Investment Oversight Committee

Investment Oversight Committee AGENDA Thursday, May 21, 2026, 10:00 a.m. Council Hearing Room, 990 Palm Street, San Luis Obispo The Investment Oversight Commission holds in-person meetings. Zoom participation will not be supported. Attendees of City Council or Advisory Body meetings are eligible to receive one hour of complimentary parking; restrictions apply, visit Parking for Public Meetings for more details. INSTRUCTIONS FOR PUBLIC COMMENT: Public Comment prior to the meeting (must be received 3 hours in advance of the meeting): Mail - Delivered by the U.S. Postal Service. Address letters to the City Clerk's Office at 990 Palm Street, San Luis Obispo, California, 93401. Email - Submit Public Comments via email to advisorybodies@slocity.org. In the body of your email, please include the date of the meeting and the item number (if applicable). Emails will not be read aloud during the meeting. Voicemail - Call (805) 781-7164 and leave a voicemail. Please state and spell your name, the agenda item number you are calling about, and leave your comment. Verbal comments must be limited to 3 minutes. Voicemails will not be played during the meeting. *All correspondence will be archived and distributed to members, however, submissions received after the deadline may not be processed until the following day. Public Comment during the meeting: Meetings are held in-person. To provide public comment during the meeting, you must be present at the meeting location. Electronic Visual Aid Presentation. To conform with the City's Network Access and Use Policy, Chapter 1.3.8 of the Council Policies & Procedures Manual, members of the public who desire to utilize electronic visual aids to supplement their oral presentation must provide display-ready material to the City Clerk by 12:00 p.m. on the day of the meeting. Contact the City Clerk's Office at cityclerk@slocity.org or (805) 781-7114.  Pages 1. CALL TO ORDER Chair Emily Jackson will call the Regular Meeting of the Investment Oversight Committee to order. 2. PUBLIC COMMENT FOR ITEMS NOT ON THE AGENDA The public is encouraged to submit comments on any subject within the jurisdiction of the Investment Oversight Committee that does not appear on this agenda. Although the Committee will not take action on items presented during the Public Comment Period, the Chair may direct staff to place an item on a future agenda for discussion. 3. CONSENT Matters appearing on the Consent Calendar are expected to be non- controversial and will be acted upon at one time. A member of the public may request the Revenue Enhancement Oversight Commission to pull an item for discussion. The public may comment on any and all items on the Consent Agenda within the three-minute time limit. 3.a CONSIDERATION OF MINUTES - FEBRUARY 19, 2026 INVESTMENT 5 OVERSIGHT COMMITTEE MINUTES Recommendation: To approve the Investment Oversight Committee Minutes of February 19, 2026. 4. BUSINESS ITEMS 4.a PRESENTATION OF THE QUARTERLY INVESTMENT REPORT ON 7 PORTFOLIO PERFORMANCE & ECONOMIC OUTLOOK Recommendation: Receive and confirm investment policy compliance. 5. COMMENT AND DISCUSSION 5.a STAFF UPDATES AND AGENDA FORECAST Chair Jackson will provide a brief agenda forecast and updates. 6. ADJOURNMENT The next Regular Meeting of the Investment Oversight Committee is scheduled for August 20, 2026 at 10:00 a.m. in the Council Hearing Room at City Hall, 990 Palm Street, San Luis Obispo. LISTENING ASSISTIVE DEVICES are available -- see the Clerk The City of San Luis Obispo wishes to make all of its public meetings accessible to the public. Upon request, this agenda will be made available in appropriate alternative formats to persons with disabilities. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should direct such request to the City Clerk’s Office at (805) 781-7114 at least 48 hours before the meeting, if possible. Telecommunications Device for the Deaf (805) 781-7410. Agenda related writings or documents provided to the Investment Oversight Committee are available for public inspection on the City’s website, under the Public Meeting Agendas web page: https://www.slocity.org/government/mayor- and-city-council/agendas-and-minutes. Meeting video recordings can be found on the City’s website: http://opengov.slocity.org/WebLink/Browse.aspx?id=61037&dbid=0&repo=CityCl erk Page 4 of 29  Investment Oversight Committee Minutes February 19, 2026, 10:00 a.m. Council Hearing Room, 990 Palm Street, San Luis Obispo Investment Oversight Member Debbie Malicoat, City Manager Whitney McDonald, Committee Members Member Anni Wang, Chair Emily Jackson, Riley Kuhn, Emily Present: Francis Investment Oversight Committee Members Absent: City Staff Present: Administrative Assistant Michelle Karpovich _____________________________________________________________________ 1. CALL TO ORDER A Regular Meeting of the San Luis Obispo Investment Oversight Committee was called to order on February 19, 2026 at 10:09 a.m. in the Council Hearing Room at City Hall, 990 Palm Street, San Luis Obispo, by Chair Jackson. 2. PUBLIC COMMENT FOR ITEMS NOT ON THE AGENDA Public Comment: --End of Public Comment-- 3. CONSENT 3.a CONSIDERATION OF MINUTES - NOVEMBER 20, 2025 INVESTMENT OVERSIGHT COMMITTEE MINUTES Motion By Emily Francis Second By Member Wang To approve the Investment Oversight Committee Minutes of November 20, 2025. 1 Page 5 of 29  Ayes (5): Member Malicoat, Member Wang, Chair Jackson, Riley Kuhn, and Emily Francis Abstained (1): City Manager Whitney McDonald CARRIED (5 to 0) 4. BUSINESS ITEMS 4.a PRESENTATION OF THE QUARTERLY INVESTMENT REPORT ON PORTFOLIO PERFORMANCE & ECONOMIC OUTLOOK Justin Resuello with PFM Asset Management LLC, provided an update via PowerPoint presentation and responded to Committee inquiries. Public Comment: --End of Public Comment-- Motion By Riley Kuhn Second By Emily Francis Receive and confirm investment policy compliance. Ayes (6): Member Malicoat, City Manager Whitney McDonald, Member Wang, Chair Jackson, Riley Kuhn, and Emily Francis CARRIED (6 to 0) 5. COMMENT AND DISCUSSION 5.a STAFF UPDATES AND AGENDA FORECAST 6. ADJOURNMENT The meeting was adjourned at 10:42 a.m. The next Regular Meeting of the Investment Oversight Committee is scheduled for May 21, 2026 at 10:00 a.m. in the Council Hearing Room at City Hall, 990 Palm Street, San Luis Obispo. _________________________ APPROVED BY INVESTMENT OVERSIGHT COMMITTEE: XX/XX/202X 2 Page 6 of 29 Quarterly Investment Report AS OF March 31, 2026 Page 7 of 29 This report presents the City’s investment portfolio for the quarter ending March 31, 2026. It has been prepared to comply with regulations contained in California Government Code Section 53646. The report includes all investments managed by the City on its own behalf as well as for other third-party agencies on a fiduciary basis such as the Whale Rock Commission. It also includes all City related investments held by trustees for bond debt service obligations. As required, the report provides information on the investment type, issuer, maturity date, cost, and current market value for each security. Page 8 of 29  U.S. Treasury Yield Curve 5.50% Market 5.00% 4.91% Considerations Geopolitics has overtaken U.S. macro 4.50% 4.32% fundamentals as the market’s primary focus Yield 4.13% 4.00% 3.94% • Conflict in Iran has increased near- 3.79% term inflation risks due to higher commodity prices 3. … March 31, 2026 • Unemployment rate remains stable 3.50% with net new job creation near zero December 31, 2025 • Consumer spending and business investment continue to support 3.00% 3mo 2yr 5yr 7yr 10yr 20yr 30 yr growth, though momentum is slowing Maturity The FOMC maintained its “dot plot” projection for one 25 basis point rate cut First Quarter 2026 Returns 1% in 2026. Fed Chair Jerome Powell also acknowledged the path forward is complicated by the Middle Eastern 0.63% conflict, making it more challenging for the Fed to balance its dual mandate of price stability and maximum employment. 0.35% U.S. Treasury yields increased over the 0.19% 0.14% quarter as investors repriced their Fed 0.08% policy outlook driven by geopolitical turmoil and renewed inflation concerns. 