Our Catholic Journey May-June 2011

Official Publication of Catholic United Financial

May/June 2011 Vol. 116 Issue 3

12,000+ new members?!

How we’ll do it this August...

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Raffle money in action Schools put $345,000 to work

Path to + The Councilhood

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Keys to Your Kingdom with John Tetzloff

From the President

“...We must constantly be vigilant to opportunities as they present themselves. In essence, we need to push the envelope...”

As you read this issue of Our Catholic Journey, you will see several references to our announced merger with American Fraternal Union. I suspect there will be many questions that will immediately come to mind. These questions will need to be answered to your satisfaction because at the 2011 August Annual Convention of Catholic United Financial, our delegates will be asked to vote to allow the merger to go through.

The first questions may be, “Why a merger? Why now?

And how will this affect us?” All legitimate thoughts that deserve an answer. So, in this Journey column I will attempt to dispel any fears you may have and reassure you that this merger is a good move for all involved.

Over the past several years, our Home Office mode of operation — our work, our progress and our thinking — has all revolved around doing what we do better each day. Our mantra has been to constantly strive to improve ourselves in every way. This is an admirable goal and we work hard to accomplish it. Recently, actually over the past few years, we have come to the realization that we need to expand and grow internally as well as externally to survive and prosper into the future. If we are to better serve our members, we need to have measured growth through strength and always keep our ultimate mission of promoting our Faith as our guide in this journey. Remember, our mission starts with the phrase, “Bound by our Catholic Faith.” We also need to be the “provider of choice in contributing to the financial well-being of our members; and be a visible leader in support of our Catholic Communities.”

To accomplish this task, we must constantly be vigilant to opportunities as they present themselves. In essence, we need to be pushing the envelope; we need to expand our minds and our perspective as they pertain to our future. An acquisition like the one we are announcing

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this month is just the tool to begin that journey.

Why now? There are several answers to this question: We are well-positioned for growth today. Our staff is up to the challenge. We need the practice if another opportunity of more significant size comes along. The American Fraternal Union (AFU) has a similar historical fraternal perspective, and they are based in Minnesota. AFU is an adequately financed fraternal with problems we can easily absorb or solve.

Historically, the American Fraternal Union had, and still has, a strong link to our Catholic Faith. And finally, they are interested in joining our great society.

Add to this the fact the State of Minnesota Commerce Department heartily endorses this move; while our national trade association, The American Fraternal Alliance, is excited by our display of leadership in the industry, you can see how the pieces have fallen into place for this merger. This is the right time and AFU is the right company to help us provide even stronger confidence and leadership for our members and our industry while insuring the future growth and stability of Catholic United Financial.

There were two concepts in this agreement however, that neither I nor the Board was willing to compromise on. The first is regarding our current constitution.

There will be no changes or additions. It will remain as it has been written. Second, and most importantly, we will not compromise our Faith or our membership.

American Fraternal Union members will become our members, and — based on our constitution — individuals will either become benefit members or limited members. I know this is as important an issue to you as it to us, and so we have taken care to protect our contract with you, our constitution, throughout our negotiations. The AFUBoard is in agreement with our position on these matters and has expressed excitement in the joining of these two historic societies.

I urge you to take a close look at the article on page 12, and the Question and Answer section that accompanies it, to get a true flavor of where we are going and how we hope to get there.

May the Lord bless you all in every way,

www.catholicunitedfinancial.org

Contents Features

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12

Path to Councilhood

Six new councils have been chartered since the beginning of 2010. Learn why this trend is so beneficial to school, parish and community.

Raffle Money Applied

So what exactly do your local Catholic schools do with almost $345,000 raised in this year’s Catholic Schools Raffle? Find out!

Merger Announced

12,000+ new members could soon be joining Catholic United Financial, after the announcement that we will merge with the American Fraternal Union.

Departments

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15 16

Sales News

Let’s review what we do; and get to know our most senior sales representative, Gary Gall.

Keys to Your Kingdom

Estate planning advice from our estate planning guru, John Tetzloff.

Sections

12 On the Cover

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Scrapbook

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Memorials

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Official Publication of Catholic United Financial

May/June 2011

Read news tidbits and see member photos.

In loving memory of our deceased members.

Youth

Catholic United youth receive recognition from Degree of Honor’s Salute to Youth program.

Vol. 116 Issue 3

Photo: Bob Pearle Photography

The Gieske girls, part of a Catholic United family, take a ride in the sun on their way out to the fields of their farm in Melrose, Minn.

news@catholicunited.org

Back cover

How we’ll do it this August.

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Raffle money in action Schools put $345k to work.

path to + The councilhood

Publication No. 093500 Official Publication of Catholic United Financial

Constitution Committee Report

12,000+ new members?!

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Keys to Your Kingdom with John Tetzloff

SFI-00574

Catholic United Financial President/Chairman Michael F. McGovern, Northfield Senior Vice President and Secretary/Treasurer Harald Borrmann, St. Paul Board of Directors Lead Director Frances M. Barten, Union Hill; George Gmach, Rogers; Joseph F. Kueppers, Mendota Heights; John W. Maile, Cold Spring; Deborah M. Pauly, Jordan; Robert Krattenmaker, New London; Michael Schmitz, Mankato Magazine Staff: Publisher Michael F. McGovern Editor Jared Roddy Staff Susan Detlefsen , Michelle Clark Director of Marketing Steve Wendorf Office of Publication: Catholic United Financial, 3499 Lexington Ave. N., St. Paul, MN 551268098; 651-490-0170 or 1-800-568-6670. Postmaster: Send change of address notice to above.

Periodicals postage paid at St. Paul, MN. Subscription price is 50 cents a year.

Published bimonthly.

May/June 2011

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Scrapbook

Zimmerman Chainsaw Pastor!

Fr. Kevin (with chainsaw) went straight to work last JOIN HANDS DAY, hacking limbs and severing ... well, branches off dead trees for the beautification of his parish. Catholic United members Jackie Slayton, Annette Swirtz, Annette Thielen, Carol Vantassel (below) and others helped with cleanup and other projects. Officially, JHD was May 7, but councils can get credit throughout the year.

All Smiles at Unveiling

After two years of construction, the new addition to St. John the Evangelist School in Duluth, Minn., was unveiled and blessed in early March. Catholic United Financial was proud to support the building with a capital improvement grant.

From Left: Fr. Richard Kunst, Bishop Paul Sirba, Sales Rep Mike Kirchhoff and Principal Peggy Frederickson.

The Verdict: do it again next year!

They say the cutest things...

Above, students from Yankton, S.D., advertised for their Project Multiply, baking and selling cookies. They raised more than $3,000! Right, students of St. Isidore school in Owatonna, Minn., use their best cursive to thank the Foundation for a Technology Grant.

As any politician should tell you, listen to what your constituents say! That’s what the St. Martin’s Council of St. Martin, Minn., does every year with its annual Halloween party and haunted house. The event takes a month to prepare for and is the most requested activity the council puts on. They also have a summer picnic every june, with activities for kids like the ring toss, pictured here (middle).

Keep those photos coming in, councils!

Tentative Annual Convention Schedule Posted

Visit www.catholicunitedfinancial.org/links/convention to see this year’s schedule

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www.catholicunitedfinancial.org

How to Contact your Sales Representative: Look on the back cover of this magazine. Your Sales Representative’s name and contact information should be listed with yours. Or, visit www.catholicunitedfinancial.org, or call 1-800-568-6670.

Swimming Against against the current Current

St. Joe youth group “Upstream” shares their time and talent with those less fortunate

When the youth group, Upstream, made their presentation to the St. Joseph Council of Waconia, Minn., last year, the council did what anyone who is used to dealing with teenagers does — it opened up its wallet. Although in this case, it was to support the mission trips Upstream participates in through Catholic HEART Work Camp. During the trips, they are assigned to teams with youth from all over the U.S., and work in senior homes, food shelves and other places where volunteers are needed. Having already been to Green Bay, Wis;, Champaign, Ill., and Billings, Mont., they plan to visit Kearny, Neb., this year to continue their work with the less fortunate. “It is so amazing what can happen when a group of teens gets totogether to help serve people who they have never met before,” wrote Allison Klein. “I am so blessed to have been given the opportunities to go on these mission trips.”

App up!

Supplied and unplanned

The St. Joseph/St. Ann’s Council delegates of Aberdeen, S.D., didn’t even wait to get home from the 2010 Annual Convention to plan their next activity — providing school supplies for local Catholic Schools.

When they learned the school needed markers and glue sticks, the council bought a set of both for every student at Holy Cross school in Ipswitch, S.D. Above: Sandy Andera of Roncalli primary school and Fraternal Secretary Len Diebert divvy up the goods.

“Patron Saints and Candles”

App by Dominic Romano Have a question about your favorite saint? Want patronage or date. Light a candle (virtually), look up to see who else is thinking about St. Theo at the your saint’s bio and prayer, and email the saint and same time? Or feel like sending a prayer to a friend? candle to a friend or relative to let them know they’re in your prayers.

