Summer meetings of the Presbyterian Church (U.S.A.)’s Board of Pensions (BOP) are sometimes as quiet as a hot July day. Not this one.
At it’s July 21 meeting here, the board was told that its two top leaders will retire in 2014: President and Chief Executive Officer Robert W. Maggs Jr. at the conclusion of the 2014 PC(USA) General Assembly in Detroit, and Executive Vice-president and Chief Operating Officer Francis E. “Frank” Maloney at the end of that year.
Maggs has been with the board 13 years; Maloney for 38.
Board Chair Thomas Paisley named BOP member John Hamm to chair the search committee, and said the rest of the committee will be in place by the board’s next meeting in October. The goal, he said, is to present a candidate for approval by the board in the spring of 2014, with confirmation at the 2014 Assembly, June 14-21 of that year.
Maloney told the Presbyterian News Service he will wait to retire until the end of the year to help provide “a seamless transition.”
Maggs and Maloney need not worry about their pensions. As it has been since its founding shortly after Presbyterian reunion in 1983, the PC(USA)’s Pension Plan is fully-funded, said Vice-president for finance and accounting Michael Fallon. Current plan assets are 109 percent of projected liabilities.
Total assets in the BOP’s balanced portfolio are currently $7.1 billion, reported Senior Vice-president for Investments Judith Freyer. The board’s return on those investments for the first six months of this year was 6.1 percent.
“Most people in investments are optimistic,” Freyer said, “though the entire market remains very volatile.” This year, she said, “will be another challenging year for investors,” citing such factors as the “fragile” U.S. economy, the European financial crisis, global political and economic instability and “global economic linkages ― when China slows down, we slow down and when we slow down, China slows down,” Freyer said.
With the fate of the Affordable Care Act somewhat settled by the recent U.S. Supreme Court decision affirming its constitutionality, the BOP’s Medical Plan continues to evolve. “The Supreme Court decision … has no immediate effect on the Medical Plan,” said Vice-president for Benefits Patricia Haines, but she told the Healthcare Committee that the board needs to focus on costs, regardless of the future of healthcare reform.
“While we continue to address healthcare reform, we also need to be focused on the affordability of coverage for our members and employing organizations,” Haines said, adding, “We will continue to look at the choices available to us for controlling costs.”
Dues are going up for the board’s Affiliated Benefits Program (ABP), under which churches and other employing organizations may offer medical coverage only — or medical with death and disability coverage — to employees who are in non-installed positions and are scheduled to work 20 hours a week or more.
The board approved an increase in monthly subscription dues of 7 percent, on average, for active ABP participants and ABP early retirees, effective Jan. 1, 2013. The increase doesn’t apply to Medicare Supplement subscribers, whose 2013 dues will be decided in the fall.
As previously announced, the BOP will begin offering benefits to Benefits Plan members’ qualified domestic partners and the partners’ eligible children, effective Jan. 1, 2013. To enroll a qualified domestic partner, a member must submit official documentation of a civil marriage, civil union, or domestic partnership from a state or foreign jurisdiction. The official documentation does not need to be from the member’s state of residence, provided that it is valid in the state where it was issued.
Members may request information packets by contacting the board at 800-773-7752. Those packets will be mailed beginning Oct. 1, 2012, and will include forms and details on adding a qualified domestic partner and children to the plan.
To ensure enrollment of a qualified domestic partner by the Jan. 1 start date, members should contact the board before Oct. 1 to allow sufficient time to submit the required information.
Reflecting on the recent General Assembly, Maggs said, “There are a great many good things that are going on in the PC(USA), but one cannot address the problems unless and until we define them properly.”
He said the board “focuses on things one step at a time and we will be working on scenarios by the end of the year that will help us to look out for individual members of the plan, which is our responsibility.”
Perhaps reflecting on his and Maloney’s departures in two years, Maggs said “the Board of Pensions will continue to pay particular attention to organizational development and succession planning to make sure the confidence of all our members remains.”