Calculating Gifts: George A. Huggins and the Conferences on Annuities, 1927-1959

Calculating Gifts: George A. Huggins and the Conferences on Annuities, 1927-1959

Part 3.4: A Gift Annuity Campaign Catches Fire - National Leadership
Article posted in Charitable Gift Annuity on 18 February 2015| comments
audience: National Publication, Ron Brown | last updated: 18 February 2015


After its phenomenally successful Annuity Bond campaign captured national attention, the American Bible Society embraced new standards of advertising ethics.  ABS led the first professional association of philanthropic planners for more than six decades.

By: Ron Brown

Storm Clouds Gather Over Annuity Bonds

Just as Arthur Ryan took over as Financial Secretary, the top managers of the Bible Society were engaged in a soul-searching debate about the proper balance between financial motivations and philanthropy.  That debate would have fundamental implications for the Bible Society, and would involve two giants of the national gift annuity movement: George Huggins, hired by the Society in 1925 to audit its gift annuity program, and Gilbert Darlington, Treasurer of the Society since 1920. 

In the spring of 1927, when the Conference on Annuities met just a few blocks from ABS headquarters in New York City, the debate over financial self-interest versus public-spirited philanthropy was in full bloom.

The immediate cause of the debate within ABS was a complaint from a donor.  Minutes of the Ways and Means Committee on January 6, 1925 record that an anonymous letter dated December 23, 1924 criticizing the promotional materials of the ABS Annuity Bond campaign was received from a “Subscriber,” “raising the question regarding the nature of this literature.”  As a result, the ABS Finance Committee demanded a review of “literature used in advertising annuity bonds.”  

The Ways and Means Committee appointed a four-person sub-committee (including Frank Mann as a volunteer member) and charged it to “look over the advertising material for annuity bonds to see if there is any basis for the complaint made” and report back at the next meeting.  However, at the next meeting the sub-committee put the question back to the Finance Committee: what changes did they think were needed in order to make the ABS materials acceptable while keeping them effective? 

On February 19, 1925 Secretary Ryan reported that the Ways and Means Committee passed the following motion:

Resolved that the General Secretary ask each member of the Finance Committee to send in his criticisms of our annuity literature for the benefit of the sub-committee of the Ways and Means Committee appointed to revise this literature.

Ryan quickly decided on a time-honored strategy for the incoming manager of a controversial program belonging to his predecessor: he hired the nationally-recognized actuary George Huggins to perform a general audit of the ABS annuity program.  On April 23, 1925 the Ways and Means Committee minutes record that Huggins is “now at work preparing an expert report on the whole annuity program of the Society.”  Until Huggins completed his audit, ABS would “continue to use the present supply of annuity literature.” 

The Bible Society’s national reputation continued to soar.  When Dr. Alfred Williams Anthony organized a Sub-committee on Annuities in March 1927, he hand-picked six members to join him: two actuaries and representatives of four charities, including Arthur Ryan. 

Only three speakers made presentations at the Conference on Annuities held on April 29, 1927.  George Huggins’ “Actuarial Basis of Rates” was the keynote address.  Two leaders of the American Bible Society delivered superb reports: Arthur Ryan spoke on gift annuity administration and advertising, and Gilbert Darlington on gift annuity legislation and taxation.[1]

Underlying Secretary Ryan’s remarks on advertising was the fact that a month earlier, members of the Committee on Financial and Fiduciary Matters had discussed the specific question of whether it is appropriate to promote “annuity bonds.”  Their charge to the new Sub-committee on Annuities included this very clear policy decision: “That organizations engaged in writing annuity business discontinue use of the word ‘bonds.’”[2]

To Ryan, promoting gift annuities as bonds remained a live option.  He surveyed 31 major charities that issued annuities, and reported to the April conference that the prevailing terminology included “annuity bond,” “life annuity bond,” and “annuity bond agreement.”  Ryan acknowledged a “more recent tendency” away from the term “annuity bond” to avoid confusing gifts with commercial bonds, “which are documents guaranteeing the return of the principal as well as payment of interest.”  While noting that some people had begun to allege that use of the word “bond” is “not quite ethical,” Ryan asserted that confusion can be avoided by clearly stating the nature of the gift annuity in the charity’s advertising and in the contract itself, claiming that “annuity bond” simply “defines the kind of bond.”[3]

Secretary Ryan took the opportunity to question the Committee’s finding:

The Committee was not unanimous in its judgment regarding the nomenclature for the form of annuity contract, but the majority was inclined to recommend annuity agreement.  The minority held to the term annuity bond agreement.

