Road Carriers 707 Pension Update
Road Carriers 707 Pension Fund Update
This email was sent by the Road Carriers 707 Fund office to keep you informed of any updates to the 707 Pension Fund
Road Carriers 707 Pension Fund
Pension Reform Legislation Update September 27, 2019
In July the House of Representatives passed the Butch Lewis Bill which relies on the creation of a loan program to assist Multiemployer pension funds such as ours. This was done with the support of all House Democrats and bipartisan support of 29 Republicans including the chief Republican sponsor Peter King and New York Republicans Lee Zeldin, John Katko and Chris Collins. Please contact your Congressional Representative and thank them for their support if they voted Yes and express your frustration if they voted No.
The next hurdle is in the Senate where 60 of 100 votes are needed to pass this Legislation. Currently Republicans control a majority of the votes in the Senate. The Butch Lewis legislation was recently introduced in the Senate. No hearings or votes are scheduled. The strong bipartisan support in the House of Representatives shows broad based support for multiemployer pension relief. But it became clear during the debate in the House and subsequent discussions Republicans are not in support of a loan program such as the Butch Lewis Bill and a compromise in the Senate must be reached.
In my many visits to Washington, DC, discussions with the Union’s lobbyist and stakeholders in the multiemployer pension world, several distinctions between a proposed Senate bill and the Butch Lewis Bill (HR 397) are clear. Although there is no compromise bill filed in the Senate there has been significant bipartisan discussions. Below are some of the different scenarios and priorities of any Legislation being discussed:
Instead of a loan program detailed in Butch Lewis for troubled plans discussions are centered around partitioning orphan and other liability enough for plans to avoid or come out of insolvency.
The Pension Benefit Guarantee Corporation (PBGC) would administer the partitioning and would require additional funding to provide the resources necessary. Discussions also include an increase in the PBGC minimum guarantee.
Any Legislation must minimize hits to retirees and employers who voluntarily joined these multi-employer plans. Any relief cannot adversely affect healthy plans and there must be changes in existing rules to allow healthy plans to stay that way.
Any Legislation will not be a stand-alone bill requiring a stand-alone vote. Most probably will be attached to one of the required bills to keep the government funded prior to the end of the year.
The Republican Chairman of the Senate Finance Committee, Senator Chuck Grassley of Iowa is taking the lead on creating an outline of what possible Legislation may look like. It is expected within the next several weeks. This document will be circulated to stakeholders in the multi-employer pension world to provide feedback. Several things are clear, the longer it takes for relief the costlier it is to fix it. The Central States Pension Fund is expected to become insolvent in 2025. This insolvency will bankrupt the PBGC and cause a loss of Government Tax revenue of over 3 billion dollars plus the increased cost of social services. With these costs factored in the cost of any pension relief is reduced significantly.
We cannot thank enough Congressman Peter King as the Chief Republican Sponsor of HR-397 who provided the bipartisan support, this momentum is now carrying over into the Senate. And as always, we must recognize and thank Senate Minority Leader Chuck Schumer who continues to look out for Local 707 retirees, actives and participants. At every step of the way, Local 707 is included in any discussions of Pension relief. This would not be happening if Senator Schumer did not make our issue his priority.
Please remember to thank your Congressional representative if he voted for the Butch Lewis Bill and feel free to let them know how you feel if they didn’t.
As soon as more details are released, I will send out more updates.
Kevin McCaffrey, President
Teamsters Local 707
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