News & Articles


Legacy Pension Plan ("Option A") To Be Merged into Retirement Plan

Date: November 3, 2016
Current 403(b)(9) FCMM Retirement Plan is sound and not affected by Pension Plan adjustment and merger.

With enactment of legislation by Congress late in 2015, church retirement plans were provided an overdue opportunity to “fix” older defined benefit pension plans. The FCMM Board of Trustees has subsequently taken action to merge the Pension Plan into the Retirement Plan at the end of 2016. In summary, the Pension Plan ("Option A") will be brought into balance with invested assets and the resulting values will be transferred into the Retirement Plan.

Pension Plan “Retirement Annuity Credits” will be converted to a current dollar value for each Pension Plan member under age 80, whether or not the member is currently in benefit pay status. Upon a member’s choice, this adjusted value may be (1) turned into a monthly benefit payment ("annuity") under the Retirement Plan's in-plan benefit, (2) invested in the various Options of the Retirement Plan, (3) rolled out to an eligible retirement plan or IRA (losing minister housing allowance designation if not re-invested in a church plan), or (4) taken as a taxable distribution.

Each Pension Plan member has been mailed complete information along with a response form to select his/her choices.

Established in 1971 as a defined benefit retirement plan, the Pension Plan based benefits on higher growth assumptions than have been exhibited in the last two decades. The inflexible requirements of the Plan, such as a certain rate of growth credits and a now-superseded actuarial basis (underestimating longevity of participants), led the FCMM Board to close the Plan to new contributions after 2003 and then to discontinue increases to member accounts after 2014. While at that time some hope remained that a robust market could return the plan to being fully funded, recent market experience and long-term projections do not support this prospect. Current projections show that the plan would run out of funds to pay benefits in as soon as ten years if no action is taken.

The FCMM Retirement Plan (a defined contribution 403(b)(9) church plan launched in 2004), which includes Options C, D, E, F, G, H, & J, is fully healthy and solvent. Option C, the successor to the Pension Plan “Option A”, is fully funded and is structured to be sustainable through economic cycles.

With the merger alternative, the Board has applied fiduciary responsibility with prayerful concern for all members and made available the widest range of choices for individual circumstances.