H. B. 4746


(By Delegates Michael, R. M. Thompson, H. White,

Hall, Campbell and Leach)


(Originating in the Committee on Finance)


[March 1, 2004]


A BILL to amend and reenact §12-1-2, §12-1-7, §12-1-12 and §12-1-13 of the code of West Virginia, 1931, as amended; to amend and reenact §12-2-1 of said code; to amend and reenact §12-3-1 and §12-3-1a of said code; to amend and reenact §12-3A-3, §12-3A-4 and §12-3A-6 of said code; to amend and reenact §12-5-1 and §12-5-5 of said code; to amend and reenact §12-6-5 and §12-6-8 of said code; and to amend and reenact §18-30-4 of said code, all relating generally to the state treasurer's office; designating financial institutions as depositories for state funds; adding state and federal savings and loan associations as candidates for depository banks; defining spending unit for the purposes of chapter twelve of the code; allowing only the treasurer to enter into contracts for banking goods and services, except for the auditor obtaining the purchasing card; requiring financial institutions outside the state with state funds to meet the same collateral requirements for other depositories; clarifying that the treasurer may pay for banking goods and services by maintaining a compensating balance in an account other than only accounts that do not earn interest; adding electronic funds transfers to the methods the state uses to receive moneys; amending procedures for stale dated checks and requiring the treasurer to search for the payee; requiring spending units which have payments in which the checks have become stale to inform the treasurer's office when the stale dated checks contain federal funds, the amount of the federal funds and which account should receive the funds; specifying legal effect of documents and electronic signatures; adding the treasurer as additional administrator of the West Virginia check card; allowing the state treasurer to authorize spending units to assess and collect fees for electronic commerce receipts; requiring the state treasurer to issue legislative rules to authorize spending units to assess and collect fees for electronic commerce receipts; adding cash to the definition of securities; creating fund in treasury to allow for the deposit of cash into safekeeping and allowing the treasurer to invest the money and to prescribe forms and procedures for processing the moneys; amending provisions related to investment of funds of political subdivisions; requiring treasurer to contract with political subdivisions; changing the qualifications for certain members of the West Virginia college prepaid tuition and savings program and changing the appointment process of two members of the West Virginia college prepaid tuition and savings program.

Be it enacted by the Legislature of West Virginia:
That §12-1-2, §12-1-7, §12-1-12 and §12-1-13 of the code of West Virginia, 1931, as amended, be amended and reenacted; that §12-2-1 of said code be amended and reenacted; that §12-3-1 and §12-3-1a of said code be amended and reenacted; that §12-3A-3, §12-3A-4 and §12-3A-6 of said code be amended and reenacted; that §12-5-1 and §12-5-5 of said code be amended and reenacted; that §12-6-5 and §12-6-8 of said code be amended and reenacted; and that §18-30-4 of said code be amended and reenacted, all to read as follows:
CHAPTER 12. PUBLIC MONEYS AND SECURITIES.

ARTICLE 1. STATE DEPOSITORIES.
§12-1-2. Depositories for demand deposits; categories of demand deposits; competitive bidding for disbursement accounts; maintenance of deposits by state treasurer; definition of spending unit.

