(1) The governing body of each local government that desires to participate in a local government investment pool trust fund shall cooperate in drafting a uniform resolution to be adopted by a majority vote of the governing body of each participating local government. The resolution shall provide for, but need not be limited to, the following: (a) Establishment of a local government investment pool trust fund; (b) A statement of the purposes and objectives of the trust fund, including, but not limited to: (I) The investment objectives of the trust fund; (II) A description of eligible trust fund investments; (III) Credit standards for trust fund investments; (IV) Allowable maturity ranges for trust fund investments; (V) The portfolio concentrations permitted for each type of security owned by the trust fund; and (VI) Supervision of the trust fund by a board of trustees composed of members that are selected from among the treasurers or other local officials empowered to invest local funds of the participating local governments and such other independent and unaffiliated trustees named by such members and, a description of the powers and duties of the board of trustees; (c) Appointment of an administrator with its primary place of business in this state for the trust fund by the board of trustees, the manner of such administrator's appointment, and the duties of such administrator; (d) Appointment of a custodian of the trust fund by the board of trustees and a statement of the powers and duties of the custodian and the custodial arrangements, including, but not limited to: (I) The safekeeping practices utilized for the trust fund; (II) Maximum and minimum account sizes; (III) Maximum and minimum transaction sizes for deposits to and withdrawals from such accounts; (IV) Instructions for establishing accounts and making deposits to and withdrawals from such accounts; and (V) The requirement that the primary records of the trust fund be maintained in this state; (e) Appointment by the board of trustees of an investment adviser with its principal place of business in this state registered with the securities and exchange commission under the federal "Investment Advisers Act of 1940", or licensed as an investment adviser by the securities commissioner, or either a licensed broker-dealer with its primary place of business in this state or a financial institution to act in an advisory capacity, and a description of the duties and obligations of such adviser, advisory broker-dealer, or financial institution; (f) The repayment from the earnings of the trust fund of costs incurred in the establishment of the trust fund; (g) Payment of the expenses of administration from the income received from the earnings of the trust fund; (h) Limitations, if any, on the aggregate amount of moneys which any participating local government may have on deposit in the trust fund at one time; (i) Limitations, if any, on the period of time that the funds of any participating local government may be held in trust; (j) Penalties upon participating local governments for early withdrawal of funds and procedures for resolving other contingencies which may jeopardize the earning potential of the trust fund; except that, any such penalty shall be payable only from earnings on the funds of the participating local government and the amount deposited by each participating local government in the trust fund; (k) Distribution of the income from earnings of the trust fund to participating local governments on a pro rata basis; (l) Maintenance of separate accounts for each participating local government; however, individual transactions and totals of all investments, or the share belonging to each participating local government, shall be recorded in the accounts; (m) Annual audits of trust fund management pursuant to section 11-51-906 (4), C.R.S.; (n) Quarterly reports to each participating local government which show the investments and the earnings thereon pursuant to section 11-51-906 (2), C.R.S.; (o) Disclosure of administrative and associated costs incurred by the trust fund; (p) Purchase of surety or other bonds necessary to protect the trust fund; (q) That neither the trust fund's administrator, investment adviser, or investment adviser representative may act as a principal in the purchase of securities from or the sale of securities to the trust fund; and (r) The method of voting of the trust membership and whether the voting shall be by each participating local government or by number of shares held by any participating local government. (2) The securities commissioner may, by rule or order and subject to such terms and conditions as prescribed therein, waive any of the requirements set forth in subsection (1) of this section if the securities commissioner finds that the applicability of such requirements is not necessary in the public interest and for the protection of participating local governments. (3) By separate resolution similarly adopted, the governing body of each participating local government shall authorize investment of any moneys in its treasury, which are not immediately required to be disbursed, in a local government investment pool trust fund established pursuant to this section. The resolution shall name the local government official, who may be the treasurer or other official empowered to invest local funds, responsible for deposit and withdrawal of such funds. In making such deposits and withdrawals, such official shall use prudence and care to preserve the principal and to secure the maximum rate of interest consistent with safety and liquidity. The resolution shall be filed with the board of trustees of the trust fund. (4) Any local government which invests in a local government investment pool trust fund shall make available for public inspection the name, address, and telephone number of any such trust fund in which the local government has deposited funds, as well as the most recent information statement or prospectus provided by such trust fund describing the funds, investments, and performance, including net rate of return earned for the most recent year or quarter after deduction of administrative expenses.
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