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LTC 277-2008 Wall Street Impact on City Pensions
m MIAMIBEACH OFFICE Or THE CITY MANAGER NO LTC#277-2008 LETTER TO COMMISSIQRJ, _, o m --; b ~-~ TC Mayor Matti Bower and Members of the City Commission - - :-,-' N i _ FROrn Jorge M. Gonzalez, City Manager r ~ ~ _ ' -o ~ -r1 DATE: November 12, 2008 ~ r J -- w SUBJEC' Wall Street Impact on City Pensions' w This Letter to Commission (LTC) is in response to Commissioner Tobin's questions regarding the type of impact the current financial crisis on Wall Street could have on city pension. Below are the questions received from the Commissioner along with the respective answers to each. The answers were reviewed for accuracy with the Pension Administrators for each of the City's Pension Funds. Attachments to this LTC will be hand-delivered. 1. At what point does the city have to use taxpayer or other monies to make up pension shortfalls? Each year, the City receives actuarial reports for each of the City's two pension plans (Firefighters and Police Officers, and General Employees). These reports specify the City's contribution requirement for the upcoming fiscal year. The required contribution is determined in accordance with State Statues and is based on various assumptions: including wage data, mortality rates. retirement ages. future salary increases, marriage assumptions, plan expenses, etc. as well as investment performance assumptions. The actuarial valuation of the pension plan is a mathematical determination of the financial condition of a plan which includes the computation of the present monetary value of benefits payable to present members, and the present monetary value of future employer and employee contributions, considering the expected mortality rates among employees and retirees. rates of disability, retirement, withdrawal from service, salary and interest. As part of the October 1 valuation each year, the actuary evaluates how the actual data for the preceding year as compared to the actuarial valuation for that year. Any differences are reflected as gains or losses in unfunded liability. Any gains or losses in unfunded liability are amortized over 30 years. Thus, any gains or losses in unfunded liability for FY 2007/08 Plan Year (as of October 1, 2008 and as compared to plan assumptions) will be taken into account as part of the City's required actuarial contribution for FY 2009110. Gains or losses in unfunded liability for FY 2008/09 Plan Year (as of October 1, 2009 and as compared to plan assumptions) will be taken into account as part of the City's required actuarial contribution for FY 2010/11 Copies of the last set of actuarial reports will be forwarded separately for your information. Wall Street Impact on City Pensions Page 2 2. Is there a possibility that the city might have to contribute money this year in order for each pension recipient to receive what they are owed? The City's required contribution for FY 2008109 for the Pension Fund for Fire and Police Officers was provided to the City in March 2008 and is based on the actuarial valuation of the Fund. The required contribution for General Employees was provided to the City in July 2008. Both are based an October 1, 2007 actuarial valuation. These required contributions were incorporated in the FY 2008/09 budget and have been transferred from the City to each of the two pension plans. No additional contributions are required for FY 2008109. 3. Do you see pension obligations causing a financial crisis in the city of Miami Beach? Why or why not? As presented at several meetings with the Mayor and Commissioners (annual retreats, Finance and Citywide Committee meetings, etc.), the growth in the City's contribution for pension is indeed a concern. Annually, I have identified that the contribution reflects a growing percent of payroll, particularly for the Fire and Police Pensions. Firefi hters & Police Officers° with Pension General Pension Plan Bonds Em to ees FY 2003104 27.27% 42,40% 8.71% 7.97% FY2004/O5 36.03% 51,20% 18.71% 13.41% FY 2005/06 42.75% 57,51% 17.28% 15.35% FY 2006!07 46,71 % 62.15% 24.65% FY 2007108 47.82% 61.47% 24.24% FY 2008/09 50.02% 62.49% 21.57% `In addition to the Annual Required Contribution determined by the Actuarial Valuation of each pension plan, the City funds approximately $5 million per year in debt service for Fire and Police Pension Bonds. " Prior to FY 2007/08 the Unclassified and General employees had two separate pension plans. In FY 2007/08 these were combined into one plan. For this reason, the Commission has directed us to examine methods to reduce this growth: the City's classification and compensation study currently underway is charged with identifying methods to contain growth in salary and benefit costs; and we are looking at other alternatives, such as the Florida Retirement System. Wall Street Impact on City Pensions Page 3 4. What type of preventive measure has the city taken to protect pensions during these tough financial times? Each of the City's two pension plans are managed by a Board of Trustees that are responsible for the proper administration of each of the two pension systems to ensure providing benefits to participants and beneficiaries and defraying reasonable expenses of plan administration. The trustees are comprised of a combination of elected and appointed positions. Investment of funds is guided by an Investment Policy (as required by State law). Further, the investment policies for both plans require the use of professional investment manager(s) who are responsible to carryout the investment guidelines and policies. The policies include performance measurement, authorized investments, portfolio composition, and expected rate of return over the long term, etc. The performance of the plans is reviewed no less than quarterly with independent evaluators/consultants to determine if the investment guidelines have been met. The investment objective of each plan is a long-term rate of return on assets. Investments are diversified to reduce loss resulting from over concentration on a specific maturity. issuer. instrument. etc. Copies of the investment policies for each plan will be forwarded separately 5. Approximately how much value have the city's pension investments lost as a result of the current financial crisis? The market value of the assets of each fund is determined annually on October 1 and reflects the value if all the assets of the plan were liquidated on that day. The market value of both plans over the last several years has been as follows: Firefighters & General Police Officers Employees October 1, 2005 $483,180,441 $346,845,203 October 1, 2006 $511,508,585 $378,035,985 October 1 , 2007 $571;193,561 $429,720,685 October 1 , 2008* $499.779,000 $311,877.655 * The October 1, 2008 values are estimated/unaudited and include FY 2007108 Contributions: City $17,497,496 $13;911,545 Employees $ 5,577,298 $ 7,927,173 In contrast to the market value of the plan, the actuarial value of the pension plan assets is equal to the market value of the assets adjusted to reflect a five year phase-in (or smoothing) of any asset experience gain or loss. Only 20% of the experience gain or loss that the fund experiences in any one year is recognized immediately for the purpose of determining the actuarial value of the plan and the annual required contribution. Wall Street Impact on City Pensions Page 4 For example FY 2006/07 the Market Value Return on investments for the City Pension Fund for Fire and Police Officers was 14.31 %, but the actuarial valuation of the plan calculated an Actuarial Value Return of only 8.18%, thus providing a buffer for future downturns in the market. The historical actuarial values of the plans are as follows: Firefighters & General Police Officers Employees October 1, 2005 $457.680,582 $325,727.087 October 1, 2006 $470,603,144 $358,458.949 October 1, 2007 $495,993,903 $412,824.235 6. Do you see pension obligations causing a financial crisis in the city of Miami Beach? Why or why not? See question 3 above. Please feel free to contact me should you need any additional information or have any questions. JMG/KGB/ias .' 4.. R ..., ~ , kflsClCtz~a't~illi~ai'tt5 :?` Page i~umher .{' i Table I Surnmarv of'ValJation.Results .............,.,.,.... . Table II Gain and Loss ..9nalysis .......:..........:.:..::. Tab?e III Accocnriu~ T~isclosures tGASB<S,'27}....,..> .:..:.....:.:............ ....... Table TV Preseat Vaiuc of r\ccrued I3ereEts ................. . 'Table V Ir-fi~*marion Raq. by Florida Statute Chapter 112 ... ............. .....:......... .Table Va lirtimded Liability Bases ................. . .. .. . . .................:............... ..:..... . rLsscis 'Table VI Table VIa Table VII Table VIIa Table VIII Data Table 1X Table IXa Table IXb 'f'able IXc Table IXd Tab?e 1Xe Table TXf Table. ~Y Assam ri°ns Taire XI Table XIa flan Provisions Ta:~IeXTI PianProvisiocs ............... ._ ............::................................................... 33 Tab?e :1'IIa ?last Amendmert3:........... 37 City Pension Fund for Firefrghters and Police Officers in tha Cibl of Miami Beach Page i Actuar.-al Asssmpt:ons aul ;vSethods ............................................ Assumption Changes .............. ............:........ . ........................ b~~kc~~~~~.~i~~~~~~ ~~ :~:f<; ~ 5 Vfaroh 18, 2008 1?e;tr Members of the Board "this report presents the tx:sulLs of lice October 1, 2007 actuarial weiuatian of the City Pension Fund fur Fire€sgha~rs and Foficc t)fficcrs in the City of hTiami Beach: 'I~his valuation will bused to determine Fhe contributions for Else City's fiscal year beginning October 1, 2t)D$. "I7te City cumribtrtion reyuirensent for tha kcal year beginning Ck;to6er 1, 2008 is summariacci below, payable at October 1, 2008. ~equired (:ity contributton for plan vent beginning 10/1/2008 S2();039•A46 l - --,...- _ _..._. -- - ---------- --- - ---- _ 1 "lhc City`s contribution increased from St7,497,49b for the 2007;2008 Final year w 520,039,445 fer the: 2008!2f109 fist:a] year. 't'he increase is the contribution rectuiretnent is due primarily w the highet• than expected pay incrcaxcs, 9.48%comparui w an expected ~i.90`;'0, and ]ugher than expected benefits fur new retin:es. In addition to the City Contributions, ihcxc are expected member contrbutionG of $4,Ot1G,Ol0 and contrihtriiatu from the Short= Pkana of 5120,349 fund tlx;-ten year ccetaiu acid lifa farm of benefit payment. The assumptions ustd in the vatuntitm rite outlined in Table JCL Provtisioas of the. plan are set forth in Table Xll. There have been tto changes in !]x: assttmptions, methods, ar plan provisions sine: thu previotu vduxtion. iGC C~6'Stia PaM•isr%n1v, stile t6Ca • A1~Me; GA 3 0.33 8 59 4 5 lfi.tui`i$3s8.779.9.Z1.833i: Red Paq~ f Hoard of'tnistc;as Nlarclt 18.2008 P.~hctlmnnailti;aoi JeacL~2,M' Si hauanrnl?Valuation IU~O1~XAlilRrpotK12UM dal I,a.~c buckcor~ultants Page 2 SUMMARY O~ VALUAT10iV RESULTS TAB~.E ! As of Aa of Octnher i, 3006 October 1, 2007 1. Number of?1lerubers a Active Membzts 476 482 b. 1)afc..ad Ve;:ed Mehtbers 12 17 c. Retired ~lecrbers: i. \on-dic~bied 410 420 ii. Uisablzd 60 51 iii. Beneficiaries 90 91 iv. Sub-tnurl 6GU 572 -T d. Total Matnbers 1,048 1 3. Total Ann~alGomisaasation 535,354,776 538,705,407 3. Yrojccted Payroll 536,592,193 S40,Od0,096 4. Total Retired Member Benefrty 53.1,710,489 533;930,403 5. Annual Cnst a. Present Value ofFuturol3ettefits Sb56,373,677 $712;54?;018 b. PresentVa]ucofFuturel~lottna3Cost 574,3J7,381 $79;152,431 Cay Po~°n S(J, 313, 3t.4 Su,331,219 ,Hanber PaROn c• Actuarial Accn:ai lit+bility (.qAl,} 532,08(,li38 S~R2,016,29b Y3;.310.71? $632,992,587 d• ActuarislValtreofAsszts {$»70,603,1 44) {$495 993 903) e. G'nfundc:d A.'LL, (LlAf~;I;} ~ _ $11T,4i3,152 _ , , S134,998;684 f. Normal Cost $1(1,938,820 $11,781,904 g. Paymant to Amortiza 1~nPunced I.lability 57,692?60 59,534;20R h, SetviccRayback }2,(i12,S71 $2,203,305 i, Adrz;ztis~~tive Expersrs 0633s_13 5646.588. j. Total S2b.277,254 $24,166,005 k. Hx#x:cted ivicmbat Cnn1-ibutiaus $3,659;2:.9 $4,006,010 t. Expaetsd Shs.~ Plan; ContrYbutious $120,549 $'20,54y ut. EstimatcdCitl~Cormibutiors _ $_7,a~7,496 $20,C39,446 n. Tofai $21,277,264 - - }24;i6b;005 b. Annual Cost(as a % of Projected Payroll) a ?oral Requirzd Contribution 58.15% 60,32°io b. Estimated Share Platte Co*.tttihution 0:33°0 0.3U% c: Expected .~Sember Cnnuibutior. l O.UC,% 1 UAO% d. estimated City Contribution 47.82;0 50.02% City Persion Fund for Firsfrghters and Police Officers in the City of Miami Beach page 3 GAiM AN17 LgSS ANALYSIS TABLE ii i. AMUnI Unfunded Accrued Liabi[ity as of October t, ZU06 $t 11,4:3,! 52 Z. Expected Change in Unfunded Liability 1luring the 20flfi12007 Pian Year a 7h~e to Emnloyrr \iomtal Cost for Benefits 59,935,285 h. Due to lntct~st on UIe L+nfi:nded i,iab?tity 59,470,1 t 8 c. ):tpected City and State Contributions {;~17 618 045 d. 'Toil Expected Chang:: , , ~ ~ $1,777,358 3. ExQe¢ted Uufuuded Accrued Liability as ul' October 1, 2fl67 5113;1.90,510 4. Cl:nnge in Unfunded Liability During the 2Ufl6/20fl7 Plan Xear Due to: a. Vtettiod change., b. Assumption chnrt es ~ g c. Plan atnerdments a0 $0 d. Experience e. ToUzl change $?.3,80$,174 $23,808,174 5. Aetual L:nfunded Acorued Liablity as rtf October 1, 2007 ~ 3 -gg~~ -~ b, Items Affecting Caleulation of Accrued Liability a Alnn provisions reEected in the acetited cability {see Tabte XII bn page 33) b. Pisn amendments retlectad in item 4.c. above {see on page 36) ::. Accaa=iz! assuutotions and methods used W deternirc accru:;i liability (tee Tabic JCI nn page 29) d. Chaages in actt~aiia! asstttttptions erd methods refleC~ed in items ?.a. attd 4.5 . above (see on page 32) City Pension Fund for FireSghters 2rd Poii;.e C`fcers in the City cf Miami BeacF. Page 4 UNFUNDED ACCRU€b L(A81L1TY CONTRIBUTION RA7F Ct~A NGE TABLE tl (c ant'rnued) 7. Expected Unfunded Accrued Liability Cantribntina Rate as of Uctobcr I, 2006 21.02% 8. 1\et Actuarial (Gains)lLosses Durieg the 3006!2007 Plan Year a. Due to SalarylService/Data ~ -68oiu h. Due tv Invcsnncnt Pert~~nnattee 0.04% c. lhce to TunroverR~lortality t0.I2%) d. 17ue fo \'ew lt_otuemeats and Ret'vement Aeaclits 0. t 8% e- Due to :'slew Members U.08% f .ice 1.86% 9. Clrangc fn Unfunded Accrued Liability Rate During the 200fiI2001 Plan Year Due to: a, Assumption changes 0.00% b. 141ethod changes 0.00% c. 8ystcm benefit changes 0 00".'° d. Total C}±ange _ 0,00°.!0 10. Other Effects 0.92"/° 11. Unfunded Accrued Liability Contributiou lZate.as of nrtoher 1, 2007 23.$0% City Pension Fund for rirefighters and Pctice Officers is fhe City of Miami Beach Page 5 ACCOUNTING DISCLOSURES (GASB 25/27) TABLE III A. Number of Pian Participants as of October 1 Ylaa Year Plan Year 2006rfl0? 1fl07/2008 a. Retirees and beneficiaries receiving benefits b. Terminzucd gisn participants emitted 360 572 to beat not y~; receiving Fk.aetitg 12 17 c. Active plan paricipauts 4?6 482 d. Total _ 7,043 1,071 B, Development of Anneal Required Contn"bution (ARC) 312,03C,3i'k 513,5Sw.SO4 {53,659,219; $9,925;235 $656,;?3,67! (547„3I3~343) {$32,044,033 $532;016,296 (.$470,603,144) X111,413,153 57,692,760_ $17,618,045 --•---- C. ~naual Pensioa Cost and Net Peiasion Obligation {TYPO) a. ARC $1,231,417 317;618,045 b. Interest on VPO $p $0 c, AdjusLmrat to ARC gp ~ d. Annual Pension Cost $13,231,317 517,67.8,045 e. Conttibutiosvs made f. Increase{deerrase) in NPO ($15,231,4.17) Sp g. :~1P0 (t+eginriay of Yom) SO a tiPO (end of year) _ 50 Cibj Pension Fund for Firefighters and Police Oftlcers in the Ci±y cf iNiami Beach Pie o" AGCOUPIT#NG ~#SCLOSURES (GASB 25127) TABLE 4## (confinued} D. Three Yeac Trcnd In£orntstioa YearFa,dcd t Scptent3:er 30 i Anm:a; Pension Cmt(,A_pe? I Petr~-stage 1 C:acririSutcd N..t Pcn;ioa Obl~on 200? 2~U6 2007 511,978,:55 324,GU:,836 $15,23.1,417 100°~0` JUU",% I OU% 0 U U E Schedule of Funding Ptrogress Acfuaria# ~ iJA4L Acfttatial Actuarial Accrued Unfimded as'% of Valttation Value of Liafiility 9.A1, ~ Funded Covered 1 Covered Rafe Asse's (.!\Ai;i (tl~~ALj ltafio Payroll Payroll Z)_lI~ ~ (l)''(3l ~3~"~SZ 10/172002 5400,898,095 5424,719,584 523,821,489 ' 9<!.4°/. 