Attachment B - Metro 2024 DB Retirement Plan Financial Statement_Final_3-30-2025.pdf

METRO WATER RECOVERY

DEFINED BENEFIT RETIREMENT PLAN

FINANCIAL STATEMENTS AND

REQUIRED SUPPLEMENTARY INFORMATION

December 31, 2024 and 2023 (with Independent Auditors’ Report Thereon)

Metro Water Recovery Defined Benefit Retirement Plan

For the Years Ended December 31, 2024 and 2023 i | P a g e

METRO WATER RECOVERY

DEFINED BENEFIT RETIREMENT PLAN

Table of Contents

Page

Independent Auditors’ Report

Management’s Discussion and Analysis (Unaudited)

Statements of Fiduciary Net Position – December 31, 2024 and 2023

Statements of Changes in Fiduciary Net Position – Years Ended December 31, 2024 and 2023

Notes to Financial Statements

Required Supplementary Information

Schedule of Changes in Net Pension Liability and Related Ratios (Unaudited) – Ten Years Ended December 31, 2024

Schedule of Employer Contributions (Unaudited) – Ten Years Ended December 31, 2024

Schedule of Investment Returns (Unaudited) – Ten Years Ended December 31, 2024

For the Years Ended December 31, 2024 and 2023

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Report of Independent Auditors

The Defined Benefit Retirement Board Metro Water Recovery Defined Benefit Retirement Plan

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Metro Water Recovery Defined Benefit Retirement Plan (the Plan), which comprise the statements of fiduciary net position as of December 31, 2024 and 2023, and statements of changes in fiduciary net position for the years then ended, and the related notes to the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the fiduciary net position of the Plan as of December 31, 2024 and 2023, and the changes in fiduciary net position for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards (Government Auditing Standards), issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Plan, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Plan’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

For the Years Ended December 31, 2024 and 2023

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Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS and Government Auditing Standards, we

• Exercise professional judgment and maintain professional skepticism throughout the audit.

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control. Accordingly, no such opinion is expressed.

• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Plan’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit.

For the Years Ended December 31, 2024 and 2023

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Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, Schedules of Changes in Net Pension Liability and Related Ratios, Schedule of Employer Contributions, and Schedule of Investment Returns, as listed in the table of contents, be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Denver, Colorado March 28, 2025

Management’s Discussion and Analysis (Unaudited)

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Management is pleased to present this discussion and analysis of the financial activities of Metro Water Recovery’s Defined Benefit Retirement Plan (Plan) as of and for the years ended December 31, 2024 and 2023.

The Plan administers the retirement plan benefits for eligible covered employees and retirees of Metro Water Recovery (Metro). All assets of the Plan are invested in a single trust fund. The sole purpose of the fund is to pay for benefit promises made to retired, deferred vested and active members of the Plan.

Overview of the Financial Statements The management’s discussion and analysis is intended to serve as an introduction to the financial statements. The financial section consists of the basic financial statements and required supplementary information.

Two financial statements are presented for the Plan. The statements of fiduciary net position present assets held in trust for pension benefits at a given point in time, net of accrued liabilities of the Plan. The statements of changes in fiduciary net position indicate the additions and deductions to the Plan net position during the specified periods.

The notes to the financial statements provide essential information for understanding the data in the financial statements by providing information about the description of the Plan, significant accounting policies, investment assets and liabilities, and contributions.

The required supplementary information includes three schedules. The schedule of changes in net pension liability and related ratios shows sources of changes in the net pension liability and information about the components of the net pension liability and related ratios. The schedule of employer contributions provides historical information about actuarially determined contributions, actual contributions made to the Plan by Metro, and covered payroll.

The schedule of investment returns provides information on annual money-weighted rate of return on Plan investments.

Financial Information

2024 2023 2022 Assets:

Cash and short-term investments 964$ 1,227$ 962$ Investments, at fair value:

Public equity 58,969 59,519 59,928 Private equity 9,437 9,680 10,138 Fixed rate debt 43,170 31,067 14,698 Floating rate debt 14,334 12,693 12,430 Real estate 17,493 17,869 20,057

Total assets 144,367 132,055 118,213 Liabilities:

Accrued administrative expenses 12 27 28

Fiduciary net position restricted for pension benefits 144,355$ 132,028$ 118,185$

Fiduciary Net Position (in thousands)

December 31

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2023 2023 2022 Additions:

Investment income:

Net appreciation (depreciation) in fair value of investments 7,581$ 9,857$ (17,594)$ Interest and dividend income 3,466 2,737 2,145 Less investment expense (382) (386) (382)

Net investment income (loss) 10,665 12,208 (15,831) Contributions from employer 11,585 10,053 8,386 Contributions from employees 1,210 1,239 1,230

Total additions (reductions) 23,460 23,500 (6,215) Deductions:

Benefit payments 11,064 9,586 11,839 Administrative expenses 69 71 63

Total deductions 11,133 9,657 11,902 Net increase (decrease) in plan fiduciary net position 12,327 13,843 (18,117)

