MINUTES OF MEETING
STATE EMPLOYEES RETIREMENT COMMISSION
OFFICE OF THE STATE COMPTROLLER
55 ELM STREET
HARTFORD, CONNECTICUT 06106

October 20, 2011

TRUSTEES PRESENT

Peter Blum, Chairman
Charles Casella
Claude Poulin
Michael Carey
Linda Yelmini
Bob Coffey
Richard Cosgrove
Ronald McLellan
Thomas Culley
Bob Baus
Paul Fortier
Steve Greatorex
James Dzurenda
Fae Brown-Brewton

TRUSTEES ABSENT
Sal Luciano

EX OFFICIO MEMBERS
Deputy Comptroller Martha Carlson, for Comptroller Lembo
Deputy Treasurer Jonathan Harris, for Treasurer Denise Nappier

MUNICIPAL LIAISON
Thomas Landry

OTHERS PRESENT
Brenda Halpin, Director, Retirement Services
LeeAnn Palidino, Treasury
Jeanne Kopek, Asst. Director, Retirement Services
Helen Kemp, Asst. Director, Attorney for Retirement Services
Colin Newman, Asst. Director, Retirement Services
Natalie Braswell, General Counsel to the State Comptroller
Peggy Gray, Exec.Asst, Retirement Services Division
Christine Shaw, Treasury

GUESTS
George Spurlock, CEIU

CALL TO ORDER

The Chairman called the meeting to order at 9:08 AM

Chairman's Report

A draft of the calendar of meetings for the State Employees Retirement Commission for year 2012 has been handed out. Trustees are asked to take a look at the draft and the calendar will be put on the agenda for the November meeting for approval.

DIVISION DIRECTOR'S ADMINISTRATIVE AND SUBCOMMITTEE REPORTS
At the last Commission meeting a question was raised as to the number of Disability cases that have a retirement date of a least a year or more. We have researched this matter and have found that 38 cases have a retirement date of at least a year or more.

Of the 38 cases:

11 cases are collecting W/Comp at the present time.

18 cases have been denied before and are appealing.

7 cases have been tabled before and have submitted records to be reviewed.

2 cases need to go before the MEB once all of the paperwork is received in.

Pending Disability Applications as of September 30, 2011

Pending Applications 78
Pending Applications waiting for documentation 269
Applications Scheduled for upcoming meetings 142
Total Pending 489
For the month of September
Number of Applications Received 41
Number of Applications on Agenda 53
Number of Applications Approved 28

We are reviewing October 2011 cases. Reviews are being done in chronological order and as such either the cases are being scheduled for the Medical Examining Board's review or medical documentation is being requested. We receive requested medical documentation on a daily basis which allows the scheduling of pending cases. The next available meeting for scheduling is May 2012.

Following the close of the October 2011 retirement payroll, the current backlog of unfinalized retirement records is approximately 13,189. The Division processed 671 new retirees to payroll (625 normal, 46 disabilities). Finalizations for the month were 4. Finalization audits are now being completed for 2006. In an effort to address the number of unfinalized retirement records we are forming an internal committee to discuss ideas on how best to address it.

Documentation has been provided for your review and consideration regarding the Governmental Accounting Standards Board's proposed revisions to Statements 25 (Financial Reporting for Pension Plans) and 27 (Accounting for Pensions by State and Local Governmental Employers). Comments from all concerned regarding the exposure drafts were due on October 14th to GASB. Information on this topic has been provided at previous meetings.

Copies of the 2011 Benefits Statements have been provided for your review. The statements were revised to include the information on the SEBAC changes and the Section 415 limitations. These are John Doe copies with generic information. We will be reviewing the calculations for each Tier with the next group of samples. The statements are expected to be mailed within the next two or three weeks.

Update on the status of the Section 415 Testing by the Actuaries the compliance testing was completed on September 27th. Approximately 65 people were identified prior to January 1st 2011. There are 44 that need further review because they are hazardous duty employees. Additional information was provided to the actuaries on October 14th
with the after tax employee contributions.

The November 2011 Agenda will contain an item related to Conn. General Statute 7-432, which governs MERS Retirement Disability Benefits on which the Comptroller's Office has received a challenge as to the interpretation of the statute.

