BOARD OF TRUSTEES
A regular meeting of the Peninsula Endowment board of Trustees was held in the Community room of the Northern California Unit of RFB&D, 2445 Faber Place, Palo Alto on November 23, 2010. The meeting was called to order by President Westman at 11 am.
Present: Mmes. Bitting, Dunham, Tedrow and Westman; Messrs. Fowler, Hamel, Kohler and Waud
President Westman announced a slate of officers to be voted on at the February annual meeting. It will include President-Anne Dunham, Treasurer-Jo Ann Bitting, Secretary-Virginia Tedrow, Members-at Large-Fowler, Kohler & Waud. She noted it would be useful to add several additional trustees to the PE board and asked for suggestions prior to the next meeting.
Minutes of the meeting held August 30, 2010 were approved.
Joe Milam, head of Legacy Capital Management presented the PE portfolio review and expounded on Legacy’s investment strategy, its use of the Holt research data base. He circulated a three year and ten year performance history comparison of the portfolio and S&P 500, detailing the growth of $100 through 10/31/10, noting the advantage of the Legacy–managed portfolio. The fragility of the economy, the concern that the emerging markets may contain a bubble as in “07 make forecasting harder than it has ever been before.
Following Milam’s departure, Trustees agreed that the greatly increased value of the portfolio required revisiting its management cost. Mrs. Bitting reported that the Investment-Sub-Committee had interviewed five groups which Legacy could be compared to. Three had higher risks and fees, leaving Schwab and Vanguard for consideration.
Mrs. Bitting and Mr. Kohler met in person with local representatives from Schwab and on a conference call with representatives from Vanguard. Both institutions have roughly the same cost structure, with Vanguard’s being somewhat lower; otherwise both seemed to provide fairly similar services. Because some members of the sub-Ccommittee had personal experience with Vanguard’s reporting features and found them to be thorough, timely and always accessible online, it gave Vanguard the slight edge. It was stressed once again that sub-committee members were not predisposed to replacing Legacy and they were generally satisfied with services they had provided to date. It was felt, however, that with our larger investment portfolio and with the many new investment vehicles that have become commonplace in the past several years, that our fiduciary responsibilities called for a review of our investment management options.
It was decided that after the sub-committee finished its comparison of Legacy and Vanguard it would return with a report to the full board.
Treasurer Hamel reported the total value of the Endowment’s portfolio was $3,404,448 on 11/22/2010; 74% of the Endowment assets are in cash, 15% in bond funds, 10% is in transition from cash to stocks following recent trades. Federal and state tax returns for the last fiscal year were completed, signed and filed on 9/17/2010. The check register and most recent Schwab statement were offered for review. President Westman commended Hamel for his decade of zealous and meticulous work as Treasurer.
NCU Board Chair Kohler reported an eventful fall which included
• A first time Dream Builders Brunch which drew 68 guests and raised$76,780 in donations and pledges.
• Learning –Through-Listening tours of the studio continue to be well attended and are an effective way of reaching the public.
• Plans are being made for a First Anniversary Celebration of the new studio to be held December 14.
• The 2011 Record-a-Thon will be held February 28-March 5. Let Trish know your suggestions for possible sponsors.
• Kohler described the effort to help one or more of the 53 schools who have not renewed school membership due to tight budgets. A studio campaign will begin December 1; all are invited to join.
As her long term as President of the Endowment board nears an end Hamel led Trustees in expressing their admiration, appreciation and affection for Mrs. Westman. In recognition of her founding of NCU and continuing service to the Endowment he presented her with a plaque
featuring the well used gavel and the door knob retrieved from the old studio before its demolition. The plaque is now displayed in the newly christened Ray C. Westman Community Room.
Refreshments and good cheer concluded the meeting at 1:15 pm.
Virginia Tedrow, Secretary