Although reserves for the Presbyterian Church (U.S.A.)’s Pension Plan continued to improve in 2010 after 2008’s global financial meltdown, the denomination’s Board of Pensions (BOP) decided at its March 3-5 meeting here not to grant an “experience apportionment” for 2011.

An experience apportionment is a percentage increase in pension payments for retired plan members and in pension credits for active plan members. Each 1 percent experience apportionment  increases the Pension Plan’s liabilities by about $50 million.

Analysis provided by Towers Watson, the Pension Plan actuary, showed that all current pension benefits and pension credits are fully funded, continuing a long-standing pattern that was only interrupted during the height of the financial crisis, when assets dipped to 98 percent of liabilities.

“During 2010 we continued to rebuild reserves in the Pension Plan,” said Frank S. James, III, chair of the Pension Committee, adding, “To protect the plan and members’ future benefits, we believe it best to continue to strengthen those reserves before granting another experience apportionment.”

The BOP utilizes a formula established in 2005 ― the Funding Adequacy Level ― to determine experience apportionments. The formula suggests that an apportionment can be granted if the funding level is at least 125 percent of assets to liabilities. At year end the Funding Adequacy Level was 122 percent.

Donald Fleischer, a former member of the board of directors and current consultant to the Board, noted, “It’s important to adhere to the policy to help ensure that the plan remains fully funded in future years. Prudent action today will help protect the security of benefits that are promised to church workers many decades into the future.”

In a separate action, the board granted a disability benefit increase of 1.5 percent for disabled members receiving disability benefits on Dec. 31, 2010. This increase, which takes effect July 1, 2011, is designed to offset the cost of inflation.

The assets and liabilities of the Death and Disability Plan are evaluated independently of the other BOP plans.

Judith D. Freyer, the BOP’s senior vice-president, treasurer and chief investment officer said the BOP’s balanced investment portfolio realized a 13.6 percent return in 2010 and has regained 87 percent of its value prior to the economic crisis of 2008.

Investment results for the first couple of months of this year have also been positive, increasing the market value of the board’s balanced portfolio to $7.1 billion. 

Paul Volker, vice-chair of the BOP Healthcare Committee reviewed changes made in the board’s Medical Plan last year as it adjusted the plan’s benefits to federal health care reform.

“Most [of the changes] were benefits expansion, but the economic impact has been minimal,” Volker said.

Nevertheless, long-term health care cost trends are rising, he added, “which means a probable need for a dues increase in the near future” ― probably in 2012. The board will address the issue at its June meeting, Volker said.

Medical Plan dues have remained unchanged for four years.

The Healthcare Committee has scheduled a special meeting next month to take a more concentrated look at the Medical Plan in light of federal health care reform. “It’s clear that we may no longer be the sole provider for members,” Volker noted.

The BOP heard a report on its Assistance Program, which in 2010 made more than 1,500 grants totaling more than $5.8 million for urgent financial needs of church workers, income and housing supplements for retired church workers in need and pastors’ vocational leadership needs.

The Assistance Program is funded by the Christmas Joy Offering and designated gifts by individuals and congregations.

“The grants given by the Assistance Program make a real difference in the lives of Presbyterian ministers, other church workers, and their families who struggle to make ends meet, especially during difficult economic times,” the board said in a bulletin issued after the meeting. “Assistance Program grants have helped recipients to remain in their homes, pay for emergency medical expenses, and rebuild after disasters such as floods and hurricanes, among other good works.”

After five years of providing matching grants to synods and groups of presbyteries to fund practical skills training for congregational pastors, the Middle Governing Body Grant Program was suspended by the BOP’s directors. Over the past two years as the financial resources of the middle governing bodies have become more limited, fewer synods and groups of presbyteries have sought the grants.

Another Assistance Program ― the Presbyterian CREDO conferences for pastoral discernment ― continues to thrive after five years, with six additional eight-day CREDO conferences scheduled for 2011.  CREDO director Mary “Minner” Serovy said there are waiting lists for most of the 2011 conferences.

The purpose of Presbyterian CREDO is to promote the holistic health and welfare of pastors serving congregations. Participants work on personal and professional renewal, concentrating on four major components of well-being: spiritual, vocational, financial, and health.

The Rev. Peter Sime, vice-president for assistance, CREDO and funds development, said CREDO leaders “are talking about opening up the CREDO conferences to other age groups (until now invitees have been ages 40-55) or other interested groups to expand the reach of the program.”

The board re-elected its leadership for another two years: Thomas C. Paisley, Jr., chair; the Rev. Laird J. Stuart, vice-chair; and Susan Reimann, second vice-chair.