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Agenda 02-09-16 BOYNTON BEACH POLICE OFFICERS’ PENSION FUND QUARTERLY BOARD MEETING Tuesday, February 9, 2016 @ 10:30 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 – APPROVAL OF MINUTES – III.Quarterly Meeting 11-10-2015 IV. FINANCIAL REPORTS: A)Quarterly & PYE Investment Review –12-31-2015 1) Russell Investment Group – MJ (Candioto) Serene, CFA a) – Investment Review 2.) Burgess Chambers & Associates - Head of Research Frank Wan a) Fund Performance review – 3) Gabriel Roeder Smith & CO – Pete Strong- Sr Consultant & Actuary a) Updated GASB No. 67 Disclosure Information b) Actuarial Valuation for 10-01-2015 4) Davidson, Jamieson & Cristini – Richard Cristini, CPA & Jeanine Bittinger, CPA a) Audit Report & Financial Statements for PYE 9-30-2015 V.CORRESPONDENCE: 1) State Acceptance – All Reports through 10-01-2014 – ltr dated 11-17-15 2) Death Check/Mortality ID Services – Russell/Berwyn Gp – 11-27-15 VI. OLD BUSINESS: N/A VII. NEW BUSINESS: A. Invoices for review and approval: 1.Russell Investment Gp. – Quarter End 12-31-2015 - $136,121 2.Russell Payment Services – Quarter End 12-31-2015 - $1,091.18 3.Klausner, Kaufman, Jensen & Levinson – Service Nov & Dec - $2,587.50 1 th 4.Burgess Chambers & Assoc – 4 Qtr 2015 fee - $6,250 5.Gabriel, Roeder, Smith & Co- Service Dec 2015 - $1,942 6.Davidson, Jamieson & Cristini – Progress Audit Billing - $6,000 B) Attorney Report - Bonni Jensen 1) Police & Fire Pension Board – RFP for Pension Administrator – Joint venture meeting for review process. 2) Insurance Premium Tax – Data Base – Chapter 175/185 memo 12-5-15 3) Robert Kellman LOD Disability Benefit Application & Interrogatories App VIII. PENSION ADMINISTRATOR’S REPORT 1.Benefits as of 02-02-2016 2.New Benefit Payment Program – PlusWeb (Conversion from NBX) – Evaluation Update - IX. PUBLIC AUDIENCE COMMENTS: (Limited to three (3) Minutes) X. ADJOURNMENT: Next Regular Meeting Date – Tuesday, May 10, 2016 @ 10:30 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 MINUTES OF THE BOYNTON BEACH POLICE OFFICERS' PENSION FUND QUARTERLY BOARD MEETING HELD ON TUESDAY, NOVEMBER 10, 2015 AT 10:30 A.M., AT RENAISSANCE COMMONS EXECUTIVE SUITES 1500 GATEWAY BOULEVARD, SUITE NO. 220, BOYNTON BEACH, FLORIDA Present: Toby Athol, Chair Barbara LaDue, Pension Administrator Jason Llopis, Secretary Bonni Jensen, Board Counsel Scott Caudell Joe DeGiulio Absent: Russell Faine I. CALL TO ORDER — Toby Athol, Chair Chair Athol called the meeting to order at 10:39 a.m. It. AGENDA APPROVAL — I Ms. LaDue added VII B item 4, Firefighters' Joint RFP and Third Party Administrator and item D, change the February meeting date to accommodate the auditors. Motion Mr. Llopis moved to approve the agenda as amended. Mr. DeGiulio seconded the motion that unanimously passed. Chair Athol advised Russell Faine would not be present at the meeting. He had sustained a broken ankle attending a pension conference. III. APPROVAL OF MINUTES — Special Meeting 07 -21 -2015 Quarterly Meeting 08 -11 -2015 Motion Mr. DeGiulio moved to approve the minutes. Mr. Llopis seconded the motion that unanimously passed. IV. FINANCIAL REPORTS: A) Quarterly & PYE Investment Review — 09 -30 -2015 - Meeting Minutes Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 1) Russell Investment Group — MJ (Candioto) Serene, CFA a) LSEG agrees to proposed sale of Russell Investments • b) Investment Review MJ Serene, Certified Financial Analyst, announced in October, an agreement was reached between the London Stock Exchange Group (LSEG) and TA Associates, a private equity firm, regarding the sale of Russell Investments and the transaction will close the first half of 2016. A third player, Reverence Capital Partners will be a minority partner. Both LSEG and TA Associates are long -term investors that do not effect quick flips. They are interested in multi -asset investments and they have known Russell Investments for 20 years. Their first priority is ensuring clients are happy. They are still owned by LSEG, and they would not hear much. from TA Associates beyond general commitments to continue to do what Russell does for its clients. B. Investment Review. Ms. Serene advised the third quarter was a rough period for the markets and there were some declines. Russell Investments did not think this was the start of a bear market, • rather it was a retreat from market conditions from the first part of the year. At fiscal year -end, U.S. markets were down slightly and there were materially negative numbers in developed and emerging markets. There were slightly positive returns in the fixed income markets and negative commodity returns that were minus 26% over the year. The Plan was up 1.5 %, which was a respectable retum. From a calendar year -to -date perspective, the Plan was down -3 %. In October and early November, U.S. markets rebounded about 8% and Ms. Serene noted there were pullbacks. China impacted other emerging market economies, and to a lesser extent, more developed economies. China has the largest world population. From a global economy view, China is 60% of the size of the U.S. and it was a growing economy. They were looking at double -digit growth in the Gross Domestic Product (GDP), but it slowed 6% to 7 %. Compared to the developed world, growth was closer to 2% or 3 %. Despite those factors, China was not a big player in the stock market and only comprised about 3% of the world market cap. The Plan's exposure to China was not astronomical, but it was a good diversifier. Despite negative returns, year to -date over the last year, the returns were flat. Ms. Serene expected moderate growth and thought the Federal Reserve would make a change in December. Over the last three years, Europe was behind the U.S. from an economic perspective. They stopped quantitative easing. They stopped the bond buying program over a year ago and Europe was still in an easing mode. The GDP growth would be muted, but Ms. Serene anticipated greater potential from a stock 2 Meeting Minutes Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 market equity return perspective. Oil prices were low and there were many favorable things for Europe which had a key overweight in the portfolio and the multi -asset core fund. Russell Investments was looking at commodity producing economies such as Canada, New Zealand and Australia. The asset allocation summary showed the largest holding was 39% in the MAC fund, which is growth retum seeking diversified fund with 75% in global equities, 15% in listed real assets, and 10% in fixed income. The Russell Large Cap Defensive Equity Fund was a U.S. only defensive equity strategy. The biggest reason for the equity strategy was to ensure they did not cross over the foreign threshold. The portfolio started this fiscal year with $76.2 million. inflows netted to zero for the year. There was $1.8 million in investment gains, and the portfolio market value ended with just under $77.9 million. The real estate results would be issued later and Ms. Serene would email the records to the members. There was a slight adjustment due to positive real estate trust returns of 3 %. As of yesterday, the portfolio was at $84.5 million including the City's contribution. Mr. Llopis left the meeting at 10:58 a.m. Ms. Serene explained for the fiscal year, the numbers were adjusted by 20 basis points due to real estate. Net of all fees, the portfolio retumed 1.55 %. Mr. Llopis returned to the meeting at 10:59 a.m. This was 1% higher than the benchmark return. The defensive U.S. equity fund was in line with the benchmark, and it was a value add from an absolute point of view. U.S. large cap markets were down 7% and the Russell 1000 defensive fund was down 3.5 %. Similarly, the MAC product returned 1% above the benchmark for the third quarter, earning 4% for the fiscal year. The portfolio continues to be overweight in Europe and has a more optimistic view of the European market. Commodity exposures changed from an underweight exposure to a neutral exposure because the asset class was extremely negative. Russell Investments removed the commodity underweight, but still remained underweight to commodity producing country equities. They were also underweight in interest rate sensitive securities. Altemative investment returns in private real estate were 11.88 %. On a fiscal year -to -date basis, the return was 15.56 %. Ms. Serene noted private real estate typically Zags, and there will be an income component, but not as much interest appreciation. When the Federal Reserve approves a rate increase, this would not have an immediate impact because it is a private investment. Real Estate . Investment Trusts . (REITS) could be immediately impacted. Russell values real estate once a year, so it would take a while to reflect 3 • Meeting Minutes - Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 adjustments, but it is not subject to volatile market reactions. Attorney Jensen noted the manager manages the rates of return. Chair Athol inquired what changes were made that worked and did not. Frank Wan, Head of Research, BCA, responded they increased private real estate this year and it continues to do well. The managers are actively shifting inside the portfolio and currently the shift was towards Europe. Mr. Wan commented even though the fund was down 3% for the quarter, it was one of the best performing funds in the country. 2) Burgess Chambers & Associates - Head of Research Frank Wan a) Fund Performance review — Mr. Wan commented on the state of the pension system. He reviewed all pension plans from the 50s into the 80s. Most plans invested between 85% and 100% in bonds because they could fairly certainly receive an 8% retum, but as bond yields decreased, the difference in the return had to come from stocks. Over the last 30 years, risk increased. Mr. Wan explained they cannot avoid market risk, but it could be defined as beta risk. Mr. Wan reviewed beta in the different asset classes over the past 10 years. If more risk was wanted, they should invest in mid to small cap stocks, but in the Ion Y P � 9 run, the risk should be rewarded. Russell Investments made recommendations to invest in other asset classes such as REITS, commodities, private real estate and infrastructure, which in the aggregate, should lower the risk of the fund. He noted the product achieved that goal. Despite having a large exposure to internationals for the past few years, although the MAC product was down, it did well compared to its peer group and it had a lower beta. Mr. Wan credited the fixed income managers at Russell Investments because the way the portfolio was positioned was rewarded. All the alpha risk in the portfolio came from private real estate. Real estate for the past year was up 15.6% and the Board added more to it before the market correction. They have an 8% exposure there and it kept increasing. Real estate was a significant value add. Overall, the portfolio was doing well. Mr. Wan had suggested postponing the discussion about the Russell Absolute Retum product. When they contemplated the product, they were looking for bond alternatives. Mr. Wan noted, given the uncertainty in the market, they should be more aware of equity risks because the risk premium in owning equities did not justify the investment. There was also uncertainty about global stocks and many global issues have not subsided. There is uncertainty about rates and no one was projecting inflation. He thought having a low defensive position, some diversification and real estate has been good for the portfolio. The fixed income exposure was fine and they should continue to monitor risk within the equity portion of the multi- manager assets. 4 Meeting Minutes Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 Mr. Wan explained they have to take some risk. Hedge funds did not work out for the last six years. He noted larger pension plans were graduating towards hedge funds, but after the fees, they were not producing the results they should. The absolute return was like a hedge fund, but he suggested using real estate. Real estate has a 93% occupancy rate and a net operating growth of over 9 %. He thought they should take direction from the Federal Reserve and from other central governments. There are 28 large central banks in the world that were lowering their rates and Mr. Wan thought the fund was well positioned. The Plan ranked well since the recovery. Mr. Wan announced his firm was migrating to a new system and the Trustees would see a different visual report. They collected information from more pension funds and would have over 650 peers in their universe from throughout the country. Chair Athol asked if they could compare the funds based on size and learned they could. Currently with Florida's regulations compared to other plans, they were in -line with small or large plans. V. CORRESPONDENCE 1) GRS — Authorization from the Board to work with City to comply with new GASB 68 disclosure. Motion Mr. DeGiulio moved to send authorization to the City to comply with the GASB 68 disclosure. Mr. Llopis seconded the motion that unanimously passed. Ms. LaDue will send the letter. VI. OLD BUSINESS: N/A VII. NEW BUSINESS: A. Invoices for review and approval: 1. Russell Investment Gp. — Quarter End 09 -30 -2015 - $131,372 2. Russell Payment Services - Quarter End 09 -30 -2015 - $1,004.99 3. Attorney Jensen PA — Service Aug, Sep & Oct. 2015 - $5,253.22 4. Burgess Chambers & Assoc — 3rd Qtr 2015 fee - $6,250 5. Gabriel, Roeder, Smith & Co- Service thru Aug 2015 - .$7,192 Motion Mr. Caudell moved to pay the bills. Mr. DeGiulio seconded the motion that unanimously, passed. B) Attorney Report'- Bonni Jensen 1) Relocation Notice 5 Meeting Minutes Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 Attorney Jensen announced she relocated to the Plantation office and had a different telephone number which she gave to the members. 2) NCPERS Code of Conduct Attorney Jensen advised the National Conference of Public Employee Retirement Systems (NCPERS) put together a Code of Conduct to be aware of when hiring and working with service providers. The Code reminds the Trustees of their fiduciary responsibilities. It asks for a level of transparency regarding fees and when making decisions about service providers. Some providers were actively supporting defined benefit plans as opposed to those whom were actively looking to diminish defined benefit plans in the public sector. NCPERS promulgated a list of groups who were actively trying to eliminate defined benefit plans in the public sector and wanted the Trustees to adopt the policy. Attorney Jensen did not have any clients that had done so, and advised the purpose of the item was for the Trustees to be cognizant of the fact that there are individuals seeking to eliminate defined benefit plans. Ms. LaDue asked why the Leroy. Collins Institute or the Florida League of Cities was not on the list. Attorney Jensen responded the list was created on a national level. 3) Determination of Supplemental Benefit — Letter of 10 -14 -2015 Attomey Jensen sent a letter to the State asking if they were a supplemental plan in accordance with Florida Statutes. She believed at the November Division of Retirement Conference there would be a presentation on the topic and they would discuss these and other questions regarding Senate Bill 172. Attomey Jensen would not be able to attend the conference, and Attomey Adam Levinson would try to attend. The conference would be held in Orlando from November 17 to the 19 Chair Athol advised they will try to send someone for the Wednesday conference when supplemental plans would be addressed. Attomey Jensen attempted to get the Division of Retirement Director to hold a webinar, and believed the Director would speak at 1 p.m. on Wednesday, November 18, 2015 on this subject. 4) Police & Fire Pension Board — RFP for Pension Administrator — Joint venture set up and review process. Attorney Jensen noted the Trustees have a copy of the RFP the Firefighters put together based loosely on what the Police did. They have a joint request. The firefighters also wanted to target third -party administrators; however, Attorney Jensen did not think the RFP excluded them. Currently, the monthly office bill is split which includes the rent, copies, connections, phone and the salary. Ms. LaDue commented not all the firefighters want a third -party administrator. 6 • Meeting Minutes Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 Attorney Jensen, thought the RFP should solicit both and Chair Athol agreed. They could issue the RFP together and provide information separately. The joint request was updated per discussions from the last meeting. Ms. LaDue reviewed it and added Item 3. Currently, the City provided the meeting minutes, but the Administrator should be able to handle that task if needed. The Firefighters wanted to have a review meeting in March and hire someone during the summer. The RFP should be issued by the first of the year and could be sent to individuals interested in the position. Advertisements in national publications would be expensive. Mr. Wan recommended Florida BIZ.net and the FPPTA and suggested Attorney Jensen compile a list of all the administrators her office works with. Chair Athol wanted someone familiar with pension regulations from Florida. Attorney Jensen agreed to issue the RFP after the first of the year. Attorney Jensen commented at the last meeting, they had discussed the IRS determination letter process. They did not have to make any changes to the DROP plans. She just received a response from the IRS for St. Lucie County and they filed two years ago. If they filed the Determination letter, they would need an amendment describing how the DROP plan interest is calculated. After discussion, the members thought they should not send it in. Motion Mr. Llopis moved to not go forward with the IRS Determination letter. Mr. Caudell seconded the motion that unanimously passed. C) Alive & Well Statements — Institute $100 administration fee for late retum of Statement Each year the Alive and Well Statements are sent to retirees in June to sign and return. If received Ms. LaDue continues to make payments. If no response is received in June, another letter is sent in September. There are retirees that do not respond back in time and the administrator has to spend a lot of time trying to make contact with them Chair Athol thought instituting a $100 administrative fee for late statements to cover the time spent to track down these individuals was appropriate. Whatever the cutoff date was, the proposal was if the response does not arrive on time, they would send a check when it is received less the $100. Attorney Jensen explained that the statute allows the Board to collect fines. Chair Athol requested Attorney Jensen see if they could institute some type of an administrative fee and she agreed. D. Change February Meeting Date. Ms. LaDue wanted to change the February 9 meeting date and explained the auditors always make a presentation in February for the plan year ending the previous September. The Firefighters could not change their February Board meeting on February 3 She asked if the Board would change their meeting date so the auditors 7 Meeting Minutes Police Officers Pension Fund Boynton Beach, Florida November 10, 2015 would not have to make two trips. Chair Athol noted Trustee School was occurring then, and there was agreement to keep the meeting date the status quo. VIII. PENSION ADMINISTRATOR'S REPORT 1. Benefits as of PYE 9 -30 -2015 Ms. LaDue reviewed the payments. There were no comments on this item 2. Pension Administrator — Review for 5% raise effective 10 -01 -2015 ($119.85 a month) Ms. LaDue explained the Firefighters increased her salary 5% and she inquired if the Police would do the same. The amount shown was just the Police portion. The last time she received a raise was last October. Motion Mr. Caudell moved to approve the 5% raise. Mr. Llopis seconded the motion that unanimously passed. IX. PUBLIC AUDIENCE COMMENTS: (Limited to three (3) Minutes) None. X. ADJOURNMENT: There being no further business to discuss, Chair Athol properly adjoumed the meeting at 12:08 p.m. i Catherine Cherry Minutes Specialist 113015 8 1 1 1 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND FINANCIAL STATEMENTS September 30, 2015 and 2014 1 1 1 1 1 1 DAVIDSON, JAMIESON & CRISTINI, P.L. 1 Certified Public Accountants 1 1 1 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND 1 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 1 REOUIRED SUPPLEMENTAL INFORMATION 1 SCHEDULE OF CHANGES IN THE CITY'S NET PENSION LIABILITY AND RELATED RATIOS 25 1 - SCHEDULE OF CONTRIBUTIONS 26 I NOTES TO THE SCHEDULE OF CONTRIBUTIONS 27 ADDITIONAL INFORMATION I SCHEDULES OF INVESTMENT AND ADMINISTRATIVE EXPENSES 28 1 1 1 1 1 1 1 1 Davidson, Jamieson & Cristini, P.L. I Certified Public Accountants 1956 Bayshore Boulevard Dunedin, Florida 34698 -2503 (727)734 -5437 or 736 -0771 I FAX (727) 733 -3487 Member Members of the Firm American Institute of John N. Davidson, CPA, CVA Certified Public Accountants I Harry B. Jamieson, CPA Florida Institute of Richard A. Cristini, CPA, CPPT, CGFM Certified Public Accountants Jeanine L. Bittinger, CPA, CPPT The Board of Trustees Boynton Beach Police Officers' I Pension Fund Boynton Beach, Florida I INDEPENDENT AUDITOR'S REPORT Report on Financial Statements 1 We have audited the accompanying financial statements of the Boynton Beach Police Officers' Pension Fund (Plan), which comprise the statements of fiduciary net position as of I September 30, 2015 and 2014, and the related statements of changes in fiduciary net position for the years then ended, and the related notes to the fmancial statements. Management's Responsibility for the Financial Statements I The Plan's Board of Trustees is responsible for the preparation and fair presentation of these P P P P financial statements in accordance with accounting principles generally accepted in the United I 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. I Auditor's Responsibility I 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 I 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 I Plan's preparation and fair presentation of the fmancial 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 I 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. 1 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. I 1 1 1 The Board of Trustees I Boynton Beach Police Officers' Pension Fund Boynton Beach, Florida 1 1 Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the I fiduciary net position of the Boynton Beach Police Officers' Pension Fund as of September 30, 2015 and 2014, and the changes in fiduciary net position for the years then ended in accordance with accounting principles generally accepted in the United States of America. I Other Matters I 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 25 through 27 of the I Boynton Beach Police Officers' Pension Fund is required by Governmental Accounting Standards Board Statement No. 67 and is not a required part of the basic financial statements. The additional information on page 28 is presented for purposes of additional analysis and is also not a required 1 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 I other records used to prepare the basic fmancial 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 1 all material respects, in relation to the basic fmancial statements as a whole. Other Information 1 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 I 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 I affected by this missing information. D a4444 4 07 . 7 - ), A 4471;464> ' a et. 1 January 16, 2016 1 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND 1 STATEMENTS OF FIDUCIARY NET POSITION September 30, 2015 and 2014 1 Assets 1 2015 2014 1 Cash $ 8,692 $ 25,518 Receivables: I DROP loans 299,439 238,163 Broker - dealers 395,310 370,379 1 Total receivables 694,749 608,542 1 Investments at fair value: Multi manager bond investment fund 21,709,238 22,669,808 1 Multi asset core investment fund 29,668,247 29,300,544 Large capital defensive equity investment fund 20,005,118 19,631,376 1 Real estate investment fund 6,259,818 4,181,355 Total investments 77,642,421 75,783,083 1 Prepaid expenses 8,650 10,046 1 Total assets 7 8 354 512 76,427,189 ota ass s 1 Liabilities 1 Accounts payable 144,804 145,124 Total liabilities 144,804 145,124 I Net P osition restricted for pensions $ 78,209,708 $76,282,065 P 1 I 1 See Notes to Financial Statements. 1 3 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND I STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION Years ended September 30, 2015 and 2014 I Additions: 2015 2014 Contributions: I Employer $ 4,365,259 $ 4,159,736 Plan members 924,289 885,669 Plan members, buy -back 116,586 25,706 Rollover to DROP 78,814 28,186 1 Total contributions 5,484,948 5,099,297 I Intergovernmental revenue: Chapter 185 state excise tax rebate. 675,227 645,579 Total intergovernmental revenue 675,227 645,579 1 Investment income (loss): Net appreciation (depreciation) in fair value of investments 1,996,098 7,713,249 Interest 8,238 5,854 1 Other 1,926 1,022 Total investment income 2,006,262 7,720,125 1 Less investment expenses 577,798 565,922 Net investment income (loss) 1,428,464 7,154,203 I Total additions 7,588,639 12,899,079 I Deductions: Benefits: Age and service 4,547,456 4,203,164 Disability 324,876 353,503 II Beneficiaries 40,009 40,516 Drop payments 526,372 880,006 Refunds 69,179 42,665 Administrative expenses 153,104 125,126 Total deductions 5,660,996 5,644,980 I Net increase in net position 1,927,643 7,254,099 Net position restricted for pensions: 1 Beginning of year 76,282,065 69,027,966 End of year $ 78,209,708 $ 76,282,065 1 1 1 1 See Notes to Financial Statements. I 4 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 1. Description of the Plan 1 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, 2015 the Plan's membership consisted of: Retirees and beneficiaries: Currently receiving benefits 120 Drop Retirees 37 ' Terminated employees entitled to benefits but not yet receiving them 7 ' Total 164 ' Current employees: Vested 83 Nonvested 56 1 Total 139 ' ' At September 30, 2014, the date of the most recent actuarial valuation, there were 105 retirees and beneficiaries receiving benefits. 5 1 t BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 I 1. Description of Plan (Continued) I 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 1 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 I benefits is the participant's average salary during the five highest years of the last ten years of creditable service prior to retirement. 1 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 I 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. 1 Monthly Supplemental Retirement Benefit - Effective October 1, 2006, any retiree or beneficiary receiving pension benefits is entitled to a monthly supplemental pension I benefit. The benefit pool will be funded by 100% of the annual earnings and 10% of the principal created by the contributions received. I 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. I 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 1 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. 1 The actuarial value of the monthly supplemental benefit reserve at September 30, 2014 was approximately $2,463,259. 1 1 1 1 6 1 ' BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 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 1 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 1 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 1 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' 1 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 service are payable until the death of the spouse. The spouse will receive the accrued ' norm of retirement benefit tak into account compensation earned and serv 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. 1 7 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND • 1 NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 1 1. Description of Plan (Continued) 1 Post retirement death benefits are payable to the participant's eligible widow depending on the survivor's benefit selected. 1 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 I 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 1 accrual basis of accounting is used for the Plan. Under the accrual basis of accounting, I 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 I 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. 1 Basis of Presentation - The accompanying financial statements are presented in accordance with Governmental Accounting Standards Board (GASB) Statement 67, Financial Reporting for Defined Benefit Pension Plans and the Codification of 1 Governmental Accounting and Financial Reporting Standards which covers the reporting requirements for defined benefit pensions established by a governmental employer. The accompanying fmancial 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 I 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 I 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. 1 Purchases and sales of investments are recorded on a trade date basis. 1 1 8 1 I BOYNTON BEACH POLICE OFFICERS' PENSION FUND 1 NOTES TO FINANCIAL STATEMENTS I September 30, 2015 and 2014 1 2. Summary of Significant Accounting Policies (Continued) I 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 I 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 Position. Custody of Assets - Custodial and investment services are provided to the Plan U 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. 1 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 1 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. I Permissible investments include obligations of the U.S. Treasury and U.S. agencies, high capitalization common or preferred stocks, pooled equity funds, high quality I 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 I permissible investments from the Plan can be found in the Statement of Investment Policies. I 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 I of entry into the Plan through the date of retirement. Reporting Entity - The financial statements presented are only for the Plan and are p g Y p Y 1 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 I (CAFR) for the years ended September 30, 2015 and 2014, which are separately issued documents. Anyone wishing further information about the City is referred to the City's CAFR. I 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 I provisions of the Plan provide for retirement, disability, and survivor benefits. 1 . 