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12/19/2023                    !!    !   "    # $#      # $# %   & % $''(   %                     !"# % )   * +## ,  -  " $# .% - / ,  .%         ! ! # .% !! $  !%!!   !!!   &!  &  '& !(  ) &    * !  "!   ! + !  &         ,  #-. % !/   ! # .% !! $  0 !1 ! "2 &   3!( !  ! 4"&  5! 6 !  &  7   !     &   , ,   !  &!  &   !     ,  #- #-- % !/   ! # .%.     !% !/   '  ,  7   8  9 ! :7   ! ; $   ,  #'! , # 0% $1                      !!     "#$#"" !  "%&'& #"   $ %   ( )   " !&'()$*+),)$, **   + ,""( ) % &       -        Pension Trustees Meeting Minutes October 16, 2023 Page 1 City of Clearwater City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 Meeting Minutes Monday, October 16, 2023 1:00 PM Pinellas County, 333 Chestnut Street, Palm Room, Clearwater, FL 33756 Pension TrusteesDraftMeeting Minuteseting Minutes Monday, October 16, 2023nday, October 16, 20 1:00 PM1:0 Pinellas County, 333 Chestnut Street, Pinellas County, 333 Chestnut Street 3375 PensPeD Pension Trustees Meeting Minutes October 16, 2023 Page 2 City of Clearwater Roll Call Present 5 - Chair Brian Aungst Sr., Trustee David Allbritton, Trustee Kathleen Beckman, Trustee Mark Bunker, and Trustee Lina Teixeira Also Present – Jennifer Poirrier – City Manager, Michael Delk – Assistant City Manager, Daniel Slaughter – Assistant City Manager, David Margolis - City Attorney, Rosemarie Call – City Clerk, Nicole Sprague – Deputy City Clerk, and Chrystal Ryals – Interim Human Resources Director To provide continuity for research, items are listed in agenda order although not necessarily discussed in that order. Unapproved 1. Call to Order – Chair Aungst, Sr. The meeting was called to order at 1:59 p.m. 2. Approval of Minutes 2.1 Approve the minutes of the June 12, 2023 Pension Trustees Meeting as submitted in written summation by the City Clerk. Trustee Allbritton moved to approve the minutes of the June 12, 2023 Pension Trustees Meeting as submitted in written summation by the City Clerk. The motion was duly seconded and carried unanimously. 3. Citizens to be Heard Regarding Items Not on the Agenda – None. 4. New Business Items 4.1 Accept the actuary’s recommendations for changes to plan actuarial assumptions and methods, per the Experience Investigation completed by Gabriel Roeder Smith and Company for the five-year period ending December 31, 2022. The Plan’s actuaries, Gabriel Roeder Smith & Company (GRS), have completed an Experience Investigation study for the pension plan and have provided recommendations of changes to the assumptions and methods used in the plan’s annual actuarial valuation. It has been five years since completion of the last experience study for the Draft ager y Clelerk,Ni al Ral yalsals – –Interi da order although not order although not was called to order at der at 1:591:59 p.m.p.m. minutes of the June 12, 2023 Pension Trustees Meeting as sune 12, 2023 Pension Trustees Meeting a ummation by the City Clerk.City Clerk Trustee Allbritton moved to approve the minTrustee Allbritton moved to approve the min 2023 Pension Trustees Meeting as submiPension Trustees Meeting as subm by the City Clerk. The motion was dulyCity Clerk. The mot unanimously.sly. ens to be Heard Regarding Items Nens to be Heard RegardingDsiness Items sinessDe actuary’s rece actuary’s re r the Exr the E hh Pension Trustees Meeting Minutes October 16, 2023 Page 3 City of Clearwater Clearwater Employees’ Pension Plan, with changes adopted by the Trustees in January 2019. The pension plan ordinance requires a study of the actuarial assumptions at least every six years. The ordinance further states (Section 2.413 (i)) “Taking into account the result of such investigation, the trustees shall adopt for the retirement plan such mortality, service and other tables as are necessary and proper.” The net effect of all changes recommended by the study would be an increase in the annual required contribution to the plan of $1,432,403, or 1.36% of covered pay. The results vary for each group, with non-hazardous employees seeing the largest impact (an increase of $1,166,633, or 1.96% of covered pay) and police officers seeing the smallest impact (a decrease of $140,994, or 0.69% of covered pay). The proposed changes include changes to the salary increase assumption, assumed rates of future retirements, assumed rates of future separation from employment, assumed rates of future disability, the assumed probability of being married at retirement, and the assumed age difference between retirees and their beneficiaries. These changes are also described in more detail by the actuary in the attached Experience Investigation report. Staff recommends approval of all recommended changes to more accurately determine the pension plan liability and required funding levels, per the professional advice of the plan’s actuaries. Gabriel Roeder Smith actuary Pete Strong provided a PowerPoint presentation regarding the proposed changes to the plan actuarial assumptions and methods. In response to questions, Mr. Smith said the study looked at the last five years of experience; future changes to salaries would be considered in the next experience study. Experience studies are typically done once every five years. The new assumptions reflect the higher salary rates that were a result of the compensation study conducted in the last five years. The credit balance exists to help stabilize the City's contribution if there is a spike. He said there is approximately $30 million in the credit balance, which is 8% over funded. The normal cost of the pension plan is the cost of benefits earned each year. He said paying the full normal cost preserves the 108% funding status and maintains the plan in the enviable position as being one of the best funded plans in the state. The City Attorney said experience studies can be conducted more often than every five years. Draft re nece the study would be an incree study would be an inc an of $1,432,403, or 1.36% of $1,432,403, or 1.36% group, with nonth non-hazardous employees azardous emplo ase of $1,166,633, or 1.96% of covered 633, or 1.96% of covered the smallest impact (a decrease of $140,994, or ct (a decrease of $140,994, nges include changes to the salary increase assumption, nges to the salary increase ass s of future retirements, assumed rates of future separation from nts, assumed rates of future separa nt, assumed rates of future disability, the assumed probability of future disability, the assumed probabili married at retirement, and the assumed age difference between retent, and the assumed age difference between r nd their beneficiaries. These changes are also described in more dees. These changes are also described in more de actuary in the attached Experience Investigation report.tached Experience Investigation report. Staff recommends approval of all recommended changesStaff recommends approval of all recommended chang determine the pension plan liability and required funddetermine the pension plan liability and required fund professional advice of the plan’s actuaries.sional advice of the plan’s actuaries. Gabriel Roeder Smith actuary Pete eder Smith actuary P presentation regarding the prop regarding the prop assumptions and methods.and In response to questise to qu years of experienof experie the next expethe next exp every five every five that wethat w yeaye Pension Trustees Meeting Minutes October 16, 2023 Page 4 City of Clearwater Trustee Bunker moved to accept the actuary’s recommendations for changes to plan actuarial assumptions and methods, per the Experience Investigation completed by Gabriel Roeder Smith and Company for the five-year period ending December 31, 2022. The motion was duly seconded and carried unanimously. 4.2 Approve pension plan administrative expenditures for fiscal year 2024 totaling a not-to-exceed amount of $359,400. The Employees’ Pension Plan does not have a legally required budget. However, all expenditures must be approved by the Trustees. The following are routine administrative expenditures that staff is requesting approval of for administrative efficiency. The recommended expenditures for fiscal year 2024 reflect a $32,600, or 8.3%, decrease over the approved fiscal 2023 expenditures. This net decrease results primarily from a reduction in pension attorney costs, partially offset by an increase in costs of employee physicals and increased costs of Human Resources and Finance administrative staff support. Training and travel are the estimated costs of pension training and related travel, including fiduciary training for the Trustees and Pension Advisory Committee (PAC) members. This is a not-to-exceed amount given uncertainty regarding the number of Trustees and PAC members that may elect to pursue training. Expenditures for physicals are per the pension ordinance requirement that new employees must pass a comprehensive physical exam to be accepted into the pension plan. An increased volume of physicals is forecast due to staff turnover and projected new hires. Reimbursements to the General Fund and Central Insurance Fund are for the cost of oversight and administration of the Plan. The reimbursements are for services provided by Human Resources, Payroll, and Finance personnel, along with related operating expenditures. The City Attorney’s Office provides primary in-house legal representation for the plan, while the firm of Klausner, Kaufman, Jensen and Levinson currently serves as the Plan’s outside counsel. The firm of Banker, Lopez, Gassler provides outside legal services for PAC disability pension claims. Annual attorney fees also include medical bills for medical services authorized by the PAC. Draft ear 2024 totaling aear 2024 tota ot have a legally required budget. egally required budget. approved by the Trustees. The following he Trustees. The followin enditures that staff is requesting approval of for is requesting approval of for d expenditures for fiscal year 2024 reflect a $32,600, or r fiscal year 2024 reflect a $32, se over the approved fiscal 2023 expenditures. This net decrease ed fiscal 2023 expenditures. This ne marily from a reduction in pension attorney costs, partially offset by on in pension attorney costs, partially off crease in costs of employee physicals and increased costs of Humaemployee physicals and increased costs of Hum esources and Finance administrative staff support.nce administrative staff support. Training and travel are the estimated costs of pension traininTraining and travel are the estimated costs of pension traini travel, including fiduciary training for the Trustees and Petravel, including fiduciary training for the Trustees and Committee (PAC) members. This is a notCommittee (PAC) members. This is a not--toto--exceed exceed regarding the number of Trustees and PAC memng the number of Trustees and PAC mem training. Expenditures for physicals are per tfor physicals are per employees must pass a compreust pass a compr pension plan. An increasedAn in turnover and projected d proje ReimbursemenReimburseme cost of ovecost of ov serviceservic wit Pension Trustees Meeting Minutes October 16, 2023 Page 5 City of Clearwater Money manager, performance measurement consulting, custodial/safekeeping, and actuary fees (other than actuary hourly consulting and special projects) are all governed by contracts separately approved by the Trustees and are not included in this agenda item total. APPROPRIATION CODE AND AMOUNT: 6467410-5xxxxx (various pension plan expenditure codes) Trustee Teixeira moved to approve pension plan administrative expenditures for fiscal year 2024 totaling a not-to-exceed amount of $359,400. The motion was duly seconded and carried unanimously. 4.3 Approve the new hires for acceptance into the Pension Plan as listed. Name/Job Classification/DepartmentPension Eligibility Date Zouhier Taouil, Skilled Tradesworker, General Services 02/27/2023 Damien Durham, Fleet Mechanic, General Services 02/27/2023 Claudia Goettsche, Crime Analyst, Police 02/27/2023 Louis Alker, Senior Accountant, Solid Waste 02/21/2023 James Fields, Custodial Worker, Police 02/25/2023 Dillon Berry, Fire Medic, Fire 03/13/2023 William Ramsey, Fire Medic, Fire 03/13/2023 Owen Humphreys, Fire Medic, Fire03/13/2023 Nicolas Mora, Fire Medic, Fire 03/13/2023 Amanda Benson, Fire Medic, Fire 03/13/2023 Jasmin Ray, Senior Staff Assistant, Public Utilities 03/13/2023 Christopher Winder, Utilities Mechanic, Public Utilities 03/13/2023 James Jackson III, Solid Waste Worker, Solid Waste 03/13/2023 Frank Chavez, Beach Guard, Fire 03/11/2023 Kaitlyn Jones, Library Assistant, Library 03/11/2023 Amanda Santiago, Accounting Technician, Parks & Recreation 03/13/2023 Diana Rivera, Customer Service Representative, Finance/CS 03/27/2023 James Gray, Fleet Mechanic, General Services 03/27/2023 David Stoner III, Senior Business Systems Analyst, IT 03/27/2023 Kenneth Craven, Network Analyst, IT 03/27/2023 Timothy Dallaire, Parks Service Technician, Parks & Recreation 03/27/2023 Corey Hunter, Parks Service Technician, Parks & Recreation 03/27/2023 William Ambrose, Streets & Sidewalks Tech., Public Works 03/27/2023 Jovontee Frazier, Stormwater Technician, Public Works 03/27/2023 Zackery Skyrme, Recreation Leader, Parks & Recreation03/11/2023 Brooke McLemore, Customer Service Rep., Finance/CS 04/10/2023 Larry Phillips, Customer Service Representative, Finance/CS 04/10/2023 Michael Slatkavitz, Warehouse Supervisor, General Services 04/10/2023 Destiny Jenkins, Network Analyst, IT 04/10/2023 JoAnn Friedwald, Sr. Staff Assistant, Library Department 04/10/2023 Gunner Clark, Sampling Technician, Public Utilities 04/10/2023 Thomas Murray, Gas Technician Apprentice, Gas04/10/2023 Draft codes)s) nsion plan administrative on plan administrativ otaling a nota not-to-exceed amount xceed am seconded and carried unanimously.and carried unanimo e into the Pension Plan as listed.n as listed. fication/DepartmentPension Eligibility DatementPension Eligibility Date uil, Skilled Tradesworker, General Servicesworker, General Serv 02/27/20232/27/20 Durham, Fleet Mechanic, General Servicesanic, General Services 02/27/20232023 dia Goettsche, Crime Analyst, Policenalyst 02/27/202302/27/2023 ouis Alker, Senior Accountant, Solid WasteAccountant, Solid Waste 02/21/202302/21/202 James Fields, Custodial Worker, Policestodial Worker, Police 02/25/202302/25/2023 Dillon Berry, Fire Medic, FireFire Medic 03/13/20233/202 William Ramsey, Fire Medic, FireWilliam Ramsey, Fire 03/13/202303/13 Owen Humphreys, Fire Medic, FireOwen Humphreys, Fire 03/13/202303/13/2023 Nicolas Mora, Fire Medic, FireNicolas Mora, Fire Medi 03/13/20233/2023 Amanda Benson, Fire Medic, Fireanda Benson, Fire Me 03/13/2023/13/2023 Jasmin Ray, Senior Staff Assistant, Public Un Ray, Senior Staff As Christopher Winder, Utilities Mechanic, Pher Winder, Utilities M James Jackson III, Solid Waste Workckson III, Solid Waste Frank Chavez, Beach Guard, Firevez, Beach Guard, Fi Kaitlyn Jones, Library Assistas, Library Assist Amanda Santiago, Accounntiago Diana Rivera, Customera, Cu James Gray, Fleet Gray, Fl David Stoner IIvid Stoner Kenneth CrKenneth C TimothyTimoth CoreCor W Pension Trustees Meeting Minutes October 16, 2023 Page 6 City of Clearwater Amber Brice, Cultural Affairs Coordinator, Office of Innovation 03/11/2023 Jonathon Kline, Police Telecommunicator, Police 02/25/2023 James Gray, Fleet Mechanic, General Services 03/27/2023 Trustee Allbritton moved to approve the new hires for acceptance into the Pension Plan as listed. The motion was duly seconded and carried unanimously. 4.4 Approve the new hires for acceptance into the Pension Plan as listed. Name/Job Classification/DepartmentPension Eligibility Date Desiree Bain, Customer Service Rep., Utility Customer Service 4/24/2023 Donna Ard, Customer Service Rep., Utility Customer Service 4/24/2023 Kelsey Nawman, Customer Service Rep., Utility Customer Serv. 4/24/2023 Simeon Johnson, Fire Inspector I, Fire 4/24/2023 Yvette Rodriguez-Clanton, Contracts & Procurement Spec., Gen. Services 4/24/2023 Shane Barsness, Fleet Mechanic, General Services 4/24/2023 Robert Hickman, Landscape Manager, Parks & Recreation 4/24/2023 Jason Coole, Parks Service Technician, Parks & Recreation 4/24/2023 Cristian Perez, Parks Service Technician, Parks & Recreation4/24/2023 Nicholas Jackson, Parks Service Technician, Parks & Rec. 4/24/2023 James Tran, Marine Facility Operator, Parks & Recreation 4/24/2023 Karen Swafford, Administrative Assistant, Public Utilities 4/24/2023 Ryan Duval, Wastewater Treatment Plant Oper. Trainee, Public Utilities 4/24/2023 Chrystal Robinson, Utility Dispatcher, Gas 4/24/2023 Philip Lewis, Utility Dispatcher, Gas 4/24/2023 Savannah Elliott, Library Programming Specialist, Library 4/22/2023 Olgen Sumulla, Parking, Facility & Security Aide, Public Works 4/22/2023 David Lutz, Senior Professional Engineer, Public Works 4/25/2023 MD Sayedul Arefin, Lead Engineering Specialist , Public Works 4/28/2023 Tanya Nash, Personnel/Payroll Technician, Fire 5/8/2023 Noah Wells, Personnel/Payroll Technician, Fire 5/8/2023 Michael Krutchick, Rec. Facilities Support Custodian, Parks & Rec. 5/8/2023 Armon Reedy, Water Distribution Operator Trainee, Public Utilities 5/8/2023 Tyler Bohnsack, Water Treatment Plant Operator C, Public Utilities 5/8/2023 Marina Tsongranis, Contract & Procurement Specialist, Public Works 5/8/2023 Tatyanna Maridon, Solid Waste Accounts Coordinator, Solid Waste 5/8/2023 Christopher Perry, Solid Waste Worker, Solid Waste 5/8/2023 John Dallaire, Parks Service Technician, Parks & Recreation 5/22/2023 Charles Webb, Recreation Coordinator, Parks & Recreation 5/22/2023 Collin Hurley, Marine Facility Operator , Parks & Recreation 5/22/2023 Ryan Chandler, Police, Police 5/22/2023 Brittney Roy, Police, Police 5/22/2023 Monica Mejia, Police Records Specialist, Police 5/22/2023 Andrija Selak, Project Manager, Public Utilities 5/22/2023 Draft r ac uly secony nsion Plan as listed.an as listed. tion/Department Pension Eligibility Datesion Eligibil omer Service Rep., Utility Customer Service, Utility Customer Se 4/24/2023/2023 stomer Service Rep., Utility Customer Serviceep., Utility Customer Service 4/24/202323 wman, Customer Service Rep., Utility Customer ServService Rep., Utility Customer Ser . 4/24/202323 Johnson, Fire Inspector I, Fireector I, 4/24/2023/24/202 te Rodriguez-Clanton, Contractsontrac &Procurement Spec., Gen.urement Spec., Gen.ServicesService 4/24 Shane Barsness, Fleet Mechanic, General ServicesFleet Mechanic, General Services 4/24/20232023 Robert Hickman, Landscape Manager, Parks & Recreationn, Landscape Manager, Parks & Recrea 4/24/ Jason Coole, Parks Service Technician, Parks & Recreatione, Parks Service Technician, Parks & Recreati Cristian Perez, Parks Service Technician, Parks & Recreaerez, Parks Service Technician, Parks & Recre Nicholas Jackson, Parks Service Technician, Parks &Nicholas Jackson, Parks Service Technician, Park James Tran, Marine Facility Operator, Parks & ReJames Tran, Marine Facility Operator, Parks & R Karen Swafford, Administrative Assistant, PubKaren Swafford, Administrative Assistant, Pub Ryan Duval, Wastewater Treatment Plant Operan Duval, Wastewater Treatment Plant Op Chrystal Robinson, Utility Dispatcher, Gstal Robinson, Utility Philip Lewis, Utility Dispatcher, GasLewis, Utility Dispatch Savannah Elliott, Library Prograah Elliott, Library Prog Olgen Sumulla, Parking, Facumulla, Parking, Fa David Lutz, Senior Profestz, Se MD Sayedul Arefin, Ledul A Tanya Nash, Persa Nash, Noah Wells, Poah Wells Michael KrMichael K Armon Armon TyleTy Pension Trustees Meeting Minutes October 16, 2023 Page 7 City of Clearwater Sean Murphy, Wastewater Treatment Plant Oper. Trainee, Public Utilities 5/22/2023 Zachary Watt, Firefighter/EMT, Fire 6/5/2023 Jose Quinones, Firefighter/EMT, Fire 6/5/2023 Tristan Robey, Firefighter/EMT, Fire 6/5/2023 Fisher Davis, Firefighter/EMT, Fire 6/5/2023 Michael Sadok, Fire Medic, Fire 6/5/2023 Nicholas Steadman, Fire Medic, Fire 6/5/2023 Shawn Binion, Fire Medic, Fire 6/5/2023 Docho Florov, Fire Medic, Fire 6/5/2023 Joseph Jummati, Fire Medic, Fire 6/5/2023 William Thomas, Fire Medic, Fire 6/5/2023 Douglas Black, Utility Dispatcher, Gas 6/5/2023 Kyle Bradley, Water Distribution Operator Trainee, Public Utilities 6/5/2023 Wayne LaFleur, Public Utilities Assist. Mgr.