Fiduciary net position restricted for pension benefits:

Beginning of year 132,028 118,185 136,302 End of year 144,355$ 132,028$ 118,185$

Changes in Fiduciary Net Position (in thousands)

Year ended December 31

Plan net position increased by $12.3 million, or 9.3%, during 2024 and increased by $13.8 million, or 11.7%, during 2023. The increase in net position in 2024 was primarily due to net appreciation in the fair value of investments of $7.6 million in addition to interest and dividends received in 2024 of $3.5 million. The increase in net position in 2023 was primarily due to net appreciation in the fair value of investments of $9.9 million in addition to interest and dividends received in 2023 of $2.7 million. In 2024, employer contributions increased to $11.6 million from $10.1 million in 2023, or 15.2%. In 2023, employer contributions increased to $10.1 million from $8.4 million in 2022, or 19.9%. Employer contributions are actuarially determined on an annual basis. Increases in 2024 and 2023 are primarily due to the Plan Board’s policy to fully fund the Plan by 2027. Employee contributions remained about the same in 2024 as 2023, amounting to $1.21 million in 2024, a decrease of 2.3%. Employee contributions increased slightly in 2023 compared to 2022, amounting to $1.24 million in 2023, an increase of 0.7%. The employee contribution amount was 7.0% of pay for 2024, 2023, and 2022. Total employee contributions will continue to decrease due to retirements of active participants, as the Plan closed to new entrants in 2013.

Total benefit payments increased to $11.0 million in 2024, an increase of $1.5 million, or 15.8% over 2023. Total benefit payments decreased by $2.3 million, or 19.0%, in 2023. In 2024, there were approximately 15 new retirees in addition to 12 lump sum payments. In 2023, there were approximately 10 new retirees in addition to 5 lump sum payments. Lump-sum payments totaled $1.3 million in 2024 (12 retirees), an increase of $1.0 million or 305.0%, compared to 2023. Lump-sum payments totaled $0.3 million in 2023 (5 retirees), a decrease of $0.07 million or 88.8%, compared to 2022. There were no ad hoc increases in benefits in 2024, 2023 and 2022.

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Administrative expenses reflect external audit, legal, and actuarial fees. Actuarial and legal fees will fluctuate from year to year, depending on additional work required to assess and implement any proposed changes to the Plan.

Administrative expenses in 2024 decreased by $2.4 thousand, or 3.4%, compared to 2023. This slight decrease is attributable to a decrease in legal services. Administrative expenses in 2023 increased by $8.7 thousand, or 13.9%, over 2022. This increase is attributable to slight increases in actuary and audit service costs.

Investment expenses in 2024 decreased by $4.4 thousand, or 1.1%, compared to 2023. Investment expenses in 2023 increased by $4.1 thousand, or 1.1%, over 2022. Investment expenses consist of fees paid to the trustee, the Plan’s investment consultant, and equity and fixed income investment managers. Investment expenses can fluctuate year to year, depending on the size of the portfolio, rebalancing of the portfolio, and the addition or removal of investment managers.

Interest and dividend income increased by $0.7 million, or 26.6%, in 2024 and increased by $0.6 million, or 27.6%, in 2023. Interest and dividend income can fluctuate due to economic conditions and the mix of investment managers in the portfolio.

The overall net rates of return of the portfolio of investments for 2024 and 2023 were 7.6% and 10.3%, respectively.

2024 2023

Public equity 14.2% 23.9%

Private equity 0.4% -5.1%

Fixed rate debt 1.6% 6.2%

Floating rate debt 7.8% 5.5%

Real estate funds -2.1% -10.9%

The annual money-weighted rate of return on the pension plan investments at December 31, 2024 was 7.73%. The money-weighted rate of return expresses investment performance, net of pension plan investment expense, adjusted for the changing amounts actually invested.

As of December 31, 2024, the Fiduciary Net Position as a Percent of Total Pension Liability of the Plan increased to 77.02% from the previous level of 72.15%. The Fiduciary Net Position as a Percent of Total Pension Liability is determined by dividing the Fiduciary Net Position by the Total Pension Liability. It measures the progress of the Plan in accumulating the assets available to fund the actuarially determined long-term liability. The ratios are as follows:

Year:

2024 77.02% 2023 72.15% 2022 67.60%

Management maintains a cash flow management strategy to ensure adequate cash reserves are available to pay benefits and administrative expenses.

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Requests for Information

This financial report is designed to provide a general overview of the Plan’s finances for all those with an interest in the Plan’s finances and to demonstrate the Plan’s accountability for the money it receives. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the attention of Molly Kostelecky, Chief Financial Officer, Metro Water Recovery, 6450 York Street, Denver, CO 80229. Additional information about Metro Water Recovery can be found at www.metrowaterrecovery.com.

Basic Financial Statements

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Statements of Fiduciary Net Position

2024 2023 Assets:

Cash and short-term investments 964,182$ 1,226,951$ Investments, at fair value:

Public equity 58,969,402 59,518,878 Private equity 9,436,609 9,680,366 Fixed rate debt 43,169,858 31,066,895 Floating rate debt 14,334,114 12,692,708 Real estate 17,492,410 17,869,554

Total assets 144,366,575 132,055,352 Liabilities:

Accrued administrative expenses 11,947 27,825 Fiduciary net position restricted for pension benefits 144,354,628$ 132,027,527$

See accompanying notes to financial statements.

Basic Financial Statements

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Statements of Changes in Fiduciary Net Position

2024 2023 Additions:

Investment income:

Net appreciation in fair value of investments 7,580,703$ 9,856,772$ Interest and dividend income 3,465,865 2,737,360 Less investment expense (381,600) (386,005)

Net investment income 10,664,968 12,208,127 Contributions from employer 11,584,570 10,053,490 Contributions from employee 1,210,438 1,238,493

Total additions 23,459,976 23,500,110 Deductions:

Benefit payments 11,064,073 9,586,425 Administrative expenses 68,802 71,192

Total deductions 11,132,875 9,657,617 Net increase in plan fiduciary net position 12,327,101 13,842,493

Fiduciary net position restricted for pension benefits:

Beginning of year 132,027,527 118,185,034 End of year 144,354,628$ 132,027,527$

Year ended December 31

See accompanying notes to financial statements.

Notes to Financial Statements

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(1) Plan Description

(a) General

Plan Administration Metro Water Recovery Retirement Plan (Plan) is a single-employer, defined benefit pension plan covering substantially all employees of Metro Water Recovery (Metro) hired before January 1, 2013, the date for which the Plan was closed to new members. The Plan is administered by a Retirement Board, which consists of seven members who are appointed by the Board of Directors of Metro. The provisions of the Plan give Metro’s Board of Directors the right and authority to establish and amend the benefit provisions of the Plan. The Plan provides retirement, disability, and death benefits to Plan members and their beneficiaries. Participants are fully vested in Plan benefits after completion of five years of eligible service. The Plan was amended in 2021 to clarify the lump sum option for death benefits includes a participant’s “entire vested Accrued Benefit,” which could include post-2012 accruals.

Employees who terminate employment at age 65 generally receive the Normal Retirement Benefit, which is equal to 2% of their final average salary multiplied by the number of years of credited service.

The final average salary is the average annual salary for the three highest consecutive years out of the participant’s last 10 years of employment.

Employees who terminate employment after completing 10 years of service before the age of 65 are eligible for the Early Retirement Benefit, which is equal to the Normal Retirement Benefit reduced by 1/15th for each of the first 5 years and 1/30th for each additional year by which the payments precede the normal retirement age (age 65).

Employees who terminate employment after completing 10 years of service before age 65 and having the sum of age plus years of service equal to at least 80 are eligible for the Rule of 80 Benefit. The Rule of 80 Benefit is calculated in the same manner as the Normal Retirement Benefit.

Disability benefits are paid to participants who become totally and permanently disabled who meet the eligibility requirements for the Normal Retirement Benefit or the Early Retirement Benefit.

Benefits Provided The standard method of paying benefits to participants is monthly payments. The Plan also allows participants to elect a combination of a lump-sum distribution and monthly payments or certain other annuity options. The Board of Directors has elected occasionally, in the past, to make ad hoc postretirement increases for monthly payments to participants to adjust payments for the effect of inflation using the consumer pricing index. These ad hoc payments are at the discretion of the Board of Directors and are not required by the Plan.

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At December 31, 2024 and 2023, the Plan’s membership consisted of the following:

2024 2023 Retirees and beneficiaries eligible to receive benefits as of December 31 310 299 Terminated employees, entitled to, but not yet receiving benefits 105 113 Active plan members 134 143

Total 549 555

Contributions Metro contributes such amounts as are deemed necessary on an actuarial basis to provide the Plan with assets sufficient to meet the benefits to be paid to Plan participants.

Plan Termination Although it has not expressed any intention to do so, Metro has the right under the Plan to discontinue its contributions at any time and to terminate the Plan.

Should the Plan be terminated, all participants would become fully vested and the net position of the Plan would be allocated for the benefit of each participant and beneficiary in a manner approved by the Internal Revenue Service.

(b) Reporting Entity

The Plan is a pension trust fund of Metro Water Recovery. The accompanying financial statements present only the financial position of the Plan and do not purport to, and do not present the financial position and changes in financial position of Metro in conformity with U.S. generally accepted accounting principles.

(2) Summary of Significant Accounting Policies

(a) Basis of Accounting

The financial statements of the Plan are prepared using the economic resources measurement focus and the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (GAAP) applicable to governmental accounting in accordance with the Governmental Accounting Standards Board (GASB). Investment income is recorded when earned.

Expenses are recorded when liabilities are incurred. Metro’s contributions are recognized when due, and Metro has made a formal commitment to provide the contributions. Employee contributions are recognized when due, as the contributions are withheld from the employee’s paychecks. Benefits and refunds are recognized when due and payable in accordance with the terms of the Plan.

