Book 1 Page 231 06-25-2021 8:15 a.m. MINUTES OF THE CITY OF SARASOTA POLICE OFFICERS' PENSION PLAN BOARD OF TRUSTEES REGULAR MEETING JUNE 25, 2021 Present: Chair Demetri Konstantopoulos, Secretary/Treasurer Shayla Griggs, Trustee Ronnie K. Baty, and Trustee Joseph Jody" Hudgins. Others: Attorney Scott Christiansen, Senior Pension Analyst Anthony Ferrer, and Pension Specialist Peter Gottlieb. Absent: Vice Chair Johnathan Todd. 1. CALL MEETING TO ORDER: Presenter(s): Chair Konstantopoulos. Chair Konstantopoulos called the meeting to order at 8:15 a.m. 2. PLEDGE OF CIVILITY: Presenter(s): Chair Konstantopoulos. Chair Konstantopoulos stated for the record, "We may disagree, but we will be respectful of one another. We will direct all comments to issues. We will not engage in personal attacks." 3. ROLL CALL: Presenter: Anthony Ferrer, Senior Pension Analyst. Senior Pension Analyst Ferrer called roll; and noted that Vice Chair Todd was absent and will request an excused absence at the next meeting. Trustee Hudgins requested an excused absence from the May 28, 2021, meeting. Trustee Baty made a motion to excuse Trustee Hudgins' absence; Secretary/Treasurer Griggs seconded the motion. The motion carried unanimously (4-0). 4. PUBLIC INPUT: None. 5. APPROVAL OF MINUTES: 5.1. Approval Re: Minutes of the Police Officers' Pension Plan Board of Trustees Regular Meeting of May 28, 2021. Presenter(s): Chair Konstantopoulos. Trustee Baty made a motion to approve the minutes of the May 28, 2021, meeting. Secretaryreasurer Griggs seconded the motion. The motion carried unanimously (4-0). The Board agreed by consensus to change the agenda order to allow item 8.1. to be presented next. 8. UNFINISHED BUSINESS: 8.1 Presentation and Discussion Re: BNY Mellon transfer to Newton Investment Management North America, LLC. Presenter(s): Larry Cole, Executive Vice President, Burgess Chambers & Associates Larry Cole of Burgess Chambers & Associates appeared before the Board telephonically and introduced himself. He thanked the Board for allowing this item to be presented out of order. Mr. Cole asked if there would be any issues reaching a quorum at the July 2021 meeting of the Board, as he has requested 2 prospective fund managers to present at that meeting. Trustee Hudgins confirmed he would not be present at the meeting; Senior Pension Analyst Ferrer stated Pension Administration would confirm with Vice Chair Todd regarding his availability and advise accordingly. Regarding the BNY Mellon transfer, Mr. Cole reviewed the changes to the addendum. He noted that, due to the percentage of the portfolio held, if BNY Mellon were to invest at the amended limits, the holdings would be less than 3% of the portfolio; Mr. Cole added that Burgess Chambers & Associates monitors each fund manager's asset allocation. He stated BNY Melion's requested changes were reasonable and minor. Attorney Christiansen stated he found no issues with the requested changes. Trustee Hudgins made a motion to approve BNY Mellon's addendum to their Investment Policy Statement; Trustee Baty seconded the motion. The motion carried unanimously (4-0). Mr. Cole noted that as of close of business on June 23, 2021, the portfolio balance was $323.203 million, which is up approximately 4%1 for the quarter-to-date, and 17% fiscal-year-to-date. He stated he would have a more detailed report at the July 2021 meeting. 6. RETIREMENT REQUESTS: None. 7. INVESTMENT PERFORMANCE REVIEW: 7.1. Presentation and Discussion Re: Capital GrouplAmerican Funds, Investment Performance Summary for Period Ending March 31, 2021. Presenter(s): Mark Seaman, Investment Director; Claudette Grant, Public Funds Relationship Manager, Capital Group/American Funds. Claudette Grant and Mark Seaman appeared before the Board telephonically and introduced themselves. Ms. Grant gave a brief overview of the presentation. Trustee Hudgins asked if the Board would prefer for Capital Group to focus their presentation on the fund performance; the Board agreed. Mr. Seaman directed the Board to page 13 of the presentation materials, and reviewed Strategy in focus and the Investment team. Regarding the Markets overview on page 16, he noted the US Dollar has been weaker compared to other currencies; Capital Group expects the Dollar to strengthen in the short term and Book 1 Page 232 06-25-2021 8:15 a.m. Book 1 Page 233 06-25-2021 8:15 a.m. revert to a weaker position in the long-term. This is important because currency conversions required for investors of US Dollars into foreign companies will likely have an adverse effect on performance for approximately the next year; he finished reviewing sector performance as stated on Markets overview on page 17. Mr. Seaman discussed Investment results, noting the Fund's 2020 performance, on a relative basis, was the second best in Capital Group's history; he attributed the returns to the performance of those companies which benefitted from the working and living arrangements due to COVID-19, such as e- commerce, entertainment, and communications sectors. Regarding total returns year-to-date, Mr. Seaman stated the portfolio is up approximately 6% and the benchmark is up approximately 9%. He attributed the underperformance to 2 separate issues, the first being those governments which had less-effective responses to COVID-19, such as India and Brazil, which has, in turn, impacted workers. The second driver of performance has been the healthcare sector, and he noted the significant recovery in the fund's performance during the last year. Mr. Seaman discussed the Portfolio characteristics, pointing out their low tumover rates and market capture ratios, the twenty largest equity holdings, and Sector diversification; regarding Geographic diversification, Mr. Seaman pointed out that nearly 50% of revenues are generated from emerging markets, irrespective ofv where companies are physically based. The Board thanked Mr. Seaman and Ms. Grant for their presentation. 