GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM OF THE VIRGIN ISLANDS REGULAR MEETING OF THE BOARD OF TRUSTEES St. Thomas/St. Croix Thursday, October 24, 2024 9:30 am ** AGENDA ** I. Call to Order II. Roll Call III. Comments and Suggestions from Retirees IV. Comments and Suggestions from Active Members V. Secretary’s Minutes (Regular: 9/26/2024) VI. Communications and Correspondences VII. Chairperson’s Report VIII. Administrator’s Report IX. Committee Reports X. Treasurer’s Report XI. Investment Officer’s Report XII. REGULAR SESSION A. New Business (i). Consideration of Amendment to Advance Restoration Services, Inc. contract to repair western flat roof at GERS St. Thomas Complex XIII. EXECUTIVE SESSION This portion of the meeting will be closed to the public for matters pertaining to trade secrets / or financial or commercial information/ or personal/ or legal matters; or matters whose premature disclosure will frustrate the implementation of the proposed agency action. A. New Business (i). Medical Review Committee Recommendations XIV. Privileges of the Floor XV. Adjournment GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 1 The Regular Meeting of the Board of Trustees was called to order at 9:44 a.m. At roll call, Trustees present were Nellon Bowry, Andre’ T. Dorsey, Vincent G. Liger, and Dwane Callwood. The meeting was held in person and via Zoom. Trustees not present during roll call were Ex-Officio Cindy L. Richardson, Ronald E. Russell (absent) Leona E. Smith (excused). A quorum was established with 4 voting Trustees present. Staff in attendance: Angel E. Dawson, Administrator/CEO, Ishmael A. Meyers Jr., General Counsel, Asiah Clendinen Gumbs, Senior Deputy Administrator, Michele Nico, Deputy Administrator, Glenville Henderson, Investment Analysts, Jahmed Mills, Director of Retail, Dining, and Entertainment/Property Manager – Havensight, Roy Moorehead, Assistant Property Manager / Chief of Security – Havensight, Dannica Thomas, Director, Communications, Engagement & Organizational Effectiveness, Ucilla Austrie, Co-Director of Accounting and Finance Division/Accounting Coordinator, Ms. Jerain Fleming, Executive Assistant to the Administrator, LeSean Moses, Computer and Benefits Systems Technician, IT, Nikia Coley, Administrative Assistant to the Board, Zaida M. Castro, Legal Secretary to the General Counsel, Also, present at the meeting were Pedro K. Williams, Board Counsel, Kelsha Williams from Law Offices of Williams and Williams, Ms. Desiree Hill, Stenographer and Ms. Valcina Quashie, Deputy Director for Division of Personnel representing Ex-Officio Richardson. Comments and Suggestions from Retirees None Comments and Suggestions from Active Members None Secretary’s Minutes (Regular 09/26/2024) A motion was made by Trustee Bowry to accept the minutes of September 26, 2024, and seconded by Trustee Dorsey. The motion passed with Yes 3 (Bowry, Dorsey, and Callwood), 2 absent (Russell & Smith) and 1 not voting (Liger). Communication and Correspondences None Chairman’s Report On October 2, 2024, Chairman Callwood along with Administrator Dawson, met with Governor Bryan and his Financial team members to discuss the three (3) percentage points increase in employer contributions. A motion to increase the Employer Contributions to 26.5% effective GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 2 January 1, 2025, was adopted at the September 26th Board meeting. On October 11th, Chairman Callwood, Mr. Shawn Miller (hotel developer), and Administrator Dawson took a tour of the hotel development at Havensight Mall. The Administrator’s Office will coordinate future tours, which will also be available to other members of the Board. Trustee Dorsey requested an update on the outcome of the discussion with the Chairman and Governor Bryan regarding the increase in employer contributions. Chairman Callwood presented the cash flow presentation shared by the Actuary at the Board Retreat to Governor Bryan and his team and reiterated that the System could still be insolvent. The Governor’s team is looking at potential pockets of funding to address the issue of insolvency. Administrator’s Report Meetings, Presentations, and Appearances September 26 Board Meeting October 2 Meeting with Governor Bryan re: 3 percentage point increase October 3 Meeting with member re. retirement qualification October 4 Vitech Statement of Work Review October 9 Meeting with member re: Retirement qualification October 9 Meeting with Havensight tenant October 10 Panelist at the Governor’s Workforce Summit 2024 October 11 Havensight Greenspace Review October 11 Havensight Hotel Site visit with Chairman October 11 Meeting with Havensight tenant October 15 Attended Port Authority Public Hearing on Fee Increases October 17 Prep Meeting – “Friday Night at Havensight” October 18 “Friday Night at