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1 February 9, 2018 Ms. Christine Paz City Fort Piercee / Finance 100 N. U.S. Highway 1 Fort Pierce, Florida Re: City Fort Pierce Police Officers Retirement Trust Fund GASB No. 68 Disclosure Information for Reporting Year Ending September 30, 2017 Dear Christine: As requested, we have prepared actuarial disclosure information required under Governmental Accounting Stards Board (GASB) Statement Number 68 for City Fort Pierce Police Officers Retirement Trust Fund for use in preparation City s GAAP basis employer financial statement for reporting year ending September 30, GASB Statement No. 68 establishes accounting financial reporting stards for state local government employers who provide ir employees (including former employees) pension benefits through a trust. These calculations have been made on a basiss that is consistent with our understing this accounting stard. Enclosed are following exhibits: Executive Summary Schedule Changes in Net Pension Liability Related Ratios for Measurement Year Notes to Net Pension Liability Pension Expense Under GASB No. 68 Statement Outflows Inflows Arising from Current Reporting Period Statement Outflows Inflows Arising from Current Prior Reporting Periods Summary Remaining Deferred Outflows Inflows Resources Schedule Contributions Notes to Schedule Contributions Sensitivity Net Pension Liability to Single Discount Rate Assumption The actuarial valuation liabilities was determined as beginning year, September 30, 2016 (based on actuarial valuation results as reported in September 30, 2016 actuarial valuation report dated March 8, 2017), rolled forward to measurement date, September 30, These liabilities are used for GASB Statement No. 68 reporting for reporting period ending September 30, If significant changes occur during year, such as benefit changes or changes in assumptions or methods, se should be noted in footnotes.

2 Ms. Christine Paz February 9, 2018 Page 2 Required Disclosures This information is intendedd to assist in preparation financial statements Plan. Financial statements are responsibility management, subject to auditor s review. Pleasee let us know if auditor recommends any changes. Our actuarial calculations for this report were prepared for purpose complying with requirements GASB Statement No. 68. These calculations have been made on a basis that is consistent with our understing this Statement. Our calculation liability associated with benefits described in this report was performed for purpose satisfying requirements GASB Statement No. 68. The Net Pension Liability is not an appropriate measure for measuring sufficiency plan assets to cover estimated cost settling employer s benefit obligation. The Net Pension Liability is not an appropriate measure for assessing need for or amount future employer contributions. A calculation plan s liability for purposess or than satisfying requirements GASB Statement No. 68 may produce significantly different results. This report may be provided to parties or than City or Board only in its entirety only with permission City or Board. This report is based upon information, furnished to us by City Fort Piercee Plan Administrator, concerning Plan benefits, active members, deferred vested members, retirees beneficiaries, financial data. This information was checked for internal consistency, but it was not orwise audited. We are not responsible for accuracy or completenesss information providedd by City or Plan Administrator. This report complements actuarial valuation report thatt was provided to Board should be considered in conjunction with that report. Please see actuarial valuation report as September 30, 2016 dated March 8, 2017 for additional discussion nature actuarial calculations information related to participant data, economic demographic assumptions, benefit provisions. The findings in this report are based on data through September 30, 2016 financial information through September 30, Future actuarial measurements may differ significantly from current measurements presented in this report due to such factors as following: plan experience differing from that anticipated by economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part natural operation methodology used for see measurements (such as end an amortization period or additional cost or contribution requirements based on Plan s funded status); changes in plan provisions or applicable law. To best our knowledge, information contained with this report is accurate fairly represents actuarial position Plan. Alll calculations have been made in conformity with generally accepted actuarial principles practices as welll as with Actuarial Stards Practice issued by Actuarial Stards Board. The signing actuaries are independent plan sponsor.

3 Ms. Christine Paz February 9, 2018 Page 3 Peter N. Strong Jeffrey Amrose are members American Academy Actuaries (MAAA) meet Qualification Stards American Academy Actuaries to render actuarial opinions contained herein. This actuarial valuation /or cost determination was prepared completed by us or under our direct supervision, we acknowledge responsibility for results. To best our knowledge, results are complete accurate. In our opinion, techniques assumptions used are reasonable are based on generally accepted actuarial principles practices. Theree is no benefit or expense to be providedd by Plan /or paid from Plan s assets for which liabilities or current costss have not been established or orwise taken into account in valuation. All known events or trends whichh may require a material increase in plan costs or required contribution rates have been taken into account in valuation. We welcome your questions comments. Respectfully submitted, Peter N. Strong, FSA, EA, MAAA, FCA Senior Consultantt Actuary Jeffrey Amrose, EA, MAAA, FCA Senior Consultant Actuary PS/jc Enclosures

