UTAH LOCAL GOVERNMENTS TRUST

2018 ANNUAL REPORT The Trust is Partner of Choice for 71% In 2018 our Board of Directors authorized $2,000,000 in premium relief credits and further rate reductions. The Trust of ’s Local Governments, now protects more than $5,000,000,000 in member assets with 99.8% Member Retention and hundreds of millions in liability risks. In 2018 we paid $21,692,079 in claims and expenses. We strengthened our net position by $4,492,590. This added security protects members from the storms of today and tomorrow.

CEO’s MESSAGE Since 1974, the Trust has provided specialized insurance products and services to Utah’s local governments. Today, the Trust has The year 2018 was yet another insuring relationships with 538 members: 92% of Utah’s Cities record-breaking year for the Utah and Towns; 66% of Utah’s Special Districts, and 34% of Utah’s Local Governments Trust. Counties. We compete directly with the commercial market and After pouring over options, 31 new other insurance providers. We deliver what others cannot. We are members joined our pooled programs. Best in Class. Dozens of members bid out their Our philosophy is simple. We listen, we respond, and we deliver insurance – not surprisingly, 99.8% measurable results. Our team and our members are first rate. renewed their partnership with We will continue to lead with innovation, accountability, and the Trust. We continue to expand discipline – course correcting along the way. coverage and cut rates. Our size and scale, people and partnerships, Thank you for your confidence in the Trust. It’s our privilege to and management philosophy make serve you. this possible.

Steven A. Hansen CEO, Utah Local Governments Trust

PAGEpage 3 5 page Appointed JoAnn B. Seghini Robinson Christopher F. Council Member, Summit County Pamela A. Roberts Appointed Executive Director, Waste & Recycling District Bradley M. Powell General Manager, Midvalley Improvement District transparency, and credit. and transparency, Joe L. Piccolo Appointed Kenneth F. Neilson Mayor, Washington City Leaders establish trust with candor, with trust establish Leaders Shawn B. Milne Commissioner, Tooele County — Jack Welch, Former CEO of General Electric Electric General of CEO Former — Jack Welch, Mayor, Midvale City Robert M. Hale Executive Committee Mayor, Hyrum City Stephanie L. Miller Craig W. Buttars Executive Committee Executive, Cache County Executive Committee General Manager, Transit District Todd S. Beutler Board Chair Executive Committee Manager, Davis County Mosquito Abatement District Gary L. Hatch

TRUST BOARD OF DIRECTORS ASSETS 2018 2017

current assets: Cash $ 273,616 $ 78,129 Investment in State of Utah Public Treasurers’ Investment Fund 16,132,317 36,819,599 Receivables: Premiums 887,372 434,491 Investment income 439,931 283,144 Administrative fees 115,247 69,316 Today, the Trust has insuring relationships with 538 members: Reinsurance recoverable on paid claims 5,920,107 4,572,729 Other 19,128 83,516 % % Prepaid expenses 1,003,562 903,352

FINANCIALS 92 of Utah’s Cities and Towns, 66 of Utah’s Local and TOTAL CURRENT ASSETS $ 24,791,280 $ 43,244,276 Special Service Districts, and 34% of Utah’s Counties. non-current assets: Strong financial performance is the by-product of member focus Investment in debt securities 78,173,912 49,667,269 Restricted investment in debt securities held by State Treasurer 5,970,724 5,985,283 and teamwork. If results are better than actuarial projections, Capital assets 6,322,813 6,482,816 Deposit with Constitution State Services LLC 112,552 112,552 Deposit with NLC Mutual Insurance Company 525,295 525,295 members reap the reward through dividends, premium subsidies,

more coverage for less premium, and increased financial security. TOTAL NON-CURRENT ASSETS $ 91,105,296 $ 62,773,215

TOTAL ASSETS $ 115,896,576 $ 106,017,491

DEFERRED OUTFLOWS OF R ESOURCES 2018 2017

RELATED TO PENSIONS $ 520,636 $ 633,480

page 7 LIABILITIES 2018 2017 REVENUES & EXPENSES 2018 2017

current liabilities: operating revenues: Current portion of estimated unpaid claims and claims adjustment expenses $ 16,786,112 $ 15,157,221 Gross premiums earned $ 30,230,658 $ 28,714,606 Trust premium relief credit liability 1,954,352 977,565 Trust premium relief credit (1,954,352) (999,809) Unearned premiums 7,904,236 7,764,957 Reinsurance premiums (4,879,601) (3,884,980) Accounts payable and accrued expenses 906,165 833,525 State premium tax payable 215,379 490,547 NET PREMIUMS EARNED $ 23,396,705 $ 23,829,817

Administrative fees 687,066 682,088 TOTAL CURRENT LIABILITIES $ 27,766,244 $ 25,223,815 Other revenue 14,978 15,151

non-current liabilities: TOTAL OPERATING REVENUES $ 24,098,749 $ 24,527,056 FINANCIALS Net pension liability 617,976 912,953 Total OPEB obligation 431,586 401,361 operating expenses: Estimated unpaid claims and claims adjustment expenses, 23,529,043 20,678,909 Claims and claims adjustment expenses 16,297,469 14,375,723 net of current portion State premium tax expense 603,413 634,076 General and administrative expenses 4,791,197 4,635,834 TOTAL NON-CURRENT LIABILITIES $ 24,578,605 $ 21,993,223

TOTAL OPERATING EXPENSES $ 21,692,079 $ 19,645,633 TOTAL LIABILITIES $ 52,344,849 $ 47,217,038

OPERATING INCOME $ 2,406,670 $ 4,881,423

DEFERRED INFLOWS OF R ESOURCES 2018 2017 nonoperating revenues (expenses): Investment income 2,704,084 1,891,949 Change in fair value of investments (618,164) (76,374) RELATED TO PENSIONS $ 306,297 $ 160,457

TOTAL NONOPERATING REVENUES (EXPENSES) $ 2,085,920 $ 1,815,575

CHANGE IN NET POSITION $ 4,492,590 $ 6,696,998 NET P OSITION 2018 2017 NET POSITION AT BEGINNING OF YEAR $ 59,273,476 $ 52,576,478

Invested in capital assets 6,322,813 6,482,816 NET POSITION AT END OF YEAR $ 63,766,066 $ 59,273,476 Unrestricted 57,443,253 52,790,660 We honor our fiduciary responsibility - financial strength guarantees our ability TOTAL NET POSITION $ 63,766,066 $ 59,273,476 to deliver on our promises in times of need. The financial statements shown are derived from the Trust’s audited financial statements for 2018 and do not include notes. A copy of the complete audited financial statements can be obtained from the Trust upon request. page 9 1 1 page Tooele County, Clerk/Auditor Tooele County, County Commissioner Tooele County, County Commissioner Tooele County, Tremonton, City Manager Uintah Recreation District, Executive Director Districts, Utah Association of Special Executive Director Chief Utah County, Civil Division Towns, Utah League of Cities and Executive Director Vernal, City Manager Wasatch Front Waste & Recycling District, Executive Director Wasatch Integrated Waste Management District, Executive Director Wasatch Mental Health Services SSD, Executive Director Washington, City Manager Washington Terrace, City Manager West Point, City Manager Woods Cross, City Administrator Roger Carter Tom Hanson Kyle Laws Gary Uresk Marilyn Gillette Shawn Milne Kendall Thomas Shawn Warnke Robin O’Driscoll LeGrand Bitter Dave Shawcroft Cameron Diehl Quinn Bennion Pam Roberts Nathan Rich Juergen Korbanka — Jim Casey, Founder of UPS UPS of Founder — Jim Casey, together can do anything. can together Determined people working working people Determined Riverton, City Attorney Riverton, City Manager Roosevelt, City Improvement District, Sandy Suburban General Manager Santa Clara, City Manager Santaquin, City Manager Saratoga Springs, City Manager Smithfield, City Manager Reclamation Snyderville Basin Water District, General Manager South Ogden, City Manager South Valley Sewer District, General Manager South Valley Water Reclamation Facility, General Manager Springville, City Administrator St. George, City Attorney Summit County, County Manager Taylorsville, City Administrator Tooele, City Attorney Tooele, Mayor Tooele County, County Attorney Scott Broadhead Ryan Carter Ryan Snow Jerry Knight Ed Dickie Ben Reeves Mark Christensen Craig Giles Mike Luers Matt Dixon Craig White Lee Rawlings Troy Fitzgerald Shawn Guzman Tom Fisher John Taylor Roger Baker Debbie Winn Ivins, City Manager/Attorney Manager Kaysville, City Kaysville, Mayor Kearns Improvement District, General Manager Lehi, City Administrator Lindon, City Administrator Logan, City Attorney Manti, City Administrator Midvale, City Manager District, Midvalley Improvement General Manager Moab, City Manager Morgan, City Manager Nephi, City Administrator Nibley, City Manager North Logan, City Manager North Pointe Solid Waste SSD, District Manager North Salt Lake, City Manager Panguitch, City Manager Parowan, City Manager Payson, City Manager Pleasant Grove, City Administrator Pleasant View, City Administrator Price River Water Improvement District, District Manager Provo City Housing Authority, Executive Director Richfield, City Administrator Scott Darrington Bill Cobabe Jeff Richens Robert Vernon Matt Creamer Dale Coulam Shayne Scott Katie Witt Pam Gill Jason Walker Adam Cowie Kymber Housley Kent Barton Kane Loader Brad Powell David Everitt Ty Bailey Seth Atkinson David Zook Alan Luce Rodger Harper Ken Leetham Lori Talbot Cleve Matheson Dave Tuckett Alta, Town Administrator Water & Sewer Improvement Ashley Valley Manager District, District Bear River Health Department, Deputy Director Bluffdale, City Manager Brian Head, Town Manager Cache County, HR Director Cache Valley Transit District, General Manager Carbon County, Clerk/Auditor Clinton, City Manager Cottonwood Heights, City Manager Cottonwood Heights Parks and Recreation Service Area, Director Eagle Mountain, City Administrator Enoch, City Manager Enterprise, City Administrator Ephraim, City Manager Fruit Heights, City Manager Grantsville, Mayor Heber, City Manager Highland, City Administrator Housing Authority of , Operations Director Housing Authority of the County of Salt Lake, Director of Finance Housing Authority of Utah County, Executive Director Hurricane, City Manager Hyrum, City Administrator John Guldner Dave Hatch Todd Barson Mark Reid Bret Howser Amy Adams Todd Beutler Seth Marsing Dennis Cluff Tim Tingey Ben Hill Ifo Pili Rob Dotson Adam Bowler Brant Hanson Brandon Green Brent Marshall Dennis Gunn Nathan Crane Kim Wilford Andre Bartlome Lynell Smith Clark Fawcett Ron Salvesen

TRUST ADVISORY COMMITTEE 3 1 page hittier W Chris Rozelle Claims Manager James Data Analyst -Underwriter Jody Pettet Accounting Manager Jason Watterson Loss Prevention Consultant A. Craig Hale Megan Van Gundy Accounting Technician, Payables Darin Palmer Membership Development Account Executive Accurate accounting and financial reporting is the reporting is accounting and financial Accurate clean auditors have reported of the Trust. Trust backbone audit opinions for more than or unmodified financial GASB and GAAP standards to two decades. We follow fidelity. ensure accuracy and Accounting Curtis Tonks Membership Development Account Executive Taylor Ottenbacher Underwriting Manager General Counsel, Utah Local Governments Trust Ethan Stuart Data Analyst -Underwriter Brent Oakeson Loss Prevention Consultant professional team is focused on making sure members are covered when it matters most. covered members are team is focused on making sure professional understands the unique risks faced by its members and how to help minimize them. Just as its members and how to help minimize them. Just understands the unique risks faced by importantly, the Trust knows how to help when those risks rear their ugly heads. The Trust’s The Trust’s their ugly heads. knows how to help when those risks rear the Trust importantly, Brody Shiba Technical Services Specialist Josh McKell Membership Development Account Executive Unfortunately, risk is an inevitable part of running an effective governmental entity. The Trust The Trust risk is an inevitable an effective governmental entity. part of running Unfortunately, Nationally, 85% of governments buy insurance through buy insurance 85% of governments Nationally, security, financial Here’s why: coverage, risk pools. and claims. We simplify insurance risk management, In Utah, 71% of local so you can evaluate options. to partner with the Trust. governments chose Sales & Marketing Sales & Steven A. Hansen Chief Executive Officer Brady Loveland Technical Services Manager Jill Johnson Technical Services Member Advocate Doug Folsom Loss Prevention Manager When things go bad, we step in. We pay covered claims and When things go bad, we step in. We pay defend our members when they need it most. We value your input and experience in helping to resolve claims. We use mathematical models and data analytics to and data analytics models We use mathematical It’s and sustainable way. cost of risk in a fair spread the quality partners and risks, the law-of-large-numbers, that allow us to deliver the and careful underwriting of risk. lowest long-term cost Claims Underwriting Chelsea Johnson Executive Assistant Katrina Flavell Accounting Technician, Receivables Kim Blackburn Member Services Ambassador Membership Development Manager Ryan Hatch Mark Haslam Software Engineer Greg Baumgartner Membership Development Account Executive Technical Services the and injury through reduce loss We help members (TAP). We are Utah’s Program Trust Accountability risk pool because safety matters. preferred governmental people and financial resources. Together, we protect We help you leverage the power of myTRUST - our new We help you leverage the power of myTRUST member portal. This innovative tool gives you control over policies, applications, invoicing, property schedules, and more. Loss Prevention

