wfn.org | ELCA Pensions Trustees Hike Budget, Discuss Equity

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ELCA NEWS SERVICE

November 26, 2001

ELCA PENSIONS TRUSTEES HIKE BUDGET, DISCUSS EQUITY
01-302-SS*

     MINNEAPOLIS (ELCA) -- Trustees of the Evangelical Lutheran Church
in America (ELCA) Board of Pensions approved a $54.2 million budget for
2002 -- an increase of 11.5 percent over 2001.  Their Nov. 2-4 meeting
here included a discussion of pension equity.
     The trustees expressed support for the 2003 and 2004 budget
projections, knowing changes will occur once the board finalizes its
three-year strategic plan for 2003 and beyond.  Trustees will review the
new strategic plan in March 2002, considering a final draft in August.
     The board is in the midst of a multi-year changeover from handling
health-care claims and pension transactions to serving as an advocate
and resource for members' health-care and pension needs.  In 2001 the
board moved its remaining health-care claims processing to outside
vendors.
     The board adopted the corporate plan for such a move in 1999 in
order to remain competitive in both the health-care and retirement
benefits fields.  At that time the board explained the move in its
corporate report: "Processing health claims and performing other
transactions require time at the expense of assisting plan members
through numerous life events such as births, illnesses, disabilities,
retirements and deaths."
     That transformation from what the corporate plan calls a
"transaction-oriented" organization to a "relationship-based"
organization is responsible for the 2002 budget hike.
     While trustee Nancy J. Haberstich, Lincoln, Neb., expressed
reservations about the 11.5 percent budget increase because of the
changing economic environment, she said she agreed the board is moving
in a good direction.
     Barbara A. Swartling, trustee from Bainbridge Island, Wash., said,
"We always knew this plan wouldn't be less expensive. We didn't move in
this direction because it was cheaper but because it's what we needed to
do to better serve the church and be competitive in the marketplace."
     John G. Kapanke, president of the ELCA Board of Pensions,
explained that the most expensive part of the board's transformation is
in the overlap period between the old and new systems -- the overlap
"bubble," he called it.  He added that 2003 would be the first
operational year of new systems, so that year's budget also would
reflect an increase.
     Several information items were reported to the board trustees,
including the pension equity study requested by the 2001 Churchwide
Assembly in August.  Based on resolutions brought by three synods,
assembly voting members asked the Board of Pensions to "prepare methods
to bring into equity pensions of professional leaders and to report its
findings to the church council."
     The ELCA's 10,816 congregations are organized into 65 synods.  The
churchwide assembly is the chief legislative authority of the church.
Assemblies are held every other year; the church council is the ELCA's
board of directors and serves as the legislative authority of the church
between its churchwide assemblies.
     The issue of pension equity has been raised at nearly every ELCA
assembly, Kapanke said.  "We've held up the Special Needs Retirement
Fund now in place, but that hasn't fully satisfied everyone's concerns.
We hope to have a report to the Church Council by November 2002."
     The Rev. Lowell G. Almen, ELCA secretary, told trustees,
"Underneath the assembly resolution was a concern for serious
disparities of salaries and pensions, particularly for those people who
willingly provide services in settings of low salaries who then are
affected in retirement.  This action had some steam behind it -- and,
depending on answers that are given, this issue will come back."
     Trustees heard good news about the Special Needs Retirement Fund
(SNRF) too.  As of Oct. 31, 2001, 433 people had agreed to do a monthly
deduction from their pension checks to assist those with low pensions, a
response that will amount to $159,552 for a year.
     The board sent letters to all pensioners offering the possibility
of a monthly deduction to help the SNRF, said the Rev. Ronald T.
Glusenkamp, board vice president for customer outreach; and early in
2002 all active members of the pension plan will receive a letter.  The
board's outreach to increase awareness and build the special fund is a
collaborative effort with the ELCA Foundation, he added.

*Sonia C. Solomonson is managing editor of The Lutheran, magazine of the
ELCA.

For information contact:
John Brooks, Director (773) 380-2958 or NEWS@ELCA.ORG
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