4 EXECUTIVE SUMMARY Actuarial Valuation Date September 30, 2016 Measurement Date Net Pension Liability September 30, 2017 Employer's Fiscal Year Ending Date (Reporting Date) September 30, 2017 Membership as Actuarial Valuation Date Number Retirees Beneficiaries 36 Inactive, Nonretired Members 2 Active Members 101 Total 139 Covered Payroll $ 6,957,771 Net Pension Liability Total Pension Liability $ 14,546,221 Plan Fiduciary Net Position 13,973,711 Net Pension Liability $ 572,510 Plan Fiduciary Net Position as a Percentage Total Pension Liability % Net Pension Liability as a Percentage Covered Payroll 8.23 % Development Single Discount Rate Single Discount Rate 7.25 % Long Term Expected Rate Investment Return 7.25 % Long Term Municipal Bond Rate* 3.50 % Last year ending September 30 in 2017 to 2116 projection period for which projected benefit payments are fully funded 2116 Total Pension Expense $ 241,863 Deferred Outflows Deferred Inflows Resources by Source to be recognized in Future Pension Expenses Deferred Outflows Resources Deferred Inflows Resources Difference between expected actual experience $ 177,277 $ 143,375 Changes in assumptions 133,654 Net difference between projected actual earnings on pension plan investments 440, ,471 Total $ 618,250 $ 532,500 *Source: Fidelity's ''20 Year Municipal GO AA Index'' as September 29, This is rate for Fidelity's Fixed Income Market Data/Yield Curve/Data Municipal bonds with 20 years to maturity that include only federally tax exempt municipal bonds. In describing this index, Fidelity notes that municipal curves are constructed using option adjusted analytics a diverse population over 10,000 tax exempt securities. 4

5 SCHEDULE OF CHANGES IN THE EMPLOYER S NET PENSION LIABILITY AND RELATED RATIOS FOR REPORTING YEAR ENDED SEPTEMBER 30, 2017 Measurement Year Ended September 30, A. Total Pension Liability 1. Service Cost $ 492,850 $ 498,450 $ 498, Interest on Total Pension Liability 1,000, , , Changes Benefit Terms 4. Difference Between Expected Actual Experience Total Pension Liability 206,823 (66,499) (158,912) 5. Changes Assumptions (155,930) 6. Benefit Payments (566,773) (540,270) (561,863) 7. Refunds (40,689) (293,992) (121,468) 8. Or 9. Net Change in Total Pension Liability $ 936,684 $ 550,374 $ 572, Total Pension Liability Beginning 13,609,537 13,059,163 12,486, Total Pension Liability Ending $ 14,546,221 $ 13,609,537 $ 13,059,163 B. Plan Fiduciary Net Position 1. Contributions Employer (from City) $ $ $ 2. Contributions Employer (from State) 329, , , Contributions Non Employer Contributing Entity 4. Contributions Employee (Including Buyback Contributions) 487, , , Net Investment Income 1,130,702 1,000,576 (232,886) 6. Benefit Payments (566,773) (540,270) (561,863) 7. Refunds (40,689) (293,992) (121,468) 8. Pension Plan Administrative Expense (34,525) (36,110) (30,114) 9. Or 10. Net Change in Plan Fiduciary Net Position $ 1,305,692 $ 904,815 $ (228,142) 11. Plan Fiduciary Net Position Beginning 12,668,019 11,763,204 11,991, Plan Fiduciary Net Position Ending $ 13,973,711 $ 12,668,019 $ 11,763,204 C. Net Pension Liability $ 572,510 $ 941,518 $ 1,295,959 D. Plan Fiduciary Net Position as a Percentage Total Pension Liability 96.06% 93.08% 90.08% E. Covered Payroll $ 6,957,771 $ 6,739,629 $ 6,450,909 F. Net Pension Liability as a Percentage Covered Payroll 8.23% 13.97% 20.09% 5

