Actuarial report indicates gains in funding ratio, decrease in unfunded liability

The most recent actuarial valuation of OP&F was a promising report and confirmed the Fund�s sound investment strategies and decisions. Mellon Consultants, OP&F�s actuarial consulting firm, presented the preliminary Jan. 1, 2004 Actuarial Valuation during the January Board meeting, and will deliver the final version of the study to the Ohio Retirement Study Council (ORSC) in February.

The report showed that OP&F�s funding ratio as of Jan. 1, 2004 stood at 86.3 percent, up from 82.6 percent the previous year. The unfunded accrued liability was nearly $400 million less than the Jan. 1, 2003 report.

The actuarial report from Mellon is designed to measure the market value of OP&F�s assets, the actuarial value of assets, and actuarial assumptions. Mellon�s report, along with an investment report from Evaluation Associates to the ORSC in November indicate the success of OP&F�s investment plan and decisions. As of Dec. 31, 2004, OP&F�s investment portfolio had reached an all-time high of $9.78 billion.

2005 Trustee election notices to be mailed in February

In February OP&F will mail election notices to police departments throughout the state outlining the election process to select an active police officer representative to the Board of Trustees. Notices are scheduled to be mailed Feb. 7, with postcards sent to all active police members Feb. 11.

Nominating petitions and a certificate of eligibility for those interested in running for the position are due to OP&F by 4 p.m. April 4. Ballots will be mailed to active police members May 2, and the election results announced at the May Board of Trustees meeting. The four-year tem will commence June 6, 2005.

To assist candidates with new provisions since the passing of Senate Bill 133, all candidates will receive an information packet from OP&F outlining the duties, responsibilities and requirements of Board members.

External auditor selected to perform OP&F audits through 2007

Clark, Schaefer, Hacket & Company has been selected as OP&F�s new external auditor.

The Ohio-based firm is from Springfield, and ranks as one of the top-50 largest CPA firms nationally.

They will perform audits of OP&F financials for a five-year period from 2003 thru 2007. The firm is expected to release OP&F�s 2003 audit in April, with the 2004 audit to be completed in June.

Motions Approved

At its Jan. 26, 2005 meeting, the Ohio Police & Fire Board of Trustees approved the following motions:

• Accepted the rating recommendation of staff for Shenkman Capital Management (Investment Committee).
• Accepted the rating recommendation of staff for W.R. Huff Asset Management, and directed staff to proceed with actions as needed (Investment Committee).
• Approved the Initial Determination Hearings (Disability Committee).
• Approved the Appeal Hearings (Disability Committee).
• Approved the Disability Reconsideration Hearings (Disability Committee).
• Approved the Death Fund Benefit Hearings (Disability Committee).
• Approved waiving the required filing of annual earnings statements and annual medical evaluations for 2004 and future years for those disability benefit recipients identified in the list presented to the Board on Jan. 25, 2005, in accordance with the Policy on Waiver of Earnings Statement and Medical Evaluation (Benefits Committee).
• Approved changes to Administrative Rule 742-3-06/Calculation of On-Duty Disability Benefits (Disability Committee).
• Adopted the 2004 Annual Disability Experience Report (Disability Committee).
• Approved changes to Administrative Rule 742-5-02/Interest Rate for Service Credit Purchases (Disability Committee).
• Approved the Notice, Official Nominating Petition, and Certificate of Eligibility for the upcoming election of the active police officer employee member to the OP&F Board of Trustees.
• Approved OP&F becoming a Drug-Free Workplace consistent with the policy presented to the Board (Administration & Audit Committee).
• Approved the travel recommendations of the Administration & Audit Committee (Administration & Audit Committee).

Attachments

• Comments from Chief Investment Officer
• Proposed revised rule 742-3-06 Calculation of on-duty disability benefits on less than three years of salary.
• Proposed revised rule 742-5-02 Interest rate for service credit purchases or refunds/purchase of civilian service credit.