(b) Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of additions and deductions during the reporting period. Actual results could differ significantly from those estimates.

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(c) Income Taxes

The Plan is qualified under Section 401(a) of the Internal Revenue Code (the Code). The Plan is a governmental plan as described in Section 414(d) of the Code. It is, therefore, exempt from federal income taxation under Section 501(c)(25)(C)(ii) of the Code.

(d) Contributions

Employee contributions to the Plan were prohibited from 1979 to July 2007. However, changes to the Plan, effective July 8, 2007, require employee contributions, which range from 1% in 2007 to 7% in 2015 and beyond. The payroll for employees covered by the Plan for the years ended December 31, 2024 and 2023 was $17,248,859 and $17,140,732, respectively. Metro’s total payroll for the years ended December 31, 2024 and 2023 was $47,141,448 and $42,778,354, respectively.

During 2024 and 2023, contributions made by Metro totaled $11,584,570 and $10,053,490, respectively. Employee contributions to the Plan totaled $1,210,438 and $1,238,493, respectively.

(3) Investments The Plan is a noninsured trust retirement plan, with a bank or trust company authorized to exercise trust powers in Colorado as trustee. As such, the Plan’s assets are invested using the “Colorado Uniform Prudent Investor Act” found in the provisions of Part 3 of Article 1 of Title 15, C.R.S.

The Plan assets are invested and managed as a prudent investor would, by considering the purposes, terms, distribution requirements, and other circumstances. In satisfying this standard, all fiduciaries shall exercise reasonable care, skill, and caution. Investment decisions should be evaluated within the context of the entire portfolio (rather than on an individual investment basis) and as part of an overall investment strategy having risk and return objectives reasonably suited to the Retirement Plan’s purpose.

Separate accounts, mutual funds, and other investment vehicles may be used based upon the most favorable approach for the Plan’s circumstances, assuming the vehicle meets the Fiduciary Standard and specific guidelines for the manager. It is recognized that if a pooled fund is used, the fund’s investment manager, rather than the Plan, sets the fund’s investment policies, strategies, objectives, guidelines, and restrictions.

Mutual funds are recorded at quoted market prices at December 31, 2024 and 2023. The underlying properties held within the real estate fund, Principal U.S. Property account, are appraised annually and financial statements are audited by an internationally recognized accounting firm. The Plan also invests in floating rate debt funds, which are valued monthly, and private equity funds, which are valued quarterly. These investments are valued at their net asset value as determined by the custodian under the direction of the Plan with the assistance of an independent consultant.

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At December 31, 2024 and 2024, the Plan had the following investments:

December 31 2024 2023

Cash and short-term investments $ 964,182 $ 1,226,951 Public equity 58,969,402 59,518,878 Private equity 9,436,609 9,680,366 Fixed rate debt 43,169,858 31,066,895 Floating rate debt 14,334,114 12,692,708 Real estate 17,492,410 17,869,554

$ 144,366,575 $ 132,055,352

Investment income for the Plan for the years ended December 31, 2024 and 2023 was comprised the following:

2024 2023 Interest and dividend income $ 3,465,865 $ 2,737,360 Net realized gain on investments 14,015,578 2,069,623 Net unrealized gain (loss) on investments (6,434,875) 7,787,149

11,046,568 12,594,132 Less investment expenses (381,600) (386,005)

Net investment income $ 10,664,968 $ 12,208,127

The calculation of realized gains and losses is independent of the calculation of the net change in the fair value of investments. Realized gains and losses on investments that had been held in more than one fiscal year and sold in the current year may have been recognized as an increase or decrease in the fair value of investments reported in the prior year.

Net unrealized gain or loss on investments is reported net of certain investment manager and investment fund fees that range on an annual basis from approximately $3,000 to $119,000 (per investment manager of fund) with rates of .03% to 1.75% of the average portfolio or fund balances in 2024 and 2023. Based on these rates, management estimates approximately $493,000 and $433,000 of investment fees are included in net unrealized gain for the years ended December 31, 2024 and 2023, respectively.

For the year ended December 31, 2024, the annual money-weighted rate of return on pension plan investments, net of pension plan investment expense, was 7.73%.

(a) Investment Policy

The Plan has an investment policy and strategic asset allocation and investment structure that regulates investments by hiring a qualified investment consultant to oversee qualified investment management firms who manage the assets of the Plan. The investment policy establishes an asset allocation strategy, investment objectives, and investment guidelines for all assets. The asset allocation strategy is designed to be consistent with the safety and return objectives of the Plan and includes allowable global equity, debt, alternatives, and real estate investments. The strategic asset allocation and investment structure identifies the assumed rate of return, asset class targets and ranges, manager selection guidelines, and investment structure and benchmarks. All securities and investments owned by the Plan are in conformity with the investment policy and strategic asset allocation and investment structure.

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The Plan’s allowable investments in equities, fixed income, and real estate are limited to qualified investment managers.

The Plan’s policy in regard to the allocation of invested assets is established and may be amended by the Metro Water Recovery Defined Benefit Retirement Board by a majority vote of its members. The investment policy calls for cash reserves to be held in money market funds in the Plan’s operating account at the Trustee bank at a level based on the liquidity needs as determined by Metro finance staff.

The following was the Retirement Board’s asset allocation policy as of December 31, 2024.

Investment Type Target Allocation Target Range Public equity 40.00% 35%-45% Private equity 5.00% 0%-10% Fixed rate debt 30.00% 25%-35% Floating rate debt 10.00% 5%-15% Real estate 15.00% 10%-20%

100.00%

(b) Investment Risk Factors

There are many factors that can affect the value of investments. Some, such as custodial risk, concentration risk, and foreign currency risk, may affect both equity and debt securities. Equity securities respond to such factors as economic conditions, individual company earnings, performance, and market liquidity, while debt securities are particularly sensitive to credit risks and changes in interest rates. The Plan has established investment policies to provide the basis for the management of a prudent investment program appropriate to the particular fund types.

(c) Credit Risk

Credit risk is the risk that an issuer or other party to an investment will not fulfill its obligation to the Plan. Credit risk exposure is managed in accordance with investment guidelines as stated in the formal investment policy adopted by the Board. The Plan assets will be invested in accordance with the “Colorado Uniform Prudent Investor Act” found in the provisions of Part 3 of Article 1 of Title 15, C.R.S. The Plan assets shall be invested and managed as a prudent investor would, by considering the purposes, terms, distribution requirements and other circumstances.

In satisfying this standard, all fiduciaries shall exercise reasonable care, skill and caution. Investment decisions should be evaluated within the context of the entire portfolio, rather than on an individual investment basis, and as part of an overall investment strategy having risk and return objectives reasonably suited to the Plan’s purpose. The Plan does not own any derivative investments.

(d) Custodial Risk

Custodial credit risk is the risk that in the event of a bank failure, the Plan’s deposits may not be returned to it. All securities are registered in the name of US Bank as the Trustee for the Plan and held by third-party safekeeping agents. Investments in money market mutual funds are not exposed to custodial risk because their existence is not evidenced by securities that exist in physical or book entry form. Other deposits may include small amounts of cash held for short periods of time prior to investment. These deposits are insured by FDIC up to $250,000. As of December 31, 2024 and 2023, the Plan’s deposits had balance of $33,175 and $216,179, respectively.

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(e) Concentration of Credit Risk

The Plan has a concentration of credit risk where it holds more than 5% of its investment portfolio in any one security issuer, other than those explicitly guaranteed by the U.S. government. Mutual funds, external investment pools, and other pooled investments are also excluded from this requirement. The Plan had no concentration of credit risk as of December 31, 2024 and 2023.

(f) Interest Rate Risk

Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The Plan’s investment policy manages its exposure to fair value losses arising from rising interest rates by specific guidelines for debt managers.

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The following is a summary of the Plan’s debt investments at December 31, 2024 and 2023 with average credit ratings based on Standard & Poor’s rating scale:

2024 2023 Western Asset Management Core Plus Bond Fund IS Fair value $ - $ 12,540,010 Modified duration (in years) Not available 7.1 Average rating Not rated Not rated

JP Morgan Core Bond Fund Fair value $ 29,190,237 $ 18,526,885 Modified duration (in years) 6.1 6.1 Average rating Not rated Not rated

Dodge & Cox Income Fund Fair value $ 13,979,621 $ - Modified duration (in years) 6.3 Not available Average rating Not rated Not rated

Bain Senior Loan Fund Fair value $ 8,734,144 $ 8,007,169 Modified duration (in years) 0.1 0.3 Average rating Not rated Not rated

Golub Capital Partners International 11, L.P.

Fair value $ 1,800,220 $ 1,750,000 Modified duration (in years) Not available Not available Average rating Not rated Not rated

Principal Real Estate Debt Fund II Fair value $ 223,665 $ 723,139 Modified duration (in years) 0.1 0.4 Average rating Not rated Not rated

Principal Real Estate Debt Fund III Fair value $ 2,092,547 $ 2,212,400 Modified duration (in years) 0.4 1.1 Average rating Not rated Not rated

Principal Real Estate Open End Debt Fund Fair value $ 1,483,538 $ - Modified duration (in years) Not available Not available Average rating Not rated Not rated

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Investments in money market funds of $931,091 and $1,010,772 for December 31, 2024 and 2023, respectively, have an average maturity of fewer than 32 and 42 days, for December 31, 2024 and 2023, respectively.

(g) Foreign Currency Risk

For 2024 and 2023, the Plan’s investments managed exposure to foreign currency risk by limiting the allocation percentage of interest of global equity investments to 25.0% and 25.0%, respectively. The global equities in which the Plan has invested have a fair value of $36,759,211 and $33,192,985, or 25.5% and 25.1% of the total portfolio at December 31, 2024 and 2023, respectively. Each fund is valued in U.S. dollars with exposure to various worldwide currencies. Any overallocation of funds are rebalanced on a regular basis.

(h) Fair Value Measurement

The Plan categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The Plan has the following recurring fair value measurements as of December 31, 2024:

Investments Measured at Fair Value

Quoted Prices in Active Significant

Markets for Other Significant Identical Observable Unobservable Assets Inputs Inputs

12/31/2024 (Level 1) (Level 2) (Level 3) Investments by fair value level

Public equity 58,969,402$ 58,969,402$ -$ -$ Fixed rate debt 43,169,858 43,169,858 - - Total investments measured at fair value level 102,139,260 102,139,260 - -

Investments measured at the net asset value (NAV) Private equity 9,436,609 Floating rate debt 14,334,114 Real estate 17,492,410 Total investment measured at the NAV 41,263,133

Total investments measured at fair value 143,402,393

Investments measured at amortized cost Money market funds 931,007

Total investments 144,333,400

Cash and cash equivalents 33,175

Total cash and investments 144,366,575$

Fair Value Measurement Using

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The Plan categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The Plan has the following recurring fair value measurements as of December 31, 2023:

Investments Measured at Fair Value

Quoted Prices in Active Significant

Markets for Other Significant Identical Observable Unobservable Assets Inputs Inputs

12/31/2023 (Level 1) (Level 2) (Level 3) Investments by fair value level

Public equity 59,518,878$ 59,518,878$ -$ -$ Fixed rate debt 31,066,895 31,066,895 - - Total investments measured at fair value level 90,585,773 90,585,773 - -

Investments measured at the net asset value (NAV) Private equity 9,680,366 Floating rate debt 12,692,708 Real estate 17,869,554 Total investment measured at the NAV 40,242,628

Total investments measured at fair value 130,828,401

Investments measured at amortized cost Money market funds 1,010,772

Total investments 131,839,173

Cash and cash equivalents 216,179

Total cash and investments 132,055,352$

Fair Value Measurement Using

For investments categorized as Level 1, prices are determined using quoted prices in active markets for identical securities. For investments categorized as Level 2, prices are determined using other significant observable inputs. Observable inputs are inputs that reflect the assumptions market participants would use by pricing a security and are developed based on market data obtained from sources independent of the reporting entity. These may include quoted market prices for similar assets, quoted prices for identical or similar assets in markets that are not active or other quoted prices that are not observable.

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The valuation method for investments at December 31, 2024 measured at the net asset value (NAV) per share (or its equivalent) is presented on the following table.

Investments measured at the NAV Redemption Redemption Fair Unfunded Freqency (if Notice

Value Commitments Currently Eligible) Period Private equity (1) 9,436,609$ 1,667,661$ n/a n/a

Floating rate debt (2) 14,334,114 3,798,987 monthly, n/a, n/a, n/a, quarterly 30 days, n/a, n/a, n/a, 90-days Real estate (3) 17,492,410 - daily based on liquidity 1 day

41,263,133$

The valuation method for investments at December 31, 2023 measured at the net asset value (NAV) per share (or its equivalent) is presented on the following table.

Investments measured at the NAV Redemption Redemption Fair Unfunded Freqency (if Notice

Value Commitments Currently Eligible) Period Private equity (1) 9,680,366$ 1,871,228$ n/a n/a

Floating rate debt (2) 12,692,708 5,329,883 monthly, n/a, n/a, n/a, quarterly 30 days, n/a, n/a, n/a, 90-days Real estate (3) 17,869,554 - daily based on liquidity 1 day

40,242,628$

(1) There are four investments in this category. One fund’s primary purpose of developing and actively managing an investment portfolio of private equity funds and other investment vehicles, principally by making, holding and disposing of privately negotiated investments in the form of limited partner interests and securities. The nature of the investments in this type is that distributions are received through the liquidation of the underlying assets of the fund. It is estimated that the underlying assets of the partnership would be liquidated over 12 to 15 years.

The second fund invests predominantly in U.S. venture capital-focused funds on a primary and secondary basis. Partnership investments will include start-up, early-stage, late-stage and growth equity funds as well as secondary funds focusing on direct investments in venture-backed and/or technology companies. The fund may re-invest proceeds of portfolio investments; provided, however, that the acquisition costs of all portfolio investments will not exceed 110% of aggregate subscriptions. The nature of the investments in this type is such that distributions are received through the liquidation of the underlying assets of the fund. It is expected that the underlying assets of the fund would be liquidated over 12 years.

The third fund invests predominantly in North American and Western Europe value orientated equity investments. Partnership investments are generally traditional middle market buyouts of out-of-favor industries and companies focusing on investments in media, financial services, energy, 20 | P a g e and industrial companies. The nature of the investments in this type is that distributions are received through the liquidation of the underlying assets of the fund. It is expected that the underlying assets of the fund would be liquidated over 10 to 13 years.