6 NOTES TO NET PENSION LIABILITY Valuation Date: September 30, 2016 Measurement Date: September 30, 2017 Methods Assumptions Used to Determine Net Pension Liability: Actuarial Cost Method Entry Age Normal Inflation 2.5% Salary Increases 3.5% to 6.5% depending on completed years service, including inflation Investment Rate Return 7.25% Retirement Age Experience based table rates that are specific to type eligibility condition. Mortality RP 2000 Combined Healthy Participant Mortality Table (for preretirement mortality) RP 2000 Mortality Table for Annuitants (for postretirement mortality), with mortality improvements projected to all future years after 2000 using Scale BB. For males, base mortality rates include a 90% blue collar adjustment a 10% white collar adjustment. For females, base mortality rates include a 100% white collar adjustment. These are same rates currently in use for Special Risk Class members Florida Retirement System (FRS), as mated by Florida House Bill Or Information: Notes See Discussion Valuation Results in September 30, 2016 Actuarial Valuation Report. Effective as September 30, 2016, mortality assumption was changed from RP 2000 Combined Healthy Participant Mortality Table for males females with mortality improvement projected to all future years after 2000 using Scale AA to FRS tables described above. 6

7 PENSION EXPENSE FISCAL YEAR ENDED SEPTEMBER 30, 2017 (BASED ON MEASUREMENT PERIOD ENDING SEPTEMBER 30, 2017) Pension Expense 1. Service Cost $ 492, Interest on Total Pension Liability 1,000, Current Period Benefit Changes 4. Employee Contributions (made negative for addition here) (487,044) 5. Projected Earnings on Plan Investments (made negative for addition here) (924,775) 6. Pension Plan Administrative Expense 34, Or Changes in Plan Fiduciary Net Position 8. Or Changes in Total Pension Liability 9. Recognition Outflow (Inflow) Resources due to Liabilities (23,154) 10. Recognition Outflow (Inflow) Resources due to Assets 149, Total Pension Expense $ 241,863 7

8 STATEMENT OF OUTFLOWS AND INFLOWS ARISING FROM CURRENT REPORTING PERIOD EMPLOYER FISCAL YEAR ENDED SEPTEMBER 30, 2017 (BASED ON MEASUREMENT PERIOD ENDING SEPTEMBER 30, 2017) A. Outflows (Inflows) Resources due to Liabilities 1. Difference between expected actual experience Total Pension Liability due to (gains) or losses $ 206, Assumption Changes (gains) or losses $ (155,930) 3. Recognition period for Liabilities: Average expected remaining service lives all employees {in years} Outflow (Inflow) Resources to be recognized in current pension expense for difference between expected actual experience Total Pension Liability $ 29, Outflow (Inflow) Resources to be recognized in current pension expense for assumption changes $ (22,276) 6. Outflow (Inflow) Resources to be recognized in current pension expense due to Liabilities $ 7, Deferred Outflow (Inflow) Resources to be recognized in future pension expenses for difference between expected actual experience Total Pension Liability $ 177, Deferred Outflow (Inflow) Resources to be recognized in future pension expenses for assumption changes $ (133,654) 9. Deferred Outflow (Inflow) Resources to be recognized in future pension expenses due to Liabilities $ 43,623 B. Outflows (Inflows) Resources due to Assets 1. Net difference between projected actual earnings on pension plan investments due to (gains) or losses $ (205,927) 2. Recognition period for Assets {in years} Outflow (Inflow) Resources to be recognized in current pension expense due to Assets $ (41,185) 4. Deferred Outflow (Inflow) Resources to be recognized in future pension expenses due to Assets $ (164,742) 8

9 STATEMENT OF OUTFLOWS AND INFLOWS ARISING FROM CURRENT AND PRIOR REPORTING PERIODS EMPLOYER FISCAL YEAR ENDED SEPTEMBER 30, 2017 (BASED ON MEASUREMENT PERIOD ENDING SEPTEMBER 30, 2017) A. Outflows Inflows Resources due to Liabilities Assets to be Recognized in Current Pension Expense Outflows Inflows Net Outflows Resources Resources Resources 1. Due to Liabilities $ 29,546 $ 52,700 $ (23,154) 2. Due to Assets 220,486 71, , Total $ 250,032 $ 124,128 $ 125,904 B. Outflows Inflows Resources by Source to be Recognized in Current Pension Expense Outflows Inflows Net Outflows Resources Resources Resources 1. Differences between expected actual experience $ 29,546 $ 30,424 $ (878) 2. Assumption Changes 22,276 (22,276) 3. Net Difference between projected actual earnings on pension plan investments 220,486 71, , Total $ 250,032 $ 124,128 $ 125,904 C. Deferred Outflows Deferred Inflows Resources by Source to be Recognized in Future Pension Expenses Deferred Outflows Deferred Inflows Net Deferred Outflows Resources Resources Resources 1. Differences between expected actual experience $ 177,277 $ 143,375 $ 33, Assumption Changes 133,654 (133,654) 3. Net Difference between projected actual earnings on pension plan investments 440, , , Total $ 618,250 $ 532,500 $ 85,750 D. Deferred Outflows Deferred Inflows Resources by Year to be Recognized in Future Pension Expenses Year Ending September 30 Net Deferred Outflows Resources 2018 $ 125, , (94,582) 2021 (64,341) 2022 (12,562) Thereafter 5,426 Total $ 85,750 9

