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Record of Proceedings

AIFM Board Special Meeting - September 23, 2021: Investment Performance Reports

Administration, Investment, & Fiscal Management Board — Thursday, September 23, 2021
BodySacramento, California
SessionAdministration, Investment, & Fiscal Management Board
DateThursday, September 23, 2021
StatusFILED
Video Record
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Transcript — Verbatim
0:20

Chair Staff is ready when you are to order.

0:27

My name is Matty Leon.

0:28

I'm chair of this committee.

0:30

I just want to make a couple quick notes really quick that uh this public meeting is currently being teleconferenced only to align what local and federal guidelines and social state recommendations for the conveyor for the containment containment of the coronavirus.

0:44

Uh for staff, board members, and those logged onto the meeting.

0:47

Please remember to keep your microphones muted when you are not speaking.

0:50

Board members should keep their video on at all times.

0:53

Uh, we will be monitoring for the raise have feature in the Zoom member comments.

0:57

For members of the public that are tuning in, you are encouraged to submit your public comments using the e-comment on the online agenda page.

1:04

Members of the public participating via Zoom.

1:06

You if you would like to speak on an agenda item, please raise your hand for the item to begin.

1:11

Uh if there's any questions, please put Phil in the comment uh in the comment chat uh box and we'll move forward from there.

1:18

Uh with that being said, may we have a roll call looking at the agenda for a quorum.

1:25

Thank you.

1:25

Member Colville.

1:28

Here.

1:28

Member Holm will be absent.

1:30

Vice Chair Bader.

1:38

Vice Chair Bader.

1:41

Oh, here.

1:43

We can now.

1:44

Chair Leon.

1:45

Oh, okay.

1:46

Here, present.

1:47

Thank you.

1:48

You have a quorum.

1:49

All right.

1:50

Now we'll move on to the consent calendar.

1:52

Uh, we'll need a motion and a second for the consent calendar items one through four of the agenda.

1:58

I'll make a motion to move the calendar.

2:00

And I will second it.

2:03

All right.

2:04

Uh uh, are there any comments from the public on this particular on the consent calendar?

2:09

I have no hands raised to make comment on this item.

2:13

Perfect.

2:14

Sounds good.

2:14

All right.

2:15

Uh, then we have a uh vote, uh roll call vote on this uh consent calendar.

2:20

Thank you.

2:20

Member Colville.

2:22

Yes.

2:23

Vice Chair Bader.

2:24

Yes.

2:25

And Chair Leon.

2:27

Yes.

2:27

And motion passes.

2:29

All right.

2:30

Now we're on to the discussion calendar item number five.

2:34

Craig, you have the floor or video.

2:38

All right.

2:39

Thank you all.

2:40

It's good to see everybody.

2:43

I apologize, but this is probably gonna be pretty brief.

2:47

When you look at the numbers, they're really good.

2:50

Um, this is taking a look at results through the end of the second quarter.

2:59

Um, you know, you look at that top chart, you see equity returns still off the chart.

3:05

Um, you know, we're in mid to high double digits.

3:09

Um, you know, for the year to date period.

3:12

We did see a you know, fairly decent reversal um in terms of what had been working in the fourth quarter and first quarter versus what worked in the second quarter.

3:21

Uh so growth, large cap growth, especially came back into favor.

Discussion Breakdown — Share of Meeting
Investment Policy█████████████████████████████████████████████65%
Procedural█████████████████24%
COVID-19 Response████████11%
Summary of Proceedings

Administration, Investment & Fiscal Management Board (AIFM) Special Meeting – September 23, 2021

The Administration, Investment & Fiscal Management Board held a special teleconference meeting on September 23, 2021, at 1:30 p.m. to review investment performance reports for the Sacramento City Employees' Retirement System (SCERS). The board unanimously approved consent calendar items and accepted the quarterly performance and investment reports presented by Segal Marco Advisors and SCERS staff.

Consent Calendar

  • Approval of Minutes (May 20, 2021): Passed unanimously.
  • SCERS Monthly Investment Report (May 31, 2021): Accepted unanimously.
  • SCERS Monthly Investment Report (June 30, 2021): Accepted unanimously.
  • Revised Pensioners’ Cost of Living Adjustment FY22: Accepted unanimously.

Discussion Items

  • Item 5 – Segal Marco Advisors Quarterly Investment Performance Report (June 30, 2021): Craig Chaikin, Vice President of Segal Marco Advisors, presented a market overview. He noted strong equity returns, with large-cap growth leading in the second quarter, and fixed income benefiting from declining rates. The portfolio's total assets increased by approximately $10 million over the quarter to $313.5 million. For the fiscal year ended June 30, 2021, the portfolio returned 29.5%, slightly ahead of the policy index and the actuarial assumption. The 10-year return was 9.2%. Board members asked about the timing of potential interest rate hikes (expected sometime in 2022) and concerns about Chinese regulation; Chaikin stated it was not a specific concern for U.S. markets. The board unanimously accepted the report.

  • Item 6 – SCERS Quarterly Investment Report (June 30, 2021): Stacy Hussey, Chief Investment Officer, highlighted the reduction of the fixed-income underweight from 4% to just under 2% due to active rebalancing. She noted that the 10-year performance of 9.2% comfortably exceeded the actuarial assumption. Hussey reported that the funded status of SCERS may approach or exceed 100% based on the strong returns, and she is working with the actuary to model different scenarios. She compared SCERS’ 29.5% return to CalPERS (21.3%) and CalSTRS (27.2%). The board discussed the potential impact on city contributions; Hussey noted that contributions have already decreased from about $7 million to $3–4 million, and further improvement could lower them further, though the normal cost would still need to be paid. The board unanimously accepted the report.

Key Outcomes

  • Votes: Both discussion items (Items 5 and 6) were approved by a unanimous roll call vote: Member Colville (yes), Vice Chair Bader (yes), Chair Leon (yes). Member Holm was absent.
  • Member Comments: Chair Leon noted that the December 2021 meeting would be his last due to term limits, and he thanked staff and advisors for their work.
  • No public comments were received on any agenda item.
  • Adjournment: The meeting was adjourned without a formal motion.

Meeting Transcript

Chair Staff is ready when you are to order. My name is Matty Leon. I'm chair of this committee. I just want to make a couple quick notes really quick that uh this public meeting is currently being teleconferenced only to align what local and federal guidelines and social state recommendations for the conveyor for the containment containment of the coronavirus. Uh for staff, board members, and those logged onto the meeting. Please remember to keep your microphones muted when you are not speaking. Board members should keep their video on at all times. Uh, we will be monitoring for the raise have feature in the Zoom member comments. For members of the public that are tuning in, you are encouraged to submit your public comments using the e-comment on the online agenda page. Members of the public participating via Zoom. You if you would like to speak on an agenda item, please raise your hand for the item to begin. Uh if there's any questions, please put Phil in the comment uh in the comment chat uh box and we'll move forward from there. Uh with that being said, may we have a roll call looking at the agenda for a quorum. Thank you. Member Colville. Here. Member Holm will be absent. Vice Chair Bader. Vice Chair Bader. Oh, here. We can now. Chair Leon. Oh, okay. Here, present. Thank you. You have a quorum. All right. Now we'll move on to the consent calendar. Uh, we'll need a motion and a second for the consent calendar items one through four of the agenda. I'll make a motion to move the calendar. And I will second it. All right. Uh uh, are there any comments from the public on this particular on the consent calendar? I have no hands raised to make comment on this item. Perfect. Sounds good. All right. Uh, then we have a uh vote, uh roll call vote on this uh consent calendar. Thank you. Member Colville. Yes. Vice Chair Bader. Yes. And Chair Leon. Yes. And motion passes. All right. Now we're on to the discussion calendar item number five. Craig, you have the floor or video. All right.

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