5.31,294;709 . . :6..iY° 1011(2003 $410,421,395 5468,290,269 SS",866,674 87.6°,1 532,115,520 t i80.2Y° lOflr?0[14 Sd18,089,22~ 5512,038,433 .!'93,949,211 81.7°ro S33,7?5,380 287.1% I-0112005 S45?,580,582 5551,907,b78 $94~27,06b 82.9°.x° 531,259:918 301.4% 70/1(2005 $4?0,603,1-14 5582,(II6,296 Si 11,413.15? 80.9% $35,34??F 3.(5.1% I.0/F/2007 5495,.)93,9fr S6?1.,992,58; 5336,998,68a -_- 78 Q'~; $33,"+05,4U' j '~ 354.0°6 F. AdditinnaJ In£orma6on VaJua:ion date DCOber1 ZOOG Cktoher 1 2007. Acttutrial cos[ method Entry ~o \rnmal .. Fmtry,Age Nomta! A.morii7aiion method r,evelPercatt Closest (xad Pwccnt L`loacd Rt2maining autortiisfion ~•lod a w 30 Years 24 w 30 Yeers Assef valcayyoII mertud Acltaarial assttmmians; ZwLskr2 Related Value ~arkn Rrlsted Vulae Tnvestrneut rate of retu.^.r 8.50% 8.10% Projected salary increases a.51 0. 1 n.17% ~.;;°i. - n). t'rv° L't.:ludes pr~jectecl pa}toll 3.s"0% .SOy° Cosf-of-living adu;lmerrts 2.509 2.Sn°.u City pension Fund for Firefighters and Palioe Officers in titre City 3f tvJiarni Beach page r PRESENT VALUE OF ACCRUED BEI~i=FJTS TABLE IV i. Actuarial Present value oS Accrned Beaefiis As oP As of Uctober 1, 200b _ Uctober 1, 2007 ""`" a. Vested Accrued 13eneFb: i. Iaactive memix~s and bcneffcia*ies $3 J8,85i1,? 5; sa3s;Q3~,651 u. Active members $112,990,269 _ 5119,890,581 iii. Suh-total $511;340,5X. $ii?,923,^_32 b. Nau-vearoed Acoruod Benefits $29,883,249 ._,._. $3Q,17?,659 c. To~a1 BeaeSts $54.1,7 ,~ S58_~ 8u 1~"' t7 d. Marltet Value of Assets S511,508,858 $5?1,193,561 e. Percentaee Fpndcxi 94% A7%° 2. StatEment ofChange5 in Total Actuarial Pres¢nf Value of Ail Accrued Beazfits a. Actuarial Present Valgc as of Uctober 1, 2406 5541,723,769 b. fncreasc (becrease} lluring 2006.?200? Plan Year Attributabteto: t. rnteresc $a4,6?o;910 ii. Bcne`atsaceumuiated $:i4,()?3,514 iii. Benefits paid (532,36?,302) ic.. Meihod Change ~ v. Plan amcaument, $0 vi. Char.Bes in actuarial assumptions or mctitoslb $0 vii. Net mcrc;ase (dect~cascj 546,1??,122 c. Aciuarial P.-eseat Value as of October Y, 200? $588,1ll0,891 3. Itetas Affecting C'alrulatioa of Actuarial Present Value of :4ccrucd Benefts a plea provisicrs re:tlected in thcac,-reed benefits (soe fable YII pr~3e 33) b. Actuarial t:sstunptions and czethods used to detzrmine present va2uzs (sec TabFz k7 vn page 29) C:f,, Pension Fund `or Firefighters snd Police Ofricers in the City of (>,tiami Beach Page 8 {NFQRMATION REQ. BY FLQr~fDA STATfJT E CHAP 112) TABLE V Qetnher 1, 20Q7 ~0fICe Sirefirbtetb TOt3f f. Participant Leta a. Active srxmlrers: i. tiumher 317 165 482 ii. Tom; atmual payroll 323,823,753 514,881,654 33%,705,407 iii. Projecu:d asmuatpayroil ';24,657;584 $1.1.402,512 540.060,096 b. 13otced membea ass<f tieae5ciaries: i. Number 305 JUG 51l ii: Total annualized'oetxt3t $18,484,029 $12,304,628 330,743,057 c. i~isnbled members receiving benefits: ii. Totalannaaliaed benefit 52,613,6&t 5523,082 S3,136,746 d. Tern:inauxl vestodmeaiSers: i. I\umbor 16 1 t7 ii Total anni>;+fized betufH 5243;050 429;71I S2'T2,7Gt Z: ASSets a. Acn:arialvxincofaxscta m'a ~a 548#,991;903 b. Metlmtvahxofa>seta n!a n!g Si71,t93,5G1 3. Liabilities a. Present va3ue of all fi:hrro expected henefd peymenm: i. Active members: Retircmen: benefits Vcsthtgbeael3ts 314?,893,388 $99,207,441 534'1,100,324 $2;852,119 51,614,743 54,466,9 i2 Uiwbi3ir9 bcurnrs $R.':85,ir71 $5,6`.2,735 515;c37;826 Death b~c5ts S b { S7 X45,.2: 54:241: 176 _- 51(; 13b_8V0 u -rota $FG3,T•~o~' 3110,^„6,465 $274,S12,3fiT ii. Terminated veered memixn $2,627;:'3 53f9,G81 S2y46,939 iv. RetimA members aid }:erlol.•ciaries: Rhired (other than disabled}and lxnaficiarics $236.?D8,489 51 ~7;7,i 5,73! $393,944,220 Dirahled members $.94,995,496 _ S6,I4#,976 $4 i,141,4~ Snb-that $271,:7Yi,939 Tlti?,881,70T $43#,665,692 iv, yfembcr ccntribvtions (annuities sg..e&:rds) 50 SO - SO v. Total present valve of all fuhtre espeded ben. ptru. 34~ 07,! 6c $174,9?,g53 $n2s45,ola Clty Pension Fund for Firefighters and Police Officers in the City of Miami Beach Page 9 INFORR1ATtON REQ, t3Y t:LOR1DA 5TATUT E (CHAP. '! 12 ) TA13t_E V fl etnber 1, ZQQ? (conflnued) Po'ca Afro t htcrs Total b. Liabilities Aue and uppxid 50 ~ CO e. Actuarialaccrued6abitity 5384,997,276 $247,995;371 5632,992,537 d P.atry Age Nomrai L§tfunded aetttarial accived liability Na da $736,998,684 e. Frozen initial Liability n<a nla N¢ 4. Actuarial Present ValneofAccrued Bene0ty 5358,477,911 $ug,~7.g20 5538 IO0.R9! (please referrnizTable 2V far details cnncetaing tftopn:sen[ va)tte of accried lxncfiw) , S. Pension Cnst (as a °/. ofpmteetedpayrnlq a Normal cost(inclttding admiaist:atiw oxpenscs}: 37.187° 30.?8%. 31.0^2°'e Dollar amoritu: 57,687,778 $4,740,774 $12¢28,4m b. Payment to amoetiu tmfiasdecl IiabAiiY D l] da tYa 23.80% n ar amount a/s da 59,534;20R e. Service i3uvback D SSO% 5.50% S.SOryo ollar amount; $1,336,167 5847,738 52,203,105 c. Amount to bo contributedlry inetnlxis 10.00% 70.00% 10.00:'; Dnllaramount: 52,465;)58 5.1.540.2`7 $4,006.009 d Erpocted SErnte Pimts Corrhibotinas 0.29',15 6.32°h 0.3C°io Dollar amo.tat: $70,6b9 $49,880 5120,549 d, Expaant.C'ity Contribuaoa uh rve 50.02°io Dollar arutaL:f: iJa n'¢ $20,039,447 ti. Pact Confriburions(FnryenrrndiagSoptember:10;20U;~ A. Required Etvployer and Jute caafriiunat n!3 r,!a $7 5,23 ;,417 b. .r1Ct4a1 (:On~Sibntiat7 L`nldC by: I. Esiployer ii M na n/a $11,170,868 . embors iii. Swc(Sbaro Plarrsj n'a nJa n/a nia $1,195,2R2 559 S120 , City P~flsion Fund for Fiiefighters anti Police Officers in the City of Miami Beach page f ~ INFORMATION REQ. $Y FLORIRA STATU TE (CHAP. 992 ) TABLE V (contifluetl) t?etobcr 1, ZUU7 olic Fire~Eh4~ Total 7, Nei echtarial (8ain~.'Inca n'a n`a 523,808,174 6, Otherdisdmures g PIC£~1[Valtte Cfac4VC 77!eml:CiS: i. Future salaries: atatrainula0e 5181,171,723 S9R;%8,,,943 5280,115,666 ei may age nfa a'a ry'a It FLmre COn[i lnU10AS: at attained ago ~'-3;023,024 S72,197,b88 531,220,712 ~ ~Y ~° u/a nta tJa b. Present value of fuatro cotre'lbntims &altt ~"fij and Start 529,185,425 514,744,794 544,331,729 c, Present value of future expected banetit paytnentw £or Na rtJa l nc<ive meotbers ai entry a8c tt a rL Amoan[ofscifvememltets'acchartnlaeedcoatributioas $26,341,962 515,798:527 $42.140,489 City pension Fund fcr Firefighters 2nd Police Officers in the City of fvfiami Bach Pago f 1 INFORMATlpN REQ. BY FLOFtiAA STATUTE (CHAP, 112) TABLE V (continued3 (ktober 1, 2006 Po'ee kit-efir~ters Total 9. parffcipaat llata a. ,gctivc mcm'xrs: i. Number ii. 'fotalannuaipayroll iii. ?'rojectedattntrelpayro3l b. Ratired members sad benefici~ies: i. Tvwnecr u. I'auat annualized berx5r c. Disabled matnxrs ccceivieg benefits: i. Number ii. Total otutualimd.benefY d. Tzrsrtinated vzsiod mernbcts:- i. Nurolx; u. TOtalammalizndbenetif 10. Assets Armorial Valtm of Asse>, blarJ<zi V slue of Assets 11. I.iaDtllties a. ('sestet value of all lirtwd eRpzotzd bcaofnpaymcnts: i. Active au:ail>ats: Retaetnent beno8:s Vcsting':e..tc~ts Di`ability bznofits Daatb brnufts Sub-tots( ii. 1'znrrinated vestedmentt-rs iii. Retired mernbc~s and bcacficia:ies: Retirori (other iltaa disabled) sad ~eficiarics I)ivabtrdmuutbers Sub-total iv- 4izntber contrtbrti~uts (almaiGeg ~ ra:itnds; v. Totaf cresent value of atffim:tc cxQecte<i bet7, pmts. City Pension Fund forfirefighterssnd Police officer; in the City of Miami Beach alt t5d. 476 321,689,5(5 513,463,211 535,354,77h 532,b55;1W 513,936,493 53t5y1,193 300 200 500 517,j74,836 511;141;392 52R,Slb,?2S 48 12 60 52;337,524 S556,737 57.,894,268 11 t 1? 5^255;627 529.7] 1 5295,338 n!a tvh 547(a,fA3,144 ttla Na $511,SUS,S58 S134y34;854 ~i3,217,i)5. 5228,]51,979 52,E54,6'34 S1,499,13R S4,1S3,772 $8;772,985 35,003,430 513,775,435 Sh,579,Oy4 S3,8t 1,515 S[0,390,GV9 5152,941,5"''? _ Si03;531.21R S256,472,795 52,SW,034 529~I,Y9 52,794,433 5216,33?,35D (142,392,013 5:;59,22'),373 i.ti,?32,571 36173,724 S:S6,32b.395 5247:90,0:31 51.49,,755;737 $395,055,768 __ 5657.9b4 -~RY.T 3332.b67 -u~ -y S:,i750,531 ya~~~ 5403,349,50E 5252.1?4,971 S635,2?3,677 Page 12 1PJFORMATION REQ. BY FLOfttDA STATU TE (CFlAP, 112 ) TABLE V (ca[rtlnuedj October 1, 2006 Yat;+`? ~Irefighfers Total b. Liabilities doe and unpaid 50 SU „p c. Actuaria] accrxd iiahtiity S3S4,275,670 5227,74Q,b2G S382,Otb,29G d• Unfunded ;actuariaiaccrucdliabillty wa ~ a a 5111,413,752 o. Frozen Ioilial liability a'a Na as 12. A..ctaarial Presonf Yalucaf Accrued liertefiu '5330,443,317 5211.280;458 5541 76y 523 (please 2foreucu Tal;le IV fot details concemin~ the present , , value of accrued bmefis) 13. Pension Cost-(as e% of payro)l) a. Normal chat: i. .Dollar antotm:: 31 A09'° 31.y9`l'° 31.G2°l° $7,113,479 54,457,934 $11,5'!1:933 b. Payment ro [ononine unfunded liobility da ~. Du1laramoum: n•'s N 2L02%° a 57,G92;760 c. Service buyback Dollaramo[mt: 5:50°/a 5.30^/o S.SU'/° 51,246,064 5766;507 $2,012 s71 d. Amount tohc cmtttibc7ed by members 10 0 ° Doliara o ut . 0 /^ 10.00% 1 O.atr!b m : u $22bS,570 51,393,64y 53,659 X79 e. 1:ttpea.2ed Sbarc Flans Contributions Dollaramou [ : u 570,669 549,880 5120,549 f 13xpeetod Ci;~ Con7ibu[iun lloilaramoinr Na. Ne 47.81°!0 . Na Nxi $ i 7,4y7,A46 14, past Contributions (iror year endfug Seplember30,2006) a, RequiredT;mp;oyerandState:.onrribuion run Na 514,601,836 b. Aotual uontti~utiw made by: i. Employer ~. ICI"tubers nra ' n/a 514,4R7,2R7 iii. state (Sbxro i'lans) m a Na S-1,915,270 ara Na Slzp,~49 City Pension Fund for Firefighters and PoliceAifice7s in the City of tvliami Beach Page 13 Police ~refiehtels Total 15. Net srctaarial(gain)/loss >;s Nsr 520,303,584 ]G. Otber disclosures a. Htseat valtta of acme membat~': is flwtresalarics: ai attanedage T1GG,840,927 S87,G91;329 :5214;532,416 at entry2gv, n+a n;a nYa ii. FU!urc contrbutiarx: al attaiuedage 721,264,558 510,839;480 532,044,038 at curry a8o n~a n~a a;8 b. PCesr.M valve of fatttre coatriNutiorss from (:ity and Stan 527;919,37$ S143939G1 742;313343 c. Present vxioe of fv¢ure expected benefit payruents f~ :active ateatbers at raw a8c ax Na -Na d Amotmtofaetivrme:nbers'xecutau(aredcorA:tbntionv .S23,333,533 SI4,892,192 538,201,725 City Pension Fund for Firefighters and Police Officers in the City of Miami Beach Page 14 UPdFUNL?ED LlABl ~,lTY BAS ES TABLE Va 2oobn9o7 m9-~SOR ()OUtandia8 At'~W Ontsuodia„ LxpRted (1riRtO>ti Sa)aacessof AwortFcatinn Uxlan<e saof Amorlaatlrn yexn Description .Ueoani October 1, 2006 ~1's}'mtai OrfoAr. 1, 2007 Ya.7ne9t RroteioieS lnitia: trni'tmdcd i.iut iliry Sii,39),Tab Y~',L 1,321 SS7S,836 Siyi96,847 fS06.4>•8 74 1U/0120U2 '~fechru!CanOBc $12,519,713 513,459,594 5955,OS2 Si3,o9f,977 598S~S2U 25 10/012003 Arretulaai 51,078,53? Si,142,337 579,314 52360337 382,093 ~ 26 )9rUlr^^<Oi3 Hxprie0ce-LOSS 331,4i3;D33 S34399326 32;988,U4S~ 514,435.22) SI,47i,~i30 26 {OrOS""2004 Fapnrirnae Loss 334,892,889 336,271,212 52 +T_;!I'J 336,86(,347 52,SfA ~1 7.7 i0.~01.2005 Metb0d Change ~L3t,07433^ 531;66?;$93 -5_'+,+21;849 .132. ^3i,ti2 -32.195,183 ?8 )UKfl:i-0OS ASSVripOOO Ciw.yc 56yU39% 563611,526 5!27,192 56 48;984 5442 143 28 tU7032005 E.itFpicrc: Loss $73,210;340 .527,!40.700 $1,,86,380 , S?4,074,630 , S3,44;,994 28 1MOL2006 Method l3t4ngc -51,890332 54,640352 .S?^,9.',33 -S5??9,29, 5320~T ?9 IQg12006 F.xpm'ieaca LOSS 00303,38. $20,303,581 2:340,771 310,688,616 $1,381,697 ~ ILUOIR007'Fxpaticace LOSS $75,80$,1 i4 523.808.17? S),572,26Y7 30 ^ Total 3130 073 904 51$ 4,3 152 57 692 785 , , , , , , 3{96,998,684 59,34 ;258 :dy °ension Fund for f=irefighters and Pofics Officers n the City of i>,tiami Beach Page 15 ASSETS TASTE Vi As of As of October I, 2fl06 OcFObnr 1, ?007 I. Market Vafue of Assets'' 36.020,000 $75,534,671 $i4I,R5y,122 $234,?26,015 55,260,968 SO $IOS,054,959 $8;214,iR2 $2;935,283 S16S,985 $0 %AB,~ I4,1 R2) i3368,44~1 Css7i,I4s,s6i 2. Actuarial VatUe of Assets Si71,'.93.Sbt b. 5•yex phase-in c. LUOfiP_007 ~(s~'S7_642,ti43)f h. Totat twrecognizc:d tosses~bains) x 1096 = 50 x &n% = 1$36,335,615) s 8096 =- i$46,U4,It4) f375,IN9:658) $495,993,903 City Pension Fund for Firefighters and Police Office*s In the City of PAiami Beach p3s,E, 1~ .($40,905,714) c. ActuarialVali:eofAsscts r $570;6Q3,1.~t~ Rirm a. less iiFm b., but within an 80-I20% cor~dor oft'~etn a.} ASSET RECONCILIATION TABLE Vta L Market Value of Assets as of October 1, 2x06 $511,303,358 2. Increases Due iD: a_ Conuibutions: :. City 31 ~,] 10,868 ii. State (Share flans) $120,549 iii_ °~Iembers S5,394,7..52 tV. TOtFtI 520,425,69` b. 1nc~cstment income (interest and dividends), not of expenses $14,63pY251 c. Reaiiud sad u.~realized gain3!(]osses) $57,642,643 d. Total increases $g~ 2 60 3. Decreases Due fo: a. Benefrtpaymcnu ($32,241,728) b. Refuud of member contr_bu[icns ($125,574} c. Administrative exyensc_ ($646 SS8) d. Toms d:cre2ses , = •---~ ($33,p"-- 4. 'Ylarket Value of Assetaas of October L, 2Q07 $S7I,193,551 Cily Pension Fund for FirAficdhters artd Police OYcers in the City of Miami Beacn pa~z f 7 H18TORlGAL ASSET INFO~tl~9ATit3N TABLE Vtl Historief;!Market Valae (J~ssets & ltetarns) 5600 S~iU ssnn Sass Sao a $35Q 53UU ~, $250 5200 5100 S50 t4orlpet AUOarial c{ty; State mt6 MerAtt Atluerial Plmt Valve vof Value ac of 1lntefit A tlro3rtistrmlvr Mrn(Ixr Value VaLte Yept Y]WLLYt~ /~,,~,,~,_ Odn _Il4C1 v Pll3YRgkly_ ~ f~ 4~~twy ~utg j2~gR 20(112002 5373,319;Yi7 7404,340,268 520,210635 Sd9S,Q2S 37,753_i'24 -LS5% 2.195;, 2002/2003 53?3,980,268 5400;$98,095 $2«072,374 5521,1?3 Y11,bl~t,R55 15.05% d.R2b 20032001 S4i9y;2;a?f 5410;423,591 52x;173;338 5563.532. 514,082,481 9:719, 4.32% 20(M20U:i 5449,622;X48 S~1tx,0,C9.122 527;202,700 7581,953 516.960,734 y+)9N% f2.22'°n 73HK2006 7483,180,441 5457,G$0,i82 .5.10.109,229 5633,113 719,317, U.K 3.38% Sd4y-o 200G~200? 351 i,50R,RSR 54^,0;603,144 $31.367,)02 $646,SA8 520,421,699 14.31°k 8.189~s 2007200$ Sii (,193;561 5495,9y3,903 • inchuias cwvilrutions nfuudcd City Pension fund for firefghters and Pr~iice Officers in fhe City of Miami Beach Page 19 REVENUES BY S©UR~E AND EXPEPISES BY TYPE TABLE Vila _ ILE't'ISN i?ES Focal fifty Share Plane ASemlxr Total Net Inreb~t, Ycar Contrib. Coatrib. Co>,trib. Contrib. Incaine Tota! 20008001 $T 3,425 X3,577,B78 S4,311,i03 ($38,313,700} (534;002,397} 30Ui _002 53,510,328 ' 54,242 ?96 $7,75.i,32E (51,027,634) 56,725,690 200AZ003 S8;577,326 34,437,529 $13,014,855 551;574;885 568,535,700 200?.2004 SY;38',;097 $10?pCV1 54,588,390 524,082,481 1640,305,815 35d,38S,297 20048005 511,857,606 31?0,549 $4,98'}; 579 S1d960;734 544,381,517. 55],342,246 ZOOS7200ti 514,481,237 5:20,549 54915,270 $39,51?,IU6 S°9,553,633 S59,070,759 20062007 $15,110,863 5120.549 55;)94;282 S2G,425,699 372,2 12;894 592,69B,S94 ~ICPPI~SES Flerel i3eaeGts Mewlxr eldtelinisirative Year paid. 12eiands FsPcases. 'Total 2000/20!71 .2001.2002 2002t2U03 300320G4 200480G5 2005,2006 20468007 518,999,1%0 520,107,250 S2I,S19,356 X24,I30a99 527;163,740 S3g048,732 533;241,723 575,154 5102,385 S1S3,01R 543,039 533,960 S6g497 5.125,574 SS2b,iS7 £49$,821 $521,173 5564;532 5581,353 x633,1'.; 5646,588 St9,600,491 5?,0;709,460 522,593,5x7 524,?3 i,8?0 527,784,653 X30,742,342. S33,Oi3,890 Cry Psnsion Fund For Firefighters and Police Officers in the City of Miami beach Page 19 CONT1218UTIO1~15 VS. FUNflFAYOUTS TABLE Vill .. __ _ - ~ Ilis4orical Cnniribttfiops Versus Benefit Payments & F.,rpenses* i i i 1 .. _.. _ _::Q__. __ ~. ..~ x ~~. < O C me®r 0.1_..:x`_.- ---~-------..-~': r--- _.®:;~.:.~..:~_- - -~- 200112002 21102/2003 2003~;t004 200x12005 2005/200b 2006/20117 Plun Ye~ac " Y3e~se rcfaranc~'!'ttbte VItu on page ae7d cautiibudans. City Pension Fund for Firefighters and Ponce Officers in the City of Miami Beach Page 20 ,~ 1. Actiue Memkers a Folico Otliceta k. Fire4glttero c. Sub-total Z. YOtt-ttctive, N'on-mtired MemAera a. Fully or pat1ia11y vested b. 13etteticiruiea c. Sub-tidal 3, Retired M1Iemkera s. Non-disablcYJ(including I)ROI~ b. Aisabled c. 13uta1sciarie; 6. Sub-total 4. Total Membrrs e~.9 OI f~.9 UI OCtoker }, 3UN¢ Qetoker 1, 2007 a'i2 3i7 ifi4 145 _--47+i 4N2 i2 17 V 0 12 ~~ 17 410 420 40 41 90 _ 93 560 E,U48 5,(171 City Pt3rtsion Fund for Firefighters and Police OfFicers in the City ofi Miami Beach p~ 21 lovlnonl tavtrnwz lavo ln_oo: larouzoud I nnlroos larolnaoG m.atr2Dm .. Aa or October l: ..ornm: ___ °°'!""'.Aver - _- ~ ___.. _... _. ...~ !tgr 5nvx° ^'y"•.\~wrige ilge ..._ . . AvrrnlCe. A]ttnlle .._ .__ c ....._cvr AeeraKe AvvaSe Se»•ire Atained Servier Attained Dah HatcpN A ~DNe Rarne-0 ~A r^_ 14,bU2JG1 11.4 39b 1pb112005 1:h 40.4 10'`01!1001 11.6 39.9 iC101n096 I.I.O 4U.0 laotaoo3 129 doz. 1N01t1W7 123 dds ]WOtlNn]4 129 40.4 75.090 _ _ IliaNri cal Salary NMe 69.