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Dunmore pension fund posts strong 2024 returns, adviser says
Summary
At the Sept. 10 meeting, advisor Ralph Colo reported a year-to-date net return of 8.74% and roughly $1.5 million in gains for 2024; portfolio income totaled $530,280 (about a 3% net yield), cash is 12.7% of assets earning north of 5%, and the board was told new MMO figures from actuary Joe Duda will apply in January 2025.
Ralph Colo presented the Pension Board with an investment update at the Sept. 10 Dunmore meeting, reporting year‑to‑date net returns of 8.74% and roughly $1.5 million in calendar‑year 2024 gains for the borough's pension portfolios.
Colo said the portfolio allocation is a little over 50% in equities and about 12.7% in cash. "Right now we're earning north of 5 percent on our cash with zero risk," he said, adding that the board currently earns income from bonds and dividend‑paying stocks. Colo pointed the board to cumulative income figures (not investment price returns): "that figure as you could see right now is at $530,280, you know, for a net yield of almost 3 percent." He reported a 12‑month net return of about 13.77%, representing approximately $2.2 million in gains, and noted withdrawals of about $300,000 to pay retirees during the period.
Board members asked clarifying questions about account structure. When Janet Brier asked, "Ralph, does that include what we contributed?" Colo initially said, "It does. It does, yes," then clarified that the investment earnings figure does not include contributions and that the $530,280 figure refers to income generated by the portfolio holdings. Board member Greg Kamla asked which of the three accounts on the report corresponded to Fire, Police and Non‑Uniform funds; Colo said the first is Fire, the second Police and the third Non‑Uniform, and that all three are managed with the same discipline.
Colo also referenced a nonpartisan Morgan Stanley piece about sector performance around elections and said the advisor will continue to manage the portfolios prudently regardless of political outcomes. Members discussed timing and payment of the Minimum Municipal Obligation (MMO); Mark Burton said he received the new MMO figures late Friday and will forward them, and Durkin and others noted the MMO numbers will be applied as of January 2025. Durkin warned that failing to pay MMO obligations can trigger expensive compound interest from Jan. 1 at the plan's assumed rate.
The board did not take formal investment actions at the meeting but will continue to monitor allocations and the MMO schedule.
