PHILADELPHIA (PA)
Philadelphia Inquirer
By Harold Brubaker, Inquirer Staff Writer
POSTED: November 06, 2013
The Archdiocese of Philadelphia plans to freeze the traditional pension for about 8,500 parochial school teachers, church office workers, and other lay employees, church officials said Tuesday.
The change, designed to keep the plan’s estimated $150 million deficit from increasing and whittling it down over time, will take effect June 30, after which current employees will no longer accrue benefits under the plan.
The pension plan, known as a defined benefit plan because it guarantees a certain benefit to participants, had $478 million in assets June 30, 2012, about 76 percent of what it needed to meet its projected long-term obligations of $630 million.
“This action isn’t being taken to resolve a short-term concern,” Timothy O’Shaughnessy, chief financial officer for the archdiocese, said in an interview. The plan has enough money to continue paying retiree benefits for years.
“The shortfall of $150 million is an issue that needs to be dealt with for the long term, both for the plan and for the archdiocese,” O’Shaughnessy said.
Rita C. Schwartz, president of the labor union that represents 650 teachers in archdiocesan high schools, said the move was not surprising, given the financial restructuring underway at the archdiocese in the last year.
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