NEW MATTERS

1. REQUEST COMMISSION APPROVAL OF THE SEPTEMBER 15, 2011 MINUTES. Mr. Carey moved, seconded by Mr. Baus to approve the September 15, 2011 minutes. All voted in favor

Unanimous Decision

2. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT COMMISSION CHAIRMAN'S PER DIEM EXPENSES REIMBURSEMENTS. Ms Brown-Brewton moved, seconded by Mr. Coffey to approve the State Employees Retirement Commission Chairman's Per Diem expenses and reimbursements. All voted in favor

Unanimous Decision

3. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT SYSTEM SERVICE RETIREMENTS FOR THE MONTH OF SEPTEMBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the State Employees Retirement System Service Retirements for the month of September 2011. All voted in favor

Unanimous Decision

4. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT SYSTEM VOLUNTARY PENDING DISABILITY RETIREMENTS FOR THE MONTH OF SEPTEMBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the State Employees Retirement System Voluntary Pending Disability Retirements for the month of September 2011. All voted in favor

Unanimous Decision

5. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT SYSTEM DISABILITY RETIREMENTS FOR THE MONTH OF SEPTEMBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the State Employees Retirement System Disability Retirements for the month of September 2011. All voted in favor

Unanimous Decision

6. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT SYSTEM RETROACTIVE RETIREMENTS FOR THE MONTH OF SEPTEMBER 2011. Mr.Baus moved, seconded by Mr. Poulin to approve the Retirement System Retroactive Retirements for the month of September 2011. All voted in favor

Unanimous Decision

7. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT SYSTEM PRE RETIREMENT DEATH BENEFIT RETIREMENTS FOR THE MONTH OF SEPTEMBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the State Employees Retirement System Pre Retirement Death Benefit Retirements for the month of September 2011. All voted in favor

Unanimous Decision

8. REQUEST COMMISSION APPROVAL OF THE CONNECTICUT PROBATE JUDGES AND EMPLOYEES RETIREMENT SYSTEM SERVICE RETIREMENTS FOR SEPTMEBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the Connecticut Probate Judges and Employees Retirement System Service Retirements for September 2011. All voted in favor

Unanimous Decision

9. REQUEST COMMISSION APPROVAL OF THE JUDGES, FAMILY MAGISTRATES AND COMPENSATION COMMISSIONERS RETIREMENT SYSTEM RETIREMENTS FOR SEPTEMBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the Judges, Family Magistrates and Compensation Commissioners Retirement System Retirements for September 2011. All voted in favor

Unanimous Decision

10. REQUEST COMMISSION APPROVAL OF THE CONNECTICUT PROBATE JUDGES AND EMPLOYEES RETIREMENT FUND PERSONAL EXPENSES FOR THE MONTH OF SEPTEMBER 2011. Mr. Baus moved, seconded by Mr. Poulin to approve the Connecticut Probate Judges and Employees Retirement Fund Personal Expenses for the month of September 2011. All voted in favor

Unanimous Decision

11. REQUEST COMMISSION APPROVAL OF THE MUNICIPAL EMPLOYEES RETIREMENT SYSTEM RETIREMENTS. Mr. Baus moved, seconded by Mr. Poulin to approve the Municipal Employees Retirement System Retirements. All voted in favor

Unanimous Decision

12. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT COMMISSION MANAGEMENT TRUSTEE'S PER DIEM AND TRAVEL EXPENSES REIMBURSEMENTS. Ms. Brown-Brewton moved, seconded by Mr. Greatorex to approve the State Employees Retirement Commission Management Trustee's Per Diem and Travel Expenses reimbursements. All vote in favor - Mr. Baus abstained

Majority Decision

13. REQUEST COMMISSION APPROVAL OF THE STATE EMPLOYEES RETIREMENT COMMISSION UNION TRUSTEE'S PER DIEM AND TRAVEL EXPENSES REIMBURSEMENTS. Mr. Greatorex moved, seconded by Mr. Culley to approve the State Employees Retirement Commission Union Trustee's Per Diem and Travel Expenses reimbursements. All voted in favor - Mr. Poulin abstained

Majority Decision

14. REQUEST COMMISSION APPROVAL OF THE RECOMMENDATION OF THE SUBCOMMITTEE ON HAZARDOUS DUTY SERVICE CREDIT FROM THEIR MEETING ON SEPTEMBER 29, 2011. Ms. Brown-Brewton moved, seconded by Mr. Poulin to approve the recommendation of the Subcommittee on Hazardous Duty Service Credit from their meeting on September 29, 2011. Ms. Yelmini and Mr. Baus voted no. Mr. Casella, Mr. Poulin, Mr. Carey, Mr. Coffey, Mr. Cosgrove, Mr. McLellan, Mr. Fortier, Mr. Greatorex, Mr. Dzurenda and Ms. Brown-Brewton voted yes.

Majority Decision

15. REQUEST APPROVAL OF THREE MATTERS CONSIDERED AT THE SEPTEMBER 28, 2011 MEETING OF THE SUBCOMMITTEE ON REGULATIONS AND OVERPAYMENTS . Mr. Casella moved, with the change of FOUR MATTERS, seconded by Mr. Greatorex to approve the decisions of the Subcommittee on Regulations and Overpayments at their Subcommittee meeting of September 28, 2011.

(1) Donna Bray (SERS) - member- Overpayment due to receiving a social security disability benefit.

Subcommittee Action: Ms. Yelmini moved, seconded by Mr. Casella to recommend to the Commission to deny the request for waiver of repayment of an overpayment as Ms Bray did not meet all the statutory and regulatory requirements required for approval and to further recommend to the Commission that overpayment should be recovered by keeping all of her retirement benefit until the money has been paid back. Unanimous Decision. The subcommittee noted that the record indicated Ms. Bray intentionally failed to disclose receipt of her social security disability payments to the Division by checking off "no" on her annual surveys (2005, 2006, 2007 and 2008) which asked if she received such benefits during the year.

(2) Karen Heilweil (MERS) -member- Overpayment due to receiving a workers compensation award and not reporting it to MERS

Subcommittee Action: Ms. Yelmini moved, seconded by Mr. Culley to recommend to the Commission to deny the request for a waiver of repayment of an overpayment as Ms. Heilwiel did not meet all the statutory and regulatory requirements required for approval and to further recommend to the Commission that overpayment should be recovered by keeping all of her retirement benefit until the money has been paid back. Unanimous Decision. The Subcommittee noted that the record indicated both Ms. Heilweil and her counsel knew that her workers compensation payments were offset to her benefit and did not inform MERS of the payments.

(3) Paul Hughes (SERS) - member- Overpayment due to outside earnings.

Subcommittee Action: Ms. Yelmini moved, seconded by Mr. Coffey that if Mr. Hughes does not submit his tax returns and financial affidavit to the Division as requested by October 28, 2011 (date stated in the letter sent to him), that his request for waiver be denied and that the Division utilize any means possible to obtain repayment. Unanimous Decision.

(4) Dennis Martin (MERS) - member- Overpayment due to receiving a social security disability benefit.

Subcommittee Action: Mr. Casella moved, seconded by Mr. Coffey to recommend to the Commission to deny the request for waiver of repayment of an overpayment as Mr. Martin did not meet all of the statutory and regulatory requirements required for approval. Unanimous Decision

All voted in favor of the motion

Unanimous Decision

16. DISCUSSION OF POTENTIAL COMMISSION REGULATION WITH REGARD TO A STATUTE OF LIMITATIONS FOR CLAIMS BROUGHT TO THE RETIREMENT COMMISSION IN FRONT OF THE MEDICAL EXAMINING BOARD. After receiving the written information Mr. Baus moved, seconded by Mr. Greatorex to table this item to the November 17, 2011 meeting for discussion. All voted in favor

Unanimous Decision

17. REQUEST COMMISSION APPROVAL OF THE PARTICIPATION OF THE PLAINVILLE-SOUTHINGTON REGIONAL HEALTH DEPARTMENT EMPLOYEES IN THE CONNECTICUT MUNICIPAL EMPLOYEES RETIREMENT
SYSTEM EFFECTIVE JANUARY 1, 2012. Mr. Greatorex moved, seconded by Mr. Poulin to approve the participation of the Plainville-Southington Regional Health Department Employees in the CMERS effective January 1, 2012. All voted in favor

Unanimous Decision

18. REQUEST COMMISSION APPROVAL OF THE PARTICIPATION OF THE ESSEX BOARD OF EDUCATION CAFETERIA EMPLOYEES IN THE CONNECTICUT MUNICIPAL EMPLOYEES RETIREMENT SYSTEM EFFECTIVE JANUARY 1, 2012. Mr. Greatorex moved, seconded by Mr. Poulin to approve the participation of the Essex Board of Education Cafeteria Employees in the CMERS effective January 1, 2012. All voted in favor

Unanimous Decision

19. REQUEST COMMISSION APPROVAL OF THE PARTICIPATION OF THE DEEP RIVER BOARD OF EDUCATION CAFETERIA EMPLOYEES IN THE CONNECTICUT MUNICIPAL EMPLOYEES RETIREMENTS SYSTEM EFFECTIVE JANUARY 1, 2012. Mr. Greatorex moved, seconded by Mr. Poulin to approve the participation of the Deep River Board of Education Cafeteria Employees in the CMERS effective January 1, 2012. All voted in favor

Unanimous Decision

20. REQUEST COMMISSION APPROVAL OF THE PARTICIPATION OF THE CHESTER BOARD OF EDUCATION CAFETERIA EMPLOYEES IN THE CONNECTICUT MUNICIPAL EMPLOYEES RETIREMENT SYSTEM EFFECTIVE JANUARY 1, 2012. Mr. Greatorex moved, seconded by Mr. Poulin to approve the participation of the Chester Board of Education Cafeteria Employees in the CMERS effective January 1, 2012. All voted in favor