The fourth fund invests in global venture capital direct partnership investments. Investments are primarily core venture capital, with about 25% representing seed and early stage partnerships. It is estimated that 60% of investments will be in the US and 40% allocated to international groups.

Investments address a broad range of business opportunities primarily related to or enabled by technology. The fund may re-invest proceeds of portfolio investments; provided, however, that the acquisition costs of all portfolio investments will not exceed 115% of aggregate subscriptions, including secondary opportunities. Distributions are received through the liquidation of the underlying assets of the fund. It is expected that the underlying assets of the fund would be liquidated over 12 years.

(2) There are five investments in the floating rate debt category. The first is a fixed income fund that invests in actively managed investments in senior secured, floating rate assets and, to a limited degree, in secured bonds. The fund invests in a diversified portfolio of issuers in North America and Europe across a broad range of industries. Funds may be withdrawn monthly with 30 days written notice. The fund is open-ended.

The second and third investments are funds that invest in higher yielding private commercial real estate debt investments, including subordinate debt investments, such as mezzanine debt, b-notes, and senior mortgages, such as bridge loans and participating construction permanent loans.

Distributions of net cash flow to investors will be made on at least a quarterly basis, as available, and it is estimated that the underlying investments of the partnership would be liquidated over seven to 10 years.

The fourth investment is a fund that invests primarily in senior secured, floating rate middle market loans. Distributions of net income will be made on a quarterly basis, or more frequently at the General Partner’s discretion. It is expected that the underlying assets of the fund would be liquidated over 10 years.

The fifth investment is a fund that invests in higher yielding private commercial real estate debt investments, primarily senior mortgages and mezzanine investments. Distributions of net cash flow to investors will be made on at least a quarterly basis, as available. Funds may be withdrawn quarterly with 90 days written notice. This fund is open-ended.

(3) This fund invests in a well-diversified real estate portfolio that reflects the overall performance of the U.S. commercial real estate market, consisting primarily of high quality, well-leased real estate properties in the multifamily, industrial, office, retail, and hotel sectors. The fund is open ended, and funds may be withdrawn daily subject to the availability of liquidity and the absence of a withdrawal queue with one-day written notice.

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(4) Net Pension Liability

The components of the net pension liability of Metro at December 31, 2024 and 2023 are as follows:

December 31 2024 2023 Net Pension Liability:

Total pension liability $ 187,423,718 $ 183,000,282 Fiduciary net position 144,354,628 132,027,527 Net pension liability $ 43,069,090 $ 50,972,755 Fiduciary net position as a % of total pension liability 77.02% 72.15% Covered payroll $ 17,248,859 $ 17,140,732 Net pension liability as a % of covered payroll 249.69% 297.38%

(a) Actuarial Assumptions

The actuarial assumptions that determined the total pension liability as of December 31, 2024 and 2023 were based on the results of an actuarial experience study for the period 2010-2014 as well as various updates to actuarial experience between 2015 and 2023:

2024 2023

Actuarial valuation date January 1, 2025 January 1, 2024 Measurement Date December 31, 2024 December 31, 2023 Inflation 2.50% 2.50% Salary increases:

Price inflation 2.50% 2.50% Productivity 1.00% 1.00% Merit Age based Age based Mortality rate Pub-2010 Healthy Employee Pub-2010 Healthy Employee and Retiree Mortality Table for and Retiree Mortality Table for General Employees Projected General Employees Projected Generationally Using the Most Generationally Using the Most Recent MP Scale Published by Recent MP Scale Published by the Society of Actuaries on the Society of Actuaries on December 31, 2021 December 31, 2021

Investment rate of return 6.50% 6.50% Actuarial Cost Method Entry Age Normal Entry Age Normal

December 31,

(b) Long-term expected rate of return

The best-estimate range for the long-term expected rate of return is determined by adding expected inflation to expected long-term real returns and reflecting expected volatility and correlation. The capital market assumptions are per CAPTRUST’s investment consulting practice as of December 31, 2024. The long-term expected rate of return is as follows:

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Asset Class Target Allocation Long-Term Expected

Arithmetic Real Rate of Return

Public Equity 40% 8.45%

Private Equity 5% 11.91%

Fixed Rate Debt 30% 4.20%

Floating Rate Debt 10% 8.00%

Real Estate 15% 7.01%

(c) Discount rate

The discount rate used to measure the total pension liability was 6.50% in both 2024 and 2023. The projection of cash used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate that the Metro contribution will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

(d) Sensitivity of the net pension liability to changes in the discount rate

For 2024, the following presents the net pension liability of Metro, calculated using the discount rate of 6.50%, as well as what Metro’s net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.50%) or 1-percentage point higher (7.50%) than the current rate:

1% Decrease

(5.50%) Current Discount

Rate (6.50%) 1% Increase

(7.50%)

Net pension liability $ 64,114,414 $ 43,069,090 $ 25,194,546

For 2023, the following presents the net pension liability of Metro, calculated using the discount rate of 6.50%, as well as what Metro’s net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.50%) or 1-percentage point higher (7.50%) than the current rate:

1% Decrease

(5.50%) Current Discount

Rate (6.50%) 1% Increase

(7.50%)

Net pension liability $ 71,695,535 $ 50,972,755 $ 33,401,030

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(5) Risk Management

The Plan is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;

errors and omissions and natural disasters. Some losses are covered by Metro’s risk management policies and agreements. For other losses, commercial insurance has been purchased by the Plan. The Plan has not had claims on losses in the past three years.

