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Agenda 02-11-14 BOYNTON BEACH POLICE OFFICERS’ PENSION FUND QUARTERLY BOARD MEETING Tuesday, February 11, 2014 @ 9:30 AM Renaissance Commons Executive Suites 1500 Gateway Blvd., Suite #220 Boynton Beach, FL 33426 AGENDA I.CALL TO ORDER – Toby Athol, Chair II. AGENDA APPROVAL III. APPROVAL OF MINUTES – Quarterly Meeting Nov 12, 2013 IV. FINANCIAL REPORTS: A) Quarterly Investment Review – December 31, 2013 1) Russell Investment Group – Mary Jean (MJ) Candioto, CFA a) Investment Review 2.) Burgess Chambers & Associates (BCA) – Burgess Chambers, President Frank Wan, Head of Research 1) Fund Performance review – 3) Davidson, Jamieson & Cristini – Richard Cristini, Partner & Jeanine Bittinger, Partner – Independent Auditors 1) Financial Statements for PYE 9-30-2013 4) Gabriel, Roeder, Smith & co – Pete Strong, Consultant & Actuary 1) Actuarial Valuation PYE 9-30-2013 – Valuation 10-1-2013 V. CORRESPONDENCE: N/A VI. OLD BUSINESS: A) Disability Applications: 1) Robert Epstein - 2) Gregory Kenny - Submission new disability app & HIPAA form dated 1-30-2014. B) Change November 2014 Scheduled Board Meeting – The meeting date of 11-11-2014 is a holiday -Veterans Day -- Select another meeting date… 1 VII. NEW BUSINESS: A. Invoices for review and approval: 1.Russell Investment Gp. – Quarter End 12-31-2013 - $ ???? 2.Russell Payment Services – Quarter End 12-31-2013 - $976.93 3.Perry & Jensen – Service Nov, Dec and Jan 2014 - $5,185.54 4.Burgess Chambers & Assoc – 4th Qtr 2013 fee - $5,000 5.Gabriel, Roeder, Smith & Co- Service Nov 2013 - $1,596 & Dec 2013 - $2,842 6.Davidson, Jamieson & Cristini – Audit Progress Billing - $5,500 & Final billing - $4,300 B) Attorney Report - Bonni Jensen 1) Definition of Compensation & Proposed Ordinance - status. 2) Certificate of Exemption – Status C) Fiduciary Liability Coverage – Renewal April 10-2014 – Board review for payment of renewal premium. VIII. PENSION ADMINISTRATOR’S REPORT 1.Benefits as of 02-01-2014 IX. COMMENTS: X. ADJOURNMENT: Next Regular Meeting Date – Tuesday, May 13, 2014@ 9:30 a.m. – Renaissance Commons If you cannot attend, please call Barbara @ 561-739-7972 NOTICE PO’PB IF A PERSON DECIDES TO APPEAL ANY DECISION MADE BY THE OLICE FFICERS ENSION OARD WITH RESPECT TO ANY MATTER ,/,,/ CONSIDERED AT THIS MEETING HESHE WILL NEED A RECORD OF THE PROCEEDINGS AND FOR SUCH PURPOSE HESHE MAY NEED TO , ENSURE THAT A VERBATIM RECORD OF THE PROCEEDING IS MADE WHICH RECORD INCLUDES THE TESTIMONY AND EVIDENCE UPON .(..286.0105) WHICH THE APPEAL IS TO BE BASED FS THE CITY SHALL FURNISH APPROPRIATE AUXILIARY AIDS AND SERVICES WHERE NECESSARY TO AFFORD AN INDIVIDUAL WITH A ,, DISABILITY AN EQUAL OPPORTUNITY TO PARTICIPATE IN AND ENJOY THE BENEFITS OF A SERVICE PROGRAM OR ACTIVITY CONDUCTED .CC’,(561)742-6060- BY THE CITY PLEASE CONTACT ITY LERKS OFFICE AT LEAST TWENTYFOUR HOURS PRIOR TO THE PROGRAM OR . ACTIVITY IN ORDER FOR THE CITY TO REASONABLY ACCOMMODATE YOUR REQUEST S:\CC\WP\JANET\POLICE PENSION FUND.doc 2 x_ MINUTES OF THE BOYNTON BEACH POLICE OFFICERS' PENSION FUND BOARD QUARTERLY MEETING HELD ON TUESDAY, NOVEMBER 12, 2013 AT, 9:30 A.M AT THE RENAISSANCE EXECUTIVE SUITES, SUITE 220, CONFERENCE ROOM 1 1500 GATEWAY BOULEVARD, BOYNTON BEACH, FLORIDA PRESENT: Toby Athol, Chair Bonni Jensen, Board Counsel Jason Llopis, Secretary Barbara LaDue, Pension Administrator Scott Caudell John Huntington ABSENT: Joe Degiulio I. CALL TO ORDER Chair Athol called the meeting to order at 9:30 a.m. II. AGENDA APPROVAL Ms. LaDue stated there were a few items to add to the agenda. The quarterly minutes of 8/13/13 should be added under item III, Approval of Minutes. Under Item IX, Pension Administrator's Report, item 1, Ms. LaDue added backup material for the discussion of her salary review. III. APPROVAL OF MINUTES — Special Meeting 7 -22 -13 Motion Mr. Caudell moved to approve the minutes. Mr. Huntington seconded the motion that passed unanimously. Ms. Jensen stated Ms. LaDue had noted the minutes from August 13, 2013 should be quarterly as opposed to a special. IV. DISABILITY APPLICATIONS: A) Gregory Kenny — Rescinds disability application October 29, 2013 Ms. Jensen, Board Counsel advised Mr. Kenny is back to full duty. Notification was received from Mr. Kenny through an email to Ms. LaDue. Ms. Jensen noted a letter was received from Mr. Paul Kelley, Attorney for Mr. Kenny, explaining Mr. Kenny - 1 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 returned to work. Mr. Kelley was present and stated Mr. Kenny saw the Worker's Compensation doctor and convinced him to give him an opportunity to go back to work. The Worker's Compensation doctor will re- access him in January to see how he has progressed. Mr. Kelley stated if Mr. Kenny does not do well they will re -file. Ms. Jensen commented she had been handling Mr. Kenny's disability application but has stopped the process. B) Robert Epstein — Entry of Final Order in accordance with Hearing Appeal Policy. Ms. Jensen stated the Board denied Mr. Epstein the opportunity to file an application based on the fact he was not a member at the time. Ms. Jensen sent a letter to Mr. Epstein in care of his attorney's office, but did he not receive an appeal notice during the appropriate time frame. Ms. Jensen's office sent a letter to Mr. Kelley (attorney for Mr. Epstein) notifying him the allotted time period was over. Ms. Jensen commented she has the Final Order for the Board to enter today which she sent to the Board prior to the meeting. Mr. Kelley was present. Paul Kelley, Attorney for Robert Epstein explained his office did receive the notice Ms. Jensen sent. However, Mr. Kelley acknowledged he was not aware the Order was in his office until Ms. Jensen's phone call to him. After looking through his office, Mr. Kelley stated the letter was received by the receptionist and inadvertently got attached to the back of another document. Mr. Kelley commented his client was not sent a copy of the Notice. Mr. Kelley is asking the Board to reconsider, rather than entering an Order saying the Appeal was not timely, and let the Appeal go through. This was not the fault of his client and Mr. Kelley is asking not to penalize Mr. Epstein for the error made on the part of his office. Mr. Kelley commented he spoke with Ms. Jensen and there are provisions in the plan that speaks to mailing notices to the applicant as opposed to the counsel. Chair Athol stated the Appeal process for the 20 -day notification was there. The fact Mr. Kelley's office received the notice but misplaced it, is unfortunate. The process started because there was a question whether the application was late or not and then the Appeal came as late or non -filed as well. In addition, the 20 -day cut off from the Appeal letter was not met. This puts the issue back to where it was and because of the verbiage in the plan the process is denied. Chair Athol stated there is an Appeal process through the courts that can be handled by Mr. Kelley. Chair Athol commented the Board cannot continue to go past the deadlines since this was a deadline issue to begin with. Once they go through the court process it can be presented to the Board again. Ms. Jensen acknowledged this was a correct statement. 2 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Ms. Jensen reviewed the hearing procedure rules and the Florida Bar procedures which state as follows; "Notice to an attorney acting within the scope that their representation is imputed to the attorney or for purposes of communications with client". There is also a rule that states; "Communications with persons represented by Counsel, a lawyer shall not communicate about the subject or the representation of the person the lawyer knows to be represented by another lawyer unless the lawyer has the consent of such other lawyer. Notwithstanding the foregoing, an attorney may, without such prior consent, communicate with another's client in order to meet the requirements of any court rule statute or contract requiring notice or service of process directly on an adverse party". Ms. Jensen commented there are additional rules and one of them says; ...you shall send it to the address on the application so the Notice for the hearing process should be sent directly to the person at their address ". In that case, Ms. Jensen stated, she would have been covered had she sent it directly to Mr. Kelley's client. Yet another rule says; ...the applicants for benefits under this act, may within 20 days after the denial of his or her request for pension benefits appeal said denial by filing a Notice of- Appeal with the Pension Coordinator". Mr. Kelley reiterated the applicant was never informed of the denial until after the 20 days had elapsed. Chair Athol expressed when someone is represented by an attorney all correspondence is done directly with the attorney, especially when the attorney has attended previous meetings on the same issue. Once the attorney has made themselves "the representative" of a person, that is who the Board communicates with. Mr. Kelley made a point his client had received communication from the Board such as the agenda for past meetings and gave an example, if his client were to terminate him as his lawyer, his client would not have the opportunity to go through the appeal process because copies of the notice are not sent directly to the client. Chair Athol reiterated it is a procedural issue not a personal one. The Board is bound by the 20 days the notice was sent out to the attorney who represented the client. No response was received within the 20 days so the application is denied. There is an appeal process through the Circuit Courts the attorney can go through. MOTION Mr. Llopis moved to accept the Final Order. Mr. Caudell seconded the motion that passed unanimously. Ms. Jensen will send copies of the notice to the applicant, Mr. Epstein and his attorney, Mr. Kelley. Ms. Jensen stated after the Board signs off on the change, it will be dated today but the day it is given to Ms. LaDue is the date it is rendered. After that Mr. Kelley and his client have to file in Circuit Court within 30 days. Ms. Jensen stated if the courts grant them a hearing, there would be briefs to file but no sworn testimony. 3 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 V. FINANCIAL REPORTS A) Quarterly Investment Review /PYE 9 -30 -2013 Review 1) Russell Investment Group — Mary Jean (MJ) Candioto, CFA a) Investment Review Mary Jean (MJ) Candioto, CFA Russell Investment Group reviewed the economic and financial markets, report on Russell Investments and what they are expecting, and went through the accounts. Some of the important things that happened during the quarter were the Federal Government deciding not to taper. They were essentially pushing $85 Billion a month as a stimulus into the economy. However, the federal government decided not to actually move forward with any type of taper in September which was the market consensus. It was expected to decrease from $85 Billion down to $75 or $70 Billion which was not a material change but heading down that path. This created turbulence in the market and probably will continue - -to- create volatility going forward. The second thing was the partial government shut down. The market generally appreciated the fact this was politically motivated and would return to normal without deteriorating the overall economy. The decision was pushed forward to the beginning of next year and this issue will be revisited. The third was the threat of hitting the debt ceiling. The government decided to raise the debt ceiling. Had they not raised the debt ceiling they would have gone into a period of drastic fiscal tightening. The Government could not continue to borrow which would have had a material impact to GDP growth and possibly put the U.S. back into a recession. It was expected they would come to a temporary resolution which they did. Looking forward to the coming year, policy mistakes are the biggest risk to the economy, domestically and abroad. If the U.S. does some serious fiscal tightening, this would have an impact to GDP growth. Assuming no major changes to fiscal policy, the expected GDP growth is about 3% in the next year. It is expected that 200,000 jobs a month will be added and will continue along a steady economic recovery. The big risk in Europe is they are still not a formal banking union. Europe formally came out of recession during the third quarter which was good news. They lowered their rates in early fourth quarter and they realized they had to provide some support to their economy. There have been some meaningful improvements in the Japanese economy but the consumption tax is said to increase by 3% early next year. This will be an item to watch to see if their economy can sustain that increase. 4- MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Policy mistakes is the big risk going forward, but overall there will continue to be growth with some volatility and modest single digit returns at around 7 %. From a bond perspective, some slightly negative numbers are possible. Chair Athol inquired if there was any thought to the fixed income bond being a bad investment or if the Board should pull back. Ms. Candioto indicated the graph illustration shows modest pullbacks. The expectation is 3% by the end of this year and about 3.2% at the end of 2014 which is approximately 50 basis points or about half a percent of a yield increase. There is a yield advantage over the benchmark that should help cushion any increase in rates. Consideration should be taken as to whether or not • to adjust exposure to risky assets versus your capital preservation bond assets. Continuing her presentation, Ms. Candioto showed U.S. and emerging markets just over 6% and non -U.S. developed markets coming in over 11 %. To annualize those numbers it would be 25% and 40 %. U.S. equities are about 27 %, non -U.S. equities are developed and sit at around 18 %. Emerging markets picked up slightly, but still negative and there were no material changes in the remainder of the asset classes. From a U.S. perspective the government starts to unwind the quantitative easing and ultimately the increase of funds rate. Quantitative easing has provided some support for the markets for returns. There has been stable economic growth, low inflation and moderate corporate earnings growth. The moderate corporate earnings growth is what is needed to watch in terms of what might continue to propel markets higher. One of the things continuing to create volatility is the Federal Government winding down the quantitative easing which confuses people with the Federal's fund rate. The short term rate will remain anchored until at least the end of 2015. This hedges around the fact the Federal Government has been clear they are looking for the unemployment rate to hit 6.5% before they make an adjustment. There has been recent information suggesting the Federal Government is probably looking for something closer to 6% or even 5.5% based on the fact there is not a lot of quality built up in the 6.5% number because people have stopped looking for jobs and it excludes that. It takes into account part-time employment when people prefer full -time jobs. The expectation for next year is close to 200,000 jobs a month as mentioned earlier. December 2015 is really when we think the Federal Government will start moving that rate. This is what triggers quick increases in fixed income markets but it is not expected. These are modest increases expected in the next one to two years. Ms. Jensen inquired if there are 228,000 jobs created every month; would June of 2014 be when it will arrive at 6.5 %? Ms. Candioto replied it was largely the case. Some of the numbers were done prior to the new report and are minimally off. -- 5 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Ms. Jensen commented everything that happened this fall can be disregarded. Ms. Candioto replied that was fair to say because of the partial shut -down. Even if the number of jobs was added every month, the Federal Government would not go forward and make the adjustment. Ms. Candioto continued to review the changes made after the last meeting in anticipation of September 2013. There is currently 70% of assets in return seeking or growth and 30% in the capital preservation or the fixed income assets. Of the 70% in the return seeking portfolio, 39% is in the Multi -Asset Core Fund which is the discretionary type global equity portfolio that also has real acid exposure. There is a 26% target to the large cap defensive fund which was done to give some additional U.S. exposures so there is no more than 25% allocation for foreign assets. The account also has a 5% allocation in private real estate. These numbers are marked preliminary because at the time this went to print the real estate had not yet posted a price which had a slight additional increase in market value. A snapshot of change in market value over the course of the year was shown. The year started with $66.3 million and at the end of the third quarter there was $68.9 million. As of November's close there was an increase to $74.4 million. Chair Athol inquired if the account fluctuates above and then below the $75 million mark, how would that effect the billing cycle? Ms. Candioto replied the account is billed in arrears on a quarterly basis. At the end of the quarter there will be a snapshot of everyday during the quarter and those days will be averaged, which is what drives the fee. Ms. Candioto discussed the performance of accounts. Strong performance on YTD net basis had over a 7% return through September which is actually about 15 basis points higher as a result of the real estate adjustment mentioned. The custom benchmark is about 50 basis points below at 6.5 %. This was not a bad return. Looking at the different pieces that make up the portfolio, the Multi -Asset Core is the largest holding in the portfolio. Looking at the long term numbers since inception, 17.5% is over benchmark by about 1.8 %, so there has been a good, long term or at least modest return since investing in that fund. During the third quarter the return was 5.2% and came in under the benchmark. Some of the things that drove this were having a quality focus during a very risky period. The portfolio underperformed because it was under - weighing these risky assets. Generally speaking, this portfolio takes the position underperforming by a modest amount is fine when markets are up because it is a bigger risk to underperform when markets are down. This set the portfolio back, because any time you lose value you have to gain more back in order to get to the starting point. Since the quarter ended, the funds returned an additional 2.8% and out - performed the benchmark modestly. The portfolio did have a few strategic investments that were made and there is currently an overweight infrastructure relative to the commodities in the real estate. 6 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Chair Athol asked if the portfolio is in line with the performance of the S &P over the last six months and if the allocations are set up the way they should be according to the market or are they under. Ms. Candioto responded Mr. Wan would answer that question best but commented the allocations are in line with the market. This is based on the fact the portfolio is much more diversified than the S &P or the Russell 1000. Equity market returns have gone up 25% YTD. It may look like the portfolio has not gone up but there has been a 30% allocation to fixed income which has gone up and the real asset exposure which has gone up less. Chair Athol asked Ms. Candioto if the allocations are where they should be with the market for the past six months to a year and if anything should be changed for the next year? Ms. Candioto replied over the last year the portfolio returned over 10 %, which is above the long term return assumption, the allocations are in check. Mr. Huntington asked if Ms. Candioto would recommend any changes. Ms. Candioto responded she would not recommend any changes with the caveat it is a -good exercise annually to look at what this type of portfolio can return based on capital market assumptions and interest rates. This is the bases of what you can expect not only from fixed income but also what you would add an equity return premium onto. Ms. Candioto added she would not make any changes just looking at the return seeking portion of the portfolio. The allocations are situated very well and the account is as diversified as it can be. Ms. Candioto continued discussing the remainder of the portfolio. The plan has been in the large cap defensive equity strategy for less than half a month and has modestly out- performed the benchmark and there are no concerns there. Fixed income continues to add value for taking the out of benchmark exposures and essentially adding a little bit of yield. On the real estate side, the portfolio returned 3.36% which added 15 basis points to the total portfolio return taking the YTD number on that portfolio to 11.16% it is ahead of benchmark which came in at 9.91 % for the period. Mr. Llopis commented about not capturing so much of the upswing to avoid losses. In the past the accounts did great on the upswing but did badly on the downswing. Mr. Llopis stated he understood why the Russell Investment Group postured it so there was more protection. He asked Ms. Candioto as equity, if it was doing well last quarter, why the defensive equity fund is in the negative. Ms. Candioto responded the quarter was definitely positive but the last two weeks of September U.S. equities were actually down. It was ahead of benchmark and the benchmark was down roughly 1.2% so the plan was down by 1.1%. It was less than the benchmark. It was a unique two week period where equity markets were actually negative just by the fact they were positive over the last three months. Mr. Llopis asked how long the plan had been in that fund 7 - MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 and Ms. Candioto replied since the 18 of September. Chair Athol added this was when money was taken out of the international fund to get back online and the money was put back on September 18 Mr. Huntington asked why it has to be so long before you are able to readjust and put the money back into another allocation. The investment policy guidelines that Mr. Wan put together, as well as the State rules, allow reallocations on a normal business practice if the portfolio comes out of compliance. Ms. Jensen stated she did not think the idea would be to go back into that position. Chair Athol replied if things work in reverse six months from now the funds that were going back and forth can be taken out and put back into that fund. He continued saying this was a compliance issue by September 30 and funds had to be taken out of the international fund. Mr. Wan commented the multi -asset fund under Russell Investments, allows the portfolio manager himself to choose to go one way or the other without anyone's knowledge, which is his - discretionary fund. If he chooses to go heavy into international he can still do that. At this point, for the sake of compliance it is not a good idea to move the money or go back. Mr. Liopis commented the point he was trying to make was; is the plan being too defensive and is it missing the upswing; is it missing too many positive benefits. Ms. Candioto replied talking to portfolio managers of this fund, they think they were positioned a little more defensively then they should have been. In terms of how to adjust for that going forward, it would add a risk to the portfolio. They are hoping to see a dip to buy low as opposed to buying high. This portfolio has returned about 2.8% relative to the benchmark returning about 2.6 %. This is due not only because of the portfolio adding more risk, but also because quality stocks have done much better than the risky stocks which is reflective of how the plan is positioned. Ms. Jensen asked Ms. Candioto if she knew how much the real estate funds return impacted the Federal portfolio. Ms. Candioto replied it was about 15 basis points. The real estate for the quarter was up about 31/3 % which added 15 basis points to the total portfolio so that would have taken the net of fee total assets to about 7.2 %. Ms. Jensen commented the fiscal YTD was about 10.5 %. Ms. Candioto replied that would be gross. The real estate net of fees would be about another 15 basis points. Mr. Huntington stated that would be about 9.6 %. Ms. Jensen asked Ms. Candioto if she could send out a new return page because it is a fiscal year and Ms. Candioto replied she would circulate it tomorrow. No other questions or comments were made and Ms. Candioto completed her report. 2) Burgess Chambers & Associates (BCA) — Burgess Chambers, President Frank Wan, Head of Research b) Fund Performance Review 8 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Frank Wan, Head of Research, Burgess Chambers & Associates, recalled in 2012, the plan made 18.5% which was 2% above peer groups. This current fiscal year, the plan underperformed peer groups. However, there was a 2% increase from last year that could be added to even out the averages. Over the last two years taking into consideration the 18.5% and the 10% this year, the plan is in -line with peer groups. However, this year the plan is behind the peer groups. The most important goal for this plan is to reach the actual rate of assumption at the highest probability. The plan does not have to necessarily aim for 20 -25% all the time, but if the plan can reach 744% every year for the rest of our lives, that would be ideal. There are no volatile funding expectations from anyone and the plan will move on for the rest of its life. Mr. Wan stated he does agree with Ms. Candioto that the market is bound to take a drawback and when it does the plan needs to be more defensive. The bonds have hurt the plan because there is a significant allocation in bonds, but they have done a great job because the bond market was 1.7% for the past 12 months and their fund was only down .3 %. Even though bonds risk is - -5% at the stress level test, bonds are expected to make zero if not a bit negative. Mr. Wan asked if there was ever any thought to holding funds in cash as a strategic move in case there is a market dip the plan can buy in. It is Russell Investments policy to stay fully invested at all times. Ms. Candioto stated in the stand alone fixed income portfolio the plan is fully invested at all times. However, within the multi -asset core fund which also has a slice of fixed income in it, Russell Investments does the same with cash. Mr. Wan continued that Burgess Chambers return expectations for bonds in a zero rising interest rate environment is going to be 2.5 %. However, if the forecasts go from 2.7 -3.2% that is a losing proposition and bonds will lose face value. Under those assumptions a small amount of cash would not hurt. Mr. Wan continued with graphs showing the return rates which are measured by the largest plans in the country. For the last year, the plan was ranked 73 but still beat the benchmark. The policy benchmark was 10% and the plan was ahead despite such a large underperformance during the recent quarter. The plan has done quite well and Russell Investments has done what they are designed to do based on the policies. The policy is more conservative and has a small overweight in bonds than the typical peer group, but bonds will not hurt the plan when the market does a reversal. Ms. Jensen pointed out to Ms. Candioto the policy benchmark indicated in Burgess Chambers presentation is 10.0r/0 and the presentation for Russell Investments says 6.75% for the fiscal year. Mr. Wan pointed out the difference between Burgess Chamber's book and Russell Investment's book is that Russell Investments is using an inaccurate benchmark for policy. They use intermediate aggregate versus the aggregate which is the policy and they use TIPS (Treasury Inflation Protected Securities) instead of T -Bills (Treasury Bills). There is a slight discrepancy in their portfolio. 