2009 ANNUAL REPORT T REASURY D EPARTMENT D ENVER B OARD OF W ATER C OMMISSIONERS 1600 W. Denver12TH A VENUE Board, of D WaterENVER, CO 80204- 3412 P HONE: 303-628-6410 Commissioners Employees’ Retirement Program Employees’ Retirement Plan Denver Water 401(k) Supplemental Retirement Savings Plan Denver Water 457 Deferred Compensation Plan Ended December 31, 2009 Trust Funds of the Denver Board of Water Commissioners For Fiscal Year T REASURY D EPARTMENT, D ENVER B OARD OF W ATER C OMMISSIONERS 1600 W. 12TH A VENUE, D ENVER, CO 80204-3412, P HONE: 303-628-6410 2009 Annual Report of the Denver Board of Water Commissioners Employees’ Retirement Program TTAABBLLEE OOFF CCOONNTTEENNTTSS I. Introductory Section (unaudited) ........................................................................................... I-7 A. Letter of Transmittal ...................................................................................................... I-9 B. Organizational Chart of the Employees’ Retirement Program .................................... I-16 C. Denver Board of Water Commissioners ...................................................................... I-17 D. Key Members of the Retirement Program Committee ................................................ I-19 E. Consultants and Advisors ............................................................................................ I-21 II. Financial Section ................................................................................................................ II-23 A. Employees’ Retirement Plan ...................................................................................... II-25 1. Independent Auditor’s Report ................................................................................. II-25 2. Management’s Discussion and Analysis ................................................................ II-26 3. Basic Financial Statements .................................................................................... II-31 a) Statements of Plan Net Assets ............................................................................... II-31 b) Statements of Changes in Plan Net Assets............................................................ II-32 4. Notes to the Financial Statements .......................................................................... II-33 5. Required Supplemental Information ....................................................................... II-43 a) Schedule of Funding Progress ............................................................................... II-43 b) Schedule of Employer Contributions ...................................................................... II-43 6. Supporting Schedules (unaudited) ......................................................................... II-44 a) Schedule of Administrative Expenses .................................................................... II-44 b) Schedule of Investment Expenses ......................................................................... II-45 B. Denver Water Supplemental Retirement Savings Plan ............................................. II-46 1. Independent Auditor’s Report ................................................................................. II-46 2. Management’s Discussion and Analysis ................................................................ II-47 3. Basic Financial Statements .................................................................................... II-51 a) Statements of Net Assets Available for Benefits .................................................... II-51 b) Statements of Changes in Net Assets Available for Benefits ................................. II-52 4. Notes to the Financial Statements .......................................................................... II-53 C. Denver Water 457 Deferred Compensation Plan ....................................................... II-57 1. Independent Auditor’s Report ................................................................................. II-57 2. Management’s Discussion and Analysis ................................................................ II-58 3. Basic Financial Statements .................................................................................... II-62 a) Statements of Net Assets Available for Benefits .................................................... II-62 TABLE OF CONTENTS TABLE OF CONTENTS I-3 2009 Annual Report of the Denver Board of Water Commissioners Employees’ Retirement Program b) Statements of Changes in Net Assets Available for Benefits ................................. II-63 4. Notes to the Financial Statements .......................................................................... II-64 III. Investment Section (unaudited) ......................................................................................... III-69 A. Employees’ Retirement Plan ..................................................................................... III-70 1. Report on Investment Activity ................................................................................ III-70 2. Outline of Investment Policies ............................................................................... III-72 3. Schedule of Investment Managers ........................................................................ III-74 4. Schedule of Investment Results ............................................................................ III-76 5. Asset Allocation ..................................................................................................... III-79 6. Investment Summary ............................................................................................. III-81 7. List of Largest Holdings by Asset Type ................................................................. III-82 8. Schedule of Fees and Commissions ..................................................................... III-84 B. Denver Water 401(k) Supplemental Retirement Savings Plan/ Denver Water 457 Deferred Compensation Plan .................................................................................... III-90 1. Report on Investment Activity ................................................................................ III-90 2. Outline of Investment Policies ............................................................................... III-93 3. Schedule of Investment Managers ........................................................................ III-95 4. Schedule of Investment Results ............................................................................ III-96 5. Asset Allocation ..................................................................................................... III-98 6. Schedule of Fees and Commissions ................................................................... III-100 IV. Actuarial Section (unaudited) .......................................................................................... IV-103 A. Actuary’s Certification Letter ................................................................................... IV-105 B. Summary of Actuarial Methods and Assumptions .................................................. IV-106 C. Changes in Actuarial Methods and Assumptions Since Prior Year ........................ IV-111 D. Schedule of Active Member Valuation Data ............................................................ IV-112 E. Schedule of Retirees and Beneficiaries Added and Removed from Rolls .............. IV-113 F. Solvency Test .......................................................................................................... IV-114 G. Analysis of Financial Experience ............................................................................. IV-115 TABLE OF CONTENTS CONTENTS TABLE OF H. Summary of Plan Provisions ................................................................................... IV-119 I. Changes in Plan Provisions .................................................................................... IV-122 J. Schedule of Funding Progress ................................................................................ IV-123 K. Schedule of Employer Contributions ....................................................................... IV-124 L. Notes to Trend Data ................................................................................................ IV-125 V. Statistical Section (unaudited) .......................................................................................... V-127 A. Employees’ Retirement Plan .................................................................................... V-130 1. Schedule of Additions by Source, 2000-2009 ...................................................... V-130 I-4 2009 Annual Report of the Denver Board of Water Commissioners Employees’ Retirement Program 2. Schedule of Deductions by Type, 2000-2009 ...................................................... V-131 3. Schedule of Benefit Deductions from Net Assets by Type, 2000-2009 ............... V-132 4. Schedule of Changes in Net Assets, 2000-2009 .................................................. V-132 5. Schedule of Retired Members by Type of Benefit ................................................ V-133 6. Schedule of Average Benefit Payment Amounts for Retirees, 2000-2009 .......... V-134 7. Other Information .................................................................................................. V-135 B. Denver Water 401(k) Supplemental Retirement Savings Plan ...............................