Virginia Code Title 23.1. Institutions of Higher Education;  Other Educational and Cultural Institutions § 23.1-2803. Investment of endowment funds, endowment income, etc.

A. As used in this section:

“Derivative” means a contract or financial instrument or a combination of contracts and financial instruments, including any contract commonly known as a “swap,” that gives the university the right or obligation to deliver, receive delivery of, or make or receive payments based on changes in the price, value, yield, or other characteristic of a tangible or intangible asset or group of assets or changes in a rate, index of prices or rates, or other market indicator for an asset or group of assets.

“Financial security” means (i) any note, stock, treasury stock, bond, debenture, evidence of indebtedness, certificate of interest, collateral-trust certificate, preorganization certificate of subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, or fractional undivided interest in oil, gas, or other mineral rights;  (ii) any put, call, straddle, option, or privilege on any security, certificate of deposit, or group or index of securities, including any interest therein or based on the value thereof;  (iii) any put, call, straddle, option, or privilege entered into on a national securities exchange relating to foreign currency;  (iv) in general, any interest or instrument commonly known as a “security”;  or (v) any certificate of interest or participation in, temporary or interim security for, receipt for, guarantee of, or warrant or right to subscribe to or purchase any financial security.

“Option” means an agreement or contract whereby the university may grant or receive the right to purchase, sell, or pay or receive the value of any personal property asset, including any agreement or contract that relates to any security, contract, or agreement.

B. The board shall invest and manage the endowment funds, endowment income, gifts, all other nongeneral fund reserves and balances, and local funds of or held by the university in accordance with this section and the provisions of the Uniform Prudent Management of Institutional Funds Act (§ 64.2-1100 et seq.).

C. No member of the board is personally liable for losses suffered by any endowment fund, endowment income, gift, other nongeneral fund reserve and balance, or local funds of or held by the university arising from investments made pursuant to the provisions of subsection B.

D. The investment and management of endowment funds, endowment income, gifts, all other nongeneral fund reserves and balances, or local funds of or held by the university are not subject to the provisions of the Virginia Public Procurement Act (§ 2.2-4300 et seq.).

E. In addition to the investment practices authorized by the Uniform Prudent Management of Institutional Funds Act (§ 64.2-1100 et seq.), the board may invest or reinvest the endowment funds, endowment income, gifts, all other nongeneral fund reserves and balances, and local funds of or held by the university in derivatives, options, and financial securities.

F. The authority provided in this section to invest and reinvest nongeneral fund reserves and balances of or held by the university is predicated upon an approved management agreement between the university and the Commonwealth.