ACFR - FY2021 FINAL 5-13-22 USE THIS ONE - Flipbook - Page 98
NOTES TO FINANCIAL STATEMENTS
CITY OF EUSTIS, FLORIDA
(Continued)
Note 5 - Pension Funds (Continued)
Police and Fire Defined Benefit Pension Plans
Both the Police Officer and Firefighters’ Pension Plans did not hold investments in any
organization representing 5% or more of the Plan’s fiduciary net position.
For the year ended September 30, 2021, the money-weighted rate of return was 7.00%
and 1 7.69% for the Police Officers’ and Firefighters’ plans respectively; t h i s
expresses investment performance, net of investment expense, adjusted for the
changing amounts invested.
Long Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined
using a building-block method. The best estimate ranges of expected future real rates of
return (expected returns, net pension plan investment expenses, and inflation) are
developed for each major asset class. These ranges are combined to produce
the long-term expected rate of return by weighting the expected future real rates of
return by the target asset allocation percentage and by adding expected inflation.
Best estimates of real arithmetic rates of return for each major asset class are
included in both the police officers’ and firefighters’ pension plan’s target asset
allocation as of September 30, 2021.
Target
Allocation
Target
Allocation
Police
Asset Class
Domestic Equity
International Equity
Domestic Fixed Income
Real Estate
GTAA
Long Term
Expected
Rate of
Return
54.30%
9.80%
32.90%
0%
0%
Fire
7.00%
7.00%
7.00%
0%
0%
45.00%
15.00%
25.00%
10.00%
5.00%
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Long Term
Expected
Rate of
Return
7.50%
8.50%
2.50%
4.50%
3.50%