WILLIAM DONALD SCHAEFER, Governor

Ch. 6

(3) THE AMOUNT AUTHORIZED BY THE BOARD OF TRUSTEES TO
IMPLEMENT A CLOSING AGREEMENT WITH THE INTERNAL REVENUE SERVICE
REGARDING FORMER MEMBERS OF THE EMPLOYEES' RETIREMENT SYSTEM OR THE
TEACHERS' RETIREMENT SYSTEM WHO ELECTED TO BECOME MEMBERS OF OR
PARTICIPATE IN THOSE STATE SYSTEMS UNDER FORMER ARTICLE 73B, §§ 2-206 AND
3-206 OF THE CODE.

(B)     PAYMENTS FROM EXPENSE FUND.

THE BOARD OF TRUSTEES SHALL PAY FROM THE EXPENSE FUND OF EACH
STATE SYSTEM ITS PRO RATA SHARE OF:

(1)      THE ADMINISTRATIVE AND OPERATIONAL EXPENSES OF THE
BOARD OF TRUSTEES AND THE STATE RETIREMENT AGENCY, IN ACCORDANCE
WITH THE ANNUAL STATE BUDGET;                                                                           

(2)      THE AMOUNTS AS AUTHORIZED BY THE BOARD OF TRUSTEES
NECESSARY FOR INVESTMENT MANAGEMENT SERVICES; AND

(3)      THE AMOUNTS AS AUTHORIZED BY THE BOARD OF TRUSTEES
NECESSARY TO IMPLEMENT A CLOSING AGREEMENT WITH THE INTERNAL
REVENUE SERVICE REGARDING FORMER MEMBERS OF THE EMPLOYEES'
RETIREMENT SYSTEM OR THE TEACHERS' RETIREMENT SYSTEM WHO ELECTED TO
BECOME MEMBERS OF OR PARTICIPATE IN THOSE STATE SYSTEMS UNDER FORMER
ARTICLE 73B, §§ 2-206 AND 3-206 OF THE CODE.

(C)     ANNUAL ESTIMATE; LIMITATION ON EXPENSES.

EACH YEAR THE BOARD OF TRUSTEES SHALL ESTIMATE:

(1) THE AMOUNT, NOT EXCEEDING 0.2% OF THE PAYROLL OF MEMBERS,
NECESSARY FOR THE ADMINISTRATIVE AND OPERATIONAL EXPENSES OF THE
BOARD OF TRUSTEES AND THE STATE RETIREMENT AGENCY;

(2). THE AMOUNT, NOT EXCEEDING 1.5% OF THE AVERAGE OF THE
MARKET VALUES AS OF JULY 1 AND JUNE 30 OF THE CURRENT FISCAL YEAR OF
ASSETS EXTERNALLY INVESTED IN REAL ESTATE, NECESSARY FOR EXTERNAL REAL
ESTATE INVESTMENT MANAGEMENT SERVICES; AND

(3) THE AMOUNT, NOT EXCEEDING 0.3% OF THE MARKET VALUE AS OF
DECEMBER 31 OF THE PRECEDING FISCAL YEAR OF INVESTED ASSETS THAT ARE
EXTERNALLY MANAGED EXCLUSIVE OF ASSETS INVESTED IN REAL ESTATE,
NECESSARY TO PROCURE AND RETAIN INVESTMENT MANAGEMENT SERVICES
OTHER THAN EXTERNAL REAL ESTATE INVESTMENT MANAGEMENT SERVICES.

(D)     PRO RATA PAYMENT.

THE AMOUNTS ESTIMATED UNDER SUBSECTION (C) OF THIS SECTION SHALL BE
PAID INTO THE EXPENSE FUNDS OF THE SEVERAL SYSTEMS DURING THE ENSUING
YEAR ON A PRO RATA BASIS ACCORDING TO THE TOTAL ASSETS HELD BY EACH
SYSTEM.

(E)     COMBINING EXPENSE FUNDS.

- 427 -