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Old 12-18-2016, 08:06 AM
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Mary Pat Campbell
Join Date: Nov 2003
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Breaking News: Fifth Union Plan Gets MPRA Letter

On September 25, 2015 the Central States Pension Plan was the first multiemployer plan to apply to the Treasury Department to reduce benefits under the Multiemployer Pension Reform Act of 2014 (MPRA). On May 6, 2016 that application was denied.
March 15, 2016 – Road Carriers Local 707 Pension Fund also applied. June 24, 2016 – denied.
March 26, 2016 – Ironworkers Local 16 Pension Plan applied. November 3, 2016 – denied
November 10, 2016 – Teamsters Local 469 Pension Fund out of Hazlet, New Jersey which applied first on 12/28/15 but withdrew that application and refiled on 3/31/16 – denied
Today the Ironworkers Local 17 Pension Fund got their letter….

So what happens next? According to the PBGC FAQs on MPRA:
If the trustees’ application to reduce benefits is approved by the Treasury Department, in consultation with PBGC and the Department of Labor, those participants and beneficiaries have the right to vote on the proposed benefit changes before they occur. A statement from the plan trustees in support of the benefit reductions and a statement, based on public comments, in opposition to the benefit reductions are both required to be included on the ballot that is provided for the vote.
For most multiemployer pension plans, Kline-Miller requires that if the majority of all participants and beneficiaries in the plan vote against benefit reductions, they cannot occur. However, the trustees could submit a new application to reduce benefits and start the process again.
The Treasury Department has published proposed and temporary regulations detailing the application review process, which are currently posted online for public comment.
Different rule for large plans:
There is a different rule for large and financially troubled multiemployer plans (referred to as “systemically important plans”). These are plans that would require PBGC assistance valued at more than $1 billion if the proposed reductions in benefits are not implemented. Even if a majority of the participants and beneficiaries covered by one of these large and financially troubled plans vote against the proposed benefit reductions, the Treasury Department is required by Congress to permit the implementation of such benefit reductions or a modified version of such reductions.
The Ironworkers Local 17 Pension Fund is definitely financially troubled as they report having a funded ratio of 23.91% as of 5/1/14 but the unfunded liabilities only come to $276,387,077 so a vote might mean something.
Their application material is here:

They had withdrawn and resubmitted, perhaps in light of the prior rejections

Let's see if I can find a couple of the changes.

Actuarial projections here:

Post-September 30, 2015 annual investment returns for deterministic projections are assumed to
be as follows:

Plan Year
Beginning May 1 Return
Plan Year
Beginning May 1 Return
Plan Year
Beginning May 1 Return
2015 3.96% 2029 7.52% 2043 7.88%
2016 4.75% 2030 7.78% 2044 7.89%
2017 5.35% 2031 7.80% 2045 7.89%
2018 5.80% 2032 7.81% 2046 7.89%
2019 6.13% 2033 7.82% 2047 7.90%
2020 6.38% 2034 7.83% 2048 7.90%
2021 6.57% 2035 7.84% 2049 7.90%
2022 6.71% 2036 7.85% 2050 7.91%
2023 6.82% 2037 7.85% 2051 7.91%
2024 6.90% 2038 7.86% 2052 7.91%
2025 7.38% 2039 7.87% 2053 7.91%
2026 7.43% 2040 7.87% 2054 7.92%
2027 7.47% 2041 7.88%
2028 7.50% 2042 7.88%
Sorry so ugly, what's interesting to me is the crappy returns early on, ramping up towards 8%

But looking at some of the other pages, showing examples of what the vuts would be and for who, and there's more here:

It can be that the more conservative return assumptions helped this get approved, but also a demonstration that not all benefits need to be cut down to PBGC guarantee levels, etc.

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