INVESTMENT COMMITTEE MEETING

JULY 29, 1999

An Investment Committee Meeting was held Thursday, July 29, 1999 at the
Como Restaurant, 2220 Pine Avenue, Niagara Falls, New York. Time:
12:JOpm.

Present for the meeting were: Mr. Michael Quarcini, Mrs. Cheryl Cicero,
Mr. Edward Carlo, Mr. Mark Congi, Mr. Dominick Dellaccio, Mr. Angelo
Massaro, Mr. Frank Mirabelli and Mr. Don Smith.

Also present for the meeting were: Mr. Eugene Salisbury; Attorney, Mr.
Dan Parisi; Fund Consultant and Mrs. Jo.Anne Govern; Administrator.

Mr. Mirabelli called the meeting to order.

The minutes from May 21, L999 and July 23, 1999 were both tabled until the
next meeting.

The Board discussed dropping Clover Capital, leaving ten million with
Manning and Napier, also dropping HGK and Executive. There was no vote
taken .

Mr. Parisi presented a proposed allocation sheet to the Board (copy

attached). He pointed out the total assets as of June 30 , 1999 are
48,545,508 .10, also never over 100/0 in specialty categories.

During the discussion of the allocation sheet, Mr. Massaro asked why were
no bonds given to Marine Midland? Mr. Parisi stated they are mainly large
cap investors.

Mr. Parisi began a discussion of fee schedules. It was stated that with
Manning and Napier the fee structure changes below ten million. The Board
decided to address the matter if it comes up .

The Board discussed Harold C. Brown with accounts in two funds (Welfare
and Pension) . About two years ago they made the fee schedule the same for
GOVERNMENT
EXHIBIT

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Welfare and Pension. Mr. Salisbury suggested have them manage stocks
and bonds, split out the fees.

The fee schedule for Freedom Capital and Niagara Investment Advisors is
very similar as well as Key and Manning and Napier. Wright Investor
Services and Phoenix are both good bond managers. Mr. Massaro stated
that Niagara is high in the fee area at 90 basis points.

Mr. Mirabelli asked is the fee schedule the best? Mr. Parisi replied "yes". It
was suggested that we watch extremely close.

We have solid management in place. Mr. Parisi feels the fee schedules are
not as important as the managers. He feels all the money managers will
negotiate the fees. The fees are as they were presented at the interview
meetings. He will go to work on the fee structures.

Mr. Mirabelli asked if the Board members want to go through the proposed
allocation manager by manager.

Mr. Quarcini stated that he feels we should put all OLU" monies with
investment managers as opposed to any banking institutions because of the
fact that the investment firms deal only in investments.

It was decided that we accept the proposed allocation provided that in six
months we take a look see how each is doing and in another six months look
again and take the top five managers. Mr. Quarcini stated that we'd give
them one year to prove themselves.

Mr. Parisi stated going forward, each manager would have their own set of
guidelines. Mr. Parisi and Mr. Salisbury will re-write the investment
guidelines for each manager. The managers must perform up to the index
numbers.

A discussion was held on the banking institutions. Mr. Parisi stated that the
banks have no trust department (Key). The trust departments at one time
were giving the banks a bad name. They now have their own investment
departments.

Mr. Quarcini inquired whether we are looking at each manager by

classification. Me Parisi replied "yes". Mr. Mirabelli stated in theory the
Board is committing to one year . Mr. Parisi stated a full market cycle is
eighteen months. Mr. Salisbury stated let's get things in place and at the end
of a year take a look, make some adjustments if need be. Mr. Don Smith
said we're making adjustments now, we should continue to do so within a
shorter period of time. Mr. Smith and Mr. Massaro feel the allocation is
uneven.

A lengthy discussion was held regarding allocation. It was stated that we

had added six managers not five (Wright Investor Services-another bond
manager).

Mrs. Cicero made a motion to accept the allocation as presented by Mr.

nd
Parisi, 2 by Mr. Smith. Amendment to the motion provided it is revisited
in one year - unanimously carried.

Mr. Massaro made a motion for Mr. Parisi's fee to be based on seven basis
points of the total plan assets. The Board will review. There may be a
retroactive adjustment.

The next Investment Committee Meeting is scheduled for September 1999.

A motion to adjourn was made by Mr. Mirabelli, 2nd by Mr. Carlo -

unanimously carried. Time: 1:45pm.

Respectfully submitted,

Jo.anne Govern
Administrator