Fort Walton Beach — Annual Comprehensive Financial Report, September 30, 2025 — reading text

1,024,247 $ 1,419,339 $ 1,602,192 $ 1,771,147 $ 1,120,584 $ 1,197,424 Contributions in relation to the actuarially determined contributions 228,642 284,704 314,371 580,847 1,024,247 1,419,339 1,751,654 2,006,925 1,254,097 1,280,082 Contribution deficiency (excess) $ - $ (42,141) $ (24,916) $ - $ - $ - $ (149,462) $ (235,778) $ (133,513) $ (82,658) Covered payroll $ 1,449,235 $ 2,001,875 $ 2,140,710 $ 2,571,886 $ 2,723,263 $ 2,957,684 $ 3,000,359 $ 3,162,762 $ 3,437,375 $ 4,045,350 Contributions as a percentage of covered payroll 15.78% 14.22% 14.69% 22.58% 37.61% 47.99% 58.38% 63.45% 36.48% 32.33% Police Officers' Retirement Fund Actuarially determined contribution $ 1,711,524 $ 1,578,349 $ 1,643,297 $ 1,429,945 $ 1,456,033 $ 1,024,419 $ 837,623 $ 928,289 $ 650,347 $ 709,037 Contributions in relation to the actuarially determined contributions 1,809,215 2,049,220 1,694,073 1,550,980 1,456,033 1,024,419 913,763 1,033,081 750,791 790,573 Contribution deficiency (excess) $ (97,691) $ (470,871) $ (50,776) $ (121,035) $ - $ - $ (76,140) $ (104,792) $ (100,444) $ (81,536) Covered payroll $ 3,916,530 $ 3,740,162 $ 3,526,388 $ 3,035,976 $ 2,941,480 $ 2,640,254 $ 2,263,844 $ 2,242,245 $ 2,091,146 $ 2,073,208 Contributions as a percentage of covered payroll 46.19% 54.79% 48.04% 51.09% 49.50% 38.80% 40.36% 46.07% 35.90% 38.13% Firefighters' Retirement Fund Actuarially determined contribution $ 1,618,256 $ 1,604,756 $ 1,627,107 $ 1,546,144 $ 1,534,814 $ 1,293,057 $ 1,127,832 $ 1,138,295 $ 899,929 $ 816,138 Contributions in relation to the actuarially determined contributions 1,921,848 1,905,438 1,706,211 1,646,716 1,625,961 1,441,189 1,236,461 1,284,763 998,712 945,923 Contribution deficiency (excess) $ (303,592) $ (300,682) $ (79,104) $ (100,572) $ (91,147) $ (148,132) $ (108,629) $ (146,468) $ (98,783) $ (129,785) Covered payroll $ 2,926,322 $ 3,039,311 $ 3,123,046 $ 2,917,251 $ 2,826,544 $ 2,560,508 $ 2,364,429 $ 2,276,592 $ 2,168,503 $ 2,060,954 Contributions as a percentage of covered payroll 65.67% 62.69% 54.63% 56.45% 57.52% 56.29% 52.29% 56.43% 46.06% 45.90% See notes to the schedule of contributions. 88  CITY OF FORT WALTON BEACH, FLORIDA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF INVESTMENT RETURNS SEPTEMBER 30, 2025 Measurement Period Ended: 9/30/2024 9/30/2023 9/30/2022 9/30/2021 9/30/2020 9/30/2019 9/30/2018 9/30/2017 9/30/2016 9/30/2015 General Employees' Retirement Fund Annual Money-Weighted Rate of Return Net of Investment Expense 21.76% 8.68% -14.99% 21.35% 10.25% 3.78% 11.43% 12.45% 10.78% -0.01% Police Officers' Retirement Fund Annual Money-Weighted Rate of Return Net of Investment Expense 20.26% 10.85% -13.47% 19.34% 10.01% 5.08% 7.82% 10.52% 9.12% -2.69% Firefighters' Retirement Fund Annual Money-Weighted Rate of Return Net of Investment Expense 20.82% 10.50% -14.84% 19.75% 11.01% 3.33% 9.24% 9.88% 7.25% 0.12% 89  CITY OF FORT WALTON BEACH, FLORIDA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE SCHEDULE OF PENSION CONTRIBUTIONS (UNAUDITED) GENERAL EMPLOYEES’ RETIREMENT FUND Valuation Date: October 1, 2023 Notes: Actuarially determined contribution rates are calculated as of October 1, which is two years prior to the end of the fiscal year in which contributions are reported. Methods and Assumptions Used to Determine Contribution Rates: Funding method: Entry-Age Actuarial Cost Method Mortality rates: Projected generationally with Scale MP-2018 Healthy lives: Female: PubG.H-2010 for Employees