City of Clearwater Employees’ Pension Plan Actuarial Valuation Report as of January 1, 2026 Annual Employer Contribution for the Fiscal Year Ending September 30, 2027

April 20, 2026

Board of Trustees City of Clearwater Employees’ Pension Plan Clearwater, Florida

Dear Board Members:

The results of the January 1, 2026 Annual Actuarial Valuation of the City of Clearwater Employees’ Pension Plan are presented in this report.

This report was prepared at the request of the Board and is intended for use by the Retirement System and those designated or approved by the Board. This report may be provided to parties other than the System only in its entirety and only with the permission of the Board. GRS is not responsible for unauthorized use of this report.

The purposes of the valuation are to measure the System’s funding progress and to determine the employer contribution rate for the fiscal year ending September 30, 2027. This report should not be relied on for any purpose other than the purposes described herein. Determinations of financial results, associated with the benefits described in this report, for purposes other than those identified above may be significantly different.

The contribution rate in this report is determined using the actuarial assumptions and methods disclosed in Section B of this report. This report includes risk metrics in Section A, but does not include a robust assessment of future experience not meeting the actuarial assumptions. A robust assessment of risks was outside the scope of this assignment.

We have assessed that the contribution rate calculated under the current funding policy is a reasonable Actuarially Determined Employer Contribution (ADEC) and it is consistent with the System accumulating adequate assets to make benefit payments when due.

This valuation assumed the continuing ability of the plan sponsor to make the contributions necessary to fund this Plan. A determination regarding whether or not the plan sponsor is actually able to do so is outside our scope of expertise and was not performed.

The findings in this report are based on data or other information through December 31, 2025. The valuation was based upon information furnished by the City concerning Retirement System benefits, financial transactions, plan provisions and active members, terminated members, retirees and beneficiaries. We checked for internal and year-to-year consistency, but did not audit the data. We are not responsible for the accuracy or completeness of the information provided by the City.

Board of Trustees April 20, 2026 Page ii

In addition, this report was prepared using certain assumptions approved by the Board as authorized under the Florida and prescribed by the Florida Statutes as described in the section of this report entitled Actuarial Assumptions and Methods. The prescribed assumptions are the assumed mortality rates detailed in the Actuarial Assumptions and Methods section in accordance with Florida Statutes, Chapter 112.63. All actuarial assumptions used in this report are reasonable for purposes of this valuation. The combined effect of the assumptions, excluding the prescribed assumptions or methods set by law is expected to have no significant bias (i.e., not significantly optimistic or pessimistic).

This report was prepared using our proprietary valuation model and related software which in our professional judgment has the capability to provide results that are consistent with the purposes of the valuation and has no material limitations or known weaknesses. We performed tests to ensure that the model reasonably represents that which is intended to be modeled.

This report has been prepared by actuaries who have substantial experience valuing public employee retirement systems. To the best of our knowledge the information contained in this report is accurate and fairly presents the actuarial position of the Retirement System as of the valuation date. All calculations have been made in conformity with generally accepted actuarial principles and practices, with the Actuarial Standards of Practice issued by the Actuarial Standards Board and with applicable statutes.

Peter N. Strong and Trisha Amrose are members of the American Academy of Actuaries. These actuaries meet the Academy’s Qualification Standards to render the actuarial opinions contained herein. The signing actuaries are independent of the plan sponsor.

This actuarial valuation and/or cost determination was prepared and completed by us or under our direct supervision, and we acknowledge responsibility for the results. To the best of our knowledge, the results are complete and accurate. In our opinion, the techniques and assumptions used are reasonable, meet the requirements and intent of Part VII, Chapter 112, Florida Statutes, and are based on generally accepted actuarial principles and practices. There is no benefit or expense to be provided by the plan and/or paid from the plan’s assets for which liabilities or current costs have not been established or otherwise taken into account in the valuation. All known events or trends which may require a material increase in plan costs or required contribution rates have been taken into account in the valuation.

Gabriel, Roeder, Smith & Company will be pleased to review this valuation and Report with the Board of Trustees and to answer any questions pertaining to the valuation.

Respectfully submitted, GABRIEL, ROEDER, SMITH & COMPANY

Peter N. Strong, FSA, MAAA Trisha Amrose, MAAA Enrolled Actuary No. 26-6975 Enrolled Actuary No. 26-8010

City of Clearwater Employees’ Pension Plan

TABLE OF CONTENTS

Section Title Page

A Discussion of Valuation Results

1. Discussion of Valuation Results A-1

2. Risks Associated with Measuring the Accrued Liability and Actuarially Determined Contribution A-4

3. Low-Default-Risk Obligation Measure A-7

B Valuation Results

1. Participant Data B-1

2. Actuarially Determined Contribution (ADC) B-3

3. Actuarial Value of Benefits and Assets B-5

4. Calculation of Employer Normal Cost B-7

5. Reconciliation of Credit Balance B-9

6. Actuarial Gains and Losses B-10

7. Recent History of Valuation Results B-16

8. Recent History of Contributions B-17

9. Actuarial Assumptions and Cost Method B-18

10. Glossary of Terms B-31

C Pension Fund Information

1. Statement of Plan Assets at Market Value C-1

2. Reconciliation of Plan Assets C-2

3. Development of Actuarial Value of Assets C-3

4. Allocation of Plan Assets C-4

5. Investment Rate of Return C-5

D Financial Accounting Information

1. FASB No. 35 D-1

E Miscellaneous Information

1. Reconciliation of Membership Data E-1

2. Active Participant Distribution E-2

3. Inactive Participant Distribution E-6

F Summary of Plan Provisions F-1

SECTION A

DISCUSSION OF VALUATION RESULTS

City of Clearwater Employees’ Pension Plan A-1

DISCUSSION OF VALUATION RESULTS

Comparison of Required Employer Contributions

The required employer contribution developed in this year's valuation is compared below to last year's results:

Required Employer/State Contribution $ 12,366,780 $ 7,334,218 $ 5,032,562 As % of Covered Payroll 9.62 % 6.16 %* 3.46 %

Estimated State Contribution 12,000 12,000 0 As % of Covered Payroll 0.01 % 0.01 % 0.00 %

Required Employer Contribution 12,354,780 7,322,218 5,032,562 As % of Covered Payroll 9.61 % 6.15 % 3.46 %

Credit Balance 44,160,045 40,184,518 3,975,527

For FYE 9/30/2027 For FYE 9/30/2026 Based onBased on

Increase Valuation 1/1/20251/1/2026

Valuation (Decrease)

* Since the Actuarially Determined Contribution is under the 7% of payroll minimum, the required City contribution for FYE 2026 is 7% of payroll.