The state treasurer shall designate the state and national banks and the state and federal savings and loan associations in this state which shall serve meeting the requirements of this chapter as depositories for all state funds placed in demand deposits. Any such state or national bank shall, upon request to the treasurer, be designated as a state depository for such deposits, if such bank meets the requirements set forth in this chapter.
Demand deposit accounts shall consist of receipt and disbursement accounts. Receipt accounts shall be those are accounts in which are deposited moneys belonging to or due the state of West Virginia or any official, department, board, commission or agency thereof.
Disbursement accounts shall be those are accounts from which are paid moneys due from the state of West Virginia or any official, department, board, commission, political subdivision or agency thereof to any political subdivision, person, firm or corporation, except moneys paid from investment accounts. Investment accounts shall be those are accounts established by the West Virginia investment management board or the state treasurer for the buying and selling of securities for investment for the state of West Virginia purposes.
The state treasurer shall promulgate rules, in accordance with the provisions of article three, chapter twenty-nine-a of this code, concerning depositories for receipt accounts prescribing the selection criteria, procedures, compensation and such other contractual terms as it considers to be in the best interests of the state giving due consideration to: (1) The activity of the various accounts maintained therein; (2) the reasonable value of the banking services rendered or to be rendered the state by such depositories; and (3) the value and importance of such deposits to the economy of the communities and the various areas of the state affected thereby.
The state treasurer shall select depositories for disbursement accounts through competitive bidding by eligible banks in this state. If none of the eligible banks in this state are able to provide the needed services, then the treasurer may include eligible banks outside this state in the competitive bidding process. The treasurer shall promulgate rules in accordance with the provisions of article three, chapter twenty-nine-a of this code, prescribing the procedures and criteria for the bidding and selection. The treasurer shall, in the invitations for bids, specify the approximate amounts of deposits, the duration of contracts to be awarded and such other contractual terms as it considers to be in the best interests of the state the treasurer considers to be in the best interests of the state, consistent with obtaining the most efficient service at the lowest cost.
The amount of money needed for current operation purposes of the state government, as determined by the state treasurer, shall be maintained at all times in the state treasury, in cash, in short term investments not to exceed five days, or in disbursement accounts with banks financial institutions designated as depositories in accordance with the provisions of this section. No state officer or employee shall make or cause to be made any deposits of state funds in banks not so designated. Only banks and state and federal savings and loan associations designated by the treasurer as depositories may accept deposits of state funds. As used in this chapter, "spending unit" means a department, agency, board, commission or institution of state government for which an appropriation is requested, or to which an appropriation is made by the Legislature.
§12-1-7. Rules; banking contracts and agreements; depositors; agreements.

In addition to rules specially authorized in this article, the West Virginia investment management board and the state treasurer are generally authorized to promulgate any rules necessary to protect the interests of the state, its depositories and taxpayers. All rules promulgated shall be are subject to the provisions of article three, chapter twenty-nine-a of this code. Any rules previously established by the board of public works, the board of investments, the investment management board or the state treasurer pursuant to this article shall remain in effect until amended, superseded or rescinded.
Only the treasurer may enter into contracts or agreements with financial institutions for banking goods or services required by spending units. A state spending unit requiring banking goods or services shall submit a request for the goods or services to the treasurer. If the treasurer enters into a contract or agreement for the required goods or services, spending units using the contract or agreement shall pay either the vendor or the treasurer for the goods or services used.
The treasurer is also authorized to enter into any depositors' agreements for the purpose of reorganizing or rehabilitating any depository in which state funds are deposited, and for the purpose of transferring the assets, in whole or in part, of any depository to any other lawful depository when, in the judgment of the treasurer, the interests of the state will be are promoted thereby, and upon condition that no right of the state to preferred payment be is waived.
§12-1-12. Investing funds in treasury; depositories outside the state.

When the funds in the treasury exceed the amount needed for current operational purposes, as determined by the treasurer, the treasurer shall make all of such excess available for investment by the investment management board which shall invest the excess for the benefit of the general revenue fund: Provided, That the state treasurer, after reviewing the cash flow needs of the state, may withhold and invest amounts not to exceed one hundred twenty-five million dollars of the operating funds needed to meet current operational purposes. Investments made by the state treasurer under this section shall be made in short term investments not to exceed five days. Operating funds means the consolidated fund established in section eight, article six of this chapter, including all cash and investments of the fund.
Spending units with authority to retain interest or earnings on a fund or account may submit requests to the treasurer to transfer moneys to a specific investment pool of the investment management board and retain any interest or earnings on the money invested. The general revenue fund shall receive all interest or other earnings on money invested that are not designated for a specific fund or account.
Whenever the funds in the treasury exceed the amount for which depositories within the state have qualified, or the depositories within the state which have qualified are unwilling to receive larger deposits, the treasurer may designate depositories outside the state, disbursement accounts being bid for in the same manner as required by depositories within the state, and when such depositories outside the state have qualified by giving the bond prescribed in section four of this article, the state treasurer shall deposit funds therein in like in the same manner as funds are deposited in depositories within the state under this article.
The state treasurer may transfer funds to banks financial institutions outside the state to meet obligations to paying agents outside the state and any such transfer if the financial institution must meet meets the same bond collateral requirements as set forth in this article.
§12-1-13. Payment of banking services and litigation costs for prior investment losses.