9 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 1 2. Summary of Significant Accounting Policies (Continued) 1 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, 2015 and 2014 was 38.21% and 37.71%, respectively This rate consists of 19.88% and 18.87% of member salaries to pay normal costs plus 18.33% and 18.84% to ' amortize the unfunded actuarially accrued liability pursuant to the September 30, 2014 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. 1 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. 1 1 1 10 1 I BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 2. Summary of Significant Accounting Policies (Continued) 1 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 I contingent assets and liabilities at the date of the fmancial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. I Subsequent Events - Management has adopted the provisions set forth in GASB Statement No. 56, Subsequent Events and considered subsequent events through the date 1 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, 2014 have been restated to conform to the presentation used in the financial statements for the fiscal year ended September 30, 2015. I New Accounting Pronouncements - Governmental Accounting Standards Board (GASB) 67, Financial Reportingfor Pension Plans and GASB 68, Accounting &Financial I Reporting for Pensions (Employer), address accounting and fmancial reporting requirements for pension plan activities. The City of Boynton Beach Police Officers' Pension Plan (Plan) is a single employer pension plan as defined by GASB 67. The I requirements for GASB 67 require changes in presentation of the fmancial statements, notes to the fmancial statements, and required supplementary information. I It is important to note that the disclosures related to GASB 67 are accounting measurements, not actuarial measurements of the funded status of the Plan, and are not used to develop employer contribution rates. 1 1 1 1 . 1 1 1 11 1 I BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 3. Deposits and Investments 1 Deposits I At year end September 30, 2015 the carrying amount of the Plan's deposits was $8,692 and the bank balance was $12,352. The bank balance was covered by federal depository insurance and, for the amount in excess of such federal depository insurance, I 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 1 '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 1 depository in default. Russell Trust Company l) s ived c i n s capacity ' as custodian for the Plan. These funds exist temporarily periodically hold as cash unn in the ste proces ash of it collection from the sale of securities or investments. 1 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. 1 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. I 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 Fund, Multi Manager Bond ' Fund, Large Capital Defensive Equity Fund, and Real Estate Investment Fund are privately placed funds, which operates as alternative investments which offer their shares at the net asset value (NAV) of the funds. 1 1 1 12 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 3. Deposits and Investments (Continued) 1 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 ofthe 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 material. ' 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. 1 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 Y g � g will also effect the estimates of fair value and the effect of such events on the estimated fair ' value could be material. 1 1 13 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 3. Deposits and Investments (Continued) 1 Investments (Continued) I The Plan had no investments that individually represented 5% or more of the Plan's net assets available for benefits as of September 30, 2015. 1 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. 1 The Plan held the following fixed income investments as of September 30, 2015: P2015 Rating. I Fair Standard Effective & Duration Investment Type Value Poor's (Years) 1 Multi manager bond 1 investment fund $ 21,709,238 AA 6.3 1 Total $ 21,709,238 1 Interest Rate Risk - Interest rate risk 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 I 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. I 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 I 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. 1 1 14 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS I September 30, 2015 and 2014 1 3. Deposits and Investments (Continued) 1 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. I 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 1 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 1 form. Investing in Foreign Markets - Investing in foreign markets may involve special 1 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 I 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. I Foreign Tax Withholdings and Reclaims - Withholding taxes on dividends from foreign securities are provided for based on rates established via treaty between the United I 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 changes in fiduciary net position. I ' 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. I Jnvesting in Real Estate - The Plan is subj ect to risks inherent in the ownership and n of real estate. These risks include, among others, those normally associated with changes in the general economic climate, trends in the industry including creditworthiness 1 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 1 1 1 15 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS September 30, 2015 and 2014 1 3. Deposits and Investments (Continued) 1 Investment Asset Allocation - The Plan's adopted asset allocation policy as of ' September 30, 2015 is as follows: Asset Class Target Allocation 1 Global equity 30% Domestic equity 25 Bonds 32 ' Private real estate 5 REITS 2 MLP's 2 1 Commodities 2 Cash 2 Total 100% Rate of Return - For the year ended September 30, 2015 the annual money- weighted rate of return on pension plan investments, net of pension plan investment expense, was 2.5 percent. The money- weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. 1 1 • 1 1 1 1 16 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND I NOTES TO FINANCIAL STATEMENTS I September 30, 2015 and 2014 1 4. Net Increase (Decrease) in Realized and Unrealized Appreciation (Depreciation) of Investments The Plan's investments appreciated (depreciated) in value during the years ended I September 30, 2015 and 2014 as follows:: 2015 I Realized Unrealized Appreciation Appreciation (Depreciation) (Depreciation) Total 1 I Investments at fair value as determined by quoted market price: r Multi manager bond I investment fund $ 745,196 $ (54,069) $ 691,127 Multi asset core investment fund 604,269 (597,727) 6,542 Large capital defensive equity I investment fund 402,735 217,232 619,967 Real estate equity investment fund 678,462 678,462 Net increase (decrease) in realized I and unrealized appreciation (depreciation) of investments $ 1,752,200 $ 243,898 $ 1,996,098 1 2014 I Realized Unrealized Appreciation Appreciation (Depreciation) (Depreciation) Total I Investments at fair value as determined by quoted market price: Multi manager bond 1 investment fund $ 347,914 $ 852,842 $ 1,200,756 Multi asset core investment fund 510,217 2,295,360 2,805,577 Large capital defensive equity investment fund 284,054 3,033,842 3,317,896 Real estate equity investment fund 389,020 389,020 111 Net increase (decrease) in realized and unrealized appreciation (depreciation) of investments $ 1,142,185 $ 6,571,064 $ 7,713,249 1 I 17 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 4. Net Increase (Decrease) in Realized and I Unrealized Appreciation (Depreciation) of Investments (Continued) The calculation of realized gains and losses is independent of the calculation of net 1 appreciation (depreciation) in the fair value of plan investments. liz gains losses investments in 2 1 that had been held for more Unrealized ga sand osses on nvestments so1 d 0 5 I than one year were included in net appreciation (depreciation) reported in the prior year. 5. Investments I The Plan's investments at both market value and cost or adjusted cost as of September 30, 2015 and 2014 are summarized as follows: I 2015 2014 I Investment Cost Market Market Value Cost Value I Multi manager bond investment fund $ 16,922,821 $ 21,709,238 $ 17,829,322 $ 22,669,808 I Multi asset core investment fund 23,645,515 29,668,247 22,680,085 29,300,544 Large capital defensive equity I Investment fund 16,944,384 20,005,118 16,787,875 19,631,376 Real estate equity investment fund 4,850,000 6,259,818 3,450,000 4,181,355 1 Total investments $ 62,362,720 $ 77,642,421 $ 60,747,282 $ 75,783,083 1 1 1 18 ' BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 6. 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 1 the year ended September 30, 2015 are presented below as determined in the Plan's most recent accounting and valuation available for the fiscal year ended September 30, 2015: U 2015 Designated for DROP accounts (fully funded) $ 9,570,232 ' Designated for the supplemental pension distribution reserve 2,463,259 ' Total designated net position 12,033,491 Undesignated net position 66,176,217 1 Total plan net position $ 78,209,708 ' 7. Plan Assumption Changes The actuarial assumptions which were implemented beginning October 1, 2 are 1 summarized as follows: -. The mortality table, which was updated two years ago to the RP-2000 Combined 1 Healthy Participant Mortality Tables for males and females, including proj ections for future improvements in mortality rates, continues to be phased in this year. 1 ➢. 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. 1 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% covered payroll. 1 1 1 19 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 8. Plan Termination I Although it has not expressed an intention to do so, the City may terminate the Plan at any me by a written ordinance of the City Commission of Boynton Beach, duly certified by an of of the City. In the event that the Plan is terminated or contributions to the Plan are I permanently discontinued, the benefits of each police officer in the Plan at such termination date would be non - forfeitable. 1 9. Commitments and Contingencies I 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 I prior to being eligible for pension benefits. At September 30, 2015, aggregate contributions from active members of the Plan were approximately $8,500,000. The portion of these contributions which are refundable to participants who may terminate with less than five I years of service has not been determined. I 10. Risk and Uncertainties I 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 I 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. I 11. DROP Loans 1 During the fiscal year ended September 30, 2015, 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. 1 1 1 20 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 11. DROP Loans (Continued) A schedule of the changes of these loans is summarized as follows: • Balance Balance 9/30/14 Additions Repayments 9/30/15 1 DROP Loans Receivable September 30, 2015 $ 238,163 $ 154,000 $ 92,724 $ 299,439 1 Future minimum annual principal payments on these loans are as follows: September 30 2016 $ 88,854 2017 74,130 2018 71,159 2019 50,779 2020 14,517 Total $ 299,439 1 Loan interest income for the year ended September 30, 2015 was $8,238. 12. Rent Expense 1 The Fund and Boynton Beach Firefighters' Pension Fund are obligated under a joint rental operating lease for office space, which expires on September 30, 2015. The base rent 1 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, 2015 and 2014, rent expense for the Fund under the lease agreement was $6,961 and $6,707, respectively. 1 1 1 21 BOYNTON BEACH POLICE OFFICERS' PENSION FUND ' 1 NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 13. Plan Amendments The Plan was amended during the fiscal year ended September 30, 2015 as follows: Plan was amended to provide clarification that to apply for the disability benefit an employee must be a member of the Plan and to require members who are terminated for q medical reasons to apply for disability benefits within 30 day of termination. These changes will not have an actuarial impact on the cost of this Plan. 1 There were no Plan amendments during the fiscal year ended September 30, 2014. 1 14. Net Pension Liability of the City ' The components of net position liability of the City of Boynton Beach (City) as of September 30, 2015 were as follows: Total Pension Liability $ 116,958,988 1 Plan Fiduciary Net Position 78,209,708 1 City's Net Pension Liability $ 38,749,280 Plan Fiduciary Net Position as a percentage of total pension liability 66.87% Actuarial pension Assumptions - The total ension liability was determined by an actuarial P valuation as of October 1, 2014 using the following actuarial assumptions applied to all 1 measurement periods. Inflation 4.00% ' Salary increases 5.0% to 6.5% depending on age, including inflation Investment rate of return 7.75% 1 1 22 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 14. Net Pension Liability of the City (Continued) ' The long -term expected rate of return on pension plan investments was determined using a building -block method in which best - estimate ranges of expected future real rates of return 1 (expected returns, net of pension plan investment expenses and inflation) are developed for each major asset class. These ranges are combined to produce the long -term expected rate of return by weighting the expected future real rates of return by the target asset allocation 1 percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation as of ' September 30, 2015 are summarized in the following table: Investment Asset Long -Term Expected Real Rate Allocation Asset Class of Return ' 30.0% Global equity 2.24% 25.0 Domestic equity 4.80 32.0 Bonds 2.44 5.0 Private real estate 7.10 2.0 REIT's 11.20 2.0 MLP's 16.90 1 2.0 Commodities 4.90 2.0 Cash 4.10 1 Discount Rate - The 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 period of projected benefit payments to determine the total pension liability. 1 1 1 23 1 1 BOYNTON BEACH POLICE OFFICERS' PENSION FUND NOTES TO FINANCIAL STATEMENTS 1 September 30, 2015 and 2014 1 14. Net Pension Liability of the City (Continued) t t 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 discount rate of 7.75 %, as well 1 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. 1 Sensitivity of the net pension liability to the single discount rate assumption 1 Current Discount 1% Decrease Rate 1% Increase 6.75% 7.75% 8.75% City's Net Pension Liability $ 51,391,148 $ 38,749,280 $ 28,162,264 1 1 1 1 1 1 1 1 24 1 z 0 INN NE me i I i ma NE I — NE Ns No — EN = 1 1 BOYNTON BEACH POLICE OFFICER' PENSION FUND SCHEDULE OF CHANGES IN THE CITY'S I NET PENSION LIABILITY AND RELATED RATIOS Last Two Fiscal Years September 30, September 30, 1 2015 2014 Total pension liability: 1 Service cost $ 2,767,701 $ 2,809,815 Interest 8,679,595 8,234,704 Benefit changes - - ' Differences between actual and expected experience (1,776,804) (129,636) Assumption changes 617,426 - Benefit payments, (5,438,713) (5,477,189) 1 Refunds (69,179) (42,665) Other (adjustments to reserves) 395,891 255,655 1 Net change in total pension liability 5,175,917 5,650,684 Total pension liability - beginning 111,783,071 106,132,387 1 Total pension liability - ending (a) $ 116,958,988 $ 111,783,071 Plan fiduciary net position: I Contributions - employer $ 4,365,259 $ 4,159,736 Contributions - State 675,227 645,579 Contributions - members 1,040,875 911,375 1 Net investment income 1,428,464 7,154,203 Benefit payments (5,438,713) (5,477,189) 1 Refunds (69,179) (42,665) Administrative expense (153,104) (125,126) Other (rollovers into DROP) 78,814 28,186 I Net change in plan fiduciary net position 1,927,643 7,254,099 I Plan fiduciary net position - beginning 76,282,065 69,027,966 Plan fiduciary net position - ending (b) $ 78,209,708 $ 76,282,065 1 Net Pension Liability - Ending (a) - (b) $ 38,749,280 $ 35,501,006 I Plan fiduciary net position as a percentage of total pension liability 66.87% 68.24% Covered employee payroll $ 12,919,713 $ 12,478,996 1 Net pension liability as a percentage of covered employee payroll 299.92% 284.49% 1 1 25 1 BOYNTON BEACH POLICE OFFICER' PENSION FUND SCHEDULE OF CONTRIBUTIONS • Last Two Fiscal Years Fiscal Actual Year Actuarially Contribution Contributions Ended Determined Actual deficiency Covered as a Percentage of September 30, Contribution Contribution (Excess) Pa oll Covered Payroll eP � ) Payroll n 2014 $ 4,560,918 $ 4,624,823 $ (63,905) $ 12,478,996 37.06% 2015 4,830,346 4,830,346 - 12,919,713 37.39 % 1 1 1 1 1 1 1 1 1 1 1 26 1 BOYNTON BEACH POLICE OFFICER' PENSION FUND NOTES TO THE SCHEDULE OF CONTRIBUTIONS September 30, 2015 1 Last Fiscal Year 1 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 in which contributions are reported. 1 Methods and Assumptions Used to Determine Contribution Rates: Actuarial cost method Entry age normal 1 Amortization method Level percent of payroll, closed Remaining amortization period 23 years ' Asset valuation method Inflation 5 -year smoothed market 4.0% Salary increases 5.0% to 6.5% depending on age, including inflation 1 Investment rate of return 7.75% Retirement age Experience -based table of rates that are specific to the type I of eligibility condition 60% RP -2000 Combined Healthy Participant Mortality Table for males and females with mortality improvement 1 projected to all future years after 2000 using Scale AA: 40% 1983 Group Annuity Mortality Table for males and females 1 1 1 1 1 27 1 1 1 1 1 1 1 1 ADDITIONAL INFORMATION 1 1 1 1 1 1 1 1 1 1 I I BOYNTON BEACH POLICE OFFICERS' PENSION FUND SCHEDULES OF INVESTMENT AND ADMINISTRATIVE EXPENSES 1 Years ended September 30, 2015 and 2014 I 2015 2014 Investment Administrative Investment Administrative 1 Expenses Expenses Expenses Expenses Expenses: 1 Actuary fees $ - $ 29,827 $ - $ 12,139 Administrator's fees - 28,763 - 27,393 I Audit fees - 14,500 - 11,000 Bank charges - 105 - 143 I Computer service - 16,223 - 5,906 Directors' liability insurance 17,840 21,048 Dues and subscriptions - 600 - 600 1 Investment managers' fees: Russell Trust Company 552,798 - 545,922 - 1 Legal fees - 15,630 - 16,523 Medical advisor 2,845 1,045 ' Office expenses - 1,234 - 1,557 Office rent - 6,961 - 6,707 I Pension program maintenance - 1,611 - 3,114 Performance monitor 25,000 20,000 - Seminars and training - 13,314 - 15,073 1 Printing expense - 3,651 - 2,878 $ 577,798 $ 153,104 $ 565,922 $ 125,126 I Percentage of plan net position 0.74% 0.20% 0.74% 0.16% 1 1 1 1 28 Milliman Actuarial Valuation Executive Summary 1. Executive Summary This report presents the results of our July 1, 2015 actuarial valuation of the defined benefit Florida Retirement System (FRS) Pension Plan. This valuation is used to determine actuarially calculated Pension Plan- specific employer contribution rates for the July 1, 2016 — June 30, 2017 plan year. The Pension -Plan specific rates developed in this valuation report are then combined with contribution rates from the defined contribution FRS Investment Plan to create blended proposed statutory employer contribution rates. The actual contribution rates paid by employers during the 2016 -2017 plan year will be determined by Florida Statute. The statutory contribution rates in effect for the current 2015 -2016 plan year are identical to the blended proposed statutory rates developed in conjunction with the July 1, 2014 actuarial valuation. On the smoothed Actuarial Value of Assets basis used to determine actuarially calculated contribution rates, Pension Plan funded status decreased slightly from 86.6% to 86.5 %. On a Market Value of Assets basis, Pension Plan funded status decreased from 93.7% to 89.7% due to actual plan year investment return of +3.76% compared to an assumed return of 7.65 %. Pension Plan actuarially calculated employer contribution rates, prior to blending with Investment Plan rates to create blended proposed statutory contribution rates, increased from 8.99% of pay to 9.23% of pay on a composite basis. The most significant rate increase sources were a) actual growth of payroll to amortize the Unfunded Actuarial Liability (UAL) was only 2.3 %, compared to the assumed payroll growth of 3.25 %, b) an increased percentage of Pension Plan payroll in the Special Risk Membership Class, which has higher cost benefits than Regular Membership Class, and c) actual plan year demographic experience differing from assumption, including the effects of actual retirement/DROP entry at rates higher than assumed. Due to strong overall investment performance over the past several years,. the Market Value of Assets exceeds the smoothed Actuarial Value of Assets used for funded status and contribution rate calculations by $5.3 billion as of July 1, 2015. That $5.3 billion not yet recognized investment gain will be systematically recognized over the next several years if investment experience during that period meets or exceeds assumption. Alternatively, if actual investment experience during that period fails to meet the 7.65% assumption used in this valuation, the not yet recognized gain will serve as a cushion to help mitigate the magnitude of increases in actuarially calculated employer contribution rates. For this valuation a long -term average annual future investment return assumption of 7.65% was used. That assumption was initially adopted for use by the 2014 FRS Actuarial Assumptions Conference. While this assumption is identical to that used in the previous valuation, it is materially above the 50 percentile average returns in the proprietary capital market outlook models of both Milliman and the State Board of Administration's investment consultant (Aon Hewitt Investment Consulting). The Milliman and Aon Hewitt models each have 50 percentile average annual long -term future returns in the 6.8 % -6.9% range, and both models indicate an approximately 35% likelihood of actual long -term future returns meeting or exceeding 7.65 %. All else being equal, the lower the selected investment return assumption, the higher the likelihood the Pension Plan will meet or exceed its assumed investment return in future years. A lower assumption would result in higher short-term actuarially calculated contribution rates for employers, but would also serve to lessen the magnitude of actuarially calculated contribution rate increases in the event that actual future investment performance fails to meet the assumption. The financial reporting information under GASB 67 requirements is issued under separate cover. This work product was prepared solely for the Florida Department of Management Services for the purposes Mill iman stated herein, and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional when reviewing the Milliman work product. Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone EAU •; Consultants 8c Actuaries Suite 505 954.525.0083 fax Ft. Lauderdale, FL 33301 -1804 www.gabrielroeder.com January 22, 2016 Ms. Barbara La Due, Pension Administrator Boynton Beach Police Officers' Pension Board • Renaissance Executive Suites 1500 Gateway Blvd Suite 220 Boynton Beach, Florida 33426 Re: City of Boynton Beach Municipal Police Officers' Retirement Fund Updated GASB No. 67 Disclosure Information Dear Barbara: We have prepared the updated actuarial disclosure information required under Governmental Accounting Standards Board (GASB) Statement No. 67 for the fiscal year ending September 30, 2015. The following exhibits were based upon audited financial information as of September 30, 2015, which was furnished by the Plan's auditor (Davidson, Jamieson & Cristini) as well as information furnished by the Plan Administrator. If any of this information changes during the auditing process (including benefit payments, contributions, administrative expenses, or the actual market value of assets as of September 30, 2015), then the following exhibits will need to be revised: • Statement of changes in Net Pension Liability and Ratios, using the single discount rate • Schedule of the Employer's Net Pension Liability • Notes to Net Pension Liability • Schedule of Contributions • Notes to Schedule of Contributions • Sensitivity analysis The actuarial valuation of the liabilities has been determined as of the beginning of the year, October 1, 2014, and "rolled forward" to the measurement date, September 30, 2015. Using beginning of the year valuation of liabilities allows for more timely reporting at the end of the year. Please refer to our October 1, 2014 actuarial valuation report dated March 6, 2015 for information related to participant data, economic and demographic assumptions, and benefit provisions. Please note that there are other items not listed above that will be required in the Plan's financial statements and /or the City's Comprehensive Annual Financial Report (CAFR) to fully comply with GASB No. 67 standards. This additional information will need to be provided by the Plan's investment consultants, accountants or other financial statement preparers. • The liability calculations are based upon information furnished by the Plan Administrator for the October 1, 2014 Actuarial Valuation concerning plan benefits, financial transactions, plan provisions, and active members, retirees and beneficiaries. We reviewed this information 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. The calculations are based upon assumptions regarding future events, which may or may not materialize. Ms. Barbara La Due January 22, 2016 Page 2 They are also based on the assumptions, methods, and plan provisions outlined in our October 1, 2014 Actuarial-Valuation Report. If you . have reason to believe that the assumptions that were used are unreasonable, that the plan provisions are incorrectly described, or that conditions have changed since the calculations were made, you should contact the author of this letter prior to relying on information in the letter. This report may be distributed to other parties' only in its entirety. Future actuarial measurements may differ significantly from the current measurements presented in this letter due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in such 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, iii additional cost or contribution requirements based on the plan's funded status) and changes in plan provisions or applicable law. To best of our knowledge, the information contained in this report is accurate and fairly presents the actuarial position, of the plan as of the valuation date. All calculations have been made in conformity with generally acceptelactuarial principles and practices, with the Actuarial Standards of Practice issued by the Actuarial Standard` Board, and with applicable statutes. Peter N and Jeffrey Amrose are Members of the American Academy of Actuaries (MAAA) and meet the Qualification Standards of the American Academy of Actuaries to render the actuarial opinions contained herein. The undersigned actuaries are independent ofthe plan sponsor. s. i t We welcome your questions and comments, Respectfully submitted, „.6j • li 0 , i .; ii ‘ if ii eter W Strong, FSA, E ' AAA, FCA ,leffr Amrose, EA, MAAA Senior Consultant & Act . Senior Consultant & Actuary PS /ib cl Enclosures ii This communication shall not be construed to provide tax advice, legal advice or investment advice. Gabriel Roeder Smith & Company SCHEDULE OF CHANGES IN THE EMPLOYER'S NET PENSION LIABILITY AND RELATED RATIOS GASB Statement No. 67 Fiscal year ending September 30, 2015 2014 Total pension liability Service Cost $ 2,767,701 $ 2,809,815 Interest 8,679,595 8,234,704 Benefit Changes - - Difference between actual & expected experience (1,776,804) (129,636) Assumption Changes 617,426 - Benefit Payments (5,438,713) (5,477,189) Refunds (69,179) (42,665) Other (Adjustments, to Reserves) 395,891 255,655 Net Change in Total Pension Liability 5,175,917 5,650,684 Total Pension Liability - Beginning 111,783,071 106,132,387 Total Pension Liability - Ending (a) $ ;116,958,988 $ 111,783,071 Plan Fiduciary Net Position Contributions - Employer (from City) $ 4,365,259 $ 4,159,736 Contributions - Employer (from State) $ 675,227 645,579 Contributions - Non-Employer Contributing Entity - - Contributions - Member 1,040,875 911,375 Net Investment Income 1,428,464 7,154,203 Benefit Payments (5,438,713) (5,477,189) Refunds (69,179) (42,665) Administrative Expense (153,104) (125,126) Other 78,814 28,186 Net Change in Plan Fiduciary Net Position 1,927,643 7,254,099 Plan Fiduciary Net Position - Beginning 76,282,065 69,027,966 I'Y g g Plan Fiduciary Net Position - Ending (b) $ 78,209,708 $ 76,282,065 Net Pension Liability - Ending (a) - (b) 38,749,280 35,501,006 Plan Fiduciary Net Position as a Percentage of Total Pension Liability 66.87 % 68.24 % Covered Employee Payroll 12,919,713 $ 12,478,996 Net Pension Liability as a Percentage of Covered Employee Payroll 299.92 % 284.49 % 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 % of September 30, Liability Position Liability Pension Liability Payroll Covered Payroll 2014 $111,783,071 $ 76,282,065 $35,501,006 68.24% $12,478,996 284.49% 2015 $116,958,988 $ 78,209,708 $38,749,280 66.87% $12,919,713 299.92% NOTES TO NET PENSION LIABILITY GASB Statement No. 67 Valuation Date: October 1, 2014 Measurement Date: September 30, 2015 Methods and Assumptions Used to Determine Net Pension Liability: Actuarial Cost Method Entry Age Normal 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 80% RP -2000 Combined Healthy Participant Mortality Table for males and females with mortality improvement projected to all future years after 2000 using Scale AA; 20% 1983 Group Annuity Mortality Table for males and females. Other Information: Notes See Discussion of Valuation Results in the October 1, 2014 Actuarial Valuation Report. SCHEDULE OF CONTRIBUTIONS GASB Statement No. 67 Actuarially Contribution Actual Contribution FY Ending Determined Actual Deficiency Covered as a % of September 30, Contribution Contribution (Excess) Payroll Covered Payroll 2014 $ 4,560,918 $ 4,624,823 $ (63,905) $ 12,478,996 37.06% 2015 $ 4,830,346 $ 4,830,346 $ - $ 12,919,713 37.39% 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 in 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: See Discussion of Valuation Results in the October 1, 2013 Actuarial Notes Valuation Report. 