Breaking News: Another Union Plan Approved for Benefit Cuts

The MPRA webstie popped up with another multiemployer plan resolution. This time it was the Western Pennsylvania Teamsters and Employers Pension Fund out of Pittsburgh, PA that will cut benefits.

Excerpts from their latest 5500 filing:

Plan Name: Western Pennsylvania Teamsters and Employers Pension Fund
EIN/PN: 25-6029946/001
Total participants @ 12/31/17: 22,536 including:
Retirees: 12,332
Separated but entitled to benefits: 6,015
Still working: 4,189

Asset Value (Market) @ 1/1/17: $624,594,715
Value of liabilities using RPA rate (3.05%) @ 1/1/17: $2,793,710,973 including:
Retirees: $1,755,346,643
Separated but entitled to benefits: $427,440,822
Still working: $610,923,508

Funded ratio: 22.36%
Unfunded Liabilities as of 1/1/17: $2,169,116,258

Asset Value (Market) – H as of 1/1/17: $718,421,370
Asset Value (Market) as of 12/31/17: $743,681,982
Contributions (MB): $66,777,902
Contributions (H): $59,181,940
Payouts: $134,093,979
Expenses: $8,568,051

15 responses to this post.

  1. Posted by skip3house on May 9, 2019 at 9:58 am

    Going on all over country. How can so many thousands of workers not have known for years that pensions will only be maybe 25% of promised? Guess 22% funded was not understood, and shortage of $$ Billions meant nothing?
    ‘Promise anything, so long as you sound sincere’

    Numbers/Math count….not promises!

    Reply

  2. Posted by Anonymous on May 9, 2019 at 11:24 am

    “How did you go bankrupt?” Bill asked.

    “Two ways,” Mike said. “Gradually and then suddenly.”

    Ernest Hemingway…The Sun Also Rises.

    Jane the actuary has a very good series on the MEP decline.

    https://www.forbes.com/sites/ebauer/2018/12/19/suck-it-up-buttercup-no-one-will-be-happy-with-multi-employer-pension-fixes/#33c15e925efd
    ——————–
    “How can so many thousands of workers not have known for years…” ?

    For 37 years, I watched as co-workers retired without incident. Even when I retired myself in 2009, pension problems were not on the radar. It is taken for granted. Many of us were more concerned about the future of Social Security than about the pensions.

    “Gradually and then suddenly.”

    Like you would never hear the shot that kills you… the bullet travels faster than the speed of sound. By the time the average worker finds out about the shortfall, it’s too late.

    Reply

    • Posted by stanley on May 9, 2019 at 12:19 pm

      The big tell IMO will be how the MEP pension problem is addressed. IMO it already was addressed with the Kline-Miller act of 2014 and any upgrading to that will be almost criminal and all of those buying in on it are practically insane. As painful as it might be for some, tightening the belt and living within our means is the only sensible approach to getting through this major foolishness.

      Providing for such a large group as the boomers with sound finance and economics is a huge problem. Doing it with unsound finance, falsified interest rates, crazy union slugs thinking that they only need to tell what they want and it’s the job of others to hand it over. How can it not work out badly?

      Reply

      • Posted by skip3house on May 9, 2019 at 12:45 pm

        Basic math? Finally, a picture of creation of pi 3.1415….. right here, now!
        Got that can with a perfect shape circle? Put a mark on outside edge of the lip, draw a straight line on a flat surface. This line has to be a bit longer than pi times the can’s diameter, or 2 times pi the can’s radius. Now set the rim mark on an end of the line and carefully roll it until mark goes around and hits line again. If you are perfect, the line from beginning to end where can rim mark hits will be 3.1415… times the diameter,( or 2 times its radius.)

        Reply

      • Posted by Anonymous on May 9, 2019 at 4:00 pm

        Stanley, living within one’s means is a relative statement and by now the boomers and pensioners are used to counting on a certain amount showing up in their bank accounts once a month..…..what about the economy?

