MINUTES OF THE CITY OF SARASOTA GENERAL EMPLOYEES PENSION PLAN BOARD OF TRUSTEES REGULAR MEETING OF FEBRUARY 8, 2021. Present: Chair Ryan Chapdelain, Vice Chair Susan Blake, Secretary Shayla Griggs, Treasurer Kelly Strickland, Trustee Robert Reardon, Trustee Mark Nicholas. Others: Attorney Scott Christiansen, Pension Plans Administrator Debra Martin, Senior Pension Analyst Anthony Ferrer. Absent: Trustee Kari McVaugh. 1. CALL MEETING TO ORDER: Chair Chapdelain called the meeting to order at 8:30 a.m. 2. PLEDGE OF CIVILITY: Chair Chapdelain stated for the record, "We may disagree, but we will always be respectful to one another. We will direct all comments to issues, and we will not engage in personal attacks." 3. ROLL CALL: Pension Plans Administrator Martin called roll. Chair Chapdelain, Secretary Griggs, Treasurer Strickland, Trustee Reardon, and Trustee Nicholas appeared in person; Vice Chair Blake appeared telephonically. Pension Plans Administrator Martin stated that Trustee McVaugh would request an excused absence at the next meeting. Also in person was Attorney Christiansen and Senior Pension Analyst Ferrer. Pension Plans Administrator Martin appeared telephonically. Treasurer Strickland made a motion to acknowledge extraordinary cirçumstances exist which allow Vice Chair Blake to participate remotely. Trustee Nicholas seconded the motion. The motion carried unanimously (6-0). 4. PUBLIC INPUT: None 5. APPROVAL OF THE MINUTES: 5.1. Approval Re: Minutes of the General Employees Pension Plan Board of Trustees Regular Meeting of January 22, 2021. Presenter(s): Chair Chapdelain. Vice Chair Blake made a motion to accept the minutes of the meeting of January 22, 2021; Treasurer Strickland seconded the motion. The motion passed unanimously (6-0). 6. APPROVAL OF RETIREMENT REQUESTIS): Book 1 Page 240 02-08-2021 10:00 a.m. 6.1. Approval Re: DROP Retirement Request of Kathy King. Presenter(s): Debra Martin, Pension Plans Administrator. Pension Plans Administrator Martin stated that Ms. King requested a normal DROP retirement after 14.5 years of service. Ms. King selected the lifetime only option. Vice Chair Blake made a motion to approve Ms. King's retirement request. Trustee Nicholas seconded the motion. The motion carried unanimously (6-0). 6.2. Approval Re: DROP Retirement Request of Johnny Hart. Presenter(s): Debra Martin, Pension Plans Administrator. Pension Plans Administrator Martin stated that Mr. Hart requested a normal DROP retirement program after 20.45 years of service. Mr. Hart selected the lifetime only option. Vice Chair Blake made a motion to approve Mr. Hart's retirement request. Trustee Nicholas seconded the motion. The motion carried unanimously (6-0). 7. INVESTMENT PERFORMANCE REVIEW: None 8. UNFINISHED BUSINESS: None 9. NEW BUSINESS: 9.1. Presentation and Discussion Re: Mauldin & Jenkins, Independent Auditors Report for the Fiscal Years ending September 30, 2020 and 2019. Presenter(s): Alison Wester, CPA, Partner, Mauldin & Jenkins. Alison Wester of Mauldin & Jenkins appeared before the Board telephonically and introduced herself. Ms. Wester discussed the independent auditor's report, stating this is the first year the report is presented on a comparative basis, which was requested by the Board at a previous meeting. She stated the auditor's opinion was clean and unmodified, presented fairly, and only represents the position of the Plan and not the City of Sarasota. Ms. Wester gave an overview of the Management Discussion and Analysis, including the Financial Highlights, Financial Statements, Statements of Fiduciary Net Position and Statements of Changes in Fiduciary Net Position, noting an increase in Pension net position in 2020 in the amount of $1.7 million compared to a decrease in 2019 which was a result of investment returns. She reviewed Note 1, Summary of Significant Accounting Policies, including Basis of Accounting, Reporting Entity, and Financial Statement Presentation; she clarified the Estimates are a part of the financial statements. Ms. Wester explained Note 2, Plan Description and Contribution Information, includes comments on Plan Administration, Membership, Benefits Provided, and Contributions; Note 3 discusses the DROP; Note 4 is the Cash, Cash Equivalent and Investments which discusses Investment Policy, Rate of Return, Interest Rate Risk, Custodial Credit Risk, Concentration of Credit Risk, and Credit Risk, Foreign Credit Risk. Regarding Fair Value Measurements, Ms. Wester noted Level 1 investments are valued as identical instruments in an actively traded market; Level 2 investments are valued as similar instruments in an actively traded market; and Level 3 are all other items; she stated the real estate funds are valued at net asset Book 1 Page 241 02-08-2021 10:00 a.m. Book 1 Page 242 02-08-2021 10:00 a.m. value. Note 5 is the Net Pension Liability using information received from Gabriel Roeder & Smith, noting for 2020, the Pension Liability is $57 million compared to $55 million in 2019, and referenced the actuarial assumptions included in the valuation. She reviewed the Sensitivity of the Net Pension Liability to Changes in the