9 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Chair Athol asked if there was any way to find a peer group more specific to Florida because some of the peer groups the plan is up against are billion dollar plans in other states that do not have the regulations that Florida has. Even though it is a benchmark they are completely different. Chair Athol inquired if there is a list of other Florida public pension plans that would be more comparable to the police plan. Mr. Wan responded that Burgess Chambers has a pool of 58 different public plans in the Florida area to use as peer groups for this plan. Chair Athol commented this would be more helpful than peer groups outside of Florida. Mr. Wan will bring an additional insert next meeting with that information. The Police fund is almost 100% liquid, even the real estate is quarterly liquid so you can get in and out on a quarterly basis. On a national level those multi- billion dollar funds have up to 15 -20% in non - liquid assets where they are stuck for 10- 15 years at a time. This is a large difference from the Police plan. For the quarter, all the numbers were positive including the bonds. Even though bonds are a risky asset at this time, there is a long term rate of 6.5% and right now the plan is at 2.7 %. If the plan moves- back to -long -term averages, and if the interest rate moves up from 2.7% to 6.5 %, that would still not be as bad as the worst case scenario for stocks. Mr. Wan explained he pulled two different ETF's. One was the U.S. stock and the other an international stock ETF to show how it may have impacted the portfolio. Despite a short term dislocation between the red and the blue line there was actually a small gain. Since the transition it was a wash or mutual because US stocks are higher than the international stocks. There is no long term impact. For the quarter international stocks were up 11%. Real estate is an asset class and will be one of the supporting columns outside of bonds. Chair Athol inquired if Mr. Wan saw anything in the portfolio he felt is a negative or where the plan can be changed for better performance. Mr. Wan replied when the portfolio is more opportunistic with bonds the risk of stocks goes up. This is not saving the total portfolio from a bad day. For example, if high quality U.S. bonds are replaced with corporate bonds they would move in the same direction as stocks. So, if there is a 40% bond portfolio, it is really only 30% if investments were heavy in corporate bonds. There are other parts of the portfolio tied to interest rate movement. When interest rates go up, bonds and commodities go down. Mr. Wan suggested a correlation study, a cap or a market assumption be done. Peter Strong, Consultant and Actuary for Gabriel, Roeder, Smith & Co. asked both Mr. Wan and Ms. Candioto what they felt the forecast for the next 5 -10 years was going to be in terms of capital market assumptions, and asked if 7.75% net is achievable given the current asset allocations. Mr: Wan responded based on the current numbers from the Burgess presentation, the five year projection excludes the worse of 2008 and still returned an 8% target. There has been distress in the market, but there has also been a recovery. Volatility cannot be ignored, but at lower interest rates it cannot support higher PE's. Historically speaking, if there was a return of 10% out of stocks 10 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 and 6% out of bonds there would be an 8% return. However, if there are 2% from bonds and 14% from stocks, would the portfolio be able to achieve 14 %? Mr. Strong commented 7.75% net is approximately 8.38.4 gross and the portfolio would need 12 -14% retum on equities for the long term. Mr. Strong also remarked the plan has to match what it expects to gain without stressing the risk levels. He asked Mr. Wan what would be the most realistic investment return assumption without making the plan too risky. Mr. Wan explained if the long term average is around 12% that would be a good time to reduce the risk so the City is not forced to put money back into the fund. If the Board chooses to lower the risk it would not be recommended to take a half percent decrease but maybe do it over a ten -year period. This would show a good faith effort to the City so there would not be a large cost impact versus bankrupting a City. Ms. Candioto commented in addition to providing an exact expectation of what the portfolio may do going forward, guidance can be provided around what the probability will be. Ms. Candioto also stated if there is a chance the portfolio will still get 7.75% and if that is as high as it will be comfortable with, the answer would be no and then consider some options to realign. Mr. Strong asked Ms. Candioto if she thought the odds are less than 40 -50 %. Ms. Candioto responded she would want to run the numbers before answering. Ms. Jensen pointed to the Burgess Chambers presentation, the fixed income number is the amount that is in the fixed income outside the multi assets. This means the fixed income number is really higher than 30 %. Mr. Wan responded it was probably another 7% higher. Ms. Jensen stated the plan is about 11 % below the alternatives. Mr. Wan stated the alternatives in the multi -core fund where commodities and rates are invested. A spreadsheet can be created to show a better illustration. Chair Athol inquired of Mr. Wan if this is where some allocations should be made to real estate. Mr. Wan replied this was what he had suggested but Russell Investments are the designers of the portfolio and would better answer the question. Ms. Jensen responded the investment companies can make the decisions around the multi -asset core fund investment, but the police pension fund has to tell them where to take items out and re- allocate them into real estate or any other fund. Mr. Huntington asked Mr. Wan if the pie chart showing the percent target is Burgess Chambers' benchmark. Mr. Wan responded these are asset categories used in the presentation to depict if the portfolio is underweight or overweight. A benchmark would be a designed program with funds allocated into various different assets. Ms. Candioto asked Mr. Wan about the date of May 2013 versus August 2012 and perhaps this was the reason for the difference in their projections. Mr. Wan suggested meeting with Ms. Candioto to evaluate certain risks in the portfolio and bring back this 11 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 information along with adopting the change of moving from international back to domestic for the next meeting. Mr. Caudell commented about how all manufacturers are moving to China and asked what impacts will that have on the portfolio in five years. Mr. Wan responded manufacturers are going to Vietnam, Thailand and even parts of Cambodia. However, recently, there has been a reversal of manufacturers coming back to the U.S. Now with Obamacare and so many other changes, Ireland is the new country where the U.S. is forming their corporations. Sentra, Global Insurance and many other companies are going to Ireland for tax purposes. Mr. Huntington stated the only way to get the unemployment rate down is through manufacturing in the U.S. Going back to the asset allocation discussion, Mr. Wan commented there is a slight underweight in private real estate and perhaps more funds should be added. The target is about 5% and 5% of $75,000,000 is about 3.7 -4 which would be a comfortable margin. Whatever the difference is can be added to private real estate. The other issue is the multi -core where there is a small amount of bonds that can be taken off the table and go into the large defensive equity fund if appropriate. Ms. Candioto commented there have been a few clients who made the same adjustment. She also stated a 5% increase to private real estate would be acceptable. Ms. Jensen inquired if 10% of the fund in alternative investments is within the multi -asset core fund. Ms. Candioto replied the multi -asset core fund made up about 16% of real assets in the portfolio and that is 75% of the portfolio. Ms. Jensen asked if the rates are considered alternative or just in equities. Mr. Wan responded there is a stand -alone 5% target towards rates and right now the portfolio is underweight but that is no concern. The biggest risk is the volatility from stocks and the interest rate environment. Chair Athol inquired how much would be taken out of the fixed income /bonds and put into real estate. Mr. Wan suggested going back to the original target and then make changes if needed and bring real estate up to 5 %. Mr. Strong commented making the change now to achieve the probability of the 7.75% net return. If it comes in at less than 50% perhaps making the adjustments discussed earlier to more real estate to see if that would get the portfolio to a 50% probability of achieving 7.75 %. Ms. Candioto stated Russell Investments will first show what the probability of the current portfolio meeting the 7.75% over a long time period and then the second exercise would be if the Board is not comfortable with the probability of that happening, there would be some alternative portfolios that would get to a 50% or 75% probability. Mr. Wan interjected going forward, Burgess Chambers will compare the Police Pension plan against Florida plans and include all the smaller segments and compare to other plans. Ms. Candioto replied typically to do a re- balance the dollar amount necessary would be calculated and on the date the trade is made, funds would be taken out of 12 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 wherever the portfolio is overweight. Chair Athol commented there would not be a specific spot until the floating market in March. Motion Mr. Huntington moved to bring the real estate fund up to a 5% target. Mr. Caudell seconded the motion that passed unanimously. Mr. Wan asked if there should be a discussion on rebalancing the bond portfolio. He stated bonds are a little overweight but nothing drastic. Ms. Candioto commented from the plans perspective, it is a rebalancing. From Russell's perspective, it is a re- allocation. This is a discussion that can be re- visited at the next Board meeting. Mr. Strong stated at the last meeting, he explained some of the changes that were coming. GASB (Government Accounting Standard Board) 67 and 68 were passed and put into effect in 2012 for new reporting requirements auditors are going to need to have to include in the financial statements. GASB 67 is effective first and becomes effective in September 30, 2014 which just started last month. GASB 68 does not go into effect until September 30, 2015 and will be more involved than GASB 67. GASB 67 are about 3 -4 exhibits that need to be included which auditors will need to have to complete their financial statements. One of the exhibits will be calculating the effective discount rate which involves doing a 100 year projection on a closed plan basis. Any cash flows beyond that point will use the municipal bond rate and cash flows up to that point will just expect a return of 7.75 %. It can go up to the equivalent discount rate which is called your effective net discount rate and liabilities are determined using that rate. Most plans are coming out with an effective discount rate very close or equal to the expected rate of return. It is unlikely there will be an asset run out date, but it still has to go through the process to demonstrate this to the auditors. There is a statement of all net assets and liabilities on a market value basis. This will have to be trued up at the end of the year. Because it is on a fair market value basis, and what the auditors will be looking for when preparing their annual financial statements, they will need the market value of assets shortly after September 30, 2014. A letter truing up the exhibits will be prepared in advance with what the actual market value of assets is at the end of the year. Mr. Strong proposes including these exhibits in the October 01, 2013 actual evaluation reports and the only thing to do at the end of the year is roll forward to September 30, 2014 with a letter. Gabriel, Roeder, Smith and Co. has disclosed what their fee will be to do this extra work. They are proposing the same fee rates for all of their clients based on complexity that can vary with the 100 -year projection. Mr. Strong stated the estimate is between $1,500 -2,500 upfront for the calculations that will go into the October 01, 2013 evaluation and then another charge of $450 at the end 13 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 of the year for the letter that will true up the exhibits using the final market value of assets as of September 30, 2014. Chair Athol commented these are the requirements for making true on the plan every year. Mr. Strong explained GASB is a Board in Connecticut that makes these rules. Starting in 2010 they began getting pressure from other entities to make changes. Mr. Wan interjected there is also an IASB (International Accounting Standards Board) and many times their rules conflict with the GASB. Chair Athol commented they charge more and more money to comply. As a part of bill 534 the bulk of those requirements will not go into effect until October 01, 2014. However, the 7.75% extra disclosure requirement goes away under bill 534. GASB is taking away the October 01, 2013 but adding many other requirements as a October 01, 2014. In the October 01, 2013there is a break of what is required for extra state disclosures. Mr. Strong said his firm has been lobbying to repeal the new requirement. MOTION Mr. Llopis moved to approve the expenditure to allow Gabriel, Roeder, Smith and Company to do the appropriate studies to remain in compliance. Mr. Huntington seconded the motion that unanimously passed. Mr. Strong commented he did a calculation based on a 9.5% market value return net the return on the actuarial value of the assets is a little over 7 %. There are still some fluctuations pushing some gains off, but this puts the plan close to the 7.75% mark. VI. CORRESPONDENCE 1) 2014 IRS Contribution Limits (Provided by Tegrit Group Fire DROP Admin) Chair Athol inquired if these were the 401 K contributions. Ms. LaDue responded this is for anyone who has vacation and sick pay roll -over. For 2014 the max would be $52,000 to roll over. If there is anything over that amount, it would be deposited January 1, 2015. VII. OLD BUSINESS There was no old business to discuss. VIII. NEW BUSINESS a) Invoices for review and approval. 14 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 1. Russell Investment Group — Quarter End 9/30/2013 2. Russell Payment Services — Quarter End 9/30/13 for $902.52 3. Perry & Jensen — Service for Aug., Sept., and Oct for $6,266.96 4. Burgess Chambers & Assoc. — 3` Quarter 2013 fee $5,000 5. Gabriel, Roeder, Smith & Co. — Service Aug. $1,445 and Sept $4,742 6. Ellen Schaffer — Programming Vac /Sic CAPS - $460 7. Annual Renewal Macola/Exact - $437.50 8. Micro Focus — Support Line Renewal - $144.32 Motion Mr. Llopis moved to approve paying all invoices for services rendered. Mr. Caudell seconded the motion that unanimously passed. Ms. LaDue noted the invoice for Russell Investments was not available. Ms. Candioto stated she sent an email to the Seattle office but did not get a response. Ms. Jensen replied the invoice can be approved subject to ratification as long as it is verified which Ms. LaDue will do. Ms. LaDue will put this on the agenda for the next meeting. b) Attorney Report — Bonnie Jensen 1. Definition of Compensation & Proposed Ordinance — Status Ms. Jensen stated she has not gotten any response to her requests for the status of the change. Mr. Strong stated the assumption was done on June 18, 2013. The calculations are still being done reflecting all accrued leave. Ms. Jensen added this was a concern for the general employee's side because there were retirements coming up. People will be paid their benefits in accordance with the current Ordinance. Language was added to the end on the effective date that says it will not become effective until a specific date. 2. Attorney Fee Increase — Letter of 10/29/13 Ms. Jensen requested an increase of her attorney's fee. In 2008, she increased her rates to $200 per hour and guaranteed that rate for a three year period and it has been five years. The increase requested is $225 per hour effective December 16, 2013 which is the next billing cycle and guarantees it for a period of three years. Motion Mr. Llopis moved to approve the hourly fee increase to $225 for Ms. Jensen, Board Attorney. Mr. Caudell seconded the motion that unanimously passed. 15 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Ms. Jensen stated there was another issue to discuss regarding a letter received from the State. The letter asked if the police pension plan was or was not a supplemental plan. At the last legislative session, there was a provision in the law that allowed supplemental plans to have more liberal rules about the chapter money going forward. At that point it was asked if the plan was included as a supplemental plan. Ms. Jensen explained she has researched the definition of a supplemental plan, and looked at the plan's Ordinance as well. Ms. Jensen came to the conclusion that the plan is in fact a supplemental plan. The plan essentially uses money over the frozen amount to provide a benefit. Ms. Jensen sent a letter to all Board members explaining the plan is a supplemental plan based on the structure. The benefit was created using the additional funds over the frozen amount for 1997 plus 1 % of payroll. The benefit is provided by the deposits, pays extra benefits to police officer retirees, and exists in conjunction with the defined benefit plan. Those are the criteria for meeting the supplemental planning provisions. Ms. Jensen asked the Board to approve sending the letter to the State. Motion Mr. Caudell moved to approve sending the letter to the State confirming the plan is a supplemental plan. Mr. Huntington seconded the motion that passed unanimously. Ms. Jensen alerted the Board the Palm Beach County Ethics Board requires employees watch their video every two years. c) Verification of Retirement Benefits 1) George Immler — Normal Retirement 2) Scott Caudell — DROP Retirement 3) Michael Mulcahy — Vested Termination Chair Athol stated Mr. Mulcahy was hired January 2006 and left January 2013. Ms. LaDue commented Mr. Mulcahy had six years, eleven months and twenty -five days. Mr. Mulcahy elected not to withdraw any contributions and will get a deferred vested benefit beginning February 2026. Chair Athol stated Mr. Caudell must abstain from voting. 16 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 Motion Det. Llopis moved to approve retirement benefits for Mr. Mulcahy and Mr. Immler. Mr. Huntington seconded the motion that passed unanimously 4 -0. Motion Mr. Llopis moved to approve retirement benefits for Mr. Caudell. Mr. Huntington seconded the motion that passed unanimously. (3 -0 Mr. Caudell abstaining). IX. PENSION ADMINISTRATOR'S REPORT 1) Pension Administrator — Salary Review Ms. LaDue stated the agreement between the firefighters and the police officers was to split her salary 50/50. The firefighters have been giving Ms. LaDue annual raises since 2007/2008 which brought her up to $2,282 monthly. However, she has been receiving only $1,754 a month from the Police Officers. Ms. LaDue is requesting the Police Officers bring up the monthly fee to match that of the Firefighters. She requested the increase go into effect October so that it is even with the Firefighters. Ms. LaDue also requested the Police officers match the Firefighters with a 5% increase every October. Chair Athol agreed to bring Ms. LaDue's salary up to match the Firefighters but will evaluate the 5% annual increase on a year -to -year basis. Motion Mr. Caudell moved to increase Ms. LaDue's salary to $2282 monthly to match that of the firefighters. Mr. Huntington seconded the motion that unanimously passed. 2) Schedule 2014 Quarterly Board Meetings — Review The schedule for the 2014 quarterly Board meetings will be February 11 May 13 August 12 and November 11 to Mr. Huntington interjected and asked Ms. LaDue about her possible retirement. Chair Athol inquired if Ms. LaDue was thinking about retiring and asked her if she had any idea yet of when that would be. Chair Athol also stated they would need at least six months' notice so they can have a chance to train someone to take her place. Ms. 17 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 LaDue replied she had not made any decision yet, but would certainly give appropriate notice in order to train someone. Chair Athol also commented there is $5,000 in the expenditures for a new computer. He would like to contact the vendors (Network Solutions) and look into the price of getting someone to host a website. The website would be for people to be able to retrieve information online. Mr. Caudell stated he looked at Ms. LaDue's laptop and it cannot support the amount of programs it has on it. Mr. Caudell also inquired what "Ellen" does in regards to the computer. Ms. Jensen stated she is the programmer and actually programs the system. Chair Athol stated most of the software on the laptop is too sophisticated for what it is currently used for and may not be needed. Ms. Jensen explained the accounting component is on the laptop as well. Mr. Caudell commented the programs currently on the laptop should be reviewed to eliminate anything not needed. Ms. LaDue commented there are many - different firewalls and other things she is not sure is needed. Chair Athol stated the firewalls provide security and is of the utmost importance. Everyone needs to be on the same page as far as the everyday access to the website. From this point forward, people need to be able to access the website to do what they need to do and eventually eliminate the paper trail. Hopefully at some point, 80 -90% of people can do what they need to do online, run quarterly reports, access their DROP accounts or loan applications. There will be some who do not understand how to access the information they need from the website and will still rely on paper, however, there will come a point when the reverse will happen and everyone will fully understand the website. Ms. LaDue stated she would like to see the changes with the website start happening within the next few months. Ms. Jensen stated the systems are currently not able to identify people online without difficulty at this moment. She assumes it will get better and there will be some kind of notarization type of process that can be done online. Until then, Ms. LaDue will still have to deal with paper in order to verify she saw someone's original marriage certificate or any other original document. Chair Athol commented the online process can go as far as it can go until the point the applicant needs to see Ms. LaDue with their original documents. Ms. Jensen stated someone with basic computer knowledge will need to be included so the information can be transferred from one computer to the other. The possibility of hiring someone from the outside will need to be discussed but consideration of the confidential information needs to be taken into account. Both the fire and police plans are on the same computer, so it would have to be discussed with them as well. 3) Benefits as of PYE 9/30/2013 18 MEETING MINUTES POLICE PENSION BOARD BOYNTON BEACH, FL. NOVEMBER 12, 2013 The benefit as of PYE 9/30/13 is available. X. COMMENTS None. XI. 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Oki Ii i ,I, 1 t '4 r "" oOtt' h . „i 41 cr . a: 0 0 : ' °‘' if '' ' ° c 0 j b o o • " o , r a , 0) o = a o R /4 -i n 0 r It - N o 4:.w(D O)o N ap A o , Z Cr N . C CO -I n M ._ o o o m o 0 r _ 3 m Z > » %9 y . j V) = m \ : \ 1:1-. > _ cla r _______________ / 0 -1 7. x 0 — E � � � 0 � 0 % g ] E E E . / 7:1 0 E q k / 2 ® ] m 0 0_ al / . « ¥ r E . s » } r+ § . .. \ C j 7 • • • e • • / n 5 @ @ 2 e \ j \ \ / _ co ƒ E g \ m \ E / / \ § ] E. • i-% @ -I (D 7 ° / @ w w NJ NJ w E \ 0 y» y y» 7¥ y 3 .-+ \? \ 5 ) / \ e cr ro 0 NJ a a o a $ $ CU & 7 y y 7 7 7 y 1; ro ■ • / a. \ 2 .• ro –is y . $ % ? % $ ƒ ƒ / @ . 0 ~ fy a • • • • • • / 7 / z 2 2 _. @ 0 . .,, , & ] \ \ \ _ \ f/ \ ± \ q 3 / / 2 Q § \ / 2 a / \ © 2 / \ ° \ • BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement 1. PURPOSE OF INVESTMENT POLICY STATEMENT The Pension Board of Trustees maintains that an important determinant of future investment returns is the expression and periodic review of the Fund's investment objectives. To that end, the Trustees have adopted this Investment Policy Statement to apply to all of the assets of the fund. In fulfilling their fiduciary responsibility, the Trustees recognize that the pension fund is an essential vehicle for providing income benefits to retired participants or their beneficiaries. The Trustees also recognize that the obligations of the Fund are long -term and that the investment policy statement should be made with a view toward performance and return over a number of years. The general investment objective then is to obtain a reasonable total rate of return — defined as interest and dividend income plus realized and unrealized capital gains and /or losses — that meets or exceeds the actuarial interest rate assumption net of fees to ensure the Fund is actuarially sound. This return is expected on a regular basis over rolling actuarial measurement periods. The Trustees, the Fund's investment manager(s), and investment monitor /consultant shall comply with the following fiduciary standard: A fiduciary shall discharge its duties with respect to the Fund solely in the interest of the participants and beneficiaries and a. for the exclusive purpose of providing benefits to participants and their beneficiaries and defraying reasonable expenses of administering the pension Fund; b. with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims; c. by diversifying the investments of the Fund so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so. Reasonable consistency of return and protection of assets against the inroads of inflation are paramount. However, the volatility of interest rates and securities markets make it necessary to judge results within the context of several years rather than over short periods of one- or two - years or less. 2. INVESTMENT PERFORMANCE OBJECTIVES The below listed performance measures will be used as objective criteria for evaluating 1 2/11/2014 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement effectiveness of the investment manager(s): A. Total Fund Performance 1. The performance of the total Fund will be measured net of fees for rolling three- and five -year periods. These periods are considered sufficient to accommodate the market cycles experienced with investments. The performance of the total Fund will be compared to a Benchmark comprised currently of: 30% MSCI ACWI Equity Index, 25% Russell 1000, 32% Barclays Capital US Aggregate Bond Index, 2% NAREIT Index, 2% S &P Global Infrastructure Index, 5% NCREIF Index Open -End Diversified Core Equity -Equal Weight, 2% DJ -UBS Commodities Index, and 2% ML 3 -Month T- bills. 2. On a relative basis, it is expected that the investment manager's performance will rank in the top 40th percentile of an appropriate balanced universe over three- to five -year periods. 3. On an absolute basis, it is expected the total Fund return will equal or exceed the actuarial earnings assumption rate (7.75 %) over rolling five -year periods. For each actuarial valuation, the Trustees will determine the total expected annual rate of return for the current year, for each of the next several years, and for the long -term thereafter. B. Fixed Income Performance The fixed income portion of the portfolio is expected to meet or exceed the return of the Barclays Capital US Aggregate Bond Index, and rank within the top 40th percentile of an appropriate fixed income universe over three- and five -year periods. C. Private Real Estate Performance The Private Real Estate portion of the portfolio is expected to meet or exceed the return of the NCREIF Index Open -End Diversified Core Equity -Equal Weight, and rank within the top 40th percentile of an appropriate Real Estate universe over three- and five -year periods. 3. INVESTMENT STANDARDS AND GUIDELINES Liquidity. The Fund's investment manager(s) shall be kept informed of the liquidity requirements of the Fund. The investment portfolio shall be structured in such a manner as to provide sufficient liquidity to pay obligations as they come due. To the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated 2 2/11/2014 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement cash - flow requirements. Custodian: The Board of Trustees has a retained and will continue to retain a third party to be custodian of the Fund's assets. All securities shall be designated as an asset of the Fund, and no withdrawal of securities -in whole or part-shall be made from safekeeping except by an authorized member of the Board of Trustees or the Board of Trustee's designee. Security transactions between a broker dealer and a custodian involving the purchase or sale of securities by transfer of money or securities must be made on a "delivery vs. payment" basis, if applicable, to ensure that the custodian will have the money or security, as appropriate, in hand at the conclusion of the transaction. Bid requirement: The Trustees shall determine the approximate maturity date based on cash flow needs and market conditions, analyze and select one or more optimal types of investment, and competitively bid the security in question when feasible and appropriate. Except as otherwise required by law, the most economically advantageous bid must be selected. Risk and Diversification: The investments held by the Fund shall be diversified to the extent practical to control the risk of loss resulting from over - concentration of assets in a specific maturity, issuer, issuer, instrument, dealer, or bank which financial instruments are bought and sold. A. Authorized Investments: 1. Commingled equity, fixed income, money market, and alternative (real estate, listed infrastructure, commodities) funds and institutional mutual funds whose investments are restricted to securities meeting the criteria outlined in Section 3B. B. Limitations 1. Illiquid investments, as described in Chapter 215.47, Florida Statutes, are prohibited. 2. Foreign investments are limited to 25% of the total pension fund, at market. 3. All repurchase agreement transactions shall adhere to the requirements of the Master Repurchase Agreement. 4. Under Protecting Florida's Investment Act ( "PFIA "), scrutinized companies published by the State Board of Administration are prohibited, unless an indirect investment is unable to divest, as provided for in Florida Statutes section 215.473. 5. The following investments are prohibited, unless authorized by the Trustees: a. Futures (exceptions are mutual and commingled funds) b. General obligations issued by a foreign government c. Hedge funds 3 2/11/2014 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement d. Insurance annuities e. Internally managed assets f. Limited partnerships g. Margin Accounts h. Options (exceptions are mutual and commingled funds) i. Private equity j. Private mortgages 4. COMMUNICATIONS A. The custodian shall apprise the Trustees of all transactions and shall forward all proxies to the investment manager(s) within ten calendar days. On a monthly basis, the custodian shall supply an accounting statement that will include a summary of all receipts and disbursements and the cost and the market value of all assets. On a quarterly basis, the investment manager(s) or investment monitor /consultant shall provide a written report affirming compliance with the security restrictions and a summary of common stock diversification and attendant schedules. The investment manager(s) shall deliver each quarter a report detailing the Fund's performance, adherence to the investment policy statement, forecast of the market and economy, portfolio analysis and current assets of the Trust. Written reports and personal presentations shall be delivered to the Trustees within 60 days of the end of the quarter. The investment manager(s) will provide immediate written and /or telephone notice to the Trustees of any significant market related or non - market related event, specifically including, but not limited to, any deviation from the standards set forth in Section 3B above. B. The investment manager(s) will disclose any securities that are not in compliance with Section 3B in each quarterly report. C. The Trustees shall retain a monitoring service to evaluate and report on a quarterly basis the rate of return and relative performance of the Fund. D. The Trustees will meet quarterly with the investment monitor /consultant to review the Performance Report. The Trustees will meet with the investment manager(s) and investment monitor /consultant to discuss performance results, economic outlook, investment strategy and tactics and other pertinent matters affecting the Fund on a quarterly basis. E. The equity investment manager shall report to the Trustees on an annual basis with respect to proxies, the issues, votes and dates, and if not voted, a written explanation. 