Rehabilitation For All

In their summary of the multiemployer bailout bill a consulting firm makes an interesting observation:

Some plans may find it advantageous to significantly shift their mortality, investment return, or industry level assumption in order to be in critical and declining status to be eligible for the loan program.

Here is what may happen.

Under ERISA Code Section 305 multiemployer plans which are underfunded fall into three categories:

  1. Endangered Plans have a funded percentage under 80%. They are required to adopt a Funding Improvement Plan to increase the plan’s funded percentage.
  2. Critical Plans have a funded percentage under 65%. Plans in Critical Status (“red zone”) must implement a Rehabilitation Plan which will enable the plan to emerge from Critical Status.
  3. Critical And Declining is reserved for plans which are projected to become insolvent within 15 years (or in some situations, 20 years).

Those funded percentages are based on actuarial discretion and actuaries heretofore have had every incentive to undervalue liabilities and overstate funded percentages. However, if being in Critical and Declining status would mean eligibility for free federal money, a lot of ‘best estimates’ could do an about-face.

According to the DOL website for 2018 these are the plans that are:

Critical and Declining

  1. Asbestos Workers Local 8 Retirement Trust Plan
  2. Automotive Industries Pension Plan
  3. Bakery Drivers and Salesmen Local 194 and Industry Pension Fund
  4. Bindery Industry Employers GCC IBT Pension Plan
  5. Bricklayers Local 55 Pension Plan
  6. Building Material Drivers Union Local 436 Pension Fund
  7. Carpenters Pension Trust Fund Detroit and Vicinity Pension Plan
  8. Cement Masons Local 524 Pension Plan
  9. Central States Southeast and Southwest Areas Pension Fund
  10. Chicago Newspaper Publishers Drivers Union Pension Plan
  11. Communications Workers Local 1109 Pension Plan
  12. CWA ITU Negotiated Pension Plan
  13. Employers Warehousemens Pension Trust Fund
  14. Freight Drivers Local Union 557 Pension Fund
  15. GCIU Employer Retirement Plan
  16. Graphic Arts Industry Joint Pension Trust
  17. Graphic Communications Union Local 2 C Retirement Benefit Plan
  18. IBEW Eastern States Pension Plan
  19. IBEW Local 1158 Pension Fund PA
  20. Idaho Signatory Employers Laborers Pension Plan
  21. IRC CMMIC Local 721 Pension Trust Fund
  22. Ironworkers Laborers Pension Plan of Cumberland Maryland
  23. Ironworkers Local 79 Pension Plan
  24. Ironworkers Local Union 16 Pension Fund
  25. Local 138 Pension Trust Fund
  26. Local 1482 Paint and Allied Products Manufacturers Retirement Fund
  27. Local 153 Pension Fund
  28. Local 171 Pension Plan
  29. Local 1814 Riggers Pension Fund
  30. Local 1922 Pension Fund
  31. Local 734 Pension Fund
  32. Local 734 Pension Plan
  33. Local 805 Pension and Retirement Plan
  34. Local 807 Labor Management Pension Fund
  35. Local 888 Pension Fund
  36. Local 917 Pension Fund
  37. Local 966 Pension Plan
  38. Management Labor Pension Fund Local 1730 ILA Pension Plan
  39. Mid Jersey Trucking Industry and Teamsters Local 701 Pension Fund
  40. Midwestern Teamsters Pension Plan
  41. Milk Industry Office Employees Pension Plan
  42. National Integrated Group Pension Plan
  43. New Bedford Fishermans Pension Fund
  44. New England Teamsters and Trucking Industry Pension Fund
  45. Newspaper Guild International Pension Plan
  46. Operative Plasterers and Cement Mason Local 394 Pension Fund
  47. Oregon Processors Seasonal Employees Pension Plan
  48. Paper Handlers Publishers Pension Fund
  49. Pension Trust Fund Agreement of Saint Louis Motion Picture Machine Operators
  50. Plasterers and Cement Masons Local 94 Pension Fund
  51. Plasterers Local 82 Pension Fund
  52. Pressroom Unions Pension Trust Fund
  53. Printers League GCIU Local 119B New York Pension Fund
  54. Printing Local 72 Industry Pension Plan
  55. Production Workers Pension Fund
  56. Radio Television and Recording Arts Pension Fund
  57. Retail Clerks Specialty Stores Pension Fund
  58. Retirement Benefit Plan of GCIU Detroit Newspaper Union 13N with Detroit Area Newspaper Publishers
  59. San Francisco Lithographers Pension Plan
  60. Southwest Ohio Regional Council of Carpenters Pension Plan
  61. Southwester Pennsylvania and Wester Maryland Area Teamsters and Employers Pension Fund
  62. Teamsters Local 469 Pension Plan
  63. Teamsters Local 641 Pension Plan
  64. Teamsters Local 837 Pension Plan
  65. Teamsters Union Local 52 Pension Fund
  66. UFCW Unions and Employers Midwest Pension Plan
  67. UFCW Unions and Employers Pension Plan
  68. UFCW Unions and Participating Food Industry Employers Tri State Pension Fund
  69. United Independent Union Newspaper Guild of Greater Philadelphia Pension Plan
  70. Warehouse Employees Local 169 and Employers Joint Pension Fund
  71. Warehouse Employees Union Local 730 Pension Trust Fund
  72. Western Pennsylvania Teamsters and Employers Pension Fund
  73. Western States Office and Professional Employees Pension Fund