(6) Related Parties

The Plan is governed by a Retirement Board of seven members, two of whom are covered under the Plan.

REQUIRED SUPPLEMENTARY INFORMATION

Required Supplementary Information

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Schedule of Changes in Net Pension Liability and Related Ratios (Unaudited) Ten Years Ended December 31, 2024

2024 2023 2022 2021 2020 2019 2018 2017 2016 2015

Total Pension Liability Service Cost 2,120,259$ 2,010,558$ 2,033,335$ 2,023,921$ 2,114,148$ 1,965,109$ 2,010,528$ 2,054,219$ 2,118,343$ 2,300,707$ Interest on total pension liability 11,678,913 11,188,723 10,809,667 10,660,366 10,312,587 9,690,475 9,316,712 8,968,077 8,516,917 8,048,386 Effect on plan changes - - - - - - - - - - Effect of economic /demographic (gains) or losses 1,688,337 3,977,737 3,741,653 2,849,251 1,602,483 1,710,776 1,035,325 1,588,268 1,723,846 (113,453) Effect of assumption changes or inputs - 568,291 - 9,076,232 - 8,032,806 - 3,286,291 - 5,444,418 Benefit payments (11,064,073) (9,586,425) (11,838,616) (9,403,818) (8,552,016) (7,240,476) (7,085,818) (6,758,280) (5,817,753) (5,757,870) Net change in total pension liability 4,423,436 8,158,884 4,746,039 15,205,952 5,477,202 14,158,690 5,276,747 9,138,575 6,541,353 9,922,188

Total pension liability, beginning 183,000,282 174,841,398 170,095,359 154,889,407 149,412,205 135,253,515 129,976,768 120,838,193 114,296,840 104,374,652 Total pension liability, ending (a) 187,423,718$ 183,000,282$ 174,841,398$ 170,095,359$ 154,889,407$ 149,412,205$ 135,253,515$ 129,976,768$ 120,838,193$ 114,296,840$

Fiduciary Net Position Employer contributions 11,584,570$ 10,053,490$ 8,385,864$ 8,115,278$ 6,219,293$ 5,700,935$ 5,019,996$ 4,756,434$ 4,228,249$ 4,722,308$ Member contributions 1,210,438 1,238,493 1,229,481 1,310,784 1,420,295 1,472,473 1,483,945 1,560,619 1,636,552 1,631,561 Investment income net of investment expenses 10,664,968 12,208,127 (15,831,532) 19,609,021 12,170,741 14,823,703 (2,770,025) 11,752,741 6,300,119 (244,970) Benefit payments (11,064,073) (9,586,425) (11,838,616) (9,403,818) (8,552,016) (7,240,476) (7,085,818) (6,758,280) (5,817,753) (5,757,870) Administrative expenses (68,802) (71,192) (62,518) (64,979) (63,397) (76,414) (48,345) (55,461) (46,271) (62,749) Net change in plan fiduciary net position 12,327,101 13,842,493 (18,117,321) 19,566,286 11,194,916 14,680,221 (3,400,247) 11,256,053 6,300,896 288,280

Fiduciary net position, beginning 132,027,527 118,185,034 136,302,355 116,736,069 105,541,153 90,860,932 94,261,179 83,005,126 76,704,230 76,415,950 Fiduciary net position, ending (b) 144,354,628$ 132,027,527$ 118,185,034$ 136,302,355$ 116,736,069$ 105,541,153$ 90,860,932$ 94,261,179$ 83,005,126$ 76,704,230$

Net pension liability, ending = (a) - (b) 43,069,090$ 50,972,755$ 56,656,364$ 33,793,004$ 38,153,338$ 43,871,052$ 44,392,583$ 35,715,589$ 37,833,067$ 37,592,610$

Fiduciary net position as a % of total pension liability 77.02% 72.15% 67.60% 80.13% 75.37% 70.64% 67.18% 72.52% 68.69% 67.11%

Covered payroll 17,248,859$ 17,140,732$ 17,228,409$ 19,580,679$ 20,312,130$ 20,599,400$ 20,935,048$ 23,351,010$ 23,323,075$ 23,834,625$

Net pension liability as of % of covered payroll 249.69% 297.38% 328.85% 172.58% 187.84% 212.97% 212.05% 152.95% 162.21% 157.72%

Fiscal Year Ending

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Fiscal Year Actuarially Actual Contribution Contribution Ending Determined Employer…