The Who…

The Joint Committee on Multi-employer Pension Plans (the Committee) was established in early February of 2018 by our 115^th Congress. The committee was formed to address Multiemployer Pension Plans, of which our Local is one. Basically, some of the multi-employer pension plans are not funded sufficiently. The three most endangered are the Teamsters plans, United Mine Workers, and The Bakery and Confectionery Union and Industry International Pension Fund. The other entity that this committee is supposed to fix is the Pension Benefit Guarantee Corp. (PBGC, sort of the federally backed insurance company for pension plans).

The What…

The Committee has been meeting since February of 2018 and are required to come up with a plan that will “provide relief” for endangered plans and fund the PBGC to a level that will allow it to provide some level of benefits to current retirees if those plans actually become insolvent. In the early stages of the Committee’s efforts the discussion centered around loans to the endangered plans, much like what was done for the auto industry, the airline industry, and the steel industry, (all of those loans were repaid, I might add) in not too distant history. Today however MANY of the congressional Republicans are against providing loans (of taxpayer money) to these distressed plans, but would rather cause the PBGC to be better funded by the healthy plans that are out there today.

 The most recent plan to be discussed would cause all plans to use a new assumption rate (the rate that plans use to determine return on investment) of federal bonds plus a standing percentage of 2 or 3. If this plan where enacted today, the assumption rate would be 6-6.5%. This knee jerk change to the assumption rate would likely push a great number of currently healthy plans into an endangered status. Additionally, individual plans would pay more of a premium to the PBGC, from $26.00 per plan participant (currently) to a variable fee, based upon funding levels, from $50 - $150 per participant (for those paying attention, that is an increase of approximately 100% - 600%). An additional fee of $2.00 per participant would be paid by the Local Union’s general fund. Most troubling is the tax on benefits. If the plan, as relayed to me, goes into effect, it would cause retirees to pay a tax of up to 6% on their benefit to the PBGC--the more endangered the plan, the higher the tax. So, for instance, a plan that was not endangered, the participants would not pay an additional “tax” to the PBGC, but a plan that was critical, its retirees would pay up to 6% (this is on top of any other taxes paid). Now, I want you to remember what I said earlier, if this plan is enacted and the assumption rate is changed, it will likely push more plans into the endangered status, thus causing more people to pay more “taxes.” How many more plans would be pushed into the endangered status? Not sure, but our actuaries say that most plans would be downgraded by at least one step. Currently, according to an article written by Hazel Bradford of Pensions and Investments, there are 100 or so pensions in danger of insolvency, and about 1200 that are perfectly fine. We here at IBEW Local 26 are currently in the fine boat.

The When…

On Wednesday Nov. 28th, at 8 a.m., trustees of IBEW Local 26 pension plan and concerned parties, along with trustee’s and leadership from locals all across this country, will be meeting at the Hyatt in DC to be briefed on the situation by the International President Lonnie Stephenson and International Secretary Kenneth Cooper. We will then be heading up to the Hill to meet with congressional leaders and legislators to express our concern that this plan shifts the burden of fixing the PBGC’s funding almost ENTIRELY to the backs of UNION-negotiated pension plans, taxes the retiree’s who depend on those plans, endangers the healthy plans, and takes money from the unions own general funds. Remember, this is during the same congress that had no problem providing a 1 trillion+ dollar tax cut for the top 1% in this country. This is largely the same congress that provided bailouts to the banks and the auto industry not too long ago.

The Why…

Why? I may be wrong, but I believe that the Republicans on the committee view this as an opportunity to hurt unions. The vast majority of the multi-employer plans in existence, are sufficiently funded. We here at Local 26 just did the hard work of negotiating and approving a contract that will see our pension funded at 100% or more in 10-15 years, 20 years if the stock market isn’t cooperative. Any plan that relies on the stock market can be pushed into an endangered status with a bad year, think 2008, but historically the stock market returns and the fund is fine again. This plan, as presented, will create havoc for healthy plans, shift the burden of financing PBGC to the plans, strip funds from the coffers of local unions, place an addition tax on retirees of plans that enter an endangered status, and push healthy plans into an endangered status.

The How…

How can you help, use your voice and your means of communication? Call the legislators on the committee and let them know to keep there hands out of your pension. Tell them they can call back some of the 1 trillion+ dollars in tax breaks for the 1% and fix this problem in short and long term. That they as congress people have the power to work for the people instead of the corporations. Use the names and numbers provided below to let them know that you are watching and that this is important to you.

Members of the Joint Committee on Multi-employer Pension Plans

The phone numbers for the Senate and House Members on the committee are listed below. These number should bring you directly to the staff of the individual Senator or Representative. If not, the US Senate switchboard is (202) 224-3121 and the House of Representatives switchboard is the same.

Senator:

Orin Hatch Tel: (202) 224-5251  www.hatch.senate.gov                  

Sherrod Brown: (202) 224-2315   www.brown,house.gov

Lamar Alexander: (202) 224-4944      www.alexander.senate.gov                    

Joe Manchin: (202) 224-3954   https://www.manchin.senate.gov

Mike Crapo: (202) 224-6142     https://www.crapo.senate.gov             

Heidi Heitkamp: (202)224-2043   https://heitkamp.senate.gov

Rob Portman: (202) 224-3353   https://portman.senate.gov                               

Tina Smith: (202) 224-5641   https://www.smith.senate.gov

Legislator

Virginia Foxx: (202) 225-2071   https://foxx.house.gov                          

Richard Neal (202) 225-5601  https://neal.house.gov

Phil Roe: (202) 225-6356      https://roe.house.gov      

Bobby Scott (202) 225-8351   https://bobbyscott.house.gov

Vern Buchanan: (202) 225-5015   https://buchanan.house.gov                              

Donald Norcross: (202) 225-6501   https://norcross.house.gov

David Schweikert: (202) 225-2190   https://schweikert.house.gov                            

 Debbie Dingell: (202) 225-4071    https://debbiedingell.house.gov

To contact all the Members of the House: www.house.gov/representatives

To contact the Members of the Senate: www.senate.gov/general/contact_information/senators_cfm.cfm

Brothers and Sisters, now is the time to act. Now is the time for every union Sister and Brother to take time out of their busy schedule and contact the people on this committee and tell them that the UNION stands United and we are watching. Don’t allow the Republican machine to stab at unions one last time before the House is under Democratic control. Don’t let the Democrats forget who supports them when they support unions.

Use the numbers listed above and call, tie up their lines, go to the websites provided and send email let them know that you expect them to come up with a solution that DOESN’T endanger healthy plans, doesn’t add additional burdens to healthy plans, and most certainly doesn’t add a new tax to retiree’s.