Critical

  1. 1199 SEIU Greater New York Pension Plan
  2. 32BJ North Pension Fund
  3. Alaska Ironworkers Pension Plan
  4. Alaska Teamster Employer Pension Plan
  5. Alaska UFCW Trust Funds
  6. Allied Workers Local 48 Pension Plan
  7. Aluminum Brick and Glass Workers Union AFL CIO CLC Eastern District Council 12 Pension Plan
  8. Amalgamated Industrial and Toy and Novelty Workers of America Local 223
  9. American Federation of Musicians and Employers Pension Fund
  10. Asbestos Workers Philadelphia Pension Plan
  11. Asbestos Workers Union Local 64 Pension Fund
  12. Automotive Machinists Pension Trust
  13. Bakery Drivers Local 802 Pension Fund
  14. Birmingham Plumbers and Steamfitters Local Union 91 Pension Trust Fund
  15. Boston Plasterers Cement Masons and Asphalt Layers Union Local 534 Pension Plan
  16. Bricklayers and Allied Craftworkers Local 3 New York Buffalo Chapter Benefit Funds
  17. Bricklayers and Allied Craftworkers Local 5 of New Jersey Pension Plan
  18. Bricklayers and Masons Local 22 Pension Plan
  19. Bricklayers Local 1 of PA Pension Fund
  20. Bricklayers Union 1 of Kentucky Pension Trust Fund
  21. Building Service 32BJ Pension Fund
  22. Building Trades Pension Fund of Western Pennsylvania
  23. Carpenters Pension Fund of West Virginia
  24. Carpenters Pension Trust Fund for Northern California
  25. Cement Masons Union Local 592 Pension Plan
  26. Central New York Laborers Pension Fund
  27. Central New York Painters and Allied Trades Defined Benefit Pension Plan
  28. Cleveland Bakers and Teamsters Pension Fund
  29. Colorado Cement Masons Pension Trust Fund
  30. Connecticut Healthcare Associates Pension Plan
  31. Cumberland Maryland Teamsters Construction and Miscellaneous Pension Fund
  32. Dairy Industry Union Pension Plan for Philadelphia and Vicinity
  33. Electricians Pension Plan IBEW 995
  34. Employer Teamsters Locals 175 and 505 Pension Trust Fund
  35. Food Employers Labor Relations Association and UFCW Pension Fund
  36. Gastronomical Workers Union Local 610 and Metropolitan Hotel Association Pension Fund
  37. Hagerstown Motor Carriers and Teamsters Pension Fund
  38. IBEW Local 237 Pension Fund
  39. IBEW Local 673 Pension Plan
  40. IBEW Local Union 1158 Pension Plan
  41. IBEW Local Union 527 Pension Plan
  42. IBEW Local Union 98 Zone 2 Pension Trust Fund
  43. IBEW Pacific Coast Pension Fund
  44. ILA AFL CIO Employers Pension Fund Southeast Florida Ports
  45. ILA Local 1478 2 Pension Plan
  46. ILA Local Union 1922 Pension Fund
  47. Indiana Carpenters Pension Plan
  48. Industry and Local 338 Pension Fund
  49. Inlandboatmens Union of the Pacific National Pension Plan
  50. International Association of Machinists Motor City Pension Fund
  51. Ironworkers Local 25 Pension Plan
  52. Ironworkers Local 498 Defined Benefit Plan
  53. Ironworkers Local Union 402 Pension Fund
  54. Ironworkers Pension Trust Fund For Colorado
  55. Joint Board 18 Pension Fund
  56. Kansas Construction Trades Open End Pension Trust Fund
  57. Laborers AGC Pension Trust of Montana
  58. Laborers Local 130 Pension Fund
  59. Laborers National Industrial Pension Fund
  60. Laborers National Pension Fund
  61. Legacy Plan of the National Retirement Fund
  62. Legacy Plan of the UNITE HERE Retirement Fund
  63. Local 1034 Pension Fund
  64. Local 1245 Labor Management Pension Plan
