The meeting’s focal point was the robust financial performance of the Fire and Police pension funds. Over the past decade, both funds have nearly doubled in size, with the Fire fund reaching approximately $20.8 million from $11 million and the Police fund growing to about $20.4 million from $10.7 million. Each fund achieved a 10-year return of 8.8% and 8.7%, respectively, despite experiencing nearly $3 million in net cash flow outflows. Notably, the funds earned around $13 million during this period. The strong performance was largely attributed to the domestic equity segment, which, despite some challenges, delivered substantial returns.

Asset allocation was a key topic, with the Fire fund’s composition consisting of over 52% in U.S. equity, about 17% in international equity, and approximately 15.5% in domestic fixed income. The Police fund had a similar allocation. Both funds were reported to be on target with domestic fixed income, slightly underweight in global fixed income, and intentionally underweight in real estate due to a redemption request from the real estate manager, ASB. A commitment was made to Mavic for a real estate debt strategy.

The conversation took an intriguing turn as the board considered the potential for investing in Bitcoin. An analysis showed that a 2% allocation to Bitcoin could have marginally improved performance. However, the volatility of Bitcoin and its absence in the current investment policy were noted as concerns. Modifications to the investment policy would be necessary to include cryptocurrencies, and further discussion on the topic was anticipated.

Insurance matters were also a priority, with Debbie reporting on the insurance premiums for both the Fire and Police sides. The Fire side’s premium decreased by $724.25, while the Police side saw a reduction of $718.19. Questions about the disparity in premiums were attributed to differences in asset levels and membership numbers. The board agreed to approve the insurance expenditure, with a motion made and seconded, resulting in unanimous agreement.

In terms of fund management, the board discussed the performance of specific segments. The Winslow fund, a part of the domestic equity segment, was highlighted for its underperformance due to not holding major technology stocks like Apple and Tesla. Despite this, other segments performed adequately, with some even outperforming the index. The overall international equities showed gains just over 7.5%, with contributions from Europacific and DFA.

The board also addressed the challenges of reallocating investments swiftly. A significant increase in cash holdings was noted, prompting a discussion about investing excess cash as interest rates decline. A board member expressed a preference for keeping cash but acknowledged the necessity of investing due to reduced returns from Federal Reserve interest rate cuts.

The performance of the ASB fund in real estate was scrutinized, with concerns about outdated assets and a conservative approach to leverage.

The board took measures to enhance operational efficiency by implementing a service called Canoe, designed for streamlining the aggregation of statements for alternative investments. The board expressed confidence in Canoe’s security protocols and industry reputation.

A procedural segment of the meeting reminded attendees of their obligations under state ethics laws. The board emphasized the importance of rejecting gifts intended to influence decisions, outlining specific thresholds for reporting and acceptance. Historically, the board provided holiday gifts under $25, but logistical issues led to charitable donations in clients’ names to local food banks across Florida instead.

Educational opportunities were also discussed, with an upcoming seminar by the Florida Public Pension Trustees Association highlighted as a valuable resource for board members. The seminar, scheduled for early February in Orlando, would cover essential topics related to public pensions, with board members encouraged to attend.