Patron Saints and Candles app for Probably the coolest feature, the iPhone ($1.99) celebrates the see where top 75 Patron Saints with individual else in the bio info, classic Old World world people artwork, and are lighting traditional prayer pages. candles for the same You can look up saints by saint. their name,

news@catholicunited.org

May/June 2011

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You can spot and stop identity theft

By Terri Maloney President Financially, there’s almost no worse feeling than having your identity stolen, and watching a thief squander your hard earned money and credit. This happened to me several years ago, and I wanted to let you know how you can recognize the signs and take steps to fix the problem if you suspect your identity might have been compromised.

The keys to taking back your good name are to notice the theft quickly, reject the fraudulent charges, and protect against future fraud.

Know the signs.

The first sign of an ID theft may be receiving statements for an unknown credit card account. Expected bills may not arrive. You may get phone calls about unknown purchases. You may get an unexpected credit denial.

Ask for a fraud alert.

If you suspect fraud, alert one of the credit reporting agencies (listed at end of article), and ask for a “90-day fraud alert” on your

name, which will require financial firms to get extra identification from applicants. Eventually, a sevenyear version of the same fraud alert may keep you safer in the future.

Close compromised credit accounts.

Confirm the action by mailing the Federal Trade Commission’s “Identity Theft Victims’ Complaint and Affidavit” form for each account. Search for the form and more information at www.ftc.gov.

Take good notes.

At every step, pay attention to detail and remember that businesses and agencies may want to see paper or electronic files. For each contact, record the name of the person you spoke with; the date and time of the conversation; the address, phone number, and full name of the business; and what was discussed.

Follow-up.

Send all important correspondence via registered mail, with return

receipt requested, and send copies, not originals. Keep the paperwork on hand for several years. Once you and a creditor have settled a claim, ask the firm to mail a letter confirming that the matter is settled.

This letter is your best protection if the same phony claim reappears.

Resources

* Identity theft protection and survival: identitytheft.org * Federal Trade Commission Identity Theft Web site: ftc.gov/bcp/edu/microsites/idtheft/ index.html * Credit reporting agencies: Equifax: www.equifax.com Experian: www.experian.com TransUnion: www.transunion.com * Free annual credit report www.annualcreditreport.com Note: The Fair and Accurate Credit Transactions Act (FACT Act) of 2003 requires each major credit bureau to provide one free credit report annually to consumers who request a copy.

Refinance an auto loan this summer

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*Refinance offer does not include existing credit union loans. Rates subject to change.

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May/June 2011

*Refinance offer does not include existing credit union loans. Rates subject to change. www.catholicunitedfinancial.org

Foundation

Biggest Tournament yet!

More than $27,000 raised It’s with bittersweet satisfaction that I report the successful conclusion of the 13th Annual Foundation Golf Tournament. As is the case every year, the real winners are the schools and religious education programs that will benefit from the funds Paul Naumann raised by this event. Unlike Executive Director years past, I know I won’t be at the helm for next year’s tournament so I’m proud to report this was our most successful one yet. Great to leave on a positive note!

The tournament took place at River Oaks Golf Course in Cottage Grove, Minn., on Monday, May 23. A major part of our earnings came thanks to our two tournament sponsors, Preferred One and 21st Century Bank, as well as our other major sponsors: Stearns Bank; Leonard, Street and Deinard; and Wells Fargo Institutional Trust Services. But the contributions from our other sponsors, silent auction donors, golfers and volunteers cannot be understated. All told, our net profit this year was $27,501. As always, 100 percent of this revenue goes to our grant-making.

Since the Foundation was created in 1997, we’ve awarded more than $411,000 to our priority funds – the aforementioned priorities as well as disaster relief.

I want to take this opportunity to thank all those who have helped throughout the years to make this event so successful, rain and shine (and we’ve had both!) year after year. It’s been the highlight of my year each of my years as executive director, to put this tournament together and see all our supporters come together to support such an important cause. It’s been a great pleasure.

And I’ll take one last opportunity to remind you of the ways you can help our Foundation.

We now have at least three major ways that you can get involved, with emphasis on different aspects of our mission to match your preference.

Thank you for your support. If you have any questions or would like to participate in any of the above programs, contact us toll-free at 1-877-275-7145, or locally at 651-765-6548. news@catholicunited.org

Thank You Donors & Sponsors 21st Century Bank Preferred One Stearns Bank Leonard, Street & Deinard Wells Fargo Institutional Trust Services Catholic United Financial Heidorn Consulting, Inc. MECA/SAMCO Sportswear Inc. Zeman Construction Mike and Ann McGovern Relevant Radio Business Data Records Kathy Hemmelgarn, Foundation Director Tom Schisler Optimum Re-insurance Flip Spanier Director George Gmach Director Deb Pauly Jim Gibbons St. Elizabeth Ann Seton Council Hastings, Minn.

St. Mary’s Council St. Augusta, Minn.

Our Lady of the Lake Council Grove City, Minn.

Stifels Nicolaus Henry Hanton, Incentive and Meeting Management Advantus Capital Securian Retirement Services Denny Olson

Our Lady of the Lakes Council Spicer, Minn.

St. Mathias Council Hampton, Minn.

St. Lawrence & Ann Council Faribault, Minn.

Roger Bauer Catholic United Financial Credit Union St. Peter & Clemens Council St. Paul, Minn.

Deb Gephart Catholic United Financial Employees Paul Naumann RGA Reinsurance Co. Superior Shores Resort Arrowwood Resort Delta Dental University of MN Sports Holy Family Council Rochester, Minn.

Vinaigrette The Minnesota Twins Harald Borrmann Liturgical Publications, Inc. St. Paul Saints Crowne Plaza Plymouth Angie’s Kettle Corn Elmer Heirigs/Robert Hinton Mary Froberg Pat Brown Denise Degerstrom

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Which way...?

A trail guide to becoming a council In Major League Baseball, 2010 was “the Year of the pitcher.” In technology, it was “the Year of the tablet.” For Catholic United Financial, 2010 was “the Year of the New Council.”

That’s because in 2010, five new councils were chartered for Catholic United Financial, and a sixth in West Fargo, N.D., was well underway to receiving its charter in February of 2011. To put that in perspective, only four councils had been chartered in the prior five years.

There’s something special when a group of Catholics come together to support the youth of their parish, and the future of the faith, which is essentially what chartering a council in your parish does. With all these new councils popping up, the question arises, what does the parish stand to gain? And how does a parish without a council go about starting one?

Benefits for the future of the faith

Dad, Derrick Wotachek, and boys, Nolan and Blake of Cambridge, Minn., are members of the Immaculate Conception Council in Pine City, Minn., but not everyone is so fortunate. Some members attend parishes without Catholic United Councils. See the benefits of having a council at your parish, and how to get started.

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According to Fraternal Director Kathleen Moriarty, a council brings three main benefits to a parish: increased fundraising for education and parish needs; added volunteerism among parishioners and vehicles to promote it; and spiritual strength brought on by service for a shared faith and sense of purpose.

A council is at its core, a group of Catholic United members who are dedicated to supporting the religious education programs and faith formation of their parish. You are probably familiar with

fundraising efforts like spaghetti dinners and fish frys during Lent.

What you may not know is that if you’re putting on events like this already, you could be missing out on significant fundraising opportunities.

“Local councils are the lifeblood of fraternalism,” says Moriarty. “We want more councils because we are committed to giving money to these parishes, and we do that through the council system.”

Although some programs such as Ministree, scholarships and limited matching grant funds are available to any parish where Catholic United members participate, only councils can receive the full suite of fraternal benefits.

Bea O’Brien, Treasurer of the Sacred Heart Council of Waseca, Minn. (chartered November 2010), says they were convinced to pursue councilhood to help their school.

“There were advantages for the youth,” she says. “And, of course, we have the school here, so we knew there would be some definite benefits if we could get [a council] established.”

An example of those benefits is the Matching Grant Program, which many parishes — including Sacred Heart — participate in without a council. But when a parish group of Catholic United members puts on a Matching Grant event, www.catholicunitedfinancial.org

Catholic United Financial will match 25 percent of the first $2,000 raised – a $500 maximum. A council receives up to $1,000. Councils also receive an activity allowance based on adult members on the roster, a stipend for the fraternal secretary, access to youth programs that match funds and pay out activity allowances, and delegates to the Annual Convention.

Fraternal Secretary Miriam Johnson of the April 2010-chartered St. John Bosco Council in Pipestone, Minn., agrees.

“The biggest advantage to having a council has been the amount of money we’ve been able to raise for our youth,” Johnson says. “It’s doubled and it doesn’t ask that much more of us. We meet four times a year and put on fundraisers, and we do that anyway. So it’s not been that hard on us.”

Road maps and shortcuts

Every council develops in its own unique way. But if you’re interested in starting one for your parish, Moriarty says the first thing members need to do is approach their Sales Representative. “Sales Rep involvement is paramount,” she says.

Once the Sales Rep is enlisted in the effort, and there are ten or so Catholic United members behind the effort, the fraternal department should be contacted. It will determine whether or not the building blocks of a successful council are in place.

“Is there good activity among the parish and a response to previous fundraising needs?” asks Moriarty.