0% ABS Agency Corp BBB Yield increases were led higher by the 2- U.S. Treasury Corp A-AAA year maturity reflecting market repricing of Fed interest rate policy over the next several quarters. Source: Bloomberg Finance L.P., as of March 31, 2026. Page 9 of 29 Source: ICE BofA Indices. ABS indices are 0-5 year, based on weighted average life. As of March 31, 2026. What we are watching… Change in Real GDP Unemployment Rate Dec Projections 6% Dec Projections Mar Projections While future Fed policy remains uncertain 3% amid the ongoing conflict, we view the 5% 4.4% 2.4% 4.3% 4.2% 4.2% meaningful rise in 2.3% 2.1% 2.0% 4% U.S. Treasury yields as an opportunity. As a 2% result, for shorter duration strategies, we 3% prefer a modestly longer duration stance. For longer duration strategies, we believe 1% 2% the risk profile is less favorable relative to shorter strategies but will maintain a curve 1% steepening bias by modestly underweighting 0% 0% the long end of the curve. 2026 2027 2028 Longer 2026 2027 2028 Longer Run Run Labor market data remained steady with unemployment at 4.3% in March. Monthly PCE Inflation Federal Funds Rate payroll employment remained subdued and 4% Dec Projections Mar Projections Dec Projections Mar Projections averaged 68,000 new jobs per month over 4% 5% the quarter. Initial jobless claims held near 3% 2.7% historically low levels and continuing claims 3% 2.2% 4% 3.4% declined, reinforcing the persistence of a 2.0% 2.0% 3.1% 3.1% 3.1% 2% 3% “low-hire, low-fire” environment. 2% 2% Inflation remained stubborn during the first 1% quarter of 2026, with limited progress in core 1% 1% services and continued upward pressure 0% 0% from tariff passthroughs. Looking ahead, the 2026 2027 2028 Longer 2026 2027 2028 Longer inflation outlook has become increasingly Run Run dependent on the duration of the Middle East conflict and the extent to which sustained energy price increases feed into core goods and services. Source: Federal Reserve, latest economic projections as of March 2026. Page 10 of 29  Current Cash and Investment Summary The following is a summary of the City’s cash and investments based on market value, as of March 31, 2026, compared to the prior quarter. Investment Entity March 31, 2026 Percent of Total** December 31, 2025 City Held Cash & Investments $74,253,332.36 25.7% $54,580,092.62 JPMorgan Money Market Account $50,000,000.00 17.3% $50,000,000.00 LAIF Held Investments $50,789,057.88 17.6% $50,257,651.85 PFMAM Managed Investments* $114,222,982.43 39.5% $113,756,480.36 TOTAL** $289,265,372.67 100% $268,594,224.83 Page 11 of 29 *Figures shown exclude accrued interest. **Details may not add up to total due to rounding. Current Factors Cash and Investment • Some major City revenues are received on a periodic rather than a monthly basis. Property Tax Summary is received in December, January, April, and May of each year. Transient Occupancy Tax is received monthly but varies considerably due to seasonality. There are several factors • Payments for bonded indebtedness or large which result in changes in capital projects can reduce the portfolio cash and investment substantially in the quarter in which they occur. balances from month-to- month and quarter-to- • The City pays its CalPERS obligation in a lump quarter, dependent on the sum at the beginning of the fiscal year to achieve receipt of revenues or a interest savings. large disbursement. Page 12 of 29 Securities % of % Change Permitted by Security Type Market Value Portfolio vs. 12/31/25 Policy U.S. Treasury 64,471,836 56.11% -7.09% 100% Securities in the City’s portfolio are priced by Federal Agency 0 0.00% 0.00% 100% Refinitiv, an independent pricing service, at the end Municipal Obligations 0 0.00% -0.19% 30% of every month. In some Negotiable CDs 1,004,436 0.87% -0.01% 30% cases, the City may have investments with a current Corporate Notes 32,375,270 28.18% 6.31% 30% market value that is greater Asset-Backed or less than the recorded 16,277,241 14.17% 1.05% 15% Securities value. These changes in Securities Sub-Total 114,128,784 99.33% 0.08% market value are due to fluctuations in the Money Market Fund 94,199 0.08% -0.05% 20% marketplace, having no effect on yield, as the City Accrued Interest 678,562 0.59% -0.03% does not intend to sell Securities Total 114,901,544 100.00% 0.00% securities prior to maturity. Nevertheless, these market changes can impact the total value of the portfolio. Page 13 of 29 Total Return PFMAM Managed 3/31/2026 12/31/2025 Average Maturity Total return is calculated 2.71 2.56 (Years) based on interest and both Effective Duration1 2.15 2.07 realized and unrealized changes in market value; Average Market Yield 3.99% 3.76% this is expressed as a rate 1Effective duration is the approximate percentage