LAWRENCE COUNTY Investment losses from 2003 cost $300,000

The same investments made money in the past, a financial adviser says.
By LAURE CIOFFI
VINDICATOR NEW CASTLE BUREAU
NEW CASTLE, Pa. -- It wasn't a good year for Lawrence County investments in 2003.
County commissioners learned Wednesday that the county lost about $300,000 in the bond market.
They called in the county treasurer, controller and the company hired to manage investments Thursday to learn why there were losses.
Commissioners say they are still trying to get a true financial picture of county finances.
The investments losses, coupled with the fact that the county must repay a $7.7 million tax revenue anticipation note and $1 million to the county's mental health, mental retardation fund has commissioners concerned.
Commissioner Steve Craig has asked the controller and treasurer to tell them by July 15 how much money the county expects to collect the rest of the year and how much must be spent.
Commissioner Ed Fosnaught said he expects they will need more money than they expect to bring in, and commissioners will have to look for ways to cut expenses.
Commissioners have decided to take a conservative approach to investing and currently have no money in stocks or bonds. Treasurer Gary Felasco said all of the county's $11 million is now in interest-bearing checking accounts.
Commissioner Dan Vogler said he would rather have a guaranteed low return than experience a loss of county money in other investments.
Reason for loss
The investment loss discussed Thursday came as a result of investments made in 2003.
County auditors brought it to county commissioner's attention Wednesday. The loss includes about $50,000 lost from the county liquid fuels investments and $30,000 lost when officials pulled out bond investments earlier than expected to pay for improvements to Millennium Park, a proposed high technology park in Neshannock Township.
All of the money was invested by WRP Investments in the bond market.
David Dominick of WRP Investments, a Youngstown-based company, said after dividends and interest were paid the county's overall loss was $128,742.
"The loss is on $8.25 million. That's about 1 percent," he noted. Dominick said most of the money was invested in Government National Mortgage Association funds which saw a loss because of the large number of loan refinances last year.
Dominick noted that the same investments have made money for the county in the previous three or four years.
Rob Lent of Maher Duessel, a Pittsburgh auditing firm performing the county's annual audit, said the county must make prudent investments with taxpayer money under the county code.
Felasco noted that nobody questioned these investments -- including the auditors in the last few years -- when they were earning money.
Termed prudent
David Pintaric, president of WRP Investments, said he believes the investments were prudent under county law.
"These were appropriate and worked for three or four years, but people are focusing on a short period of time. If you take the last four years, these investments have worked very well," he said.
Dominick added that if the county looks at its overall investments over the past four years, it probably earned $1 million.
cioffi@vindy.com