Early indications show a change in investment strategies may be paying off for the Butler County Employee's Retirement Fund.

At the beginning of this year, the county, on advice of its new pension fund monitoring firm, switched from a mix of passive-active investment managers to all active managers.

Passive managers buy investments across the boards from the stock market, while active managers pick and recommend investments.

Because active managers cost more money, the pension fund's investment manager expenses jumped from $100,000 to $400,000 this year.

Since the $100,000 was originally budgeted for this position, county commissioners last week used an extra $300,000 from the pension's contingency fund to cover the increased cost.

This extra spending on active investment managers appears to be paying off, said county Controller John "Jack" McMillin, who is on the retirement board.

The county's pension fund went from $70 million at the end of 2003 to $73 million at the end of June.

However, McMillin said investment changes should not be judged until they have been in place for at least a year.

"Stay tuned," he said.

County Treasurer Diane Marburger is cautiously optimistic about the change: "It really is just too early to tell. You can not judge a money manager on two quarters."

Since the switch, the pension fund has been receiving a 2.4 percent rate of return on its investments, McMillin said.

The fund's rate of return bottomed out in 2002 at negative 5 percent, when the county was heavy on passive managers.

It peaked back in 1995 at 23 percent return, when the county had active mangers.

During those same years, the county's contribution to the pension fund bounced from no money in 1999 through 2001 to this year's peak $1.9 million contribution.

About 50 percent of the county's contribution this year will be reimbursed through state funded programs, McMillin said.

The switch to all active managers was preceded by a June 2003 decision to change investment fund monitors.

The monitor helps the county plan its investment strategy and oversees and evaluates the performance of its money managers.

County officials have said they hired Yanni Partners of Pittsburgh because the company has no brokerage affiliation.

Prior to Yanni's hire, the county had operated for about six months without a monitor as officials searched to replace Legg Mason Wood Walker of Baltimore.

Currently, the pension fund has 749 active county employee members and 305 retirees.

This year it has been paying out an average of $178,000 a month.

Comparatively in 1997, the county paid out an average of $101,000 a month to 266 retirees, and 647 county employees were paying in.