MINUTES OF THE CITY OF SARASOTA POLICE OFFICERS' PENSION PLAN BOARD OF TRUSTEES REGULAR MEETING OF MAY 26, 2023 Present: Chair Demetri Konstantopoulos, Secrelary/Treasurer Shayla Griggs, and Trustee Ronnie K. Baty. Others: Attorney Scott Christiansen, Pension Plans Administrator Debra Martin, and Pension Specialist Peter Gottlieb. Absent: Vice Chair Johnathan Todd, Trustee Joseph Jody" Hudgins. 1. CALL MEETING TO ORDER: Presenter(s): Chair Konstantopoulos. Chair Konstantopoulos called the regular meeting of the Poliçe Officers' Pension Plan (Plan) Board of Trustees to order at 8:15 a.m. 2. PLEDGE OF ALLEGIANCE: Presenter(s): Chair Konstantopoulos. Chair Konstantopoulos led the Board and those in attendance in the Pledge of Allegiance. 3. 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. 4. ROLL CALL: Presenter: Pension Plans Administrator Martin. Pension Plans Administrator Martin called roll. Vice Chair Todd and Trustee Hudgins were not present. 5. PUBLIC INPUT: None. 6. APPROVAL OF MINUTES: 6.1. Approval Re: Minutes of the Police Officers' Pension Plan Board of Trustees Regular Meeting of April 28, 2023. Presenter(s): Chair Konstantopoulos. Trustee Baty made a motion to approve the minutes of the Regular Meeting of April 28, 2023; Secretary/Treasurer Griggs seconded the motion. The motion passed unanimously (3-0). 7. RETIREMENT REQUESTS: Book 1 Page 348 05-26-2023 8:15 a.m. Book 1 Page 349 05-26-2023 8:15 a.m. 7.1. Approval Re: DROP Retirement Request of Anthony Frangioni. Presenter(s): Debra Martin, Pension Plans Administrator. Pension Plans Administrator Martin advised that Anthony Frangioni requests to enter the DROP at age 50 with 25 years of service on May 1, 2023; he selected the 50% to joint annuitant option. Secretary/Treasurer Griggs made a motion to accept Anthony Frangioni's request to enter the DROP; Trustee Baty seconded the motion. The motion passed unanimously (3-0). 7.2. Presentation and Discussion Re: DROP Retirement Request Jeffrey Ball. Presenter(s): Debra Martin, Pension Plans Administrator. Pension Plans Administrator Martin advised that Jeffrey Ball request to enter the DROP at age 58 with 15.68 years of service on April 1, 2023; he selected the 67% to joint annuitant option. Secretary/Treasurer Griggs made a motion to accept Jeffrey Ball's request to enter the DROP; Trustee Baty seconded the motion. The motion passed unanimously (3-0). 8. INVESTMENT PERFORMANCE REVIEW: 8.1. Presentation and Discussion Re: Frontier Capital, Investment Performance Summary for Period Ending March 31, 2023. Presenter(s): Rushan (Greg) Jiang, FA, Portfolio Manager, Frontier Small Cap Value Portfolios; Leigh Anne Yoo, Director of Sales and Marketing; Greg Mulready, Head of Sales and Marketing; Frontier Capital (Telephonic). Leigh. Anne Yoo, Rushan Jiang, and Greg Mulready of Frontier Capital (Frontier) appeared before the Board telephonically and introduced themselves. Ms. Yoo advised there have been no changes in the firm or strategy; she noted she will retire in August 2023 and be replaced by Mr. Mulready. She reviewed the Frontier Overview page of the presentation materials and the strategies offered by Frontier. Mr. Jiang reviewed the Portfolio Performance page of the materials, noting Frontier's excess positive returns are largely attributable to stock selection. The Attribution Analysis on the Equity Attribution - Trailing 1 Year states that 2.8% of its outperformance relative to the benchmark was due to allocation and 9.4% due to stock selection. Mr. Jiang discussed the Top 5 Contributors and Bottom 5 Detractors from performance. Regarding Frontier's regional bank holdings, Mr. Jiang explained the portfolio was underweight in that sector prior to March 2023 due to concerns of declining net interest margins and increased credit losses. He explained why Frontier has confidence in the regional banks in the portfolio. The regional banks in Frontier's portfolio have less uninsured deposits and less unrealized losses than the regional banks which failed in Q1 and Q2 2023 and Frontier regularly stress-tests the banks in its portfolio. Further, the banks in the portfolio do not have concentrations in venture capital or cryptocurrencies. As of the end of Q1 2023, the banks in Frontier's portfolio have seen only a slight, or no loss of deposits. While valuations in this sector are currently attractive, Frontier is waiting for valuations to come down more before they add to its position. Mr. Jiang discussed the Portfolio Composition; while the turnover rate is normal, its 5% cash position is unusually high because 5 of the companies in the portfolio were taken over or acquired by other firms during 2023. Frontier expects to bring its cash position down to 3% over time. He reviewed the Russell ICP Industry Weights graph. On the page titled Portfolio Activity = 1 Q23, Mr. Jiang noted that 4 of the 5 stocks Frontier sold were companies which had been taken over or acquired. The page titled Long Term Equity Attribution details how Frontier's stock selection led to its long-term outperformance. The Board had no questions for Mr. Jiang or Ms. Yoo and thanked them for their presentation. 