RETIREMENT BOARD MEETING 1. Opening of Meeting.  May 19,2022  2. Approval of Minute No. 286 dated February 17, 2022.  3. Public Comment. 4. Treasurer's Report:  Bank Reconciliations - December 2021.  5. Requisitions:  Requisitions - February 2022-April 2022.  6.Old Business. 7. New Business:  A. Approval ofai request from Robert Lonick to purchase prior service time dated December 17, 1998 to. July 20, 1999 and September 7,2004 to November 8,  2004 in the amount of $2,848.32.  B. Portfolio Presentation: Lee Martin, Ph.D. - Marquette Associates.  8. Adjournment.    Minute No. 286  February 17, ,2022  The quarterly meeting of the Washington County Retirement Board was held at approximately 3:00 p.m. on' Thursday, Februarey 17,2022, in the public meeting room with the following members being present: Commissioners Diana Irey Vaughan, Larry Maggi and Nick Sherman; Treasurer Tom Flickinger. Also present: Finance Director Joshua Hatfield; County Solicitor Jana Grimm; Chief Clerk Cindy Griffin; Secretary Paula. Jansante; Executive Assistant Marie Trossman; Chief of Staff Michael Namie; and Lee Martin, Ph.D. representing Marquette  Associates. Approval of Minutes be approved as written. No discussion followed. Roll call vote taken: Motion passed Public Comment None. Treasurer's Report statements.  Mrs. Vaughan entertained a motion to approve Minute No. 285 dated December 1,2021.The motion was moved by Mr. Sherman and seconded by Mr. Maggi that the above-mentioned minutes  Mr. Flickinger - yes; Mr. Maggi -yes; Mr.  Mrs. Vaughan-yes.  unanimously.  4  Mr. Flickinger prèsented theBank Reconciliations: for November 2021. It was moved by Mr. Flickinger and seconded by.M. Sherman.to accept ther reconciliations of the above-mentioned Mrs. Vaughn paused toi note thel lackofDecember and January and Mr. Flickinger responded that  neither monthis not completed. Roll callvote taken: Motion passed unanimously. Retirement Allowance Report  Mr. Flickinger- yes; Mr. Maggi - yes; Mr. Sherman yes; Mrs. Vaughan - yes.  Bank Balance as of November 1, 2021 Deposits to Checking Account Transfers In Add: ACH Credit Less: Cancelled Checks Less: ACHI Debits Bank Balance as ofl November 30, 2021 Less: Outstanding Checks Less: Retirement Check Run  $293,491.85 -0- 671,704.45 289,210.23 (289,783.57) (862,598.09) $102,024.87 (68,991.68) (33,033.19) $-0-  Reconciled Balance as ofl November 30, 2021    Requisitions totaled $2,374,023.52 approved.  Mr. Flickinger stated that requisitions for the months ofDecember 2021 and. January 2022 It was moved by Mr. Flickinger and seconded by Mr. Sherman that the requisitions be  No discussion followed. Roll call vote taken: Motion passed unanimously.  Mr. Flickinger - yes; Mr. Maggi - yes; Mr. Sherman yes; Mrs. Vaughan - yes.  Distributions  December2021 Payee Solomon Armstead John Edgehill-Haynes Leann Howell Shawn-Myers Justice Ottey-Jones Kelli Stein  Check 2283 2284 2285 2286 2287 2288 2289 2290 2291 2292 Transfer Transfer  Amount 1,479.07 600.14 10,795.33 11,000.00 323.93 1,099.35 ,886.06 24,13.42 60,176.92 62,727.32 825,234.80 1,057,569.70  National Slovak Societyastrustee ofl Patricia Ashcrom  National Financial Seryices LLCast trustée of RAofLeeann Howell 3,112.3  WashingtonCounty Regular Payroll Escrow Account Washington County Cash Disbursement Account Washington Co Retirement Account Total December 2022 Distributions  PNC Bank    January 2022 Payee  Check 2294 2295 2296 2297 2298 2299 2300 2301 2302 2303 2304 2305 2306 2393 2307 Transfer Transfer  Amount 530.58 21,702.92 21,702.92 21,702.92 21,702.92 56.79 1,761.87 12,047.61 15,870.11 16,690.97 15,021.85 160,608.65 25,019.26 19,487.90 9.51 123,952.93 838,584.13 1,316,453.82  Estate of Elizabeth Carol Shawley Robin. Joyce Amos Michael L Garber Walter W Garber William R Garber Jr Dustin Vandivner Joyelle Carter Kimberly Al Furmanek  Stifel As Trustee ifIRAf.Michael Anthony Ierino GBUI Finacial Life as' TrusteeofIRA, sara A Sici  Tina Landis James Lipniskis  Washingten County Regular PayrollEscrow: Acçount WashingtonCounty CDsbunemantAccount Washington Co. Cash) Disbursemnet Acct Washington Co. Retirment. Acct Total January 2022 Distributions  PNCBank  Old Business None. New Business Fund budget. be approved. Roll call vote taken:  Mrs. Vaughan entertained. a motion to approve the 2022 Washington County Retirement It was moved by Mr. Sherman and seconded by Mr. Maggi that the above-mentioned budget  No discussion followed.    Mr. Flickinger yes; Mr. Maggi . yes; Mr. Sherman yes; Mrs. Vaughan -yes. Mrs. Vaughn entertained. ai motion to approve of the purchase ofl Employee Benefit Statements from Korn] Ferry at a cost of$ $1.85 per statement for a total approximate cost of$1337.55. It was moved by Mr. Sherman and seconded by Mr. Maggi that the above-mentioned  Motion passed unanimously.  