For over 40 years, the Diocese of New Ulm has enrolled in the Christian Brothers Employee Retirement Plan (CBERP), which is managed by Christian Brothers Services in Romeoville, Illinois. In July, the diocese was informed by the Christian Brothers that their pension plan was significantly underfunded and did not have assets available to meet all long-term obligations. Most of the employees impacted by this shortfall are Catholic School teachers.

Christian Brothers Services manages pensions for 180 dioceses and member organizations, impacting 4,000 people nationwide. The Christian Brothers would need $42 million over the next 25 years to resolve its current cash deficit.

To remain in the pension plan, the New Ulm Diocese would need to continue its employer contribution in addition to higher payments to cover the shortfall. The diocese would need to contribute over $2 million annually for the next 25 years. This amount is not feasible for the New Ulm Diocese, forcing them to seek alternatives.

In response to the pension shortage, Bishop Zielinski announced the creation of an ad hoc committee to determine the diocese’s next steps in resolving the crisis for employees. The committee is made up of the Diocesan Finance Council and the Priests’ Council. The diocese has also secured the services of Arthur J. Gallagher & Co, for consulting on investing and legal advice.

The teachers and staff at New Ulm Area Catholic School learned last month that their pension funds could be at risk. In July, Christian Brothers Services – the organization managing the pension for 180 dioceses and member organizations—informed the New Ulm Dioceses that pension funds were significantly underfunded and there were not enough assets to fully pay all retirement plans.

In the letter submitted to pension holders on October 23, Bishop Zielinski said the diocese was deeply disturbed by the pension shortfall, but called for patience as the diocese studied its options.

“I am confident that with God’s guidance and the efforts of the committee of experts and consultants that we have put together, we will be able to navigate this challenge with prudence and transparency,” Zielinski said.

The committee has made no official decision at this time.

In a statement released Wednesday, Nov. 19, Zielinski expressed deep concern for the employees of all dioceses impacted by this financial crisis and believed helping them is a critical issue of justice.

“These dedicated individuals have devoted their lives to serving the Church,” Zielinski said. “We are committed to achieving the best possible resolution in this very serious matter.”