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  #91  
Old 03-22-2015, 11:12 AM
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http://www.dispatch.com/content/stor...-retirees.html

Quote:
Since Whitley Wyatt retired in 2000 after 33 years as a trucker, he’s collected a pension of $3,300 a month.

Now, the 71-year-old says as much as $2,000 of his monthly check is at risk because of legislation passed by Congress last year that is meant to help underfunded multiemployer pension plans bolster their finances by giving them a way to cut benefits for some retirees.

.....
The Central States Pension that covers Wyatt and other retired Teamsters drivers and other members is among those listed by the federal government as being in “critical and declining” status. A report from the Center of Retirement Research at Boston College found the fund could be insolvent in 12 years.

Many multiemployer funds have suffered in recent years. A big drop in union jobs, investment losses in 2001 and again in 2008, and corporate bankruptcies have left plans with more retirees and fewer workers contributing to plans.

Wyatt worked for four companies under a Teamsters contract covered by the fund, which has 65,000 active workers and 210,000 retirees and survivors. There also are about 133,000 former workers entitled to benefits in the future.

.....
Traditionally, cutting benefits for retirees is something that wouldn’t happen, said Nancy Hwa, spokeswoman for the Pension Rights Center.

“The benefits of people who are already retired usually get the highest level of protection,” she said. “They are retired. The chance of going back to work is lower. ... A lot of them are living on fixed incomes.”

Hwa said right now, there’s no indication of which plans will cut benefits.

.....
Fred Slaybaugh, 71, of Columbus, said it is unclear whether his entire $11,000-a-year pension is at risk given how the legislation is drafted.

Losing the whole pension would put more financial pressure on him and his wife, who have had a lot of medical bills, he said.

“I can’t go out and get another job,” he said.

Wyatt and Slaybaugh acknowledge that the pension fund is in trouble, but said no other solutions were considered that could reduce the risk to retirees, like merging funds or getting companies that participate in the fund to pay more.

“Nobody disagrees there is a problem,” Slaybaugh said. “It’s just the fact that it was rammed through overnight. It wasn’t debated. No one talked about other solutions.”

I'm curious what other solutions they had in mind.

I mean, the prior solution was wait until the pension was put to the PBGC, and as MEPs do not get treated all that generously by the PBGC, get whacked even more. Do I have that right?
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  #92  
Old 03-22-2015, 11:14 AM
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and there was this comment on the story:

Quote:
GREGORI STEINWAY (PAXCHRISTI)

The old Central States Pension Fund, the stomping ground of Jimmy Hoffa, Frank Fitzsimmons, etc. and their mafia buddies that cleaned pension fund money through fictional investments in Las Vegas casinos. It looks like it took a long time, but the multi-employer pension fund is finally being penalized for the past sins of their corrupt leaders. Too bad that it has to affect the hard working truckers who are dependent on that pension fund for their retirement income.
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  #93  
Old 03-22-2015, 12:33 PM
Jeremy Gold Jeremy Gold is offline
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Quote:
Originally Posted by campbell View Post
and there was this comment on the story:
As despicable as mob control of Central States was, it ended forty years ago and is not responsible for current problems.
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  #94  
Old 03-22-2015, 01:03 PM
Jeremy Gold Jeremy Gold is offline
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Quote:
Originally Posted by campbell View Post
http://www.dispatch.com/content/stor...-retirees.html



I'm curious what other solutions they had in mind.

I mean, the prior solution was wait until the pension was put to the PBGC, and as MEPs do not get treated all that generously by the PBGC, get whacked even more. Do I have that right?
The NCCMP was formed of employers, unions, actuaries, lawyers, and lobbyists. It drove the legislation. Their program was outlined in a document called "Solutions, Not Bailouts." It contained few real solutions other than cutting benefits and it did contain some relatively unimportant hidden bailouts. It was constrained by an unmovable position against any overt bailouts of the plans or the PBGC (which has nowhere near the capacity to deliver all of the potential MEP guarantees, even those these are a small fraction of the levels in single employer plans).

PBGC guaranty levels would only cover a small fraction of the average benefit under the Central States plan but would cover a significant portion of the (much smaller) benefits of the Coal Operators MEP.

Not surprisingly, the plans are underfunded for many of the same reasons as the public plans are underfunded. The employers don't want to pay more and the employees didn't want smaller promises, and actuarial assumptions catered to both sides. When PPA put all of the single employer plans on bond-based discount rates, MEPs were still allowed to use EROA.

Important difference from the public plans, however, is that MEPs are funded by multiple employers in troubled industries rather than the entire taxpaying public. Thus push has come to shove more quickly for MEPs.

My testimony last year pointed out that this problem cannot be solved without limiting the continued underfunding of currently accruing benefits. In other words, while trying to deal with the giant hole in the ground, MEPs are still digging.

I don't think that the Congressional no-bailout position is fully justified. Congress wrote the rules that governed these plans at least since 1974 (and back to 1947 as well). Congress set MEP PBGC premiums at unsustainable levels and allowed EROA and extended amortizations in shrinking industries.

ERISA may not have been all that well designed but its message was clear: making good on pension promises was both an employer duty and a societal commitment (PBGC). When it all blows up, has society (via Congress) no responsibility?

I have suggested that there is another approach that, as a taxpayer, I think may be a bargain for me and a better deal for the plans. It contains two parts: (1) get the liability measurement on a market basis and insist that all newly accrued benefits be fully paid for as earned (hedging would be nice too). This would reduce future accruals and increase funding. (2) In exchange for a much more disciplined process and market measurement (i.e., we stop digging immediately), Congress can provide a fractional bailout on our collective behalf. As a taxpayer, I think this tradeoff will cost less in the long run than failure to properly constrain future accruals and funding.

In my testimony, I claimed agnosticism with respect to how much to cut benefits versus increase funding and I was silent on a partial bailout. I focused on proper measurement. This should surprise no one on the AO.
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Old 03-22-2015, 02:50 PM
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So I decided to look up Jeremy's testimony, and I came across this:

http://www.napa-net.org/News/Browse-...ArticleID/3281

Quote:
Additional testimony was presented by Dale Hall, the Society of Actuaries’ Managing Director of Research, primarily regarding the development of new mortality tables; and by Jeremy Gold of Jeremy Gold Pensions, whose central message was that liabilities are understated by as much as 50% and annual costs are underestimated by as much as 100%. “Good policies cannot be based on bad numbers,” Gold said. The final witness was Diane Oakley, Executive Director of the National Institute on Retirement Security (NIRS), who focused on the role of DB plans.

Here was Jeremy's post in this thread on the matter: (if you go back to it, you can see discussion starting there in this thread)
Quote:
Originally Posted by Jeremy Gold View Post
Three actuaries testified in Congress yesterday:

http://waysandmeans.house.gov/calend...EventID=393078

Tully and Hall and I are all actuaries. At one point Scott Henderson of the Kroger Company said: "I am not an actuary but I am surrounded by them," referring to his co-panelists.

Surrounded by actuaries may conjure up a frightening image. After a suitable ransom, we released him.

That link still works -- I just checked it.

Here's Jeremy's testimony:
http://waysandmeans.house.gov/upload...ony_091714.pdf

I did go looking... and there was no Q&A transcript posted that I could see.
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  #96  
Old 03-29-2015, 06:51 PM
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http://triblive.com/news/allegheny/8...#axzz3VoenZ7ti

Quote:
Once considered sacrosanct, many retiree pensions may no longer be secure. A change in federal law passed last year with bipartisan support would allow struggling union pension funds to cut benefits for retirees younger than 75 by as much as 60 percent.
The law applies only to the most severely underfunded private-sector, multi-employer plans, or those that include more than one company's workers.
Declines in union membership and expanding life spans of retirees were threatening the solvency of union pension funds when the financial crisis in 2008 brought huge investment losses.
Some funds recovered. But many have not, and have the option to pull back commitments to individuals who could be more than a decade into retirement.

.....
A ‘FEAR FACTOR' OPTION
There are about 1,400 multi-employer defined benefit pension plans, covering about 10 million participants. The 200 funds that struggle the most cover 1.5 million workers and retirees, including nearly 43,000 covered by plans in Western Pennsylvania.
Rossi's pension is with the Western Pennsylvania Teamsters and Employers Pension Fund, which includes nearly 24,000 people and 140 employers, the largest of which are UPS and Giant Eagle.
That fund is the largest of three in the region that the Department of Labor considers to be in “critical” status, or in danger of running out of money. Those plans must develop a strategy to return to health within 10 years.
Two others are the Laborers Combined Funds of Western Pennsylvania, which has 15,691 participants, and the Southwestern Pennsylvania and Western Maryland Area Teamsters & Employers Pension Fund, whose 3,295 members include workers at UPS and Bimbo Baking USA among others.
The Western Pennsylvania Teamsters fund likely would be among them, according to an analysis by the Center for Retirement Research at Boston College. The center's analysis predicted that fund would be insolvent within 16 years if nothing changes.
The fund's trustees are working with investment managers to improve its finances, but cutting retiree benefits is not on the table, said trustee Joseph Molinero.

.....
The number of retirees collecting benefits continues to expand even as active workers contributing to plans declines. Retirees are living longer — the Society of Actuaries estimated the average 65-year-old man will live 86.6 years, up from 84.6 it estimated in 2000 — and union membership has plummeted in industries such as trucking and construction that are included in the funds.
The Great Recession was devastating to multi-employer pension funds. Funds on average lost 23 percent of their value in 2008, DeFrehn said.
Executives with the Central States pension fund, one of the nation's largest with more than 400,000 participants, say it needs a 12 percent annual return to meet obligations.
“We all know that's not possible,” DeFrehn said. “Without making some changes in the rules that allow those plans that were headed for insolvency to act early, then they were going to have problems.”
Critics say cutting retirees' checks would be premature.
“We're not saying that there isn't a problem with some multi-employer pension funds,” said Karen Friedman, executive vice president and policy director of the Pension Rights Center, a Washington-based advocacy group.

PENSIONS LESS ATTRACTIVE

The Pension Rights Center is pushing to repeal the law and promoting alternative ideas. Some funds could merge and maximize their investment potential, Friedman said. Perhaps employers or the government should be asked to contribute more money.

Friedman acknowledged that a government bailout of pension funds is unlikely because of the unpopularity of bailouts of banks and the auto industry. Raising company contributions would only make the funds less attractive at a time when union influence is diminishing and employers are questioning the value of offering pensions.

“A lot of these plans that are in trouble come from industries where there's been a lot of deunionization,” said Jean-Pierre Aubry of the Center for Retirement Research.

Retirees enjoying a comfortable living with pensions say they could tolerate a decline in monthly checks — but not 60 percent.

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Old 04-22-2015, 12:32 PM
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CENTRAL STATES

http://www.labornotes.org/2015/04/te...k-pension-cuts

Quote:
Teamsters are up in arms over looming pension cuts that could slash the incomes of both current and future retirees—anyone under 80.

They’re battling trustees of the enormous Central States Pension Fund, which has said that cuts of up to 30 percent may be necessary, as soon as possible, to keep from running out of money. Those trustees represent both management and their international union.

At the same time, worker and retiree activists are also battling corporations bent on eliminating pensions altogether. The latest political blow came in December when Congress passed a bill, in the middle of the night, to allow cuts to certain already-earned pensions.

.....
A dozen meetings around the Midwest and South over the last month have attracted 100 to 200 angry members apiece, as activists and local retiree clubs learn their benefits are in danger. The meetings are likely to grow in size and number: Central States has just sent out notices to every member warning that cuts are coming.

Committees have formed in Cleveland, Columbus, the Twin Cities, Milwaukee, Cincinnati, St. Louis, Memphis, and North Carolina. Activists are scheduling meetings with their Congresspeople and writing them letters, leafleting and raising questions at local union meetings and Teamster retiree clubs, and pestering the Teamsters International to do something.

An April 8 rally near Chicago, outside a meeting called by Central States officials to inform Teamster local officers, drew 150 members from eight states, including as far away as Georgia.

Amsden says the average Central States pension is $1,230 a month ($14,760 a year). “You take 30 percent of that away and what will they have to live on?” he asks.

Politicians say they don't want to pay for a “bailout” of the fund, but Amsden predicts, “They are going to bail us out one way or another. People who never expected any government assistance in their life, they’re going to have to go for food stamps.”

For those with decent pensions—some make $36,000 a year—the cuts could be as high as 65 percent, said Mike Walden, a 31-year Roadway driver who founded the northeast Ohio group.

.....
VOTING ON THE PERPS

Pensions will certainly be an issue in the 2016 election for top Teamster officers, as President James Hoffa and his officers back the cuts and challengers Tim Sylvester and Fred Zuckerman blame Hoffa for the decline of the Fund.