The cost per statement remains unchanged from 2021.  purchase be approved. Roll call vote taken:  No discussion followed.  Mr. Flickinger- - yes; Mr. Maggi - yes; Mr. Sherman yes; Mrs. Vaughan -yes.  Motion passed unanimously.  Mrs. Vaughn entertained ar motion to approve a request from Natalie Mazza toj purchase prior It was moved by Mr. Sherman ands secondedbyMr. Maggi thatthe above-mentioned request  service time dated August 5, 2002 to. July 24,2004 in theamountofs2.065.96.  be approved. No discussion followed. Roll call vote taken: Motion passed unanimously.  Mr. Flickinger- yes; Mr. Maggi-yes: Mr. Sherman-yes; Mrs. Vaughan -yes.  Portfolio Presentation-Lee) Martin,Ph.D.-N MarquetteAssociates  Mrs. Vaughan movedon tot thel Investment Policy Update introducing Lee Martin ofl Marquette Associates to briefly explainthe updatet to the Investment Policy Statement (IPS). Mr. Martin quickly notedt thathewill soon be meetingt the new controller, April Sloane, and that two new partners were Mr. Martinbegan the discussion withp presentation of thel End of Year report. He stated that Washington Countyh had a strong year. Hej pointed out that four out of the past five years had produced mid-teen returns so thereare al lot of gains tol help! protect in the current strained environment. Mr. Martin wentoyer the market environment and pointed out that GDP did retreati in the third quarter but accelerated int the fourth quarter. Consumer spending drives about 2/3 ofthe GDP economy in the US. He noted that inventory accumulation, where businesses start tol build out inventory, is a creed oft the GDP. Mrs. Vaughn asked Mr. Martin ifhe'ss seen that people are really investing in remodel projects. Mr. Martin responded that there's been an awful amount and he will address iti ini inflation. He went ont that business investment is expected to continue through 2022 due tot the need tol build business inventory back. He state that the hopei is people will continue tos spend because thati is what drives our economy and the. January numbers have come out and, even with inflation, people are continuing to spend. Mrs. Vaughn asked if people are saving less or are they saving same, to which Mr. Martin responded that they have more money saved because oft the stimulus and the aide from the last couple of years. Which ledt to his next point ofi inflation.  added to the business: Laurenand) Amy    Mr. Martin notedt the problems with global supply chains, particularly in the US. Additionally, trucker strikes and lockdowns in China are making itr more and more difficult to move goods, which Moving on tos sticky inflation, particularly ini real estate, Mr. Martin stated that 181 months ago pointed to the end of the real estate market, and asi its sits now, it's probably up over 20%t this year. Everything is lifted int the real asset world, and the same with! home prices. Thisi is starting to affect the cost of renting. There needs tol be al bigs spurt ofr new builds, because therei isn't enough housing. Fors some people, it would actually be cheaper to pay a mortgage than to rent. Mr. Flickinger asks what the impact oft the bond and equity market will be, pointing out that the Federal Government is raising the interest rate and inflation is still rising. Mr. Martin answers this by saying pressure is on equities, andt the bond market is down this year. Aggregate Bonds are already down four percent this year. The Federal Government plans tol have six or more 25 basis point rate hikes over the next two years, beginning inl March. There has also been some talk of the Federal Government kicking March off with a 501 basis point increase inl Marcht to combati inflation  buti its seems unlikely. Finally, Mr. Martin moves ont to the global economy. He stated that, in the developed world, inflation is a problem everywhere, but not asl high ashere int the US. Hègoes ont to state that the one exception is China right now. Mr. Martin recalls that last year, China reallydragged down the emerging markets because of the tech regulations andthei issues they had withinther real estate markets. Hej pointed tos speaking about that over the summer. Mr Martin goes ont toexplain that where everyone. hass started to tighten ratei increases, China! hasactually gone the opposite way and has actually stated to stimulate their economy, andhave loweredrates. Which is why Chinal has Transitioning to indexes, MrMartin pointsout that US stocks Jead the way in 2021, up 25 percent mainly driven by grave stocks. However,so far this year, the grave stocks and tech stocks have been pummeled. The good newsi isthat we don'thave muchi int those stocks. Emérging markets were negative last year,because emérging markets follow China. Moving forward, bonds were: flat for the quarter. Ini real terms,withi inflation sol high,fixedi income returns were actually were negative. Absolute returns in 2022 are negative. We have, however, benefitted from high-yield bonds, as they arep over 5%1 forthe year. Mr. Martin continues by saying that the real story pertains tot thei inflation-sensitive assets. TIPS is up 2.4% andj public real estatei is up 41%1 for the year. Private markets tend toi follow public markets by about 121 to 18 months, whichi is why private real estate Mr. Martint then reflects on the County's performance. We ended the year atj just over $213 million, gaining about $10 million int the fourth quarter. As of now we are down to about $208 million. Our high quality equities are really performing well. Defensive equity added about 5%0 of over pertormance last year over its bench! because people were buying stock options asi insurance. The County put private equity andj private credit in at the right time last year, as equities are going Over fives years, which ist the most important benchmark, is the assumed rate of return, whichi is 6.5%. During this time period, wel have handedly out performed that posting a return of 10.2%. Four out of our last five years, wel have had al high double digit percentage return. We have al lot of gains which could come inl handy because we expect a few tough years ahead, likely beginning this  subsequently has catalyzed inflation  leads the equity markets sof far in 2022  returns are starting toi mimic what we sawi inj publicr markets last year.  down, therefore we expect to see private equity and credits toi increase.  year.    Moving forward, Mr. Martin elaborates on some changes made in the fourth quarter. We switched out the low volatility manager tol MFS, the one that we' 've seen in OPEB for years. MFSis Marquette'sr number one low volatility manager. Also, in the defensive equity, we split it between Parametric and Newburger. This should yield more premium. Mr. Martin summarizes that the diversity in our portfolio has really set us up well for the likely tough upcoming years.  After some discussion withi regardt toj percentages allocated toj private equity and public equity, Mrs. Vaughan entertained a motion to move 2% of public equity toj private equity. It was moved by Mr. Flickenger to move 2% of public equity to private equity. Mr. Maggi seconded the  motion.  No discussion followed. Roll call vote taken:  Mr. Flickinger- -yes; Mr. Maggi - yes; Mr. Sherman yes: Mrs. Vaughan yes.  Motion passed unanimously.  After additional discussion, Mrs. Vaughan entertained a motion tomove 1%1 from fixed income toj private credit. It was moved by Mr. Flickenger to move 1% from fixed income to private  credit. Mr. Maggi seconded the motion. No discussion followed. Roll call vote taken:  Mr. Flickinger yes:-MrMaggi -yes,Mr. Sherman-yes; Mrs. Vaughan yes.  Motion passed unanimously;  Moving on tot the managers, Mr. Martin statedt that U.S. equities are up 10.2 basis points relativeto9:3 for the bench. Twin Capital Dividend Select, the local large cap defensive manager is over 1%inJanuary, as expected int thisenyironment. GW&K Small-Mid Cap Core has gone up nearly 4.5% every year. On the global side, Mr. Martin noted we did lag by about 170 basis points for the fourth quarter, which was recouped in. January. Artisan, Dodge & Cox Global Stock, Alliance Bernstein, and MFS Global Low Volatility aidedi in this. Turning to the Non-U.S. Equity Composite, we outperformed by about 301 basis points in the quarter and 2% in. January, thanks to Schroder International Multi-Cap Equity Trust. Also, we added two new managers: one in the emerging markets, Wellington. Additionally, we added Harding Loevner International to give us some small cap exposure overseas. Moving to the Defensive Equity Composite, we are up about 5.9%, about 40 above the base. The Real Estate Composite brought in 22.0% last year. Since April of last year, TA Realty Core Fund returned 27% which is 10% above the index. Mr. Martin also noted that TimberlandFarland returned 7%, and Infrastructure had a great year bringing in 6% for the year. He noted that Private Credit Composite delivered 2.5% for the year. Also, Private Equity was up 4.3% for the fourth quarter. Finally, Mr. Martin announced that there would be some fee reductions  coming up with MFS Global.  The meeting was adjourned at 3:29p p.m.    THE FOREGOING MINUTES SUBMITTED FOR APPROVAL:  2022  ATTEST: