Click here for a short summary of the issue. Click here for a detailed timeline.
See also the Pension Rights Center website.
Click here for ex-St. Peter's CEO John Matuska's 2011 letter to the IRS.
Click here for ex-St. Peter's VP of HR Bruce Pardo's 2011 letter to the IRS.
Haga clic aqui para verun resumen del problema en español.

Thursday, February 9, 2012

Article in Home News Tribune

Middlesex County's Home News Tribune today published a front-page article on the St. Peter's "church plan" crisis. Read it here. Big thanks to Larry Kaplan for ensuring that this article got published!

Besides giving much-appreciated exposure to the issue, the article serves as a reminder of a few things:
  • The IRS has no timetable for deciding on St. Peter's application for "church plan" status. When St. Peter's submitted their application, the IRS had a moratorium in force on granting such applications; now St. Peter's is one of the first institutions being considered for such status since the moratorium was lifted. A decision either way is far from automatic. This means that pressure brought to bear by, for example, contacting Congress can still have a big impact.
  • Back in December, St. Peter's CEO Ronald Rak promised to share by the end of February the hospital's strategy "to protect your retirement dollars, with the help of new outside experts." The hospital has three weeks to make good on that promise.
Keep in mind that outside retirement industry consultants helped get us into this mess in the first place. Note also that the chairman of the hospital's board of trustees, Donald Daniels, heads a benefits consulting firm with a specialty in Catholic hospitals.

Win, lose, or draw, we'll be here to help in any way we can.


    1. Jan. 2012 Mary xxxxxxxxx
    East Windsor, NJ 08520

    Internal Revenue Service
    Attention: EP Letter Rulings
    P.O. Box 27063
    McPherson Station
    Washington, DC 20038

    Re: Request for Church Plan Letter ruling by Saint Peter’s University Hospital: AKA “SPUH” for the
    Pension Plan #001 and Employer ID # 22-1487330

    To the Internal Revenue Service:
    I am a participant who has participated in the Pension plan for 16 years. I received a notice (Nov 22, 2011) that the SPUH has asked the Internal Revenue Service for a ruling that the Pension plan is a “church plan.” The notice says that if this ruling request is granted I will lose all protections under the federal private pension law, including the guarantee that my pension will be insured by the federal pension insurance program. I am writing to tell you why the Pension plan is not and has never been a “church plan” and what it would mean to me if the IRS grants SPUH’s request. I would like to have the opportunity to make an oral presentation to the IRS about this very important matter.
    The reasons that the Pension plan should not be granted “church plan” status are:
    1. The plan was not established by a church and is not maintained by a church. This ERISA type plan was established and has been maintained at all times by SPUH for its employees. The “Pension plan” is not maintained by an organization whose principal purpose is the funding or administration of a retirement plan. The plan is maintained by SPUH whose principal purpose is providing health and medical services and related secular functions. Essentially SPUH is the employer, not a church organization.
    2. When I started work at SPUH in 1984 the Pension plan administrator gave me a booklet that told me that it was paying premiums to the Pension Benefit Guaranty Corporation to insure my pension. That booklet and other booklets, statements, and oral communications over the years told us that we were protected by the federal pension law, ERISA. To my knowledge the plan has at all times been maintained as an ERISA plan.
    3. There has been great instability with the management at Saint Peter’s in past years, reflecting their miss-use
    Of revenue and running a deficit — even though they are a NON-PROFIT Corporation! Their credit rating was
    Down-graded back in 2007. They have under-funded the Pension plan for several years. They admit it is a “trust” fund for their retired employees. I would rather not have them in control of my pension money; as it is surely safer in a “trust fund” with the E.R.I.S.A insurance. “See Exhibit #009”

    4. Saint Peter’s Hospital does not allow ABORTION OR STERILIZATION procedures to be performed in the hospital. This is the extent of their so called “CHURCH AFFILIATION” Like many Hospitals across the country, the have a chapel, and also has some sort of rapport with Denominational as well as secular organizations.

  2. 5. Although Saint Peter’s University Hospital does have a “trustee” holding office and also being a Catholic Priest, this does not constitute control of the organization, and I fully believe that the “intent” of the “Church plan law” is
    to allow only bonafide “churches”, “church schools” and any Other Charity organizations church plan status. Since the hospital has in the past filed Erisa form 5500 stating that the plan is “define benefit plan #001” They Should Not get a letter ruling as a church plan. “See exhibits #007 and #008”. The majority of the trustees and ALL controlling directors are not church employees. “See exhibits #002 and #003”. Also there is no evidence that their benefits committee is controlled by a church! Ronald Rak’s letter of 12.01.2011 states that the people Responsible for the current Church plan application are Former employees, And they were not clergy! Exhibit # 15

    6. Saint Peter’s University Hospital admits that the pension is a non-revocable trust fund, “see the enclosed document” and therefore, if they are allowed to convert and access or use any of the money, then this is in violation of the Non-revocable trust agreement. Dated Jun.14.2010 Memo 64% funded Exhibit # 10
    7. In 2011, Saint Peter’s issued corporate Re-funding Bonds and the relevant pages are enclosed. Exhibit #001 shows the Hospital calling the pension plan an E.R.I.S.A. plan, while touting it being operated as a “church” plan. This is an IRREVOCABLE TRUST PLAN and can not, and should not be changed.
    8. Enclosed is an Employee Retirement handbook from the Hospital, clearly showing the Pension to be set up as an ERISA plan. Exhibit #005
    9. The last Annual funding notice “exhibit #004” demonstrates that the “plan” has a history of being underfunded. See Line #7 June 14, 2010 Memo of being 64% funded.
    10. Exhibit #006 “Standard and Poor” Report states SPUH is operating the ERISA plan as a CHURCH plan. “illegal”?
    11. Exhibit # 11 Credit rating lowered in 2010.
    12. Exhibit # 12--Enclosed letter to Bishop Bootkoski, which was sent by several people and NO RESPONSE Received!
    13. Exhibit #14 Ronald Rak‘s letter of 12.28.2011 states they are hiring an “outside concern” to protect the pension Funds. This tells me that SPUH is not capable of running the plan, and their control should be removed!
    If the IRS grants the “church plan” ruling requested by SPUH my pension will be at risk. The Pension plan does not have enough money to pay all promised benefits, being only 83% funded in 2008. If the ruling request is granted and SPUH were to terminate the plan, I could lose most or all of the benefits I worked 16 years as a Registered Nurse to earn. The work was very hard and I considered the pension to be an important part of my pay package. It was also a reason why I continued to work at SPUH. I am 46 years old and am too old to start earning a pension all over again. My Social Security benefits are not enough to live on, as the Present cost of living accelerates when on a fixed income and I may not have enough in savings to last throughout my retirement years. If you grant the SPUH ruling request, I may not be able to pay my future obligations due to a lost pension. Please deny the request!
    Thank you.

    1. I had lunch with Ronald Rak today, at
      26 Bissell Road in Lebanon, New Jersy!
      He told me everything is going to be OK, just a bunch of sheep to deal with and Saint Peter's will win!


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