5. CRITERIA FOR INVESTMENT MANAGER REVIEW The Board of Trustees wish to adopt standards by which judgments of the ongoing performance of an investment manager may be made. With this in mind, the following are 4 2/11/2014 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement adopted: If, at any time, any one of the following is breached, the investment manager(s) will be warned of the Trustee's serious concern for the Fund's continued safety and performance. A. Four consecutive quarters of the investment manager's performance below the 40 percentile in appropriate performance rankings. B. Standard deviation for the Fund in excess of 120% of the market. C. Loss by the investment manager(s) of any senior investment personnel. D. Any change in basic investment philosophy by the investment manager(s). E. Failure to attain a majority vote of confidence by the Board of Trustees. F. Failure to observe the security quality restrictions in Section 3B. 6. INTERNAL CONTROLS The Fund shall be governed by a set of written internal controls and operational procedures, which shall be periodically reviewed by the Fund's certified public accountant (CPA). At the time of every financial audit, the CPA shall review the controls that should be designed to prevent loss of funds that might arise from fraud, error, or misrepresentation by third parties or imprudent actions by the Trustees or the employees of the City of Boynton Beach. 7. CONTINUING EDUCATION The Fund acknowledges the importance of continuing education for the Trustees. Ongoing education will be provided by the Fund's actuary, attorney, custodian, investment manager(s), investment monitor /consultant, and administrator. In addition, the Trustees are encouraged to attend educational conferences in connection with their duties and responsibilities as Trustees. Each Trustee is encouraged to attend a minimum of two conferences or seminars per year. Additional conferences or seminars are also encouraged. Each Trustee may attend up to six conferences in state and two conferences out -of- state, every year, without additional Board approval. 8. FLORIDA STATUTES 112, 185 AND APPLICABLE CITY OF BOYNTON BEACH ORDINANCES If at any time, this document found to be in conflict with Chapter 112.661 or Chapter 185, Florida Statutes, or the applicable City of Boynton Beach Ordinances, the Statutes and Ordinances shall prevail. 9. PROXY VOTING 5 2/11/2014 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement In general, proxies shall be voted in accordance with the Trustees proxy policy, which is: "The Board of Trustees of the CITY OF BOYNTON BEACH POLICE OFFICER'S PENSION FUND recognizes that proxy voting powers are an asset of the Fund and must be exercised for the exclusive benefit of the participants in the Fund ". On a regular basis, no less frequently than annually, the investment manager(s) shall report a record of his or her proxy vote. 10. REVIEW AND AMENDMENTS It is the Trustees intention to review this document periodically and to amend this statement to reflect any changes in philosophy, objectives or guidelines. In this regard, the investment manager's interest in consistency in these matters is recognized and will be taken into account when changes are being considered. If at any time any investment manager feels that the specific objectives defined herein cannot be met, or the guidelines constrict performance, the Trustees should be notified in writing. By initial and continuing acceptance of this Investment Policy Statement, the investment manager(s) concurs with the provisions of this document. Once the Trustees have adopted the investment policy statement, the investment policy statement shall be promptly filed with the Department of Management Services, the Fund sponsor, and the consulting actuary The effective date of the Investment Policy Statement and any amendment thereto shall be the 31st calendar day following the filing date with the plan sponsor. 11. ASSET ALLOCATION Deliberate management of the asset mix among classes of investments is both a necessary and desirable responsibility. In the allocation of assets, diversification of investments among asset classes that are not similarly affected by economic, political, or social developments is a highly desirable objective. The Fund's general policy shall be to diversify investments within both equity and fixed income securities so as to provide a balance that will enhance total return, while avoiding undue risk concentrations in any single asset class or investment category. The addition of real assets, such as real estate, commodities and infrastructure, to the equity /fixed income portfolio may materially improve the ability of the portfolio to dominate inflation over the long -term. As a collection, real assets diversify each other and to equities and fixed income. Real assets may offer the potential for attractive levels of return. In making asset allocation judgments, it is not expected that the Trustees will necessarily seek to "time" subtle changes in financial markets, or that frequent or minor adjustments would be needed. Instead, it is expected to develop and adopt expressed guidelines for broad allocations on a long -term basis, in light of current and projected investment environments. To insure broad diversification in the long -term investment portfolios among the major categories of investments, asset allocation, as a percent of the total market value of the total long- term portfolio, will be set with the following target percentage: 6 2/11/2014 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement Strategic Allocation Policy Range Allocation Asset Class /Strategy ( %) ( %) World Equities 30 20 — 40 US Equities 25 15 - 35 Fixed Income 32 30 — 40 Cash/Money Market 2 0 — 5 Alternatives: 11 2 — 20 Total 100 ALTERNATIVES Private Real Estate 5 0 — 7 Public Real Estate (REITs) 2 0 — 7 Listed Infrastructure 2 0 — 5 Commodities (CCFs) 2 0 — 7 NOTE: Foreign securities are limited to 25% of the pension fund at market value. 12. PROCEDURE FOR REBALANCING ASSET ALLOCATION At the end of each month, Russell Investments will compare the Fund's asset values and their relative allocation percentages, to the rebalancing policy targets and ranges. Based on this comparison, Russell Investments will determine what trades are necessary in order to bring the investments as close to target as practical. BOYNTON BEACH POLICE OFFICERS' RUSSELL INVESTMENTS PENSION FUND By: By: As. Chairman, Board of Trustees As Investment Manager Date: Date: BURGESS CHAMBERS & ASSOCIATES, INC. By: As: Registered Advisor Date: 7 2/11/2014 • BOYNTONBEACH POLICE OFFICERS' PENSION FUND Invsrhnent Policy Slalentenl 1, PURPOSE OF INVESTMENT POLICY STATEMENT The Pension Board of Trustees maintains that an important determinant of future investment returns is the expression and periodic review of the Pond's investment objectives. To that end, the Trustees have adopted this Investment Policy Statement to apply to all of the assets of the fhnd. In fblfliling their fiduciary responsibility, the Tntstees recognize that the pension fund is an essential vehicle for providing income benefits to retired partiolpan s or their beneficiaries. The Ti also recognize that the obligations of the Fund are long-term and that the . investment policy statement should be trade with a view toward perionnatice and return over a number of years. The general investment objective then is to obtain a reeasoi able.total rate of return — defined as interest and dividend income plus realized and unrealized dmpitat gains and/or losses — that meets or exceeds the actuarial interest rate assutnption net of fees to ensure the Fund is actuarially sound. This return is expected on a regular basis over rolling actuarial measurement periods. The Trustees, the Fund's investment manager(s), and investment monitor/consultant shall comply with the following fiduciary standard: • • A fiduciary shall discharge its duties with respect to the Fund solely in the interest of the participants and beneficiaries and a. for the exclusive purpose of providing benefits to participants and their beneficiaries and defraying reasonable expenses of administering the pension Hind; . b. with the care, skill, prudence and diligence under the circumstances then prevalltng that a prudent person acting in a like capacity and familiar with such matters would use in the conduct bf an enterprise of a like character and with like aims; o. by diversifying the investments of the Fund so as to minimize the risk of large losses, unless under tho circumstances it is clearly pendant not to do so. Reasonable consistency of return and protection of assets against the inroads of inflation are paramount. however, the volatility of interest rates and securities markets make it necessary to judge results within the context of several years rather than over short periods of one- or two- years or less, 2, INVESTMENT PERJ ORMANCE OBJECTIVES The below listed performance measures will be used as objective criteria for evaluating 2/13/2013 tat° BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Skrt.went effectiveness of the investment manager(s): A, Tolal Bend Perfoyin ice I, The performance of the total Fund will be measured net of fees for rolling three - and five -year periods. These periods are considered sufficient to accommodate the market cycles experienced with lolestments. The performance of the total Fund will be compared to a Benehtnark comprised currently of: 4$96 MSC ACWI Bquity Index, 3596 Barclays Capital CIS Aggregate Bond Index, 596 NARBIT Index, 5% NCRBW Index Open - Bnd Diversified Core Bqulty -aqua) Weight, 596 DI -UBS Commodities Index, and 296 Treasury. 2. On a relative basis, It is expected that the investment manager's performance will rank in the top 40th percentile of an appropriate balanced universe over three- to five -yea periods. 3. On tut absolute basis, It is expected the total Fund return will equal or exceed the actuarial carvings assumption rate (7.7596) over rolling five-year periods. For each actuarial valuation, the Trustees will determine the total expected annual rate of return for the current year, for each of the next several years, and for the tong term ihcrcafter. B, ¥cod Income Performance The fixed income portion of the portfolio is expected to meet or exceed the return of the Barclays Capital US Aggregate Bond Index, and raic within the top 40th percentile of an appropriate fired income universe over three- and five -year periods. C. Private Real Male Pfrktiritkce The Private Real Estate portion of the portfolio is expected to meet or exceed the return of the lNCRBIF Index Open -&td Diversified Core Equity -Equal Weight, and rank within the top 40th percentile of an appropriate Real Relate universe over lhroe- and five -year periods. 3, INVESTMENT STANDARDS AND GUIDELINES Liquidity: The Fund's investment manager(s) abaft be kept informed of the liquidity requirements of the Pond. The investment porttolio shall be structured in such a manner as to provide suffiolent liquidity to pay obligations as they cone duo, To the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated cash requiretiments. 2 2/13/2013 BOYNTON MACE II'OLICE OFFICERS' PRAWN FUND I »viistm nt Polley Stafemtent Custodian: The Board of Trustees has a retained and will continua to retain a thud party to be custodian of the Pund's assets. Ail securities shall be designated as an asset of the Ftind, and no withdrawal of securities -in whole or part -shall be made from safekeeping except by an authorized member of the Board of Trustees or the Board of T designee. Security transactions between a broker dealer and a•custodlan involving the purchase or sale of securities by transfer of money or securities must be made on a "delivery ve. payment" basis, if applicable, to ensure that the custodian will have the money or security, as appropriate, in hand at the ooncluslon of the transaction. Bid requirement: The Trustees shall determine the approxitnatc maturity date based on cash flow . needs and nttnicet conditions, analyze and select one or more optimal types of investment, and competitively bid the security in question whon feasible and appropriate. Except as otherwise required by law, the most economic/illy advswtsgeous bid nwst be selected. Risk and Dlvere(fie tton :. The Investments held by the Fund shall be diversified to the extent practical to control the risk of loss resulting from over- concanlmtton of assets ht a specific maturity, issuer, issuer, instrument, dealer, or bank which financial instruments are bought and sold. A. Authorized lfgveatmento 1. Cotnmingtel equity, fixed income, money market, and alternative (real estate, listed mfrs tnrcture, commodities) finds and institutional mutual funds whose Investments are restricted to securities nraeting the mrkeria outlined in Section 313. . 13. Ptnitaatloas 1. illiquid investments, as described in Chapter 215.47, • Florida Statutes, are prohibited. 2. Foreign investments are limited to 25% of the total pension fund, at market. 3. All repurchase agreement transactions shall adhere to the requirements of the Master Repurchase Agreement. 4. Under Protecting Florida's Lrvestmont•Act ("PFIA "), scrutinized companies published by the State Board. of Administration are prohibited, unless an indirect irnresunonl is unable to divest, as provided for in Florida Statutes section 215 473. 5. The following investments are prohibited, unless authorized by the Trustees: a. Fittrtea (exceptions are mutual and commiogted funds) • b. General obligations issued by a foreign government c.' Hedge Funds d, Insurance annuities 3 2/13/2013 • B OYNTON BRACH POLICE OFFICERS' PENSION FUND Inveshnent Polley Statement e. Internally managed assets f. Limited pnrtnerahlps g. Margot Accounts h. Options (exceptions are mutual and commingled funds) 1. Private equity j. Private mortgages 4. COMMUNICATIONS A. The custodian shall apprise the Trustees of all transactions and shall forward ail proxies to the Westmont manager(s) within teua calendar days. On a monthly • basis, the custodian shall supply an accounting statement that will include a summary of all receipts and disbursements and the cost end the market value of all assets. On a quarterly basis, the investment managers) or investment monitor /consultant shalt provide a written report affirming compliance with the security restrictions and a summary of common stock diversification and attendant schedules. The Investment managers) shall deliver each quarter a report detailing the Fund's performance, ndherence to the Investment policy statement, forecast of the market and economy, portfolio analysis and current assets of the Trust. Written reports and personal presentations shall be delivered to the Trustees within 60 days of the end of the quarter. The investment managers) will provide immediate written and/or telephone notice to the Trustees of any significant market related or non - market related event, specifically including, but not limited to, any deviation from the atanderds set forth in Section 3B above. B. The investment manager(s) will disclose any securities that are not in compliance with Section 313 in each quarterly report. C. The Trustees shall retain a monitoring service to evaluate and report on a quarterly basis the rate of return and relative performance of the Rind. D. The Trustees will meet quarterly with the investment monitor /consultant to review the Performance Report, The 'rotates will meet .with the tnvosttnent ranger(,) and investment monitor /consultant to discuss performance results, economic outlook, investment strategy and tactics and other pertinent matters affecting the - Fund on a quarterly basis. B, The equity investment manager shall report to the Trustees on an annual basis with respect to proxies, the issues, votes and dates, and if not voted, a written explanation. • 5, CRITERIA FOR INVESTMENT MANAGER REVIEW The Board of Trustees wish to adopt standards by which judgments of the ongoing performance of an investment manager may be made. With this in mind, the following are adopted: 4 2!13/2013 BOYNTON BEACH POLI'CB OFPICRRS' PENSION FUND Invesisaant Polt®y Slatemont If, at any tuna, any one of the following is breached, the Investment manager(s) will be warned of the Trustee's serious concern for the Fund's continued safety and performance. A, Four consecutive quarters of the investment manager's performance below the 40'" percentile in appropriate performance rankings. I3. Standard deviation for the Fund in excess of 120% of the market, C. Loss by the Investment inattager(s) of any senior investment personnel. D. Any change in basis investment philosophy by the investment manager(s). 13. Failure to attain a majority vote of confidence by the Board of Trustees. R Failure to observe the security duality restrictions itt Section 3B. • 6. INTERNAL CONTROLS The Fund shall be governed by a set of written internal controls and operational procedures, which shall be. periodically reviewed by the Fund's eertlfled public accountant (CPA). At the time of every financial audit, the CPA shall review the controls that should be - designed to prevent loss of funds that might arise from fraud, etror, or misrepresentation by third parties or imprudent actions by the Trustees or the employees of the City of Boynton Beach. '1. CONTINUING RDUCATION The Fund acknowledges the importance of continuing educetlon for the Trustees, Ongoing education will be provided by the Fiend's actuary, attorney, custodian, investment manager(s), Investment monitor/consultant, and administrator, In addition, the Trustees are encouraged to attend educational conferences in connection with their duties and responsibilities as Trustees. Bach Trustee is encouraged to attend a minimum of two conferences or seminars per year. Additional conferences or seminars are also encouraged. Bach Trustee may attend up to six conferences in state and two conferences out -of- state, every year, without additional Board approval. 8. FLORIDA STATUTES 112, 185 AND APPLICABLE CITY OF BOYNTON BEACH ORDINANCES If at any time, this document found to be in conflict with Chapter 112,661 or Chapter 18S, Florida Statutes, or the applicable City of Boynton Beach Ordinances, the Statutes and OadiirantQs adaali prevail. 9, PROXY VOTING In general, proxies shall be voted in accordance with the Trustees proxy policy, which Is s 2/13/2013 j { . BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Pdfiay Statement "The Board of Trustees of the CITY OF BOYNTON BEACH POLICE OFFICER'S PENSION FUND recognizes that proxy voting powers are an asset of the Band and must be exercised far the exclusive benefit of the participants hi the Fiund ". On a regular basis, no less frequently than annually, the investment manareer(s) shell report a record of his or her proxy vote. 10, REVIEW AND AMENDMENTS It is the Trustees intention to review this document periodically and to amend this statement to reflect any change3 in philosophy, objectives or guidelines. In this regard, the investment manager's interest in consistency in these natters is recognized and wilt be taken into account when changes are being considered. If at any time any investment manager feels that the specific objectives defined herein cannot be met, or the guidelines constrict performance, the Trustees should be notified In writing, By initial and continuing aooeptanee of this Investment Policy Statement, the Investment manager(s) concurs with the pe+ovlsions of this document. Once the Trustees have adopted the investment policy statement, the Westmont policy statement shall bo promptly filed with the Department of Management Services, the Fund sponsor, and the consulting actuary. The effective date of the investment Policy Statement and any amendment thereto shall be the 3 ist calendar day following the filing date with the plan sponsor. 11, ASSET ALLOCATION Deliberate management of the asset mix among classes of lnnvestments is both a necessary and desirable responsibility. In the allocation of assets, diversification of investments among asset classes that tut not aimllarly affected by economio, political, or social developments is a highly desirable objective. The Fund's general polloy shall be to diversify Investments within both equity and fixed income secnrities so as to provide a balance that will enhance total return, white avoiding undue risk concentrations in any shtgle asset class or investment category. The addition of real assets, such as real estato, commodities and infrastructure, to the equity /fixed income portfolio may rnatedalty Improve the ability of the portfolio to dominate inflation over the long -term, As a collection, real assets diversify each other and to equities and fixed income. Real assets may offer the potential for attractive levels of return. in making asset allocation Judgments, It is eat expected that the Trustees will necessarily seek to "time" subtle changes In markets, or that frequent or minor adjustments would be needed.. Instead, it is expected to develop and adopt expressed guidelines for broad allocations on a tong -term basis, in light of current and projected investment onvkonnteuts. To insure broad diversification in the long -term investment portfolios among the major categories of investments, asset allocation, as n percent of the total market value of the total long term portfolio, will be set with the following target percentage: 6 2/13/2013 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Inrestmont Polity Slatement • Strategic Allocation Policy Rattgo Allocation Asset Class/Strategy ( %) (%) &tellies 48 30 -70 Fixed Income 35 30--40 Cask/Money Market 2 0 -- 5 Alternatives: 15 2 — 20 Total 100 ALTERNATIVES Private Real Estate 5 0 — Public Real Estate (REfls) 5 0 -- 7 - Listed Infrastnwture 0 0--5 Comjuodiies (CCFs) 5 0 -7 NOTE! Foreign securities are limited to 2396 of Ma radon m at market valves 12. PROCEDURE FOR REBALANCING ASSET ALLOCATION At the end of each month, Russell Investments will compare the Fund's asset values and their relative allocation percentages, to the rebalancing policy targets and ranges. Based on this comparison, Russell Investments will determine what trades are necessary in order to bring the investments as close to target as practical. BOYNTON BEACH POLICE OFFICERS' RUSSELL INVESTMENTS M!<ENTS PE FUND 0ctl As: Chakrnaa, Board ofTsustees As: InvesTment Manager Date: e3 i!5f • t 3 Date: Y.4/ / 3 BURGERS CHAMBERS.& ASSOCIATES, INC. As: riser Date: y 1/ 13 • 7 2/13/2013 BOYNTON BEACH POLICE OFFICERS' PENSION FUND FINANCIAL STATEMENTS September 30, 2013 and 2012 DAVIDSON, JAMIESON & CRISTINI, P.L. Certified Public Accountants BOYNTON BEACH POLICE OFFICERS' PENSION FUND TABLE OF CONTENTS PAGE INDEPENDENT AUDITOR'S REPORT 1 FINANCIAL STATEMENTS STATEMENTS OF FIDUCIARY NET POSITION 3 STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION 4 NOTES TO FINANCIAL STATEMENTS 5 REQUIRED SUPPLEMENTAL INFORMATION SCHEDULE OF FUNDING PROGRESS 22 SCHEDULE OF CONTRIBUTIONS FROM THE CITY 23 NOTES TO THE ADDITIONAL SCHEDULES 24 ADDITIONAL INFORMATION SCHEDULES OF INVESTMENT AND ADMINISTRATIVE EXPENSES 25 i Davidson, Jamieson & Cristini, P.L. Certified Public Accountants 1956 Bayshore Boulevard Dunedin, Florida 34698 -2503 (727)734 -5437 or 736 -0771 FAX (727) 733 -3487 Member Members of the Firm American Institute of John N Davidson, CPA, CVA Certified Public Accountants Harry B Jamieson, CPA Flonda Institute of Richard A Cristini, CPA, CPPT, CGFM Certified Public Accountants Jeanine L Bittinger, CPA, CPPT The Board of Trustees Boynton Beach Police Officers' Pension Fund Boynton Beach, Florida INDEPENDENT AUDITOR'S REPORT Report on Financial Statements We have audited the accompanying financial statements of Boynton Beach Police Officers' Pension Fund (Plan), which comprise the statements of fiduciary net position as of September 30, 2013 and 2012, and the related statements of changes in fiduciary net position for the years then ended, and the related notes to the financial statements. Management's Responsibility for the Financial Statements The Plan's Board of Trustees is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error, in making those risk assessments, the auditor considers internal control relevant to the Plan's preparation and fair presentation of the financial statements, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. 1 The Board of Trustees Boynton Beach Police Officers' Pension Fund Boynton Beach, Florida Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the fiduciary net position of the Boynton Beach Police Officers' Pension Fund as of September 30, 2013 and 2012, and the changes in fiduciary net position for the years the ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying required supplementary information on pages 22 through 24 of the Boynton Beach Police Officers' Pension Fund is required by Governmental Accounting Standards Board Statement No. 25 and is not a required part of the basic financial statements. The additional information on page 25 is presented for purposes of additional analysis and is also not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the above information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management has omitted the Management's Discussion and Analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information. Vii )„:14,10,494 oc444444 December 19, 2013 2 BOYNTON BEACH POLICE OFFICERS' PENSION FUND STATEMENTS OF FIDUCIARY NET POSITION September 30, 2013 and 2012 Assets 2013 2012 Cash $ 25,894 $ 10,319 Receivables: DROP loans 173,596 1 15,706 Broker - dealers 348383 307,501 Total receivables 522,379 423,207 Investments at fair value: Multi manager bond investment fund 20,759,282 18,375,166 Multi asset core investment fund 27,141,597 40,015,863 Large capital defensive equity investment fund 17,672,434 - Real estate investment fund 3,042,335 2,711,711 Temporary investments - 5,875 Total investments 68,615,648 61,108,615 Prepaid expenses 5,998 5,715 Total assets 69,169,919 61,547,856 Liabilities Accounts payable 141,953 119,246 Total liabilities 141,953 119,246 Net position restricted for pensions $ 69,027,966 $61,428,610 See Notes to Financial Statements. 3 BOYNTON BEACH POLICE OFFICERS' PENSION FUND STATEMENTS OF CHANGES IN FIDUCIARY NET POSIITON Years ended September 30, 2013 and 2012 Additions: 2013 2012 Contributions: Employer $ 4,236,485 $ 3,633,868 Plan members 902,696 928,983 Plan members, buy -back 88,220 15,440 Rollover to DROP 126,821 135,291 Total contributions 5,354,222 4,713,582 Intergovernmental revenue: Chapter 185 state excise tax rebate 619,853 595,919 Total intergovernmental revenue 619,853 595,919 Investment income (loss): Net appreciation (depreciation) in fair value of investments 6,632,321 9,660,380 Interest 5,185 7,849 Dividends - 20 Other 1,358 1,221 Total investment income 6,638,864 9,669,470 Less investment expenses 519,021 364,647 Net investment income (loss) 6,119,843 9,304,823 Total additions 12,093,918 14,614,324 Deductions: Benefits: Age and service 3,530,394 3,320,774 Disability 337,374 355,142 Beneficiaries 63,945 67,021 Drop payments 389,249 659,751 Refunds 67,665 53,277 Administrative expenses 105,935 122,756 Total deductions 4,494,562 4,578,721 Net increase in net position 7,599,356 10,035,603 Net position restricted for pensions: Beginning of year 61,428,610 51,393,007 End of year $ 69,027,966 $ 61,428,610 See Notes to Financial Statements. 4 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 1. Description of the Plan The following brief description of the Boynton Beach Police Officers' Pension Plan (Plan) is provided for general information purposes only. Participants should refer to the Plan Agreement for more complete information. General - The Plan was created in 1981 by Section 18 of an Ordinance adopted by the City of Boynton Beach, Florida. This Ordinance was substantively amended in 2001, 2002, 2006 and 2009. The Plan is a defined benefit pension plan covering all full -time police officers of the City of Boynton Beach, Florida (City). Participation in the Plan is required as a condition of employment. The Plan provides for pension, death and disability benefits. In addition, the Plan is a local law plan subject to provisions of Chapter 185 of the State of Florida Statutes. The Plan, in accordance with the above statutes, is governed by a five member pension board. Two police officers, two City residents and a fifth member elected by the other four members constitute the pension board. The City and the Plan participants are obligated to fund all Plan costs based upon actuarial valuations. The City establishes benefit levels while the board establishes the actuarial methods followed by the Plan. During the fiscal year ended September 30, 2013 the Plan's membership consisted of: Retirees and beneficiaries: Currently receiving benefits 106 Drop Retirees 49 Terminated employees entitled to benefits but not yet receiving them 4 Total 159 Current employees: Vested 65 Nonvested 90 Total 155 At September 30, 2012, the date of the most recent actuarial valuation, there were 103 retirees and beneficianes receiving benefits. 5 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 1. Description of Plan (Continued) Pension Benefits - The pension plan provides retirement, death and disability benefits for its participants. A participant may retire with normal benefits after reaching age 55 and accumulating 10 or more years of credited service, at 20 years of service without regard to age, or at age 50 with 15 years of credited service. Normal retirement benefits are based on 3.5% of the participant's final average salary times the number of his or her credited years of service. The final average salary for purposes of calculating benefits is the participant's average salary during the five highest years of the last ten years of creditable service prior to retirement. A participant with 10 or more years of credited service is eligible for deferred retirement. These benefits begin upon application on or after reaching age 55 and are computed the same as normal retirement, based upon the participant's final average salary and credited service at the date of termination. Benefits are reduced 1.5% per year for each year by which the participant's age at retirement preceded the participant's normal retirement age. Monthly Supplemental Retirement Benefit - Effective October 1, 2006, any retiree or beneficiary receiving pension benefits is entitled to a monthly supplemental pension benefit. The benefit pool will be funded by 100% of the annual earnings and 10% of the principal created by the contributions received. The benefit pool shall be divided according to the total number of years of service rendered by all retirees, with a cap of 40 years. The shares will be divided on a pro -rata basis as defined in the ordinances. The supplemental benefits was to be funded by a 1% contribution from the Members and a 1% contribution by the City. Effective with the Chapter 185 monies received for calendar year 2001, the excess Chapter 185 dollars will be allocated to fund the City's contributions until the Chapter 185 dollars are received for calendar year 2005 or, if earlier, until the entire 1% of the City contributions are covered by the increase in the Chapter 185 monies. Employees will contribute to this benefit through 20 years of service. The actuarial value of the monthly supplemental benefit reserve at September 30, 2012 was approximately $1,839,975. 