[00 .._ _..__. __.___ .__.. _ __.__ _ .__.~20'p .Nt ___ _ _ _ __ _- X13 G.A ._ __- ... ... --._SX p _... __•'__ __.... . __._ _ _.___ $ I. OY. 5, ;pn H ^J9: ia- gn:ep Ukl', L ~~ IpAVCr 2094 e6CS4.]ry IWbi :Ord IJ,u.^. A.~tauv4J?num: :4z ppp; n u:~iu lnrrcu:~ ~1, ., ll~z•]; Gi' i Aetnnl Aeerage Adaal Amapp AreraSe 5afary Aaapmcd AreraDr Salary Assnnaed Date Saluy )peruse. )pereaae Date Ss)sry Incrnae lpasgse IU~UIRC01 SSA.149 3.78•% 4.RIx i9lOD2Cd)5 568,85] s]p"1° 4.SOx 1WT112001 961,Sa7 A.58x 4A?x !Q1)U2rAK 57x175 7.8i : 9JOM t~b'OU2093 Sf.5,145 6.8546 4.82% IUNi :J17 $89.302 9.48°,: 4.90Y fW012W4 5G7 Ofi0 6.15?A 4.82°.4 City Pension Fund for Firefigtlters erd Polrce 0ificzrs in the Ciry of 14fiami Beach Page 22 DATA RECONCILIATION TABLE IXc A 've Non-rEtired etir Tnt I. Number oC members as of October 1, 2000 476 12 X60 1048 Z. Change in status dnrutg the plan year: a. Actives who terminated b, Actives who retired c. Inacxives who becauxe active d. Inactives who retired e. Retirees who became active f. Dormant 3. Na lottger merabexs due to: a. Death b. Pezmanesrt break-in-servir~ c. Receiptoi'iump sum payment d. Expiration of pertain pccind e. Included in error last year 4. New memtxr due to: a Initial membership b. Death of another member c. Dormant d. Reinstatement S. Number oC members as of ~`'~' ^~~"-~~" October 1, 2007 482 17 ~"2 ~ 2,071 City Pension Fund for Firefighters and Puttee Officers ir• the City or ~rliami Beach Page 24 AGr_-SERViGE-SALARY TABLE TABLE !Xd (All Aclive Members) `~ Age i IIHder 1 1 ro 4 _ 5 to 9 10 ro I4 Comple 1^: m i9 ~ ted k'ears 20 ~0 2J o_f Serric 25~m 29 c ~. 3o~m ]"4 ~ 33 to ]p 40 & ap --` Total ' UHdef 25 P_vg.Pay 7 54,491 2 60,494 0 0 0 0 0 0 0 o ~ 0 U ! I p ~ 0 ' 0 0 0 0 3. 38,196 25M29 ' AvB.Pay 20 ' 56,422 19 63,022 7 81,544 0 0 U 0 0 0 D 0 D 0 0 0 ~ 0 ••. 0 4G 62,972 3U to 34 AoB:Pay 76 5'7,228 ~ 22 66,233 ° 2D 74,34F 0 0 O 0 • I 0 0 0 O 0 l 0 U 0 I 0 0 58 66,562 3S to 39 AvgPay. 23 ~ 5$,940 O 33 68,224 r 44 79,463 7 8'1,34? 3 ! R8,TT5 t 0 D 0 0 0 0 0 0 0 0 IUO ;3,651 40 to 4a Avg.Pay G 56,574 14 67;771 4S 76,Y28 30 92,085 23 45,871 15 105,?29 1 Q 0 0 0 U 0 0 C ' 133 84,8tj5 45 m 49 Avg.Pay 2 ei0,263 6 73;963 10 71,98? 26 86,14$ 38 44,780 31 107,546 0 0 0 0t 0 0 0 0 ID2 93.400 SO to S4 Avg.Pay i 0 0 4 64,168 2 73,254 5 87,073 8 93,831 8 105;379 o 0 OI O r . d 0 0 0 27 4vj,C86 SS in 59 Avg.Pap Q 0 1 63,33$ 0 0 2 84,087 7 87jI3 2 93,774 0 0 • 1 D 0 -0 C 0 0 12 SS 972 , 60 fo 64 Avg.Pay U 0 0 0 0 0 0 U ] 78,92[ Q 0 U U 0 0~ 0 O i 0 0; 1 78,921 653cap Avv,Yay D o~ 0 o 0 o f 0 Q 0 a OI ti o O( o f 0? n OI Q r 0 o 0 o 70&up • Avgray 0 C 0 0 0 0 U C 0 C 0 0 ~ tt U~ C, 0 0 Il .- 0 ; 0 0 p~ ~ Total I .4vg.Pay ' s7 56,588 ~ lot. i 6G,73U ~ 128 ~ 6Q 7',45a 89,498 ~ 8D S3,9I7 1 s6 06,123 n ~ D I o ; D r 0 U n 0 - aaz 80,102 . _ _ f Ci,y °ersion F:unc for Fire`rghters and police Officers it th= Ci±y e# Miami Bea.^.^ 'sae ~,~ ABE-SERVICE-SALARY TABLE TABLE fXe (:Police Offii~cets) Attattted Aqe ------- - -- i Crxnnicted Years al Service IIa6ar I ! t~ 4 5 N 9 10 to 14 t5 to 19 ?0 W 24 25 to 29 38 to34 33 M 39 40 R ¢p Total iintler25 1 , 0 U 0 C ~ p ' 0 0 i 0 ~ 0 1 .gvg.Pay 54.491 0 ! G 0 C 0 p 0 0 O I 54,49. 25 fi 29 20 6 0 0 0 0 C 0' U 0 26 Avg.Pay 56,+!22 70,R7i 0 0 0 0 0 0- , 0 r 0 59,756 30 to 37 16 1R 5 0 p G 1 0 0 p p 3~ 1 AvgPay ! 17,228 57,99ti i 166,460 0 U G 111111 0 0 0 0 ~ ? 63,382 35 to 39 73 28 t 38 1 1 0 0 0 0 0 81 Avg.Pay 35,940 ~ 7C,056 r i 79,249 75;056 75,03fi 0 0 0 p 0 72,22', 40 tp d4 G ~ (4 35 19- l3 I 0 0 0 0 88 Avg.Pay 56,574 1 67;771 'IS,b62 92;530. 91;680 80,51[ 0 U p 0 ''9,169 d5 iod9 1 , 6 ' 1 1] 37 4 0 0. 0. 0 56 Avg.Pay 60,263 73,63 74,S4b- 83,531 92;466 88,348 0 0 0 0 85,617 SOto94 0 C 2. 3 t 5 0 'U 0 p 79' Avg.Pay 0 64,168 ;'3,254 83,387 84,361 102,024 0 0 0 0 R3,n67I ! 55 to39 0 1 O r I 4 8. 0 0~ i 0' 0 i 6 AvgPay 0 63,352 0 86;845 79,343 0 0• 0 0 p 77,862 60to64 0 p 0 0 i ~ 0 0 ~ 0 0 0 1 Avg.Pay 0 0 0 0 ?8;921 0 p i 0 0 0 18,921 G5 in 69 0 0 0 0 0 U 0 0 0 0 0 P.vgPay G 0 0 0 0 0 0 0 0 ~ O; ~ 0 7o&~y a p a G p o o a o p o AvuPay o u o o' ^ o p o ~ o p o Total 57 ", ; ~ 8J I ~ 35 51 ~ 10 ~ 0 ! 0 rl 1 0 , 317 Avg.Pay .. 56,.5258 69,134 76,554 88;271 89,827 ~ 94,gp2 _ i r, i o a o 15,?~a Ciiy P6nsion Fund for Firefighters ar2d Police Officers ~n the city of Miarni E3a~ci3 Page 25 AGE-SERVICE-SALARY TABLE TABLE iXf (Firefighters} Attained Co~Ie tcd Yesrs of Senil e Age Lioderl !m4 Ste9 IDw74 tiw19 ~ 20 w:4 2,i M29 Wto 3a , 3iw39 4A&op Total T Under 25 0 Z 0 G 0 0 0 ~ O I 0 1 Avg.Yay 0 GD,499 0 t 0 0 9 D 0 C 0 2 60,499 i 25 to 29 0 13 I~ 7 0 0 C 0 0 0 ~ 0 ~1 Avg,Pay 0 59,399 1 81;349 0 0 0 0 0 0 0 ~ 67;152 30 to 34 0 4 li 6 0 0 0 0 0 0 19 Avg.Pay 0 58,297 ~ 77,035 O l 0 G 0 0 U i 0 73 090 , , 35 ta39 0 5 6 6 1 2 0 0. 0 0 0 ~ Avp-Pay 0 ii,99S 80,816 92,723 1194,734 t 0 p p 0 ; 0 i 7,~~~ 40 tu44 0 0 30 11. lfi 14 0 0 0 0 45 Av&PaY 0 0 80;459 97,317 301;320 106,995 0 d 0 0 96,005 35 to 49 0 0~ 3 5 11 27 0 0 0- 0: 46 Avg.Pay 0 OI 79,34& 91,9T 7GU,461 1:10,350 0 0 U 0 703,984 50 to&t 0 0 0 2 3 3 0~ pi 0 0 3 Avg,Pap 0 O I 0 92,301 109,613 110,946 0~ 0 U 0 l05,7R.5 SS 4o 59 0 0 0 1 j ?' I 2~ 0~ 0 1 0 0 G Avg.Pay 0 0 0 8l,32A 9$53S 93,774 ;9 0 0 0 94,082 6G to 64 0 0 0 0 0 0 G; 0~ 0 0 0 Avg.PaY 0 0 0 0 0 0 0 U~ tI 0 U G5&up 0 0 0~ p 0 0 U 0 0 0 0 Avg.Pay 0 0 0 0 U 0 0 0 0 p 0 79&ap 1 G p G p Q G 0 G G G p Avg.PaY o c o i G o 0 o G o~ o i o l Total I 0 W I 41 25 29 4G 0 0 U' G iG5 A:vgPay - G ~ 59,015 i .__~ %9,361 __...--- ~ 91,215 I -~ GI;liO ;IC8;671 J 0 _ 0 0~ G , 90.192 i City Pension Fund for r`!refighters and PcGce Cfycers in `.he CiEy of MiamiBFach Page 27 1•IISTORICAL CONTRIBtITIDN RATE TABLE X ~- _Irnr.o°r° i <w.o°re i Ilamr 3 m.a~ a ~' b0,0% so.aYe 4o.n^% ao.oa6 Sfem6<r Exgectedfiry !1fenWer EtP<cled Ciiy [rb<af Conitfbntir:n Coobibufion Fixpl [:ontrfbntlon L.ontribation Year _ Percenyige perceataEe Year Pw-<enta8e.. P<rceoloKo zoofnnm 10.0096 21.sa°~ zoosaoo6 fo.olwe •i2'S96 zfxlzrzno3 to.twa6 36.zv^6 zoa~zoo~ 1n.a1°~ z6.;~iq° 7A03r21104 10.00%. 2?.2J°.d lU0'i2008 i0,00'Ye 47, 112Y° 20042005 10.00?6 36,0396 20p8r2009 IO.tifl°!~ 50.02°,6 Cit`f Pensiiln Fund fnr Fireftgttter~ and Police Officers in the City of fvfiami Beach Page 2$ Acz~r:~xiA1.. AssL-~i ~no~rs T~ASLE 1. .Actuarial Cost Aletbod • Entry Age I~Fotmal Cost lvfethod 2. Decrements of pre-rctirenient mortality among 30 .0011 I .0002 44 .0055 .0006 25 .W18 j ,0004 50 .0017 0009 30 .0020 .0005 :5. .0112 . .0003 35 40 ~ i :OQ30 0043 ;Ot105 d0 .Oi18 .0002 . .0005 64 .0364 ~ .0001 • Post-Retirement Iiieakhy :Horiality I9R3 C3roup Annuity Mortality Table • Post-12etiremenY Disabled IVforfalily I9R3 Group Armuiry lvfortality Tablc Disability Rrpmsentative values of ttx: assumed annual rates of disability among membets in active service are as follows: vrtllnary ~ Accidental I I Ordinary ~ Accidental UirabiC~ty ~ llisabllity !)f..ab03ty 1)isabllity • e R53e -- ~ Rxte _ A~,~ Rate f Ratc 7 _ 30 •0004 j .0003 43 .OOi2 .0026 zs onog I rwo, so onss o044 30 .0009 I J AC0/ SS .0074 .OU63 , 35 A012 f ,OU10 60 .Olio :0090 40 1 .OOt8 A014 G4 .0143 .0:26 .J Citj Pension Fund for Firefighters and Police Officers in the City of E,tiami Beach Fage 29 City Pension Fund for Firefighters and Police Officers. in the Cdy of tvliami Beach Page 3d Average assumed salary iaerease rate is 4.9% ,AlCTI1r1RLaI. ASSi:l~ii'TTONS TABLE XI 5. Loadings for CoAtingencies • Compeusatinn 3alar~ rates have been increased lry 7:00% to ].gad for overtime and other pays. • Yre-EmploymeAt Sen•ice A City contribution of 5.>0°!0 of faded compensation is assuined suFficient to provide ibr the pvr: hale (or "buybuck'~ of pre-ainployment service. br the memLership. 6. Marriase Assumpeions • Yercent'.4Sarried 77/0 oftnenrbers are assuntcd.married or entitledio benefits for dependents, includiAg reg'tsrered dotrtestic partners. • Age Difference Belrveen Spouses tvfale spouses are assumed to be three years older than female spouses. 7. Expcuses AnticipatCii admitiisirative expenses are assumed to be fundrd through future. Giry normal WAtTlbllttpn8. 8• Assets Aciua_da( value of assets is equal to the market value of assets adjusted to retJect a fve-year phase-in of the net invcsKmeat gain or loss, Ai Qctober 1, 20t}5, the. "fresh start tuethnd" using the current raarkei-value ol'assets and starting a new five year phase-in of Tealixed and unrealized gains and losses was imp?em~:t?ed, recognizing one y:ar of asset performance in the actuorial value of assets. ~• Aggregate Compensation The aggregate compensation wed to compute the accrued liability conlriEution rate was asstvned to increase at a rate of ?.30% pn; year, Cify Pension Fund For firefighters and Police OtFcers in the Cit`j of PAiami Seaoh Page 31 A.SSC1lgi''i'iU~1 F,H~.NGES T~tLE XTa The following asstunptionshave been changed dtsiug tt~e psst few years: 1. Effective October 1, 2G02: The acttearia] cost method was chsrsged f otn frozen ittifiai liability to entry age: 2. Effectve Ocwber i, 2002: The amortization of the urSundcd accrued liability w;u changed 4ern level dollar to level percentage of nsy, with aggregate payroll assumed to increase at 3.50°% per year 3. Effective October k, 2005: T'ne "fresh start" method was applied to the actuarial value of asse4s to begin a new five-y~eat phase-;n of realized and unrealized. galas and losses. The retircmen> rates wee increased to reflect rctizement experience for participants mttdng the age 50 and "Rule of ~fl" eligibility criteria The loadings for contingencies and pre-ampfoyment service were iacreaseii from 5.00% to 7.00°k and from 4.50?jo to 5.50% respectivVly. 4. EfF'ectiv~ October k, 2006: The rtctwuial valualion system used by Buck Consuktants w,•ts upgraded. effective October 1, • 2006. The gain resulting frwu this upgrade was amortiGed over 30 teats. City Pension Fund for Firefighters and Police OfScers in the City of Miami Eieach Page 32 PLAN PROVTSIpNS 1'~iBLE XII 1. ~•Ionthty Accrued ]3eueFt 3% of ave.-agc monthly salary multiplied by service uo to ]5 years, plus 4% of sverage monthly salary multigded by service in excess of l5 years, to a maximum monthly benefit of 90% of avc~t:e monthly salay. If the member w2c emaloyed prior to July 1, 1976, the benefit can be no less than that provideZ by tltc poor Bass Plan assuming its provisions continue after its merger with the grior Supplemental Plan ("grantitahered Base Plan benefit"}. Average monthly seIsry is based upon. the aighesf ttvo years of canpensation. A lirrrited portion of overtime pay is included in 13re average monthly salary e:tcept when calculating the grandfathctcd }3ase Plan hcnefrt refereed m above. •• Service Retuement Age and Benefit • Age Age >0 or, if carder, the dale when ago plus service equals 70 (Bute of 70); Retiring members may also be edgihle to enter tha DROP (Deferred Retirement Option Plan). • Amount Monthly Accuded Bt:nefif • corm of Payment For memin:rs except those retiring prior to November S, 2003, tho normal form of payment is a ?57/° joint and survivor annuity with a designated beneficiary which includes 120 gu.uxuttced monthly payments. The members may also elect the actuarial equivalent, with a designated beneficiary; arty of the fnl;owing optional forms of payment: - 75%joint and contingent sur~~vor annuity - 66 ?O% joint ;tn3 contingent annuity with a desigrat~ honcficiary - SO'% joint and ccntingem annuity w;ih a desieyzated beneficiary - 2>% joint and contingent ennttity with n designated beneficiary - 10 ycaz certain and life amtuity with a designated tiencficiary kfetnL~:rs who retitvai prior to Novorttber 5, 2003 were subject to diEt~reYU normal and optional Forms ofpaymem. Ci~~ Psnsion Fund fir Firefighters and Police O~cers in the City of (viiami 9each Page 33 z~t,Ar~ Yxov~szo:~Ts ~r~s~; x~r 3. Disabt7ity Retirement Age and Benefit • Condition For a service comre~~ed disability benefit, ftie member ttust becorac totalty aad permanently disabled in the line of duty;. Poz a nort-service cormccted disability }senefit, dte member must otherwise become totally and pcrmahently disabled and have at least five years. of service. • Amount Far a service connected disability benefit: Monthly Accrued Henefit, with a mittimum benefit of 85% of contpc;nsation. For anon-sere:ce connected disability bane5t: :~lunttily Accrued Benefit. 4- Withdrawal Retirement Age and Benefit • Age Any age prior to 50 with at least l t) years of setvict; Service Retitemettt 'Ihe members may also elect the actuarial equivalent, wiili a designated - s~ ro lomt ana contingent annwry u,~m a desii~nated lxneficiaiy . - 10 year certain and life annuity ~yith a designated beneficiary Mcctbers who retired prior to ~toventber 5, 2003 were subject to differesrt normal and cpN.anat forms ofpayment. City Pension Furd for Firefighters and Police Officers in the City of A~iiami Beach Page 3a PT,~4Y PRODTSTQNS I'A.T3LE Xii 3. Death Bene&ts • Service connected death be»etSt Greater of iN.onthly Accrued Beaefit snd 85% of wmpett;ation payable as a monthly benefit to t~: widow until death, to unmarried childrea in exit;al shares until age 18 (until zge 3?. if a full-time student or tmtit recovey from disabili£y if disabled), orto depen~9et~t parentsin equal_ shares. • Non-service connected deafh benefit For metrtlxrs smith at ;east 5ve years of service, Monthly Accrued Benefit is payable 1'rr the fir>^. 12 moarbs after death aad 7~% of the A9ontltly Accrued Benetu is paytbiz thereafter (with a uiiaitrttnn benefit of 7.5% of average monthly salary); benefiU are payable to the wido•N until death nr remarriage, 20 utuuamed citildrea is dual shares until age iS (uatil age 23 ii' a full-tuna student nr i:nti] recovery frorn disability or until tttatriape if' disabled), or to depaadent parents in equal shares, However, if the membe::aas been inaried for less than ten years, benefits ate payablz to the spouse only for the life expectancy of the deceased member at titsle of deafh. Employee Contribationc 10"/0 of salary _aer year (on a pre-tax basis); If cnmtributions are refunded to the member Ur to Ms beneficiaries, then urtzrest is credited at the rate. of 3'% per atssttrm. Pre-Emp{oyracnt Serviec tvtembess with at Icast 2q yeas of service may purchase ttp t~ four total years of additional service cruiit at the 3°!° accrual rate for time spent on active military duty or outer full-time public safc2y service fir wlti::h na other benefit is payablr. Also; such mzmlx:r may p'.trchase an inctusz in benefit of 3°l0 or 6% wiihctut purch3cing service. Members purchasirtg other than military serviu: must also be eligible N retire.. The total o: any combination of lxe-employment benefit purchased is i 2% ittcmasc ar accntai. City Pension Fund for Firefighters end Police Officers in the City of Miarni Beach Page 35 PLA` PIiO~-i510NS TABLE YII 8. Cost-of-Llviag~kdjustment .Benefits ue increased by 2.5% per yt~, cornpaunded annually, each October ;after re6rentent, adjusted for partial years; merttbera whose grardfathered Base ?Tan benefit is greater titan the benefr[ otherwise provided by this plan will receive the appliceble cost- of-living adjusunent on that ba_vis (2% a ~reu L+eb~nning [hc Octo'ar;r three years after retiremcntj until sucia time as the benefit'so>ii this plan wits 2.5?/o cost-of-living exu:eds that comparable grandfathered Base P}a,~ beacfrt. City Pension Fund for F}refiyttters and Police Officers in the City of Ivtiami Beach Page 36 ,,: PLAT A1~IENDMF.NTS TABLE XITa The follo~Hirg amendments have been made: 1. Efective Septe:nl~r 30, 200fl, members of the post-t`L•ry l8, 1993 plan were merged into the pre-lvlay 19, 1993 benefit schedt:<e. 2. &ffectivc November 6; 2001, domestc partners of members registered with the City of htiami Beach are eatitled to survivor i5enefits under the Fund. 5. Effective Novctnber 8, 2001, members udth at least 7.0 years of sci•vtce and eligible to retire may purchase eerain prior public safety service or purchase an increased berefii. Fotat accrual from. purchase ofservice; includitsa, military time, cannot exceed 12"ro- 6, F,ffecfive November 5, 2003, tUe ttormal form will include l20 gnraranteed monthly payments, City Pension Fund for Firefighters and Police Officers in the City of Miami Beach oa9e 37 GR ~ Gabriel Border 5mic6 & Company 1 yJ coosatesnt~ ec Actuaries CITY OF' It11A~t1 I3F,.A(: N k;h1PI.UYEk:S' I2ETCREMF.IV`T I'I.Atk" REVISED ACTUARIAL VALUATION REPORT AS OF OCTOBER 1, 2007 ANNUM. EMPLOYER CUNTRII3UT10N FOR "CFCB F7SCAI. YEAR EVDIIJG SEPT~SI3ER 30, 2009 ,~ `~ v - i~;l }' ~ ~.' ~Rl ih fa: ['t3rAES;tri6' ` t~: i Nn . + t t4 ht• 3. '~ ~+.. •+_ f Y .t (`~..jj. .