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Clermont Fire 08-25-2021 Quarterly Meeting Minutes signed�E f; MD D',C zoz) D �LERMONT Retirement Plan & Trust for Firefighters of the City of Clerm e t Minutes Quarterly Meeting August 25, 2021 IUD D 1. Chair Judd Lent called a Quarterly Meeting of the Firefighters Retirement Plan Board of Tr esW 0 1 -6UA order at 11:05 AM on November 20, 2020 in Council Chambers at the Clermont City Hall. Baur called roll on behalf of the Board. Those persons present included: By TRUSTEES OTHERS Judd Lent, Chair Scott Baur& AC Lovingood, Administrator (Resource Centers) Ryan Moore, Secretary Mitchell Brennan, Investment Consultant (BCA) Adam Watkins Bonni Jensen, Attorney (Klausner, Kaufman, Jensen, & Levinson) Judy Proli Chuck Carr, Actuary (Southern Actuarial Services) Nadine Ohlinger, HR Director Pam Brosonski, Finance Director 2. Extraordinary (Exigent) Circumstances for Trustees Joining Electronically Attorney Bonni Jensen reminded the Board that due to the extraordinary circumstances created by the pandemic; the Board can allow additional Trustees to join the meeting electronically. No Trustees joined the meeting electronically. 3. Approval of Minutes: The Trustees reviewed the Quarterly Board Meeting Minutes dated February 24, 2021, Special Board Meeting Minutes dated March 26, 2021, and the Quarterly Board Meeting Minutes dated May 26, 2021. Ryan Moore made a motion to approve the Quarterly Board Meeting Minutes dated February 24, 2021, Special Board Meeting Minutes dated March 26, 2021, and the Quarterly Board Meeting Minutes dated May 26, 2021, as presented. The motion received a second from Judd Lent, approved by the Trustees 3-0. Actuary Chuck Carr and Trustee Judy Proli joined the Board Meeting. The Trustees also reviewed the Warrant dated August 25, 2021, for payment of invoices. Judy Proli made a motion to approve the Warrant dated August 25, 2021, to pay expenses. The motion received a second from Ryan Moore, approved by the Trustees 4-0. 4. Reports Actuary Report (Chuck Carr. Southern Actuarial Servicesl Actuarial Valuation Reoort: Chuck Carr presented the Fire Board with the October 1, 2020, Actuarial Valuation. Mr. Carr explained that the Actuarial Valuation's purpose is to provide a summary of the funded status of the Plan and to determine the minimum required contribution under Chapter 112, Florida Statutes, for the 2020/2021 Plan year Mr. Carr reported that the minimum required contribution rate is 25,66% of covered payroll, which represents a decrease of 4 31%of payroll from the prior valuation. The normal cost rate is 24.77%, which is 4.17%lower than the normal cost rate that was developed in the prior valuation The sources of change in the normal cost rate were reviewed with the Board. Significantly, the ky J I G-. CLER (0 Retirement Plan & Trust for Firefighters of the City of Clermont Chace of Champons Minutes Quarterly Meeting August 25, 2021 rate decreased by 2.71% of payroll due to investment gains, decreased by another 2.75% of payroll due to demographic experience, and increased by 1.29% of payroll due to the assumption changes. The market value of assets earned 7.32% during the 2018/19 Plan year and earned 11.48% during the 2019/20 Plan year, whereas a 7.00% annual investment return was required to maintain a stable contribution rate. The Plan has a 128% market gain over a 10-Year Period, compared to the 7.00% Assumed Rate of Return, and a 7.40% average Assumed Rate of Return for that same period. Mr. Carr also noted that for the 2021/22, the City's required contribution rate will be 25.66% of covered payroll with the allowable Chapter 175 contribution offset. Based on the current assets, participant data, and actuarial assumptions and methods that are used in the value of the Plan, the present-day value of the total long-term funding requirement is $32,660,377. The current assets are sufficient to cover $22,771,575 of this amount, the employers 2020/21 expected contribution will cover $1,305,801 of this amount, and future employee contributions are expected to cover $1,374,717 of this amount, leaving $7,208,284 to be covered by future employer funding beyond the 2020-21 fiscal year. Mr. Carr reviewed the mortality table changes as required by Florida State Law along with the Full -Time versus Volunteer Firefighter demographic and statistical data, and current Plan