Note #9176 from PCUSA NEWS to PRESBYNEWS:
06140 March 2, 2006
BOP grants apportionment of 3.6 percent for 2006
Board also approves 4 percent raise in disability benefits, elects officers
by Evan Silverstein
PHILADELPHIA - The directors of the Board of Pensions of the Presbyterian Church (U.S.A.) have approved a 3.6 percent increase in benefits for participants in the church's Pension Plan.
The 3.6 percent "experience apportionment" is a permanent increase in payments to retired church workers and their survivors and in pension credits for active members.
The increase, approved during a Feb. 25 meeting of BOP's directors, also applies to the accrued pension credits of disabled and vested and terminated Plan members. The increase goes into effect on July 1.
The board also approved a 4 percent raise in disability benefits as of Dec. 31, 2005.
"The experience apportionment is a lifetime commitment to Pension Plan members," Caroline DeEsposito, chair of the board's pension committee, told the BOP directors. "As we determine the size of the apportionment, we are making a commitment to Plan members that stretches 40, 50 years or more into the future."
DeEsposito said the board's objectives in determining an experience apportionment are to maintain the solvency of the Pension Plan; protect members' benefits from inflation; and achieve equity among members young and old, active and retired.
The 2006 increase in the experience apportionment follows a 3 percent increase in 2005 and a boost of 2 percent in 2004. In 2003 and 2002, there were no increases because the BOP's reserves were low after three years of negative returns.
This is the first time the increases have been determined through a new, two-stage methodology adopted by the board last October. The first stage involves deciding whether an apportionment may be granted, based on current market value and projected liabilities; the second stage is determining the size of the increase on the basis of a long-term perspective and best-estimate assumptions.
"The new policy will be an improvement over the prior approach, because it will provide more regular uniform annual apportionments while maintaining adequate funding of the plan," said Anna Hoover, vice president of retirement benefits.
In other business, the Board:
Changed the Retirement Housing Supplement Program guidelines to help retired church workers with housing expenses, increasing eligible monthly costs for individuals living independently from $800 to $1,000; for individuals living independently in retirement communities from $1,100 to $1,300: and for individuals in assisted living fom $3,000 to $3,200.
Approved changes to the Medical Plan to eliminate a fixed 20-visit limit for outpatient mental health services to conform to CIGNA Behavioral Health management practices for mental and substance abuse treatment; and updated the Medical Plan's dual-coverage provisions to reflect the guidelines adopted by the National Association of Insurance Commissioners.
Made several changes to the joint and survivor provisions of the Pension Plan to simplify coverage options available to a surviving spouse of an active Pension Plan member who dies before retirement benefits start; if the amendments are approved by the PC(USA)'s 217th General Assembly this summer, they will take effect on Jan. 1, 2007.
Renewed Intracorp's Smart Steps Disease Management Program for cardiac and diabetes patients for one year, starting July 1.
Elected as its chair the Rev. Jefferson Aiken Jr., pastor of First Presbyterian Church in Allentown, PA, who succeeds Earldean V.S. Robbins of San Francisco, CA; as first vice chair, Donald R. Fleischer of Wallingford, PA, who succeeds Aiken; and as second vice chair, Andrew Browne of Aurora, CO, who succeeds Ann C. Petersen of Chicago.
For more information about BOP programs and the recent changes, visit the board's Web site at www.pensions.org.
Information for this story was furnished by Jennifer Schoettle, the BOP's director of communications and public relations.
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Presbyterian Church (U.S.A.) 100 Witherspoon Street Louisville, KY 40202 (888) 728-7228