“Does the pastor or school principal support the group, and is there growing membership in the area?

These are the components we look for when we charter a new council.”

These are just guidelines, not rules. In O’Brien’s case, the effort to start a council had been ongoing, and the Sales Rep Mike Matuska actually approached her. Johnson

also said in their case, the parish priest prodded her to action.

“Fr. Kosse came to me and asked if I knew anything about Catholic Aid — it was called Catholid Aid at the time — and I said I knew a little,” Johnson says. “He gave me the lowdown and said ‘I’d really like you to head something up, I think we need to bring it into the parish.’”

She contacted the Fraternal Department herself to get the ball rolling, and they sent Sales Rep Dan Markell to visit her. Finding enough members was their biggest challenge.

“That was the hardest part,” Johnson said. It came down to ‘Can we find enough people to become members?”

The Johnsons joined Catholic United that night, and referred several friends who they thought would support the effort. Turns out, they were right.

“We’ve got four children and we know a lot of people with a lot more.

Anything we could do to benefit our youth in our parish. That’s our future and we need to pass on the faith; that was our big motivation,” Johnson says.

Keep some gas in the tank There is another guideline of having a 30-member minimum to begin a council. From this, the various officer positions within the council can be filled. But one of the keys to sustaining a council is, predictably, more members.

“If there are only ten members and they’re all officers, then they end up doing everything,” Moriarty says. “We really like to see more members there to support the officers with the various projects the council undertakes, so people don’t burn out.”

Since councils are run independently, with their own bylaws and budgets, there is a great deal of dependence on the individual officers. Along with providing funding, the Fraternal

Department, Moriarty says, offers training, listens to and disseminates ideas for activities, helps with publicity for events and recognizes achievements.

Adding or involving more members is a challenge not only for the councils, but for fratenals as a whole.

“People have many demands on their time and we are grateful for their involvement in the council at any level, Moriarty says.

Catholic United, she says recognizes the challenges faced by councils and says she commends them for the amazing amount of work they do.

“We recognize that parishes and schools are changing, and we’re committed to work with our local groups to reflect those changes, whether that’s through increased emphasis on volunteerism, more outreach to new members or recognizing local needs specific to the communities. We’re dedicated to being a significant part of their efforts.”

In Waseca, council officers and members have a primary goal of continuing the tradition of their tuition-free Sacred Heart school.

“There are some of us who are grandparents to kids going there, and we were parents to kids going there 25 years ago,” O’Brien says.

“We want to see it continue tuitionfree, and we want to keep it there.”

Johnson said her Pipestone council also likens its purpose to providing for the future. Spreading the word about their activities, she says, should encourage more members to get involved.

“Most people — I really believe — if they knew that we were here, would see there aren’t a lot of places like this, where the money all goes to “good.” It’s all about passing on the faith, that’s our whole goal. I think about what my parents did, passing the faith onto 13 of us, and any more that we can pass it along to is amazing. That’s why we’re here.”

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Where does the money go?

Field trips, technology and tuition assistance top the “want lists” of schools that participated in the Catholic Schools Raffle earlier this year. Each of the 46 participating schools has a need that will be met thanks to the $344,900 raised by the Raffle.

Did you grip your Catholic Schools Raffle ticket just a little tighter when you imagined winning one of the 24 prizes? Did the anticipation of winning an iPad, a laptop or even the grand prize of $25,000 make you excited for the March 10 Drawing Ceremony? If so, then you know how some school administrators feel now that they have the funds from the raffle to spend on the needs of their schools, students and teachers.

After we contacted school principals and administrators, three needs were most often mentioned regardless of school location or size of student body: student tuition support, classroom technology and educational trips beyond the classroom.

Maria Heymans-Becker, principal of Mary of Lourdes School in Little Falls, Minn., said a portion of the $23,495 the school raised through the raffle will be allotted to an existing tuition assistance fund.

“We established the ‘Support a Student’ scholarship fund so all

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money that goes into the fund benefits our families who are in need of tuition assistance. Our home and school association has always supported that fund. Since we did so well with the Catholic Schools Raffle, it was very easy to put more toward ‘Support a Student’ this year,” said Heymans-Becker. “Our families say that without that tuition assistance fund they know they could not afford to send their kids. I hear that a lot when they get awarded some scholarship funds.”

Principal Nicole Belpedio of St. Peter’s School in Delano, Minn.said the more than $3,000 her school raised will be spent on tuition assistance. She estimated that 17 percent of the students who attend St. Peter’s receive assistance from the fund and that the raffle was a big support to that cause.

Principal Carol DeSmet of Holy Redeemer School in Marshall, Minn., said that the school will spend the majority of the money they raised on physical improvements to the school, including moving the main office to a new location in the building. The aim of the move is to improve school security.

The remainder of the money will provide Holy Redeemer students the

opportunity to attend classes at Camp Foley. Foley Environmental Education Center, outside of Pine River, Minn., is a grand adventure for elementary-age children, with classes that introduce children to animals of all kinds, geology, tracking and the joy of the outdoors.

Without the raffle funds, the school would “do without” these field trips and capital improvements, said DeSmet via email.

Heymans-Becker said every single class at Mary of Lourdes, preschool through grade eight, will benefit from at least one educational field trip, thanks in part to the funds raised by the raffle.

“Some of the field trips are going to the Stearns County Historical Society Museum, or the Lindbergh State Park, or the Pine Grove Park Zoo,” said Heymans-Becker. “We try to support our local museums and establishments because

www.catholicunitedfinancial.org

a lot of our kids don’t go to those local things.”

St. Michael’s Lakeside School of Duluth, Minn., has a fundraising budget of $100,000 earmarked for a potpourri of needs: educational materials, technology support, buildings and grounds projects, and tuition assistance. The more than $6,000 raised by the Catholic Schools Raffle will be added to the budget and distributed as specific needs arise. The school’s two-year fundraising total is more than $12,500.

“We love this particular program because it is well done and very easy for us to implement,” said Principal Amy Flaig of St. Michael’s. This was the school’s second time participating in the raffle. “We also value our partnership with Catholic United and desire to continue that.”

Keeping up with educational technology is something that every school has to contend with, and raffle funds are helping schools keep pace. Principal Jody Stoffels of St. Anastasia School in Hutchinson, Minn., said that since the raffle the school has been able to purchase SMART Boards for their fifth- and sixth-grade classrooms. “We’re still in the process of wiring them,” said Stoffels.

Think of a SMART Board as a whiteboard-sized touch screen monitor, or a six-foot-long tablet computer. Connected to a computer and a projector, a SMART Board allows students to interact with content that is projected onto the screen with a simple touch of a finger or hand gesture. Specialized stylus “markers” allow students to write on the board in different colors. Each mark made can then be captured, saved in a computer file, and projected at a later date or printed.

Specialized curricula exists for

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SMART Boards on nearly every topic taught from kindergarten to twelfth grade. The hot technology is becoming ubiquitous in schools across Minnesota and Catholic schools are hopping on board.

Stoffels said her teachers use the SMART Boards “to teach just about every type of class. There are lessons that come with it, and ones you can devise yourself with different curriculum that provides visual aids for the students, and allows them to get up there and interact with the media. The teachers devise lesson plans that come with our reading series and math series and science and social studies. [SMART Boards] usually reinforce things that they are already teaching, but it gives the kids extra practice or a new dimension to what they normally learn.”

Getting SMART Boards “allows us to remain competitive with the schools around us. All the schools in Hutchinson are getting them at this time, and it’s something that the kids like. Our diocese has recommended that we keep up-to-date with technology,” said Stoffels. “I think we’re probably equal with what [the public schools] have. We’re cooperating with them. They provide training for us and they’re very helpful for us.”

St. Anastasia’s SMART Boards have actually helped to bring the outdoors into the school.

“One of the things all the classes have been interested in is there are some eagles nesting in Iowa and eagles nesting along the Crow River here in Hutchinson,” said Stoffels.

“We’ve been tracking them and watching them hatch and develop from the eggs. That’s been pretty fun for them. Following that up we’ve had somebody come out with a live eagle. We got to name the eagles and that was really kind of neat.”

These and many Catholic students are able to keep pace with their public school peers, thanks to the Catholic Schools Raffle fundraiser.

“It’s a natural thing to want to be up-to-date as possible in technology,” said Stoffels. “Our kids all go to the [public] middle school. When they get over there, we want them to feel comfortable with the technology they’re going to be using.”

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Catholic United Financial announced May 17 that it had come to an agreement with the American Fraternal Union to merge into a single organization.

Prepare to merge On an otherwise uneventful Tuesday in May, senior management of Catholic United Financial called all employees to the auditorium for a special presentation. With no knowledge of what was in store, staffers whispered and waited.

Managers entered silently together, taking their seats without a word. After a few more minutes, company officers Mike McGovern and Harald Borrmann came into the room and took their places behind the podium. No one spoke while a Power Point presentation was prepared. Perceiving the uncertainty in the room, McGovern lightened the mood: “It’s nothing bad,” he said with a chuckle.

After a nervous round of laughter, McGovern made the announcement: Catholic United Financial was announcing an agreement to merge with a small fraternal from Ely, Minn..

