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  #571  
Old 09-25-2018, 11:43 PM
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Mary Pat Campbell
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https://burypensions.wordpress.com/2...ing-ignorance/

Quote:
HSI(3): “Stunning Ignorance”
Spoiler:
Horizon Actuarial Services, LLC (HAS) in their letter to the Bailout Committee criticized this testimony of Joshua Rauh:

15. “Trustees had decades to undertake voluntary, remedial measures before resorting to trying to force participants to take cuts against promised benefits under the Multiemployer Pension Reform Act of 2014 (MPRA). Before reaching this point, they failed to use the many options that were at their disposal to ensure the solvency of plans. They have always had the right to gradually require greater contributions from employers, to make more realistic assumptions about investment returns, and to make more affordable benefit promises on a prospective basis.”

Does not seem too far out there but HAS went ballistic:

These statements display a stunning ignorance of how multiemployer plans have dealt with funding issues over the past several decades. As noted previously, many, if not most, of the problems faced by these plans were caused by economic and demographic events out of the control of trustees and their professional advisors. We can provide countless examples of plans that did exactly what Mr. Rauh accuses these plans of not doing: taking voluntary remedial actions, redesigning benefits, and gradually increasing contributions, all under reasonable assumptions. As an example, from 2006 to 2015 the median contribution rate per active plan participant increased by 93% (much of that increase in response to the 2008 Great Recession), while the National Average Wage Index increased just 24% over the same period. During the same period, benefit accrual rates remained level or decreased for most plans. Trustees, participants, and employers all make sacrifices to address funding problems.

I would point out:

Perhaps some multiemployer plans took remedial action but obviously it was not enough (hence the current necessity for a mass bailout).
Single employer plans certainly faced similar economic events and some of the demographic ones but managed to keep their funded ratios respectable (albeit with a lot of help from stricter funding rules and PBGC’s need for cash).
Professional advisors would anticipate a recession (especially after 10 years) while advisors likely to be hired by trustees anxious to low-ball contributions simply anticipate what their clients want to hear.

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Old 09-28-2018, 12:37 PM
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Mary Pat Campbell
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BAILOUT

https://burypensions.wordpress.com/2...out-committee/

Quote:
AAA to Bailout Committee
Spoiler:
The Joint Select Committee on the Solvency of Multiemployer Pension Plans (Bailout Committee)has been hearing from several fronts on the wisdom of bailing out severely underfunded multiemployer plans so that participants will not have to have their benefits cut (further). Within the actuarial community the most influential voice may be that of the American Academy of Actuaries (AAA) which sent out their letter yesterday. Excerpts follow:


Please also note that this letter focuses on solutions for distressed plans facing projected insolvency. It does not address possible changes to funding requirements for multiemployer pension plans or other measures designed to prevent a new solvency crisis from arising in the future.

Additional funding for the PBGC’s multiemployer program would enable the PBGC to more effectively take part in a broad solution to stabilize the overall system. The most direct way for Congress to improve the financial strength of the PBGC would be to increase the current premium level.

Another way to increase funding to PBGC’s multiemployer program is to deduct premium payments from benefit payments made to participants in all plans covered by the program. Currently, multiemployer pension plans pay more than $40 billion per year in benefits to retired participants and their beneficiaries, and this number is projected to rise in the coming decades. A premium equal to a small percentage of the system wide benefit payments could generate significant additional revenue for PBGC’s multiemployer program without significantly reducing retirees’ benefits.

Direct federal funding could also be part of a plan to improve PBGC finances. Multiemployer plans governed by applicable laws and regulations over the past few decades may in retrospect have been placed in circumstances with insufficient tools and resources to prevent the current funding crisis. Certain aspects of the rules, such as the tax deduction limits on plans considered to be overfunded and the ability for plan sponsors to use investment gains to offset the costs of new benefit accruals, may have contributed to the financial difficulties facing troubled plans, thereby creating the current crisis. The role of past funding rules and regulations in contributing to – or at a minimum failing to prevent – the current funding challenges would seem to support the notion of federal funds being used as part of the overall solution.

The Committee could also consider whether the PBGC should have broader authority to proactively restructure distressed plans to enable them to remain solvent.

My questions:

How many of the distressed plans facing insolvency were impacted by tax deduction limits on overfunded plans?
Wouldn’t it be helpful if the AAA explained how these underfunded plans developed due to flawed funding rules (unrelated to limits on overfunded plans)?

Letter:
http://www.actuary.org/files/publica...r_09262018.pdf
Quote:
September 26, 2018
Mr. Chris Allen
Senior Advisor for Benefits and Exempt Organizations
United States Senate, Committee on Finance
Mr. Gideon Bragin
Senior Tax and Pensions Policy Advisor
United States Senator Sherrod Brown
Re: Follow-Up from June 22, 2018, Meeting
Spoiler:
Dear Mr. Allen and Mr. Bragin,
On behalf of the American Academy of Actuaries1 Pension Practice Council, we thank you, the
staff of the Joint Select Committee on Solvency of Multiemployer Pension Plans (the
Committee), and its members for the opportunity to meet with you on June 22, 2018. We hope
you found the discussion on possible solutions for the current multiemployer solvency crisis—as
well as to stabilize the overall system going forward—to be helpful.
Our discussion touched on many concepts that could be components of a broader approach to
stabilize the multiemployer pension system. As requested, we have prepared this letter to
summarize and expand upon the points we covered. Please note that the American Academy of
Actuaries Pension Practice Council neither endorses nor opposes any specific multiemployer
pension reform proposals, including the concepts described in this letter. We do, however,
believe continued discussion of all potential courses of action could be beneficial as the
Committee develops a recommendation for a solution to address the financial challenges facing
the multiemployer pension system.

1 The American Academy of Actuaries is a 19,500-member professional association whose mission is to serve the
public and the U.S. actuarial profession. For more than 50 years, the Academy has assisted public policymakers on
all levels by providing leadership, objective expertise, and actuarial advice on risk and financial security issues. The
Academy also sets qualification, practice, and professionalism standards for actuaries in the United States.
2
1850 M Street NW Suite 300 Washington, DC 20036 Telephone 202 223 8196 Facsimile 202 872 1948 www.actuary.org
Please also note that this letter focuses on solutions for distressed plans facing projected
insolvency. It does not address possible changes to funding requirements for multiemployer
pension plans or other measures designed to prevent a new solvency crisis from arising in the
future. We recognize that these matters are key to developing a comprehensive approach, and we
would very much appreciate the opportunity to further discuss proposed options to address those
challenges with you.
Loan Program for Distressed Multiemployer Plans
Much of our discussion at our June meeting pertained to a possible federally backed loan
program that would enable troubled plans to avoid insolvency. The key points we discussed on
that topic are described in our issue brief, Loan Programs for Underfunded Multiemployer Plans,
which was published in May 4 of this year.
2 To briefly recap, a loan program could protect
participant benefits by helping distressed multiemployer plans return to sound financial footing.
However, such a program would also entail costs and risks borne by the taxpayers, and the actual
cost of the loan program would not be known until many years in the future.
We would welcome the opportunity to further discuss with the Committee how a loan program
could be designed and implemented.
Strengthening PBGC’s Multiemployer Insurance Program
Under the Multiemployer Pension Reform Act of 2014 (MPRA), the Pension Benefit Guaranty
Corporation (PBGC) received expanded authority to restructure distressed multiemployer plans
to avoid insolvency, either by partitioning liabilities or by providing financial assistance to
facilitate plan mergers. Unfortunately, PBGC’s own financial limitations have prevented it from
extensively using this authority to help reverse the current solvency crisis.3 Additional funding
for the PBGC’s multiemployer program would enable the PBGC to more effectively take part in
a broad solution to stabilize the overall system.
The most direct way for Congress to improve the financial strength of the PBGC would be to
increase the current premium level. While we have not analyzed the impact of higher premium
levels specifically on plans, we note that when evaluating the possibility of further premium
increases, it is important for the Committee to consider the costs to plans. Specifically, healthier