~ul• _ n.fu5 .c~. ~ t ~L,t ~F coc tit U~ August 13, 2008 Board of Trustees City of A4iami Beach Employees' Retirarncamt Flan \Qiami Beach, Florida Dear Board Members: We are plcvscd to prtscm omu Revised Cd:tobrs 1, 2007 Actuarial Valuation Report for the FhFn. "The purpose of the Report is to set forth requuad contn~bufion levels, to disekmse p}au assets aztd actuarial liabilities, to commeart on funding vrogress and: to provide supporting inforuttmtion regarding dme operation of the Plan. ThisRepirt is also dcsimod to comply with requirements of the State. The valuation was performed on the basis of enmployee, retirre and financial information supplied by Qui Cary. Although we did not audit this information, it was reviewed for rcawnablcncxis artd contparabitily to prior years. The benefit c~alued are artlimed at the end of the Report. Actuarial assumptions and the actuarial cost method am also described herein. Any changes in benefits, assumptions or methods are described irm the first sex:iion. As indicated below, the undersigned are Members of the American Acaderrry of Actuaries (M:1AA) and. meet the Qualification Staztdarde of the Academy of Actuaries to render tht: actuarial opinion herein. ~Ve will be pleased to answer any questiana penaining to the valuation and to ttteet with you to roview this Report. Respa tfimlly submittcxl, CiAl3R1EL, ROF.DER, SMITH r'1ND COMPANY J. tcpher Fahnquist, .45~ 1 ?4LAA.~, FCA Etv~lled Achmary No. 08-15~i0 BY r'!t1.~1Y1~~~__l.t121 LX~( Molissa R. Moskoviv, MA~AA P, C:A ~_. Enrollecl,0.ctuary No. 08-(r167 Statement by EuroDed Actuary TABLF. nF C.t)i\TT'F.R"I'S Seetion 't a Psee A Discussion of Valttation Resents I B Vaiuation Results C Pension Fund Information I . SlitiwtazY of Assets I9 2. Summary tifRund's lnconscnrrdlhsbeusemetiia 20 3. Actuarial \%a}ue of Assets 2 i A. Investment Rate of Return 22 D Financial Accounting In.°omratitm L F.4SB No. 35 23 2. GASB No. 25 24 E Miscellaneous Int~rmrnion 1. Rectmeiliationofil4emhershipData 26 2. Age and Service Distribution 27 3. Lttactivc~9cmbcrLhstribtnion 2R F Sttaunary• of Peon Pnn~sions 29 SECTION A DISCUSSION OF VAL,UA'I'ION RESULTS Comparison of Required Empl9ver Contributions The required employer contributiondcvetopcd in this year's actuarial valuation is as follows: Required City Contribution of Amount Payr6ll Govered_Payroll For FYF. 9!30;09 Based nn ]0/1/(17 Valuation $ 12,863,823 2L57 4io $ 59,632,425 Por FYE 9l30(OA $ase:et oa 10/1/06 Valuatiom 13,911,545 24.24 5'7,390,894 Increase (l~eeacetse) (1,04?,732) f2.67) ?,241,53.1 The contribution has been adjusted for in[etest on the bads that employer contrilwtions are merle in a single paytttent tut the first day of the fiscal year. The-total atxual eirmloytx umtribtiticm for the year ending September 30, 2067 was 513,053,231 compared to the mntimtatt required payment of $12,233,519 (from the February 2R, 2006 Actuarial Impact Statexnei[t). Revisions in Theac vtirto na rervitioas in hemefits since the previous valuatitm. (tevlsions in Actuarial Assumntious earl Methods The investment return assumption was rexiuced from 8.75% per year to 8.65% per year. "lhc imestmestt retum assumption will be furilrix reduced to 8S0% fcr the October 1, 2008 Valuation, 8.35% for the October 1, 2IX79 Valuation, 825% for lire October 1, 2010 Valuation, 8.1 S°h for the October I, ZOl 1 Valuation and k:00"/0 for the October 1, 2012 Valuatitat. Addiuemaily, the. acuaral vahte of assets was partially written up to the market valne of .assets as of Ouobcr I, 2007. The actuarial vahte of assets ltas risen fmm $395,369,083 to S4t2,824,235. TltemarketvalueofsssetsisS429,720,685. Actuarial Bxnerietaee There was a net actuarial. gain of 5[4,03ti,7t0 for the year winch means actual experience was more fetwrable than mcpa:tcd. The acmarisl fain was due [o imcshnent retunt on assets highex than the asaumcd retttm of 8.75°!o and average salary decreases for amtimting active participants. The aeAuarial gain translates ono a dexxease in employer contributive oqual to 3! ,33K,097 or 2.24% of covee2d payroll. GRS Yunded Ratio The fitnded ratio ibis year is 86.4;% compared to 79.g°lo last year. This year's ratio was 83.6% before the changes in ass~unptions and methods described above. The funded ratin is equal to tlrc actuarial vahte of assets divided hY the acritarial accrued (past service] liability. Analysis of Chatttte in Bmbtover Contribution The components of change in the required empiover coninlnttion are ag {ollows: Contribution rata last year 24.24 °io Change in assumprionslmethods (l.[R) Payment on wrfunded liability U.SG Change in emp4oycr normal cost 0.31 Ex p~riencc gairv7os (2.24} Change in administrative czpenae Contribution rate this year 21.57 The remainder of ibis Report inchidos detailed actuarial valuation results, financial information, miscellaneoue infrnmation and statistics, and a swnntary of p3att provisions. SECI70N B VALUAITONtiESULTS PARTICIPANT DATA October 1, 2007 October 1,.2006 <\CTIVE hfl~:i~ll3E-t6 Number 1,051 1,018 Covered,4imual Payroll $ 59,632,425 $ 57,390,894 Average Annual PayTOll $ 56,204 $ 56,376 Average Age 44:0 44:5 Average Pacc Service 8:6 8.9 Average Age at Hire 35.4 35.7 RETT1tEE5 & $F•.NP;FICTARtES NumF~er 959 950 Annual Benefits $ 25,397,555 $ 23,481,611 Average Annual Benefit $ 2b,483 $ 24,717 Average Age 70.5 70:5 DISASTI.T'i'X KIs71REES Numbs 42 45 Annual Brnefits $ 866,343 $ 871,466 Average Annual F3enefit $ 20,627 $ 19,366 Av~sagc Agc 56.9 67.I 'TERbTINA'I'ED V!';S'i'1SD D1Y.D16F.RC Nuwibcr 70 64 Annual B~cfits $ 1,048,560 $ 806,465 Average Mutual Bcmcfit $ t4,979 $ 12,601 Average Age 45.6 45.7 3 AN\iJAL REE~L!LRED CUNTRIBL`TION (ARC) A. Valuatiou Date October I, 2007 Uctobrr 1,'2007 Octabcr [, 200G AJier Changes BeforR Changes $. 1LRC to lic Paid Durittg Fiscal Year Pnding 9/30/2009 9/30/2009 9130!2008 C. AsaumadDateofEtnployerCoAtrib. IOIl%2008 101]/2008 10?E12007 D. ~nmtal Payment w Amortize tinfunded Actuarial Liability $ 4,806,312 $ 5,917,465 $ 6,421,333 E: Employer Normal Cost 7,033,373 G,83],804 6,370,392 F. ARC if Paid on the Valuation Date: D*E 11,839,690 12,749,269 12,792,225 G. ARC Adjusted far Frcquoncy of paytnems 12,SG3,823 13,SG4,829 i3 91:1,545 H. ARC as !'/o of Covered Payroll 21.5? ?i~ 23.25 °4~ ^_4.24 L Covered Payroll for Contnbntiou Year 59,G32,425 59,632,425 57,390,894 nc r[rAa1A1, vAL 17E 8F BENEFITS :l~'D :135ETS .4. Valuniirat Date October 1, 2007 UctuEer 1, 2607 October 1, ?006 AjtcrCliarrgr+s Bejoref:htatget B. Acttauial Ptcsem ValueofAll Projected Bcncfits far 1. AcuveMembers e. Service RetirementBenefi[x S 7,29,2]?,142 $ 225,279,191 S 22?;?>O,SIS b.~'estingBenefiis 21,754,022 21,2;9,82; 20;906;250 c. Disability Benefits 13:.14,69"1 13,Qi2,02k 12,924,5Sj d. PratetimmcntDcatbBcaftts 4;4517,978 4,333,801 4,254,244 o. RrturnofblembcrCwtttibutioax 730,23? 72911 605,825 ETotttl 269,369,106 264,0>54,15N 262,439,389 2. Itwctive itilomtiers a. Scrviu Refrr¢es & Beneficiaries 269,399,627. 267,1fi6,114 24j,380,N24 b. DisabilityRctiroes 8,679,742 k,570..034 8,530,17.8 c. Tetminatcd Vested Members 9,SOg662 9;368,428 7,86I,68t d.Total 2R7,540,?26 ?85,104,57K 261,772,833 3. Total for Ap Mcmbets 554,929.332 549,7SR,734 524,212.222 C: Actuarial Accrued (Past Service) lialslitypuGASBNo.25 478,067,829 472,756,431 448.933,278 D. Actuarial ValucofAccumntatedPlan BenefitsperFASBNo.35 432,296;456 427,839A80 395,731,353 b. Plan A~ 1. Market Value 424,720,685 429,720b85 378,035,98.5 2. Actuarial VaRte 412,824.235 395,369,083 35&458;949 F. Unfunded Actuarial Accrued [.lability C-E2 65',243,594 77,387,348 98474,329 G. Actuarial Prrseat Valuc ofPtvjected Covered Payroll 416,SSQ,l85 414,47S,U65 4U2,3U0,469 H. Actuarial Percent Va1uc ofProjccted Member Coniributione 32,09!,878 31,946,761 31,496,946 CA1,Ci11,AT10:V OF EMPLOYER VOR.'4IAL CUSI' A. Valuatieut Ihtte Cktober 1, 2007 gcmber 1, 2007 Uetobcr 7, 200G AfTer Changer. Before C$anges• B. Ncxttial Cost tur I. acrvice ReGrenterrt Benefits 3 8,352694 S 8,325,388 $ 1,99'.753 2. vesting 13enefits 1,177,556 1,149,979 1,088;041 3. DisabilityBeru:fics 972,110 959,31(3 92019 4. FteretircmcmDeath 8eaefits 287,367 253,?bS 267,09; 5. Return of Mcntfier Contributions 52 (,354 521,842 484,529 6. TatalfcxPuturei3enefits l1,447,di7 11,239,837 70,753w3y 7. Assumed Amotatt ftsr AdminisVateve Expenses 8. Tutal Nortoal Ca+t SJ9;,46 12,02:1,11; 579,706 13 819,543 519,005 t 172,247 °.bof Covered Payroll 2(1.16 °h 19.82'/0 79.(,5 ^.'~ C. FxpectedMemberContsiburion 4,987,734 4,957,739 4901,8`5 ~: 9'0 of Cowrod Payroll 8.36 % 8.3b 3'o ft.55 '-'~~, f ,. P. FmpleyerNormntCosc:138-C 7,03378 6,831,504 iE 6}709? ~. ^'o ofCo~•ered l?ayroll 11.79^h 11.4695 11.1[1 ~:,, -G~---- i,IQL'1DA'TION Or" "I'IIF. UYFl7h'DF.D ACI'GARIAI, ACCRLiED LL',BII.1'tY A. Derivation of the Current UAAL 1. Last Year's UAAL $ 90,474,329 ?. Last Year's EmploSzt Normal Ciut 6,647,002 3. Last Yeaz's Canuibutions 13,Ui3,231 4. interest ai the Asstmced Rate on: a, 1 and 2 for one year 8,498,116 b. 3 fives dates paid c -b 1,241,158 3SS958 7 . a , 5. This Yeats Faryrected LIAAL Prior to Revision: 1 + 2 . 3 + 4c 91; t24,058 6. Thix Years Actual U.AALPriorto Revisions 17,337,348 7. This Years Gain (Lois): S - 6 14,036,710 8. Change in UAAL Duch Plan Anwndments attd'or Changes in Actuarial Assumptions (12,143.754). 9. T?tis Years Revised U.ML: (~ + 8 65,243,594 10. Gain.(L:oxs) Due to InvcsuneaLS 11,652,377 f 1. Gain (Loss) Due So t>rlter Causes 2,384;333 " Based on Febntary 28,.2006 Actuarial Impact Statetnent B. U.4AL Amortization Period and Payments Uri 'nal L~AAL current UAAT. Date Amortization Period Years Fstahiished (Years) Amount Remaining Amount Payment 10/1!93 15 $ {3,006,333) . 1 $ (386,610) $ (386;610) l0;i/93 i5 5,324,154 1 683,579 684,679 10!1!93 15 2,587,206 1 332,711 332,711 I0/1/94 15 1,654,392 2 8DU,355 -015,773 101L'44 15 8;143,997 2 4,230,190 2 ?02,781 10/1!95 15 (3,893,388) 3 (2,436,702) (880;471) 10!1/96 15 (6,717,095) 4 (5,882,657) (1,658,409) lU.~li96 t5 (1,455,4$7) 4 (f,267,132) (357;224 10!1!97 15 (11,302,918) S (6,677;148) (1,555,653 10!1/98 15 (9,492,353) 6 (S;r79,597) (1,173,4S7 10/1199 15 (11,]97,305) 7 (7,300,008) (1,319,330 101!199 15 761,013 7 496,139 89.667 1011/00 15 (1,184,364) 8 (817,292) (1.34,145 10;1/Ol 15 4,182,294 9 2,989.100 452,375 10!1/01 15 8,482,719 9 6.062,522 917;529 10.'1/02 30 24,017;295 ZS 23,95S,39S 2,090,25b 1011/03 30 16,972,622 26 17,936,882 1,614,804 10!1104 30 9,682,Q48 27 9,456,665 887,131 ]011/05 30 9,377,578 2$ 9,331,333 823,502 LO!liOG 30 11,796,972 29 11,708;474 1,024,52 IU/1/06 30 .34,74.7,408 29 34,456,743 3,017,769 l0/1107 30 (14,035,710) 30 (14,036,710) (1,218,667) 10!1,`07 30 ~14,143,7i4) 30 (12,143,754) {1,054,321) 63,559,96] 65,243,594 4,806,312 C. Amortization Schctlulc The UAA[, is being liquidated as a Icwel dollar amount over the nttmber of years retnaiuing nt tLc azn~tization period. The expected aim~riizaiion xLcdulc is as Folluws' 2007 Y 65,243,594 2008 65;665,131 2009 66,808.450 :010 70,89f>,8! 1 2017 74,383,783 20 } 2 '75;979,055 207 7 6 1,199,468 2022 55,3x9,578 2027 37,407,904 2032 10,2x2;786. 2037 AC'['(;AR1AI. GAP.YS AND I.OSSBS Xear knded Gain (Loss) 9:3Q+1990 S (9,1t>G,524) 9130.+}991 2,'27,904 913Q'2992 4,954,823 9l3U+1993 5,370,894 9,'30+1994 (1,G9G,OGI1 9+'3011?+9S G,QGt,91R 9%?0/1996 '7,568,621 9130 7 1 9 97 91 1998 t3w39,264 894 790 6 30! . , 9l30tt999 16,168,137 9;30JZDU0 9l30l2D01 9f30l2002 6,54D.3UG (G,572,791} 58G (3Y 0G8) 9/30/2003 , , (18,414,901) 9+'3012004 (9,68?,048) 913o+'2DDS (7,uGO,o41) 9i3D•'20Db (1 f,79G,971) 9.+30r20D7 ]4.035.71D HISTORY OF INVF.ST:ltIIVT RETt}R'VS A~1H SALARY INCItF:AS><S 7 he fund earnings and salary increase assumptions have ctmsiderablc impact on the cost of the Plall so it is important that they nre consistent with the actual expetieace. The folWwitp; tab}cshnwathc actual fund earnings atld salary in[:rrasc rmescumpared to the assumcdrates for the L[stseveral years: Geaerd Ytan Uuelssail'icd t'.isa~~ InvesementRMaru Salsry incresaee lnvestmeal3tMUrn Sslsry Increases Year EadiaB Actail Asanmatt Actual Auumcd Atlue3 Asanmcil Actual Assuand 9l301I9S9 ! Lb % 8.U % f9 % 6.0 °io I4b ?'e 8.6 % 1.2 % 6.0 'h 9130/199(1 7.3 8.S T.5 6.0 (21) 3.0 12.3 b.0 9120.`[991 8:1 8.5 3.0 6A 2Lti 8.3 3.4 b.0 913tvt992 13,7 8.5 2.0 • b.0 5:8 9.0 2:4 6.0 9130.' 1993 1 L4 8S 3.1 6.0 14.1 9.U b.3 b.U 9!30/1994 6.8 8S 3.9 b.0 4.8 9.0 6.0 b.0 9/3(N199S 11 4 8.5 8.8 6.0 24a 9.0 7.b 6.U 9/3Q/I496 153 S.5 4.2 ti.0 13.9 9.6 8.fi 6.0 9!30+1997 13.8 8.S 6.0 6.0 19.1 9A 7:4 6.0 9!30lIM8 12.5 8.S S.U 6.U 4.3 9.0 4.1 8.0 9/30.11!199 14:4 8.5 7,3 8.0 I8.8 9.U 7a 6.U 9i3012CF0 10.7 8.S 6.T ti.0 ib.i 9.0 6.7 aS.O 9l.302IX?i 7.2 8:S 9.3 b.0 9.7 9.0 7.0 6.11 A30•'3007. 0.3 8.5 8.9 6.0 1.7 9.0 9.2 G.D 9i3Q~?003 4.3 B.S 8.1 6.0 4:6 9.0 T.5 8.0 9:3^•7tNSi 4.1 8.5 3.l 6.0 9.7 9.0 5.7 6.U 413(112005 4.4 8:5 Q7 6.0 10:7 9.0 6.8 6.0 9130r2ta;6 7.7 6S lt9 ti.U IU.2 8.T5 7,9 8.0 51302007 °f I2.0 8.75 (3.6) 6.0 NA NA NX MA Averages 9;2 % 5.3 % - t1A % - 6.6 % fApprax~rate rate `"' Represents salary increases and inv~estmetlt return for the total group Dote: Figures before i 992 were taken fiom Reprtxt9 of Buck Ccrosultants. The actual invesunent return rates stlowtt atmvc are 6ascd on U1e actuarial value of assets. 7'he acnlai salary intsa:ase rates shown ahove are dle increases rol>eivai by those active members who were includai in the actuarial valuation both at the beginning and the end of each period. The ellxibits that foUaw illustrate the ulble above in graphic form. tTistory ot'Investmeat Betas Aased on Actuarial Value of Assets - Geaerai Plan and Combined Plan After 2006 °~' {0. ~~ 4~~ O" C~~ A° >t\' 'qb ~~ c~°' n~ N 'N\ ~'L p'7 ~ ,N~ ~n ~p1 N' 9~ 9 9' q' Q' Q` 9' Q q q w 0. Q Q 9~ flan Ycar Eod -4°6 I5°/n 1095 34'0 9~ 9~4 a~ aA~ 0.~ U~~ ~ aq5 Q~1r 0.81 0.b qF{+ C~ 0.~` 0.,0'L q~> a~ qQ, gyJ6 0.~. Plan Rear End Compared to Previous Year History of Investment Return Rased nn Acfaarlal Valve of Assets -Unclassified Plan 25°/. 30% 20"/0 ,~q ~' ~. Pti ~~ A~ ,~' f5 ar q~ ~~ ~q `"° ,~. t~ti ~o; ,~} ~5 ,lo q a q a q'" a q q~ Q~ a, q~ a~ ~1 q A q a. n'N ~. Plan Yew Fnd History of Salary Increases -Unclassified Plan 16%v t 6s. 71°!v ~ - 12°io 8% 8°% a°,~ av° a°ro ~ -4°: a~q q'~ a~', q~ry a'P~' a~ a~' q~ ~'~ q'P~ Q~q o~ q~c` d°~ q~°~' aP' qA~' qab Plm fear End Compared to Previous Yesr Actual (A) Compared to Expected (P.) T)eccements Among Active Etnployees Namber Added Service & Active During DROP Disab ility T ertniuati ous D7embers Year Ye ar Retir ement Retire ment De ath Vesled Other To tals l:ndof Ended A !; A E A E A B A A A E fear 9!30!2003 109 46 iG 4fl 0 3 2 I IS 9 24 33 714 9130ri094 e5 54 24 3T 2 3 1 I f$ 9 27 35 7t5 9:30~20p5 73 62 I( 43 ? 3 2 I 23 I9 42 37 736. 9130(2006 • 3>', 73 4C 4U 0 3 I I 2i 13 34 39 1,078 9130:2007 P49 lOfi 40 $G ? 3 1 2 37 45 63 49 7,Ofi1 9130;2008 92 3 2 61 ~'iT 1<`:ais raI I t~:...._....._..~... "i; ~__ l3l -_._ 111'1 i I __..._._. _'3F _ F _ :? F 9:{ 1 U(~ 1vtl 191 • Tnctude~ 40ia transfers '• 'T'otals are tLtvugh current Flan Year orsly RECEi~'T iIIST[)12Y OF C[TN I"RIi31'TIO'.YS Vnlas[loa I Wbich~ Contribution Actual V oluefinn COIILrIbLLtiOL 10'1!92 4/30,'94 S 3,004SS6 $ 3,004,556 H)11193 9!30,'95 2;809,509 2,809;SU9 10/U94 9.!30/96 4.15(,807 4,1S1,R07 10.lU95 9!30.'97 3,982,477 3,982;477 ]01119b 4130198 3;091,35y 3,091.359 10/!!9? 10/1798 9130r'99 9130/00 1,293,920 bG6 897 1,293.920 666 897 10/1,'99 . 9130/01 , - , • 1011!00 9!30102 - - 1011/03 9130103 - - ]O71!U2 9130!04 2,476,702 2,476,702 1071103 9130!05 5,082,595 5,082,595 10!1/04 9l30r06 5,500,329 5,500,329 IO/1:'OS 9/30107 42,234,5!9 ° 13,053,231 10/1/U6 9730/08 13,931,.545 1VA 1011/C1? 9130!09 12,863,823 HA Recent Hiamry of)tequlred and Actual Cant1'iDntionF Total Fuca? Yewr i?n4 ACTTJARLIL ASSiIAfYTCONS AND COST METHOD A. Cost Alethvd 1. furuling Entry Age Achuvial Cost Method. 