(a) Except as provided by Subsection (b), the board of directors of a river authority may determine and designate the amount of money to be invested in a hedging transaction.
(b) The board of directors of the river authority by formal policy shall regulate the investment of money in hedging contracts. An investment may be made only for hedging purposes. The policy must provide restrictions and procedures for making an investment that a person of ordinary prudence, discretion, and intelligence, exercising the judgment and care under the circumstances then prevailing, would follow in the management of the person’s own affairs, not in regard to speculation but in regard to the permanent disposition of the person’s money, considering:
(1) the probable income; and
(2) the probable safety of the person’s capital.