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% $ 51,391,148 $ 38,749,280 $ 28,162,264 BOYNTON BEACH POLICE OFFICERS' PENSION FUND September 30, 2015 Long -Term Target Expected Real GASB 67 Allocation Asset Class Rate of Return Proof 30 % Global equity 2.24 % 0.67 % 25 Domestic equity 4.80 1.20 32 Bonds 2.44 0.78 5 Private real estate 7.10 0.36 2 REITS 11.20 0.22 2 MPL 16.90 0.34 2 Commodities 4.90 0.10 2 Cash 4.10 0.08 100 % - Total 3.75 % ROR 7.75 % Inflation 4.00 ROR without Inflation 335 % Ref. GASB 67, Illustration, pages 77, 78 and 79. • 11. I I , GRS Gabriel Roeder Smith 8c Company Consultants & Actuaries II 1 1 1 CITY OF BOYNTON BEACH MUNICIPAL POLICE OFFICERS' RETIREMENT FUND • ACTUARIAL VALUATION REPORT AS OF OCTOBER 1, 2015 ANNUAL EMPLOYER CONTRIBUTION IS DETERMINED BY THIS VALUATION FOR THE ■ PLAN YEAR ENDING SEPTEMBER 30, 2017 ■ 1 1 ■ Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone Consultants tic Actuaries Suite 505 954.525.0083 fax ■ Ft. Lauderdale, FL 33301 -1804 www.gabrielroeder.com Febaruary 8, 2016 ■ Board of Trustees ■ City of Boynton Beach Municipal Police Officers' Retirement Fund ■ Boynton Beach, Florida Dear Board Members: The results of the October 1, 2015 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. GRS is not responsible for unauthorized use of this report. ■ 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, 2017, and to determine the actuarial information for Governmental Accounting Standards Board (GASB) Statement No. 67. This report also includes estimated GASB Statement No. 67 information for the fiscal year ending September 30, 2016. This report should not be relied on for any purpose other than the purposes described herein. Determinations of financial ■ results associated with the benefits described in this report, for purposes other than those identified above may be significantly different. The findings in this report are based on data or other information through September 30, 2015. 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 scope of an actuarial valuation does not include an analysis of the potential range of such future measurements. This valuation assumed the continuing ability of the plan sponsor to make the contributions necessary to fund ■ this plan. A determination regarding whether or not the plan sponsor is actually able to do so is outside our scope of expertise and was not performed. ■ The valuation was based upon information furnished by the Plan Administrator concerning Retirement Plan ■ 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. In addition, this report was prepared using assumptions approved by the Board as described in the section of this report entitled Actuarial Assumptions and Methods. 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 Plan as of the valuation date. All calculations have been made in 1 ■ ■ ■ ■ conformity with generally accepted actuarial principles and practices, with the Actuarial Standards of Practice issued by the Actuarial Standards Board, and with applicable statutes. ■ Peter N. Strong and Jeffrey Amrose are members of the American Academy of Actuaries. These actuaries ■ meet the Academy's Qualification Standards to render the actuarial opinions contained herein. ■ The signing actuaries are independent of the plan sponsor. ■ 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 our knowledge, the results are complete and accurate. In our 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. Gabriel, Roeder, Smith & Company will be pleased to review this valuation report with the Board of Trustees and to answer any questions pertaining to the valuation. ■ Respectfully submitted, ■ GABRIEL, ROEDER, SMITH AND COMPANY ■ ■ By ��L�i By Peter N. Strong, FSA, F , MAAA J ffr fAmrose, MAAA Enrolled Actuary No. 14- 06975 nrol ed Actuary No. 14 -06599 ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ Gabriel Roeder Smith & Company • TABLE OF CONTENTS ■ Section Title Page ■ A Discussion of Valuation Results 1 w Chapter Revenue 5 ■ B Valuation Results El 1. Participant Data 6 2. Actuarially Determined Employer • Contribution (ADEC) 7 3. Actuarial Value of Benefits & Assets 8 i 4. Calculation of Employer Normal Cost 9 5. Liquidation of the Unfunded Frozen MI 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. Reconciliation of DROP Accounts 32 III 5. Investment Rate of Return 33 D Financial Accounting Information II 1. FASB No. 35 34 3. GASB No. 67 35 II E Miscellaneous Information 11 1. Reconciliation of Membership Data 41 ■ 2. Age /Service /Salary Distributions 42 . F Summary of Plan Provisions 44 11 11 1 • GRS • • • • • • • • SECTION A • DISCUSSION OF VALUATION RESULTS • • • • • • • N • • • • • • • • • • • • • ■ GRS ■ ■ 1 ■ DISCUSSION OF VALUATION RESULTS ■ Comparison of Required Employer Contributions ■ A comparison of the required employer contribution developed in this and the last actuarial valuation is ■ shown below. 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 9/30/17 For FYE 9/30/16 ■ Based on Based on 10/1/2015 10/1/2014 Increase ■ Valuation Valuation (Decrease) ■ Required Employer /State Contribution $ 5,256,615 $ 4,856,392 $ 400,223 As % of Covered Payroll 43.16 % 42.26 % 0.90 % ■ Estimated State Contribution $ 465,087 $ 465,087 $ 0 ■ As % of Covered Payroll 3.82 % 4.05 % (0.23) % ■ Required Employer Contribution $ 4,791,528 $ 4,391,305 $ 400,223 ■ As % of Covered Payroll 39.34 % 38.21 % 1.13 % ■ ■ The required employer contribution 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 w 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, 2017 and has ■ been calculated assuming the employer contribution is made on October 1, 2016. The actual City contribution ■ for the fiscal year ending September 30, 2015 was $4,365,259, which equals the required contribution. ■ ■ ■ ■ ■ • GRS 2 Revisions in Benefits Ordinance 15 -022 was passed after second reading on September 3, 2015. Pursuant to the adoption of 11111 this Ordinance, the benefit accrual rate for all Members hired on or after October 1, 2015 will be 3.0% per year • of Credited Service. The benefit accrual rate for all Members hired prior to October 1, 2015 continues to be ■ 3.5% per year of Credited Service. The adoption of this Ordinance does not have an immediate impact on the Plan's funding requirement. 111 Revisions in Actuarial Assumptions and Methods The following revisions in actuarial assumptions have been approved by the Board and incorporated ■ into this report: ■ ➢ The assumed withdrawal rates, which were initially updated four years ago (please see the ■ actuarial assumptions and methods section), have been fully phased in this year. This revision . was phased in over a five -year period, which began with the October 1, 2011 actuarial ■ valuation. In the previous year's actuarial valuation, 80% of the revised rates and 20% of the ■ prior rates were used. R ➢ In addition, a change in the mortality assumption to the RP -2000 Conbined Healthy Participant Mortality Tables for males and females, including projections for future improvement in ■ mortality rates to all future years using scale AA, was due to be fully phased in this year. Pursuant to Florida House Bill 1309, the Plan will be required to implement the same Mortality Tables used by the Florida Retirement System (FRS) by October 1, 2016 Actuarial Valuation. The Board has elected to implement this requirement effective October 1, 2015 (one year early). The combination of the phased in withdrawal rates and the early implementation of the FRS mortality tables caused the employer contribution rate to increase by 0.27% of covered payroll. ■ We recommend lowering the investment return assumption. Currently, the assumption is 7.75% net of 11 investment related expenses which translates to an approximate gross rate of 8.5% (gross of investment ■ expenses). We believe this is at the high end of the reasonable range for this assumption and strong GRS • ■ 3 ■ consideration should be given to reducing it. Lowering this assumption will decrease the probability of incurring future actuarial experience losses (and higher required employer contributions) due to investment ■ performance in future years. ■ Actuarial Experience ■ There was a net actuarial loss of $1,896,466 for the year, which means that actual experience was less ■ favorable than expected. The actuarial loss was primarily due to higher than expected salary increases, the ■ occurrence of a disability retirement, and lower mortality experience than expected amongst retirees. Average ■ salary increases were 8.6%, versus 5.8% expected. The loss was also partially due to ■ rY p p y recognized investment • earnings being less than assumed. The return on the actuarial value of assets was 7.54 %, versus 7.75% ■ expected. The return on the market value of assets was 1.87 %. The net actuarial loss for the year caused an increase in the annual required employer contribution of ■ 0.86% of covered payroll (or $104,743). Funded Ratio ■ The funded ratio is 63.3% as of October 1, 2015 compared to 62.3% as of October 1, 2014. Before the ■ change in assumptions described above, the funded ratio as of October 1, 2015 was 62.9 %. 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 38.21 % Actuarial Experience 0.86 ■ Change in Administrative Expense 0.14 Amortization Payment on UAL (0.41) Change in State Contribution 0.23 ■ Change in Normal Cost Rate 0.04 Change in Assumptions and Methods 0.27 ■ Contribution Rate This Year 39.34 ■ Required Contributions in Later Years ■ The current calculated City contribution requirement is 39.34% of payroll starting October 1, 2016. It ■ is important to keep in mind that under the asset smoothing method, gains and losses are recognized over five ■ ■ GRS 4 years. As of September 30, 2015, the actuarial value of assets exceeded the market value of assets by ■ $702,517. Once all the gains and losses through September 30, 2015 are fully recognized in the actuarial asset ■ values, the contribution rate will increase by roughly 0.3% of payroll before any other changes are taken into ■ account, unless there are offsetting gains. 111 Another important factor to consider is the annual payment on the unfunded accrued liability (UAL). 11 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 . 4.16 %. Therefore, the UAL is being amortized with a 4.00% payroll growth assumption. However, over the ■ next few years, the ten -year average payroll growth rate is expected to decline due to flat or negative payroll increases in recent years. This will put upward pressure on the city contribution rate. If the payroll growth assumption was 0.0 %, the city contribution rate would increase by approximately 8.1% of covered payroll ■ (approximately $988,000). ■ Relationship to Market Value ■ If Market Value had been the basis for the valuation, the City contribution rate would have been ■ 39.66% ($4,830,502) for the fiscal year ending September 30, 2016 and the funded ratio would have been ■ 62.6 %. ■ Conclusion ■ The remainder of this Report includes detailed actuarial valuation results, financial information, ■ miscellaneous information and statistics, and a summary of plan provisions. ■ 11 11 ■ GRS ■ III 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 675,227 3. Benefit Improvements Made in Previous Plan Year 0 4. Excess Funds for Previous Plan Year: (2) - (1) - (3) 210,140 ■ 5. Accumulated Excess at Beginning of Previous Year 69,784 6. Prior Excess Used in Previous Plan Year 185,320 7. Accumulated Excess as of Valuation Date ■ (Available for Benefit Improvements) 94,604 ■ 8. Base Amount This Plan Year 465,087 imm MO ■ GRS • • • • • • SECTION B • VALUATION RESULTS • • • • • • • • • • • • • • • • • • • • • • • • GRS • 6 III III I. PARTICIPANT DATA . October 1, 2015 October 1, 2014 . ACTIVE MEMBERS ■ Number 137 139 ■ Covered Annual Payroll $ 11,774,623 $ 11,142,832 Average Annual P ayroll $ 85,946 $ 80,164 II Average Age 39.2 38.7 ■ Average Past Service 10.6 10.3 Average Age at Hire 28.6 28.4 III ■ RETIREES & BENEFICIARIES & DROP II Number 106 102 . Annual Benefits $ 5,053,753 $ 4,806,738 Average Annual Benefit $ 47,677 $ 47,125 • Average Age 58.9 58.3 • ill DISABILITY RETIREES II Number 14 14 III Average Benefits $ 305,130 $ 288,518 Average Annual Benefit $ 21,795 $ 20,608 ■ Average Age 62.4 63.9 ■ TERMINATED VESTED MEMBERS ■ ■ Number 10 7 Annual Benefits $ 234,356 $ 157,128 II Average Annual Benefit $ 23,436 $ 22,447 ® Average Age 36.5 38.6 III II II II IN GRS ■ III 7 ■ II III ACTUARIALLY DETERMINED EMPLOYER CONTRIBUTION (ADEC) ■ A. Valuation Date October 1, 2015 October 1, 2015 October 1, 2014 ■ Current Assumptions Prior Assumptions (FRS Mortality with (with 80% phase -in of III 100% phase -in of New Mortality and Termination Rates) Termination rates) ■ B. ADEC to Be Paid During Fiscal Year Ending 9/30/2017 9/30/2017 9/30/2016 ■ C. Assumed Date of Employer Contrib. 10/1/2016 10/1/2016 10/1/2015 ■ D. Annual Payment to Amortize Unfunded Actuarial Liability $ 2,656,247 $ 2,687,561 $ 2,493,837 ■ E. Employer Normal Cost 2,425,913 2,362,336 2,214,983 ■ F. ADEC if Paid on the Valuation ■ Date: D+E 5,082,160 5,049,897 4,708,820 G. ADEC Adjusted for Frequency of ■ Payments 5,082,160 5,049,897 4,708,820 ■ H. ADEC as % of Covered Payroll 43.16 % 42.89 % 42.26 % ■ I. Assumed Rate of Increase in Covered Payroll to Contribution Year N/A % N/A % N/A % ■ J. Covered Payroll for Contribution Year 12,179,367 * 12,179,367 * 11,491,698 * . K. ADEC for Contribution Year: H xJ 5,256,615 5,223,731 4,856,392 ■ L. Estimate of State Revenue in Contribution Year 465,087 465,087 465,087 ■ M. Actuarially Determined Employer ■ Contribution (ADEC) in Contribution Year 4,791,528 4,758,644 4,391,305 II N. ADEC as % of Covered Payroll in Contribution Year: M _ J 39.34 % 39.07 % 38.21 % III *Estimate provided by the City, but adjusted to reflect average overtime during the last three years. ■ III ■ II 1. III 11 GRS ■ 11 NI II 8 IN ACTUARIAL VALUE OF BENEFITS AND AS SETS III A. Valuation Date October 1, 2015 October 1, 2015 October 1, 2014 U Current Assumptions Prior Assumptions (FRS Mortality with (with 80% phase -in of III 100% phase -in of New Mortality and Termination Rates) Termination rates) Il B. Actuarial Pres ent Value of All Projected Benefits for 1. 1. Active Members III a. Service Retirement Benefits $ 63,650,705 $ 64,629,189 $ 60,644,027 b. Vesting Benefits 2,335,667 2,411,993 2,511,817 El c. Disability Benefits 3,651,662 4,019,693 3,855,663 d. Preretirement Death Benefits 2,140,193 827,455 815,796 N e. Return of Member Contributions 34,565 35,646 30,799 f. Total 71,812,792 71,923,976 67,858,102 ■ 2. Inactive Members a. Service Retirees & Beneficiaries 57,155,204 56,894,370 54,468,058 III b. Disability Retirees 2,793,859 2,886,509 2,428,942 c. Terminated Vested Members 1,655,681 1,674,848 1,115,450 . d. Total 61,604,744 61,455,727 58,012,450 II 3. Total for All Members 133,417,536 133,379,703 125,870,552 C. Actuarial Accrued (Past Service) . Liability per GASB No. 25 106,464,806 107,053,667 99,965,363 D. Actuarial Value of Accumulated Plan ■ Benefits perFASBNo. 35 94,104,420 94,089,533 88,601,310 E. Plan Assets ■ 1. Market Value 66,678,188 66,678,188 65,711,402 II 2. Actuarial Value 67,380,705 67,380,705 62,320,013 F. Unfunded Actuarial Accrued ■ Liability: C - E2 39,084,101 39,672,962 37,645,350 G. Actuarial Present Value of Projected III Covered Payroll 102,461,195 101,827,020 100,306,242 H. Actuarial Present Value of Projected . ■ Member Contributions 7,172,284 7,127,891 7,021,437 I. Accumulated Contributions of . Active Members 7,050,516 7,050,516 6,800,856 II IN II III III • GRS ■ ■ 9 ■ ■ ENTRY AGE NORMAL METHOD ■ CALCULATION OF EMPLOYER NORMAL COST ■ A. Valuation Date October 1, 2015 October 1, 2015 October 1, 2014 ■ Current Assumptions Prior Assumptions ■ (FRS Mortality with (with 80% phase -in of 100% phase -in of New Mortality and Tenn ination Rates) Termination rates) ■ B. Normal Cost for ■ 1. Service Retirement Benefits $ 2,502,042 $ 2,467,551 $ 2,334,437 ■ 2. Vesting Benefits 191,879 210,639 200,531 3. Disability Benefits 265,460 291,581 270,505 ■ 4. Preretirement Death Benefits 125,338 43,997 42,125 5. Retum of Member Contributions 26,303 33,677 31,852 ■ 6. Total for Future Benefits 3,111,022 3,047,445 2,879,450 7. Assumed Amount for Administrative ■ Expenses 139,115 139,115 115,531 8. Total Normal Cost 3,250,137 3,186,560 2,994,981 ■ C. Expected Member Contribution 824,224 824,224 779,998 ■ D. Employer Normal Cost: B8 -C 2,425,913 2,362,336 2,214,983 ■ E. Employer Normal Cost as a % of Covered Payroll 20.60% 20.06% 19.88% ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ GRS ■ ■ ■ II 10 ■ LIQUIDATION OF THE UNFUNDED ACTUARIAL ACCRUED LIABILITY ■ UAAL Amortization Period and Payments ■ Original UAAL Current UAAL Type of Amortization ■ Date Amortization Period Years El Es tablis he d Base (Years) Amount Remaining Amount Payment 10/1/98 Fresh Start 30 $ 1,331,353 13 $ 1,406,846 $ 132,678 ■ 10/1/99 Plan Amendment 30 1,656,722 14 1,781,933 158,614 10 /1 /00 Plan Amendment 30 185,619 15 200,933 16,966 ■ 10/1/01 Plan Amendment 30 46,601 16 51,340 4,130 10/1/04 Plan Amendment 30 1,166,935 19 1,333,480 94,743 il 10/1/05 Plan Amendment 30 2,985,574 20 3,424,980 234,830 10/1/05 Method/Assum Change 30 13,646,165 20 15,654,552 1,073,337 10/1/06 Experience Loss 30 2,307,394 21 2,651,994 175,893 1 III 10/1/07 Experience Loss 30 16,404 22 18,789 1,208 10/1/08 Experience Loss 30 3,582,504 23 4,059,562 253,543 10/1/09 Experience Loss 30 3,419,100 24 3,826,354 232,547 111 10/1/10 Experience Loss 30 1,404,570 25 1,549,770 91,803 10 /1 /11 Experience Loss 30 4,476,765 26 4,846,629 280,250 ■ 10 /1 /11 Assumption Change 30 1,634,520 26 1,769,561 102,323 10/1/12 Experience Gain 30 (2,249,576) 27 (2,369,266) (133,917) 10/1/12 Assumption Change 30 412,194 27 434,125 24,538 10/1/12 Plan Amendment 30 (426,604) 27 (449,302) (25,396) 10/1/13 Experience Gain 30 (794,394) 28 (824,387) (45,606) 10/1/13 Assumption Change 30 430,545 28 446,801 24,717 10/1/14 Experience Gain 30 (2,463,259) 29 (2,507,808) (135,945) ■ 10/1/14 Assumption Change 30 461,268 29 469,610 25,457 10/1/15 Experience Loss 30 1,896,466 30 1,896,466 100,848 10/1/15 Assumption Change 30 (588,861) 30 (588,861) (31,314) ■ $ 34,538,005 $ 39,084,101 $ 2,656,247 Amortization Schedule III The UAAL is being amortized as a level percent of payroll over the number of years remaining in the amortization 1 III period. The expected amortization schedule is as follows: ■ Amortization Schedule ■ Year Expected UAAL ■ 2015 $ 39,084,101 2016 39,251,009 ■ 2017 39,316,371 2018 39,267,736 II. 2019 39,091,506 2020 38,772,838 II 2025 34,422,545 2030 24,161,402 2035 6,702,969 2040 (101,064) ■ 2044 - II 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 experience can vary from ■ these expectations. The variance is measured by the gain and loss for the period involved. If significant long term 11 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 $ 37,645,350 2. Last Year's Employer Normal Cost 2,214,983 111 3. Last Year's Contributions 4,830,346 4. Interest at the Assumed Rate on: a. 1 and 2 for one year 3,089,176 b. 3 from dates aid p 342,667 c. a - b 2,746,509 ■ 5. This Year's Expected UAAL: 1 + 2 - 3 + 4c 37,776,496 ■ 6. This Year's Actual UAAL (Before any ■ changes in benefits and assumptions) 39,672,962 7. Net Actuarial Gain (Loss): (5) - (6) (1,896,466) 8. Gain (Loss) due to investments (150,739) 9. Gain (Loss) due to other sources (1,745,727) ■ Net actuarial gains in previous years are detailed in the table on the next page. ■ 11 il 11 GRS • ■ 12 III • HISTORY OF NET ACTUARIAL GAINS AND LOSSES • Change in Employer Year Ended Cost Rate * Gain (Loss) ■ 12/31/82 0.46 % $ (56,551) 12/31/83 1.92 (265,213) El 12/31/84 (0.04) 6,977 I. 12/31/85 (0.85) 185,443 12/31/86 (0.59) 158,678 III 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 .1 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 III 9/30/01 3.92 (1,978,307) II 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) 111 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 III 9/30/14 (1.18) 2,463,259 III 9/30/15 0.86 (1,896,466) . * Before 9/30/06, change in Employer Normal Cost. II II • • GRS ■ ■ 13 ■ ■ ■ Actuarial Gain ( +) or Loss ( -) ■ $10 - - - $10 $5 $5 • $o 'sue -�. M at _ o ■ ($10) _ . ($10) ■ ($15) : ($15) ■ ($ E ' ($ ■ - ($25) - ( $25) ■ Plan Year End ■ mom Gain or Loss —•-- Cumulative ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ GRS ■ ■ III • 14 Ill ■ Change in Employer Cost Rate 24% - -- - 24% ■ 22% - = 22% 20% = r ''' 1' . 20% ■ 18% - x - 18% 16% = = 16% ■ 14% - = 14% 12% = fi - 12% ■ 10% = , . - 10% 8% - - 8% ■ 6% - 6% 4% = — 4% A. III w } F ( 2% II }: 't — -4% -2% 4% = - -4% M -6% • = -6% -8% =- — • -8% ■ cbl' R� g 4h X4 c 'lib g°1 �q c)\ \qb �q) q 1)` � X 43 � � � e �) X 0 0 � 0, \ 01 1 0 "� � O s � O h X 03 � O 1 � 0 c � O °1 � �O � '1\ \ '1'l '1"� � ,ti� � ,1'" 1 ' 1 � 'L � 'L � 'L � 'L � 'L � 'L `1 el q °1 °1 °1 °f °f el q 4 °r 4 °J 4 4 q q °1 °1 °i °i °1 °1 °1 °1 ■ Plan Year End IIII Change in Employer Cost Rate —0 Cumulative Change ■ ■ The fund earnings and salary increase assumptions have considerable impact on the cost of the Plan so it is El important that they are in line with the actual experience. The following table shows the actual fund earnings and II salary increase rates compared to the assumed rates for the last few years: II M 1 11 11 1 II M ■ GRS 11 15 III HISTORY OF INVESTMENT EARNINGS AND SALARY INCREASES ill Investment Return Salary Increases II 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 III 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 11.5 10.00 6.8 10.0 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 III 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 * 6.3 9/30/1998 12.9 8.00 4.6 6.3 III 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 6.1 III 9/30/2008 4.2 8.00 13.1 6.1 9/30/2009 2.8 8.00 9.3 6.1 II 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 ■ 9/30/2014 8.9 7.75 1.0 5.8 9/30/2015 7.5 7.75 8.6 5.8 . Averages 7.9 % - -- 8.7 % - -- III The actual investment return rates shown above are based on the actuarial value of assets. The actual salary ■ increase rates shown above are the increases received by those active members who were included in the actuarial III valuations both at the beginning and the end of each year. ■ GRS ■ • ■ ■ 16 III ■ History of Investment Return Based on Actuarial Value of Assets 11 18% - - 18% • 13% - A 13% f ' ' ' ^ - ,-- /utak . a _ III 3% y 7 = 3% 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 II 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1, IIII —2% - - -2% II -7% - ---_ -7% NrIo <1 .� < < ∎ < L , ) <I, < I , `L, \ ' ) . � q4 4 �� 4 ��q��o��o��O��o��o��O��O��O��O��Oq�o ° l � 0° 1 �1, � � 1 ° 1 �� ° 1 � * ° 1 * II Plan Year End --IF Actual —to-- Assumed ■ ■ II History of Salary Increases ■ 25% : •. 25% • 20% - = 20% ■ 15% - ilk -: 15% III NI V ^ = 10% Ino 5% III 0% _ 1 I 1 1 I I I 1 I 1 I 1 1 I 1 1 ' I 1 1 I 0% 1 I 1 I I I 1 I y ° .. 11 1 , ■• , , "- ,fAii„ , . . . A, , • _5% - - -5 1 � \ \ r no \��4�� r \ ,� \ \ \ y \ - \ q ��q q \ q �� \1 \ q q \ q q \ q ��o��O��o� \ o��o��O��o� �o � \ti \N V \ \ ' ti \ ti p III ■ Plan Year End Compared to Previous Year Actual --- Assumed ■ III ■ i GRS IS . 5 17 5 5 5 Actual (A) Compared to Expected (E) Decrements 5 Among Active Employees ■ Number ■ Added Service & Active III DROP Disability Terminations Members Year Year Retirement Retirement Death Vested Other Totals End of II 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 1111 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 1111 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 1111 9/30/2007 17 4 3 3 0 0 0 0 0 1 1 11 144 1111 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 III 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 II 9/30/2014 5 7 2 1 0 0 0 0 2 3 5 6 139 9/30/2015 9 11 3 2 1 0 0 0 4 3 7 4 137 9/30/2016 1 0 0 4 13 Yr Totals * 159 144 53 30 1 0 0 0 23 67 90 119 . ■ * Totals are through current Plan Year only. 5 5 ■ ■ 5 5 5 5 5 II GRS il ■ • 18 N • SUPPLEMENTAL PENSION DISTRIBUTION . Cumulative Actuarial Gains (Losses) Balance at II Year Ending Beginning Gain (Loss) Supplemental Balance at . 9/30 of Year Interest for Year Payment End of Year II 2000 $ 0 $ 0 $ 1,596,887 $ 0 $ 1,596,887 2001 1,596,887 135,735 (1,978,307) 0 (245,685) 111 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) • 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) • 2014 (39,409,969) (3,054,273) 2,463,259 0 (40,000,983) III 2015 (40,000,983) (3,100,076) (1,896,466) 0 (44,997,525) 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 II amount for a supplemental payment to occur. III II II III Ill Ill = III II ■ GRS 11 2 ..k..) Cl) RECENT HISTORY OF VALUATION RESULTS Number of Actuarial Employer Normal Cost Valuation Active Inactive Covered Actuarial Value Accrued Funded % of Date Members Members Annual Payroll of Assets Liability UFAAL Ratio Amount Payroll 10/1/00 124 56 $ 6,907,740 $ 32,559,614 $ 33,726,879 $ 1,167,265 96.5 % $ 464,164 6.72 % 10/1/01 122 75 6,555,316 34,331,760 37,715,963 3,384,203 91.0 726,204 11.08 10/1/02 119 75 7,382,088 32,133,373 40,604,148 8,470,775 79.1 1,538,895 20.85 10/1/03 124 81 7,917,021 33,206,438 44,029,168 10,822,730 75.4 1,935,704 24.45 10/1/04 109 94 7,207,008 34,495,794 48,154,162 13,658,368 71.6 2,043,434 28.35 10/1/05 116 96 7,836,390 35,445,474 56,691,347 21,245,873 62.5 1,238,339 15.80 10/1/06 131 100 9,302,405 37,691,909 61,468,267 23,776,358 61.3 1,441,317 15.49 10/1/07 144 103 10,296,812 41,981,125 66,068,756 24,087,631 63.5 1,587,552 15.42 10/1/08 149 104 11,532,888 44,277,726 72,349,643 28,071,917 61.2 1,774,031 15.38 10/1/09 151 107 12,537,968 46,116,985 78,055,403 31,938,418 59.1 1,931,395 15.40 10/1/10 148 109 12,134,525 48,129,593 81,957,204 33,827,611 58.7 1,895,893 15.62 10/1/11 144 113 12,397,266 49,115,728 89,656,412 40,540,684 54.8 2,126,920 17.16 10/1/12 146 116 11,789,237 52,594,653 91,924,429 39,329,776 57.2 2,114,509 17.94 10/1/13 141 122 11,302,523 56,693,338 95,951,447 39,258,109 59.1 2,132,984 18.87 10/1/14 139 123 11,142,832 62,320,013 99,965,363 37,645,350 62.3 2,214,983 19.88 10/1/15 137 130 11,774,623 67,380,705 106,464,806 39,084,101 63.3 2,425,913 20.60 1 ■ ■ ■ ■ ■ ■ ■ ■ ■ Ill ■ III ■■ ■ ■ ■ ■ ■ ■ ■ ■ ■■ ■ ■ ■ ■ ■ ■ III ■ ■ ■ ■ ■ ■ ■ ■■ ■■■■■■■■■■■■■■■■■■■■■■■■ 2 1 RECENT HISTORY OF REQUIRED AND ACTUAL CONTRIBUTIONS Cr) End of Required Contributions Year To Employer & State Estimated State Net Employer Actual Contributions Valuation Which - Valuation % of % of % of Applies Amount Payroll Amount Payroll Amount Payroll Employer State Total 10/1/98 9/30/99 863,996 13.88 427,874 6.87 436,122 7.01 426,129 427,874 854,003 10/1/99 9/30/00 920,372 12.92 427,874 6.00 492,498 6.92 490,425 429,945 920,370 10 /1 /00 9/30/01 742,646 10.75 429,945 6.22 312,701 4.53 312,701 430,572 743,273 10/1/01 9/30/02 1,053,863 16.08 443,454 6.77 610,409 9.31 610,409 443,454 1,053,863 10/1/02 9/30/03 1,929,458 26.14 443,454 6.01 1,486,004 20.13 1,486,004 465,087 1,951,091 10/1/03 9/30/04 2,343,601 29.60 465,087 5.87 1,878,514 23.73 1,878,514 465,087 2,343,601 10/1/04 9/30/05 2,571,109 35.67 465,087 6.45 2,106,022 29.22 2,106,022 465,087 2,571,109 10/1/05 9/30/06 2,808,957 35.85 465,087 5.93 2,343,870 29.92 2,343,870 465,087 2,808,957 10/1/06 9/30/07 3,030,547 32.58 465,087 5.00 2,565,460 27.58 2,685,841 465,087 3,150,928 10/1/07 9/30/08 3,236,241 31.43 465,087 4.52 2,771,154 26.91 2,771,154 465,087 3,236,241 10/1/08 9/30/09 3,710,169 32.17 465,087 4.03 3,245,082 28.14 3,245,082 465,087 3,710,169 10/1/09 9/30/10 4,153,603 33.13 465,087 3.71 3,688,516 29.42 3,688,516 465,087 4,153,603 10/1/09 9/30/11 3,997,173 31.78 465,087 3.70 3,532,086 28.08 3,552,348 465,087 4,017,435 10 /1 /10 9/30/12 4,098,955 32.55 465,087 3.69 3,633,868 28.86 3,633,868 465,087 4,098,955 10/1/11 9/30/13 4,701,572 36.68 465,087 3.63 4,236,485 33.05 4,236,485 465,087 4,701,572 10/1/12 9/30/14 4,560,918 38.54 465,087 3.93 4,095,831 34.61 4,159,736 465,087 4,624,823 10/1/13 9/30/15 4,830,346 41.73 465,087 4.02 4,365,259 37.71 4,365,259 465,087 4,830,346 10/1/14 9/30/16 4,856,392 42.26 465,087 4.05 4,391,305 38.21 na na na 10/1/15 9/30/17 5,256,615 43.16 465,087 3.82 4,791,528 39.34 na na na N O ■ 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; . (ii) 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 o Assets - T he Actuarial A tuarial Value of Assets base in the difference between the expected p P 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% er year, compounded annually (net p Y p y ( after ■ investment expenses). ■ The Wage Inflation Rate assumed in this valuation was 3% 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 4.75 %. ■ ■ ■ GRS ■ III ■ 22 ■ The rates of salary increase are as follows: IIII Increase in Salary ■ Age Merit and Base Total Seniority (Economic) Increase ■ 20 3.5% 3.0% 6.5% III 30 3.5% 3.0% 6.5% 30 3.5% 3.0% 6.5% ■ 35 3.5% 3.0% 6.5% 40 2.5% 3.0% 5.5% II 45 2.0% 3.0% 5.0% ■ 50 2.0% 3.0% 5.0% 55 2.0% 3.0% 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 u oses of financing the unfunded liabilities, total payroll is assumed to p rp g p yr 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 4.16 %. iii Demographic Assumptions II IIII The mortality table is the RP -2000 Mortality Table for annuitants with future improvements in mortality projected to all future years using Scale BB. For females, the base mortality rates include a 100% white ■ collar adjustment. For males, the base mortality rates include a 90% blue collar adjustment and a 10% white collar adjustment. These are the same rates currently in use for Special Risk Class members of the ■ Florida Retirement System (FRS) (and they are based on a statewide experience study). ■ FRS Healthy Mortality for Special Risk Class Members • Sample Probability of Future Life ■ Attained Dying Next Year Expectancy (years) Ages (in 2015) Men Women Men Women • 50 0.54 0.23 % 33.67 38.11 III 55 0.67 0.32 29.02 33.09 60 0.91 0.48 24.45 28.20 II 65 1.34 0.76 20.05 23.46 I. 70 2.07 1.27 15.95 19.02 75 3.36 2.15 12.25 14.96 . 80 5.53 3.59 9.08 11.36 Il This assumption is used to measure the probabilities of each benefit payment being made after retirement. IIII For active members, the probabilities of dying before retirement were based upon the same mortality table III as members dying after retirement (75% of deaths are assumed to be service - connected). 11 GRS IIII 23 ■ IIII For disabled retirees, the mortality table used was 60% of the RP -2000 mortality and 40% of the RP2000 Mortality with a White Collar adjustment for disabled annuitants, set -back 4 years for males and set - forward 2 years for females, with no provision being made for future mortality improvements. These are the same rates currently in use for Special Risk Class members of the Florida Retirement System (FRS) III (and they are based on a statewide experience study). ■ FRS Disabled Mortality for Special Risk Class Members ■ Sample Probability of Future Life ■ Attained Dying Next Year Expectancy (years) Ages Men Women Men Women III 50 1.67 0.91 % 23.74 27.06 ■ 55 2.03 1.26 20.77 23.37 60 2.47 1.67 17.91 19.90 . 