TRUST TEAM 227 Cities & Towns F Hinckley Lehi N River Heights T Fairfield Holden Levan Naples Riverdale Tabiona Fairview Holladay Lewiston Nephi Riverton Taylorsville Clarkston A Farmington Honeyville Lindon New Harmony Rockville Tooele Clawson Alpine Farr West Hooper Logan Newton Rocky Ridge Toquerville Cleveland Alta Fayette Howell Lyman Nibley Roosevelt Torrey Clinton Altamont Ferron Huntington Lynndyl North Logan Roy Tremonton Coalville Alton Fielding Huntsville North Salt Lake Rush Valley Trenton Copperton Metro M Amalga Fillmore Hurricane Township Tropic Magna Metro O S Annabella Fountain Green Hyde Park Corinne Township Antimony Hyrum Oak Salem U Francis Manila Cornish Salina Apple Valley Fruit Heights Oakley Uintah Cottonwood Heights Manti Aurora I Orangeville Sandy Mantua V G Independence Santa Clara D Orderville MEMBERS Mapleton B Garden Interlaken Santaquin Vernal Daniel Marriott-Slaterville P Ballard Garland Ivins Saratoga Springs Vernon Delta Marysvale Bear River Genola Panguitch Scipio Vineyard Deweyville J Mayfield Bicknell Glendale Paradise Scofield Virgin Duchesne Joseph Mendon Blanding Glenwood Paragonah Sigurd Dutch John Junction Midvale W Bluff Goshen Parowan Smithfield Midway Wales Bluffdale Payson Snowville E Grantsville K Milford Perry Washington Brian Head Eagle Mountain Green River South Ogden Kamas Millcreek Washington Terrace Bryce Canyon Plain South Weber East Carbon Gunnison Kanab Millville Pleasant Grove Wellington Elk Ridge Spanish Fork C Kanarraville Minersville Wellsville H Pleasant View Spring Elmo Kanosh Cannonville Hanksville Moab Plymouth Wendover Elsinore Springdale Castle Dale Kaysville Mona West Bountiful Harrisville Portage Springville Elwood Kearns Metro Township Castle Valley Hatch Monroe Price West Haven Emery St. George Cedar Fort Kingston Monticello West Point Heber Providence Sterling Emigration Canyon Koosharem Cedar Highlands Metro Township Helper Morgan White City Stockton Metro Township Centerfield Moroni R Enoch Henefer L Sunset Randolph Willard Centerville Enterprise Henrieville Mt. Pleasant Laketown Syracuse Woodland Hills Central Valley Myton Redmond Ephraim Herriman LaVerkin Richfield Woodruff Charleston Escalante Hideout Leamington Woods Cross Circleville Richmond Eureka Highland Leeds

page 15 D Flaming Gorge I 10 Counties 301 Local and Special Service Districts Road/Transportation Daggett County Mosquito Indian Ridge Water Conservancy Four Corners Behavioral Health Dammeron Valley Fire Intermountain Power Building Authority Kane County Freedom Academy C A Davis/Weber County Water Conservancy Cache Angell Springs SSD Canal Company Fruitland SSD J

