After each regular meeting of the Board of Directors of The Board of Pensions of the Presbyterian Church (U.S.A.), the Board of Pensions publishes The Board Bulletin. This Bulletin reports key information presented and actions taken at the fall 2018 meeting that affect plans and programs administered by the Board of Pensions.
Serving the Church and Serving Better were themes of the Board of Directors fall meeting Saturday, October 27. Vacancy dues, which many congregations have struggled with, will be eliminated. And more PC(USA) ministers may engage in personal and professional renewal with expanded eligibility for Sabbath Sabbatical Support Grants. These actions and more are covered here.
A strong sense of stewardship and solid management of the revenue stream on the part of the Board of Pensions enabled Directors to eliminate vacancy dues, effective January 1, 2019. Currently, congregations pay dues for the first 12 months that a minister member's position is vacant. Going forward, this burden has been eliminated.
Suzanne P. Welsh, Chair of the Investment Committee, provided an overview of the work of the Committee on behalf of Benefits Plan members and their beneficiaries.
The Balanced Investment Portfolio has three major components: U.S. and international equity, fixed income, and alternative investments. The Committee meets three times a year and has an annual in-depth review of each component. At the fall Board Meeting, the Committee reviewed the fixed income component of the portfolio.
The Committee had educational forums on investing in private equity and real estate, and approved commitments to limited partnerships investing in private equity and real estate.
The Committee affirmed the long-term strategic asset allocation ranges approved by the Board of Directors and affirmed that the August 31, 2018, asset allocation of 36.1 percent in U.S. stocks, 21.8 percent in international stocks, 27.7 percent in fixed income, and 14.4 percent in other assets were within the approved ranges.
The Investment Committee is responsible for reviewing and receiving reports from the Committee on Mission Responsibility Through Investment (MRTI), including the annual General Assembly Divestment List. The Investment Committee adopted the 2018 Board of Pensions Prohibited Securities Lists, to include the 2018 General Assembly Divestment List, which will be distributed to all separate account managers.
Judith D. Freyer, Executive Vice President and Chief Investment Officer, reviewed 2018 year-to-date performance of 3.7 percent within the framework of global economic and political events. The Balanced Investment Portfolio exceeded the return of the Asset Mix Policy Benchmark for the 20 years ended August 31, 2018. The Policy Benchmark assumes passive management of the portfolio using index funds. The portfolio also exceeded the 6 percent long-term investment return assumption for the 20 years ended August 31, 2018.
The Balanced Portfolio is the investment fund for the Pension Plan, Death and Disability Plan, Endowment Fund, and Assistance Program as well as restricted gifts made to the Board of Pensions. On August 31, 2018, the portfolio had a market value of $9.7 billion.
Directors approved the Christmas gift from the Assistance Program to the recipients of Income and Housing supplements. Many recipients have told the Board of Pensions that this extra income at Christmastime has meant they could share in gift-giving. All plan members receiving Income and/or Housing supplements as of November 1, 2018, will receive the gift. Single individuals will receive $250; members with spouses, $500.
Directors voted to expand eligibility for Sabbath Sabbatical Support Grants. Effective January 1, 2019, they will be open to any Presbyterian Church (U.S.A.) minister enrolled in Pastor's Participation engaged in or supporting congregational ministry, such as interim ministers and mid council staff. Currently, grants are limited to ministers serving congregations of fewer than 200 members.
Applicants will have to have been continuously enrolled in Pastor's Participation (previously, the Traditional Program) for at least the past six years. Their effective salary may not exceed $80,000, and they will have to show financial need. The Board of Pensions must approve their sabbatical proposal and costs. Ministers will be eligible to receive one sabbatical grant per six-year period.
Supporting retirees in the call to wholeness continued to be a concern for Directors. They voted to increase the formula for determining Housing and Income supplements for retired Benefits Plan members and surviving spouses.
Income Supplements use income target levels. The chart below shows the percentage of congregational ministers' median effective salary ($59,100 for 2019) that a recipient may have when an Income Supplement is added to all other income:
|2019 Income target level guidelines |
|Years of Pension Plan participation||Single member/surviving spouse||Retired members with spouse|
|10 to <20||Prorated||Prorated|
|20 to <25||55%||65%|
|25 to <30||60%||70%|
|30 or >||65%||75%|
The Housing Supplement for 2019 is 75 percent of the ministers' median. The percentage used for the assisted living determination will be 100 percent of the ministers' median effective salary. Anyone who believes they may be eligible for a supplement may contact the Board of Pensions.
Directors kept the Board of Pensions on its trajectory of growth with approval of the 2019-2020 Strategic Vision, the 2019 Initiatives, and the associated administrative budget. In the two years ahead, the agency will continue to offer new and different products, along with the flexibility and choice found in the commercial market. The goal: To serve an increasing number of those who serve the Church.
In approving these documents, the Directors endorsed mounting efforts by the Board of Pensions to assist the Church in building ministerial leadership for the future. The 2019 initiatives also call for strengthening connections among the denomination's varied constituencies.
While growth continues and outreach expands, the Strategic Vision and Initiatives ensure that the agency's hallmarks of financial stability and quality of service will remain firmly affixed.
Directors clarified Benefits Plan language concerning eligibility of those who are scheduled to work 20 hours a week or more. In addition, Plan Section 3.2 clarifies that ministers who are in self-employed validated service may enroll for medical coverage.
The next Board of Directors meeting is scheduled March 14-16, 2019. For information, email the Corporate Secretary.