The American Fraternal Union (AFU), our partner in this merger, is a 113-year-old fraternal of SlovenianCatholic origin. The boards of directors of both companies have approved the final merger document (available for review at www.catholicunitedfinancial. com/links/merger), and will recommend that the membership of each respective society vote to adopt the agreement. For Catholic United, that decision will be made at the Annual Delegate Convention, August 6, 2011, at St. John’s University.

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It all began...

It has often been discussed by McGovern and Borrmann, through their reports at past conventions and within the pages of this publication, that the Association was open to acquiring or merging with another fraternal if the right opportunity came along.

President of the American Fraternal Alliance, Joe Annotti, has stated the need for fraternals to combine to protect the smaller societies and to strengthen the larger. Jaki Gardner, assistant commissioner of Financial Institutions – Insurance/ Actuarial at the Minnesota Department of Commerce expressed a similar sentiment.

“This will make a stronger society, financially and membership-wise,” Gardner says. “Because one fraternal is unfortunately declining in members, the only way they can continue to compete is to combine to strengthen their numbers. This [merger] gives them an opportunity to do that.”

The process began in April, 2010, when AFU contacted Catholic United to express its interest in pursuing a merger. By May, a confidentiality agreement was signed.

Throughout the summer, the Board and officers did their due diligence, determining compatibility, financial solvency, and pension obligations. After www.catholicunitedfinancial.org

more than six months of research, the Board concluded that AFU was financially sound, and philosophically compatible with Catholic United’s mission and vision: the merger should be pursued.

Meanwhile, the AFU board had reached the same conclusion. But the final hurdle of the Department of Commerce remained. Through March and April of 2011, the state evaluated the transaction. Despite the reputation that state departments have for “red tape,” Borrmann says the state wanted the merger to succeed.

“In this case, we had a willing partner in the State of Minnesota,” Borrmann says. “AFU is financially sound, but too small to grow. Catholic United is fraternally minded to help, when we can, in situations like this.”

Gardner agreed with Borrmann.

“We think fraternals are a critical part of the community and provide a great service,” she says. “We don’t want to see them fall by the wayside, we want to see them continue. This shows how they step up to help each other.”

The state approved the merger and, after receiving the green-light, Catholic United released the story to its employees and the press, receiving attention in the St. Paul Pioneer Press, Minneapolis Star Tribune as well as in the national media.

Mutually beneficial...

According to McGovern and Borrmann, the Board of Directors has fielded several offers from other fraternals in the past three years, but had never found the right fit. However, it is the Board’s duty to be ready to respond when the right opportunity comes along.

“We have to take advantage of opportunities as they

Q&A

arise,” Borrmann says. “AFU is financially sound and yet the right size to absorb, we’ve got the staff right now who are up to the challenge, and this agreement will be mutually beneficial for our members and theirs.”

AFU Secretary/Treasurer Brenda Jankowski, serving as the first female in that role in her organization’s history, and overseeing most dayto-day business for several years, played a major role in positioning AFU for the merger.

“From the viewpoint of a small fraternal,” she says, “it’s very difficult to make the necessary changes that need to be made to your business, so combining with a larger fraternal is a very good solution for us.”

A principal concern was philosophically combining the two entities who were created to tie people of ethnic, religious and professional backgrounds together. Gardner says this has been a major roadblock in many attempted mergers.

“The challenge for fraternals is they all have different common bonds, and those bonds are sometimes not common enough,” Gardner says. “They can present a barrier to combining their resources.”

In the case of the Catholic United-AFU merger however, the Boards realized that the two organizations share similar backgrounds: Catholics, working in like trades, from their own specific old-world homelands, banding together to protect each others’ families. In Catholic United’s case, most were farmers of German-Catholic origin; in that of AFU, Slovenian-Catholic miners. Though AFU had ceased to require their members to be Catholic, many still are. So when the merger is finalized, Catholic United stands to gain approximately 12,000 new members overnight. Those who are not Catholic,

Continued on p. 14

Catholic United Financial/American Fraternal Union Merger

What will happen to the Catholic United Financial name and organization?

to explore all avenues for growing our business. This includes hiring more Sales Reps, broadening our product portfolio, consideration of new marketing territories and mergers.

The governing rule for any merger opportunity is that it must be in our members’ best interests.

The opportunity should enhance the value of our Association.

Catholic United Financial will be the surviving society with our home office in St. Paul. AFU’s members and insurance policies will be absorbed by Catholic United. Our Constitution will not need any changes; it was written in anticipation of such events

Why are we doing this at this time?

Our Board has always directed us

Although we were not actively seeking a merger opportunity, our Board and Senior Management

Why are we interested in a merger?

news@catholicunited.org

have fielded several merger inquiries in the past three years.

The previous situations were not clearly enough in our members’ best interests.

AFU management came to us with this potential opportunity. It is important that your Senior Management team and Board are prepared to respond to opportunities as they emerge, and so action was taken in this case.

Will AFU members become members of Catholic United?

Per our Constitution, Catholic

Continued on p 14 May/June 2011

13

Q&A

Catholic United Financial/American Fraternal Union Merger

Continued from previous page AFU members will become Benefit members of Catholic United.

Per our Constitution, nonCatholic AFU members will become Limited Members.

When do we anticipate this merger actually taking place?

Both Boards have agreed to a Merger Agreement, and the Agreement has been agreed to by the Minnesota Department of Commerce.

Both societies’ members must vote on this merger, per Minnesota statutes.

We will have our members vote at the Annual Delegate Convention on August 6, 2011.

AFU’s members are expected to vote via written ballot between now and then.

Following both members’ affirmation of this merger, an Integration Plan will be developed and implemented during August and September, in

anticipation of an October 1, 2011, effective date of a combined society.

It is important to remember that no real integration or sharing of information can occur until the memberships have voted in favor of the merger.

AFU’s members and insurance policies will be absorbed by Catholic United.

Our Constitution will not need any changes; it was written in anticipation of such events.

Will there be a branch office in Ely?

AFU’s office will remain open at the time of the merger.

The continuation of that office will be addressed as the Integration Plan is developed.

How will this merger affect our Fraternal Programs?

We expect to continue AFU’s Scholarship program for the time being.

AFU’s members will become eligible for the Catholic United fraternal benefits.

Will AFU members be eligible to be members of the Catholic United Financial Credit Union?

Yes, upon becoming members of Catholic United Financial.

Will we be expanding our sales territories as a result of this merger?

We will address this decision as the Integration Plan is developed.

What will happen to the AFU Board and employees?

The AFU Board will serve for two years as an advisory Board to the Catholic United Board, consulting on fraternal matters.

The AFU employees will be designated duties as a part of the Integration Plan (which is yet to be completed).

Prepare to Merge, continued from p. 13 will remain “limited members” as our Constitution already outlines. All contracts and policies will remain fully backed by Catholic United Financial.

AFU was also well-run financially.

“When we examined their books, we found that their investment strategy was almost identical to ours,” Borrmann says.

As such, the $23.4 million in assets and $1.17 million surplus will be rolled into our balance sheet. We will likewise absorb the $53.2 million of life insurance in force.

What comes next...

For Catholic United members, nothing should change. The name of the new combined company will still be Catholic United Financial. In many ways we are moving to absorb this society in order to continue to provide support for its fraternal members.

AFU’s Board will remain active in an advisory role

14

May/June 2011

to our Board for fraternal activities for two years.

Catholic United will benefit from more members, increased assets and increased surplus. AFU’s members benefit from increased fraternalism available through our councils and Fraternal Department. Furthermore, the fraternal system is buoyed by the consolidation of two organizations into a stronger whole, with no loss of service, protection or support for any members.

Jankowski expressed happiness that her timehonored fraternal was able to make this decision from a position of strength with a partner of its choosing. “We are most proud to say that our decision to merge was an independent one and done for strategic purposes…Having the occasion to do so with such a well-respected organization as Catholic United Financial, one that shares our principles and values along with a closely related foundation — the Roman Catholic faith — is a privilege.”

www.catholicunitedfinancial.org

Sales News

You know Catholic United Financial is a safe and secure financial institution. In our last issue, we published our balance sheets, and in this edition, you see that we’re merging with another fraternal and taking on their assets, members and contracts.

What you might have forgotten is why we are here, and why the need for our products is as great as it has ever been.

Catholic United Financial was created to offer life insurance products to Catholics, and to support the church and religious education with the proceeds of those life insurance contracts.

Life insurance is, as our spiritual director Rev. Msgr. James Habiger has said, a blessing to the ones we love and an important part of providing for our families.

It’s frightening and uncomfortable to think of our children growing up without us. But life insurance is how you can embrace them and comfort them after you are gone.

When we consider the wrenching change and upheaval that comes with the death of a family member, we should think of life insurance.

Not as a financial product, but as a moral obligation.

Five facts and one fiction about

Gary Gall Senior Sales Rep

1.

2.

3.

4.

5.

6.

HEL my n

LO

ame

is

Gary Gall has more years in the field than any Sales Rep on Catholic United Financial’s current force. Well! You think you know a guy, right? Life isn’t all about work as you’ll see from Gary’d admitted hobbies. See if you can figure out which of these “facts” is actually a fib!

