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Annuity Board trustees grant increases in benefits & relief

DALLAS (BP)–Trustees of the Annuity Board of the Southern Baptist Convention voted to give a 10 percent permanent increase in January 1998 to most of the 28,000 retirees in pay status in December 1997, during their Nov. 3-4 meeting in Dallas.
Trustees also voted to increase Adopt An Annuitant supplementary benefits by 50 percent, to $75 a month. People on the board’s relief roll also will receive 10 percent increases in their checks at the end of January.
Treasurer William C. Lee reported on contributions and earnings through the third quarter, saying total assets reached $6.41 billion, up 13.1 percent from $5.67 billion at the beginning of the year.
Lee reported net income of $785 million in the first nine months, compared to $412 million for the same period in 1996. Participant contributions were $211 million, an increase of 15.3 percent over the first nine months of 1996. Benefit payments and withdrawals reached $239 million. The treasurer noted increased missions giving by Southern Baptists caused the Annuity Board to receive an unscheduled $37,875 in September and October, representing program advance funds that exceeded the 1996-97 Southern Baptist Convention Cooperative Program Allocation Budget. All this money will go for relief.
The trustee administrative policy committee, chaired by Joseph A. Mack of South Carolina, recommended, and trustees adopted, a 1998 operating budget of $44.3 million, an increase of slightly more than 4 percent over the 1997 spending plan. The Annuity Board receives no Cooperative Program funds for operations, but pays all expenses from charges against assets.
Trustee chairman Timothy E. Head of South Carolina thanked God and praised executive personnel for the success of investments that made possible the largest benefit increase since 1992.
O.S. Hawkins, having just completed his first month as Annuity Board president, said, “This is what we are about — blessing the lives of the servants of God. Our investment success will always be channeled to the annuitants who have entrusted their funds to our plans. Every annuitant will have good places to spend the increased income.”
Hawkins also said, “I am particularly pleased we have been able to increase relief and Adopt An Annuitant benefits. These are the people who need it the most. More than half the people on relief receive no regular annuity benefit because they were never enrolled in the Church Annuity Plan. The Southern Baptist Convention Cooperative Program is the foundation of our relief ministry, and every cent we receive from the Cooperative Program goes to someone in desperate need. Our success with raising money through the endowment department lets us supplement these convention receipts and help more people.”
The Adopt An Annuitant benefit, which has been $50 a month since the program was started in 1981, will now provide $75 a month to nearly 2,800 couples or individuals with low monthly benefits.
In another earnings-related matter, trustees approved extending a special billing credit to state conventions through the year 2001. The program, established Jan. 1, 1995, waives state convention billing costs for the Church Annuity Plan’s protection section, a part of the plan that provides a survivor benefit and supplemental disability benefit to eligible participants. There is no cost to the participant or church for the benefits that range from $100,000 for participants age 35 and younger to $10,000 in survivor benefits for participants age 71 and older. A supplemental disability benefit of $400 per month is paid to eligible participants. Success in investments and the favorable mortality experience of participants has resulted in a surplus in the fund.
John R. West, chairman of the investment committee, commended staff and participants for the lack of panic among participants when the stock market went through dramatic changes the week of Oct. 27. He attributed a generally calm response to the Annuity Board’s LifePoints educational program. Launched in 1996, the LifePoints program assists participants in determining their needs, goals and risk tolerance for retirement investments.
The insurance committee, chaired by Virgil V. Ayres of Louisiana, reported there would be no increase in rates Jan. 1, 1998, for the Personal Security Program (PSP) comprehensive medical plan. The experience of the plan will be reviewed quarterly with the possibility of a rate increase at mid-year. The Personal Security Program is designed for individuals in churches with 10 or fewer employees.
Underwriting (giving evidence of good health) will continue to be required for admission to the Personal Security Program medical plans, due to passage of a federal law exempting certain church plans from the section of the Health Insurance Portability and Accountability Act that requires accepting applicants regardless of their medical condition.
There will be an increase in the rate for the PSP medical plan for people with Medicare from $59.19 to $75 per month. Ayres noted the plan, which is about one-half the cost of comparable benefits in other available plans, has been running an operational deficit and had to be increased.
The trustee relief committee, chaired by Guy Morton of Ohio, reported 49 applications for relief were reviewed. They approved 23 two-year monthly grants, 11 two-year expense grants, and declined 15 requests that were outside guidelines. The committee also approved 131 recipients added to the Adopt An Annuitant roll during the third quarter of 1997 and added five to the roll at this meeting. Relief benefits will increase by 10 percent in January. The new grant amounts will be $200 per month for single people and $265 per month for couples.
Trustees approved a 1997 Christmas check of $200 for each person or couple on the relief roll as of Dec. 1.
The trustee luncheon on Monday featured an address by W.A. Criswell, pastor emeritus of First Baptist Church, Dallas.
The trustees’ Monday evening dinner was a time of honoring Paul W. Powell, the board’s president from March 1990 to Sept. 30 of this year. Trustees also adopted a resolution of tribute to the late Albert Lee Smith Jr., a trustee from Alabama who died Aug. 12 following a home accident the day before.
The board adopted responses to an action by the Southern Baptist Convention in June 1997, and to a motion referred by the convention to all entities. The action of the convention asked the Annuity Board to consider an open enrollment period for the comprehensive medical plan. Trustees declined to comply with the request after outside consultants reported such a step would create “… a high likelihood of adverse selection against the plan and, accordingly, a financial risk to the plan.” A complete report will be presented to the 1998 Southern Baptist Convention annual meeting in Salt Lake City. On the referred motion, which called on all agencies not to make contributions to the Cooperative Baptist Fellowship, the trustees reported, “The Annuity Board has never made contributions to the Cooperative Baptist Fellowship or its ministries.”
The next scheduled meeting of Annuity Board trustees is Feb. 23-24 in Dallas.

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  • Thomas E. Miller, Jr.