CIVILIAN AND POLICE PENSION BOARDS

The Civilian and Police Pension Boards met on August 23, 2005 at 9:12 a.m. with Chairman Mullaney presiding. Members present were Mr. Ruane, Mr. Hogan, Mr. DePrima, Mr. Lucas, Mrs. Rigby, Mrs. Braun, Chief Horvath, Ret. Capt. Gray and Ret. Lt. Knotts . Others present included Mr. Szyjka.

AGENDA ADDITIONS/DELETIONS

Mr. Lucas moved for approval of the agenda, seconded by Mr. Ruane and unanimously carried.

Quarterly Investment Performance Analysis Reports - Presented by Michael Shone of Peirce Park Group

Mr. Shone of Peirce Park Group provided members the Quarterly Investment Performance Analysis, as of June 30, 2005.

GENERAL EMPLOYEES FUND

                                                                  TOTAL FUND                    POLICY INDEX

                  Quarter Return                               2.2%                                    1.7%

                  1 Year Return                                 6.5%                                    6.2%

                  3 Years Return                               4.8%                                    7.7%

                  5 Years Return                              (1.6%)                                   1.3%

                  Expense Ratio                                .29%

                  Total Assets                             $14,608,104

                  POLICE FUND

                                                                  TOTAL FUND                    POLICY INDEX

                  Quarter Return                               2.1%                                    1.7%

                  1 Year Return                                 6.2%                                    6.2%

                  3 Years Return                               4.5%                                    7.7%

                  5 Years Return                              (2.2%)                                                1.3%

                  Expense Ratio                                .29%

                  Total Assets                             $11,444,791

The second quarter of 2005 proved to be tricky for equity investors, who had to deal with uncertainty in the direction of crude oil prices, continued inflation worries, and a slowing expansion in global economies. The Federal Reserve raised the overnight Fed Funds rate in two 25 basis point increments during the quarter, bringing this key lending rate to a quarter-end 3.25%. Consumer inflation, despite higher fuel costs, was moderate in relation to the torrid pace of first quarter, with second quarter’s Consumer Price Index increasing 0.62%.

Mr. Shone provided members with a summary of the Employee and Police Fund Performances. Mr. Shone also stated that overall expense ratios have been lowered from .31% to .27% in less than a year.

Mr. Ruane clarified that the Mr. Shone was not recommending any changes to fund allocations at this time. Mr. Shone stated that he will propose a re-balancing of several accounts to bring both funds back to their targets. He indicted that there is no cost or charges to the funds for the re-balancing.

Mr. DePrima moved to approve the proposed re-balancing of funds for the Employee Fund, as recommended by Mr. Shone. This motion was seconded by Mrs. Rigby and carried unanimously.

Capt. Grey moved to approved the proposed re-balancing of fund for the Police Fund, as recommended by Mr. Shone. This motion was seconded by Lt. Knotts and carried unanimously.

The next Quarterly Investment Performance Analysis Reports will be presented to the Board in February of 2006.

Meeting Adjourned at 10:10 A.M.

Respectfully submitted,

Timothy Mullaney                                                                  Eugene Ruane

Chairman - Police Pension Board                                          Chairman - Civilian Pension Board

/hf

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