Committee accepts Q2 2025 investment performance report; approves Allspring share‑class swap

The St. Mary’s County 457(b) governance committee on Sept. 25 accepted Marquette Associates’ second‑quarter 2025 investment performance report and approved a share‑class change that reduces expenses for one plan option.

Patrick Wing of Marquette Associates presented market and manager performance context for Q2 2025 and reviewed plan allocations and active manager results. After the presentation the committee voted to accept the report and approved a recommendation to swap the Allspring Special Mid Cap Value holding from the administrator share class to a lower‑cost institutional share class.

Why it matters: the performance report explains how market returns and manager positioning affected participant investments in the 457(b) plan. The share‑class change reduces the expense ratio for one active option, lowering costs for plan participants without changing the manager or holdings.

Marquette’s presentation summarized Q2 market returns — double‑digit gains in major equity regions and modest returns for investment‑grade bonds — and explained how the quarter’s strong growth‑and‑AI driven returns advantaged certain benchmarks and disadvantaged many active small‑ and mid‑cap value managers that underweight speculative growth names. Marquette noted target‑date funds in the plan performed well across most vintages, with the earlier vintages (2010 and 2015) slightly behind their benchmarks because of a value tilt.

Committee discussion touched on asset allocation, the small percentage of plan assets in active equity managers (about 9 percent), and how relative performance of small and mid‑cap managers could affect watch‑list considerations if underperformance continues. Patrick Wing said most target‑date vintages remain in top performance percentiles over longer time horizons and recommended monitoring certain active managers if the recent pattern persists for another quarter.

The committee voted to accept the Marquette Associates report by voice vote. Dylan Payne, the committee’s employee member, moved to accept the report; a member seconded and the chair recorded the motion as carried.

On a separate motion the committee approved switching the Allspring Special Mid Cap Value holding to an institutional share class with a lower expense ratio (reported as roughly 80 basis points versus the previous ~1.05 percent administrator share class). The committee’s report author and county staff said the swap retains the same fund manager, holdings and strategy and is intended to lower costs for participants; trustees approved the change by voice vote.

The administrator’s report noted one vendor payment of $4,500 to Marquette Associates for investment consulting services covering April 1–June 30, 2025, and listed the governance committee’s next scheduled meeting on Dec. 4, 2025. The committee also approved its 2026 meeting calendar.

All committee motions described above were approved by voice vote during the Sept. 25 meeting.