Pension shortfall leaves many Minnesota Catholic school, church employees in limbo

Business and Economic News

Kirsti Marohn

March 20, 2026 4:00 AM  

Mary Goenner spent more than three decades teaching music to Catholic elementary school students in the St. Cloud area, earning a salary that she says was a fraction of what she would have made at a public school.

"But I thought, ‘I've got that retirement plan,’” Goenner said, referring to a pension fund through the Catholic Diocese of St. Cloud. “And I just loved the community, loved the people I worked with. It was so good that I just chose to stick with it."

Since Goenner retired three years ago, she has counted on her pension and Social Security to make ends meet. 

But last October, she got a letter from the Catholic Diocese of St. Cloud. It said the diocese's pension plan is “significantly underfunded” and doesn't have sufficient assets to meet its long-term obligations.

The diocese’s pension plan was operated by Christian Brothers Services, a Catholic financial services firm based in the Chicago area that provides retirement services for about 40,000 employees nationwide. Its pension fund is facing a massive $800 million financial shortfall.

Goenner said she couldn't believe it when she heard her pension might be at risk.

“I about fell on the floor,” she said. “I was just so shocked and terrified, not knowing how I was going to afford to keep on living as a single person.”

The financial challenges with Christian Brothers’ plan began back in the 2008 recession. In a company brochure, the firm blames the shortfall in part on economic changes and an increase in the number of retirees compared to active employees. It says the plan only has assets to cover about 66 percent of future benefits, and employers would have to increase payments to close the gap.

The dioceses of St. Cloud, New Ulm and Crookston — plus some Catholic schools in Minnesota — were among those being asked to pay more into the fund.

The Rev. Scott Pogatchnik, the vicar general for the St. Cloud diocese, said the first they heard that the fund might be in trouble was late last summer.

“Like a lot of different pension plans, they kind of go up and down,” he said. “But certainly, nothing of this magnitude was ever communicated to us.”

Looking ahead

The pension shortfall affects about 1,400 current and former lay employees of the St. Cloud diocese. They include teachers, youth ministers and administrative workers.

The diocese formed a task force and hired a consulting group and legal counsel to figure out what to do next.

Pogatchnik said staying with Christian Brothers and paying millions more every year to help the company make up the difference wasn't possible. Nor was covering the $35 million shortfall with the diocese's own funds.

Instead, the diocese froze the current pension plan in December. That means new employees can't enter it, and current employees aren't accruing any new dollars. The diocese, its parishes and schools are still contributing to the fund.

The St. Cloud diocese also created a new, separate pension fund it will operate in the future. It expects that Christian Brothers will transfer funds into that account sometime this summer, said Bailey Ziegler, the diocese’s human resources director.

Pogatchnik said it's not clear yet whether retirees’ pensions will be cut, or by how much.

"We're doing all we can right now to honor our promise to them,” he said.

Employees: Raise funds to fulfill obligations

Jeffrey Kaster, now retired, worked as a teacher and youth minister in the Catholic Diocese of St. Cloud for 23 years. He helped start the Diocesan Pension Concerns Group, made up of current and retired employees, after news that the diocese's pension plan faced a major shortfall.

But some employees think the St. Cloud diocese should do more. 

Jeffrey Kaster worked for the diocese for 23 years in education and youth ministry. He helped form a Diocesan Pension Concerns Group, made up of current and retired employees.

Kaster said many teachers and parish workers spent their careers working for the Catholic church for relatively low wages, so their Social Security benefits aren’t as much. Their pension is their primary source of retirement income.

“One 80-year-old person said to me, ‘I'm afraid I'm going to have to leave my house, or I might have to go get another job,’” Kaster said. “Really, it can be devastating for people.”

Kaster and other employees say the St. Cloud diocese hasn't been transparent enough with the entire church community about the pension situation. They want a face-to-face meeting with Bishop Patrick Neary, which the bishop has not yet agreed to. And they want the diocese to launch a capital campaign to cover the pension shortfall.

"We're just saying the diocese needs to raise funds to meet its moral and legal obligations,” Kaster said.

He noted that the pension situation comes six years after the St. Cloud diocese filed for bankruptcy after receiving legal claims from dozens of victims of clergy sexual abuse.

“I think that this is actually an opportunity for the diocese to just do the right thing and take care of its workers, and actually build some positive momentum for the diocese and the church,” Kaster said.

Pogatchnik said the bankruptcy doesn’t have an impact on how the diocese handles the pension issue. He said diocesan leaders have been sharing as much information as they can, and hearing almost daily from those who are affected. 

Having spent time as a parish pastor, Pogatchnik said his heart goes out to them.

“So many of these people were my employees,” he said. “They were my school teachers. They were my parish employees. They're my current coworkers.”

For now, Pogatchnik said, all options — including a capital campaign — are still on the table. But he said he doesn't want people to overestimate how much money could be raised.

Worries about the future

Meanwhile, current and retired employees of the St. Cloud diocese say they're considering legal action. And they’re trying to figure out how they would get by on much less if their pensions get smaller.

Teri Krowka-Ansberry spent 23 years working as a director of faith formation for several parishes in the St. Cloud diocese. She said she was able to retire four years ago because of her pension.

“I was so grateful to have that,” she said. “So that's why now it's jolting, to say the least.”

Krowka-Ansberry said she already lives frugally, but worries about how she and other retirees will pay for basic costs of living and health care if their pensions are cut.

“My concerns right now are paying bills, prices going up, gas, food, insurance,” she said. “Everybody is struggling.”