Required Employer Contribution by Group

The required employer contribution for each group developed in this year's valuation is shown below:

Required Employer Contribution by Group

Non-Hazardous $ 3,088,343 $ 1,993,122 $ 1,095,221 As % of Covered Payroll 3.98 % 2.68 % 1.30 %

Hazardous Police 4,355,583 2,469,397 1,886,186 As % of Covered Payroll 15.23 % 10.00 % 5.23 %

Hazardous Fire 4,910,854 2,859,699 2,051,155 As % of Covered Payroll 21.90 % 14.27 % 7.63 %

Total 12,354,780 7,322,218 5,032,562 As % of Covered Payroll 9.61 % 6.15 % 3.46 %

For FYE 9/30/2027 For FYE 9/30/2026

Valuation (Decrease)

Based on 1/1/2026 Increase

Based on 1/1/2025 Valuation

City of Clearwater Employees’ Pension Plan A-2

The contribution has been adjusted for interest on the basis that payments are made uniformly during the first two quarters of the City’s fiscal year. The required employer contribution has been computed under the assumption that the amount to be received from the State on behalf of police officers and firefighters in 2026 and 2027 will be $12,000. If the actual payment from the State falls below this amount, then the City must increase its contribution by the difference.

The actual Employer and State contributions during the year ending December 31, 2025 were $8,685,751 (reflecting the City’s minimum required contribution of 7% of covered payroll) and $12,000, respectively, for a total of $8,697,751. The actuarially determined contribution was $7,334,218. The resulting excess contribution of $1,363,533 was used to increase the credit balance.

The minimum required City contribution is 7% of covered payroll (by Ordinance).

Revisions in Benefits

There have been no revisions in benefits since the previous valuation.

Revisions in Actuarial Assumptions or Methods

There have been no revisions in assumptions or methods since the previous valuation.

Actuarial Experience

There was a net actuarial experience loss of $39,053,352 during the year, which means that actual experience was less favorable than expected. The loss is predominantly due to liability-related experience losses resulting from salary increase experience (salaries increased by 11.56% on average versus an expected average increase of 5.74%) and, to a much lesser extent, mortality experience (an actual decrease in annual retirement benefits of $845,596 versus an expected decrease of $1,330,967). Additionally, the recognized investment return (on the smoothed actuarial value of assets) was slightly below the assumed rate of 6.5%. The investment return on the market value of assets was 11.40%, but the return on the actuarial value of assets was 6.27% due to smoothing in the 2022 investment loss. Overall, the net loss caused the required employer contribution to increase by 3.60% of covered payroll.

Looking at each group, there was a net experience loss for Non-Hazardous Employees of $9,292,097, a net experience loss for Police Officers of $14,564,811, and a net experience loss of $15,196,444 for Firefighters. Differences in experience among the groups were primarily driven by higher than expected salary increases, which were relatively lower for Non-Hazardous Employees (6.5% versus 5.6% expected) but significantly higher for Police Officers (17.8% versus 6.0% expected) and Firefighters (22.5% versus 5.9% expected), resulting in larger losses for those groups.

City of Clearwater Employees’ Pension Plan A-3

Analysis of Change in Employer Contribution

The components of change in the required City contribution are as follows:

Contribution Rate Last Year 6.15 % Change in Benefits 0.00 Change in Assumptions and Methods 0.00 Actuarial Experience 3.60 Change in Administrative Expenses (0.14) Change in State Revenue 0.00

Contribution Rate This Year 9.61

Funded Ratio

One measure of the Plan’s funding progress is the ratio of the actuarial value of assets to the actuarial accrued liability. Including the credit balance in the actuarial value of assets, the funded ratio is 107.52% this year compared to 110.02% last year. Not including the credit balance in the actuarial value of assets, the funded ratio is 104.09% this year compared to 106.76% last year.

Variability of Future Contribution Rates

The Actuarial Cost Method used to determine the contribution rate is intended to produce contribution rates which are generally level as a percent of payroll. Even so, when experience differs from the assumptions, as it often does, the employer’s contribution rate can vary significantly from year-to-year.

The Market Value of Assets exceeds the Actuarial Value of Assets by $54,273,650 as of the valuation date (see Section C). This difference will be gradually recognized in the absence of offsetting losses.

Relationship to Market Value

If Market Value had been the basis for the valuation, the calculated required contribution rate would have been 4.91% (7.00% after reflecting the statutory minimum City contribution stated in the Ordinance) and the funded ratio (not including the credit balance) would have been 108.30%.

The funded ratio based on the market value of assets (excluding the credit balance) last year was 105.75%.

Conclusion

The remainder of this Report includes detailed actuarial valuation results, financial information, miscellaneous information and statistics, and a summary of plan provisions.

City of Clearwater Employees’ Pension Plan A-4

RISKS ASSOCIATED WITH MEASURING THE ACCRUED LIABILITY AND

ACTUARIALLY DETERMINED CONTRIBUTION

The determination of the accrued liability and the actuarially determined contribution requires the use of assumptions regarding future economic and demographic experience. Risk measures, as illustrated in this report, are intended to aid in the understanding of the effects of future experience differing from the assumptions used in the course of the actuarial valuation. Risk measures may also help with illustrating the potential volatility in the accrued liability and the actuarially determined contribution that result from the differences between actual experience and the actuarial assumptions.

Future actuarial measurements may differ significantly from the current measurements presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions due to changing conditions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period, or additional cost or contribution requirements based on the Plan’s funded status); and changes in plan provisions or applicable law. The scope of an actuarial valuation does not include an analysis of the potential range of such future measurements.

Examples of risk that may reasonably be anticipated to significantly affect the plan’s future financial condition include:

1. Investment risk – actual investment returns may differ from the expected returns;

2. Contribution risk – actual contributions may differ from expected future contributions. For example, actual contributions may not be made in accordance with the plan’s funding policy or material changes may occur in the anticipated number of covered employees, covered payroll, or other relevant contribution base;

3. Salary and Payroll risk – actual salaries and total payroll may differ from expected, resulting in actual future accrued liability and contributions differing from expected;

4. Longevity risk – members may live longer or shorter than expected and receive pensions for a period of time other than assumed;

5. Other demographic risks – members may terminate, retire or become disabled at times or with benefits other than assumed resulting in actual future accrued liability and contributions differing from expected.

The effects of certain trends in experience can generally be anticipated. For example, if the investment return since the most recent actuarial valuation is less (or more) than the assumed rate, the cost of the plan can be expected to increase (or decrease). Likewise, if longevity is improving (or worsening), increases (or decreases) in cost can be anticipated.

The computed contribution rate shown on page 1 may be considered as a minimum contribution rate that complies with the Board’s funding policy. The timely receipt of the actuarially determined contributions is critical to support the financial health of the plan. Users of this report should be aware that contributions made at the actuarially determined rate do not necessarily guarantee benefit security.