Discount Rate. Ms. Wester reviewed Note 6, Risk and Uncertainties, and Note 7, Subsequent Events. Ms. Wester discussed the Schedule of Changes in Net Pension Liability and Related Ratios noting that when completed, this table, as well as the Schedule of Contributions and Annual Money-Weighted Rate of Return, Net of Investment Expense, will each contain 10 years of information. Ms. Wester concluded her discussion of the Financial Statement by reviewing the internal controls over financial reporting and on compliance matters. The Board had no questions for Ms. Wester regarding the Financial Statements, and thanked Ms. Wester for her report and efforts. Treasurer Strickland made a motion to accept Mauldin & Jenkins' Audit Report for the Plan; Trustee Nicholas seconded the motion. The motion carried unanimously (6-0). Ms. Wester presented the Auditors Discussion and Analysis (AD&A). She noted there were no significant difficulties or disagreements in performing the audit, nor were there any audit adjustments or prior period adjustments. 10. ATTORNEY MATTERS: 10.1. Presentation and Discussion Re: Christiansen & Dehner, Revision to Summary Plan Description. Presenter(s): Scott Christiansen, Christiansen & Dehner, P.A. Attorney Christiansen reviewed the updates and changes to the SPD. Language was changed in the "re- employment after retirement" section regarding a participant's age; in Claims Procedure Before the Board, the amount of time allowed for the Board to return a decision in a disability item was extended from 90 to 180 days to match the operating rules; in the section addressing ex-spouses as beneficiary or joint pensioner, language was added to allow additional exceptions to allow a spouse at the time of retirement who divorces a pension recipient to remain a beneficiary or joint pensioner; the list of trustees and officers was updated; and actuarial valuation highlights was updated to reflect the most recent actuarial valuation. Attorey Christiansen stated that once the Board approves the updated SPD, it should be distributed to the active Plan members; it would not need to be approved by the City Commission. Vice Chair Blake stated, regarding item 26, she believed she had been elected to Seat 1 and Trustee Nicholas was elected to Seat 4. A brief discussion ensued regarding the history of the seat numbers. Pension Plans Administrator Martin stated Pension Administration would research the issue. Attorney Christiansen suggested the Board could propose a motion to approve the revisions to the SPD, subject to confirmation of the correct trustee seats in the item. Trustee Nicholas made a motion as stated by Attomey Christiansen; Vice Chair Blake seconded the motion. The motion carried unanimously (6-0). Attorney Christiansen asked if the ordinance had been adopted and transmitted to the State of Florida. Secretary Griggs stated that it has been signed. Attorney Christiansen requested a copy of the executed ordinance. Attorney Christiansen advised State legislation has been pre-filed which could require appointed public officials to receive 5 hours of additional training in board governance and fiduciary responsibility; this is similar, if not identical, to previously proposed legislation which had failed to be adopted in a previous year. The training would be offered in virtual format; existing trustees would have 180 days to complete the training and new trustees would be required to complete the training within 90 days of appointment. Attorney Christiansen noted the legislation refers to, appointed trustees, but does not clarify if there is a difference between appointed trustees and those who are elected by the membership. He stated he would seek clarification if necessary. The State of Florida would also need to designate the specific courses to satisfy the training requirement. Lastly, Mr. Christiansen gave an update on Kandy Lee's disability application. He also stated there is another new disability application from John Trumpet; Attorney Christiansen has received the interrogatories and is collecting the records. He clarified a disability hearing could be a special meeting or an agenda item at a regular meeting; it was only required to be held at a meeting. Attorney Christiansen anticipated the disability hearings could be within 30 to 60 days depending on how quickly their respective health providers could submit medical records and independent medical examinations could be performed. Chair Chapdelain asked if there is any proposed State legislation which may have an impact on the Plan, other than the discussed trustee training. Attorney Christiansen stated his office actively searches under chapter 112, which is the ethics chapter applicable to the Plan, as well as receives regular reports on that chapter; he stated his office regularly checks for proposed bills which could affect the Plan but are not filed under chapter 112. 11. OTHER MATTERS: None. 12. ADJOURN: Chair Chapdelain adjourned the General Employees' Pension Plan Board of Trustees Regular Meeting at 8:58 a.m. ba - Chair Ryah-Chapdelain Secretary Sayla Griggs EAF Book 1 Page 243 02-08-2021 10:00 a.m.