1. (a) The board shall establish alternative investment programs within the fund, based on the following requirements:

   1. (1) The board shall maintain at least one (1) alternative investment program that is an indexed stock fund, one (1) alternative investment program that is a bond fund, and one (1) alternative investment program that is a stable value fund. The board may maintain one (1) or more alternative investment programs that:

      1. (A) invest in one (1) or more commingled or pooled funds that consist in part or entirely of mortgages that qualify as five star mortgages under the program established by IC 24-5-23.6 ; or
      2. (B) otherwise invest in mortgages that qualify as five star mortgages under the program established by IC 24-5-23.6 .
   2. (2) The programs should represent a variety of investment objectives.
   3. (3) The programs may not permit a member to withdraw money from the member's account, except as provided in section 6 of this chapter.
   4. (4) All administrative costs of each alternative program shall be paid from the earnings on that program.

   5. (5) A valuation of each member's account must be completed as of:

      1. (A) the last day of each quarter; or
      2. (B) a time that the board may specify by rule.

2. (b) A member shall direct the allocation of the amount credited to the member among the available alternative investment funds, subject to the following conditions:

   1. (1) A member may make a selection or change an existing selection under rules established by the board. The board shall allow a member to make a selection or change any existing selection at least once each quarter.
   2. (2) The board shall implement the member's selection beginning on the first day of the next calendar quarter that begins at least thirty (30) days after the selection is received by the board or on an alternate date established by the rules of the board. This date is the effective date of the member's selection.
   3. (3) A member may select any combination of the available investment funds, in ten percent (10%) increments or smaller increments that may be established by the rules of the board.
   4. (4) A member's selection remains in effect until a new selection is made.
   5. (5) On the effective date of a member's selection, the board shall reallocate the member's existing balance or balances in accordance with the member's direction, based on the market value on the effective date.
   6. (6) If a member does not make an investment selection of the alternative investment programs, the member's account shall be invested in the board's general investment fund.
   7. (7) All contributions to the member's account shall be allocated as of the last day of the quarter in which the contributions are received or at an alternate time established by the rules of the board in accordance with the member's most recent effective direction. The board shall not reallocate the member's account at any other time.
3. (c) When a member transfers the amount credited to the member from one (1) alternative investment program to another alternative investment program, the amount credited to the member shall be valued at the market value of the member's investment, as of the day before the effective date of the member's selection or at an alternate time established by the rules of the board. When a member retires, becomes disabled, dies, or withdraws from the fund, the amount credited to the member shall be the market value of the member's investment as of the last day of the quarter preceding the member's distribution or annuitization at retirement, disability, death, or withdrawal, plus contributions received after that date or at an alternate time established by the rules of the board.

4. (d) The board shall determine the value of each alternative program in the defined contribution fund, as of the last day of each calendar quarter, as follows:

   1. (1) The market value shall exclude the employer contributions and employee contributions received during the quarter ending on the current allocation date.
   2. (2) The market value as of the immediately preceding quarter end date shall include the employer contributions and employee contributions received during that preceding quarter.
   3. (3) The market value as of the immediately preceding quarter end date shall exclude benefits paid from the fund during the quarter ending on the current quarter end date.

As added by P.L.6-1989, SEC.1. Amended by P.L.205-1999, SEC.4; P.L.195-1999, SEC.3; P.L.118-2000, SEC.1; P.L.13-2001, SEC.4; P.L.30-2009, SEC.1; P.L.165-2009, SEC.1; P.L.1-2010, SEC.1; P.L.115-2010, SEC.1; P.L.35-2012, SEC.8.