City of Clearwater Employees’ Pension Plan A-5

Plan Maturity Measures

Risks facing a pension plan evolve over time. A young plan with virtually no investments and paying few benefits may experience little investment risk. An older plan with a large number of members in pay status and a significant trust may be much more exposed to investment risk. Generally accepted plan maturity measures include the following:

1/1/2026 1/1/2025 Ratio of the market value of assets to total payroll 11.21 11.27 Ratio of actuarial accrued liability to payroll 10.03 10.34 Ratio of actives to retirees and beneficiaries 1.01 1.03 Ratio of net cash flow to market value of assets (3.59) % (3.00) %

Ratio of Market Value of Assets to Payroll

The relationship between assets and payroll is a useful indicator of the potential volatility of contributions. For example, if the market value of assets is 2.0 times the payroll, a return on assets 5% different than assumed would equal 10% of payroll. A higher (lower) or increasing (decreasing) level of this maturity measure generally indicates a higher (lower) or increasing (decreasing) volatility in plan sponsor contributions as a percentage of payroll.

Ratio of Actuarial Accrued Liability to Payroll

The relationship between actuarial accrued liability and payroll is a useful indicator of the potential volatility of contributions for a fully funded plan. A funding policy that targets a funded ratio of 100% is expected to result in the ratio of assets to payroll and the ratio of liability to payroll converging over time.

The ratio of liability to payroll may also be used as a measure of sensitivity of the liability itself. For example, if the actuarial accrued liability is 2.5 times the payroll, a change in liability 2% other than assumed would equal 5% of payroll. A higher (lower) or increasing (decreasing) level of this maturity measure generally indicates a higher (lower) or increasing (decreasing) volatility in liability (and also plan sponsor contributions) as a percentage of payroll.

Ratio of Actives to Retirees and Beneficiaries

A young plan with many active members and few retirees will have a high ratio of active to retirees.

A mature open plan may have close to the same number of actives to retirees resulting in a ratio near 1.0. A super-mature or closed plan may have significantly more retirees than actives resulting in a ratio below 1.0.

Ratio of Net Cash Flow to Market Value of Assets

A positive net cash flow means contributions exceed benefits and expenses. A negative cash flow means existing funds are being used to make payments. A certain amount of negative net cash flow is generally expected to occur when benefits are prefunded through a qualified trust. Large negative net cash flows as a percent of assets may indicate a super-mature plan or a need for additional contributions.

City of Clearwater Employees’ Pension Plan A-6

Additional Risk Assessment

Additional risk assessment is outside the scope of the annual actuarial valuation. Additional assessment may include scenario tests, sensitivity tests, stochastic modeling, stress tests, and a comparison of the present value of accrued benefits at low-risk discount rates with the actuarial accrued liability.

City of Clearwater Employees’ Pension Plan A-7

LOW-DEFAULT-RISK OBLIGATION MEASURE

Actuarial Standards of Practice No. 4 (ASOP No. 4) was revised and reissued in December 2021 by the Actuarial Standards Board (ASB). It includes a calculation called a low-default-risk obligation measure (LDROM) to be prepared and issued annually for defined benefit pension plans. The transmittal memorandum for ASOP No. 4 includes the following explanation:

“The ASB believes that the calculation and disclosure of this measure provides appropriate, useful information for the intended user regarding the funded status of a pension plan. The calculation and disclosure of this additional measure is not intended to suggest that this is the “right” liability measure for a pension plan. However, the ASB does believe that this additional disclosure provides a more complete assessment of a plan’s funded status and provides additional information regarding the security of benefits that members have earned as of the measurement date.”

The following information has been prepared in compliance with this requirement. Unless otherwise noted, the measurement date, actuarial cost methods, and assumptions used are the same as for the funding valuation covered in this actuarial valuation report.

A. Low-default-risk Obligation Measure of benefits earned as of the measurement date:

$1,571,132,079

B. Discount rate used to calculate the LDROM: 4.90% based on Fidelity’s “20‐Year Municipal GO AA Index” as of September 25, 2025

C. Other significant assumptions that differ from those used for the funding valuation: none

D. Actuarial cost method used to calculate the LDROM: Individual Entry-Age Actuarial Cost Method

E. Valuation procedures to value any significant plan provisions that are difficult to measure using traditional valuation procedures, and that differ from the procedures used in the funding valuation:

none

F. Commentary to help the intended user understand the significance of the LDROM with respect to the funded status of the plan, plan contributions, and the security of participant benefits: The LDROM is a market-based measurement of the pension obligation. It estimates the amount the plan would need to invest in low risk securities to provide the benefits with greater certainty. This measure may not be appropriate for assessing the need for or amount of future contributions. This measure may not be appropriate for assessing the sufficiency of plan assets to cover the estimated cost of settling the plan’s benefit obligation.

The difference between the two measures (Valuation and LDROM) is one illustration of the savings the sponsor anticipates by taking on the risk in a diversified portfolio.

SECTION B

VALUATION RESULTS

City of Clearwater Employees’ Pension Plan B-1

ACTIVE MEMBERS

Number 1,563 1,139 239 185 Covered Annual Payroll $ 128,548,670 $ 77,527,882 $ 28,597,883 $ 22,422,905 Average Annual Payroll $ 82,245 $ 68,067 $ 119,656 $ 121,205 Average Age 43.1 44.5 38.2 40.4 Average Past Service 9.6 9.1 10.0 11.8 Average Age at Hire 33.5 35.4 28.2 28.6

RETIREES & BENEFICIARIES

Number 1,434 903 312 219 Annual Benefits $ 61,370,744 $ 33,673,194 $ 16,779,979 $ 10,917,571 Average Annual Benefit $ 42,797 $ 37,290 $ 53,782 $ 49,852 Average Age 69.7 71.4 65.9 67.8

DISABILITY RETIREES

Number 120 28 50 42 Annual Benefits $ 4,741,139 $ 654,658 $ 2,387,265 $ 1,699,216 Average Annual Benefit $ 39,509 $ 23,381 $ 47,745 $ 40,458 Average Age 65.6 73.6 60.0 66.9

TERMINATED VESTED MEMBERS

Number 92 79 6 7 Annual Benefits $ 1,922,296 $ 1,520,531 $ 228,072 $ 173,693 Average Annual Benefit $ 20,895 $ 19,247 $ 38,012 $ 24,813 Average Age 50.4 51.0 49.6 43.5

PARTICIPANT DATA

January 1, 2026

Total Non-Hazardous Hazardous Police Hazardous Fire

City of Clearwater Employees’ Pension Plan B-2

ACTIVE MEMBERS

Number 1,572 1,145 235 192 Covered Annual Payroll $ 119,120,727 $ 74,396,606 $ 24,687,401 $ 20,036,720 Average Annual Payroll $ 75,777 $ 64,975 $ 105,053 $ 104,358 Average Age 43.1 44.4 38.2 41.1 Average Past Service 9.5 9.0 10.1 12.0 Average Age at Hire 33.6 35.4 28.1 29.1

RETIREES & BENEFICIARIES

Number 1,406 893 308 205 Annual Benefits $ 58,897,958 $ 32,712,424 $ 16,168,334 $ 10,017,200 Average Annual Benefit $ 41,890 $ 36,632 $ 52,495 $ 48,864 Average Age 69.2 70.9 65.3 68.0

DISABILITY RETIREES

Number 117 28 49 40 Annual Benefits $ 4,445,653 $ 638,547 $ 2,241,538 $ 1,565,568 Average Annual Benefit $ 37,997 $ 22,805 $ 45,746 $ 39,139 Average Age 65.8 73.8 60.4 66.9

TERMINATED VESTED MEMBERS

Number 91 75 7 9 Annual Benefits $ 1,850,372 $ 1,376,043 $ 237,023 $ 237,306 Average Annual Benefit $ 20,334 $ 18,347 $ 33,860 $ 26,367 Average Age 49.2 49.7 48.1 45.7

PARTICIPANT DATA - PRIOR YEAR

January 1, 2025

City of Clearwater Employees’ Pension Plan B-3

A. Valuation Date

B. ADC to Be Paid During Fiscal Year Ending 9/30/2027 9/30/2027 9/30/2027 9/30/2027

C. Assumed Date of Employer Contrib. Evenly during Evenly during Evenly during Evenly during first two quarters first two quarters first two quarters first two quarters of fiscal year of fiscal year of fiscal year of fiscal year D. Annual Payment to Amortize

Unfunded Actuarial Liability $ 0 $ 0 $ 0 $ 0

E. Employer Normal Cost 11,612,000 2,899,853 4,096,322 4,615,825

F. ADC if Paid on the Valuation Date: D+E 11,612,000 2,899,853 4,096,322 4,615,825

G. ADC Adjusted for Frequency of Payments 12,366,780 3,088,343 4,362,583 4,915,854

H. ADC as % of Covered Payroll 9.62 % 3.98 % 15.25 % 21.92 %

I. Assumed Rate of Increase in Covered Payroll to Contribution Year 0.00 % 0.00 % 0.00 % 0.00 %

J. Covered Payroll for Contribution Year 128,548,670 77,527,882 28,597,883 22,422,905

K. ADC for Contribution Year: H x J 12,366,780 3,088,343 4,362,583 4,915,854

L. Estimate of State Revenue in Contribution Year 12,000 0 7,000 5,000

M. Required Employer Contribution (REC) in Contribution Year 12,354,780 3,088,343 4,355,583 4,910,854

N. REC as % of Covered Payroll in Contribution Year: M ÷ J 9.61 % 3.98 % 15.23 % 21.90 %

O. Credit Balance 44,160,045 21,152,690 14,368,500 8,638,855

Total Non-Hazardous Hazardous Police Hazardous Fire January 1, 2026 January 1, 2026 January 1, 2026 January 1, 2026

ACTUARIALLY DETERMINED CONTRIBUTION (ADC)

City of Clearwater Employees’ Pension Plan B-4

B. ADC to Be Paid During Fiscal Year Ending 9/30/2026 9/30/2026 9/30/2026 9/30/2026

C. Assumed Date of Employer Contrib. Evenly during Evenly during Evenly during Evenly during first two quarters first two quarters first two quarters first two quarters of fiscal year of fiscal year of fiscal year of fiscal year D. Annual Payment to Amortize

Unfunded Actuarial Liability $ 0 $ 0 $ 0 $ 0

E. Employer Normal Cost 6,886,589 1,871,476 2,325,255 2,689,858

F. ADC if Paid on the Valuation Date: D+E 6,886,589 1,871,476 2,325,255 2,689,858

G. ADC Adjusted for Frequency of Payments 7,334,218 1,993,122 2,476,397 2,864,699

H. ADC as % of Covered Payroll 6.16 % 2.68 % 10.03 % 14.30 %

I. Assumed Rate of Increase in Covered Payroll to Contribution Year 0.00 % 0.00 % 0.00 % 0.00 %

J. Covered Payroll for Contribution Year 119,120,727 74,396,606 24,687,401 20,036,720

K. ADC for Contribution Year: H x J 7,334,218 1,993,122 2,476,397 2,864,699

L. Estimate of State Revenue in Contribution Year 12,000 0 7,000 5,000

M. Required Employer Contribution (REC) in Contribution Year 7,322,218 1,993,122 2,469,397 2,859,699

N. REC as % of Covered Payroll in Contribution Year: M ÷ J 6.15 % 2.68 % 10.00 % 14.27 %

O. Credit Balance 40,184,518 19,382,181 12,489,649 8,312,688

ACTUARIALLY DETERMINED CONTRIBUTION (ADC) - PRIOR YEAR

January 1, 2025 January 1, 2025 January 1, 2025 January 1, 2025

City of Clearwater Employees’ Pension Plan B-5

B. Actuarial Present Value of All Projected Benefits for

1. Active Members

a. Service Retirement Benefits $ 581,686,495 $ 269,277,990 $ 159,765,555 $ 152,642,950

b. Vesting Benefits 74,628,396 54,224,993 13,869,976 6,533,427

c. Disability Benefits 26,691,391 3,557,680 14,956,920 8,176,791

d. Preretirement Death Benefits 6,139,177 4,271,687 982,169 885,321

e. Return of Member Contributions 3,604,590 2,024,875 1,062,907 516,808

f. Total 692,750,049 333,357,225 190,637,527 168,755,297

2. Inactive Members

a. Service Retirees & Beneficiaries 779,434,194 401,427,123 235,804,792 142,202,279

b. Disability Retirees 63,492,398 6,376,632 35,108,264 22,007,502

c. Terminated Vested Members 21,562,256 16,022,548 3,210,094 2,329,614

d. Total 864,488,848 423,826,303 274,123,150 166,539,395

3. Total for All Members 1,557,238,897 757,183,528 464,760,677 335,294,692

C. Actuarial Accrued (Past Service) Liability 1,289,676,829 643,520,523 378,496,864 267,659,442

D. Actuarial Value of Accumulated Plan Benefits per FASB No. 35 1,171,031,792 571,097,032 356,413,560 243,521,200

E. Plan Assets

1. Market Value 1,440,897,418 722,989,645 426,185,894 291,721,879

2. Actuarial Value 1,386,623,768 695,757,112 410,132,937 280,733,719

3. Actuarial Value Excluding Credit Balance 1,342,463,723 674,604,422 395,764,437 272,094,864

F. Actuarial Present Value of Projected Covered Payroll 1,210,507,106 714,776,706 287,274,384 208,456,016

G. Actuarial Present Value of Projected Member Contributions 106,755,179 57,182,138 28,727,439 20,845,602

H. Accumulated Value of Active Member Contributions 73,363,463 38,473,379 18,534,355 16,355,729

I. Unfunded Actuarial Accrued Liability (UAAL) Based on EAN Method = C. - E.3. (52,786,894) (31,083,899) (17,267,573) (4,435,422)

J. Funded Ratio = E.2. / C. 107.52% 108.12% 108.36% 104.88%

K. Funded Ratio Excluding Credit Balance = E.3. / C. 104.09% 104.83% 104.56% 101.66%

Total Non-Hazardous Hazardous Police Hazardous Fire

ACTUARIAL VALUE OF BENEFITS AND ASSETS

City of Clearwater Employees’ Pension Plan B-6

B. Actuarial Present Value of All Projected Benefits for

1. Active Members

a. Service Retirement Benefits $ 537,149,762 $ 256,169,289 $ 141,844,119 $ 139,136,354

b. Vesting Benefits 67,906,163 50,159,073 11,935,877 5,811,213

c. Disability Benefits 23,816,810 3,306,374 12,965,568 7,544,868

d. Preretirement Death Benefits 5,738,970 4,049,455 864,243 825,272

e. Return of Member Contributions 3,429,713 1,994,687 941,044 493,982

f. Total 638,041,418 315,678,878 168,550,851 153,811,689

2. Inactive Members

a. Service Retirees & Beneficiaries 755,530,590 394,849,712 229,985,387 130,695,491

b. Disability Retirees 59,002,519 6,188,340 32,557,891 20,256,288

c. Terminated Vested Members 20,509,042 13,922,161 3,105,769 3,481,112

d. Total 835,042,151 414,960,213 265,649,047 154,432,891

3. Total for All Members 1,473,083,569 730,639,091 434,199,898 308,244,580

C. Actuarial Accrued (Past Service) Liability 1,231,642,076 622,604,546 360,614,288 248,423,242

D. Actuarial Value of Accumulated Plan Benefits per FASB No. 35 1,128,934,142 552,054,698 344,329,305 232,550,139

E. Plan Assets

1. Market Value 1,342,584,640 674,536,786 396,535,201 271,512,653

2. Actuarial Value 1,355,029,043 680,789,060 400,210,682 274,029,301

3. Actuarial Value Excluding Credit Balance 1,314,844,525 661,406,879 387,721,033 265,716,613

F. Actuarial Present Value of Projected Covered Payroll 1,105,193,966 675,202,724 245,287,809 184,703,433

G. Actuarial Present Value of Projected Member Contributions 97,015,343 54,016,218 24,528,781 18,470,344

H. Accumulated Value of Active Member Contributions 70,149,013 36,234,195 17,525,198 16,389,620

I. Unfunded Actuarial Accrued Liability (UAAL) Based on EAN Method = C. - E.3. (83,202,449) (38,802,333) (27,106,745) (17,293,371)

J. Funded Ratio = E.2. / C. 110.02% 109.35% 110.98% 110.31%

K. Funded Ratio Excluding Credit Balance = E.3. / C. 106.76% 106.23% 107.52% 106.96%

Total Non-Hazardous Hazardous Police Hazardous Fire

ACTUARIAL VALUE OF BENEFITS AND ASSETS - PRIOR YEAR

City of Clearwater Employees’ Pension Plan B-7

B. Actuarial Present Value of Projected Benefits $ 1,557,238,897 $ 757,183,528 $ 464,760,677 $ 335,294,692

C. Actuarial Value of Assets Excluding Credit Balance 1,342,463,723 674,604,422 395,764,437 272,094,864

D. Actuarial Present Value of Projected Member Contributions 106,755,179 57,182,138 28,727,439 20,845,602

E. Actuarial Present Value of Projected Employer Normal Costs: B-C-D 108,019,995 25,396,968 40,268,801 42,354,226

F. Actuarial Present Value of Projected Covered Payroll 1,210,507,106 714,776,706 287,274,384 208,456,016

G. Employer Normal Cost Rate: E/F 8.92 % 3.55 % 14.02 % 20.32 %

H. Covered Annual Payroll 128,548,670 77,527,882 28,597,883 22,422,905

I. Employer Normal Cost: G x H 11,317,997 2,752,240 4,009,423 4,556,334

J. Assumed Amount of Administrative Expenses 294,003 147,613 86,899 59,491

K. Total Employer Normal Cost: I+J 11,612,000 2,899,853 4,096,322 4,615,825

L. Employer Normal Cost as % of

Covered Payroll 9.03 % 3.74 % 14.32 % 20.59 %

Hazardous Police Hazardous Fire

CALCULATION OF EMPLOYER NORMAL COST

AGGREGATE METHOD

Total Non-Hazardous

City of Clearwater Employees’ Pension Plan B-8

B. Actuarial Present Value of Projected Benefits $ 1,473,083,569 $ 730,639,091 $ 434,199,898 $ 308,244,580

C. Actuarial Value of Assets Excluding Credit Balance 1,314,844,525 661,406,879 387,721,033 265,716,613

D. Actuarial Present Value of Projected Member Contributions 97,015,343 54,016,218 24,528,781 18,470,344

E. Actuarial Present Value of Projected Employer Normal Costs: B-C-D 61,223,701 15,215,994 21,950,084 24,057,623

F. Actuarial Present Value of Projected Covered Payroll 1,105,193,966 675,202,724 245,287,809 184,703,433

G. Employer Normal Cost Rate: E/F 5.54 % 2.25 % 8.95 % 13.03 %

H. Covered Annual Payroll 119,120,727 74,396,606 24,687,401 20,036,720

I. Employer Normal Cost: G x H 6,494,231 1,673,924 2,209,522 2,610,785

J. Assumed Amount of Administrative Expenses 392,358 197,552 115,733 79,073

K. Total Employer Normal Cost: I+J 6,886,589 1,871,476 2,325,255 2,689,858

L. Employer Normal Cost as % of

Covered Payroll 5.78 % 2.52 % 9.42 % 13.42 %

Hazardous Police Hazardous Fire

CALCULATION OF EMPLOYER NORMAL COST - PRIOR YEAR

AGGREGATE METHOD

Total Non-Hazardous

City of Clearwater Employees’ Pension Plan B-9

$ 40,184,518 $ 19,382,181 $ 12,489,649 $ 8,312,688

- 7,322,218 - 1,993,122 - 2,469,397 - 2,859,699

+ 8,685,751 + 2,503,789 + 3,536,421 + 2,645,541

+ 2,611,994 + 1,259,842 + 811,827 + 540,325

44,160,045 21,152,690 14,368,500 8,638,855

Interest on Credit Balance

Credit Balance at End of Year

Credit Balance at Beginning of Year

Required Employer Contribution

Employer Contribution Made

Reconcilation of Credit Balance

City of Clearwater Employees’ Pension Plan B-10

ACTUARIAL GAINS AND LOSSES

The assumptions used to anticipate mortality, employment turnover, investment income, expenses, salary increases, and other factors have been based on long range trends and expectations.

Actual experience can vary from these expectations. The variance is measured by the gain and loss for the period involved. If significant long-term experience reveals consistent deviation from what has been expected and that deviation is expected to continue, the assumptions should be modified. The net actuarial gain (loss) for the past year is computed as follows:

A. Employer Normal Cost Percentage

1. Last Valuation 2.25 % 8.95 % 13.03 %

2. Current Valuation (Before Changes) 3.55 14.02 20.32

3. Difference: 1 - 2 (1.30) (5.07) (7.29)

B. Present Value of Future Salary $ 1,210,507,106 $ 714,776,706 $ 287,274,384 $ 208,456,016

C. Net Actuarial Gain (Loss): A3 x B (39,053,352) (9,292,097) (14,564,811) (15,196,444)

D. Gain (Loss) Due to Investments (2,949,538)

E. Gain (Loss) Due to Other Causes (36,103,814)

Non-Hazardous Hazardous Police Hazardous FireTotal

City of Clearwater Employees’ Pension Plan B-11

Gains (losses) in previous years have been as follows:

Year Ending Gain 12/31 (Loss)

2009 $32,358,262 (4.89) % 2010 2,311,412 (0.37) 2011 (13,721,771) 2.28 2012 (7,015,253) 1.15 2013 62,452,347 (11.02) 2014 34,213,347 (6.01) 2015 (475,313) 0.07 ** 2016 18,096,188 (2.51) ** 2017 11,075,148 (1.48) ** 2018 (5,803,978) 0.75 ** 2019 1,188,833 (0.14) ** 2020 45,746,487 (5.30) ** 2021 65,543,127 (7.43) ** 2022 (21,868,907) 2.30 ** 2023 (3,947,385) 0.37 ** 2024 (3,983,797) 0.36 ** 2025 (39,053,352) (3.38)

Employer Cost Rate*

Change in

* Before 2015 and in 2025, Change in Normal Cost Rate.

** Before reflecting Chapter 112.66 of the Florida Statutes. Since the annual payment to amortize the UAAL is less than $0, the net effect of these gains and losses on the required employer contribution is $0 or limited after reflecting Chapter 112.66 of the Florida Statutes (the requirement to fund at least the normal cost).

City of Clearwater Employees’ Pension Plan B-12

The fund earnings and salary increase assumptions have considerable impact on the cost of the Plan so it is important that they are in line with the actual experience. The following table shows the actual fund earnings and salary increase rates compared to the assumed rates for the last few years:

12/31/1986 N/A 7.00 % 7.40 % 5.00 % 12/31/1987 N/A 7.00 5.90 5.00 12/31/1988 N/A 7.00 9.10 5.00 12/31/1989 N/A 7.00 8.70 5.00 12/31/1990 N/A 7.00 5.30 5.00

12/31/1991 N/A 7.00 6.10 5.00 12/31/1992 N/A 7.00 6.80 5.00 12/31/1993 7.42 % 7.00 1.20 5.00 12/31/1994 6.28 7.00 4.40 5.00 12/31/1995 9.14 7.00 6.40 5.00

12/31/1996 11.54 7.00 6.70 5.00 12/31/1997 13.74 7.00 5.60 5.00 12/31/1998 15.28 7.00 7.40 5.00 12/31/1999 17.96 7.00 4.20 5.00 12/31/2000 12.42 7.00 5.80 5.00

12/31/2001 7.40 7.00 5.90 5.00 12/31/2002 (1.85) 7.50 5.80 6.00 12/31/2003 7.45 7.50 6.40 6.00 12/31/2004 2.18 7.50 6.38 6.00 12/31/2005 4.58 7.50 5.49 6.00

12/31/2006 7.87 7.50 5.15 6.00 12/31/2007 10.68 7.50 6.62 6.00 12/31/2008 (10.61) 7.50 4.25 6.00 12/31/2009 16.53 7.50 3.29 6.00 12/31/2010 5.98 7.50 1.27 6.00

12/31/2011 4.46 7.50 2.56 6.00 12/31/2012 5.50 7.50 4.48 6.00 12/31/2013 14.04 7.00 3.16 4.07 12/31/2014 11.04 7.00 3.38 4.04 12/31/2015 7.64 7.00 8.65 * 4.09

12/31/2016 8.22 7.00 1.23 * 4.13 12/31/2017 8.89 7.00 7.35 4.16 12/31/2018 5.76 7.00 4.08 4.18 12/31/2019 7.39 6.75 8.84 4.35 12/31/2020 11.10 6.65 6.05 4.30

12/31/2021 12.46 6.55 6.37 4.24 12/31/2022 6.08 6.50 9.16 4.32 12/31/2023 7.56 6.50 8.42 4.39 12/31/2024 6.51 6.50 7.85 5.74 12/31/2025 6.27 6.50 11.56 5.74

Averages 7.96 % --- 5.84 % ---

Salary Increases Actual

Investment Return Year Ending Actual Assumed Assumed

* Salary for the year ending 12/31/2015 included 27 pay periods rather than 26.

The actual investment return rates shown above are based on the actuarial value of assets. The actual salary increase rates shown above are the increases received by those active members who were included in the actuarial valuations both at the beginning and the end of each year.

City of Clearwater Employees’ Pension Plan B-13

History of Investment Return Based on Actuarial Value of Assets

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

Plan Year End

Actual Assumed

History of Salary Increases

0%

5%

10%

15%

0%

5%

10%

15%

Plan Year End Compared to Previous Year

Actual Assumed

City of Clearwater Employees’ Pension Plan B-14

Active Members

Year Vested Other End of Ended A E A E A E A E A A A E Year

12/31/2009 49 110 54 57 0 6 0 2 10 46 56 93 1,567 12/31/2010 78 137 68 51 2 6 3 2 15 49 64 85 1,508 12/31/2011 84 124 43 49 6 6 0 2 11 64 75 84 1,468 12/31/2012 119 113 51 52 3 6 1 2 18 40 58 81 1,474 12/31/2013 102 98 27 42 2 3 4 2 11 54 65 79 1,478 12/31/2014 135 131 45 51 5 3 2 2 21 58 79 78 1,482 12/31/2015 145 122 43 52 7 3 1 2 18 53 71 82 1,505 12/31/2016 159 144 49 60 4 3 2 3 18 71 89 89 1,520 12/31/2017 164 161 47 59 2 3 2 2 25 85 110 91 1,523 12/31/2018 207 175 45 65 1 3 0 2 27 102 129 92 1,555 12/31/2019 164 148 38 52 3 4 1 2 13 93 106 99 1,571 12/31/2020 105 135 43 52 0 4 0 2 8 84 92 100 1,541 12/31/2021 168 199 55 56 1 4 2 1 18 123 141 92 1,510 12/31/2022 195 199 59 54 4 4 0 1 20 116 136 90 1,506 12/31/2023 237 187 52 55 2 4 3 1 47 83 130 94 1,556 12/31/2024 179 163 40 46 0 3 2 1 21 100 121 118 1,572 12/31/2025 160 169 41 49 3 3 1 1 27 97 124 121 1,563 12/31/2026 51 3 1 116

17 Yr Totals * 2,450 2,515 800 902 45 68 24 30 328 1,318 1,646 1,568

* Totals are through current Plan Year only.

Terminations Year Retirement Retirement Death Totals

During Service Disability

Actual (A) Compared to Expected (E) Decrements Among Active Employees

Number Added

City of Clearwater Employees’ Pension Plan B-15

Year Ended Number Number

12/31/2009 12 $ 142,606 16 $ 313,189 12/31/2010 12 139,508 18 363,242 12/31/2011 13 220,877 19 416,467 12/31/2012 12 232,755 20 466,010 12/31/2013 20 401,192 20 480,787 12/31/2014 16 275,728 21 510,892 12/31/2015 19 385,405 22 558,603 12/31/2016 20 498,746 25 708,907 12/31/2017 15 288,110 26 753,482 12/31/2018 25 762,324 28 831,241 12/31/2019 20 566,781 28 885,857 12/31/2020 27 921,472 29 949,503 12/31/2021 25 781,255 32 1,073,271 12/31/2022 37 (18 with continuing beneficaries )

760,803 34 1,160,759

12/31/2023 30 (12 with continuing beneficaries )

602,465 36 1,270,428

12/31/2024 44 (18 with continuing beneficaries )

746,686 38 1,395,938

12/31/2025 41 (15 with continuing beneficaries )

845,596 35 1,330,967

12/31/2026 37 1,450,514

Actual (A) Compared to Expected (E) Deaths Among Retirees and Beneficiaries

Actual During Year Annual

Pensions Annual

Pensions

Expected During Year

City of Clearwater Employees’ Pension Plan B-16

Active Members

Inactive Members

1/1/07 1,692 819 $ 79,385,090 $ 559,830,590 N/A N/A N/A $ 9,192,407 11.58 %

1/1/08 1,641 878 80,371,617 610,979,087 N/A N/A N/A 6,920,400 8.61

1/1/09 1,628 903 82,104,837 536,834,473 N/A N/A N/A 20,005,238 24.37

1/1/10 1,567 955 80,443,199 618,444,906 $ 647,167,565 $ 28,722,659 95.6 % 15,879,628 19.74

1/1/11 1,508 1,024 76,505,599 646,956,800 672,786,812 25,830,012 96.2 15,461,725 20.21

1/1/12 1,468 1,072 74,765,020 664,087,199 702,438,432 38,351,233 94.5 17,064,100 22.82

1/1/13 1,474 1,127 74,422,344 688,731,221 774,749,811 86,018,590 88.9 12,845,501 17.26

1/1/14 1,478 1,144 74,254,159 772,411,068 795,927,127 23,516,059 97.0 4,626,039 6.23

1/1/15 1,482 1,194 75,078,542 829,486,793 824,274,144 (5,212,649) 100.6 8,194,115 10.91

1/1/16 1,505 1,237 80,250,993 866,598,975 857,177,619 (9,421,356) 101.1 8,358,975 10.42

1/1/17 1,520 1,278 79,276,100 908,229,246 880,316,652 (27,912,594) 103.2 8,092,922 10.21

1/1/18 1,523 1,334 82,317,307 957,314,542 916,334,666 (40,979,876) 104.5 8,236,726 10.01

1/1/19 1,555 1,374 84,608,940 978,492,240 965,611,907 (12,880,333) 101.3 9,106,282 10.76

1/1/20 1,571 1,401 90,594,113 1,015,277,332 1,017,746,535 2,469,203 99.8 10,463,285 11.55

1/1/21 1,541 1,422 92,726,419 1,093,182,410 1,034,718,990 (58,463,420) 105.7 10,711,397 11.55

1/1/22 1,510 1,469 94,070,686 1,190,146,409 1,076,740,942 (113,405,467) 110.5 12,017,928 12.78

1/1/23 1,506 1,529 101,042,598 1,222,735,789 1,123,775,534 (98,960,255) 108.8 12,723,459 12.59

1/1/24 1,556 1,587 112,602,359 1,273,100,381 1,170,789,378 (102,311,003) 108.7 15,253,281 13.55

1/1/25 1,572 1,614 119,120,727 1,314,844,525 1,231,642,076 (83,202,449) 106.8 6,886,589 5.78

1/1/26 1,563 1,646 128,548,670 1,342,463,723 1,289,676,829 (52,786,894) 104.1 11,612,000 9.03

Unfunded Actuarial Liability

(Entry Age)*

RECENT HISTORY OF VALUATION RESULTS

Number of Employer Normal Cost*

Valuation Date

Covered Annual Payroll

Actuarial Value of Assets % of PayrollAmount

Actuarial Accrued Liability

(Entry Age) Funded

Ratio

* Starting with the January 1, 2015 valuation, the Credit Balance is excluded from the Actuarial Value of Assets. For the January 1, 2015 through the January 1, 2024 valuations, the Employer Normal Cost is calculated under the Entry Age Normal Method.

Results before January 1, 2010 are from the January 1, 2009 Report prepared by PricewaterhouseCoopers.

City of Clearwater Employees’ Pension Plan B-17

1/1/07 9/30/08 $ 12,532,399 15.79 % $ 12,000 0.02 % $ 12,520,399 15.77 % $ 12,520,399 $ 12,000 $ 12,532,399 1/1/08 9/30/09 10,086,978 12.55 12,000 0.01 10,074,978 12.54 10,074,978 12,000 10,086,978 1/1/09 9/30/10 23,960,586 29.18 12,000 0.01 23,948,586 29.17 23,948,586 12,000 23,960,586 1/1/10 9/30/11 19,373,992 24.08 12,000 0.01 19,361,992 24.07 19,361,992 12,000 19,373,992 1/1/11 9/30/12 18,898,567 24.70 12,000 0.01 18,886,567 24.69 18,886,567 12,000 18,898,567

1/1/12 9/30/13 20,925,720 27.99 12,000 0.02 20,913,720 27.97 20,913,720 12,000 20,925,720 1/1/13 9/30/14 19,608,078 26.35 12,000 0.02 19,596,078 26.33 19,596,078 12,000 19,608,078 1/1/14 9/30/15 10,803,098 14.55 12,000 0.02 10,791,098 14.53 10,791,098 12,000 10,803,098 1/1/15 9/30/16 8,767,703 11.68 12,000 0.02 8,755,703 11.66 8,755,703 12,000 8,767,703 1/1/16 9/30/17 8,944,103 11.15 12,000 0.02 8,932,103 11.13 8,932,103 12,000 8,944,103