Havensight” GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 3 Member Services Retirement Applications - as of October 15, 2024 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Total STX 147 111 118 177 143 114 165 142 135 115 1 STT 147 164 127 224 172 126 178 184 158 126 0 Total 294 275 245 401 315 240 343 326 293 241 1 Processed 293 275 245 401 315 240 343 324 281 102 0 Remaining 1 0 0 0 0 0 0 2 12 139 1 155* % Completed 99% 100% 100% 100% 100% 100% 100% 99% 96% 42% 0% Contributions Processing-Refunds and Death Benefits October 1, 2023 – September 30, 2024 Refunds No. of Cases Completed Total Amount # Cases Pending Regular 409 $6,904,871.49 37 Erroneous 19 19,721.59 3 Employer Share 17 118,155.15 1 Overpayment 265 712,405.77 3 Total 710 $7,755,154.00 44 Death Benefits No. of Cases Completed Total Amount # Cases Pending Active 44 $ 2,221,095.28 36 Retired 8 271,837.22 25 Total 52 $ 2,492,932.50 61 GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 4 Accounting Department Annuity Payments No. of retirees as of October 15, 2024, payroll: 8771 Cumulative dollar paid out from October 1, 2024 – October 15, 2024 700 Pensioners $0.00 702 Service Retirement Annuities 11,006,716.12 703 Survivors' Annuities 73,073.64 704 Duty-Connected Death Annuities 106.81 705 Duty-Connected Disability Annuities 131,615.39 706 Non-Duty Disability Annuities 66,820.10 Totals 11,278,332.06 Number of retirees added to payroll from October 1, 2024 – October 15, 2024. 15 Number of retirees added to the payroll for the October 15, 2024, pay date. 15 Number of retirees expected to be placed on payroll for October 31, 2024, pay date: 5 Number of retirees deleted from payroll from October 1, 2024, through October 15, 2024: 14 Note: As of 10/15/24 payroll, the Gross Retiree Payroll has arrived at $ 11,278,332.06 Disbursement by Location as of 10/15/2024 Location Total Count Total Checks Total ACH Puerto Rico & Other islands 68 9 59 United States 1688 27 1661 International 6 2 4 1762 38 1724 St. Thomas 4094 77 4019 St. Croix 3494 50 3444 St. John 228 5 223 7816 132 7686 Total disb. 9578 170 9410 GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 5 GOVERNMENT EMPLOYEES' RETIREMENT SYSTEM LOAN PORTFOLIO UNITS 9/30/2024 PERSONAL LOANS Total STT/STJ STX Active Personal Loans 2193 1093 1100 Retiree Personal Loans 256 142 114 Total Active Loans 2449 1235 1214 MORTGAGES Construction/Home Improvement 19 11 8 Land 21 18 3 Purchase/Refinance 27 20 7 Totals 67 49 18 TOTAL LOANS & MORTGAGES 2,516 1,284 1,232 TOTAL OUTSTANDING SEPTEMBER 2024 Total STT/STJ STX Active PL - $ 19,834,146.04 $ 9,903,757.84 $ 9,930,388.20 Retiree PL - 828,138.36 370,735.87 457,402.49 Purchase/Refi - 1,159,470.06 834,691.38 324,778.68 Construction - 1,572,145.89 915,422.64 656,723.25 Land Loans - 337,889.34 321,818.25 16,071.09 GRAND TOTAL $ 23,731,789.69 $ 12,346,425.98 $ 11,385,363.71 GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 6 Operations St. Croix Office Complex BUILDING: CASINO COMMISSION CONTROL BUILDING: Building needs to be repaired and painted. MAINTENANCE: HVAC SYSTEMS: RTU #4 and #5 to be replaced (approximately $15K each). St. Thomas Office Complex BUILDING: • Southern Flat Roof renovation - 90% complete. o Asphalt – 90% completed • Western Roof to be replaced. Havensight Mall Hotel Development The hotel project is 70% complete GENERATORS Update- IMPORT SUPPLY • Build a new Concrete pad and enclosure (100% Work Complete) • Manufacture vent and ducts (50% complete) GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 7 Rental Collection Office Buildings Rental and Electricity Collections – Exhibit A (below) September 2024 Total FYTD Arrearages Rental $241,813.74 $1,098,927.32 $45,819.08 Electric $162,496.81 $512,012.69 $58,183.98 Total $404,310.55 $1,610,940.01 $104,003.06 Leases Department of Justice - On September 19, 2024, Mr. Dawson met with the Attorney General (AG). The AG will review the lease. RENTAL – EXHIBIT A GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 8 Quality and Control Below is the total number of employees per Agency for September 2024. EEMC, RLSHMC, VIHFA and VIPFA have outstanding contributions. Ms. Valcina Quashie, Deputy Director for Division of Personnel reported that the Division of Personnel is up to date with rental and paid on October 8, 2024. Administrator Dawson clarified with Trustee Dorsey that the October 4th meeting was a regular discussion of the Scope of Work with VITECH regarding the migration from V3 to V10. Trustee Dorsey requested an update on the green space, and Administrator Dawson confirmed it is progressing well. Committee Reports. (a) Investment Committee – Chairman Callwood – No Report (b) Development Committee – Trustee Leona E. Smith – No Report (c) Budget/Audit Committee Report – Chairman Callwood – No Report (d) Policy Committee Report- Trustee Bowry – No Report (e) Havensight