In June, rebels on the board of Pennsylvania’s biggest pension fund fell two votes short in an attempt to oust top executives over the investment strategy for the $70 billion plan.

But this week, for the first time, dissidents mustered a board majority in a public vote to stop more than $300 million in new investments backed by the fund’s chief investment officer, James H. Grossman Jr., and his big team of staff and consultants.

The 8-7 vote Wednesday to freeze action on the staff’s Wall Street picks followed bitter debate. It showed power shifting to the self-styled reformers on the deeply divided board of PSERS, the Public School Employees’ Retirement System. The taxpayer-supported fund sends out $6 billion yearly in pension checks to 250,000 retired teachers and other former school workers.

This time, two state legislators, Reps. Frank Ryan (R., Lebanon) and Matt Bradford (D., Chester), joined the rebels in blocking even a vote on the staff’s latest picks. In contrast, both in June had rejected the bid to fire Grossman and executive director Glen Grell.

Still, the depth of the division and the close vote suggests the war is far from over in the struggle over precisely what PSERS must do to boost its lackluster returns. The dissidents want to jettison the high-fee and targeted investment strategies backed by Grossman in favor of publicly traded stocks or index funds that they say will perform at least as well at far lower cost.

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In the sharpest exchange, board member Sue Lemmo, an art teacher from Western Pennsylvania, warned the dissidents that the board could even face a lawsuit for a “breach of fiduciary duty” for putting political interests ahead of members’ — a charge that outraged the rebels.

“I don’t appreciate the perspective” that board members who don’t endorse staff proposals are somehow failing in their duty, shot back Ryan, a retired Marine Corps officer and CPA.

State Sen. Katie Muth (D., Montgomery), the board’s most outspoken critic of PSERS management, declared that the real fiduciary failing would be to routinely approve Wall Street investment pitches. She is suing PSERS to obtain copies of secret contracts with investment managers.

Nathan Mains, chief executive of the state’s association for school boards, voted with the dissidents. He was dismayed by the acrimony.

“I’ve been on this board eight years, and this may be a low point,” Mains told his colleagues.

The board has been under strain in recent years as fund profits have trailed other states despite its innovative global investment program.

Critics on the panel, led initially by Ryan and former state Treasurer Joe Torsella, began questioning the fund’s unusually heavy investments in private-equity buyouts and other “alternative” investments. They say the shift to those sophisticated but often disappointing investments and away from record-setting U.S. stocks, explains why the fund’s profits have lagged behind similar plans.

Tensions grew this spring after news broke that PSERS was facing a federal criminal investigation into the board’s adoption last year of a botched calculation of investment returns and its spending on Harrisburg properties.

On Wednesday, Grossman, who heads a well-paid staff of 50 investment experts, proposed investing $100 million into LEM Multifamily Fund VI, a fund that finances apartments and was founded by Ira Lubert, a Philadelphia real estate owner and casino developer. Lubert has been selling investments to PSERS for 20 years.

Staff also recommended that PSERS invest about $235 million into ICG Europe Fund VIII, set up by a European investment company that has also sold previous funds to PSERS.

But before the staff could say a word Wednesday, the dissident bloc demanded and won the vote to knock the proposals off the agenda.

Along with the two state legislators, those voting against Grossman’s agenda included the six who pushed for the firing of the PSERS executives in June — Muth, Mains, Torsella, state Treasurer Stacy Garrity, Gov. Wolf’s banking secretary Richard Vague, and state education secretary Noe Ortega. In some cases, aides cast votes in place of the members.

On the losing side were management’s most loyal defenders: all five board members who belong to the state’s dominant union for teachers, the Pennsylvania State Education Association; as well as State Sen. Pat Browne (R., Lehigh) and Eric DiTullio, another representative of school boards.

At the meeting, the loyalists vigorously opposed any delays in the new investments.

“Don’t. This will harm the pension,” warned board member Jason Davis, a high school teacher in Western Pennsylvania. “Listen to our paid experts.”

Veteran trustee Melva Vogler accused fellow trustees of “hurting” pensioners.

Lemmo accused opponents of getting their ideas “from newspaper articles.”

But Ryan recoiled from the the criticism. “Good people,” he said, “can have different opinions.”