Letters to lay pension participants address recent media criticism

The administrator of the Archdiocese of Boston's lay pension plan is seeking to address concerns over administration of the plan in letters sent last week to current and former employees.

Plan administrator Carol Gustavson sent two separate letters -- one to current employees of the archdiocese or its related entities and another to former employees eligible for an offer by the archdiocese to cash out of the plan early. Both letters contain virtually identical text.

The letters addressed recent criticisms surrounding management of the plan and sought to correct what the archdiocese said were inaccuracies in recent media coverage of how the archdiocese has handled the plan.

The move comes in the wake of news that the Daughters of St. Paul filed a lawsuit against the plan's trustees in an effort to withdraw funds contributed for their lay employees, and a press conference in which former archdiocesan chancellor David W. Smith slammed plan administrators and trustees for what he described as heavy-handed tactics to coerce former employees into an early cash-out of their pension benefits.

Last year, the archdiocese announced it was freezing its lay employee pension plan and switching to a defined-contribution 401(k) style retirement plan. At the time, the archdiocese said it would also offer eligible former employees the opportunity to take their money out of the plan or choose early annuity distributions at a reduced amount reflecting the plan's current funded status of 83 percent.

That decision drew criticism from Smith who said, that by encouraging former employees to take the reduced cash-out, the plan was transferring its losses to the participants. He also contended that those who take the cash out will ultimately suffer even greater losses because individuals will be unlikely to match the plan's returns if they reinvest the cash on their own.

Smith also questioned the morality of offering participants a reduced cash out, saying that such a move would be illegal under the Employment Retirement Income Security Act (ERISA), which governs most retirement plans. However, as a church plan, the archdiocese's pension plan is not bound by the law.

Gustavson countered that criticism saying that some former employees could benefit from taking the early cash.

"Each individual's life circumstances, including age, number of years before retirement, estimated life expectancy, and how and when the funds are invested, will result in a different determination of the value of a lump sum to that person."

"All individuals offered a lump sum have been encouraged to consult with a financial planner, and meetings have been held in March and April 2011 with financial educators present, who have provided information to attendees about how to evaluate these options," she wrote.

While she acknowledged that the cash-out was reduced to reflect the Plan's current underfunded status "rather than the funded status that might be attained at some point in the future," she also contended that the cash-out offer was a voluntary measure and that it "does not disadvantage participants who elect to wait to receive their benefits as a monthly annuity in the future."

The archdiocese has blamed the plan's current underfunded status on the lackluster economy, and Gustavson's letters address the fund's performance in recent years.

In 2007, according to the letters, the plan began to decline as a result of market performance, and by 2009, "only 74.6 percent of assets (were) available to cover the Plan's obligations" and the plan had a deficit of over $81 million.

With the recovery of the investment markets, the average funding ratio of the plan for 2010 improved to approximately 83 percent. Gustavson said that figure is comparable to Fortune 1000 company pension plans, which were funded at an average of 82 percent in the same period.

Gustavson's letters also address the other portion of the plan's funding -- contributions from employers, which for the Archdiocese of Boston's pension plan has included parishes, schools, central ministries and other Catholic entities.

Concerns have been raised that certain employers, including a number of parishes and schools, some of which are now closed, failed to make the required payments into the plan over a certain time period. However, the letters say that the archdiocese has addressed significant unpaid obligations to the fund through transferring $12.7 million from the Reconfiguration Fund into pension coffers.

The Reconfiguration fund was created to receive assets of closed parishes as part of the reconfiguration process initiated in archdiocese in 2004.

While the archdiocese has made progress towards addressing unfunded pension liability, the plan, according to Gustavson's letters, continues to be underfunded, with a deficit of $39 million for open parishes and $5 million for closed parishes. The letters also stated that another "$24 million deficit is spread across all other locations based on their allocated assets and liabilities."

In her letters, she also confirmed a commitment made in an April 1 statement Cardinal Seán P. O'Malley released to The Pilot that those who opted for the cash-out will be given the opportunity to reverse their decision. She said those individuals would receive a letter from Cardinal Seán P. O'Malley prior to April 30 giving them that choice.

Celebration of the Priesthood dinner raises over $1.8 million

BOSTON -- A record 1,700 people attended the 10th annual Celebration of the Priesthood dinner to raise funds for the Clergy Health and Retirement Trust ...

Lawrence parish helps community cope with gas explosion aftermath

LAWRENCE -- Volunteers at St. Patrick Church's Cor Unum Meal Center were serving dinner when multiple natural gas explosions and fires broke out in homes ...

Ceremony, Mass kick off St. Augustine Chapel bicentennial

SOUTH BOSTON -- St. Augustine Chapel and Cemetery began its year-long bicentennial celebration on the weekend of Sept. 14-16 with tours, special Masses, ...

Mass. Knights install new officers

The Massachusetts State Council Knights of Columbus recently held its Installation of State Officers at St. John the Evangelist Parish in Canton with ...

Deal will keep Sancta Maria Nursing Facility open

CAMBRIDGE -- Sancta Maria Nursing Facility announced Sept. 17 that it has negotiated a comprehensive operational contract with Advocate Healthcare Management ...

From Cardinal Seán's blog

As I mentioned in my preface to last week's blog, this week and last, I have been in Rome for meetings related to the work of the Pontifical Commission ...

Apostolic visitor outlines plans for expansion at Medjugorje shrine

WARSAW, Poland (CNS) -- The Polish archbishop tasked with overseeing Bosnia-Herzegovina's Medjugorje shrine has outlined plans for expansion, including ...

Pope names administrator as Indian bishop investigated for alleged rape

MUMBAI, India (CNS) -- Pope Francis has accepted the request of an Indian bishop accused of raping a nun to be relieved of his duties during the investigation. In ...

In letters to German cardinal, retired pope defends way he stepped down

VATICAN CITY (CNS) -- Retired Pope Benedict XVI expressed his displeasure with the way a German cardinal publicly criticized his stepping down as pontiff, ...

Thousands of Hispanics expected in Texas for Encuentro summit

Fort Worth, Texas, Sep 20, 2018 CNA/EWTN News.- As many as 3,000 Catholics of Hispanic background are expected in Texas this week for the National V Encuentro, ...

Church plans third-party abuse reporting system, code of conduct

WASHINGTON (CNS) -- Pledging to "heal and protect with every bit of the strength God provides us," the U.S. bishops' Administrative Committee Sept. 19 ...

Be grateful to parents, never insult them, pope says

VATICAN CITY (CNS) -- Honoring mothers and fathers means being grateful for the gift of life and Christians should never insult anyone's parents, Pope ...

Canadian cardinal: Women should help screen, train priest applicants

Poznan, Poland, Sep 18, 2018 CNA.- Increasing the role of women in screening and training priests is among the steps that should be taken to prevent future ...

Vatican delegation will travel to China this month to finalize agreement, Chinese newspaper reports

Beijing, China, Sep 18, 2018 CNA.- A newspaper tied to the Chinese Communist Party reported Tuesday that a delegation of Vatican officials will head to ...

Media reporting Vatican-China agreement could be signed in late September

HONG KONG (CNS) -- The long-awaited Sino-Vatican agreement on the nomination of bishops is expected to be signed in September, reported several media ...

Update: Irish singer Bono calls pope 'extraordinary man for extraordinary times'

VATICAN CITY (CNS) -- Bono, the lead singer of the Irish band U2, said he told Pope Francis that in Ireland "it looks as though the abusers are being ...

Cardinal Marx says mistakes were made, calls for change in German church

Cardinal Reinhard Marx, head of the German bishops' conference, admitted that mistakes were made in the German church's handling of sex abuse of minors ...

Church crisis response: Healing Masses, listening sessions, fasting

WASHINGTON (CNS) -- In response to the sexual abuse crisis in the church, Catholics are praying for victims, talking about their frustration and anger, ...

