Code of Virginia

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Code of Virginia
Title 51.1. Pensions, Benefits, and Retirement
Chapter 1. Virginia Retirement System
9/17/2021

Article 2.1. Board of Trustees, Medical Board, and Advisory Committees.

§ 51.1-124.20. Board of Trustees; membership; terms; quorum; compensation and expenses.

A. The Board of Trustees of the Virginia Retirement System is established as an independent board in state government and shall consist of nine members as follows: five members appointed by the Governor and confirmed by the affirmative vote of a majority of those voting in each house of the General Assembly and four members appointed by the Joint Rules Committee and confirmed by the affirmative vote of a majority of those voting in each house of the General Assembly.

B. Members shall be appointed for five-year terms with such members leaving the Board on a staggered basis as initially provided. Appointments to fill vacancies shall be for the unexpired terms. A vacancy of a legislatively appointed trustee shall be filled by the Joint Rules Committee, and any such appointee shall enter upon and continue in office, subject to confirmation at the next session of the General Assembly. If the General Assembly refuses or fails to confirm his appointment, such person shall not be eligible for reappointment.

C. No member shall be eligible to serve for more than two successive five-year terms. After the expiration of an unexpired term to which appointed, or for an initial staggered appointment of less than five years, a member may serve one additional five-year term.

D. Subject to confirmation by the affirmative vote of a majority of those voting in each house of the General Assembly, the Governor shall designate the chairman of the Board from among the Board members described in subsection A above. A chairman may be reappointed and confirmed for additional two-year terms, not to exceed a total of two. However, the initial chairman's one-year term shall not be counted against the two-term limitation, and such person may serve as chairman for five successive years if appointed and confirmed as aforesaid. The chairman shall (i) preside over meetings of the Board; (ii) communicate on behalf of the Board to outside entities interested in the Retirement System; and (iii) perform additional duties as may be set by resolution of the Board. The Board shall elect one of its members as vice-chairman and appoint a secretary who may or may not be a member of the Board. A majority of the members of the Board shall constitute a quorum. The meetings of the Board shall be held at the call of the chairman or whenever the majority of the members so request.

E. Trustees shall receive an initial stipend of $3,000 for each calendar quarter they may serve and a per diem of $300 for each Board meeting attended not to exceed one meeting per day. Commencing July 1, 1995, the stipend shall be increased annually by a percentage equal to the most recent salary structure adjustment as provided in the general appropriation act. The chairman shall receive an additional $1,500 for each calendar quarter served in such capacity. Government employees, still actively employed by any governmental entity, shall receive a per diem of $300 for each Board meeting attended, not to exceed one meeting per day, but shall receive no stipend for their service. Retired government employees shall be entitled to receive a stipend of $3,000 for each calendar quarter they may serve and a per diem of $300 for each Board meeting attended not to exceed one meeting per day. Each Board member shall be entitled to receive reimbursement for all reasonable and necessary expenses incurred for attending Board meetings as provided in §§ 2.2-2813 and 2.2-2825. Any member of the Board who also serves as an officer, director, or member of the board of any corporation organized by the Virginia Retirement System shall be entitled to receive compensation and expenses pursuant to this subsection in addition to any remuneration to which he is entitled by virtue of his service as an officer, director, or member of the board of any corporation organized by the Virginia Retirement System. Funding for the costs of compensation and expenses of the members shall be provided by the Virginia Retirement System.

F. No elected or appointed official shall serve on the Board of Trustees. Except for the faculty member or employee of a public institution of higher education, none of the gubernatorial appointees shall be an employee of state government.

G. The gubernatorial appointees shall be as follows: two shall have a minimum of five years of experience in the direct management, analysis, supervision, or investment of assets; one shall have at least five years of direct experience in the management and administration of employee benefit plans; one shall be a local employee; and one shall be a faculty member or employee of a public institution of higher education.

H. The legislative appointees shall be as follows: two shall have a minimum of five years of experience in the direct management, analysis, supervision, or investment of assets; and one shall be a state employee and one shall be a teacher, as such terms are defined in § 51.1-124.3.

I. State and local government employees appointed to the Board pursuant to this section shall be members of the Retirement System at the time of their appointment, may be actively employed or retired, and if actively employed, shall be given administrative leave from their employment to attend Board and advisory committee meetings.

J. Members of the Board shall be subject to removal from office only as set forth in Article 7 (§§ 24.2-230 through 24.2-238) of Chapter 2 of Title 24.2. The Circuit Court of the City of Richmond shall have exclusive jurisdiction over all proceedings for such removal.

