                                 CODE OF VIRGINIA

INVESTMENTS OF RETIREMENT SYSTEMS (§ 51.1-803)

A. If the governing body of any county, city, or town establishes a retirement
system pursuant to the provisions of this article, any funds that may be
allocated, segregated, or otherwise designated for the retirement system, which
are on hand at any time and are not necessary for immediate payment of pensions
or benefits, shall be invested with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in a like
capacity and familiar with such matters would use in the conduct of an
enterprise of like character and with the same aims. Such investments shall be
diversified so as to minimize the risk of large losses unless under the
circumstances it is clearly prudent not to do so.

B. The selection of services related to the management, purchase, or sale of
investments authorized by this section, including but not limited to actuarial
services, shall be governed by the standard of care set forth in this section
and shall not be subject to the provisions of the Virginia Public Procurement
Act (&#xA7; 2.2-4300 et seq.) of Title 2.2.

C. In the case of an automatic rollover of a mandatory cash-out, as that term is
defined under I.R.C. Section 401 (a) (31) (B) of the United States Internal
Revenue Code of 1986 (including as such section is amended or renumbered or any
successor provision thereto) and regulations thereunder applicable to
governmental plans, the governing body shall not be liable for any loss
resulting from the governing body&#8217;s selection of an individual retirement
plan provider and investment product where the selection is made in accordance
with guidelines to be adopted by the governing body that are similar to the safe
harbor guidelines adopted by the United States Department of Labor for this
purpose.

HISTORY: 1986, c. 196, § 51-112.1; 1990, c. 832; 1992, c. 810; 1995, c. 307;
1996, c. 508; 1997, c. 213; 2005, c. 196.