee reviewed and discussed proposed 2017 department budgets and the 2017-19 Capital Budget during its meeting.
• ADMINISTRATION/AUDIT: The Committee received updates on ongoing projects involving the Business and Technology Solutions Department and received the Internal Audit status report.
• INVESTMENT: In addition to the monthly portfolio update, the Board received the Semi-Annual Securities Lending Report and the Semi-Annual Proxy Voting Report, both reports covered the first half of 2016.
  
  Motions:
  At its October 2016 meeting, the OP&F Board of Trustees voted on the following motions:
• Approved Staff and Wilshire’s recommendation to select Loomis Sayles and Prudential to manage U.S. Levered Core Bond mandates. Motion passed by unanimous vote (Investment Committee).
• Approved Townsend’s recommendation to commit up to $50 million to the Brookfield Premier Fund. Motion passed by unanimous vote (Investment Committee).
• Approved the manager ratings for OP&F’s Real Estate Managers as recommended by the Townsend Group. Motion passed by unanimous vote (Investment Committee).
• Approved Staff’s and TorreyCove’s recommendation to commit up to $40 million to MBK Fund IV, L.P. Motion passed by unanimous vote (Investment Committee).
• Approved staff’s recommended manager ratings for Dimensional Fund Advisors, Franklin Templeton, Pyramis Global and Bridgewater GIPS. Motion passed by unanimous vote (Investment Committee).
• Approved staff’s recommendation to change the policy index for Loomis Sayles and MacKay Shields (Opportunistic) from the CSFB High Yield Index Developed Countries Only to the Merrill Lynch Yield Master II Constrained Index. Motion passed by unanimous vote (Investment Committee).
• Approved the Committee recommendations for the initial determination of disability for the members as identified in the initial determination hearings list presented to the Board on Oct. 19, 2016. Motion passed by unanimous vote. (Disability Committee).
• Approved the Committee recommendation for reconsideration for the members identified in the reconsideration hearings list presented to the Board on Oct. 19, 2016. Motion passed by unanimous vote (Disability Committee).
• Approved the Committee recommendations for appeal hearings for the members identified in the appeals list presented to the Board on Oct. 19 2016. Motion passed by unanimous vote with the exception of the vote for member #2, which passed by a vote of 7-0 with one abstention (Disability Committee).
• Approved the Committee recommendation for Death Fund benefits for the members identified. Motion passed by unanimous vote (Disability Committee).
• Waived the mandatory medical evaluation and filing of annual earnings statements for future years for the members identified in the disability reporting waivers list presented to the Board on Oct. 19, 2016. Motion passed by unanimous vote (Disability Committee).
• Approved the Administrative Rules outlined in staff’s memorandum dated Oct. 18, 2016 and authorized the required filing of the rules with the proper agencies. Motion passed by unanimous vote (Benefits Committee).
• Approved the Administrative Rules outlined in staff’s memorandum dated Oct. 18, 2016 and authorized the required filing of the rules with the proper agencies. Motion passed by unanimous vote (Benefits Committee).
• Approved the 2016 OP&F Communications Plan for submission to the Ohio Retirement Study Council in the form presented on Oct. 18, 2016. Motion passed by unanimous vote (Administration/Audit Committee).
  
  

BOARD OF TRUSTEES RETREAT: Nov. 1, 2016

NEXT BOARD OF TRUSTEES MEETINGS: Nov. 15-16, 2016