Ryan made clear he was among the dissenters arguing in favor of annuity bonds:

From his investigations, the writer sees no reason why any of the names quoted above should not be used, providing the essential statements in the document itself are in accord with legal requirements governing such contracts.

Gilbert Darlington followed Arthur Ryan at the Conference podium.  Darlington had managed gift annuity accounting, investments, and financial reporting since becoming Treasurer of the Bible Society in 1920.  He did not share Ryan’s certainty on the terminology of annuity bonds.  Speaking about his experience with Federal and state legislators, including some who were considering whether to tax gift annuities as if they were commercial investments, Darlington observed diplomatically that “There is great need for cooperation in facing this problem fairly and squarely”:

There are those who think that the wording of annuity contracts or agreements may have an important bearing on this point.  Does the phrase “Annuity Bond Agreement” make it more difficult to meet this situation, and if so, why?

The public debate between Darlington and Ryan ended abruptly with the death of Ryan on June 22, 1927.  There was no official action on the question of “annuity bond” terminology at the second Conference on Annuities held in November 1928, but the third Conference on Annuities in November 1930 came down strongly opposed to promoting gift annuities as bonds.  In his preface to the conference report Dr. Alfred Williams Anthony wrote about “Certain perils” such as “Misleading Terminology”:

The word “Bond” is frequently employed in this connection. Annuity agreements have nothing to do with “bonds” in the ordinary investment and financial sense of that word, for they are not secured by any mortgage upon real estate or other real property. They are bonds only in the sense that they are written contracts which bind two parties.

Gilbert Darlington soon became the national spokesman for ABS on gift annuities.  Under his leadership the American Bible Society formally changed its advertising policy on February 19, 1931. 

Some drama was involved.  The Committee reviewed the advertisements for Annuity Bonds of the American Bible Society that were “now appearing in 28 periodicals,” clearly the largest and most profitable annuity campaign in the United States.  ABS Financial Secretary George William Brown read aloud “the paragraph dealing with terminology” delivered by George Huggins at the third Conference on Annuities in November 1930: 

As to the terminology, it is suggested that the term annuity agreements be used, rather than annuity bonds, contract annuities, or conditional gifts.  It is also suggested that the return to the donor be referred to always as annuities, rather than as interest.  In a similar vein, it is suggested that the solicitation for funds, to be administered in connection with annuity agreements, be on the basis of featuring the service being rendered by the organization, rather than as an investment; nor should the annuity return be stressed too greatly as the appeal for the gift.[4]

Brown added that the previous month (January 1931), at a conference held by the Methodist Episcopal Church, ABS was criticized for ads featuring its maximum annuity payment rate of 9%.  This was a full percentage higher than the maximum offered by the Methodists, and the 9% rate was highlighted by ABS in a way that could be misleading to most annuitants, who would receive much lower annuity payments.[5]

Members of the ABS Ways and Means Committee voted approval of historic recommendations overturning the entire promotional strategy of the Bible Society:

That the phrase “as high as 9%” be modified to avoid any possibility of misinterpretation; that the term “bond” be eliminated; and that the use of terms implying “investment” be discontinued; and that all annuity advertising be in harmony with the highest ethical standards.

The ABS Board of Managers approved the recommendations in March.  At its meeting on May 21, 1931 the Committee reviewed new advertisements in which “such phraseology has been used as to conform to the highest standards of annuity advertising.”

Now that his own house was in order, Gilbert Darlington was able to speak freely to other charities issuing annuities.  Addressing “The Up-To-Date Legal Situation” at the fourth Conference on Annuities in 1931, Darlington warned that courts, regulators, and lawmakers are taking a close look at a charity’s “correspondence and publicity” when deciding issues involving gift annuities.  Darlington urged charities to review and revise their terminology:  “The use of such words as ‘interest’, ‘bond’, ‘principal remaining’ should be avoided in all correspondence dealing with annuities.”[6]

National Leadership Provided by the American Bible Society

With Huggins on board the Bible Society in 1925, Arthur Ryan and his colleagues embarked upon an important transitional period of consolidating gains in the annuity program and strengthening ABS administrative policies and procedures.  There was a new openness to comparing the practices of other charities issuing annuities, and a growing sense of responsibility for sharing the successes of the Bible Society. 

Dr. Alfred Williams Anthony had invited Frank Mann to become a member of a Permanent Committee on Financial and Fiduciary Matters that he set up in 1923 for the Home Missions Council.  This important committee soon came under the umbrella of the Federal Council of Churches of Christ in America.  At a national conference of business and charitable organization leaders in 1925 Mann was selected to provide a wide-ranging address entitled “Annuities.”  Mann thus became the first of many Bible Society staff to serve as a national spokesman for the gift annuity movement.   

