By David Brandolph
The Butch Lewis Emergency Pension Plan Relief Act of 2021 (BLA) continues to provide an important lifeline to financially challenged multiemployer pension plans, and in turn, has already brought monetary and mental stress relief to hundreds of thousands of retiree-plan-members, their spouses, families and their communities.
As of October 27, the Pension Benefit Guaranty Corporation, the federal agency tasked under the statute to administer and distribute special financial assistance (SFA) funds to eligible plans, had approved about $53.5 billion in SFA to 42 plans that cover over 771,000 workers, retirees, and beneficiaries. The agency’s latest projection report estimated that 211 plans would ultimately be approved for SFA to the tune of about $79.7 billion.
Congress anticipated that funding under the BLA, which was enacted as part of the American Rescue Plan Act of 2021, would keep recipient plans afloat for at least 30 years. As a result of the Act, PBGC projects that its multiemployer insurance program, which backstops plans, is likely to remain solvent for more than 40 years. That’s an incredible accomplishment given that, before the BLA became law, PBGC projected that the multiemployer program would be insolvent by Fiscal Year 2026.
Revving up its review process, PBGC has approved new SFA applications for 24 plans in the last six months, including its June 29 thumbs up for two larger plans–the 64,522-member PACE Industry Union-Management Pension Fund, headquartered in Nashville; and the 48,254-member National Integrated Group Pension Plan, in Scranton, PA.
When PBGC in early May approved SFA for the 7,230-member Office and Professional Employees International Union Western States Pension Plan, headquartered in Portland, OR, Cathy Green, of Lake Stevens, WA., was among the plan’s members happy to get the good news:
“I was devastated when I and thousands of other retirees had our benefits cut by 30 percent under the Multiemployer Pension Reform Act of 2014 (MPRA). However, because of the passage of the Butch Lewis Act, our full benefits were restored and I now have financial security for my basic needs. I thank PRC and members of Congress, including my Senator, Patty Murray (D-WA),” Green told PRC.
Of the 18 plans that cut the benefits of their members under MPRA, PBGC has approved SFA aid for 17 of them, covering 131,361 workers and participants.
The Central States Pension fund, which was approved for aid in December, received in January about $35 billion in SFA that it can now use to pay benefits to its 357,000 members.
The status of all SFA applications can be found here.