2. Accumulated Benef t Obligafion Acctued Benefit Method B. lnvestmettt Earnin~s• $:6S% par year, campoundct! aanu l6 C. Salary Increases" 6°io per year up to the assttrried retirement age. D. Inflation 4% per year: E. Retirement Age See Table helow.ivr rates of retirement. F: Turnover Rates See Tablebelow: G. Mottatity Rates iy~t 6iroup Atutuity Modality Tables for males and females; for !hose who have terminated employment hefvrc IOl1l93, rates are based on the group's own exprricttca; see 'I'ablc below. Fi. Disability 1. Rates See Tabie below. 2. Percent Service Connected SO% 3. Mortality Regular. rates sec ahead five years. L Asset Value The actuarial value of assets was partially written up to the atarkct vahte of asses as of (ktvba 1, 2007. Going forward, the actuarial value of assets wilt, be based on the dif€erence between the :actual and expected return recognized over 5 years; sea later papa for details.. 7. Admittiatrative Expenses Non-investtnatt related expenses era assutuod to be the outrage of such expenses over the last two years. K. Increase in Cocerad Payroll NA T... Cost o£Litivtg h>crease 2.5%per year. M. Changes Since: Last Valuation '['hc investment return asstutiption was reduced from 8:75;0 per year to $.6S°,~o per ,year. The actuarial vatuc of assets wss paRiaity fresh-started to $~f12,$.4,233. r e ....a..,r:..,.:..a..r.,.., GRS Anunnf Rate of 3Mortafity Rctircutent* A e lYfafe ~eauale Turnover f)fsabilit7. Group A Group B 25 O.OS% 0.03% 14.6°/u 0.07% NA NA 30 0.06 0:03 7.8 0.08 NA NA 35 0.09 DA5 5:7 0:13 Net NA 40 0.12 0:07 4.7 0.20 NA NA 45 0.~ 0.10 3.3 U,3I NA NA SO 0.39 0.16 2.] 0:46 30.0% S.0% SS 0.61 0.25 1.1 0:64 12:0 5.0 60 0.92 0.42 0.4 9.04 .20.0 60.0 65 70 1.Sti 2.75 0:91 1.2d NA NA NA NA ]00.0 NA 100.0 NA 75 4.46 2.40 NA NA NA NA 80 7,41 4.29 NA NA NA NA 8S I1.48 b.99 NA NA NA NA 90 I6,63 I1.I8 NA NA NA NA 95 23.41 18.24 NA NA NA IVA 100 31.92 29:52 NA 1~tA NA NA • For those eligible to retire, GLOSSARY (lE' TERM5 SF.CTIONi C F$tiSI02V FGTiD IlV'FORMATiON SUMi11.ARY OF ASSETS 9/3IIf2007 9/30/2006 Cash and Securities -Market Value Cash and Equivaletus $ 6,360,027 S 6,624;539 Treasury and .lgcncy k3ciads & Notes 13,495,275 19,130,130 Corporate Bonds 26,606;172 37,278,261 Common Stocks S1,G70;353 43_,342,562 Domestic Equity Funds 196,496,047 172,495,867 Domestic Bond Furtd¢ 90,745,990 64,550,49? State of Israel Bond 250,000 210,000 international Equity Fuads 43,955;256 31,655,432 Tatsl 429,179,120 375,327,258 Reeeivahles and Accrustr State Cotitrtbution bfember Con rib ti - t u on Employer Contribution - 209,672 - - Interestand Dividends 533,599 491:916 Other 313,734 3,546,066 Total 1;05?,005 4,p37,982 Payables i3enelits - Rsfiutds Expenses - 18,311 - Other 437,129 1.,329,285 Total 515,4•t0 1,329,285 Net Assete - A4arket Value 429,%20,685 3?8,035,985 ' Keceived from 401 A Plan transfers after 9130%05 FENSION FUND IlVC~17E AND DISBURSF:ASRl1iTS Year Rnding 9130!2007 Year It;ndiag ji 9l3pl2U06 is Marizet Vahte at Bcginaing of Period S 378,035,985 $ 345,845,205 Income :~1c-rnberContribulioru 7,9^7,173 .24,406,697 ' fmployerCaniributions }3,0.13,231 5,500,329 T,ihr~ary/McKm Dadc Contributions 1 1,146 4,660 Investments -Interest and Dividends 5,559,442 4,298,634 Investments -Gains (Losses) 52.758,436 21,667;566 'Total Investment EaminBs 58,317,878 25,966;200 Total income Di b t 79,309,428 55;677,886 ~ s ursemen s MonthlyBene82Paymeats 25,589,393 23,105,121 Lump Swn Distributions 0 0 Refund of Cotttribntions 611,742 309,286. InvestmcntRe]atedHxpenses 781,776 75,105 Other Administrative Expeases 541,817 517,594 lnsurancx E'rurniumS U U Transfers to ()thcr Systcros D 0 "Total Disbur~ncnts 27,624,728 24,587,106 Net Inereue Daring Period 51,684,700 31,190,780 i4IarYet Valae at End of Period 424,720,685 378,03S,98S $ 4,415,806 rcgulazcontributions 1,037,494 buy-back contn"butinns 18,916,736 "migtotion" contributions 36.611 probation buy-backs 24,406,697 AC'f[iARTAT, VAI,GF, nFA„SSF,'T'S Year. Ending Se rember 30 2007 2006 A. BegicuriagofYearAssets 1. Market Value $ 378,03,985 S 34b,845,203 2. Actuarial Value 358,458,949 325,7:7,087 B. Net of Contributions LessDisbursemeats' (5,851,402) (13,974,595} C. ActualNer}nvestmem Famings' 57,536,102 25,2.11,097 D. Expccredlncestrnent Earnings' 31.1Q9,1S9 27,314,07 E. ExcessofActualOver Fxpectcd lnvcstnteut Earnings: C,-D ?6,426,943 (2,102,976) F. Rec:ognidvnofExcess Fernings Over 5 Years 1. FromTlus Yenr 3,2R5,3Fi9 (420,595) 2. Fmm (hie Year Ago (420,595) ?,616,059 3.Fn~mTwoYcarsAgo 2,616,059 1,431,635 4. FromTluu Years Ago 1,431;635 2,739,889 5. Prom Four Years Ago 2,739;889 ' (6,928,834) 6. Total 11,692,397 (Sb1,896) Cr. 401APIanTra»sfers NA 19,954,280 H. End ofYcarAssets (Before Re~~sion) 1. Market Value 429,120;b65 378,035,985 2. Actuarial Value: A2 + II + n + P6 + G 395,369,083 358,458,949 3. Final Actuarial Value Within RO°!° to 120% of Mazket Value 395,369,083 358,458,949 I. Partial Write tJp 17;455,152 bLA J. End of Yehu Assets After WTitetlp 4!2,824,235 NA "Net of lm~estnxnt Related I:apenses ~~ SNVEST~YEIr'1' RATE OE RETliR1Q General Plan ** tinclasslfied Plan ~~CHY P.nded Market V aloe Actuarial VA11 Market Value Actuarial Ve 4.'3039 NA ?~0 11.6 % 14,6 4~0 14:6 °!o 9;30;90 NA 7.3 (2:3) (23} 4.30191 NA 8•I 21:6 ZLb 9!;0:'92 12.2 23.7 5.8 S:8 9,30/93 14.6 t 3.4 14.6 14.1 91.30194 14 6,8 53 4.8 9130%95 20.0 11.4 25.9 24.1 9:30%96 9.S 15.3 22.7 13.9 9~3U197 23.0 13:8 35.2 19.1 9/30x98 8.4 12.5 (0.3} 4:3 4130199 13:1 14.4 19.1 18:8 91301(10 10.8 30.7 17.5 16.5 9130/01 (7.4) 7.~ (8:1) 9:7 9;30102 (5.9) 0:3 (9:8) 1.7 9130103 17.4 4.3 16:9 4.5 9/30104 11.4 4.1 13.0 9.7 9/30J05 12.5 4.4 li:8 10.7 9/3006 7.4 + 7.7; 7S ' 10.2 k 9130!07 1S3 12.0 NA NA Avenge C'ampouodal Rato of Rewm for Number of Ymn Stwwn 10.0 °10 9.2 % 10.9 % I1.0 % Avtngc Rxnt+oundpl Rate of Ra:nn for Last s Years 12.8 % G.5 °'o NA NA Note: effective IQl1/06, the fom~ec' General and Unclassified Plans were tner8ed and assets were combined. Investment reruns a ier tivs date are for the total goup. °• Combined Plan after 2006 SECTION D FIlVANGiAi. ACCOUNTING L+fFORMATION FA$B N0.35INFORIVJF.TTON A. Valuation Date October 1, 2007 October 1, 2006 B. Actuarial Present Value of Accumulated Plan Bctteftts i. Vested Benefits a. htembcrs Currently Receiving Payments 5 27$,039,364 $ ?53,910,952 b. Terminated Vested Members 9500,862 7,861,881 c. Other Members 138,395,$83 125,486,269 d. Total 425,936,1.09 390,259,102 2. Non-Vested Benefits 6,360,341 5,472;251 3. 't'otal Aahuuial Yresent Value of Accumulated Plan Benefits: ld + 2 432,Z9b,450 395,731,353 4. Accumulated Contributions of Actiee btembers 50,696,622. 48,659,416 C. Changes in the Actuarial Ptesent Value of Accumulated Plan Benefits 1. Total Value at Beginning of Year 395,731,353 332,038,247 2: Inetrase (Decrease} During the Period Attributable to: a. Plan Amendment 0 41,085,601 b. Change in Actuarial Assumptions. .4;457,370 0 c. Latest 9iember Data, Benefus.4ccuwulated and Decrease in the Miscount Period 58,308,862 46,021,912 d. BcnutilsYaid (26,20],135) (23,414,407) ' e. Nei Increase 36,565,097 63,693,106 3. Total Value at EnclofYeriod 432,296,450 395,731,353 D. Maticet Value of Assets 429,720,685 378,035.985 E. Actuarial ;\ssuiuotions - 5ce page rniillcr: >lciwtr.s; :lsvunipiio,u ;~.ad .'.'~, :Mind=. -------'~ ----~----._ ................ 1...................... ... __~ ." ~ O O o v] v] '~fJ U v, x x •T l~ V' C ~~ OG. n C'] Oi V d ~ Y "~ V v v v v~ O i. ,~.v ._ Q. vv ^xP O] ~i `O O t~l e} Q M V]' 7 oxa+q c h o0 ~O v. O O\ O h C ac a:~ri 00 m ^. JY. ~n V] niN .v~ M O y O P~ ~--~ P N N. N N CI O K x ~6O M N N tl fJ M 'S '.Q '~D M tri -M ~. ~? '~1 .O ~C Vl h U o ! 6i ~ N h !~ O [P ~ ~. C O O 50 A `D GC 7`•. O .Ii [`- 7 p .-. V1 P m LET O. 0~0 0~0 n ~ er ~ ~ v ~ p v W .-. .-. .-. .--. .-. .. .~ ,~ o~~~_.-. ee~~ ~ N ~ b M~~mK h h h .--~ P N ao NmNOrn M O N N N (~ C1 M O] M xv V a M Y] wi v ~ ~p ~ = a W. ..~ r N G G oo 'V O V o T V Ml .--~ M V O dJ h N nl .D 'P 4'] x h K G1 x 00 N M' O a U .O 7 h .D V^ N h x (+'_ K. f 'tt i m O {~ M c+C -S M Ci v ~i. ... v N r V 7 v v v v w.. M 7 v i i O `~ T 4/ r a ~ O Lsi 'iii N V~ h '~f N .O. ~ .o ]o M O [^. ~~tl{{' O M M W d N f'- N U V1 00 N t~ v] N x P ~! O rl O N ~ b M O O OD O] G\ x O _h O x h N Q V' A vt C•j ~ O U M .-~ p. [~ N 7 ~o vii ~ a ~ >Q„ ~ i. p~ .-+ O o:'. N >o ~ O N N K. ~ N N N ~~! M [r +.{ C. (hr' m ~ `O [~ PP~+ N N N N •h M P - O N C. M h ~ ~ ~ t7 M Mi M~ [~ ~J0 h 1`- V K'. ~ a a 'a' 4, R ~~ gg_ ~ ~. t'~ h M ... N pQ~ ( M h A O+ x ~C .--. .O tl' .fin V -% 7 N 00 i+ M 00 O O N M N M '/1 T 7 :.o V1 M. N O h 'O h h v1 C m x N N O] 'S a N M x ff ~ T~ ~ 00 oC O N h •^ ~^ f`I N N ~ N M M M M i . N V M M M M M O ] M tl' u C w P .~ °c.. ,a o y •~ v P c a a a ~T O. P P O~ op Gx`•. C~ 0 0 0 O~ O] O 0 0 pp eett G O b 0 0 O G O O G 0 0 O ~ q G ,''=yn _ o oooc ~--~ N N N oc3ooo fV N N f`l N o %~ ~ `3 0 0 ^ g ~~~cc .s G.> U y N ~ Q Q,~. G" SCHEDULE OF' ]~f R1,pYER CONTRIBUTIONS (G.AS$ Statement \o. 25~ Yettr Ended Se tember30 Annattl Acquired Contrii~ution Actual .Contribution Percenta~r Conixibutei] i 1994 S 3,004,556 $ :5,00.,558 100.0 °. li 1995 2,509,509 .2.509,509 100.0 1996 4,151,807 4,151,807 ItxL0 2997 3,982,477 3,982,477 160.0 F998 3,091,359 3,091,359 IOU,0 f 1999 1 93920 1,293,920 ]00.0 2000 666,49.7 666,897 100.0 2001 0 Q NA 2002 0 0 NA ?W3 0 0 NA 2004 2,476,702 2,376,702 Ino.6 2005 5,082.595 5,082;545 1(10.0 2006 5,500,329 5,504,329 IO0.0 2007 ]2,234,519 ' 13,053,23] 106.7 • Fmm gel~zuary 28, 200b Actuarial Iropacz Statement src~r~or M7SCFd.L,ANrOIJS 111iF~R3NA'TTOAf RECONCILIATION OF ASE~181;K5EEEY DATA Frum 10;1/06 Front 1U.1lO5 Tu 1011107 To 1011!06 A. ActivE Yletnbera 1. Numbc: Btctudcd in Last Valuation 1.OIR 736 2. New• lvlembcts lnulutled is ('arrest Valuation 149 82 3. Employ[ttettt Terminations (55) (2R) 4. Scrvic:c Rutinsnc:ats (4D) (42) 5. Disabili[y RetiPen[ents (2) ~ 6. Deaths (1) (() 7. Other -Transfers (hit and Data Ad}usunenu (8) (4) R. 401.4 Transfers NIA 275 9. Number Encluded in This Valuation 4,061 1,018 B. 'Terminated Vested!19etnhers 1. Number Inclnded to Last Valustioa 64 64 2. AdditiorLSfromActnchlcntbess 17 4 3. Lump Sum Paymants~Refimd oft:oatribtuioes (4) (1) ~. Paynunta Cornmeueed (4) (3) 5. I>eatkt¢ 0 D 6. Other - Dana Adjustments (3) 0 7. Number Inchedcd in This Valuation 70 h4 C. Sero~ire Retirees, Disahfifty Retireca and Beneficiaries 1. Ntmtbcrhtchule~i in Last Valuation 995 9?B 2. Additions fmm Acti~z Members 42 42 3. Additions from Terminated Vestedldembets 4 } 4. Deaths Resulting hi No E~unhcr Pa}atcnts (4ti) (29) 5. Ih•aths Rcsvltiny is Ncw Survivor 13cne5ts 2 1 6. End of CerfalR Period - No Furtltor Payments (1) 0 ?. Odor -- lump Swn. Distributiuar 'il i V i ft N b I l d d i h 0 7 0 9 . s tat um er nc u e r. t a on t,(N l 95 z? NTAMi BEACH EM1ff'F.OY£ES' RF.TTRETfE~T PL:1TG - ACTI''•'fi ]-£I;?Yf$ERS ON OCT'n$ER 1, 2007 2U-24 33 Tota11'ay IA9O,581 Avg Pxy 31;159 2.i-29 63 ]0 ;5 ToW PaY 2,334,909 393,153 2,728,66'? Avg Pxy 35,92? 39,175 36;82 30.34 55 33 6 lOa 'total Pxy ?,793,358 1,51 I,1RO 247,846 4,652,984 Avg Pxy 43,475 48,842 41,308 44,'40 33-34 6l 49 29 2 141 Total Pxy 2,843,354 ?,635,U8Y 1;728.(052 130,262 7;3$7,757 Avg 3'av 46,613 54.206 39;588 65,F31 52,783 4P44 49 52 46 ZS 6 1 179 Total Pay 2,630,398 1.,948,300 2,484:171 1598,561 354,623 54:427 IA),231.,3RO Avg Pay 53.682 56,702 58,355 63;145 59,104 54;427 $7,270 45A9 6l 54 39 ?I 26 I9 220 7otal.PaY 3,22O,7ti5 2,854,828 2.335.828 1,260,134 2,023,002 1,435;154 13329;661. Avg Pay 52,198 32,Rci7 34,893 60,006 77,808 ?5;535 59,630 30.34 22 31 3i 11 i7 6 118 'total Pay I,t}565O6. !,531,033 1y878,242 725,345 1;34$,554 373;154 6,924.1044 Avg Pay 48,0? 5Q,O33 59,588 65,940 79,151 62,192 58,?7.T 55-59 >5 2l 30 7 13 2 98 Total PaY 1,469;597 1,226,542 2;417,056 578,681 841,027 83;908 6,621,921 Avg Pxy 5$,738 33,407 805b9 SZ,569 64,644 44;454 67,571 GO.64 14 l6 [6 13 4 3 56 Tow! Pxy 623,685 715,7792 979,996 895,478 242,p42 251,267 3,674 560 Avg Pay 44,692 44,643 67,250 68.883. 53A1d 83,755 55,751 65-99 4 A 9 '1 1 23 Total Pxy 237,662 132.~V2 546,758 436.982. 704,499 1,453,198 Avg Pay 58,166 33,076 60,751 62;4).6 1O4A94 SS;1?R 1NAC1'SVE SSE>11B£RS ON OC:'1'08ER1, 2007 Terminated VcSted Dlaabitd Retiree & Beneticinrie frand.Tomf Annuxl wetwal Annual Annaat Age No. Benefits Fo, BtaeRts No. Beaefits Nn. fleoefits. UnAer4S 27 S 292,968 I S 2%,U06 7 $ 104,342 35 S 424,316 45/9 33 668,390 3 X2,24fi 8 409,490 44 1,133,126 50-54 7 46_.^~il 5 IOb,U44 66 2,?97,258 78 2,949,513'.' 55-59 7 4?,991 5 IOR,823 !33 4,985,3?4 141 5,137,188 i 60.64 0 7 2t?,49U !26 4770,738 133 4$8?,273' b5.69 0 2 52.269 ii7 3,116.?07 lI9 3,Ih3,576 70.74 0 5 7b.442 142 7,268,027 147 3,344,469 ~S'9 U - 4 5?,440 d3) 2,G4G,313 l35 2,697,753 80-84 t) - 7 113,b16 ll4 2,142;55% ill ?,<^^50203 R5-89 (1 - 3 35;1:1', 82 1.203,748 RS 7,239,685 9Q Pc tip U 33 353,371. 33 353,321: 7otai 70 5 1,048,560 42 S 866,343 _ 959 S 25 797.575 1,071 S 27312,473 i 5ECfION F SUMh1a1RY Of PLAN PR()VFSI[fALS ~.?i47 k:ffective Date SUMfi3:~Kl' Ob' PL..A'V PRC~75InNS Otie-twelfth of average annual F:amings durittg the two highest paid years of Creditable Service, not Icss than the average motttbly earnings far the IZ tnottths prior to the effectne date for Unclassified Tier A members Normal Retirement F,Ilgibility Age 50 and five years of Creditable Service for those in Tier A. Age 55 and five years of Creditable Service for tha¢e in'ficr H Benefit 3°k of FAME tnultipliod y~rs of C:rcditablc Servtice with the total not to exceed 80",~0 of FA~~1i:. There is a 90%a Cap fat certain Tier A members. Form of Benefit 50% joint and survtvor annuity payable only to the spouse or, if no spouse, to the survildttg children until age 21; other options arc also available. Spousds batefits erase upcm rctnarriage. Far Re+ire:rent For a member motto has at least three years of Creditable Service but whn dies before commencement of re~iremeut benefits. a montlily beatefit is lxtyable tv the spouse vr, if no spouse, to the children until Este 21. The benefit is equal to 5(T% of the accrued nomtal retirement benefit without rccluction with the result being a mittimturt of 3Il% of 1'AMti anti a max.mum of 40% of FA.~fE for Cicneral mcinbeas. Any member wtiv terminates employment and does not request a rcfimd of his vwv contributions and has cvmple;ted at least five years of C.reditahle Service will be eligible to receive his accrued bmofit upon reaching his normal re:tvement age. Past -Retirement Adinstments Retires receive a 2.54~o increase each year. C.orrtributions Tier A 11~Iembers 10°{0 ~f F.amings. Ter B Members 8°l0 of Pamings. Employees who have reached tltc app}icsble benefit accnial cap (90°~o for General Tier A employtics and 22(t°io for all oiliers) but have not yet reached retirement age wilt continue: to contribute to the. pcmion Plan, but only on tiu; amount ly which pay increases after reaciuq~ the cap From the fib' The arnouni nceessary to fund the Plan properly axording'to the Plansactuary. Cibanaes Stiace Last Vataatioe Pone ~r~. ~~;~~ ~ City Pensit>n i'undJor,Nircf~hters and Nulice U~}`ire;, •~~ ~.~~ .~ ^,rc~:,:;z~ in the Crg~ of;tficrmi Beacfr °~,:. r, PENSION PLAN INVESTMENT POLICY Adopted - Aergust 31, 2l?08 EfFective -November 1, 2008 Investment Policy ................................ .. ........ Section A Investment Policy Guidelines •••••••••••••••••••••••••• ••~~••~ Section 8 Investment Policy - UROP Accounfs • • • • • • - • • ~ • • - • ~ • • • - Section C 1691 hiirhiuus:lvexue • Suite ii5 ~ Stiwni&rach, P'foridc.?3l.t9~5"~ rj4S) 6%3-?434 CITY PENSION FUND FOR FIREFIGHTERS AND POLICE OFFICERS IN THE CITY OF MlAM! BEACH INVESTMENT POLICY DATED MARCH 20, 2008 INVESTMENT POLICY EFFECTIVE MAY 1, 2008 Name of Plan: City Pension Fund for Firefighters and Police Officers in the Clty of AAiaml Beach Plan Sponsor: Clty of Miami Beach, Florida Current Bvard of Trustees; Police Department Fire Department Samuel Bejar Sidney W. Reese, Ili Gregory S. Butler Charles E. Albury Dale A. Twist donald R. Sapp, Jr. Admtnlstratipn Lynn W. Bemsiein Kathio G. Brooks Debora J. Turner Executive Director: Celia B. Locke, CEBS Custodian: Fiduciary Trust Internationat Money Managers: lm~erness Counsel, lnc. Rhumbline Advisers WeNington Management Company, t_LP Wenthworth, Hauser ana ~/io(ich, Investment Counsel Logan Capital Management, Inc. Voyageur Asset tvtanagement Inc JPPotdrgan Asset Management finestment Consultant: Thistle Asset Consulting Actuary: Buck Consultants, an ACS Company Accountant: Goldstein Schechter Koch, CPA Legal Counsel: Cypen & Cypen (1) SCOPE The investment Policy sha11 apply to all funds under control of the Boarci. Detailed gutdalines are attached to and made a part of Phis investment Policy Statement. Al (2) INVESTMENT O$JECTiVES 1, To obtain a reasonable, total rate of return -defined as income plus realized and unrealized capital gaihs and fosses -commensurate with the Pnrdent Person Rule. 2. To obtain reasonable consistency of .returns on a year-to-year basis, with concern for loss of capital being paramount. 