Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. The town meeting of the town of Needham may appropriate funds in order to offset the anticipated costs of premium payments for or direct payments to retired employees and the eligible surviving spouses or dependents of deceased employees. These funds shall be credited to a special fund to be known as the Post Retirement Insurance Liability Fund. Any interest or other income earned by the fund shall be added to and become part of the fund. The treasurer of the town shall be the custodian of the fund and may deposit the proceeds in national banks or invest the proceeds by deposit in savings banks, cooperative banks or trust companies organized under the laws of the commonwealth or in federal savings and loan associations situated in the commonwealth, or invest the same in such securities as are legal for the investment of funds of savings banks under the laws of the commonwealth. Amounts shall be appropriated to or expended from the fund by any town meeting by majority vote only in accordance with an actuarial schedule developed by the town. The schedule shall be designed to reduce to zero any unfunded liability attributable to the payment of such premiums or direct payments. The schedule shall also be designed to maintain appropriations as a fixed ratio of the current and predicted future payroll of the town. The treasurer may employ any qualified bank, trust company, corporation, firm or person for advice on the investment of the fund and to prepare an actuarial study and may pay for such advice and services from the fund.

SECTION 2. This act shall take effect upon its passage.