Florida Catholic | Religious Money Matters

With that $50 a semester, or $100 a year per religious, the order covered the living expenses of the sisters who worked at the school.

Retirement planning was out of the question. And until 1972, members of religious orders — because of their vow of poverty — were not eligible for Social Security.

The crisis peaked in the 1980s, as older religious retired and younger vocations nearly disappeared. Even though stipends had increased slightly, not enough young religious were working to pay for the care of elderly members.

“We had people at the welfare office getting benefits for our sisters,” Sister Lichtenberg recalled during a recent national conference in Miami for treasurers of religious communities.

That was a difficult choice for religious who had devoted their lives to serving the poor as teachers, nurses or social workers, said Sister Hertha Longo of the Sisters of St. Agnes of Fond du Lac, Wis. “Do you want to go on welfare? Do you want to take money from the poor?”

National Religious Retirement Office 2006 Annual Report
Retirement Fund For Religious

That time of crisis, however, proved to be a learning curve for religious communities in the United States. They began applying for government benefits, especially Medicare and Medicaid, to help defray the health costs of retired religious. They began negotiating for higher stipends from the dioceses who employed them, striving for parity with the salaries paid to laypeople.

They began paying retroactively into the Social Security system, so that their members could receive at least minimal retirement benefits. They began selling off underused buildings and properties. They began tapping alumni to contribute to newly established development funds. And they began putting those investments in the hands of professional money managers.

Religious communities also got a big boost from the annual collection for the Retirement Fund for Religious, begun in 1988 by the U.S. bishops. Since its inception, the collection has raised more than $529 million to help religious communities fund their pension plans.

It is the most successful appeal in the history of U.S. Catholicism, averaging between $25 million and $28 million a year. In 2006, the collection raised around $30 million. It will be held this year the weekend of Dec. 8-9.

“I firmly believe that without that collection, some religious orders would have died out, would have declared bankruptcy or would have merged with another order,” said Sister Barbara Matteson, an Adrian Dominican who serves as executive director of the National Association for Treasurers of Religious Institutes.

The association, with more than 600 members representing most of the male and female religious orders in the U.S., held its annual conference in Miami Nov. 6-9. It was founded in 1981 to help religious communities professionalize their approach to financial issues.

“We’re not depending solely on ‘God will provide,’” Sister Matteson said. “God will provide, certainly, but we have to do our part, too. So we’ve had these years to learn what we had to do.”

The association serves as a resource and networking site for those charged with looking after their community’s finances. That task is complicated by size: More than 300 of the religious communities in the U.S. have 50 or fewer members, and some of the newer communities have as few as 20.

The association is seeking to reach out especially to those smaller groups and monastic communities that may still be “working out of a checkbook,” Sister Matteson said. “We need to be organized in this so we all understand it,” especially in light of ever-changing tax laws and government regulations.

Indeed, the subject matter discussed at the group’s gathering seemed more suited to the boardroom than the convent. Workshop topics included benchmarking and monitoring investment managers, adapting investment strategies for changing times, property and liability exposures of religious institutes, and how religious institutes comply with the Sarbanes-Oxley Act.

“It’s a professional job now. It’s too complicated. There’s too much at stake,” said Sister Lichtenberg who, unlike many of her counterparts, obtained an MBA degree before taking on the treasurer’s job, which she has now held for 18 years.

In the beginning, Sister Matteson explained, treasurers were usually selected for the position because of their background as math teachers.

Sister Longo, who along with Sister Lichtenberg serves on the board of the treasurers’ association, is a nurse who obtained a doctorate in economics. Both agree that the national collection has helped religious communities survive. But they don’t want people to get the impression that it has been a panacea.

“It’s been one leg of a four-legged table,” said Sister Lichtenberg, whose community has received grants averaging $95,000 a year from the collection. By comparison, its unfunded retirement need was calculated at $20 million at one point.

“It is no longer as large as it used to be because of the collection and Medicaid for skilled care,” she said.

The collection’s goal is to help religious communities “get close to fully funded” for retirement, Sister Matteson said, which is why the bishops recently voted to continue the annual appeal. According to data gathered by the National Religious Retirement Office, of 244 religious communities that participate in an annual study, only six had fully or nearly fully funded pension plans in 1985. That number has grown to 90 today, and the number of communities that were funded at less than 20 percent has decreased from 116 in 1985 to 20 today.

“Without this collection we would be in really difficult straits,” Sister Matteson said. “Religious communities would be in an even greater crisis than when we started.”

Still, it appears that the worst is over and religious communities are beginning to focus once again on the future, Sister Matteson said.

“We have put, out of necessity, so much emphasis on retirement. Now we have to put just as much emphasis on vocations. We need to promote our life and not focus on the end of life. I firmly believe religious life is valuable for our church. We may not have as many different groups (in the future), but we certainly will have religious men and women.”

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