(a) The treasurer is authorized to pay for banking services, and goods and services ancillary thereto, by either a compensating balance in a noninterest-bearing an account maintained at the financial institution providing the services or with a state warrant as described in section one, article five three of this chapter.
(b) The investment management board is authorized to pay for the investigation and pursuit of claims against third parties for the investment losses incurred during the period beginning on the first day of August, one thousand nine hundred eighty-four, and ending on the thirty-first day of August, one thousand nine hundred eighty-nine. The payment may be in the form of a state warrant.
(c) If payment is made by a state warrant, the investment management board, at the request of the treasurer, is authorized to establish within the consolidated fund an investment pool which will generate sufficient income to pay for all banking services provided to the state and to pay for the investigation and pursuit of the prior investment loss claims. All income earned by the investment pool shall be paid into a special account of the treasurer to be known as the banking services account and shall be used solely for the purpose of paying to pay for all banking services and goods and services ancillary to the banking services provided to the state, for the investigation and pursuit of the prior investment loss claims, amortize and for amortization of the balance in the investment imbalance fund.
ARTICLE 2. PAYMENT AND DEPOSIT OF TAXES AND OTHER AMOUNTS DUE THE STATE OR ANY POLITICAL SUBDIVISION.

§12-2-1. How and to whom taxes and other amounts due the state or any political subdivision, official, department, board, commission or other collecting agency thereof may be paid.