Assumptions with the Board in detail. Mr. Carr informed the Board that his firm received the Acceptance Letter from the State and that the State approved the Actuarial Valuation; however, the State also attached an opinion provided by an outside actuary with the recommendation that the Board have the Assumed Rate of Return lowered. Mr. Carr informed the Board that he believes that the current Assumed Rate of Return is reasonable but also noted that the Pension Board is the one that sets the Assumed Rate of Return. Ryan Moore made a motion to approve the Actuarial Valuation Report as presented. The motion received a second from Judy Proli, approved by the Trustees 4-0. Adam Watkins made a motion upon the advice and recommendations of the Actuary and Investment Monitor that the Board expects to achieve an Assumed Rate of 7.00% for the next year, next several years, and for the long-term thereafter. The motion received a second from Ryan Moore, approved by the Trustees 4-0. GASB 67 & 68 Supplements: Mr. Carr informed the Board that the BASE 67 and 68 have been completed and copies have been sent to the City. Benefit Cost Studies: Mr. Carr informed the Board that the Benefit Cost Studies are in progress, noting that the COLA Studies are more complex and will take his firm a bit more time to complete. There was a discussion regarding pending purchase calculations, and it was noted that the costs will go down and that the current calculations would be out of date; however, the cost of benefit improvements will not change based on market performance of the assets. Mr. Carr also informed the Board that the Annual Benefit Statements have been produced and that the City has those statements to distribute out to the active members of the Plan. 6 . I.EROON Retirement Plan & Trust for Firefighters of the City of Clermont C T Chace of Champuris Minutes Quarterly Meeting August 25, 2021 Quarterly Investment Resort: Investment Consultant (Mitchell Brennan. Burgess Chambers & Assoc.1 Mitchell Brennan reported that for the quarter ending June 30, 2021, the beginning market value of the Plan was $28,514,695 with contributions totaling $388,448, gains totaling $1,508,142, which resulted in an ending Market Value of $30,411,285. For Fiscal Year -to -Date, the beginning market value of the Plan was $23,782,897 with contributions totaling $1,369,590, gains totaling $5,258,798, which resulted in an ending Market Value of $30,411,285. And for the Rolling One -Year, the beginning market value of the Plan was $21,913,828 with contributions totaling $1,889,045, gains totaling $6,608,413, which resulted in an ending Market Value of $30,411,285. Mr. Brennan then reported that the $1.5 million in earnings for the quarter equated to 5.3% gross and net, ahead of the target index rate of 5.0%. The total Fund ranked in the top 20% for the One-Yar period and the top 3% for the Three -Year Period. Mr. Brennan then reviewed the individual investments with the Board, stating that the Fidelity Large -Cap Growth Index was the best performer for the quarter, which was up 11.9%, The Fidelity Small -Cap Index was the best performer for the Fiscal Year -to -Date and the past year, up 54.3% and 62.0% prospectively. The Cohen & Steers Global Infrastructure product beat the benchmark for the quarter at 4.7%f, compared to t 3.1%, and the One -Year gains of 20.8% compared to 19.4%. The iShares Convertible Bonds ETF beat the benchmark for the quarter with returns at 7.1% compared to 5.6%, and the One -Year returns were at 40.5%, beating the benchmark rate of 36.3%. Mr. Brennan noted that this investment ranked in the top 241h and 37" percentiles, respectively. The PTEDEX Real Estate fund earned 4.0%, beating the benchmark rate of 3.9% for the quarter and the One-year returns were 2.2% compared to the 0.4% benchmark rate. The Vanguard Short -Term Corporate Bond returns for the quarter were 0.8% compared to the benchmark of 0.3% and the One -Year Return was 2.2%, beating the benchmark rate of 0.4%. Mr. Brennan informed the Board that in October of 2020, Salem Trust began the process of selling $1 million of the PREDEX Real Estate fund and as of April 23, 2021, $520,633 was sold, noting that this liquidation has been halted. Mr. Brennan then reviewed the Investment Policy Review with the Board, noting that all the investments are in compliance as this time. The investment allocations