Senate Bill No. 2003
(By Senators Tomblin (Mr. President) and Hall,
By Request of the Executive)
[Introduced July 17, 2010; referred to the Committee on
A BILL to amend and reenact §12-1-12d of the Code of West Virginia,
1931, as amended, relating to investments by Marshall
University and West Virginia University; and extending the
sunset provision to allow the continued investment of funds in
the nonprofit foundations of Marshall University and West
Be it enacted by the Legislature of West Virginia:
of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 1. STATE DEPOSITORIES.
§12-1-12d. Investments by Marshall University and West Virginia
(a) Notwithstanding any provision of this article to the
contrary, the governing boards of Marshall University and West
Virginia University each may invest certain funds with its respective nonprofit foundation that has been established to
receive contributions exclusively for that university and which
exists on the January 1, 2005. Any such investment is subject to
the limitations of this section.
(b) A governing board, through its chief financial officer may
enter into agreements, approved as to form by the State Treasurer,
for the investment by its foundation of certain funds subject to
their administration. Any interest or earnings on the moneys
invested is retained by the investing university.
(c) Moneys of a university that may be invested with its
foundation pursuant to this section are those subject to the
administrative control of the university that are collected under
an act of the Legislature for specific purposes and do not include
any funds made available to the university from the state General
Revenue Fund or the funds established in sections eighteen or
eighteen-a, article twenty-two, chapter twenty-nine of this code.
Moneys permitted to be invested under this section may be
aggregated in an investment fund for investment purposes.
(d) Of the moneys authorized for investment by this section,
Marshall University and West Virginia University each,
respectively, may have invested with its foundation at any time not
more than the greater of:
(1) $18 million for Marshall University and $25 million for
West Virginia University; or
(2) Sixty-five percent of its unrestricted net assets as presented in the statement of net assets for the fiscal year end
audited financial reports.
(e) Investments by foundations that are authorized under this
section shall be made in accordance with and subject to the
provisions of the Uniform Prudent Investor Act codified as article
six-c, chapter forty-four of this code. As part of its fiduciary
responsibilities, each governing board shall establish investment
policies in accordance with the Uniform Prudent Investor Act for
those moneys invested with its foundation. The governing board
shall review, establish and modify, if necessary, the investment
objectives as incorporated in its investment policies so as to
provide for the financial security of the moneys invested with its
foundation. The governing boards shall give consideration to the
(1) Preservation of capital;
(3) Risk tolerance;
(4) Rate of return;
(7) Liquidity; and
(8) Reasonable cost of fees.
(f) A governing board shall report annually by December 31 to
the Governor and to the Joint Committee on Government and Finance
on the performance of investments managed by its foundation pursuant to this section.
(g) The authority of a governing board to invest moneys with
its foundation pursuant to this section expires on
the first day of
July, two thousand ten July 1, 2011.
NOTE: The purpose of this bill is to extend the sunset
provision to allow the continued investment of funds in the
nonprofit foundations of Marshall University and West Virginia
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would