Management Oversight Committee – No Report GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 9 Treasurer’s Report Ucilla Austrie, Co-Director of Accounting and Finance Division/Accounting Coordinator, read the Treasurer’s Report for the System and Havensight Mall for the month ending of September 30, 2024 Total Collections for September 30, 2024, is $13M and FYTD is $291M. Total Disbursements for September 30, 2024, is $25M and FYTD is $319M; Net Cash deficit is $12M a Net Cash Deficit for FYTD of $29M Havensight Mall. Total Collections for September 30, 2024, was $413K and FYTD $5M; Total Disbursements was $300K and FYTD is $6M and a Net Cash surplus of $113K and Net Cash deficit of $290K FYTD. Ms. Austrie pointed out that 66% of the spending of the budget was due to the migration activities of the V3 system. Also, out of the $144M drawdown, $20M consists of the funding of the Loan Program. It was also clarified that the lease payments from the hotel (Haven Development L.L.C.) will occur following the hotel’s opening. A motion was made by Trustee Dorsey and seconded by Trustee Bowry to accept the Treasurer’s Report for September 30, 2024. The motion passed with 4 Yes (Bowry, Dorsey, Liger, and Callwood) and 2 Absent (Russell and Smith). Investment Officer’s Report Mr. Glenville Henderson read the investment report for the month ending September 30, 2024 No funds raised for the month ending September 30th. Total Plan returned 1.7% for the month (includes local investments and not Loans and St. Thomas and St. Croix facilities). Total Domestic Equity returned 2.1 % for the month. Total International Equity returned 2.6 % for the month o Develop Market Equity returned is 1.0% o Emerging Market Equity returned 6.6% o Total Domestic Fix Income Return 1.5% GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 10 o Investment Grade Bonds returned 1.3% o TIPS returned 1.5% o High Yield Bonds returned 1.6% o Cash Returned 0.4% Total Alternatives returned 0.0% for the month A motion was made by Trustee Dorsey and seconded by Trustee Bowry to accept the Investment Officer’s Report for September 30, 2024. The motion passed with 4 Yes (Bowry, Dorsey, Liger, Callwood) and 2 Absent (Russell and Smith) Regular Session A. New Business (i). Consideration of Amendment to Advance Restoration Services, Inc. contracts to repair western flat roof at GERS St. Thomas Complex Senior Deputy Administrator Clendinen Gumbs took the lead in enlightening the Board on this topic with permission granted by the Chairman. The request is a proposed amendment to the contract with Advance Restoration Services (ARS). The amendment aims to address environmental hazards from pinhole leaks and soft spots on the Western Roof, impacting the Division of Personnel. These issues were found after work started on the southern roof. The agency’s engineering firm, Jaredian Design Group, has approved the amendment to avoid additional remobilization costs. The scope includes a 20-year warranty, with the Western Roof costing $64,000. The amended cost of the ARS contract is still below the original budgeted amount for roof repair. A motion was made by Trustee Dorsey and seconded by Trustee Bowry to approve the Advance Restoration Services, Inc. contract to repair the western flat roof at GERS St. Thomas Complex. The motion passed with 4 Yes (Bowry, Dorsey, Liger, and Callwood) and 2 Absent (Russell and Smith). Administrator Dawson informed the Board of Trustees that at the September 13th Staff meeting, it was announced the promotion of Attorney Ishmael Meyers Jr. to General Counsel. Attorney Meyers was also given formal written notice of his promotion. Executive Session This portion of the meeting will be closed to the public for matters pertaining to trade secrets or financial or commercial information or personal or legal matters; or matters whose premature disclosure will frustrate the implementation of the proposed agency action. GOVERNMENT EMPLOYEES’ RETIREMENT SYSTEM MINUTES BOARD OF TRUSTEES REGULAR MEETING October 24, 2024 11 A motion was made by Trustee Bowry and seconded by Trustee Liger to enter Executive Session. The motion passed with 4 Yes (Bowry, Dorsey, Liger, and Callwood) and 2 Absent (Russell and Smith). A motion was made by Trustee Bowry and seconded by Trustee Dorsey to come out of Executive Session. The motion passed with 4 Yes (Bowry, Dorsey, Liger, and Callwood) and 2 Absent (Russell and Smith). Regular Session The chairman reported out of Executive Session that the Board discussed medical committee matters and security concerns of GERS property. Privileges on the Floor NA Adjournment A motion was made by Trustee Dorsey and seconded by Trustee Bowry to adjourn. The motion passed with 4 Yes (Bowry, Dorsey, Liger, and Callwood) and 2 Absent (Russell and Smith). The meeting ended at approximately 11:09a.m.