  65. Local 150 Hotel and Industry Pension Plan
  66. Local 202 Sheetmetal Workers Pension Fund
  67. Local 2066 Pension Fund
  68. Local 298 Pension Fund
  69. Local 73 Retirement Plan
  70. Local 813 Pension Trust Fund
  71. Local 945 IBT Pension Plan
  72. Local Union 373 UA Pension Plan
  73. Lumber Industry Pension Plan
  74. Millmens Retirement Trust of Washington
  75. Minneapolis Retail Meat Cutters and Food Handlers Pension Fund
  76. New Bedford Fish Lumpers Pension Plan
  77. New Jersey Building Laborers Statewide Pension Fund
  78. New Orleans Employers International Longshoremens Association AFL CIO Pension Plan
  79. New York State Teamsters Conference Pension and Retirement Fund
  80. Northwest Bricklayers Pension Plan
  81. Office and Professional Employees International Union Pension Plan
  82. Ohio Bricklayers Pension Plan
  83. Ohio Carpenters Pension Fund
  84. Operating Engineers Local 324 Pension Fund
  85. Operative Plasterers and Cement Masons New Orleans Area Pension Plan
  86. Operative Plasterers and Cement Masons Officers and Employees Pension Plan
  87. PA Local 47 Bricklayers and Allied Craftsmen Pension Plan
  88. PACE Industry Union Management Pension Fund
  89. Pension Plan for Employees of United Furniture Workers of America
  90. Pension Plan of International Union of Bricklayers and Allied Craftworkers Local 15 Pennsylvania
  91. Pension Plan Private Sanitation Union Local 813 IBT
  92. Plasterers Local 8 Pension Plan
  93. Plumbers and Pipefitters Local 396 Pension Plan
  94. Plumbers Pipefitters and Mechanical Equipment Service Local Union 392 Pension Plan
  95. Roofers Local 75 Pension Fund
  96. Service Employees Pension Fund of Upstate New York
  97. Sheetmetal Workers Local 40 Pension Plan
  98. Sheetmetal Workers Local 44 Retirement Income Plan
  99. Soft Drink and Brewery Workers Union Local 812 Retirement Fund
  100. Sound Retirement Trust
  101. South Florida Electrical Workers Pension Plan
  102. Southern California UFCW Unions and Drug Employers Pension Fund
  103. Southern California UFCW Unions and Food Employers Joint Pension Trust Fund
  104. Southwest Marine Pension and Welfare Trust Funds
  105. Steamfitters Local Union 420 Pension Plan
  106. Teamsters Local 115 Pension Plan
  107. Teamsters Local 277 Pension Fund
  108. Teamsters Local 418 Pension Fund
  109. Teamsters Local 445 Pension Fund
  110. Teamsters Local 617 Pension Fund
  111. Teamsters Local Union 211 Pension Plan
  112. Toledo Area Sheetmetal Workers Pension Plan
  113. Twin Cities Bakery Drivers Pension Plan
  114. UA Local Union 322 Pension Plan
  115. UA Plumbers and Pipefitters Local 51 Pension Plan
  116. UFCW Heartland Pension Fund
  117. UFCW Local 1262 and Employers Pension Plan
  118. UFCW Local One Pension Fund
  119. UFCW Northern California Employers Joint Pension Trust Fund
  120. UFCW Regional Pension Fund
  121. UFCW Unions and Participating Employers Pension Fund
  122. Unión de Tronquistas de Puerto Rico Local 901 Pension Plan
  123. United Furniture Workers Pension Fund A
  124. UniteHERE Northwest Pension Trust Fund
  125. Upstate New York Bakery Drivers and Industry Pension Plan
  126. Upstate New York Engineers Pension Fund
  127. Utah Bakers Pension Trust Fund
  128. UTWA NJ Union Employer Pension Plan
  129. Western Metal Industry Pension Fund

