2010 Pennsylvania Code
Title 15 - CORPORATIONS AND UNINCORPORATED ASSOCIATIONS
Chapter 55 - Corporate Powers, Duties and Safeguards
5548 - Investment of trust funds.

     § 5548.  Investment of trust funds.
        (a)  General rule.--Unless otherwise specifically directed in
     the trust instrument, the board of directors or other body of a
     nonprofit corporation incorporated for charitable purposes shall
     have power to invest any assets vested in the corporation by
     such instrument or the proceeds thereof separately or together
     with other assets of the corporation, in the manner authorized
     for fiduciaries by 20 Pa.C.S. Ch. 72 (relating to prudent
     investor rule), and to retain any investments heretofore so
     made. Any such nonprofit corporation may, by appropriate action
     of its board of directors or other body, keep any investments or
     fractional interests in any investments, held by it or made by
     it, in the name of the corporation or in the name of a nominee
     of the corporation.
        (b)  Use and management.--Except as otherwise permitted under
     20 Pa.C.S. Ch. 61 (relating to estates), the board of directors
     or other body shall apply all assets thus received to the
     purposes specified in the trust instrument. The directors or
     other body shall keep accurate accounts of all trust funds,
     separate and apart from the accounts of other assets of the
     corporation.
        (c)  Determination of income.--
            (1)  Unless otherwise specifically directed in the trust
        instrument, the board of directors or other body may elect to
        be governed by this subsection with respect to assets thus
        received, including any participation in any common trust
        fund.
            (2)  To make an election under this subsection, the board
        of directors or other body shall adopt and follow an
        investment policy seeking a total return for the assets held
        by the corporation or in the name of a nominee of the
        corporation or by an institutional trustee pursuant to
        section 5549 (relating to transfer of trust or other assets
        to institutional trustee), whether the return is to be
        derived from capital appreciation, earnings or distributions
        with respect to the capital or both. The policy constituting
        the election shall be in writing, shall be maintained as part
        of the permanent records of the corporation and shall recite
        that it constitutes an election to be governed by this
        subsection.
            (3)  If an election is made to be governed by this
        subsection, the term "income" shall mean a percentage of the
        value of the assets so held by or for the corporation. The
        board of directors or other body shall in a writing
        maintained as part of the permanent records of the
        corporation annually select a percentage and determine that
        it is consistent with the long-term preservation of the real
        value of the assets, but in no event shall the percentage be
        less than 2% nor more than 7% per year.
            (4)  The board of directors or other body may revoke an
        election to be governed by this subsection if the revocation
        is made as part of an alternative investment policy seeking
        the long-term preservation of the real value of the assets
        thus received. The revocation and alternative investment
        policy shall be in writing and maintained as part of the
        permanent records of the corporation.
            (5)  For purposes of applying this subsection, the value
        of the assets of the corporation shall be the fair market
        value of the assets so held by or for the corporation,
        determined at least annually and averaged over a period of
        three or more preceding years. However, if the assets have
        been held for less than three years, the average shall be
        determined over the period during which the assets have been
        held.
        (d)  Scope of section.--This section shall apply to assets
     hereafter received pursuant to section 5547 (relating to
     authority to take and hold trust property), to assets heretofore
     so received and held at the time when this article takes effect
     and to reinvestments of all such assets.
        (e)  Definition.--(Deleted by amendment).
     (Dec. 21, 1988, P.L.1444, No.177, eff. Oct. 1, 1989; Dec. 21,
     1998, P.L.1067, No.141, eff. imd.; June 25, 1999, P.L.212,
     No.28, eff. 6 months)

        1999 Amendment.  Act 28 amended subsec. (a).
        1998 Amendment.  Act 141 amended subsecs. (b) and (c) and
     deleted subsec. (e). Section 4 of Act 141 provided that the
     amendment of subsecs. (b), (c) and (e) shall apply to all
     trusts, whether created before, on or after the effective date
     of Act 141.
        1988 Amendment.  Act 177 amended subsec. (d).
        Cross References.  Section 5548 is referred to in sections
     5549, 5585 of this title.