Jacksonville Beach pension boards approve quarterly performance report and move $15M index holding from Vanguard to lower‑cost Fidelity fund

ENCO Consulting presented the pension funds’ quarterly investment performance and recommended a housekeeping change to reduce index fees. The three pension boards voted to approve the quarterly investment performance report and to transition the Vanguard Total Stock Market index holding to a Fidelity Total Market index fund.

The presenter reported that markets recovered from spring lows and that the total fund stood a little over $101 million as of the fiscal year end and was approximately $102.5 million on Oct. 27. “So as of the end of the fiscal year, little over a $101,000,000,” the presenter said, noting the fund’s recovery.

The consultant recommended replacing about $15 million held in the Vanguard total stock market fund (charging about 4 basis points) with a Fidelity total market index fund offered at 2 basis points. “If we were to swap that for the Fidelity Fund, the plan could save roughly $3,000 on an annualized basis,” the presenter said.

Board members asked whether the switch should be limited to index exposures and why active managers with much higher fees were not being changed. Gaylord Candler asked for clarification on why the smallest‑fee account was targeted when other managers charge more. The presenter replied that active mandates involve many more factors than fee alone, while index exposures are effectively commoditized: fee is the primary differentiator.

The consultant said there would be no penalty for the transaction and that the custodian can perform a same‑day exchange so the plan would not be out of market during the change. Board motions to approve the quarterly report and to transition the index holding carried on roll call for all three boards.

The boards approved the consultant’s recommendation and asked no additional formal follow‑up beyond implementation by staff and the custodian.