- Infrastructure Maintenance, PU 6/5/2023 Janette Rawls, Senior Human Resources Analyst, Human Resources 6/21/2023 Shivam Shewa, Business Systems Analyst, IT 6/21/2023 Antonio Ojeda Henriquez, Parks Service Technician, Parks & Rec. 6/21/2023 Marissa Pease, Police Service Technician, Police 6/21/2023 Kenny Robinson, Utilities Mechanic, Public Utilities6/21/2023 Trent Marshall, Wastewater Treatment Plant Oper. Trainee, Public Utilities 6/21/2023 Billy Stephens, Solid Waste Equipment Operator, Solid Waste 6/21/2023 Alyssa Feller, Business Systems Analyst, IT 07/03/2023 Daniel Alexander, Police Service Technician - Traffic Crash, Police 07/03/2023 Susan Maloney, Police Service Technician, Police 07/03/2023 Elizabeth Khan, Senior Accountant, Solid Waste & Recycling 07/03/2023 Diego Lozada, Customer Service Representative, Finance/UCS 07/03/2023 Kimberly Rivera Dilan, Customer Service Rep., Finance/UCS 07/03/2023 Courtney Roberts, HR Analyst, Human Resources 07/03/2023 Nathaniel Hampton, Parks Service Technician, Parks & Rec. 07/03/2023 Lillian Acevedo, Accounting Technician, Public Utilities 07/03/2023 Eric Morrison, Stormwater Technician, Public Works 07/03/2023 Bethany Nin, Cadet, Police 07/17/2023 Keyon Evans, Cadet, Police 07/17/2023 Michael Kelchner, Police Officer, Police07/17/2023 Matthew Peterson, Police Officer, Police 07/17/2023 Jason Raia, Police Officer, Police 07/17/2023 Kenneth Casey, Police Officer, Police 07/17/2023 Amanda Royal, Police Telecommunicator, Police 07/17/2023 Morgan Williams, Police Telecommunicator, Police 07/17/2023 Alyssa Atwell, Police Telecommunicator, Police 07/17/2023 Karen Kruse, Accounting Technician, Police 07/17/2023 Nick Bauman, CAD & GIS Technician, Public Works 07/17/2023 Joshua Felix, Parks Service Technician, Parks & Recreation 07/17/2023 Jaycob Bergeron, Parks Service Technician, Parks & Rec. 07/17/2023 Eric Hartell, Parks Service Technician, Parks & Recreation 07/17/2023 Donald Macintyre, Parks Service Technician, Parks & Rec. 07/17/2023 Jamar Williams, Parks Service Technician, Parks & Rec. 07/17/2023 Joshua Ice, Parks Service Technician, Parks & Recreation 07/17/2023 Matthew Carstensen, Recreation Coordinator, Parks & Rec. 07/17/2023 Lisa Byington, Code Enforcement Inspector, Planning & Dev. 07/17/2023 Nicholas Leggiere, Utilities Mechanic, Public Utilities 07/17/2023 Draft 5/20232023 rator Trainee, Public Utilitiesrainee, Public Utilities 6/5/20 Mgr.- Infrastructure astructu Maintenance, PMaintenance, PU 6/5/2 sources Analyst, Human Resources Human Resources 6/21/20236/21/2 Systems Analyst, IT T 6/21/20236/21/20 ez, Parks Service Technician, Parks & Recchnician, Pa . 6/21/20236/21/2 ice Service Technician, Policel 6/21/20236/21/20 n, Utilities Mechanic, Public Utilitiesnic, Public U 6/21/202321/202 ll, Wastewater Treatment Plant Oper. Trainee, Public Utilitiestment Plant Oper. Trainee, Public U 6/21/2023/2023 phens, Solid Waste Equipment Operator, Solid WasteEquipment Operator, Solid Waste 6/21/2023 sa Feller, Business Systems Analyst, Iystems Analyst, IT T 07/03/202307/03 aniel Alexander, Police Service Technician ice Service Technician --Traffic Crash, PoliceTraffic Crash, Police 07/03/207/03 Susan Maloney, Police Service Technician, Police, Police Service Technician, Police 07/03/202307/ Elizabeth Khan, Senior Accountant, Solid Waste & Recyclinghan, Senior Accountant, Solid Waste & Recycl Diego Lozada, Customer Service Representative, Financezada, Customer Service Representative, Financ Kimberly Rivera Dilan, Customer Service RepKimberly Rivera Dilan, Customer Service Rep.., Financ, Fin Courtney Roberts, HR Analyst, Human ResourcesCourtney Roberts, HR Analyst, Human Resource Nathaniel Hampton, Parks Service Technician, Nathaniel Hampton, Parks Service Technician, Lillian Acevedo, Accounting Technician, Pulian Acevedo, Accounting Technician, Pu Eric Morrison, Stormwater Morrison, Stormwate Technician, P Bethany Nin, Cadet, Policeny Nin, Cadet, Police 07/17/2 Keyon Evans, Cadet, PoliceEvans, Cadet, Police 07/10 Michael Kelchner, Police OffiKelchner, Police Off Matthew Peterson, PolicePeter Jason Raia, Police Ofaia, Po Kenneth Casey, Pth Case Amanda Royalanda Ro Morgan WiMorgan W Alyssa AAlyssa KareKa N Pension Trustees Meeting Minutes October 16, 2023 Page 8 City of Clearwater Joseph Ortiz, Utilities Mechanic, Public Utilities07/17/2023 Vaden Moon, Pool Lifeguard, Parks & Recreation 07/31/2023 Jaquez Byrd, Parks Service Technician, Parks & Recreation 07/31/2023 Homero Baeza, Parks Service Technician, Parks & Rec. 07/31/2023 Macktoshia (Tasha) Hadley, Parks Service Technician, CRA 07/31/2023 Harrison "Harry" Zabaleta, Community Redevelopment Spec., CRA 07/31/2023 Mychal Gibson, Solid Waste Worker, Solid Waste & Recycling 07/31/2023 Victor George, Solid Waste Worker, Solid Waste & Recycling 07/31/2023 Peter Lebel, Solid Waste Equipment Operator, Solid Waste & Recycling 07/31/2023 Edvin Muratovic, Solid Waste Equipment Oper., Solid Waste & Recycling 07/31/2023 Bernard Cleveland, Parks Service Technician, Parks & Rec. 07/31/2023 Abyi Santiago, Parks Service Technician, Parks & Recreation 07/31/2023 Konstantinos Apergis, Parks Service Technician, Parks & Rec. 07/31/2023 Donald Holcomb, Solid Waste Equipment Oper., Solid Waste & Recycling 07/31/2023 Abyi Santiago, Parks Service Technician, Parks & Recreation 08/01/2023 Julia Baltas, Community Redevelopment Specialist, CRA 08/14/2023 Willie Culver, Gas Tech Apprentice, Gas 08/14/2023 Savon Stevenson, Parks Service Technician, Parks & Rec. 08/14/2023 Michael Meurant, Parks Service Technician, Parks & Rec. 08/14/2023 Bryce Talley, Parks Service Technician, Parks & Recreation 08/14/2023 Jatavious Byrd, Parks Service Technician, Parks & Recreation 08/14/2023 Adrian Brown, Water Distr Oper Trainee, Public Utilities 08/14/2023 David Williams, Parking Enforcement Specialist, Public Works 08/14/2023 Matthew Ruskey, Parking Enforcement Specialist, Public Works 08/14/2023 Thomas Campbell, CAD & GIS Technician, Public Works 08/14/2023 Angel Castro, Street Sweeper Oper, Public Works 08/14/2023 Brian Boyer, Parking, Fac, & Sec Aide, Public Works 08/14/2023 Delbert Jackson, Solid Waste Worker, Solid Waste & Recycling 08/14/2023 Trustee Beckman moved to approve the new hires for acceptance into the Pension Plan as listed. The motion was duly seconded and carried unanimously. 4.5 Approve the following request of employees Eryn Berg, Finance Department and Charles Eric Wilson, Sr, General Services Department, to vest their pension as provided by Section 2.419 of the Employees’ Pension Plan. Eryn Berg, Senior Procurement Analyst, Finance Department, was employed by the City on February 6, 2016, and her pension service credit is effective on that date. Ms. Berg terminated from City employment on May 25, 2023. Charles Eric Wilson, Sr, Radio Division Manager, General Services Department, was employed by the City on April 15, 1996, and his pension service credit is effective on that date. Mr. Wilson terminated from City employment on May 24, 2023. The Employees’ Pension Plan provides that should an employee cease to be Draft in ycling 0 te & RecyclingRe Waste & RecyclingWaste & Re n, Parks & Rec. n, Parks & Rec. 07/31/207/31/2 , Parks & Recreationarks & Recreation 07/31/2007/31/ Technician, Parks & Rec. ician, Parks & Rec. 07/31/2007 ment Oper., Solid Waste & Recycling Solid Waste & Recycling 07/31/ Technician, Parks & Recreationrks & Recrea 08/01/202308/01/2 edevelopment Specialist, CRAecialist, CR 08/14/2023/2023 h Apprentice, Gas 08/14/202308/14/2023 Parks Service Technician, Parks & Rec. Parks & Rec 08/14/2023023 t, Parks Service Technician, Parks & Rec. Technician, Parks & Rec. 08/14/202308/14/2023 y, Parks Service Technician, Parks & Recreationechnician, Parks & Recreation 08/14/20233 Byrd, Parks Service Technician, Parks & RecreationTechnician, Parks & R 08/14/202308/14/ n Brown, Water Distr Oper Trainee, Public UtilitiesOper Trainee, Public Ut 08/14/202308/14/2 avid Williams, Parking Enforcement Specialist, Public Works rking Enforcement Specialist, Public Works 08/14/08/1 Matthew Ruskey, Parking Enforcement Specialist, Public Works y, Parking Enforcement Specialist, Public Works 0 Thomas Campbell, CAD & GIS Technician, Public Worksmpbell, CAD & GIS Technician, Public Works 08/ Angel Castro, stro, Street Sweeper Oper, Public WorksStreet Sweeper Oper, Public Works 08/14/208/14/ Brian Boyer, Parking, Fac, & Sec Aide, Public WorksBrian Boyer, Parking, Fac, & Sec Aide, Public Wor Delbert Jackson, Solid Waste Worker, Solid WasteDelbert Jackson, Solid Waste Worker, Solid Wast Trustee Beckman moved to approve thee Beckman moved into the Pension Plan as listed. The Pension Plan as lis carried unanimously.animo pprove the following request of emplopprove the following request o rles Eric Wilson, Sr, General Srles Eric Wilson, Sr, Gener ed by Section 2.419 of thed by Section 2.419 of Eryn Berg, Eryn Berg by the by the thath Pension Trustees Meeting Minutes October 16, 2023 Page 9 City of Clearwater an employee of the City of Clearwater or change status from full-time to part-time after completing ten or more years of creditable service (pension participation), such employee shall acquire a vested interest in the retirement benefits. Vested pension payments commence on the first of the month following the month in which the employee normally would have been eligible for retirement. Section 2.416 provides for normal retirement eligibility for non-hazardous duty employees hired prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 55 years and completed 20 years of credited service; the date on which a participant has reached age 65 years and completed ten years of credited service; or the date on which a member has completed 30 years of service regardless of age. For non-hazardous duty employees hired on or after the effective date of this restatement, a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 60 years and completed 25 years of credited service; or the date on which a participant has reached the age of 65 years and completed ten years of credited service. Ms. Berg will meet the non-hazardous duty criteria and begin collecting a pension in September of 2049. Mr. Wilson will meet the non-hazardous duty criteria and begin collecting a pension in May of 2026. Section 2.416 provides for normal retirement eligibility for hazardous duty employees, a member shall be eligible for retirement following the earlier of the date on which the participant has completed 20 years of credited service regardless of age, or the date on which the participant has reached 55 years and completed ten years of credited service. Trustee Bunker moved to approve the following request of employees Eryn Berg, Finance Department and Charles Eric Wilson, Sr, General Services Department, to vest their pension as provided by Section 2.419 of the Employees’ Pension Plan. The motion was duly seconded and carried unanimously. 4.6 Approve the following request of employees Matthew Carter, General Services Department, Kelly Hemming, Information Technology Department, and Donald Packer, Gas Department to vest their pension as provided by Section 2.419 of the Employees’ Pension Plan. Matthew Carter, Skilled Trades Worker, General Services Department, was Draft or nonn--hazardoh nstatement (Januarnstatement (Janua following the earlier of theollowing the earlier of th of 55 years and completed 20 5 years and completed hich a participant has reached age 65 articipant has reached ag redited service; or the date on which a e; or the date on which a rs of service regardless of age. For dless of ag yees hired on or after the effective date of this the effective date of this r shall be eligible for retirement following the earlier of for retirement following the earlier of a participant has reached the age of 60 years and completed reached the age of 60 years and completed edited service; or the date on which a participant has reached the he date on which a participant has r years and completed ten years of credited service. Ms. Berg will ten years of credited service. Ms. Berg he non-hazardous duty criteria and begin collecting a pension in s duty criteria and begin collecting a pension in eptember of 2049. Mr. Wilson will meet the nonMr. Wilson will meet the no -hazardous duty criteazardous duty crit begin collecting a pension in May of 2026. a pension in May of 2026. Section 2.416 provides for normal retirement eligibility forSection 2.416 provides for normal retirement eligibility employees, a member shall be eligible for retirement employees, a member shall be eligible for retirement date on which the participant has completed 20 yn which the participant has completed 20 y regardless of age, or the date on which the pss of age, or the date and completed ten years of credited serveted ten years of cred Trustee Bunker moved nker employees Eryn Bers Eryn Wilson, Sr, Genen, Sr, Ge provided by Sprovided by motion wamotion w Pension Trustees Meeting Minutes October 16, 2023 Page 10City of Clearwater employed by the City on December 5, 2011, and his pension service credit is effective on that date. Mr. Carter terminated from city employment on June 27, 2023. Kelly Hemming, Sr Telecommunications Analyst, Information Technology Department, was employed by the City on February 5, 2018, and her pension service credit is effective on that date. Ms. Hemming terminated from city employment on September 5, 2023. Donald Packer, Gas Sales Representative, Gas Department, was employed by the City on November 8. 1999, and his pension service credit is effective on that date. Mr. Packer terminated from city employment on September 11, 2023. The Employees’ Pension Plan provides that should an employee cease to be an employee of the City of Clearwater or change status from full-time to part-time after completing five or more years (non-hazardous duty) and ten or more years (hazardous duty) of creditable service (pension participation), such employee shall acquire a vested interest in the retirement benefits. Vested pension payments commence on the first of the month following the month in which the employee normally would have been eligible for retirement. Section 2.416 provides for normal retirement eligibility for non-hazardous duty employees hired prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 55 years and completed 20 years of credited service; the date on which a participant has reached age 65 years and completed ten years of credited service; or the date on which a member has completed 30 years of service regardless of age. For non-hazardous duty employees hired on or after the effective date of this restatement, a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 60 years and completed 25 years of credited service; or the date on which a participant has reached the age of 65 years and completed ten years of credited service. Mr. Carter will meet the non-hazardous duty criteria and begin collecting a pension in January of 2042. Ms. Hemming will meet the non-hazardous duty criteria and begin collecting a pension in July of 2029. Mr. Packer will meet the non-hazardous duty criteria and begin collecting a pension in December of 2029. Section 2.416 provides for normal retirement eligibility for hazardous duty employees, a member shall be eligible for retirement following the earlier of the date on which the participant has completed 20 years of credited service regardless of age, or the date on which the participant has reached 55 years and completed ten years of credited service. Trustee Teixeira moved to approve the following request of Draft ated fro s Department, was employeDepartment, was employ sion service credit is effective on service credit is effectiv ity employment on September 11, yment on September 11 Plan provides that should an employee cease to be ld an employee cease to be y of Clearwater or change status from fullchange status from ful -time to mpleting five or more years (nonore years (non-hazardous duty) and ten or us duty) and ten or azardous duty) of creditable service (pension participation), such creditable service (pension participa shall acquire a vested interest in the retirement benefits. Vested d interest in the retirement benefits. Ve on payments commence on the first of the month following the montmence on the first of the month following the mo hich the employee normally would have been eligible for retirement.normally would have been eligible for retirement Section 2.416 provides for normal retirement eligibility for nonrovides for normal retirement eligibility for non--ha employees hired prior to the effective date of this reinstatemeemployees hired prior to the effective date of this reinstatem 2013), a member shall be eligible for retirement following2013), a member shall be eligible for retirement followi on which a participant has reached the age of 55 yeaon which a participant has reached the age of 55 yea years of credited service; the date on which a paof credited service; the date on which a pa years and completed ten years of credited sed completed ten years member has completed 30 years of servs completed 30 years non-hazardous duty employees hireus duty employees hi restatement, a member shall be a member shall be the date on which a participahich a 25 years of credited sercredite age of 65 years and5 years a meet the nonmeet the non-h of 2042. Msof 2042. M collecticollect dutdu Pension Trustees Meeting Minutes October 16, 2023 Page 11City of Clearwater employees Matthew Carter, General Services Department, Kelly Hemming, Information Technology Department, and Donald Packer, Gas Department to vest their pension as provided by Section 2.419 of the Employees’ Pension Plan. The motion was duly seconded and carried unanimously. 4.7 Approve the following request of Jeffrey Harris, Information Technology Department, Tim Hulburt, Solid Waste and Recycling Department, Robert McKnight, Solid Waste and Recycling Department, John “Jack” Sadowski, Public Utilities Department, Daniel Slaughter, Police Department, Patricia Sullivan, City Clerk’s Office, and William Taggart, Police Department, for a regular pension as provided by Sections 2.416 and 2.424 of the Employees’ Pension Plan. Jeffrey Harris, Senior Systems Programmer, Information Technology Department, was employed by the City on November 12, 1996, and his pension service credit is effective on that date. His pension will be effective July 1, 2023. Based on an average salary of approximately $91,600.36 over the past five years, the formula for computing regular pensions and Mr. Harris’ selection of the Single Life Annuity, this pension benefit will be approximately $66,900.72 annually. Tim Hulburt, Solid Waste Worker, Solid Waste & Recycling Department, was employed by the City on April 29, 1996, and his pension service credit is effective on that date. His pension will be effective September 1, 2023. Based on an average salary of approximately $44,908.13 over the past five years, the formula for computing regular pensions and Mr. Hulburt’ s selection of the 50% Joint and Survivor Annuity, this pension benefit will be approximately $29,946.48 annually. Robert McKnight, Solid Waste Equipment Operator, Solid Waste & Recycling Department, was employed by the City on June 16, 2003, and his pension service credit is effective on that date. His pension will be effective July 1, 2023. Based on an average salary of approximately $46,766.49 over the past five years, the formula for computing regular pensions and Mr. McKnight’s selection of the Single Life Annuity, this pension benefit will be approximately $25, 775.16 annually. John “Jack” Sadowski, Wstwtr Trtmnt Plant Chief OP, Public Utilities Department, was employed by the City on March 5, 2007, and his pension service credit is effective on that date. His pension will be effective June 1, 2023. Based on an average salary of approximately $63,768.49 over the past five years, the formula for computing regular pensions and Mr. Sadowski’s selection of the 100% Joint and Survivor Annuity, this pension benefit will be approximately $24,539.28 annually. Draft chnology Departhnology D rt McKnight, Solid Wart McKnight, Solid Wa lic Utilities Department, DanUtilities Department, D y Clerk’s Office, and William ’s Office, and William n as provided by Sections 2.416 andded by Sections 2.416 Systems Programmer, Information Technology mmer, Information Techno employed by the City on November 12, 1996, and his City on November 12, 1996, an e credit is effective on that date. His pension will be effective e on that date. His pension will be e 3. Based on an average salary of approximately $91,600.36 over age salary of approximately $91,600.3 st five years, the formula for computing regular pensions and Mr. Hafor computing regular pensions and Mr. ection of the Single Life Annuity, this pension benefit will be approxime Life Annuity, this pension benefit will be approx $66,900.72 annually.y. Tim Hulburt, Solid Waste Worker, Solid Waste & Recycling Tim Hulburt, Solid Waste Worker, Solid Waste & Recyc employed by the City on April 29, 1996, and his pensionemployed by the City on April 29, 1996, and his pensio effective on that date. His pension will be effective Seffective on that date. His pension will be effective S on an average salary of approximately $44,908.1average salary of approximately $44,908.1 formula for computing regular pensions and Mor computing regular Joint and Survivor Annuity, this pension bSurvivor Annuity, this $29,946.48 annually.annual Robert McKnight, Solid Wasteght, S Department, was employewas e service credit is effectivdit is ef 2023. Based on an ased on a five years, the ffive years, the selection of selection o $25, 775$25, 77 Pension Trustees Meeting Minutes October 16, 2023 Page 12City of Clearwater Daniel Slaughter, Police Chief, Police Department, was employed by the City on October 19, 1992, and his pension service credit is effective on that date. His pension will be effective June 1, 2023. Based on an average salary of approximately $157,059.26 over the past five years, the formula for computing regular pensions and Mr. Slaughters’ selection of the 100% Joint and Survivor Annuity, this pension benefit will be approximately $128,997.12 annually. Patricia Sullivan, Board Reporter, City Clerk’s Office was employed by the City on December 13, 1993, and her pension service credit is effective on February 7, 1994. Her pension will be effective May 1, 2023. Based on an average salary of approximately $48,407.74 over the past five years, the formula for computing