Article 21.--KANSAS ENDOWMENT FOR YOUTH FUND, CHILDREN'S INITIATIVES FUND AND RELATED FUNDS; DISPOSITION OF TOBACCO LITIGATION SETTLEMENT PROCEEDS
38-2104.Management and investment of Kansasendowment for youth fund and family and children endowment account of thefamily and children investment fund; investment standards and objectives;contracts with investment advisors and other consultants,requirements.(a) The board of trusteesisresponsiblefor themanagement and investment of the fund and shall discharge the board's dutieswith respect to thefund solely in the interests of the beneficiaries of the fund for the exclusivepurpose of providinginvestment revenue for the purposes for which the moneys may be used anddefraying reasonableexpenses of administering the fund and shall invest and reinvest moneys in thefund and acquire,retain, manage, including the exercise of any voting rights and disposal ofinvestments of the fundwithin the limitations and according to the powers, duties and purposes asprescribed by this section.
(b) Moneys in the fund shall be invested and reinvested to achieve theinvestment objectivewhich is preservation of the fund to provide benefits to the beneficiaries ofthe fund and accordinglyproviding that the moneys are as productive as possible, subject to thestandards set forth in this act.No moneys in the fund shall be invested or reinvested if the sole or primaryinvestment objective isfor economic development or social purposes or objectives.
(c) In investing and reinvesting moneys in the fund and in acquiring,retaining, managing anddisposing of investments of the fund, the board oftrustees shallexercise the judgment, care, skill, prudence and diligence under thecircumstances then prevailing,which persons of prudence, discretion and intelligence acting in a likecapacity and familiar withsuch matters would use in the conduct of an enterprise of like character andwith like aims bydiversifying the investments of the fund so as to minimize the risk of largelosses, unless under thecircumstances it is clearly prudent not to do so, and not in regard tospeculation but in regard to thepermanent disposition of similar funds, considering the probable income as wellas the probablesafety of their capital.
(d) In the discharge of such management and investment responsibilities theboard of trustees may contract for the services ofone or more professionalinvestment advisors or other consultants in the management and investment ofmoneys in the fundand otherwise in the performance of the duties of theboard of trusteesunder this act.
(e) The board of trustees shall require that eachpersoncontracted with under subsection (d) to provide servicesshall obtaincommercial insurance which provides for errors and omissions coverage for suchperson in anamount to be specified by the board of trustees.The amount of suchcoverage specified by the board of trustees shall beat least the greaterof $500,000 or 1% of the funds entrusted to such person up to a maximum of$10,000,000. Theboard of trustees shall require a person contractedwith undersubsection (d) to provide servicesgive a fidelity bondin a penal sum as maybe fixed by law or, if not so fixed, as may be fixed by theboard oftrustees, with corporate surety authorized to do business in this state. Suchpersons contracted withthe board of trustees pursuant to subsection (d)and any persons contracted with such persons to perform the functions specifiedin subsection (b)shall be deemed to be fiduciary agents of the boardof trustees in theperformance of contractual obligations.
(f) (1) Subject to the objective set forth in subsection (b) and thestandards set forth insubsection (c), the board of trustees shallformulate and adopt policiesand objectives for the investment and reinvestment of moneys in the fund andthe acquisition,retention, management and disposition of investments of the fund. Such policiesand objectives shallbe in writing and shall include:
(A) Specific asset allocation standards and objectives;
(B) establishment of criteria for evaluating the risk versus the potentialreturn on a particularinvestment; and
(C) a requirement that all investment advisors, and any managers or otherswith similar dutiesand responsibilities as investment advisors, shall immediately report allinstances of default oninvestments to the board of trustees and providesuch board of trusteeswith recommendations and options, including, but not limited to, curing thedefault or withdrawalfrom the investment.
(2) The board of trustees shall review suchpolicies andobjectives, make changes considered necessary or desirable and readopt suchpolicies and objectiveson an annual basis.
(g) (1) Except as provided in subsection (d) and this subsection, thecustody of money andsecurities of the fund shall remain in the custody of the state treasurer,except that theboard of trustees may arrange for the custody of such moneyand securities asit considers advisable with one or more member banks or trust companies of thefederal reservesystem or with one or more banks in the state of Kansas, or both, to be held insafekeeping by thebanks or trust companies for the collection of the principal and interest orother income or of theproceeds of sale.
(2) The state treasurer and the board of trusteesshall collect the principal and interest or other income of investments or theproceeds of sale of securities in thecustody of the state treasurer and shall pay such moneys when so collected intothe state treasury tothe credit of the fund.
(3) The principal and interest or other income or the proceeds of sale ofsecurities asprovided in paragraph (1) of this subsection shall be reported to the statetreasurer and theboard of trustees and credited to the fund.
(h) All interest or other income of the investments of the moneys in thefund, after paymentof any management fees, shall be considered income of the fund and shall bedeposited in the statetreasury to the credit of the fund.
(i) As used in this section:
(1) "Board of trustees" means the board of trustees of the Kansas publicemployees retirement system established by K.S.A. 74-4905 and amendmentsthereto.
(2) "Fiduciary" means a person who, with respect to the fund, is a personwho:
(A) Exercises any discretionary authority with respect to administration ofthefund;
(B) exercises any authority to invest or manage assets of the fund or has anyauthority orresponsibility to do so;
(C) provides investment advice for a fee or other direct or indirectcompensation with respectto the assets of the fund or has any authority or responsibility to do so;
(D) provides actuarial, accounting, auditing, consulting, legal or otherprofessional servicesfor a fee or other direct or indirect compensation with respect to the fund orhas any authority orresponsibility to do so; or
(E) is a member of the board of trustees or of the staff of the board oftrustees.
(3) "Fund" means the Kansas endowment for youth fund and thefamily and the childrenendowment account of the family and children investment fund.
(4) With respect to the investment of moneys in the Kansas endowment foryouth fund,"purposes for which the moneys may be used" means the purposes for which themoneys in the children’s initiatives fund may be used, as provided inK.S.A. 38-2102 and amendments thereto,and"beneficiaries of the fund" means the beneficiaries of the children'sinitiatives fund, as provided byK.S.A. 38-2102 and amendments thereto.
(5) With respect to the investment of moneys in the family and childrenendowment accountof the family and children investment fund, "purposes for which themoneys may be used" meansthe purposes for which the moneys in the family and children trust account ofthe family and childreninvestment fund may be used, as provided in subsection (c) of K.S.A. 38-1808,andamendments thereto, and "beneficiaries of the fund" means thebeneficiaries of the family andchildren trust account of the family and children investment fund may be used,as provided insubsection (c) of K.S.A. 38-1808, and amendments thereto.
Article 21.--KANSAS ENDOWMENT FOR YOUTH FUND, CHILDREN'S INITIATIVES FUND AND RELATED FUNDS; DISPOSITION OF TOBACCO LITIGATION SETTLEMENT PROCEEDS
38-2104.Management and investment of Kansasendowment for youth fund and family and children endowment account of thefamily and children investment fund; investment standards and objectives;contracts with investment advisors and other consultants,requirements.(a) The board of trusteesisresponsiblefor themanagement and investment of the fund and shall discharge the board's dutieswith respect to thefund solely in the interests of the beneficiaries of the fund for the exclusivepurpose of providinginvestment revenue for the purposes for which the moneys may be used anddefraying reasonableexpenses of administering the fund and shall invest and reinvest moneys in thefund and acquire,retain, manage, including the exercise of any voting rights and disposal ofinvestments of the fundwithin the limitations and according to the powers, duties and purposes asprescribed by this section.
(b) Moneys in the fund shall be invested and reinvested to achieve theinvestment objectivewhich is preservation of the fund to provide benefits to the beneficiaries ofthe fund and accordinglyproviding that the moneys are as productive as possible, subject to thestandards set forth in this act.No moneys in the fund shall be invested or reinvested if the sole or primaryinvestment objective isfor economic development or social purposes or objectives.
(c) In investing and reinvesting moneys in the fund and in acquiring,retaining, managing anddisposing of investments of the fund, the board oftrustees shallexercise the judgment, care, skill, prudence and diligence under thecircumstances then prevailing,which persons of prudence, discretion and intelligence acting in a likecapacity and familiar withsuch matters would use in the conduct of an enterprise of like character andwith like aims bydiversifying the investments of the fund so as to minimize the risk of largelosses, unless under thecircumstances it is clearly prudent not to do so, and not in regard tospeculation but in regard to thepermanent disposition of similar funds, considering the probable income as wellas the probablesafety of their capital.
(d) In the discharge of such management and investment responsibilities theboard of trustees may contract for the services ofone or more professionalinvestment advisors or other consultants in the management and investment ofmoneys in the fundand otherwise in the performance of the duties of theboard of trusteesunder this act.
(e) The board of trustees shall require that eachpersoncontracted with under subsection (d) to provide servicesshall obtaincommercial insurance which provides for errors and omissions coverage for suchperson in anamount to be specified by the board of trustees.The amount of suchcoverage specified by the board of trustees shall beat least the greaterof $500,000 or 1% of the funds entrusted to such person up to a maximum of$10,000,000. Theboard of trustees shall require a person contractedwith undersubsection (d) to provide servicesgive a fidelity bondin a penal sum as maybe fixed by law or, if not so fixed, as may be fixed by theboard oftrustees, with corporate surety authorized to do business in this state. Suchpersons contracted withthe board of trustees pursuant to subsection (d)and any persons contracted with such persons to perform the functions specifiedin subsection (b)shall be deemed to be fiduciary agents of the boardof trustees in theperformance of contractual obligations.
(f) (1) Subject to the objective set forth in subsection (b) and thestandards set forth insubsection (c), the board of trustees shallformulate and adopt policiesand objectives for the investment and reinvestment of moneys in the fund andthe acquisition,retention, management and disposition of investments of the fund. Such policiesand objectives shallbe in writing and shall include:
(A) Specific asset allocation standards and objectives;
(B) establishment of criteria for evaluating the risk versus the potentialreturn on a particularinvestment; and
(C) a requirement that all investment advisors, and any managers or otherswith similar dutiesand responsibilities as investment advisors, shall immediately report allinstances of default oninvestments to the board of trustees and providesuch board of trusteeswith recommendations and options, including, but not limited to, curing thedefault or withdrawalfrom the investment.
(2) The board of trustees shall review suchpolicies andobjectives, make changes considered necessary or desirable and readopt suchpolicies and objectiveson an annual basis.
(g) (1) Except as provided in subsection (d) and this subsection, thecustody of money andsecurities of the fund shall remain in the custody of the state treasurer,except that theboard of trustees may arrange for the custody of such moneyand securities asit considers advisable with one or more member banks or trust companies of thefederal reservesystem or with one or more banks in the state of Kansas, or both, to be held insafekeeping by thebanks or trust companies for the collection of the principal and interest orother income or of theproceeds of sale.
(2) The state treasurer and the board of trusteesshall collect the principal and interest or other income of investments or theproceeds of sale of securities in thecustody of the state treasurer and shall pay such moneys when so collected intothe state treasury tothe credit of the fund.
(3) The principal and interest or other income or the proceeds of sale ofsecurities asprovided in paragraph (1) of this subsection shall be reported to the statetreasurer and theboard of trustees and credited to the fund.
(h) All interest or other income of the investments of the moneys in thefund, after paymentof any management fees, shall be considered income of the fund and shall bedeposited in the statetreasury to the credit of the fund.
(i) As used in this section:
(1) "Board of trustees" means the board of trustees of the Kansas publicemployees retirement system established by K.S.A. 74-4905 and amendmentsthereto.
(2) "Fiduciary" means a person who, with respect to the fund, is a personwho:
(A) Exercises any discretionary authority with respect to administration ofthefund;
(B) exercises any authority to invest or manage assets of the fund or has anyauthority orresponsibility to do so;
(C) provides investment advice for a fee or other direct or indirectcompensation with respectto the assets of the fund or has any authority or responsibility to do so;
(D) provides actuarial, accounting, auditing, consulting, legal or otherprofessional servicesfor a fee or other direct or indirect compensation with respect to the fund orhas any authority orresponsibility to do so; or
(E) is a member of the board of trustees or of the staff of the board oftrustees.
(3) "Fund" means the Kansas endowment for youth fund and thefamily and the childrenendowment account of the family and children investment fund.
(4) With respect to the investment of moneys in the Kansas endowment foryouth fund,"purposes for which the moneys may be used" means the purposes for which themoneys in the children’s initiatives fund may be used, as provided inK.S.A. 38-2102 and amendments thereto,and"beneficiaries of the fund" means the beneficiaries of the children'sinitiatives fund, as provided byK.S.A. 38-2102 and amendments thereto.
(5) With respect to the investment of moneys in the family and childrenendowment accountof the family and children investment fund, "purposes for which themoneys may be used" meansthe purposes for which the moneys in the family and children trust account ofthe family and childreninvestment fund may be used, as provided in subsection (c) of K.S.A. 38-1808,andamendments thereto, and "beneficiaries of the fund" means thebeneficiaries of the family andchildren trust account of the family and children investment fund may be used,as provided insubsection (c) of K.S.A. 38-1808, and amendments thereto.
Article 21.--KANSAS ENDOWMENT FOR YOUTH FUND, CHILDREN'S INITIATIVES FUND AND RELATED FUNDS; DISPOSITION OF TOBACCO LITIGATION SETTLEMENT PROCEEDS
38-2104.Management and investment of Kansasendowment for youth fund and family and children endowment account of thefamily and children investment fund; investment standards and objectives;contracts with investment advisors and other consultants,requirements.(a) The board of trusteesisresponsiblefor themanagement and investment of the fund and shall discharge the board's dutieswith respect to thefund solely in the interests of the beneficiaries of the fund for the exclusivepurpose of providinginvestment revenue for the purposes for which the moneys may be used anddefraying reasonableexpenses of administering the fund and shall invest and reinvest moneys in thefund and acquire,retain, manage, including the exercise of any voting rights and disposal ofinvestments of the fundwithin the limitations and according to the powers, duties and purposes asprescribed by this section.
(b) Moneys in the fund shall be invested and reinvested to achieve theinvestment objectivewhich is preservation of the fund to provide benefits to the beneficiaries ofthe fund and accordinglyproviding that the moneys are as productive as possible, subject to thestandards set forth in this act.No moneys in the fund shall be invested or reinvested if the sole or primaryinvestment objective isfor economic development or social purposes or objectives.
(c) In investing and reinvesting moneys in the fund and in acquiring,retaining, managing anddisposing of investments of the fund, the board oftrustees shallexercise the judgment, care, skill, prudence and diligence under thecircumstances then prevailing,which persons of prudence, discretion and intelligence acting in a likecapacity and familiar withsuch matters would use in the conduct of an enterprise of like character andwith like aims bydiversifying the investments of the fund so as to minimize the risk of largelosses, unless under thecircumstances it is clearly prudent not to do so, and not in regard tospeculation but in regard to thepermanent disposition of similar funds, considering the probable income as wellas the probablesafety of their capital.
(d) In the discharge of such management and investment responsibilities theboard of trustees may contract for the services ofone or more professionalinvestment advisors or other consultants in the management and investment ofmoneys in the fundand otherwise in the performance of the duties of theboard of trusteesunder this act.
(e) The board of trustees shall require that eachpersoncontracted with under subsection (d) to provide servicesshall obtaincommercial insurance which provides for errors and omissions coverage for suchperson in anamount to be specified by the board of trustees.The amount of suchcoverage specified by the board of trustees shall beat least the greaterof $500,000 or 1% of the funds entrusted to such person up to a maximum of$10,000,000. Theboard of trustees shall require a person contractedwith undersubsection (d) to provide servicesgive a fidelity bondin a penal sum as maybe fixed by law or, if not so fixed, as may be fixed by theboard oftrustees, with corporate surety authorized to do business in this state. Suchpersons contracted withthe board of trustees pursuant to subsection (d)and any persons contracted with such persons to perform the functions specifiedin subsection (b)shall be deemed to be fiduciary agents of the boardof trustees in theperformance of contractual obligations.
(f) (1) Subject to the objective set forth in subsection (b) and thestandards set forth insubsection (c), the board of trustees shallformulate and adopt policiesand objectives for the investment and reinvestment of moneys in the fund andthe acquisition,retention, management and disposition of investments of the fund. Such policiesand objectives shallbe in writing and shall include:
(A) Specific asset allocation standards and objectives;
(B) establishment of criteria for evaluating the risk versus the potentialreturn on a particularinvestment; and
(C) a requirement that all investment advisors, and any managers or otherswith similar dutiesand responsibilities as investment advisors, shall immediately report allinstances of default oninvestments to the board of trustees and providesuch board of trusteeswith recommendations and options, including, but not limited to, curing thedefault or withdrawalfrom the investment.
(2) The board of trustees shall review suchpolicies andobjectives, make changes considered necessary or desirable and readopt suchpolicies and objectiveson an annual basis.
(g) (1) Except as provided in subsection (d) and this subsection, thecustody of money andsecurities of the fund shall remain in the custody of the state treasurer,except that theboard of trustees may arrange for the custody of such moneyand securities asit considers advisable with one or more member banks or trust companies of thefederal reservesystem or with one or more banks in the state of Kansas, or both, to be held insafekeeping by thebanks or trust companies for the collection of the principal and interest orother income or of theproceeds of sale.
(2) The state treasurer and the board of trusteesshall collect the principal and interest or other income of investments or theproceeds of sale of securities in thecustody of the state treasurer and shall pay such moneys when so collected intothe state treasury tothe credit of the fund.
(3) The principal and interest or other income or the proceeds of sale ofsecurities asprovided in paragraph (1) of this subsection shall be reported to the statetreasurer and theboard of trustees and credited to the fund.
(h) All interest or other income of the investments of the moneys in thefund, after paymentof any management fees, shall be considered income of the fund and shall bedeposited in the statetreasury to the credit of the fund.
(i) As used in this section:
(1) "Board of trustees" means the board of trustees of the Kansas publicemployees retirement system established by K.S.A. 74-4905 and amendmentsthereto.
(2) "Fiduciary" means a person who, with respect to the fund, is a personwho:
(A) Exercises any discretionary authority with respect to administration ofthefund;
(B) exercises any authority to invest or manage assets of the fund or has anyauthority orresponsibility to do so;
(C) provides investment advice for a fee or other direct or indirectcompensation with respectto the assets of the fund or has any authority or responsibility to do so;
(D) provides actuarial, accounting, auditing, consulting, legal or otherprofessional servicesfor a fee or other direct or indirect compensation with respect to the fund orhas any authority orresponsibility to do so; or
(E) is a member of the board of trustees or of the staff of the board oftrustees.
(3) "Fund" means the Kansas endowment for youth fund and thefamily and the childrenendowment account of the family and children investment fund.
(4) With respect to the investment of moneys in the Kansas endowment foryouth fund,"purposes for which the moneys may be used" means the purposes for which themoneys in the children’s initiatives fund may be used, as provided inK.S.A. 38-2102 and amendments thereto,and"beneficiaries of the fund" means the beneficiaries of the children'sinitiatives fund, as provided byK.S.A. 38-2102 and amendments thereto.
(5) With respect to the investment of moneys in the family and childrenendowment accountof the family and children investment fund, "purposes for which themoneys may be used" meansthe purposes for which the moneys in the family and children trust account ofthe family and childreninvestment fund may be used, as provided in subsection (c) of K.S.A. 38-1808,andamendments thereto, and "beneficiaries of the fund" means thebeneficiaries of the family andchildren trust account of the family and children investment fund may be used,as provided insubsection (c) of K.S.A. 38-1808, and amendments thereto.