2 Link: https://www.actuary.org/files/public...MultiPlans.pdf
3 The PBGC projects its multiemployer program deficit to be at least $80 billion. This amount represents the
PBGC’s unfunded liability with respect to providing guaranteed benefits to plans projected to become insolvent in
the next 20 years. The PBGC estimates that premium revenue would need to be increased sixfold to eliminate this
deficit and to forestall the insolvency of the multiemployer program.
3
1850 M Street NW Suite 300 Washington, DC 20036 Telephone 202 223 8196 Facsimile 202 872 1948 www.actuary.org
plans or plans in industries with higher wage packages may better be able to adjust to higher
premiums than poorly funded plans or plans in industries with lower wage levels. One way to
address the issue of affordability would be to tie any modified premium structure to plan
contribution levels. For example, a plan’s premiums could be limited to a fixed percentage of the
employer contributions the plan receives.
Another way to increase funding to PBGC’s multiemployer program is to deduct premium
payments from benefit payments made to participants in all plans covered by the program.
Currently, multiemployer pension plans pay more than $40 billion per year in benefits to retired
participants and their beneficiaries, and this number is projected to rise in the coming decades. A
premium equal to a small percentage of the systemwide benefit payments could generate
significant additional revenue for PBGC’s multiemployer program without significantly reducing
retirees’ benefits.
4
Direct federal funding could also be part of a plan to improve PBGC finances. Multiemployer
plans governed by applicable laws and regulations over the past few decades may in retrospect
have been placed in circumstances with insufficient tools and resources to prevent the current
funding crisis. Certain aspects of the rules, such as the tax deduction limits on plans considered
to be overfunded and the ability for plan sponsors to use investment gains to offset the costs of
new benefit accruals, may have contributed to the financial difficulties facing troubled plans,
thereby creating the current crisis. The role of past funding rules and regulations in contributing
to—or at a minimum failing to prevent—the current funding challenges would seem to support
the notion of federal funds being used as part of the overall solution.
Authorizing PBGC to Restructure Distressed Multiemployer Plans
Under current law, the PBGC’s actions related to restructuring multiemployer plans are limited
to situations when (a) a plan terminates or becomes insolvent, or (b) a plan in critical and
declining status applies for financial assistance from the PBGC in the form of a partition or a
facilitated merger, as permitted under MPRA.
5 The Committee could also consider whether the
PBGC should have broader authority to proactively restructure distressed plans to enable them to
remain solvent. If paired with additional funding, this expanded authority could provide a way
for the agency to use its resources to assist a large number of distressed plans.

4 The cost of the insurance that the PBGC has historically provided has exceeded the premiums that were charged.
From this perspective, premium payments that are deducted from current benefit payments, it could be argued,
would partially reconcile the gap between past insurance costs and premiums.
5 Under current law, PBGC’s multiemployer program operates very differently from the single-employer program.
Notably, in the single-employer program the PBGC has broad authority to intervene in underfunded plans long
before they are in danger of insolvency.
4
1850 M Street NW Suite 300 Washington, DC 20036 Telephone 202 223 8196 Facsimile 202 872 1948 www.actuary.org
One way the PBGC could restructure plans is through expanded use of partitions. Under current
partition rules, a plan that receives a partition from the PBGC must reduce benefits to the
maximum extent permissible under MPRA. Rules that expanded the PBGC’s partition authority
could also relax this requirement, thus enabling the PBGC to use its resources to preserve
participant benefits to the greatest extent possible. Additionally, any changes to partition rules
could consider which participants may be included in a partition. For example, prior to MPRA,
only certain participants (often referred to as “orphans”)
6
could be included in a partition. Under
MPRA, however, the PBGC’s authority to partition was expanded to potentially include any
participant.
As under current law, another way in which the PBGC could restructure a distressed plan is by
providing financial assistance to facilitate a merger with a healthy plan. However, MPRA
appears to create a technical issue with this approach by requiring that a suspension of benefits
be lifted following such a merger, based on interpretations of the applicable statute by the
Department of Treasury. An expansion of the facilitated merger rules could remove this
requirement and allow the PBGC greater latitude in determining when a facilitated merger is in
the best interest of plan participants and the financial health of the PBGC.
Even if the PBGC’s resources are significantly increased, the Committee could consider placing
limitations on the financial assistance the PBGC may provide as part of a plan restructuring,
similar to those that exist under current law. Notably, under current law, financial assistance
provided by the PBGC must reduce its projected long-term loss with respect to the plan.
Additionally, the financial assistance provided to a distressed plan must not impair the PBGC’s
ability to meet its existing financial assistance obligations with respect to other distressed plans.
These goals could be incorporated into a solution that expands the PBGC’s authority to
restructure plans.
The Committee might also consider whether eligibility for restructuring should be expanded
beyond plans that are in critical and declining status to other plans that are distressed but not
necessarily projected to become insolvent in the next 20 years. For example, it may be
appropriate to permit the restructuring of a plan in critical (but not declining) status if it is
operating under a rehabilitation plan designed to forestall insolvency rather than eventually
emerge from critical status.
The Committee might also consider a structure that permits plan sponsors to engage with the
PBGC early in a process to develop an acceptable restructuring plan. As recent experience with
applications under MPRA has shown, restricting active discussion between plan sponsors and the
reviewing agencies can increase the time and cost of the application and review process, as well
as create uncertainty for workers, retirees, and employers. With flexibility, the PBGC and plan

