(a) Subject to any limitations necessary to ensure the tax-exempt status of a trust, the sources of funding to a trust may be any of the following:
(1) Appropriations made by the governmental entity.
(2) Contributions by employees and retired employees.
(3) Employer contributions.
(4) Investment income.
(5) Proceeds of any gifts, grants, or contributions.
(6) Transfers from another trust or fund held by a governmental entity.
(7) Bonds, warrants, notes, or other evidence of indebtedness.
(8) All other sources permitted by law.
(b) Subject to payment for fees and reasonable expenses of maintaining a trust, the funds deposited into a trust shall be used for the exclusive purpose of funding post-employment benefit obligations of the governmental entity or entities. The agreements creating a trust shall be irrevocable, subject to subsection (e) of Section 11-104-3 and Section 11-104-8, and the assets of a trust shall not be expended, disbursed, loaned, transferred, or used for any purpose other than to acquire investments, pay reasonable administrative expenses, and provide post-employment benefits to or for retired employees and their dependents. The Legislature may not appropriate the assets of any trust.
(c) The governmental entity or entities may retain, in addition to the trustee, the appropriate administrative and professional services, including, but not limited to, actuaries, attorneys, and investment consultants, to properly maintain a trust and manage and invest the assets held in a trust. The reasonable administrative expenses associated with these services may be paid from the assets of the trust, if so allowed by the written trust agreement.
(d) The trust investments shall be governed by an asset allocation strategy that emphasizes the long-term funding of the trust while investing the assets for the highest investment rate of return consistent with acceptable levels of risk and the actuarially assumed rate of return that is established by the trust's actuary. These investments may include, but are not limited to, stocks, bonds, and various alternative assets, including real estate, hedge funds, and commodities. With respect to each trust that is created, an investment policy guiding the investment of such trust's assets, consistent with this subsection and all other provisions of this chapter, shall be established.