10 SUMMARY OF REMAINING DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES Amount Date Recognition Original Years Remaining Recognized in Established Source Period (years) Amount Remaining Amount Current Expense Deferred Outflows Resources 9/30/2015 Investment Exp. Loss 5.0 $ 1,102, $ 661,459 $ 220,486 9/30/2017 Liability Exp. Loss , ,823 29,546 Deferred Inflows Resources SUBTOTAL: 1,309, , ,032 9/30/2015 Liability Exp. Gain 7.5 $ (158,912) 5.5 $ (116,536) $ (21,188) 9/30/2016 Investment Exp. Gain 5.0 (151,215) 4.0 (120,972) (30,243) 9/30/2016 Liability Exp. Gain 7.2 (66,499) 6.2 (57,263) (9,236) 9/30/2017 Investment Exp. Gain 5.0 (205,927) 5.0 (205,927) (41,185) 9/30/2017 Assumption Changes 7.0 (155,930) 7.0 (155,930) (22,276) SUBTOTAL: (738,483) (656,628) (124,128) GRAND TOTAL: $ 570,771 $ 211,654 $ 125,904 10

11 SCHEDULE OF CONTRIBUTIONS Actuarially Contribution Actual Contribution FY Ending Determined Actual Deficiency Covered as a % September 30, Contribution Contribution (Excess) Payroll Covered Payroll 2014 $ 285,353 $ 248,113 $ 37,240 * $ 6,426, % , ,449 (66,761) 6,450, % , ,837 (129,629) 6,739, % , ,933 (143,465) 6,957, % *This deficiency is satisfied through use an excess contribution reserve, which was built up by contributions in excess Actuarially Determined Contribution in previous years. 11

12 NOTES TO SCHEDULE OF CONTRIBUTIONS Valuation Date: September 30, 2016 Notes Actuarially determined contribution rates are calculated as October 1, which is beginning fiscal year in which contributions are reported. Methods Assumptions Used to Determine Contribution Rates: Actuarial Cost Method Entry Age Normal Amortization Method Level Percent Payroll, Closed Remaining Amortization Period 18 years (single equivalent amortization period) Asset Valuation Method 4 year smood market Inflation 2.50% Salary Increases 3.5% to 6.5% depending on completed years service, including inflation Investment Rate Return 7.25% Retirement Age Experience based table rates that are specificto type eligibility condition. Mortality RP 2000 Combined Healthy Participant Mortality Table (for preretirement mortality) RP 2000Mortality Table for Annuitants (for postretirement mortality), with mortality improvements projected to all future years after 2000 using Scale BB. For males, base mortality rates include a 90% blue collar adjustment a 10% white collar adjustment. For females, base mortality rates include a 100% white collar adjustment. These are same rates currently in use for Special Risk Class members Florida Retirement System (FRS), as mated by Florida House Bill Or Information: Notes See Discussion Valuation Results in September 30, 2016 Actuarial Valuation Report. 12

13 SENSITIVITY OF NET PENSION LIABILITY TO THE SINGLE DISCOUNT RATE ASSUMPTION A single discount rate 7.25% was used to measure total pension liability. This single discount rate was based on expected rate return on pension plan investments 7.25%. The projection cash flows used to determine this single discount rate assumed that plan member contributions will be made at current contribution rate that employer contributions will be made at rates equal to difference between total actuarially determined contribution rates member rate. Based on se assumptions, pension plan s fiduciary net position was projected to be available to make all projected future benefit payments current plan members. Therefore, long term expected rate return on pension plan investments (7.25%) was applied to all periods projected benefit payments to determine total pension liability. Regarding sensitivity net pension liability to changes in single discount rate, following presents plan s net pension liability, calculated using a single discount rate 7.25%, as well as what plan s net pension liability would be if it were calculated using a single discount rate that is 1 percentage point lower or 1 percentage point higher: Sensitivity Net Pension Liability to Single Discount Rate Assumption Current Single Discount 1% Decrease Rate Assumption 1% Increase 6.25% 7.25% 8.25% $2,445,564 $572,510 ($981,083) 13