change in price for each 1% change in interest rates. of return over a specified period of time based on cost and is backward- looking. • Focused on long-term Total Rate Since performance and 3 Months 1 Year 3 Years of Return Inception growth City of SLO 0.38% 4.20% 4.38% 2.02% • Affected by both yield 0-5 Treasury and market value 0.33% 3.91% 4.13% 1.82% Index fluctuations Variance +0.05% +0.29% +0.25% +0.20% • Reflects “true value” of the portfolio • Recommended approach by the Government Finance Officers Association Page 14 of 29  The investment objectives of the City of San Luis Obispo are first, to provide safety of principal to ensure the preservation of capital in the overall portfolio; second, to provide sufficient liquidity to meet all operating requirements; and third, to earn a commensurate rate of return consistent with the constraints imposed by the safety and liquidity objectives. The City follows the practice of pooling cash and investments for all funds under its direct control. Funds held by outside fiscal agents under provisions of bond indentures are maintained separately. Interest earned on pooled cash and investments is allocated quarterly to the various Quarterly Investment Report funds based on the respective fund’s average quarterly cash balance. Investment Interest earned from cash and investments with fiscal agents is credited directly to the related accounts. Objectives It is common for governments to pool the cash and investments of various funds to improve investment performance. By pooling funds, the City can benefit from economies of scale, diversification, liquidity, and ease of administration. The City uses the services of an investment advisor, PFM Asset Management, to manage a portion of the City’s portfolio. The City’s strategy is to retain approximately 25% of the portfolio to manage its day-to-day cash flow needs, while PFM’s focus is on longer-term investment management. In addition, the City has retained direct control of several investments that had been acquired before the City began to use investment advisors. All investments are held by the City in a safekeeping account with Bank of New York Mellon, except for investments held by trustees related to bond financings, which are held by either US Bank or Bank of New York Mellon. Page 15 of 29  ESG investing is the process of incorporating the analysis of non-financial environmental, social, and governance factors into investment decisions alongside traditional financial criteria. As set forth in the City’s Investment Management Plan dated August 18, 2020, it is City’s objective to integrate environmental, social, and Environmental, governance (“ESG”) factors into investment decisions Social, for its investment portfolio to the extent practical and and Governance possible. (ESG) Investment In order to achieve this objective, the City will apply the Objectives ESG Investment Criteria to the following Investments: Asset-Backed Securities, Bankers’ Acceptances, Commercial Paper, Corporate, Medium-Term & Bank Notes, and Negotiable Bank Deposit Obligations. The ESG investment criteria is based on ESG Risk Ratings, industry and subindustry definitions, and subindustry rankings as provided by Sustainalytics. Page 16 of 29 ESG Risk Allocation by ESG Risk Rating Composition Not Rated Low Overview 56% 29% The ESG Risk Rating measures economic value at risk based on ESG factors. A company’s ESG Risk Rating is comprised of a quantitative score Medium and a risk category. The score 14% indicates unmanaged ESG risk. High Risk categories are absolute and 1% comparable across industries. Lower scores represent less unmanaged risk. Ratings are scored on a scale of 1-100 and are 41/42 of portfolio issuers are rated with a total rated market value of $49.9 million (43%) assigned to one of the following ESG risk categories: • Negligible Risk (overall score of 0-9.99 points) Negligible Low Medium High Severe • Low Risk (10-19.99 points) • Medium Risk (20-29.99 points) Portfolio Average • High Risk (30-39.99 points) ESG Risk Rating 18.7 • Severe Risk (40 and higher points) Market Value includes accrued interest as of March 31, 2026. Average ESG Risk Rating is weighted by market Page 17 of 29 value. Please see important disclosures at the end of this presentation. * U.S. Treasury and municipal obligations, if held, are not included in the analysis.  