All persons, firms and corporations shall promptly pay all taxes and other amounts due from them to the state, or to any political subdivision, official, department, board, commission or other collecting agency thereof authorized by law to collect the taxes and other amounts due by any authorized commercially acceptable means, in money, United States currency or by check, bank draft, certified check, cashier's check, post office money order, or express money order or electronic funds transfer payable and delivered to the official, department, board, commission or collecting agency thereof authorized by law to collect the taxes and other amounts due and having the account upon which the taxes or amounts due are chargeable against the payer of the taxes or amounts due. The duly elected or appointed officers of the state and of its political subdivisions, departments, boards, commissions and collecting agencies having the account on which the taxes or other amounts due are chargeable against the payer of the taxes or other amounts due and authorized by law to collect the taxes or other amounts due, and their respective agents, deputies, assistants and employees shall in no case be the agent of the payer in and about the collection of the taxes or other amounts, but shall at all times and under all circumstances be the agent of the state, its political subdivision, official, department, board, commission or collecting agency having the account on which the taxes or amounts are chargeable against the payer of the taxes or other amounts due and authorized by law to collect the same.
ARTICLE 3. APPROPRIATIONS, EXPENDITURES AND DEDUCTIONS.
§12-3-1. Manner of payment from treasury; form of checks.
(a) Every person claiming to receive money from the treasury of the state shall apply to the auditor for a warrant for same. The auditor shall thereupon examine the claim, and the vouchers, certificates and evidence, if any, offered in support thereof, and for so much thereof as he or she finds to be justly due from the state, if payment thereof is authorized by law, and if there is an appropriation not exhausted or expired out of which it is properly payable, the auditor shall issue his or her warrant on the treasurer, specifying to whom and on what account the money mentioned therein is to be paid, and to what appropriation it is to be charged. The auditor shall present to the treasurer daily reports on the number of warrants issued, the amounts of the warrants and the dates on the warrants for the purpose of effectuating the investment policy policies of the state treasurer and the investment management board. On the presentation of the warrant to the treasurer, the treasurer shall ascertain whether there are sufficient funds in the treasury to pay that warrant, and if he or she finds it to be so, he or she shall in that case, but not otherwise, endorse his or her check upon the warrant, directed to some depository, which check shall be payable to the order of the person who is to receive the money therein specified.
(b) If the a check is not presented for payment within six months after it is drawn, it shall then be is the duty of the treasurer to credit it to the depository on which it was drawn, to credit the unclaimed property fund pursuant to the provisions of article eight, chapter thirty-six of this code "Treasurer's Stale Check Fund," which is hereby created in the state treasury, and immediately notify the auditor to make corresponding entries on the auditor's books. If the state treasurer determines any funds deposited in the stale check account are federal funds, the state treasurer shall notify the spending unit authorizing the payment. Within six months following issuance of the notice, the spending unit shall inform the state treasurer of the amount of federal funds included in the check, the account from which the federal funds were disbursed, and the current fiscal year account to which the federal funds are to be transferred. After receiving the information, the state treasurer shall transfer the amount of federal funds specified as a reimbursement to the current fiscal year account specified to receive federal funds by the spending unit. For a period of up to six months, the state treasurer shall endeavor to pay the money in the stale check account to the payee. The treasurer shall credit the money that has been in the stale check account for six months, or for a shorter period as determined by the treasurer, to the unclaimed property fund pursuant to the provisions of article eight, chapter thirty-six of this code, and shall immediately notify the auditor to make corresponding entries on the auditor's books.
(c) No state depository may pay a check unless it is presented within six months after it is drawn and every check shall bear upon its face the words "Void, unless presented for payment within six months."
(d) Any information or records maintained by the treasurer concerning any check which has not been not presented for payment within six months of the date of issuance may only be disclosed is confidential and exempt from disclosure under the provisions of article one, chapter twenty-nine-b of this code, and is disclosable only to the state agency specified on spending unit authorizing the check, or to the payee, his or her personal representative, next of kin or attorney-at-law. and is otherwise confidential and exempt from disclosure under the provisions of article one, chapter twenty-nine-b of this code
(e) All claims required by law to be allowed by any court, and payable out of the state treasury, shall have the seal of the court allowing or authorizing the payment of the claim affixed by the clerk of the court to his or her certificate of its allowance. No claim may be audited and paid by the auditor unless the seal of the court is thereto attached as aforesaid. No tax or fee may be charged by the clerk for affixing his or her seal to the certificate, referred to in this section. The treasurer shall propose rules in accordance with the provisions of article three, chapter twenty-nine-a of this code governing the procedure for such payments from the treasury.
§12-3-1a. Payment by deposit in bank account.