1925 was also the year that Huggins and Gilbert Darlington helped U.S. charities dodge a bullet by convincing the New York State legislature not to regulate charitable gift annuities as commercial investments.[7]

Change was in the wind throughout the United States in the spring of 1927.  Secretary Ryan gave a very positive report to the Ways and Means Committee regarding a session on “Annuities” at the March 1927 Conference on Financial and Fiduciary Matters, noting that he accepted an invitation from Dr. Anthony to serve on a new Sub-committee on Annuities with the mission of:

Further to study the whole question of annuity contracts, rates, publicity, etc., and to call at a later date a meeting of all parties interested in the issuing of annuity bonds, to try to devise ways and means of closer cooperation.[8]

The Sub-committee would evolve into the Committee on Gift Annuities, predecessor to the American Council on Gift Annuities (ACGA).

Secretary Ryan called attention to something that other charities were doing in their gift annuity programs: hiring full-time planned-giving staff.  The Bible Society was opening up to ideas initiated by their peers:

Increased interest in annuities was very manifest and some denominations are now employing full time secretaries to solicit annuities and legacies and other large gifts.  The Presbyterian Board of Foreign Missions has just inaugurated this system and other denominations are thinking of doing the same.

Ryan’s Sub-committee convened a Conference on Annuities on April 29, 1927.  On May 19, he gave the Ways and Means Committee a lengthy description of the conference proceedings, beginning with George Huggins:

At this conference a detailed report on annuity rates as determined by objective was made by George A. Huggins of Philadelphia, the actuary who made the detailed study of the American Bible Society’s annuities about a year ago.

Ryan carefully summarized the highlights of Huggins’ presentation on the “Actuarial Basis of Rates” for the Committee, and included certain important details in his minutes.  Two points are clear from Ryan’s summary: the ABS Ways and Means Committee had not seen Huggins’ report before the Conference; and Ryan fully intended to follow the standards of practice recommended for all charities issuing gift annuities:

First, that a 70% residuum is a reasonable goal to work toward in the issuing of annuities.  Second, that the rates of annuities should be determined in conformity with this objective, using McClintock’s tables with interest on invested funds calculated at 4½%.  Third, that care should be taken in issuing survivorship annuity bonds not to include more than two persons unless absolutely required by the donor and in all cases, where a survivorship bond is issued, the rate paid should be based upon actuarial tables and not upon the rate of the younger person.

The General Secretary [Ryan] presented to the Committee tables prepared by Mr. Huggins showing comparative rates and other information connected therewith. 

Ryan reported that both he and Darlington made conference presentations, but does not mention their disagreement over Annuity Bond advertising terminology.  He ended his comments to the committee with a strong endorsement of the Conference on Annuities, though his reasons were defensive of ABS policies and practices:

The General Secretary believes that the cooperation of the American Bible Society representatives in this general conference on annuities was exceedingly valuable for the Society because it called to the attention of the different persons present the fact that the American Bible Society has made a scientific study of this question and is issuing annuity bond agreements on a careful, conservative basis.

After Arthur Ryan’s death in June 1927 he was succeeded as ABS Financial Secretary by George William Brown, but the spokesman on gift annuities was clearly Gilbert Darlington, who would lead the Committee on Gift Annuities as Chairman (1939-1959) and Honorary Chairman (1960-1980) – 53 years of volunteer service to the nation’s charities.  

From the 1927 conference to his retirement as Chair of the Committee on Gift Annuities in 1959, Darlington made a series of expert presentations on Federal and state taxation, legislation, and regulation.  Charles W. Baas, who succeeded Darlington as both Treasurer of the Bible Society and as Chair of the Committee on Gift Annuities, wrote a brief chronicle of the Committee in which he credited Darlington as “often the only tax expert available to the Committee” from 1927 to the 1950s: “In partnership with George Huggins, Gilbert Darlington helped lay much of the foundation the Committee is building upon today.”[9]

Charles W. Baas joined the staff of the American Bible Society in 1946 and served as its Treasurer for 41 years.  According to the American Council on Gift Annuities, Baas was the longest-serving Board member of the Committee on Gift Annuities (45 years), presiding as Chair from 1959-1986 including 10 Conferences on Annuities.[10]

Darlington, Baas, and other Bible Society staff provided the Committee on Gift Annuities with extensive administrative support (financial accounting and reporting, mailings, sponsorship database, etc.).  The Committee had no professional staff of its own; it depended entirely upon services provided free of charge by the Bible Society from 1927 to October 1989.  The Annuity Board of the Southern Baptist Convention became the second host of the Committee after 62 years of Bible Society support.[11]

Philanthropic planners owe a tremendous debt to the American Bible Society and its leaders Frank Mann, Arthur Ryan, Gilbert Darlington, and Charles Baas.  The Bible Society captured the attention of the country with its gift annuity campaign in the 1920s, raising millions of dollars for its philanthropic mission and inspiring many other charities to start life-income programs.  The Society then used its considerable influence to advance the professional ethics and financial sophistication of American charities through providing national leadership and administrative support for the Committee on Gift Annuities for more than six decades.          

