ENGROSSED
Senate Bill No. 647
(By Senators Helmick, Sharpe, Chafin, Plymale, Prezioso, Edgell,
Love, Bailey, Bowman, McCabe, Unger, Dempsey, Boley, Minear
Facemyer, Guills and Sprouse)
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[Originating in the Committee on Finance;
reported February 24, 2003.]
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A BILL to amend and reenact section four, article six, chapter
twelve of the code of West Virginia, one thousand nine hundred
thirty-one, as amended, related to modifying the type and
amount of bond required to be obtained and maintained by the
investment management board; and authorizing the establishment
and maintenance of a self-insurance account in connection with
the procurement and maintenance of insurance coverage by the
investment management board.
Be it enacted by the Legislature of West Virginia:
That section four, article six, chapter twelve of the code of
West Virginia, one thousand nine hundred thirty-one, as amended, be
amended and reenacted to read as follows:
ARTICLE 6. WEST VIRGINIA INVESTMENT MANAGEMENT BOARD.
§12-6-4. Management and control of fund; officers; staff;
fiduciary or surety bonds for trustees; liability of trustees.
(a) The management and control of the board shall be vested
solely in the trustees in accordance with the provisions of this
article.
(b) The governor shall be the chairman of the board and the
trustees shall elect a vice chairman who may not be a
constitutional officer or his or her designee to serve for a term
of two years. Effective with any vacancy in the vice chairmanship,
the board shall elect a vice chairman to a new two-year term. The
vice chairman shall preside at all meetings in the absence of the
chairman. Annually, the trustees shall elect a secretary, who need
not be a member of the board, to keep a record of the proceedings
of the board.
(c) The trustees shall appoint a chief executive officer of
the board and shall fix his or her duties and compensation. The
chief executive officer shall have five years' experience in
investment management with public or private funds within the ten
years next preceding the date of appointment. The chief executive
officer additionally shall have academic degrees, professional
designations and other investment management or investment
oversight or institutional investment experience in a combination
the trustees consider necessary to carry out the responsibilities
of the chief executive officer position as defined by the trustees.
(d) The trustees shall retain an internal auditor to report
directly to the trustees and shall fix his or her compensation. The internal auditor shall be a certified public accountant with at
least three years experience as an auditor. The internal auditor
shall develop an internal audit plan, with board approval, for the
testing of procedures and the security of transactions.
(e)
Each trustee shall give a separate fiduciary or surety
bond from a surety company qualified to do business within this
state in a penalty amount of one million dollars for the faithful
performance of his or her duties as a trustee. The board shall
purchase a blanket bond for the faithful performance of its duties
in the amount of fifty million dollars or in an amount equivalent
to one percent of the assets under management, whichever is
greater. The amount of the blanket bond is in addition to the one
million dollar individual bond required of each trustee by the
provisions of this section. The board shall procure and maintain
in effect commercially customary property, liability, crime and
other insurance to cover risks of loss from its operations. The
types and amount of the insurance coverages shall be determined by
the board, in its reasonable discretion, with reference to the
types and amounts of insurance carried by other public institutions
performing functions similar to those performed by the board. The
board may require
a fiduciary or surety bond from a surety company
qualified to do business in this state for any person who has
charge of, or access to, any securities, funds or other moneys held
by the board
and to obtain and maintain appropriate types and amounts of insurance or a fiduciary or surety bond from a surety
company qualified to do business in this state. The amount of the
fiduciary or surety bond shall be fixed by the board.
The premiums
payable on all fiduciary or surety bonds shall be an expense of the
board. In connection with the duties of the board under this
subsection, the board may establish, fund and maintain a self-
insurance account. The amount of moneys, if any, which are
deposited and maintained in the self-insurance account shall be
determined by the board in consultation with one or more qualified
insurance or actuarial consultants and all moneys in any self-
insurance account may be used only for the purpose of providing
self-insurance, establishing reserves in connection with insurance
deductibles, self-insured retentions or self-insurance or helping
to defray the costs of insurance procured under this subsection and
for no other purpose.
(f) The trustees and employees of the board are not liable
personally, either jointly or severally, for any debt or obligation
created by the board:
Provided, That the trustees and employees of
the board are liable for acts of misfeasance or gross negligence.
(g) The board is exempt from the provisions of sections seven
and eleven, article three of this chapter and article three,
chapter five-a of this code:
Provided, That the trustees and
employees of the board are subject to purchasing policies and
procedures which shall be promulgated by the board. The purchasing policies and procedures may be promulgated as emergency rules
pursuant to section fifteen, article three, chapter twenty-nine-a
of this code.
(h) Any employee of the West Virginia trust fund who
previously was an employee of another state agency may return to
the public employees retirement system pursuant to section
eighteen, article ten, chapter five of this code and may elect to
either: (1) Transfer to the public employees retirement system his
or her employee contributions with accrued interest and, if vested,
his or her employer contributions with accrued interest and retain
as credited state service all time served as an employee of the
West Virginia trust fund; or (2) retain all employee contributions
with accrued interest and, if vested, his or her employer
contributions with interest and forfeit all service credit for the
time served as an employee of the West Virginia trust fund.
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