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Management of fund and accounts - 24 Pa. Cons. Stat. § 8521

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                               SUBCHAPTER B
                       RETIREMENT FUND AND ACCOUNTS

     Sec.
     8521.  Management of fund and accounts.
     8522.  Public School Employees' Retirement Fund.
     8523.  Members' savings account.
     8524.  State accumulation account.
     8525.  Annuity reserve account.
     8526.  Health insurance account.
     8527.  Northern Ireland-related investments.
     § 8521.  Management of fund and accounts.
        (a)  Control and management of fund.--The members of the
     board shall be the trustees of the fund. Regardless of any other
     provision of law governing the investments of funds under the
     control of an administrative board of the State government, the
     trustees shall have exclusive control and management of the said
     fund and full power to invest the same, in accordance with the
     provisions of this section, subject, however, to the exercise of
     that degree of judgment, skill and care under the circumstances
     then prevailing which persons of prudence, discretion and
     intelligence who are familiar with such matters exercise in the
     management of their own affairs not in regard to speculation,
     but in regard to the permanent disposition of the fund,
     considering the probable income to be derived therefrom as well
     as the probable safety of their capital. The trustees shall have
     the power to hold, purchase, sell, lend, assign, transfer, or
     dispose of any of the securities and investments in which any of
     the moneys in the fund shall have been invested as well as of
     the proceeds of said investments, including any directed
     commissions which have accrued to the benefit of the fund as a
     consequence of the investments, and of any moneys belonging to
     said fund, subject in every case to meeting the standard of
     prudence set forth in this subsection.
        (b)  Crediting of interest.--The board annually shall allow
     statutory interest to the credit of the members' savings account
     on the mean amount of the accumulated deductions of all members
     for whom interest is payable for the preceding year and
     valuation interest on the mean amount of the annuity reserve
     account for the preceding year to the credit of that account.
     The board annually shall allow valuation interest calculated on
     the mean amount for the preceding year of the balance in the
     State accumulation account excluding any earnings of the fund
     credited to the account during that year. In the event the total
     earnings for the year do not exceed 5 1/2% of the mean amount
     for the preceding year of the total assets of the fund less
     earnings credited to the fund during that year plus the
     administrative expenses of the board, the difference required to
     be appropriated from the General Fund shall be credited to the
     State accumulation account.
        (c)  Custodian of fund.--The State Treasurer shall be the
     custodian of the fund.
        (d)  Payments from fund.--All payments from the fund shall be
     made by the State Treasurer in accordance with requisitions
     signed by the secretary of the board, or his designee, and
     ratified by resolution of the board.
        (e)  Fiduciary status of board.--The members of the board,
     employees of the board, and agents thereof shall stand in a
     fiduciary relationship to the members of the system regarding
     the investments and disbursements of any of the moneys of the
     fund and shall not profit either directly or indirectly with
     respect thereto. The board may, when possible and consistent
     with its fiduciary duties imposed by this subsection or other
     law, including its obligation to invest and manage the fund for
     the exclusive benefit of the members of the system, consider
     whether an investment in any project or business enhances and
     promotes the general welfare of this Commonwealth and its
     citizens, including, but not limited to, investments that
     increase and enhance the employment of Commonwealth residents,
     encourage the construction and retention of adequate housing and
     stimulate further investment and economic activity in this
     Commonwealth. The board shall, through the Governor, submit to
     the General Assembly annually, at the same time the board
     submits its budget covering administrative expenses, a report
     identifying the nature and amount of all existing investments
     made pursuant to this subsection.
        (f)  Name for transacting business.--By the name of "The
     Public School Employees' Retirement System" or "The Public
     School Employes' Retirement System" all of the business of the
     system shall be transacted, its fund invested, all requisitions
     for money drawn and payments made, and all of its cash and
     securities and other property shall be held, except that, any
     other law to the contrary notwithstanding, the board may
     establish a nominee registration procedure for the purpose of
     registering securities in order to facilitate the purchase,
     sale, or other disposition of securities pursuant to the
     provisions of this part.
        (g)  Deposits in banks and trust companies.--For the purpose
     of meeting disbursements for annuities and other payments in
     excess of the receipts, there shall be kept available by the
     State Treasurer an amount, not exceeding 10% of the total amount
     in the fund, on deposit in any bank, savings bank or savings and
     loan association in this Commonwealth organized under the laws
     thereof or under the laws of the United States or with any trust
     company or companies incorporated by any law of this
     Commonwealth, provided any of such banks, trust companies,
     savings banks or savings and loan associations shall furnish
     adequate security for said deposit. The sum deposited in any one
     bank or trust company shall not exceed 25% of the paid-up
     capital and surplus of said bank or trust company or, in the
     case of savings banks or savings and loan associations, shall
     not exceed 25% of the unappropriated surplus.
        (h)  Venture capital, private placement and alternative
     investments.--The board in its prudent discretion may make any
     venture capital investment, private placement investment or
     other alternative investment of any kind, structure or manner
     which meets the standard of prudence set forth in subsection
     (a).
        (i)  Vehicles for authorized investments.--The board in its
     prudent discretion may make any investments which meet the
     standard of prudence set forth in subsection (a) by acquiring
     any type of interest in a business organization existing under
     the laws of any jurisdiction, provided that, in any such case,
     the liability of the Public School Employees' Retirement Fund
     shall be limited to the amount of its investment.
        (j)  Legislative declaration concerning certain authorized
     investments.--The General Assembly finds and declares that
     authorized investments of the fund made by or on behalf of the
     board under this section whereby the board becomes a joint owner
     or stockholder in any company, corporation, association or other
     lawful business organization are outside the scope of the
     original intent of and therefore do not violate the prohibition
     set forth in section 8 of Article VIII of the Constitution of
     Pennsylvania.
     (June 25, 1982, P.L.647, No.183, eff. 60 days; June 29, 1984,
     P.L.450, No.95, eff. imd.; Aug. 5, 1991, P.L.183, No.23, eff.
     imd.; Apr. 29, 1994, P.L.159, No.29, eff. imd.; Dec. 20, 1995,
     P.L.689, No.77, eff. imd.; May 17, 2001, P.L.26, No.9, eff.
     imd.)

        2001 Amendment.  Act 9 amended subsecs. (h), (i) and (j). See
     section 24 of Act 9 in the appendix to this title for special
     provisions relating to authorized investments.
        1994 Amendment.  See section 14 of Act 29 in the appendix to
     this title for special provisions relating to authorized
     investments of the Public School Employees' Retirement Board as
     described in subsec. (i).
        Cross References.  Section 8521 is referred to in section
     8102 of this title.

Last modified: November 27, 2007