Policemen's Pension And Relief Fund Board Of Trustees — Fayetteville, AR
Date: 2025-06-16
Time: 15:00

City of Fayetteville, Arkansas
 113 West Mountain Street
 Fayetteville, AR 72701
 (479) 575-8323




Special Meeting - Policemen's Pension & Relief Fund
 Board of Trustees Agenda
 Monday, June 16, 2025
 3:00 PM

 City Hall Room 101


 Board of Trustees
 Molly Rawn - Mayor & Chair
 Kara Paxton - City Clerk Treasurer
 Eldon Roberts - Position 1 & Secretary
 Ruston Cole - Position 2
 John Brown - Position 3
 Melvin Stanley - Position 4
 Rick Hoyt - Position 5
Policemen's Pension & Relief Special Meeting - Policemen's June 16, 2025
Fund Meeting Pension & Relief Fund Board of
 Trustees Agenda




ROLL CALL

REPORTS

UNFINISHED BUSINESS

NEW BUSINESS

 1. APPROVAL OF THE APRIL 17, 2025 MEETING MINUTES

 2. ACTUARIAL ANALYSIS

 3. 2025 ELECTION RESULTS ANNOUNCEMENT:
 POSITION 1 - ELDON ROBERTS
 POSITION 3 - JOHN BROWN
 POSITION 4 - MELVIN STANLEY




City of Fayetteville, Arkansas page 2

City of Fayetteville, Arkansas
 113 West Mountain Street
 Fayetteville, AR 72701
 (479) 575-8323




Special Meeting - Policemen's Pension & Relief Fund
 Board of Trustees Agenda
 Monday, June 16, 2025
 3:00 PM

 City Hall Room 101


 Board of Trustees
 Molly Rawn - Mayor & Chair
 Kara Paxton - City Clerk Treasurer
 Eldon Roberts - Position 1 & Secretary
 Ruston Cole - Position 2
 John Brown - Position 3
 Melvin Stanley - Position 4
 Rick Hoyt - Position 5
Policemen's Pension & Relief Special Meeting - Policemen's June 16, 2025
Fund Meeting Pension & Relief Fund Board of
 Trustees Agenda




ROLL CALL

REPORTS

UNFINISHED BUSINESS

NEW BUSINESS

 1. APPROVAL OF THE APRIL 17, 2025 MEETING MINUTES

 2. ACTUARIAL ANALYSIS

 3. 2025 ELECTION RESULTS ANNOUNCEMENT:
 POSITION 1 - ELDON ROBERTS
 POSITION 3 - JOHN BROWN
 POSITION 4 - MELVIN STANLEY




City of Fayetteville, Arkansas page 2
 Policemen’s Pension and Relief Fund
 Board of Trustees Minutes
 April 17, 2025
 Page 1 of 5



 Molly Rawn Chair Ruston Cole Retired Position 2
 Kara Paxton Treasurer John Brown Retired Position 3
 Eldon Roberts Secretary Melvin Stanley Retired Position 4
 Retired Position 1 Rick Hoyt Retired Position 5




 Policemen’s Pension and Relief Fund
 Board of Trustees Meeting Minutes
 April 17, 2025

A meeting of the Fayetteville Policemen’s Pension and Relief Fund Board of Trustees was held
on April 17, 2025, at 3:00 p.m. in Room 326 of the City Administration Building located at 113
West Mountain Street, Fayetteville, Arkansas.


Mayor Molly Rawn called the meeting to order.

Board Members Present: Board Members John Brown, Ruston Cole, Rick Hoyt, Eldon
Roberts, Melvin Stanley, Mayor Molly Rawn, and City Clerk Treasurer Kara Paxton.

Staff and Others Present: City Attorney Kit Williams, and Chief Financial Officer Steve
Dotson. In addition, Kerry Bradley and James Bell with MAI Capital Management were also
present.

Reports:

Quarterly Reports: 2024 - 4th Quarter and 2025 - 1st Quarter

Kerry Bradley, MAI Capital Management Representative, “Well, thanks for having us again. A
lot of new faces in the crowd. So for those of you who are new, we've been working with the
Fayetteville pension since 2014 we were Garrison Asset Management. We merged with another
firm back in December, so now we're in MAI Capital. So, we still got the same team, same people,
doing the same thing, just a little bit different name and a little different look. To jump into the
fourth quarter report, things didn't change too much through March. So I know we only meet every
six months, but 2024 was a good year. Portfolio was up a little north of 10% just under 11. Stocks
were strong. Bonds were strong. We were kind of right on target, little over allocated equity, little
under allocated fixed income. Again. If you guys have any questions about the fourth quarter, I
feel like so much has changed since then. We'll move along to the first quarter of 2025 that's what
we passed out. I think that should be in your agenda packet as well. We did not see it in there, so
we brought a copy as well. So if we want to run through the first quarter again, asset allocation.
We were still a little over allocated in stocks, but within the range of that 60/40, mix is what we
historically have managed the portfolios to 60% equity, 40% in stocks. We were there. We did
deploy some of the money market fund. I know we've talked about this for probably over a year
now, how money market rates have been higher than just about anything else you could earn, if
you extend, you're going to earn less. So we extended a little bit of that in the first quarter, bought
a few CDs to lock in those rates for a little longer. We kind of felt that short term rates might be
 Policemen’s Pension and Relief Fund
 Board of Trustees Minutes
 April 17, 2025
 Page 2 of 5

coming down that's still yet to be seen. The fixed income markets have given us a few fits lately,
but again, we're still on target, little over allocated in equity. Performance wise through the first
quarter, we're about flat. We were down point 2.7% stocks were down 1.07% that's against the
S&P that was down about 427, our fixed income was up. 156, versus 242, on the fixed income
index, rates dropped. Bonds did very well in the first quarter. That's kind of changed a little bit the
last few weeks. But again, we're flat, which we were happy with, versus the index should have
been down about 160. We gave you an updated portfolio appraisal as of yesterday. So again, as
you guys probably all watch the watch the news and the markets have been incredibly volatile.
The last two and a half weeks, we have seen a drastic sell off in stocks. Long, rates have gone up.
Short rates have come down. So there's a lot going on out in the market right now. So just to give
you an update, portfolios down to $5.907 million, and that's from about $6.1 at the end of the year.
So we're down a little over $150,000 dollars. Total portfolio since the end of the year is down
about 4% and again, most of that is stock performance. Again, we haven't made any drastic
changes. We typically don't. This is something that the markets cycle through. There will always
be ups and downs, and our philosophy on managing money is that we kind of have to, that's kind
of the price of admission. Those are the kind of the ups and downs we have to endure to get those
long-term returns. Looking back at long-term returns through the portfolio, since you guys have
been here, since 2014, our stocks have earned just under 10% and that's historically what stocks
should give you, about 10% a year. So, you know, when you look at a longer term time frame,
that's, you know, that's kind of what your stocks have done, and that's kind of what they're supposed
to do. The fixed income however, we've been through an incredible time of artificially low interest
rates. So your bonds have, will historically give you 4% to 5%, we've gotten about 2%. Since you
guys have been, you know, since we've been helping you with your investments. Again, that's a
function of where interest rates were. The financial crisis in 2008, those kinds of things, rates have
kind of normalized. Now rates are, honestly, where they should live. Now, given if we have a
recession, those short rates are going to come down. If we have more inflation, those rates are
going to go up. But hopefully, I think you guys, looking out for the next 10 years. You could get
some more normalized rates on your fixed income. The other thing we wanted to pass out, this is
kind of small. We couldn't figure out how to get it in a bigger font. This to kind of tell you where
you've been since, certainly since 2014. So this MAI pages, this graph, you guys started with about
$6.7 million, and then you've drawn out $4.5 million and you have just under $6 million still left.
So that's just a picture, of how the portfolio has kind of treaded water, even with some pretty large
withdrawal rates that have certainly been coming down over the last few years. So again, just for
that, we also wanted to pass out a guide to “bear markets”. We thought those would be appropriate
this time of our visit. Again, these times, they're always super scary when you're in them, when
you come out of them, you're like, well, of course, the world's not going to end, you know, it's like,
we should have known that. But, you know, no one has a crystal ball. But I want to point you to
page three. You guys can see how stocks are performed over the long term, and even things like
the financial crisis, the COVID panic, how they're kind of little blips on this upwardly sloping
stock performance. So again, we understand. We've had a lot of calls at the office, as you can
imagine, talking to folks. We feel like that's our job to talk people through these environments,
because again, they are scary. So again, we have a lot of faith in the stocks that we do all, none of
them are going to go bankrupt, even if we have a recession or if we have more inflation, we feel
very comfortable over the long term that's still the best place to earn great risk adjusted return. So,
to me, this is good information for everyone, personally, and for, you know, the pension plan and
all those things. James do you have anything to add?”
 Policemen’s Pension and Relief Fund
 Board of Trustees Minutes
 April 17, 2025
 Page 3 of 5

James Bell, MAI Capital Management Representative, “I just wanted to touch again on this page
with the chart, and I think we talked about it in our meeting six months ago when we got together.
I guess it just jumps out as me that if we started 10 plus years ago at $6.7 million, you've withdrawn
$4.5 million, and we're still right around $6 million of assets in the plan. I feel like that's kind of
the job that we have done on our side, is to fund those distributions for all the pensioners, and still
maintain this much principle for them going forward. So that's, that's just the number that jumps
out of me. And I know we covered it last time, but I thought it was helpful. I thought seeing it in
this graphical picture, that gray line that's going down through there that would have been the
portfolio, had you just set it in cash and withdrawn that four and a half million you can see how
much it would have declined.”

