The ELCA leaders probably vote Democratic 99%.
ELCA NEWS SERVICE
January 14, 2011
ELCA, Board of Pensions Respond to Lawsuit on Annuity Payment Reductions
CHICAGO (ELCA) -- The churchwide organization of the Evangelical Lutheran Church in America (ELCA) and the ELCA Board of Pensions responded publicly to a Dec. 3 lawsuit filed against them in a Minnesota state court by four plaintiffs. The plaintiffs claim the ELCA Board of Pensions acted improperly to reduce annuity payments to retirees participating in an annuity retirement fund.
The suit was filed in a district court in Hennepin County, Minn., by the Rev. Arthur F. Haimerl, the Rev. Benjamin A. Johnson and two former pastors, Larry D. Cartford and Dr. Ronald A. Lundeen.
Named as defendants were the ELCA Board of Pensions, based in Minneapolis, and two members of its leadership team, John G. Kapanke, president and chief executive officer, and Curtis G. Fee, vice president and chief investment officer. The ELCA, a separate nonprofit corporation based here, was also named.
"The Evangelical Lutheran Church in America is aware of the allegations contained in the lawsuit filed in the Minnesota District Court," according to a statement from the ELCA churchwide organization. "The lawsuit claims that the ELCA Board of Pensions, a corporation separate from the churchwide organization, acted improperly by reducing certain annuity payments. We are disappointed the plaintiffs chose to name the ELCA as a defendant in this matter. While we deny the allegations, we will not comment publicly on the specifics contained in the lawsuit so long as this matter is in litigation."
"The ELCA remains concerned about the retirees who filed the lawsuit as we are about everyone adversely affected by the downturn in the stock market and the state of the economy. We ask everyone to keep the retirees and the church in their prayers during these difficult times," the statement said.
In 2009 the ELCA Board of Pensions informed about 12,500 retirees in the Participating Annuity and Bridge Fund that, because of significant market losses, their annuity payments would be reduced 9 percent for 2010, and would likely be reduced further by 9 percent in 2011 and 2012.
The reductions were needed because the Participating Annuity and Bridge Fund suffered significant market losses in late 2008 and early 2009, resulting in a funding shortfall of as much as 39 percent in February 2009. To ease the impact on plan members, the trustees decided to implement reductions over a three-year period.
Last month the trustees of the Board of Pensions announced smaller 2011 reductions in annuity payments for plan members in its Participating Annuity and Bridge Fund, primarily because of positive market performance in recent months. The trustees reduced annuity payments for 2011 by 6 percent instead of 9 percent for plan members in the Participating Annuity and Bridge Fund.
In the lawsuit the plaintiffs alleged that the defendants' actions were not proper and not permitted based on the terms of the retirement plan agreement. The plaintiffs claimed that "annuity payments were guaranteed for life" and that "increases in these guaranteed lifetime annuity payments would be permanent."
Earlier this month the Board of Pensions caused the lawsuit to be moved to the federal court in Minneapolis.
"We believe this lawsuit, brought by four individuals, lacks merit and we are vigorously defending against it," said a statement from the ELCA Board of Pensions. "The top priority of the Board of Pensions for the ELCA Participating Annuity and Bridge Fund has always been, and continues to be, providing annuity payments to participating plan members during their lifetimes.
"In January 2010, as a result of the historic and virtually unprecedented downturn in the investment markets in late 2008 and 2009, the Board of Pensions implemented a three-year plan of corrective measures to protect the long-term viability of the Fund for its participating plan members. The Board of Pensions believes it has acted in the best interests of plan members by seeking to return the Fund to fully funded status. The steps implemented by the Board of Pensions are intended to support continued annuity payments to participating plan members during their lifetimes. Currently we are on track to return the Fund to a fully funded status, due primarily to improved investment market performance and the action we have taken in our stewardship of the Fund," the Board of Pensions statement said.
For information contact:
John Brooks, Director (773) 380-2958 or news@elca.org
6 comments:
What do you expect from the commercialization of the Word of God?
It is exactly what I expect.
ELCA=Democrat; LCMS=Republican. ELCA+LCMS=Corporate Church.
Not only is the ELCA facing this, but most state employee pensions, as well as most teacher pensions, are confronting a similar problem.
The problem is also bad in the traditional smoke stack industries like autos.
People have to understand that a signed contract cannot negate the laws of mathematics.
If people actually received yearly statements that showed the relative performance of the financial instruments backing their pensions rather than just receiving a statement indicating how much their respective contract says they should get, people would be much more realistic in their retirement planning.
It's like when a church council passing some resolution, people assume that that is all there is to it. Hey, we passed resolution whatever, so that means it MUST be done.
The resolution is passed, but contributions do not increase nor do people show up to physically lend a hand towards its accomplishment.
I think the WELS and other Synods will be facing a lot of retired baby-boomers who have not planned for retirement and may be looking to their congregations for assistance to pay housing and medical bills.
Many clergy and teachers have been robbed blind while the leaders have feathered their nests. Ask about the WELS "consultants" who bill congregations thousands of dollars on top of their established salaries, or Cornerstone's exorbitant money-raising fees.
Cornerstone is WELS/LCMS and supposedly independent, but they use their synodical connections to direct business their way.
Post-65 will be a bummer for many Boomers, unless they work until departing this mortal coil. That is not all bad. Work helps people live longer and more happily.
I would rather wear out than rust out.
All these recurring pension plan reductions year after year brings up the question of how the Schwan Foundation, which funds a significant portion of the WELS budget, can maintain the same funding level as the year before. They told the WELS to cut their budget by "x" amount over a year ago, but I keep on waiting for the second shoe to drop. When will they tell the WELS to cut their budget by "y" amount? Or are their investments so good that their returns are the same as last year?
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