His favorite hobby is fishing, from the boat in the summer and on the ice in the winter...but he is allergic to fish and can never eat anything he catches!

Some people garden, Gary raises exotic pheasants and chickens for backyard fun.

In 6th grade, he became chess champion of St. Peter School, beating his future regional manager, Pete Spaniol!

Before most people knew what they were, Gary was on the very first sales department computer task force.

Not only has Gary been with Catholic United Financial longer than any other sales representative, his family has put in more hours than any other: one brother, his dad and two greatuncles have all sold products for the Association.

Not only he is a “rock star” in the field, another of Gary’s hobbies is playing drums. He has a set in his basement studio.

Think you have it figured out? Flip over to see the answer below: Too much of a coincidence for you? Checkmate! Gary has never been the chess champ of St. Peter (now St. Peter, Paul and Michael). But he did attend that school with his future boss, Pete!

A little refresher

Happy Anniversary Innocent (Bud) and Frieda Roelike of Elrosa, Minn., will celebrate their 65th wedding anniversary with a Mass at 8 p.m., June 4, at St. Peter and Paul Church in Elrosa. Following, there will be a private family party hosted by their children, Kathy, Kevin, Norma, Don, Larry, Leon, Joel, Lisa, Gregg and Julie, and their spouses, 38 grandchildren and 27 great-grandchildren.

Bud and Frieda (Weber) were married June 5, 1946, at St. Peter and Paul Church in Elrosa.

Note: Anniversaries usually appear on page 17 or 19 with other announcements and memorials. They have been moved here for space. news@catholicunited.org

May/June 2011

15

Keys to your

Kingdom

Estate Planning with John Tetzloff In the last issue of Our Catholic Journey we looked at the first of three aspects of developing a good Estate Plan. The three facets of Estate planning are the personal side of planning, tax planning, and the protection phase. Last month, we looked at the personal side of an estate plan which covers the various processes available to get our assets to our heirs upon death. In this month’s article, we discuss the Estate Tax Planning aspect of a good plan.

When we talk about estate tax issues, we are really dealing with two separate tax entities. These are the federal government and state governments. The federal and state governments impose an estate tax on all estates at a persons’ death. This tax is based on the total value of the estate of the deceased.

What is included in the value of an estate? Quite simply, all the assets “owned” by the deceased at the time of his or her death. This would consist of property, tangible assets, investments, annuities, life insurance, bank products — anything the person had incidents of ownership over. Once the assets are totaled, an estate tax is calculated.

The federal tax is approximately 30%-45% of the assets in the estate!

Now, before we all fall over, the federal government also gives

each estate a “credit” toward that tax owed.

As of 2011 and 2012 that credit is equal to $5 million of assets in that estate. Quite simply, if your estate value at death is below $5 million, there is no federal estate tax due. For those with substantial estates, this number is important to keep an eye on. The Catholic United Financial sales representatives are continually learning and keeping up with the current rules so please rely on them to help keep you abreast of the federal tax situation.

When we look at the various states that Catholic United Financial serves, they each have different rules in regard to estate tax issues.

If you reside in South Dakota, North Dakota, Iowa or Wisconsin your estate tax rules are virtually the same as the federal government’s.

Currently, those states have a state exemption which is equal to $5 million of assets. Therefore, if the estate is less than $5 million, there is no state estate tax at death.

For those who reside in Minnesota, things are a little different.

Minnesota has opted to have its own estate tax rules different than those of the federal

government.

If you are a resident of Minnesota, upon your death the estate value is calculated similar to the federal rules but each estate is allowed a credit on an estate value of $1 million or less. So if the total estate value is more than $1 million, any amount that exceeds $1 million is subject to a 10%-15% Minnesota estate tax. This tax is due within NINE months of death payable in cash. The problem this can cause an estate is the issue of liquidity. Where is the estate going to come up with CASH to pay the potential tax? Which assets will need to be sold to pay the tax? Does the estate have to sell land/property to pay the tax?

As you can see, estate tax planning is crucial to an estate in Minnesota with values approaching $1 million.

Fortunately some wonderful tax planning techniques can lessen and/ or eliminate the estate tax issues.

By working with a Catholic United Financial sales representative we can help identify estate tax issues and then discuss ways to plan accordingly so your estate is not paying taxes unnecessarily. We also assist with consulting an estate planning attorney for the legal advice that is needed to complete the plan.

John Tetzloff, CLU, FICF, LUTCF, is the Catholic United Financial Advanced Case Specialist and Trainer. He leads estate planning seminars throughout the year and is the host of the “Creating Wealth Beyond Money” radio show, which can be heard Saturday mornings on the Relevant Radio network. He has more than 20 years’ experience in estate planning and financial preparedness.

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May/June 2011

www.catholicunitedfinancial.org

Announcements March

Margaret Baune, 91 Wabasso, MN St. Anne

In loving memory of our deceased members George Gohmann, 88 Loretta Mechtel, 101 Caledonia, MN St. Augusta, MN St. Elizabeth St. Mary

Helen Stroot, 92 Wadena, MN St. Joseph

Jeannette Bernardy, 77 Mary Halter, 61 Zimmerman, MN Redwood Falls, MN St. Pius X Holy Rosary

Adrian Meuwissen, 81 Loretta Theisen, 82 Bluffton, MN Cologne, MN St. John/Holy Family St. Bernard

Leona Haus, 91 Amelia Bibeau, 95 St. Michael, MN Richmond, MN SS. Catherine/Joseph St. Michael

Donald Miller, 46 St. Augusta, MN St. Mary

Bernice Sand, 87 Marystown, MN St. Anthony

Melvin Tiemann, 72 Henry Deters, 75 Melrose, MN Elrosa, MN SS Bernard/Elizabeth St. James

Thomas Kane, 52 Elrosa, MN St. James

Lorraine Schlichting, 90 Little Falls, MN Tri Parish

Daniel Borth, 85 Fairfax, MN SS. Mary & Joseph

Douglas Johnson, 73 Marvin Poepping, 64 Albert Weisser, 91 Watkins, MN New Munich, MN Waconia, MN Holy Family Immac. Conception St. Joseph

Robert Knapp, 58 Albany, MN St. Joseph

Cecelia Kohorst, 93 Lorraine Caron, 82 Farming, MN Faribault, MN SS. Lawrence & Anna St. Catherine

Colleen Roscoe, 82 Roger, MN Mary Queen of Peace

Dorothy Jones, 83 St. Charles, MN St. Isidore

Louise Janski, 86 Buckman, MN St. Michael

Sharon Burg, 61 Belgrade, MN St. Francis de Sales

Thomas Hughes, 79 Jordan, MN St. John the Baptist

Celestine Thielen, 80 Margie Dauer, 77 St. Cloud, MN Searles, MN St. Michael St. John the Baptist

Ludwig Borchert, 87 Litomysl, MN Holy Trinity

Josephine Klehr, 93 Dorothy Brisse, 89 Marystown, MN Richmond, MN SS. Catherine/Joseph St. Anthony

Alvin Corpe, 89 Zimmerman, MN St. Pius X

Alphonsus Johanneck, 82 Kathleen Rueckert, 76 New Ulm, MN Litchfield, MN St. Elizabeth St. Philip

Dorothy Hierlmaier, 84 Barbara Nistler, 92 Cold Spring, MN Watkins, MN St. Boniface Holy Family

Ralph Poepping, 78 Donald Kern, 87 James Braun, 60 Sauke Centre, MN Faribault, MN Faribault, MN SS. Lawrence & Anna SS. Lawrence & Anna St. Paul

Thomas Hoffman, 83 Rose Reich, 84 St. Paul Wilmont, MN SS. Peter & Clemens St. Kilian

Rose Marie Theisen, 95 Alice Daniel, 90 Cold Spring, MN Winona, MN St. Boniface Queen of Peace

Lidwina Blenker, 98 Albany, MN St. Anna

Geraldine Pieper, 81 Jordan, MN St John the Baptist

Jasminia Colago, 80 Big Stone City, SD Holy Family

Helen Weller, 87 Bluffton, MN St. John/Holy Family

Eugene Schmidt, 72 Leo Keilen, 88 Harriette Duffy, 83 Albany, MN Faribault, MN Winona, MN SS. Joseph/Elizabeth SS. Lawrence & Anna St. Joseph Ione Dukowitz, 86 St. Cloud, MN St. Anthony

Ruth Ann Klemmer, 55 Marie Schneider, 78 St. Joseph, MN Albany, MN St. Joseph St. Anna

Robert Pretasky, 81 La Crosse, WI St. James the Less

Margaret Whitcomb, 76 Allegra Dunphy, 84 Willmar, MN Northfield, MN St. Mary St. Dominic

Ethel Konz, 80 Kimball, MN Holy Cross

Patricia Ricke, 78 Morgan, MN St. Michael

Rose Winkels, 89 Dent, MN Sacred Heart

George Lachermeier, 95 Nicholas Seurer, 56 New Market, MN Winsted, MN St. Nicholas Holy Family