6 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 1. Description of Plan (Continued) Deferred Retirement Option Plan - Any Plan participant who is eligible to receive a normal retirement pension may elect to participate in a deferred retirement option plan (DROP) while continuing his or her active employment as a police officer. Upon participation in the DROP, the participant becomes a retiree for all Plan purposes so that he or she ceases to accrue any further benefits under the pension plan. Normal retirement payments that would have been payable to the participant as a result of retirement are accumulated and invested in the DROP to be distributed to the participant upon his or her termination of employment. The Plan provides for a participant to elect a partial lump sum withdrawal. Participation in the DROP ceases for a Plan participant after the earlier of 5 years or the attainment of 30 years of service. An employee's account in the DROP program shall earn interest in one of two ways. The selection of the earnings program shall be irrevocable and shall be made prior to the first deposit into the DROP account. The options are summarized as follows: A. Gain or loss interest at the same rate as the Plan; or, B. At an annual fixed rate of seven percent (7 %); or, C. A combination of both A and B. Participants, (after separation from service) may borrow from their DROP accounts a minimum of $5,000 up to a maximum equal to the lesser of $50,000 or 50 percent of their DROP account balance. The loans are secured by the balance in the members' DROP account and bear interest at the lowest bank rate at the issue date for the loan. Principal and interest is paid ratably through monthly payments. Disability Benefits - Disability benefits for service related disabilities are paid to a participant for life. Benefits are calculated as 66 2/3% of the participant's salary at the time of disability. This amount is reduced by any social security and workers' compensation benefits received and will not be less than 42% of the participant's average final salary. Disability benefits for non - service related disabilities are paid to a participant for life. Benefits are calculated at a minimum of 25% of the participant's final average salary. Death Benefits - Preretirement death benefits for participants with at least 10 years of service are payable until the death of the spouse. The spouse will receive the accrued normal retirement benefit taking into account compensation earned and service credited as of the date of death with a minimum benefit equal to 30% of average final compensation. Beneficiaries of participants who die prior to vesting will receive a refund of the participants accumulated contributions. 7 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 1. Description of Plan (Continued) Post retirement death benefits are payable to the participant's eligible widow depending on the survivor's benefit selected. Refund of Participant Contributions - A participant who terminates employment and is ineligible for pension benefits is refunded his or her contribution without interest. 2. Summary of Significant Accounting Policies Basis of Accounting - Basis of accounting is the method by which revenues and expenses are recognized in the accounts and are reported in the financial statements. The accrual basis of accounting is used for the Plan. Under the accrual basis of accounting, revenues are recognized when they are earned and collection is reasonably assured, and expenses are recognized when the liability is incurred. Plan member contributions are recognized in the period in which the contributions are due. City contributions to the plan as calculated by the Plan's actuary, are recognized as revenue when due and the City has made a formal commitment to provide the contributions. Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. Basis of Presentation - The accompanying financial statements are presented in accordance with Governmental Accounting Standards Board (GASB) Statement 25, Financial Reporting for Defined Benefit Pension Plans and Note Disclosures for Defined Contribution Plans and the Codification of Governmental Accounting and Financial Reporting Standards which covers the reporting requirements for defined benefit pensions established by a governmental employer. The accompanying financial statements include solely the accounts of the Plan which include all programs, activities and functions relating to the accumulation and investment of the assets and related income necessary to provide the service, disability and death benefits required under the terms of the Plan Ordinance and the amendments thereto. Valuation of Investments - Investments in investment funds common stock and bonds traded on a national securities exchange are valued at the last reported sales price on the last business day of the year; securities traded in the over - the - counter market and listed securities for which no sale was reported on that date are valued at the mean between the past reported bid and asked prices; investments in securities not having an established market value are valued at fair value as determined by the Board of Trustees. The fair value of an investment is the amount that the Plan could reasonably expect to receive for it in a current sale between market participants, other than in a forced or liquidation sale. Purchases and sales of investments are recorded on a trade date basis. 8 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 2. Summary of Significant Accounting Policies (Continued) Investment income is recognized on the accrual basis as earned. Unrealized appreciation in fair value of investments includes the difference between cost and fair value of investments held. The net realized and unrealized investment appreciation or depreciation for the year is reflected in the Statement of Changes in Plan Net Assets. Custody of Assets - Custodial and investment services are provided to the Plan under contract with the Russell Trust Company. The Plan's investment policies are governed by Florida State Statutes and ordinances of the City of Boynton Beach, Florida. Authorized Plan Investments - The Board recognizes that the obligations of the Plan are long -term and that its investment policy should be made with a view toward performance and return over a number of years. The general investment objective is to obtain a reasonable total rate of return defined as interest and dividend income plus realized and unrealized capital gains or losses commensurate with the prudent investor rule and Chapter 185 of the Florida Statutes. Permissible investments include obligations of the U.S. Treasury and U.S. agencies, high capitalization common or preferred stocks, pooled equity funds, high quality bonds or notes, foreign securities and fixed income funds. In addition, the Board requires that Plan assets be invested with no more than 65% in stocks and convertible securities measured at cost at the end of each reporting period. Further information regarding the permissible investments from the Plan can be found in the Statement of Investment Policies. Actuarial Cost Method - The Plan' s actuarial cost method id the Entry Age Normal Method for funding purposes. This method allocates the actuarial present value of each participant's projected benefit on a level basis over the participant's earnings from the date of entry into the Plan through the date of retirement. Reporting Entity - The financial statements presented are only for the Plan and are not intended to present the basic financial statements of the City of Boynton Beach, Florida. The Plan is included in the City's Comprehensive Annual Financial Report (CAFR) for the years ended September 30, 2013 and 2012, which are separately issued documents. Anyone wishing further information about the City is referred to the City's CAFR. The Plan is a pension trust fund (fiduciary fund type) of the City which accounts for the single employer defined benefit pension plan for all City Police Officers. The provisions of the Plan provide for retirement, disability, and survivor benefits. 9 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 2. Summary of Significant Accounting Policies (Continued) Funding Policy - Participants are required to contribute 7.0% of their annual earnings to the Plan. Prior to 1986, contributions to the Plan were made on an after -tax basis. Subsequent to this date, contributions are made on a pre -tax basis pursuant to an amendment to the Plan. These contributions are designated as employee contributions under Section 414(h)(2) of the Internal Revenue Code. Contribution requirements of the Plan's participants are established and may be amended by the City of Boynton Beach, Florida. A rehired member may buy back one or more years of continuous past service by paying into the Plan the amount of contributions that the participant would otherwise have paid for such continuous past service, plus the interest that would have been earned had such funds been invested by the Plan during that time. The City's funding policy is to make actuarially computed monthly contributions to the Plan in amounts, such that when combined with participants' contributions and the State insurance excise tax rebate, all participants' benefits will be fully provided for by the time that they retire. The City's actuarially determined contribution rate for the years ended September 30, 2013 and 2012 was 32.08% and 33.05 %, respectively This rate consists of 18.28% and 17.16% of member salaries to pay normal costs plus 13.80% and 15.89% to amortize the unfunded actuarially accrued liability pursuant to the September 30, 2012 actuarial valuation. Administrative Costs - All administrative costs of the Plan are financed through employee and City contributions. Cash - The Plan considers money market and demand account bank and broker - dealer deposits as cash. Temporary investments, shown on the balance sheet are composed of investments in short-term custodial proprietary money market funds. Federal Income Taxes - A favorable determination letter indicating that the Plan is qualified and exempt from Federal income taxes was not issued by the Internal Revenue Service. The Board believes that the Plan is designed and continues to operate in compliance with the applicable requirements of the Internal Revenue Code. 10 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 2. Summary of Significant Accounting Policies (Continued) Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Subsequent Events - Management has adopted the provisions set forth in GASB Statement No. 56, Subsequent Events and considered subsequent events through the date of the audit report which is the date that the financial statements were available to be issued. Restatement - Certain figures in the financial statements for the fiscal year ended September 30, 2012 have been restated to conform to the presentation used in the financial statements for the fiscal year ended September 30, 2013. 3. Deposits and Investments Deposits At year end September 30, 2013 the carrying amount of the Plan's deposits was $25,894 and the bank balance was $26,614. The bank balance was covered by federal depository insurance and, for the amount in excess of such federal depository insurance, by the State of Florida's Security for Public Deposits Act. Provisions of the Act require that public deposits may only be held at qualified public depositories. The Act requires each qualified public depository to deposit with the State Treasurer eligible collateral equal to or in excess of the required collateral as determined by the provisions of the Act. In the event of a failure by a qualified public depository, losses in excess of federal depository insurance and proceeds from the sale of the securities pledged by the defaulting depository, are assessed against the other qualified public depositories of the same type as the depository in default. Russell Trust Company (Russell) periodically holds uninvested cash in its capacity as custodian for the Plan. These funds exist temporarily as cash in the process of collection from the sale of securities or investments. 11 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 3. Deposits and Investments (Continued) Investments Investments that are not evidenced by securities that exist in physical or book - entry form include investments in open -ended alternative investment funds. The Plan's investments other than cash held by its administrative manager, are segregated into a separate account and managed under a separate investment agreement with Russell Investment group. This agreement gives Russell custodianship and the authority to manage the investments. These assets are invested in accordance with the specific investment guidelines as set forth in the Plan's Investment Policy Statement. Investment management fees are calculated quarterly as a percentage of the fair market value of the Plan's assets managed. The Plan's investments are uninsured and unregistered and are held in custodians' or the Bank's accounts in the Plan's name. Multi Asset Core Funds, Multi Manager Bond Funds and real estate investment funds are privately placed funds, which operates as alternative investments which offer their shares at the net asset value (NAV) of the funds. The alternative investment funds invest in equity, fixed, international and real estate investments. The investments in the underlying funds are generally valued at fair value as determined by the management of the fund by reference to the value of the underlying fund's assets, if available, or by the valuation of a fund's underlying assets as provided by the general partner or investment manager, if the assets are not publicly traded. The fund may also hold certain investments which may be valued by a single market maker. While the fund managers use their best judgment in estimating the fair value of underlying funds, there are inherent limitations in any estimation technique. Accordingly the fair value of alternative investment funds have been estimated by the Plan's management in the absence of readily ascertainable market values. Therefore, the values of such funds are not necessarily indicative of the amount that could be realized in a current transaction. The fair values may differ significantly from the values that would have been used had a ready market for the underlying funds existed, and the difference could be material. Future confirming events will also affect the estimates of fair value, and the effect of such events on the estimates of fair value could be matenal. 12 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 3. Deposits and Investments (Continued) Investments (Continued) The alternative investment fund expose the Plan to certain risks, including liquidity risks, counterparty risks, foreign political economic, and governmental risks, and market risk. In addition, these investments may have initial lock -up periods, as well as restrictions for liquidating positions in these funds, that make the investment non - current and non- marketable. The alternative investments are valued using the net asset value (NAV) provided by the investment managers of these funds. The NAV is based on the value of the underlying assets owned by the fund minus its liabilities and then divided by the number of shares or percentage of ownership outstanding. The NAV's unit price is quoted on a private market that is not active; however, the unit price is based on underlying investments which are traded on an active market. The values of these alternative investments are not necessarily indicative of the amount that could be realized in a current transaction. The fair value may differ significantly from the value that would have been used had a ready market for the underlying funds existed, and the differences could be material. Future confirming events will also effect the estimates of fair value and the effect of such events on the estimated fair value could be material. The Plan had no investments that individually represented 5% or more of the Plan's net assets available for benefits as of September 30, 2013. Further, the Plan has no instrument that, in whole or in part, is accounted for as a derivative instrument under GASB statement No. 53, Accounting and Financial Reporting for Derivative Instruments during the current Plan year. 13 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 3. Deposits and Investments (Continued) Investments (Continued) The Plan held the following fixed income investments as of September 30, 2013: 2013 Rating Standard Effective Fair & Duration Investment Type Value Poor' s (Years) Multi manager bond investment fund $ 20,759,282 AA 5.2 Total $ 20,759,282 Interest Rate Risk - Interest rate nsk is the risk that changes in interest rates will adversely affect the fair value of an investment in debt securities. Generally, the longer the time to maturity, the greater the exposure to interest rate risk. Through its investment policies the Plan manages its exposure to fair value losses arising from increasing interest rates. The Plan limits the effective duration of its investment portfolio through the adoption of nationally accepted risk measure bench marks. Credit Risk - Credit risk is the risk that a debt issuer will not fulfill its obligations. Consistent with state law the Plan's investment guidelines limit its fixed income investment to a quality rating of `A' or equivalent as rated by one ore more recognized bond rating service at the time of purchase. The Plan's fixed income portfolio may not include more than 10% of its investments in securities having a quality rating of Baa. 14 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 3. Deposits and Investments (Continued) Custodial Credit Risk - Custodial credit risk is defined as the risk that the Plan may not recover cash and investments held by another party in the event of a financial failure. The Plan requires all securities to be held by a third party custodian in the name of the Plan. Securities transactions between a broker - dealer and the custodian involving the purchase or sale of securities must be made on a "delivery vs. payment" basis to ensure that the custodian will have the security or money, as appropriate, in hand at the conclusion of the transaction. The investments in mutual funds and investment partnerships are considered unclassified pursuant to the custodial credit risk categories of GASB Statement No. 3, because they are not evidenced by securities that exist in physical or book -entry form. Investing in Foreign Markets - Investing in foreign markets may involve special risks and considerations not typically associated with investing in companies in the United States of America. These risks include revaluation of currencies, high rates of inflation, repatriation restrictions on income and capital, and future adverse political, social, and economic developments. Moreover, securities of foreign governments may be less liquid, subject to delayed settlements, taxation on realized or unrealized gains, and their prices are more volatile than those of comparable securities in U.S. companies. Foreign Tax Withholdings and Reclaims - Withholding taxes on dividends from foreign securities are provided for based on rates established via treaty between the United States of America and the applicable foreign jurisdiction, or where no treaty exists at the prevailing rate established by the foreign country. Foreign tax withholdings are reflected as a reduction of dividend income in the statement of operations. Where treaties allow for a reclaim of taxes, the Fund will make a formal application for refund. Such reclaims are included as an addition to dividend income. Investing in Real Estate - The Plan is subject to risks inherent in the ownership and operation of real estate. These risks include, among others, those normally associated with changes in the general economic climate, trends in the industry including creditworthiness of tenants, competition for tenants, changes in tax laws, interest rate levels, the availability of financing and potential liability under environmental and other laws. 1 5 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 4. Plan's Funded Status The Plan's funded status as of the September 30, 2012 actuarial valuation is presented below: Actuanal Value of Actuanal Unfunded Assets as a Ratio of the Valuation Actuarial Actuanal Actuanal Percentage of the Annual Unfunded Actuarial Date Value of Accrued Accrued Actuarial Accrued Covered Liability to Covered September 30, Assets Liability Liability Liability Payroll Payroll 2012 $ 52,595 $ 92,351 $ 39,756 57% $ 11,789 337.2% Dollar amounts are In thousands. The required schedule of funding progress immediately following the notes to the financial statements presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits. The actuarial methods and significant assumptions used are summarized as follows: (a) Actuarial cost method - Entry Age Normal (b) Asset valuation method - Five years smoothed market (c) Actuarial assumptions: Investment rate of return - 7.75% Post retirement benefit increases - N/A Projected salary increases - 5.0% to 6.5% depending on age Inflation rate and other general increases - 4.0% (d) Amortization method - Level percent of pay - closed (e) Remaining amortization period - 30 years 16 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 5. Net Increase (Decrease) in Realized and Unrealized Appreciation (Depreciation) of Investments The Plan's investments appreciated (depreciated) in value during the years ended September 30, 2013 and 2012 as follows:: 2013 Realized Unrealized Appreciation Appreciation (Depreciation) (Depreciation) Total Investments at fair value as determined by quoted market price. Multi manager bond investment fund $ 73,950 $ (158,331) $ (84,381) Multi asset core investment fund 3,402,570 3,173,849 6,576,419 Large capital defensive equity investment fund - (190,341) (190,341) Real estate equity investment fund - 330,624 330,624 Net increase (decrease) in realized and unrealized appreciation (depreciation) of investments $ 3,476,520 $ 3,155,801 $ 6,632,321 2012 Realized Unrealized Appreciation Appreciation (Depreciation) (Depreciation) Total Investments at fair value as determined by quoted market price. Multi manager bond investment fund $ 936,902 $ 739,722 $ 1,676,624 Multi asset core investment fund 6,143,939 1,151,250 7,295,189 Real estate equity investment fund 440,361 248,206 688,567 Net increase (decrease) in realized and unrealized appreciation (depreciation) of investments $ 7,521,202 $ 2,139,178 $ 9,660,380 17 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 5. Net Increase (Decrease) in Realized and Unrealized Appreciation (Depreciation) of Investments (Continued) The calculation of realized gains and losses is independent of the calculation of net appreciation (depreciation) in the fair value of plan investments. Unrealized gains and losses on investments sold in 2012 that had been held for more than one year were included in net appreciation (depreciation) reported in the prior year. 6. Investments The Plan's investments at both carrying value and cost or adjusted cost as of September 30, 2013 and 2012 are summarized as follows: 2013 2012 Market Market Investment Cost Value Cost Value Multi manager bond investment fund $ 16,777,453 $ 20,759,282 $ 14,267,284 $ 18,375,166 Multi asset core investment fund 22,816,498 27,141,597 38,864,613 40,015,863 Large capital defensive equity Investment fund 17,862,774 17,672,434 - - Real estate equity investment fund 2,700,000 3,042,335 2,700,000 2,711,711 Commodity fund - - - - Temporary investments - - 5,875 5,875 Total investments $ 60,156,725 $ 68,615,648 $ 55,837,772 $ 61,108,615 1 8 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 7. Designations A portion of the plan's net assets are designated for benefits that accrue in relation to the DROP account as further described in Note 1. Allocations to the DROP plan account for the year ended September 30, 2013 are presented below as determined in the Plan's most recent accounting and valuation available for the fiscal year ended September 30, 2013: 2013 Designated for DROP accounts (fully funded) $ 8,058,513 Designated for the supplemental pension distribution reserve 1,839,975 Total designated net position 9,898,488 Undesignated net position 59,129,478 Total plan net position $ 69,027,966 8. Plan Assumption Changes The Actuarial assumptions which were implemented beginning October 1, 2011 are summarized as follows: A. The investment return rate was changed from 8% to 7.75 %. B. The retirement rates in the first year of eligibility for normal retirement have been reduced from 80% to 40 %. C. The mortality table has been updated to the RP -2000 Combined Health Participant Mortality Tables. D. The rates of separation from active membership have been updated from the prior year's rates. During the fiscal year ended September 30, 2011 the Plan's assumptions were changed to provide annual distributions to certain retirees. These distributions will be paid from excess Chapter 185 premium tax revenues. The Plan's actuary has determined that the use of these funds does not impact the funding requirements of the Plan. These revision (B through D) are being phased in over a five year period beginning with the October 1, 2011 actuarial valuation. l9 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 9. Plan Termination Although it has not expressed an intention to do so, the City may terminate the Plan at any time by a written ordinance of the City Commission of Boynton Beach, duly certified by an official of the City. In the event that the Plan is terminated or contributions to the Plan are permanently discontinued, the benefits of each police officer in the Plan at such termination date would be non - forfeitable. 10. Commitments and Contingencies As described in Note 1, certain members of the Plan are entitled to refunds of their accumulated contributions, without interest, upon termination of employment with the City prior to being eligible for pension benefits. At September 30, 2013, aggregate contributions from active members of the Plan were approximately $6,696,000. The portion of these contributions which are refundable to participants who may terminate with less than ten years of service has not been determined. 11. Risk and Uncertainties The Plan invests in a variety of investment funds. Investments in general are exposed to various risks, such as interest rate, credit, and overall volatility risk. Due to the level of risk associated with certain investments, it is reasonably possible that changes in the values of investments will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for benefits. 12. DROP Loans During the fiscal year ended September 30, 2013, certain DROP participants borrowed from their respective DROP accounts. These loans require repayment in sixty months at interest rates based on the interest rate published by an established local bank at the time that the loan was issued. 20 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2013 and 2012 12. DROP Loans (Continued) A schedule of the changes of these loans is summarized as follows: Balance Balance 9/30/12 Additions Repayments 9/30/13 DROP Loans Receivable September 30, 2013 $ 115,706 $ 107,000 $ 49,110 $ 173,596 Future minimum annual principal payments on these loans are as follows: September 30 2014 $ 55,353 2015 41,685 2016 36,138 2017 22,812 2018 17,608 Total $ 173,596 Loan interest income for the year ended September 30, 2013 was $5,185. 13. Rent Expense The Fund and Boynton Beach Firefighters' Pension Fund are obligated under a joint rental operating lease for office space, which expires on September 30, 2014. The base rent of the lease is $981 per month plus applicable sales taxes and is prorated 50/50 for each plan, respectively. During the years ended September 30, 2013 and 2012, rent expense for the Fund under the lease agreement was $7,279 and $5,716, respectively. 14. Plan Amendments The Plan was not amended during the fiscal years ended September 30, 2013 and 2012. 21 REQUIRED SUPPLEMENTARY INFORMATION BOYNTON BEACH POLICE OFFICER' PENSION FUND SCHEDULE OF FUNDING PROGRESS September 30, 2003 through September 30, 2012 Actuarial Accrued (Funded) Active UAAL as Actuarial Actuarial Liability Unfunded Participant Percentage of Valuation Value (AAL) AAL Funded Covered Active Participant Date of Assets Entry Age (UAAL) Ratio Payroll Covered Payroll September 30 (a) (b) - (b -a) a/b (c) (b- a) /(c) 2003 $ 33,206 $ 44,029 $ 10,823 75 4 $ 7,917 136.7% 2004 34,496 48,154 13,658 716 7,207 189.5 2005 35,445 56,691 21,246 62 5 7,836 271 1 2006 37,692 61,468 23,776 613 9,302 255.6 2007 41,981 66,069 24,088 63.5 10,297 233.9 2008 44,278 72,350 28,072 61 2 11,533 243 4 2009 46,117 78,055 31,938 591 12,538 254.7 2010 48,130 81,957 33,828 587 12,136 278.8 2011 49,116 89,656 40,540 54 8 12,397 327.0 2012 52,595 92,351 39,756 57.0 11,789 337.2 Dollar amount are In thousands Analysis of the dollar of actuarial value of assets , actuarial accrued liability, or unfunded actuarial accrued liability in isolation can be misleading. Expressing the actuarial value of assets as a percentage of the actuarial accrued liability provides one indication of the system's funded status on a going- concern basis. Analysis of this percentage over time indicates whether the system is becoming financially stronger or weaker. Generally, the greater this percentage, the stronger the plan. The unfunded actuarial accrued liability and annual covered payroll are both affected by inflation. Expressing the unfunded actuarial accrued liability as a percentage of covered payroll approximately adjusts for the effects of inflation and aids analysis of the progress being made in accumulating sufficient assets to pay benefits when due. Generally, the smaller this percentage, the stronger the plan. 22 BOYNTON BEACH POLICE OFFICER' PENSION FUND SCHEDULE OF CONTRIBUTIONS FROM THE CITY September 30, 2004 through September 30, 2013 City Year Actual Ended Required Percentage September 30 Contribution Contributed 2004 $ 2,343,601 100.0% 2005 2,571,109 100.0 2006 2,808,957 100.0 2007 3,030,547 100.0 2008 3,236,241 100.0 2009 3,245,082 100.0 2010 3,688,516 100.0 2011 3,552,348 100.0 2012 3,633,868 100.0 2013 4,236,485 100.0 23 BOYNTON BEACH POLICE OFFICER' PENSION FUND NOTES TO THE ADDITIONAL SCHEDULES September 30, 2003 through September 30, 2013 The information presented in the supplementary schedules on pages 22 and 23 was determined as part of the actuarial valuations at the dates indicated. Additional information as of the latest actuarial valuation follows: Valuation date October 1, 2012 Actuarial cost method Entry Age Normal Amortization method Level percent of payroll, closed Remaining amortization period 30 years Asset valuation method Five year smoothed market Actuarial assumptions: Investment rate of return 7.75% Projected salary increases 5.0% to 6.5% depending on age Inflation and other general increases 4.0% Cost of living adjustments N/A The activities of the Pension Plan and its members generated an experience (net actuarial) gain of $2,249,576 during the plan year ended September 30, 2012, which decreased the City's contribution requirements by 1.01% of covered payroll. The pnncipal source of the gain was lower than expected salary increases. This gain was partially offset by the recognized return on investments that was less than the assumed investment rate of return. The actuarial return on the actuarial value of the assets was 6.88% versus 7.75% expected. 