The auditor may issue his warrant on the treasurer to pay any person claiming to receive money from the treasury by deposit to the person's account in any bank or other financial institution by electronic funds transfer, if the person furnishes authorization of the method of payment. The auditor shall prescribe the form of the authorization. If the authorization is in written form, it shall be sent to the auditor for review and approval and then forwarded in electronic form to the treasurer. If the authorization is in electronic form, it shall be sent to both the auditor and the treasurer. The auditor must review and approve the authorization. This section shall may not be construed to require the auditor to utilize the method of payment authorized by this section. An authorization furnished pursuant to this section may be revoked by written notice furnished to the auditor and then forwarded by the auditor in electronic form to the treasurer or by electronic notice furnished to both the auditor and the treasurer. Upon execution of the authorization and its receipt by the office of the auditor, the warrant shall be created in the manner specified on the authorization and forwarded to the treasurer for further disposition to the designated bank or other financial institution specified on the electronic warrant: Provided, That after the first day of July, two thousand two, the state auditor shall cease issuing paper warrants except for income tax refunds. After that date all warrants except for income tax refunds, shall be issued by electronic funds transfer: Provided, however, That the auditor, in his or her discretion, may issue paper warrants on an emergency basis. Provided further, That the treasurer and the auditor may contract with any bank or financial institution for the processing of electronic authorizations
ARTICLE 3A. FINANCIAL ELECTRONIC COMMERCE.
§12-3A-3. Financial electronic commerce.
The state auditor and the state treasurer shall implement electronic commerce capabilities for each of their offices to facilitate the performance of their duties under this code. The state auditor and the shall competitively bid the selection of vendors for the payment card program, the state treasurer shall competitively bid the selection of vendors needed to provide the necessary banking, investment and related goods and services, for their offices and the provisions of article one-b, chapter five, and articles three and seven, chapter five-a of this code shall not apply, unless requested by the state auditor or state treasurer.
A record, or an authentication, a document or a signature issued or used by the auditor, or the treasurer shall be considered an original and may not be denied legal effect solely on the ground that it is in electronic form.
The head of each spending unit is responsible for adopting and implementing security procedures to ensure adequate integrity, security, confidentiality, and auditability of the business transactions of his or her spending unit when utilizing electronic commerce.
§12-3A-4. Payment by the West Virginia check card.
The state auditor and the state treasurer may establish a state debit card known as the "West Virginia Check Card" for recipients of employee payroll or of retirement, benefits or entitlement programs processed by the auditor who are considered unbanked and who do not possess a federally insured depository institution account. The state auditor and the state treasurer shall use every reasonable effort to make a federally insured depository account available to a recipient, and to encourage all recipients to obtain a federally insured depository account. Prior to issuing the West Virginia check card, the state auditor and the state treasurer shall first make a determination that a recipient has shown good cause that an alternative method to direct deposit is necessary. The state auditor and the state treasurer shall jointly issue a request for proposals in accordance with section three of this article to aid the auditor in the administration of the program and to aid the treasurer in the establishment of state owned bank accounts and accommodate accessible locations for use of the West Virginia check card. In carrying out the purposes of this article, the state auditor and state treasurer shall not compete with banks or other federally insured financial institutions, or for profit.
§12-3A-6. Receipting of electronic commerce purchases.
(a) The state treasurer may establish a system for acceptance of credit card and other payment methods for electronic commerce purchases from spending units. Notwithstanding any other provision of this code to the contrary, each spending unit utilizing WEB commerce, electronic commerce or other method that offers products or services for sale shall utilize the state treasurer's system for acceptance of payments.
(b) To facilitate electronic commerce, the state treasurer may charge a spending unit for the banking and other expenses incurred by the treasurer on behalf of the spending unit and for any work performed, including, without limitation, assisting in the development of a website and utilization of the treasurer's payment gateway. A special revenue account, entitled the "Treasurer's Financial Electronic Commerce Fund," is created in the state treasury to receive the amounts charged by the treasurer. The treasurer may expend the funds received in the Treasurer's Financial Electronic Commerce Fund only for the purposes of this article and for other purposes as determined by the Legislature.
(c) The state treasurer may authorize a spending unit to assess and collect a fee to recover or pay the cost of accepting bank, charge, check, credit or debit cards from amounts collected. The state treasurer shall propose legislative rules for promulgation in accordance with the provisions of article three of chapter twenty-nine-a of this code to establish the criteria and procedures involved in granting the authorization and may promulgate emergency rules in accordance with the provisions of article three of chapter twenty-nine-a of the code to implement the provisions of this section prior to authorization of the legislative rules.
ARTICLE 5. PUBLIC SECURITIES.
§12-5-1. Securities defined.
The term "securities" when used in this article shall include all bonds, securities, debentures, notes or other evidences of indebtedness, and for purposes of this chapter all cash received with restrictions on expenditures, whether by court order or otherwise.
§12-5-5. Protection and handling of securities.
(a) The noncash securities retained in the treasury shall be kept in a vault. The treasurer shall use due diligence in protecting the securities against loss from any cause. The treasurer shall designate certain employees to take special care of the securities. Only the treasurer and the designated employees may have access to the securities, and at least two of these persons shall be present whenever the securities are handled in any manner. The treasurer may contract with one or more banking institutions in or outside the state for the custody, safekeeping and management of securities. The contract shall prescribe the rules for the handling and protection of the securities.
(b) The "Treasurer's Safekeeping Fund" is established in the state treasury. The treasurer shall deposit moneys received pursuant to this article in the Treasurer's Safekeeping Fund. The treasurer is authorized to invest the money in accordance with this code and the restrictions placed on the money, with earnings accruing to the moneys in the fund. The treasurer shall prescribe the forms and procedures for processing the moneys.