Carbon Ash Creek SSD C Davis Community Jensen Water Improvement Housing Authority G Johnson Water Improvement Ashley Valley Sewer Cache County EMS Authority Davis Conservation Garden City Cemetery E Jordan River Commission Ashley Valley Water/Sewer Cache Metro Planning Emery Davis Mosquito Abatement Garden City Fire Cache Mosquito B Davis-Salt Lake Aerial Spray Grand County Cemetery K G Cache Valley Transit Ballard Water Improvement Deseret-Oasis SSD Grand County Recreation Kane County Task Force Cache Water Grand Bear Lake SSD Diamond Valley Fire Grand County Transportation Kane County Water Conservancy Canyonlands Health Care Bear River AOG Deer SSD Grand Water/Sewer Kearns Improvement S Carbon County Recreation and Bear River Commission Duchesne Conservation Grantsville Conservation San Juan Transportation SSD

MEMBERS L Duchesne County Greater Salt Lake City Municipal Bear River Health Carbon County Recreation Summit Water Conservancy La Sal Recreation Bear River Mental Health Transportation Local Green Hills Water/Sewer Building Authority Grouse Creek Solid Waste Lake Point Cemetery/Parks T Bear River Water Conservancy E Carbon Water Conservancy Grouse Creek SSD Lake Point Improvement Tooele Beaver City Housing Authority East Duchesne Culinary Castle Dale Building Commission Little Mountain Service Area Ben Lomond Cemetery Water Improvement Gunlock SSD U Castle Valley SSD Gunnison Valley Police Local Building Authority Benchland Water East Zion SSD of Bluffdale Utah Cedar City Housing Authority Gunnison Valley Recreation Benson Culinary Eastland SSD Lone Peak Public Safety Water Improvement Cedarview-Montwell SSD Eden Park Service Long Valley Sewer Improvement W Central Box Elder Fire H Big Cottonwood Elk Meadows SSD Wasatch Canyon Improvement Central Davis Sewer Hanna Water/Sewer Emery County Care and M Wayne Big Plains Water/Sewer Central Iron County Rehabilitation Center Heber Valley SSD Maeser Water Improvement Water Conservancy Blanding Cemetery Emery County Fire Hooper Water Improvement Magna Mosquito Central Utah 911 Bluff Service Area Emery County Recreation Housing Authority of Manti Ambulance Central Utah Counseling Carbon County Bluff Water Works Emery County SSD #1 Metro Fire Agency Central Utah Public Health Housing Authority of Bona Vista Water Improvement Emery Water Conservancy Salt Lake City Mexican Hat SSD Church Wells SSD Box Elder County/ Emigration Improvement Housing Authority of Midvalley Improvement Perry City Flood College-Young Mosquito Enterprise Valley Medical Southeastern Utah Midway Sanitation Box Elder County/ Corinne Drainage District #1 Ephraim Ambulance Housing Authority of Utah County Willard City Flood Military Installation Development Cottonwood Heights Housing Connect Box Elder County SSD #1 Parks/Recreation Millard Conservation F Hurricane Redevelopment Agency Box Elder Mosquito Cottonwood Improvement Moab Mosquito Fielding Cemetery Hyde Park Cemetery Bridgerland Community Ice Arena Council on Aging-Golden Age Moab Valley Fire Five County AOG Crescent Cemetery page 17 Morgan City Ogden-Weber Tech College San Juan County Transportation Summit County Service Area #3 Uintah Transportation Waste Management Service District #5 Redevelopment Agency Oquirrh Recreation/Parks San Juan County Summit Mosquito Uintah Water Conservancy Morgan Conservation Water Conservancy Utah Local Governments Wayne Community Health Mountain Green Fire P San Juan Mental Health- T Trust Board Weber Basin Water Conservancy Substance Abuse Mountain Green Sewer Park City Fire Tabby Valley Parks/Recreation Unified Fire Weber Conservation San Rafael Conservation Mountain Meadow SSD Paunsaugunt Cliffs SSD Taylor West Weber Upper Country Water Improvement Weber Housing