The Diocese of Owensboro has confirmed it is affected by an underfunded national Catholic pension plan that has raised concerns for dioceses and Catholic school systems across the country.
According to the Diocese, it was recently notified by Christian Brothers Services (CBS) that the Christian Brothers Employee Retirement Plan (CBERP) — a multi-employer church pension plan — is currently approximately 40 percent underfunded. A separate brochure from CBS indicates the plan is approximately 34 percent underfunded nationally, reflecting differences in reporting periods and actuarial assumptions.
In a statement to Owensboro Times, Diocese of Owensboro Director of Communications Rachel Hall said the plan has been used by the Diocese since 1985 and covers more than 1,500 diocesan participants, including retirees, current employees, beneficiaries, and vested former employees.
The statement said that nationwide, the CBERP serves approximately 40,000 participants across about 180 Catholic employers, including dioceses, religious orders, and independent Catholic schools.
Public reporting, including an article from the National Catholic Register, has indicated the plan faces an estimated $800 million funding shortfall, attributed to market performance, demographic shifts, and a declining number of active workers contributing to the plan.
CBS has outlined a revised contribution strategy designed to improve the long-term financial health of the plan. According to “The New Path Forward” brochure, the pension board adopted a new contribution approach aimed at closing the plan’s funding gap and reaching full funding over the next 25 years.
Under the new strategy, employer contributions would need to increase substantially to cover both the cost of benefits earned and to amortize the unfunded liability over that period, a change intended to ensure the plan’s sustainability for participants and retirees.
Hall emphasized that no final decisions have been made locally. She said Bishop William F. Medley and Diocesan leadership have begun meeting with priests, school principals, parish staff, and finance councils throughout the Diocese to explain the situation and gather feedback.
The Diocese considers honoring pension commitments a moral responsibility, their statement said.
“Our number one priority is to assure that the commitment made to our retirees and present and future employees will be honored,” said Bishop William F. Medley.
Hall noted that while national coverage has highlighted broader challenges facing Catholic institutions, the Diocese of Owensboro’s financial position is distinct from other dioceses, and decisions will be based on local conditions and expert guidance.
“This communication process, also known as Synodality (walking together) has generated constructive dialogue and allowed those choosing to participate to be part of the solution,” Hall said.
Final recommendations are expected to come from the Diocesan Finance Council and Priest Council in the coming months. The Diocese said it plans to continue communicating with employees and retirees as the process moves forward, with additional information expected in the January issue of The Western Kentucky Catholic.
