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Bob Rast <br /> July 14, 2022 <br /> Plan Administration <br /> Administration of the plan will continue until all benefits are paid. Retirees shouldn't notice any difference, <br /> but current active members will eventually receive a benefit from the Fund as well as TMRS. Employees <br /> hired after the effective date will only receive a retirement benefit from TMRS. <br /> Measurement Basis for the Plan Freeze <br /> ... Results based on discount rates of 6.75°/a and 7.25% are provided <br /> ... The mortality projection scale was updated from the MP-2018 to the ultimate rates from MP-2021 <br /> ... Active members are assumed to retire at age 55, or current age if older <br /> ... Except for the changes mentioned above, all other assumptions are the same as shown in the <br /> 12/31/2020 actuarial report. <br /> ... The cost method was changed from Entry Age Normal (EAN)to Unit Credit. The Unit Credit cost <br /> method measures the actuarial present value of the accrued benefit rather than allocating the <br /> ultimate projected cost(including expected future service) levelly over a member's career as the <br /> EAN method does, so it is more appropriate for frozen plans when no additional benefits will be <br /> earned. <br /> ... Census data was based on member data as of June 30, 2022 as provided by the Board. The new <br /> data had 51 active members, 11 deferred vested, and 40 retirees/beneficiaries. <br /> ... The changes to the plan provisions were described above.Any plan provision not mentioned <br /> herein is the same as described in the 2020 actuarial report. <br /> Except for the most senior active members, the active members' accumulated contributions exceed the <br /> actuarial present value of accrued benefits(PVAB). Over time, the PVAB will increase as the members <br /> approach retirement(less discounting), but the accumulated contributions will not grow in value. These <br /> estimates assumed the changes being made would not result in a mass exodus of the active member <br /> population. Since the TMRS benefits will provide higher benefits at a lower member contribution rate,this <br /> is a reasonable assumption. However, if all active members below age 50 were to immediately terminate <br /> and take a refund of contributions, then the PVAB/AAL would increase by$1.2 million. Over time, the <br /> PVAB based on the underlying assumptions will increase, and the$1.2 million difference will gradually <br /> decrease. <br /> Closing <br /> The information contained in this analysis is intended to assist the Board in its discussions with the City of <br /> Paris on this important topic. As noted at the beginning,this is not a comprehensive summary of <br /> everything the Board will need to consider, and we recommend continuing discussions with the Fund's <br /> attorney. If you have any questions about this analysis, I'm happy to meet with you at your earliest <br /> convenience. <br /> Best regards, <br /> � � <br /> �/C'�__�.��" -'"�l <br /> David A. Sawyer, FSA EA FCA MAAA <br /> Senior Consulting Actuary <br /> 3 <br />