PERAC Approval Date: August 27, 2009
Investment/Supplemental Regulation
Notwithstanding the provisions of the Public Employee Retirement Administration Commission regulations, the Methuen Retirement Board may invest funds of the Methuen Retirement System (the “System”) in the fund known as RREEF America REIT II, Inc. (the “Fund”), and effective retroactively as of the date of the initial investment by the System of any of its assets in the Fund, while the assets of the System are so invested, the assets of the System shall be deemed to include, for purposes of applying the rules set forth in 840 CMR 16.00 et seq., 17.00 et seq., and 840 CMR 21.01, the System’s interest in the Fund but not any of the underlying assets of the Fund; provided that, at all times, the Fund qualifies as “real estate operating company” within the meaning of Employee Retirement Income Security Act of 1974, as amended and the regulations promulgated thereunder.
PERAC Approval Date: August 2, 2006
Investment/Supplemental Regulation
Regulation Number 21.01: The Methuen Retirement Board’s high-yield bond manager, Bradford & Marzec, is authorized to use U.S. Treasury futures and options as well as credit default swaps in limited ways to help in accomplishing the portfolio’s basic strategy.
B&M’s use of Treasury futures and options is not expected to exceed the level already authorized by Investment Guideline 99-1.
Credit default swaps have become an increasingly viable and liquid tool used by managers of corporate bonds, including high-yield bonds. The swaps would be used as an additional available tool to help protect the portfolio against deteriorating credit situations. These instruments are expected to be a small part of the total portfolio and the board’s investment consultant, Segal Advisors, is comfortable with the manager’s use of them.