News Release -- 2003

Brethren Benefit Trust Board approves sponsorship of the Brethren Employees’ Credit Union

December 9, 2003 Elgin, Ill.

In a significant move toward the establishment of a Church of the Brethren credit union for all denominational members and their families, the Brethren Benefit Trust Board in November approved becoming the sponsor organization of the Brethren Employees’ Credit Union (BECU).

By approving a comprehensive business plan that outlines the sponsorship role and goals during its Nov. 21-22 meetings in McPherson, Kan., the Board also agreed to infuse BECU with $250,000 of capital to help increase the size of the credit union over the next five years.

BBT’s sponsorship role, which in late October was approved by the BECU board, is expected to be ratified in early 2004 by BECU members during the Credit Union’s annual meeting. This step will increase the partnership relationship between BBT and BECU that was established in early October when the organizations signed an agreement for BBT to serve as BECU’s third party administrator (TPA). This TPA agreement calls for BBT to assume all Credit Union staff and office responsibilities beginning April 1, 2004. BBT’s sponsorship of the Credit Union will give the financial organization official Annual Conference status within the denomination, opening the door for expansion of its charter to include all Church of the Brethren members. BBT’s infusion of capital will provide the Credit Union with the monetary base it needs to expand.

“Extensive focus group and survey research BBT and BECU jointly undertook this past summer indicates there will be strong support by Brethren for an expanded national credit union that offers competitive rates, strong customer service, and the promotion of Brethren values through socially responsible investing initiatives,” said Darryl Deardorff, BBT’s chief financial officer. “That is BBT’s vision for the Credit Union.”

In related news, Deardorff announced that Dennis Kingery has been hired to fill BBT’s newly created director of Credit Union Operations position. Kingery, who has been serving as the General Board’s Director of Financial Operations/Assistant Treasurer as well as serving on the BECU board since 1999, will oversee all operations of the Credit Union and will assist in the daily operations of the Brethren Foundation, beginning Feb. 15.


Board adopts a five-year strategic plan

The Board adopted the basic structure of a strategic plan to guide BBT’s major initiatives within the context of its mission and vision statements over the next five years. The plan focuses on seven priorities that support the well-being of the Church of the Brethren, its agencies, employees, and members. The priorities are designed around strengthening current BBT ministries and exploring emerging opportunities for possible expanded services.

Some of the work included in the plan began earlier this year, with the Brethren Medical Plan’s introduction of the Congregational Employee Plan (CEP) in January, changes in the financing of Pension benefits, and a relationship with Brethren Employees’ Credit Union being established in October.

“I see an evolution in our services,” said Dick Pogue, Board chair. “Our genesis has been reactive to well-described needs; Pension and Insurance benefits for church workers, for example. I think we are at a point where we are called to act proactively to respond to the anticipated needs of the Church and its members. In doing so, we must remember that our primary function is to serve the Church.”

Much of the Board’s discussion centered on the concept of well-being. While BBT’s charter from Annual Conference is to support the financial well-being of the Church of the Brethren and other people and groups that share its values, Board member Harry Rhodes reminded those present that “we are a ministry body first and foremost and what we are really about is people’s well-being.”


Other Business

Insurance Plans

  • As healthcare costs continue to rise, Brethren Medical Plan staff continue to explore ways to keep insurance premium increases at a minimum. Insurance Plans director Jeff Garber reported to the Board that in light of the significant increase in premium Brethren Medical Plan members are receiving for 2004, a restructuring of benefit options may be necessary. One possibility that is being investigated is offering a health reimbursement arrangement (HRA) in conjunction with a high-deductible option through the Congregational Employee Plan (CEP).
  • Garber reported that long-term care insurance is now available to all BBT Plan members through Coventry Care Link; enrollment materials have been mailed.
  • The Board approved a housing allowance exclusion of up to 100 percent of gross income for ministers who receive a long-term disability benefit.

Brethren Pension Plan

  • The Board approved an Investment Committee recommendation that there be no 13th check issued to annuitants in 2003, due to the continued impact poor stock market returns have had on the Retirement Benefits Fund since 2000.
  • Pension Plan director Don Fecher reported that the Plan Participants’ Handbook, revised every five years, has been completed and will soon be mailed to all current Plan members.
  • Fecher reported that the “A” and “B” designations for Pension Plan accounts not yet annuitized was implemented on July 1. The “A” accounts for accumulations prior to July 1, 2003, will continue to use an eight percent interest rate, while the “B” accounts for accumulations July 1 and thereafter will use a market rate assumed earnings factor — currently six percent.
  • The Board approved a housing allowance exclusion of up to 100 percent of total retirement compensation for retired ministers, including those who receive a Church Workers Assistance Plan grant.
  • The Board approved a lump sum Supplemental Income for Equitable Annuitants grant of $131,159 to be distributed among eligible retired lay employees of the General Board.

General

  • BBT’s Investment Committee reported that the first three quarters of performance for all of BBT’s fund managers, who are charged with investing the approximately $340 million in Pension and Foundation monies that BBT manages, were exceeding their industry benchmarks. “We’ve done well so far,” said Gail Habecker, committee chair.
  • The Investment Committee also reported that the securities lending agreement with LaSalle Bank, BBT’s custodial bank, has started to generate revenue for BBT. The agreement, which was approved by the Board in April, went into effect in September and has been earning about $8,000 per month. This new revenue helps offset custodial fees.
  • The Board approved a 2004 expense budget of $2,625,875 (net of $100,000 in Credit Union TPA revenue and $20,000 in other revenue), as compared to budgeted expenses in 2003 of $2,545,000. In addition the Board approved $348,250 for Credit Union grants and BBT capital expenditures.
  • The Board and attending staff traveled to Buckeye, Kan., to visit the offices and meet with staff and board members of Mutual Aid Association, with whom BBT has collaborated on Annual Conference exhibits and other activities over the past few years.
  • BBT’s 2004 Board meeting dates and locations are April 17-18, Elgin, Ill., July 6, Charleston, W.Va., and November 19-20, location to be determined.