teamsters local 707 websute has been out of date for years
ignorance is bliss and keeps the mind shsrp?
Teamsters get a reprieve from pension cuts
Cuts would occur in October rather than July after federal agency rejects initial plan
Updated 10:05 pm, Monday, April 17, 2017
Albany
Thousands of upstate retired Teamsters have dodged a potential pension cut — at least for now — thanks to a recent decision by the federal government.
And the retirees may face smaller cuts than the original plan's call for a reduction in benefits of almost a third.
Still, the respite could be short-lived as the timetable for possible cuts has been pushed from July 1 to Oct. 1.
"We need to file another application to the Treasury Department," said Tom Baum, volunteer retiree representative for the Teamsters' Local 294.
Also known as the Upstate Teamsters, Local 294 represents about 16,500 retirees and another 18,500 who are currently employed.
Many are or were truck drivers or other employees of UPS, as well as drivers who worked for car haulers transporting new vehicles from train depots to auto dealerships across the region. Most are in upstate New York, though a few reside in New Jersey.
Like a number of private sector unions, the Teamsters over the years have seen their membership dwindle due in part to federal deregulation of the trucking industry.
With fewer members to support retirees, the pension fund hit rocky financial waters following the 2008 economic crash. Fund administrators say if cuts aren't made, the system could become insolvent by 2025.
Any cuts, though, must be approved by the federal Treasury Department. Earlier in April, the agency sent back the Upstate Teamster's blueprint to regain solvency.
The agency offered several suggestions, including an updating of the fund's actuarial mortality tables. Federal officials also wanted the fund operators to make a more optimistic assumption about their annual rate of return, which was pegged at 6.75 percent for the next decade.
"The Fund's investment earnings during the last few months have been better than expected, which could help make deeper cuts unnecessary," according to a website, http://nysteamstersfundretireerep.com, set up by Baum. "It's still possible, however, that the new proposed cuts will be deeper than 31 percent."
In the meantime, UPS has offered a plan of its own which would enact across-the-board cuts of 20 percent rather than the deeper cuts contemplated in the recently rejected proposal.
Under the current plan, cuts would vary based on a worker's length of service and age, as well as disabilities.
The UPS plan, though, would give no preference to disabled retirees.
It would also enact a $10 monthly employee fee. The fix would also seek low-interest loans from the government in order to shore up pension fund finances.
UPS spokesman Steve Gaut said that was just one of several options the company was exploring in efforts to help deal with the problem.
"The company is working with stakeholders to explore legislative solutions which could help minimize the impact of required restructuring of multi-employer plans facing critical funding problems," he said in a statement. "However, there is no single proposal or agreed solution to comment on at this time."
A number of other union pension plans have run into financial problems in recent years. They can seek to lower payouts, but if the Treasury Department says no, then the plans can be placed at risk of folding.
That means that many of the most endangered plans need to eventually devise a proposal for benefit cuts that the Treasury Department agrees with.
At least one Teamsters fund has already become insolvent: the New York City-based Teamsters Local 707 system.
The federal Pension Benefit Guarantee Corp. stepped in to offer assistance, but it is only paying $570 per month, which was less than half of most pensions.
The cuts were enabled by Congress in 2014 as part of that year's budget resolution to fund the federal government.
The pensions in question are "multi-employer" plans that cover employees such as union truck drivers who may have worked for a variety of employers over the years.
"A lot of retirees are very nervous about this," said Joellen Leavelle, communications and outreach director at the Pension Rights Center, a Washington, D.C.-based organization that advocates for pensioners.
Leavelle said U.S. Sen. Bernie Sanders of Vermont has proposed cutting tax loopholes to help shore up pension funds. She said that proposal is expected to be offered again in May. Its prospects are dubious with Republicans controlling the levers of power at the federal level.
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