Authority Sandy Suburban Improvement Mountain Regional Water Peoa Recreation Water Improvement Utah Association of Weber Mosquito Sanpete County Fire Conservation Districts Mountainland AOG Perry-Willard Wastewater Teasdale SSD Weber/Morgan Narcotics Scofield Reservoir SSD Utah Association of Strike Force Mt Olympus Improvement Treatment Plant Thatcher-Penrose Fire Special Districts Sevier County SSD #1 West Corinne Water Municipal Building Authority Pine Meadow Mutual Water Thompson SSD Utah Chiefs of Police of Vernal Pine Valley Local Administrative Six County AOG Thompson Springs Fire West Erda Improvement Utah Communications Mutton Hollow Improvement Pine Valley SSD Skyline Mountain SSD Ticaboo Utility Improvement West Haven SSD Utah Inland Port Authority Myton City Housing Authority Pinon Forest SSD Snyderville Basin Timber Lakes Water West Millard Mosquito Special Recreation Utah League of Cities/Towns Pioneer SSD Timberline SSD West Warren Community Park N Snyderville Basin Utah Local Governments Trust MEMBERS Pleasant Grove Tooele County Housing Authority Western Kane County SSD #1 Water Reclamation Metropolitan Water Utah Municipal Power Neola Community Park Tooele Valley Mosquito Western States Water Solid Waste SSD #1 Water/Sewer UTOPIA Neola Water/Sewer Trans-Jordan Cities Western Uintah Basin Mosquito South Davis Sewer Price River Water Improvement New Harmony Valley SSD Tremonton-Garland Drainage White City Water Improvement South Davis Water Improvement V Price River Watershed North Davis Fire Tridell-Lapoint Water White Hills SSD Conservation South Salt Lake Valley Mosquito Vernal City Development/ North Davis Sewer Improvement Wolf Creek Water / Sewer Provo City Housing Authority South Summit Cemetery Renewal Agency North Fork SSD Tropic Cemetery Women of Water Provo Metropolitan Water South Utah Valley Animal Vernon Water Works North Park Police Woodruff Cemetery South Utah Valley Electric U North Point Solid Waste W R Woodruff Fire South Valley Sewer Uintah Animal Control/Shelter North Sanpete Ambulance Wanship Cemetery Woods Cross City Redevelopment Randolph Fire South Valley Water Reclamation Uintah Basin Assistance Council North Sevier Recreation Warren/West Warren Richmond Cemetery South Weber Water Improvement North Summit Fire Uintah Basin AOG Water Improvement Riverside Cemetery Southeastern Utah Association of North Summit Recreation Uintah Basin Narcotics Wasatch County Conservation Riverside Community SSD Local Governments Strike Force North Tooele SSD Wasatch County Fire Roosevelt City Housing Authority Southern Utah Valley Power Uintah Care Center North Utah Valley Animal Wasatch Front Regional Council Roy Water Conservancy Southwest Mosquito Uintah County/Vernal Interlocal North View Fire Wasatch Front Waste Rural Water Association of Utah Southwestern SSD Uintah Fire and Recycling

O St. George Area Economic Uintah Health Care Wasatch Integrated Waste S Development Uintah Highlands Improvement Ogden Housing Authority Wasatch Mental Health St. George Housing Authority Salt Lake City Mosquito Uintah Impact Mitigation Ogden Preparatory Academy Washington County Flood Control Stansbury Park Improvement Salt Lake Conservation Uintah Mosquito Ogden Valley Parks Service Area Washington County Solid Waste Stansbury Service Agency Salt Lake County Service Area #3 Uintah Recreation Ogden Valley Washington County Sugar House Park Authority Recreation/Transmission Salt Lake Urban Search/Rescue Water Conservancy page 19 Great things in business are never done by one person. They’re done by a team of people. Steve Jobs

55 South Highway 89 North Salt Lake, UT 84054 tel: 801.936.6400 toll: 800.748.4440

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