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Article published March 3, 2010
Retirement panel aims to protect fund
Butler County's pension fund rose to more than $104 million at the end of 2009. After dropping to about $73 million two years ago, the fund has steadily grown. It totaled $84.5 million in December 2008. County Controller Jack McMillin said in an interview Thursday the latest numbers are a good sign for the fund. "We're delighted about that," he said. The majority of the pension fund is in investments. McMillin said the 20.2 percent return on those investments over the one-year period ending Dec. 31 was above the 19.7 percent benchmark, which is a national average of comparable pension funds. "We did OK," he said. "We didn't hit any grand slams." McMillin said the county retirement board, which is comprised of the three commissioners, controller and treasurer, now has to answer a question: How do we protect our winnings? County Treasurer Diane Marburger agreed the goal is to preserve what the county has. "We do not want to sustain another hit like we did in 2008," she said. Marburger said the county will look at ways to diversify the pension fund. "Diversification is the key," she said. "You don't want to have all your eggs in one basket, as the old saying goes." Common stock comprised $45.5 million of the total fund, government and agency obligations totaled $22.9 million, corporate bonds totaled $20.7 million, international stock was $10.6 million and the remaining $4.8 million was in cash and cash equivalents. In addition to the 379 county retirees and beneficiaries receiving benefits, another 44 people have vested pensions with the county but have deferred payments until later. A former employee is entitled to a county pension after that person had five years of employment, is 60 years old and left his money vested with the county. The county has 769 active plan members who contribute to the pension plan. The retirement board Thursday directed consultant Raulin of Bridgeville to compile a list of potential candidates to replace money manager Gardner Lewis. McMillin said Gardner Lewis Asset Management of Delaware County, which handles large capital growth investments, has been underperforming for three years ending Dec. 31, 2009. The total amount of county investments Gardner Lewis oversees is $15.4 million, a significant drop from the $18.5 million total three years earlier. "That $3 million loss is nearly triple that of the average asset manager in that category," McMillin said. The $15.4 million is more than $2 million lower than the national average for capital growth investment managers. "They have not bounced back like they should have" Marburger said about Gardner Lewis. Large capital growth investments are with newer companies as compared to older, established ones. Gardner Lewis will remain the manager of large capital growth investments until a replacement is found. The retirement board will have to vote for a switch before another firm officially replaces Gardner Lewis, which is one of four financial managers handlings five classes of assets.