regular pensions and Ms. Sullivan’s selection of the Single Life Annuity, this pension benefit will be approximately $38,893.56 annually. William Taggart, Police Service Technician, Police Department, was employed by the City on September 16, 1991, and his pension service credit is effective on that date. His pension will be effective August 1, 2023. Based on an average salary of approximately $55,686.44 over the past five years, the formula for computing regular pensions and Mr. Taggart’s selection of the 100% Joint and Survivor Annuity, this pension benefit will be approximately $42,379.92 annually. Section 2.416 provides for normal retirement eligibility for non-hazardous duty employees hired prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 55 years and completed 20 years of credited service; the date on which a participant has reached age 65 years and completed ten years of credited service; or the date on which a member has completed 30 years of service regardless of age. For non-hazardous duty employees hired on or after the effective date of this restatement, a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 60 years and completed 25 years of credited service; or the date on which a participant has reached the age of 65 years and completed ten years of credited service. Mr. Harris, Mr. Hulburt, Mr. McKnight, Mr. Sadowski, Ms. Sullivan, and Mr. Taggart have met the non-hazardous duty criteria. Section 2.416 provides for normal retirement eligibility for hazardous duty employees, a member shall be eligible for retirement following the earlier of the date on which the participant has completed 20 years of credited service regardless of age, or the date on which the participant has reached 55 years and completed ten years of credited service. Mr. Slaughter has met the hazardous duty criteria. Trustee Allbritton moved to approve the following request of Jeffrey Harris, Information Technology Department, Tim Hulburt, Draft employed bplo it is effective on Fit is effectiv 3. Based on an average3. Based on an averag ast five years, the formula fort five years, the formula f an’s selection of the Single Life selection of the Single proximately $38,893.56 annually.ly $38,893.56 annually. Technician, Police Department, was employed e Department, was employ 6, 1991, and his pension service credit is effective sion service credit is effective on will be effective August 1, 2023. Based on an 1, 2023. Bas pproximately $55,686.44 over the past five years, the 686.44 over the past five ye puting regular pensions and Mr. Taggart’s selection of the nsions and Mr. Taggart’s selection and Survivor Annuity, this pension benefit will be approximately y, this pension benefit will be approxim 9.92 annually. Section 2.416 provides for normal retirement eligibility for nondes for normal retirement eligibility for non-haza employees hired prior to the effective date of this reinstatemented prior to the effective date of this reinstatemen 2013), a member shall be eligible for retirement following th2013), a member shall be eligible for retirement followin on which a participant has reached the age of 55 yearson which a participant has reached the age of 55 year years of credited service; the date on which a partis of credited service; the date on which a parti years and completed ten years of credited servnd completed ten yea member has completed 30 years of servicas completed 30 year non-hazardous duty employees hired ous duty employees h restatement, a member shall be ea member shall be e the date on which a participanhich a 25 years of credited serviccredited age of 65 years and cyears a Hulburt, Mr. McKnHulburt, Mr. Mc the nonthe non--hazahaza SectiSec Pension Trustees Meeting Minutes October 16, 2023 Page 13City of Clearwater Solid Waste and Recycling Department, Robert McKnight, Solid Waste and Recycling Department, John “Jack” Sadowski, Public Utilities Department, Daniel Slaughter, Police Department, Patricia Sullivan, City Clerk’s Office, and William Taggart, Police Department, for a regular pension as provided by Sections 2.416 and 2.424 of the Employees’ Pension Plan. The motion was duly seconded and carried unanimously. 4.8 Approve the following request of Carol Barden, Finance Department, Laura Dann, Library Department, Joseph Hill, Solid Waste and Recycling Department, Vince Kirkland, Public Utilities Department, Todd Kuhnel, Public Utilities Department, Martin Lindemann, Solid Waste and Recycling Department, and Elliot Shoberg, Public Works Department, for a regular pension as provided by Sections 2.416 and 2.424 of the Employees’ Pension Plan. Carol Barden, Senior Staff Assistant, Finance Department, was employed by the City on October 13, 1997, and her pension service credit is effective on that date. Her pension will be effective October 1, 2023. Based on an average salary of approximately $44,931.84 over the past five years, the formula for computing regular pensions and Ms. Barden’s selection of the Single Life Annuity, this pension benefit will be approximately $32,081.64 annually. Laura Dann, Senior Librarian, Library Department, was employed by the City on July 19, 1990, and her pension service credit is effective on that date. Her pension will be effective January 1, 2024. Based on an average salary of approximately $72,214.39 over the past five years, the formula for computing regular pensions and Ms. Dann’s selection of the 50% Joint and Survivor Annuity, this pension benefit will be approximately $61,691.88 annually. Joseph Hill, Solid Waste Supervisor, Solid Waste and Recycling Department, was employed by the City on September 19, 1994, and his pension service credit is effective on that date. His pension will be effective October 1, 2023. Based on an average salary of approximately $68,418.48 over the past five years, the formula for computing regular pensions and Mr. Hill’s selection of the 100% Joint and Survivor Annuity, this pension benefit will be approximately $45,767. 88 annually. Vince Kirkland, Senior Wastewater Collections Technician, Public Utilities Department, was employed by the City on December 21, 1998, and his pension service credit is effective on June 10, 2000. His pension will be effective July 1, 2023. Based on an average salary of approximately $51,389.97 over the past five years, the formula for computing regular pensions and Mr. Kirkland’s selection of the 50% Joint and Survivor Annuity, this pension benefit will be approximately $29,565.36 annually. Draft Department, Laura Dann, epartment, Laura Dann ecycling Department, Vince ng Department, Vince el, Public Utilities Department, Martin Utilities Department, M artment, and Elliot Shoberg, Public Works iot Shoberg, Public Wo vided by Sections 2.416 and 2.424 of the 2.416 and 2.424 of the , Senior Staff Assistant, Finance Department, was employed by tant, Finance Department, was emp n October 13, 1997, and her pension service credit is effective on thand her pension service credit is effectiv Her pension will be effective October 1, 2023. Based on an averagee effective October 1, 2023. Based on an avera ary of approximately $44,931.84 over the past five years, the formuely $44,931.84 over the past five years, the formu computing regular pensions and Ms. Barden’s selection of the Singr pensions and Ms. Barden’s selection of the Annuity, this pension benefit will be approximately $32,081.64 aension benefit will be approximately $32,081.64 Laura Dann, Senior Librarian, Library Department, wasLaura Dann, Senior Librarian, Library Department, wa on July 19, 1990, and her pension service credit is eJuly 19, 1990, and her pension service credit is e pension will be effective January 1, 2024. Basedn will be effective January 1, 2024. Base approximately $72,214.39 over the past five ately $72,214.39 ove regular pensions and Ms. Dann’s selectiosions and Ms. Dann’s Annuity, this pension benefit will be apension benefit will b Joseph Hill, Solid Waste Supolid W was employed by the Cityed by t credit is effective on thfective o Based on an averaon an ave years, the formyears, the form the 100% Jthe 100% $45,767$45,76 Pension Trustees Meeting Minutes October 16, 2023 Page 14City of Clearwater Todd Kuhnel, Lead Engineering Specialist, Public Utilities Department, was employed by the City on September 2, 1997, and his pension service credit is effective on that date. His pension will be effective July 1, 2023. Based on an average salary of approximately $58,653.00 over the past five years, the formula for computing regular pensions and Mr. Kuhnel’ s selection of the 100% Joint and Survivor Annuity, this pension benefit will be approximately $38,829.84 annually. Martin Lindemann, Solid Waste Worker, Solid Waste and Recycling Department, was employed by the City on August 10, 2010, and his pension service credit is effective on November 8, 2010. His pension will be effective August 1, 2023. Based on an average salary of approximately $34,288.38 over the past five years, the formula for computing regular pensions and Mr. Lindemann’s selection of the Single Life Annuity, this pension benefit will be approximately $11,980.44 annually. Elliot Shoberg, Deputy City Engineer, Public Works Department, was employed by the City November 8, 1999, and his pension service credit is effective on that date. His pension will be effective January 1, 2024. Based on an average salary of approximately $113,569.88 over the past five years, the formula for computing regular pensions and Mr. Shoberg’ s selection of the 100% Joint and Survivor Annuity, this pension benefit will be approximately $68,537.88 annually. Section 2.416 provides for normal retirement eligibility for non-hazardous duty employees hired prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 55 years and completed 20 years of credited service; the date on which a participant has reached age 65 years and completed ten years of credited service; or the date on which a member has completed 30 years of service regardless of age. For non-hazardous duty employees hired on or after the effective date of this restatement, a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of 60 years and completed 25 years of credited service; or the date on which a participant has reached the age of 65 years and completed ten years of credited service. Ms. Barden, Ms. Dann, Mr. Hill, Mr. Kirkland, Mr. Kuhnel, Mr. Lindemann, and Mr. Shoberg have met the non-hazardous duty criteria. Section 2.416 provides for normal retirement eligibility for hazardous duty employees, a member shall be eligible for retirement following the earlier of the date on which the participant has completed 20 years of credited service regardless of age, or the date on which the participant has reached 55 years and completed ten years of credited service. has met the hazardous duty criteria. Draft and Recycling and Recycli t 10, 2010, and his penst 10, 2010, and his pens 0. His pension will be effectivHis pension will be effec ary of approximately $34,288.38 ovapproximately $34,288 mputing regular pensions and Mr. gular pensions and Mr. e Life Annuity, this pension benefit will be his pension benefit will b ually. City Engineer, Public Works Department, was s Departmen y November 8, 1999, and his pension service credit is 999, and his pension service date. His pension will be effective January 1, 2024. Based on n will be effective January 1, 2024. Based on salary of approximately $113,569.88 over the past five years, the tely $113,569.88 over the past five ye for computing regular pensions and Mr. Shoberg’ s selection of the pensions and Mr. Shoberg’ s selection of % Joint and Survivor Annuity, this pension benefit will be approximaivor Annuity, this pension benefit will be approxim $68,537.88 annually.y. Section 2.416 provides for normal retirement eligibility foSection 2.416 provides for normal retirement eligibility employees hired prior to the effective date of this reployees hired prior to the effective date of this re 2013), a member shall be eligible for retirementa member shall be eligible for retireme on which a participant has reached the agea participant has reac years of credited service; the date on wdited service; the date years and completed ten years of cmpleted ten years of member has completed 30 yeacompl non-hazardous duty emplous dut restatement, a membent, a me the date on which e on whic 25 years of cre25 years of c age of 65 age of 65 Dann,Dann Pension Trustees Meeting Minutes October 16, 2023 Page 15City of Clearwater Trustee Beckman moved to approve the following request of Carol Barden, Finance Department, Laura Dann, Library Department, Joseph Hill, Solid Waste and Recycling Department, Vince Kirkland, Public Utilities Department, Todd Kuhnel, Public Utilities Department, Martin Lindemann, Solid Waste and Recycling Department, and Elliot Shoberg, Public Works Department, for a regular pension as provided by Sections 2.416 and 2.424 of the Employees’ Pension Plan. The motion was duly seconded and carried unanimously. 5. Adjourn The meeting adjourned at 2:02 p.m. Chair Employees’ Pension Plan Trustees Attest City Clerk Draft rtmen nd 2.424 of2.4 uly seconded anuly second at 2:02 p.m. ChairChair Employees’ Pension Plan TrusteesEmployees’ Pension Plan Trusteesafty Clerk y Clerk Dr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nteroffice Correspondence Sheet TO: Pension Advisory Committee FROM: Chrystal Ryals, Interim Human Resources Director SUBJECT: Recommendation for Acceptance into Pension Plan DATE: October 19, 2023, Subject/Recommendation: Recommend approval of the new hires for acceptance into the Pension Plan as listed. Name Job Classification Department Pension Eligibility Date Balou Ross Customer Service Representative Utility Customer Service 08/28/2023 Jason Haynie Utility Dispatcher Gas 08/28/2023 Saviron Hipps Parks Service Technician Parks & Recreation 08/28/2023 Richard "Ricky" Allison Parks Manager Parks & Recreation 08/28/2023 Scott Cullen Parking Enforcement Specialist Public Works 08/28/2023 Kelly Yesair Parking Citation Assistant Public Works 08/28/2023 Kathryn Sharp-Hautajarvi Parking, Fac & Sec Aide Public Works 08/26/2023 Cedric McBride Stormwater Technician Public Works 08/28/2023 Keith Simpkins Solid Waste Equipment Operator Solid Waste 08/28/2023 Dayna Diskin Parks Service Technician Parks & Recreation 09/05/2023 Kelsy Johnson Recreation Specialist Parks & Recreation 09/11/2023 Jarrel Wade Recreation Center Manger Parks & Recreation 09/11/2023 Lindsey Dicicco Accounting Technician Public Utilities 09/11/2023 Clifford Cotton Solid Waste Worker Solid Waste & Recycling 09/11/2023 Terrance Robinson Solid Waste Worker Solid Waste & Recycling 09/11/2023 Jesse Ornduff Solid Waste Worker Solid Waste & Recycling 09/11/2023 Robert Simon Utility Dispatcher Gas System 09/11/2023 Daniel Tobin Police Cadet Police Department 09/11/2023 Andrew Martin Police Cadet Police Department 09/11/2023 Mitchell Flanger Police Cadet Police Department 09/11/2023 Daniel Braniff Police Cadet Police Department 09/11/2023 Holly Ward Police Cadet Police Department 09/11/2023 William Broyles Police Records Specialist Police Department 09/23/2023 Lucy Cantrell Meter Reader 09/23/2023 James Baker Planner Planning & Development 09/25/2023 Christopher Wiggins Water Distribution Operator Trainee Public Utilities 09/25/2023 Arlene Gomez-Rosario Police Records Specialist Police Department 09/25/2023 Tracy Ashley Customer Service Representative Utility Customer Service 09/25/2023 Zavion Rogers Stormwater Technician Public Works 09/25/2023 Dorothy Xanos Customer Service Representative Utility Customer Service 09/25/2023 Jessica Chueka Customer Service Representative Gas System 09/25/2023 Nicole Brodil Customer Service Representative Utility Customer Service 09/25/2023 Tara Swonger Recreation Supervisor Parks & Recreation 10/09/2023 Gregory Art Parking Attendant Public Works 10/09/2023 Reginald Grigley Customer Service Representative Utility Customer Service 10/09/2023 Mallory Fuchs Development Review Technician Planning & Development 10/09/2023 Brian Maske Traffic Signal Technician Public Works 10/09/2023 Danny Horne Solid Waste Equipment Operator Solid Waste & Recycling 10/09/2023 Paul Williams Solid Waste Equipment Operator Solid Waste & Recycling 10/09/2023 Jon Nardin Building Inspector Technician Planning & Development 10/09/2023 Jalen Jamison Firefighter Fire Department 10/09/2023 Nicole Warder Firefighter Fire Department 10/09/2023 Zachary Adkisson Firefighter Fire Department 10/09/2023 Justin Blocker Firefighter Fire Department 10/09/2023 Jacob Chellew Firefighter Fire Department 10/09/2023 Camilo Espinal Firefighter Fire Department 10/09/2023 Cameron Mills Firefighter Fire Department 10/09/2023 Cameron Snyder Firefighter Fire Department 10/09/2023 Adrian Zeqiri Firefighter Fire Department 10/09/2023 Jason Jones Firefighter Fire Department 10/09/2023 Cody Kerr Firefighter Fire Department 10/09/2023 Stephen Sudu Firefighter Fire Department 10/09/2023 Alex Sexton Firefighter Fire Department 10/09/2023 Michael Girton Firefighter Fire Department 10/09/2023               !!     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"#$#"" "  #%&'& $#    % & (   ) *   !++ "'()*%+,*-*%- ,,  %      -  ., / )   & 0 - ( 1 & 2 & 3( )  4   && 5  , 0  "66"  &0  "',. 7 %  ""%     & %  &&&   "66"    & 0   , & &   &  & , 8   %    & ,  , ( &     &      ,  -  &      -& ,    ,  -  *  9,   - :  &-&    -   -&   , &  &  8,&      --   ;    -   &  ,, ,   <     ,,  1 & - &% ,   )   -  &    , & -    &  - -  -     ,   &  %  * %   & 5  -    % - , 8    , %5  *  &&      ( )    &&          ,   &  ,    5  %  8% ,  8%    %        STATEMENT OF INVESTMENT OBJECTIVES AND GUIDELINES CITY OF CLEARWATER EMPLOYEES’ PENSION PLAN Approved by Trustees December 16, 2019 December 19, 2023 Effective January 1, 2020 January 19, 2024 1 Purpose The purpose of this Statement of Investment Objectives and Guidelines hereinafter referred to as the “Policy Statement” or “Policy” is to assist the City of Clearwater Employees’ Pension Plan (hereafter referred to as the fund) in more effectively supervising and monitoring the investment of the Fund's assets. In the various sections of this policy document, the Fund defines its investment program by: y stating in a written document the Fund's attitudes, expectations and objectives in the investment of Fund assets. y setting forth an investment "structure" for managing assets. This structure includes various asset classes and investment management styles that, in aggregate, are expected to produce a prudent level of diversification and investment return over time. y providing guidelines for each investment portfolio that control the level of risk assumed in the portfolio and ensure that assets are managed in accordance with stated objectives. y encouraging criteria to monitor and evaluate the performance results achieved by the investment managers. This Statement represents the Fund's current philosophy regarding the investment of Fund assets. In addition, although the Fund shall utilize this Policy Statement in making decisions concerning the Fund, it shall not necessarily be bound solely by its contents. Prudence and Ethical Standards The standard of prudence to be applied by the trustees shall be the "Prudent Person" rule, which states: "Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income derived." The "Prudent Person" rule shall be applied in the context of managing the overall portfolio. The trustees shall also be governed by the fiduciary standard set forth in the Employee Retirement Income Security Act of 1974 at 29U.S.C. s. 1104 (a) (1) (A) – (C). In the event of a conflict between the Policy and Florida Statutes or City ordinances, the statutes and ordinances shall prevail. Funding Philosophy The Fund's funding objectives are to be as fully funded as possible so that: y the ability to pay all benefits and expense obligations from the Fund when due is ensured; 2 y there will be no principal erosion of contributed funds or the purchasing power thereof. y a "funding cushion" is maintained within the Fund for unexpected developments and for possible future increases in benefit structure and expense levels; y the Fund assets should earn enough total rate of return over time to reduce the fund's dependency on employer contributions to meet all benefit and expense obligations. Investment results within the Fund are considered to be the major critical element in achieving these funding objectives stated above while reliance on contributions is a secondary element. Liquidity Posture The investment portfolio shall be structured in such a manner as to provide sufficient liquidity to pay obligations as they come due. Liquidity considerations are low in the short-term and intermediate term resulting in an immaterial impact upon investment policy, objectives and guidelines. Roles and Responsibilities Responsibilities of the Third-Party Custodian A third-party custodian will hold all Fund assets other than commingled accounts. In order to maximize the Fund's return, no money should be allowed to remain idle. Dividends, interest, proceeds from sales, new contributions and all other monies are to be invested or reinvested promptly. If funds are not reinvested, then they will be placed in money market instruments or a money market Fund immediately by the designated cash manager working in concert with the custodian. Security lending is permitted if the agreements meet the credit standards of the City of Clearwater and no credit exposure liability is taken to end user borrowers. The custodian will be responsible for performing the following functions: y Accept daily instructions from the investment managers; y Advise investment managers daily of changes in cash equivalent balances; y Immediately advise investment managers of additions or withdrawals from account; y Dispositions of holdings; y Resolve any problems that investment managers may have relating to custodial account; y Safekeeping of securities; 3 y Interest and dividend collection; y Daily cash sweep of idle principal and income cash balance; y Process all investment manager transactions on a delivery vs. payment basis; y Collect proceeds from maturing securities; y Provide monthly statements by investment manager account; y All securities purchased by the Fund shall be properly designated as an asset of the Fund; y No withdrawal of securities, in whole or in part shall be made except by an authorized member of the investment committee or the committee’s designee. Responsibilities of Investment Managers The duties and responsibilities of each of the registered investment advisors retained by the Fund include: y Managing the assets under its management in accordance with the policy guidelines and objectives expressed herein or expressed in a separate written agreement when deviation is deemed prudent and desirable. y Exercising full investment discretion within the guidelines and objectives stated herein. Such discretion includes decisions to buy, hold or sell securities in amounts and proportions reflective of the manager's current investment strategy and compatible with investment objectives. y Promptly informing the Fund regarding all significant matters pertaining to the investment of the Fund assets, for example: a. changes in investment strategy, portfolio structure and market value of managed assets; b. the manager's progress in meeting the investment objectives set forth in this document; and c. significant changes in the ownership, affiliations, organizational structure, financial condition, professional personnel staffing and clientele of the investment management organizations. No deviation from guidelines and objectives established in the Statement should occur until after such communication has occurred and the Fund has approved such deviation in writing. 