65 3.07 2.24 15.15 16.62 70 3.90 3.18 12.52 13.58 III 75 5.30 4.60 10.02 10.86 ■ 80 7.59 6.66 7.80 8.48 For the prior year's valuation, the mortality assumption for healthy members was 80% of the RP -2000 Combined Healthy Participant Mortality Table for males and females with mortality improvement projected III to all future years after 2000 using Scale AA, and 20% of the 1983 Group Annuity Mortality Table for males and females. For disabled members, the same tables were used with ages set forward 5 years to reflect IIII 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 Years III After First Eligibility Probability of . for Normal Retirement Normal Retirement 0 40 % . 1 10 % III 10% 3 10 % ■ 4 10 % 5 10 % III 6 10 % ■ 7 100 % II III IIII IIII III II GRS NI II ■ 24 ■ Rates of separation from active membership are 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 have now been fully ■ phased in from the previous rates (shown below) after a five -year phase in. This assumption measures the probabilities of members remaining in employment. II II of Sample % of Active Members of Service Ages Separating Within Next Year ■ 0 - 1 ALL 15.0% 1 - 2 10.0% II 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 (Fully Phased Out as of October 1, 2015) ■ Sample % of Active Members ■ Ages Separating Within Next Year III 25 20.0% 25 17.0% ■ 30 13.2% 35 8.0% • 40 0.0% . 45 0.0% 50 0.0% II 55 0.0% III Rates of disability among active members (90% of disabilities are assumed to be service connected). III 111 Ages % Becoming Disabled Ages within Next Year ■ 20 0.14 25 0.15% II 30 0.18 . 35 0.23 % 40 0.30 % ■ 45 0.51 % II 50 1.00 % II 55 1.55 % 1 II 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 11 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 (APT) 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, such as the Funded Ratio and theActuarially . Determined Contribution (ADC). 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 Determined contribution (ADC). • Amortization Method A method for determining the Amortization Payment. The most common methods used are level dollar and level percentage of payroll. Under the 111 payments, 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 III 27 IIII one of a stream of increasing payments, whose Actuarial Present Value is III 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 III all active members is assumed to increase. II 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. III Amortization Period The period used in calculating the Amortization Payment. 11 Actuarially Determined The employer' s periodic required contributions, expressed as a dollar III Contribution (ADC) amount or a percentage of covered plan compensation, determined under . GASB. The ARC consists of the Employer Normal Cost and Amortization Payment. IIII 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 III end of two years, etc. II 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. IIII Equivalent Single For plans that do not establish separate amortization bases (separate II 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 III over which the UAAL would be amortized if all amortization bases were II upon the current UAAL payment. Experience Gain /Loss A measure of the difference between actual experience and that expected IIII based upon a set of Actuarial Assumptions, during the period between two II actuarial valuations. To the extent that actual experience differs from that assumed, Unfunded Actuarial Accrued Liabilities emerge which may be III 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 liabilities 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. III Funded Ratio The ratio of the Actuarial Value of Assets to the Actuarial Accrued Liability. GASB Governmental Accounting Standards Board. II GASB No. 68 and These are the governmental accounting standards that set the accounting II GASB No. 67 rules for public retirement systems and the employers that sponsor or I contribute to them. Statement No. 68 sets the accounting rules for the employers that sponsor or contribute to public retirement systems, while ■ Statement No. 67 sets the rules for the systems themselves. II GRS II ■ ■ ■ 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 Period each year. In theory, if an Open Amortization Period is used to amortize the Unfunded Actuarial ■ 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 III Item 2015 2014 III A. Cash and Cash Equivalents (Operating Cash) $ 8,692 $ 25,518 B. Receivables: 1. 1. Member Contributions $ - $ - IIII Employer Contributions - - 3. State Contributions - - NI 4. Buy -Back Installment Payments 62,976 59,307 ■ 5. Receivables for Securities Sold plus Prepaid Expenses 403,960 380,425 6. DROP Loans 299,439 238,163 ■ 7. Total Receivables $ 766,375 $ 677,895 . C. Investments III 2. Short-Term Investments $ - $ - 2. Domestic Equities (Large cap defensive) 20,005,118 19,631,376 ■ 3. Real Estate 6,259,818 4,181,355 4. Multi -Asset Core Fund (Equities) 29,668,247 29,300,544 II 5. Multi- Manager Bond Fund (Fixed Income) 21,709,238 22,669,808 ■ 6. Total Investments $ 77,642,421 $ 75,783,083 D. Liabilities and Reserves III 1. Benefits Payable $ - $ - ■ 2. Accrued Expenses and Other Payables (144,804) (145,124) 3. Total Liabilities and Reserves $ (144,804) $ (145,124) ■ E. Total Market Value of Assets Available for Benefits $ 78,272,684 $ 76,341,372 ■ F. Reserves ■ 1. State Contribution Reserve $ (94,604) $ (69,784) ■ 2. DROP Accounts (9,570,232) (8,497,374) 3. Supplemental Benefit Reserve (1,929,660) (2,062,812) • $ (11,594,496) $ (10,629,970) ■ G. Market Value Net of Reserves $ 66,678,188 $ 65,711,402 ■ H. Allocation of Investments 1. Short-Term Investments 0.00% 0.00% II 2. Domestic Equities (Large cap defensive) 25.77% 25.90% ■ 3. Real Estate 8.06% 5.52% 4. Multi -Asset Core Fund (Equities) 38.21% 38.67% ■ 5. Multi - Manager Bond Fund (Fixed Income) 27.96% 29.91% III 6. Total Investments 100.00% 100.00% Il II II GRS II 30 11 PENSION FUND DISBURSEMENTS & INCOME II IN September 30 ■ Item 2015 2014 of Year IN Market Value of Assets at Beginning $ 76,341,372 $ 69,081,790 B. Revenues and Expenditures 1. Contributions In a. Employee Contributions $ 924,289 $ 885,669 ■ b. Employer Contributions 4,365,259 4,159,736 c. State Contributions 675,227 645,579 11 d. Buy Back Contributions 116,586 25,706 ■ e. Health Subsidy Contributions - - f. DROP Rollover 78,814 28,186 ■ g. Change in Value of Remaining Buy Back Payments 3,669 5,483 h. Total $ 6,163,844 $ 5,750,359 II 2. Investment Income II a. Interest, Dividends, and Other Income $ 10,164 $ 1,060 R b. Net Realized Gains /(Losses) 1,752,200 1,142,185 ■ c. Net Unrealized Gain/(Losses) 243,898 6,576,880 d. Investment Expenses 577 798 (565,922) e. Net Investment Income ( ) II 1,428,464 $ 7,154,203 ■ 3. Benefits and Refunds ■ a. Refunds $ (69,179) $ (42,665) b. Regular Monthly Benefits to Retirees (4,426,102) (4,597,183) III c. Supplemental Distributions and DROP Loans (486,239) - ■ d. DROP Distributions (526,372) (880,006) e. Total $ (5,507,892) $ (5,519,854) ■ 4. Administrative and Miscellaneous Expenses $ (153,104) $ (125,126) ■ 5. Transfers $ - $ - ■ C. Market Value of Assets at End of Year $ 78,272,684 $ 76,341,372 . D. Reserves ■ 1. State Contribution Reserve $ (94,604) $ (69,784) ■ 2. DROP Accounts (9,570,232) (8,497,374) 3. Supplemental Benefit Reserve (1,929,660) (2,062,812) 11 4. Total Reserves $ (11,594,496) $ (10,629,970) ■ E. Market Value Net of Reserves $ 66,678,188 $ 65,711,402 ■ II GRS II • . . . . ■ ■ . . . . . . . . ■ ■ • i . . . ■ . • . ■ ■ . . . . 2 ACTUARIAL VALUE OF ASSETS Valuation Date — September 30 2014 2015 2016 2017 2018 2019 A. Actuarial Value of Assets Beginning of Year $ 66,874,278 $ 72,949,983 $ - $ - $ - $ - B. Market Value End of Year 76,341,372 78,272,684 - - - - C. Market Value Beginning of Year 69,081,790 76,341,372 - - D. Non - Investment /Administrative Net Cash Flow 105,379 502,848 E. Investment Income El. Actual Market Total: B -C -D 7,154,203 1,428,464 - E2. Assumed Rate of Return 7.75% 7.75% 7.75% 7.75% 7.75% 7.75% E3. Assumed Amount of Return 5,186,840 5,673,109 E4. Amount Subject to Phase -In: E1 —E3 1,967,363 (4,244,645) - - _ - F. Phase -In Recognition of Investment Income Fl. Current Year: 0.2 x E4 393,473 (848,929) - - _ F2. First Prior Year 265,985 393,473 (848,929) - - - F3. Second Prior Year 980,811 265,985 393,473 (848,929) - - F4. Third Prior Year (942,079) 980,811 265,985 393,473 (848,929) - F5. Fourth Prior Year 85,296 (942,079) 980,811 265,985 393,472 (848,929) F6. Total Phase -Ins 783,486 (150,739) 791,340 (189,471) (455,457) (848,929) G. Actuarial Value of Ass ets End of Year Gl. Preliminary Actuarial Value of Assets: $ 72,949,983 $ 78,975,201 $ - $ - $ - $ - G2. Upper Corridor Limit: 120 % *B 91,609,646 93,927,221 - - - - G3. Lower Corridor Limit: 80 % *B 61,073,098 62,618,147 - - - - G4. Funding Value End of Year 72,949,983 78,975,201 - - - - G5. Less: State Contribution Reserve (69,784) (94,604) - - _ - G6. Less: DROP Account Balances (8,497,374) (9,570,232) - - _ - G7. Less: Supplemental Benefit Reserve (2,062,812) (1,929,660) - - - G8. Final Funding Value End of Year 62,320,013 67,380,705 - - - _ H. Difference between Market & Actuarial Value $ 3,391,389 $ (702,517) $ - $ - $ - $ - I. Actuarial Rate of Return 8.92% 7.54% 0.00% 0.00% 0.00% 0.00% J. Market Value Rate of Return 10.35% 1.87% 0.00% 0.00% 0.00% 0.00% K Ratio of Actuarial Value to Market Value 95.56% 100.90% 0.00% 0.00% 0.00% 0.00% L..) ■ 32 ■ ■ ■ RECONCILIATION OF DROP ACCOUNTS ■ ■ Value at beginning of year $ 8,497,374 ■ Adjustment to beginning of year balances + 146,028 ■ Payments credited to accounts + 778,851 ■ Rollovers into DROP account + 78,814 ■ Investment Earnings credited + 626,450 ■ Withdrawals from accounts - 526,372 ■ Loan Proceeds - 154,000 ■ Loan P ayments + 123,087 ■ Value at end of year 9,570,232 ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ GRS ■ II ■ 33 a ■ 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 I 111 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 II 9/30/08 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 II 9/30/11 (0.6) 1.6 ■ 9/30/12 18.0 6.9 9/30/13 9.8 7.0 . 9/30/14 10.3 8.9 9/30/15 1.9 7.5 Ell Average Returns: ■ Last Five Years 7.7 % 6.4 % Last Ten Years 5.0 % 5.7 % NI All Years 8.5 % 8.0 % II 111 GRS • • • • • • • • SECTION D • FINANCIAL ACCOUNTING INFORMATION • • • • • • • • • • • • • • • • • • • • • • • GRS • IIII . 34 II In FASB NO. 35 INFORMATION 11 A. Valuation Date October 1, 2015 October 1, 2014 II B. Actuarial Present Value of Accumulated IN Plan Benefits ■ 1. Vested Benefits ■ a. Members Currently Receiving Payments $ 59,949,063 $ 56,897,000 b. Terminated Vested Members 1,655,681 1,115,450 • c. Other Members 31,909,764 30,086,448 ■ d. Total 93,514,508 88,098,898 ■ 2. Non - Vested Benefits 589,912 502,412 ■ 3. Total Actuarial Present Value of Accumulated Plan Benefits: ld + 2 94,104,420 88,601,310 ■ 4. Accumulated Contributions of Active Members 7,050,516 6,800,856 ■ C. Changes in the Actuarial Present Value of • Accumulated Plan Benefits II 1. Total Value at Beginning of Year 88,601,310 84,102,687 II 2. Increase (Decrease) During the Period . Attributable to: ■ a. Plan Amendment 0 0 b. Change in Actuarial Assumptions 14,887 753,424 . c. Latest Member Data, Benefits Accumulated III d. Decrease in the Discount Period 10,762,355 9,286,287 d. Benefits Paid (Net basis, including credits ■ to DROP accounts) (5,274,132) (5,541,088) e. Net Increase 5,503,110 4,498,623 II 3. Total Value at End of Period 94,104,420 88,601,310 • ■ D. Market Value of Assets 66,678,188 65,711,402 ■ E. Actuarial Assumptions - See page entitled Actuarial Assumptions and Methods • II II 11 GRS 11 II 35 ■ SCHEDULE OF CHANGES IN THE EMPLOYER'S ■ NET PENSION LIABILITY AND RELATED RATIOS GASB Statement No. 67 II III Fiscal year ending September 30, 2016* 2015 2014 ■ Total pension liability ■ Service Cost $ 3,047,445 $ 2,767,701 $ 2,809,815 Interest 9,090,156 8,679,595 8,234,704 1111 Benefit Changes - - - Difference between actual & expected experience 1,820,086 (1,776,804) (129,636) II Assumption Changes (565,994) 617,426 - ■ Benefit Payments (5,418,051) (5,438,713) (5,477,189) Refunds (10,154) (69,179) (42,665) Other (Adjustments to Reserves) - 395,891 255,655 II Net Change in Total Pension Liability 7,963,488 5,175,917 5,650,684 Total Pension Liability - Be ginning 116,958,988 111,783,071 106,132,387 • Total Pension Liability - Ending (a) $ 124,922,476 $ 116,958,988 $ 111,783,071 ■ Plan Fiduciary Net Position Contributions - Employer (from City) $ 4,391,305 $ 4,365,259 $ 4,159,736 Contributions - Employer (from State) 675,227 675,227 645,579 IN Contributions - Non - Employer Contributing Entity - - - Contributions - Member 824,224 1,040,875 911,375 ■ Net Investment Income 6,224,325 1,428,464 7,154,203 MI Payments (5,418,051) (5,438,713) (5,477,189) Refunds (10,154) (69,179) (42,665) Expense II Ex p (139,115) (153,104) (125,126) Other 78,814 28,186. II Net Change in Plan Fiduciary Net Position 6,547,761 1,927,643 7,254,099 ■ Plan Fiduciary Net Position - Beginning 78,209,708 76,282,065 69,027,966 Plan Fiduciary Net Position - Ending (b) $ 84,757,469 $ 78,209,708 $ 76,282,065 ■ Net Pension Liability - Ending (a) - (b) 40,165,007 38,749,280 35,501,006 111 Plan Fiduciary Net Position as a Percentage of Total Pension Liability 67.85 % 66.87 % 68.24 % ■ Covered Employee Payroll $ 13,000,000 12,919,713 $ 12,478,996 Net Pension Liability as a Percentage ■ of Covered Employee Payroll . 308.96 % 299.92 % 284.49 % ■ * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. II II III III GRS 11 ■ ■ 36 ■ 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 % of September 30, Liability Position Liability Pension Liability Payroll Covered Payroll ■ 2014 $111,783,071 $ 76,282,065 $ 35,501,006 68.24% $ 12,478,996 284.49% • 2015 116,958,988 78,209,708 38,749,280 66.87% 12,919,713 299.92% ■ 2016* 124,922,476 84,757,469 40,165,007 67.85% 13,000,000 308.96% ■ * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. ■ ■ ■ ■ ■ ■ �I ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ GRS ■ ■ 37 NOTES TO NET PENSION LIABILITY ■ GASB Statement No. 67 ■ Valuation Date: October 1, 2015 ■ Measurement Date: September 30, 2016 Methods and Assumptions Used to Determine Net Pension Liability: ■ Actuarial Cost Method Entry Age Normal ■ Inflation 3.0% 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 RP -2000 Mortality Table for Annuitants with mortality improvement projected to all future years using Scale BB. For females, the base mortality ■ rates include a 100% white collar adjustment. For males, the base mortality ■ rates include a 90% blue collar adjustment and a 10% white collar adjustment. These are the same rates currently in use for Special Risk Class members of the Florida Retirement System (FRS). Other Information: Notes See Discussion of Valuation Results. ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ GRS ■ ■ ■ 38 SCHEDULE OF CONTRIBUTIONS GASB Statement No. 67 ■ Actuarially Contribution Actual Contribution I ' i ■ FY Ending Determined Actual Deficiency Covered as a % of September 30, Contribution Contribution (Excess) Payroll Covered Payroll 2014 $ 4,560,918 $ 4,624,823 $ (63,905) $ 12,478,996 37.06% 2015 4,830,346 4,830,346 - 12,919,713 37.39% 2016* 4,856,392 4,856,392 - 13,000,000 37.36% * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. ■ ■ • 1 • ■ ■ ■ ■ ■ ■ ■ • ■ ■ GRS 1 39 1 NOTES TO SCHEDULE OF CONTRIBUTIONS 1 GASB Statement No. 67 Valuation Date: October 1, 2014 ■ Notes Actuarially determined contribution rates are calculated as of October 1, which is two year(s) prior to the end of the fiscal year in 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 22 years Asset Valuation Method 5 -year smoothed market ■ Inflation 3.0% ■ 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 80% RP -2000 Combined Healthy Participant Mortality Table for males and females with mortality improvement projected to all future years after 2000 using Scale AA; 20% 1983 Group Annuity Mortality Table for males and females. Other Information: See Discussion of Valuation Results in the October 1, 2014 Actuarial ■ Notes Valuation Report. 1 1 1 ■ 1 1 ■ 1 ■ GRS ■ ■ 40 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% $ 53,657,499 $ 40,165,007 $ 28,906,647 R * These figures are estimates only. Actual figures will be provided after the end of the fiscal year. ■ ■ ■ ■ ■ ■ ■ • ■ GRS ■ • • • • • • • • SECTION E • MISCELLANEOUS INFORMATION • • • • • • • • • • • • • • • • • • • • • GRS • II ■ 41 III ■ RECONCILIATION OF MEMBERSHIP DATA ■ From 10/1/14 From 10/1/13 To 10/1/15 To 10/1/14 • A. Active Members al 1. Number Included in Last Valuation 139 141 . 2. New Members Included in Current Valuation 9 5 3. Non - Vested Employment Terminations (3) (3) III 4 . Vested Employment Terminations (4) (2) ■ 5. DROP Participation (3) (2) 6. Service Retirements 0 0 ■ 7. Disability Retirements (1) 0 8. Deaths 0 0 • 9. Number Included in This Valuation 137 139 III B. Terminated Vested Members • III 1. Number Included in Last Valuation 7 6 III 3. 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- -Data Correction 1 0 ■ 7. Number Included in This Valuation 10 7 II C. DROP Plan Members II 2. Number Included in Last Valuation 11 12 2. Additions from Active Members 3 2 III 3. Retirements (5) (3) 4. Deaths Resulting in No Further Payments 0 0 • 5. Other 0 0 ■ 6. Number Included in This Valuation 9 11 IN D. Service Retirees, Disability Retirees and Beneficiaries III 1. Number Included in Last Valuation 105 104 2. Additions from Active Members 1 0 ■ 3. Additions from Terminated Vested Members 1 0 4. Additions from DROP Plan 5 3 II 5. Deaths Resulting in No Further Payments (1) (2) ■ 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 111 105 ill 111 GRS Ill 42 ■ ACTIVE PARTICIPANT SCATTER ■ • Years of Service to Valuation Date II Group 0 -1 1 -2 2 -3 3 -4 4 -5 5 -9 10 -14 15 -19 20 -24 25+ Totals 20 -24 NO. 0 0 0 0 0 0 0 0 0 0 0 a 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 ■ 25 -29 NO. 5 0 1 2 4 2 0 0 0 0 14 II TOT PAY 279,242 0 63,501 134,850 244,837 145,538 0 0 0 0 867,968 II PAY 55,848 0 63,501 67,425 61,209 72,769 0 0 0 0 61,998 30 -34 NO. 1 1 0 2 0 17 4 0 0 0 25 III TOT PAY 53,908 60,900 0 128,539 0 1,276,067 376,154 0 0 0 1,895,568 5 AVG PAY 53,908 60,900 0 64,270 0 75,063 94,039 0 0 0 75,823 s 35 -39 NO. 1 0 1 1 1 9 14 2 0 0 29 TOT PAY 53,908 0 63,390 60,674 77,646 669,095 1,198,752 200,352 0 0 2,323,817 . AVG PAY 53,908 0 63,390 60,674 77,646 74,344 85,625 100,176 0 0 80,132 III 40 -44 NO. 2 1 0 0 0 2 14 16 0 0 35 ■ TOT PAY 184,097 73,730 0 0 0 130,420 1,250,679 1,751,543 0 0 3,390,469 AVG PAY 92,049 73,730 0 0 0 65,210 89,334 109,471 0 0 96,871 5 45 -49 NO. 0 0 0 0 0 3 12 8 0 0 23 ■ TOT PAY 0 0 0 0 0 194,537 1,019,858 850,156 0 0 2,064,551 AVG PAY 0 0 0 0 0 64,846 84,988 106,270 0 0 89,763 111 50 -54 NO. 0 1 0 0 0 2 3 2 0 0 8 5 TOT PAY 0 59,006 0 0 0 120,179 241,487 241,355 0 0 662,027 ■ AVG PAY 0 59,006 0 0 0 60,090 80,496 120,678 0 0 82,753 55 -59 NO. 0 0 0 0 0 1 0 2 0 0 3 II TOT PAY 0 0 0 0 0 65,509 0 202,232 0 0 267,741 1111 AVG PAY 0 0 0 0 0 65,509 0 101,116 0 0 89,247 ■ 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. 9 3 2 5 5 36 47 30 0 0 137 ■ TOT AMT 571,155 193,636 126,891 324,063 322,483 2,601,345 4,086,930 3,245,638 0 0 11,472,141 II AMT 63,462 64,545 63,446 64,813 64,497 72,260 86,956 108,188 0 0 83,738 ■ 5 GRS IN III • ■ 43 II INACTIVE PARTICIPANT SCATTER III Deceased with ■ Terminated Vested Disabled Retired Beneficiary Total Total Total Total 1 • Age Group Number Benefits Number Benefits Number Benefits Number Benefits . Under 20 - - - - - - - - 20 -24 - - - - - - - - ■ 25 -29 - - - - - - - - III 30 -34 4 79,656 - - - - - - 35 -39 4 90,805 - - - - - - ■ 40 -44 2 63,895 1 41,698 1 69,648 - - II 45 -49 - - - - 13 835,855 - - III 50 -54 - - - - 21 1,111,175 1 23,843 55 -59 - - 4 83,217 31 1,561,526 - - III 60 -64 - - 3 61,035 15 626,161 - • 65 -69 - - 3 78,232 12 506,659 1 9,397 I ■ 70 -74 - - 3 40,948 8 206,460 - - 75 -79 - - - - 2 75,392 - - III 80 -84 - - - - 1 27,637 - - 85 -89 - - - - - - - - III 90 -94 - - - - - - - - 95 -99 - - - - - - - - III 100 &Over - - - - - - - - III Total 10 234,356 14 305,130 104 5,020,513 2 33,240 Average Age 37 62 59 59 III II IIII III III III ■ r IN II IS GRS • • • • • • SECTION F • SUMMARY OF PLAN PROVISIONS • • • • • • • • • • • • • • • • • • • • • • • GRS ■ 44 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.15 -022 passed and adopted on its second reading on September 3, 2015. The Plan is also governed by certain provisions of Chapter 185, Florida Statutes, Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. 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 Contributions 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 111 ■ 45 ■ 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. ■ g ■ Benefit: 3.5% of AFC multiplied by years of Credited Service for Members hired before ■ October 1, 2015. Benefit is limited to 100% of AFC and the provisions of Internal Revenue Code Section 415. ■ All Members hired on or after October 1, 2015 will receive 3.0% of AFC multiplied by years of Credited Service. Benefit is limited to 100% of AFC and the provisions ■ of the 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 are options a r also available. ■ COLA: None ■ ■ GRS ■ ■ ■ Supplemental 46 ■ 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. ■ 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 Security 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 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. ■ 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 ■ 47 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. ■ 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 ■ p g into 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. 11 GRS ■ ■ 48 ■ 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 in ■ 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 11 of Benefit: 10 Years Certain and Life thereafter; other options are also available. COLA: None ■ ■ GRS ■ 49 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. u GRS 50 X. Deferred Retirement Option Plan Eligibility: Plan members who have less than 30 years of Credited Service but have met one of the following criteria 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 %o 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. � G S R �Russell V / Investments Quarterly Inves Re City of Boynton Beach Police Retirement Fund FOURTH QUARTER 2015 Quarterly Investment Rev City of Boynton Beach Police Retirement Fund Your Client Service Team Mary Jean Serene, CFA Karen Pheneger Jacqueline Pedraza Michael Auger Client Executive Client Service Analyst Senior Account Executive Regional Director (877) 500 -1298 (800) 426 -7969 (800) 455 -3782 (312) 780 -7124 (206) 505 -1972 (206) 505 -1939 (813) 288 -4624 mjserene @russell.com kpheneger @russell.com jpedraza @russell.com mauger @russell.com Russell Investments Russell Investments Russell Investments Russell Investments 71 S. Wacker Drive, Suite 2040 1301 Second Avenue, 18th Floor 1301 Second Avenue, 18th Floor 15310 Amberely Drive Chicago, II 60606 Seattle, WA 98101 Seattle, WA 98101 Tampa, FL 33647 Fax (312) 780 -7159 Fax (206) 505 -1565 Fax (206) 505 -1565 Fax (813) 910 -7676 p.2 2 Russell Investments AN •••••••••••• •••••••••••••••••••••••• Important Information Russell Trust Company Funds are collective or commingled funds for which Russell Trust Company serves as trustee. They are not funds of Russell Investment Company, nor a mutual fund registered under the Investment Company Act of 1940. Russell Institutional Funds, LLC (RIFL) funds are not mutual funds, but are funds of the Russell Institutional Funds, LLC, they are private placements. An investment in the Russell Institutional Funds, LLC involves certain risks and considerations that prospective investors should evaluate before making a decision to invest. The information provided in this material is for the exclusive use of the recipient for the sole purpose of evaluating the Russell Institutional Funds, LLC private placement. The material may not be reproduced, provided or disclosed to others or used for any other purpose without prior written authorization. No investment may be made in any fund unless the investor has reviewed the Private Placement Memorandum ( "PPM ") and the PPM Supplement with respect to the particular fund(s) under consideration. Prospective investors should read all of the materials carefully before investing, and are advised to consult with their own legal, tax and financial advisers as to the consequences of an investment in any fund. Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns. Investments that are allocated across multiple types of securities may be exposed to a variety of risks based on the asset classes, investment styles, market sectors and size of companies preferred by the advisors. Investors should consider how the combined risks impact their total investment portfolio and understand that different risks can lead to varying financial consequences, including loss of principal. Diversification and strategic asset allocation do not assure profit or protect against loss in declining markets. Indexes and /or benchmarks are unmanaged and cannot be invested in directly. Past performance is not indicative of future results. Performance is gross of fees unless otherwise noted. Fees will reduce the overall performance of the fund. Only client account performance is reflective of actual investments from the client's investment inception date. Fund performance shown does not reflect individual client investment inception dates or other client specific actions such as contributions. Russell Investments and Standard & Poor's Corporation are owners of the trademark, service marks, and copyrights relating to the Russell Indexes and the S &P 500, respectively. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed or produced by MSCI. Source: BofA Merrill Lynch, used with permission. BofA Merrill Lynch is licensing the BofA Merrill Lynch Indices "as is ", makes no warranties regarding same, does not guarantee the quality, accuracy, and /or completeness of the BofA Merrill Lynch Indices or any data included therein or derived there from, and assumes no liability in connection with their use. Copyright© Russell Investments 2016. All rights reserved. This material is proprietary and may not be reproduced, transferred, or distributed in any form without prior written permission from Russell Investments. It is delivered on an "as is" basis without warranty. Russell Investments is a trade name and registered trademark of Frank Russell Company, a Washington USA corporation, which operates through subsidiaries worldwide and is part of London Stock Exchange Group. The Russell logo is a trademark and service of the Russell Investments. First used: August 2015; updated February 2016 USI -22695 08 -16 p.3 L] Russell Investments AN •••■••••••••••••••••••••••••••••••••••••••• Russell / Investments Russell update Fourth Quarter 2015 Russell update and events Fourth quarter 2015 Russell hosted event May 14 -17 — Russell Institutional Summit Scottsdale, AZ v b A t ri 2016 1/14U Investments MAY 14 -17, 2016 FOUR SEASONS RESORT SCOTTSDALE AT TROON NORTH Visit www.Russell.com /Summit for more information p.5 1 Russell Investments AIN � Russell V /IJ Investments Economic and financial markets review Fourth Quarter 2015 • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • ••••••••• Capital markets Periods ending December 31, 2015 CAPIT L MARKET RETURNS 20 14.7 15 12.2 10 6.3 5 ; 7.2 7.4 5 t 4.0 2.7 4.2 5.0 .8 3.7 3.3 13.8 4.6 4.5 4.7 i . -Ml 0.5 0.6 ■I �■ I MI MEE , _... Y I- -0.6 � A -0.6 -0 Er wam. W re - 5 2 .0 -4.7 -3.6 ____J u_ • U.S. Equity -6.4 p - 10 W -10.5 • Non - U.S. Developed Equity Q - - 12.5 -13.5 • Emerging Markets asp.... -20 -17.3 • U.S. Bonds • Global REITs - 25 - 24.7 Commodities - 30 4Q 2015 1 -Year 3 -Years 5 -Years 10 -Years ANNUALIZED U.S. Equity: (Russell 3000° Index) U.S. stock index which includes the Capital Markets: 3,000 largest U.S. stocks as measured by market capitalization > Federal Reserve awakens in December by raising rates 25 bps Non - U.S. Developed Equity: (Russell Developed ex -U.S. Large Cap , Equity markets rebounded from challenging 3Q 2015 Index) International market index that includes Western Europe, Japan, Australia and Canada > Emerging markets continue to be impacted by China, Brazil, strong Emerging Markets: (Russell Emerging Markets Index) Emerging U.S. dollar and weak commodity demand markets index that includes S. Korea, Brazil, Russia, India and China > Increased Fed Funds rate put pressure on U.S. bonds U.S. Bonds: (Barclays U.S. Aggregate Bond Index) Broad index for U.S. Fixed Income market , Global REITs finished up 4.2% in 4Q 2015 after two consecutive Global REITs: (FTSE EPRA/NAREIT Developed Real Estate Index) negative quarters Index for global publicly traded real estate securities > Commodities continue to be hurt by falling energy prices and global Commodities: (Bloomberg Commodity Index Total Return) Broad growth concerns index of common commodities Source: Russell, Barclays, Bloomberg, and FTSE NAREIT. Index returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. Russell Investments P.7 Indexes are unmanaged and cannot be invested in directly. AN Much ado about nothing Lots of global activity equals little result THE PATH OF $100 IN 2015 AUGUST 24th China devalues $105 yuan, Equities down 4 6.6% in single day $103 . $101 , , $101.38 $99 , EQUITIES PULLBACK 12% t t (June 22 — Aug 25th) ', \ ///' ) $97 EQUITIES UP 10% (Aug 25th — Dec 31St) 1 $95 \I . $93 41. $91 1/1/2015 2/1 /2015 3/1/2015 4/1/2015 5/1/2015 6/1/2015 7/1/2015 8/1/2015 9/1/2015 10/1/2015 11/1/2015 12/1 /2015 Represented by the S &P 500® Index. Morningstar. Index returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. Indexes are unmanaged and cannot be invested in directly. p.8 E] Russell Investments •••••••••••• ••••••••••••••••••••••••••••••• A year of moderation Russell 2016 annual global market outlook UNITED STATES EUROZONE ASIA- PACIFIC The Fed awakens Gas in the tank Waiting on hopes and fears > Forecast 2.5% GDP growth > Forecast 1.5 % -2% > China recession fears CO for 2016 GDP growth overblown 1— > Fed Funds rate to reach > Continued central bank > Commodities tempering Z 1.25 % -1.5% in 2016 monetary stimulus emerging market growth Q > U.S. Dollar strength expected > Expect 8 % -10% > Unconvincing economic 0- to peak in 2016 corporate earnings growth growth in Japan, but >- > Low to mid - single -digit total > Valuations attractive favorable equity LLI return forecast, with equity relative to U.S. valuations volatility in 1Q > Favored global equity market s F The bottom line: Diversification may help investors manage risks and capitalize on investment opportunities in 2016 There is no guarantee the stated expectations will be met. As of 12/20/2015 Forecasting represents predictions of market prices and /or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specific investment. p.9 E] Russell Investments �Russell V /�J Investments Russell's i nvestment process Fourth Quarter 2015 •••••••••••• ••••••••••••••••••••••• Systematically bringing you manager insight Ill The 4 P's of skillful manager research 12,958 TOTAL INVESTMENT PRODUCTS MONITORED w Are people or PEOPLE organizational advantages evident? 