6 Prior to the passage of MPRA, an “orphan” participant was one whose employer had previously withdrawn from
the plan and not fully paid its withdrawal liability.
5
1850 M Street NW Suite 300 Washington, DC 20036 Telephone 202 223 8196 Facsimile 202 872 1948 www.actuary.org
sponsors could work together to make adjustments to restructuring proposals before they are
implemented, instead of requiring that plan sponsors withdraw and resubmit applications.
In some situations, a plan sponsor might view immediate restructuring as a worse option for its
participants than becoming insolvent years later and having benefits reduced to PBGC guarantee
levels—perhaps reaching this conclusion after engaging in restructuring discussions with the
PBGC. The Committee might consider under what circumstances the sponsor of a distressed plan
may be permitted to decline restructuring and become insolvent, or under what circumstances the
PBGC may be authorized to compel restructuring. The magnitude of the additional loss to the
PBGC that would result from the plan becoming insolvent could be a factor in this
determination.
The Committee also might consider to what extent plans that have already implemented a
suspension of benefits under MPRA would be eligible for retroactive restructuring under an
expansion of the PBGC’s authority. For example, the sponsor of a plan that has previously
suspended benefits could be permitted to engage the PBGC to determine what financial
assistance, if any, the PBGC may be able to provide to the plan. Such financial assistance could
enable the plan sponsor to implement a partial restoration of suspended benefits.
Making Plan Benefits Adjustable as Part of Restructuring
The relief measures to improve the financial health of a distressed plan will necessarily consist of
some combination of additional funding sources, benefit reductions, or both. One objective of a
relief program is to keep both the amount of additional funding and severity of benefit reductions
as small as possible. Another important objective is for the ongoing plan to have an acceptably
high probability of avoiding insolvency in the future—while facing the risks of investment
volatility and contribution uncertainty—without the need for further financial assistance.
To balance these objectives, the Committee might consider whether accrued plan benefits should
become adjustable after restructuring.7 Making accrued benefits adjustable after a restructuring
would increase the likelihood that the ongoing plan will remain solvent without the need for
further financial assistance. It would also lessen the upfront benefit reductions and could reduce
the financial assistance needed to implement a relief or restructuring program.
Furthermore, if the PBGC provides financial assistance to a distressed plan as part of a
restructuring, the transaction could be viewed as the PBGC settling its obligations with the plan.
In other words, after the plan is restructured, its benefits become adjustable, and PBGC

7 Making accrued benefits “adjustable” means the amount payable in future years could go down or up, depending
on investment returns on plan assets or other plan experience.
6
1850 M Street NW Suite 300 Washington, DC 20036 Telephone 202 223 8196 Facsimile 202 872 1948 www.actuary.org
guarantees no longer apply. After restructuring, the plan sponsor would be solely responsible for
managing risks and paying participant benefits, with no further PBGC backstop. This notion
could support the concept of making benefits adjustable after restructuring, without further
PBGC coverage.
Benefit adjustments could be implemented in various ways. For example, if only a portion of
participant benefits were subject to adjustments, or if there were a floor on the maximum amount
of downward adjustments, the likelihood of the plan remaining solvent after restructuring would
be significantly increased. With respect to the mechanics of future adjustments, one possibility is
that the adjustments could be calculated automatically in accordance with a numerical formula
based on the plan’s investment returns or funding levels. Another possibility is that adjustments
could be implemented at the discretion of the plan sponsor, subject to prescribed guidelines.
Closing
We again thank the Joint Select Committee on Solvency of Multiemployer Pension Plans and its
members for the opportunity to offer our expertise and objective actuarial analysis on this
important matter. We remain ready to provide further input to the Committee on the actuarial
aspects of potential solutions to stabilize the multiemployer pension system, now and in the
future.
If you have any questions or need additional information, please contact Monica Konaté,
Academy pension policy analyst, at konate@actuary.org.

Sincerely,
Theodore Goldman, MAAA, FSA, EA
Senior Pension Fellow
Ellen Kleinstuber, MAAA, FSA, EA
Chairperson, Pension Committee
Jason Russell, MAAA, FSA, EA
Chairperson, Multiemployer Plans Committee
Joshua Shapiro, MAAA, FSA, EA
Vice President, Pension Practice Council
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  #573  
Old 09-28-2018, 04:06 PM
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Mary Pat Campbell
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https://www.realclearpolicy.com/arti...er_110804.html

Quote:
'Multiemployer' Pension Hole Keeps Getting Deeper

Spoiler:
The first rule of holes, say the people who set such rules, is to stop digging. But when it comes to so-called “multiemployer pensions,” which face $600 billion in funding shortfalls, 168 bipartisan members of Congress have shovel in hand, ready to gamble tens of billions of taxpayer money to keep these plans afloat. Multiemployer pensions need help, but first they need a hard look at how they got where they are.

Most pensions are “single-employer” plans, meaning that a single company sponsors a pension for its own employees. By contrast, a multiemployer pension is a joint enterprise between a labor union and multiple employers within the same industry. For instance, the Central States Plan covers 400,000 workers and retirees from 1,400 different employers in the trucking industry and is jointly administered by those employers and the Teamsters union.


Some large but deeply underfunded plans like Central States could run out of money within a decade. The Pension Benefit Guaranty Corporation would protect retirees’ benefits only up to $12,870 per year. Worse, the PBGC is itself underfunded, such that even a single large insolvency could bankrupt the agency. In response, Congress has set up a Joint Select Committee tasked with crafting a solution by November 30.

How did things get so bad? The story usually involves so-called “orphaned liabilities.” These are benefits owed to participants whose employers either went bankrupt or withdrew from the plan. Multiemployer pensions require that remaining employers take responsibility for these orphaned liabilities, a requirement that has overwhelmed the plans. In this view, the insolvency of multiemployer pensions is something the pension administrators could neither have foreseen nor prevented.

But the true story is that, due to lax federal funding rules, multiemployer pensions never fully funded their benefits in the first place. Instead, multiemployer pensions operated under funding rules that allowed plans to credit themselves with risky investment returns before those returns materialized. Multiemployer plans set their contribution rates on the assumption that plan investments would earn roughly 7.5 percent annual returns, forever. That kept contributions low, but it also meant that if one participating employer went bankrupt or withdrew, the remaining employers were on the hook for guaranteeing 7.5 percent investments returns on the plan’s assets in all future years. No Wall Street firm would provide that kind of guarantee absent a hefty fee. As it happens, from 1996 through 2016 multiemployer pensions received investment returns roughly one percentage point below their assumed rates, according to Stanford economist Joshua Rauh. The results have been disastrous.

Make no mistake: These were the funding rules that multiemployer pensions lobbied Congress for and want maintained in the future. But they are rules that, with the exception of U.S. state and local government employee pensions — themselves underfunded by multiple trillions of dollar — are very uncommon in the pension world. Almost all other pensions must fund themselves using conservative assumptions of investment returns. Single-employer pensions in the U.S., for example, assume a corporate bond yield of about 4.0 percent.

In addition, in most other contexts pensions are required to address any unfunded liabilities quickly. Single-employer plans must generally move back to full funding in seven years, while multiemployer plans are allowed 30 years to pay off any unfunded liabilities. Stricter pension funding requirements mean higher upfront contributions. Unions didn’t want this, since the money might come out of employees’ pay raises, and employers themselves wanted to keep contributions low. But true full funding comes with an important advantage: Employees’ benefits are safe even if the sponsoring employer goes bankrupt.