In the last officers’ election only 300,000 of the 1.3 million Teamsters voted, with two challengers receiving a combined 41 percent of the vote. So the 65,000 working Central States Teamsters could prove a formidable voting bloc.

The officers sometimes try to have it both ways. At the April 8 Chicago rally against the cuts, International Vice President John Murphy showed up to praise the demonstrators and claim Hoffa was on their side. Meanwhile, inside the Central States meeting, international representatives were telling local officers the cuts were mandatory.

Walden says his many calls to Teamster headquarters have gone unreturned. “As far as transparency and communication, they’re avoiding us,” he said.

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Old 04-30-2015, 04:25 PM
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http://edworkforce.house.gov/news/do...umentID=398799

Quote:
Time to Modernize Multiemployer Pension System

WASHINGTON, D.C. | April 29, 2015 -
The Subcommittee on Health, Employment, Labor, and Pensions, chaired by Rep. Phil Roe (R-TN), today held a hearing to discuss ways to further strengthen the multiemployer pension system. The hearing, entitled, “Examining Reforms to Modernize the Multiemployer Pension System," follows a bipartisan proposal enacted into law last year that includes policies to shore up the federal backstop for multiemployer plans and provide the trustees of these plans new tools to avoid insolvency.

“Today’s hearing represents the next step in a long process to strengthen the retirement security of America’s workers,” remarked Chairman Roe. “This effort began more than three years ago for a simple reason: A pension crisis threatened the well-being of countless workers, employers, and retirees, as well as American taxpayers ... Through our continued oversight, it has become abundantly clear that workers need new options to help plan for their retirement.”

“We need new tools in our toolbox to address the challenges which were not contemplated when multiemployer pension rules were initially put in place,” said Andrew Scoggin, Vice President of Albertson’s LLC. “Congress needs to equip employers and employees with the regulatory flexibility necessary to make changes to benefits programs that do not run afoul of beneficiaries, their employers, or the system as a whole.”

To help accomplish this goal, in 2013, the National Coordinating Committee for Multiemployer Plans (NCCMP) released a proposal that would allow for the creation of so-called “composite” plans. These innovative plans would combine aspects of both defined benefit and defined contribution plans to deliver annuitized, lifetime income without the drawbacks associated with traditional multiemployer plans.

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Old 05-09-2015, 12:46 PM
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Email from the Academy

Quote:
PBGC Reopens Visiting Actuary Program, Invites Applications from Academy Members

The Pension Benefit Guaranty Corporation (PBGC) is reopening its Visiting Actuary program with an invitation to Academy members who have relevant experience and a desire to perform public service to apply for a paid position focused on the implementation and interpretation of the Multiemployer Pension Reform Act (MPRA) and emerging multiemployer policy and legislation. The agency is looking for a senior multiemployer consulting actuary who will have the ability to contribute at a senior level within the agency during a time of great change for multiemployer plans. The position reports directly to the head of the Policy, Research and Analysis Department and is anticipated to have broad exposure to senior leaders throughout the agency and other agencies involved in implementation of MPRA. The Visiting Actuary program has provided opportunities for practitioners to take a year or two and contribute their knowledge, experience and ideas to ensure that regulation and policy reflect a sound understanding of practice. After the Visiting Actuary term is up, many actuaries have remained in public service while others have returned to the private sector.
link to application:
https://www.usajobs.gov/GetJob/ViewDetails/403240700
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Old 05-21-2015, 11:07 AM
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TEAMSTERS

http://www.washingtontimes.com/news/...-preparing-to/

Quote:
The Teamsters have begun informing retirees and current workers that their pension benefits may soon be cut, the final ironic twist to a lobbying campaign that saw the union spend its own members’ dollars to win the right to shrink their retirement pay.

The somber notifications began going out from the Teamsters Central States Health and Welfare Pension Fund this spring, a decision that could ultimately affect 410,000 current pension participants and a total of more than 10 million U.S. workers nationwide. Cuts could begin as early as next year.

The cuts were made possible after the lame-duck Congress late last year passed the Multiemployer Pension Reform Act (MPRA), enabling any multiemployer pension fund to cut benefits to workers and current retirees if the plan is underfunded by at least 20 percent.

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