3. To have the ability to pay atI benefit and expense obligations when due. 4. To maintain sufficient funding for (a) unexpected developments, (b) possible fdtute increases in benefits andlor (c} reduction in expected rekums on investment. or interest rate assumptions. (3) PERFORfrAANCE MEASUREMENT The Board has specified performance measures as are appropriate for the nature and size of the assets within the t3aard's custody. Those performance measures are set forth in the {hterna! Controls section of this Investment Policy. (4} INVESTMENT AND FUDIGIARY STANDARDS (5) The attached Investment Guidollnes list investments auttwrrzed by the Board. investments not so listed are prohibited. ff on October 1, 2000 investments exceed the applicable limit or do not satisfy the appllcabie investment standard, such excess or noncompliant irn~estment may be continued until it is economically feasible to dispose of such investment, bu! no additional investment may be made. (6) MATURITY AND liQtilDlTY REQUIREMENTS The investment portfolio is structured in such a manner as to provide sufficient liquidity to pay obligations as they cwite due. To that end, the Hoard has attemptP.d to match investment maturities with known cash needs and anticipated cash-flrnv requirements. a2 (7) PORTFOtlO COMPOSITION (8) RISK AND DIVERSIFICATION Investments ~ from over (9) EXPECTED ANNUAL RATE OF RETURN All assets shall be held by a third party, and all securities purchased by, and all ccllaterai obtained by, the Board stall be properly desgnated as an asset of the Plan. No evithdrawal of assets, in whole or in .part, shall be made except upon authorization by the Board. Securities transactions behveen abroker-dealer and the Custodian involving purchase or sale of securities by transfer of nroney or securities must be made on a "dekvery vs. payment" basis to ensure that the Custodian will have the security or money, as appropriate, in hand at the conclusion of the transaction. A3 (10) THIRD-PARTY CUSTODIAL AGREEMENTS (11j MASTER REPURCHASE ACaREEMENT All approved institutions and dealers transacting repurchase agreements shalt execute and perform as stated in the Master Repurchase Agreement. All repurchase agreement transactions shall adhere to requirements of the Master Repurchase Agreement, This provision does not restrict or limit the terms of any such IVtaster Repurchase Agreement. (12) BID REQUIREMENT The Board shall determine the approximate. maturity date based on cash-flow needs and market condftions. analyze and select one or more optimal types of investment and competitivety bid the security in question when feasible and appropriate. Excerpt. as otfierwise required by law, the most economically advantageous bid must be selected. (13) INTERNAL CONTROLS The attached system of internal contmis and operaGonat procedures has been .adopted by the Board and shall be reviewed by its Independent certified public accountants as part of any financial audit of the Pian. M addition, the Board has adopted the following infernal controts'with reference to selection and review of Money Managers: A. 5etection of Money Managers. The Board, wish assistance from the Investment Consultant, has selected, and wilt select, appropriate Money Managers to manage Plan assets. Managers must meet the following minimum Criteria: 1. Be a bank, insurance company, investment management company or investment adviser, as defined by the Investment Advisers Act of 1940. 2. Provide historical quarterly performance numbers, calculated on atime-weighted basis, based on a composite of fully drscrotionary accounts of similar Investment style, reported nehand gross offees. 3. Provide detailed information on the history 9f the firm, key personnel, key clients, fee schedule and support personnel. 4. Clearly articulate the investment strategy-that will be followed and document that the strategy has been successfulty adhered to over time. B. Duties and Responsibilities of Money Managers. The duties and responsibilities of each Money Polanager retained by the Board include: t. Managing Plan assets under its care, custody and/or control ih accordance with this Investment Policy or in accordance with separate written agreements when modification is deemed prudent and desirable by the Board. A4 2. Exerdsing investment discretion (including holding cash equivalents as an alternative) within the objectives and guidelines set forth in this Investment Policy. 3. Promptly informing fhe Board In writing regarding al! sign~camt and/or maierlal matters and changes pertaining Eo the investment of Pian assets, imcluding, but not Limited to: 5. utilizing the same care, skill, prudence and due dligenco under the circumstances then preva@ing that experienced investment professionals acting in a like capacity and fully familiar with such manors would use like activities for like retirement plans with like aims in accordance with all applicable haws, noes and regulations from local, state, federal and international politics! eMlHes as they may pertain to fiduciary duties and responsibilities. 6. Acknowledging and agreeing in writing to their fiduciary responsibility fully to comply wRh this entire Investment Policy, as same may ba modiried from time to time. C. Monitoring of Money Managers. Gluarteriy performance wilt be evaluated to test progress toward the attainment of long-term targets. The Board understands that there may be short-term periods during which performanco deviates from market Indices. During such periods, greater emphasis shall be placed on peer performance comparison vnth managers employing similar'styles. From time to time, but no less than quarterly, the Board will meet to focus on 1. Manager's adherenceto this Investment Policy. 2. Material changes in the Manager's organization, investment philosophy and/or personnel. 3. Comparisons of Manager's results to appropriate indices, specifically the S&P 500 index for Inverness equities, the S&P 400 index for Rhumbline, the Russell '2000 index for LVeiling`.on, the tv1SCl EAFE index for Wenthworth, Hauser and A5 Violich, and a 50!50 blend of the Lehman Brothers GovemmenUCredit and Governmentr'Credft Intermediate indexes for Inverness fixed income. 4. The risk assoaated with each Manager's portfoNo, as measured by variability of quarterly returns (standard deviation), which should not exceed that of the benchmark index without a corresponding increase in performance above the benchmark index. to addition, the Board will focrrs on: 1. The Manager's performance relative to managers of tike investment style or strategy: Each manager is expected io perform in the upper half of tts respective style universe. 2. The Plan's investment performance results compared to the Manager's overall cdanposite performance figures to determine unaccounted for dispersion between. the Manager's reported results and the Plan's results. The Manager shalt provide compcsite data if requested. of Morley Managers is as 1. A Manager performs in the bottom quartlie of its peer group over two consecutive quarters or over an annual peritxi. 2. A Manager falls in the "southeast quadrant' of the dsklreturn scattergram for a three or five-year period. 3. Further, a Manager may be replaced at anytime and for any reason, including but not limited to the following:. 1. A Manager consistentry performs below the median of its peer group over rolling three-year periods. 2. A Manager,has.a.COnsistentiV nanath~a.alnha nvce rnllinn4hrnn_vnarrwr:nrlo The following events also warrant immediate review of the Manager. 1. Changes in professional staff. 2. Significant toss of business. 3. Significant increase in business. 4. Change in ownership and/or control. A6 (14) CONTINUING EDUCATION Ail Board members are encouraged and expected to attend continuing education seminars concsminy matters related to investments and responsibilities of Board members. Without limiting the foregoing, Board members are pre~uthorized to attend certain conferences Meld within fhe spate of Florida. {15) REPORTING The Boani shalt sutxnit an annual report to the City of Rdiami Beach. The report shall include investments in the portfolio by Bass or type, income earned and market value. The annual report shall be available to the public. (16) FILING OF INVESTMENT POLICY Upon atloption by the Board, this Investment Policy shall be promptly filed with the Florida Department of Management Services, the City of Mlami t3eaeh and fhe Actuary: The effective date of this Investment Policy, and any amendment hereto, Shad be 31`r calendar day following the filing date with the City. (17) VALUATION OF tLLIQUlD INVESTMENTS Investments and assets for which a generaly recognized market is not available or for which there is no consistent or generally accepted pricing mechanism are prohibited. A7 THE Cmr PENSION FUND FOR FIREFIGHTERS AND POLICE OFFICERS IN THE CITY OF MIAMI BEACH INVESTMENT POLICY GUIDELINES ADOPTED MARCH 24, 2008 EFFECTIVE MAY 1, 2048 I. FOR ALL INVESTMENT MANAGERS Pu__rpose of Investment Policv Statement The Pension Board Trustees mainta(n 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 statement of Investment Policy. to fulfilling their fiduciary respons(bility, the Trustees recognize that the retirement system is an essential vehicle &x providing income benefits to refired participants or their beneticiarfes. Tho Board also recognizes that the obligations of the Fund are long-term and that investment policy should be made with a view toward. performar+.ce and return over a number of years. The genera! investment objective, fhen, is to obtain a reasonable total rate of return -defined as interest and dividend income plus realized and unrealized capita! gains. or tosses -commensurate with fhe Prudent Investor Pule and any other applicable statute. A reasonably consistent and adequate return, protection of the assets against the inroads of inflatbn and safety of the assets are paramount. However, fhe volatility of interest rates and securities markets make it necessary in judgo results within the context of several years rather than over short periods of one or two years or less. Performance will be measured quarterly. I. INVESTMENT PERFORpAANCE 08JECTNES -QUARTERLY EVALUATION A. Tfie Tatal Fund B. Total Equity Portfolio Beginning April 1, 2007, the .performance of the total equity portfolio will be compared to The return of a portfolio comprised of 47% S&P50D, i6% R2000, 15% S&P400, 6% R1000G, 6% R1000V & 10% EAFE. t3eginring July 1, 2007, the performance of the total equity portfolio will be compared to the return of a portfolio comprised of 50% S&P500, 13% R2000, 12% S&P400, 5% R1000G, 5% R1000V, 8% EAFE & 7% NCREIF. C, Total Fixed income Portfolto Beginning April 1, 2007, the perfommance of the total fixed income portfolio will be compared to the return of a portfolio comprised of 50% LBGC and 50% LBIGC. D, For Inverness Counsel The below listed performance :measures will be used as objective criteria for evaluating effectiveness of the investment manager. Total Fund Performance 1. The performance of the total fund will be measured each quarter .for roEling three and five year periods. These periods are considered sufficient to accommodate the market cycles experienced with investrnents. Beginning April 1, 2007, the performance of the portfolio will be compared to the return of a portfolio comprised of 32% 5&PStlO Index, 31 % of the LBGC Index, 31% LBIGC & 6% TBifl. Beginning Juiy 1, 2007, the performance of the portfolio will be compared to the return of a portfolio comprised of 43% S&P5t30 Index, 25% of the LBGC Index, 25°!o LBIGC & 7% TB#II. 2. The evaluation period for tnvemess will date from January 1, 2000. 3, Relative En other sirmitar investment managers, it is expected the manager's performance with regard to the quarterly total return of combined equity, fixed income and cash portfolio will be in the tap forty percent (40%) of the Informa universe over three to True year periods. When quarterly perforr-mance is below the standard, the manager will report to the Trustees the reasons fur the occurrence and the steps Taken to avoid reoccurrence. 62 E. For Rhumbiine Advisors,. Wellingtcn Management, Wenthworth, Hauser and Violich, Logan CaplYat, Voyageur Asset Management & JP Morgan The equity portion of the portfolio, defined as common stocks, convertible bonds, convertible preferred issues and Intematianal equities, is expected to perform over three and five year periods at a rate at least equal to, for: Rhumbiine, fhe S&P Midcap 400 Index and in the top 40% of the Infomta Broad Equity Universe Wellington, the Russell 2000 Index and in the top 40% on the Informa 8raad Small Cap Universe Wenthworth. Hauser and Viofich, the MSCI EAFE Index and in the top 40%n of the Informa Intemational Equity Universe Logan Capital,. the Russell 1000 Growth index and in tho top 40% of the lrtforma Broad Large Cap Growth Universe Voyageur, the Russell 1000 Value fnd®x and in the top 4l)°/0 of the Informa Large Cap Value Universe JP Morgan,. the NCREtF Property Index. and In the top 4fl% of an appropriate universe The evaluation period for Rhumbiine will date From July 1, 1997; for WeUfngtoh, July 1, 1999; for Wenthworth, Hauser and Vtolich, May 1, 2008, Logan Capital and Voyageur will date from April 1, .2007 and JP Morgan will date from august 1, 2007. 111. AUTHORIZED INVESTMENTS A, For Atl Equity Investment Managers 1. Time, savings and money market deposit accounts of a national bank, a state bank of a savings and loan association insured by fhe Federal Deposit insurance Corporation grnvided the amount tlepasited_does not exceed the insured amount, 2. Money Market obligations issued by the U.S. Govemmeni, or in obligations guaranteed as to pr'rncrpal and interest by the United States Government or in obligations guaranteed as to principal and interest by the United States Govemmont agency. Ail money market issues must rank as either Standard & Poor's A1, or Moody's P1. 3. Domestic and International Equities: equities defined as common stccks and issues convertible to equities, provided: a. Each holding shalt be listed an a major U:S. exchange. b. Not more than five. percent (5%) of the Fund's assets shall be invested in the common stock or capital s±ocic of any one issuing company, nor shall the aggregate investment in any one issuing company exceed Hve percent (5%) of the outstandiny capital stock of the company. 4. The use of unhedged and/or leveraged derivatives will not be allowed in any form. 8. For Inverness' Fixed Income Portfolio a. All issues shalt meet or exceed Standard & Poos's A1, or Moodys P1 credit rating. 84 5. Bonds issued by the State of Israel 6. Commingled stock, bend or money market funds whose investments are restricted to securities meeting the above criteria. 7. The use of unhedged andlor leveraged derivatives will not be aitowed in any form. C. Limitations Counsel's 2. No limitations are placed on money market investments. IV. COMMUNICATIONS or B. Meetings: l"he Trustees wi11 meet quarterly wfth the .monitoring service's representative to review the performance report. At least semi-annually, the Trustees will meet with each investn;ent manager and appropriate outside consultants to discuss performance results, economic outlook, investment strategy and Tactics and other pertinent matters affecting the Fund. B.5 C. The Managers will immediately disclose any securities awned in the past or presently held securities which are not in compliance with Section 18, Q. The Manager's quarterly report will fist separately any security evhose value has diminished twenty-five percent (25%) or more from the purchase price. E. The Managers shall report to the Trustees on an annual basis. how each proxy was voted, the issue as to each, and .the date the proxy eras voted. If a proxy was not voted, the Manager shall provide a written statement indicating the reason that particular proxywas not voted. F. The Trustees may wish to recapture as many of their commission dcllars as possible consistent with obtaining the "best. execution" as defined in ERISA Technical Release 9fi-1 which is made part of this agreement by reference. G. ',Nhen there is env charr:n in nMmorchin of fhc i.n.....