Elizabeth Rodenwald, 95 Leander Wolf, 86 Cold Springs, MN Albany, MN St. Boniface St. Anna

Michael Eraker, 48 Perham, MN Holy Family

Arthur Schoenborn, 86 Spring Hill, MN St. Michael

Marcella Fasching, 89 Irene Lindeman, 92 Emmett Steffens, 81 St. Michael, MN Rollingstone, MN Winsted, MN SS. Nicholas/Theresa St. Michael Holy Family Louis Steffl, 93 Sleepy Eye, MN St. Mary

Arline Dauer, 90 Springfield, MN St. Boniface

Rosemary Kruger, 89 Robert Ruprecht, 82 Eden Valley, MN St. Cloud, MN SS. Joseph & Mary St. Anthony

April

Veronica Feldewerd, 95 Richard McKane, 66 St. Paul, MN Sauk Centre, MN St. Bernard’s St. Paul

Anna Domenico, 92 Holdingford, MN St. Joseph

Angeline Krzmarzick, 87 Albert Sauer, 84 Aberdeen, SD Sleepy Eye, MN SS. Joseph & Ann St. Mary

Marie Anthony, 75 St. Leo, MN St. Leo

Eugene Foty, 82 Mankato, MN Holy Family

Marie Mehr, 67 St. Augusta, MN St. Mary

Willis Dressel, 85 Cologne, MN St. Bernard

Mary Lauer, 90 St. Paul, MN SS. Peter & Clemens

Delphin Freund, 77 Johnsburg, MN St. Theresa

Isadore Thielen, 76 Peter Muzzy, 55 Eden Valley, MN Melrose, MN SS. Bernard/Elizabeth SS. Joseph & Mary

Lucile Edelbrock, 80 Cold Springs, MN St. Boniface

Donald Lemke, 74 Richmond, MN SS. Catherine/Joseph

Robert Egerman, 86 St. Cloud, MN St. Anthony

Alvina Lewison, 97 Johnsburg, MN St. Theresa

Hildegard Eggert, 92 Greg Lillo, 47 Mankato, MN Miesville, MN Holy Family St. Joseph Kenneth Fischer, 75 Searles, MN St. John the Baptist

Raymond Lodermeier, 78 St. Joseph, MN St. Joseph

Jeanette Fuchs, 73 Paynesville, MN St. Louis

Louise Lommel, 88 Cold Spring, MN St. Boniface

Ann Genereux, 88 St Paul, MN St. Bernard’s

Myron McCabe, 88 Madelia, MN St. Joseph

Russell Glinski, 87 Wabeno, WI St. Ambrose

Margaret McDermott, 73 Bloomington, MN SS. Ann & Wendelinus

news@catholicunited.org news@catholicunited.org

Dorothy Schaust, 88 Lois Bassett, 76 Delano, MN New Ulm, MN SS. Anthony & Ann St. Elizabeth Magdalen Schlagel, 80 John Becker, 93 Winsted, MN Faribault, MN Holy Family SS. Lawrence & Anna Marcella Schons, 96 Mary Berg, 70 Waite Park, MN Callaway, MN St. Joseph St. Joseph Carol Schuller, 61 Gerald Berger Murdock, MN Mahtomedi, MN Sacred Heart St. Jude of the Lake Marjorie Shaddrick, 89 Lucille Brandel, 87 New Brighton, MN New Ulm, MN St. John the Baptist St. Elizabeth Adeline Snegosky, 90 Benjamin Brende, 16 Litchfield, MN Sioux Falls, SD St. Philip St. Lambert’s David Steffl, 78 Suzanne Brown, 52 Wabasso, MN St. Leo, MN St. Anne St. Leo Lucille Stroeing, 90 Joshua Bueckers, 30 St. Cloud, MN Freeport, MN St. Anothy Sacred Heart

Rose Ternes, 99 Strasburg, ND St. Mary

Bernadette Paquette, 86 Rosella Tritz, 91 Jerome Gernes, 74 Belle Plaine, MN Anoka, MN Winona, MN St. Anna SS. Joseph/Elizabeth St. Stephen Veronica Goblirsch, 85 Chad Pehrson, 40 Mankato, MN Lucan, MN Holy Family Our Lady of Victory

KimberlyTschumperlin,47 Richmond, MN SS. Catherine/Joseph George Votruba, 81 Whitehall, WI St. John & St. Ansgar

Harold Hall, 91 St. Paul, MN Home Office

Geraldine Pieper, 81 Jordan, MN St. John the Baptist

Dolores Hanson, 91 St. Paul, MN Home Office

Richard Windsperger, 91 James Raehsler, 87 New Brighton, MN Stillwater, MN St. Michael the Archangel St. John the Baptist

Helen Hazel, 93 Minneapolis, MN St. Ann’s

Marjorie Raehsler, 80 Elaine Wozniak, 79 Winsted, MN Stillwater, MN St. Michael the Archangel Holy Family

George Hergert, 89 St. Peter, MN St. Peter’s

Lillian Ragan, 88 Perham, MN Holy Family

Kenneth Zierden, 51 New Munich, MN Immac. Conception

Asteria Hinderman, 85 Sally Rasmussen, 67 Stanislaus Zlotkowski, 80 Cologne, MN Bluffton, MN Fairfax, MN St. John/Holy Family St. Bernard SS. Mary & Joseph

19 1717

March/April 20112011 May/June May/June 2011

Minutes of the

Board of Directors March 10, 2011

The Meeting was held at the Home Office in St. Paul, MN. The meeting started with Director Joe Kueppers leading the Directors in the Opening Prayer and the Pledge of Allegiance. All directors were present.

Mr. McGovern announced a minor revision to the Agenda. Approval of the January Board minutes, with the removal of an inadvertently duplicated paragraph, was moved by Director Fran Barten, seconded

by Mr. Kueppers and agreed to by all present. It was also agreed that Secretary Harald Borrmann would check Robert’s Rules of Order to determine the need for Approval/Revision to the Agenda as an action item for future Board meetings.

The January and February Investment Reports were discussed by Chair Mike McGovern and Mr. Borrmann. Catholic United Financial continues to show a strong balance sheet. The cash position continues at an optimal level for managing cash flow and operating expenses.

Mr. Borrmann mentioned that the spread between portfolio yield and annuity crediting rate is virtually unchanged from three years ago. The number of securities on the “watch list” is reducing and the loan portfolio remains stable. Mr. Borrmann provided an update of the Association’s mutual fund portfolio which continues to improve.

Mr. McGovern informed the Board of the Association’s intent to enter into an investment management agreement with Wellington Management for a portion of its fixed income portfolio. This strategy was discussed at two prior Investment Committee meetings. Reasons include: Improved risk management, collaboration with other Catholic fraternals and new investment opportunities along with resources to assist the Association’s Fixed Income Manager. Approval was moved by Mr. Kueppers, seconded by Director George Gmach and approved unanimously.

Revised Council By-laws for the following councils were reviewed by Mr. Borrmann:

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May/June 2011

Front row from left: Deborah Pauly, President & Chairman Michael McGovern, Senior Vice President & Secretary/Treasurer Harald Borrmann and Lead Director Fran Barten. Back row from left: George Gmach, Robert Krattenmaker, Michael Schmitz, Joseph Kueppers and John Maile.

St. Catherine, Millerville, MN St. Matthias, Hampton, MN St. James, Aitkin, MN Christ our Light, Zimmerman/Princeton, MN Mr. Kueppers moved, Director Mike Schmitz seconded and the Board approved these By-laws.

With regard to Policy Governance, Mr. McGovern led a discussion on the following items: Governing Style Lead Director Member Complaint Report The Association’s 2010 Financial Report was presented by Mr. Borrmann and Controller Allan Carlson. The Association had a very strong year in 2010. Some key points were: All-time high in net admitted assets of $669 million All-time high in premium of $53.5 million All-time high of insurance in force of $1.94 billion Second highest-ever surplus attained of $28.6 million, and No deterioration in asset strength and quality Mr. Carlson mentioned that our Association is poised for another excellent year in 2011, with a goal of exceeding the all-time high in surplus of $30.2 million.

Next, the Association’s outside attorneys presented an update on the status of the Securities Lending issue. Management continues to monitor events in connection with this issue, including suits being filed elsewhere in the United States. The Association is getting timely and helpful advice from its lawyers.

Mr. McGovern said the Constitution Committee will be set up shortly, with a few minor issues to bring before the Delegate Convention, including formally adopting the term “Sales Representative” and making St. Paul the official home office city.

Mr. Borrmann led a summary of recent activities on the Risk Management front: New imaging hardware and software

are being installed.

Acceptable Use policies are being promulgated.

Regional managers have received improved smartphones, allowing them improved access to email, etc. while traveling.

Plans are being reviewed for remodeling building entrance; concrete deterioration has made this a priority.

Mr. Borrmann has had conversations with the Association’s consulting actuary, Howie Heidorn, about a formalized approach to succession planning.

With regard to the new business opportunity, Mr. McGovern presented updated information to the Board. It is expected that our Board be presented with a final document for approval and signature at the April Board meeting. Mr. Kueppers moved and Mr. Gmach seconded, that management continue to finalize the agreement subject to the considerations discussed at the January Board meeting.