7 1- ' F INVESTMENT PRODUCTS �t � CONTINUALLY RESEARCHED "Ott," 'itt PROCESS Is process powerful 1, /z O :; 773 and distinctive? Vir INVESTMENT PRODUCTS WITH A PRIMARY "HIRE" RATING w > Is portfolio consistent /Fr 439 Q PORTFOLIO with expectations? INVESTMENT MANAGERS USED z ��.;, Is performance IN RUSSELL FUNDS indicative of skill? 0 135 Manager research & Voted tops for having best TOP DUE DILIGENCE 3 9 Countries covered by p g portfolio management manager due diligence '" MANAGER RESEARCH our research team g 2014 FUNDFIRE SURVEY Data as of 3/31/2015. Total Investment Products Monitored: is the total number of products listed in the database, including Alternatives products. Investment Products continually Researched is the number of products in the database with an active offering status where Russell has applied a defined rank (1,2,3,4,A,B,C,D), including Alternatives products. Investment Products with a primary 'Hire' Rating is the number of products in the database with an active offering status with a Hire (4) rank including Alternatives products. Investment Managers used in Russell Funds is the total number of Investment Managers with signed executed contracts as of the quarter -end reporting period. For a sixth year in a row, Russell was voted among the top two for having the best manager due diligence practices by respondents in a 2014 FundFire survey of nearly 100 consultant relations professionals. Russell was rated as having the most rigorous due diligence process for evaluating a product's suitability in a client portfolio. In five of those years, we were ranked #1. p.11 D2 Russell Investments ■ Building a responsive portfolio Positioning strategies enhance implementation skill 0 t CONSTRUCT �� M MANAGE 00 Y lir Manager allocation Market over time ( EV ....., s• ...... **. 4IV P 1 0 1 4 uam in Strategic positioning strategies O • ■ 111 ,� Ma Manager weight Dynamk changes changes strategies STRATEGIC PREFERRED DYNAMIC PREFERRED PORTFOLIO PORTFOLIO aro Or) .. ***. ..... .*** 0? 0 L45) .....1 id afil 4,,,, i llimail p.12 t Russell Investments Ai ••••••••••••••••••••••••••••••••••••••••••• Russell 1//AJ Investments Account review Fourth Quarter 2015 •••••••••••• ••••••••••••••••••••• RTC Multi -Asset Core Fund Asset allocation and advisor lineup as of December 31 2015 ASSET CATEGORY Global Equity Diversifying Fixed Cash Income 74.8% 6.1% 62% Global Equities Global ex US Equity US Large Cap Regional Small Cap Emerging Markets Global Real Estate Global Infrastructure Global Commodities US Agg Bonds Cash 48.5% 13.3% 8.3% 2.1% 2.6% 2.9% 5.1% 5.9% 6.1% 5.2% _ - ..._ — ADVISORS/STRATEGIES Harris Axiom SGA RTC Small Ca Fund RTC Emerging Mark- RTC Global Real Estate RTC Global RTC Quantltalve Bond p Fund Securities Fund Infrastructure Fund RTC Commodities Fund Fund Cash 3.5% 3.6% 8.3 °% 2.1% 2.6% 2.9% 5.1% 5.0% 6.1% 5 2% Kopemik MFS Ancora Advisors Alliance Bernstein Cohen & Steers Cohen &Steers CoreCommodity Neuberger Berman 3.5% 3.6% Perkins Polaris DePrince Axiom INVESCO Colonial First Credit Suisse 7.3°% 3.8°% Sanders Pzena EAM Delaware Morgan Stanley Lazard Gresham 7.0% 2.3% Wellington Falcon Point Harding Loevner Russell Trust Company Nuveen Russell Backwardation Strategy 6.3°% Russell Positioning Mount Lucas Strategies Nefols Genesis Management 20.8% 1.0% Robeco Numeric Snow Capital Oaktree Summit Creek Westwood Russell Positioning Strategies Allocations and Advisors /Funds /Strategies are as of December 2015. Current data may be different. The Russell Multi -Asset Core Fund is a dynamic, diversified portfolio designed to capture market opportunities. The underlying allocations to various asset classes will shift over time, but the overall strategic allocation will remain 75% global equity /15% marketable real assets /10% U.S. fixed income. This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. Russell positioning strategies are customized exposures directly managed by Russell for use within the total portfolio and may include overlays, index replication, smart beta strategies, and custom quantitative strategies. p.14 Investments © Russell InvestIYlents Asset Summary Report City of Boynton Beach Police Retirement Fund As of December 31, 2015 Market Actual Policy Holding Value Holding Holding Variance Boynton Beach Police Officers Retirement Trust Investment Account - QU7W Total Assets $ 83,370,726 100.00 % 100.00 % -- % RTC Multi -Asset Core Fund 32,073,560 38.47 39.00 -0.53 RTC Russell LC Defensive Equity Fd 21,433,405 25.71 26.00 -0.29 RTC Multi- Manager Bond Fund 23,040,911 27.64 28.00 -0.36 RTC Real Estate Equity Fund 1 6,418,948 7.70 7.00 0.70 Cash, Payable /Receivable 403,902 0.48 0.00 0.48 Please read the endnotes included with the report. Endnotes• 1 Market value is as of the quarter ending 12/31/15. 2- Feb -2016 6:57:49 AM EST Copyright (c) Russell Investments 2016. All rights reserved. p.15 Gi. Russell Investments •••••••••••• •••••••••••••••••••••• Market Value Reconciliation City of Boynton Beach Police Retirement Fund As of December 31, 2015 1 FYTD One Month Three Months Year to Date 09/30 Boynton Beach Police Officers Retirement Trust Investment Account - QU7W Beginning Market Value $ 84,312,006 $ 78,037,730 $ 81,540,326 $ 78,037,730 Inflows 115,007 4,739,689 6,406,672 4,739,689 Outflows - 401,560 - 1,788,883 - 6,418,556 - 1,788,883 Net Inflows /Outflows - 286,553 2,950,805 - 11,885 2,950,805 Appreciation /Depreciation - 654,711 2,382,159 1,842,254 2,382,159 Income Earned -16 31 31 31 Net Market Gain /Loss - 654,727 2,382,190 1,842,285 2,382,190 Ending Market Value 83,370,726 83,370,726 83,370,726 83,370,726 2- Feb -2016 6:57:49 AM EST Copyright (c) Russell Investments 2016. All rights reserved. p.16 1] Russell Investments All Performance Report City of Boynton Beach Police Retirement Fund As of December 31, 2015 Annualized Market One Three Year to FYTD One Three Five Ten Since Inception Value Month Months Date 09/30 Year Years Years Years Inception Date Boynton Beach Police Officers Retirement Trust Investment Account - QU7W Total Assets -Gross 1, $ 83,370,726 -0.76 % 3.17 % 2.44 % 3.17 % 2.44 % 8.10 % 7.68 % 5.82 % 6.57 % 07/01/2002 Total Assets -Net 1, 83,370,726 -0.84 2.97 1.67 2.97 1.67 7.26 6.84 5.03 5.78 07/01/2002 Russell Custom Benchmark 3 -- -0.81 3.24 1.00 3.24 1.00 7.07 6.82 5.43 6.19 -- Consultant Benchmark 4 -- -1.05 2.92 -0.67 2.92 -0.67 5.08 5.60 5.10 5.90 -- Total Liquid Return Seeking 53,506,966 -1.22 4.92 1.84 4.92 1.84 10.23 -- -- 11.15 08/31/2012 RTC Multi -Asset Core Fund 32,073,560 -1.56 3.91 0.91 3.91 0.91 8.49 -- -- 9.57 08/31/2012 Multi -Asset Core Composite Bmk 5, -- -1.85 3.51 -2.43 3.51 -2.43 6.73 -- -- 7.60 -- RTC Russell LC Defensive Equity Fd 21,433,405 -0.73 6.44 3.18 6.44 3.18 -- -- -- 11.26 09/18/2013 Russell 1000 Defensive Index (Linked) -- -0.92 6.78 2.54 6.78 2.54 -- -- -- 10.95 -- Total Fixed Income 23,040,911 -0.64 -0.75 0.54 -0.75 0.54 2.09 4.13 5.33 5.27 09/01/2002 Barclays U.S. Aggregate Bond Index -- -0.32 -0.57 0.55 -0.57 0.55 1.44 3.25 4.51 4.45 -- RTC Multi- Manager Bond Fund 23,040,911 -0.64 -0.75 0.54 -0.75 0.54 2.09 4.13 -- 6.19 09/30/2008 Barclays U.S. Aggregate Bond Index -- -0.32 -0.57 0.55 -0.57 0.55 1.44 3.25 -- 4.41 -- Total Alternative Investments 2 6,418,948 2.92 2.92 14.71 2.92 14.71 14.15 12.92 -- 5.28 07/01/2006 Please read the endnotes included with the report. 2- Feb -2016 6:57:49 AM EST Copyright (c) Russell Investments 2016. All rights reserved. Past performance is not indicative of future results. p.17 1J Russell Investments All •••••••••••• ••••••••••••••••••••••••••••••• •••••••••••• ••••••••••••••••••••• Performance Report City of Boynton Beach Police Retirement Fund As of December 31, 2015 Annualized Market One Three Year to FYTD One Three Five Ten Since Inception Value Month Months Date 09/30 Year Years Years Years Inception Date RTC Real Estate Equity Fund 2 $ 6,418,948 2.92 % 2.92 % 14.71 % 2.92 % 14.71 % 14.15 % 14.05 % -- % 5.67 % 07/01/2006 NFI - ODCE -EQ 7 -- 3.43 3.43 15.17 3.43 15.17 13.62 13.56 -- 5.72 -- Please read the endnotes included with the report. Endnotes; 1 Net of fee adjusted returns are estimated using basis point adjustments. Returns are geometrically linked and could experience compounding effects. 2 RTC Real Estate Equity Fund is valued quarterly. The market value shown is as of the quarter ending 12/31/15 while the performance is reported as of the date of the performance report. The market value is reported net of fees while returns are reported gross of fees unless otherwise noted. Fee adjusted returns are estimated using basis point adjustments. Returns are geometrically linked and could experience compounding effects. 3 Russell Custom Benchmark currently consists of: 39.0% Multi -Asset Core Composite Bmk, 26.0% R1000 Defensive, 28.0% Barclays Aggregate, 7.0% NFI - ODCE -EQ. 4 Consultant Benchmark currently consists of: 30.0% MSCI ACWI, 25.0% R1000, 32.0% Barclays Aggregate, 2.0% FTSE /NAREIT, 2.0% S &P Gbl Infrastructure Net, 5.0% NFI - ODCE -EQ, 2.0% Bloomberg Commodity, 2.0% BofAML 3 -Month US T -Bill. 5 The Multi -Asset Core Composite Bmk is appropriate for evaluating the Fund over a 3 to 5 year horizon. 6 The Multi -Asset Core Composite Benchmark currently consists of: 75.0% Russell World Cap 50% Hedged Net Index, 5.0% Bloomberg Commodity Index, 5.0% FTSE EPRA/NAREIT Dev Real Estate Net, 5.0% S &P Global Infrastructure Index Net, 7.0% Barclays U.S. Aggregate Bond Index, 3.0% Barclays U.S. 1 -3 Month Treasury Bill Index. Allocation changes and underlying fund additions and deletions over time will be captured in the composite index. Prior allocations available upon request. 7 NCREIF Fund Index Open -End Diversified Core Equity -Equal Weight (NFI - ODCE -EQ). 2- Feb -2016 6:57:49 AM EST Copyright (c) Russell Investments 2016. All rights reserved. Past performance is not indicative of future results. p.18 G2 Russell Investments Al � Russell Invest Russell fund review Fourth Quarter 2015 ••••••••• •• Performance impact Description .. Significantly positive RTC M u lti-Asset Core Fund + Positive Fund positioning — fourth quarter 2015 Negative — Significantly negative Strategic Positions Justification Quarterly Impact PM Action Small cap, value, and • Consistent with our strategic beliefs, we N/A Despite this long term strategic belief, after a strong momentum overweights in believe these factor biases have long run by small cap and value over the past 5 years, equity term excess return potential . neutralized these factor biases in 2014 Passive 50% currency hedge • Hedging currency helps reduce regret, + We remain 50% hedged gives us ability to be tactical and can reduce overall volatility Tactical Tilts Justification Quarterly Impact PM Action Underweight interest rate • Expensive relative to their historical + Maintained view in Q4 sensitive equities levels, not likely to perform well in a rising interest rate scenario Overweight Europe (hedged) • Low valuations, a supportive ECB and flat Opportunistically increased overweight (now 4 %) on earnings improving on a weak Euro weakness in December could lead to outperformance Underweight US • Valuations are extended and earnings flat i Funded additional Europe overweight from the US have peaked Underweight Commodities • Supply /demand imbalances and strong + ! Neutralized exposure to physical commodities position dollar would cause headwinds in mid - September but remain underweight the theme in equity portfolio Overweight Growth • Expected long term mean reversion + Maintained view in 04 Managers following value manager outperformance Overweight USD • Economic growth, rising rates and policy + Continue to maintain underweight to CAD and AUD divergence could lead to strong USD Beta • Underweight due to anticipated volatility -- Maintained view in Q4 Selection Impact Justification Quarterly Impact PM Action Active manager stock • Idiosyncratic in nature; Russell has ++ Incrementally added to high conviction active selection as the main driver differentiated research and managers managers after periods of underperformance of excess returns with skill Past performance is not indicative of future results p This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. 1 ] Russell Investments AN Any stock level commentary is specific to the impact on fund performance only and is not a recommendation to purchase or sell any specific securi RTC Multi -Asset Core Fund — period ending December 31 2015 Strategy Annualized Performance Year to Three Inception 4Q 2015 Date One Year Years to dater The Russell Multi -Asset Core Fund has a strategic allocation of 75% global equity, 15% real assets (global RTC Multi -Asset Core Fund 3.91% 0.91% 0.91% 8.49% 7.84% REITs, listed infrastructure, and commodities), and 10% Multi -Asset Core Composite Index 3.51% - 2.43% - 2.43% 6.73% 6.49% fixed income. The Fund is dynamic in nature and so the 'Fund inception date is 05/07/1992. Effective April 2, 2012 the Russell Global Equity Fund changed its name to the Russell Multi -Asset Core Fund and changes were made to the portfolio manager is allowed to deviate up to +/- 3% from underlying allocations/ investments. In addition, the Funds primary benchmark changed from the Global Equity Composite Index to the Multi-Asset Core Composite Index. Historical performance of the Russell Multi -Asset Core Fund is available upon request. the strategic targets to take advantage of market Russell Multi -Asset Core Fund Composite Benchmark consists of: 75% Russell World Cap 50% Hedged Index, 5% Bloomberg Commodity Index Total Return (USD), 5% FTSE opportunities to enhance return and /or to manage risk. EPRA/NAREIT Developed Real Estate Index (Net), 5% S&P Global Infrastructure Index Net (USD), 7% Barclays U.S. Aggregate Bond Index, 3% Barclays U.S. 1 -3 Month Treasury Bill 0 pp g Index. Strategic asset allocation changes overtime will be captured in the composite index. The Fund utilizes a combination of Russell asset class funds, separate manager accounts, and positioning Characteristics 4Q2015 3Q2015 strategies3. Total Net Assets $1.75B $1.67B Excess Return Attribution 4Q 2015 Global Equity Fund Russell Fund Russell World Cap World Cap Top three contributors to excess return Portfolio P/E 17.7 17.0 16.4 15.3 Portfolio P/E — I /B /E /S 1 yr. Forecast EPS 16.2 16.0 15.0 15.1 $ Weighted Average Market Capitalization $90.03B $86.14B $81.52B $79.00B Active Managers 0.7°/, Return Seeking Fixed Income Fund Barclays US Fund Barclays US Aggregate Aggregate Current Yield (%) 2.6 2.6 2.3 2.3 EMEA ex UK EN 0.1% Overweight Weighted Average Duration 5.6 5.6 5.4 5.4 Average Credit Quality Aa3 Aa2 Aa3 Aa2 CAD Underweight I 0.0% Strategic Asset Allocation's Actual Asset Allocation as of 12/31/2015 0.00% 0.20% 0.40% 0.60% 0.80% Aggregate Casio Aggregate Cash Fixed 3% Fixed 5% Income •Contribution to Excess Return Global Inure Global I Commodities 1 Commodities 6 %� Top three detractors from excess return 5% 6% \ Global Listed _ Real Estate Global Listed Global Equity 5% Real Estate 49% REITs underweight -0.1% - Globe Global . Infrastru • 5% Infrastructure Neutral 1 0.0% . 5% Emerging J Australia Underweight 0.0% I Global Markets Global Equities 3% I yuites • ,..__...._. 75% J 75% Regional -0.80% -0.60% -0.40% -0.20% 0.00% Small Cap 2% •Contribution to Excess Return US Large Cap Global ti - Equities 8 _ 13% 3 Positioning strategies - customized exposures directly managed by Russell for use within the total portfolio to effect the funds' investment strategies and /or to modify overall portfolio characteristics to seek to achieve the desired risk/return profile °Strategic allocations may vary based on tactical allocations made by the portfolio manager, which may allow the weightings of each asset class to take advantage of potential opportunities as market and economic conditions change. See next page for additional disclosures. 21 'Source: FactSet Russell Investments AM p °Source: FactSet • • . • • • • • • • • • • • • • • • • • . • • . • • • • • • • • • • • • • • • • • • • •••••••••••• ••••••••••••••••••••• RTC Multi -Asset Core Fund - period ending December 31, 2015 Global Equities Regional Exposure Sector Exposure , � � ; 1 ,ztl 1 USD Local USD Index Return Index Return Index Return Index Return Utilities EL. 3.1% 2.2% US 10111L 5.8% 5.8% - Telecom M 6.0% 4.9% UK - 4.4% 1.5% IT 1.0. 6.7% 6.5% Japan 9.1 % 8.4% Financials 4.9% 4.0% 1 Health Care IMIIIIIIIIIIIIIIMIIIIIIIIr 8.8% 8.1% Canada ` -0.5% -4.0% Cons. Staples 11111111111111.11111111111 5.8% 4.9% EMEA ex UK ! 6.1% 3.6% Cons. Disc. 6.5% 5.6% Asia/Pacific Ex Ja an Industrials 7.0% 6.3% P ` 6.1% 8.2% Materials =IMF 2.4% 1.5% Emerging - 3.8% 2.9% Energy -1.1% -2.5% 0% 20% 40% 60% 0% 5% 10% 15% 20% 25% • Russell Multi -Asset Core Fund - Global Equities • Russell World Cap ■Russell Multi -Asset Core Fund - Global Equities ■Russell World Cap Index i q Index Real Assets 'gRaWCI a% Global Real Estate Exposure 1' Global Infrastructure Exposure Commodities Exposure A A l ; Self Storage Other 14% Highways & E 5% Railtracks 20% C23% a°9Y sh 20ner Diversified � ' Railroads 5 %_,,, 29% Retail 26% Marine Ports Services5% Livestock • Gas Utilities \ 4% Grains 5% 12% �� Electric . Utilities l7 % Softs , \ 9% Health Care Airport ! 6% Services 9% Industrial4% Residential 1 Lodging /Resorts Industrial Multi- Utildies 13 % Oil & Gas Metals 14 % 4% / Storage & Precious 14 Office Mixed Transportation Metals 0% __.. _ 12% 18% Office 12% _ .. The Russell Multi -Asset Core Fund is a dynamic, diversified portfolio designed to capture market opportunities. The underlying allocations to various asset classes will shift over time, but the overall strategic allocation will remain 75% global equity/15% marketable real assets/10% U.S. fixed income. The Russell Multi-Asset Core Fund invests in underlying funds of the Commingled Employee Benefit Funds Trust and/or separate accounts managed by Russell Trust Company. Prior allocations available upon request. Russell Multi-Asset Core Fund is an investment fund of the Russell Trust Company Commingled Employee Benefit Funds Trust. It is not a fund of Russell Investment Company, nor a mutual fund registered under the Investment Company Act of 1940. 5 Source: FactSet p.22 D2 Russell Investments ■ RTC Multi -Asset Core Fund Asset class returns and average relative positioning as of December 31, 2015 ani■ Asset Class Returns ■ Average Relative Position - - Fund Return (3.91 %) - - Benchmark Return (3.51 %) 12.0% 10.0% 9.7% 0 8.0 ° 6 6.5% 6.1% 6.0% o 0 4.7/0 4.1% 4.1% 4.6/0 3.8% - 4.0% - MEW OMB 9 47. ACM . �.� CD 0 2.0% io 3% 1% 0.0% 0.0' 0.3% 0.0% ce 0.0% , - 2.0% - 0.1 % -0.6% -0.7% 0.0% 1.9% 1 % -0.6 °0 -0.8% -0.3% -0.5% 0% 4% 0% 15 1.6% -1.0% -2.1 % o 0 -4.0% 2.6 /0 2.6 /o -2.8% -3.8% -6.0% -8.0% -7.3% -10.0% c io c N 0 o (0 t rn Q >- 0 0_ m o - ° m = '� co c n d in CO D Q a 2 = Y -o m in t) - 5 U o Q -, 0 w U -9 m = Q 0) w 2 o m m w w g c U o w E m 0 2 E To -o w o Q co 0 0 0 0 to To S C7 E o o a . n ` 0 o E U w U C 7 (7 W Global Equities Real Assets Fixed Currencies Income /Cash *Local market returns. **MSCI Emerging Markets Currency Index. The Index weights each emerging market currency return vs. the dollar by its market cap in the MSCI Emerging Markets Index. Currency returns are spot returns vs. USD. Performance is gross of fees. Fees will reduce the overall performance of the fund. Indexes /benchmarks are unmanaged and cannot be invested in directly. Data is historical and is not indicative of future results. Russell Multi -Asset Composite Benchmark consists of 75% Russell World Cap Index 50% Hedged, 5.0% Bloomberg Commodities Index, 5.0% FTSE EPRA/NAREIT Developed Real Estate Index(Net), 5% S &P Global Infrastructure Index, 7% Barclays US Aggregate Bond Index and 3% Barclays US 1 -3 Month Treasury Bill Index. Russell Volatility Equivalent Benchmarks consists of 85% Russell World Cap Index 50% Hedged and 15% Barclays US Aggregate Bond Index. This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. Average relative position is average of weekly relative weights during the quarter. p.23 Russell Investments AI ••••••••••••••••••••••••••••••••••••••••••• • .0• ••••••••••••••••••••••••••••••••••••••• RTC Multi -Asset Core Fund Asset allocation and advisor lineup as of December 31 2015 ASSET CATEGORY Global Equity Real Assets Diversifying Fixed Cash Income 74.8% 13.9% 6.1% 5.2% ASSET CLASS Global Equities Global ex US Equity US Large Cap Regional Small Cap Emerging Markets Global Real Estate Global Infrastructure Global Commodities US Agg Bonds Cash 48.5% 13.3% 8.3% 2.1% 2.6% 2.9% 5.1% 5.9% 6.1% 5.2% ADVISORS/STRATEGIES RTC Emerging Markets RTC Global Real Estate RTC Global RTC Quantitative Bond Harris Axiom SGA RTC Small Cap Fund Fund Securities Fund Infrastructure Fund RTC Commodities Fund Fund Cash 3.5% 3.6% 8.3% 2.1% 2.6% 2.9% 5.1% 5.0% 6.1% 5.2% Kopemik MFS Ancora Advisors Alliance Bemstein Cohen & Steers Cohen & Steers CoreCommodity Neuberger Berman 3.5% 3.6% Perkins Polaris DePrince Axiom INVESCO Colonial First Credit Suisse 7.3% 3.8% Sanders Pzena EAM Delaware Morgan Stanley Lazard Gresham 7.0% 2.3% Wellington Falcon Point Harding Loevner Russell Trust Company Nuveen Russell Backwardation Strategy 6.3% Russell Positioning Netols Genesis Strategies 20.8% Robeco Numeric Snow Capital Oaktree Summit Creek Westwood Russell Positioning Strategies Allocations and Advisors /Funds /Strategies are as of December 2015. Current data may be different. The Russell Multi -Asset Core Fund is a dynamic, diversified portfolio designed to capture market opportunities. The underlying allocations to various asset classes will shift over time, but the overall strategic allocation will remain 75% global equity /15% marketable real assets /10% U.S. fixed income. *Russell positioning strategies are customized exposures directly managed by Russell for use within the total portfolio and may include overlays, replication, smart beta strategies, and custom quantitative strategies. This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. p.24 D2 Russell Investments AN RTC Multi -Asset Core Fund Developments and outlook — fourth quarter 2015 Fund Activity > Increased overweight to Europe from US on weakness in December Fund Outlook & Positioning > Maintaining less than benchmark risk levels with beta around 0.97 -0.98 > Quantitative easing and earnings improvement could lead to structural changes Europe resulting in potentially superior relative returns for equity investors; overweight Europe vs. US and commodity producing countries like Australia & Canada > After several years of outperformance, valuations appear extended in the US and earnings have peaked. The US is now our largest underweight > Underweight to commodities /energy sector /commodity countries has been accretive to portfolio. With recent extreme sell off, we have started to reduce the concentration of positions in this direction > Rising interest rates, real estate valuations and turning sentiment from yield investors expected to lead to underperformance versus other real assets; continue to maintain our underweight > The US dollar may be early in a multi -year strengthening cycle, but currency volatility has increased sharply and the long USD trade has gotten very crowded; maintain our underweight to AUD and CAD but monitoring these positions closely Past performance is not indicative of future results. There is no guarantee that any stated expectations will occur. G2 Russell Investments p• This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. •••••••••••• •••••••••••••••• •••••••••••• ••••••••••••••••••••• RTC Large Cap Defensive Equity Fund - period ending December 31 2015 Strategy Performance Annualized 402015 Year to date One year Three years Five years Ten years Seeks higher long -term returns that exceed the Russell 1000 RTC Large Cap Defensive Equity Fund 6.44% 3.18% 3.18% 15.55 °o 12.87 i 6.76% Russell 10000 ®® D efensive Index Defensive Index® by investing in common stocks that rank among ll - nd e - - D® (Linked)` 6.78 2.54 I 2.54 1 15.17 I 11.97 I 7.18 the largest 1,000 companies in the U.S. stock market while main- taining - - volatility and diversification similar to the index over a full 402015 302015 market cycle. Characteristics Russell 1000 Russell 1000 Fund Defensive Index® Fund Defensive Index® T Total Net Assets $459.45M $10.47T $423.17M $9.90T To 10 fund holdin s' p g j Fund% Index i2 I Portfolio P/E - I /B /E /S 1 yr. Forecast EPS 17.4 17.5 16.2 16.5 Apple, Inc 2.99 4.22 LT Growth Forecast I /B /E/S Medians 9.12% 8.78% 9.39% 9.18% 2 .._ Procter & Gamble Co (The) 2.54 2.06 -- Price /Book Ratio 3.40 3.27 3.15 3.08 Johnson & Johnson 2.48 2.72 - Wells Fargo & Co. 2.19 2.42 $ Weighted Average Market Capitalization $134.47B $159.45B $118.50B $147.968 Pfizer, Inc. 2.18 1.90 Portfolio Beta vs. Russell 3000® Index 0.80 0.77 0.79 0.77 UnitedHealth Group, Inc. 1.97 1.07 1 Source: BNY Mellon Asset Servicing except Total Net Assets. Exxon Mobil Corp. 1.87 3.11 Sector weightings & 40 returns) ( %) 1 Fund advisor styles Microsoft Corp. 1.80 2.35 Target weightings % 402015 I 302015 Home Depot, Inc. 1.80 1.64 Market- oriented 100 100 Philip Morris International, Inc. 1.68 1.30 aRTC Large Cap Defensive Equity Fund Index Returns Total 21.49 22.79 ■Russell'D00® Defensive Index® Advisor diversification 1 The top ten holdings list does not reflect the investment of cash Consumer 4.92 reserves and cash collateral received in securities lending transactions in Discretionary one or more of Russell's money market funds. Consumer Large 2 Source: BNY Mellon Asset Servicing staples 8.33 Jacobs Levy 4Q Greatest impact' ( +) Over/under ; contribution Financial weight / to return /° Services 5.73 - - - -- __ - " " - - -- Russell 1000 Defensive Index Procter & Gamble Co. (The) 1.43 0.11 Health Care 8.33 Size Vinci SA 0.84 0.09 UnitedHealth Group, Inc. 1.36 0.09 M Medals and a * PanAgora Kinder Morgan, Inc. -0.15 0.07 Processing 7.48 RTC Defensive Equity Fund : AmerisourceBergen Corp. 0.97 0.06 Energy 8.60 __ -- - --. _.... ---- JP Morgan _.--- 1 - --- - on Medium 4Q Greatest impact) ( -) Over /under Contribution Producer Russell positioning strategies weight % to return % Durables 5.07 Coho General Electric Company -1.34 _ -0.09 value Style Growth Celgene Corp. -0.41 -0.04 Technology IIIIIIIMIIII 8.15 Amazon.com, Inc. -1.22 -0.04 -- I Occidental Petroleum Corp. 0.43 -0.04 Utilities EMI 4.02 State Street Corp. 0.53 -0.03 0 5 10 15 20 1 Source: FactSet 1 Source: BNY Mellon Asset Servicing 'Historical performance prior to July 2, 2012 is linked to the Russell 1000® Index. Advisors listed are current as of December 31, 2015. Russell has the right to engage or terminate an advisor at any time and without notice. This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. Performance shown is gross of fees. Fees will reduce the overall performance of the fund. Indexes are unmanaged and cannot be invested in directly. Past performance is not indicative of future results. p.26 Russell Investments An RTC Multi- Manager Bond Fund • period ending December 31 2015 Strategy Annualized Performance In n ception . Seeks favorable returns comparable to the broad fixed income 402015 Year to date One year Three years Five years to dater market by investing in bonds representing diverse sectors and ' RTC Multi- Manager Bond Fund -0.75% 0.54% 0.54% 2.09% ' 4.13% 5.03% maturities. Barclays US Aggregate Bond Index j -0.57 0.55 1 0.55 1.44 3.25 i 4.24 I 1 Inception date 4/30/03. The date shown represents the date the index comparison began and may not be the actual index inception date. Quality distributions,` 1 Fund( %) Index( %) AAA I 53.6 72.5 402015 302015 AA 4.2 3.7 CllaraCteristicsl Barclays US Aggregate Barclays US Aggregate Fund Bond Index Fund Bond Index A 11.8 10.6 Total Net Assets $3.108 $18.13T $3.13B $18.18T BBB 19.3 13.1 Current Yield 2.93% 2.55% 2.67% 2.27% BB 3.7 0.0 Weighted Average Yield to Maturity 3.2% 2.6% 2.6% 2.3% - B 1.8 0.0 Weighted Average Life 7.9 yrs. 7.6 yrs. 6.7 yrs. 7.5 yrs. CCC & Below 3.5 0.0 Weighted Average Duration 5.9 yrs. 5.5 yrs. 5.3 yrs. 5.4 yrs. Unrated 2.1 0.0 Average Quality* A2 Aa2 A2 Aa2 1 Source: FactSet except for Total Net Assets Maturity distributions Fund (%) Index ( %) o to 3 Years 31.3 53.4 Fund advisor styles Sector weightings( 3 to 5 Years 14.2 15.0 %�1,2 Target weightings % Fund Index 402015 3Q2015 5 to 7 Years 14.9 9.2 - Developed Government/ 23.3 43.0 • Fully discretionary 72.5 72.5 Government- Related _ Alpha Overlay 7 to 10 Years 20.3 8.8 14.0 14.0 10 to 15 Years 2.9 1.5 Investment Grade Credit 25.2 23.8 ■ Sector Specialist 5.0 5.0 15 to 20 Years 2.0 1.5 High Yield 6.1 0.0 I: Russell Strategies 6.0 6.0 - - -- -- - - -- - 20 to 25 Years 1.8 3.4 Commercial Mortgage Backed 5.7 1.8 25+ Years 12.6 7.2 Residential Mortgage Backed 16.8 28.6 • Advisor diversification "'Source: FactSet Asset Backed 5.9 0.6 Credit qualilty exposures and/or maturity distributions may not equal 100 percent as a result of the fund's use of certain financial instruments Emerging Markets Debt 4.5 2.1 Russell Currency Overlay such as Futures, forwards, options, swaps and when issued transac- Net Cash & Equivalents 12.5 0.0 Strategy Western Asset tions or forward commitments. In the event short positions are created, q Bissell Absolute Return 5.3% Management they may be reflected as negative weightings in sector allocations, cred- Derivative 0.0 0.0 Fused Income Fund Conpany(Bank Loan) it quality exposures and /or maturity distributions. - 0.7% 1 Sector Allocations may not equal 100 percent as a result of the Macro currency Group 1 fund's use of certain financial instruments such as futures, forwards, Western Asset 8.0 % options, swaps and when issued transactions or forward commit - Management Conpany Colchester Global ments. In the event short positions are created, they may be reflected 21.0% as negative weightings in sector allocations. Investors United 2 Source: FactSet and BNY Mellon Asset Servicing 6.0% Logan Circle Scout Investment hc." "-Partners, L.P. 18.5% 21.0% Brookfield Investment Wellington Management Management Inc. Conpanay 4.0% 12.0% Advisors listed are current as of December 31, 2015. Russell has the right to engage or terminate an advisor at any time and without notice. This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. Performance shown is gross of fees. Fees will reduce the overall performance of the Fund. Indexes are unmanaged and cannot be invested in directly. Past performance is not indicative of future results. *The sum of the debt instrument quality ratings is based upon the Barclays index methodology, which reflects the ratings of Moody's, Fitch and S &P in such a way that if three different ratings exist for the same instrument, the median rating is used: if two different ratings exist, the lower of the two is used and if only one rating exists, then that rating is used. If the debt instrument has not been rated by any of the three rating agencies, the security is classified as 'Unrated." p.27 U2 Russell Investments AM ••••••••••••••••••••••••••••••••••••••••••• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • Russell Real Estate Equity Fund - period ending September 30 2015 Strategy Performance Annualized 302015 One year Three years Five years Ten years Employs a Multi- advisor, multi -fund investment approach ap- C Russell Real Estate Equity Fund 3.28° 15.56 °% 13 96 °0 14.64 °0 6.50 °o plied to private core and enhanced core real estate funds. NFI- ODCE -EQt 3.63 14.81 13.22 1 13.87 6.43 Focus on high current income. Manage risk through property type / regional diversification and generally limit portfolio lever- 1 NCREIF Fund Index Open -End Diversified Core Equity - Equal Weight (NFI - ODCE -EQ). age to 30 %. Characteristics i Total gross returns 1 RTC - REEF's leverage of 21.4% at 9/30/2015 was within the general Target Market value Market value 1 Three One 9 9 r S Millions % of total m onths % /o htin 0 o Core funds weighting ° guideline limit of 30 / and below the Benchmark leverage of 22.7 /o. year Morgan Stanley Prime Property Fund 20 -30 240.8 32.2 3.91 17.13 Property type composition J.P. Morgan Strategic Property Fund 30 -35 229.1 30.6 3.39 14.53 _ INVESCO Core Real Estate - USA 15 -25 175.9 23.5 2.96 15.84 UBS Trumball Property Fund 20 -30 63.4 8.5 3.46 12.94 Clarion lion Properties Fund 20 -30 0.0 0.0 3.33 16.72 Industrial 11.3% Benchmark total return breakout % 302015 Year to date One year Apartments 25.6% Y Income 1.20 3.64 4.88 Capital Appreciation 2.42 7.52 9.57 1 Self Storage 1.9% -- - - Retail 19.3% -`�! Other 0.2% Regional composition Hotels 0.7% i ■ PACIFIC 37.2% Office 41.0% ■ MOUNTAIN 4.8% lr • WEST NORTH CENTRAL 1.3% +...z...v., .