K. Faculty members of public institutions of higher education shall be eligible to serve on the Board pursuant to this section if they are members of the Retirement System at the time of their confirmation to the Board or become members of the Retirement System within 18 months after their confirmation to the Board.

L. All members of the Board shall be citizens of the Commonwealth.

1952, c. 157, §§ 51-111.18 to 51-111.20; 1956, c. 363; 1958, c. 419; 1970, c. 476; 1971, Ex. Sess., c. 88; 1973, c. 523; 1974, c. 353; 1977, c. 620; 1980, cc. 681, 728; 1989, c. 41; 1990, c. 832, § 51.1-109; 1994, cc. 4, 85; 1995, c. 788; 1997, c. 641; 1998, c. 196; 2004, c. 1000.

§ 51.1-124.21. Application of State and Local Government Conflict of Interests Act.

The provisions of the State and Local Government Conflict of Interests Act (§ 2.2-3100 et seq.) shall apply to the members of the Board and the employees of the Virginia Retirement System.

1994, cc. 4, 85.

§ 51.1-124.22. Board to administer Retirement System; powers and duties.

A. The Retirement System shall be administered by the Board of Trustees, whose powers and duties include but are not limited to:

1. Appointing a director, who shall not be a member of the Board, to serve as the chief administrative officer of the Retirement System at the pleasure of the Board.

2. Maintaining records of all of its proceedings and making such records available for inspection by the public.

3. Employing an actuary as its technical advisor and employing other persons and incurring expenditures as it deems necessary for the efficient administration of the Retirement System.

4. Causing an actuarial investigation to be made of all the experience under the Retirement System at least once in each four-year period. The Board shall also cause actuarial gain/loss analyses to be made in conjunction with each actuarial valuation of the System. Pursuant to such investigations and analyses, the Board shall periodically revise the actuarial assumptions used in the computation of employer contribution rates.

5. Causing a biennial actuarial valuation to be made of the assets and liabilities of the Retirement System with respect to each employer. Pursuant to the results of such valuations, the Board shall prepare a statement as to the employer contribution rates applicable to each employer.

6. Publishing the results of each actuarial valuation of the assets and liabilities.

7. Publishing annual financial statements of the Retirement System or annual reports in accordance with §§ 51.1-1000 through 51.1-1003.

8. Promulgating regulations and procedures and making determinations necessary to carry out the provisions of this title.

9. Purchasing insurance to insure against losses suffered by the Retirement System if any member of the Board or of any advisory committee breaches the standard of care in § 51.1-124.30.

10. Adopting rules and policies that bring the Retirement System into compliance with any applicable law or regulation of this Commonwealth or the United States.

11. Establishing and administering, for the officers and employees of the Retirement System, (i) a compensation plan which is consistent with the provisions set forth in the general appropriations act for this purpose and (ii) a grievance procedure which is consistent with the provisions of § 2.2-1202.1 and any regulations promulgated pursuant thereto.

12. Investing in real estate to be held as a nonrevenue producing asset and used by the Retirement System for administrative offices.

13. Charging and collecting administrative fees to pay actual costs incurred by the Retirement System in administering and overseeing any retirement plan or service award fund other than the Virginia Retirement System (§ 51.1-124.1 et seq.), the State Police Officers' Retirement System (§ 51.1-200 et seq.), the Virginia Law Officers' Retirement System (§ 51.1-211 et seq.), or the Judicial Retirement System (§ 51.1-300 et seq.), for which it is responsible from the Commonwealth or participating political subdivisions whose employees benefit under such retirement plans. Any fee charged under the authority granted herein shall be for costs incurred directly related to the administration and oversight of the retirement plan or service award fund, as determined by the Board. Such fee shall be charged to the employer whose employees benefit under the retirement plan and to the service award fund in the case of costs incurred in administering and overseeing service award funds. Overpayments from benefits received under the Virginia Retirement System, the State Police Officers' Retirement System, the Virginia Law Officers' Retirement System, the Judicial Retirement System, the Virginia Sickness and Disability Program under Chapter 11 (§ 51.1-1100 et seq.), the Disability Program for Hybrid Retirement Program Participants under Chapter 11.1 (§ 51.1-1150 et seq.), or Health Insurance Credits for Certain Retirees under Chapter 14 (§ 51.1-1400 et seq.) may be deducted from life insurance benefits payable under Chapter 5 (§ 51.1-500 et seq.).