~....,s ...:.................. a~ ..._ CRITERIA FOR INVESTMENT MANAGER REVIEW The Board wishes to adopt standards by which judgements on the ongoing performance of a portfolio manager may be made. 1n this regard, the following will be dosely monitored: t. Four consecutive quarters of total fund performance bebw the fdtieth (50~') percentile in manager rankings. 2. loss by the Manager of any senior investment personnel. 3, Any change in basic investmentphilosophy by the Manager. 4. Failure to attain a 6t}% vote of confidence by the Board members. The above criteria shall in no way limit or diminish the Trustee's right to terminate a RAanager at any time for any reason. VI. FLORIDA STATUES AND APFLICAbLE CITY ORDINANCES OF MIAMI BEACH ORDINANCES H at any time this document is found to be in oonfllct with Fbrida Statutes, or the applicable City of h9iami Beach Ordinances, the Statute and Ordinances shall prevail. Vtl. REVIEW AND AMENDMENTS It is intended the Investrtrent Manager and Trustees review tflis document periodically. In this regard, the Im~estment Manager's interest in consistency in these matters is recognised and wilt be taken into account evhen changes are being considered. !f at any time any Investment lvtanager feels that the specific objectives deCred heroin cannot be met, or the guidelines cronstrict performance, the Trustees should be so notified in wrfting. By initial and continuing acceptance of this Investment Policy Statement, the Investment Manager caacurs with the provisions of this document. For invemess Counsel as investment Manager Date For Rhumbllne Advisors as Investment Manager Date For Wellington Management as tnvestrnant Manager Date t37 For the Board of Trustees of the Miami Beach Date Firefighters' S police pfttcers' Pension Fund STATEMENT OF INVESTMENT POLICY FOR CITY PENSION FUND FOR FIREFIGHTERS ANE3 (~OLtCE OFFICERS IN THE CfTY OF MIAMI BEACH QROP Accouwrs The Retirement Board (the "board") of City Pension Fund for Firofighters and Pogce Officers in the City of Miami Beach, as famed Fiduciary and Plan Administrator hereby adopts the foElowing Statement of Investment Policy for its DROPPian{the "Plan') i. Statement of Funding Policy and Ntethod The principal purpose of the DROP Plan is to provide certain .benefits upon actual retirement and thereafter. Thus, the principal goal of the investment of the funds in the Plan should be both security and bog-term stability with moderate growth expectations. The Plan will be funded with deposits and reinvestment of income in an IRS-qualified retirement plan and Dust exempt from income tax. under IRC Section 501(a) III. Objectives The primary investment objective of the DROP Plan. is to offer the participants a rang6 of investment choices to permit diversification among different asset classes and the opportunity for the growth of their accounts.. The objectives are further defined as follows: ~. To provide sufficient investment choices so that DROP participants will be able to choose the investment mix that may fall within a full range of r.Lsk and return characterisGrs they deem appropriate fior themselves. 8. To provide sufficient investment choices so that the asset classes selected shall be such that, taken together, participants vrill have a reasonebte opportunity to C'i materially affect the potential investment returns rn their accounts, while at the same time controlling risk or volatility. C. To provide sufficient investment choices so That participants will have adequate opportunity to diversify so as tb reduce the risk of loss. IV. Guidelines D. The responsibility of the F3oard and its tiduciarles ends with the selection and monitoring of DROP investment performance. Individual investment .decisions and asset allocations made by DROP participants are solely within the discretion of the member and. are not the responsibility of the Boats. DROP participants are urged to consuk with their accountant andlor an investment .professional in selectog self-directed investments whlCh are consistent with the finanaai needs of the member. DROP participants are also urged to monitor investment performance as they would for their personal portfolios. V. DROP Participant Direction A. All current DROP Participants (at the Gme of the Inftial impiementa6on of the Ernpioyee-Directed Uption) shall be given a choice between the following investment vehicles: 1. A variable investment return credited annuaNy, equal to the investment return experienced by the Pension Fund as a whole. net of investment anal administrative expanses (called "The Fund Rate Option"), or 2. A variable investment return based upon the actual performance of various investment funds in vfiich they choose to invest (called "The Employee-Drrected Option"), net of investment and administrative expenses. C2 Once the Employee-Directed Option is elected, a DROP Participant may net change back to the Fund Rate. It is an irrevocable election. Any current DROP Participants who fail to make an election hereunder, shall be deemed to have elected the Fund Rate and shall remain therein unless directed otherwise. All current DROP Participants electing the Fund Rate (whether by explicit or deemed election) may change that election to enter the Employee-Directed Option, but only to be effective October 39, Novemner 30, or December 31, 2002. However, the actual Transfer of funds to the self-directed account shall be deferred until the interest credit for the period ending on the election effective date has been determined. Future DROP participants shat! be required to use the Empbyee-Directed Option. The Investment Policy Statement for The fund Rate Option shall Me the Investment Policy Statement adopted by the Board for Fhe Pension Fund as a whole. DROP Participants electing The Employee-Directed Option shay be given control over the investment allocation process. This shall include the right to change investment .allocations of existing account balances and future contributions at least once every three months. Participants shall also be given arty and all information that the Board deems necessary for participants to understand the investment funds and to make informed Investment decisions. Participants shall have the fight to direct the investment of certain funds contributed fo the Plan as specified in the Plan documents among the investment fund attematives chosen by the Board. Vl. Asset Classes. (The Employee-Directed Option) A. Broad Asset Glasses shall be selected by the Board. individual investment attematives shall be selected by th© Beard which represent the respecWe Asset Classes. 8. Asset Glasses shall be selected based upon general non-correlation of returns, fundamentally dissimilar underlying instruments, and generally accepted investment standards. Coruideration shall also be given. to the number of separate investment alternatives deP.med prudent by the Board. Asset Classes considered may include: Large Company8tock Mid-Size Company Stock Smatl Company Stock Foreign Stock Balanced Funds Fired Income Stable Valuo (G!C) P~laney Market C. As a result of review and analysis, and in consideration of die criteria outlined in this policy, the Board has selected the Asset Glasses outlined in Appendix A, as attached hereto. It is understood that this list is dynamic and subject to change by amendment of this Policy. C3 VII. Implementation Procedure (Employee-Directed Option} A. The Board shat! use business judgment in selecting investment products such as open-ended mutual funds, insurance investment products, common or collective trust funds, and money manager separate accounts. Passive and active management strategies will be considered. The Board may select, for member- directed investments, a commingled fund, e.g. a group, collective or common trust maintained by a corporate trustee, regardless of whether such trustee is the Plan's trustee, investment manager, or otherwise aparty-in-interest of the Plan and that the Board adopts and incorporate the governing provisions of such fund herein, B: The fcllowing characteristics (when aoolicable) erect others shall he cnnsidarari in 1. 2. 3, 4. 5. 8. Be#a Calculations and t~atiq Alpha Returns and b. Debt instruments Duration Average Effective Maturity Credit Quality Average',ttfeighted Coupon Composition of Fund Yield Measures Assets Under Management C. Miscellaneous Criteria - In selecting the specific Investments to be made available to partidparrts, the Board may consider the following additional criteria: 1. Nature and frequency of investment reports 2. Availability and access to administ.*ator 3: Correspo+iding costs and expenses associated with plan recordkeeping a. Quantitative and qualitative due diNgence regarding the money managers 5. Name Recognition Vitt. Criteria for Selection/Retention of Investment Attemaiives (The Employee-Directed Qption) A. Each investment alternative shall be, measured against Benchmark Returns. The Benchmark Retums for each investment alternative shall he the lesser of the C4 returns of art appropriately selected and publicly available index and the average (or median) net returns of an appropriately selected peer grarp{s) universe(s) of similarly managed funds. The appropriate selection of Indexes and Funds shall be made on the advice of the Investment Consultant and shall have financial characteristics appropriate to the particular intended style of the respective investment alternatives being measured. B. The performance of each investment may be measured against additional standards and benchmarks established by the Board from time to time as criteria for continued retention of each investment. The following information may be considered in determlMngrf an investment option should be replaced. or stated investment ~. A trend of increasing volatility expressed by standard deviation or downside volatility. 5. A net return lower than ttte Benchmark in any four consecutive calendar quarters. 6. An average net return lower than the Benchmark for the three year period ending on a calendar quarter. 7. 'Sharpe Rattos andJor Morningstar Category Ratings lower than the The Board acknowledges that fluctuating rates of return characterize the securities markets, particularly during short-term time periods: Recognizing that short-term fluctuations may cause variations in performance, the Board intends to evaluate, manager performance from along-term perspective. C. Qualitative due diligence of Each fund may (but need not) be conducted through annual written or oral interviews wRh .appropriate parties at each investment manager. Any issue materially affecting the management staff and investment process associated with each fund will be considered, including; 1. Changes to the management team or the firm's ownership. 2. Modifications to the fund's investment policy, .philosophy and decislorr process. 3. Deviation of investment style, regulatory action, and investigation or litigation by a government agency. L5 Appendix A SELECTION OF FUNDS Td FULFILL THE STATEMENT OF INVESTMENT POLICY FOR City Pension Fund for Firefighters and Police Officers in the City of Miami Beach EMPLOYEE-DIRECTED -DROP ACCOUNTS C6 Pursuant to our Statement of Investmen± Policy the Board as the Plan Fiduciary (ies) has selected the following. investment alternatives representing the stated asset losses; iN~'EJ`TMENT OBJECTIVES & POLICY STATEttiiElT' N'f~i2 MIAbiT BEACH EMPLOYEES RE'FIREhiENT PLAN April 29, 200$ 10.0 POLICY REVIF,W .................................................................................................16 11.0 Rcspnnsibiliacs of Custodian ................,...............................................................16 APPENDIX .............»»..»..«».»....................»»...._..................»...........»...................................... i9 A~Siami Beach Ordinance 2000-3247 ...............................................................1~ Portfo3io MoniWring Form ......................................_.................................20 Preface INVESTMENT GI7IDL~LINE REQtiRF.MF:NTS ()F I?LOR1llA STATUTE 112.551 There are seventeen specific requiremwts of Florida Statute I I2.661. Each of these. seventeen requirements is listed below and the page number and section in Investment Clbjectivcs & Policy Statement that refer to these requirements is given. Tt is the intent of Htis Statement to comply with sll of the requirements of tkus Statute. l . SCUPS: Page 1, point 2.0 Policy Scope. 2. INVESTMENT O$3ECTTVES: Page 2, point 3.3 Investment Objectives. 3. PERFORMANCE MEAS(}RE4fENT. Pages 5-6, point 4.4 Ttrvestmcnt Objectives (Performance Measurement). 4. INVES'T'MENT' AND FIDUCIARY ST'ANfl.A3tDS: Pages 2-3, point 3.5 Board Responsibilities (investment and Fiduciary Standards). 5. AUTTTORIZF:D INVE5T1vIENTS: Pages 9-12, point 5.41nvestmcnt Manager Guidelines (Authorized Tnvestmenic). , 6. MATURITY & LIQIIIDTTY' T2EQUI12F..MENTS: Page 3, point 3.6 Maturity & Liquidity 9. EXPECI'E of Return.. 12. RiD RF.QliIREl.4EN'T: Page lS, point 7.1 Bid Requiretnestt. 13. [[d'1'ER.iIAL CON'I'ROT. S: Pages 3-A, point 3.8 Polioics to Enstue Ethical &.Prudent Action (Lntemal Controls). t4. CONTINIJINi; L°DI1CA"CIC1N: Page 3, point 3.7Tiaining cl~ liducationPolicy (Continuing Education). 15. REPORTING: Pages IS-15, points 8A &,B.T Portfolio Reporting Requirements. 16. FILING OF INVESTMENT POLICY: Page 1, point 1.2, Policy Statemcm Requirements (Filing of Investment Policy}. 17. VALUA'T'ION O}' IT.LIQUID 1NVFSTME13T5: Page 9, point 5.4 (1) Diversiftcarion, Liquidity & Restrictions {Valuation of llliquidlnvestments). ~~rlAlyrr BEACx E.NIPLOYEES XF.T.IREIVILNT PLAN INVESTMENT OBJECTIVESAND POLICY.STATE~lErVT FART I P()I.ICY Pi~;itfiPECTiVES 1.0 IN7'RODUCTTON r1ND POLJCY S'fA"I'Ei~IF;NT 3.0 POLICY UBdECTIVE5 The basic objectives of the Board's investment program are the follrnving: 3.l Plen h4anagemeut Objeciivcx Safety of funds invested; 2. Liquidity suf&cient to meet all Nash needs of the Plan; 3. .Investment pertomtance t}tat i5 wmpctitivc in tltecurrent market environment once the first two objectives have been sazisfred. 3.2 Basic Goals The goals of the Board are to fund the Plan's benefit payments; while assuming a risk posture tha4 is consistem with the Board's risk tolerance, protect against loss of purchasing power by ttchieving rates of return above inflation, and obtain (er retain) a fully funded pension status. 3.3 Investmcat Objeciires the Board's investment objectives are as fellows: I) Ata minimum, achieve a return equivalent to the Plan's achtarial fnterest rate, while achieving a return 4% above intlation. 2) Exceed the return of the Plan's passive, masker-based, investment benchmark. Allocations to specific asset [:lasses are based on the Plan's target asset mix, which are based on the Plan's asset allocation study and the constraints established by City Ordinance. 3) Achieve a total Fund return ranking above the median of other public sector retirement funds. Risk-adjusted perfomtance is expected tb also be above that of the median pension fund. 3.4 Eapectal Annual state of 12etura As required by Florida Statute 112.Gtil, the Boazd sl-.all specify fire Plan's total expectexi annual rate of return for the cturrnt year, for each of the next several years aztd for the long term. 'f he Board's expected returns for each ofthese time p®riods is the actuarial interest rate, as specified in the actuary's mast current actuarial valuation. "the current actuarial interest rate is 8.5°,6. 