4 y The Fund formally delegates full authority to each investment manager for exercising all proxy and related actions of the Fund’s investment assets assigned to it. Each manager shall promptly vote all proxies and related actions in a manner consistent with the long-term interests of the Fund and its Participants and Beneficiaries. Each investment manager shall keep detailed records of all said voting of proxies and related actions and will comply with all regulatory obligations related thereto. The Fund shall periodically audit and review each investment manager's policies and actions in this area. y Each Investment Manager shall utilize the same due care, skill, prudence and diligence under the circumstances then prevailing that experienced, investment professionals acting in a like capacity, as a fiduciary, and fully familiar with such matters would use in like activities for like Funds with like aims, while maintaining appropriate diversification to avoid the risks of large losses, in accordance and compliance with all applicable laws, rules and regulations from local, state, federal and international political entities as it pertains to fiduciary duties and responsibilities. y Notifying the Fund of the filing of a lawsuit by a client against the manager alleging breach of fiduciary duty or other willful conduct. Responsibilities of the Pension Investment Committee The Pension Investment Committee (Committee) shall consist (at a minimum) of the following: Finance Director (Treasurer for the Trustees), Assistant Finance Director, Finance Accounting Manager, Finance Debt Manager, and one member from the general public appointed by the Trustees. The Treasurer for the Trustees shall appoint/remove other City employees as needs warrant. One representative for each of the employee unions may also serve on the Investment Committee. The Finance Director or its designee will chair the Committee. A quorum of at least three (3) members must be physically present for all meetings. The Treasurer for the Trustees will make recommendations to the Trustees as to any changes in the makeup of the Committee. The Committee maintains the ultimate responsibility for approving the Investment Policy and managing the Investment Assets. The Plan has delegated to the Committee those responsibilities as defined below. x Oversee the management of the Fund’s assets. x Adopt, review and revise, as needed, an Investment Policy on an annual basis. x Recommend policy guidelines for the asset allocation of the Fund’s assets within the equity and fixed income segments according to investment style, taking into account near term cash needs and liquidity. x Recommend selection and retention or termination of all Investment Consultants, Investment Managers and Custodians. 5 x Review reports from outside professionals and the Investment Consultant on the status of the Fund’s assets. x Periodically measure and evaluate the investment performance of the Investment Managers against the established goals and objectives defined herein and in the Investment Manager’s agreement with the Committee and agreed upon rebalancing procedures for strategic asset allocation. On a periodic basis, in reference to the current liability obligation, an asset allocation study will occur. x Consider, revise and accept (or reject) recommendations made by the Investment Consultant regarding the management of the Fund Assets. x Control and account for all investment, recordkeeping and administrative expenses associated with the Fund’s assets. x Avoid prohibited transactions and conflicts of interest. x Apply the prudent person standard of care in the context of managing an overall portfolio. The annual budget for the Pension Fund will include sufficient funding for the trustees and members of the Pension Investment Committee to participate in pension education opportunities. These educational opportunities will include education on the individual’s duties and responsibilities as well as investments in general. The Finance Director, as Treasurer for the Trustees, will complete no less than eight (8) hours of continuing educational opportunities on pension investments each fiscal year. Responsibilities of the Investment Consultant x Serve as an objective, third party advisor to the Investment Committee. As such, the Investment Consultant will guide the Committee through a disciplined and rigorous process and may make recommendations to the Committee but will not have discretion to make investment or allocation decisions without their approval. x Assist in the development, implementation, review and monitoring of this Investment Policy. x Offer advice that is consistent with the investment objectives, policies, guidelines and constraints as established in this Investment Policy. x Conduct Investment Manager searches and fee negotiations when requested by the Investment Committee. x Provide research, analysis and general information about the Investment Managers. 6 x Measure, monitor and evaluate the investment performance and asset allocation of the Plan and report the findings to the Committee no less frequently than on a quarterly basis. x Periodically monitor the Investment Assets and provide reports to the Committee regarding investment performance and other pertinent information. x Apply the prudent person standard of care in the context of managing an overall portfolio. Compliance With Chapter 2023-28, Laws of Florida The Trustees and the investment managers shall comply with the applicable requirements of Chapter 2023-28, Laws of Florida, including Section 112.662, along with regulations adopted by the Department of Management Services. 1. Definition of pecuniary factor: The term “pecuniary factor” is defined as a factor that an investment fiduciary “prudently determines is expected to have a material effect on the risk or returns of an investment based on appropriate investment horizons consistent with the investment objectives and funding policy of the retirement system. The term does not include the consideration of the furtherance of any social, political, or ideological interests.” [112.662(1)] 2. Exclusive consideration of pecuniary factors: Only pecuniary factors may be considered, and the interests of the participants and beneficiaries of the system may not be subordinated to other objectives, including sacrificing investment return or undertaking additional investment risk to promote any nonpecuniary factor. The weight given to any pecuniary factor must appropriately reflect a prudent assessment of its impact on risk or returns. [112.662(2)] 3. Proxy voting: Only pecuniary factors may be considered when voting proxies. [112.662(3)] 4. Filing requirements: The Plan shall timely comply with the reporting requirement of Section 112.662 by filing a comprehensive report by December 15 of each odd-numbered year. [112.662(4)]. Investment manager’s and the Plan’s investment consultant shall assist in the preparation of the required reports and shall annually confirm to the Plan their compliance with Chapter 2023-28. 5. Contracting and external communication requirements: Manager contracts shall comply with Section 215.855 as follows: Any written communication made by an investment manager to a company in which such manager invests public funds on behalf of the Plan must include the following disclaimer in a conspicuous location if such communication discusses social, political, or ideological interests; subordinates the interests of the company’s shareholders to the interest of another entity; or advocates for he interest of an entity other than the company’s shareholders: The views and opinions expressed in this communication are those of the sender and do not reflect the views and opinions of the people of the State of Florida. 6. The Investment Consultant will provide Investment Managers for consideration who invest only based on pecuniary factors as defined by Florida Statutes §112.662. 7 7. If a Request for Proposals document is issued for Investment Manager services, the solicitation document must include the following: The Plan may not request documentation of or consider a vendor’s social, political, or ideological interests when determining if the vendor is a responsible vendor. Additionally, the Plan may not give preference to a vendor based on vendor’s social, political, or ideological interests. Authorized Investments The following is a list of authorized investments: y Invest and reinvest the assets of the pension fund in annuity (including group annuity contracts of the pension investment type) and life insurance contracts of legal reserve life insurance companies, in amounts sufficient to provide, in whole or in part, benefits to which all of the participants shall be or become entitled to under the provisions of the Fund, and pay the initial and subsequent premiums thereon. Provided that the amount invested with a life insurance company shall not exceed three percent (3%) of the insurance company’s assets. y Invest and reinvest the assets of the pension fund in: a. Time deposits, savings accounts, money market accounts, funds, certificates of deposits, or money market certificates of a national bank, a state bank, or a savings, building and loan association. b. Negotiable direct obligations of, or obligations the principal and interest of which are unconditionally guaranteed by, and which carry the full faith and credit of the United States Government and its agencies. Investments in this category would include but not be limited to the following: United States Treasury Bills, Notes and Bonds, and securities issued by the Small Business Administration, Government National Mortgage Association (Ginnie Mae), Veterans Administration, and Federal Housing Administration. c. Fully collateralized United States Agency obligations, which carry an implied guarantee and the implied full faith and credit of the United States government. Investments in this category would include but not be limited to the following: obligations of the Federal Home Loan Banks System (FHLB) or its distinct banks and Financing Corporation (FICO). d. Other United States Agency obligations, which carry an implied guarantee (Government Sponsored Entities) and the implied full faith and credit of the United States Government. Investments in this category would include but not be limited to the following: obligations of the Federal Farm Credit Bank, Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac), Financial Assistance Corporation and Federal Agriculture Mortgage Corporation (Farmer Mac). 8 e. Collateralized Mortgage Obligations (CMO) and/or Real Estate Mortgage Investment Conduits (REMIC), rated investment grade or equivalent by Standard and Poor's, Moody's, Fitch, or other recognized national rating agencies which are backed by securities otherwise authorized in this ordinance and which are guaranteed as to the timely payment of principal and interest by the U.S. Government or its agencies. f. Securities of countries, states, municipalities and county governments or their public agencies, which are, rated investment grade or equivalent by Standard and Poor's, Moody's, Fitch, or other recognized national rating agencies. g. Asset-backed securities, which are rated investment grade or equivalent by Standard and Poor's, Moody's, Fitch, or other recognized national rating agencies. h. Common stocks, preferred stocks and bonds and other evidence of indebtedness issued or guaranteed by a corporation organized under the laws of the United States, any state, or organized territory of the United States or the District of Columbia or any non-U.S. corporation, provided: 1. The corporation is listed on any one or more of the recognized national or international stock exchanges and/or in the case of bonds and mortgage backed securities, traded among dealers and investors in a recognized and agreed upon conventional format; 2. Unless an asset allocation for less than investment grade corporate bonds is established, all corporate bonds shall carry an investment grade rating as established either by Standard & Poor's, Moody's, Fitch or other recognized rating agencies; and 3. Not more than three percent (3%) of the equity assets of the pension Fund shall be invested in the common stock or capital stock of any one issuing corporation except to the extent a higher percentage of the same issue is included in a nationally recognized market index, based on market values, at least as broad as the Standard and Poor's Composite Index of 500 Companies, or except upon a specific finding by the investment committee that such higher percentage is in the best interest of the Fund; nor shall the non-U.S. investments exceed twenty five percent (25%) of the pension Fund's assets at market. i. Real estate including but not limited to REITS, comingled or limited partnerships. Investments in timber through vehicles such as comingled or limited partnerships shall be treated as a subclass of real estate. j. Alternative Investments, with no more, in the aggregate, than twenty percent (20%) of the Fund in alternative investments, through participation in securities or investments or an alternative investment vehicle that is not publicly traded and is not otherwise authorized by this section. Alternative Investments include securities which fall outside the scope of traditional investments (stocks, bonds, and cash) or are strategies investing in securities using alternative means (derivatives, leverage, short selling), or some combination thereof. 9 An “alternative investment vehicle" is a limited partnership, limited liability company, or similar legal structure or investment manager through which the fund invests in a portfolio company. Investments in public infrastructure projects will be considered an alternative investment. Real estate, including timber investments, are not considered alternative investments for this policy. Investments not listed above in this section are prohibited. Unauthorized Investments Effective July 1, 2009, Florida law was amended to require police and fire retirement plans to identify, publicly report and divest from investments in “scrutinized companies” as identified under Florida law. As a Florida Statute police and fire plan, the Trustees must follow this law. First, the System must identify its holding in “scrutinized companies.” 215.473(t) “Scrutinized Company” means any company that meets any of the following criteria: 1. The company has business operations that involve contracts with or provision of supplies or services to the government of Sudan, companies in which the government of Sudan has any direct or indirect equity share, consortiums or projects commissioned by the government of Sudan, or companies involved in consortiums or projects commissioned by the government of Sudan, and: a.) More than 10 percent of the company’s revenues or assets linked to Sudan involve oil-related activities or mineral-extraction activities; less than 75 percent of the company’s revenues or assets linked to Sudan involve contracts with or provision of oil-related or mineral- extracting products or services to the regional government of Southern Sudan or a project or consortium created exclusively by that regional government; and the company has failed to take substantial action; or b.) More than 10 percent of the company’s revenues or assets linked to Sudan involve power-production activities include projects whose intent is to provide power or electricity to the marginalized populations of Sudan; and the company has failed to take substantial action. 2. The company is complicit in the Darfur genocide. 3. The company supplies military equipment within Sudan, unless it clearly shows that the military equipment cannot be used to facilitate offensive military actions in Sudan or the company implements rigorous and verifiable safeguards to prevent use of that equipment by forces actively participating in armed conflict. Examples of safeguards include post-sale tracking of such equipment by the company, certification from a reputable 10 and objective third party that such equipment is not being used by a party participating in armed conflict in Sudan, or sale of such equipment solely to the regional government of southern Sudan or any internationally recognized peacekeeping force or humanitarian organization. 4. The company has business operations that involve contracts with or provision of supplies or services to the government of Iran, companies in which the government of Iran has any direct or indirect equity share, consortiums, or projects commissioned by the government of Iran and: a.) More than 10 percent of the company’s total revenues or assets are linked to Iran and involve oil-related activities or mineral- extraction activities; and the company has failed to take substantial action; or b.) The company has, with actual knowledge, on or after August 5, 1996, made an investment of $20 million or more, or any combination of investments of at least $10 million each, which in the aggregate equals or exceeds $20 million in any 12-month period, and which directly or significantly contributes to the enhancement of Iran’s ability to develop the petroleum resources of Iran. The definition of scrutinized company is detailed here for your information. However, to be compliant with the statutory requirements, the Investment Committee may look to the Florida State Board of Administration quarterly reports on identified scrutinized companies. Regular quarterly updates can be found at: http://www.sbafla.com/fsb/Home/tabid/369/Default.aspx. The Investment Committee must publicly report any direct or indirect holdings in scrutinized companies. As new companies are identified the Trustees’ must divest within 12 months of when the company was first added to the list. The Investment Committee’s third responsibility is one of two actions depending upon whether the holding is direct (securities are held directly by a public fund) or indirect (securities are held in an account or by a mutual fund in which the public fund owns shares or interests together with other investors not subject to the provisions of Florida Statutes §215.473.) If the holdings are direct, the law requires the Trustees’ to divest from its holdings. The divestiture must be completed by September 30, 2010. No further investments may be made in such companies. Private equity funds are deemed to be an actively managed investment fund. If the holdings are indirect, the Investment Committee must notify the investment manager of the companies on the list and request that the manager remove such companies from your investment fund or create a similar actively managed fund without such holdings. 