CROOKSTON — Pension Plan Concerns for Diocese of Crookston
Members of the Diocese of Crookston may find themselves facing a precarious situation regarding their pension plans. A letter from the bishop’s office dated October 24 has raised alarms, particularly for both current and former employees.
The communication noted that the defined benefit pension plan, overseen by Christian Brothers Services, is “significantly underfunded.” To address this shortfall, the diocese anticipates needing to contribute $24.6 million over the span of 25 years.
Bishop Andrew Cozens expressed significant concern for the well-being of former employees. He told the Grand Forks Herald, “We have serious concerns about taking care of our former employees. We will do everything we can to make sure they receive the benefits they expect and need.”
The Diocese of Crookston encompasses 65 parishes and eight Catholic schools across 14 counties in northwestern Minnesota, as mentioned on the diocese’s website.
Christian Brothers Services, based in Romeoville, Illinois, offers financial services specifically designed for Catholic organizations. This includes managing benefits like health insurance, retirement plans, and compensation programs.
Bishop Cozens explained that the diocese was first informed of the funding gaps earlier this summer when Christian Brothers Services announced potential increases in the pension plan’s payment rates. “We were informed of the proposed interest rate changes and discovered that the pension was significantly underfunded,” he said.
Roughly 500 current and former employees could potentially be impacted by the pension’s financial issues. However, it’s noted that the challenges facing the pension plan don’t extend to the 403(b) retirement benefits, which are managed separately through another insurance provider, The Standard.
The bishop also pointed out that until this year, the diocese had not been aware of the funding issues with the pension plan. “Maybe you weren’t charging enough to keep raising money, but then you should have told us that, right?” he remarked.
He added that there are about 180 other organizations using Christian Brothers Services for financial management, many of which are smaller parishes facing similar underfunding concerns, although he refrained from naming these organizations.
Bishop Cozens noted a lack of transparency from Christian Brothers Services. “From what I’ve heard, other organizations are having similar experiences,” he stated. The spokesperson for Christian Brothers Services declined to comment further, citing an inability to disclose information about the plans.
In response to these developments, the diocese has established a committee consisting of key financial team members to deliberate on the next steps regarding the pension plan. They are also in consultation with actuaries, benefits consultants, investment managers, and legal advisors.
“These people have dedicated their lives in service to the church and are counting on this pension, so we’re going to do everything in our power to meet that obligation because we think it’s a matter of justice,” Bishop Cozens emphasized.