The Butch Lewis Act, the proposed legislation to rescue multiemployer plans, adopts what state and local government call a “pension obligation bond.” The pension sponsor borrows at a low rate, then invests in risky assets in hopes of receiving higher returns. Chicago is currently considering a $10 billion bond offering, which has been greeted with a mixture of derision and alarm. The Butch Lewis Act would go further: Since no private entity would lend to underfunded multiemployer plans, the federal government does the lending. If the plans can’t repay, the federal government eats the loss. The Butch Lewis Act’s sponsors the are touting an unreleased Congressional Budget Office estimate that the Act would cost “only” $34billion over the first decade.

The retirees threatened by multiemployer pension insolvency are themselves blameless. They’re also members of a powerful Democratic Party constituency primarily located in Midwest swing states. Add it all together and a bailout may be inevitable. But that bailout should at least nod in the direction of good public policy. While other reforms to the PBGC are needed, I have four ideas with regard to how multiemployer pensions requesting federal assistance should be treated.

First, any multiemployer plan seeking federal help should be taken over by the PBGC. The managers and trustees of these plans — some of whom are highly-paid — were tasked with looking out for pension participants and could have done more to address underfunding. It should be clear to everyone — pension participants, employers, unions, and Congress — that this is a pension disaster, not business as usual. Putting failing plans in receivership helps convey that message.

Second, multiemployer plans should no longer be exempted from the more stringent funding standards required for single-employer plans, which include lower discount rates and less tolerance for long-term unfunded liabilities. It is clear that the original justification for looser funding standards — that multiple employers banding together could effectively self-insure pension liabilities — was mistaken. If plans cannot survive on those terms, they should be frozen before inflicting greater losses on retirees and taxpayers.

Third, any multiemployer plan seeking federal assistance should immediately freeze the accrual of new benefits and switch employees to 401(k)s to which both employees and employers contribute. That’s standard practice when a single-employer pension turns to the PBGC for help. According to PGBG data, the Central States plan continues to promise new benefits equal to 20 percent of workers’ wages, over six times more generous than the typical employer contribution to 401(k)s. Currently, nearly two-thirds of contributions made by deeply underfunded multiemployer plans simply cover newly earned benefits, which is crazy for plans on the brink of insolvency.

Freezing accruals would free up money to pay current benefits. The Butch Lewis Act allows insolvent multiemployer pensions to continue promising those generous new benefits, even as plans rely on federal aid to pay benefits to current retirees. Since employees do not themselves contribute to multiemployer plans, there is no reason even from a cash-flow basis to continue promising new benefits.

Fourth, after these preceding steps, retirees should have their benefits protected, but not without limit. Retirees in single-employer pensions, which operate under much stricter funding rules, do not receive unlimited PBGC protection. And 401(k) holders certainly don’t get a bailout if their accounts crash. Yes, promises were made to multiemployer plan participants, but by employers and unions, not the federal government. Lower-income retirees should receive most of their benefits, but there must be real cuts as benefits rise.

Multiemployer pensions could have been more prudent by contributing more and taking less investment risk; they chose not to be. Multiemployer pensions weren’t struck by lightning, but by a lack of preparation enabled by lax federal regulation. The Butch Lewis Act proposes to respond with a bailout that adopts one of the worst financing practices of state and local government. Retirees deserve protection, but surely we can do better than this.

Andrew G. Biggs is a resident scholar at the American Enterprise Institute.


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Old 10-04-2018, 04:54 PM
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https://burypensions.wordpress.com/2...ere-were-nine/

Quote:
MPRA Withdrawal: And Then There Were Nine
Spoiler:
Earlier this year the Pressroom Unions Pension Trust Fund of New York, NY filed for benefit suspensions under MPRA. This week they withdrew that application.

From their latest 5500:


Plan Name: Pressroom Unions Pension Trust Fund
EIN/PN: 13-6152896/001
Total participants @ 9/30/16: 1,762 including:
Retirees: 1,328
Separated but entitled to benefits: 348
Still working: 86

Asset Value (Market) @ 10/1/16: $133,297,901
Value of liabilities using RPA rate (3.08%) @ 10/1/16: $240,951,446 including:
Retirees: $179,219,035
Separated but entitled to benefits: $53,558,112
Still working: $8,174,299

Funded ratio: 55.32%
Unfunded Liabilities as of 10/1/15: $107,653,545

Asset Value (Market) as of 9/30/16: $134,081,769
Contributions (MB): $276,524
Contributions (H): $226,692
Payouts: $14,588,367
Expenses: $1,066,244

There are now nine plans still under review:

Laborers No. 265 Pension Plan
Local 805 Ibt Pension & Retirement Plan Second Application
Local 807 Labor Management Pension Fund
Mid-Jersey Trucking Industry and Local 701 Pension Fund
Southwest Ohio Regional Council of Carpenters Second Application
Toledo Roofers Local No 134 Pension Plan
Plasterers & Cement Masons Local 94 & Pension Fund
Plasterers Local #82 Pension Plan
Sheet Metal Workers Local Pension Fund (OH)

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Old 10-08-2018, 03:13 PM
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Mary Pat Campbell
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BAILOUT

https://dailycaller.com/2018/10/05/u...ilities-crash/
Quote:
OPINION: POTENTIAL CRASH WORSE THAN 2008? UNFUNDED PENSION LIABILITIES COULD BE TO BLAME

Spoiler:
With all the good economic news — stock market highs, record employment and consumer optimism, rising wages, and falling poverty rates — there is on the horizon a dark cloud that could endanger everything.

Multi-employer pension plans have more than $600 billion of unfunded liabilities and are dangerously close to failing. Once these endangered plans fail, others may not be far behind.

State and local governments have about $6 trillion in unfunded pension promises. If these potential failures come to fruition, it could be a disaster far worse than the 2008 housing bust. Before that housing bust, the economy appeared strong and few anticipated an economic meltdown.

But even if one is determined to ignore the trouble signs, any pension plan failure will have a very real human cost and an obvious cost to taxpayers. As pension plans fail, Americans who have worked and been taxpayers their entire adult life will be forced onto welfare rolls — food stamps, welfare payments, housing aid, and disability benefits.


We saw welfare programs dramatically grow in the aftermath of the 2008 housing bust. Vast numbers of Americans becoming welfare recipients rather than taxpayers would be a real tragedy.

The good news is that this situation is entirely preventable — if Congress makes the necessary pension reforms in a timely fashion. Conservatives would be foolish to do nothing and allow this pension problem to become a crisis because once the crisis hits, it will be used to exponentially grow big government and waste trillions in bailouts and giveaways.

We can never forget how the advocates of big, bloated government view dire circumstances. Remember Rahm Emanuel’s words, “You never want a serious crisis to go to waste.”

It would be short-sighted for conservatives to do nothing or to delay. Once the crisis hits, the herd mentality will be too strong, and the political pressure too great. Big government solutions and crazy spending will be enacted despite conservative objections. That’s exactly what happened in 2009.