Male: PubG.H-2010 (Below Median) for Employees, set back one year Disabled lives: Female: PubG.H-2010 for Disabled Retirees, set forward three years Male: PubG.H-2010 for Disabled Retirees, set forward three years Interest rate: 7.00% per year, compounded annually, net of investment related expenses Inflation: 2.50% Termination rates: Age-based rates. Sample rates as follows: Sample Ages Probability 25 7.724% 30 7.397% 35 6.858% 40 6.113% 45 5.163% 50 4.316% 55 4.371% 60 5.631% Disability rates: Age-based rates. Sample rates as follows: Sample Ages Probability 20 0.07% 30 0.11% 40 0.19% 50 0.51% 60 1.66% 90  CITY OF FORT WALTON BEACH, FLORIDA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE SCHEDULE OF PENSION CONTRIBUTIONS (UNAUDITED) – CONTINUED GENERAL EMPLOYEES’ RETIREMENT FUND Salary increases: Age-based increase table, as follows: Age Increase* Under 25 6.50% 25-34 5.50% 35-44 4.50% 45+ 3.50% *Increase shown is inclusive of a 3.00% wage inflationary assumption. Retirement age: 100% probability of retirement upon attaining age 62 and ten years of service, along with probabilities of retiring with a subsidized benefit prior to age 62 at the following rates: Age Probability 52 4.218% 53 4.249% 54 4.293% 55 4.371% 56 4.500% 57 4.688% 58 4.941% 59 5.258% 60 5.631% 61 6.053% Cost of living increase: 2.50% per year beginning at retirement Payroll growth: None (closed plan) for purposes of amortizing the Unfunded Actuarial Accrued Liability. Actuarial asset All assets are valued at fair value with an adjustment made to uniformly spread method: actuarial investment gains and losses (as measured by actual fair value investment return against expected fair value investment return) over a five-year period. 91  CITY OF FORT WALTON BEACH, FLORIDA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE SCHEDULE OF PENSION CONTRIBUTIONS (UNAUDITED) POLICE OFFICERS’ RETIREMENT FUND Valuation Date: October 1, 2023 Notes: Actuarially determined contribution rates are calculated as of October 1, which is two years prior to the end of the fiscal year in which contributions are reported. Methods and Assumptions Used to Determine Contribution Rates: Funding method: Entry-Age Normal Actuarial Cost Method Mortality rates: Projected generationally with Scale MP-2018 Healthy lives: Female: PubS.H-2010 (Below Median) for Employees, set forward one year Male: PubS.H-2010 (Below Median) for Employees, set forward one year Disabled lives: Female: 80% PubG.H-2010 for Disabled Retirees / 20% PubS.H-2010 for Disabled Retirees Male: 80% PubG.H-2010 for Disabled Retirees / 20% PubS.H-2010 for Disabled Retirees Interest rate: 7.00% per year, compounded annually, net of investment related expenses Retirement age: Member Age Retirement Probability 50-51 5.0% 52-54 25.0% 55-56 10.0% 57 33.3% 58-59 50.0% 60+ 100.0% In addition to the above table, 100% are assumed to retire upon completion of 25 years of service at the age of 60. Early retirement: Service Years Retirement Probability 25 50.0% 26+ 100.0% Cost-of-living increase: 2.50% per year beginning at retirement Payroll growth: None Actuarial asset All assets are valued at fair value with an adjustment made to uniformly spread method: actuarial investment gains and losses (as measured by actual fair value investment return against expected fair value investment return) over a five-year period. 92  CITY OF FORT WALTON BEACH, FLORIDA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE SCHEDULE OF PENSION CONTRIBUTIONS (UNAUDITED) – CONTINUED POLICE OFFICERS’ RETIREMENT FUND Marital assumption: