(a) The general administration and the responsibility for the proper operation of the system and for making effective the provisions of this chapter are hereby vested in the Board of Trustees of the System, which shall be organized immediately after three of the trustees provided for in this section have qualified.

(b) The Board shall consist of six trustees, as follows:

(c) If a vacancy occurs in the office of a trustee, except for the trustee elected by the Board of Directors, Association of Retired Teachers of Vermont, the vacancy shall be filled by the Board, which shall appoint a member of the System to serve until the next regular election is held. A vacancy in the office of the trustee appointed by the Board of Directors, Association of Retired Teachers of Vermont, shall be filled by that Board, which shall appoint a retired member of the System receiving retirement benefits to serve until the next regular election is held.

(d) The trustees as such shall serve without compensation, but they shall be reimbursed from the funds of the System for all necessary expenses that they may incur through service on the Board.

(e) Each trustee shall be entitled to one vote on the Board. Four concurring votes shall be necessary for a decision by the trustees at any meeting of the Board, and four trustees shall constitute a quorum of the Board. Any ex officio trustee may designate in writing a person within the trustee's department, agency, or office to attend a meeting or meetings of the Board of Trustees in the trustee's place. The designation shall be filed with the Secretary of the Board. A person so designated and an alternate attending on behalf of an elected or appointed trustee under this section shall have the same voting rights and responsibilities as the absent trustee at such meeting or meetings, except that the designee or alternate shall not automatically assume the trustee's place as an officer of the Board.

(f) Subject to the limitations of this chapter, the Board shall, from time to time, establish rules and regulations for the administration of the System and for the transaction of its business.

(g) The Board shall elect from its membership a chair and a vice chair, and shall appoint a secretary who shall be the executive officer of the Board and who may or may not be a member of the Board. The Board may employ such actuarial, medical, and other services as shall be required.

(h) The Board shall keep in convenient form such data as shall be necessary for actuarial valuation of the System and for checking the experience of the System.

(i) The Board shall keep a record of all of its proceedings, which shall be open to public inspection. It shall publish annually a report showing the fiscal transactions of the System for the preceding year, the amount of the accumulated cash and securities of the System, and the last balance sheet indicating the financial condition of the System as shown by an actuarial valuation of the assets and liabilities of the System.

(j) The Attorney General of the State shall be the legal advisor to the Board.

(k) The Board shall designate a Medical Board of three physicians who are not eligible to participate in the System. The Medical Board shall arrange for and pass upon all medical examinations required under the provisions of this chapter, shall investigate all essential statements and certificates by or on behalf of a member in connection with application for disability retirement, and shall report in writing to the Board its conclusions and recommendations upon all the matters referred to it. If required, other physicians may be employed to report on special cases.

(l) The Board shall designate an actuary who shall be the technical adviser of the Board on matters regarding the operation of the System and who shall perform such other duties as are required in connection therewith.

(m) Immediately after the establishment of the System, the actuary shall make such investigation of the mortality, service, and compensation experience of the members of the System, as the actuary shall recommend and the Board shall authorize, for the purpose of determining the proper mortality and service tables to be prepared and submitted to the Board for adoption. Having regard to such investigation and recommendation, the Board shall adopt for the System such mortality and service tables as shall be deemed necessary, and shall certify the rates of contribution payable under the provisions of this chapter. At least once in each five-year period following the establishment of the system, the actuary shall make an actuarial investigation into the mortality, service, and compensation experience of the members and beneficiaries of the System, and taking into account the results of such investigation, the Board shall adopt for the System such mortality, service, and other tables as shall be deemed necessary and shall certify the rates of contribution payable under the provisions of this chapter.

(n) On the basis of such mortality and service tables as the Board shall adopt, the actuary shall make annual valuations of the assets and liabilities of the funds of the System.

(o) The Vermont Pension Investment Committee shall designate from time to time a depository for the securities and evidences of indebtedness held in the Pension Fund and may contract for the safekeeping of securities and evidences of indebtedness within and outside the State of Vermont in such banks, trust companies, and safe-deposit facilities as it shall from time to time determine, and the necessary and incidental expenses of such safekeeping and for service rendered, including advisory services in investment matters, shall be paid from the Pension Fund. Any agreement for the safekeeping of securities or evidences of indebtedness, except securities loaned pursuant to a securities lending agreement as authorized by subsection (q) of this section, shall provide for the access to such securities and evidences of indebtedness at any time by the custodian or any authorized agent of the State for audit or other purposes.

(p) The Board shall enter into insurance arrangements to provide health and medical benefits for retired members and their dependents. The State is legally responsible for the costs of the health and medical benefits provided in this chapter in the amounts specified in section 1944e of this chapter. The Board may enter into insurance arrangements to provide dental coverage for retired members and their dependents, provided the State or the System has no legal obligation to pay any portion of the dental benefit premiums.

(q) The Vermont Pension Investment Committee may authorize the loan of its securities pursuant to securities lending agreements that provide for collateral consisting of cash or securities issued or guaranteed by the United States government or its agencies equal to 100 percent or more of the market value of the loaned securities. Cash collateral may be invested by the lending institution in investments approved by the State Treasurer. Approval of investments shall be made in accordance with the standard of care.

(r) The Board shall review annually the amount of State contribution recommended by the actuary of the Retirement System as necessary to achieve and preserve the financial integrity of the fund established pursuant to section 1944 of this title. Based on this review, the Board shall determine the amount of State contribution necessary for the next fiscal year to achieve and preserve the financial integrity of the funds. On or before November 1 of each year, the Board shall inform the Governor and the House and Senate Committees on Government Operations and on Appropriations in writing about the amount needed. The provisions of 2 V.S.A. § 20(d) (expiration of required reports) shall not apply to the report to be made under this subsection. (Amended 1971, No. 155 (Adj. Sess.), eff. March 9, 1972; 1975, No. 175 (Adj. Sess.), § 2; 1987, No. 92, § 4, eff. June 23, 1987; 1989, No. 225 (Adj. Sess.), § 25(b); 1991, No. 151 (Adj. Sess.), §§ 3, 4; 1991, No. 265 (Adj. Sess.), § 2; 1995, No. 36, § 6; 1995, No. 180 (Adj. Sess.), § 38(a); 1999, No. 158 (Adj. Sess.), § 24; 2005, No. 48, § 2; 2005, No. 50, § 6; 2007, No. 13, § 30; 2007, No. 137 (Adj. Sess.), § 6; 2009, No. 74 (Adj. Sess.), § 5; 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012; 2013, No. 92 (Adj. Sess.), § 172, eff. Feb. 14, 2014; 2013, No. 142 (Adj. Sess.), § 28; 2017, No. 165 (Adj. Sess.), § 15; 2018, No. 11 (Sp. Sess.), § E.515.1.)