11 Bid Requirements All securities shall be competitively bid where feasible and appropriate. Except as otherwise required by law, the most economically advantageous bid must be selected. Executions must be made on a best-execution basis. Investment Management Structure Five distinct asset classes will be considered for inclusion in the portfolio which will include Domestic Equities, International Equities, Domestic Fixed Income, Real Estate, and Alternative Investments. A permanent commitment to these five asset classes will be made to ensure diversification at the Fund level. The Fund may consider investments in other asset classes which offer potential enhancement to total return at risks no greater than the exposures under the initially selected asset classes. It is not the intention of the Fund to become involved in day-to-day investment decisions. Therefore, the assets will be allocated to professional investment managers in a manner consistent with the Policy's objectives. Each asset class will have its own investment managers. Diversification of the U.S. Market Equity commitment will be achieved through the employment of managers of complementary investment styles, Growth and Value. In the U.S. Fixed Income market, at least one core bond manager will be utilized to stabilize the Fund. In the International Equity market, diversified non-U.S. managers will be hired to achieve diversification. In the Real Estate market, the Fund will utilize collective funds or REIT’s for purposes of diversification. In the Alternatives market, the Fund will hire fund of funds managers to optimize strategies and provide adequate safety of capital and diversification. Cash and cash equivalents will be managed either by the Investment Managers or the custodian. In addition the City uses the pooling concept to meet the immediate cash needs of the city and to maximize the interest earnings. All cash placed in the City’s pooled cash account shall be separately accounted for and listed as an asset of the Fund. The Fund will keep sufficient funds in the City’s pooled cash account to meet the current obligations of the Fund. The guidelines for the allocation of assets, at market, to investment managers are as follows: Asset Class Lower Limit Upper Limit Market U.S. Market Equities Growth Value 20% 10% 10% 60% 30% 30% Market Market Market International Equity 10% 25% Market Domestic Fixed Income 25% 40% Market Real Estate 0% 15% Market Alternative Investments 0% 20% Market Because the asset classes do not move in concert, deviations from the normal commitments will occur through normal market activity. The Upper and Lower Limits define the ranges within which market activity will be allowed to shift the allocations. The ranges are designed to allow for a reasonable 12 period of time to elapse before rebalancing the portfolio. When the investments are out of policy the assets will be moved from the over-allocated to the under-allocated in a prudent manner. When in market equilibrium, cash flows will be deployed in a manner that returns the portfolio to its normal commitments. Internal Controls As part of the City’s annual financial audit the external CPA firm will review the internal controls of the Fund. The hiring or termination of all money managers, consultants or safekeeping custodians must be made by the trustees. No individual associated with the Fund may authorize any movement of monies or securities without the approval of the trustees, if required, or by the approval of the Pension Investment Committee if trustee approval is not required. Trustee approval is not required for rebalancing of the portfolio. Internal controls will be designed to prevent losses of funds which might arise from fraud, error, and misrepresentation by third parties or imprudent actions by the trustees or City employees. Investment Return Objectives In formulating investment return objectives for the Funds’ assets, the Fund placed primary emphasis on the following goals: y Achieve investment performance that exceeds the rate of inflation over time thereby providing a real rate of return. y Achieve investment results of at least the actuarial rate of return. y Achieve investment performance that is materially above average when compared to: - Other investment managers - Other investment manager peers of related investment style - Other public retirement plans - Several capital market indices y The Trustees will determine the expected rate of return of the current year, and future years. The expected rate of return for the foreseeable future is equivalent to the actuarial interest assumption at any point in time. The total Fund and asset segment return expectations are as follows: a. Total Fund Return Objectives The following minimum comparative objectives have been established for the total Fund: 1. The total fund should rank in the upper fiftieth (50th) percentile compared to a recognized performance measure company’s total public plan sponsor 13 database measured over a minimum period of three (3) or maximum five (5) years. 2. The Fund's overall annualized total return should perform at least at the upper fiftieth (50th) percentile compared to investment style peers of similar type as found in recognized performance measurement style database for each asset class segment. 3. The Fund's overall annualized total return (which is defined as all price changes plus all income and/or dividends) should exceed the actuarial assumption over a rolling three (3) or maximum of five (5) year period. 4. The Fund's overall annualized total return should exceed the returns that would have collectively been achieved if the Fund had been fully invested in the appropriate percentage of: - Standard & Poor's 500 Stock Index - Bloomberg Barclay’s Capital Aggregate Index - MSCI ACWI Ex USA This is a custom benchmark that will be calculated relative to the actual collective asset class mix of the Fund measured over a minimum of three (3) or maximum of five (5) years. b. Equity Segment Return Objectives The following minimum performance goals have been established for the Fund's domestic equity segment: 1. The domestic equity segment total return should perform at least at the upper fiftieth (50th) percentile compared to a recognized performance measurement company’s total U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 2. The individual domestic equity managers total return should perform at least at the upper fiftieth (50th) percentile compared to investment style peers of similar type as found in a recognized performance measure company’s total U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 3. The domestic equity segment total return should exceed the total return of the Standard & Poor's 500 Stock Index measured over a minimum period of three (3) or maximum of (5) years. c. International Equity Segment Return Objectives 14 The following minimum performance goals have been established for the Fund's international equity segment: 1. The international equity segment total return should perform at least at the upper fiftieth (50th) percentile compared to recognized performance measure company’s total non U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 2. The individual international equity managers total return should perform at least at the upper fiftieth (50th) percentile compared to the investment style peers of similar type as found in a recognized performance measure company’s total non U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 3. The international equity segment total return should exceed the total return of the Morgan Stanley Capital All Country World Index Ex United States measured over a minimum of three (3) or maximum of five (5) years. d. Fixed Income Segment Return Objectives . The following minimum performance goals have been established for the Fund's domestic fixed-income segment: 1. The domestic fixed-income segment total return should perform at least at the upper fiftieth (50th) percentile compared to the recognized performance measure company’s total domestic fixed income database measured over a minimum period of three (3) or maximum of five (5) years. 2. The individual domestic fixed income managers total return should perform at least at the upper fiftieth (50th) percentile compared to investment style peers of similar type as found in a recognized performance measure company’s total domestic fixed income database measured over a minimum period of three (3) or maximum of five (5) years. 3. The domestic fixed income segment total returns should exceed the total return of the Bloomberg Barclays Aggregate Bond Index measured over a minimum period of three (3) or maximum of five (5) years. e. Real Estate Segment Return Objectives The following minimum performance goals have been established for the Fund’s Real Estate Segment: 1. The Real Estate segment total return should perform at least at the upper fiftieth (50th) percentile compared to recognized performance measurement 15 database measured over a minimum period of three (3) or maximum of five (5) years. 2. The Real Estate managers total return should perform at least at the upper fiftieth (50th) percentile compared to the investment style peers of similar type as found in a recognized performance measurement company’s database measured over a minimum period of three (3) or maximum of five (5) years. 3. The Real Estate managers total return should exceed the total return for comparable strategies of the Wilshire RESI Index, the NCRIEF ODCE Fund Index or the NCRIEF Property Index over a minimum of three (3) or maximum of five (5) years. f. Alternative Segment Return Objectives The following minimum performance goals have been established for the Fund’s alternative investment segment. 1. The Alternative total return should perform at least at the upper fiftieth (50th) percentile compared to recognized performance measurement database measured over a minimum period of three (3) or maximum of five (5) years. 2. The alternative manager’s total return should perform at least at the upper fiftieth (50th) percentile compared to the investment style peers of similar type as found in a recognized performance measurement company’s database measured over a minimum period of three (3) or maximum of five (5) years. 3. The alternative manager’s total return should exceed the total return for comparable strategies of the alternative asset class’s specific recognized index measured over a minimum of three (3) or maximum of five (5) years. 4. The Investment Committee is aware that alternative investments may have unusual or inconsistent return patterns due to the liquidity and marketability, or lack thereof, of such investments. Occasions may arise where performance measurement devices appropriate for more liquid markets may not properly or fairly measure relative performance. In these situations, the Committee may overlook traditional measures and apply normal business standards for evaluating the investment positions including long term appreciation potential, current market liquidity, impacting macro- economic factors and potential future cash flows. 16 Criteria for Investment Manager Review and Manager Termination y Consistent under-performance of the stated target index over rolling 3-year periods. y Failure to out-perform the manager’s chosen performance benchmark or index measured over a minimum of three (3) years or maximum of five (5) years. y Failure to out-perform the manager’s investment style peer group measured over a minimum period of three (3) years or maximum of (5) years. y Loss by the Manager of any senior personnel deemed detrimental to the Manager’s ability to perform required duties or any potentially detrimental organizational issues that may arise and have an effect on the management of the Plan’s assets. y Substantial change in basic investment philosophy by the Manager. y Substantial change of ownership of the firm deemed detrimental to the Manager’s ability to perform the required duties. y Failure to observe any guidelines as stated in this policy. Evaluation and Review On a timely basis, but not less than four times a year, the Fund will review actual investment results achieved by each manager (with a perspective toward a five-year time horizon) to determine whether: y the investment managers performed in adherence to the investment philosophy and policy guidelines set forth herein; and y the investment managers performed satisfactorily when compared with: a. the objectives set forth in Appendix "A", as a primary consideration, b. their own previously stated investment style, c. other investment managers, both in asset class and in style group, d. other retirement funds, e. several different market indices. In addition to reviewing each investment manager's results, the Fund will re-evaluate, from time to time, its progress in achieving the total Fund, equity, fixed-income, international, and cash and equivalents segment objectives previously outlined. The periodic re-evaluation also will involve an 17 evaluation of the continued appropriateness of: (1) the manager structure set forth in Appendix "A"; (2) the allocation of assets among the managers; and (3) the investment objectives for the Fund's assets. The Fund may appoint investment consultants to assist in the on-going evaluation process. The consultants selected by the Fund are expected to be familiar with the investment practices of other similar retirement plans and will be responsible for suggesting appropriate changes in the Fund's investment program over time. Filing of Investment Policy Upon adoption by the trustees, the investment policy shall be promptly filed with the Department of Management Services, the City Clerk, and the consulting actuary. The effective date of changes to the Investment policy will be 31 days after the filing date with the city. APPENDIX A: 18 FUND SEGMENT AND INDIVIDUAL MANAGER GUIDELINES CITY OF CLEARWATER EMPLOYEES PENSION FUND INVESTMENT STRUCTURE Target Investment Manager Allocation Domestic Equity Value Orientation 10% - 30% Domestic Equity Growth Orientation 10% - 30% International Equity 10% - 25% Domestic Fixed Income 25% - 40% Real Estate 0% - 15% Alternative Investments 0% - 20% 19 APPENDIX A (continued): FUND SEGMENT AND INDIVIDUAL MANAGER GUIDELINES 1. Manager Structure The Fund will retain investment managers that specialize in the use of particular asset classes. The targeted distribution of Fund assets among specialist managers will be as illustrated on the previous page. The Fund believes that the established structure: y is consistent with the practices of other similar-sized retirement funds; and y offers an appropriate "blend" of investment styles that will produce a sufficient level of diversification and investment return over time. 2. Cash Flow Allocation The allocation of assets is consistent with the Fund’s desire to diversify its investment management program. The Fund intends to review on a periodic basis the allocation of assets among its investment managers. To the extent that it is practical, it is expected that any cash flow will be allocated to or taken from the managers in the same proportions that each manager's assets represent to total Fund assets in the target asset allocation outlined previously. 3. Trustee Utilization Restrictions All domestic Fund assets, in any form, shall be solely and exclusively: (a) settled at, (b) held in custody at, and (c) safe-kept only at custodians designated by the Fund at its sole discretion. International Fund assets may be held in commingled accounts provided that all of the normal protection of the Fund’s assets is provided for. 4. Transaction Agent Assignment Restrictions Assignment of specific brokerage firms, dealers, financial institutions, and other transaction execution agents to all investment managers shall be the sole responsibility of the Fund. From time to time, the Fund at its sole discretion may specify certain transaction agents that investment transactions shall be executed through. 5. Short Selling and Related Restrictions There shall be no: short selling, non-collateralized and/or non-delivered repurchase agreements, use of financial futures or options, non-marketable direct investments in equity or debt private placements or lease-backs or any other specialized investment activity without the prior written consent of the Fund. 20 6. Liquidity and Marketability Restrictions Liquidity and marketability frequently are perceived to be a function of the quality and the market capitalization of each security holding. From the Fund's perspective, liquidity and marketability also may be a function of a manager's aggregate holdings in a particular security. The Plan believes that an investment manager should not buy or hold a security for the Fund’s portfolio if the aggregate holdings among all of that manager's other accounts in that same security would restrict the manager's ability to expeditiously liquidate the position at any time. From a total Fund perspective, the Fund believes the collective holdings among all Fund managers’ accounts in that same security would restrict all managers’ collective ability to expeditiously liquidate their respective positions in that same security. Therefore, the Fund retains the sole right to limit any manager's holding of any security in the Fund at any time in order to prevent the potential for said Fund's collective liquidation and market risk. 7. Usage of Custodian STIF on all Idle Cash Restrictions Any idle cash not invested by the investment managers shall be invested daily via an automatic sweep STIF managed by the Custodian or by others in behalf of each investment manager. It is the Fund's objective to have no idle cash at any time in any manager's portfolios. 8. Usage of Cross Asset Segment Investment Guideline Restrictions When a manager's holdings include Fund assets outside of their primary assigned asset segment assignment (e.g. a primary domestic equity manager also holds some cash equivalents or fixed income securities as well as equities) the guidelines stated therein for the non primary asset segment shall fully apply to the manager, in addition to the primary asset assigned segment guidelines. 9. Diversification Restrictions Except for criteria noted elsewhere in this Policy and in specific written contracts with each manager, the appropriate and reasonable diversification of securities by such factors as geography, region, sovereign risk, native currency, quality, coupon, country risk, maturity, industry, duration, and sector is within the full discretion and responsibility of the investment managers. 