HOLLIDAYSBURG - The Blair County Retirement Board, which manages the employee pension plan, is making some investment changes that will reduce the plan's fees by almost $100,000 and make it easier to gauge performance.
By working with Peirce Park Group representative Michael Shone, the county retirement board agreed Monday to invest 65 percent of the county's pension dollars in equity funds offered by Vanguard, Thornburg, MFS and American investment groups and to invest 35 percent of the pension dollars in fixed income funds offered through FNB Investment Services or Wilmington Trust, which is part of the M&T Bank Corp.
The decision brings an end to several years of dividing the county's pension dollars among FNB, M&T and the Neuberger Berman investment firm. At the end of June, they collectively held $36.9 million in Blair County pension dollars.
The most convincing argument for making the change is that the county will save almost $100,000 in investment management fees, Richard J. Peo, county controller and retirement board secretary, said after Monday's meeting.
But another reason to change practices, Peo said, involves the use of one custodial account manager to compile comparable data on how these funds are performing.
"We'll only have one place to look for that," Peo said.
Shone compiled information for the retirement board showing that of the three firms managing the county's pension funds, Neuberger Berman achieved the highest return in the past year but also at the highest expense, based on its fees.
To address that, Shone provided the retirement board with several options. Chairman Terry Tomassetti suggested using one that included Vanguard funds, based on low fees, and the Thornburg group, based on a history of high returns when the stock market is up and minimal losses when the stock market is down. The retirement board members agreed.
Shone suggested moving forward with making the investment changes as soon as a custodial account manager is identified for the pension funds. That could occur at 10 a.m. Monday, when the board expects to reconvene to review additional information.
Shone also recommended the retirement board retain the use of ConvergEx Execution Solutions to handle the pension fund transfers. The county has used the company before, and it's proposing a new contract with a transaction fee of 1 cent per share which Shone described as very favorable. The retirement board approved the recommendation.
Mirror Staff Writer Kay Stephens is at 946-7456.