ARTICLE 6. WEST VIRGINIA INVESTMENT MANAGEMENT BOARD.
§12-6-5. Powers of the board.
The board may exercise all powers necessary or appropriate to carry out and effectuate its corporate purposes. The board may:
(1) Adopt and use a common seal and alter it at pleasure;
(2) Sue and be sued;
(3) Enter into contracts and execute and deliver instruments; (4) Acquire (by purchase, gift or otherwise), hold, use and dispose of real and personal property, deeds, mortgages and other instruments;
(5) Promulgate and enforce bylaws and rules for the management and conduct of its affairs;
(6) Notwithstanding any other provision of law, retain and employ legal, accounting, financial and investment advisors and consultants;
(7) Acquire (by purchase, gift or otherwise), hold, exchange, pledge, lend and sell or otherwise dispose of securities and invest funds in interest earning deposits and in any other lawful investments;
(8) Maintain accounts with banks, securities dealers and financial institutions both within and outside this state;
(9) Engage in financial transactions whereby securities are purchased by the board under an agreement providing for the resale of the securities to the original seller at a stated price;
(10) Engage in financial transactions whereby securities held by the board are sold under an agreement providing for the repurchase of the securities by the board at a stated price;
(11) Consolidate and manage moneys, securities and other assets of the other funds and accounts of the state and the moneys of political subdivisions which may be made available to it under the provisions of this article;
(12) Enter into agreements with political subdivisions of the state whereby moneys of the political subdivisions are invested on their behalf by the board Accept and invest funds transferred to the board by the state treasurer on behalf of the state and political subdivisions;
(13) Charge and collect administrative fees from political subdivisions for its services;
(14) Exercise all powers generally granted to and exercised by the holders of investment securities with respect to management of the investment securities;
(15) Contract with one or more banking institutions in or outside the state for the custody, safekeeping and management of securities held by the board;
(16) Make and, from time to time, amend and repeal bylaws, regulations and procedures not inconsistent with the provisions of this article;
(17) Hire its own employees, consultants, managers and advisors as it considers necessary and fix their compensation and prescribe their duties;
(18) Develop, implement and maintain its own banking accounts and investments;
(19) Do all things necessary to implement and operate the board and carry out the intent of this article;
(20) Require the state auditor and treasurer to transmit state funds on a daily basis for investment: Provided, That money held for meeting the daily obligations of state government need not be transferred;
(21) (20) Upon request of the treasurer, transmit funds for deposit in the state treasury to meet the daily obligations of state government;
(22) (21) Establish one or more investment funds for the purpose of investing the funds for which it is trustee, custodian or otherwise authorized to invest pursuant to this article. Interests in each fund shall be designated as units and the board shall adopt industry standard accounting procedures to determine each fund's unit value. The securities in each investment fund are the property of the board and each fund shall be considered an investment pool or fund and may not be considered a trust nor may the securities of the various investment funds be considered held in trust. However, units in an investment fund established by or sold by the board and the proceeds from the sale or redemption of any unit may be held by the board in its role as trustee of the participant plans; and
(23) (22) Notwithstanding any other provision of the code to the contrary, conduct investment transactions, including purchases, sales, redemptions and income collections, which shall not be treated by the auditor as recordable transactions on the state's accounting system.
§12-6-8. Investment funds established; management thereof.
(a) There is hereby continued a special investment fund to be managed by the board and designated as the "consolidated fund."
(b) Each board, commission, department, official or agency charged with the administration of state funds may request the state treasurer to make moneys available to the board for investment.
(c) Each political subdivision of this state through its treasurer or equivalent financial officer may enter into agreements with the board state treasurer for the investment of moneys of the political subdivision with the board. Any political subdivision may enter into an agreement with any a state agency spending unit from which it receives funds to allow the funds to be transferred request transfer of the funds to their its investment account with the investment management board. Nothing herein shall preclude political subdivisions and their departments, boards, commissions and institutions, including, without limitation, the boards of trustees of policemen's pension and relief funds, the boards of trustees of firemen's pension and relief funds and volunteer fire departments, from investing in equities with the investment management board.
(d) Moneys held in the various funds and accounts administered by the board shall be invested as permitted by this article and subject to the restrictions contained in this article. For the consolidated fund, the treasurer shall maintain records of the deposits and withdrawals of each participant and the performance of the various funds and accounts. The board shall report the earnings on the various funds under management to the state treasurer at the times determined by the state treasurer. The board shall also establish rules for the administration of the various funds and accounts established by this section as it considers necessary for the administration of the funds and accounts, including, but not limited to: (1) The specification of amounts which may be deposited in any fund or account and minimum periods of time for which deposits will be retained; and (2) creation of reserves for losses: Provided, That in the event any moneys made available to the board may not lawfully be combined for investment or deposited in the consolidated fund established by this section, the board may create special accounts and may administer and invest those moneys in accordance with the restrictions specially applicable to those moneys.
CHAPTER 18. EDUCATION.