Unanimous Decision

AT 10: 35 MS. BROWN-BREWTON MOVED, SECONDED BY MS. YELMINI TO GO INTO EXECUTIVE SESSION TO DISCUSS ITEM #21 FOR LITIGATION PURPOSES AND ITEM # 22 FOR PERSONELL PURPOSES All voted in favor the Commission Trustees, Ex Officio Members, Helen Kemp, LeeAnn Palidino, Natalie Braswell, Director Brenda Halpin and Christine Shaw remained in the room. All voted in favor

Unanimous Decision

21. REQUEST COMMISSION APPROVAL OF THE PROPOSED DECLARATORY RULING (ON COURT REMAND) IN THE MATTER OF PRISCILLA DICKMAN TO BE ISSUED PRIOR TO NOVEMBER 1, 2011 IN ACCORDANCE WITH SECTION 5-155-1(e)(1)(A) OF THE REGULATIONS OF CONNECTICUT STATE AGENCIES

22. REPORT ON SUBCOMMITTEE STATUS/ACTION WITH REGARD TO THE RFP TO OBTAIN OUTSIDE LEGAL COUNSEL FOR ADVICE ON PLAN ADMINISTRATION AND QUALIFICATION UNDER IRC SECTIO 401 (a) AND SUBSEQUENT ACTION THAT MAY BE REQUIRED BY THE COMMISSION AND/OR OSC WITH REGARD TO THE SECTION 415 ISSUE. With regard to the status of the Section 415 testing, the actuaries have almost completed the testing for pre-January 1, 2011 retirees based upon the 2010 benefit limits. Further testing needs to be conducted on approximately half of the pool of 65 individuals preliminarily identified as exceeding the limits. This further testing will determine the allocation of the benefit to after tax employee contributions which could bring the retiree under the 415 limit. The additional information needed for this second stage to testing was provided to the actuaries on October 14, 2011.

AT 10:54 MS BROWN-BREWTON MOVED, SECONDED BY MS. YELMINI TO RETURN TO REGULAR SESSION All voted in favor

Unanimous Decision

On item # 21 Mr. Cosgrove moved, seconded by Mr. Greatorex to approve the Proposed Declaratory Ruling (On Court Remand) in the matter of Priscilla Dickman to be issued prior to November 1, 2011 in accordance with section 5-155-1(e)(1)(A) of the Regulations of Connecticut State Agencies. All voted in favor

Unanimous Decision

On item # 22 There was discussion on this matter with no motion to report out.

23. REQUEST COMMISSION APPROVAL OF THE RECOMMENDATIONS MADE BY THE INVESTMENT SUBCOMMITTEE AT THEIR MEETING OF SEPTEMBER 14, 2011. Mr. Greatorex moved, seconded by Mr. Carey to approve the recommendations made by the Investment Subcommittee at their meeting of September 14, 2011 Subcommittee meeting. All voted in favor

Unanimous Decision

24. REQUEST COMMISSION APPROVAL OF THE SEPTEMBER 21, 2011 RECOMMENDATIONS RECEIVED FROM ITS SUBCOMMITTEE ON PURCHASE OF SERVICE AND RELATED MATTERS. Mr. Greatorex moved, seconded by Mr. Carey to approve the recommendations received from its Subcommittee on Purchase of Service and Related Matters. All voted in favor with the exception that Mr. Carey abstained on Item #14.

Unanimous Decision

25. REQUEST COMMISSION ADOPTION OF CERTIFIED COURT ORDER AS EXCEPTION FOR SPOUSAL CONSENT WAIVER. Mr. Casella moved, seconded with Mr. Greatorex to table for the November 17, 2011 Commission meeting and refer this matter to the Actuarial Subcommittee prior to the November meeting. All voted in favor

Unanimous Decision

ADDENDUM ITEM #1

REQUEST TO RECONSIDER THE SEPTEMBER 2011 DECISION OF THE RETIREMENT COMMISSION WITH REGARD TO THE SERS ACTUARY CONDUCTING AN INTERIM VALUATION AND REVISED CALCULATION OF THE ANNUALLY REQUIRED EMPLOYER CONTRIBUTION TO THE FUND AS REQUESTED BY OPM. Ms. Yelmini moved seconded by Ms. Brown-Brewton for reconsideration on this issue. After discussion it was decided that the Commission reconsider their decision and request that the SERS Actuary prepare an interim valuation with revised calculations of the annual required employer contribution to the fund for the Commission's acceptance and certification to the Legislature. All voted in favor.

Unanimous Decision

ADJOURNMENT

Mr. Fortier moved, seconded by Mr. Baus to adjourn the meeting at 11:40. All voted in favor

______________________________ ___________________
Brenda Halpin, Director, Peter R. Blum, Chair
Retirement Services Division


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