- s' ■ SOUTHWEST 12.3% . ph ■ EAST NORTH CENTRAL 5.9% IF IKK ■ NORTHEAST 20,8% o MIDEAST 9.4% ■ SOUTHEAST 8.3% Funds listed are current as of September 30, 2015. Russell has the right to engage or terminate a fund at any time and without notice. This is a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust; it is not a mutual fund. Performance is shown gross of fees. Fees will reduce the overall performance of the fund. Indexes are unmanaged and cannot be invested in directly. Past performance is not indicative of future results. p.28 Russell Investments AN •••••••••••• •••••••••••••••••••••• Russell , Investments Appendix 111111 AM Absolute Return Fixed Income ••••••••••••••••••••••••••••••••••••••••••• RIFL Absolute Return Fixed Income Fund What is it? > A combination of liquid Tong -short strategies across global interest rates, credit and currency, where manager skill tends to drive total returns rather than systemic benchmark risks. > Return and risk are designed to be a core fixed income substitute with bond -like volatility and mid single -digit returns over the long term. Benefits > Seeks to deliver positive returns independent of the market cycle. > Flexible strategy not tied to a benchmark. > Broad investment universe creates more opportunity. > Focus is on downside protection. > Liquid strategy. > Broad diversifier to equities and bonds. The Russell Absolute Return Fixed Income Fund is not a mutual fund, but is a fund of the Russell Institutional Funds, LLC; it is a private placement. p.30 Russell Investments RIFL Absolute Return Fixed Income Fund - period ending September 30 2015 Strategy Annualized Performance Inception Seeks to outperform the 3 Month LIBOR Constrained Index 302015 Year to date One year Three years Five years to dater (USD Hedged) over an interest rate cycle. RIFL Absolute Return Fixed Income Fund -0.20% 0.89% 1 19% - % -% 1.13% Barclays 3 Month USD LIBOR Cash Index I 0.08 0.22 0.28 -- -- 0.26 Qualit Distributions 1 Inception 03/31/14. The date shown represents the date the index comparison began and may not be the actual index inception date. y F und ( %) Ind ( %) 2 Source: Barclays 3 Month USD LIBOR Cash Index, used with permission. Barclays 3 Month USD LIBOR Cash Index is licensing the Barclays AAA 84.2 100.0 3 Month USD LIBOR Cash Index Indices as is ", makes no warranties regarding same, does not guarantee the quality, accuracy, and/or com- pleteness of the Barclays 3 Month USD LIBOR Cash Index Indices or any data included therein or derived therefrom, and assumes no liability AA 1.3 1 0.0 in connection with their use. A 1.7 0.0 302015 202015 BBB 8.5 0.0 Characteristics Barclays 3 Month USD Barclays 3 Month USD BB 2.6 0.0 Fund LIBOR Cash Index Fund LIBOR Cash Index B 0.6 0.0 Total Net Assets $172.85M $149.831 $115.93M S149.71T CCC & Below 0.0 0.0 Weighted Average Yield to Maturity 1.17% 0.33 0.14 % 0.28% Unrated 1.1 0.0 Weighted Average Duration 1.61 0.25 0.74 0.25 1 Source: FactSet Average Quality* Aa3 AAA Aa3 Aaa 1 Source: FactSet 30 Currency Exposure ( +) Portfolio Sector Weightings ( %), ! Fund Manager Styles - USD 8.10 Fund Target Weightings % 3Q2015 2Q2015 JPY 7.80 Cash 67.7 Currency 55 55 NZD 1.02 Govt 3.08 • Multistrat 45 45 MXN 0.01 Govt related (Quasi) 3.3 Finance 7.8 -- Manager Diversification Industrial 9.24 Utility 0.81 30 Currency Exposurel ( -) Portfolio 1 ABS 3.27 macro Russell GBP 2.00 1 Other 1.49 Cunenccy Investments _ Group 5% TBH -2.01 1 The Other sector includes pooled investment vehicles, certain deriv- 50% ,, _. atives, stocks and other investments not falling within one of the other ~ r" `7 s r.�: CNY -2.30 listed sectors. EUR -2.43 ° ' l , Blue Bay AUD -4.39 ?" Investment Guide 1 Source:FactSet d rte Return Bond Investment Fund 45% Managers listed are current as of September 30, 2015. Russell has the right to engage or terminate a manager at any time and without notice. This is a fund of Russell Institutional Funds, LLC; it is a private placement. It is not a mutual fund or a fund of the Russell Trust Company Commingled Employee Benefit Funds Trust. Performance is shown gross of fees. Fees will reduce the overall performance of the Fund. Indexes are unmanaged and cannot be invested in directly. Past performance is not indicative of future results. *The sum of the debt instrument quality ratings is based upon the Barclays index methodology, which reflects the ratings of Moody's, Fitch and S &P in such a way that if three different ratings exist for the same instrument, the median rating is used: if two different ratings exist, the lower of the two is used and if only one rating exists, then that rating is used. If the debt instrument has not been rated by any of the three rating agencies, the security is classified as 'Unrated.' p.31 1] Russell Investments AN •••••••••••• ••••••••••••••••••••••••••••••• ■ a"o Burgess Chambers & Associates, Inc. Institutional Investment Advisors www.burgesschambers.com December 31, 2015 Boynton Beach Police Pension Fund Investment Performance Period Ending December 31 2015 The following investment information was prepared by BCA, relying upon data from statements provided by the plan custodian and /or investment manager(s). 1-3 `' ^ BCA reviews transactions p How BCA cann guarantee the accuracy of the custodian's custodian's statem nt of the data contained herein. l_ A • Boynton Beach Police Pension Fund BCA Market Perspective © The Perils of Cheap Oil Burgess Chambers & Larry Cole January 2016 the number of everyday products is endless. Until The price and availability of oil affects all of us. From fuels to fertilizer to building materials, we come up w Y world produces 93 million barrels of ith a wa to capture carbon dioxide from the atmosphere and convert it developing s d. er ee stay, as perhaps the most important r resource needed to maintain our standard of living and improve the wellbeing of the p g wor ° which comes from the 13- member OPEC cartel - followed by Russia (12 %), and US (10 %). A 1.5 million per day surplus of oil per day, 34 /o of w crude has been in place for more than a year — causing a global pricing collapse. ) peaked oil prices dollars eaked in June 2014. In November that year, OPEC approved a Saudi motion to keep oil production unchanged, in spite of a weakening market caused by excess production. During the following 14 months, oil declined from revenue ocollapse. ae irony is that OPEC coulld d have ave engineered a 1.5 million pullback to stabilize the market - a 5% cut w ould have prevented has been speculation that Saudi Arabia has engineered a drop in oil prices to shut down n US oil p ro du cer a plausible 50 o l to pay lenders is based and bond holders. Those producers represent one -half of domestic production or 5.5 million per ' conflict with Iran and Russia over Syria and more recently Yemen. In short, aud0 i Arabia Saudi Arn os call the s ho ts o in t oil r part o of f the he w w as c orld and eliminate Iran and Russia's influence. By bringing oil paces well ho its enemies fighting in the region. the other nine economic Consumers are loving $2 gasoline and are in fact driving 3.5% more cut every day ( 1/8/16). than positive wealth effe tlThisps giving c anies are a $7.8 cf bri�s, res ins, paint and just sectors are benefitting from lower energy costs. For now, there will be a p prices last , WSJ 1/8/16 Not only are heating bills lower, but as petro chemical rices fall with oil, the cost of fertilizer, d -w p about everything else gets cheaper. But what happens in three years w sho glo ro l ect take the longest SEnergypcompanies are resins, piling . It takes five to ten years to identify, evaluate, engineer and drill f and field hands. Unused drillin g rigs are drill up in empty field laying off geologists, engineers, welders, electricians, painters, pipefitters, As or oil a roaches over 100 million barrels per day in the next five years, Iran and Iraq). The obhea Saudi available from friendly i erd Gulf regions around world ound the world. demand for ar orld. By that time, Saudi Arabia may be in the midst of a full blown war wit h e rotection. The developed world, along with the emerging powers of China and India are at great risk today that oil supplies states may not hav e p may be disrupted in the near future. This uncertainty causes nations to prepare for war. BCA Disclosure: All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change. Content should not be regarded as a complete analysis of the subjects discussed or as personalized investment advice. All investment strategies ha ve the potential for profit or loss. References to market performance in publications do not represent the returns achieved by Burgess Chambers & Associates or any of its advisory clients. , 0 1 Quarterly Market Summary December 31, 2015 16.0 8.0 7.0 6.4 7] 3.6 4.7 1.5 1.8 0.7 0.6 0.0 a -0.6 -1 -1.6 cc -2.1 .3 -2.1 -8.0 -10.5 -16.0 f D z} aa t a a, a a, a a., �`�' c i s 5 z ° �� y i} 0 0 v . ° m c i C. h J o o j '' . . Q 0 0 4 v o Q . ...9 '' m y i ry 4P 4, P . u -2 a ° m D h � � v ` � `Q. d°� a 5 F Q° J y �00 v A y Q g G of c ' 4 J Q o 0 C. p V + is N v 6 Q ,E-, a m co. . P ° z �� g o 4 4 F °fie � - .° � 4 -. J - yG4, �m C (94? ''''r / ,:- Q� ,2 rC QJ �° 5 Q7' 4 \ � 2 Source: Investment Metrics, LLC I US Market Indices Performance US Market Sector Performance 12.0 30.0 7.0 7.9 6.1 5.5 15.0 6.0 3.6 4.1 3.1 3.6 4.3 2.9 0 5.8 7.6 6.0 9.2 8.0 9.2 9.7 7.6 10.1 6.6 6.9 5.9 3.4 1.4 0 0 0.2 1.1 . 0.0 v t -0.2 -4.8 C'c' -1.4 -8.4 -3.1 -2. -15.0 -6.0 _4s -4.4 -21.1 -7.5 -30.0 1 1 -12.0 1 Quarter Year 1 1 Quarter Year 1 S &P 500 Consumer Discretionary ■ S &P 500 Consumer Staples ■ S &P 500 Energy • 5 &P 500 III S &P 500 Growth 1 S &P 500 Value 1 S &P 500 Financials 1 S &P 500 Health Care S &P 500 Industrials II Russell Midcap Index 111 Russell Midcap Growth Index III Russell Midcap Value Index 1 S &P 500 Information Technology II S &P 500 Materials 1 S &P 500 Telecom Services 1 Russell 2000 Index II Russell 2000 Growth Index 1 Russell 2000 Value Index 1 S &P 500 Utilities Source: Investment Metrics, LLC Source: Investment Metrics, LLC Copyright © 2015 In 13CA 2 ti Quarterly Market Summary December 31, 2015 Fixed Income Market Sector Performance 3.0 1.5 1.5 1.2 2 0.8 1 .0 0.5 0.0 0.1 0 -0.6 -0.6 -0.5 -0.6 -0.8 c 0.9 -0.9 cc -2.1 - -3.0 -3.2 -4.5 - 6.0 1 1 Year Quarter II Barclays II Barclays U.S. MBS Barclays U.S. Treasury ,.• `a, Barclays U.S. Agency � Barclays U.S. Credit Index y Barclays U.S. Aggregate ® y II ' ':" JPM EMBI Global (USD) Ill Barclays U.S. ABS Barclays U.S. Corp: High Yield iy' Barclays Global Aggregate Source: Investment Metrics, LLC Intl Equity Region Performance Intl Equity Indices Performance 18.0 20.0 9.9 12.0 9.9 10.0 9 4 6.8 6.7 4.7 4.5 8.3 2.7 0.7 3.3 a ; 0.0 ._. -0.4 - 0.7 0.1 illii 0 -5.2 E 0.0 z -10.0 cc -14.6 -6.0 7.5 8.4 -20.0 -12.0 -30.0 1 1 Quarter Year 1 1 ■ MSCI EAFE Index ■ MSCI EAFE Small Cap Index MSCI SAFE Growth Index Quarter Year ■ MSCI EAFE Value II MSCI Emerging Markets ■ MSCI Japan a MSCI Pacific ex Japan a MSCI United Kingdom a MSCI Europe ex U.K. Source: Investment Metrics, LLC Source: Investment Metrics, LLC Irk Copyright © 2015 In Boynton Beach Police Pension Fund Total Fund Investment Summary December 31, 2015 • Broad U.S. indices experienced positive returns in 2015, specific industries, notably energy and materials, struggled. International and emerging markets faced a more challenging environment in the presence of deflation and declining commodity values. In December, the Federal Reserve Open Market Committee (FOMC) increased the rate range for the Federal Funds Rate by 0.25 %, the first increase since 2006, and signaled room for more hikes in 2016. • For the quarter, the Fund experienced an investment gain of +3.1% gross (or +3.0% net; +$2.4 million), which performed ahead of the Policy Benchmark ( +3.0 %). The best performing asset category was the large cap defensive equity Fund ( +6.4 %). • For the twelve -month period, the Fund earned $1.8 million or +2.4% gross ( +1.6% net). This exceeded the Policy Benchmark by approximately 2.4% and ranked in the top 5th percentile. • The best performing asset category for the year was the RTC Real Estate Equity Fund ( +14.7 %). • For the three and five year periods, the Fund earned $17.1 million or +8.0% and +7.6 %, respectively. PCA 4 Boynton Beach Police Pension Fund Total Fund Investment Policy Review December 31, 2015 Yes No The total Fund's annualized three -year performance achieved the Policy Benchmark. ZI The total Fund's annualized three -year performance ranked in the top 40th percentile of the universe. El The total Fund's annualized five -year performance achieved the Policy Benchmark. The total Fund's annualized five -year performance ranked in the top 40th percentile of the universe. The total Fund's annualized three -year performance achieved the +7.75% actuarial assumption rate. 1=1 The total Fund's annualized five -year performance achieved the +7.75% actuarial assumption rate. Multi Asset Core annualized three -year performance achieved the multi -asset benchmark. ® 0 Multi Mgr Bonds annualized three -year performance achieved the fixed income benchmark. ® I I Multi Mgr Bonds annualized three -year performance ranked in the top 40th percentile of the universe. ® I I Fl Multi Mgr Bonds annualized five -year performance achieved the fixed income benchmark. 0 Multi Mgr Bonds annualized five -year performance ranked in the top 40th percentile of the universe. El Real Estate Equity's annualized three -year performance achieved the real estate benchmark. N Real Estate Equity's annualized five -year performance achieved the real estate benchmark. PFIA Compliant Investments in equity securities were 56.5% which did not exceed 70% of Fund's assets at market value. El Foreign equity investments were 19.6% (at market) and did not exceed the 25% of the total Fund's assets at market. Asset allocation among fixed income was 30.3% (at market) within the 30% minimum limitation. Asset allocation among alternatives was 13.2% (at market) within the 20% maximum limitation. BCA 5 N.. Boynton Beach Police Pension Fund Investment Performance - Net December 31, 2015 Quarter One Year Three Years Five Years Beginning Market Value 78,037,731 81,540,326 66,282,023 53,507,101 Contributions 2,950,805 - 11,885 - 40,860 4,517,130 Gain /Loss 2,382,190 1,842,285 17,129,564 25,346,496 Ending Market Value 83,370,726 83,370,726 83,370,726 83,370,726 Total Fund ( %) 3.0 1.6 7.1 6.8 Policy Benchmark ( %) 3.0 0.0 6.6 6.9 1 BCA 6 1 1 Boynton Beach Police Pension Fund Total Fund December 31, 2015 Actual vs. Target Asset Allocation 2.0% ° 1.95% 1.96% 0.5% 2. 5.0% 2.0% 2.0% 2.0% 1.11% 7.70% • Global Equities • Global Equities • Fixed Income • Fixed Income ■ Global REIT • Global REIT • Global Listed Infrastructure • Global Listed Infrastructure • Commodities • Commodities IN Private Real estate • Private Real estate • Cash • Cash MV ($) Current Target Difference Global Equities $ 47,102,261 56.5% 55.0% 1.5% Fixed Income $ 25,255,220 30.3% 32.0% -1.7% Global REIT $ 929,450 1.11% 2 . 0 % -0 . 9 % Global Listed Infrastructi $ 1,622,958 1.95% 2.0% -0.1% Commodities $ 1,637,987 1.96% 2.0% 0.0% Private Real estate $ 6,418,948 7.70% 5.0% 2.7% Cash $ 403,902 0.5% 2.0% -1.5% Total 83,370,726 100.0% 100.0% 0.0% Total International = 19.6% (This calculation includes foreign equity, REIT, listed infrastructure, and fixed income) 13CA Note: For illustrative purposes only. 7 1 Boynton Beach Police Pension Fund Asset Allocation December 31, 2015: 83,370,726 Russell ST Inv Cash Sweep (CF) 0.48% Russell Real Estate Equity (CF) 7.70% Russell Multi -Asset Core (CF) Russell Large Cap Defensive Equity (CF) 38.47% 25.71% Russell Multi- Manager Bond (CF) 27.64% Market Value $ Allocation ( %) • Russell Multi -Asset Core (CF) 32,073,560 38.47 Russell Multi- Manager Bond (CF) 23,040,911 27.64 • Russell Large Cap Defensive Equity (CF) 21,433,405 25.71 • Russell Real Estate Equity (CF) 6,418,948 7.70 L. ST Inv Cash Sweep (CF) 403,902 0.48 BCA 8 1 i Boynton Beach Police Pension Fund Historical Asset Allocation December 31, 2015 December 31, 2015 December 31, 2014 December 31, 2013 December 31, 2012 December 31, 2011 $44 $44 $44 $44 $44 $40 $40 $40 $40 $40 $36 $36 $36 $36 $36 $32 $32 $32 $32 $32 ... $28 $28 $28 $28 $28 .. $24 g $24 2 $24 $2 4 § $24 5 ' v v v v N $20 .2 $20 $20 $20 $zo $16 $16 $16 $16 $16 $12 $12 $12 $12 $12 $8 $8 $8 $8 $8 $4 ... _. $4 $4 $4 $4 $0 $0 $0 .u_ $0 $0 • US Equity 25.71 • US Equity 26.01 • US Equity 25.78 • US Equity 0.00 • US Equity 0.00 I® US Fixed Income 27.64 • US Fixed Income 29.53 IN US Fixed Income 29.90 ® US Fixed Income 29.74 • US Fixed Income 87.97 • US Private Real Estate 7.70 • US Private Real Estate 5.30 • US Private Real Estate 5.15 • US Private Real Estate 4.17 • US Private Real Estate 10.79 • US Cash 0.48 • US Cash 0.42 • US Cash 0.46 • US Cash 0.47 • US Cash 1.23 ■ Global Mixed Assets 38.47 RI Global Mixed Assets 38.74 • Global Mixed Assets 38.72 1 Global Mixed Assets 65.61 1 Global Mixed Assets 0.00 BCA Boynton Beach Police Pension Fund Asset Allocation & Performance December 31, 2015 QTD 1 Year 3 Year 5 Year Market Value ROR - Rank ROR - Rank ROR - Rank ROR - Rank Total Fund 83,370,726 3.1 (37) 2.4 (5) 8.0 (40) 7.6 (29) Policy Benchmark 3.0 0.0 6.6 6.9 Russell Large Cap Defensive Equity (CF) 21,433,405 6.4 3.2 N/A N/A Russell 1000 Index 6.5 0.9 15.0 12.4 Russell Multi -Asset Core (CF) 32,073,560 3.9 0.9 8.5 N/A Multi -Asset Core Composite Index 3.5 -2.4 6.7 N/A Russell Multi- Manager Bond (CF) 23,040,911 -0.7 (75) 0.6 (54) 2.1 (37) 4.2 (43) Fixed Income Benchmark -0.6 0.5 1.4 3.2 Russell ST Inv Cash Sweep (CF) 403,902 0.1 0.1 0.0 0.1 BofA Merrill Lynch 3 Month U.S. T -Bill 0.0 0.1 0.1 0.1 Russell Real Estate Equity (CF) 6,418,948 2.9 14.7 14.2 14.1 Real Estate Benchmark 3.4 15.2 13.6 13.5 1 Policy Benchmark (IPS hybrid benchmark objective): March '14 30% MSCI ACWI + 25% Russell 1000 + 32% BC Aggregate + 2% NAREIT + 2% S &P Global Infrastructure Index + 5% NFI ODCE EQ + 2% DJ UBS Commodities + 2% ML 3M T- Bills; prior from May'13 48% MSCI ACWI + 35% BC Aggregate + 5% NAREIT + 5% NFI ODCE EQ + 5% DJ UBS Commodities + 2% ML 3M T- Bills; Marl 2 is 34% Russell 1000 + 11 % Russell Mid -Cap + 11°A) MSCI Net EAFE + 4% MSCI Net EM + 5% FTSE /NAREIT + 30% BC Aggregate + 5% BC TIPS; from Sep'09 was 34% Russell 1000 + 11% Russell Mid -Cap+ 11% MSCI Net EAFE + 4% MSCI Net EM + 5% Wilshire REIT + 30% BC Aggregate + 5% BC TIPS; from May'05 was 34% Russell 1000 + 16% Russell Mid -Cap+ 10% MSCI Net EAFE +5% Wilshire REIT + 30% LB Interm Aggregate + 5% Lehman Interm TIPS; from Jul'02 was 60% S &P 500 + 35 LB Gov't/Credit. 2 The Multi -Asset Core Composite Benchmark: 75.0% Russell World Cap 50% Hedged Net Index / 7.5% Dow Jones UBS Commodity Index / 7.5% FTSE EPRA/NAREIT Developed Real Estate Index (Net) / 7.0% Barclays U.S. Aggregate Bond Index / 3.0% Barclays U.S. 1 -3 Month Treasury Bill Index. This benchmark is appropriate for evaluating the Russell Multi -Asset Core Fund over a 3 to 5 year horizon. 3 Fixed Income Benchmark (IPS fixed income hybrid): Sep'09 is 100% BC Aggregate; from May05 was 100% LB Intermediate Aggregate; from Jun'02 was 100% Lehman Gov't/Credit. 4 Real Estate Benchmark: from Sept'09 is 100% NFI ODCE EQ; prior was 100% NCREIF. BCA 10 L Boynton Beach Police Pension Fund Peer Universe Quartile Ranking December 31, 2015 14.0 11.0 ri 8.0 • • 0 0 E 5.0 cc • v • a> 2.0 c1 I 0 -1.0 -4.0 -7.0 Quarter One Year Three Years Five Years • Total Fund 3.1 (37) 2.4 (5) 8.0 (40) 7.6 (29) V Policy Benchmark 3.0 (43) 0.0 (49) 6.6 (71) 6.9 (56) 5th Percentile 4.1 2.3 9.7 8.7 1st Quartile 3.4 0.8 8.5 7.7 Median 2.8 -0.1 7.6 7.0 3rd Quartile 2.3 -1.0 6.3 6.2 95th Percentile 1.4 -2.3 4.4 5.1 Parentheses contain percentile rankings. l3CA Calculation based on quarterly data. Boynton Beach Police Pension Fund Growth of Investments January 1, 2011 Through December 31, 2015 $96.0 I $90.0 I :::: .. to 0 O � $72.0 r _7 m $66.0 Y f0 . $60.0 _s $54.0 p 1 1 $48.0 $42.0 12/10 3/11 6/11 9/11 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 Total Fund Net Cash Flow Beginning MV Ending MV Annualized ROR $53,507,101 $83,370,726 7.6 BCA 12 Boynton Beach Police Pension Fund Capital Market Line Period Ending December 31, 2015 5 Years Risk/Reward 5 Years Statistics 20 • Total Fund Retum Deviation Beta Alpha 18 Total Fund 7.58 8.02 0.99 0.75 ® Policy Benchmark 15 Policy Benchmark 6.90 7.97 1.00 0.00 Russell 1000 Index 12 ■ Russell 1000 Index 12.44 12.82 1.54 1.90 E • . Russell Midcap Index Russell Midcap Index 11.44 14.72 1.79 -0.51 Ix 9 • 0 Russell 2000 Index Russell 2000 Index 9.19 17.41 2.03 -3.78 •. 6 • ML All Conv Ex.144A AQ Index ML All Conv Ex.144A AQ Index 7.41 10.16 1.20 -0.69 3 o 0 MSCI EAFE Index 4.07 14.33 1.61 -6.08 ° MSCI EAFE Index 0 Barclays Aggregate Index 3.25 2.79 -0.10 3.98 0 2 4 6 8 10 12 14 16 18 20 I Barclays Aggregate Index Risk (Standard Deviation %) 3 Years Risk/Reward 3 Years Statistics 20 • Standard Standard Beta Alpha Total Fund Deviation p 18 Total Fund 7.98 4.66 0.81 2.50 ® Policy Benchmark 15 ■ Policy Benchmark 6.64 5.52 1.00 0.00 • ■ Russell 1000 Index Russell 1000 Index 15.01 9.19 1.50 4.77 12 . Russell Midcap Index Russell Midcap Index 14.18 10.42 1.76 2.38 9 cr • © Russell 2000 Index Russell 2000 Index 11.65 13.68 2.08 -1.69 y 6 0 • ML All Conv Ex.144A AQ Index 9.62 7.63 1.25 1.30 ML All Conv Ex.144A AQ Index 3 MSCI EAFE Index 5.46 11.35 1.72 - 5.29 I ° MSCI EAFE Index Barclays Aggregate Index 1.44 2.72 0.09 0.85 I 0 0 2 4 6 8 10 12 14 16 18 20 I Barclays Aggregate Index Risk (Standard Deviation %) BCA 13 ` _ -- G 0 Boynton Beach Police Pension Fund Fiscal Year Rates of Return September 30, 2004 Through December 31, 2015 30.00 25.00 - .._ ._ ,. 20.00 18.47 15.00 4:23 _..... 11.74 11.83 11.01 10.14 10.00 7.85 0 5.00 cC 1 1 0.29 0.25 5 0.00 m IX -5.00 -10.00 -15.00 -25.00 FYTD FY FY FY FY FY FY FY FY FY FY FY 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 BCA 14 Boynton Beach Police Pension Fund Total Fund December 31, 2015 5 Years Rolling Percentile Ranking - 5 Years Growth of a Dollar o 160 00 25.0 c • • • • • 140.00 c 50.0 • • • • • • • • • ° ' iii •• •• • o cc • • t 120.00 75.0 3 2 c7 J\ 100 100.00 J- \ r 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12115 Periods 5 - 25 25 - 50 50 - 75 75 - 95 80.00 --I----- • Total Fund 20 0 (0 %) 10 (50 %) 10 (50 %) 0 (0 %) 12/10 6/11 12/11 6/12 12/12 6/13 12/13 6/14 12/14 6/15 12/15 V Policy Benchmark 20 1 (5 %) 14 (70 %) 5 (25 %) 0 (0 %) 3 Years Rolling Percentile Ranking - 5 Years Peer Group Risk/Reward - 5 Years 0.0 7.80 25.0 • • • • • - 7.50 - • Y • • • • 2 7.20 cc 50.0 • • • • m V • • K 6.90 7 • 5 g ; V ct 75 Yr” 6.60 7.83 7.92 8 01 8.10 8.19 8.28 8.37 8.46 8.55 100.0 _ Risk (Standard Deviation %) 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Retum Standard Deviation Periods 5 - 25 25 - 50 50 - 75 75 - 95 • Total Fund 7.58 8.02 • Total Fund 20 5 (25 %) 5 (25 %) 10 (50 %) 0 (0 %) • Policy Benchmark 6.90 7.97 • Policy Benchmark 20 6 (30 %) 5 (25 %) 7 (35 %) 2 (10 %) - Median 7.01 8.41 Historical Statistics - 5 Years Retum Standa Sha Down Up Deviation Alpha Beta Ratio rpe Market Market Capture Capture Total Fund 7.58 8.02 0.75 0.99 0.95 92.46 103.59 Policy Benchmark 6.90 797 0.00 1.00 100.00 100.00 Historical Statistics - 3 Years Standard Down U Retum Deviation Alpha Beta S Rat oe Market Market Capture Capture Total Fund 7.98 4.66 2.50 0.81 1.67 56.83 102.90 Policy Benchmark 6.64 0 tl/ 1.00 1.19 100.00 100.00 • BC_A 15 1 Boynton Beach Police Pension Fund Russell Large Cap Defensive Equity (CF) December 31, 2015 1 Year Rolling Percentile Ranking - 5 Years Growth of a Dollar 150.00 1 0.0 25.0 • 0 135.00 • m • O C V ¢ • 50.0 • • • `o .c 120.00 3 • 75.0 3 C7 /` 105.00 ..... / 1 100.0 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 121 Periods 5 - 25 25 - 50 50 - 75 75 - 95 90 • Russell Large Cap Defensive Equity (CF) 6 0 (0 %) 3 (50 %; 3 (50 %; 0 (0 %) 8/13 11/13 2/14 5/14 8/14 11/14 2/15 5/15 8/15 12/15 f Russell 1000 Index 20 0 (0 %) 13 (65 %; 7 (35 %; 0 (0 %) 1 Quarter Rolling Percentile Ranking - 5 Years Peer Group Risk/Reward - 1 Year 0.0 a 3.00 .00 • • 25.0 • ,. 2.00 `m E 50.0 • • `` 1.00 • m cc • • 0.00 ! ! ! 75.0 10.58 11.04 11.50 11.96 2.42 12.88 13.34 13.80 Risk (Standard Deviation %) 100.0 ! t rd Retum Standa 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Stan • Russell Large Cap Defensive Equity (CF) 3.19 11.22 Periods 5 - 25 25 - 50 50 - 75 75 - 95 ° • Russell 1000 Index 0.92 12.81 • Russell Large Cap Defensive Equity (CF) 9 1 (11 %; 4 (44 %; 3 (33 %; 1 (11%; 0.95 12.8 • Russell 1000 Index 20 0 (0%) 11 (55 %; 9 (45% 0 (0 %) - Median Historical Statistics -1 Year Down Up Sharpe Market Market Return Standard Alpha Beta Ra tio Capture Capture Deviation 0.86 0 78.15 91.46 Russell Large Cap Defensive Equity (CF) 3.19 11.22 2.30 1 6 Russell 1000 Index 0.92 11. 1.00 0.13 100.00 Historical Statistics -1 Quarter Down Up Sharpe Market Market Standard Alpha Beta Ratio C lure Capture Retum Deviation p 0 0.82 0.62 4026 85.33 Russell Large Cap Defensive Equity (CF) 6.42 3 100 26 1 85 . 33 Russell 1000 Index 6.50 4.25 0.00 1.00 0.52 16 Boynton Beach Police Pension Fund Russell Multi -Asset Core (CF) December 31, 2015 3 Years Rolling Percentile Ranking - 5 Years Growth of a Dollar 0.0 160.00 25.0 • 0 IIH\l‘ Y 140.00 m " ¢ o • 50.0 V Y tr 75.0 r 120.00 0 ' i 100.0 $ 100.00 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 i Periods 5 - 25 25 - 50 50 - 75 75 - 95 8000 • Russell Multi - Asset Core (CF) 2 0 (0 %) 2 (100% 0 (0 %) 0 (0 %) 7/12 1/13 7/13 1/14 7/14 1/15 7/15 12/15 • Multi -Asset Core Composite Index 2 0 (0 %) 0 (0 %) 2 (100% 0 (0 %) 1 Year Rolling Percentile Ranking - 5 Years Peer Group Risk/Reward - 3 Years 0.0 9.45 • • 8.82 25.0 - • • • • 8.19 • Y • ` • 50.0 • • m 7.56 ... Ce 9 Y • 6.93 IX 75.0 6.30 t 7.26 7.48 7.70 7.92 8.14 8.36 8.58 8.80 9.02 100.0 Risk (Standard Deviation %) 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Return Standard Deviation Periods 5 - 25 25 - 50 50 - 75 75 - 95 • Russell Multi -Asset Core (CF) 8.46 8.28 • Russell Multi -Asset Core (CF) 10 3 (30 %) 6 (60 %) 1 (10 %) 0 (0 %) • Multi -Asset Core Composite Index 6.72 8.66 ✓ Multi -Asset Core Composite Index 10 0 (0 %) 5 (50 %) 3 (30 %) 2 (20 %) - Median 6.95 7.59 Historical Statistics - 3 Years Standar Sharpe Down Up Retum Deviation Alpha Bet SRatio Market Market Capture Capture Russell Multi - Asset Core (CF) 8.46 8.28 1.96 0.95 1.02 88.57 103.45 Multi -Asset Core Composite Index 6.72 8.66 0.00 1.00 0.79 100.00 100.00 Historical Statistics - 1 Year Standard Down Up Retum Deviation Alpha Beta Sharp Market Market Ratio Capture P Capture Russell Multi - Asset Core (CF) 0.89 9.92 3.24 0.95 0.14 84.19 107.46 Multi -Asset Core Composite Index -2.44 10.48 0.00 1.00 -0.19 100.00 100.00 i I BCA 17 I __. Boynton Beach Police Pension Fund Russell Multi- Manager Bond (CF) December 31, 2015 5 Years Rolling Percentile Ranking - 5 Years Growth of a Dollar 0.0 130.00 25.0 cc i E E 50.0 K 100.0 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Periods 5 - 25 25 - 50 50 - 75 75 - 95 90.00 • Russell Multi Manager Bond (CF) 10 0 (0 %) 10 (100% 0 (0 %) 0 (0 %) 12/10 6/11 12/11 6/12 12/12 6/13 12/13 6/14 12/14 6/15 12/15 • Fixed Income Benchmark 20 0 (0 %) 2 (10 %) 18 (90 %) 0 (0 %) 3 Years Rolling Percentile Ranking - 5 Years Peer Group Risk/Reward - 5 Years 0.0 4.62 4.29 • Y ¢ 25.0 • • • • • • • • • • . • • • • • • • • • • • m 3.63 50.0 • • cc 3.30 V cc 75.0 2.97 1 2.64 2.68 2.72 2.76 2.80 2.84 2.88 Risk (Standard Deviation %) 100.0 7 y g t I 1 I 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Retum Standard Deviation Periods 5 - 25 25 - 50 50 - 75 75 - 95 • Russell Multi - Manager Bond (CF) 4.15 2.84 • Russell Multi- Manager Bond (CF) 18 0 (0 %) 18 (100% 0 (0 %) 0 (0 %) • Fixed Income Benchmark 3.25 2.68 • Fixed Income Benchmark 20 0 (0 %) 0 (0 %) 20 (100% 0 (0 %) - Median 3.86 2.77 Historical Statistics - 5 Years Standard Sharpe Doom Up Return Deviation Alpha Beta Ratio Market Market Capture Capture Russell Multi- Manager Bond (CF) 4.15 2.84 0.95 0.98 1.43 95.63 114.37 Fixed Income Benchmark 3.25 0.00 1.00 1.18 100.00 100.00 . Historical Statistics - 3 Years Down Up Return Standard Alpha Beta Sharpe Market Market Deviation Ratio Capture Capture Russell Multi- Manager Bond (CF) 2.10 3.11 0.58 1.05 0.67 101.01 114.38 Fixed Income Benchmark 1.44 2.88 1.00 0.50 100.00 100.00 I;C.A ,' 18 u Boynton Beach Police Pension Fund Russell Real Estate Equity (CF) December 31, 2015 5 Years Rolling Percentile Ranking - 5 Years Growth of a Dollar 0.0 250.00 . 