The conservative thing to do is to use conservative solutions to prevent this problem from becoming a disaster. Fortunately, conservatives are coalescing around a solution that will eliminate the risk: (i) that our robust economy falters, and (ii) that millions of American taxpayers will be forced into becoming welfare recipients, and (iii) that government will waste trillions in bogus bailouts.

Conservative organizations like Frontiers of Freedom and Americans for Limited Government and others are advocating that conservatives in Congress find a solution — protecting both the economy and taxpayers.

For more than a year, I’ve been advocating a practical and permanent solution that includes four important elements.

First, Congress must reform the law governing the affected pension plans by requiring them to meet new, more rigorous and realistic actuarial standards. Pension plans should lose the special treatment that many plans receive which allows them to operate in unsustainable ways.

Second, the stakeholders must share in the costs of returning pension plans to a firm footing. Retirees must accept modestly reduced benefits during the time period required to get the plan back on an actuarily sound foundation. Once the difficulty has passed, retirement benefits can return to levels that reasonable and responsible actuarial standards permit.

Third, for pension plans that make the needed and required reforms and demonstrate that they are serious about actuarial soundness, Congress should authorize short-term loan guarantees. This will allow the pension plans to get through their short-term cash crunch. Without going into all the details, pension plans have a current cash payout problem.

But over time, with these loans, they can get back on a firm financial and actuarial footing. The total cost of these loans would be roughly $25 billion — which would be repaid because only those pension plans that did what was necessary to get back on a firm financial footing would qualify for them.

So in the end, the taxpayers are not on the hook for the loan guarantees, or porkbarrel bailouts motivated by a financial crisis, or increased welfare expenditures caused by retirees losing their pensions.

Fourth, Congress must reform the Pension Benefit Guarantee Corporation (PBGC) to make it function like a real insurer where risks and costs balance out. If nothing is done, the PBGC will be bankrupt within the next six years, leaving taxpayers on the hook to make good on its promises. That would cost taxpayers hundreds of billions.

As a committed conservative, I wholeheartedly agree that markets work efficiently and that government almost never does. Many of the problems currently observed with pension plans are the result of poorly conceived government laws and regulations.

We must fix this before the problem grows and becomes catastrophic. But failing to act plays into the hands of those that will never let “a crisis go to waste.”

George Landrith is the President of Frontiers of Freedom an educational foundation whose mission is to promote a strong national defense and peace through strength.


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Old 10-09-2018, 06:45 AM
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BAILOUT

http://www.pensionrights.org/newsroo...-pension-plans

Quote:
Comments to the Joint Select Committee on Solvency of Multiemployer Pension Plans | Pension Rights Center

Spoiler:
On September 30th, 2018, the Pension Rights Center submitted comments to the Joint Select Committee on Solvency of Multiemployer Pension Plans.The letter includes three sections:
1) An explanation of how this emerging crisis developed and a critique of MPRA, which reversed the key promise of ERISA: that a plan cannot take away benefits that employees and retirees have already earned.
2) A description of the principles that should guide this Committee in developing its proposed legislation, including the repeal of the Multiemployer Pension Reform Act of 2014 (MPRA) and restoration of benefits already cut under that misguided statute.
3) The reasons that the so-called “composite” legislation cannot be a part of a solution.
Read the comments, here.

http://www.pensionrights.org/sites/d...0-2018_rff.pdf
Quote:
Dear Chairman Hatch and Chairman Brown:
The Pension Rights Center is pleased to submit comments to the Joint Select Committee on
Solvency of Multiemployer Plans as the Committee works to find a bipartisan legislative solution
to the insolvency crisis facing the multiemployer plan system. The Pension Rights Center is a
national consumer organization that works to protect the retirement income security of workers,
retirees and their families
Spoiler:
Ensuring that retirees and employees receive the pension benefits they earned and were promised
is fundamental to the American dream. Hard-working patriotic Americans—retired mine
workers, truck drivers, warehouse workers, iron workers, including many veterans who fought to
preserve democracy around the world—gave up wages, vacation pay, and other workplace
benefits in exchange for the promise of a guaranteed pension at retirement. It should be noted
that this was the promise that Congress made to them when it enacted the Employee Retirement
Income Security Act (ERISA) in 1974.
These workers and retirees have been counting on this income to fund their retirement years and
to avoid poverty in old age. If their promised pensions are cut, it will not only upend the lives of
the pensioners themselves, but wreak havoc on their spouses, children, grandchildren and other
family members. Pension cuts will also harm local economies where pensioners buy groceries,
frequent restaurants and keep local businesses thriving. Moreover, a recent economic study
suggests that the failure of the Central States plan alone could cost the nation tens of thousands
of jobs, negatively impact GNP, and reduce federal and state and local tax revenue by billions of
dollars.1

For the past four years, the Pension Rights Center has been working with thousands of retirees
who are increasingly perplexed and angry that their benefits have been put on the chopping block
as a way of solving the multiemployer crisis. They know they delivered what their employers

