REPORT OF THE PERPETUAL LIFE MEMBERSHIP (PRE-PAID DUES) FUND
For more than sixty years, the Grand Lodge of Minnesota has kept a solemn obligation to pay perpetual life member dues to our lodges. This sacred trust is based upon a desire to sustain our lodge’s funding stream from membership dues, knowing that even with infirmities of age or limited financial resources, their membership in the constituent lodge would never lapse. This commitment will continue for our members currently enrolled in this program, but during this past year, some significant recommendations have been proposed:
- The Corporate Board Trustees suspended Life Membership (Pre-paid Dues) membership on July 8, 2023 pending a recommendation from a specially appointed Grand Lodge Pre-paid Dues Committee.
- Legislation is being presented at this 2024 Annual Communication to discontinue further membership expansion of the program and to recommend the program be officially changed in the General Regulations of the Grand Lodge of Minnesota — Article 22 – Prepaid Membership Program. (See 2024 Resolution No. 2 in the preprints)
- Notable in the legislation, the Grand Lodge of Minnesota will continue to assume the financial commitments for those members currently enrolled until their death.
- If this legislation is passed, current pre-paid dues fund assets will be used to repay the Grand Lodge for monies used to keep the program solvent from 2009 to 2020.
These actions are being taken following a careful review of the program and the fact that the Grand Lodge has remitted $850,416.58 into the program to keep it solvent during the years 2009-2020. Currently, the program has a net fund deficit of $720,850.32 of the $1,722,616.52, which has been the member’s net equity through payments into the program since its inception. It is believed that this deficit cannot be made up by investment returns of future years while continuing to keep the contract for each current living member to pay their annual dues back to the constituent lodge until their death.
At least twice in the history of the program, the member age x actuarial dues figure has been adjusted. However, as noted many times in the previous year’s reports, the constituent lodge dues have increased so significantly in the past 20 years that investment returns on the member’s net equity cannot keep up with the costs. This was also exacerbated by the action of the Board of Trustees not to limit the dues payout (as is provided by stipulation of Article XXII to only 5% annually). Regardless of the cost, this was done, especially to support the constituent lodges in the hope that future investment returns would make up for shortfalls.
The accompanying statistical report gives the breakdown of members, net equity, and payouts during this past year, 2023. In total, the program has had 3,589 members during the past sixty-plus years. 2,327 are now deceased, and 1,235 are living as of December 31, 2023, with 27 having been expelled, suspended, or unaffiliated.
The following statistics significantly show the exponential growth of constituent lodge dues. The average pay-in of all living members to this fund was $51.20. Currently, the average dues for these members are $132.18. The average of all dues across the state of Minnesota is $215.43. A comparison of just five years ago shows that the weighted average of all lodge dues was $89.50, which shows a significant increase in lodge dues over the past few years. This is an increase in dues of nearly 240% in the preceding five years alone.
For this past year, 2023, the payout for dues to lodges for living members is $168,220.00 plus $669.50 for the Grand Lodge administration cost of the program. Again, the income from investments was $129,325.61. This is $38,894.39 in equity loss in the program for this 2023 year. Clearly, this program is not sustainable with these parameters, and we must decide to salvage the best outcome for the program that is possible given these trends.
My brothers, we implore you to look at these statistics and ask what we can do to best keep faith with the members who are now living to fulfill the program’s intent of supporting their lodges through all the vicissitudes of life. We hope you will seriously consider voting in favor of the recommendations of the proposed legislation concerning Resolution No. 2. There appear to be no other good choices before us.
Fraternally yours,
Robert L. Peterson, P.M.,
Neil Neddermeyer, P.G.M.
Frank Spevak, Grand Treasurer
Douglas Campbell, P.H.G.M.
Terry L. Tilton, P.G.M., Chairman
