LCMS Convention Workbook St. Louis, Missouri — 1975, Page 174

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174 ADMINISTRATION

the Board of Directors appointed Rev. William S. Graumann,
pastor of Immanual. Riverside, Calif. We welcome him aboard.

Quarterly meetings were held each year. As of Jan. 1, 1973,
administration of the prior Pension Plan was assumed by the
Board of Managers, thereby effecting another economy for the
Synod and its Benefit Plans.

All Concordia Plans were amended and new revised booklets
sent to all participants, 1975 edition. Although church plans are
exempt from the new federal pension legislation, the Concordia
Retirement Plan has been amended to meet the vesting require-
ments of the new legislation.

Concordia Retirement Plan

Retirement and long-term disability benefits are provided
through this Plan. In order to keep this benefit program current
with changes made in other plans which are integrated with
Social Security, and in order to meet certain Internal Revenue
Service and other governmental requirements, and in order to
offer benefits comparable to those required under the new
federal legislation (even though such legislation is not applicable
to the CRP), the following changes have been made since the
report to the last synodical convention:

—accrued benefits of the members of a withdrawn em-
ployer become nonforfeitable;

—a withdrawn employer can be enrolled in the Plan only
after a period of 3 years:

— vesting is now 100% after 10 years’ participation: the age
requirement for a vested benefit has been eliminated:

—the minimum normal retirement benefit is $3.00 per month
per year of creditable service:

—the retirement benefit is now integrated with the worker’s
Primary Insurance Amount instead of with the total Social
Security benefit:

—the waiver of contributions for young female workers has
been eliminated:

—a minimum annual compensation base has been estab-
lished at $3,600:

—the contribution rate has been slightly increased.

Concordia Survivor Plan

A thorough review of the benefits provided by the CSP
resulted in a judgment that a change in benefit levels from
the Plan was highly desirable. Taking note of the fact that
almost all of our workers are now covered under Social Security,
and further, in order to meet certain federal legislation, the
following changes were made in this Plan during the past
biennium:

—all married females are now enrolled as participants:

~benefit levels were generally adjusted downward in order
to provide a more realistic level of protection:

—benefits for survivors are now integrated with benefits
from Social Security on the basis of the Plan benefit for
the participant:

~—the contribution rate has been reduced:

—a minimum annual compensation base has been estab-
lished at $3,600.

Concordia Welfare Plan

Health care, disability income, and death benefits are pro-
vided through this Plan. Approximately 56,000 claims were
processed in 1974. An exhibit at the end of this report reflects
the high degree of benefits being paid.

In 1971 dental benefits were introduced into the CWP at
no extra charge. The board at that time resolved to analyze
the effect of these and other changes on Plan costs and reserves
over the ensuing years before making any further benefit
changes. Unprecedented acceleration in health care costs (over
50% increase in the past 5 years) resulted in a significant recent
excess of payments over income, resulting in a corresponding
acceleration in planned reduction of the Plan reserves. Accord-
ingly, any changes in the Plan are being postponed pending
continuing study. It appears probable that increasing costs in
delivery of health services will bring about the first increase in
CWP contribution rates as of Jan. 1, 1976.

During the past biennim the following changes have been
made for reasons indicated:

—a minimum compensation base has been established at
$3,600, thereby corresponding with the other Concordia
Plans, avoiding confusion, and facilitating computer
programming:

—definition of ‘thospital’’ no longer excludes a facility used
primarily for treatment of alcoholics, a provision necessary
to meet certain state statutes and to correspond to changes
made by the advisory insurance company:

—age for mandatory retirement status was changed from 72
to 70 to correspond with prior changes made in the CRP;

—leave of absence provision was included, permitting a
leave of a maximum of 3 years, in order to correspond with
provisions in the CRP and CSP.

Pension Plan for Pastors and Teachers

,

The original synodical benefit plan, the ‘old plan,” will for
many years to come continue to provide retirement and dis-
ability benefits in addition to those from the Concordia Plans.

In 1974 the minimum monthly retirement benefit was in-
creased to $200 for a member, $120 for a surviving spouse. If
the combined earned CRP and Pension Plan benefits are below
this amount for the eligible recipient, the Synod will make up
the difference through gift subsidy. This increased benefit was
a direct result of the efforts of the Pension Work Committee,
whose report appears with the report of the Board of Trustees.

The Pension Plan booklet is being completely revised and
rewritten. A new booklet will be mailed to each participant.

The Synodical Support Program

The Board of Managers is charged by the Synod with the
administration of the Support Program. Through a fraternal
grant from the Aid Association for Lutherans, an in-depth
study of the program was conducted in 1972—73 under project
direction of Dr. Clarence F. Golisch. retired administrator of
Bethesda Lutheran Home. In 1974 a copy of his study including
adopted recommendations and guidelines was sent to every
synodical District President and director of social ministry.

Referrals from Prior Synodical Conyentions

1. 1969 Resolution 12-16 and 1973 Resolution 12-16 relative
to making the Concordia Welfare Plan coverage available to
seminary students have been resolved as a result of a meeting
with the synodical schools’ business managers. The business
managers concluded that it was preferable to secure coverage
through private carriers.

2. 1973 Resolution 12-1 has been resolved through the adop-
tion of a more liberal vesting provision in the Concordia Retire-
ment Plan.

3. Still under study and reasons associated with the study
are:

—1973 Resolution 12-09, Adjustment of Concordia Retirement
Plan Benefits to the Cost of Living. The underlying under-
writing principle of variable benefits here requested is the
anticipated increase in the market value of equity-type in-
vestments. Since in accord with present market performance
this principle is working negatively (a factor which would have
resulted in lower benefits on such variable basis), considera-
tion of this item has been postponed.

—1973 Resolution 12-16, Expansion of Maternity Benefits
Coverage.

—1973 Resolution 12-17, To Provide Adoption Cost Coverage
in Lieu of Maternity Costs. The action taken by the Board
of Managers in 1971, providing a major increase in benefits
by adding dental coverage, prompted the board to hold in
abeyance any Welfare Plan benefit changes until such time
that the effect of the major change then made could be mea-
sured through actual experience. That action as well as the
excess of expenditures over income and planned decreases
in reserves through the increased costs of benefits approved
in 1971 has precluded for consideration at this time any
further benefit improvements.

—1973 Resolution 4-42, Rights of Withdrawing Members. All
the rights of members and employers relative to the Con-