14. The Board is authorized to charge and collect from participating employers any penalties, interest, compliance fees, or other charges charged to the Retirement System by the Internal Revenue Service or other regulatory body.

B. The Board shall be vested with the powers and duties of the Board of Trustees of the abolished system to the extent necessary for the payment of vested rights and the return of accumulated contributions.

C. The Commonwealth, the Board, employees of the Retirement System, the Investment Advisory Committee of the Retirement System, and any other advisory committee established by the Board shall not incur any liability for any losses suffered by the deferred compensation, the cash match, or the defined contribution retirement plans established or administered under the authority of this title, except as provided in § 51.1-124.30.

1952, c. 157, §§ 51-111.17, 51-111.18, 51-111.21 to 51-111.22:1, 51-111.23, 51-111.68; 1956, c. 363; 1958, c. 419; 1960, c. 400; 1970, c. 476; 1971, Ex. Sess., c. 88; 1973, c. 523; 1974, c. 353; 1975, c. 610; 1977, c. 620; 1980, cc. 681, 728; 1982, c. 478; 1989, c. 41; 1990, c. 832, § 51.1-110; 1994, cc. 4, 85; 1995, c. 307; 1997, c. 711; 1998, c. 176; 2003, cc. 11, 626; 2004, c. 80; 2008, c. 245; 2012, cc. 803, 835; 2014, c. 356.

§ 51.1-124.23. Medical boards.

A. The Board may create one or more medical boards composed of physicians or other health care professionals who are not eligible to participate in the Retirement System. Members of the medical boards created pursuant to this section shall serve at the pleasure of the Board. A medical board created pursuant to this section may appoint physicians or other health professionals to supplement the medical board membership as necessary to render medical decisions involving specific medical specialties or to serve as substitutes when members of such medical board cannot serve in their official capacity. Any such appointments made by the medical board shall be immediately communicated to the Board or its designee.

B. The duties of a medical board created pursuant to this section shall include:

1. Reviewing all reports of medical examinations required by this chapter.

2. Investigating all essential health and medical statements and certificates filed in connection with disability retirement.

3. Submitting to the Board a written report of its conclusions and recommendations on all matters referred to it.

C. A medical board created pursuant to this section, its substitutes, and its employees shall not be held personally liable for conclusions, advice, or recommendations made in accordance with the duties of such medical board under the provisions of this title.

D. The Board is authorized to delegate or assign to any person the authority to appoint medical board membership.

1952, c. 157, § 51-111.26; 1980, cc. 680, 728; 1984, c. 430; 1990, c. 832, § 51.1-112; 1994, cc. 4, 85; 1997, c. 78; 2001, c. 39.

§ 51.1-124.24. Chief investment officer; qualifications; duties.

A. To assist the Board of Trustees in fulfilling its fiduciary duty as trustee of the funds of the Virginia Retirement System, the Board shall employ a chief investment officer to direct, manage, and administer the investment department. The chief investment officer shall be employed under special contract with the Board, shall report directly to the Board, shall serve at the pleasure of the Board, and may be removed by a majority vote of the Board.

B. To ensure that the Board of Trustees receives competent, professional advice regarding its investment decisions from the chief investment officer, the chief investment officer shall demonstrate (i) an ability to oversee, structure, and evaluate institutional investment portfolios and (ii) extensive experience in any two or more of the following areas: domestic equity or fixed-income securities, international equity or fixed-income securities, cash management, alternative investments, managed futures, or large real estate investments. By resolution of the Board, additional qualifications for the chief investment officer may be set.

C. In addition to such duties as the Board of Trustees may include in its special employment contract with the chief investment officer, he shall have the following duties: (i) coordinating asset allocation for all asset classes and subclasses within each class; (ii) supervising, evaluating, and monitoring the investment portfolio and associated investment activities; (iii) facilitating communication between and among the Board of Trustees, advisory committees, employees, members, beneficiaries, and outside entities interested in the investment programs of the retirement system; (iv) enhancing the Board's ability to make effective, prompt decisions in all matters related to investments and the administration of the investment department; and (v) reporting as requested by the General Assembly.

1994, cc. 4, 85.

§ 51.1-124.25. Existing advisory committees of the Virginia Retirement System abolished.

As of March 25, 1994, the existing advisory committees of the Virginia Retirement System are abolished and the members are discharged from any further duties.

1994, cc. 4, 85.

§ 51.1-124.26. Advisory Committees to the Board of Trustees; membership; terms; qualifications; duties.

To further assist the Board of Trustees in fulfilling its fiduciary duty as trustee of the funds of the Retirement System, the Board shall appoint an Investment Advisory Committee to provide the Board with sophisticated, objective, and prudent investment advice. The Investment Advisory Committee shall consist of seven to nine members and each member appointment shall require a two-thirds vote of the Board.

A. In addition, the Board of Trustees may appoint such other advisory committees as it deems necessary. Each member appointment shall require a two-thirds vote of the Board.

B. Each advisory committee shall include no more than two Board members and no individual Board member shall serve on more than one advisory committee. Advisory committee members shall serve at the pleasure of the Board and may be removed by a majority vote of the Board.

C. Except for any Board member who serves on an advisory committee, no elected or appointed official shall serve on an advisory committee.

D. Except for any trustee appointed to the Board between February 28, 1994, and July 1, 1995, no former trustee of the Virginia Retirement System or its predecessors in interest shall, during the five-year period after the termination of his service as a Board member, serve on any advisory committee.

E. Except for Board members, members of any advisory committee shall receive an initial stipend of $1,875 for each calendar quarter they may serve and a per diem of $300 for each meeting attended not to exceed one meeting per day. Commencing July 1, 1995, the stipend shall be increased annually by a percentage equal to the most recent salary structure adjustment as provided in the general appropriation act. Government employees shall receive no stipend for their service but shall be entitled to receive a per diem of $300 for each advisory committee meeting attended not to exceed one meeting per day. Each advisory committee member shall be entitled to receive reimbursement for his actual reasonable and necessary expenses incurred for attending committee meetings. Any member of any advisory committee who also serves as an officer, director, or member of the board of any corporation organized by the Virginia Retirement System shall be entitled to receive compensation and expenses pursuant to this subsection in addition to any remuneration to which he is entitled by virtue of his service as an officer, director, or member of the board of any corporation organized by the Virginia Retirement System.

F. Any Board member who serves on an advisory committee shall not receive the quarterly stipend for advisory committee members provided for in subsection E above, but shall receive the per diem applicable to advisory committee meetings attended in that quarter plus reasonable and necessary expenses incurred.

G. The disclosure requirements of subsection B of § 2.2-3114 of the State and Local Government Conflict of Interests Act shall apply to any member of any advisory committee who is not also a Board member.

H. Members of the Investment Advisory Committee shall demonstrate extensive experience in any one or more of the following areas: domestic or international equity or fixed-income securities, cash management, alternative investments, substantial real estate investments, or managed futures. By resolution of the Board, qualifications for members of any other advisory committee may be set.

The Investment Advisory Committee shall (i) review, evaluate, and monitor investments and investment opportunities, (ii) make appropriate recommendations to the Board about such investments and investment opportunities, and (iii) make recommendations to the Board about overall asset allocation. By resolution of the Board, responsibilities of any other advisory committee may be set.

I. The recommendations of an advisory committee are not binding upon the Board of Trustees.

1994, cc. 4, 85; 1995, c. 788; 1997, c. 641; 1998, c. 196.

§ 51.1-124.27. Employees of the Retirement System.

The officers and employees of the Virginia Retirement System shall be exempt from the provisions of § 2.2-1202.1 and of the Virginia Personnel Act (§ 2.2-2900 et seq.). Personnel actions shall be taken without regard to race, sex, sexual orientation, gender identity, color, national origin, religion, age, handicap, or political affiliation.

1994, cc. 4, 85; 1997, c. 711; 2012, cc. 803, 835; 2020, c. 1137.

§ 51.1-124.28. Legal representation in criminal matters.

Upon the acquittal, dismissal of charges, nolle prosequi, or any other final disposition concluding the innocence of any trustee, advisory committee member, officer, or employee of the Retirement System brought before any regulatory body, summoned before any grand jury, investigated by any law-enforcement agency, arrested, indicted, or otherwise prosecuted on any criminal charge arising out of any act committed in the discharge of his official duties which alleges a violation of state or federal securities laws, the Board may reimburse all or part of the cost of employing legal counsel and such other costs as are demonstrated to have been reasonably necessary for his defense. The Board shall provide for the payment of such legal fees and expenses out of funds appropriated for the administration of the Retirement System.

1997, c. 821.

§ 51.1-124.29. Reserved.

Reserved.