The news last week that the College for Bishops was launching a $15 million capital campaign to assure its future was greeted by an unusually large number of negative comments here on the Café, as well as on our Facebook page. More of that negativity was directed at the bishops than seemed fair to me. I am returning to the issue not to suggest that the bishops are blameless, but to because I think it provides a useful opportunity to examine how decisions get made, money gets spent, and interests get met in our church.
For me the lesson in this has much less to do with the College for Bishops than with the fact that the size of the surplus in the Church Pension Fund, and the difficult economic position of so many of our parishes, makes the position of Church Pension Fund trustee a more pervasively powerful one than I had previously realized.
A few pertinent facts:
1. The Episcopal Church’s pension fund is currently funded at 1.26 of future obligations. The industry average is about .85. Even implying conservative standards, the fund has a significant surplus.
2. Despite the surplus, the trustees of the pension fund elected to cut off funding to the College for Bishops, Fresh Start, a diocesan-based program that helps prepare clergy for new assignments, and the CREDO program for lay employees. The trustees voted to continue funding for the CREDO programs for bishops and clergy.
3. In the wake of that decision to cut funding for these programs, the aforementioned capital campaign was announced to save the College for Bishops, but no similar campaigns have been announced to save the programs for clergy and laity.
There may be good reasons for sitting on a mammoth surplus in the pension fund, while cutting support for programs and continuing to require an 18 percent clergy pension contribution from shrinking, cash-strapped parishes, but it would be nice to know what those reasons are.
There may be a solid reason to ask the church to rally in support of the College for Bishops, while making no mention that other programs serving different audiences have been cut, but, again, it would be nice to know who made the decision to kick off this capital campaign, and whether rallying support for the other programs was considered.
I am not questioning anyone’s intentions here, simply asserting a need for transparency.
One thing seems certain to me: Decisions regarding the pension fund have the power to drive other decisions in the church, and to drive them in ways that don’t, in this instance, seem to serve the interests of the majority of the people in our pews. I am not arguing in favor or against funding for the College for Bishops, Fresh Start and Lay employee CREDO. I am simply saying that keeping the pension surplus at its current level takes a lot of money out of the system. It forces people with programs that might be beneficial to the church to seek funding from lay people who are already stretched thin from making 18 percent pension payments for their clergy. These folks are about to be stretched further by paying contributions to the lay employee pension plan and the mandatory denominational health plan contributions.This does not seem like a sustainable way in which to do business.
Something else to consider: the pension fund trustees control something called the Legacy and Gift Fund, which is not restricted by laws that govern how pension surpluses can be used. The Church Pension Group’s 2010 annual report states that the legacy and gift fund that is not encumbered by donor restrictions but is controlled directly by the trustees now stands at $14.6 million. This fund, which had sustained the College for Bishops, Fresh Start and Lay CREDO, took a hit during the economic downturn, but has rebounded nicely. It would seem that it is still capable of supporting these programs, or being tapped for some other purpose, such as giving parishes a bit of a break on their pension payments.
I’d also be interested in learning what legal restrictions do, or do not, exist on the interest earned by the pension fund’s enormous surplus. As our church continues to consider major structural changes in response to distressing financial realities, this question is going to become increasingly germain.