Sec. 34. Fiscal management.
34.1. General duties and powers. The Retirement Board shall be the trustees of the assets of the Retirement Plan. The Retirement Board shall have the power to contract for (1) investment advice, (2) safekeeping of securities, (3) handling of investments, (4) clearing of transactions, and (5) such other services it deems necessary for the proper and efficient handling of the monies and investments of the Retirement Plan. It shall have the power to register or re-register the investments of the Retirement Plan in the name of the Retirement Board as trustees of the Retirement Plan or in the name of its nominee.
34.2. Prudent investor rule. The Retirement Board has a duty to invest and manage the assets of the Retirement Plan solely in the interests of the members and beneficiaries of the Retirement Plan, in the manner set forth in this Section 34.2.
a. The Retirement Board shall invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements, and other circumstances of the Retirement Plan. In satisfying this standard, the Retirement Board shall exercise reasonable care, skill, and caution.
b. The Retirement Board’s investment and management decisions respecting individual assets should not be evaluated in isolation, but rather must be evaluated in the context of the Retirement Plan asset portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the Retirement Plan. The prudent investor rule is a measure of the anticipated effect of the Retirement Board’s investment decisions on the investment portfolio as a whole, given the facts and circumstances prevailing at the time of the investment decision or action. The prudent investor rule shall be interpreted and applied as a test of investment related conduct and not of resulting investment performance.
c. Among circumstances that the Retirement Board shall consider in investing and managing trust assets are such of the following as are relevant to the Retirement Plan or its members and beneficiaries:
(1) General economic conditions;
(2) The possible effect of inflation or deflation;
(3) The expected tax consequences of investment decisions or strategies;
(4) The role that each investment or course of action plays within the overall Retirement Plan portfolio;
(5) The expected total return from income and the appreciation of capital;
(6) The Retirement Plan’s need for liquidity, regularity of income, and preservation or appreciation of capital; and
(7) The fiduciary duty to incur only reasonable and appropriate costs in relation to the assets and the purpose of the Retirement Plan.
d. The Retirement Board shall make a reasonable effort to verify facts relevant to the investment and management of Retirement Plan assets.
e. The Retirement Board may invest in any kind of property or type of investment consistent with the standards of this Section 34.2. If the Retirement Board wishes to invest in an investment category not previously utilized by the Retirement Board for the investment of Retirement Plan assets, it may do so provided that such investment is consistent with the standards of this Section 34.2 and two-thirds of the Retirement Board authorizes the utilization of the new investment category.
34.3. Diversification. The Retirement Board shall diversify the investments of the Retirement Plan unless, after taking into account all relevant circumstances, the Retirement Board reasonably determines that the interests of the members and beneficiaries, as well as the goals and purposes of the Retirement Plan, are better served without diversifying.
34.4. Application to Retirement Plan. Sections 34.2 through 34.4 govern only Retirement Plan investment decisions or actions occurring after July 1, 2013. The Retirement Board has a duty, within a reasonable and appropriate time after July 1, 2013, to review the Retirement Plan investments and to conform the existing Retirement Plan investments to the prudent investor rule. The Retirement Board’s decision to retain or dispose of an investment may be influenced properly by the investment’s special relationship or value to the Retirement Plan.
34.5. Delegations. The Retirement Board may delegate its power to purchase or sell any of the securities and investments of the Retirement Plan to a member or committee of members of the Board.
(Election of 11-13-1973; election of 11-1-1983; election of 9-7-1999; election of 3-12-2013, eff. 6-17-2013)