The most notable topic addressed at the meeting was the analysis of the investment performance for both the police and fire pension funds. Carrie, the presenter, provided an in-depth report, noting positive trends in the equity markets. The S&P index experienced a rise of nearly 3% for the quarter, with small caps showing particular strength, increasing by more than 2%. Carrie emphasized the resilient state of the U.S. economy, driven by capital expenditures in artificial intelligence and consumer spending from wealthier households, contributing to a healthy GDP. Inflation rates were reported to be stable around 2.6% to 2.7%, slightly above the Federal Reserve’s target but considered reasonable historically.

Carrie’s presentation highlighted a rotation in market trends, where growth stocks saw a decline due to concerns over early AI spending, while value stocks gained traction. The international equities segment benefited from a weakening U.S. dollar and supply chain reshoring, particularly in countries like Mexico and Taiwan. Fixed income investments showed modest gains, with long-term interest rates remaining stable. Carrie presented impressive annual performance figures for 2025, with the S&P index increasing almost 18% and international indices surpassing 30%.

Carrie provided specific insights into the pension funds’ growth over the past decade. The fire fund grew to approximately $22.16 million, nearly doubling from $11.6 million, factoring in $2.5 million in payouts. Similarly, the police fund reached about $21.4 million. Both funds maintained compliance with their investment policies despite a slight overweight in equities, which had driven the bulk of returns. The quarterly performance showed a gain of approximately 1.8% for both funds, trailing their benchmarks due to challenges in large growth and value sectors.

Notably, international equities outperformed expectations, with the international value segment rising over 6.5%, thanks to DFA’s value investments in European financials, which saw gains exceeding 100% for the calendar year. However, the large-cap growth sector struggled, impacted by underperformance from stocks like Spotify and DoorDash. The fixed income segment displayed modest gains, with Dodge and Cox benefiting from credit securities, and PIMCO reporting a 2% return for the quarter. Real estate investments, primarily yielding from income, showed around 1% gross returns.

The meeting also addressed the lack of direct investments in critical minerals or precious metals, although some managers held related stocks. The board discussed ASB’s performance, noting the firm’s move towards full liquidation and the reduction of its office allocation, which was seen positively.

Another aspect of the meeting was the legislative update provided by Pedro, despite communication issues. He outlined ongoing reviews of issues such as redistricting and property taxes but reported no immediate concerns requiring board action. Pedro emphasized the importance of protocols for decision-making between meetings, especially regarding contracts or investments, to address potential issues promptly without needing special meetings.

The meeting concluded with an acknowledgment of Dan’s last session, necessitating the search for a replacement member. Members were reminded to complete the required Form One. The board expressed satisfaction with the meeting’s efficiency, noting it might have set a record for brevity.