25.0 V c 200.00 �- W O E 50.0 • • • • • • • • • • • ; • • • • • • `o 11, NW cc .c 150.00 75.0 ; 2 (7 100.0 100.00 ` 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Periods 5 - 25 25 - 50 50 - 75 75 - 95 50.00 • ■ Russell Real Estate Equity (CF) 19 0 (0 %) 8 (42 %) 1 1 (58 %) 0 (0 %) 12/10 6/11 12/11 6/12 12/12 6/13 12113 6/14 12/14 6/15 12115 v Real Estate Benchmark 20 11 (55 %) 2 (10 %) 6 (30 %) 1 (5 %) 3 Years Rolling Percentile Ranking - 5 Years Peer Group Risk/Reward - 5 Years 0.0 lir - 1a.7z 14.40 25.0 F Y • E 14.08 E 50.0 • • • • • • • • ¢ 13.76 • :. �... • • • • 13.44 V cC 75.0 13.12 0.80 1.00 1.20 1.40 1.60 1.80 2.00 2.20 100.0 Risk (Standard Deviation %) 3/11 9/11 3/12 9/12 3/13 9/13 3/14 9/14 3/15 12/15 Return Standard Deviation Periods 5 - 25 25 - 50 50 - 75 75 - 95 • Russell Real Estate Equity (CF) 14.10 1.42 • Russell Real Estate Equity (CF) 20 0 (0 %) 5 (25 %) 15 (75 %) 0 (0 %) v Real Estate Benchmark 13.54 1.12 y Real Estate Benchmark 20 4 (20 %) 2 (10 %) 13 (65 %) 1 (5 %) _ Median 14.38 1.89 Historical Statistics - 5 Years Standard Sharpe Down Up Retum Deviation Alpha Beta Ratio Market Market Capture Capture Russell Real Estate Equity (CF) 14.10 1.42 -1.08 1.12 9.43 N/A 103.96 Real Estate Benchmark 13.54 1.12 0.00 i. uG 11.55 N/A 100.00 Historical Statistics - 3 Years p Sharpe Down U Retum Deviation Alpha Beta Ratio Market Market Capture Capture Russell Real Estate Equity (CF) 14.19 1.20 -0.03 1.05 11.25 N/A 104.26 Real Estate Benchmark 13.59 0.00 1.00 15.13 N/A 100.00 BCA 19 Boynton Beach Police Pension Fund Glossary December 31, 2015 - ACCRUED INTEREST- Bond interest earned since the last interest payment, but not yet received. - ALPHA- A linear regressive constant that measures expected return independent of Beta. -ASSET ALLOCATION- The division of portfolio asset classes in order to achieve an expected investment objective. - BALANCED UNIVERSES - BNY Mellon Public Funds, Endowments & Foundations, Corporate peer groups, and PSN peer groups. -BETA- A measure of portfolio sensitivity (volatility) in relation to the market, based upon past experience. -BOND DURATION- A measure of portfolio sensitivity to interest rate risk. - COMMINGLED FUND- An investment fund which is similar to a mutual fund in that investors are permitted to purchase and redeem units that represent ownership in a pool of securities. - CONVERTIBLE BONDS - Hybrid securities' that offer equity returns during rising equity markets and improved down - market protection. -CORE- An equal weighting in both growth and value stocks. - CORRELATION COEFFICIENT- A measure of how two assets move together. The measure is bounded by +1 and -1; +1 means that the two assets move together positively, while a measure of -1 means that the assets are perfectly negatively correlated. - GROWTH MANAGER- Generally invests in companies that have either experienced above - average growth rates and /or are expected to experience above - average growth rates in the future. Growth portfolios tend to have high price /earnings ratios and generally pay little to no dividends. - INDEXES- Indexes are used as "independent representations of markets" (e.g., S &P 500). - INFORMATION RATIO- Annualized excess return above the benchmark relative to the annualized tracking error. -LARGE CAP- Generally, the term refers to a company that has a market capitalization that exceeds $10 billion. - MANAGER UNIVERSE- A collection of quarterly investment returns from various investment management firms that may be subdivided by style (e.g. growth, value, core). -MID CAP- Generally, the term refers to a company that has a market capitalization between $2 and $10 billion. - NCREIF - A quarterly time series composite total rate of return measure of investment performance of a large pool of individual commercial real estate properties acquired in the private market for investment purposes only. - NCREIF ODCE - Open End Diversified Core Equity index which consists of historical and current returns from 26 open -end commingled funds pursuing core strategy. This index is capitalization weighted, time weighted and gross of fees. -NET- Investment return accounts only for manager fees. - PROTECTING FLORIDA INVESTMENT ACT (PFIA) - SBA publishes a list of prohibited investments (scrutinized companies). -RATE OF RETURN- The percentage change in the value of an investment in a portfolio over a specified time period, excluding contributions. -RISK MEASURES- Measures of the investment risk level, including beta, credit, duration, standard deviation, and others that are based on current and historical data. -R- SQUARED- Measures how closely portfolio returns and those of the market are correlated, or how much variation in the portfolio returns may be explained by the market. An R2 of 40 means that 40% of the variation in a fund's price changes could be attributed to changes in the market index over the time period. BCA 20 L Boynton Beach Police Pension Fund Glossary December 31, 2015 - SHARPE RATIO- The ratio of the rate of return earned above the risk -free rate to the standard deviation of the portfolio. It measures the number of units of return per unit of risk. -SMALL CAP- Generally refers to a company with a market capitalization $300 million to $2 billion. - STANDARD DEVIATION- Measure of the variability (dispersion) of historical returns around the mean. It measures how much exposure to volatility was experienced by the implementation of an investment strategy. - SYSTEMATIC RISK- Measured by beta, it is the risk that cannot be diversified away (market risk). -TIME WEIGHTED (TW) RETURN - A measure of the investments versus the investor. When there are no flows the TW & DOLLAR weighted (DW) returns are the same and vice versa. - TRACKING ERROR- A measure of how closely a manager's performance tracks an index; it is the annualized standard deviation of the differences between the quarterly returns for the manager and the benchmark. - TREYNOR RATIO- A measure of reward per unit of risk. (excess return divided by beta). -UP AND DOWN- MARKET CAPTURE RATIO- Ratio that illustrates how a manager performed relative to the market during rising and declining market periods. -VALUE MANAGER- Generally invests in companies that have low price -to- earnings and price -to -book ratios and /or above - average dividend yields. BCA 21 Boynton Beach Police Pension Fund Disclosure December 31, 2015 Advisory services are offered through or by Burgess Chambers and Associates, Inc., a registered SEC investment advisor. Performance Reporting: 1.Changes in portfolio valuations due to capital gains or losses, dividends, interest, income and management fees are included in the calculation of returns. All calculations are made in accordance with generally accepted industry standards. 2.Transaction costs, such as commissions, are included in the purchase cost or deducted from the proceeds or sale of a security. Differences in transaction costs may affect comparisons. 3.Individual client returns may vary due to a variety of factors, including differences in investment objectives, asset allocating and timing of investment decisions. 4.Performance reports are generated from information supplied by the client, custodian, and /or investment managers. BCA relies upon the accuracy of this data when preparing reports. 5.The market indexes do not include transaction costs, and an investment in a product similar to the index would have lower performance dependent upon costs, fees, dividend reinvestments, and timing. Benchmarks and indexes are for comparison purposes only, and there is no assurance or guarantee that such performance will be achieved. 6.Performance information prepared by third party sources may differ from that shown by BCA. These differences may be due to different methods of analysis, different time periods being evaluated, different pricing sources for securities, treatment of accrued income, treatment of cash, and different accounting procedures. 7.Certain valuations, such as alternative assets, ETF, and mutual funds, are prepared based on information from third party sources, the accuracy of such information cannot be guaranteed by BCA. f Such data may include estimates and maybe subject to revision. 8.BCA has not reviewed the risks of individual security holdings. 9.BCA investment reports are not indicative of future results. 10. For a free copy of Part II (mailed w/i 5 bus. days from request receipt) of Burgess Chambers & Associates, Inc.'s most recent Form ADV which details pertinent business procedures, please contact: 315 East Robinson Street Suite #690, Orlando, Florida 32801, 407 - 644 -0111, info @burgesschambers.com. BCA 22 1 Burgess Chambers & Associates, Inc. Institutional Investment Advisors www. burg esschambers. com 315 East Robinson Street, Suite 690, Orlando, Florida 32801 P: 407- 644 -0111 F: 407- 644 -0694 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 1 8/11/2015 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement The below listed performance measures will be used as objective criteria for evaluating 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 2 8/11/2015 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement attempt will be made to match investment maturities with known cash needs and anticipated 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 3 8/11/2015 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement c. Hedge funds 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 4 8/11/2015 BOYNTON BEACH POLICE OFFICERS' PENSION FUND Investment Policy Statement performance of an investment manager may be made. With this in mind, the following are 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 8/11/2015 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 8/11/2015 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 T RNA`I'N Private Real Estate 5 0 — 710 Public Real Estate (REITs) 2 0 — 7 Listed Infrastructure 2 0 — 5 Commodities (CCFs) 2 0 — 7 0 NOTE: Foreign securities are limited to 25 /o of the pension fund at market value. g P 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: a' As: Chairman, Board of Trustees As: Inves nt Manager Date: 5 / // / /.5 Date: ° 1 i BURGESS CHAMBERS & ASSOCIATES, INC. B - r°1416 As: Reg' : ered Advisor Date: �/ (///5 7 8/11/2015 i4 • 1 BICHLER, KELLEY, OLIVER LONGO & FOX, PLLC December 22, 2015 Bonni Jensen, Esquire Perry & Jensen, LLC 400 Executive Center Drive, Suite 207 West Palm Beach, FL 33401 -2922 • Re: Employee: Robert Kellman Employer: • Boynton Beach Police. Department . Dear Ms. Jensen: Please be advised that I represent Robert Kellman with regard to his claim for a line of duty disability benefit, Please accept this letter as my formal Notice of Appearance. It is my understanding that Mr. Kellman has already submitted his application, physician statements and interrogatories and has a pension hearing scheduled on February 9, 2016, at 10:30 a.m. Please provide me with a copy of all of the documents filed by Mr. Kellman as well as any information the pension board has in regard to this claim. I look forward to hearing from you in this regard. Sincerely, Paul A. Kelley PAKIbk cc: Barbara La Due (Via Email) WWW.BICHLERLAW.COM 541 SOUTH ORLANDO AVENUE, SUITE 310, MAITLAND, FL 32751 PHONE 407- 599 -3777 FAX 407- 599 -3780 TOLL FREE 886 -245 -8977 P R O T E C T I N G T H O S E W H O P R O T E C T A N D S E R V E BOYNTON BEACH POLICE PENSION FUND APPLICATION FOR DISABILI�°YIPENSION BENEFITS PLEASE PRINT OR TYPE I/ „/ 1. a. Name of Emptoyee:, 4 MAil _ '(Last) (First) (MI) b. Social Security Number. c. Date of Birth: (Attach proof) Month- Day -Year d. Home Telephone Number: 9 6 — — (Area Code) Numbe e. Home Address: ° _ _ Address tree S Zip Code f. Permanent address to which check and/or correspondence should be sent _ _ • r te__ ' Street Address » State Zip Code 2. a. Are you currently married: No If yes, please complete the following: • 1. Name of Spouse: (Last) (First) (MI) ii. Spouse's Social Security Number: L • iii. Spouse's Date of Birth: (Attach proof) Mo to of Marriage: ' i R (Attach proof) iV Date g 1 � ( p Month - Day -Year Page 1of4 3. Names and Dates of Birth of Child(ren): • Name Date of Birth (Attach additional page if needed) 4. Names of Your Living Parents: a. Mother. __= b. Father. 5. a. Date of Hire by the City of Boynton Beach, Florida, as a Sworn Police Officer. - 0 Li Month -Day- -Year b. Current Position: Tb L j Q / c l�- 6. I plan to retire on: Month -Day- -Year 7. Type of retirement for which you are applying (check one): Normal Retirement Early Retirement Line-of-Duty Disability - p Th 6 IQ i -xp-o--s - Non - Line -of -Duty Disability 8. if you are applying for a disability refinement, please complete the following: a. Date disability commenced: b. Nature and cause of disability: i -r- tk Le la t Page 2 of 4 c. Did your disability result from any of the following: Yes No (1) Use of drugs, intoxicants or narcotics? (2) Due to _a fight, riot, civil insurrection, or crime? (3) From an injury or disease sustained while you were serving in any armed forces? (4) After your employment with the City of Boynton Beach terminated? (5) While working for anyone other than the City of Boynton Beach and arising out of such k / employment? d. A copy of my doctor's medical opinion is attached. e. Please list any doctor's that have treated you within the last five years and their address and ' hone 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 line -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 AcKnowleaaments I 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 fled with the Board of Trustees and 1 hereby certify its accuracy. If 1 desire to change my designated beneficiary(ies). I will Me a new Designation of Beneficiary Form with this Application. I hereby authorize the release of any and all medical records including but not to the complete history records in possession of all doctors listed below concerning my illness andior 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. 1 understand that the Board(s) will rely upon this waiver and that 1 will not be able to withdraw same at a later date. 1 agree to cooperate fully with the Board of Tnrstees 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 claims, 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 / 7 d ay of, , �U AMA . 20 `& // yy , _ s Ignature of Pardciipaa Witnes Printed name of Participant STATE OF FLORIDA COUNTY OF PALM BEACH J SWO N �O ( and subscribed before me this 1`1da of ' ` ,ZC K 4�. by r ocs personally known to J -or- who produced the following identification: / "eelf-Le___ Notary Public Print, type or stamp � Iyi g1'4p addition to sear. .4ssioN o �'oet 26, 2o 9 ` v Zi .. :a= Page 4 of .4 2 ' I i t1\ Barbara Ladue • From: Bonni Jensen <bonni @robertdklausner.com> Sent: Wednesday, January 13, 2016 11:50 AM To: Barbara Kelley; Paul Kelley Cc: ladueb @bbpdpension.com; bsjteam; Athol, Toby; Ilopisj @bbfl.us Subject: RE: Keliman, Robert v. Boynton Beach Police Officers' Pension Fund (Pension) -: Paul and Barbara, Thanks for the letter. I see that you were copied on the documents that I received regarding Mr. Keliman. Barbara LaDue's email of January 12, 2016 represents the first documetns that I received to begin processing Mr. Kellman's application. As such, there is no hearing scheduled on Mr. Kellman's application. The Board may discuss the filing of the application at the upcoming quarterly meeting but this matter is not ripe for any real discussion or decision. Of course, you and your client are welcome to attend the meeting. If we can accommodate you by arranging for an electronic appearance, please let me know. The documents that I received from Barbara LaDue, in the email that you were copied on, are the only documents that I have. Based on Barbara LaDue's email, I will review the application and begin processing, provided all of the information required to begin has been received. Please contact me if you have any questions. To make sure that your email is handled in a timely manner, please copy BSJTearn@robertdklausner.com. Bonni S. Jensen Klausner, Kaufman, Jensen & Levinson 7080 N.W. 4 Street Plantation, Florida 33317 Telephone: 954 - 916 -1202 Facsimile: 954 - 916 -1232 bonni a(�.robertdklausner.com i s a L f \r CONFIDENTIALITY NOTICE: This communication is confidential, may be privileged and is meant only for the intended recipient. If you are not the intended recipient, please notify the sender ASAP and delete this message from your system. IRS CIRCULAR 230 NOTICE: To the extent that this message or any attachment concerns tax matters, it is not intended to be used and cannot be used by a taxpayer for the purpose of avoiding penalties that may be imposed by law. From: Barbara Kelley [ maiito :Barbaraftbichierlaw.com] Sent: Monday, January 11, 2016 5:50 PM To: bsiensen©perryjenseniaw.com 1 Cc: ladueb bbpdpension.com Subject Kellman, Robert v. Boynton Beach Police Officers' Pension Fund (Pension) -: 1 : Good afternoon: Paul asked me to send the attached letter to you to confirm your receipt. He wanted to make sure your office had received this to put you on notice of Mr. Kellman's representation. We look forward to hearing from you in this regard. Have a great evening. Barb Barbara Kelley, Legal Assistant to Paul A. Kelley, Esquire go T Bichler, Kelley, Oliver, Longo & Fox PLLC 541 South Orlando Avenue, Suite 310 Maitland, Florida 32751 866 - 245 -8977 toll free 407 -599 -3777 office Paralegal, Barbara, Ext. 1015 407 -599 -3780 fax Paul @bicl Barbara@bichlerlaw.com BST :R : This communication, together with any attachments, may contain legally privileged and confidential information. It is intended only for the use of the above p e rs o n o r p e rs o n s If you are not the intended recipient, you are hereby notified that any review, dissemination, d or duplication of this communication is strictly prohibited If you have received this communication in error, please notify the sender immediately either by telephone, 407-59g-377Z or reply e-mail, anclimmecliately destroy all copies of this communication and any attachments 2 Barbara Ladue From: Barbara Ladue <ladueb @bbpdpension.com> Sent: Tuesday, January 12, 2016 9:27 AM To: Bonni Jensen (bonni @robertdklausner.com); paul @bichlerlaw.com; 'Athol, Toby' Cc: barbara @bichierlaw.com; Pat Holt (bsjteam @robertdklausner.com) Subject: Boynton Police - Robert Kellman Pension Disability Claim - LOD Attachments: D00011216.pdf Robert Kellman was terminated employment by the City of Boynton Beach on 10 -24 -2015. He has applied for LOD disability pension on November 17, 2015 as reflected on the attachment. The attachment includes the following: 1) Application for Disability /Pension Benefits (4 pages) 2) Interrogatories for Disability Pension Benefits (11 pages) 3) HIPPA Release form (1 page) The pension file does not contain any statements from doctors. • • Bonni Jensen, Attorney for the Boynton Beach Police Officers' Pension Fund, will review and provide the guidance /management for this disability procedure. Will keep everyone updated. Barb La Due Pension Administrator Boynton Beach Police & Fire Pension Funds Phone: (561) 739.7972 - - -- Original Message From: Scanner [ mailto:faxexecsuites @Rmail.com) Sent: Tuesday, January 12, 2016 9:50 AM To: BARBARA LADUE Subject: Send data from MFP07580425 01/12/2016 09:50 Scanned from MFP07580425 Date:01/12/2016 09:50 Pages:16 Resolution:200x200 DPI 1 I'. 11 i $. = P P d Q/ :p' N a - !:ff 1 "ij;',1 III!! • ; t \"; r p 4 hi I 4 .1 ts I I 1 . 1 11 il . [ I a § lig o I el 52 8 f rdli ihh- hi ll n 1 z gen la g a Fro 11 I it 1.t. 'N rill. ni I OA 11 11141 girt. 1.21: w a a 1 1 1N 11111 i O � 0 I H.„ - BOYNTON BEACH POLICE OFFICERS' PENSION FUND INTERROGATORIES FOR DISABILITY PENSION BENEFITS PLEASE PRINT OR TYPE Name of Employee: i;L WI- Ai 10- (Last) (First) (MI) Date of Birth: ' Home Telephone Number: (Area Code) Number Home Address: Number PLEASE ANSWER ALL QUESTIONS UNDER OATH: 1. What is the title your position or your job description? pi) y z` 2. Please describe exactly how you were injuredfcontracted illness, providing specifics as to date, time and place: a. Provide names and addresses of all witnesses. b. Nature of your injuryrllness. i A1� ► — I 1 —I 7 i Page 1 of 11 3. Was injury/illness reported to the Boyntotr Beach Police Department and if so, state date reported and to whom: cS b 27 -r� 'D -R r nt / rL 579 �c� � D61- ', 0 t\I 4. Please state whether you are claiming the injury /liness to be: a. Total and Permanent [ 5. Please specifically describe any and all previous conditions that you have had, even though they may not be directly associated with the condition on which your claim is based. For each condition, provide the following (attach a separate sheet if necessary): a. Specifically when you had the condition. b. Names, addresses and phone numbers of all health care providers with whom you have consulted or who treated you. c.. The diagnosis. pep-AAitivsw-n_ y y d. The prognosis. e. Dates of treatment. crTA LAS 2 -6 1 S, b c5 -- - 2 15 f. Nature of treatment. i `P &T / EV-A l 1 g. Medications prescribed h. Names, addresses and telephone numbers of all persons who may have knowledge of such condition. 6. Please provide the names, addresses and telephone numbers of all health care providers who have treated you for the condition upon which your claim is based and any condition related to it. Please provide the following: a. A brief description of what you were treated for b. The diagnosis ��/✓�� tvri 7/ VA(F T � Ck1 c. The prognosis d. Dates of treatment li - 1 6 I – 2)S e. Nature of treatm ent. _ r D ur `/ f. Medications prescribed. g. Names, addresses and telephone numbers of all persons who may have knowledge of such condition. Page 3 of 11 7. Have you been involved in an automobile or other vehicular accident requiring medical treatment? If so, please provide: b a. When accident occurred: J f -ij-- b. Where and when accident occurred: c. How accident occurred: d (4_ d. Whether you were injured: I e. How you were injured: 1 49: f. Was accident job related: d (44 g. Names, addresses and telephone numbers of all health care providers who treated you. t� i. Diagnosis Page 4 of 11 ii. Prognosis w • M. Medications prescribed N I iv. Nature of treatment Nifdl._ v., Nature of treatment 4 vi. Dates of treatment. N 4 8. Names, addresses and telephone numbers of all persons who may have knowledge of injuries resulting from the accident. . d (4 9. Have you ever had a fall, collision, sports injury/illness or other accident which required treatment by a health care provider? If so, please provide: d a. A description of the incident: A b. Where and when it occurred: 1 4 -461- Page 5 of 11 c. How it occurred: wI .. d. Whether you were injured: RI e. How you were injured: ftt (-4- f. Was it job related: 1� f g. Names, addresses and telephone numbers of all health care providers who treated you: J L Diagnosis 14- Page 6 of 11 H. Prognosis iii. Medications prescribed 11 if iv. Nature of treatment Pi v. Dates of treatment 16 vi. Names, addresses and telephone numbers of all persons who may have knowledge of injuries resulting from the accident. 10. Please provide names, addresses and dates of all prior and current employers, including self - employment. - Th1 ) - a. Nature of work involved with employment Page 7of 11 b. Status of each employment (terminated, retired, continuing, etc) +h -io 2 r/( d Ai " ' Ll — i 6k),o c. Basis or reason for any termination of employment. • 11. Were you suffering any injuryrllness, disease, or disability at the time of the accident, incident or condition for which you are applying for disability retirement? 12. Describe all records of the accident or incident forming the basis of your application, including, traffic accident reports, police reports, notice of injury/illness, hospital records etc. (lli 13. Provide the name and address of all health care providers who have advised you that you are permanently and totally incapable of performing useful and efficient service as a Police Officer as a result of the condition or injury/illness which -is the basis of your claim for disability retirement. 7,1 Ai6 Page 8 of 11 14. Provide the name and address of all health care providers who have advised you that you are not permanently and totally incapable of performing useful and efficient service as a Police Officer as a result of the condition or injury/illness which is he basis of your claim for disability retirement. 61 AI 15. State the date on which you reached malamum medical improvement (MMI) for workers' compensation purposes and provide the names and addresses of all health care providers who have advised that you have reached MMI. i1/41 16. Provide the names and addresses of all health care providers who have advised that you have not reached MMI. 1' f_p 17. Has a sworn statement or testimony been taken in connection with any claim arising out of the injury /illness or condition which is the basis for your claim for disability. If so, state the date taken and by whom. it, Page9of 11 18. Is there any other information known to you or your agents, which might be relevant to your application for disability retirement? If so, please specify. 19. Have you ever applied forworkers' compensation benefits in anyjurisdicction2 If so, please state for each application: P-17 a1 VO ,Ptf,0 w 1/bucal imoui a. The name and address of the employer f F J ,SOPf -- Ca L Lt7 b. The date of the application & f / c. Determination of the application \J46 Gia) 1 d. The dates of receipt of benefits. V - )A0 20. Describe in detail why you feel that you are permanently and totally unable physically or mentally from performing useful and efficient service as a Police Officer. Page 10 of 11 Acknowledgments I 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 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 l will not be able to withdraw same at a later date. I hereby agree to indemnify and hold harmless the Pension Plan from and against any and all claims, demands, or causes of action of any kind or nature resulting from or in connection with the Boand'suse of my medical records to process my application, and from and against any resulting losses, costs, expenses, reasonable attorneys' fees, liabilities, damages, orders, judgments, or decrees in connection therewith. I understand that I have a continuing duty to immediately supplement this questionnaire in writing with any new or additional information obtained. Dated this /7 - day of / , 20 coutAim f6asop 9,4 /"..d Witness Signature of Participant ‘ . vn RA, Witn _',. Printed name of Participant STATE OF FLORIDA COUNTY OF SWORN TO (or AFFIRMED) AND SUBSCRIBED before me this l 7 `` — day of e a.e .lee 20/2 b wi,b,- . (Participant) who is: p 6 Personally known to me - OR - who [ j produced the following identification: v OBAR,4 4 Specify) . e of 'dentification produced � G° issisy �Q�,Fr a BEf lt e re d / / .�� . =Z : � m c / 4d.4/ Gil s� i #EEsa :' Si . nature of'.Notary Print; type or agicialkip,91 MORK* addition to seal �� • +:. de ett. H:IBB Police 0188 ORMS- Standard tntenogatodes (2015).wpd • Page 11 of 11 • FLORIDA DEPARTMENT OFMANAGEMENTSERVICES Bureau of Local Retirement Systems 4 �,jr p Local Retirement Section c 5 ret e re r Y i e nt P.O. Box 9000 We serve those who serve Florida Tallahassee, FL 32315 -9000 Tel: 850.488.2784 1 Fax: 850.921.2161 1 Toll -Free: 877.738.5622 Rick Scott, Govemor Chad Poppet!, Secretary November 17, 2015 Mr. Toby Athol City of Boynton Beach Municipal Police Officers' Retirement Fund 1500 Gateway Blvd., Suite 220 Boynton Beach, FL 33426 RE: City of Boynton Beach Municipal Police Officers' Retirement Fund State Acceptance - All reports through 10/1/2014 Dear Mr. Athol: The above - referenced plan has been determined to be state - accepted pursuant to Part VII of Chapter 112, F.S. and Chapter 60T, F.A.C. By this determination, all prior actuarial reports and impact statements effective prior to the above date and received by the Division of Retirement may be considered to be state- accepted. We agree with your actuary's recommendation of lowering the assumed interest rate assumption as stated on page 2 of the 10/1/2014 actuarial valuation. This assumption should be reviewed before the subsequent valuation is completed. This review relied upon the actuarial costs and asset amounts as determined by the Plan actuary in the referenced actuarial reports. Although I reviewed the results of the reports for compliance, consistency and reasonableness, I did not audit the asset information or employee data information for accuracy. Accordingly, I express no opinion on the reasonableness of the estimates of the financial status of the plan. An audit may or may not uncover additional material issues in the actuarial work performed. Should you have any questions, please do not hesitate to call us. Sincerely, EA.A.,a 71 Douglas E. Beckendorf, A.S.A., E.A. Actuary cc: Mr. Peter Strong, Plan Actuary Ms. Barbara La Due, Plan Administrator Ms. Bonni S. Jensen, Plan Attorney Mr. Tim W. Howard, Boynton Beach Finance Director Mr. Gerald Taylor, Boynton Beach Mayor Mr. Jason Llopis, Plan Secretary Ms. Sarah Carr, Division of Retirement • Barbara Ladue From: Beckendorf, Douglas < Douglas .Beckendorf @dms.myflorida.com> Sent: Tuesday, November 17, 2015 11:13 AM To: 'athol- atholt @bbfl.us' Cc: 'pete.strong @gabrielroeder.com'; 'Iadueb @bbpdpension.com'; 'Bonni @RobertDKlausner.com'; 'howardt @bbfl.us'; 'taylorj @bbfl.us'; 'llopisj @bbfl.us' Subject: City of Boynton Beach Municipal Police Officers' Retirement Fund: State Acceptance and summary of contact information dated 11/17/2015 Attachments: Mr. Toby Athol-11-17-2015.pdf; Contacts- 11- 17- 2015.pdf Attached is the state acceptance and summary of contact information for the City of Boynton Beach Municipal Police Officers' Retirement Fund. Call with any questions regarding this correspondence. Doug Beckendorf, A.S.A., E.A. Actuary, Bureau of Local Retirement Systems Florida Division of Retirement P.O. Box 9000 Tallahassee, FL 32315 -9000 Phone: (850) 778 -4605 Toll Free: (877) 738 -5622 Fax: (850) 410 -2172 Email: douglas .beckendorf @dms.myflorida.com "We serve those who serve Florida" DISCLAIMER NOTICE: This email, along with any included attachment(s), is intended for use only by the person(s) or entity to which it is addressed This message may contain confidential, proprietary, and/or legally privileged information. If you are not the intended recipient of this message, we apologize for any inconvenience this may have caused You are hereby notified that you are prohibited from printing, copying, storing, disseminating or distributing this communication. If you received this communication in error, please notify the sender by email or by telephone at (850) 488 -5540 or toll free at (866) 738 -2366 if Tallahassee is not a local call for you. All record of the communication you received in error (electronic or otherwise) should be destroyed in its entirety. Thank you for your cooperation and assistance in this matter. 1 STATE STREE r � Retiree Services P.O. Box 24989 Jacksonville, FL 32241 -4989 November 27, 2015 Barbara LaDue City of Boynton Beach Boynton Police & Fire Pension Funds 1500 Gateway Boulevard, #220 Boynton Beach, FL 33435 Dear Ms. LaDue: In order to assist you in the management of your Pension Plan, we conducted an audit of our records. Our objective is to report discrepancies in the payment of benefits and to ensure that a valid social security number is used by beneficiaries.. Retiree Services utilizes the services of The Berwyn Group, an organization that provides mortality identification in addition to address location and death certificate obtainer services. The Berwyn Group performed this audit on behalf of Retiree Services, matching their database of death records against our data to identify the social security numbers of deceased participants. The results of this audit are enclosed for your review. Additionally, The Berwyn Group's reports are designed to provide detailed information, categorized to assist you in your review and research of audit findings. Please pay particular attention to the following detail, which will enable you to review the data in the most efficient manner. Reports are sorted and bound by the first 10 characters of your Retiree Services account ID. Consequently, you may have received one or multiple reports. Within each report, results are categorized into the following four areas: • "Exact Matches" where Retiree Services supplied social security number, last name, first name and date of birth all match a record in The Berwyn Group's database exactly. • "Highly Probable Matches" where Retiree Services supplied social security number, valid or invalid last name and first name (but not date of birth) all match a record in The Berwyn Group's database exactly. • "Other Matches" where Retiree Services supplied social security number only or social security number and one other field match a record in The Berwyn Group's database exactly. • "Invalid Social Security Numbers" where Retiree Services supplied social security numbers are not valid. PERSONAL SENSITIVE DATA State Street Retiree Services November 27, 2015 Page 2 Within each of these four areas, results are sorted by Retiree Services account ID. • "No Matches Found for the Entire Company" where Retiree Services supplied social security number valid or invalid, last name, first name and there were no matches. Your report will indicate the number of records searched with zero matches. Once you have determined the payment eligibility of the participants in the report(s) provided, please advise your benefit associate as to what action you wish us to take. Your benefit associate will terminate payments and /or correct invalid data upon your authorized direction. We hope you find The Berwyn Group's reporting and service helpful. As always, we welcome any feedback you wish to share. Please feel free to contact me at 617 - 985 -1903 or via email at bjdooley @statestreet.com should you have any comments, questions or concerns regarding this report. Sincerely, M7 ,,, Barbara J. Dooley Enclosure(s) • PERSONAL SENSITIVE DATA i DeathCheck Mortality Identification Services The Berwyn Group Web: berwyngroup.com BOYNTON Personal Sensitive Data 11/02/2015 The following analysis has verified 111 records from your data and matched 0 individuals against The Berwyn Group's National Master Death file. Positive matches generally indicate that individuals being verified are deceased. However, some positive matches are "false- positives ". Source files can and do have data errors, and acquisition of individual death certificates is required for reliable verifications. The Berwyn Group makes no guarantees or warrantees that the source files contain the entire universe of deceased individuals. Many deaths remain unreported. Consequently, the absence of a match is not an unequivocal indicator of validations. The Berwyn Group is dedicated to maintaining the most credible and up -to -date data sources for our analytic and research work. Our commitment to this goal ensures that our customers receive the highest quality work product and the highest degree of customer satisfaction. The Berwyn Group has audited this file against the latest avaialble updated version of the full Social Security Master File as of the date of this audit. This audit also includes Berwyn Group's other death file sources which are updated. as they are made available to the Berwyn Group. This audit is performed using the social security number on the file if provided, or by first name, last name and date of birth if the social security number is missing. In order for a match to be reported by first name, last name and date of birth all 3 data elements must match exactly to those data elements in Berwyn Group's Master Death File. .tpanatei 1 of 7k W ENNSA f e e tiL MEMORANDUM TO: ALL 175 -185 PLANS FROM: KLAUSNER KAUFMAN JENSEN & LEVINSON RE: INSURANCE PREMIUM TAX (IPT) DATABASE REMINDER DATE: DECEMBER 5, 20015 Following the adoption of SB 172 and the renewed focus on premium taxes, it is useful to update clients on the ways of maximizing your receipt'of revenue, whether the premium taxes are used to offset City contributions or are being paid into a share plan. In other words, the purpose of this memorandum is to provide a friendly reminder about low hanging fruit, the collection of which is mutually beneficial for the retirement system and the city /plan sponsor. This memo will describe what can be done to improve the collection of Insurance Premium Tax (IPT) revenue, which is dedicated for Chapter 175 and Chapter 185 pension plans, and communications services tax (CST) revenue which is payable to cities. Our informal sampling of cities in the IPT /CST database suggests that many cities have not updated the database for several years. In particular, we have determined that IPT database shortcomings often arise in the following three instances: 1) municipal annexations, 2) new construction on previously undeveloped land, and 3) areas under which police or fire services are being contractually provided by inter -local agreement. In sum, it is not safe to assume that the database is automatically registering your recent annexations, new construction or inter -local service boundaries. This is particularly true if there has been turnover in your city in the positions responsible for working with the Department of Revenue, as the IPT database contact person. 00064947.WPD;1 7080 NORTHWEST 4TH STREET, PLANTATION, FLORIDA 33317 PHONE: (954) 916 -1202 FAX: (954) 916 -1232 www.robertdklausner. com What can you do? 1) Provide a copy of this memo to your city's assigned IPT database contact person. A copy of the Department of Revenue's contact list is attached, which should contain the name, telephone number and email address for your city's assigned IPT contact person. 2) Pay attention to any annexations during the past several years. Our office is happy to help verify that the new properties have been properly added into the database; 3) Periodically use the https: / /pointmatch.state.fl.us website to independently verify that city addresses are included in the database. A copy of the online "tax and address lookup" tool is attached. 4) Explain to your city that the proper registration of correct municipal boundaries, addresses and police /fire codes is in the mutual interest of your pension plan and the city. Because the identical database is used to allocate CST taxes to cities, as well as IPT taxes to the pension plans, it is in the collective interest of both the plans and plan sponsors that the database is being correctly updated and periodically monitored. If the attached list doesn't provide a contact for your city, it is important to make sure that a contact person is assigned and trained to work with the database; Our office is available to answer any questions on this subject. • 00064947.WPD1 • 1213/2015 Address Search Address Lookup - Welcome to Florida's Tax and Address Lookup System. • Use the search opUons bebw to find tax rates for any address in Ronda. You can search by single address, full street, jurisdiction, county or special Ike district. Sorting options allow for customizing of search results. For more Information or help with searching, Abase refer to our User Guide. Address Lookup Tips or contact us. Search results may contain pending changes that will become effective In a future update. — Address- infbnnetiun LEI Hausa Number Pre.DIr (N,S) Street Name (do not include sheet type). Street Type (AVE, BLVD, S7) Post.Ir (N,S) IPII Hint Try ......... - -- — removing • • .. the City _ _. - - -- ... — Name or • MP Code City Name cup de from your Code search • Vour results will __ .._.......... ._._...._....._._... _._.. ._...._._....._......_. be broadened. • • Jurisdiction information County Name Jurisdiction Name Special Fire District Name • 1 Search Clear j • • , htlpsJlpointrnatch state.fl.us/Default.aspx 1/1 • Jurisdiction First Name Last Name. Phone Email ARCHER John _ Mayberry 352- 495 -2880 x102 jmayberry@cityofarcher.com ATLANTIC BEACH Jeremy Hubsch 904 - 247 -5817 jhubsch @coab.us ATLANTIS Mo Thornton 561 - 965 -1744 mthornton @atlantisfl.gov AUBURNDALE Shirley Lowrance 863 - 968 -5133 slowrance @aubumdalefl.com AVENTURA Brian Raducci 305 - 466 -8920 braducci @cityofaventura.com AVON PARK Allison Jacobs 863- 452 -4409 ajacobs @avonpark.cc BAL HARBOUR Christopher Wallace 305 - 866 -4633 x329 cwallace @balharbour.org BALDWIN Lula Hill 904 - 266 -5031 (hill @baldwinfl.com BARTOW _ Andrea Henley -Pratt 863- 534 -6816 apratt.finance @cityofbartow.net BARTOW DAVID WRIGHT 863 - 534 - 0100x1349 dwright.finance @cityofbartow.net BASCOM Chrystal Bryan 850 -569 -2007 Townofbascom @centurylink.net BAY HARBOR ISLANDS Alan Short 305 - 866 -6241 ashort@bayharborislands.net BELL Dan Cavanah 352 - 463 -6288 townmanager @townofbellflorida.com BELLEAIR BLUFFS DEBRA SULLIVAN 727 -584 -2151 DSULLIVAN @BELLEAIRBLUFFS- FL.GOV BELLEAIR SHORE Bonnie Dhonau 727 -593 -9296 bonnie @myindianshores.com BELLEAIR SHORE John Robertson 727 - 593 -9296 jroberts @tampabay.rr.com BELLEVIEW Richard Webb 352 - 671 -8460 richard.webb@marioncountyfl.org BEVERLY BEACH DONNA FRANCIS 386 - 439 -6888 obeverlybeacht @cfl.rr.com BLOUNTSTOWN Traci Hall 850 - 674 -5488 thall @blountstown.org . BOCA RATON Patricia White 561 - 393 -7e53 pwhite @ci.boca - raton.fl.us BONIFAY Jeri Gibson 850 -547 -4238 cityofbonifay.jeri @embarqmail.com BONITA SPRINGS Matt Feeney 239 - 949 -6246 matt.feeney @cityofbonitasprings.org BONITA SPRINGS Brenda Reetz 239 - 949 -6271 brenda.reetz @ci ofbonitasprings.org / BOYNTON BEACH John McNally 561- 742 -6073 mcnallyj @bbfl.us BOYNTON BEACH Terri Owens 561 - 742 -6077 owenst @bbfl.us BRADENTON Sharon Beauchamp 941 - 932 -9442 sharon.beauchamp@cityofbradenton.com BRADENTON Tatiana Gonzalez 941 - 932 -9403 tatiana .gonzalez @cityofbradenton.com BRADENTON BEACH Shannon Ansbro 941 -748 -4501 x3415 shannon.ansbro @mymanatee.org BRANFORD Donna Hardin , 386 - 935 -1146 townofbranford @windstream.net BRINY BREEZES Carol Lang 561- 272 -5495 brinytownclerk @yahoo.com BRISTOL Robin Hatcher 850- 643 -2261 rmh.cityofbristol @fairpoint.net . BROOKSVILLE JESSICA HAYDEN 352 - 754-4190 x25015 jhayden @hernandocounty.us BROOKSVILLE Darlene Marshall 352 - 754 -4190 x25161 dmarshall @hernandocounty.us . 1 Barbara Ladue From: Barbara Ladue <Iadueb @bbpdpension.com> Sent: Wednesday, December 16, 2015 8:21 AM To: — Hallisey, Anne (St Street) (amhallisey @statestreet.com); Dube, James (J Du be @ StateStreet. co m) Cc: 'Athol, Toby' Subject: Plus Web - January 1, 2016 Benefit Payments On November 30 I participated in a three hour Web conference regarding Pius Web. It is now down to the "wire" and I ,have no access to this new program in which I need to process the January 1 benefit payments. I have a new retiree to add and several modifications to existing participants. I also have a Lump Sum DROP W/D to process. Please let me know what I need to do to get this up and running today. Thank you. Barb La Due Pension Administrator Boynton Beach Police & Fire Pension Funds Phone: (561) 739.7972 � de 444% Poiptaa. , ? tplog- I 44 , v ., 0 7 ,/ Sfa ' PO:14Z C: a a 41/19 a P44 . , - ( 9i," • 04 1 /14‘ 4 4415, c,„„ti-- del I . e• I /& 4... 7 r 1 4.. Arid 104 t A 1 7 1 p Iva roe era . ;.,,fir • 1 ussell investments — Data Entry II — User Access Form D Please complete when Adding, Modifying or Deleting User Access for Plus Web, iPayBenefits and /or Custom Queries > The Retiree Services Manager must complete the top (Retiree Services Use Only section) prior to providing this form to the client or record keeper for processing 1 / - f Sections 1, 2 and 3 must be completed by the client or Record Keeper • Please review for accuracy and be certain all fields are populated before submitting this request. Any section not completed will result in the form being rejected. > Please submit completed forms (in a Word Document not PDF) to: RSipavbenefitsFormsCa ),StateStreet.com Retiree Services Use Only Branding: Russell Investments Client ID: :::B:OYNTONB _;Pension.: Corporate. System :Corp 5 LS. Corporate. System: Corp: 3 ;, Section 1— Reason For Request: ® ADD ❑ MODIFY: Select.... ❑ DELETE: Select.... If user access exists (and this request is for a modification or deletion), please provide the existing User ID(s) to be modified or deleted: Special Instructions: Live Date 11.30.2015 Section 2 — Client or Record Keeper Company Information: Client or Record Keeper Company: Record Keeper Company Name: Boynton Beach Police Officers' Pension Fund Company Address: 1500 Gateway Blvd. Ste 220 City: Boynton Beach State: FL Zip: 33426 Country: USA • Primary Contact Name: Barbara LaDue Title: Pension Administrator E -mail: ladueb acbbpdpension.com Phone: 561 - 739 - 7972 Ext: iPayBenefits Company Applications: ® PLUS Web ® iPayBenefits Workspace ® Custom Queries ® Funding Report PLUS WEB: Retiree Benefits Management; Application iPayBenefits Workspace: Secure location for storing shared documents Custom Queries & Funding: Tool for creating customized reports. Discuss with your Retiree Services contact for details. Section 3 - User Profile Information: First Name: Barbara Last Name: LaDue E -mail: ladueb aebbpdpension.com Phone: 561 - 739 - 7972 Ext: Company Address (if different than above): City: State: Zip: Country: User Role: Associate User Group (functionality listed on pages 2 - 3): 10 PenNIC,NCR,SPNIC NCR,LSNIC,NCR All Rpt All BPA User Association(s): (If access is for a Manager; list at least one Associate, if access is for an Associate; list at least one Manager) Associate 1 Barbara LaDue Select.... 2 Select.... 3 Users have access to all accounts unless otherwise specified below: Account IDs — Pension Recurring Account IDs - Lump Sum ® All Pension Account IDs ® All Lump Sum Account IDs ❑ - - - • - - ❑ - - Authorization: I authorize the requested access for the person named above as valid and necessary. I understand it is my responsibility to complete an iPayBenefits User Access Form and submit it to State Street Retiree Services when access requires a chan ?e or is no longer required for this user. Authorized by: Toby Athol Date: 12 -02 -2015 • Information Classification: Personal Sensitive Data Ra%I 1.; (1R/1 F/1 musseii investments -- Data Entry li — User Access Forum 1/ c'- ' ' ➢ Please complete when Adding, Modifying or Deleting User Access for Plus Web, iPayBenefits and /or Custom Queries ➢ The Retiree Services Manager must complete the top (Retiree Services Use Only section) prior to providing this form to the client or record keeper for processing ➢ Sections 1, 2 and 3 must be completed by the client or Record Keeper ➢ Please review for accuracy and be certain all fields are populated before submitting this request. Any section not completed will result in the form being rejected. ➢ Please submit completed forms (in a Word Document not PDF) to: RSipavbenefitsForms @StateStreet.com Retiree Services Use Oniy Branding: Russell Investments Client ID: B.OYNTONB Pension Corporate System: Corp 5 LS Corporate System: Corp 3 Section 1 — Reason For Request: ® ADD ❑ MODIFY: Select.... ❑ DELETE: Select.... If user access exists (and this request is for a modification or deletion), please provide the existing User ID(s) to be modified or deleted: Special Instructions: Live Date 11.301015 Section 2 — Client or Record Keeper Company information: Client or Record Keeper Company: Record Keeper Company Name: Boynton Police Officers' Pension Fund Company Address: 1500 Gateway Blvd. Ste 220 City: Boynton Beach State: FL Zip: 33426 Country: USA Primary Contact Name: Barbara LaDue Title: Pension Administrator E -mail: ladueb aebbpdpension.com . Phone: 561 - 739 - 7972 Ext: iPayBenefits Company Applications: • ® PLUS Web ® iPayBenefits Workspace ® Custom Queries ® Funding Report PLUS WEB: Retiree Benefits Management Application iPayBenefits Workspace: Secure location for storing shared documents Custom Queries & Funding: Tool for creating customized reports. Discuss with your Retiree Services contact for details. Section 3 - User Profile Information: First Name: Barbara Last Name: LaDue E -mail: ladueb a1 bbpdpension.com Phone: 561 - 739 - 7972 Ext: Company Address if different than above): City: State: Zip: Country: User Role: Manager User Group (functionality listed on pages 2 -3): 10 PenNIC NCR,LSNIC,NCR All Rpt All BPA User Association(s): (If access is for a Manager; list at least one Associate, if access is for an Associate; list at least one Manager) 9 ) Select.... 1 Select.... 2 Select.... 3 Users have access to all accounts unless otherwise specified below: Account IDs — Pension Recurring Account IDs - Lump Sum ® All Pension Account IDs ® All Lump Sum Account IDs ❑ - - ❑ - - ❑ - - ❑ - - Authorization: I authorize the requested access for the person named above as valid and necessary. .I understand it is my responsibility to complete an iPayBenefits User Access Form and submit it to State Street Retiree Services when access requires a change or is no longer required for this user, Authorized by: Toby Athol Date: 11 -25 -2015 Information Classification: Personal Sensitive Data • Barbara Ladue From: Barbara Ladue <Iadueb @bbpdpension.com> Sent: Wednesday, November 25, 2015 11:10 AM To: 'Athol, Toby' Subject: Russell /State Street Plus Web Program Attachments: DOC112515.pdf Toby: These are the forms that State Street is looking to receive. I do not understand all this "top secret stuff". I advised them that you would probably not respond until next week, since this is the Thanksgiving holiday. I started this process back on 11 -18 -15 and they did not respond until yesterday. You probably figure out this secure stuff. Barb Barb La Due 1-,; ij ° f ilt\4 Pension Administrator Boynton Beach Police & Fire Pension Funds Phone: (561) 739.7972 -----Original Message From: Scanner fmailto :faxexecsuites @gmail.coml Sent: Wednesday, November 25, 2015 11:55 AM To: BARBARA LADUE Subject: Send data from MFP07580425 11/25/2015 11:55 Scanned from MFP07580425 Date:11/25/2015 11:55 Pages:2 Resolution:200x200 DPI 1 L Russell Investments Invoice Invoice for: Invoice Number Russell Client ID Billing Period Ending City of Boynton Beach Police Retirement 52047 C04616001 12/31/2015 Fund 1500 Gateway Blvd #220 Invoice Date Payment Terms Total Amount Due Boynton Beach, FL 33426 01/15/2016 Net 30 Days $ 136,121.00 Mail to: City of Boynton Beach Police Retirement Specify Remittance. Information: Fund 1500 Gateway Blvd #220 1 Payment by check Boynton Beach, FL 33426 Make check payable to: :. . Russell Investments '... . Check Amount I��II��JIi�I��LJ�I�II��rJJI 0 Request payment by Direct Debit Authorized Signer See additional instructions on reverse side Please retum upper portion with your check or direct debit request The following is a summary of your account(s). For more information, please review the enclosed detail. Direct Debit per Description of Service Fee Amount Standing Instructions or Amount Due Payments Received Russell Investments Investment Management Fees $ 136,121.00 $ 0.00 $ 136,121.00 Current Period Fees $ 136,121.00 $ 0.00 $ 136,121.00 Balance Forward 131,372.00 (131,372.00) 0.00 Total Amount Due $ 136,121.00 Invoice Number Invoice Date Russell Client ID Payment Terms Billing Period Ending 52047 01/15/2016 C04616001 Net 30 Days 12/31/2015 Current Period Over 30 Days Over 60 Days Over 90 Days Total Amount Due $ 136,121.00 $ 0.00 $ 0.00 $ 0.00 $ 136,121.00 Invoice for: City of Boynton Beach Police Retirement Fund 1500 Gateway Blvd #220 Boynton Beach, FL 33426 (See reverse side for additional information) I ' Invoice Invoice Number: 52047 Billing Period Ending: 12/31/2015 Russell Investments; FEE DETAIL Investment Management Fees City of Boynton Beach Police Retirement Fund Boynton Beach Police Officers Retirement Trust Funds Investment Account Account Number. QU7W Fund Name Average Rate% Fee Amount Market Value Russell Multi -Asset Core Fund 31,905,280 0.23000 73,382.00 Russell Large Cap Defensive 21,451,678 0.16500 35,395.00 Equity Fund Russell Multi- Manager Bond Fund 22,874,385 0.12250 28,021.00 Russell Real Estate Equity Fund 6,259,830 0.36250 22,692.00 Russell Short-Term Investment Fund 190,928 0.05500 105.00 Subtotal 82,682,101 $ 159,595.00 Russell Real Estate Equity Fund - Internal Fee Paid (23,474.00) Account Total $ 136,121.00 Total Investment Management Fees $ 136,121.00 Page 2 6Z /T0 /9TOZ 3snsy 4119149aT1e21 saoT ; ;O eOTTod -Nxs6 L666- 90LiLOZTST #'ANI 8T'T60'T ESE SaDtVH0 LNa2Ri=O • £b'ZLZ ** xaxOOd ao yno i oygns ** 8L'8T 9Z'9 STOZ /O£ /TT se5s2R0 Sdn 9Z'9 STOZ /6Z /OT sabs2R0 Sdn 9Z'9 STOZ /8Z/6 s Sdn xllanri a san iT' a3FApd o/M skid ea ;ay 8Z'Z ins dmng 68' 9 quamked qT ;aueg 6E'EVZ aTsodaa ;o aoinpV aDVXSOd SaDliVHO J )IOOd 30 yno SL' 8T8 ** Saa3 'I'VJOXEfS ** 00'SZZ 00'SZ yK 6 suTIT6 X 9 4 2 3s mad ES= :MMENxyd .I3aNag OO' Ot 00'0T XV sauamAEd mns dUn'i 00'ST SZ'T MV ZT s3uatud2d 4T ;auag BUSES SZ'T XV 'CET 9 Tem{2d 1T ;auas soy Saa3 XJaHD IN3WXV6 =dame SEDUM yNaNx�id UnOx HSIM N2inna2l tioixmaod SIHL HOVL C aSVE'Id anp2Z 'Z 2zngseg NoxtNEXXV 9Zb£E Z3 'Bones uo;udos £ edxy Av./ so;2slsfupaPV uorsued a0I'IOd NonNxOa :aI 3uno00FZOZZ# e4InS'pAis Aw.a 42D OOST 'sPu3 uoTsued a1T6 8 aoTTod uoqudog ea Roses uoauxos ;o d ;FO ST /TE /ZT oa 5T /TO /OT a0Ixad HIMON E 2IOd gamy quaivasF ;eg saoT ; ;O aoTTod 3snsy ;ustmaTleX 283 ; ;0 90TInd -Nxa6 8T'T60'T aSn aollled LNa2RI0Z SeD2WH0 'WLOa T 30 T sDBa Li89 NN 'sTTodeauuTH 6Z /T0/9TOZ awa L$89S8 XO5 Od L666- 900 'ON a0IOANI - - SZSi+ EEDvNVAI s;ua sanul 'creams. Klausner, Kaufman, Jensen & Levinson A Partnership of Professional Associations Attorneys At Law 7080 N.W. 4th Street Plantation, Florida 33317 Tel. (954) 916 -1202 www.robertdklausner.com Fax (954) 916 -1232 Tax I.D.: 45- 4083636 BOYNTON BEACH POLICE OFFICERS' PENSION FUND December 31, 2015 Attn: CHAIRMAN Bill # 17630 1500 GATEWAY BLVD., SUITE 220 BOYNTON BEACH, FL 33426 For Legal Services Rendered Through 12/31/15. - CLIENT: BOYNTON BEACH POLICE OFFICERS' PENSION FUND. : BBPOLBSJ MATTER: BOYNTON BEACH POLICE OFFICERS' PENSION FUND :150046 Professional Fees Date Attorney Description Hours Amount 12/07/15 BSJ DRAFT JOINT RFP FOR 1.20 270.00 ADMINISTRATOR 12/08/15 BSJ REVIEW MINUTES OF NOVEMBER 10, 0.30 67.50 2015 MEETING 12/08/15 BSJ TELEPHONE CALL WITH TOBYATHOL 0.50 112.50 REGARDING RFP FOR ADMINISTRATOR AND DISABILITY APPLICATION; RESEARCH DISABILITY APPLICATION 12/08/15 BSJ REVIEW AND REVISE RFP FOR 1.50 337.50 ADMINISTRATOR 12/09/15 BSJ REVIEW AND REVISE RFP; REVIEW 1.50 337.50 ACTUARIAL VALUATION FOR DEMOGRAPHICS; EMAIL TO ADAM LEVINSON 12/15/15 BSJ REVIEW AND REVISE RFP FOR 0.20 45.00 ADMINSITRATOR PER EMAILS 12/15/15 BSJ DRAFT RESPONSE TO AUDIT INQUIRY 1.00 225.00 LETTER 12/18/15 BSJ REVIEW AND REVISE RESPONSE TO 0.50 112.50 AUDIT INQUIRY LETTER 12/23/15 BSJ PREPARE LIST OF POTENTIAL 0.50 112.50 ADMINISTRATORS FOR RFP MAILING LIST Total for Services 7.20 $1,620.00 Continued .. . Af Client: BOYNTON BEACH POLICE OFFICERS' PENSION FUND December 31, 2015 Matter: 150046 - BOYNTON BEACH POLICE OFFICERS' PENSION Page 2 CURRENT BILL TOTAL AMOUNT DUE $ 1,620.00 Past Due Balance 967.50 AMOUNT DUE y //2,587.50 cc_ Klausner, Kaufman, Jensen & Levinson A Partnership of Professional Associations Attorneys At Law 7080 N.W. 4th Street Plantation, Florida 33317 Tel. (954) 916 -1202 www.robertdklausner.com Fax (954) 916 -1232 Tax I.D.: 45- 4083636 BOYNTON BEACH POLICE OFFICERS' PENSION FUND November 30, 2015 Attn: CHAIRMAN Bill # 17502 1500 GATEWAY BLVD., SUITE 220 BOYNTON BEACH, FL 33426 For Legal Services Rendered Through 11/30/15 CLIENT: BOYNTON BEACH POLICE OFFICERS' PENSION FUND : BBPOLBSJ MATTER: BOYNTON BEACH POLICE OFFICERS' PENSION FUND :150046 Professional Fees Date Attorney Description Hours Amount 11/01/15 BSJ REVIEW MINUTES OF AUGUST 11, 2015 0.50 112.50 MEETING 11/03/15 BSJ RESEARCH EIN; COMPLETE IRS 0.70 157.50 FORMS 8717 AND 2848 11/04/15 BSJ DISCUSSION WITH FIRE BOARD 0.50 112.50 ATTORNEY REGARDING ADMINISTRATOR RFP 11/06/15 BSJ PREPARE FOR MEETING; EMAIL 0.50 112.50 BARBARA LADUE REGARDING FIREFIGHTER RFP 11/09/15 BSJ REVIEW AGENDAAND BACKUP FOR 0.30 67.50 THE MEETING 11/10/15 11/10/15 BSJ ATTEND MEETING 1.50 337.50 11/18/15 BSJ TELEPHONE CALL WITH TOBYATHOL 0.30 67.50 REGARDING MISCELLANEOUS UPCOMING MATTERS Total for Services 4.30 $967.50 CURRENT BILL TOTAL AMOUNT DUE $ 967.50 • BURGESS CHAMBERS & ASSOCIATES, INC. Invoice INVESTMENT ADVISORS S.E.C. REGISTERED 315 E. Robinson Street, Suite 690 Date Invoice # Orlando, Florida 32801 12/2/2015 15 -351 Bill To Boynton Beach Police Officers' Pension • Barbara La Due, Administrator 1500 Gateway Blvd, Suite 220 Boynton Beach, Florida 33426 Description Amount Fourth Quarter 2015 Investment and Performance Monitoring and Advisory Fee per Contract 6,250.00 Total $6,250.00 Phone # Fax # (407) 644 -0111 (407) 644 -0694 19-ND c Gabriel, Roeder, Smith & Company Consultants & Actuaries One East Broward Blvd. Suite 505 Invoice Ft. Lauderdale, Florida 33301 -1804 (954) 527 -1616 - Date Invoice ` 1/6/2016 419006 Bill To: Please Remit To: - Attention: Ms. Barbara La Due Dept. # 78009 Pension Administrator Gabriel, Roeder, Smith & Company Municipal Police Officers' Retirement Fund PO Box 78000 City of- Boynton Beach • Detroit, Michigan 48278 -0009 Renaissance Executive. Suites 1500 Gateway Blvd. , Suite 220 Boynton Beach, Florida 33426 Federal Tai ID - - _-Client 10f155d For professional actuarial services rendered for the Boynton Beach ' Municipal Police Officers` Retirement Fund through 12/31/2015 Calculation of present value of remaining biweekly payroll payments for two different 300.00 service purchase calculations for Douglas Gilbert Service Purchase Calculations for: DeLosRios and Kautz 2.00 450.00 900.00 Charges to date for preparation of the 10/1/2015 Actuarial Valuation Report; total 742.00 charges to date equal $742 Amount Due $1,942 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, F134698 Phone # 727 - 734 -5437 1/4/2016 R7473 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, 2015 Progress billing 6,000.00 Total $6,000.00 Payments /Credits $0.00 Balance Due $6,000.00 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 ;6 at?, Tep 1 44sR71 4 ,k MEMOIIANDUM TO: Board of Trustees FROM: Bonni S. Jensen g Fund Legal Counsel I , DATE: January 2016 SUBJECT: IRS Mileage Rate for 2016 This is to inform you that the Internal Revenue Service ( "IRS ") released its updated Standard Mileage Rate. for 2016. The new rate is 54 cents per mile for miles driven after January 1, 2016. This is down from last yepr's 57.5 cents. As you know from previous years, th mileage rate can fluctuate within the same year. We will do our best to keep you and the administrator informed. You can find the current rate at the link below. www.irs.gov /uac /Newsroom /2016- Standard -Mi leage- Rates - for - Business -Med ical- and- Moving- Announced If you have any questions, please dd not hesitate to contact us. BSJ /pah Enclosure E -Copy: Administrator 00065961.WPD;1 7080 NORTHWEST 4TI'I STRE0T, PLANTATION, FLORIDA 33317 PHONE: (954) 916 -1202 4 FAX: (954) 916 -1232 www.robertldklausner.com CITY OF BOYNTON BEACH POLICE OFFICERS' PENSION SYSTEM POLICE OFFICERS' PENSION DATA PAGE 1 REPORTING PERIOD 10/01/2015 TO 02/01/2016 Social Names Date of Date of Benef. Total Security Birth Retire/ Disability Birth Pens. Monthly Received Number Last, First, I. Disab. Code Name of Beneficiary Date Opt. Pension This Yr RETIREMENT 5179 ANDERSON,BRIAN 3 -A 6,546.06 35,495.8: CITY OF BOYNTON BEACH POLICE OFFICERS' PENSION SYSTEM POLICE OFFICERS' PENSION DATA PAGE 2 REPORTING PERIOD 10/01/2015 TO 02/01/2016 Social Names Date of Date of Benef. Total Security Birth Retire/ Disability Birth Pens. Monthly Received Number Last, First, I. Disab. Code Name of Beneficiary Date Opt. Pension This Yr 1172 HAMILTON,WILLIAM 1 1,271.97 8,439.0 CITY OF BOYNTON BEACH POLICE OFFICERS' PENSION SYSTEM POLICE OFFICERS' PENSION DATA PAGE 3 REPORTING PERIOD 10/01/2015 TO 02/01/2016 Social Names Date of Date of Benef. Total Security Birth Retire/ Disability Birth Pens. Monthly Received Number Last, First, I. Disab. Code Name of Beneficiary Date Opt. Pension This Yr 3698 OSTASZEWSKI,HENRY 2 3,624.05 21,493.6. • CITY OF BOYNTON BEACH POLICE OFFICERS' PENSION SYSTEM POLICE OFFICERS' PENSION DATA PAGE 4 REPORTING PERIOD 10/01/2015 TO 02/01/2016 Social Names Date of Date of Benef. Total Security Birth Retire/ Disability Birth Pens. Monthly Received Number Last, First, I. Disab. Code Name of Beneficiary Date Opt. Pension This Yr 0524 WIER,DAVID 1,467.23 10,637.5 Disability 176,271.43 BENEFICIARY 1815 PARKER - POOLE,LINDA 04/1948 3 -B 783.10 6,286.8' 2665 JACOBSON,CINDY 04/1964 3 -A 1,986.93 13,457.3 Death 19,744.21 NUMBER OF RETIRED EMPLOYEES ON THIS REPORT: 122 TOTAL PENSION PAYMENTS 2,329,720.50 4 e