HARRISBURG — Lacking a board majority, six dissident members of the PSERS pension fund backed away Friday from their push to fire the plan’s top two leaders. But they helped derail a proposal to pump another $1 billion into so-called alternative investments — the kind of investment the critics say has generated only high fees and lackluster results.

In a rare public boardroom rebellion involving a big public retirement fund, the six trustees had issued a public letter Thursday urging the 15-member board to vote the next day to oust executive director Glen Grell, and investments chief James H. Grossman Jr. By late Friday afternoon, however, they were two votes short of a majority and decided not to contest the matter before the board of the giant $64 billion pension plan for 265,000 retired public school teaches and other former school staff.

“We had six” votes, state Treasurer Stacy Garrity, a leader among those seeking the firing, said after the meeting. “We thought we had some more on our side, but in the end we did not.”

Grell and Grossman were in the boardroom here for the Friday meeting but neither said a public word all day about the move to fire them. They declined comment to a reporter.

Garrity and State Sen. Katie Muth (D., Montgomery), another critic of the fund’s management, said the challenge to the leadership would continue.

“Whether you take it from the performance perspective...or from the perspective of transparency and accountability, there are problems that have not been solved,” Muth said.

The dissident bloc said the men needed to be fired because of the plan’s relatively poor financial returns. The critics also say the plan’s management has run roughshod over the board.

The detractors made their move to fire the men as federal prosecutors and the FBI have been conducting a criminal investigation of the fund. But the dissenters said their effort was unrelated to the probe and was mainly about the investment strategies pursued by Grell, Grossman and his highly paid 50-member investment unit.

The critics favor a stripped down emphasis on U.S. stocks and bonds, an approach akin to the index funds pioneered by Vanguard. They denounce the agency’s current mix as too complicated, too illiquid, and too opaque with far too many billions invested in high-fee hedge funds, venture capital projects, startup and other financial instruments not sold on public markets.

In their letter seeking the firing, they cited the $1.2 billion in investments scheduled for a vote Friday as fresh examples of the staff continuing its wrongheaded approach. After the board discussed the investments Friday behind closed doors, the board approved only one of six such spending proposals — the one for the least money, $40 million for Capstone Investment Advisors— and the rest were pulled from the agenda. Two board sources said backers of the investments backed off once it was clear they would be rejected.

After wrapping up the investment debate, the board, very briefly, took up the main event — the issue of firing Grell and Grossman in a public session.

Board chairman Christopher Santa Maria, a high school social studies teacher in Lower Merion, delivered the outcome cryptically. He told the panel only: “We had a personnel matter. Those members have asked to withdraw their request. The item has been removed.”

At that point, Muth put the board on notice that the matter was still unresolved. “The leadership discussion needs to be implemented in a very aggressive manner,” she said.

In response, board member Frank X. Ryan, a Republican State House member from Lebanon County, said he regretted that the move to dismiss the men had spilled into public view.

Along with Garrity and Muth, the others signers of the letter were Joe Torsella, Garrity’s predecessor as treasurer; state banking secretary Richard Vague; acting education secretary Noe Ortega; and Nathan G. Mains, the leader of the state School Boards Association. None spoke during the brief discussion over the executives’ fate.

Among those who refrained from supporting the ouster were Santa Maria and Ryan. Notably the board trustees backing management included five working or retired educators who belong to the dominant union for teachers in the state, the Pennsylvania State Education Association.

Supporters of the current portfolio say its diversity is a strength, not a weakness. They say the money invested in venture capital and the like has the potential to pay off big for the plan.

At one point on Thursday, Grossman said one of his bets had just hit the jackpot — on paper, at least. An $85 million PSERS investment, Grossman said, in a California maker of high-fashion nurses’ uniforms was worth $329 million now that the start-up had sold its shares to the public. Grossman, though, acknowledged that PSERS, as an insider, could not sell its shares and cash in the winnings until November, at the earliest.

PSERS — the Public Employees’ Retirement System — is among the top 25 pension plans in the United States. Financed by taxpayers, working teachers and its investment profits, the fund sends $6 billion in retirement payments yearly to 265,000 former public school educators. Retirees haven’t had a cost-of-living increase in 18 years.

The system has been reeling since news broke in the spring that the FBI had launched a grand jury investigation into the fund. Subpoenas, obtained by Spotlight PA and the Inquirer, shows that that the probe is focusing on two seemingly disparate matters: the fund’s $10 million expenditure to buy and clear Harrisburg real estate near its offices and its fateful misstatement of its financial performance last year.

Last December, the board approved a figure for investments profits just high enough to avoid a penalty under state law that requires working teachers to pay more into the plan when its return fell under certain targets. It did so even though leading board dissident Joe Torsella, then state treasurer, warned that the management’s math was suspect.

In April, the panel reversed course. It disavowed the earlier number, and adopted a new, lower one. The turnabout triggered the state law — meaning that 110,000 teachers will see a bigger pension bite out of their paychecks on July 1.

The critics says Grossman, a 24-year PSERS employee paid $485,000 yearly, the most in state government, and his 50-member investment team have put together a mindbogglingly complex investment portfolio that puts far too much money into private-equity firms, hedge funds, venture-capital projects and start-ups. They say this kind of investment is hard to value and get your money out and comes with excessive fees

PSERS got some good news on Friday afternoon although it’s unlikely to convert its critics.

Thanks to large and rising contributions from taxpayers and the recovery of investment values, “we are on track to show record asset growth,” said PSERS chief financial officer Brian Carl, with assets reaching $66 billion, the highest since 2007, before the Great Recession.

Of course that is in constant dollars, and doesn’t count the lost purchasing power from inflation. And the pension obligations are much higher today than in 2007. Thus there remains the $40 billion plus gap between assets and liabilities.

Still, some saw progress. “These [big gains] don’t come along very quickly,” Carl added, noting PSERS could finally return to where it was in 2007 by the end of June, if market gains continue.

”It feels good to be back where we were so many years ago,” said trustee Melva Vogler, a retired teacher from the Poconos.