City of Orlando (Fla.) General Employee Pension Fund awarded Payden & Rygel $60 million in short-term fixed income for the funds $182 million defined benefit plan; the $60 million eventually will be placed in a 401(a) plan, according to Bruce Harter, city treasurer. Partial funding will come from terminated active small-cap value managers John McStay and Neumeier, which handled $17 million and $14 million, respectively, for the defined benefit plan. The balance of funding will come from reducing the portfolios of that plans remaining eight equity managers; specifics have not yet been determined.
Neumeier was terminated because of performance; McStay was terminated because the firm moved away from the funds preferred investment strategy and was unrelated to performance, said Mr. Harter. Neumeier President Peter Neumeier said, Our performance essentially matched small-cap averages ... this year, and added the fund was facing liquidity problems.
The fund is making the move because many of the defined benefit plan members wanted to be in a defined contribution plan, Mr. Harter said.
Kalson & Associates is assisting.