24 ADDITIONAL INFORMATION BOYNTON BEACH POLICE OFFICERS' PENSION FUND SCHEDULES OF INVESTMENT AND ADMINISTRATIVE EXPENSES Years ended September 30, 2013 and 2012 2013 2012 Investment Admmmstrative Investment Administrative Expenses Expenses Expenses Expenses Expenses Actuary fees $ - $ 19,971 $ - $ 32,963 Administrator's fees - 21,055 - 21,055 Audit fees - 10,500 - 9,700 Bank charges - 90 - 90 Computer service - 5,748 - 5,712 Directors' liability insurance - 11,402 - 10,581 Dues and subscriptions - 600 - 600 Investment managers' fees: Russell Trust Company 499,021 - 344,647 - Legal fees - 11,932 - 10,038 Office expenses - 804 - 1,397 Office rent - 7,279 - 5,716 Pension program maintenance - 3,605 - 2,120 Performance monitor 20,000 - 20,000 - Seminars and trainmg - 8,504 - 20,616 Printing expense - 4,445 - 2,168 $ 519,021 $ 105,935 $ 364,647 $ 122,756 Percentage of plan net position 0.75% 0.15% 0.59% 0.20% 25 G IR.S Gabriel Roeder Smith & Company Consultants & Actuaries CITY OF BOYNTON BEACH MUNICIPAL POLICE OFFICERS' RETIREMENT FUND ACTUARIAL VALUATION REPORT AS OF OCTOBER 1, 2013 ANNUAL EMPLOYER CONTRIBUTION IS DETERMINED BY THIS VALUATION FOR THE PLAN YEAR ENDING SEPTEMBER 30, 2015 GRS Uabriei oed'r One East Broward Blvd 954 527 1616 phone Consulcants �� ncLuai�e� Suite 505 954 525 0083 fax Ft Lauderdale, FL 33301 -1804 www gabrielroedercom February 6, 2014 Board of Trustees City of Boynton Beach Municipal Police Officers' Retirement Fund Boynton Beach, Florida Dear Board Members: The results of the October 1, 2013 Annual Actuarial Valuation of the City of Boynton Beach Municipal Police Officers' Retirement Fund are presented in this report. This report was prepared at the request of the Board and is intended for use by the Retirement System and those designated or approved by the Board This report may be provided to parties other than the System only in its entirety and only with the permission of the Board. The purpose of the valuation is to measure the System's funding progress, to determine the employer contribution rate for the fiscal year ending September 30, 2015, and to determine the actuarial information for Governmental Accounting Standards Board (GASB) Statement No. 25 and No. 27 This report also includes estimated GASB Statement No. 67 information for the fiscal year ending September 30, 2014. This report should not be relied on for any purpose other than the purpose described above. The findings included in this report are based on data or other information through September 30, 2013 Future actuarial measurements may differ significantly from the current measurements presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions, changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. The valuation was based upon information furnished by the Plan Administrator concerning Retirement System benefits, financial transactions, plan provisions and active members, terminated members, retirees and beneficiaries. We checked for internal and year -to -year consistency, but did not otherwise audit the data. We are not responsible for the accuracy or completeness of the information provided by the Plan Administrator. This report was prepared using certain assumptions prescribed by the Board as described in Section B. The undersigned actuaries are members of the American Academy of Actuaries and meet the Qualification Standards of the American Academy of Actuaries to render the actuarial opinions contained herein The signing actuaries are independent of the plan sponsor. This report has been prepared by actuaries who have substantial experience valuing public employee retirement systems To the best of our knowledge the information contained in this report is accurate and fairly presents the actuarial position of the Retirement System as of the valuation date. All calculations have been made in conformity with generally accepted actuarial principles and practices, with the Actuarial Standards of Practice issued by the Actuarial Standards Board and with applicable statutes. This actuarial valuation and /or cost determination was prepared and completed by me or under my direct supervision, and I acknowledge responsibility for the results. To the best of my knowledge, the results are complete and accurate. In my opinion, the techniques and assumptions used are reasonable, meet the requirements and intent of Part VII, Chapter 112, Florida Statutes, and are based on generally accepted actuarial principles and practices. There is no benefit or expense to be provided by the plan and /or paid from the plan's assets for which liabilities or current costs have not been established or otherwise taken into account in the valuation. All known events or trends which may require a material increase in plan costs or required contribution rates have been taken into account in the valuation. Respectfully submitted, GABRIEL, ROEDER, SMITH AND COMPANY t!ilv� 21 • 'bL'?c .—= eter N. Strong, ASA Je'fre Amrose, MAAA Enrolled Actuary No 11-6975 `nrolled Actuary No. 11-06599 Gabriel Roeder Smith & Company TABLE OF CONTENTS Section Title Page A Discussion of Valuation Results 1 Chapter Revenue 5 B Valuation Results 1. Participant Data 6 2. Annual Required Contribution (ARC) 7 3. Actuarial Value of Benefits & Assets 8 4. Calculation of Employer Normal Cost 9 5. Liquidation of the Unfunded Frozen Actuarial Accrued Liability 10 6. Actuarial Gains and Losses 11 7. Actual Compared to Expected Decrements 17 8. Cost of Living Adjustment 18 9. Recent History of Valuation Results 19 10. Recent History of Required and Actual Contributions 20 11. Actuarial Assumptions and Cost Method 21 12. Glossary of Terms 26 C Pension Fund Information 1. Summary of Assets 29 2. Summary of Fund's Income and Disbursements 30 3. Calculation of Actuarial Value of Assets 31 4. Investment Rate of Return 33 D Financial Accounting Information 1. FASB No. 35 34 2. GASB No. 25 35 3. GASB No. 27 37 4. GASB No. 67 39 E Miscellaneous Information 1. Reconciliation of Membership Data 50 2. Age /Service /Salary Distributions 51 F Summary of Plan Provisions 53 GRS SECTION A DISCUSSION OF VALUATION RESULTS GRS 1 DISCUSSION OF VALUATION RESULTS Comparison of Required Employer Contributions A comparison of the required employer contnbution developed in this and the last actuarial valuation is shown below. The required contribution dollar amounts shown below are estimates only. The contribution policy of the City is to contribute the dollar amount determined by multiplying the required percentage of payroll determined as of the valuation date by the projected pensionable payroll for the year. For FYE 9/30/15 For FYE 9/30/14 Based on Based on 10/1/2013 10/1/2012 Increase Valuation Valuation* (Decrease) Required Employer /State Contribution $ 4,830,346 $ 4,560,918 $ 269,428 As % of Covered Payroll 41.73 % 38.54 % 3.19 % Estimated State Contribution $ 465,087 $ 465,087 $ 0 As % of Covered Payroll 4.02 % 3.93 % 0.09 % Required Employer Contribution $ 4,365,259 $ 4,095,831 $ 269,428 As % of Covered Payroll 37.71 % 34.61 % 3.10 % * From September 20, 2013 Actuarial Impact Statement The required employer contnbution has been computed under the assumption that the amount to be received from the State next year will be at least $465,087. The City may not take credit for State revenue in excess of $465,087. If the next payment from the State falls below $465,087, the City must raise its contribution by the difference. The employer contribution listed above is for the City's fiscal year ending September 30. 2015 and has been calculated assuming the employer contnbution is made on October 1, 2014. The actual employer contribution for the fiscal year ending September 30, 2013 was $4,236,485, which was equal to the required contribution. GRS 2 Revisions in Benefits The definition of pensionable salary has been revised to limit overtime pay to 300 hours per year and to limit the amount of accumulated unused sick and vacation pay to the lesser of the hours accumulated as of June 18. 2013 or the amount cashed out at retirement. These changes were reflected in an Actuarial Impact Statement dated September 20, 2013. The results as of October 1, 2012 have been updated to reflect this change. There have been no other revisions in benefits since the last valuation. Revisions in Actuarial Assumptions and Methods The following revisions in actuarial assumptions have been approved by the Board and incorporated into this report ➢ The mortality table, which was updated two years ago to the RP -2000 Combined Healthy Participant Mortality Tables for males and females, including projections for future improvements in mortality rates, continues to be phased in this year. > The assumed withdrawal rates, which were updated two years ago (please see the actuarial assumptions and methods section), continue to be phased in this year. These revisions are being phased in over a five -year period. beginning with the October 1, 2011 actuarial valuation. In this year's actuarial valuation, 60% of the revised rates and 40% of the prior rates are used. In the previous year's actuarial valuation 40% of the revised rates and 60% of the prior rates were used This change caused an increase in the contribution of 1.23% of covered payroll. Actuarial Experience There was a net actuarial gain of $794,394 for the year which means that actual experience was more favorable than expected. The actuanal gam is primarily due to salary increases that were less than expected. Average salary increases were 0.1 %, versus 5.8% expected. This gain was partially offset by recognized return on investments that was less than the assumed investment rate of return. The actual return on the actuarial value of assets was 7.00 %, versus 7.75% expected. The net actuarial gain for the year has caused a decrease m the annual required employer contribution of 0 38% of covered payroll GRS 3 Funded Ratio The funded ratio was 59.1% this year compared to 57.2% last year (in the Actuarial Impact Statement). Before the change in assumptions described above, the funded ratio was 59.4 %. The funded ratio is equal to the actuarial value of assets divided by the actuarial accrued liability. Analysis of Change in Employer Contribution The components of change in the required employer contribution are as follows: Contribution Rate Last Year* 34.61 % Actuarial Experience (0.38) Change in Administrative Expense (0.08) Amortization Payment on UAL 1.67 Change in Payroll Growth Assumption 0.75 Change in State Contribution (0.09) Change in Normal Cost Rate 0.00 Change in Assumptions and Methods 1.23 Contnbution Rate This Year 37.71 *From September 20, 2013 Actuarial Impact Statement Required Contributions in Later Years The current calculated City contribution requirement is 37.71% of payroll starting October 1, 2014. For future planning purposes, the City contnbution rate is expected to increase by approximately 1 23% of payroll during each of the next two years due to the continued phase in of the assumption changes, assuming there are no gains or losses. It is important to keep in mind that under the asset smoothing method, gams and losses are recognized over five years. As of September 30, 2013, the market value of assets exceeded the actuarial value of assets by $2,207,512. Once all the gains and losses through September 30, 2013 are fully recognized in the actuarial asset values, the contribution rate will decrease by roughly 1.1% of payroll before any other changes are taken into account, unless there are offsetting losses. Another important factor to consider is the annual payment on the unfunded accrued liability (UAL). This payment is computed as a level percentage of covered payroll under the assumption that covered payroll will rise by 4.0% per year. According to Florida Administrative Code (Statute 112), this payroll growth assumption may not exceed the average actual payroll growth during the last ten years, which is currently GRS 4 3.62 %. The use of a 3.62% payroll growth assumption this year instead of 4.0% increased the city contribution rate by 0.75% of payroll. In a few years, the ten -year average payroll growth rate is expected to continue to decline due to flat or negative payroll increases in recent years This will put upward pressure on the city contribution rate Relationship to Market Value If Market Value had been the basis for the valuation, the City contribution rate would have been 36.63% for the fiscal year ending 2015 and the funded ratio would have been 61.4 %. Conclusion The remainder of this Report includes detailed actuarial valuation results, financial information, miscellaneous information and statistics, and a summary of plan provisions. GRS 5 CHAPTER REVENUE Increments in Chapter revenue over that received in 1998 must first be used to fund the cost of compliance with minimum benefits. Once minimums are met, any subsequent additional Chapter revenue must be used to provide extra benefits. As of the valuation date, all minimum Chapter requirements have been met. Actuarial Confirmation of the Use of State Chapter Money 1. Base Amount Previous Plan Year $ 465,087 2. Amount Received for Previous Plan Year 619,853 3. Benefit Improvements Made in Previous Plan Year 0 4. Excess Funds for Previous Plan Year (2) - (1) - (3) 154,766 5. Accumulated Excess at Beginning of Previous Year 14,717 6. Prior Excess Used in Previous Plan Year 127,554 7. Accumulated Excess as of Valuation Date (Available for Benefit Improvements) 41,929 1 8. Base Amount This Plan Year 465,087 GRS SECTION B VALUATION RESULTS GRS 6 PARTICIPANT DATA October 1, 2013 October 1, 2012 ACTIVE MEMBERS Number 141 146 Covered Annual Payroll $ 11,302,523 $ 11,789,237 Average Annual Payroll $ 80,160 $ 80,748 Average Age 37.8 37.4 Average Past Service 9.5 8.8 Average Age at Hire 28.3 28.6 RETIREES & BENEFICIARIES & DROP Number 101 97 Annual Benefits $ 4,704,070 $ 4,476,206 Average Annual Benefit $ 46,575 $ 46,146 Average Age 57.7 56.9 1 DISABILITY RETIREES Number 15 15 Annual Benefits $ 311,885 $ 311,885 Average Annual Benefit $ 20,792 $ 20,792 Average Age 63.0 62.0 TERMINATED VESTED MEMBERS Number 6 4 Annual Benefits $ 129,803 $ 103,095 Average Annual Benefit $ 21,634 $ 25,774 Average Age 37.3 40.3 GRS 7 ANNUAL REQUIRED CONTRIBUTION (ARC) A. Valuation Date October 1, 2013 October 1, 2013 October 1, 2012 * Current Assumptions Prior Assumptions (with 60% phase -in of (with 40% phase -in of New Mortality and New Mortality and Termination rates) Termination rates) B ARC to Be Paid During Fiscal Year Ending 9/30/2015 9/30/2015 9/30/2014 C Assumed Date of Employer Contnb. 10/1/2014 10/1/2014 10/1/2013 D. Annual Payment to Amortize Unfunded Actuarial Liability $ 2,583,189 $ 2,559,286 $ 2,428.878 E. Employer Normal Cost 2,132,984 2,018,705 2,114,509 F. ARC if Paid on the Valuation Date: D +E 4,716,173 4.577,991 4,543,387 G. ARC Adjusted for Frequency of Payments 4,716,173 4,577,991 4,543,387 H. ARC as % of Covered Payroll 41.73 % 40.50 % 38.54 % I Assumed Rate of Increase in Covered Payroll to Contnbution Year N/A % N/A % N/A % J. Covered Payroll for Contnbution Year 11,575,236 ** 11,575,236 ** 11,834,246 K. ARC for Contribution Year: H xJ 4,830,346 4,687,971 4,560,918 L. Estimate of State Revenue in Contnbution Year 465,087 465,087 465,087 M. Required Employer Contribution (REC) in Contribution Year 4,365,259 4,222,884 4,095,831 N. REC as % of Covered Payroll m Contnbution Year: M = J 37.71 % 36.48 % 34.61 % From September 20, 2013 Actuarial Impact Statement "Esttnutte provided by the City GRS 8 ACTUARIAL VALUE OF BENEFITS AND ASSETS A. Valuation Date October 1, 2013 October 1, 2013 October 1, 2012 * Current Assumptions Prior Assumptions (with 60% phase -in of (with 40% phase -in of New Mortality and New Mortality and Termination rates) Termination rates) B. Actuarial Present Value of All Projected Benefits for 1 Active Members a Service Retirement Benefits $ 57,644,897 $ 56,040,319 $ 55,962,324 b. Vesting Benefits 2,697,084 2,682,792 2,850,194 c. Disability Benefits 3,850,236 3,759,497 3,886,035 d Preretirement Death Benefits 948,166 1,062,887 1,125,559 e Retum of Member Contnbutions 43,588 49,012 62,996 f Total 65,183,971 63,594,507 63,887,108 2. Inactive Members a. Service Retirees & Beneficiaries 53,162,097 52,736,326 50,628,067 b Disability Retirees 2,648,527 2,609,548 2,678,085 c Terminated Vested Members 869,788 864,477 816,351 d Total 56,680,412 56,210,351 54,122,503 3. Total for All Members 121,864,383 119,804,858 118,009,611 C. Actuanal Accrued (Past Service) Liability per GASB No 25 95,951,447 95,520,902 91,924,429 D. Actuanal Value of Accumulated Plan Benefits per FASB No. 35 84,102,687 83,388,999 79,453,983 E Plan Assets 1 Market Value 58,900,850 58,900,850 53,006,321 2. Actuanal Value 56,693,338 56,693,338 52,594,653 F Unfunded Actuarial Accrued Liabihty C - E2 39,258,109 38,827,564 39,329,776 G Actuanal Present Value of Projected Covered Payroll 103,892,263 101,402,498 108,720,594 H. Actuarial Present Value of Projected Member Contributions 7,272,459 7,098.175 7,610,441 I Accumulated Contributions of Active Members 6,247,797 6,247,797 5,924,573 * From September 20, 2013 Actuarial Impact Statement GRS 9 ENTRY AGE NORMAL MEF HOD CALCULATION OF EMPLOYER NORMAL COS T A Valuation Date October 1, 2013 October 1, 2013 October 1, 2012 Current Assumptions Pnor Assumptions (with 60% phase-in of (with 40% phase -in of New Mortality and New Mortality and Termination rates) Termination rates) B Normal Cost for 1 Service Retirement Benefits $ 2,235,630 $ 2,101,145 $ 2,186,969 2 Vesting Benefits 218,767 231,398 238,021 3 Disability Benefits 266,933 261,106 277,132 4. Preretirement Death Benefits 48,301 53,731 59,169 5 Return of Member Contributions 40,184 48,156 49,739 6 Total for Future Benefits 2,809,815 2,695,536 2,811,030 7 Assumed Amount for Administrative Expenses 114,346 114,346 128,726 8 Total Normal Cost 2,924,161 2,809,882 2,939,756 C. Expected Member Contribution 791,177 791,177 825,247 D Employer Normal Cost B8 -C 2,132,984 2,018,705 2,114,509 E Employer Normal Cost as a % of Covered Payroll 18.87% 17 86% 17.94% From September 20, 2013 Actuarial Impact Statement GRS 10 LIQUIDATION OF THE UNFUNDED ACTUARIAL ACCRUED LIABILITY A. UAAL Amortization Period and Payments Original UAAL Curre nt UAAL Amortization Date Period Years Established (Years) Amount Remaining Amount Payment 10/1/98 30 $ 1,331,353 15 $ 1,454,793 $ 125,705 10/1/99 30 1,656,722 16 1,825,561 150,506 10 /1 /00 30 185,619 17 204,187 16,123 10/1/01 30 46,601 18 51,799 3,930 10/1/04 30 1,166,935 21 1,322,786 90,555 10/1/05 30 2,985,574 22 3,382,135 224,762 10/1/05 30 13,646,165 22 15,458,720 1,027,319 10/1/06 30 2,307,394 23 2,608,096 168,581 10/1/07 30 16,404 24 18,409 1,159 10/1/08 30 3,582,504 25 3,964,026 243,651 10/1/09 30 3,419,100 26 3,724,715 223,765 10 /1 /10 30 1,404,570 27 1504,308 88,449 10 /1 /11 30 4,476,765 28 4,692,121 270,349 10/1/11 30 1,634,520 28 1,713,148 98,708 10/1/12 30 (2,249,576) 29 (2,288,188) (129,345) 10/1/12 30 412,194 29 419,269 23,700 10/1/12 30 (426,604) 29 (433,927) (24,529) 10/1/13 30 (794,394) 30 (794,394) (44,102) 10/1/13 30 430,545 30 430,545 23,903 $ 35232,391 $ 39,258,109 $ 2,583,189 B. Amortization Schedule The UAAL is being amortized as a level percent of payroll over the number of years remaining in the amortization period. The expected amortization schedule is as follows: Amortization Schedule Year Expected UAAL 2013 $ 39,258,109 2014 39,517,247 2015 39,695,689 2016 39,783,554 2017 39,770,044 2018 39,643,384 2023 36,821,944 2028 28,685,203 2033 14,960,633 2038 2,134,671 2041 - GRS 11 ACTUARIAL GAINS AND LOSSES The assumptions used to anticipate mortality, employment turnover, investment income, expenses, salary increases, and other factors have been based on long range trends and expectations. Actual expenence can vary from these expectations The variance is measured by the gain and loss for the period involved. If significant long term experience reveals consistent deviation from what has been expected and that deviation is expected to continue, the assumptions should be modified. The net actuarial gain (loss) for the past year is computed as follows. A. Derivation of the Current UAAL 1. Last Year's UAAL $ 39,329,776 2. Last Year's Employer Normal Cost 2,114,509 3, Last Year's Contributions 4,701,572 4 Interest at the Assumed Rate on: a. 1 and 2 for one year 3,211,932 b. 3 from dates paid 332,687 c. a - b 2,879,245 5. This Year's Expected UAAL: 1 + 2 - 3 + 4c 39,621,958 6 This Year's Actual UAAL (Before any changes in benefits and assumptions) 38,827,564 7. Net Actuarial Gain (Loss): (5) - (6) 794,394 8 Gain (Loss) due to investments (465,918) 9. Gain (Loss) due to other sources 1,260,312 *From September 20, 2013 Actuarial Impact Statement Net actuarial gains in previous years are detailed in the table on the next page. GRS 12 Change in Employer Year Ended Cost Rate * Gain (Loss) 12/31/82 0.46 % $ (56,551) 12/31/83 1 92 (265,213) 12/31/84 (0 04) 6,977 12/31/85 (0 85) 185,443 12/31/86 (0 59) 158,678 12/31 /87 1 67 (516,444) 12/31/88 0 74 (254,892) 12/31/89 (0.52) 206,590 9/30/90 0 24 (94,609) 9/30/91 (0 74) 286,744 9/30/92 0 35 (142,237) 9/30/93 (1.34) 564,365 9/30/94 2.57 (1,370,604) 9/30/95 (1 01) 574,379 9/30/96 (1.56) 938,153 9/30/97 (1 60) 1,008,362 9/30/98 (2 85) 1,694,077 9/30/99 (0 88) 568,386 9/30/00 (3 16) 1,596,887 9/30/01 3.92 (1,978,307) 9/30/02 9.58 (5,069,210) 9/30/03 3.22 (1,870,014) 9/30/04 2.75 (1,615,637) 9/30/05 1.85 (1,083,369) 9/30/06 1 46 (2,307,394) 9/30/07 0.02 (16,404) 9/30/08 1.84 (3,582,504) 9/30/09 1.54 (3,419,100) 9/30/10 0.66 (1,404, 570) 9/30/11 1.98 (4,476,765) 9/30/12 (1.01) 2,249,576 9/30/13 (0.38) 794,394 * Before 9/30/06, change in Employer Normal Cost. GRS 13 Actuarial Gain ( +) or Loss ( -) $10 $10 $5 � $5 ($5) ($ 0 0 ($10) ($10) ($15) ($15) (90) ($20) ( $25) _ - - - - - ($25) Plan Year End MIIM Gam or Loss -4-- Cumulative GRS 14 Change in Employer Cost Rate 24 %n - 24% 22% 22% 20% 20% 18 %_ 18% 16% _ 16% 14% = 14% 12% - 12% 10 % = 10% 8% _ 8% 6% - 6% 4% = 4% 2% 0% I ■ I l i we l 0% -2% -4 % -4% -6% = -6% -8% ti� � ) y �� `y b �� , `y \ � `y ��l� f f ; � � f) �4, �� °'��\ fl el el �� el el °' \p °�� s5 el el q 4\ 4 °1 \~ el el et ~ � el Plan Year End Change in Employer Cos t Rate -- Cumulative Change The fund earmngs and salary increase assumptions have considerable impact on the cost of the Plan so it is important that they are in line with the actual experience. The following table shows the actual fund earnings and salary increase rates compared to the assumed rates for the last few years: GRS 15 Investment Return Salary Increases Year Ending Actual I Assumed Actual I Assumed 12/31/1977 7.5 % 7.00 % 12/31/1978 7 1 7.00 18 3 % 10 3% (2 yrs) 12/31/1979 7 5 7.00 12/31/1980 8 0 7 00 21 2 10 3 (2 yrs) 12/31/1981 8 2 7 00 23.6 7 0 12/31/1982 9 3 7 00 14.6 7 0 12/31/1983 9 0 7 00 14.8 7.0 12/31/1984 115 1000 68 100 12/31/1985 16.8 10.00 18.6 10 0 12/31/1986 17 6 10 00 16 3 10 0 12/31/1987 4 4 10.00 15 3 10 0 12/31/1988 9 0 10.00 6 7 10 0 12/31/1989 15.4 10 00 12.4 10.0 9/30/1990 (9 mos ) 1.7 7 50 6 1 10 0 9/30/1991 11.6 10 00 2 5 10 0 9/30/1992 9.7 10.00 5 4 10.0 9/30/1993 11 9 10 00 3.1 10 0 9/30/1994 3 5 8.00 7 0 6 3 9/30/1995 12.9 8 00 8 5 5 8 9/30/1996 10 8 8.00 4.9 6.3 9/30/1997 13.1 8.00 8.7 x 6.3 9/30/1998 12.9 8.00 4 6 6 3 9/30/1999 13 5 8.50 10.9 6 1 9/30/2000 12 1 8 50 3.4 6.3 9/30/2001 7.5 8.50 6.0 5 9 9/30/2002 (4.7) 8 50 17 2 5 9 9/30/2003 2 8 8.50 9 5 5 9 9/30/2004 2 6 8.50 11.5 6.0 9/30/2005 3 0 8 50 9.6 6.0 9/30/2006 5 7 8 00 14 4 6 0 9/30/2007 9.9 8.00 5.7 61 9/30/2008 4.2 8.00 13 1 6 1 9/30/2009 2.8 8.00 9.3 61 9/30/2010 3 0 8.00 0 2 6 1 9/30/2011 1 6 8.00 7 3 5 8 9/30/2012 6 9 7.75 (3 1) 5 9 9/30/2013 7 0 7 75 0 1 5 8 Averages 7.9 % - -- 8.9 % The actual investment return rates shown above are based on the actuarial value of assets. The actual salary increase rate_ shown above are the increases received by those active members who were included in the actuarial valuations both at tht beginning and the end of each year GRS 16 History ofInvestment Return Based on Actuarial Value of Assets 18 % - 18% 13% - - 13% v vow 8% 3% = - 3% 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 -2% = - -2% -7% = = -7% Plan Year End --- Actual —4— Assumed History of Salary Increases 25% - - 25% 20% - 20% 15% = 15% 10% - V A 4 - 10% 5% = P . V 5% 0% _ 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 11 0% -5% = Plan Year End Compared to Previous Year �-- Actual — Assumed GRS 17 Actual (A) Compared to Expected (E) Decrements Among Active Employees Number Added Service & Active During DROP Disability Terminations Members Year Year Retirement Retirement Death Vested Other Totals End of Ended A E A E A E A E A A A E Year 9/30/2002 14 17 1 1 0 0 0 0 1 15 16 8 119 9/30/2003 14 9 6 4 0 0 0 0 1 2 3 9 124 9/30/2004 8 23 14 0 0 0 0 0 2 7 9 9 109 9/30/2005 21 14 1 1 0 0 0 0 3 10 13 8 116 9/30/2006 25 10 3 2 0 0 0 0 1 6 7 9 131 9/30/2007 17 4 3 3 0 0 0 0 0 1 1 11 144 9/30/2008 14 9 2 1 0 0 0 0 0 7 7 12 149 9/30/2009 8 6 3 7 0 0 0 0 0 3 3 11 151 9/30/2010 5 8 4 2 0 0 0 0 1 3 4 11 148 9/30/2011 5 9 5 4 0 0 0 0 2 2 4 10 144 9/30/2012 9 7 3 1 0 0 0 0 2 2 4 4 146 9/30/2013 5 10 3 1 0 0 0 0 4 3 7 7 141 9/30/2014 1 0 0 6 12 Yr Totals x 145 126 48 27 0 0 0 0 17 61 78 109 * Totals are through current Plan Year only GRS 18 SUPPLEMENTAL PENSION DISTRIBUTION Cumulative Actuarial Gains (Losses) Balance at 1 Year Ending B e ginning Gain (Loss) Supplemental Balance at 9/30 of Year Interest for Year Payment End of Year 2000 $ 0 $ 0 $ 1,596,887 $ 0 $ 1,596,887 2001 1,596,887 135,735 (1,978,307) 0 (245,685) 2002 (245,685) (20,883) (5,069,210) 0 (5,335,778) 2003 (5,335,778) (453,541) (1,870,014) 0 (7,659,333) 2004 (7,659,333) (651,043) (1,615,637) 0 (9,926,013) 2005 (9,926,013) (843,711) (1,083,369) 0 (11,853,093) 2006 (11,853,093) (948,247) (2,307,394) 0 (15,108,735) 2007 (15,108,735) (1,208,699) (16,404) 0 (16,333,838) 2008 (16,333,838) (1,306,707) (3,582,504) 0 (21,223,049) l 2009 (21,223,049) (1,697,844) (3,419,100) 0 (26,339,992) 2010 (26,339,992) (2,107,199) (1,404,570) 0 (29,851,762) 2011 (29,851,762) (2,388,141) (4,476,765) 0 (36,716,668) 2012 (36,716,668) (2,845,542) 2,249,576 0 (37,312,634) 2013 (37,312,634) (2,891,729) 794,394 0 (39,409,969) Under certain conditions, participants in payment status can receive a supplemental distribution per Section 18 -177 of the Plan. The cumulative actuarial gain for plan years beginning after 9/30/1999 must be a positive amount for a supplemental payment to occur GRS 19 RECENT HISTORY OF VALUATION RESULTS Number of Employer Normal Cost Valuation Active Inactive Covered Annual Actuarial Value % of Date Members Members Payroll of Assets UFAAL Amount Payroll 1/1/77 67 1 $ 903,341 $ 514,988 $ 0 $ 37,806 4 19 To 1/1/79 60 1 935,532 716,227 341,936 48,362 517 1/1/81 67 2 1,166,537 1,022,373 679,836 80,753 692 1/1/82 71 4 1,542.723 1,235,501 678,314 162,821 10 55 1/1/83 75 4 1,768,419 1,606,141 195,234 11 04 1/1/84 76 6 2,000,834 1,992,244 75,269 237,577 1187 1/1/85 78 8 2,109,424 2,506,277 69,847 255,451 12.11 1/1/86 88 8 2,700,315 3,239,052 63,709 317,557 1176 1/1/87 97 10 3,306,137 4,191,766 55,706 363,436 1099 1/1/88 101 12 3,830,624 4,791,236 47,674 478,126 12 48 1/1/89 115 14 4,394,160 5,806,225 35,670 574,167 13.07 1/1/90 121 15 5,111,017 7,334,224 26,768 672,246 13.15 10/1/90 119 15 5,214,164 8,160,443 0 696,652 13 36 10 /1 /91 118 16 5,288,735 9,961,491 0 650,512 1230 10/1/92 121 19 5,627,956 11,619,301 0 676,120 12.01 10/1/93 124 25 5,493,434 13,670,651 0 670,021 12 20 10/1/94 114 29 5,430,866 14,629,045 0 817,743 15 06 10/1/95 121 30 5,957,175 16,967,617 0 841,330 14 12 10/1/96 127 34 6,298,250 19,439,074 0 820,603 13.03 10/1/97 130 47 6,329,651 22,898,830 0 811,606 12 82 10/1/98 121 48 6,225,413 25,462,061 1,331,353 715,944 11.50 10/1/99 128 49 7,121,387 28,956,651 1,358,222 762,124 1070 10/1/00 124 56 6,907,740 32,559,614 3,279,968 464,164 6.72 10/1/01 122 75 6,555,316 34,331,760 3,358,086 726,204 11 08 10/1/02 119 75 7,382,088 32,133,373 3,371,705 1,538,895 2085 10/1/03 124 81 7,917.021 33,206,438 3,374,199 1,935,704 2445 10/1/04 109 94 7,207,008 34,495,794 4,580,926 2,043,434 28 35 I0 /1 /05 116 96 7,836,390 35,445,474 21,245,873 1,238,339 15.80 10/1/06 131 100 9,302,405 37,691,909 23,776,358 1,441,317 1549 10/1/07 144 103 10,296,812 41,981,125 24,087.631 1,587,552 15 42 10 /1/08 149 104 11,532,888 44,277,726 28,071,917 1,774,031 15 38 10 /1/09 151 107 12,537,968 46,116,985 31,938,418 1,931,395 15.40 10 /1 /10 148 109 12,134,525 48,129,593 33,827,611 1,895,893 15.62 10 /1 /11 144 113 12,397,266 49,1 15,728 40,540,684 2,126,920 17.16 10/1/12 146 116 11,789,237 52,594,653 39,329,776 Y 2.114,509 17,94 10/1/13 141 122 11,302.523 56,693,338 39,258,109 2,132,984 18 87 *From September 20, 2013 Actuarial Impact Statement GRS 20 d• O M_ O\0 O N O 00 47 oo N M 0 c M av N oo - c m, v, N c3 o 00 N oo O v) M N N h N en O t� h Q i O� O ID N d• M V1 t- [ q „� do d• m do N O N oo N O M N oo O ., a1 N d r vi y 0� o v i —7 v i D1 vi N (` a, 45 0 a\ d' 0 M , M — M 1 " oo O ,.O O M r p ,O 00 ea. 0 M M ire O\ m 4D M 01 V) M N V) N d' V) V) d' 0 k M ---� tr) O N N M d• In s s t` t` t` 00 01 01 m 00 0\ N 0 CT o N ^ O — .- m N N 0 N M m M d d' d d O 2 d' N d' -, d' N 00 0 0\ 0\ 0 on d' 71 d' 1 en N d t N r t N r- t- N N N N c3 <1 11 8 00 a\ CO 0\ 00 d' M m N V) N M t- N d' t- V7 00 00 00 00 00 00 00 00 00 00 00 p al •t d O 0) N O N t` m .-, 0O oo ) ,, d• O 000 0 0 00000 O k6 ( \O t : d' op N 4 r 00 O GO G N : h Qy O M kri vi v) V) v, V":: l v v Vi Ili' V1 CA ,-+ -, e- N N N N N N M M d V� .4 7 4 4 4 7 4 4 4 4 4 7 ca y 69 U O oO CT Cr, N oo d pO Ln Cr, .O m M, t- 7t co 0\ kn o, d N O 7t N 4 O co 02 v; c3 cO c. oo M 47 co 0 0\ N 40. t N N ' N N 0 0 S N N 71- � O in co -, d �O m p C q dr r- N 00 vl d a 0 —, 4 , O N M v v� 0 oO 0o m oo 4 C p r 00 s 00 V) �--, o0 M t� M 0 1 M oO N -1 47 N O ‘.0 00 ‘.p m. Vl 7 v o0 N M ‘4:5 F- h N N M •--i d l� v) coO N cn N c\ ^- -. 00 t-- 0 d' co N d oo en M m �. r+ N N M v) v ) d• c, �t 0 er, 7 d' 7t M 47) d co --, m Z N N 47 ,O N A , - N (-4 N N m f m. M 4 69 a p p N m en M N dY N N O 4 D O N a\ N N m-I M m N N oo N oo 4O vi �r v) ^� N O d• O O v• sD N v) v) O g in M ^, N N g v'1 CT d• O oo O \0 h („y S a a; • D1 0o O • O • O • O • a oo O oo [� t` d• U O m D\ h oo o0 0o m d (` 0 N N (04\ N N N N N N m M M O a t —, v, v ,O d' 3 d' a, 4 oo t` v) oc N oo N O O d• N oi oo v`, — 0\ .