Investment Policy

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University Policy Number 2116

Categorized:

Responsible Office:

Policy Procedure:

Related Law & Policy:


I. Scope

This policy applies to George Mason University’s (“University”) funds that are not held by the Commonwealth of Virginia’s Department of the Treasury (“State Treasury”).

II. Policy Statement

Investment management is a key component of the University’s ability to successfully achieve its financial autonomy while supporting its value of being careful stewards.

Purpose

As an Agency of the Commonwealth of Virginia, the University has an obligation to ensure that all monies under the University’s control follow prudent guidelines and adhere to the deposit and investment requirements established by the Commonwealth of Virginia. The purpose of this investment policy is to establish investment objectives that:

  1. Identify funds that maintain deposit and investment balances;
  2. Delegate authority for oversight of the University’s investment program;
  3. Document investment strategies and permitted investments that comply with Virginia law and are appropriate for each fund’s liquidity needs and investment time horizon;
  4. Comply with fiduciary, prudence, and legal requirements for the assets of the various funds; and
  5. Establish periodic reporting requirements to monitor investment results and compliance with this investment policy.

Identification of Funds

 The University’s funds subject to this investment policy are identified below. These funds may be managed separately or combined based on the University’s portfolio investment strategies.

  1. State Funds: State Funds include tuition and fees, auxiliary enterprises and federal and other monies used for current operations which are deposited into the State Treasury.
  2. Non-State Funds or Local Funds: Funds held by the University that do not meet the definition of State Funds and are not transferred to the Foundation. Any fund designated as Local Funds may be invested in Public Funds Permitted Investments as stated in Appendix B.
  3. Unrestricted Discretionary Funds: Any funds designated as Unrestricted Discretionary Funds may be invested in Public Funds Permitted Investments as stated in Appendix B.
  4. Temporary Operating Funds: These funds include tuition and fees, auxiliary enterprises and federal and other monies that are temporarily held by the University until remitted to the State Treasury. These monies are subject to the Public Funds Permitted Investment guidelines as stated in Appendix B.
  5. Unrestricted Reserve Funds: Funds established to enable internal lending to any approved project or activity may be invested in Public Funds Permitted Investments as stated in Appendix B.
  6. Restricted Capital Project Funds: Monies received as gifts by the University that are restricted to specific capital projects may be invested in Public Funds Permitted Investments as stated in Appendix B.
  7. Restricted Bond Proceeds: Proceeds of tax exempt and taxable municipal bonds should be invested separately in Public Funds Permitted Investments as stated in Appendix B. Investment may be further restricted by any trust indenture, bond resolution, or similar document related to each individual issuance of the municipal bonds.
  8. Restricted Endowment Funds: Monies received as gifts and bequests shall be invested in Endowed Funds Permitted Investments as stated in Appendix C.

Investment Strategies and Permitted Investments

Investment strategy framework is provided for funds based on characteristics and liquidity needs in Appendix A. Appropriate documentation of the individual strategies shall include defining characteristics of the individual funds, primary investment objectives, risk mitigation guidelines, and performance benchmarks. Permitted investments for each fund include either:

  1. Public Funds Permitted Investments: Applicable University funds may be invested in security types permitted by the Virginia Investment of Public Funds Act 2.2-4500 et seq. and in bank deposits collateralized under the guidelines of the Security for Public Deposits Act §2.2-4400 et seq. Details of specific permitted investments are stated in Appendix B.
  2. Endowment Funds Permitted Investments: Endowment funds with a long-term investment horizon may be invested in a broad array of sectors and investment types within strategies that balance the risks and duration of investment losses carefully against the long-term potential for appreciation of assets. The investment of funds shall be subject to the Uniform Prudent Management of Institutional Funds Act (Code of Virginia §64.2-1100 et seq.). Details of permitted investments are stated in Appendix C.

Compliance & Review

 The Senior Vice President for Administration and Finance shall oversee this policy and shall routinely monitor and evaluate investment results on the Funds covered by this policy. The Board of Visitors shall no less than annually review the University’s compliance with this policy.

III. Dates:

A. Effective Date:

This policy will become effective upon the date of approval by the Board of Visitors.

B. Timetable for Review

This policy shall be reviewed every three years or more frequently as needed.

 

Date Approved by the Board of Visitors: October 10, 2018

Revision Approved: July 31, 2020