LCEC Retirement Plan Oversight and Performance Update March 17, - - PowerPoint PPT Presentation

SLIDE 1

LCEC Retirement Plan Oversight and Performance Update

March 17, 2016

SLIDE 2

Retirement Plan Structure

• LCEC provides two types of retirement benefits under two

separate plans:

• Defined Benefits
• Traditional Plan
• Cash Balance Plan
• 401(k)
• Retirement plan policies have been developed to ensure

proper oversight is in place

SLIDE 3

Retirement Plan Oversight

Investment Committee

• Designated members of

Executive Steering Committee, Board counsel, Internal Audit, Human Resources

• Meets quarterly
• Has engaged the services of an

investment consultant (w/ Morgan Stanley) to assist in fulfillment of responsibilities and to provide independent expertise and opinion on plan management (John Hancock Retirement Plan Services) and performance Responsibilities

• Establish and review investment
• bjectives, policies, amendments,

and guidelines

• Review performance of plans and

plan components

• Periodically report results
• verview to Board of Trustees

SLIDE 4

Retirement Plan Performance Update

• Following slides are excerpts from the most recent

quarterly report prepared for and reviewed by the Investment Committee

• Report based on 4Q 2015 results

SLIDE 5

SLIDE 6

SLIDE 7

SLIDE 8

SLIDE 9

SLIDE 10

SLIDE 11

SLIDE 12

SLIDE 13

SLIDE 14

SLIDE 15

401(k) Fund Performance

LCEC Fund 2015 LCEC Fund 1-Year Performance 2015 Benchmark 1-Year Performance Benchmark

JP Morgan SmartRet Income I

• 1.01%
• 1.75%

Morningstar Retirement Income JP Morgan SmartRet Income 2015 I

• 0.91%
• 1.39%

Morningstar Target Date 2011-2015 JP Morgan SmartRet Income 2020 I

• 0.76%
• 1.60%

Morningstar Target Date 2016-2020 JP Morgan SmartRet Income 2025 I

• 0.94%
• 1.59%

Morningstar Target Date 2021-2025 JP Morgan SmartRet Income 2030 I

• 1.31%
• 1.81%

Morningstar Target Date 2026-2030 JP Morgan SmartRet Income 2035 I

• 1.50%
• 1.74%

Morningstar Target Date 2031-2035 JP Morgan SmartRet Income 2040 I

• 1.65%
• 1.98%

Morningstar Target Date 2036-2040 JP Morgan SmartRet Income 2045 I

• 1.55%
• 1.81%

Morningstar Target Date 2041-2045 JP Morgan SmartRet Income 2050 I

• 1.56%
• 1.97%

Morningstar Target Date 2046-2050 JP Morgan SmartRet Income 2055 I

• 1.61%
• 1.62%

Morningstar Target Date 2051-2055 MainStay Large Cap Growth I

6.17% 5.67%

Russell 1000 Growth MainStay ICAP Select Equity I

• 3.98%
• 3.83%

Russell 1000 Value Columbia Large Cap Index Z

1.23% 1.38%

S&P 500

• T. Rowe Price Mid Cap Growth Adv

6.28%

• 0.20%

Russell Mid Cap Growth Vanguard Extended Market Index

• 3.27%
• 3.35%

S&P Completion Index Artesan Mid Cap Value Investor

• 9.68%
• 4.78%

Russell Mid Cap Value ClearBridge Small Cap Growth A

• 4.50%
• 1.38%

Russell 2000 Growth Perkins Small Cap Value S

• 2.86%
• 7.47%

Russell 2000 Value Oppenheimer International Growth Y

3.44% 4.47%

MSCI EAFE Growth Harbor International Inv

• 3.82%
• 0.39%

MSCI EAFE Lazard Emerging Markets Equity Open

• 20.16%
• 14.60%

MSCI EM (Emerging Markets) Oakmark International I

• 3.83%
• 5.22%

MSCI EAFE Value Vanguard Total International Stock I ndex

• 4.26%
• 4.03%

FTSE Globall All Cap Ex US Index Nuveen Real Estate Secs I

3.48% 2.83%

FTSE Nareit Equity-Reits BlackRock Natural Resources Inst

• 24.32%
• 24.28%

S&P North America Natural Resources Sect Index PIMCO Real Return Instl

• 2.75%
• 1.44%

Barclays Capital U.S. Treasury - U.S. TIPS Vangard Short Term Bond Index

• 0.92%
• 0.97%

Merrill Lynch Domestic Master, 1-3 yrs. Metropolitan West Total Return I

• 0.29%
• 0.55%

Barclays Capital U.S. Aggregate PIMCO Money Market Admin

0.02% 0.03%

CitiGroup 3-month Treasury Bill

SLIDE 16

SLIDE 17

SLIDE 18

SLIDE 19

Noted Items for 2015

• Made contributions of $8,533,944 to Defined Benefit Plan
• Distributed assets of $1,195,385 from Defined Benefit Plan
• Rebalanced to Target on Defined Benefit Plan in February, May,

and July

• New York Life sell to John Hancock Retirement Plan Services

completed in June

• Distributed Employee Total Compensation and Benefits

Statements

• Auto enrollment in 401(k) continues to be successful

SLIDE 20

Noted Items for 2015

Defined Benefit

Class New Defined Benefit Funds Removed Defined Benefit Funds

International Equity Vanguard Developed Markets IDX Admiral (VTMGX) Harbor International Investor (HIINX) HEDGE/ALT/World Alloc. PIMCO All Asset All Authority (PAUIX) REITS Voya Global Real Estate A (IGLAX)

Defined Contribution – 401(k)

Fund Class New Defined Contribution Funds Removed Defined Contribution Funds

Mid-Cap Equity Artisan Mid Cap Value (Investor Shares - ARTQX) Artisan Mid Cap Value Fund (Institutional Class - APHQX) International Equity Harbor International Fund (Investor Class - HIINX) Harbor International fund (Institutional Class - HAINX) Emerging Market Equity Lazard Emerging Markets Equity Portfolio ( Open Shares - LZOEX) Lazard Emerging Markets Equity Portfolio (Institutional Shares - LZEMX) Small Cap Equity ClearBridge Small Cap Growth Fund (Class A - SASMX) ClearBridge Small Cap Growth Fund (Class I - SBPYX) Fixed Income Vanguard Short-Term Bond Index Fund (Investor Shares - VBISX) Vanguard Short-Term Bond Index Fund (Admiral Shares - VBIRX)

SLIDE 21

Current Issues

• Monitor interest rates
• Continue to watch funding levels of defined benefit plan

in light of distributions and MAP

• Consider automatic employee contribution increase for

401(k)

• Focus on employee education on saving for retirement

SLIDE 22

Questions