Columbus, Georgia

MINUTES OF THE

BOARD OF TRUSTEES MEETING OF THE

COLUMBUS GEORGIA EMPLOYEES' PENSION PLAN



November 3, 2004





A meeting of the Board of Trustees for the Columbus Georgia Employees? Pension

Plan was held November 3, 2004 at 2:00 P.M. in the Mayor?s Conference Room.





PRESIDING: Dan Gray, Vice Chairman and Robert Poydasheff, Chairman



PRESENT: Angela Cole, Mary Strozier-Weaver, Dan Gray, Joe Smith Alan

Rothschild, Jr., Harvey Milner, and Capt John Starkey



ABSENT: Carmen Cavezza, Morton Harris, and Jack Nowell,



GUESTS: Henry Swift, Vice President (Salomon Smith Barney), Richard

Swift, (Salomon Smith Barney), Denise Baxter (Revenue Division), Pam Hodge,

(Finance Department) and Craig Strain, (Revenue Division)











Mr. Daniel Gray, Vice Chairman called the meeting to order. The attendance was

taken by passing around the attendance and having everyone present check off

their name.







MINUTES OF THE PREVIOUS MEETING:



There were no minutes to approve due to the absence of the recording secretary

who has been on leave due to the illness of her husband.







INVESTMENT UPDATE:



Mr. Swift addressed the board with a recap of what has happened in the market

for the period from the end of June ?04 through September ?04. The market as

measured by the S&P 500 was down about 2%. The numbers are reflected in the

performance evaluation and also reflect the reason the equity manager?s

performances are down. The bond market yield dropped from 4.6% at the end of

June down to 1.4% at the end of September.



The three fixed income managers had all shortened their maturity schedule in

anticipation of the rates rising and unfortunately just the opposite happened

causing them to under perform the index.







He informed the board that a report from the sub-committee would be presented

later in the meeting giving their recommendation with respect to Synovus. This

firm has been a great concern for quite some time.



Two other firms that have been a strong disappointment are Eagle Asset

Management and Victory Asset Management. Mr. Swift stated that he has been

very disappointed in the performance of both these money managers. Eagle has

not had a single period in which they have beaten the index and Victory has

been managing money for three and a half years which is certainly plenty of

time for them to have gone through a full cycle and to show what they can do in

terms of performance. He feels the time has come to appoint a sub-committee to

review the performance of both these companies. Eagle would put under review,

simply because they have only been managing for three years. Victory would

definitely be put in the classification to replace.



National Asset Management was another money manager that was discussed. Mr.

Swift passed out a performance chart showing that from 1995 through 2000 they

out performed the index substantially. The board hired them on May 31, 2001 and

as the chart indicated they have under performed continuously to date. He

recommends that they be put under review by the investment sub-committee for

potentially replacing them or perhaps giving them until the end of this year to

see if they can perform as they have claimed.



Mayor Bob Poydasheff joined the meeting at this time. Mr. Swift did a short

summary to help bring the Mayor on board with the topics that have been

discussed thus far at the meeting. He then made his recommendation to the

Mayor to appoint an investment sub-committee to review Eagle Asset Management

and National Asset Management and to look at the possibility of finding a

replacement for Victory Asset Management.



The Mayor appointed a five man sub-committee but there were no names on the

tapes.



Mr. Swift stated that the sub-committee feels that too much time and too much

benefit of the doubt has been afforded these companies when they should really

be doing a lot better in their performance.



The Mayor stated that if there were no objections to the recommendations, then

the board should move forward with the recommendations from the sub-committee.



For the quarter the total account was down about less than ? of 1%, but with

the market being as strong as it has been since the end of the quarter, most of

that has been recovered. Even with this recovery, there is still a lot of work

to be done for the returns to hit 7.5% by next June because we are still 50

basis point behind.



Mayor Poydasheff informed the board that he had signed the contract authorizing

Lazard to move from a mutual funds account to an individually managed account.



Mr. Richard Swift presented the interim report at this time. The 10-year

Treasury Bond went from 4.175% to 4.07%, down slightly. The S&P 500, also down

slightly, showed a decrease from 1134 to 1130.



The combined fixed went from 72,400 to 72,790, an increase of .54%. The growth

managers combined went from 25,904 to 25,949, an increase of o.17%. The value

managers showed an increase of 0.04%. The core managers were up 0.37%.

Lazard, the international manager showed an increase of 2.47%. The total city

account finished at $169,314, up 47 basis points.



A copy of the evaluation reports and the other information presented to the

board is retained by the Board Secretary in the Finance Director?s Office and

is available for review upon request.







PRESENTATION:



Mr. Swift introduced Mr. Peter Miklos and Mr. Thomas L., Ellis of Evergreen

Investments to present their annual report at today?s meeting.



The report followed the Agenda listed below:



Capital Markets Overview



Economic Review/Outlook

Capital Markets Performance Summary

Fixed Income Review

Treasury Market Performance



Investment Objectives



City of Columbus Investment Policy



Portfolio Review



Portfolio Summary

Portfolio Reconciliation

Investment Performance



Fixed Income Analysis



Portfolio Review

Strategy

Bond Market Outlook



Holdings



Consolidated Holdings



Mr. Miklos and Mr. Ellis both were thanked for their presentation and with no

further questions, were dismissed from the meeting.

The Mayor asked Mr. Swift if he wanted to discuss the ?BBB? issue and Mr. Swift

responded affirmatively.



When the investment policy was formulated, there were several things that

guided it; one was that the board wanted to remain conservative and two, the

history of the Lehman Bros. Government

corporate Index has changed. What has happened is that the triple B component

of the Lehman Intermediate Government Corporate Index was at 5% to 6%, but now

has risen to where it is about 16% of the component and the recommendation is

that the board consider amending the investment policy statement as follows:



Currently, it reads under fixed income investments and cash equivalents, plan

assets may be invested only in bonds rated ?A? or better by either Standard &

Poors or Moody. What the committee suggests is that the policy statement be

amended to read; ?Plan assets may be invested up to 15% in bonds rated ?BBB? by

Standard & Poors or Moody. The remainder of the portfolio should be invested

in bonds with a minimum rating of ?A? by both, Standard & Poors or Moody.



There were several minutes of discussion on this issue that was followed by a

motion to accept the recommendation. The motion was seconded and ratified by

the Board Of Trustees.







OLD BUSINESS:



Sub-Committee Report:



The sub-committee had been asked to meet with the three fixed income manager?s,

these have been completed with the meeting today before the Pension Board

Meeting. The consensus of the sub-committee was that the best performance and

presentation by the fixed income managers was by Tattersall and by Madison. It

was stated that if the names of the people with Synovus were covered up and all

that was looked at were the numbers and the presentations, that Synovus would

probably with the fund at this time. It was recommended by the sub-committee

that Mr. Swift contact the head of Synovus and explain the changes and

conditions that were to be made and the board would grant them another year to

improve their status and show what they are capable of performing.



As for Madison and Tattersall, the consensus is that they are performing well

and that they present their information in a way that gives the board a great

deal of confidence in their ability.



A motion was made, seconded and ratified to accept the recommendations of the

sub-committee.







NEW BUSINESS:



None



With no further business for discussion, the meeting was adjourned.

The next meeting is scheduled for January 5, 2005 at 2:00 p.m. in the Mayor?s

Conference Room. Rittenhouse will be here for their annual report.







_____________________________

Julia A. Rasch

Recording Secretary