Kerry Bradley, “again, it kind of points back to like these times are scary. COVID was scary.
You know, the regional banking crisis was kind of scary. The financial crisis was scary back in
2008/2009, but even, you know, we've been moving around through all those and through 911
managing money. And so, you know, when you when you can step back and take a long term look,
and you're like, okay, it may not have felt like it. It may not feel like it recently, but you know,
your stocks have given you about 10% which is what they're supposed to do. So anyway, I don't
know if that delays any, any stress of anyone, but, but again, that's kind of, that's kind of that we
feel like, certainly that's our job to take a step back and to look at valuations. And we had two great
years in the market. The market was a bit rich. Valuations were a bit high, so we're kind of ripe for
a pullback anyway, and then, of course, all the tariff talk has certainly spooked some investors
again. It's frustrating in our world when one tweet can send the market up 3000 points or down
2000 points. You're having to live through that again, it's kind of part of part of the investment
world and the way the markets act.

Board Member Ruston Cole, asked MAI Capital Management Representative to provide
potential projections due to the volatility of the market.

Kerry Bradley explained her projections and the factors that might affect the market. Kerry
projected that the economy may slow, rates may go down, and the market recently took a dive.
She finalized her comments by explaining the Policemen’s Pension & Relief Fund portfolio is
fairly defensive.

A brief discussion took place regarding potential what-if scenarios and how the pension plan would
be affected should these scenarios happen.


Revenue & Expense Summary Reports: 2024 - 4th Quarter and 2025 - 1st Quarter

Kara Paxton, City Clerk Treasurer explained that the Revenue and Expense Summaries that
were attached to the packet were created by the Accounting Department based on the data that the
city receives from Charles Schwab Investments. She went on to explain that the summaries are
informational reports for the board.


Unfinished Business: None
 Policemen’s Pension and Relief Fund
 Board of Trustees Minutes
 April 17, 2025
 Page 4 of 5

New Business:

Request to Approve: October 17, 2024 & December 10, 2024 Meeting Minutes

Kara Paxton, City Clerk Treasurer provided a brief explanation why there were two sets of
minutes to be approved. She also went on to explain the reason the December 10, 2024 minutes
were completed verbatim. It was due to a request she received and the sensitivity of the topic
regarding who would be responsible for managing the portfolio should the board not continue with
Garrison Financial Management who merged with MAI Capital Management.

Rick Hoyt moved to approve the October 17, 2024 and December 10, 2024 meeting minutes.
Melvin Stanley seconded the motion. Upon roll call the motion passed unanimously.


Request to Approve: May – October 2025 Pension Lists

Board Member Ruston Cole moved to approve May – October 2025 Pension Lists. Board
Member Melvin Stanley seconded the motion. Upon roll call the motion passed 6-0. Mayor
Rawn abstained.


Discuss LOPFI Consolidation Options

Board Member Eldon Roberts, explained the reasons why he requested to have this item added
to the agenda to be discussed. He went on to explain that he had spoken with a lot of the
stakeholders involved and had received support to consolidate with LOPFI. He felt that it was his
fiduciary duty to ensure that the board was making the best decisions to ensure the longevity of
the pension plan. He finalized his comments by explaining his experience while serving on the
Pension Review Board spanning 14 years. During his appointment there were 286 pension plans
that were considered closed since no newly appointed police officer could opt into that type of
pension. Mr. Roberts also explained that to date, 255 of those plans have merged with LOPFI. Mr.
Roberts finalized his comments and made a motion.

There was a brief discussion regarding the procedural rules and steps that would need to be
followed to start exploring the possibility to consolidate with LOPFI.

Board Member Eldon Roberts, explained that the pension plan has been financially strong over
the course of the years. However, with the number of hurdles that would have to be jumped in
order to approve an increase in the pension benefits he did not foresee the board being able to
approve the increase. He went on to share the numbers he had obtained that compared the yield on
investment while the pension has been managed by MAI, Capital Management to the yield on
investment that LOPFI had obtained. He finalized his comments and asked City Clerk Treasurer
Kara Paxton to share the information she had been able to locate within the City’s records.

City Clerk Treasurer Kara Paxton, provided the information that Board Member Eldon Roberts
had requested. She explained that the last time an increase was reflected on the pension lists was
2008.
 Policemen’s Pension and Relief Fund
 Board of Trustees Minutes
 April 17, 2025
 Page 5 of 5

Board Member Eldon Roberts calculated that it had been 17 years since the pensioners had
received an increase in benefits. He explained the potential benefits of merging with LOPFI and
hoped that once the actuarial study was completed it would confirm that the pensioners could
consolidate with LOPFI and obtain a 3% COLA at no cost to the City of Fayetteville.

There was a brief discussion about the statutory obligation for the pension to merge with LOPFI
once there were no longer enough pensioners to serve on the Board of Trustees.

Board Member Eldon Roberts moved to grant the Mayor and the City Clerk authority to
start exploring the possibility of consolidating with LOPFI with a 3% compounded COLA
annually for all participants. Board Member Melvin Stanley seconded the motion. Upon roll
call the motion passed unanimously.

There was a brief discussion about the cost of the actuarial study. Ultimately, it was decided that
specific language that capped the expenditure did not need to be included within the motion.

Board Member Eldon Roberts moved to allow the Mayor and City Clerk to use the funds
needed from the plan’s assets to further the cause of consolidation with LOPFI. That would
be mainly the $850 to pay for the special actuarial valuation. Board Member Hoyt seconded
the motion. Upon roll call the motion passed unanimously.

Board Member Eldon Roberts, provided additional information regarding the calculation of the
current number of benefits paid monthly and the monthly amount that would be paid with a 3%
COLA. He went on to explain that with or without the 3% COLA he felt that the pension could
Consolidate with LOPFI.

There was a brief discussion regarding what would be considered unfunded liability.


Informational:

2025 Meeting Calendar
 • Next Meeting – October 16, 2025
 Note: All meetings are tentative and subject to change. The city meetings calendar is
 located at www.fayetteville-ar.gov .

Adjourn: 4:10p.m.
To: Local Fire and Police Pension Fund Boards of Trustees

From: Arkansas Fire and Police Pension Review Board (PRB)

Re: Evaluating Local Plan Investments

Date: May 1, 2025


This memo will aid Local Plan trustees with a key fiduciary duty: examination of the Local
Plan’s investment program. Trustees must ensure all assets and fees comply with the Local
Plan’s investment policy (Policy) and state law. Trustees should consult their investment
professional(s) and legal counsel to verify compliance with ACA 24-11-805 (fire plans) and 24-
11-410 (police plans). Local Plans with an investment advisor may also review ACA 24-10-402.
The PRB understands these code sections to state that allowed asset classes for a Local Plan with
assets above $100,000 but less than $5,000,000 are Cash (including savings accounts and CDs),
state and federal government bonds, and no-load mutual funds (no sales or redemption fees).

The trustees’ reviews should include:

 • Allocation- Confirm each asset class (domestic/international equities, bonds etc.)
 operates within the Policy or if rebalancing is needed.
 • Performance- Determine if investments generate performance consistent with their Index.
 • Index- Is each Index correct for measuring performance?
 • Fees- Clear disclosure of ALL investment-related fees on all monthly, quarterly, and
 annual statements prepared for the trustees. This includes fees/charges/costs for selling
 an asset and if those details were disclosed when the purchase was approved. If not, the
 trustees have an obligation to determine why and correct the failure.
 • Prohibited investments- Were assets purchased in violation of the Policy? If so, the
 trustees must identify how it occurred and take corrective steps. Note that NO annuity
 products are allowed as investments for any Local Plan.
 • Act 498 of 2023- Ensure full compliance with this act, which includes details of the
 fulfillment of your fiduciary duties.
 • Act 937 of 2025- Ensure applicable divestment requirements comply with this act.

This memo is not all-encompassing or legal advice; rather, it is a resource for Local Plan trustees
to evaluate their investment program. Please feel free to contact Jen Sines or Lesley Weaver
with questions about this memo.



 -Evaluating Investments Memo Concluded-
Kara Paxton, City Clerk City of Fayetteville -
Courtney Spohn, Deputy Clerk City Clerk Treasurer’s Office
479-575-8323 113 W. Mountain St.
cityclerk@fayetteville-ar.gov Fayetteville, AR 72701




May 23, 2025



Dear Pensioner or Beneficiary,


The Policemen's Pension and Relief Fund Board of Trustees has completed the 2025
Board Elections. Eldon Roberts, John Brown and Melvin Stanley have been re-
elected. Their term will begin June 1, 2025 and end May 31, 2027.


Sincerely,



Kara Paxton, MMC, CAMC
City Clerk Treasurer
Policemen’s Pension & Relief Fund
Board of Trustees Treasurer