10. Other Objectives, Guidelines and Restrictions Forthcoming The Fund may develop additional objectives, guidelines and restrictions and may amend the Policy from time to time. 21 11. Fund Segment Guidelines Following are guidelines and objectives established for the Fund segments and for each investment manager retained by the Fund. Individual manager guidelines are designed to be consistent, in aggregate, with the total Fund asset allocation guidelines and investment objectives set forth in the Statement of Investment Objectives and Guidelines. a. Domestic Equity Segment Each equity manager is expected to adhere to the following guidelines: y Equity holdings in any one company (including common and preferred stock, convertible securities and debt) should not exceed ten percent (10%) of the market value of the manager's portion of the Fund without the consent of the Fund. y Equity holdings in any one industry (as defined by Standard & Poor's) should not exceed fifty percent (50%) of the market value of the manager's portion of the Fund. y Cash equivalents and fixed income positions should not exceed twenty five percent (25%) of the manager's portfolio. A manager may invest in fixed income securities if projected returns on such securities are perceived to be competitive with potential equity returns. However, fixed income securities will not represent more than twenty-five percent (25%) of a manager's portfolio without the prior written consent of the Fund. y No purchase shall be made by an investment manager that would cause a holding to exceed five percent (5%) of the issue outstanding. b. International Equity Segment Each international equity manager is expected to adhere to the following minimum guidelines: y Equity holdings in any one company and all of its subsidiaries and affiliates (including equities, convertible securities and debt) should not exceed five percent (5%) of the market value of the manager's portion of the Fund portfolio without the prior written consent of the Fund. y Equity holdings in any one industry should not exceed fifty percent (50%) of the market value of the manager's portion of the Fund portfolio. Equity holdings in any one sector (e.g., consumer cyclical, energy, technology, etc.) should not exceed fifty percent (50%) of the market value of the manager's portfolio without the prior written consent of the Fund. 22 y Cash equivalents and fixed income positions should not exceed fifty percent (50%) of the manager's portion of the Fund assets. A manager may invest in fixed income securities (i.e. securities with more than two years to maturity) if projected returns on such securities are perceived to be competitive with potential equity returns. y The manager may enter into foreign exchange contracts on currency provided that: (a) such contracts have a maturity of one year or less, and (b) use of such contracts is limited solely and exclusively to hedging currency exposure existing within the manager's portfolio. The intent is to dampen portfolio volatility and prevent currency loss. There shall be no direct foreign currency speculation or any related investment activity. y The manager may purchase or sell currency on a spot basis to accommodate specific securities settlements. c. Fixed Income Segment Each fixed income manager is expected to adhere to the following guidelines: y All Fixed Income Securities held in each portfolio should have a Moody's, Fitch, or Standard & Poor's quality rating of no less than Investment Grade from any of these rating services. For an issue which is split-rated, the lower quality designation will govern. Once a security falls below investment grade the money manager will notify the plan of the downgrade as soon as practical. Included in that notification will be how the money manager will handle the below investment grade security. y The diversification of securities by maturity, quality, sector, coupon and geography is the responsibility of the manager. y The exposure of each manager's portfolio to any single security other than a security backed by the full faith and credit of the U.S. Government or any of its instrumentalities should be limited to five percent (5%) of the manager's portion of the Fund measured at market value. y No purchase shall be made by a Fixed Income Manager, which would cause a holding to exceed ten percent (10%) of the issue outstanding. y There shall be no use of options, financial futures, derivatives or other specialized investment activity without the prior written approval of the Fund. y Not more than ten percent (10%) of an investment manager's portfolio, valued at market, shall be invested in certificates of deposit, time deposits, bankers 23 acceptances, commercial paper, or related investments of a single issuer financial institution or financial institution holding company family. d. Real Estate Segment Each Real Estate manager is expected to adhere to the following guidelines: y REIT managers will limit holdings in any one company to fifteen percent (15%) of the market value of the manager’s Fund, cash equivalents and positions in fixed income vehicles should not exceed twenty five percent (25%) of the managers portfolio and no purchase shall be made that would cause a holding to exceed ten percent (10%) of the issues outstanding. y Managers of direct investments in real estate structured as limited partnerships, limited liability companies or separate accounts will operate strictly within conformance to the regulations of their state of domicile and comply with any applicable federal or state security laws. y Managers of direct investments in real estate may be income oriented or capital gains oriented but in no event will the manager apply average leverage in excess of fifty percent (50%) of the value of the total portfolio. y Managers of direct investments in real estate shall seek to diversify the portfolio in terms of geographic location, tenant usage, and lease schedules. y Timberland managers shall maintain portfolios of geographically diversified stands of biological tree growth with the potential for land value appreciation, alternative use and leasing potential, diversified product opportunities and long term land appreciation possibilities. e. Alternative Investment Segment Academic research supports the use of alternative investments as a mechanism to potentially reduce the volatility and/or enhance the expected return of an investment portfolio. However, the use of alternative investments can introduce unique types of risks due to their inherent structure and characteristics which include but are not limited to the following: leverage, illiquidity, short sales, derivatives, and lack of transparency and regulation. In light of these unique risks, the Fund does not attempt to define or limit the manager’s discretion as to the use of financial instruments. The Fund will actively monitor the investment manager’s performance and activities to limit exposure to these unique risks. f. Cash and Equivalents Segment Although investment managers will be retained for their expertise in a certain investment segment, it is expected that from time-to-time each will have some cash 24 and equivalents in their portfolios as a result of discretionary asset allocation decisions. Any idle cash not invested by the investment managers shall be invested daily via an automatic sweep STIF managed by the custodian. It is the Fund's objective to have no idle cash at any time in any manager's portfolio. g. Pooled Vehicles To the extent that the Fund invests a portion of the Fund’s assets in commingled vehicles or institutional mutual funds, then the investment guidelines of the fund's prospectus will be adopted as this fund's guidelines. h. Master Repurchase Agreement The money managers and safekeeping custodian will use a master repurchase agreement whenever appropriate. All repurchase agreements transactions shall adhere to the requirements of the master repurchase agreement. 12. Individual Manager Descriptions and Five-Year Expectations All expectations are minimums. All investment managers shall exceed the stated expectations. Investment Manager Percentile Expectation Relative To Other Managers Percentile Expectation Relative To Style Peers Domestic Equity Specialist Manager Value Orientation 50th 50th Domestic Equity Specialist Manager Growth Orientation 50th 50th International Equity Specialist Manager 50th 50th Domestic Fixed Income Specialist Manager Core Fixed Income Orientation 50th 50th Real Estate Specialist Manager 50th 50th Alternatives Specialist Manager 50th 50th 25 13. Reporting Requirements: a. Consultant Reporting The Pension Fund's Consultant will provide quarterly reports to the Pension Fund which, at a minimum, will review the following information about each Investment Manager and the total Fund: y Overview of the most recent quarter and year-to-date investment indicators y Total Fund asset allocation y Comparison of total Fund return versus the customized benchmark y Performance results by individual Manager and Total Fund compared to appropriate benchmarks. b. Investment Reporting: x On not less than an annual basis the Trustees will receive a report showing a list of all of the securities held by investment manager. This report will be provided by the safekeeping custodians and shall include the portfolio by class or type, book value, income earned, and market value as of the date of the report. This report will be filed with the City. c. Proxy Voting: x On not less than a quarterly basis, money managers will report to the Plan their proxy voting during the last period. 14. Review of Policy This Statement of Investment Policy must be reviewed annually by the Pension Investment Committee with a recommendation to revise or confirm to the Trustees. 15. Meeting Agenda At each meeting, the written and oral presentations shall cover the following points: y A report of performance for past periods. Standard time periods for each report will be last quarter, year-to-date, last year, two years, three years, etc., and since inception and by calendar year. Returns should be annualized and calculated on a time-weighted basis for the total portfolio. All returns should include price change plus income and/or dividends. 26 y Discussion of the rationale for performance results by relating them specifically to investment strategy and tactical decisions implemented during the current review period. y Discussion of the investment manager's specific strategy for the portfolio over the next six to twelve months with specific reference to asset allocation and sector weighting, as appropriate. y Supporting discussion of the next period's strategy with reference to investment manager's capital market and economic assumptions, if applicable. An electronic copy of the written summary should be received by the Fund at least three business days prior to the meeting. The Fund is interested in fostering an effective working relationship with its investment managers through a discipline of good communication. The establishment of Objectives, Performance Standards, Policies and Guidelines, and Reporting Requirements is intended to provide the Fund with a good foundation from which to understand specific management styles and strategies, evaluate results and oversee progress toward overall investment objectives. The Fund shall be using a third party consultant selected, hired and directed by the Fund to: (1) assist in appraising performance, (2) to provide performance comparison data with other retirement plans, several capital market indices, and to other investment managers, (3) assist in evaluating manager style discipline and peer comparisons, (4) assist in strategic Funding and management of the Fund, and (5) other factors the Fund deems appropriate. Investment managers are required to support and assist the consultant with their fullest cooperation. STATEMENT OF INVESTMENT OBJECTIVES AND GUIDELINES CITY OF CLEARWATER EMPLOYEES’ PENSION PLAN Approved by Trustees December 19, 2023 Effective January 19, 2024 1 Purpose The purpose of this Statement of Investment Objectives and Guidelines hereinafter referred to as the “Policy Statement” or “Policy” is to assist the City of Clearwater Employees’ Pension Plan (hereafter referred to as the fund) in more effectively supervising and monitoring the investment of the Fund's assets. In the various sections of this policy document, the Fund defines its investment program by: y stating in a written document the Fund's attitudes, expectations and objectives in the investment of Fund assets. y setting forth an investment "structure" for managing assets. This structure includes various asset classes and investment management styles that, in aggregate, are expected to produce a prudent level of diversification and investment return over time. y providing guidelines for each investment portfolio that control the level of risk assumed in the portfolio and ensure that assets are managed in accordance with stated objectives. y encouraging criteria to monitor and evaluate the performance results achieved by the investment managers. This Statement represents the Fund's current philosophy regarding the investment of Fund assets. In addition, although the Fund shall utilize this Policy Statement in making decisions concerning the Fund, it shall not necessarily be bound solely by its contents. Prudence and Ethical Standards The standard of prudence to be applied by the trustees shall be the "Prudent Person" rule, which states: "Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income derived." The "Prudent Person" rule shall be applied in the context of managing the overall portfolio. The trustees shall also be governed by the fiduciary standard set forth in the Employee Retirement Income Security Act of 1974 at 29U.S.C. s. 1104 (a) (1) (A) – (C). In the event of a conflict between the Policy and Florida Statutes or City ordinances, the statutes and ordinances shall prevail. Funding Philosophy The Fund's funding objectives are to be as fully funded as possible so that: y the ability to pay all benefits and expense obligations from the Fund when due is ensured; 2 y there will be no principal erosion of contributed funds or the purchasing power thereof. y a "funding cushion" is maintained within the Fund for unexpected developments and for possible future increases in benefit structure and expense levels; y the Fund assets should earn enough total rate of return over time to reduce the fund's dependency on employer contributions to meet all benefit and expense obligations. Investment results within the Fund are considered to be the major critical element in achieving these funding objectives stated above while reliance on contributions is a secondary element. Liquidity Posture The investment portfolio shall be structured in such a manner as to provide sufficient liquidity to pay obligations as they come due. Liquidity considerations are low in the short-term and intermediate term resulting in an immaterial impact upon investment policy, objectives and guidelines. Roles and Responsibilities Responsibilities of the Third-Party Custodian A third-party custodian will hold all Fund assets other than commingled accounts. In order to maximize the Fund's return, no money should be allowed to remain idle. Dividends, interest, proceeds from sales, new contributions and all other monies are to be invested or reinvested promptly. If funds are not reinvested, then they will be placed in money market instruments or a money market Fund immediately by the designated cash manager working in concert with the custodian. Security lending is permitted if the agreements meet the credit standards of the City of Clearwater and no credit exposure liability is taken to end user borrowers. The custodian will be responsible for performing the following functions: y Accept daily instructions from the investment managers; y Advise investment managers daily of changes in cash equivalent balances; y Immediately advise investment managers of additions or withdrawals from account; y Dispositions of holdings; y Resolve any problems that investment managers may have relating to custodial account; y Safekeeping of securities; 3 y Interest and dividend collection; y Daily cash sweep of idle principal and income cash balance; y Process all investment manager transactions on a delivery vs. payment basis; y Collect proceeds from maturing securities; y Provide monthly statements by investment manager account; y All securities purchased by the Fund shall be properly designated as an asset of the Fund; y No withdrawal of securities, in whole or in part shall be made except by an authorized member of the investment committee or the committee’s designee. Responsibilities of Investment Managers The duties and responsibilities of each of the registered investment advisors retained by the Fund include: y Managing the assets under its management in accordance with the policy guidelines and objectives expressed herein or expressed in a separate written agreement when deviation is deemed prudent and desirable. y Exercising full investment discretion within the guidelines and objectives stated herein. Such discretion includes decisions to buy, hold or sell securities in amounts and proportions reflective of the manager's current investment strategy and compatible with investment objectives. y Promptly informing the Fund regarding all significant matters pertaining to the investment of the Fund assets, for example: a. changes in investment strategy, portfolio structure and market value of managed assets; b. the manager's progress in meeting the investment objectives set forth in this document; and c. significant changes in the ownership, affiliations, organizational structure, financial condition, professional personnel staffing and clientele of the investment management organizations. No deviation from guidelines and objectives established in the Statement should occur until after such communication has occurred and the Fund has approved such deviation in writing. 4 y The Fund formally delegates full authority to each investment manager for exercising all proxy and related actions of the Fund’s investment assets assigned to it. Each manager shall promptly vote all proxies and related actions in a manner consistent with the long-term interests of the Fund and its Participants and Beneficiaries. Each investment manager shall keep detailed records of all said voting of proxies and related actions and will comply with all regulatory obligations related thereto. The Fund shall periodically audit and review each investment manager's policies and actions in this area. y Each Investment Manager shall utilize the same due care, skill, prudence and diligence under the circumstances then prevailing that experienced, investment professionals acting in a like capacity, as a fiduciary, and fully familiar with such matters would use in like activities for like Funds with like aims, while maintaining appropriate diversification to avoid the risks of large losses, in accordance and compliance with all applicable laws, rules and regulations from local, state, federal and international political entities as it pertains to fiduciary duties and responsibilities. y Notifying the Fund of the filing of a lawsuit by a client against the manager alleging breach of fiduciary duty or other willful conduct. Responsibilities of the Pension Investment Committee The Pension Investment Committee (Committee) shall consist (at a minimum) of the following: Finance Director (Treasurer for the Trustees), Assistant Finance Director, Finance Accounting Manager, Finance Debt Manager, and one member from the general public appointed by the Trustees. The Treasurer for the Trustees shall appoint/remove other City employees as needs warrant. One representative for each of the employee unions may also serve on the Investment Committee. The Finance Director or its designee will chair the Committee. A quorum of at least three (3) members must be physically present for all meetings. The Treasurer for the Trustees will make recommendations to the Trustees as to any changes in the makeup of the Committee. The Committee maintains the ultimate responsibility for approving the Investment Policy and managing the Investment Assets. The Plan has delegated to the Committee those responsibilities as defined below. x Oversee the management of the Fund’s assets. x Adopt, review and revise, as needed, an Investment Policy on an annual basis. x Recommend policy guidelines for the asset allocation of the Fund’s assets within the equity and fixed income segments according to investment style, taking into account near term cash needs and liquidity. x Recommend selection and retention or termination of all Investment Consultants, Investment Managers and Custodians. 5 x Review reports from outside professionals and the Investment Consultant on the status of the Fund’s assets. x Periodically measure and evaluate the investment performance of the Investment Managers against the established goals and objectives defined herein and in the Investment Manager’s agreement with the Committee and agreed upon rebalancing procedures for strategic asset allocation. On a periodic basis, in reference to the current liability obligation, an asset allocation study will occur. x Consider, revise and accept (or reject) recommendations made by the Investment Consultant regarding the management of the Fund Assets. x Control and account for all investment, recordkeeping and administrative expenses associated with the Fund’s assets. x Avoid prohibited transactions and conflicts of interest. x Apply the prudent person standard of care in the context of managing an overall portfolio. The annual budget for the Pension Fund will include sufficient funding for the trustees and members of the Pension Investment Committee to participate in pension education opportunities. These educational opportunities will include education on the individual’s duties and responsibilities as well as investments in general. The Finance Director, as Treasurer for the Trustees, will complete no less than eight (8) hours of continuing educational opportunities on pension investments each fiscal year. Responsibilities of the Investment Consultant x Serve as an objective, third party advisor to the Investment Committee. As such, the Investment Consultant will guide the Committee through a disciplined and rigorous process and may make recommendations to the Committee but will not have discretion to make investment or allocation decisions without their approval. x Assist in the development, implementation, review and monitoring of this Investment Policy. x Offer advice that is consistent with the investment objectives, policies, guidelines and constraints as established in this Investment Policy. x Conduct Investment Manager searches and fee negotiations when requested by the Investment Committee. x Provide research, analysis and general information about the Investment Managers. 6 x Measure, monitor and evaluate the investment performance and asset allocation of the Plan and report the findings to the Committee no less frequently than on a quarterly basis. x Periodically monitor the Investment Assets and provide reports to the Committee regarding investment performance and other pertinent information. x Apply the prudent person standard of care in the context of managing an overall portfolio. Compliance With Chapter 2023-28, Laws of Florida The Trustees and the investment managers shall comply with the applicable requirements of Chapter 2023-28, Laws of Florida, including Section 112.662, along with regulations adopted by the Department of Management Services. 1. Definition of pecuniary factor: The term “pecuniary factor” is defined as a factor that an investment fiduciary “prudently determines is expected to have a material effect on the risk or returns of an investment based on appropriate investment horizons consistent with the investment objectives and funding policy of the retirement system. The term does not include the consideration of the furtherance of any social, political, or ideological interests.” [112.662(1)] 2. Exclusive consideration of pecuniary factors: Only pecuniary factors may be considered, and the interests of the participants and beneficiaries of the system may not be subordinated to other objectives, including sacrificing investment return or undertaking additional investment risk to promote any nonpecuniary factor. The weight given to any pecuniary factor must appropriately reflect a prudent assessment of its impact on risk or returns. [112.662(2)] 3. Proxy voting: Only pecuniary factors may be considered when voting proxies. [112.662(3)] 4. Filing requirements: The Plan shall timely comply with the reporting requirement of Section 112.662 by filing a comprehensive report by December 15 of each odd-numbered year. [112.662(4)]. Investment manager’s and the Plan’s investment consultant shall assist in the preparation of the required reports and shall annually confirm to the Plan their compliance with Chapter 2023-28. 