ARTICLE 30. WEST VIRGINIA COLLEGE PREPAID TUITION AND SAVINGS PROGRAM ACT.

§18-30-4. Creation of program; board; members; terms; compensation; proceedings generally.

(a) The West Virginia college prepaid tuition and savings program is hereby created continued. The program consists of a prepaid tuition plan and a savings plan.
(b) The board of trustees of the prepaid tuition trust fund in existence immediately prior to the effective date of this section shall become the board of the college prepaid tuition and savings program is continued and all powers, rights and responsibilities of the board of trustees of the prepaid tuition trust fund are transferred to vested in the board of the college prepaid tuition and savings program. With the exception of the members of the board appointed pursuant to the provisions of subdivision (3) of subsection (c) of this section, the members of the board of trustees of the prepaid tuition trust fund shall become the members of the board of the college prepaid tuition and savings program on the effective date of this section and shall, for all purposes, serve the same terms that they would have served had the board of trustees of the prepaid tuition trust fund continued.
(c) The board consists of nine members and includes the following:
(1) The secretary of education and the arts, or his or her designee;
(2) The state treasurer, or his or her designee;
(3) Two representatives of the higher education policy commission, who may or may not be members of the higher education policy commission, appointed by the commission who serve as voting members of the board, one of whom shall represent the interests of the universities of West Virginia and the state colleges and one of whom shall represent the interests of the state colleges and community and technical colleges of West Virginia; The members appointed pursuant to the provisions of this subdivision shall assume the positions heretofore held by the representatives of the university system board of trustees and the state college system board of directors in existence prior to July 1, 2000;
(4) Five other members, appointed by the governor, with knowledge, skill and experience in an academic, business or financial field, to be appointed as follows:
(A) A Two private citizen citizens not employed by, or an officer of, the state or any political subdivision of the state appointed from one or more nominees of the speaker of the House of Delegates;
(B) A private citizen not employed by, or an officer of, the state or any political subdivision of the state appointed from one or more nominees of the president of the Senate;
(C) One member representing the interests of private institutions of higher education located in this state appointed from one or more nominees of the West Virginia association of private colleges; and
(D) (C) Two members representing the public.
(d) The public members and the member representing the interests of private institutions of higher education are appointed by the governor with the advice and consent of the Senate.
(e) Only state residents are eligible for appointment to the board.
(f) Members appointed by the governor serve a term of five years and are eligible for reappointment at the expiration of their terms. In the event of a vacancy among appointed members, the governor shall appoint a person representing the same interests to fill the unexpired term. Of the initial appointments to the board of trustees of the prepaid tuition trust fund in existence immediately prior to the effective date of this section, the governor shall appoint one member to a one-year term, one member to a two-year term, one member to a three-year term, one member to a four-year term, and one member to a five-year term. Thereafter, all terms are five years.
(g) Members of the board serve until the later of the expiration of the term for which the member was appointed or the appointment of a successor. Members of the board serve without compensation. The treasurer may pay all expenses, including travel expenses, actually incurred by board members in the conduct of their official duties. Expense payments are made from the college prepaid tuition and savings program administrative account, and are made at the same rate paid to state employees.
(h) The treasurer may provide support staff and office space for the board.
(i) The treasurer is the chairman and presiding officer of the board, and may appoint the employees the board considers advisable or necessary. A majority of the members of the board constitute a quorum for the transaction of the business of the board.