7.2. Presentation and Discussion Re: Cohen & Steers, Investment Performance Summary as of May 31, 2021. Presenter(s): Evan Serton, Senior Vice President, Portfolio Specialist; Brian Casey, Vice President, Cohen & Steers. Brian Casey and Evan Serton appeared before the Board telephonically and introduced themselves. Chair Konstantopoulos asked Cohen & Steers to focus their comments on performance. Mr. Serton began the presentation on Global Listed Infrastructure Performance noting it has outperformed the index consistently since the fund's inception, Global Listed Infrastructure Performance Attribution elaborating on the greatest contributors and detractors to the fund's performance, and its Macro Outlook. He explained there are 31 themes in the portfolio: renewable energy, mobile data growth, and transportation, which are each respectively detailed on pages 11 through 13 of the presentation materials. Mr. Serton discussed inflation sensitivity and explained that the listed infrastructure asset class performs best when actual inflation exceeds market expectations, which Cohen & Steers believes will be what happens over the next few years. Mr. Serton reviewed the portfolio weights, noting biases towards leaders in renewable energy and away from toll roads and marine ports. The Board thanked Mr. Serton and Mr. Casey for their presentation. 7.3. Presentation and Discussion Re: Lazard Asset Management, Investment Performance Summary for Period Ending March 31, 2021. Presenter(s): Steven Keeler, Senior Vice President, Institutional Marketing, Lazard Asset Management. Steven Keeler appeared before the Board telephonically and introduced himself. Mr. Keeler explained Lazard's market outlook generally agrees with Cohen & Steers'. He explained their investment strategy and performance objectives and discussed Portfolio By Country and Sector, noting it has a well-diversified and global portfolio. Lazard anticipates European transportation companies to begin performing as lock-downs due to the COVID-19 pandemiç are lifted. Mr. Keeler discussed the Performance Summary and clarified that although it underperformed the benchmark in the last year, Lazard considers it a strong performance because it more than doubled its performance objective. He further attributed underpertormance relative to the benchmark because the benchmark gives more weight to energy which Lazard excludes, and the benchmark tends to be higher in the United States, which has done well compared . to Europe. He reviewed the Regional ContripuloryDetractors and Sector Contrlpulors/Detractors, and Inflation Protection Attributes of Preferred Infrastructure. Chair Konstantopoulos thanked Mr. Keeler for his presentation. 8. NEW BUSINESS: 9. ATTORNEY MATTERS: Attorney Christiansen noted that state financial disclosure forms willl be due July 1, and the State of Florida's website confirmed receipt of 4 of the 5 trustees' disclosures. He reminded the Board that officers must be selected in the July meeting, and requested those be added to that agenda. The Plan's controlling provisions require the Summary Plan Description to be updated and redistributed every 2 years; the last update was in September 2019. Trustee Hudgins made a motion to direct Attorney Christiansen to update the Summary Plan Description; Trustee Baty seconded the motion. The motion carried unanimously (4-0). State money should be received in late August and should be deposited into the pension fund within 5 days. All proposed state legislation which would have affected the Plan failed in committee. Attorney Christiansen attended first reading of Ordinance 21-5371; Secretary/Treasurer Griggs stated the second reading is scheduled for the first Commission meeting in July 2021. He reminded the Board a copy of the ordinance and a "no impact" letter must be sent to the State of Florida before the second reading. Attorney Christiansen requested a copy of the ordinance upon adoption. In the Van Gostein matter, Attorney Christiansen and opposing counsel have requested a status conference with the judge to be held on July 7 regarding Mr. Van Gostein's motion for rehearing. If Mr. Van Gostein's motion is denied, it could be appealed to district court. 10. OTHER MATTERS: Senior Pension Analyst Ferrer advised that Vice Chair Todd will attend the July 23, 2021 meeting. 11. ADJORN. Chair Konstantopoulos adjourned the meeting at 9:00 a.m. - - A / 1C : Chairt Demetri Konstantopoulos Secrelayfpéasurert GriggEl Book 1 Page 234 06-25-2021 8:15 a.m.