Industry Exposure and Weighted Average Risk Score 30 45% 26.8 22.6 22.8 22.1 21.7 Industry 20.3 19.9 Portfolio Weight (%) 20 30% Diversification ESG Risk Rating 17.0 16.1 15.3 14.9 10.2 10 15% 0 0% Portfolio holdings and Sustainalytics data as of March 31, 2026. Average ESG Risk Rating represents the marketPage 18 of 29 value-weighted average ESG risk rating for each industry.  ESG Risk Rating Key Negligible Low Medium High Severe 0-9.99 10-19.99 20-29.99 30-39.99 40-100 S&P Credit Credit Rating Grouped by ESG Risk Rating Category Rating AAA Distribution AA A A-1/A-1+ $0 $5 $10 $15 $20 $25 Market Value Allocation (Millions $) Average ESG Risk Rating by S&P Credit Rating 30 20.2 19.2 20 15.9 15.5 10 0 AAA AA A A-1/A-1+ Portfolio holdings and Sustainalytics data as of March 31, 2026. If a security is not rated by S&P, the equivalent Page 19 of 29 Moody’s rating is used. NR stands for ‘no rating’ and implies that the issuer is not rated by S&P or Moody’s but is rated by Fitch.  ESG Risk Subindustry Issuer % Weight Subindustry Rating Percentile 3/31/26 Communications Cisco Systems, Inc. 1.6% 2 10.2 Equipment Novartis AG 1.3% Pharmaceuticals 1 10.9 Holdings as of The Home Depot, Inc. 0.9% Home Improvement Retail 21 12.6 March 31, Adobe, Inc. 1.0% Enterprise and Infrastructure Software 4 13.3 2026 Visa, Inc. Target Corp. 1.6% 0.7% Data Processing Department Stores 10 2 14.0 14.3 Citigroup, Inc. 2.3% Diversified Banks 11 14.8 Sorted By ESG Asset Management and BlackRock, Inc. 1.1% 4 15.1 Custody Services Risk Rating Coöperatieve Rabobank UA 0.9% Diversified Banks 13 15.5 Deere & Co. 0.7% Agricultural Machinery 18 15.6 National Rural Utilities 0.4% Development Banks 70 16.0 Cooperative Finance Corp. Mastercard, Inc. 0.5% Data Processing 18 16.3 Enterprise and Salesforce, Inc. 0.7% 14 16.3 Infrastructure Software Online and Direct Amazon.com, Inc. 1.5% 5 16.6 Marketing Retail JPMorgan Chase & Co. 3.2% Diversified Banks 16 16.6 Fifth Third Bancorp 0.3% Regional Banks 14 17.3 American Express Co. 1.8% Consumer Finance 15 17.6 Asset Management and State Street Corp. 0.4% 10 18.0 Custody Services AstraZeneca PLC 0.7% Pharmaceuticals 5 18.3 Hyundai Motor Co., Ltd. 1.7% Automobiles 5 18.8 Kubota Corp. 0.5% Agricultural Machinery 34 18.9 Capital One Financial Corp. 0.8% Consumer Finance 21 19.1 Bank of America Corp. 2.5% Diversified Banks 22 19.2 Source: Sustainalytics. Holdings as of March 31, 2026. Page 20 of 29  ESG Risk Subindustry Issuer % Weight Subindustry Rating Percentile 3/31/26 Internet Software and Alphabet, Inc. 1.6% 28 19.9 Services PepsiCo, Inc. 0.7% Packaged Foods 4 19.9 Holdings as of The PNC Financial Services Group, Inc. 0.7% Regional Banks 23 20.5 March 31, Ally Financial, Inc. Eli Lilly & Co. 0.2% 0.7% Consumer Finance Pharmaceuticals 30 8 20.6 20.6 2026 Ford Motor Co. Kenvue, Inc. 0.4% 0.5% Automobiles Personal Products 15 15 21.4 21.7 National Securities Clearing Business Support 1.3% 56 22.1 Sorted By ESG Corp. Services Toyota Motor Corp. 2.1% Automobiles 18 22.5 Risk Rating The Bank of New York 1.4% Asset Management and 26 23.6 Mellon Corp. Custody Services (continued) The Goldman Sachs Group, 0.7% Investment Banking and 21 23.7 Inc. Brokerage Nissan Motor Co., Ltd. 0.2% Automobiles 33 23.8 Investment Banking and Morgan Stanley 1.4% 23 24.0 Brokerage General Motors Co. 0.2% Automobiles 35 24.4 Heavy Machinery and Caterpillar, Inc. 0.8% 18 25.0 Trucks Honda Motor Co., Ltd. 2.0% Automobiles 38 26.0 Verizon Communications, Telecommunication 0.8% 63 26.8 Inc. Services Heavy Machinery and PACCAR, Inc. 0.7% 48 30.7 Trucks Source: Sustainalytics. Holdings as of March 31, 2026. Page 21 of 29 Distribution List City Council Investment Oversight Independent Auditor Committee Erica A. Stewart Badawi & Associates Mayor Emily Francis Council Liaison Michelle Shoresman PFM Asset Vice Mayor Anni Wang Public Member Management Michael R. Boswell Council Member Whitney McDonald Monique Spyke City Manager Managing Director Emily Francis Emily Jackson Justin Resuello Council Member Director of Finance Institutional Sales & Relationship Jan Marx Manager Council Member Debbie Malicoat Deputy Director of Finance/City Controller Riley Kuhn Principal Financial Analyst—Budget Page 22 of 29 Appendix • Additional ESG