1 This study (https://www.powrnow.net/wp-content/u...-AB-Report.pdf), by economist Alex
Brill, a research fellow at the American Enterprise Institute, finds that the insolvency of the Central States, Southeast
Southwest Areas Pension Fund alone would result in the loss of about 55,000 jobs nationwide by 2025, would drop
the nation’s Gross National Product by more than $5 billion, reduce state and local tax revenue by almost $450
million, and cut federal tax revenue by about $1.2 billion.
Page 2 of 5
and the country asked of them and played no role in the underfunding of these plans. Why, they
ask, are they being singled out to pay the bill covering their plan’s shortfalls?
The retirees voice the same frustrations and sense of betrayal that is more broadly reflected in
national discourse among working class people. The retirees we have heard from are not
partisan—they are Republicans, Democrats, and Independents, but they believe, with good
cause, that America has turned its back on them. How this issue is resolved, and whether these
retirees’ concerns and fears are addressed in this Committee’s proposed solution, will determine
whether they have faith in or give up on America’s promise. How this issue is ultimately
resolved will have repercussions for our nation for years to come.
This Joint Select Committee can and must develop a comprehensive solution that fairly prevents
the insolvency of a minimum of 130 severely underfunded pension plans, protects the earned
benefits of 1.5 million retirees and workers, helps keep thousands of contributing employers in
business, and restores the promise of ERISA. The Committee must also act to put the Pension
Benefit Guaranty Corporation, which projects the likely collapse of its multiemployer plan
insurance program by 2025, on a sound footing for the foreseeable future.
This letter will include three sections:
1) An explanation of how this emerging crisis developed and a critique of MPRA, which
reversed the key promise of ERISA: that a plan cannot take away benefits that employees
and retirees have already earned.
2) A description of the principles that should guide this Committee in developing its
proposed legislation, including the repeal of the Multiemployer Pension Reform Act of
2014 (MPRA) and restoration of benefits already cut under that misguided statute.
3) The reasons that the so-called “composite” legislation cannot be a part of a solution.
I. How did we get here?
There are more than 10 million workers and retirees in 1,400 multiemployer pension plans—
plans negotiated with more than one employer. Most of these plans are adequately funded, but
about 130 plans, including several very large plans, are projected to run out of money within the
next 10- 20 years.
There are a variety of reasons why certain multiemployer plans have serious funding shortfalls.
First, the plans suffered substantial investment losses because of the severe market declines in
2001 and 2008. Also, economic changes have caused a decline in some of the industries that
support multiemployer plans, with the result that some plans now find themselves with more
retirees than active workers. This, together with company bankruptcies and numerous employers
withdrawing from plans, has caused a significant decrease in contributions to the plans.
Congress, in an ill-advised attempt to address the funding problem, enacted MPRA in 2014,
which empowered employer and union trustees of certain severely underfunded multiemployer
plans to reduce already accrued retirement benefits—as much as 70%.
Congress passed MPRA without hearings or debate; the provisions of MPRA were simply
attached by House leadership to must-pass spending legislation shortly before Congress
Page 3 of 5
adjourned in December of 2014. MPRA eviscerated 40 years of protections under the federal
private pension law, ERISA, which prohibited plan trustees from reducing benefits in pay status
until the plan had exhausted its assets.
Since this law passed, almost two dozen multiemployer plans have applied to the Treasury
Department for approval to cut their workers and retirees’ benefits. Treasury has approved seven
applications, rejected five, and is currently considering at least ten others. Thousands of retirees,
who earned benefits that gave them a secure future, as well as their spouses, and the widows of
deceased retirees, are now experiencing the devastating ramifications of what they see as
“pension theft.”
What is shocking to these retirees is that even as the Joint Select Committee is contemplating
new solutions, there is talk among some stakeholders of keeping MPRA’s cut-back provisions as
an alternative or parallel solution. A fair and just solution requires that MPRA be repealed and
replaced, not retained and augmented.
II. Elements of a Fair Multiemployer Solution
We understand that there will be give and take in crafting a multiemployer solution. We strongly
urge the Committee to incorporate into any compromise approach the following core principles:
First, recognizing the importance of multiemployer plans to their participants, to their
contributing employers, to their communities and to the nation, legislation should result in the
financial stabilization of such plans so that a robust multiemployer system will continue into the
future.
Second, the majority of multiemployer plans are financially sound and legislation should
not harm those plans.
Third, the financial cost of repairing the multiemployer system should not be borne
primarily by retired participants in these plans, as has occurred under MPRA. This legislation
must be repealed and replaced with a workable solution that balances the interests of all
stakeholders and protects the earned benefits of workers and retirees.
Fourth, federal financial assistance is appropriate given that the economic and human
costs of not fixing the system vastly exceed the costs of fixing it.
Fifth, the Pension Benefit Guaranty Corporation’s multiemployer program must be
improved and put on a sound fiscal basis.
Sixth, shoring up the ability of currently financially-troubled plans to meet their benefit
obligations should be the Committee’s sole concern rather than authorizing new types of plans
for adequately funded plans that would sap financial resources from existing plans.

The following elements of a legislative proposal would fulfill these principles:
Page 4 of 5
1. Creation of a federal loan program that eases the cash-flow problems of financiallytroubled
multiemployer plans. Such a program should earmark loans to fund existing retiree
and deferred vested benefits, leaving the plans with the time, resources and tools to grow out of
their financial problems through the existing contribution base and investment earnings. These
loans should be available to all plans that are in critical and declining status as long as the plans
can demonstrate that they will be able to repay the loans and satisfy their benefit obligations to
active workers. As important, all plans that have cut benefits since the enactment of MPRA
should be eligible to apply for loans so that they are able to restore workers’ and retirees’
benefits to their previous levels.
2. Plans should not be permitted to cut retirees’ earned benefits. MPRA has been used
by plans to obtain financial stability at the expense of their older, vulnerable members by
disproportionately focusing the largest benefit cuts on those who have already retired. This is
inconsistent with a century of pension practice and law, which has always provided the strongest
benefit security to those who have already retired and are no longer in a position to make up
losses if their pensions are cut. Any legislation should repeal the cut-back provisions of MPRA.
3. The PBGC should be provided with sufficient resources to ensure that it can meet its
current and future obligations to insolvent plans and also provide financial assistance to
enable troubled plans to remain solvent. In addition, resources should be provided to increase
currently inadequate guarantee levels.
4. Legislation that provides for loans and/or PBGC assistance to ongoing plans should
have guardrails to prevent abuse and ensure that the loans are repaid.
We also believe that the voices of retirees and workers must be heard at all stages in the
development and vetting of the Committee’s proposals.
III. Composite plans are not the right solution
Lastly, composite plan legislation should not be part of the committee’s deliberations on fixes
for the multiemployer crisis. Composite plans, as envisioned, are poorly designed, could lead to
the underfunding of today’s adequately funded plans, would further endanger the PBGC’s
financial status, and would undercut the security of the entire multiemployer system.
In conclusion, we thank you for all of your hard work on this critically important issue and urge
you to develop a comprehensive solution that fixes severely underfunded plans, protects the
pensions of workers and retirees and puts the PBGC on sound footing. We will be happy to
provide you and the other Joint Select Committee members with additional information.
https://burypensions.wordpress.com/2...out-committee/

Quote:
What the PRC did not address:

1. Where will the loan money be coming from?
2. How can a multiemployer plan that demonstrates an inability to pay benefits to their retirees without loan money also prove that it will have the resources to repay those loans?
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Old 10-09-2018, 06:47 AM
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BENEFIT CUTS

http://www.pionline.com/article/2018...cuts-finalized
Quote:
Western States multiemployer pension benefit cuts finalized - Pensions & Investments

Spoiler:
Western States Office and Professional Employees Pension Fund, Portland, Ore., received final approval from the Treasury Department to cut benefits as of Oct. 1 for participants and retirees as part of a rescue plan.
It was the pension fund's third attempt; two previous applications were withdrawn.
Of the 7,331 eligible participants and beneficiaries, 2,326 voted to reject the benefit cut and 920 voted to approve it. But 3,986 members did not return a ballot and since a majority of eligible voters did not reject it, the benefit reduction goes into effect. Fund officials must make an annual determination that the benefit reductions need to stay in effect to avoid insolvency.
The fund had $336 million in assets and $525 million in liabilities as of Jan. 1, for a funded status of 64%. Without the benefit reductions, known as suspensions, the plan was projected to be insolvent by 2036.
Retirees older than 80 or under disability will see no change in benefits. Active participants, terminated vested participants and retirees under the age of 80 will see 30% reductions.
In materials to participants, trustees said retirees now outnumber active workers 11 to 1, and the number of employers dropped to 168 currently from 280 in 2008. Investment returns stabilized in recent years but were not enough to make up for losing 32% in 2008, plus the decline in contributions, the trustees said.

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Old 10-12-2018, 11:51 AM
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BAILOUT

http://hpr1.com/index.php/feature/ne...pension-heist/

Quote:
THE GREAT AMERICAN PENSION HEIST
Spoiler:
FARGO – Bob Berg wore the Pullman-brown jacket and drove a matching-colored UPS truck throughout North Dakota until he retired, faithfully deducting his salary every month to fund his pension.

Now, he’s getting far less than he saved for and was promised. His pension has taken a $700 monthly hit, and insurance rates have risen by $400 each month.

Dennis Kooren also wore the same iconic jacket for 30 years, retiring in 2007. Until three years ago, his pension came in full, and then the government wanted to begin deducting 50 percent. He didn’t accept the deduction, and began fighting back. His has been a lonely battle until recently. The media isn’t reflecting the seriousness of the situation. Legislators ignored him.

Local Vietnam veterans, truck drivers, glass glaziers, grocery store employees, and union members – all Baby Boomers – were gathered during a scheduled meeting of the Fargo Committee to Protect Senior Rights at Marlin’s Family Restaurant. A representative of U.S. Congressman Kevin Cramer’s, Lisa Givens, sat on one side of the room, while another representative of U.S. Senator Heidi Heitkamp’s, Justin Hanson, sat on the other side.

A young face in the crowd stood out as she rose to speak. Callie DeTar’s father Bill Burns died last year at 65 years old due to the stress of fighting for his pension as a retired glazer from Fargo Glass & Paint. The worries of losing his pension gave him anxiety that his body eventually succumbed to, DeTar said.

Save our pensions - photograph by C.S. Hagen

“He would often say he should just give up because he won’t have a penny to his name after the pension fails,” DeTar said. “His heart ended up giving out. He had a lot of health issues but his death was due to his heart stopping and the hospital was unable to get it started again.”

Berg, Kooren, DeTar’s father, approximately 2,000 others in North Dakota and millions across the nation are now being treated as second-class citizens. Promises made by the federal government are being taken away. Their votes don’t seem to count, and they have become targets of hate. Their insurance is being taken away. Their very survival at the end of their lives is at risk.

Kooren, the unofficial leader of the Fargo Committee to Protect Senior Rights is fighting to protect what was once-guaranteed pensions. Berg, who has organized dozens of fundraisers including a 2004 truck drive that tripled the Guinness Book of World Records mark, is fighting along Kooren’s side. DeTar, 33, is new to the group, and recently traveled to Washington, D.C. speaking to senators about their concerns.

Her pleas for help were met mostly with dumbfounded stares and little to no concern. A vague letter from President Donald Trump thanking her for sharing her father’s story, promising to put “Americans First” isn’t helping either.

Concerned citizens fighting for their pensions pledge allegiance to the flag that represents the government trying to take away the livelihood - photograph by C.S. Hagen

At home in North Dakota, however, the group found an ally with Heitkamp, who reworked a draft proposal from the Teamsters and turned it into a bill presented to Congress. Current U.S. Congressman Kevin Cramer later signed on to the bill, called the Butch Lewis Act, named after a Vietnam veteran who died while defending his generation.

“These workers and retirees followed the rules and did everything right,” Heitkamp said the day she announced the Butch Lewis Act in Bismarck. “They worked for years, if not decades, in jobs that took tolls on their bodies, saving for retirement the whole way and expecting those savings to be there for them. Now, through no fault of their own, the rug will be pulled out from under them.

“If Congress doesn’t act, the impacts on workers and families will be devastating. As a country, we must work and keep our promises to workers and retirees. That’s what our bill would do… Now Congress needs to pass our bill and avoid needlessly putting workers and retirees across the country in jeopardy. I refuse to allow that to happen on my watch.”

The Butch Lewis Act and its House companion bill, the Rehabilitation of Multiemployer Pensions Act, would issue bonds in order to loan money to ensure retirees are guaranteed promised benefits.

For once agreeing with Heitkamp, Cramer, who is now in final laps of a heated race for Heitkamp’s Senate seat, was the second Republican to sign on to the bill, saying the proposal is the only bill that takes a serious approach to solving the pension crisis.

“If we do not tackle this problem soon through a legislative solution, it will be more costly for the federal government down the road,” Cramer said in a press release. “It will also jeopardize the benefits of more retirees who paid into these pension programs over a lifetime of hard work.”

“This is a fight for the end of our lives at the end of our lives,” Kooren said. “This is a push in a sense saying that ‘Let’s get this thing fixed.’ The Butch Lewis Act is the only one out there that does not take away our pensions. It’s either pay more or pay later, and the Butch Lewis Act is the most efficient thing out there.”

Pension history
The once ironclad pension fund for government employees with lackluster jobs, truck drivers, soldiers, UPS delivery men and women, Fargo Glass & Works, and many other businesses around the nation is nearly bankrupt. Underfunded by $4.4 trillion – equivalent to the total economy of Germany – the lack of funds threatens to trigger another global economic meltdown and leave thousands in North Dakota, millions across America and the world, without an income in their last days.

Callie Detar speaking before the group of concerned citizens fighting to keep their pensions - photograph by C.S. HagenThe pension industry is complex, globally interconnected. The worldwide net effect is much larger with a $78 trillion shortfall in pension obligations.

The first corporate pension plan in the United States was established by the American Express Company in 1875. Banking and railroad companies including Standard Oil, US Steel, AT&T, Goodyear, and General Electric, followed suit, and by 1921 the Internal Revenue Act helped spur growth by exempting contributions made to employee pension funds from federal corporate income tax.

By 1950, approximately 10 million Americans had a pension, and ten years later that percentage grew to nearly half the private sector. When the pension fund was under Teamster management, tens of millions of dollars were loaned to racketeers who invested in casinos, and yet the same era is historically noted as the safest time for the pension fund.

When some pension plans began to fail, however, the government enacted the Employee Retirement Income Security Act in 1974. Since 1982 the fund has been run by prominent Wall Street firms and monitored by a federal court and the Labor Department.

“There have been no more shadowy investments, no more loans to crime bosses,” The New York Times reported in 2004. “Yet in these expert hands, the aging fund has fallen into greater financial peril than when James R. Hoffa, who built the Teamsters into a national power, used it as a slush fund.”

All was quiet on the pension front until the economic crisis of 2007 and 2008. Monies were invested poorly and mismanaged. Banks were bailed out, but not pension policies; accounts were robbed from Peter to pay Paul.

The Central States Pension Fund, one of the nation’s largest multiemployer benefit pension plans with more than 400,000 participants, reported a number of reasons for the monumental collapse, which depleted funds from the Central States Pension Fund of more than $9.4 billion, according to the Internal Revenue Service.

Deregulation of the trucking industry in the 1980s resulted in the loss of more than 10,000 employers who donated to the fund, according to the Central States Pension Fund. Baby Boomers, who are living longer than previous generations, are now retiring in record numbers. Two major recessions since 2000 “torpedoed the U.S. economy, driving down the Fund’s investment assets and pushing many once-contributing employers into bankruptcy.”

A final reason is that since 2008 three major trucking companies went bankrupt, leaving the fund $1.7 billion short. Even though the market has rebounded, and the federally funded Pension Benefit Guaranty Corporation or PBGC is supposed to guarantee pensions and cover payments when needed, funds are still desperately lacking.

Attempts to resolve the downward spiral came in 2004 when the Central States Pension Fund eliminated early retirement with full benefits, and then in 2010 when the Fund supported the “Create Jobs and Save Benefits Act,” which failed.

Congress had no interest in the bill.

“With more than 100 pension plans covering 1.3 million people projected to fail in the next 20 years, the PBGC is also expected to run out of money,” The Central States Pension Fund reported on its website. “In fact, it is projected that the PBGC’s multiemployer program will run out of money in 2025. If that happens, pension benefits would be reduced to essentially zero – no Central States Pension Fund participant would get any meaningful pension because Central States and the PBGC will both be out of money.”

North Dakota’s pensions are currently 63.1 percent funded with per capita income of $55,802, according to the Wall Street Journal, which makes the state fourth in the nation for pension security. But more than 100 municipalities have filed for bankruptcy and an equal number of cities were placed under emergency manager control within the past 12 years in the United States, according to Bloomberg, which when combined will effect funds in all states.

In a December 6, 2017 testimony to the Special Committee on Aging U.S. Senate, Laurie McCann, a senior attorney with AARP Foundation, said that the fight for the elderly is a two-edged sword. Along one edge, reports of companies trying to nudge elderly workers from the workforce have increased, while along the opposing edge retirees no longer have guaranteed lifetime incomes.

Those over ages 65 to 74 work out of necessity, three of ten families do not have any type of retirement savings, and seven out of 10 families have less than a year’s worth of finances saved, Kathy Schwan, of AARP, said.

In 1990, only 12 percent of the workforce was 55 or older, while in 2016 workers 55 and older comprised 22 percent of the workforce and that percentage is increasing.

The threat is also real for three other retired UPS workers in the New York Teamsters, whose benefits were cut by 29 percent. They’ve gathered 21,000 others and sued the federal government in August this year stating that Congress, by acting the Multiemployer Pension Reform Act of 2014 violated the Takings Clause of the Fifth Amendment that states “private property [shall not] be taken for public use, without just compensation.”

The plaintiffs plan to argue that cuts to pension plans benefited the federal government by eliminating or reducing the coverage risk of the government’s insurance plan.

Tribalism
The nonprofit and nonpartisan organization AARP and its 38 million members is the nation’s largest organization that works to empower Americans 50 and older. The group’s members also represent a formidable voting force, and although AARP does not endorse candidates, they do rally behind what they consider good legislation.

Schwan encouraged people gathered during last week’s meeting to vote for candidates who back the Affordable Care Act and Medicaid Expansion. AARP is also an advocate of the Butch Lewis Act, she said.

Dennis Kooren, who has been fighting for keeping pensions and changing laws for more than three years, talks before concerned citizens - photograph by C.S. Hagen

“Things look pretty bleak, and if you think of things like Medicaid Expansion has no influence on you, think again,” Schwan said.

“Are you able to kick Hoeven [Senator John Hoeven] in the ass and say get on board?” a person attending the meeting said. “It’s the people of North Dakota he’s supposed to work for.”

“I’m going to add this one to the list,” Schwan said. “We really need to get John on board. He’s a reasonable guy but some of these issues are really partisan.”

“He should have a mind of his own,” another person said.

“I just really don’t understand what’s going on with him on this issue,” a third person said.

“There’s a lot of tribalism going on, there really is,” Schwan said.

Baby Boomers
The Fargo Committee to Protect Senior Rights have received cold shoulders from many of senators at the national level.

“Republicans are not helping, they’re not showing up for meetings,” Callie DeTar said.

Kathy Schwan of AARP discussing tactics - photograph by C.S. Hagen“Congress has known about this and they have failed to do anything about it,” Dennis Kooren said. “They did not do their job, and because Congress did not do their job both Democrats and Republicans are trying to stick us with it.”

Opponents of the Butch Lewis Act say they’re against the bill because they believe it would be another bailout.

“It’s not a bailout,” Bob Berg said. “That money should have paid back our pension fund as far as I am concerned. We don’t have much time left before the end of November. If they don’t come up with a decision by the end of November, it will be insolvent in four years and none of us will have a penny.”

The Butch Lewis Act could cost anywhere from nearly a trillion dollars to $34 billion, but either retirees will be forced to survive on Medicaid Expansion or the protections within the Butch Lewis Act, either way, funds will come from taxpayers, Kooren said.

“Let our country know that we did everything we were supposed to do, they promised a retirement after we were done working, and it’s not the companies’ fault… it’s the government’s,” Berg said. “The government should be held accountable for what is happening to us.”

America’s far right or the so-called “Alt-right” wants to eliminate unions and to some degree the State Department, Berg and Kooren said. Berg has had politicians laugh to his face after describing how unions, a vital force for today’s paid vacations, sick leave, minimum wages, child labor laws, overtime pay, pensions, worker’s compensation, health insurance, parental leave, among other issues, are suffering.

As a Baby Boomer, Kooren, Berg and DeTar are fighting for what they and their parents were promised. Their generation may be considered by some as the flawed inheritors of World War II’s GI Generation with the sexual revolution, the Vietnam War, and illegal intoxicants. But they also tore down the Berlin Wall, brought the civil rights and women’s liberation movements, gave the world Woodstock, GPS, and computers.

Now that boomers are at retirement age and are the major if not slowly disappearing force in current American politics, their contributions should not be forgotten, Kooren said.

Political satirist and author of “The Baby Boom: How It Got That Way (And It Wasn’t My Fault)(And I’ll Never Do It Again),” P.J. O’Rourke summed up the differences best in an article he wrote for AARP Magazine.

“Will Generation X and the Millennials do a better job running the world than the boomers have? Let’s hope so. But first they’ll have to move out of our basements.”


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Old 10-12-2018, 02:31 PM
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BAILOUT

https://www.plansponsor.com/red-zone...never-recover/

Quote:
‘Red Zone’ Multiemployer Pension Plans May Never Recover
But with Congressional assistance, there is hope for these plans, Segal Consulting says.
Spoiler:
The subset of “red zone” multiemployer pension plans that are in critical and declining (C&D) status projected to be insolvent within the next 20 years may never recover without Congressional help, Segal Consulting maintains. Participants in these plans are at risk of reduced benefits, including current retirees.

There has been a double-digit decrease in the average market value funded percentage of plans in C&D status since 2010, compared to a double-digit increase for non-C&D plans.

Characteristics of C&D plans include a high retiree and inactive-to-active ratio and a high “burn rate,” i.e. the rate of asset decline, without regard to investment income.

Over the last 10 years, most red zone plans have taken corrective actions. They have increased their average contribution rate by more than 50% and have reduced adjustable benefits for more than 80% of participants. Some red zone plans are now in the yellow or green zone. By comparison, C&D plans are not recovering.

Segal Consulting notes that the Congressional Joint Select Committee for the Solvency of Multiemployer Pension Plans is currently weighing options for strengthening these plans.

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