1/1/17 9/30/18 8,659,427 10.92 12,000 0.01 8,647,427 10.91 8,647,427 12,000 8,659,427 1/1/18 9/30/19 8,813,297 10.71 12,000 0.02 8,801,297 10.69 8,801,297 12,000 8,813,297 1/1/19 9/30/20 9,720,956 11.49 12,000 0.01 9,708,956 11.48 9,708,956 12,000 9,720,956 1/1/20 9/30/21 11,534,013 12.73 12,000 0.01 11,522,013 12.72 11,522,013 12,000 11,534,013 1/1/21 9/30/22 11,412,994 12.31 12,000 0.01 11,400,994 12.30 11,400,994 12,000 11,412,994

1/1/22 9/30/23 12,799,094 13.61 12,000 0.02 12,787,094 13.59 12,787,094 12,000 12,799,094 1/1/23 9/30/24 13,550,484 13.41 12,000 0.01 13,538,484 13.40 13,538,484 12,000 13,550,484 1/1/24 9/30/25 16,244,745 14.43 12,000 0.01 16,232,745 14.42 16,232,745 12,000 16,244,745 1/1/25 9/30/26 7,334,218 6.16 12,000 0.01 7,322,218 6.15 7,322,218 12,000 7,334,218 1/1/26 9/30/27 12,366,780 9.62 12,000 0.01 12,354,780 9.61 --- --- ---

% of Payroll Employer State

Valuation Date

End of Year To Which Valuation

Applies Amount

Actual Contributions

% of Payroll TotalAmount % of

PayrollAmount

RECENT HISTORY OF REQUIRED AND ACTUAL CONTRIBUTIONS

Estimated State

Required Contributions

Employer & State Net Employer

Results before January 1, 2010 are from the January 1, 2009 Report prepared by PricewaterhouseCoopers.

City of Clearwater Employees’ Pension Plan B-18

ACTUARIAL ASSUMPTIONS AND COST METHOD

Valuation Methods

Actuarial Cost Method - Normal cost and the allocation of benefit values between service rendered before and after the valuation date were determined using the Aggregate Method. The excess of the Actuarial Present Value of Projected Benefits of the group included in the valuation, over the sum of the Actuarial Value of Assets and the Actuarial Present Value of Future Member Contributions (if any) is allocated as a level percentage of earnings of the group between the valuation date and the assumed retirement age. This allocation is performed for the group as a whole, not as a sum of individual allocations. The portion of this Actuarial Present Value allocated to a specific year is called the Employer Normal Cost.

Under this method, actuarial gains and losses, plan amendments, and changes in actuarial assumptions and methods reduce or increase future Normal Costs.

Actuarial Value of Assets - The Actuarial Value of Assets phase in the difference between the expected and actual return on market value of assets at the rate of 20% per year. The Actuarial Value of Assets will be further adjusted to the extent necessary to fall within the corridor whose lower limit is 80% of the Market Value of plan assets and whose upper limit is 120% of the Market Value of plan assets. During periods when investment performance exceeds the assumed rate, Actuarial Value of Assets will tend to be less than Market Value. During periods when investment performance is less than assumed rate, Actuarial Value of Assets will tend to be greater than Market Value.

Valuation Assumptions

The actuarial assumptions used in the valuation are shown in this Section. Both the economic and decrement assumptions were established following the Experience Investigation for the Five Years Ended December 31, 2022, dated September 29, 2023. The mortality assumption is mandated by Chapter 112.63, Florida Statutes.

Economic Assumptions

The investment return rate assumed in the valuation is 6.5% per year, compounded annually (net rate after investment expenses).

The Inflation Rate assumed in this valuation is 2.40% per year. The Inflation Rate is defined to be the expected long-term rate of increases in the prices of goods and services. This assumption was changed this year (based on the results of a 5‐year experience study) from 2.25%.

The assumed real rate of return over inflation is defined to be the portion of total investment return that is more than the assumed inflation rate. Considering other economic assumptions, the 6.5% investment return rate translates to an assumed real rate of return over inflation of 4.10%.

City of Clearwater Employees’ Pension Plan B-19

The rate of salary increase used for individual members can be seen in the tables below. Part of the assumption is for merit and/or seniority increases and productivity increases, and 2.40% recognizes inflation. This assumption is used to project a member’s current salary to the salaries upon which benefits will be based.

Years of Service Under 5 2.40% 7.75%

5 - 14 2.40% 6.40% 15 - 19 2.40% 5.25%

20 & Over 2.40% 4.40%2.00%

5.35% 4.00% 2.85%

% Increase in Salary - Firefighters Merit and Seniority Inflation

Total Increase

Under 5 2.40% 9.00%

5 - 9 2.40% 6.25% 10 - 14 2.40% 5.00%

15 & Over 2.40% 3.75%1.35%

6.60% 3.85% 2.60%

% Increase in Salary - Police Officers Merit and Seniority Inflation

Total

Under 2 2.40% 8.00%

2 - 9 2.40% 6.00% 10 - 14 2.40% 5.75% 15 - 19 2.40% 5.00%

20 and Higher 2.40% 3.50%1.10%

3.60% 3.35% 2.60%

% Increase in Salary - Non-Hazardous Duty Merit and Seniority Inflation

Total

5.60%

City of Clearwater Employees’ Pension Plan B-20

Demographic Assumptions

The mortality tables used in the valuation for Hazardous Duty members are based on the PUB-2010 Benefits Weighted Mortality Tables described below, with mortality improvements projected generationally for all lives to all future years after 2010 using Scale MP-2021.

Pre-Retirement PUB-2010 Table Post-Retirement PUB-2010 Table Female Healthy Benefits Weighted Safety Employee

Female Table Benefits Weighted Safety Healthy Retiree Female Table

Male Healthy Benefits Weighted Safety Employee

Male Table, set forward 1 year Benefits Weighted Safety Healthy Retiree Male Table, set forward 1 year

Female Disabled N/A Headcount Weighted General Disabled Retiree Female Table, set forward 1 year

Male Disabled N/A Headcount Weighted General Disabled Retiree Male Table

These are the same rates used for Special Risk Class members of the Florida Retirement System (FRS) in the July 1, 2025 FRS Actuarial Valuation Report. Florida Statutes Chapter 112.63(1)(f) mandates the use of the same mortality tables used by the FRS in either of its two most recently published actuarial valuation reports.

The following table presents post-retirement mortality rates and life expectancies at illustrative ages. These assumptions are used to measure the probabilities of each benefit payment being made after retirement.

City of Clearwater Employees’ Pension Plan B-21

FRS Healthy Post-Retirement Mortality for Special Risk Class…