+ ,,,, ■O oo N en oo h 00 d' M �O N ^ N g O N l� �O cn O o P. oo � oo M v) C it 4 O a N 47 7 t— N N s O s ^ r" d' l— V , n O oO 7 O en O oo 7Y oo N z pp pp N M m oo m a �p O g N N o g oo �p aS ','g vi oo N m g v 0� D , N (V V) er, d' N O N N O '- N M a\ --+ 47 00 CO O d' t-- d' 03 m, M m 0\ lO F --� N N M V, in - V) d' �D e.0 v) d' d' d' M �D 71: CO e-+ M V) l� N ‘.O v', ‹.) N O M U N N CV N M M M M d d 71 .el 64 A v) '6' e <1 t` m cn h oo N N m N N tt N N t N v) M N , O U m M N ; �; p V) • 0\ V1 0 ,--, d' M ‘.0 N V) 00 01 m V) M 00 Q. N N 0 00 d' 0\ 0 M -- V) 0 r r-- 4O s•C o\ O R M,, 4 4 4 4 4 4 d' 4 4 v"1 z �D �O z vi vi d d M M m m, M 4 I wo a a o tt • U2 N d' -° d' N oo O 0 a oo M d• d d' g '4;‘, rt �t 0 % t'0- `co 0 % t- 0 % N N N 0 % �' 00 D\ 03 a, 0 d' m M N 00 t-- t` M ' t` oo g v) cn 00 00 00 00 00 00 00 00 00 00 00 00 N d -0 O a V O a d t O O h m^ o0 0o a d 0 0 0 0 0 0 0 0 0 0 0 0 W L X p Ch ‘.0 O\ ‘.0 h V) d' Q N d r O 47 oo m t l� m, m, vi v1 v i vi cn vi vi v; v i U, v; v1 a W N ON O h N N v) V N l� d' O c-1-- N N ,O ,O ,O 4 ,O ,D �O ,D ,O ,O 4D 4O 7 --, ^+ ,a'`, N N N N N N M M 7 d• d' d• �t d ,r 4? 7 d �t d d' 7 7 d• O a O C l� GO DD 00 l- l- M d N N 1 N C GO N V') aO O [^ V7 00 M l� M 00 V7 00 d M O o 6 rt d• N oo d - v) co v, d- v) l - co 00 0\ N O 40 �O oo cn d• ^ --� r v) , •0 v) N .M -i M M M 4 7 V) r', m M \O 7 M c N O'0 .0 a N V) N— N M— N'0 0O ,--, Q pl —, -. —, ^ ^ ^ �--, ^' ^ ^ ^ ^' ^ ^ -N N M M M M M M M M m, M, d E 4 �,yy - y 4. 0 p d' M g '0 0 'O co ¢ CO , 0 \D 0 0∎ N 'O N '0 M o0 O, N N 01 m M In N 0 '0 L. co N a, t- © cn `O M 0 N h N o0 O∎ Vn a\ N d' 'O v) 0 0 Vt 17 d• 'D 0 N �n N d. .m., , C a d. vO oo 0y M '0 v) -, N O N co N 0y N m4 7 47 •-. 0y v) N -e v0 -� 0■ v' 0) M W A 0 O - o o M v) ^- vl N d N ( C . v) 00 0; M O (-xi •-' a■ c —I oo O ‹) 6 M (--- 06 pp C:,-5: J G ' O 0 0 '0 0 M M d' co M ' M a1 N 00 N '0 N v; N d' N 0 M M V) Ch 0\ 0 ' ✓ Q N N M d• v) 4) N N r r 00 g co 00 co 0v N 0 Cr,„ M v) oo 0 N t` --e 0v 0 r- v; 00 W — ^ N N N m r m d' «i d' 4 rY d= a 4 b .L 4"0 H 4 O c 2203 N m d' vl ,O oo 0v N M en 4p t` 0o O ^-, N_ 3 m 71 v) Q U :: -_ -_ , O) a, 0 a\ a) a\ G1 Q\ Cr, O O O O 0 0 0 0 0 O A l rr ;" O O O O O O O O O O O O O O O O O O O O O O O 7. O O � O M M M M M M M M M M M M m m M M M M m, M M M M M, m, M M M M M d C> _ N ._ N N N -- Cr -- -- a, 0, cr g CT 01 -- cr cr cr N > � ^, _ .� ^, a\ � c� rn a\ a, Cr a\ a\ a` a, 0, a` � � a\ CT a, a a, o, a\ o\ rn a` N N i y 0 ' ,;,{ d' V) (\ 00 0., 0, N M a . * t� 20 Q` 3, m V) t— 00 O N M y 23 co 00 00 00 00 O rn a` a1 4, a\ a\ a, Q\ a` O O O O O O O O O 0 O y ,—, O O O O O O O O 0 0 0 0 0 O O O O O 0 0 0 0 0 O O z GRS 21 ACTUARIAL ASSUMPTIONS AND COST METHOD Valuation Methods Actuarial Cost Method - Normal cost and the allocation of benefit values between service rendered before and after the valuation date were determined using an Individual Entry -Age Actuarial Cost Method having the following characteristics: (i) the annual normal cost for each individual active member, payable from the date of employment to the date of retirement, is sufficient to accumulate the value of the member's benefit at the time of retirement; (n) each annual normal cost is a constant percentage of the member's year by year projected covered pay Actuarial gains /(losses), as they occur, reduce (increase) the Unfunded Actuarial Accrued Liability. Financing of Unfunded Actuarial Accrued Liabilities - Unfunded Actuarial Accrued Liabilities (full funding credit if assets exceed liabilities) were amortized by level (principal & interest combined) percent -of- payroll contributions over a reasonable period of future years. Actuarial Value of Assets - The Actuarial Value of Assets phase in the difference between the expected actuarial value and actual market value of assets at the rate of 20% per year. The Actuarial Value of Assets will be further adjusted to the extent necessary to fall within the corridor whose lower limit is 80% of the Market Value of plan assets and whose upper limit is 120% of the Market Value of plan assets. During periods when investment performance exceeds the assumed rate, Actuarial Value of Assets will tend to be less than Market Value. During periods when investment performance is less than assumed rate, Actuarial Value of Assets will tend to be greater than Market Value. Valuation Assumptions The actuarial assumptions used in the valuation are shown in this Section. Economic Assumptions The investment return rate assumed in the valuation is 7.75% per year, compounded annually (net after investment expenses). The Wage Inflation Rate assumed in this valuation was 4% per year. The Wage Inflation Rate is defined to be the portion of total pay increases for an individual that are due to macro economic forces including productivity, price inflation, and labor market conditions. The wage inflation rate does not include pay changes related to individual merit and seniority effects. The assumed real rate of return over wage inflation is defined to be the portion of total investment return that is more than the assumed wage inflation rate. Considering other economic assumptions, the 7 75% investment return rate translates to an assumed real rate of return over wage inflation of 3.75%. GRS 22 The rates of salary increase are as follows: % Increase in Salary Age Merit and Base Total Seniority (Economic) Incre as e 20 2.5% 4.0% 6.5% 25 2.5% 4.0% 6.5% 30 2.5% 4.0% 6.5% 35 2.5% 4.0% 6.5% 40 1.5% 4 0% 5.5% 45 1.0% 4.0% 5.0% 50 1.0% 4.0% 5.0% 55 1.0% 4.0% 5.0% Projected service retirement benefits are increased to allow for the inclusion of unused sick and vacation pay in average final earnings. The increase amount is unique for each member based on the number of hours of accumulated sick and vacation time reported for each member as of June 18, 2013. For purposes of financing the unfunded liabilities, total payroll is assumed to grow at 4% per year, but not exceeding the average annual increase over the most recent ten years. The most recent ten -year average is 3.62 %. Demographic Assumptions The mortality table was the RP -2000 Combined Healthy Participant Mortality Tables for males and females reflecting future improvements in mortality using Scale AA. These rates are being phased in from the table used in the previous report (1983 Group Annuity Mortality table - rates shown below) over a five year period, beginning October 1, 2011. As of October 1, 2013, 60% of the rates below are being applied along with 40% of the rates on the top of the next page. RP -2000 Combined Healthy Participant Mortality Sample Probability of Future Life Attained Dying Next Year Expectancy (years) Ages (in 2013) Men Women Men Women 50 0.17 % 0.13 % 34.17 35.58 55 0.28 0 24 29.05 30.61 60 0.55 0.47 24.13 25.84 65 1.06 0.91 19.53 21.35 70 1.82 1.57 15.35 17.24 75 3.15 2.53 11.58 13.52 80 5.65 4.19 8.38 10.22 GRS 23 1983 GAM - Prior Mortality Table (Being Phased Out) Sample Probability of Future Life Attained Dying Next Year Expectancy (years) Ages Men Women Men Women 50 0.39 % 0.16 % 29.23 34.96 55 0.61 0.25 24.87 30.28 60 0.92 0.42 20.68 25.71 65 1.56 0.71 16.73 21.33 70 2.75 1.24 13.22 17.17 75 4.46 2.40 10.20 13.42 80 7.41 4.30 7.68 10.24 This assumption is used to measure the probabilities of each benefit payment being made after retirement. For active members, the probabilities of dying before retirement were based upon the same mortality table as members dying after retirement (75% of deaths are assumed to be service - connected). For disabled retirees, the regular mortality tables are set forward 5 years in ages to reflect impaired longevity. The rates of retirement used to measure the probability of eligible members retiring under early retirement is 5% per year. For normal retirement these rates are as follows: Number of Ye ars Afte r Firs t Eligibility Probability of for Normal Retire ment Normal Retire ment 0 40 % 1 10 % 2 10 % 3 10 % 4 10 % 5 10 % 6 10 % 7 100 % GRS 24 Rates of separation from active membership were as shown below (rates do not apply to members eligible to retire and do not include separation on account of death or disability). These rates are being phased in from the table used in the previous report (rates shown below) over a five year period. This assumption measures the probabilities of members remaining in employment. As of October 1, 2013, 60% of these rates are being applied along with 40% of the prior rates (being phased out). Years Sample % of Active Members of Service Ages Separating Within Next Year 0 - 1 ALL 15.0% 1 - 2 10.0% 2 -3 7.0% 3 -4 5.0% 4 -5 4.0% At least 5 25 4.0% 30 3.0% 35 2.0% 40 1.0% 45 0.0% Prior Rates (Being Phased Out) Sample % of Active Members Ages Separating Within Next Year 20 20.0% 25 17.0% 30 13.2% 35 8.0% 40 0.0% 45 0.0% 50 0.0% 55 0.0% Rates of disability among active members (90% of disabilities are assumed to be service connected). Sample % Becoming Disabled Ages within Next Year 20 0.14 25 0.15 % 30 0.18% 35 0.23 40 0.30 45 0.51 % 50 1.00 % 55 1.55 GRS 25 Miscellaneous and Technical Assumptions Administrative & The investment return assumption is intended to be the return net of Investment Expenses investment expenses. Annual administrative expenses are assumed to be equal to the average of the prior two years' expenses. Assumed administrative expenses are added to the Normal Cost. Benefit Service Exact fractional service is used to determine the amount of benefit payable. Decrement Operation Disability and mortality decrements operate during retirement eligibility. Decrement Timing Decrements of all types are assumed to occur at the beginning of the year. Eligibility Testing Eligibility for benefits is determined based upon the age nearest birthday and service nearest whole year on the date the decrement is assumed to occur. Forfeitures For vested separations from service, it is assumed that 0% of members separating will withdraw their contributions and forfeit an employer financed benefit. It was further assumed that the liability at termination is the greater of the vested deferred benefit (if any) or the member's accumulated contributions. Incidence of Employer contributions are assumed to be made at the beginning of the year Contributions effective October 1, 2011. Member contributions are assumed to be received continuously throughout the year based upon the computed percent of payroll shown in this report, and the actual payroll payable at the time contributions are made. Liability Load Projected normal and early retirement benefits are loaded by a unique amount for each member to allow for the inclusion of unused sick and vacation pay in final average earnings. These individual loads are based on the number of hours of unused accumulated sick and vacation time reported for each member as of June 18, 2013. Marriage Assumption 100% of males and 100% of females are assumed to be married for purposes of death -in- service benefits. Male spouses are assumed to be three years older than female spouses for active member valuation purposes. Normal Form of Benefit A 10 -year certain and life annuity is the normal form of benefit. Pay Increase Timing Middle of fiscal year. This is equivalent to assuming that reported pays represent amounts paid to members during the year ended on the valuation date. GRS 26 GLOSSARY Actuarial Accrued Liability The difference between the Actuarial Present Value of Future Benefits, (AAL) and the Actuarial Present Value of Future Normal Costs. Actuarial Assumptions Assumptions about future plan experience that affect costs or liabilities, such as: mortality, withdrawal, disablement. and retirement; future increases in salary; future rates of investment earnings; future investment and administrative expenses; characteristics of members not specified in the data, such as marital status; characteristics of future members; future elections made by members; and other items. Actuarial Cost Method A procedure for allocating the Actuarial Present Value of Future Benefits between the Actuarial Present Value of Future Normal Costs and the Actuarial Accrued Liability. Actuarial Equivalent Of equal Actuarial Present Value, determined as of a given date and based on a given set of Actuarial Assumptions. Actuarial Present Value The amount of funds required to provide a payment or series of payments (APV) in the future. It is determined by discounting the future payments with an assumed interest rate and with the assumed probability each payment will be made. Actuarial Present Value of The Actuarial Present Value of amounts which are expected to be paid at Future Benefits (APVFB) various future times to active members, retired members, beneficiaries receiving benefits, and inactive, nonretired members entitled to either a refund or a future retirement benefit. Expressed another way, it is the value that would have to be invested on the valuation date so that the amount invested plus investment earnings would provide sufficient assets to pay all projected benefits and expenses when due. Actuarial Valuation The determination, as of a valuation date, of the Normal Cost, Actuarial Accrued Liability, Actuarial Value of Assets, and related Actuarial Present Values for a plan. An Actuarial Valuation for a governmental retirement system typically also includes calculations of items needed for compliance with GASB No. 25, such as the Funded Ratio and the Annual Required Contribution (ARC). Actuarial Value of Assets The value of the assets as of a given date, used by the actuary for valuation purposes. This may be the market or fair value of plan assets or a smoothed value in order to reduce the year -to -year volatility of calculated results, such as the funded ratio and the actuarially required contribution (ARC). Amortization Method A method for determining the Amortization Payment. The most common methods used are level dollar and level percentage of payroll. Under the Level Dollar method, the Amortization Payment is one of a stream of payments, all equal, whose Actuarial Present Value is equal to the UAAL. Under the Level Percentage of Pay method, the Amortization Payment is GRS 27 one of a stream of increasing payments, whose Actuarial Present Value is equal to the UAAL. Under the Level Percentage of Pay method, the stream of payments increases at the rate at which total covered payroll of all active members is assumed to increase. Amortization Payment That portion of the plan contribution or ARC which is designed to pay interest on and to amortize the Unfunded Actuarial Accrued Liability. Amortization Period The period used in calculatmg the Amortization Payment. Annual Required The employer's periodic required contributions, expressed as a dollar Contribution (ARC) amount or a percentage of covered plan compensation, determined under GASB No. 25. The ARC consists of the Employer Normal Cost and Amortization Payment. Closed Amortization Period A specific number of years that is reduced by one each year, and declines to zero with the passage of time. For example if the amortization period is initially set at 30 years, it is 29 years at the end of one year, 28 years at the end of two years, etc. Employer Normal Cost The portion of the Normal Cost to be paid by the employer. This is equal to the Normal Cost less expected member contributions. Equivalent Single For plans that do not establish separate amortization bases (separate Amortization Period components of the UAAL), this is the same as the Amortization Period. For plans that do establish separate amortization bases, this is the period over which the UAAL would be amortized if all amortization bases were combined upon the current UAAL payment. Experience Gain/Loss A measure of the difference between actual experience and that expected based upon a set of Actuarial Assumptions, during the period between two actuarial valuations. To the extent that actual experience differs from that assumed, Unfunded Actuarial Accrued Liabilities emerge which may be larger or smaller than projected. Gains are due to favorable experience, e.g., the assets earn more than projected, salaries do not increase as fast as assumed, members retire later than assumed, etc. Favorable experience means actual results produce actuarial habilrties not as large as projected by the actuarial assumptions. On the other hand, losses are the result of unfavorable experience, i.e., actual results that produce Unfunded Actuarial Accrued Liabilities which are larger than projected. Funded Ratio The ratio of the Actuarial Value of Assets to the Actuarial Accrued Liability. GASB Governmental Accounting Standards Board. GASB No. 25 and These are the governmental accounting standards that set the accounting GASB No. 27 rules for public retirement systems and the employers that sponsor or contribute to them. Statement No. 27 sets the accounting rules for the employers that sponsor or contribute to public retirement systems, while Statement No. 25 sets the rules for the systems themselves. GRS 28 Normal Cost The annual cost assigned, under the Actuarial Cost Method, to the current plan year. Open Amortization Period An open amortization period is one which is used to determine the Amortization Payment but which does not change over time. In other words, if the initial period is set as 30 years, the same 30 -year period is used in determining the Amortization Penod each year. In theory, if an Open Amortization Period is used to amortize the Unfunded Actuanal Accrued Liability, the UAAL will never completely disappear, but will become smaller each year, either as a dollar amount or in relation to covered payroll. Unfunded Actuarial Accrued The difference between the Actuarial Accrued Liability and Actuarial Liability Value of Assets. Valuation Date The date as of which the Actuarial Present Value of Future Benefits are determined. The benefits expected to be paid in the future are discounted to this date. GRS SECTION C PENSION FUND INFORMATION GRS 29 SUMMARY OF ASSETS September 30 Item 2013 2012 A. Cash and Cash Equivalents (Operating Cash) $ 25,894 $ 10,319 B. Receivables: 1. Member Contributions $ - $ - 2. Employer Contributions - - 3 State Contributions - - 4. Buy -Backs 53,824 43,529 5. Receivable for Securities Sold 354,781 313,216 6. DROP Loans 173,596 115,706 7. Total Receivables $ 582,201 $ 472,451 C. Investments 1. Short -Term Investments $ - $ 5,875 2. Domestic Equities (Large cap defensive) 17,672,434 - 3. Real Estate 3,042,335 2,711,711 4. Multi -Asset Core Fund (Equities) 27,141,597 40,015,863 5. Multi- Manager Bond Fund (Fixed Income) 20,759,282 18,375,166 6. Total Investments $ 68,615,648 $ 61,108,615 D. Liabihties and Reserves 1. Benefits Payable $ - $ - 2. Accrued Expenses and Other Payables (141,953) (119,246) 3. Total Liabilities and Reserves $ (141,953) $ (119,246) E. Total Market Value of Assets Available for Benefits $ 69,081,790 $ 61,472,139 F. Reserves 1. State Contribution Reserve $ (41,929) $ (14,717) 2. DROP Accounts (8,058,513) (6,611,126) 3. Supplemental Benefit Reserve (2,080,498) (1,839,975) $ (10,180,940) $ (8,465,818) G. Market Value Net of Reserves $ 58,900,850 $ 53,006,321 H. Allocation of Investments 1. Short -Term Investments 0.00% 0.01% 2. Domestic Equities (Large cap defensive) 25.76% 0.00% 3. Real Estate 4.43% 4.44% 4. Multi -Asset Core Fund (Equities) 39.56% 65 48% 5 Multi- Manager Bond Fund (Fixed Income) 30.25% 30.07% 6. Total Investments 100.00% 100.00% GRS 30 PENSION FUND DISBURSEMENTS & INCOME September 30 Item 2013 2012 A. Market Value of Assets at Beginning of Year $ 61,472,139 $ 51,431,975 B. Revenues and Expenditures 1. Contributions a Employee Contributions $ 902,696 $ 928,983 b Employee Contributions (Back Pay Settlement) - - c. Employer Contributions 4,236,485 3,633,868 d State Contributions 619,853 595,919 e. Buy Back Contributions 88,220 15,440 f. Health Subsidy Contributions - - g DROP Rollover 126,821 135,291 h Increase in Value of Future Buy Backs 10,295 4,561 1. Total $ 5,984,370 $ 5,314,062 2. Investment Income a. Interest, Dividends, and Other Income $ 6,543 $ 9,090 b. Net Realized Gains /(Losses) 3,476.520 7,521,202 c Net Unrealized Gain/(Losses) 3,155,801 2,139,178 d Investment Expenses (519,021) (364,647) e Net Investment Income $ 6,119,843 $ 9,304,823 3. Benefits and Refunds a. Refunds $ (67,665) $ (53,277) b. Regular Monthly Benefits (3,931,713) (3,742,937) c. DROP Distributions (389,249) (659,751) d. Total $ (4,388,627) $ (4,455,965) 4 Administrative and Miscellaneous Expenses $ (105,935) $ (122,756) 5. Transfers $ - $ - C Market Value of Assets at End of Year $ 69,081,790 $ 61,472,139 D. Reserves 1. Supplemental Benefit Reserve $ (2,080,498) $ (1,839,975) 2. State Contribution Reserve (41,929) (14,717) 3. DROP Accounts (8,058,513) (6,611,126) 4 Total Reserves $ (10,180,940) $ (8,465,818) E. Market Value Net of Reserves $ 58,900,850 $ 53,006,321 GRS 31 00 888 Z N r O O O ., N N 0 N EA 6 EA e e e S g g ,-r N 0\ N O -. N ~ E S g � � o0 o c r WI s0 00 •Ct. 8 j O O O N .-i N 0■ 01 M O O N N O r EA ER ) �° . . • v - ) -, o .o , r 1 I 1 1 1 1 1 I e e g °. 00 o0cl O 888 a? 00 4 00 0 0 o a 1 N aN 0 t0 0 N op H W b E� ER E Ci) Q 0" 00 cn e .o , -. rn .O - , 00 00 00 N 00 0, M o 00 N e e e ' t� M O N 00 c r - O1 M — N M lt" N ,--, 41 ° 0 0 1.) ;To r---, -. 00 00 l 0 c> c:;,, 00 O N O, 0), N N 61, v') '71 c� v1 O >> O O r-. c•i CT 0", 0 0k v') 0 N v ; v1 v , d 06 v) 't , --- , 0o O m t- r a M ko 0o t~ 00 --+ 00 N 00 d' 00 ( 0, - 0\ .O l- d v7 00 Q W O O , 1-, m N rn CT 00 t 00 00 C 00 O 0.. . o ry U ▪ N .D 0 ‘.0 '0 000 � N a) Ef3 6 ER ra C LC, m N .o - 0 : m 00 00 - N �, i n m o0 e e e - N M l� d' N vl •O v') N 01 M 01 M v ; N .p .-+ N .--, N N v1 .D 00 '0 M g �t ,-. o;, cn o0 t l O oo O N a1 O, 0o O d: v'? C ., d;, [� ,-, Ch.. .O .o 0o G� cr; U — N v ; O N v/ v1 v') k N O .p ['� p d ,-- Q\ c _ .O l� Q. N N m M oo V' oo 00 r- -. c, Cp.. .O h 0 M a\ .-. — t` cn D a 00 N v d [ O D C 'C' v, - I - c" V N ' 0 v- Q ; d' N .O � .O 4 ,-, s.. d cct 64 69 EA CO M 00 N 69 0) 0 ct 0) ? CC vi >-' 5, M 0 N 0 N > G L. 0A U V) " Q y y 0 a. ,.. y o t W y ., o o * Cq ti c-) y U .x' o' rri ro y ,. Q o a O w Q C y a> b U a � a.) p a� as c� w H wo N �s o d L W -.] G. U . o 1 0 cA Q o -o Q o O y> U o U `o o o o Q > CG co z ca a o o °? o C i ° ti. -,..° . U U - a c"a o A > > > y , 0 a ,, o a = ' o 'd C, a 7 .i a °' Q LE -C ' Dt i E U v) 4)? .cam o Cr, o a. 3 a a a o 0 71 U N m ,8 • • cv • cr .1.: .1.: v- .o N cr 7i u; [- 0p ` v R ›- Q � � Z S w : W W ; a u. w u. a. L.T. <1 0 C.7 CD CD 0 CD C C.7 G1 < I:4 a Q 4 U L W u.; U x ..; h GRS 32 RECONCILIATION OF DROP ACCOUNTS Value at beginning of year $ 6,611,126 Adjustment to beginning of year balances + 117,722 Payments credited to accounts + 1,151,166 Rollovers into DROP account + 126,821 Investment Earnings credited + 520,915 Withdrawals from accounts - 389,249 Loan Proceeds - 107,000 Loan Payments + 27,012 Value at end of year 8,058,513 GRS 33 INVESTMENT RATE OF RETURN Investment Rate of Return Year Ended Market Value Actuarial Value 12/31/82 16 4 % 9.3 % 12/31/83 12.3 9.0 12/31/84 11 9 11.5 12/31/85 23.0 16.8 12/31/86 19 0 17.6 12/31/87 0 3 4.4 12/31/88 10.4 9.0 12/31/89 20.6 15.4 9/30/90 (9 mos.) (1.9) 1.7 9/30/91 14 4 11.6 9/30/92 10.0 9.7 9/30/93 12.6 11.9 9/30/94 1 1 3.5 9/30/95 19.1 12.9 9/30/96 12.8 10 8 9/30/97 20.2 13.1 9/30/98 10.1 12.9 9/30/99 10.5 13.5 9/30/00 9.8 12.1 9/30/01 (9.1) 7.5 9/30/02 (9.2) (4.7) 9/30/03 16.1 2.8 9/30/04 8.3 2.6 9/30/05 10.6 3.0 9/30/06 6.9 5.7 9/30/07 13.1 9.9 9/30/08 (15.1) 4.2 9/30/09 (0.8) 2.8 9/30/10 10.2 3.0 9/30/11 (0.6) 1.6 9/30/12 18.0 6.9 9/30/13 9.8 7.0 Average Returns: Last Five Years 7 1 % 4.2 % Last Ten Years 5 6 % 4.6 % All Yeats 87 % 8.0 % GRS SECTION D FINANCIAL ACCOUNTING INFORMATION GRS 34 FASB NO. 35 INFORMATION A. Valuation Date October 1, 2013 October 1, 2012 B. Actuarial Present Value of Accumulated Plan Benefits 1. Vested Benefits a. Members Currently Receiving Payments $ 55,810,624 $ 53,306,152 b. Terminated Vested Members 869,788 816,351 c Other Members 26,853,954 24,599,042 d. Total 83,534,366 78,721,545 2. Non - Vested Benefits 568,321 732,438 3. Total Actuarial Present Value of Accumulated Plan Benefits: ld + 2 84,102,687 79,453,983 4. Accumulated Contributions of Active Members 6,247,797 5,924,573 C. Changes m the Actuarial Present Value of Accumulated Plan Benefits 1. Total Value at Beginning of Year 79,453,983 74,497,057 2. Increase (Decrease) During the Period Attributable to: a. Plan Amendment (287,739) 0 b. Change in Actuarial Assumptions 713,688 668,136 c. Latest Member Data, Benefits Accumulated and Decrease in the Discount Period 9,373,299 9,312,689 d. Benefits Paid (Net basis, including credits to DROP accounts) (5,150,544) (5,023,899) e. Net Increase 4,648,704 4,956,926 3. Total Value at End of Period 84,102,687 79,453,983 D. Market Value of Assets 58,900,850 53,006,321 E Actuarial Assumptions - See page entitled Actuarial Assumptions and Methods GRS 35 o v, ii "' U oo t- co O\ N O\ AD '1: D\ AD t- t- v1 --, \D 7r t- 00 O \D M Q CJ O \ vi t-: O\ , , t- \p co', oz ,--, \O -; rt \O O\ -i M M 'Ch 00 tz M t-: a O C4 N N N r N N ---� ---- v) - ^ M, i o0 r- v> co rt v7 r- N M ctt N N Cl N N N M M M • U 0. w O 6 c rt vo O , -- , M t- O \D 00 -� 00 p v) N 00 00 V7 t- c '7, co) M \D Cs-- vo - 00 `1" ■--■ 00 N Q O\ O ,-- 00 \O N \D M N CC r O N 00 ^ N vD -t M t 2, M O O O M 00 00 CT v7 N el, v) 0. 00 oo N� on v N N N O V 0 00 0 - O on O M M co C\ o O ▪ U 00 7 CT (. M (- ,--, ch n. M N 00 M Ci n r -- M r- M L vo vo vo vo O \ O \O t� \ p \G t- t- t- t� O\ O -- N N N ,-, C4 ,--i ,--, , -, ,--, ... - O C/] J {/4 cA O aA N in M - N 00 N co vn O - rt \O in m y N t- 00 N --i gg . t` oo a\ ,-, N cri 06 t` \D ,-, a1 vi -- (V --, co; - a\ oo rf t: a1 O . j . 00 00 00 00 00 Q 01 O\ O\ O\ N N O ton \O O O \� � v V v ) g N • o- 2- ., a OD \O M tD O Ct 00 AD M v) O 00 M 00 co , � ,� --I 00 l- 00 ,--I \D Oo 4. +,,,, '' O\ CD 00 O l' \D O \p 00 DD \D \p O - r, \D l- � 00 [- co V1 O M Cr'', v) Cr), -- Cl. Cl, t N., C N. m A OA d: AO D r".... \D 00 O C , - 0 t t "1 O N 00 V") \D r- -� 00 t� O C\ 0 Ogg 10 \D v) ,� v7 N d' ,-. t \D 00 t N vn l 00 N M N rf N v7 W ' M v7 AD M 00 AD 00 , --i M r 00 AO c t , O O OO v1 o- (i -, -, ,-, co N „„ -- M 00 O M ,- M '1' 00 ,-, M O C 01 1 , --I ,--- N N N N M M 7C M M A ❑ W x EA- C..) 10 , t- N \O M O O\ O\ M 00 00 N N r AD M M N O\ t 00 ■--I 00 AD ,--� AD ,-- r- '<t VD AD "1 AD V) O N , - Cl ti) r- t„ l r co, rY co, 00 oo O. -, ,--+ M N N • Q I N 0 0 C' r- M N o \D IT , � 0 0 0 o O\ t - \D 7Y -, N t- 00 00 00 00 ,--, M l N N V) O\ \O \O in v> N to " M " N tt O �t CT t� t� <> O " \D tt O M O ON \D 01 01 .�' (' � t- a, d- cn O C M t O o0 ■\p - , \D N 00 --, CT � tri y 'Ci q ^ -, ,- ^ -, N N N N co M rt rt rt vo AD \D t` t` 00 oc O, O, k- Z CSC W v) u Q N 4.., 'ter O ^+ ^- go t� Ct O -, ,--, rt O co 00 rt t O� v) \D v) M 00 M 00 0 O\ O d r- co \O vo -, \O t- co O, t- O N N 00 O\ N VC M 4 - 7t (r vD O O O 00 O AD O r- ( rt t- d, 0 tom, CS , C1 t---, ■c co, 2 7 + �-, ^- D\ O O\ t 0\ 0 0 N \ O CT ^-- co \D vo --, --, t-- \O O.\ v) + AD - (- N \D M O\ \O VC v) M M O Cl O\ 00 r- ,--- N ^ O\ c, v co.. D vO vD O d;, DD t CT v) M r- C. i \O C v cl •-• ^ v'� c Q m `n O\ ^-- co \ D C N v) 00 N d' N co v t - --- C 0 0 C T N \D m , .0 .. -, ^-■ -, ,-■ - N N N M M M M M M M d d - , n vl .