        Reply

      • Posted by Anonymous on May 9, 2019 at 4:26 pm

        Elizabeth Bauer:

        “Which means that, first, rather than framing the discussion in terms of “government bailouts” what we’re really talking about is Congress making restoration payments to certain multi-employer plans to restore them to funding levels they may have had were it not for this past inappropriate legislation.”*

        *E.g.
        Plans were not permitted to intentionally overfund their plans during good years to provide a cushion for future declines but were instead obliged, if collective bargaining agreements meant they had “excess” money coming in, to “spend” that money on benefit increases.

        Plans had no means of making moderate reductions in benefits as needed over time, but could only wait until they were already in a serious crisis.

        And the minimum funding rules set forth a 30-year amortization for retroactive plan amendments rather than requiring they be “paid for” immediately.

        “unsound finance, falsified interest rates,…” True, even with Kline-Miller, and even with possible bailouts, it appears that both government and Unions are looking through rose-colored-glasses, and banking on the best case scenario.

        Reply

        • Posted by stanley on May 10, 2019 at 10:25 am

          “Plans were not permitted to intentionally overfund their plans during good years…”

          During those “good” years, the plans were typically assuming 7% return or more. If they had reduced assumed earnings, they could have accumulated more in assets. Moreover, when it became apparent long ago that benefit levels were unsustainable, they should have been reduced. Reality requires all of us to stay alert and make responsible choices and to accept responsibility for the results.

          The economy can adjust to more sensible spending patterns much better than it can a continuation of over spending. Over spending is a lot like recreational drugs or alcohol IMO. Money out of thin air is not legitimate demand. It merely shifts demand from the rightful owners.

          Reply

        • Posted by Anonymous on May 10, 2019 at 11:03 am

          Can’t remember exactly, but I think Bauer covered that. IRS wants what they want. An employer theoretically could assume a 2 percent discount rate and grossly overfund their plan. If it’s tax deferred, IRS will be watching carefully.

          Reply

  3. Posted by Tough Love on May 9, 2019 at 8:34 pm

    Off topic …………..

    https://newyork.cbslocal.com/2019/05/09/mta-overtime-scandal-larry-schwartz-empire-center-report-lirr-anthony-simon/

    FINALLY, someone willing to fight some (of the MANY MANY) MOOCHERS

    From the article:

    “A fed up Metropolitan Transportation Authority board member is making a stunning demand, urging an independent prosecutor be hired to root out overtime and pension abuse and send the violators to jail.”

    Reply

    • Posted by Anonymous on May 10, 2019 at 6:15 am

      If found guilty and sent to jail would they still receive their pensions is the big question!

      Reply

      • Posted by Anonymous on May 10, 2019 at 6:22 am

        I would also add that the woman interviewed at the end has it right….the horse is out of the barn how do you reel it in?
        In this instance I might say, the freight train is out of the station and has picked up too much speed, how do we stop it?
        As soon as a few of these bozos start being convicted of fraud or whatever it is and start to lose their pensions, the rest will quickly fall into line

        Reply

      • Posted by Anonymous on May 10, 2019 at 10:55 am

        I think pensions, even IRAs and 401(k)s are pretty well protected, even front bankuptcies, judgements, debt collection, etc. But…

        In California, at least, pensions can be lost or cut when convicted of a felony IF it is work related. Even then, though, apparently all is not lost…

        “…members, including retirees, who are convicted of a work-related felony must forfeit all service credit and contributions beginning with the date the crime was first committed through their last day worked with the employer.”

        In New Jersey, who knows?

        Reply

    • Posted by El Gaupo. on May 10, 2019 at 11:14 am

      Hmmm…..TL I thought you were willing to fight the MOOCHERS!!! You let us all down.

      Reply

      • Posted by Tough Love on May 10, 2019 at 11:32 am

        Wasn’t your 10-th prior comment …. to be your last ?

        Reply

        • Posted by Anonymous on May 10, 2019 at 1:08 pm

          Well. The windburn did go away from my ears. So….figured I’d stop in and say hello since our last back and forth. 🖐

          Reply

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