It was through the Bible Society that George Huggins gained the knowledge of charitable gift annuities he needed to develop a robust financial security system for life-income gifts.  The next part of this series will show why his “Actuarial Basis of Rates” remains the foundation for philanthropic planning and policy-making in the United States.  

Copyright:  This essay is copyrighted under the rules of Creative Commons Attribution 3.0 Unported License.  You are encouraged to redistribute the essays at if you credit me as the author.

Previous Articles:
Calculating Gifts: George A. Huggins and the Conferences on Annuities, 1927-1959
Part 1
Calculating Gifts: George A. Huggins and the Conferences on Annuities, 1927-1959 Part 2
Calculating Gifts: George A. Huggins and the Conference on Annuities, 1927-1959 Part 3.1
Calculating Gifts: George A. Huggins and the Conference on Annuities, 1927-1959 Part 3.2
Calculating Gifts: George A. Huggins and the Conference on Annuities, 1927-1959 Part 3.3

Click here to download Part 3 in its entirity.

[1] Two other reports prepared for the Conference “were not read because of lack of time,” but the Findings Committee decided to include them in the printed Conference report.  Annuity Agreements of Charitable Organizations (1927), page 48.

[2] Financial and Fiduciary Matters: Report of Committee on Findings (March, 1927), page 5.

[3] Arthur C. Ryan, “Administrative Policy,” Annuity Agreements (1927), page 19.  Referring to comments like Ryan’s, Ernest Hall reported at the second Conference on Annuities in 1928 that “It has been the policy of our Board [Foreign Missions of the Presbyterian Church in the U.S.A.] to avoid using the term ‘Bond,’ because in the usually accepted sense of the term it is not a bond.”  “Printing and Advertising,” Conditional Gifts Annuity Agreements (1928), page 24. 

[4] Huggins, “Uniform Rates: Agreements and Terminology: Reserves and Accounting,” Methods and Plans in Using Annuity Agreements (NY: Sub-committee on Annuities of the Committee on Financial and Fiduciary Matters of the Federal Council of the Churches of Christ in America, 1931), Wise Public Giving Series no. 34, page 13.   

[5] At the second Conference on Annuities held in November 1928, Ernest Hall of the Board of Foreign Missions of the Presbyterian Church in the U.S.A. specifically criticized the ethics of the headline “As High as 9%”: “That is the maximum rate which a few old people get.  It is attractive but is misleading, and people who reply to such an advertisement are likely to be disappointed and indignant when they find out what they can actually get . . .  Advertisements put out by religious societies are scrutinized by experts and should conform to the highest ethical standards.”  “Printing and Advertising,” Conditional Gifts: Annuity Agreements of Charitable Organizations (NY: Sub-committee on Annuities of the Committee on Financial and Fiduciary Matters of the Federal Council of the Churches of Christ in America, 1929), Wise Public Giving Series no. 31, page 24.  

[6] Darlington, Rules, Regulations and Reserves in Using Annuity Agreements (NY: Sub-committee on Annuities of the Committee on Financial and Fiduciary Matters of the Federal Council of the Churches of Christ in America, 1931), Wise Public Giving Series no. 38, page 32.

[7] See note 17. 

[8] Minutes dated March 31, 1927.

[9] Baas, Committee on Gift Annuities: A History (NY: Committee on Gift Annuities, 1991), page 73.  Baas describes Darlington as a true Renaissance man, who served as president and chairman of Harbor State Bank; director of the Pan American Trust Company; and Chaplain General of the Naval Order of the United States, among many other accomplishments.   

[10] ACGA in Touch, Vol. 6, no. 2 (Summer 2006), page 1.  Charles William Baas was born in 1920 in Atlantic City, received a B.S. from Rutgers University, an MBA from NYU, and a Litt.D. from Wagner College.  His colleagues insisted on adding Baas’ biography to the roster of “Prime Movers” in his History, including these comments: “Charley Baas’ name is synonymous with the Committee on Gift Annuities for an entire generation of planned giving officers, treasurers, business officers and others who work for charitable organizations throughout the United States . . .  Charley Baas has led, sustained and nurtured the Committee for 45 years.  There will never be another like him.”

[11] Baas, Committee on Gift Annuities: A History, page 93.


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