Information • ESG Themes Information Page 23 of 29  ESG Risk Rating Range and Average by Sector 20.2 ABS Sector Analysis 18.0 Corporate Notes 15.5 Certificates of Deposit 0 5 10 15 20 25 30 35 40 ESG Risk Rating Source: Sustainalytics. Data as of March 31, 2026. Bars represent the range of held issuers’ ESG risk rating thatPage 24 of 29 fall under each sector, and lines indicate the sectors market value-weighted average ESG risk rating. Please see important disclosures at the end of this presentation. ESG Themes Glossary ESG Theme Theme Description Key Indicators Refers to a company’s management of risks • Carbon intensity related to its energy efficiency and • Renewable energy use Carbon Output & greenhouse gas emissions in its operation • Env. Mgt. System certification Energy Use as well as its products and services in the • GHG reporting / risk management production phase and during the product • Hazardous products use phase • Sustainable products & services • Emergency response program • Solid waste management Evaluates the management of emissions • Effluent management and releases from a company’s own • Radioactive waste management Waste & Pollution operations to air, water, and land, excluding • Hazardous waste management greenhouse gas emissions • Non-GHG air emissions programs • Oil spill disclosure & performance Environment • Recycled material use • Biodiversity programs Analyzes how efficiently and effectively a • Deforestation programs / polices company uses its raw material inputs and • Site closure & rehabilitation Resource Use & water in production. It also encompasses • Water intensity & risk management Biodiversity how a company manages the impact of its • Forest certifications operations on land, ecosystems, and wildlife • Supplier environmental programs / certifications • Sustainable agriculture programs Evaluates the community impact from an • Env Impact – Community Relations Community environmental risk perspective based on an • Env Impact – Products & Services Impact assessment of Community Relations, • Env Impact – Occupational Health and Safety (Environmental) Products & Services, Occupational Health • Env Impact – Product Governance and Safety, and Product Governance Page 25 of 29 ESG Themes Glossary ESG Theme Theme Description Key Indicators • Discrimination policy Evaluates the management of risks • Diversity programs related to human rights, labor rights, • Gender pay equality / disclosures Human Capital equality, talent development, • Employee development Management employee retention, and labor health • Supply chain management / standards and safety • Human rights policies & programs • Employee health & safety • Product & service safety programs / Focuses on the management of c certifications risks related to product quality, Product • Data privacy management safety, wellness, and nutrition, as Governance • Media & advertising ethics policy well as customer data privacy & • Organic products / GMO policy cybersecurity • Product health statement Social Assesses how companies engage • Equitable pricing and availability with local communities and their • Access to health care Community management of access to essential • Price transparency Impact (Social) products or services to • Human rights / indigenous policy disadvantaged communities or • Community involvement programs groups • Noise management • Systemic risk management / reporting Analyzes financial stability and • Tier 1 capital issues that pose systemic risks and • Leverage ratio potential external costs to society in ESG Financial Integration • Responsible investment / asset management the financial services industry. Also & Resilience • Underwriting standards measures ESG activities by financial • Financial inclusion institutions • Credit & loan standards • Green buildings investments Page 26 of 29 ESG Themes Glossary ESG Theme Theme Description Key Indicators • Board / management quality & integrity • Board structure • Ownership & shareholder rights Evaluates a company’s rules, policies, and • Remuneration practices with a focus on how a company's • Audit & financial reporting Corporate board of directors manages and oversees • Stakeholder governance Governance Governance the operations of a company. Also assesses • Bribery & corruption policies / programs the management of general