Breaking News: Automotive Industries Pension Fund Gets MPRA Letter

On September 27, 2016 trustees of the Automotive Industries Pension Fund out of Alameda, CA became the tenth multiemployer (union) plan (and with 25,834 participants the third largest) to file for benefit cuts under MPRA in an attempt to avoid insolvency.  In a letter dated yesterday they got their response:

Denied.

From their latest 5500 form here is the plan’s relevant data:

Plan Name: Automotive Industries Pension Fund
EIN/PN: 94-1133245/001
Total participants @ 12/31/15: 25,834 including:
Retirees: 11,195
Separated but entitled to benefits: 10,719
Still working: 3,920

Asset Value (Market) @ 1/1/15: 1,302,787,847
Value of liabilities using RPA rate (3.51%) @ 1/1/15: $3,133,469,524 including:
Retirees: $1,691,351,507
Separated but entitled to benefits: $1,026,865,805
Still working: $415,252,212

Funded ratio: 41.58%
Unfunded Liabilities as of 1/1/15: $1,830,681,677

Asset Value (Market) as of 12/31/15: $1,218,051,896
Contributions: $26,949,498
Payouts: $133,827,365
Expenses: $7,862,528

10 responses to this post.

  1. Posted by dentss dunnigan on May 11, 2017 at 7:47 am

    Connecticut State Capital Prepares For Bankruptcy Amid Collapse In Hedge Fund Revenue….The state of Connecticut has been hit hard by the double whammy of a deteriorating local economy, coupled with a plunge in hedge fund profits – as well as hedge fund managers permanently relocating to Florida – leading to a collapse in tax revenues. …..A preview of things to come ….http://www.zerohedge.com/news/2017-05-10/connecticut-state-capital-prepares-bankruptcy-amid-collapse-hedge-fund-revenue

    Reply

  2. Posted by George on May 11, 2017 at 9:31 am

    Oddly, no national outcry over California auto mechanics retiree health benefits.

    Reply

  3. Posted by MJ on May 11, 2017 at 10:59 am

    Is it me or is there a common denominator to all of these pension articles and public financial issues………no more money to pay over promised, overly generous benefits for decades…….too many taking to much for doing too little

    Reply

    • Posted by Anonymous on May 11, 2017 at 11:29 am

      Exactly, and the “lack of “full funding” is not the CAUSE of the pension mess, but the CONSEQUENCE of the real root cause …. grossly excessive pension/benefit “generosity”.

      Reply

  4. Posted by Anonymous on May 11, 2017 at 8:40 pm

    http://amp.nj.com/v1/articles/20653597/christie_administration_details_plan_to_slash_publ.amp

    John,

    Based on previous posts regarding how employer (State) contributions are allocated does 78% TPAF, 21% PERS, and 1% P&FRS sound accurate? What about SPRS and especially JRS which you’ve noted is expected to run dry first?

    Probably the State could/would reallocate non lottery fund contributions to the various pension funds as needed? Of course, this assumes voter approval and adequate funding source(s) of existing lottery fund appropriations.

    Reply

  5. Posted by Anonymous on May 12, 2017 at 10:03 am

    Anonymous on May 11, 2017 at 8:40 pm
    http://amp.nj.com/v1/articles/20653597/christie_administration_details_plan_to_slash_publ.amp

    John,

    Based on previous posts regarding how employer (State) contributions are allocated does 78% TPAF, 21% PERS, and 1% P&FRS sound accurate? What about SPRS and especially JRS which you’ve noted is expected to run dry first?

    Probably the State could/would reallocate non lottery fund contributions to the various pension funds as needed? Of course, this assumes voter approval and adequate funding source(s) of existing lottery fund appropriations

    Reply

    • Like the quarterly contribution thing this is a non-story. I get that they want to inflate the pension fund asset value so as to reduce contributions but they already have that power – they either tell the actuaries what number to come up with or, after they get the number, they apply an arbitrary fraction to the amount.

      Reply

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