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Decision No. 963

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April 26 2003
In Re: Review of Bishop’s Decision of Law in the West Virginia Annual Conference Related to the Use by the West Virginia Conference Board of Pension of Funds Invested with the General Board of Pension and Health Benefits

Digest of Case

The decision of law of Bishop S. Clifton Ives is affirmed. The West Virginia Annual Conference’s deposit account at the General Board of Pension and Health Benefits is not the same account as the Conference’s pre-1982 past service funding account at the General Board of Pension and Health Benefits. Since the deposit account is not the pre-1982 past service funding account, the Conference may transfer funds from it to satisfy conference health claim liabilities.

Statement of Facts

In Decision 953, we continued this matter for consideration and deliberation of Question 1 on the decision of law of Bishop S. Clifton Ives concerning the use by the West Virginia Annual Conference Board of Pension of funds invested with the General Board of Pension and Health Benefits. In order to pay health claim liabilities of the Conference, funds were transferred from an account held by the General Board of Pension and Health Benefits. Two retired clergy members of the Conference submitted questions of law to the bishop relating to the legality of the transfer. They claimed the funds transferred were from the Conference’s Past Services Funding Account and thus could not be used to pay Conference health care claims. Question 1 asked, “n the light of the provisions of the Discipline and the Judicial Decisions sited, (sic) did the Board of Pensions have the authority to transfer these funds?” The bishop ruled, “[y]es, the Conference Board of Pensions under the authority granted to it in ¶1507.3 acted within the authority granted to it by The Book of Discipline.” In Decision 953, “the bishop [was] directed to provide to the Council any and all documents that establish the account in question held by the General Board of Pension and Health Benefits, copies of the 2002 conference journal and any other documents that distinguish the conference’s deposit account and the pre-1982 restricted account relative to the transfer of funds to pay health care claims.” The documents directed to be produced have been received. Jurisdiction Jurisdiction on Question 1 was retained by the Council in Decision 953. Analysis and Rationale The bishop’s decision on Question 1 is affirmed. A wealth of documents has been received which allows this Council to determine the identity of the deposit account in question. The documents reflect that the deposit account is not the pre-1982 past service funding account. The deposit account is the conference “checking account” maintained by the General Board of Pension and Health Benefits through which the conference pension plan makes deposits and payments. A separate past service funding account is held by the conference and maintained by the General Board of Pension and Health Benefits. While the deposit account is the reserve for the past service funding account, it does not have the restrictions imposed by ¶1506.8 of the 2000 Discipline. Paragraph 1506.8 says pre-1982 pension funds are “protected for the exclusive purpose of retiring…pre-1982 pension obligations.” The deposit account does not have this restriction and funds could be transferred from it to meet conference health claim liabilities. However, once funds are transferred from the deposit account to the pre-1982 past service funding account, they cannot be used for any purpose other than pension payments for pre-1982 service.

Decision

The decision of law of Bishop S. Clifton Ives is affirmed. The West Virginia Annual Conference’s deposit account at the General Board of Pension and Health Benefits is not the same account as the Conference’s pre-1982 past service funding account at the General Board of Pension and Health Benefits. Since the deposit account is not the pre-1982 past service funding account, the Conference may transfer funds from it to satisfy conference health claim liabilities.

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