5. Contracting and external communication requirements: Manager contracts shall comply with Section 215.855 as follows: Any written communication made by an investment manager to a company in which such manager invests public funds on behalf of the Plan must include the following disclaimer in a conspicuous location if such communication discusses social, political, or ideological interests; subordinates the interests of the company’s shareholders to the interest of another entity; or advocates for he interest of an entity other than the company’s shareholders: The views and opinions expressed in this communication are those of the sender and do not reflect the views and opinions of the people of the State of Florida. 6. The Investment Consultant will provide Investment Managers for consideration who invest only based on pecuniary factors as defined by Florida Statutes §112.662. 7 7. If a Request for Proposals document is issued for Investment Manager services, the solicitation document must include the following: The Plan may not request documentation of or consider a vendor’s social, political, or ideological interests when determining if the vendor is a responsible vendor. Additionally, the Plan may not give preference to a vendor based on vendor’s social, political, or ideological interests. Authorized Investments The following is a list of authorized investments: y Invest and reinvest the assets of the pension fund in annuity (including group annuity contracts of the pension investment type) and life insurance contracts of legal reserve life insurance companies, in amounts sufficient to provide, in whole or in part, benefits to which all of the participants shall be or become entitled to under the provisions of the Fund, and pay the initial and subsequent premiums thereon. Provided that the amount invested with a life insurance company shall not exceed three percent (3%) of the insurance company’s assets. y Invest and reinvest the assets of the pension fund in: a. Time deposits, savings accounts, money market accounts, funds, certificates of deposits, or money market certificates of a national bank, a state bank, or a savings, building and loan association. b. Negotiable direct obligations of, or obligations the principal and interest of which are unconditionally guaranteed by, and which carry the full faith and credit of the United States Government and its agencies. Investments in this category would include but not be limited to the following: United States Treasury Bills, Notes and Bonds, and securities issued by the Small Business Administration, Government National Mortgage Association (Ginnie Mae), Veterans Administration, and Federal Housing Administration. c. Fully collateralized United States Agency obligations, which carry an implied guarantee and the implied full faith and credit of the United States government. Investments in this category would include but not be limited to the following: obligations of the Federal Home Loan Banks System (FHLB) or its distinct banks and Financing Corporation (FICO). d. Other United States Agency obligations, which carry an implied guarantee (Government Sponsored Entities) and the implied full faith and credit of the United States Government. Investments in this category would include but not be limited to the following: obligations of the Federal Farm Credit Bank, Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac), Financial Assistance Corporation and Federal Agriculture Mortgage Corporation (Farmer Mac). 8 e. Collateralized Mortgage Obligations (CMO) and/or Real Estate Mortgage Investment Conduits (REMIC), rated investment grade or equivalent by Standard and Poor's, Moody's, Fitch, or other recognized national rating agencies which are backed by securities otherwise authorized in this ordinance and which are guaranteed as to the timely payment of principal and interest by the U.S. Government or its agencies. f. Securities of countries, states, municipalities and county governments or their public agencies, which are, rated investment grade or equivalent by Standard and Poor's, Moody's, Fitch, or other recognized national rating agencies. g. Asset-backed securities, which are rated investment grade or equivalent by Standard and Poor's, Moody's, Fitch, or other recognized national rating agencies. h. Common stocks, preferred stocks and bonds and other evidence of indebtedness issued or guaranteed by a corporation organized under the laws of the United States, any state, or organized territory of the United States or the District of Columbia or any non-U.S. corporation, provided: 1. The corporation is listed on any one or more of the recognized national or international stock exchanges and/or in the case of bonds and mortgage backed securities, traded among dealers and investors in a recognized and agreed upon conventional format; 2. Unless an asset allocation for less than investment grade corporate bonds is established, all corporate bonds shall carry an investment grade rating as established either by Standard & Poor's, Moody's, Fitch or other recognized rating agencies; and 3. Not more than three percent (3%) of the equity assets of the pension Fund shall be invested in the common stock or capital stock of any one issuing corporation except to the extent a higher percentage of the same issue is included in a nationally recognized market index, based on market values, at least as broad as the Standard and Poor's Composite Index of 500 Companies, or except upon a specific finding by the investment committee that such higher percentage is in the best interest of the Fund; nor shall the non-U.S. investments exceed twenty five percent (25%) of the pension Fund's assets at market. i. Real estate including but not limited to REITS, comingled or limited partnerships. Investments in timber through vehicles such as comingled or limited partnerships shall be treated as a subclass of real estate. j. Alternative Investments, with no more, in the aggregate, than twenty percent (20%) of the Fund in alternative investments, through participation in securities or investments or an alternative investment vehicle that is not publicly traded and is not otherwise authorized by this section. Alternative Investments include securities which fall outside the scope of traditional investments (stocks, bonds, and cash) or are strategies investing in securities using alternative means (derivatives, leverage, short selling), or some combination thereof. 9 An “alternative investment vehicle" is a limited partnership, limited liability company, or similar legal structure or investment manager through which the fund invests in a portfolio company. Investments in public infrastructure projects will be considered an alternative investment. Real estate, including timber investments, are not considered alternative investments for this policy. Investments not listed above in this section are prohibited. Unauthorized Investments Effective July 1, 2009, Florida law was amended to require police and fire retirement plans to identify, publicly report and divest from investments in “scrutinized companies” as identified under Florida law. As a Florida Statute police and fire plan, the Trustees must follow this law. First, the System must identify its holding in “scrutinized companies.” 215.473(t) “Scrutinized Company” means any company that meets any of the following criteria: 1. The company has business operations that involve contracts with or provision of supplies or services to the government of Sudan, companies in which the government of Sudan has any direct or indirect equity share, consortiums or projects commissioned by the government of Sudan, or companies involved in consortiums or projects commissioned by the government of Sudan, and: a.) More than 10 percent of the company’s revenues or assets linked to Sudan involve oil-related activities or mineral-extraction activities; less than 75 percent of the company’s revenues or assets linked to Sudan involve contracts with or provision of oil-related or mineral- extracting products or services to the regional government of Southern Sudan or a project or consortium created exclusively by that regional government; and the company has failed to take substantial action; or b.) More than 10 percent of the company’s revenues or assets linked to Sudan involve power-production activities include projects whose intent is to provide power or electricity to the marginalized populations of Sudan; and the company has failed to take substantial action. 2. The company is complicit in the Darfur genocide. 3. The company supplies military equipment within Sudan, unless it clearly shows that the military equipment cannot be used to facilitate offensive military actions in Sudan or the company implements rigorous and verifiable safeguards to prevent use of that equipment by forces actively participating in armed conflict. Examples of safeguards include post-sale tracking of such equipment by the company, certification from a reputable 10 and objective third party that such equipment is not being used by a party participating in armed conflict in Sudan, or sale of such equipment solely to the regional government of southern Sudan or any internationally recognized peacekeeping force or humanitarian organization. 4. The company has business operations that involve contracts with or provision of supplies or services to the government of Iran, companies in which the government of Iran has any direct or indirect equity share, consortiums, or projects commissioned by the government of Iran and: a.) More than 10 percent of the company’s total revenues or assets are linked to Iran and involve oil-related activities or mineral- extraction activities; and the company has failed to take substantial action; or b.) The company has, with actual knowledge, on or after August 5, 1996, made an investment of $20 million or more, or any combination of investments of at least $10 million each, which in the aggregate equals or exceeds $20 million in any 12-month period, and which directly or significantly contributes to the enhancement of Iran’s ability to develop the petroleum resources of Iran. The definition of scrutinized company is detailed here for your information. However, to be compliant with the statutory requirements, the Investment Committee may look to the Florida State Board of Administration quarterly reports on identified scrutinized companies. Regular quarterly updates can be found at: http://www.sbafla.com/fsb/Home/tabid/369/Default.aspx. The Investment Committee must publicly report any direct or indirect holdings in scrutinized companies. As new companies are identified the Trustees’ must divest within 12 months of when the company was first added to the list. The Investment Committee’s third responsibility is one of two actions depending upon whether the holding is direct (securities are held directly by a public fund) or indirect (securities are held in an account or by a mutual fund in which the public fund owns shares or interests together with other investors not subject to the provisions of Florida Statutes §215.473.) If the holdings are direct, the law requires the Trustees’ to divest from its holdings. The divestiture must be completed by September 30, 2010. No further investments may be made in such companies. Private equity funds are deemed to be an actively managed investment fund. If the holdings are indirect, the Investment Committee must notify the investment manager of the companies on the list and request that the manager remove such companies from your investment fund or create a similar actively managed fund without such holdings. 11 Bid Requirements All securities shall be competitively bid where feasible and appropriate. Except as otherwise required by law, the most economically advantageous bid must be selected. Executions must be made on a best-execution basis. Investment Management Structure Five distinct asset classes will be considered for inclusion in the portfolio which will include Domestic Equities, International Equities, Domestic Fixed Income, Real Estate, and Alternative Investments. A permanent commitment to these five asset classes will be made to ensure diversification at the Fund level. The Fund may consider investments in other asset classes which offer potential enhancement to total return at risks no greater than the exposures under the initially selected asset classes. It is not the intention of the Fund to become involved in day-to-day investment decisions. Therefore, the assets will be allocated to professional investment managers in a manner consistent with the Policy's objectives. Each asset class will have its own investment managers. Diversification of the U.S. Market Equity commitment will be achieved through the employment of managers of complementary investment styles, Growth and Value. In the U.S. Fixed Income market, at least one core bond manager will be utilized to stabilize the Fund. In the International Equity market, diversified non-U.S. managers will be hired to achieve diversification. In the Real Estate market, the Fund will utilize collective funds or REIT’s for purposes of diversification. In the Alternatives market, the Fund will hire fund of funds managers to optimize strategies and provide adequate safety of capital and diversification. Cash and cash equivalents will be managed either by the Investment Managers or the custodian. In addition the City uses the pooling concept to meet the immediate cash needs of the city and to maximize the interest earnings. All cash placed in the City’s pooled cash account shall be separately accounted for and listed as an asset of the Fund. The Fund will keep sufficient funds in the City’s pooled cash account to meet the current obligations of the Fund. The guidelines for the allocation of assets, at market, to investment managers are as follows: Asset Class Lower Limit Upper Limit Market U.S. Market Equities Growth Value 20% 10% 10% 60% 30% 30% Market Market Market International Equity 10% 25% Market Domestic Fixed Income 25% 40% Market Real Estate 0% 15% Market Alternative Investments 0% 20% Market Because the asset classes do not move in concert, deviations from the normal commitments will occur through normal market activity. The Upper and Lower Limits define the ranges within which market activity will be allowed to shift the allocations. The ranges are designed to allow for a reasonable 12 period of time to elapse before rebalancing the portfolio. When the investments are out of policy the assets will be moved from the over-allocated to the under-allocated in a prudent manner. When in market equilibrium, cash flows will be deployed in a manner that returns the portfolio to its normal commitments. Internal Controls As part of the City’s annual financial audit the external CPA firm will review the internal controls of the Fund. The hiring or termination of all money managers, consultants or safekeeping custodians must be made by the trustees. No individual associated with the Fund may authorize any movement of monies or securities without the approval of the trustees, if required, or by the approval of the Pension Investment Committee if trustee approval is not required. Trustee approval is not required for rebalancing of the portfolio. Internal controls will be designed to prevent losses of funds which might arise from fraud, error, and misrepresentation by third parties or imprudent actions by the trustees or City employees. Investment Return Objectives In formulating investment return objectives for the Funds’ assets, the Fund placed primary emphasis on the following goals: y Achieve investment performance that exceeds the rate of inflation over time thereby providing a real rate of return. y Achieve investment results of at least the actuarial rate of return. y Achieve investment performance that is materially above average when compared to: - Other investment managers - Other investment manager peers of related investment style - Other public retirement plans - Several capital market indices y The Trustees will determine the expected rate of return of the current year, and future years. The expected rate of return for the foreseeable future is equivalent to the actuarial interest assumption at any point in time. The total Fund and asset segment return expectations are as follows: a. Total Fund Return Objectives The following minimum comparative objectives have been established for the total Fund: 1. The total fund should rank in the upper fiftieth (50th) percentile compared to a recognized performance measure company’s total public plan sponsor 13 database measured over a minimum period of three (3) or maximum five (5) years. 2. The Fund's overall annualized total return should perform at least at the upper fiftieth (50th) percentile compared to investment style peers of similar type as found in recognized performance measurement style database for each asset class segment. 3. The Fund's overall annualized total return (which is defined as all price changes plus all income and/or dividends) should exceed the actuarial assumption over a rolling three (3) or maximum of five (5) year period. 4. The Fund's overall annualized total return should exceed the returns that would have collectively been achieved if the Fund had been fully invested in the appropriate percentage of: - Standard & Poor's 500 Stock Index - Bloomberg Barclay’s Capital Aggregate Index - MSCI ACWI Ex USA This is a custom benchmark that will be calculated relative to the actual collective asset class mix of the Fund measured over a minimum of three (3) or maximum of five (5) years. b. Equity Segment Return Objectives The following minimum performance goals have been established for the Fund's domestic equity segment: 1. The domestic equity segment total return should perform at least at the upper fiftieth (50th) percentile compared to a recognized performance measurement company’s total U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 2. The individual domestic equity managers total return should perform at least at the upper fiftieth (50th) percentile compared to investment style peers of similar type as found in a recognized performance measure company’s total U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 3. The domestic equity segment total return should exceed the total return of the Standard & Poor's 500 Stock Index measured over a minimum period of three (3) or maximum of (5) years. c. International Equity Segment Return Objectives 14 The following minimum performance goals have been established for the Fund's international equity segment: 1. The international equity segment total return should perform at least at the upper fiftieth (50th) percentile compared to recognized performance measure company’s total non U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 2. The individual international equity managers total return should perform at least at the upper fiftieth (50th) percentile compared to the investment style peers of similar type as found in a recognized performance measure company’s total non U.S. equity database measured over a minimum period of three (3) or maximum of five (5) years. 3. The international equity segment total return should exceed the total return of the Morgan Stanley Capital All Country World Index Ex United States measured over a minimum of three (3) or maximum of five (5) years. d. Fixed Income Segment Return Objectives . The following minimum performance goals have been established for the Fund's domestic fixed-income segment: 1. The domestic fixed-income segment total return should perform at least at the upper fiftieth (50th) percentile compared to the recognized performance measure company’s total domestic fixed income database measured over a minimum period of three (3) or maximum of five (5) years. 2. The individual domestic fixed income managers total return should perform at least at the upper fiftieth (50th) percentile compared to investment style peers of similar type as found in a recognized performance measure company’s total domestic fixed income database measured over a minimum period of three (3) or maximum of five (5) years. 3. The domestic fixed income segment total returns should exceed the total return of the Bloomberg Barclays Aggregate Bond Index measured over a minimum period of three (3) or maximum of five (5) years. e. Real Estate Segment Return Objectives The following minimum performance goals have been established for the Fund’s Real Estate Segment: 1. The Real Estate segment total return should perform at least at the upper fiftieth (50th) percentile compared to recognized performance measurement 15 database measured over a minimum period of three (3) or maximum of five (5) years. 