� O o a N U d4 O N =. N M ,t v) AD r- O1 g pp - p N p CC p V \ tt 0 g O ^+ N c . O y 3 3 C\ C C C\ C 3, 3 0 0 0 0 0 0 0 0 0 0 O O O ++ -- -, -, -- -, -, N N N N N N N N N N N N N N O m --- --- --- --- --- --- - --- - - --- --- --- --- � , ? O O O O O O O O O O O O O O O O 0000 000 E' R GRS 36 Year Ended Annual Re quire d Actual Percentage September 30 Contribution Contribution Contribute d 1990 $ 742,566 $ 759,432 102.3 % 1991 784,138 795,620 101.5 1992 732,204 732,204 100.0 1993 761,028 761,028 100.0 1994 737,276 737,276 100.0 1995 899,826 899,826 100.0 1996 925,780 956,441 103.3 1997 888,999 930,408 104.7 1998 879,252 879,252 100.0 1999 863,996 854,003 98.8 2000 920,372 920,370 100.0 2001 742,646 743,273 100.1 2002 1,053,863 1,053,863 100.0 2003 1,929,458 1,951,091 101.1 2004 2,343,601 2,343,601 100.0 2005 2,571,109 2,571,109 100.0 2006 2,808,957 2,808,957 100.0 2007 3,030,547 3,150,928 104.0 2008 3,236,241 3,236,241 100.0 2009 3,710,169 3,710,169 100.0 2010 4,153,603 4,153,603 100.0 2011 4,017,435 4,017,435 100.0 2012 4,098,955 4,098,955 100.0 2013 4,701,572 4,701,572 100.0 GRS 37 ANNUAL PENSION COST AND NET PENSION OBLIGATION (GASB STATEMENT NO. 27) Employer FYE September 30 2014 2013 2012 Annual Required Contribution (ARC)* $4,560,918 * ** $ 4,701,572 $ 4,098,955 Interest on Net Pension Obhgation (NPO) (11,300) (11,671) (12,278) Adjustment to ARC (15,814) (16,458) (20,116) Annual Pension Cost (APC) 4,565,432 4,706,359 4,106,793 Contributions made *' 4,701,572 4,098,955 Increase (decrease) in NPO =rz * 4,787 7,838 NPO at beginning of year (145,804) (150,591) (158,429) NPO at end of year ** (145,804) (150,591) 'k Includes expected State contribution h To be determined — *From September 20, 2013 Actuarial Impact Statement THREE YEAR TREND INFORMATION Fiscal Annual Pension Actual Percentage of Net Pension Year Ending Cost (APC) Contribution APC Contributed Obligation 9/30/2011 $ 4,025,459 $ 4,017,435 99.8% $ (158,429) 9/30/2012 4,106,793 4,098,955 99.8% (150,591) 9/30/2013 4,706,359 4,701,572 99.9% (145,804) GRS 38 REQUIRED SUPPLEMENTARY INFORMATION GASB Statement No. 25 and No. 27 The information presented in the required supplementary schedules was determined as part of the actuarial valuations at the dates indicated. Additional information as of the latest actuarial valuation: Valuation Date October 1, 2013 Contnbution Rates: Employer (and State) 41.73% Plan Members 7.00% Actuarial Cost Method Entry Age Normal Amortization Method Level percent of payroll, closed Remaining Amortization Period 30 years Asset Valuation Method 5 -year smoothed market Actuarial Assumptions: Investment rate of return 7.75% Projected salary increases 5.0% to 6.5% depending on age Includes inflation and other general increases at 4.0% Cost of Living adjustments NA GRS 39 SCHEDULE OF CHANGES IN THE EMPLOYER'S NET PENSION LIABILITY AND RELATED RATIOS GASB Statement No. 67 Fiscal year ending September 30, 2014* Total pension liability Service Cost $ 2,809,815 Interest 8,244,618 Benefit Changes - Difference between actual & expected expenence - Assumption Changes Benefit Payments (5,103,582) Refunds (16,479) Net Change in Total Pension Liability 5,934,372 Total Pension Liability - Beginning 106,132,387 Total Pension Liability - Ending (a) $ 112,066,759 Plan Fiduciary Net Position Contributions - Employer and State $ 4,715,684 Contnbutions - Member 791,177 Net Investment Income 5,364,228 Benefit Payments (5,103,582) Refunds (16,479) Administrative Expense (118,694) Other - Net Change in Plan Fiduciary Net Position 5,632,334 Plan Fiduciary Net Position - Beginning 69,081,790 Plan Fiduciary Net Position - Ending (b) $ 74,714,124 Net Pension Liability - Ending (a) - (b) 37,352,635 Plan Fiduciary Net Position as a Percentage of Total Pension Liability 66.67 % Covered Employee Payroll $ 11,302,523 Net Pension Liability as a Percentage of Covered Employee Payroll 330.48 * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. GRS 40 SCHEDULE OF THE EMPLOYER'S NET PENSION LIABILITY GASB Statement No. 67 Total Plan Net Position Net Pension Liability FY Ending Pension Plan Net Net Pension as a % of Total Covered as a To of September 30, Liabihty Position Liability Pension Liability Payroll Covered Payroll 2014* $ 112,066,759 $ 74,714,124 $ 37,352,635 66 67% $ 11,302,523 330 48% * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. GRS 41 SCHEDULE OF CONTRIBUTIONS GASB Statement No. 67 Actuarially Contribution Actual Contribution FY Ending Determined Actual Deficiency Covered as a % of September 30, Contribution Contnbution (Excess) Payroll Covered Payroll 2014- $ 4,560,918 $ 4,560,918 $ - $ 11,302,523 40 35% * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. GRS 42 NOTES TO SCHEDULE OF CONTRIBUTIONS GASB Statement No. 67 Valuation Date: October 1, 2013 Notes Actuarially determined contribution rates are calculated as of October 1, which is two year(s) prior to the end of the fiscal year m which contributions are reported. Methods and Assumptions Used to Determine Contribution Rates: Actuarial Cost Method Entry Age Normal Amortization Method Level Percentage of Payroll, Closed Remaining Amortization Period 23 years Asset Valuation Method 5 -year smoothed market Inflation 4.0% Salary Increases 5.0% to 6.5% depending on age, including inflation Investment Rate of Return 7.75% Retirement Age Experience -based table of rates that are specific to the type of eligibility condition Mortality 60% RP -2000 Combined Healthy Participant Mortality Table for males and females with mortality improvement projected to all future years after 2000 using Scale AA; 40% 1983 Group Annuity Mortality Table for males and females Other Information: Notes See Discussion of Valuation Results on Page 1 GRS 43 SINGLE DISCOUNT RATE GASB Statement No. 67 A single discount rate of 7.75% was used to measure the total pension liability. This single discount rate was based on the expected rate of return on pension plan investments of 7.75 %. The projection of cash flows used to determine this single discount rate assumed that plan member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the difference between the total actuarially determined contribution rates and the member rate. Based on these assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long -term expected rate of return on pension plan investments (7.75%) was applied to all periods of projected benefit payments to determine the total pension liability. Regarding the sensitivity of the net pension liability to changes in the single discount rate, the following presents the plan's net pension liability, calculated using a single discount rate of 7.75 %, as well as what the plan's net pension liability would be if it were calculated using a single discount rate that is 1- percentage -point lower or 1- percentage -point higher: Sensitivity of the Net Pension Liability to the Single Discount Rate Assumption* Current Single Discount 1% Decrease Rate Assumption 1 % Increase 6.75% 7.75% 8.75% $ 49,578,537 $ 37,352,635 $ 27,116,090 * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. GRS 44 GASB 67 - Projection of Contributions Single Discount Rate Determination: 50 -Year Service Cost and Payroll for Contributions from Expense UAL Total Year Current Employees Current Employees Contributions Contributions Contributions (a) (b) (c) (d) (e)= (b)+(c) +(d) 0 $ 10,994,556 1 11,302,523 $ 791,177 $ 2,244,159 $ 2,554,185 $ 5,589,520 2 11,412,699 798,889 2,273,803 2,646,667 5,719,359 3 11,452,859 801,700 2,286,466 2,742,476 5,830,643 4 11,627,007 813,890 2,325,433 2,841,754 5,981,078 5 11,500,185 805,013 2,302,572 2,944,626 6.052,210 6 11,128,433 778,990 2,227,386 3,051,221 6,057,597 7 10,970,989 767,969 2,193,182 3,161,675 6,122 826 8 10,597,865 741,851 2,114,967 3,276,128 6,132945 9 10,282,605 719,782 2,052,750 3,394,724 6,167 256 10 9,752,975 682,708 1,943,976 3,517,613 6,144,297 11 9,286,920 650,084 1,849,311 3,644,950 6,144,346 12 8,669,874 606,891 1,724,666 3,776,897 6,108,455 13 7,656,639 535,965 1,521,571 3,913,621 5,971,157 14 6,979,308 488,552 1,388,013 4,055,294 5 931,858 15 5,835,101 408,457 1,156,699 4,202,096 5.767,252 16 5,298,376 370,886 1,051.977 4,131,771 5,554634 17 4,400,067 308,005 872,770 4,005,372 5186,147 18 3,675,024 257,252 727,909 4,119,733 5,104894 19 3,201,398 224,098 634,427 4,261,130 5,119,655 20 2,480,581 173,641 491,484 4,415,383 5,080.508 21 1,868,482 130,794 372.749 4,575,220 5,078 763 22 1,183,476 82,843 237,254 4,542,491 4,862,588 23 1,066,552 74,659 213,960 1,865,087 2,153,706 24 633,009 44,311 127,396 1,536,124 1,707,831 25 426933 29,885 85,526 1,588,907 1,704,319 26 284,101 19,887 56,712 1,031,155 1,107,754 27 172,773 12,094 34,135 482,973 529,202 28 80,165 5,612 15 544 260,640 281,796 29 - - (766,790) (766,790) 30 - - - (415,585) (415,585) 31 - - - 0 0 32 - - - - - 33 - - - - 34 - - - - - 35 - - - - 36 - - - - 37 - - - - 38 - - - - - 39 - - - - - - - - - 41 - - - - - 42 - - - - 43 - - - 44 - - - - 45 - - - - - 46 - - - - 47 - - - - - 48 - - - - - 49 - - - - - 50 - - - - - GRS 45 GASB 67 Single Discount Rate Determination: 100 -Year Projection of Cash Flows Projected Projected Projected Beginning Projected Total Projected Benefit Administrative Investment Projected Ending Plan Year Plan Net Position Contributions Payments Expenses Earnings at 7.75 % Net Position (a) (b) (c) (d) (e) (f)= (a) +(b) (c) (d) +(e) 1 5 58,900,850 8 5,589,520 $ 5,120,061 $ 118,694 $ 4,578,154 $ 63,829,770 2 63,829,770 5,719,359 5,247,700 119,851 4,960,185 69,141,764 3 69,141,764 5,830,643 5,329,313 120,272 5,372,977 74,895,798 4 74,895,798 5,981,078 5,620,640 122,101 5,813,488 80.947,623 5 80,947,623 6,052,210 6,089,967 120,769 6,267,412 87,056,509 6 87,056,509 6,057,597 6,419,436 116,865 6,728,676 93,306 480 7 93,306,480 6,122,826 6,909,897 115,212 7,196,941 99,601 139 8 99 601,139 6,132,945 7,360,757 111,294 7,668,166 105 930 199 9 105,930,199 6,167,256 7,956,112 107,983 8,137,459 112,170,819 10 112,170,819 6,144,297 8,504,379 102,421 8,599,597 118 307,913 11 118,307,913 6,144,346 9,186,609 97,527 9,049,467 124,217,590 12 124217,590 6,108,455 10,210,120 91,047 9,467,427 129,492.304 13 129,492,304 5,971,157 10,915,307 80,407 9,844,585 134,312,331 14 134,312,331 5,931,858 11,944,192 73,293 10,177,788 138,404,493 15 138,404,493 5,767,252 12,441,383 61,278 10,470,221 142 139,304 16 142,139,304 5,554,634 13,236,752 55,641 10,721,552 145 123,097 17 145 123,097 5,186,147 13,829,493 46,208 10,916,603 147,350.145 18 147.350,145 5,104,894 14,204 111 38,594 11,072,153 149,284487 19 149,284,487 5,119,655 14,737,219 33,620 11,202,542 150,835 846 20 150,835,846 5,080,508 15,154 267 26,050 11,305,713 152 041,750 21 152,041,750 5,078,763 15,591,016 19,622 11,382 740 152,892,615 22 152 892,615 4,862,588 15,521,440 12,428 11,443,381 153 664 716 23 153,664,716 2,153,706 15,704,020 11,200 11,393,312 151,496,513 24 151,496,513 1,707,831 15,653,378 6,648 11 210,420 148,754,739 25 148,754,739 1,704,319 15,548,910 4,483 11,001,854 145,907,518 26 145,907,518 1,107,754 15,391,590 2,983 10,764,548 142.385 247 27 142,385,247 529,202 15,204,341 1,814 10,476,737 138 185,030 28 138,185,030 281,796 14,997,343 842 10,149,720 133,618,361 29 133 618,361 (766,790) 14,698,301 - 9,767,332 127 920,602 30 127 920,602 (415 585) 14,385,832 - 9 350,994 122 470,178 31 122 470,178 0 14,055,357 - 8,956,956 117,371 778 32 117,371,778 - 13,726,086 - 8,574,351 112,220043 33 112,220043 - 13,371,692 - 8,188,568 107036,919 34 107,036,919 - 13,005,349 - 7,800,807 101 832 377 35 101 832 377 - 12 625,146 - 7,411,913 96,619,144 36 96,619,144 - 12,227,650 - 7,023 003 91 414 497 37 91414,497 - 11,814,561 - 6,635,352 86235,288 38 86 235,288 - 11 386,069 - 6,250,257 81 099 477 39 81,099477 - 10,945,833 - 5,868,973 76 022 616 4(1 76,022,616 - 10,492,632 - 5,492,750 71 022 734 41 71 022,734 - 10,027,999 - 5,122,927 66,117 662 42 66,117,662 - 9,553,535 - 4,760827 61324,955 43 61 324,955 - 9071,208 - 4,407,733 56661,480 44 56 661,480 - 8,583,107 - 4064,875 52 143,249 45 52 143,249 - 8,091,992 - 3 733,388 47,784,645 46 47,784,645 - 7 600,227 - 3,414,296 43,598 714 47 43 598,714 - 7,109,113 - 3 108,562 39,598,163 48 39,598,163 - 6,621,468 - 2 817,063 35 793 758 49 35 793 758 - 6,140,630 - 2540,507 32,193 635 50 32 193,635 - 5,668,507 - 2,279,451 28 804 578 GRS 46 GASB 67 Single Discount Rate Determination: 100 -Year Projection of Cash Flows (cont'd) 50 32,193,635 - 5,668,507 - 2,279,451 28804.578 51 28,804,578 - 5,207,836 - 2,034,317 25,631,059 52 25,631,059 - 4,761,077 1,805,358 22,675,339 53 22,675,339 4,329,936 - 1,592,684 19.938,087 54 19,938,087 3,916,412 - 1,396,272 17.417,947 55 17,417,947 - 3,522,198 - 1,215,952 15,111,702 56 15,111,702 3,148,353 - 1,051,435 13.014,783 57 13,014,783 - 2,796,519 - 902303 11,120,567 58 11,120,567 - 2,467 226 - 768,023 9 421,364 59 9,421,364 - 2,159,800 - 648,025 7,909,589 60 7,909,589 - 1,874,499 - 541,712 6 576,802 61 6,576,802 1,612,202 - 448,395 5,412,995 62 5,412,995 - 1,373 381 - 367,282 4.406,895 63 4,406,895 - 1,157,847 - 297,505 3,546,552 64 3,546,552 - 964,806 - 238,169 2,819,915 65 2.819,915 - 794,067 - 188,347 2,214,195 66 2 214,195 - 645,764 - 147,044 1,715,476 67 1715,476 - 517,758 - 113,261 1.310,978 68 1310,978 - 409,028 - 86,047 987,996 69 987,996 - 318 671 - 64,452 733,776 70 733,776 - 244.292 - 47,578 537,062 71 537,062 - 184.330 - 34,613 387,345 72 387,345 - 137,071 - 24,807 275,081 73 275,081 - 100,178 - 17,509 192,412 74 192,412 - 71,883 - 12,178 132,708 75 132,708 50,762 - 8,355 90,301 76 90,301 35,331 - 5,655 60,625 77 60,625 - 24,237 - 3,777 40,165 78 40,165 - 16,350 - 2,491 26,306 79 26,306 10,846 - 1,626 17,087 80 17,087 - 7,135 - 1,053 11,005 81 11,005 - 4,653 - 676 7,028 82 7,028 - 3,009 - 430 4,450 83 4,450 1,930 - 271 2,791 84 2,791 - 1,229 - 170 1,732 85 1,732 - 772 - 105 1,065 86 1,065 - 480 - 64 649 87 649 - 298 - 39 390 88 390 182 - 23 231 89 231 111 14 134 90 134 - 67 - 8 75 91 75 - 39 - 4 40 92 40 - 20 - 2 22 93 22 - 12 - 1 11 94 11 7 - 1 5 95 5 - 3 - 0 2 96 2 - 2 - 0 0 97 0 - 0 - 0 0 98 0 - 0 - 0 0 99 0 - 0 - 0 0 100 0 - - - 0 0 GRS 47 GASB 67 Single Discount Rate Determination: 100 -Year Projection to Determine Cross -over Date Present Value of Present Value of Present Value of Funded Benefit Unfunded Benefit Benefit Projected Unfunded Portion Payments using Payments using Payments using Beginning Plan Projected Benefit !Ended Portion of of Benefit Expected Return Municipal Bond Single Discount Year Net Position Payments Benefit Payments Payments Rate (v) Rate (vt) Rate (sdr) (c) (b) (c) (d) (e) (f)= (d) *v ^((a)- 5) (g)= (e) "vf ^((a)- 5) (h)= ((c) /(1 +sdr) ^(a- 5) 1 S 58,900,850 $ 5,120,061 $ 5,120,061 $ - $ 4,932,493 $ - S 4,932,493 2 63,829,770 5,247 700 5,247,700 - 4,691,839 - 4,691,839 3 69,141,764 5,329,313 5,329,313 - 4,422,095 - 4,422,095 4 74,895,798 5,620,640 5,620,640 - 4,328,379 - 4,328,379 5 80,947,623 6,089,967 6,089,967 - 4,352,484 - 4,352484 6 87,056,509 6,419436 6,419,436 - 4,257,962 - 4,257,962 7 93,306,480 6,909,897 6,909,897 4,253,626 - 4,253,626 8 99,601,139 7,360,757 7,360,757 - 4,205,261 - 4,205,261 9 105,930,199 7,956,112 7,956,112 - 4,218,461 - 4,218,461 10 112,170.819 8,504,379 8,504,379 - 4,184,836 - 4,184,836 11 118 307,913 9,186,609 9,186,609 - 4,195,404 - 4,195,404 12 124,217,590 10,210,120 10,210,120 - 4,327,451 - 4,327,451 13 129,492,304 10,915,307 10,915.307 - 4,293,584 - 4,293,584 14 134,312,331 11,914,192 11,944,192 - 4,360,372 - 4,360,372 15 138,404,493 12,441,383 12,441,383 - 4,215,199 - 4,215,199 16 142,139304 13,236,752 13,236,752 - 4,162,111 - 4,162,111 17 145,123,097 13,829,493 13,829,493 - 4,035,721 - 4,035,721 18 147,350 145 14,204,111 14,204,111 - 3,846,907 - 3 846,907 19 149,284,487 14,737,219 14.737,219 - 3.704,212 3,704,212 20 150,835,846 15,154,267 15,154,267 - 3,535,070 - 3,535,070 21 152,041,750 15,591,016 15 591,016 - 3,375,361 - 3,375,361 22 1 15,521,440 15,521,440 - 3,118,606 3,118,606 23 153,664716 15,704,020 15,704020 - 2,928.344 - 2,928,344 24 151,496,513 15,653,378 15,653,378 - 2,708,956 - 2,708,956 25 148754,739 15,548,910 15,548,910 - 2,497,334 - 2,497334 26 145,907,518 15,391,590 15,391,590 - 2,294,261 - 2,294,261 27 142,385 247 15 204,341 15,204,341 2,103,341 - 2,103,341 28 138,185,030 14,997,343 14,997,343 - 1925,481 - 1925,481 29 133,618,361 14,698 301 14,698,301 - 1,751,357 - 1,751,357 30 127,920,602 14,385,832 14,385,832 - 1,590,835 - 1590,835 31 122 470,178 14,055,357 14,055,357 1,442,497 - 1,442,497 32 117,371,778 13,726,086 13,726,086 - 1,307,382 - 1,307,382 33 112,220043 13,371692 13,371,692 - 1,182,020 - 1,182020 34 107,036,919 13,005349 13,005,349 - 1,066,948 - 1,066,948 35 101,832,377 12,625 146 12,625,146 - 961 259 - 961,259 36 96619,144 12,227,650 12,227,650 - 864,032 - 864,032 3 / 01 414,497 11,814,561 11,814 561 - 774,795 - 774 795 38 86,235,288 11,386,069 11,386,069 - 692,988 - 692,988 79 81,099,477 10.945 833 10,945,833 - 618,278 - 618,278 40 76,022 616 10.492,632 10 492,632 - 550,050 - 550,050 41 71,022,734 10,027 999 10,027,999 - 487,882 - 487,882 42 66,117,662 9,553,535 9,553,535 - 431 367 - 431,367 43 61,324,955 9,071,208 9,071,208 - 380,129 - 380,129 44 56,661,480 8,583,107 8 583,107 - 333,805 - 333 805 45 52143,249 8,091,992 8 091,992 - 292,070 - 292,070 46 47 784 645 7,600,227 7 600,227 - 254,589 - 254,589 47 43,598,714 7109,113 7,109,113 - 221,010 - 221,010 48 39 598 163 6,621,468 6,621,468 - 191,044 - 191,044 49 35 793 758 6 140,630 6 140 630 164,428 - 164,428 50 32 191,635 5,668,507 5.668,507 - 140,868 - 140868 GRS 48 GASB 67 Single Discount Rate Determination: 100 -Year Projection to Determine Cross -over Date (cont'd) Present Value of Present Value of Present Value of Funded Benefit Unfunded Benefit Benefit Projected Unfunded Portion Payments using Payments using Payments using Beginning Plan Projected Benefit Funded Portion of of Benefit Expected Return Municipal Bond Single Discount Year Net Position Payments Benefit Payments Payments Rate (v) Rate (4) Rate (sdr) (a) (b) (c) (d) (e) (0= (d) *v ^((a)- 5) (g)= (e) *vf ^((a)- 5) (10= ((c)l(1 +sdq^(a- 5) 51 $ 28,804,578 $ 5,207,836 $ 5,207,836 $ - $ 120,112 $ - $ 120,112 52 25,631,059 4,761,077 4,761,077 - 101,910 - 101,910 53 22,675,339 4,329,936 4,329,936 - 86,015 - 86,015 54 19,938,087 3,916,412 3,916,412 - 72,204 - 72,204 55 17,417,947 3,522,198 3,522,198 60,266 - 60,266 56 15,111,702 3,148,353 3,148,353 - 49,995 - 49,995 57 13,014,783 2,796,519 2,796,519 - 41,214 - 41,214 58 11,120,567 2,467,226 2,467,226 - 33,745 - 33,745 59 9,421,364 2,159,800 2,159,800 - 27 416 - 27,416 60 7,909,589 1,874,499 1,874,499 - 22,083 - 22,083 61 6,576,802 1,612,202 1,612,202 - 17,627 - 17,627 62 5,412,995 1,373,381 1,373,381 - 13,936 - 13,936 63 4,406,895 1,157,847 1,157,847 - 10,904 - 10,904 64 3,546,552 964,806 964,806 - 8 432 8,432 65 2,819,915 794,067 794,067 - 6,441 - 6,441 66 2,214,195 645,764 645,764 4 861 - 4,861 67 1,715,476 517,758 517,758 - 3,617 3,617 68 1,310,978 409,028 409 028 - 2,652 - 2,652 69 987,996 318,671 318,671 - 1,918 - 1,918 70 733,776 244,292 244,292 - 1361 - 1,364 71 537,062 184,330 184,330 - 955 - 955 72 387,345 137,071 137,071 - 659 - 659 73 275,081 100,178 100,178 - 447 - 447 74 192,412 71,883 71,883 - 298 - 298 75 132,708 50,762 50,762 195 - 195 76 90,301 35,331 35,331 - 126 - 126 77 60,625 24,237 24,237 - 80 - 80 78 40,165 16,350 16,350 - 50 - 50 79 26,306 10,846 10,846 - 31 - 31 80 17,087 7 135 7,135 - 19 - 19 81 11,005 4 653 4,653 11 - 11 82 7,028 3 009 3,009 - 7 - 7 83 4,450 1 930 1,930 - 4 - 4 84 2,791 1 229 1,229 - 2 - 2 85 1,732 772 772 1 - 1 86 1,065 480 480 - 1 - 1 87 649 298 298 - 0 - 0 88 390 182 182 - 0 - 0 89 231 111 lll - 0 0 90 134 67 67 - 0 - 0 91 75 39 39 - 0 - 0 92 40 20 20 - 0 - 0 93 22 12 12 - 0 - 0 94 11 7 7 - 0 - 0 95 5 3 3 - 0 - 0 96 2 2 2 - 0 - 0 97 0 0 0 - 0 - 0 98 0 0 0 - 0 - 0 99 0 0 0 0 0 0 0 100 0 - - - - - - Totals $ 121,864,383 $ - $ 121,864,383 GRS 49 Projection of Plan Net Position and Benefit Payments $ [thousands] 180,000 160,000 i ��I • 140,000 •♦ t • 1 • • 120,000 / 100,000 • r • 80,000 // 1 / • r � 60,000 -1 • • 40,000 • • • • 20,000 - •�` 0 --� n O m lD Ol N ifl CO N o m UJ Ol N ul CO '-I I o m VD O1 N LIl 00 H h o - - - a-+ N N N 03 lD l0 lD i\ n n 00 Co 03 01 01 al O - -- Projected Plan Net Position Projected Benefit Payments for Current Members Year GRS SECTION E MISCELLANEOUS INFORMATION GRS 50 RECONCILIATION OF MEMBERSHIP DATA From 10/1/12 From 10 /1 /11 To 10/1/13 To 10/1/12 A. Active Members 1. Number Included in Last Valuation 146 144 2. New Members Included in Current Valuation 5 9 3. Non - Vested Employment Terminations (3) (2) 4. Vested Employment Terminations (4) (2) 5. DROP Participation (2) (3) 6. Service Retirements (1) 0 7. Disabihty Retirements 0 0 8. Deaths 0 0 9. Number Included in This Valuation 141 146 B. Terminated Vested Members 1. Number Included in Last Valuation 4 3 2. Additions from Active Members 4 2 3. Lump Sum Payments/Refund of Contributions (1) (1) 4. Payments Commenced (1) 0 5. Deaths 0 0 6. Other -- Return to Actives 0 0 7. Number Included in This Valuation 6 4 1C. DROP Plan Members 1. Number Included in Last Valuation 14 15 2. Additions from Active Members 2 3 3. Retirements (4) (4) 4. Deaths Resulting in No Further Payments 0 0 5. Other 0 0 1 6. Number Included in This Valuation 12 14 I D. Service Retirees, Disabilit/ Retirees and Beneficiaries I 1. Number Included in Last Valuation 98 95 2. Additions from Active Members 1 0 3. Additions from Terminated Vested Members 1 0 4. Additions from DROP Plan 4 4 5. Deaths Resulting in No Further Payments 0 (1) 6. Deaths Resulting in New Survivor Benefits 0 0 7. End of Certain Period - No Further Payments 0 0 8. Other -- Lump Sum Distributions 0 0 9. Number Included in This Valuation 104 98 GRS 51 ACTIVE PARTICIPANT SCATTER ` Years of Service to Valuation Date ` Age Group 0 - 1 -2 2 -3 3 -4 4 -5 5 -9 10 -14 15 -19 20 -24 25+ Totals 20-24 NO 0 2 1 0 0 0 0 0 0 0 3 TOT PAY 0 116,678 57,490 0 0 0 0 0 0 0 174,168 AVG PAY 0 58,339 57,490 0 0 0 0 0 0 0 58,056 25 -29 NO 2 2 2 2 2 11 0 0 0 0 21 TOT PAY 104,674 110,748 117,701 122,553 154,276 815,476 0 0 0 0 1,425,428 AVG PAY 52,337 55,374 58,851 61,277 77,138 74,134 0 0 0 0 67,878 30 -34 NO 3 1 1 1 2 14 2 0 0 0 24 TOT PAY 157,011 56,258 65,300 55,277 123,354 996,831 179,497 0 0 0 1,633,528 AVG PAY 52,337 56,258 65,300 55,277 61,677 71,202 89,749 0 0 0 68,064 35 -39 NO 0 1 0 1 0 16 10 3 0 0 31 TOT PAY 0 54,234 0 62,726 0 1,153,472 931,174 276,575 0 0 2,478,181 AVG PAY 0 54,234 0 62,726 0 72,092 93,117 92,192 0 0 79,941 40 -44 NO 0 0 1 0 0 7 19 12 0 0 39 TOT PAY 0 0 57,668 0 0 497,677 1,593,433 1,189,403 0 0 3,338,181 AVG PAY 0 0 57,668 0 0 71,097 83,865 99,117 0 0 85,594 45 -49 NO 0 0 0 1 1 3 7 5 0 0 17 TOT PAY 0 0 0 53,987 61,116 173,440 584,044 562,771 0 0 1,435,358 AVG PAY 0 0 0 53,987 61,116 57,813 83,435 112,554 0 0 84,433 50 -54 NO 0 0 0 0 0 1 1 2 0 0 4 TOT PAY 0 0 0 0 0 79,564 86,437 185,250 0 0 351,251 AVG PAY 0 0 0 0 0 79,564 86,437 92,625 0 0 87,813 55 -59 NO 0 0 0 0 0 1 0 1 0 0 2 TOT PAY 0 0 0 0 0 66,155 0 92,306 0 0 158,461 AVG PAY 0 0 0 0 0 66,155 0 92,306 0 0 79,231 60 -64 NO 0 0 0 0 0 0 0 0 0 0 0 TOT PAY 0 0 0 0 0 0 0 0 0 0 0 AVG PAY 0 0 0 0 0 0 0 0 0 0 0 TOT NO 5 6 5 5 5 53 39 23 0 0 141 TOT AMT 261,685 337,918 298,159 294,543 338,746 3,782,615 3,374,585 2,306,305 0 0 10,994,556 AVG AMT 52,337 56,320 59.632 58,909 67,749 71,370 86,528 100,274 0 0 77,976 GRS 52 INACTIVE PARTICIPANT SCATTER - Deceased with Terminated Vested Disabled Retired Beneficiary Total Total Total Total Age Group Number Benefits Number Benefits Number Benefits Number Benefits Under 20 - - - - - - - - 20 -24 - - - - - - - - 25 -29 - - - - - - - - 30 -34 3 45,197 - - - - - - 35 -39 1 15,137 - - - - - - 40 -44 2 69,469 - - 1 82,878 - - 45 -49 - - - - 17 981,798 1 23,843 50 -54 - - 2 43,710 27 1,535,035 - - 55 -59 - - 4 78,923 20 796,660 - - 60 -64 - - 3 85,776 14 593,918 - - 65 -69 - - 3 52,487 11 408,107 1 9,397 70 -74 - - 2 25,903 6 166,434 - - 75 -79 - - 1 25,086 2 79,329 - - 80 -84 - - - - - - 1 26,671 85 -89 - - - - - - - - 90 -94 - - - - - - - - 95 -99 - - - - - - - - 100 & Over - - - - - - - - Total 6 129,803 15 311,885 98 4,644,159 3 59,911 Average Age 37 63 57 65 GRS SECTION F SUMMARY OF PLAN PROVISIONS GRS 53 SUMMARY OF PLAN PROVISIONS A. Ordinances Plan established under the Code of Ordinances for the City of Boynton Beach, Florida, Chapter 18, Article III, and was most recently amended under Ordinance No.09 -021 passed and adopted on its second reading on April 21, 2009. The Plan is also governed by certain provisions of Chapter 185, Florida Statutes, Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. The Plan has also amended the definition of pensionable compensation effective June 18, 2013 in compliance with Senate Bill 1128. B. Effective Date August 15, 1981 C. Plan Year October 1 through September 30 D. Type of Plan Qualified, governmental defined benefit retirement plan; for GASB purposes it is a single employer plan. E. Eligibility Requirements All full -time police officers are eligible to participate on the first day of employment. F. Credited Service Service is measured as the aggregate numbers of years and fractional parts of years of service for which a police officer made Member Contnbutions to the plan. No service is credited for any periods of employment for which the member received a refund of their contributions. G. Compensation Total cash remuneration including up to 300 hours of overtime and lump sum payments for the lesser of the amount of sick and vacation leave accumulated as of June 18, 2013 or the amount cashed out at retirement, but exclusive of any payments for extra duty or special detail work. H. Average Final Compensation (AFC) The average of Compensation over the highest 5 years during the last 10 years of Credited Service. GRS 54 I. Normal Retirement Eligibility: A member may retire on the first day of the month coincident with or next following the earliest of: (1) age 55 and 10 years of Credited Service, or (2) age 50 and 15 years of Credited Service, or (3) 20 years of Credited Service regardless of age. Benefit: 3 5% of AFC multiplied by years of Credited Service. Benefit is limited to 100% of AFC and the provisions of Internal Revenue Code Section 415. Normal Form of Benefit. 10 Years Certain and Life thereafter; other options are also available. COLA None Supplemental Benefit: All retirees in pay status are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1% of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distribution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary. J. Early Retirement Eligibility: A member may elect to retire earlier than the Normal Retirement Eligibility upon attainment of age 50 and 10 years of Credited Service. Benefit: The Normal Retirement Benefit is reduced by 1.5% for each year by which the Early Retirement date precedes the Normal Retirement date. For this purpose, the Normal Retirement date is the earlier of the date the member would have attained age 55 or completed 20 years of Credited Service had the member continued employment as a police officer. Normal Form of Benefit: 10 Years Certain and Life thereafter; other options are also available. COLA. None GRS 55 Supplemental Benefit: All retirees in pay status are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1% of pay contnbution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distribution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary. K. Delayed Retirement Same as Normal Retirement taking into account compensation earned and service credited until the date of actual retirement. L. Service Connected Disability Eligibility: Any member who becomes totally and permanently disabled and unable to render useful and efficient service as a police officer as a result of an act occurring in the performance of service for the City is immediately eligible for a disability benefit. Benefit: 66 2/3% of the member's basic rate of earnings in effect on the date of disability, reduced by amounts payable under Worker's Compensation and Social Secunty PIA with a minimum benefit being the greater of the accrued Normal Retirement benefit on the date of disability or 42% of AFC. Normal Form of Benefit: 10 Years Certain and Life thereafter; other options are also available. COLA: None Supplemental Benefit: All retirees in pay status are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1% of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distnbution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary. M. Non - Service Connected Disability Eligibility. Any member with 10 years of Credited Service who becomes totally and permanently disabled and unable to render useful and efficient service as a police officer is eligible for a disability benefit. Benefit: The accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of disability with a minimum benefit equal to 25% of AFC and a maximum benefit equal to 60% of AFC. GRS 56 Normal Form of Benefit: 10 years Certain and Life thereafter; other options are also available. COLA None Supplemental Benefit: All retirees in pay status are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1% of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distnbution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary N. Death in the Line of Duty Eligibility: Any member whose death is determined to be the result of a service incurred injury is eligible for survivor benefits regardless of Credited Service. Benefit Spouse will receive the accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of death with a minimum benefit equal to 30% of AFC. If there is no spouse, benefits will be paid to the deceased member's estate. Normal Form of Benefit: Paid until death of spouse. COLA. None Supplemental Benefit All retirees and beneficiaries in pay status are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1 % of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distribution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary. O. Other Pre- Retirement Death Eligibility: Members are eligible for survivor benefits after the completion of 10 or more years of Credited Service Benefit: Spouse will receive the accrued Normal Retirement Benefit taking mto account compensation earned and service credited as of the date of death. If there is no spouse, benefits will be paid to the deceased member's estate. GRS 57 Normal Form of Benefit: Paid until death or remarriage of spouse; or 10 years to the member's estate. COLA: None Supplemental Benefit: All retirees and beneficiaries in pay status are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1% of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distribution is the number of shares multiplied by the share value The benefit ceases upon the later of the death of the retired member or beneficiary. The beneficiary of a plan member with less than 10 years of Credited Service at the time of death will receive a refund of the member's accumulated contributions. P. Post Retirement Death Benefit determined by the form of benefit elected upon retirement. Q. Optional Forms In lieu of electing the Normal Form of benefit, the optional forms of benefits available to all retirees are a Single Life Annuity, the 50 %, 66 2/3 %, 75% and 100% Contingent Annuitant options and the 50 %, 66 2/3 %, 75% and 100% Survivor Annuity options. R. Vested Termination Eligibility: A member has earned a non - forfeitable right to Plan benefits after the completion of 5 years of Credited Service if they elect to leave their accumulated contributions m the fund. Benefit: The benefit is the member's accrued Normal Retirement Benefit as of the date of termination. For members with at least 5 years of Credited Service, the benefit begins on the date that would have been the member's Normal Retirement date had they continued employment until attaining age 55 with 10 years of Credited Service or upon reaching what would have been 20 years of Credited Service. Alternatively, members with at least 10 years of Credited Service can elect a reduced Early Retirement benefit any time after age 50. Normal Form of Benefit: 10 Years Certain and Life thereafter; other options are also available. COLA: None GRS 58 Supplemental Benefit: Once in pay status, all retirees are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1 % of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree's distribution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary. Members terminating employment with less than 5 years of Credited Service will receive a refund of their own accumulated contributions. S. Refunds Eligibility All members terminating employment with less than 5 years of Credited Service are eligible. Optionally, vested members (those with 5 or more years of Credited Service) may elect a refund in lieu of the vested benefits otherwise due. Benefit: Refund of the member's contributions T. Member Contributions 7% of Compensation U. Employer Contributions Chapter 185 Premium Tax Refunds and any additional amount determined by the actuary needed to fund the plan properly according to State laws. V. Changes from Previous Valuation There have been no changes since the last valuation. W. 13 Check As described under the Supplemental Benefit subsections, a thirteenth check will be paid to retirees on each October 1 of each year following December 1, 2006. GRS 59 X. Deferred Retirement Option Plan Eligibility: Plan members who have less than 30 years of Credited Service but have met one of the following cnteria are eligible for the DROP: (1) age 55 and 10 years of Credited Service, or (2) age 50 and 15 years of Credited Service, or (3) 20 years of Credited Service regardless of age. Members who meet eligibility must submit a written election to participate in the DROP. Benefit: The member's Credited Service and FAC are frozen upon entry into the DROP. The monthly retirement benefit as described under Normal Retirement is calculated based upon the frozen Credited Service and FAC. Maximum DROP Period: The earlier of 5 years of participation in the DROP or 30 years of employment. Interest Credited: The member's DROP account is credited at an interest rate based upon the option chosen by the member. Members must elect from 1 of the 3 following options: 1. Gain or loss at the same rate earned by the Plan, or 2. Guaranteed rate of 7 %, or 3. A percentage of the DROP credited at the same rate earned by the Plan and the remaining percentage credited with earnings at a guaranteed rate of 7% Normal Form of Benefit: Options include a lump sum, equal annual payments over 5 years, or monthly installments based upon actuarial tables until the balance is paid out. COLA: None Supplemental Benefit: DROP retirees are entitled to a monthly supplemental pension benefit paid in a lump sum on October 1 of each year. The supplemental benefit is funded by a 1% of pay contribution from the members and a 1% of pay contribution from the Chapter 185 money. The benefit pool is divided according to the total number of shares of all eligible retirees on a pro -rata basis. The number of shares allotted to each eligible retiree is the sum of credited service at retirement (maximum of 20 years) and the number of years the participant has been retired (maximum of 20 years). An individual retiree' s distribution is the number of shares multiplied by the share value. The benefit ceases upon the later of the death of the retired member or beneficiary. Y. Other Ancillary Benefits There are no ancillary benefits not required by statutes but which might be deemed a City of Boynton Beach Municipal Police Officers' Retirement Fund liability if continued beyond the availability of funding by the current funding source. GRS BOYNTON BEACH POLICE PENSION FUND APPLICATION FOR DISABILITY/PENSION BENEFITS PLEASE PRINT OR TYPE 1. a. Name of Employee: je Greo pr (Last) (First) / (MI) b. Social Security Number. 