Pope names Minnesota priest as auxiliary bishop of Hartford

WASHINGTON (CNS) -- Pope Francis has appointed Father Juan M. Betancourt, a priest in the Archdiocese of St. Paul and Minneapolis, as auxiliary bishop ...

Listening church: Pope gives new vision for Synod of Bishops

VATICAN CITY (CNS) -- The Synod of Bishops increasingly should be a structure for listening to the Catholic faithful, demonstrating a local bishop's concern ...

Director of Courage releases letter on Penn. abuse report

Washington D.C., Sep 17, 2018 CNA.- Courage International, an apostolate to support people with same sex-attraction in leading chaste lives, has issued ...

Richmond bishop apologizes to victims; commits to opening, reviewing files

RICHMOND, Va. (CNS) -- In celebrating the Diocese of Richmond's first Mass of Atonement for victims of abuse Sept. 14, Bishop Barry C. Knestout apologized ...

Advocates decry historically low cap for refugee entry in 2019

WASHINGTON (CNS) -- Advocates for refugee admissions into the United States decried what one statement called a historically low cap of 30,000 for fiscal ...

Stanford University to remove saint's name from some properties

WASHINGTON (CNS) -- California's Stanford University will strip the name of 18th-century Franciscan friar, St. Junipero Serra, from some of its properties ...

Catholic Charities distributes disaster relief to areas hit by Florence

RALEIGH, N.C. (CNS) -- The Carolinas were hard hit with record rainfall and flooding rivers from tropical storm Florence since it made landfall Sept. ...

Archbishop Lori assures diocese he's with them in journey toward healing

WHEELING, W.Va. (CNS) -- In his celebration of Mass at the Cathedral of St. Joseph in Wheeling Sept. 15, Archbishop William E. Lori of Baltimore said ...

Bishop takes a (sky) dive to get pilgrims to Lourdes

HOVE, England (CNS) -- "The Moth has landed," tweeted the Diocese of Arundel and Brighton. The tweet Sept. 14 and a similar post on the diocesan Facebook ...

Words, promises are not enough to prevent abuse, archbishop says

VATICAN CITY (CNS) -- Inviting presidents of the world's bishops' conference to the Vatican to discuss abuse prevention reflects an understanding that ...

Pope praises Capuchin order's charism of authenticity, simplicity

VATICAN CITY (CNS) -- Capuchins are called to be men of peace, reconciliation and prayer and to be close to all people, Pope Francis told members of the ...

Path to healing starts with seeking forgiveness, Cardinal Wuerl says

WASHINGTON (CNS) -- A "Season of Healing" for sexual abuse survivors began in the Archdiocese of Washington with a Sept. 14 Mass at the Cathedral of St. ...

Archbishop McCarrick's unofficial role in Vatican-China relations

Vatican City, Sep 17, 2018 CNA.- Following reports that the Holy See and the People’s Republic of China could be about to sign an agreement ...

Archbishop Chaput: When we forget faith, we forget our humanity

Spokane, Wash., Sep 14, 2018 CNA.- When man tries to cling to reason and separate himself from faith, he forgets who he is and loses his source of hope, ...

Pope Francis warns priests against living a double life

Palermo, Italy, Sep 15, 2018 CNA/EWTN News.- During a day trip to Sicily Saturday, Pope Francis told priests and religious to fight their vices and strive ...

What is the pontifical secret?

Vatican City, Sep 14, 2018 CNA.- Following the allegations made by Archbishop Carlo Maria Viganò about the case of Archbishop Theodore McCarrick, ...

Catholic workers say U.S. aid cuts to Palestinians could be disastrous

JERUSALEM (CNS) -- The U.S. budgetary cuts to humanitarian aid institutions helping Palestinians could lead to long-term disastrous consequences, said ...

Vatican publishes list of synod participants, including papal nominees

VATICAN CITY (CNS) -- To the list of members of the Synod of Bishops elected by national bishops' conferences, Pope Francis added cardinals from 14 countries, ...