2. The Real Estate managers total return should perform at least at the upper fiftieth (50th) percentile compared to the investment style peers of similar type as found in a recognized performance measurement company’s database measured over a minimum period of three (3) or maximum of five (5) years. 3. The Real Estate managers total return should exceed the total return for comparable strategies of the Wilshire RESI Index, the NCRIEF ODCE Fund Index or the NCRIEF Property Index over a minimum of three (3) or maximum of five (5) years. f. Alternative Segment Return Objectives The following minimum performance goals have been established for the Fund’s alternative investment segment. 1. The Alternative total return should perform at least at the upper fiftieth (50th) percentile compared to recognized performance measurement database measured over a minimum period of three (3) or maximum of five (5) years. 2. The alternative manager’s total return should perform at least at the upper fiftieth (50th) percentile compared to the investment style peers of similar type as found in a recognized performance measurement company’s database measured over a minimum period of three (3) or maximum of five (5) years. 3. The alternative manager’s total return should exceed the total return for comparable strategies of the alternative asset class’s specific recognized index measured over a minimum of three (3) or maximum of five (5) years. 4. The Investment Committee is aware that alternative investments may have unusual or inconsistent return patterns due to the liquidity and marketability, or lack thereof, of such investments. Occasions may arise where performance measurement devices appropriate for more liquid markets may not properly or fairly measure relative performance. In these situations, the Committee may overlook traditional measures and apply normal business standards for evaluating the investment positions including long term appreciation potential, current market liquidity, impacting macro- economic factors and potential future cash flows. 16 Criteria for Investment Manager Review and Manager Termination y Consistent under-performance of the stated target index over rolling 3-year periods. y Failure to out-perform the manager’s chosen performance benchmark or index measured over a minimum of three (3) years or maximum of five (5) years. y Failure to out-perform the manager’s investment style peer group measured over a minimum period of three (3) years or maximum of (5) years. y Loss by the Manager of any senior personnel deemed detrimental to the Manager’s ability to perform required duties or any potentially detrimental organizational issues that may arise and have an effect on the management of the Plan’s assets. y Substantial change in basic investment philosophy by the Manager. y Substantial change of ownership of the firm deemed detrimental to the Manager’s ability to perform the required duties. y Failure to observe any guidelines as stated in this policy. Evaluation and Review On a timely basis, but not less than four times a year, the Fund will review actual investment results achieved by each manager (with a perspective toward a five-year time horizon) to determine whether: y the investment managers performed in adherence to the investment philosophy and policy guidelines set forth herein; and y the investment managers performed satisfactorily when compared with: a. the objectives set forth in Appendix "A", as a primary consideration, b. their own previously stated investment style, c. other investment managers, both in asset class and in style group, d. other retirement funds, e. several different market indices. In addition to reviewing each investment manager's results, the Fund will re-evaluate, from time to time, its progress in achieving the total Fund, equity, fixed-income, international, and cash and equivalents segment objectives previously outlined. The periodic re-evaluation also will involve an 17 evaluation of the continued appropriateness of: (1) the manager structure set forth in Appendix "A"; (2) the allocation of assets among the managers; and (3) the investment objectives for the Fund's assets. The Fund may appoint investment consultants to assist in the on-going evaluation process. The consultants selected by the Fund are expected to be familiar with the investment practices of other similar retirement plans and will be responsible for suggesting appropriate changes in the Fund's investment program over time. Filing of Investment Policy Upon adoption by the trustees, the investment policy shall be promptly filed with the Department of Management Services, the City Clerk, and the consulting actuary. The effective date of changes to the Investment policy will be 31 days after the filing date with the city. APPENDIX A: 18 FUND SEGMENT AND INDIVIDUAL MANAGER GUIDELINES CITY OF CLEARWATER EMPLOYEES PENSION FUND INVESTMENT STRUCTURE Target Investment Manager Allocation Domestic Equity Value Orientation 10% - 30% Domestic Equity Growth Orientation 10% - 30% International Equity 10% - 25% Domestic Fixed Income 25% - 40% Real Estate 0% - 15% Alternative Investments 0% - 20% 19 APPENDIX A (continued): FUND SEGMENT AND INDIVIDUAL MANAGER GUIDELINES 1. Manager Structure The Fund will retain investment managers that specialize in the use of particular asset classes. The targeted distribution of Fund assets among specialist managers will be as illustrated on the previous page. The Fund believes that the established structure: y is consistent with the practices of other similar-sized retirement funds; and y offers an appropriate "blend" of investment styles that will produce a sufficient level of diversification and investment return over time. 2. Cash Flow Allocation The allocation of assets is consistent with the Fund’s desire to diversify its investment management program. The Fund intends to review on a periodic basis the allocation of assets among its investment managers. To the extent that it is practical, it is expected that any cash flow will be allocated to or taken from the managers in the same proportions that each manager's assets represent to total Fund assets in the target asset allocation outlined previously. 3. Trustee Utilization Restrictions All domestic Fund assets, in any form, shall be solely and exclusively: (a) settled at, (b) held in custody at, and (c) safe-kept only at custodians designated by the Fund at its sole discretion. International Fund assets may be held in commingled accounts provided that all of the normal protection of the Fund’s assets is provided for. 4. Transaction Agent Assignment Restrictions Assignment of specific brokerage firms, dealers, financial institutions, and other transaction execution agents to all investment managers shall be the sole responsibility of the Fund. From time to time, the Fund at its sole discretion may specify certain transaction agents that investment transactions shall be executed through. 5. Short Selling and Related Restrictions There shall be no: short selling, non-collateralized and/or non-delivered repurchase agreements, use of financial futures or options, non-marketable direct investments in equity or debt private placements or lease-backs or any other specialized investment activity without the prior written consent of the Fund. 20 6. Liquidity and Marketability Restrictions Liquidity and marketability frequently are perceived to be a function of the quality and the market capitalization of each security holding. From the Fund's perspective, liquidity and marketability also may be a function of a manager's aggregate holdings in a particular security. The Plan believes that an investment manager should not buy or hold a security for the Fund’s portfolio if the aggregate holdings among all of that manager's other accounts in that same security would restrict the manager's ability to expeditiously liquidate the position at any time. From a total Fund perspective, the Fund believes the collective holdings among all Fund managers’ accounts in that same security would restrict all managers’ collective ability to expeditiously liquidate their respective positions in that same security. Therefore, the Fund retains the sole right to limit any manager's holding of any security in the Fund at any time in order to prevent the potential for said Fund's collective liquidation and market risk. 7. Usage of Custodian STIF on all Idle Cash Restrictions Any idle cash not invested by the investment managers shall be invested daily via an automatic sweep STIF managed by the Custodian or by others in behalf of each investment manager. It is the Fund's objective to have no idle cash at any time in any manager's portfolios. 8. Usage of Cross Asset Segment Investment Guideline Restrictions When a manager's holdings include Fund assets outside of their primary assigned asset segment assignment (e.g. a primary domestic equity manager also holds some cash equivalents or fixed income securities as well as equities) the guidelines stated therein for the non primary asset segment shall fully apply to the manager, in addition to the primary asset assigned segment guidelines. 9. Diversification Restrictions Except for criteria noted elsewhere in this Policy and in specific written contracts with each manager, the appropriate and reasonable diversification of securities by such factors as geography, region, sovereign risk, native currency, quality, coupon, country risk, maturity, industry, duration, and sector is within the full discretion and responsibility of the investment managers. 10. Other Objectives, Guidelines and Restrictions Forthcoming The Fund may develop additional objectives, guidelines and restrictions and may amend the Policy from time to time. 21 11. Fund Segment Guidelines Following are guidelines and objectives established for the Fund segments and for each investment manager retained by the Fund. Individual manager guidelines are designed to be consistent, in aggregate, with the total Fund asset allocation guidelines and investment objectives set forth in the Statement of Investment Objectives and Guidelines. a. Domestic Equity Segment Each equity manager is expected to adhere to the following guidelines: y Equity holdings in any one company (including common and preferred stock, convertible securities and debt) should not exceed ten percent (10%) of the market value of the manager's portion of the Fund without the consent of the Fund. y Equity holdings in any one industry (as defined by Standard & Poor's) should not exceed fifty percent (50%) of the market value of the manager's portion of the Fund. y Cash equivalents and fixed income positions should not exceed twenty five percent (25%) of the manager's portfolio. A manager may invest in fixed income securities if projected returns on such securities are perceived to be competitive with potential equity returns. However, fixed income securities will not represent more than twenty-five percent (25%) of a manager's portfolio without the prior written consent of the Fund. y No purchase shall be made by an investment manager that would cause a holding to exceed five percent (5%) of the issue outstanding. b. International Equity Segment Each international equity manager is expected to adhere to the following minimum guidelines: y Equity holdings in any one company and all of its subsidiaries and affiliates (including equities, convertible securities and debt) should not exceed five percent (5%) of the market value of the manager's portion of the Fund portfolio without the prior written consent of the Fund. y Equity holdings in any one industry should not exceed fifty percent (50%) of the market value of the manager's portion of the Fund portfolio. Equity holdings in any one sector (e.g., consumer cyclical, energy, technology, etc.) should not exceed fifty percent (50%) of the market value of the manager's portfolio without the prior written consent of the Fund. 22 y Cash equivalents and fixed income positions should not exceed fifty percent (50%) of the manager's portion of the Fund assets. A manager may invest in fixed income securities (i.e. securities with more than two years to maturity) if projected returns on such securities are perceived to be competitive with potential equity returns. y The manager may enter into foreign exchange contracts on currency provided that: (a) such contracts have a maturity of one year or less, and (b) use of such contracts is limited solely and exclusively to hedging currency exposure existing within the manager's portfolio. The intent is to dampen portfolio volatility and prevent currency loss. There shall be no direct foreign currency speculation or any related investment activity. y The manager may purchase or sell currency on a spot basis to accommodate specific securities settlements. c. Fixed Income Segment Each fixed income manager is expected to adhere to the following guidelines: y All Fixed Income Securities held in each portfolio should have a Moody's, Fitch, or Standard & Poor's quality rating of no less than Investment Grade from any of these rating services. For an issue which is split-rated, the lower quality designation will govern. Once a security falls below investment grade the money manager will notify the plan of the downgrade as soon as practical. Included in that notification will be how the money manager will handle the below investment grade security. y The diversification of securities by maturity, quality, sector, coupon and geography is the responsibility of the manager. y The exposure of each manager's portfolio to any single security other than a security backed by the full faith and credit of the U.S. Government or any of its instrumentalities should be limited to five percent (5%) of the manager's portion of the Fund measured at market value. y No purchase shall be made by a Fixed Income Manager, which would cause a holding to exceed ten percent (10%) of the issue outstanding. y There shall be no use of options, financial futures, derivatives or other specialized investment activity without the prior written approval of the Fund. y Not more than ten percent (10%) of an investment manager's portfolio, valued at market, shall be invested in certificates of deposit, time deposits, bankers 23 acceptances, commercial paper, or related investments of a single issuer financial institution or financial institution holding company family. d. Real Estate Segment Each Real Estate manager is expected to adhere to the following guidelines: y REIT managers will limit holdings in any one company to fifteen percent (15%) of the market value of the manager’s Fund, cash equivalents and positions in fixed income vehicles should not exceed twenty five percent (25%) of the managers portfolio and no purchase shall be made that would cause a holding to exceed ten percent (10%) of the issues outstanding. y Managers of direct investments in real estate structured as limited partnerships, limited liability companies or separate accounts will operate strictly within conformance to the regulations of their state of domicile and comply with any applicable federal or state security laws. y Managers of direct investments in real estate may be income oriented or capital gains oriented but in no event will the manager apply average leverage in excess of fifty percent (50%) of the value of the total portfolio. y Managers of direct investments in real estate shall seek to diversify the portfolio in terms of geographic location, tenant usage, and lease schedules. y Timberland managers shall maintain portfolios of geographically diversified stands of biological tree growth with the potential for land value appreciation, alternative use and leasing potential, diversified product opportunities and long term land appreciation possibilities. e. Alternative Investment Segment Academic research supports the use of alternative investments as a mechanism to potentially reduce the volatility and/or enhance the expected return of an investment portfolio. However, the use of alternative investments can introduce unique types of risks due to their inherent structure and characteristics which include but are not limited to the following: leverage, illiquidity, short sales, derivatives, and lack of transparency and regulation. In light of these unique risks, the Fund does not attempt to define or limit the manager’s discretion as to the use of financial instruments. The Fund will actively monitor the investment manager’s performance and activities to limit exposure to these unique risks. f. Cash and Equivalents Segment Although investment managers will be retained for their expertise in a certain investment segment, it is expected that from time-to-time each will have some cash 24 and equivalents in their portfolios as a result of discretionary asset allocation decisions. Any idle cash not invested by the investment managers shall be invested daily via an automatic sweep STIF managed by the custodian. It is the Fund's objective to have no idle cash at any time in any manager's portfolio. g. Pooled Vehicles To the extent that the Fund invests a portion of the Fund’s assets in commingled vehicles or institutional mutual funds, then the investment guidelines of the fund's prospectus will be adopted as this fund's guidelines. h. Master Repurchase Agreement The money managers and safekeeping custodian will use a master repurchase agreement whenever appropriate. All repurchase agreements transactions shall adhere to the requirements of the master repurchase agreement. 12. Individual Manager Descriptions and Five-Year Expectations All expectations are minimums. All investment managers shall exceed the stated expectations. Investment Manager Percentile Expectation Relative To Other Managers Percentile Expectation Relative To Style Peers Domestic Equity Specialist Manager Value Orientation 50th 50th Domestic Equity Specialist Manager Growth Orientation 50th 50th International Equity Specialist Manager 50th 50th Domestic Fixed Income Specialist Manager Core Fixed Income Orientation 50th 50th Real Estate Specialist Manager 50th 50th Alternatives Specialist Manager 50th 50th 25 13. Reporting Requirements: a. Consultant Reporting The Pension Fund's Consultant will provide quarterly reports to the Pension Fund which, at a minimum, will review the following information about each Investment Manager and the total Fund: y Overview of the most recent quarter and year-to-date investment indicators y Total Fund asset allocation y Comparison of total Fund return versus the customized benchmark y Performance results by individual Manager and Total Fund compared to appropriate benchmarks. b. Investment Reporting: x On not less than an annual basis the Trustees will receive a report showing a list of all of the securities held by investment manager. This report will be provided by the safekeeping custodians and shall include the portfolio by class or type, book value, income earned, and market value as of the date of the report. This report will be filed with the City. c. Proxy Voting: x On not less than a quarterly basis, money managers will report to the Plan their proxy voting during the last period. 14. Review of Policy This Statement of Investment Policy must be reviewed annually by the Pension Investment Committee with a recommendation to revise or confirm to the Trustees. 15. Meeting Agenda At each meeting, the written and oral presentations shall cover the following points: y A report of performance for past periods. Standard time periods for each report will be last quarter, year-to-date, last year, two years, three years, etc., and since inception and by calendar year. Returns should be annualized and calculated on a time-weighted basis for the total portfolio. All returns should include price change plus income and/or dividends. 26 y Discussion of the rationale for performance results by relating them specifically to investment strategy and tactical decisions implemented during the current review period. y Discussion of the investment manager's specific strategy for the portfolio over the next six to twelve months with specific reference to asset allocation and sector weighting, as appropriate. y Supporting discussion of the next period's strategy with reference to investment manager's capital market and economic assumptions, if applicable. An electronic copy of the written summary should be received by the Fund at least three business days prior to the meeting. The Fund is interested in fostering an effective working relationship with its investment managers through a discipline of good communication. The establishment of Objectives, Performance Standards, Policies and Guidelines, and Reporting Requirements is intended to provide the Fund with a good foundation from which to understand specific management styles and strategies, evaluate results and oversee progress toward overall investment objectives. The Fund shall be using a third party consultant selected, hired and directed by the Fund to: (1) assist in appraising performance, (2) to provide performance comparison data with other retirement plans, several capital market indices, and to other investment managers, (3) assist in evaluating manager style discipline and peer comparisons, (4) assist in strategic Funding and management of the Fund, and (5) other factors the Fund deems appropriate. Investment managers are required to support and assist the consultant with their fullest cooperation.