RICHMOND, Va. - Virginia Gov. George Allen Jr. last week signed into law a bill that changes the manner in which trustees to the Virginia Retirement System are selected.
The current board will continue to operate for two weeks after new members have been confirmed by the Legislature.
The reconstituted board of trustees will consist of nine members instead of seven. Five will be appointed by the governor and four will be appointed by the Legislature.
Previously, the governor appointed all seven members.
A spokesman for Gov. Allen said he hopes to name his appointees within a week.
The new law also establishes criteria for selecting trustees.
Two of the governor's appointees must have at least five years of experience in the direct management of investment assets; one must have at least five years of experience in the management and administration of defined benefit plans; one must be a local employee; and one must be a faculty member or employee of the state university system.
Two of the legislative trustees must have at least five years of investment experience; one has to be a state employee; and one has to be a teacher.
The changes in the retirement system's makeup follow a report, issued in January, by the state's Joint Legislative Audit Review Committee.
The committee recommended the General Assembly consider amending state law to require the Legislature to appoint some members to the retirement board.
The JLARC's investigation of the pension fund, and the resulting recommendations, were prompted by the retirement system's controversial acquisition of RF&P Corp., a real estate development firm.
The report gave the retirement system a clean bill of health. But the report also was critical of the retirement board's structure and decision-making process.
Separately, the U.S. Attorney's Office reportedly is conducting an investigation into the actions of one or more of the trustees on the board that was just dissolved, possibly in connection with the RF&P deal.
Before leaving office, former Gov. L. Douglas Wilder ordered the state treasury to reimburse VRS Board Chairwoman Jacqueline Epps and any other trustee for legal expenses incurred in connection with that investigation.
Gov. Allen rescinded the order Jan. 21, saying Gov. Wilder exceeded his authority as governor.