8.2. Presentation and Discussion Re: Burgess Chambers & Associates, Quarterly Investment Performance Review for Period Ending March 31, 2023. Presenter(s): Larry M. Cole, Executive Vice President, Burgess Chambers & Associates. Chair Konstantopoulos advised that Mr. Cole will present a quarterly update to the Board at its June 23, 2023 meeting. 9. UNFINISHED BUSINESS: None. 10. NEW BUSINESS: None. 11. ATTORNEY MATTERS: 11.1. Presentation and Discussion Re: Ordinance Amending Pension Plan. Presenter(s): Scott Christiansen, Christiansen & Dehner, P.A. Attorney Christiansen reviewed the proposed changes to City Ordinances, which are, in part, in response to the Secure Act 2.0. Section 24-61 clarifies the existing definition of Salary to accommodate participants who work less than 12 months during a fiscal year in their final year of service. Section 24-65 allows the Board greater discretion regarding the recovery of overpayments. Section 24-81 addresses changes to the age when Required Minimum Distributions (RMDs) as stated in the Internal Revenue Service (IRS) Code must begin; the Secure Act 2.0 increased the age at which participants must begin to take RMDs to 73, and again increases it in 10 years to age 75. Section 24-93 clarifies provisions regarding Chapter 185 Premium Tax Revenues to state that Police Officers who receive Share Plan distributions are not eligible to receive refunds of their employee contributions; similarly, Police Officers who receive refunds of employee contributions forfeit their Share Plan balance. Trustee Baty made a motion to approve the proposed ordinance as presented by Attorney Christiansen; Secretary/Treasurer Griggs seconded the motion. The motion passed unanimously (3-0). Attorney Christiansen noted Gabriel, Roeder and Smith, the Plan's actuary, has already issued a letter advising there is no cost associated with the proposed changes to Ordinances. He added that he would forward to Pension Administration a clean copy of the proposed ordinance and accompanying letter to submit to the City Commission. 11.2. Presentation and Discussion Re: Proposed Addendum to Operating Rules regarding 2.1. Attendance at Board Meetings. Presenter(s): Scott Christiansen, Christiansen & Dehner, P.A. Attorney Christiansen explained that the proposed Addendum to the Operating Rules allows a Trustee to appear and participate in a Board Meeting telephonically after a physical quorum is established at that meeting and the Board determines the trustee is experiencing extraordinary circumstances which preclude their in-person attendance at that meeting. Attorney Christiansen noted that the sentence, Trustees are encouraged to notify the Board in advance, of possible," should read, Trustees are encouraged to notify the Board in advance, if possible, and that he would forward a corrected copy to Pension Administration. Book 1 Page 350 05-26-2023 8:15 a.m. Book 1 Page 351 05-26-2023 8:15 a.m. Trustee Baty made a motion to approve the revision to Rule 2.1. of the Operating Rules; Secretary/Treasurer Griggs seconded the motion. The motion passed unanimously (3-0). Attorney Christiansen reminded trustees to submit their Form 1 by July 1, 2023. Attorney Christiansen discussed changes in the Florida Retirement System (FRS). The FRS extended the time all participants may be in the DROP from 5 years to 8 years; previously, only law enforcement officers could remain in the DROP for 8 years. The FRS increased its payment for each year of credited service towards a health insurance supplement premium from $5.00 per year to $7.50 per year. The FRS also reduced the number of years of service required for a normal retirement from 30 years to 25 years. He noted these are presented to the Board for its information. To Chair Konstantopoulos question, Attorney Christiansen advised that several of his clients adopted some of FRS's changes to their respective plans, especially the 8-year DROP period. 12. OTHER MATTERS: 12.1. Presentation and Discussion Re: Administrative Budget Analysis for the Period January 1, 2023 through March 31, 2023. Presenter(s): Debra Martin, Pension Plans Administrator. Pension Plans Administrator Martin presented the Administrative Budget Analysis for the Period January 1, 2023 through March 31, 2023. She noted the items which are 100% or 0% expended are due to timing. She anticipates having to request at a future meeting, an increase for Salaries due to the City's wage increase in October 2022; she will not request it now as Salaries are only 53% expended as of this Budget Analysis. 12.2. Presentation and Discussion Re: Check Register for the Period January 1, 2023 through March 31, 2023. Presenter(s): Debra Martin, Pension Plans Administrator. Pension Plans Administrator Martin presented the Check Register for the Period January 1, 2023 through March 31, 2023. Payments to individuals are for DROP distributions, refund of contributions, or reimbursements to trustees for incurred travel expenses. Payments to the City of Sarasota GE Pension Fund and City of Sarasota FF Pension Fund are reimbursements of payments for items shared between the City's defined benefit pension plans. ADJOURN. Chair Konstantopoulos adjourned the meeting at 8:47 a.m. 6 Ghair Démetri Konstantopoulos SecretalyTreasurer ShaylaGriggs