District of Eastern North America
Finance Committee
March 15, 2016
Conference Call
Meeting # 22
Members present: Br. Frank Byrne, Chair, Br. Anthony Baginski,Br. Gerard Conforti, Br. Gerard Frendreis, Timothy Froehlich, Br. Joseph Juliano, Mr. William Phillips and Br. Joseph Schafer.
Absent: Br. John Patzwall, Br. James Martino
Br. Frank called the meeting to order at 1:07 PM and offered an opening prayer.
The minutes of the meeting of November19, 2015 were reviewed and the following motion was made:
Motion: To accept the minutes of the November19, 2015 meeting of the FSC DENA Finance Committee (Phillips/Byrne) Approved unanimously.
- FSC DENA
Br. Tim reported on the DENA February 29, 2016reports. He noted that the gifts and donations account was significantly over budget due to several grants obtained by the development office, which have been restricted for retirement expenses. $800,000 from last year’s surplus was donated to the St. John Baptist de la Salle Fund. The expense accounts are all on target. Since no money has been transferred from the Endowment Trust yet, there was a brief discussion on the handling of this accumulating receivable on the books and how much is actually transferred from the Endowment each year. As treasurer for FSC DENA, Br. Tim will attempt to craft a more formalized process/approach at year-end in how this receivable is handled by the Board of FSC DENA.
- FSC DENA Endowment Trust
Br. Timreported on the DENA Endowment Trust’s February 29, 2016reports.He noted several changes on the balance sheet: A) additional CBIS shares have been purchased from the merger of the San Francisco and New Orleans-Santa Fe Districts; B) the Ocean Tides loan of $1.63 million began this past month; and C) the accumulateddrawdowns on the Ocean Rest loan now stands at $3 million. There was a question about the sale of the 3 Ocean Rest lots. Br. Gerry F. responded that we have a contract to sell the 3 lots over a 3 year period for over $ 7 million. The only conceivable impediment to the deal is if the buyer is unable to receive the same permits the Brothers received for their lot. Our professionals involved are confident the buyer will be able to receive such permits.
- Christian Brothers Retirement & Continuing Care Trust
Br. Tim reported on the Christian Brothers Retirement & Continuing Care Trust’s February 29, 2016reports.In comparison to last year, our net assets fell by $10 million from $96 million to $86 million. On a positive note,over $2.4 million in donations were receivedfrom TIAA-CREF pension fund redemptions. The professional fees account is higher due to our out-sourcing of the Medicare Part D prescription drug plan and legal fees associated with employment issues at De La Salle Hall.
- St. John Baptist De La Salle Fund
Br. Timreported on the February 29, 2016reports for SJBDLSFund. The Fund balance currently stands at $13.7 million. The spending policy of the fund allows for a distribution of over $575,000 this year. In light of the significant growth in assets of this Fund, the committee questioned whether the Fund’s Board has considered further diversification of its investments. Br. Joe Juliano will see that this topic is on the Board’s agenda for their next meeting.
- Investment Committee Update
Bill Phillips gave an oral report and referenced the minutes of the Investment Subcommittee meeting of February 19, 2016. The markets continue to be very volatile and this may continue for a while due to political and world economic conditions. The committee continues to monitor our managers as we wait for market conditions to improve.
- Fiscal Year 2017 Budget Preparations
Br. Tim presented some draft assumptions for FY 2017. The committee reviewed and affirmed the assumptions that will be implemented in the building of the FY 2017 budget.The District tax assessments are expected to increase slightly, while the FICA and retirement assessments are not projected to increase. The premiums for the District medical plan are expected to remain unchanged from this year as we await a formal announcement from Christian Brothers Services. There was a brief discussion on the amount of support for retired Brothers in community which led to a discussion on the assets that some communities hold and the purpose of these assets. An internal report on the cost of care per Brother in each community justifies keeping the current base level of support at $24,500. Br. Tim reminded the committee that communities in need of a higher level of support in the past were never refused and that he would continue to work with those communities that anticipate a need for additional support in 2017. It was also pointed out that the cost of living index [i.e. inflation] for the past year was essentially 0%.
The committee expressed its thanks to Br. Tim and his staff for their work in preparing for the meeting.
The committee consulted calendars and arrived at these future meeting dates:
Tuesday, June 21, 2016
Thursday, November 17, 2016
Tuesday, March 21, 2017
Tuesday, June 20, 2017
On a motion to adjourn (Froehlich/Juliano) the meeting ended at 1:59 PM.
Respectfully submitted,
Br. Joseph Schafer
Secretary