1 3 ' c. Date of Birth: - ic 1 1 (Attach proof) Month-id d. Home Telephone Number. (Area Code) Number e. Home Address: Address Stye t State L. Zip Code f. Permanent address to which check and/or correspondence should be sent: S Address r L C fate Zip Code 2. a. Are you currently married: ){ Yes No If yes, please complete the following: I. Name of Spouse:N (Last (First f ii. Spouse's Social Security Number. iii. Spouse's Date of Birth: nq 1 r' 75 (Attach proof) Mo th- Day -Year iv. Date of Marriage: • / *I (Attach proot) Month-D -Year Page 1 of 4 3. Names and Dates of Birth of Child(ren): Name Date of Birth (( fatiOaaof (Attach additional page if needed) 4. Names of Your Living Parents: ker.tvy a. Mother. � rn"►( 5. a. Date of Hire by the City of Boynton Beach, Florida, as a Sworn Police Officer: , ,900 Month ay -Year b. Current Position: /l C)J i CPC 6. I plan to retire on: Month -Day -Year 7. Type of retirement for which you are applying (check one): Normal Retirement Early Retirement Une-of -Duty Disability kc Non - Line -of -Duty Disability 8. If you are applying for a disability retirement, please complete the following: / a. Data disability commenced: 1 0 1 aa'1 Got l Month- Day -Year b. Nature and cause of disability: r px (rASk (.Ausred b9ck kixe -.( ra1tae., Or (10-1 . 1i -- Ognq ati ►` 6. by ,E A - 9( Page 2 of 4 c. Did your disability result from any of the following: Yes No (1) Use of drugs, intoxicants or narcotics? 3( (2) Due to a fight, riot, civil insurrection, or crime? —A-- X (3) From an injury or disease sustained while you were Al serving in any armed forces? (4) After your employment with the City of Boynton Beach terminated? (5) While working for anyone other than the CityofBoynton Beach and arising out of such employment? d. A copy of my doctor's medical opinion is attached. X e. Please list any doctor's that have treated you within the last five years and their address and phone number on a separate sheet of paper. f. Please indicate the name and address of your designated member of the medical committee: NOTE: If you are applying for a disability benefit, records must be filed to show that the disability is total and permanent. If application is made for a line -of -duty disability, copies of workers' compensation records must also be filed to show that the disability occurred in the Tine -of -duty. Also, the Board of Trustees may require you to be examined by a doctor selected by the Board. NOTICE: It is a first degree misdemeanor to make a false or misleading statements to obtain retirement benefits. In addition to any applicable criminal penalty, upon conviction a participant or beneficiary of this plan may, in the discretion of the board of trustees, be required to forfeit the right to receive any or all benefits to which the person would otherwise be entitled under this plan. Page 3 of 4 Acknowledgments 1 hereby certify that the above statements are true and correct to the best of my knowledge. I understand that a false statement may disqualify me for benefits. 1 have reviewed the Designation of Beneficiary Form filed with the Board of Trustees and I hereby certify its accuracy. If I desire to change my designated beneficiary(ies), I will file a new Designation of Beneficiary Form with this Application. I hereby authorize the release of any and all medical records induding but not limited to the complete history records in possession of all doctors listed below concerning my illness and/or treatment. A copy of this document will be treated in the same manner and have the same effect as an original. I hereby waive my right of confidentiality of my medical records and other medical evidence in order that my application for disability benefits may be properly processed. I understand that in so doing, such records will be discussed during one or more public meetings and will become public record. I understand that the Board(s) will rely upon this waiver and that I will not be able to withdraw same at a later date. I agree to cooperate fully with the Board of Trustees of the Boynton Beach Police Pension Fund in making available to the Board, or authorized agents of the Board, information which reasonably relates to the initial payment of or continuing eligibility for payment of benefits from the Fund. I hereby agree to indemnify and hold harmless the City of Boynton Beach and the Pension Plan from and against any and all daims, demands, or causes of action of any kind or nature resulting from or in connection with the City of Boynton Beach's release of the results of the undersigned's annual physical to the Pension Plan and from. and against any resulting losses, costs, expenses, reasonable attorneys' fees, liabilities, damages, orders, judgments, or decrees in connection therewith. Dated this ,20/ 3 day of. „,�, � _ Witness y U Signature of Partici ess Printed nam> • Participant STATE OF FLORIDA COUNTY OF PALM BEACH SWORN 0 (or affirmed) and subscribed before me this 0 day of ,20 by wha iepersonally kn to m - who produced the fol ientification: '. N ry Public t .• • S F. Print, type or stamp name of Notary in addition to seal: %Ai mEasa. •# Page 4 of 4 AUTHORIZATION TO USE OR DISCLOSE HEALTH INFORMATION Name: a r o c r' ( j 3 t•o. Date of Birth: ®1 1 1 HEREBY AUTHORIZE the disclosure to and the use of the above named individual's health information as described bebw. 1. The folowing individual(s) or organization(s) are authorized to make the die: Any and al Physicians, Psychiatrist/Psychologists, Facilities and/or Hospitals who have provided treatment 2. The type of information to be used or disclosed is my entire medical/health record. 3. I understand that the /formation in my medicaUteaNh records may include /formation relating to sexually transmitted disease, acquired immunodeficiency syndrome (AIDS), or human immurnod Eiden y virus (HIV), information about behavioral or mental health services, and trea/Tient for alcohol and drug abuse. 4. The information identified above may be used by or disclosed to: Name of dent Boynton Beach Poke Ofiibers' Pension Fund do The Law Offices of Perry & Jensen, LLC Address: 400 Executive Ceder Drive - Suite 207 West Palm Beach, FL 33401-2922 5. This information for which I am authorizing demure wi be used for the folowing purpose: To facilitafa the Board of Trustees of the Fund in the carrying out its duty to review, c o and detemd ne my application for disabilfy retir?eirnent I hereby waive the right of confidentially of medical/health records arid or medical evidence in the custody of the Board ofTrustees or shootere.1 fairer understand that such records wit be discussed during one or more Oleic meetings and mil become public record. I understand that the Board of Trustees will rely upon this waiver. 6. t understand that I have a right to revoke this authorization at any time. I understand that if I revoke this authorization, I must do so in writing and prekent my written revocation to the medicableafth care provider. I understand that the revocation wi not apply to iormation that has already been released in response to this authorization. I understand that the revocation MI not applyto my insurance company when the law provides my insurer rah the right to contest a claim under my insurance policy. 7. This authorization will expire six (6) months from the date on which it was signed. 8. I understand that once the above information is disclosed, 11 may be re-disclosed by the recipient and the information may not be protected by federal privacy laws or reguiatio ns. 9. I understand authorizing the use or disclosure of the information identified above is voluntary. 10. I - ; . _ .:• the use of photocopy of this document in phase of the original. mo) ,-- - , = l r Date If signed by = _ al = = I" ' ; relations 7 . to patient f / / r D aZ Signature of Warless Date BBJlpah - oepmber3.2012 FMB Police AA Auld &dose Health kdo.wpd V a o i - 4 : ° c#3 0 Z ° O 3 ?a 3 Z .9 a . a f x c y 3 O N --A _ ...1 7D W �= N _7 Z iii 1 .::. rt C T �z 3 Fa o0 N p� m 0 W z1 qm - .t.' tt rt 2 =rai c v _ B d N -� _ 4111 CZ 1.111 VI 00 —m% V. I � 1 , , a ie" ffili ON N y V1 a W; H 0a a ai C Pg e. ; C h N d N E�� , 04 . t '1441114 2s o W j g m O n P A 7 ,a ru N N " � 00 �� C J4.1 00 �� — w rn Pc' `.g _ w C/3 n e z. 2 y > N N � tta w P j N V 00 M r,-, M . 7 Russell Investments MANAGER 4525 - - INVOICE NO. 1312074706 -9997 NW 6327 DATE 2014/01/30 PO BOX 1450 PAGE 1 OF 1 Minneapolis, MN 55485 -6327 US TOTAL CHARGES CURRENT PERIOD USD 976.93 9BYM - Police Officer Retirement Trust Police Officer Retirement Trust FOR 3 MONTH PERIOD 10/01/13 to 12/31/13 City of Boynton Beach DB Boynton Police & Fire Pension Fnds, 1500 Gateway B1vd,Suite #220Account ID: BOYNTON POLICE Pension Administrator Pay Type 3 Boynton Beach, FL 33426 ATTENTION Barbara L. Ladue PLEASE DETACH THIS PORTION AND RETURN WITH YOUR PAYMENT CHARGES BENEFIT PAYMENT CHECK FEES ACH Benefit Payments 400 AT 1.25 500.00 Benefit Payments 14 AT 1.25 17.50 Lump Sum Payments 5 AT 10.00 50.00 BENEFIT PAYMENT: OTHER FEES Federal Tax Refunds 1 AT 15.00 15.00 Pensioners Added 1 AT 0.50 0.50 State Tax Filing 6 AT 25.00 150.00 ** SUBTOTAL FEES ** 733.00 OUT OF POCKET CHARGES POSTAGE Advice of Deposit 213.84 Benefit Payment 7.56 Lump Sum 2.70 UPS DELIVERY UPS Charges 09/26/2013 6.58 UPS Charges 10/28/2013 0.74 UPS Charges 10/28/2013 5.90 UPS Charges 11/26/2013 0.71 UPS Charges 11/26/2013 5.90 19.83 ** SUBTOTAL OUT OF POCKET ** 243.93 CURRENT CHARGES USD 976.93 INV.# 1312074706 -9997 9BYM - Police Officer Retirement Trust 2014/01/30 12B1 /Float Disclosure Unless you have negotiated a higher per check charge in exchange for your plan's retention of float, Russell's paying agent, State Street Bank will receive float income on uninvested cash as part of its compensation for services provided to the Plan. The amounts generally earn the rates available on money market instruments. Circumstances where float income will be received on uninvested cash include: Russell's paying agent, State Street Bank will receive float income with respect to the processing of withdrawals, distributions and loans. Float is received from the time a withdrawal, distribution or loan check is processed until the check is cashed, or, with respect to uncashed checks, the date the underlying amounts are returned to the Trust. Checks are typically mailed a few days before funds are debited from the trust account, which is typically the business day following the date the transaction was effected in the participant's account. To limit the period of float on uncashed checks, at least once a year, uncashed checks are cancelled and the underlying amounts are returned to your trust. Additional background regarding check processing is available upon request, and is also contained with the business process flows accompanying the administrative services agreement. Deviations from these timelines are possible in Tight of administrative impracticability. Additional information is available to you upon request. X0185 rev 03/08 THE LAW OFFICES OF PERRY & JENSEN, LLC ANN H. PERRY BONNI SPATARA JENSEN apeny@perryjensenlaw.com bsjensen @penyjensenlaw.com January 24, 2014 Via Email Boynton Beach Police Officers' Pension Fund Toby Athol 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 Re: Legal Services Provided Invoice #72192 Dear Toby: Enclosed please find the Firm's invoice for services rendered for the period that ended 1115/2014. Your current balance due is $5,185.54. If Yq ou have any questions, please do not hesitate to contact me. gig:4 Y Sincerely yours, „.______Thi ( - )cv4-i9--------___ Bonni S. Jensen BSJ/Ig Enclosure Copy to: Barbara LaDue Via Email Only 400 EXECUTIVE CENTER DRIVE, SUITE 207•:• WEST PALM BEACH, FLORIDA 33401 -2922 PH: 561.686.6550 4. Fx: 561.686.2802 THE LAW OFFICES OF PERRY & JENSEN, LLC 400 Executive Center Drive Suite 207 West Palm Beach, FL 33401 -2922 Invoice submitted to: Boynton Beach Police Officers' Pension Fund Attn: Chairman 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 Copy to: Barbara LaDue - Via Email January 24, 2014 In Reference To: FOR PROFESSIONAL SERVICES RENDERED AS FOLLOWS: Client / File No.: 0188 Invoice #72192 Professional Services Hrs/Rate Amount Auditor's Inquiry Letter Auditor's Inquiry Letter 12/23/2013 BSJ Draft Auditor's Inquiry Letter 0.75 168.75 Review Email 225.00/hr Auditor's Inquiry Letter Auditor's Inquiry Letter 1/3/2014 LG E -Mail to Jeanine Bittinger re: Original Response to the Auditor's Inquiry 0.10 7.50 Letter 75.00/hr Auditor's Inquiry Letter Auditor's Inquiry Letter 1/6/2014 BSJ Correspondence with Richard Cristini re: Response to Auditor's Inquiry 0.50 112.50 Letter 225.00/hr Auditor's Inquiry Letter Auditor's Inquiry Letter LG E -mail to Jeanine Bittinger, Richard Cristini, Barbara LaDue, Chairman, & 0.20 15.00 Secretary re: Response to Auditor's Inquiry Letter 75.00 /hr Auditor's Inquiry Letter Auditor's Inquiry Letter 1/7/2014 LG Review & Respond to email from Richard Cristini re: Original Response 0.30 22.50 to Auditor's Inquiry Letter 75.00/hr Boynton Beach Police Officers' Pension Fund Page 2 Hrs/Rate Amount Mail to Richard Cristini the Response Letter Auditor's Inquiry Letter SUBTOTAL: [ 1.85 326.25] Inv Mqr - Frank Russell Inv Mgr - Frank Russell 1/6/2014 BSJ Review email re: Municipal Securities & Investments from Russell 0.35 78.75 Telephone call with Peter Delyanis 225.00/hr E -mail to Toby Athol re: No Investigation Required Inv Mgr - Frank Russell SUBTOTAL: [ 0.35 78.75] Miscellaneous Matters Miscellaneous Matters 12/18/2013 BSJ Correspondence with Trustees re: Memorandum on New 2014 Mileage 0.06 13.50 Rate 225.00/hr Miscellaneous Matters Miscellaneous Matters PH E -mail to Trustees re: Memorandum on New 2014 Mileage Rate 0.15 11.25 Miscellaneous Matters 75.00 /hr SUBTOTAL: [ 0.21 24.75] Participant - Epstein Participant - Epstein 12/20/2013 BSJ Correspondence with Robert Epstein re: Notice of Final Order (follow up) 0.50 112.50 Participant - Epstein 225.00/hr Participant - Epstein PH E -mail to Trustees & Administrator re: Epstein's Notice of Final Order 0.35 26.25 (follow up letter) 75.00 /hr E -mail to Paul Kelley Mail via US Mail & Certified Mail to Robert Epstein Participant - Epstein Boynton Beach Police Officers' Pension Fund Page 3 Hrs /Rate Amount Participant - Epstein 12/23/2013 BSJ Research Filing 0.25 56.25 Participant - Epstein 225.00/hr Participant - Epstein 1/2/2014 BSJ Review Notice of Appeal 1.00 225.00 Telephone call with Toby Athol re: Appeal 225.00/hr Research FRAP re: Filing of Index & Record; Initial Brief & Compilation of Time Participant - Epstein Participant - Epstein 1/6/2014 BSJ E -mail to Barbara LaDue re: Insurance Notification 0.25 56.25 Review & Respond to email from Barbara LaDue re: Insurance 225.00/hr Declaration Page Participant - Epstein Participant - Epstein 1/8/2014 BSJ Draft Notice of Claim 0.50 112.50 Participant - Epstein 225.00/hr Participant - Epstein 1/10/2014 PH Revise Notice of Claim Letter to Wilson, Elser, Markowitz, Edelman & 0.50 37.50 Dicker, LLP per Bonni's mark up 75.00 /hr E -mail to Toby Athol, Jason Llopis & Barbara LaDue re: Notice of Claim Letter Ship via UPS to Claims Manager at Wilson, Elser Participant - Epstein Participant - Epstein 1/15/2014 LG Telephone call with Yomayra Estefany at Wilson Elser's Office re: Who to 0.35 26.25 Direct the Notice of Claim to 75.00 /hr E -mail to Yomayra Estefany the requested Corporate Fiduciary Liability Insurance Policy Participant - Epstein Participant - Epstein BSJ Review Situation with Notice of Claim 0.25 56.25 Review Policy & Declaration's Page 225.00/hr Participant - Epstein SUBTOTAL: [ 3.95 708.75] Boynton Beach Police Officers' Pension Fund Page 4 Hours Amount For professional services rendered 6.36 $1,138.50 Additional Charges : Bill File 1/15/2014 Postage 7.37 Westlaw Research 25.00 Dates - December 1 - 31, 2013 SUBTOTAL: [ 32.37] Total additional charges $32.37 Amount For professional services rendered 6.36 $1,170.87 Total amount of this bill $1,170.87 Previous balance $4,014.67 Balance due o $5,185.54 O lor THE LAW OFFICES OF PERRY &JENSEN, LLC ANN H. PERRY BONNI SPATARA JENSEN aperry@perryjensenlaw.com bsjensen @peryjensenlaw.com December 19, 2013 Via Email Boynton Beach Police Officers' Pension Fund Toby Athol 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 Re: Legal Services Provided Invoice #72117 Dear Toby: Enclosed please find the Firm's invoice for services rendered for the period that ended 12/15/2013. Thank you for your payment of $6,266.96. Your current balance due is $4,014.67.17 If you have any questions, please do not hesitate to contact me. Sincerely yours, --75)\.",-,----)Z,' s'N...-----N„.........._ Bonni S. Jensen BSJ /Ig Enclosure Copy to: Barbara LaDue Via Email Only 400 EXECUTIVE CENTER DRIVE, SUITE 207❖ WEST PALM BEACH, FLORIDA 33401 -2922 PH: 561.686.6550 ❖ Fx: 561.686.2802 O - THE LAW OFFICES OF PERRY & JENSEN, LLC 400 Executive Center Drive Suite 207 West Palm Beach, FL 33401 -2922 Invoice submitted to: Boynton Beach Police Officers' Pension Fund Attn: Chairman 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 Copy to: Barbara LaDue - Via Email December 19, 2013 In Reference To: FOR PROFESSIONAL SERVICES RENDERED AS FOLLOWS: Client / File No.: 0188 Invoice #72117 Professional Services Hrs/Rate Amount Participant - Epstein Participant - Epstein 11/19/2013 BSJ Review Final Order 0.50 100.00 Review and revise Letter to Paul Kelley 200.00/hr Participant - Epstein Participant - Epstein 11/20/2013 BSJ Correspondence with Robert Epstein re: Final Order with Exhibits 0.50 100.00 Participant - Epstein 200.00 /hr Participant - Epstein PH E -mail to Barbara LaDue, Chairman, Secretary, & Paul Kelley re: Final 0.30 22.50 Order with Exhibits 75.00 /hr Mail via US Certified Mail Return Receipt Requested to Robert Epstein & Paul Kelley Participant - Epstein Participant - Epstein 12/4/2013 BSJ Draft Letter to Paul Kelley re: Epstein Copy of Order 0.50 100.00 Participant - Epstein 200.00 /hr Boynton Beach Police Officers' Pension Fund Page 2 Hrs /Rate Amount Participant - Epstein 12/4/2013 BSJ Correspondence with Paul Kelley re: Epstein's "Green Card" for Certified 0.50 100.00 Mail has not been received 200.00/hr Participant - Epstein Participant - Epstein PH E -mail to Paul Kelley, Barbara LaDue, Toby Athol, & Jason Llopis re: 0.30 22.50 Letter to Paul Kelley regarding Epstein's "Green Card" for Certified Mail 75.00 /hr has not been received Ship via UPS to Robert Epstein re: Resending Packet originally sent by Certified Mail on 11/20/13 Participant - Epstein Participant - Epstein PH Telephone call with Jupiter Post Office 0.25 18.75 Participant - Epstein 75.00 /hr SUBTOTAL: [ 2.85 463.75] State State 11/18/2013 PH E -mail to Julie Browning, Barbara LaDue, Toby Athol, Jason Llopis, Scott 0.30 22.50 Caudell, Joe Degiulio & John Huntington re: Letter in Response to Julie 75.00/hr Browning's Letter dated 7/24/13 with Exhibits State State BSJ Finalize Letter to Julie Browning 0.50 100.00 State 200.00/hr SUBTOTAL: [ 0.80 122.50] For professional services rendered 3.65 $586.25 Additional Charges : Bill File 12/15/2013 Postage 13.02 Copy Charges 15.75 Boynton Beach Police Officers' Pension Fund Page 3 Amount SUBTOTAL: [ 28.77] Participant - Epstein 12/4/2013 United Parcel Service Invoice No.: 0000F49280493 13.99 Tracking #1ZF49280A899711947 to Robert Epstein re: Final Order United Parcel Service Invoice No.: 0000F49280493 6.96 Tracking #1ZF49280A899711947 Pickup Request No.: 294BJ30L65B Re: Epstein Final Order SUBTOTAL: [ 20.95] Total additional charges $49.72 For professional services rendered 3.65 $635.97 Total amount of this bill $635.97 Previous balance $9,645.66 Accounts receivable transactions 12/6/2013 Payment - Thank You!. Check No. 053409 ($6,266.96) Total payments and adjustments ($6,266.96) Balance due filK:/ $4,014.67 THE LAW OFFICES OF PERRY & JENSEN, LLC ANN H. PERRY BONNI SPATARA JENSEN apex y @per yjensenlaw.com bsjensen @penyjensenlaw.com November 22, 2013 Via Email Boynton Beach Police Officers' Pension Fund Toby Athol 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 Re: Legal Services Provided Invoice #72076 Dear Toby: Enclosed please find the Firm's invoice for services render d for the period that ended 11/15/2013. Your current balance due is , . . 33 28 ?o If you have any questions, please do not hesitate to contact me. Sincerely yours, r 4 i Jf Bonni S. Jensen ' BSJ/Ig Enclosure Copy to: Barbara LaDue Via Email Only 400 EXECUTIVE CENTER DRIVE, SUITE 207:• WEST PALM BEACH, FLORIDA 33401 -2922 PH: 561.686.6550 • Fx: 561.686.2802 ' m THE LAW OFFICES OF PERRY & JENSEN, LLC 400 Executive Center Drive Suite 207 West Palm Beach, FL 33401 -2922 Invoice submitted to: Boynton Beach Police Officers' Pension Fund Attn: Chairman 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 Copy to: Barbara LaDue - Via Email November 22, 2013 In Reference To: FOR PROFESSIONAL SERVICES RENDERED AS FOLLOWS: Client / File No.: 0188 Invoice #72076 Professional Services Hrs /Rate Amount Attendance at Trustee Meetings Attendance at Trustee Meetings 11/12/2013 BSJ Attend Meeting 2.50 500.00 Attendance at Trustee Meetings 200.00 /hr Attendance at Trustee Meetings 11/13/2013 LG Review Post Meeting Folder 0.30 22.50 Attendance at Trustee Meetings 75.00/hr SUBTOTAL: [ 2.80 522.50j Attorney Engagement Agreement Attorney Engagement Agreement 10/29/2013 BSJ Correspondence with Board of Trustees & Administrator re: Fee 0.50 NO CHARGE Increase 200.00 /hr Attorney Engagement Agreement Attorney Engagement Agreement LG E -mail to Board of Trustees & Administrator re: Fee Increase Letter & 0.10 NO CHARGE Fee Schedule Comparison 75.00 /hr Attorney Engagement Agreement Boynton Beach Police Officers' Pension Fund Page 2 Hrs /Rate Amount Attorney Engagement Agreement 11/7/2013 LG Revise Agreement & Fee Schedule per Bonni's mark up 0.50 NO CHARGE Attomey Engagement Agreement 75.00 /hr Attorney Engagement Agreement 11/13/2013 LG E -mail to Barbara LaDue re: Original Executed Addendum to Legal 0.10 NO CHARGE Services Agreement 75.00 /hr Attorney Engagement Agreement SUBTOTAL: [ 1.20 0.00] Forms Forms 10/23/2013 PH Revise HIPAA Form to Include Workers Compensation Records & 0.40 30.00 Expire at End of Disability Case 75.00 /hr E -mail to Administrator re: New HIPAA Form Forms SUBTOTAL: [ 0.40 30.00] Meeting Notices and Agendas Meeting Notices and Agendas 11/7/2013 PH Prepare Attorney Report, Handouts, and Notebook for upcoming 1.50 112.50 Meeting - 11/12/13 75.00 /hr Meeting Notices and Agendas SUBTOTAL: [ 1.50 112.50] Participant - Epstein Participant - Epstein 10/23/2013 BSJ Research Final Order 1.00 200.00 Participant - Epstein 200.00 /hr Participant - Epstein 10/24/2013 BSJ Draft Final Order 2.00 400.00 Participant - Epstein 200.00 /hr Boynton Beach Police Officers' Pension Fund Page 3 Hrs /Rate Amount Participant - Epstein 10/25/2013 BSJ Review and revise Final Order 3.00 600.00 Participant - Epstein 200.00 /hr Participant - Epstein 10/28/2013 BSJ Review and revise Order 1.00 200.00 Participant - Epstein 200.00 /hr Participant - Epstein 10/30/2013 BSJ Review & Respond to email from Barbara LaDue re: Hearing Not 0.15 30.00 Happening - Final Order to be Entered 200.00 /hr Participant - Epstein Participant - Epstein BSJ E -mails to Paul Kelley 0.50 100.00 Telephone call with Toby Athol 200.00 /hr E -mail to Barbara LaDue Participant - Epstein Participant - Epstein 11/5/2013 BSJ Review and revise Order 0.35 70.00 E -mail to Paul Kelley re: Agenda 200.00 /hr Participant - Epstein SUBTOTAL: [ 8.00 1,600.00] Participant - Kenny Participant - Kenny 10/28/2013 BSJ Review email from Tammy Stanzione re: Workers Compensation 0.25 50.00 Documents 200.00 /hr E -mail to Barbara LaDue re: Status Participant - Kenny Participant - Kenny 10/31/2013 BSJ Review Withdrawal of Application 0.25 50.00 E -mail to Tammy Stanzione 200.00 /hr Participant - Kenny Boynton Beach Police Officers' Pension Fund Page 4 Hrs /Rate Amount Participant - Kenny 11/6/2013 BSJ Review Letter from Paul Kelley re: Withdrawal of Kenny Application 0.25 50.00 Participant - Kenny 200.00 /hr SUBTOTAL: [ 0.75 150.00] Participant - Swain Participant - Swain 10/29/2013 BSJ Review email from Barbara LaDue re: Supplemental Benefit Due 0.50 100.00 Research Plan Document re: Benefit Payable 200.00/hr Participant - Swain Participant - Swain 11/4/2013 BSJ Review & Respond to email from Barbara LaDue 0.50 100.00 Review Plan Document 200.00 /hr Participant - Swain SUBTOTAL: [ 1.00 200.00] State State 11/4/2013 BSJ Draft Response Letter to State 1.00 200.00 E -mail to Barbara LaDue re: Annual Report page 6A 200.00 /hr Review Actuarial Valuation State State 11/5/2013 BSJ Draft Response Letter to State 2.00 400.00 Review Audit 200.00 /hr Review Plan Document Research State Statutes Prepare Exhibits State State 11/7/2013 PH E -mail to Toby Athol, Scott Caudell, Jason Llopis, John Huntington, 0.50 37.50 Joe DeGiulio, & Barbara LaDue re: Draft Letter to Julie Browning with 75.00 /hr the Bureau of Local Retirement Systems for Discussion at the Next Meeting State Boynton Beach Police Officers' Pension Fund Page 5 Hrs/Rate Amount SUBTOTAL: [ 3.50 637.50] Trustee Information • Trustee Information 11/14/2013 BSJ E -mail to Scott Caudell re: Voting Conflict 0.25 50.00 Trustee Information 200.00/hr Trustee Information BSJ Research Commission on Ethics Website 0.10 20.00 Trustee Information 200.00 /hr SUBTOTAL: [ 0.35 70.00] For professional services rendered 19.50 $3,322.50 Additional Charges : Bill File 11/15/2013 Westlaw Research 25.00 Dates - October 1 - 31, 2013 Copy Charges 31.20 SUBTOTAL: [ 56.20] Total additional charges $56.20 For professional services rendered 19.50 $3,378.70 Total amount of this bill ``° $3,378.70 Previous balance nn `n / „ �j 166796 4 „. DS- ,4 Balance due BURGESS CHAMBERS & ASSOCIATES, INC. Invoice INVESTMENT ADVISORS S.E.C. REGISTERED 315 E. Robinson Street, Suite 690 Date Invoice # Orlando, Florida 32801 12/3/2013 13 -314 Bill To Boynton Beach Police Officers' Pension Barbara La Due, Administrator 1500 Gateway Blvd, Suite 220 Boynton Beach, Florida 33426 Descnption Amount Fourth Quarter 2013 Investment and Performance Monitoring and Advisory Fee per Contract 5,000.00 We appreciate your prompt payment. Total $5,000.00 Phone # Fax # (407) 644-0111 (407) 644-0694 R C Gabriel Roeder Smith & Company Consultants & Actuaries One East Broward Blvd. Suite 505 Invoice Ft. Lauderdale, Florida 33301 -1872 (954) 527 -1616 Date Invoice 12/12/2013 404553 Bill To: Please Remit To: Attention: Ms. Barbara La Due Dept. # 78009 City of Boynton Beach Gabriel Roeder Smith & Company Boynton Beach Municipal Police Officers Retirement Fund PO Box 78000 Renaissance Executive Suites Detroit, Michigan 48278 -0009 1500 Gateway Blvd., Suite 220 Boynton Beach, Honda 33426 Federal Tax ID 38- 1691268 Client 100550 Amount For services rendered for the Boynton Beach Municipal Police Officers Retirement Fund through 11/30/2013 Charges since 9/30/2013 for preparation of the 10/1/2013 Actuarial Valuation Report; 1,596.00 total charges to date equal $2,071 Amount Due $1,596 PLEASE INDICATE THE INVOICE NUMBER ON YOUR REMITTANCE. THANK YOU. Page 1 of 1 G IS Gabriel Roeder Smith & Company Consultants & Actuanes One East Broward Blvd. Suite 505 Invoice Ft. Lauderdale, Florida 33301 -1872 (954) 527 -1616 Date Invoice 1/8/2014 404949 Bill To: Please Remit To: Attention: Ms. Barbara La Due Dept. # 78009 City of Boynton Beach Gabriel Roeder Smith & Company Boynton Beach Municipal Police Officers Retirement Fund PO Box 78000 Renaissance Executive Suites Detroit, Michigan 48278 -0009 1500 Gateway Blvd., Suite 220 Boynton Beach, Florida 33426 Federal Tax ID 38- 1691268 Client 100550 Amount For services rendered for the Boynton Beach Municipal Police Officers Retirement Fund through 12/31/2013 Charges since 11/30/2013 for preparation of the 10/1/2013 Actuarial Valuation Report; 2,392.00 total charges to date equal $4,463 Service Purchase calculation for Webster 450.00 Amount Due $2,842 PLEASE INDICATE THE INVOICE NUMBER ON YOUR REMITTANCE. THANK YOU. Page 1 of 1 Davidson, Jamieson & Cristini, P.L. Invoice 1956 Bayshore Blvd. Date Invoice # Dunedin, Fl 34698 Phone # 727 - 734 -5437 12/16/2013 R7122 Fax # 727- 733 -3487 Bill To CITY OF BOYNTON BEACH POLICE PENSION PLAN 1500 Gateway Blvd. Suite 220 Boynton Beach, Florida 33426 Description Amount Audit of Financial Statements for the year ended September 30, 2013 Progress billing 5,500.00 Total $5,500.00 Payments /Credits $0.00 Balance Due $5,500.00 Terms Invoices are due and payable upon receipt Any amounts remaining unpaid after 30 days will be assessed a Service Charge equal to 1% per month (12% per annum) Minimum monthly service charge is $5 00 Davidson, Jamieson & Cristini, P.L. Invoice 1956 Bayshore Blvd. Date Invoice# Dunedin, Fl 34698 Phone # 727- 734 -5437 1/23/2014 R7135 Fax # 727 - 733 -3487 Bill To CITY OF BOYNTON BEACH POLICE PENSION PLAN 1500 Gateway Blvd. Suite 220 Boynton Beach, Florida 33426 Description Amount Audit of Financial Statements for the year ended September 30, 2013 Final billing 9,800.00 Less amount previously billed -5,500.00 Total $4,300.00 Payments /Credits $0.00 Balance Due $4,300.00 Terms Invoices are due and payable upon receipt. Any amounts remaining unpaid after 30 days will be assessed a Service Charge equal to 1% per month (12% per annum) Minimum monthly service charge is $5 00 PROFESSIONAL INDEMNITY AGENCY, INC. 37 RADIO CIRCLE DRIVE MOUNT KISCO, NY 10549 TO: CITY OF BOYNTON BEACH POLICE OFFICERS' RETIREMENT FUND RE: U. S. SPECIALTY INSURANCE COMPANY $2,000,000 LIMIT OF LIABILITY, $ -0- DEDUCTIBLE Renewal of Policy #U712 -50977 — 4/10/13 - 4/10/14 PREMIUM $11,130.00 WAIVER OF RECOURSE 125.00 FLORIDA CAT 1% SURCHARGE 146.32 $11,.401.32 Please make check payable to: PROFESSIONAL INDEMNITY AGENCY, INC. and mail to: TRUSTEE AND FIDUCIARY INSURANCE SERVICES, INC. 3810 Inverrary Boulevard, Suite 303 Lauderhill, FL 33319 THANK YOU. T 1n -1 zm V1 H cm° M 3 r M - J. 3 m-+•a OC1ln01WWh- kwOwLog.n .WMOMONV rs3mtnuolvvi p0000NOM4N3m - 1&-- - V0 OC100NHHWHVN00C1000 ANViNAV7N001-- ivivr. r wz ,< 10000V010VNV -a0. 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