Mr. McGovern shared the following President’s remarks: The Heritage Center, the lobby, the Credit Union and other areas have new signage The “Day on the Hill” where Association employees met with state legislators was very successful with numerous employees participating Mr. McGovern had a productive meeting with Mike Rothman, the Commerce Commissioner The raffle was successful beyond our expectations and is a tremendous boost to Catholic education in our operating territory The scholarship program had record applications in excess of 500 Catholic United was a co-sponsor of Daffodil Days, an event for the benefit of the American Cancer Society Catholic United has been sponsoring St. Paul’s Outreach for 25 years and will be part of an event celebrating that organization The Foundation had a training session in preparation for the upcoming flood and

www.catholicunitedfinancial.org

Board Minutes are abridged. Complete minutes are available at no charge by contacting the Home Office at 1-800-568-6670 or by visiting our Web site. storm seasons; the Disaster Response group is ready to go, and will be working with Nechama.

The radio ads have been very well received Sales of life are up nicely, annuities are down slightly, both in keeping with 2011 goals Net Membership has dropped slightly Catholic United will sponsor the TEC organization Mr. Gmach led the Board in a closing prayer and the meeting was adjourned at 2:55 pm.

Respectfully submitted, Harald E. Borrmann Senior Vice President and Secretary/

April 12, 2011 Treasurer The meeting was held at the Home Office in St. Paul, MN. The meeting started with Director John Maile leading the Directors in the Opening Prayer and the Pledge of Allegiance. All members were present.

The prepared Agenda was used. Director Deb Pauly moved, Director George Gmach and the Board approved the March minutes with a few editorial corrections.

The Investment Report was discussed

by Chair Mike McGovern and Secretary Harald Borrmann. The Association’s investments continue to perform well. The arrangement with Wellington Management is off to a good start and the Association’s Investment Manager is pleased with the resources available. Mr. McGovern showed the Board a chart with several key ratios and indicators; all the ratios are favorable for Catholic United. Director Fran Barten moved, Mr. Maile seconded and the Board approved the Investment Report.

Mr. Borrmann presented Council Bylaws for the following councils: St. Andrew’s, Elysian, MN St. Rose, St. Rosa, MN St. Anthony, St. Cloud, MN Sts. Joseph and Elizabeth, Sykeston, ND Mr. Borrmann suggested that the Board approve all By-laws as presented. Director Joe Kueppers moved, Mr. Gmach seconded and the Board approved these Bylaws.

Policy Governance: Mr. McGovern presented the following items for review and/ or approval: Financial Conditions and Activities Asset Protection; Mr. Kueppers moved, news@catholicunited.org

Ms. Pauly seconded and the Board approved.

Unity of Control; Mr. Borrmann updated the Board with regard to the two most recent Investment Committee reports.

Mr. McGovern reviewed the Corporate Donations Policy. Mr. Kueppers so moved, Mr. Gmach seconded and the Board approved.

Mr. McGovern reviewed the annual donations. Mr. Kueppers moved, Director Mike Schmitz seconded and the Board approved the donations as presented. A new donation to the Human Life Alliance was presented. After discussion, Mr. Kueppers moved, Ms. Barten seconded and the Board approved this donation request.

Mr. Borrmann updated the Board on pension funding. The Association’s pension funding is in good shape. Securian continues to provide timely and sound advice.

Mr. Borrmann provided a Risk Management update. Current projects include: new mainframe computer with enhanced security, improved email security, DR site improvements, the re-forming of the Antifraud Committee, participation in an ERM study by RJF Agencies and the Association’s increased involvement with an ERM Panel at the upcoming American Fraternal Alliance Secretary’s Section meetings.

Mr. McGovern discussed the Constitution Committee. Members have been invited and accepted. A meeting date has been set.

Next, Mr. McGovern updated the Board on the new business opportunity. Things continue to progress and he expects to bring this project to conclusion very shortly. The Board reviewed all relevant documents and information and agreed to continue the process.

Mr. McGovern reviewed the Succession Planning progress to date. The Ad-hoc Committee has met again and reviewed the Lead Director and Chair/CEO job descriptions. The Board made a few editorial suggestions and clarifications to the Lead Director job description. The Committee will continue to meet as needed but feels the current timeline is accurate and the process is on track.

With regard to the 2011 Annual Delegate Convention, letters of intent to run have now been received from Incumbent Harald Borrmann for the position of Senior Vice President and Secretary/Treasurer and from Incumbent Directors Joe

Kueppers and George Gmach. No other notifications have been received. Mr. McGovern reviewed the tentative Convention schedule and preliminary logistics. The Board meeting will be scheduled in such a way as to provide adequate time for the Officers to visit all Committees meeting prior to the start of the Convention. There will be an expansion of last year’s successful on-line registration process as it has been well received by our members.

The President’s remarks are as follows: The Rector’s Dinner was a big success The seminary enrollment has near-record levels The Association’s lapse rates continue extraordinarily good The Credit Union enjoyed its best month ever in new loans in March, and April is trending well The Credit Union is looking at a new business opportunity The Association provided a record number of post-high school scholarships with most applicants using the on-line process The Foundation Disaster Response unit has been trained and is ready to go.

The Foundation is also engaged in succession planning and that process is moving forward The pending legal matters are in good shape and progressing according to plan and expectation Sales of life insurance are up nicely over a good 2010 year Annuity sales are down somewhat, but very much on target with management’s plans The Priest’s Golf Outings are being scheduled. These are very much looked forward to by the priests in all the dioceses.

Mr. McGovern provided information about the Alliance’s Annual Meeting in Denver in September. The topic will be further addressed as the date approaches.

The Board was asked to provide the Self-Evaluation when asked to do so; this remains a valuable tool, yet with the generally positive remarks, it is felt that it need not be done more than annually, and perhaps even less than that.

Ms. Barten led the closing prayer and the meeting was adjourned at 2:15 pm.

Respectfully submitted, Harald Borrmann Senior Vice President and Secretary/ Treasurer

May/June 2011

19

Youth

Young members honored at Salute to Youth Degree of honor’s yearly awards banquet recognized three Catholic United members for their outstanding commitment to leadership in their communities.

From left to right, Rhoda Habedank, Lindesy Adams, Youth Liaison Nate Lamusga, Kyle Yarusso, Mary Collins, Rocky Yarusso, Melissa Johnson, Adriana Johnson, Phillip Johnson. Composite photograph of Catholic United Financial’s honorees at the Salute to Youth Banquet, April 19, 2011.

Three more members of Catholic United Financial joined the rarefied ranks of Salute to Youth honorees on April 19 this year, continuing a tradition dating back more than 50 years.

Since 1959, the Salute to Youth banquet has honored high school seniors in Minnesota. Honorees are young men and women who lead balanced lives and display a broad array of achievements including volunteering, academics, sports, spiritual development and commitment to family.

Members of various fraternal groups nominate honorees who receive a plaque commemorating the event and attend banquet in their honor.

Catholic United Financial nominated three outstanding individuals for this award, they were among 35 others selected by various organizations throughout the state.

Our honored youth were Lindsey Adams, of Waubun High School; Kyle Yarusso of Hill-Murray High School in Maplewood, Minn.; and Melissa Johnson of Farmington High School.

Lindsey Adams, a recipient of the Presidential Service Award, thrives on helping people. She independently raised more than $1,000 for tornado-ravaged Wadena, Minn., through a t-shirt drive. She coordinated a “mock disaster” drill, worked for a swine flu clinic, participated in the Relay for Life as a student liaison and conducted elementary hearing and vision screenings. Lindsey is a

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May/June 2011

Hugh O’Brian Youth Leadership Alumnus, and a member of the Waubun Student Council Board of Executives, choir and band.

Kyle Yarusso has been a fixture at the Mahtomedi food shelf for more than eight years; he is well known in his church and school community as a young man eager to help. In December, he achieved the singular honor of Eagle Scout. Along with his food shelf work, he has volunteered for Feed My Starving Children, Second Harvest and St. Christopher’s Place, as well as at Martin Luther King Jr. Center as a tutor. He has been a member of student council for three years, and is a member of the Peer Ministry and the National Honor Society.

Melissa Johnson is also a member of the National Honor Society. She has an outgoing personality and a passion to help others. She volunteers for Mary’s Place and Bridging. She helped plan and coordinate the Toys for Tots drive in her area, and was involved in “Youth Teaching Youth,” promoting drug- and substance-free lifestyles with middle and elementary school children.

She has traveled to Montana to serve with a church mission trip on a Blackfeet Indian reservation and is a member of Peers for Peers and Link Crew, assisting young students in her school.

These fine young members embody the fraternal spirit, and we are proud to call them members.

Congratulations, Lindsey, Kyle and Melissa!

www.catholicunitedfinancial.org

Catholic United Kids Cool Kid

Name: Julia Welle Age: 10 Hometown: Freeport, Minn.

School: Sacred Heart School Just the facts, Julia: This month’s Cool Kid drawing winner is Julia Welle of Freeport, Minn. Julia is a fourth grader with a lot on her plate! She plays piano, basketball and volleyball, and also performs in kids theater. From helping her dad in the barn every night, she’s developed a love of country music, which she expresses by playing guitar. She’s a member of the school’s guitar group and plays at Mass twice a week. She’s a big help to her mom as well, looking after her younger siblings, Grover, Blaise and Max. Keep busy, Julia. Congratulations!

Be the July/August Cool Kid! Fill out the puzzles on this page

as best you can and submit them to Our Catholic Journey. One winner will get a Catholic United prize pack! Include your information, as seen above, a photo (can be returned) and a phone number. Send to: Catholic United Kids, 3499 Lexington Ave. N., St. Paul, MN 55126.

Catholic United Kids

news@catholicunited.org

Amazing Saints artwork and games ©2011 Mario D. Macari. All rights reserved. mario@incrediblesaints.com

may/june 2011

21

ye on the Industry Your sneak peek into current trends of the fraternal life insurance industry

JOIN HANDS DAY service events unite volunteers young and old Catholic United Financial local councils joined hands to celebrate fraternalism again this year for the annual JOIN HANDS DAY event, sponsored by the American Fraternal Alliance.

Eight different projects led by Catholic United Financial members were registered with the JOIN HANDS DAY website, and each was intended to be a day of service that connected youth and adults, as per the event guidelines.

In Albany, Minn., a Catholic United group joined with the local 4-H chapter to visit with the residents of Mother of Mercy Manor, serve snacks and play bingo. Members from the Minnesota cities of Delano, Zimmerman and Morgan all took part in yardwork and cleanup of cemetery, parish and convent grounds (see page 4 for photos). Members in

Madison Lake, Minn., took the time to assemble care packages at All Saints Parish. The packages will be sent to deployed troops overseas.

Members of St. Joseph / St. Elizabeth Council and Queen of Peace Council hosted bingo and ice cream for the residents of St. Anne Extended Healthcare facility in Winona, Minn. Members also collected food items at the Festival Foods in White Bear Lake, Minn., and delivered them to the local food shelf.

JOIN HANDS DAY officially takes place on the first Saturday in May annually. This year’s event was held on May 7, but service events can be scheduled on any day of the year.

Thanks to all the Catholic United members and friends who took part in this multi-generational day of service!

Study shows men lead in seeking service from insurers Insurance trade association LIMRA gleaned data from a recent study that shows male consumers are more likely to seek service from insurance companies than female consumers. In nearly every category of communication (phone, email, mail, website, etc.) men were more likely to contact their insurance company for service than women. Men were also twice as likely than women to use email when communicating with their insurance providers.

What does this mean for life insurers like Catholic United Financial? While LIMRA did not provide a

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May/June 2011

reason for the gender disparity in its findings, it did encourage insurance providers to make sure their advertising and customer service channels appeal to men and women.

In light of this study, the best advice to pass on to consumers of both genders is: Don’t let your questions and service needs go unanswered or unmet. Catholic United Financial encourages all our members to use the services available to them in order to be informed about the status of their products. Local

Sales Representatives are at the ready to answer questions, and the staff of our Member Services department is available to look up the status of any member’s account information.

Don’t forget that account information is available online through our SecureView site at catholicunited financial.org/links/secureview.

The site is available 24/7 for viewing and updating your contact information. If you haven’t signed up for an online account yet, do it today!

Source: LIMRA, Pinpointing Customer Preferences

www.catholicunitedfinancial.org

Metro

Directory

Sales Representatives in Your Area Denise Degerstrom, FIC 320-384-0339

ddegerstrom@catholicunited.org

Braham, Cambridge, Isanti, Mora

Jon Ginther, FIC

612-644-0563 jginther@catholicunited.org Plymouth, Rogers, West Minneapolis Suburbs

Mike Kirchhoff, FICF

Tim Parks, FIC

763-753-5758 tparks@catholicunited.org Anoka, Ham Lake, Ramsey, Coon Rapids

Gary Rosendahl

952-445-4790 grosendahl@catholicunited.org Burnsville

Grand Rapids, Hibbing, Cloquet

Carol Lindner, FIC, LUTCF 952-657-2210 clindner@catholicunited.org Waconia, Victoria, Norwood, St. Bonifacius

Ryan Selleck, FICF 952-933-0780 rselleck@catholicunited.org S. Minneapolis, Richfield, Bloomington, Minnetonka

mkirchhoff@catholicunited.org

Joe Utoft

651-330-3621 jutoft@catholicunited.org Northeast Minneapolis, Fridley, St. Anthony

Peter Ryan, FIC

763-972-8283 pryan@catholicunited.org Delano, St. Michael, Albertville

218-391-9444

Bob Sorensen, FIC, FLMI 763-682-6001 bsorensen@catholicunited.org Annandale, Buffalo, Maple Lake

Sam Welter, FIC 952-448-4865 swelter@catholicunited.org Chaska, Cologne, Glencoe, Winsted

Patrick Brown, FIC, CLF 888-412-9766 pbrown@catholicunited.org Regional Manager, Metro

Join us for summer baseball fun!

We’re welcoming new members to our association with exciting nights of baseball fun. Join us for “Members.Values.Products.”

Celebrations at a minor league ballpark near you; locations and dates are listed below. Enjoy a light meal and outdoor baseball.

Game time is 7 p.m., doors open at 6 p.m. New members are welcome to sign up for tickets online at www. catholicunitedfinancial.org/links/baseball. Tickets are “first-come, first-served” so sign up today!

Regional Events July 10 – Fellowship Sunday, Robbinsdale, Minn. Enjoy donuts, refreshments and a picture with the “Pope” after Mass. Contact Sales Representative Jon Ginther for more details.

Aug. 5-6 – Annual Convention, Collegeville, Minn. More dtails on the convention can be found at www.catholicunitedfinancial.org/ links/convention.

• Duluth Huskies – June 29 • St. Paul Saints – Aug. 23

news@catholicunited.org

May/June 2011

Visit www.catholicunitedfinancial.org for more event listings.

23

3499 Lexington Ave. N., St. Paul, MN 55126-8098

Report of the Constitution Committee Changes recommended for adoption at 2011 Convention The Committee on Constitution and Bylaws, duly appointed by the President of the Association, met at the principal office of the Association on April 28, 2011. The Committee reviewed and gave consideration to proposed amendments to the Constitution and/or Bylaws that had been submitted to the Board of Directors of the Association.

The Amendments to the Constitution and Bylaws of the Association, for approval by the 2011 Delegate Convention are as follows: RECOMMENDED CHANGES: 1.) The committee recommends that all references to the position title of “field representative” in the Constitution and/or Bylaws be changed to read “sales representative.”

2.) The committee recommends that Article IX. Location of Principal Office be updated from Arden Hills to St. Paul.

If approved by the 2011 Delegate Convention the first line of Article IX will read: The principal office of the Association shall be located at 3499 Lexington Avenue North, St. Paul, Minnesota, 55126.

3) The committee recommended a change in wording of the first line of paragraph 2 of Section 33 - Benefits and Contract which would change the due date of benefit assessments from the first day of the month to when the assessment is due.

If approved by the 2011 Delegate Convention, Section 33, Benefits and Contract, paragraph 2, will read as follows: Benefit assessments levied pursuant to the Constitution of the Association and these

Bylaws shall be payable when the assessment is due, and any member who fails to pay such assessments before the expiration of the grace period as stated in the Benefit Contract, and who is not a “Benefit” member or limited member by way of any other Benefit Contract then in effect, shall by that fact be suspended from the Local Council and the Association.

The committee members in attendance unanimously recommend that the foregoing amendments be passed.

4.) The Constitution Committee also received a recommendation to change the fourth paragraph of Section 9 of the Bylaws which would change the maximum age to hold office for a Director from age 75 to age 70 and to strike the second sentence of this paragraph regarding term limits of Directors.

The committee members in attendance unanimously recommend that there be no changes to Section 9, paragraph 4.

Respectfully submitted, Diane Symanietz, Chairperson – Annunciation Council, Mayhew Lake, MN Karen Brandl - St. Boniface Council, Springfield, MN Susan Dingmann – St. Martin Council, St. Martin, MN Lisa Neugebauer – Holy Spirit/Holy Family Council, Mitchell, SD Rosella Quast – Holy Family Council, Winsted, MN John Welle – St James Council, Aitkin, MN Absent committee member: Darlene Reinert – St. Anastasia/Boniface Council, Hutchinson, MN Catholic United Financial Fraternal Results through March, 2011 Total:

$ 2 2 8 ,1 6 7.6 2

Raised By Councils:

Hours Volunteered: 1 2 ,2 8 3

Catholic United Financial Fraternal Results through March, 2011

$2

2 8 ,1 6 7.6 2 Raised By Councils: Councils: Hours Volunteered: 1 2 ,2 8 3 Matched: Total:

$1 $0

8 1 ,1 5 8.0 9 4 2 ,0 0 9.5 3

Matched:

$ 1 8 1 ,1 5 8.0 9 $ 0 4 2 ,0 0 9.5 3