Westmoreland pension fund hits record value of more than $500M

Westmoreland County’s pension fund exceeded $500 million for the first time, officials announced Wednesday.

The fund, which pays benefits to more than 1,300 retired county workers, was valued at $521 million at the end of December, finishing a roller coaster year that saw the account lose about $68 million through March then dramatically rebound over the final three quarters of 2020.

After starting the year with $472 million in the bank, the retirement account took a sharp downward turn as the economy plunged early in the coronavirus pandemic. The fund’s value dipped to $404 million after the first three months of the year.

It earned back all of its losses over the next eight months and reached its highest level by year’s end.

Overall, investments generated a 14% return for the county last year and doubled the fund’s annual average increases, according to county Controller Jeffrey Balzer.

“The more success we have with the pension fund, the less burden it is on the taxpayers,” Balzer said.

Since 2008, the pension fund has more than doubled in value, Balzer said.

The county has a team of 21 private money managers hired to invest pension fund assets.

Meanwhile, the county last year paid more than $12 million into the pension fund to match employee contributions and to ensure the account is able to meet all future obligations.

Officials originally anticipated another $14 million would have to be diverted from the county’s general fund this year to keep the retirement account adequately funded, but commissioners as part of the 2021 budget incorporated a cost-savings plan that is expected to create an immediate $3.5 million savings in pension spending.

That plan calls for borrowing $140 million against pension fund assets. That money will be used to make the county’s pension fund payments over the next two decades.

The county’s retirement board, which includes all three county commissioners, Balzer and Treasurer Jared Squires, in December voted to give pensioners a 0.94% cost-of-living raise in 2021. Pensioners received 1.94% raises in 2020.