09-22-2004 Special MeetingMIAMI SHORES VILLAGE
POLICE PENSION BOARD SPECIAL MEETING
SEPTEMBER 22, 2004
1. CALL TO ORDER
The special meeting of the Miami Shores Village Police Pension Board was held on Wednesday,
September 22, 2004 in the Conference Room of the Village Hall. The meeting was called to order at
8:00 A.M.
2. ROLL CALL
In order for the record to reflect those present the roll was called with the following members present:
Ed Quinton, Chairman, via telephone
Al Davis
Sergeant David McLeod
Officer Clifford Vickers
Also Present: Steve Cypen, Pension Board Attorney
Mark A. Malatak, Plan Administrator
Lisa Keeley, Recording Secretary
3. DISCUSSION AND POSSIBLE ACTION REGARDING THE RETENTION OF
CONSULTANT, MERRILL LYNCH
Mr. Malatak explained that this special meeting was requested by several Board members who have expressed
some recent concerns regarding the services provided by Merrill Lynch. Mr. Malatak gave a brief overview of the
consulting services provided by Merrill Lynch relating to the overall operations of the investment component of
the plan. In addition, Merrill Lynch handles some of the trades through their brokerage firm which is disclosed
quarterly through an offset against the quarterly fees.
The question proposed is whether or not Merrill Lynch, through Jeff Swanson and his associates, is providing the
proper and necessary recommendations to the Board. Mr. Cypen gave a brief overview regarding the two
consulting styles between "large" houses and independent firms.
Board members expressed concerns regarding the relationship between Merrill Lynch and the investment
managers especially the neutrality that does not seem to exist in the relationship with additional concerns
regarding the advice, or lack there of, from Merrill Lynch. Mr. Benton spoke of the budgetary concerns duetothe
possible strategy recommended by Merrill Lynch. Additionally, he added that Mr. Swanson was not amenable to
questions brought to his attention. Others noted that over the years, the plan has paid excessive annual fees that
do not seem justified by the quality of service received.
Discussion regarding a possible change in the consulting group at Merrill Lynch ensued. Mr. Cypen broke down
the current four person team as Jeff Swanson, Melissa (Jeff's sister) who is married to Mike Callaway, the head
of the team, and Larry Cole. None of the Board members knew of this "family" relationship.
Mr. Quinton noted his own concerns expressed by the Board noting the stagnant presentations of and attention
deficit to the Police plan. He provided two options in order to proceed. The first option would be to retainMerrill
Lynch, requesting another team assignment. The second would be to explore other consulting firms.
•
•
•
Police Board Special Meeting September 22, 2004 Page 2
Mr. Quinton left at this time.
A motion instructing staff to make inquires into the possibility of changing investment consultants (performance
monitors) was made by Mr. Davis. The motion was seconded by Sgt. McLeod. The vote was unanimous in
favor.
Mr. Cypen provided independent consultants listing GRS Asset Consultants, Burgess Chambers and Joseph
Bogdhan. Mr. Benton noted that it was not the size of the company, rather it is the service provided. Mr. Cypen
also suggested contacting Smith Barney as a comparable company to Merrill Lynch.
4. ADJOURNMENT
The September 22, 2004 special meeting of the Police Pension Board was adjourned at 8:30 A.M.
Lisa Keeley, Recording Secretary