professional • Money laundering policy ethics and lobbying activities • Whistleblower programs • Business ethics programs • Political involvement policy • Lobbying and political expenses Page 27 of 29 Disclosures This report contains information developed by Sustainalytics. Such information and data are proprietary of Sustainalytics and/or its third-party suppliers (Third Party Data) and are provided for informational purposes only. The use of the data does not constitute an endorsement of any product or project, nor investment advice and are not warranted to be complete, timely, accurate or suitable for a particular purpose. The use of their data is subject to their conditions. For more information visit http://www.sustainalytics.com/legal-disclaimer. Although PFM Asset Management’s information providers, including without limitation, Sustainalytics, Inc. and its affiliates (the “ESG Parties”), obtain information from sources they consider reliable, none of the ESG Parties warrants or guarantees the originality, accurate and/or completeness of any data herein. None of the ESG Parties make any express or implied warranties of any kind, and the ESG Parties hereby expressly disclaim all warranties of merchantability and fitness for a particular purpose, with respect to any data herein. None of the ESG Parties shall have any liability for any errors or omissions in connect with any data herein. Further, without limiting any of the foregoing, in no event shall any of the ESG Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. There is a risk that the issuers selected to support client sustainable objectives may not perform as expected in addressing sustainability considerations or such performance may change over time, which could cause a client account to temporarily hold securities that are not in alignment with the account’s sustainable objectives. Further, there is a risk that information used to evaluate ESG criteria may not be readily available, complete or accurate, which could negatively impact an account’s ability to apply its sustainable objectives. In managing client's sustainability objectives, PFM Asset Management may rely on analysis and ratings provided by third parties in determining whether an issuer meets an account’s sustainability objectives. A client’s perception may differ from PFM Asset Management’s or a third party’s on how to judge an issuer’s adherence to client's guidelines. PFM Asset Management serves clients in the public sector and is a division of U.S. Bancorp Asset Management, Inc., which is the legal entity providing investment advisory services. U.S. Bancorp Asset Management, Inc. is a registered investment adviser, a direct subsidiary of U.S. Bank N.A. and an indirect subsidiary of U.S. Bancorp. U.S. Bank N.A. is not responsible for and does not guarantee the products, services, or performance of U.S. Bancorp Asset Management, Inc. For more information regarding PFMAM’s services or entities, please visit www.pfmam.com. Page 28 of 29 Disclosures (cont.) The views expressed within this material constitute the perspective and judgment of U.S. Bancorp Asset Management, Inc. at the time of distribution and are subject to change. Any forecast, projection, or prediction of the market, the economy, economic trends, and equity or fixed-income markets are based upon current opinion as of the date of issue and are also subject to change. Opinions and data presented are not necessarily indicative of future events or expected performance. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. No representation is made as to its accuracy or completeness. PFM Asset Management serves clients in the public sector and is a division of U.S. Bancorp Asset Management, Inc., which is the legal entity providing investment advisory services. U.S. Bancorp Asset Management, Inc. is a registered investment adviser, a direct subsidiary of U.S. Bank N.A. and an indirect subsidiary of U.S. Bancorp. U.S. Bank N.A. is not responsible for and does not guarantee the products, services, or performance of U.S. Bancorp Asset Management, Inc. NOT FDIC INSURED : NO BANK GUARANTEE : MAY LOSE VALUE For Institutional Investor or Investment Professional Use Only – This material is not for inspection by, distribution to, or quotation to the general public. Page 29 of 29