3.5 Board Responsibftities (lnvestnaent & ~dueiary Standards) The Brxrrd holds the fiduciary responsibility for the Plan. While the I3oard recognizes that rho primary determinant of ibe Plan investment per€ormance is the total Fund's asset allocation, the Berard aiso recognizes that the Fund must operate within the constraints and guidelines of the City Ordinance.. The Hoard shall set a reasonably diversified overall asset allocation target (including minimum and maximum allocations), which is expected fo appropriately fiord the Plan s liabilities, tueet its basic investsnc;nt objectives and match its risk tolerance. The Fund will besnvcstrd in a marmer consistent with applicable Miami Beach Ordinance No. 7.Q06-3504 and Florida State laws, k is atso the goal of the Aoard to manage the Fund according to standards that are at least as high as those established by 3.6 the Employee Retirement Income Security Aot (EItISA). Thetrtvre, the Boazd wi11 act in a prudent manner and expect its investment managers to acras prudent experts. The Board will also ensure that Plan investments are made for the sole benefit of Platt members and beneficiaries. 3.9 'Thiri 1) 3.18 employees of the itetirement Plan. (:ontiols deemed most irnpr!rtant include: control. of collusion, separation of duties (e.g-, separating transactions authority from accounting authorization), custodial safeket:pirtg and dear delegation of authority. 11te~: controls sitall be reviewed bo the Board's independent certified public accountant. 2) Annual policy reporling a) As discussed below, the investment managers will be requested to iirovide a current copy of their internal ethics pniicies, a sworn statement pursuant to Section 287. ].33 of the Florida Statutes (Public Entity Ciime), and annually ail other itttetnat politics that relate to the Plan's portfolios. DART II PLAN POI2TFULIU MANAG~:i~iF,NT A.0 IvVESTMEIVT POLICIES 4.1 DiversiPcation 4.2 4.3 Style Orientation 4.d Investment Objesiives (Performance Meaanremen!) wilt aiso 2) 3) 4) The above tluc~ invesmrent objectives apply to the Plan. Hv~vever, these same objectives also apply to the Plan's individual investment managers. 4.5 Asset Allocatloa Plan Based on the Plan's asset allocation study and. acceptance of the proposed tatgetasser mix (most recently updated in November, 2007), the following is the Plan's maximum asset allocation: Alloca?inn Maximum Total Domestic Equity 64.0 Large Cap 60.0 Mid Cap 14.0 Small Cap 5:0 Lnterna?ionrl Equity 20.0 A}tcmative Investments 6.0 Domestic Fixed Income 100.0 Shore-Term Investments 100.0 "1'he market benehmarks £or the above asset classes are as follows: Large Cap Fiquity S&P 500 Index Mid Cap Equity SAP 400 Index Small Cap Equity S&P 600Index International Pgaiiy Europe, Australia; & Far Gast Index (EAI`!r) Alternative Investments (To be determined, based on applicable assetclass.) Domestic Fixed Income Lehman Aggregate Boad Index Slwrt-Term Fixed Tncomc 90-Day lieasury Bitls Yankee band securities (foreign bonds denominated in i7. S. dollars) may be held in fixed income portfolios, • Nan-dividend paying common or preferred stocks may be held in common stack portfolios. • "lhe maximtun total fund allocation to common and preferred stocks (domestic and international) is 60%, with international stocks limited to 10% of the total fund. The I O%international equity a]]ocatian Limits based upon securities held in portfolios that are invested solely in international equities. PAitT III IIWESTMENT GUt;~E~.,INk:S 5.0 INVESTMENT M~iAGERS' RI':SPONSII3II.ITIES, POLICIES Ai`il) 5.1 Investment Managers' RespoasibFtities It is the responsibility nfeach imestmcnl rnattagcrio provide a curnnt version aftheir internal code of ethics. Additionally, once a year the manager will provide updated 5.3 Derivatives Investing Politics I) Investment Restrictions and Detvatives Policy For the purpose of FiFese guidelines, con~~trtibla debt, traditional zero coupon botxis, mortgage pass-Uuough securities and asset-backed securities are not viewed as derivatives. These investment securities aze requimd to meet all of the guidelines estabiishcd for the Plan's badiiionai investments. 'L'he following guidelirtes have bin established: Allowable derivative investments a. Stable and well-structured mortgage CMO's (collateraliced mortgage obligationaj b. Financial futures (if exchange iradul). Acceptable financial future contrasts include fitiurds on Treastay Bills, Agencycertificates,?'reasury Bondsand SBcP SOO, S~.P 4U0 and SXaP 600 Stock Index futures. Any ocher derivative than those speciftad as allowable invtxtmerfts above cannot be held in the Plan's portfolios at any time. 5.4 ~A liquid security is one that has a readily available price, based either on a «:centtmde or o well- recognized pricing mechanism. Such a seczuiTy could be sold within one week at most, without inciming significant losses due to price depreciation, in a normal or typical capitalmarket em~ironmcnt. No single security can represent more than 5% of the market value of a portfolio at the time of purchase: No single industry (based on the (iiobal Industry Classification System codes) can. represent more than 1 S%° of the market value of the account. 6) Developed country international equity. portt"olios will be measured against a reasonable version of the ArISCI EAFE Index (F..uropc, Australia, and the Far Ease}. It'the manager feels another index is more appropriate, this case should be made in writing to the $oard. No single security can represent more than S% of the market value of a portfolio at the time of purchase. No single market sector (baeed on the Eirrnpe, Australia and fiar East Stock Index scctorsl can represent more than 3t)% of the market value ofthe account. Domestic Fi:ed Income Portfolios Acceptable security types for domestic fixed income. portfialios arc certificates of deposit, commercial paper, othc7 high grade.shot-term securities, iJ: S. Govcrnnrcnt and Agency securities, corporate bonds, mortgage-and asset-backed securitiest and Yankee bond sectuties. Cash and equivalent holdings maybe '' Please note that mortgage- anti aseet-backed securities are technically derivative securities but for the purposes of this Policy Snuement these securities .uc: not e3aesifted as a derivative. Such invesurtents must be at least BI3#3.Baa rated. comprised of high grade cerrificatcs of deposit, commercial paper, U. S. Treastny bills and repurchasz agreements. PAI21' ! V <:O[tiTit~I~S 6.0 PROXY VOTING b.l T'he Board's primary objective is w have i[s proxy ballots voted according to tho best economic interest of the Plan's members. if the Board decides w delegate w their investment managers the responsibility For noting proxy ballots, the investment managers agree fo e:lassify and report nn the Plan's proxies according w the fbtlowing generic categories: Derivative securities may not be held in domestic ftxed income portfolios, except as provided in Section 5.3 atxwt. Annd portfolios may invest up to 10°t° oftheir assets in Kule 144A. bond issues, with potenGal3y up w an index weighting in foreign domiciled ISSLeTS. 7.0 guideline of voting all proxy ballrrts according to the. best economic interest of the Plan's members. In such cases, when reporting to the Soard in their regular quarterly mport, the investment manager sisal! explain why shay did not vote according to the Board's issue- specific proxy guidelines, 9.0 10.0 POLICY REVIEW This investment policy shall be reviewed periodically to enstue the Pltut s coazpliance with the overall objectives of safety, liquidity and investmetx performattc:c, and cunratt laws and financiaF n~entis. Proposed amendments to the Policy shall be prepared by the staff and Ptazt's consultant and shall be presented to the Beard forconsideralion and approval. 11.0 RESPONSI111LITIES OF CUS'fODIA'~i The Board rewgnizcs that accurate and timely completion of custodial i'tmctiuns is necessary for the effective monitoring olthe invesuttem martagement activity. the custodian's responsibilities fortha Plan's investable assets are to: 12.2 Provide complete cuswdy and depository services for the Plan's designated accounts.. 11.2 Provide a Short Term Invesv~rtent Fund (STIF) for investments of any cash, to ensure maximum investment of the Plan's assets. 12.3 Provide in a timely and effective mariner, settlement of securities. tsansactions and provide monthly reports of t}u: investment actions isatpt lementetl by the Plan's investment managers. market value to that provided by the Plan`s custodial bank. 'the Plea's custodial trustee accounts for investments on a trade date basis. EJCplanafion of disa:repancics shall be provided. 6} Portfolio positions and transactions: l l.d Collect all income and principal malizabie and properly report the collections on the custodial periodic statements. 11.5 Provide monthly and fiscal year-end accounting statements for tha Plan's portfolios, including all transactions. These statements should be based on accurate security values both for cost and market. These reports should be provided within an acceptable time frame. 11.6 Report to the Plan situations where accurate security pricing, valuations and accrued income is either not possible to repot! or is subject to-considerable uncertainty. 11.7 Provide assistance to the Plan to complefe such activities as t}te annual audit, transacztion verification or unique issues as required by the Board 11.8 Provide elecftonic access to accounting and performance reporting systems. i 1.9 Assist the Board in keeping track of securities Litigation. cases of past and current investments made by the Pension Fund's investment managers. Periodic securities litigation reports will be supplied to the Board. to revsew. Revised & Approved by the 1Soard of Trustees. 5/14/f12 Soxrd Meeting Revised & Approved by the Board of Trustees:. 2/5818 Roard Meeting Appendix A MIA;VfI BEACI~I ORDINA1~iGI~. 20DU-3247 Whereas, certain provisions of Ordinance No. 190: which created the General Employees Pension System ("System ~ are in need df amendment to conform W changes to the Related Special Acts of the City of Miami Beach that were approved through referendum on November 2, 1999; and Whereas, the amendments set forth herein were aecommendc:d bythe Boazd of Trustees of the Retirement System for General Employees of the City of tYliami Beach. Now, therefore, be ii ordained by the Mayor and The City Commission of the City of Nfiami Beach, rlorida: Section 1. ~~lmendment of Section 8,01 Thai Section 8.01 of Article 8, entitled"Definitions" of the City of Miami Beach Ordinance No. 1901 is hereby amended ss fo#lows: S:Of Ltvesitttents Section 2. Rclx:alcr. All Ordinances or parts of Ordinances in conflict herewith shall be and the sartte aze heteby repeated Scc'aon 3. Severability. Ff any section, subsection, clause or phrase of Otis Urdinancc is held io be invalid or unconstitutional by any court of wntpetent jurisdiction, thensaid holding shall in no way affcxt the validity of the remaining portions of this Onlinance. Section 4. Effective Date/ 'this Ordinance shall take eff~t on the 17td day of June, 2000: Passed and adopted this 71h day of June, 200(). SF,CTIONS of QRDINANCE No. 8.04 provided by law. ~~F~tta~X I3 PORTFOLIO Id4OMTORING FORM Compliance Certification Statement Miami I3each E;mploy~s Rctiremeitt Plan In accordance with the Investment Ubjec:lives and Policy Statement adopted Febntary 5, 2GOg the following compliance worksheet will be comgletcd by esch of the Plan's investmentmanagers. (hi a calendar quarter-end basis,please complete all of the sections of this doctunent. These statements must be e-mailed to the Retirement Plan's office and investment consultant no later than 10 days after the end of each reporting period. General Compliance Issues l . Has the firm acted as a lxdnciiuyarxl invested its enirusted assets for the sole benefit of the Plan? (3S) Yes1No; __, if n0. please explain. 2. Are tttc Plan's marketlrenchtnarks in therespectiveasset class arcas,acceptabJe to the firm? {4.5) YeslNo: _ If no, please explain. 3. Has the fiirn's insurance coverages been sustained?{5.0) Ycs/1~Io: ~ if no, please explain 4. Ikies the titm eon.9ider any f>f the Ylan's invcsunent ob}eetivcs unreasonable? (5, l) Yes/iJo: Ifyes, please explain. 5. Have there been any siSivScant portfolio developments, changes in firm ownership, Organizationalshvctzueandpcrsonnel?{5.1)YesNo:~__ Ifyes,pleaseexpiain. 6. Havethcre been any changes in the firm's investment approach? (5.2 2) Ycs1No: ~ If yes, phase explain. 7. po the Plan's guidelines require your firm to manage the pottfot%o significantly diffeterxiy than other similar portfolios? {S.2 3) Yes/No: If yes, please explain. 20 8. Have there have been any industry or regalatory disciplinary actions taken agsipst the firm? (5.2 4) YesliVo: _ if yes, please explain. 9. Hare proxy ballots been voted in accordance with the bent economic interest of the Plan's and in a manner consistent with the Board's proxy policies? (5.2 7} Yes/No: ~ if no, please explain. 10. For domestic equity managers, has the firm supported the Plan's eornmission recapture program? (5.2 8) YeslNo: _ If no, please explain. 11: ATe all securities investment grade rated or deemed imrestnrent grade? YesNo Investment Manager Gtsidetit:es (Authorized Investarenls) (Portfolio Composiifon) F. Are portfolio holdings well-diveesified, and made in liquid securities? (5.4 1) YesllJo ,__. If no, please explain. 3. Has the fum engaged in short selling, use of leverage qr margin anchor imestmatrts in commodities? (S.4 1) YcslNo: _ If yes, please explain: Cash & Equivaknta (Master Itepurclease :dlgreement) 1. Does the firm dit+cctly invest in short term fixed income investments? Yesfiio: - If yes, do the investments cozuply with the policies? (5.42). Yes/No: _ ifno, plead explain. Domestic Equity Portfolios (Large, Mid & Smzsll Cap1ta11zafioQ) :, Please state the percentage of the portfolio held in each of the following types of securities: common stock; preferred stock; convosrtiblc securifies; and, cash & equivalents. (5.4 3) 2. What is the Grm's market value allocation to large, mid and small capitalization stocks? (5,4 3) Please specify percentages. 3. Specify if any of the portfolio's holdings are foreigr, ordinary shares. (S.4 3) What percentage ofthe porifolio's holdings arc American )7cpository Receipts (ADR's)? 4. List all securities that have a current market capitalization above 5%. R'ere an}~ of these portfolio holdings above S°,!o at the time of purchase? (S.4 4) Yes/No: 5. Based on the GICS industry codes, what is the largest percentage of the portfolio reptrsented by a single industry? (5.4.4) Please list any industries above IS%. International Equity Portfolios - I)evelaped markets 1. Spet:ify the percentage of the portfolio held in each of the following types of sectmties: foreign ordinary shares; AC)R's; cash c~ eynivalenu {domestic). (~.4 5) 2. Specify the large, mid and small capital'trationoxposure of the portfolios. (5:4 5) 3. Is the firm monitoring the country, cttttcncy, sector and security sciection risks associated with iu portfolio? {5.4 S) Yest~lo: _ if no, please explain. 4. Is the firm in compliance wish the Plan's detYVativca investment po]itiy? (5.3) Yes/'No: if nq please explain. Domestic Fixed Incamc Partfolios 1. State t}te pext:c;ntage of the portfolio held in each of the following types of securities: certificates of deposit; commercial paper; other high Bade. short-term securities; U. S. Government and Agency securities; corporate bonds; mortgage-and asset-backed securities and Yankee bond securities. {5.4 b} 2. Is the firm monitoring iu active investment management decisions relative to ilte Plan's investment benchmark? {5.4 6) Yes113o: _ .If no, please explain. 3. Goes the firrrt conduct itorixon analysis testing? {5.4 6) Yes~[do: ~ Tf no, please explain. 4. Are derivative investmettts in compliance with the Plan's investment pplicics? {33) YesliVo: _ If no, please explain. 5. What percentage of the portfolio is invested in securities below investment grade? (5.4 6) if any below investment grnde securities are held, please explain why your firm is in violation of the investment polices statement. 6. Exetuding U. S. Government and Agency bond holdings, did any individtud bond issue represent more than 5% of the market value of the portfolio? YeslNot _ (5:4 6) 7: Please specify. Whttt percentage of the portfolio is held in domestically domiciled Rule 144A securities? (5.4 ~ Lf greater than IO%, please explain. 5igrrd by: i7ated: arm: 22