were then reviewed with Mr. Brennan noting that the Plan is overweight in equities and underweight in fixed income. He made a recommendation to take $1.2 million from cash and invest $150,000 in U.S. Bonds, $150,000 in the Vanguard Bond Fund, and $300,000 in the Salem Trust Bond Fund. Ryan Moore made a motion to approve the rebalancing of the Plan as recommended by the Investment Monitor. The motion received a second from Judy Proli, approved by the Trustees 4-0. Mr. Brennan stated that he will review some alternative asset choices and will discuss those options at the next Board Meeting along with the expected cash needs of the Plan. Attornev Report: Bonni Jensen (Klausner. Kaufman, Jensen & Levinsonj John Savelli Appeal: Attorney Bonni Jensen informed the Board that John Savelli has appealed the denial of his disability and that he stated that he will represent himself at the Formal Disability Hearing. Mrs. Jensen reminded the Board that they will need to hire an Attorney for this hearing and made a recommendation to use Attorney Mike Srebnick with the same terms that are in place with the Lawrence Crawford Appeal. S cLERWONT Retirement Plan & Trust for Firefighters of the City of Clermont ChateofChMinutes Quarterly Meeting August 25, 2021 Ryan Moore made a motion to hire Attorney Mike Srebnick to represent the Trustees for the John Savelli Formal Disability Hearing. The motion received a second from Judd Lent, approved by the Trustees 4-0. Lawrence Crawford Appeal: Ms. Jensen informed the Board that the Lawrence Crawford Formal Disability Hearing is ready to go. Mrs. Jensen reviewed the available dates and noted that she is looking into scheduling the Hearing in October. One witness has come forward regarding the Crawford Disability and Mrs. Jensen stated that the Board is able to take evidence from witnesses and used that information to make a decision. Administrator Report: Scott Baur and A.C. Lovinaood (Klausner. Kaufman. Jensen & Levinson) Resource Centers SOC1 Type 2 Audit Report: Administrator Scott Baur reviewed the current SOC 1 Type 2 audit report for the Resource Centers. The auditor did not find any exceptions to the stated controls and procedures in place at the plan administrator, which allows both auditors and plan administration clients of the firm to rely on accuracy of those controls and procedures. Mr. Baur explained the difference between a Type 1 SOC audit report, which states but does not test the controls and procedures, and a Type 2 SOC audit report, which fully tests all the internal controls in place. His firm has completed a Type 2 SOC audit now for 13 years. Conference List Update: Mr. Baur informed the Board that the 2021-22 Conference List is included in the Board Meeting Packets. 2022 Quarterly Meeting Schedule: Mr. Baur presented the Board with the 2022 Quarterly Meeting Schedule for review. The Board reviewed the schedule and had no objection to the dates. 5. Benefit Approvals 2019 & 2020 Chapter 175 Premium Tax Share Allocation: Mr. Baur presented the Board with the 2020 Chapter 175 Premium Tax Share Allocation. Mr. Baur noted that the Allocation sheet provided also includes the 2019 Share Allocations as well. The Board went over the Share Allocation worksheet with Mr. Baur. Ryan Moore made a motion to approve the 2019 & 2020 Chapter 175 Premium Tax Share Allocation as presented. The motion received a second from Judy Proli, approved by the Trustees 4-0. 6. Plan Financials Interim Financial Statement Dated July 31, 2021: Mr. Baur presented the Board with the July 31, 2021 Interim Financial Statement for informational purposes. Approval of Invoices, Warrant Dated August 25, 2021: Mr. Baur presented the Board with the Warrant Dated August 25, 2021, for review and approval. 6, LERWON Retirement Plan & Trust for Firefighters of the City of Clermont C T Choice f Ch Minutes Quarterly Meeting oampims August 25, 2021 Adam Watkins made a motion to approve the Warrant Dated August 25, 2021 as presented. The motion received a second from Ryan Moore approved by the Trustees 4-0. 7. Other Business There was no other business to discuss at this time. 8. Public Comment No members of the public had any comment. There being no further business and the next meeting having been previously scheduled for December 1, 2021 at 11:00 AM, the Chair adjourned the meeting at 12:39 PM. Respectfully Submitted, Adam Watkins, tart'