Endangered

  1. Alaska Laborers Employers Trust Funds
  2. Alaska Laborers Trust Funds
  3. Alaska Plumbing and Pipefitting Industry Pension Plan
  4. Asbestos Workers Local 42 Pension Fund
  5. Automobile Mechanics Local 701 Union and Industry Pension Fund
  6. Boilermaker Blacksmith National Pension Trust
  7. Bricklayers Pension and Holiday Trust Funds Metropolitan Area
  8. Cement Masons Employers Pension Plan
  9. Cement Masons Local 886 and 404 Pension Plan
  10. Cement Masons Local Union 526 Pension Plan
  11. Central Laborers Pension Fund
  12. Construction and General Laborers Local 190 Pension Plan
  13. Engineers AGC Pension Plan of the Inland Empire
  14. Greater Pennsylvania Carpenters Pension Fund
  15. IBEW Local 150 Pension Fund
  16. IBEW Local 1579 Pension Plan
  17. IBEW Local 325 Pension Fund
  18. IBEW Local 688 Pension Plan
  19. IBEW Local 952 Ventura Division of Los Angeles County Chapter NECA Pension Trust Fund
  20. IBEW Local 952 Ventura Division of Los Angeles County Chapter NECA Pension Trust Fund
  21. IBEW Local Union 952 Ventura Division LA County Chapter NECA Pension Trust Fund
  22. IBEW Local 98 Pension Plan
  23. Insulators and Allied Workers Local 91 Pension Plan
  24. Ironworkers District Council of Southern Ohio and Vicinity Pension Trust
  25. Ironworkers District Council Philadelphia and Vicinity Retirement and Pension Plan
  26. Ironworkers Pension Plan of Western Pennsylvania
  27. Joint Pension Local Union 164 IBEW
  28. Laborers District Council Pension and Disability Trust Fund 2 (in Spanish)
  29. Laborers Local 17 Pension Fund
  30. Laborers Pension Trust Fund Detroit and Vicinity
  31. Laborers Union Local 1298 of Nassau and Suffolk Counties Pension Fund
  32. Local 1102 Retirement Trust
  33. Local 705 IBT Pension Fund
  34. Machinery Movers Riggers and Machinery Erectors Local 136 Supplemental Plan
  35. Massachusetts Bricklayers and Masons Pension Fund
  36. Mechanical Contractors UA Local 119 Pension Plan
  37. Michigan BAC Pension Fund
  38. Michigan Carpenters Pension Fund
  39. Michigan Laborers Pension Plan
  40. Motion Picture Laboratory Technicians and Film Editors Local 780 Pension Plan
  41. National Asbestos Workers Pension Plan
  42. National Basketball Association Players Pension Plan
  43. North Central State Regional Council of Carpenters Pension Benefit Funds
  44. Northwest Ironworkers Retirement Plan
  45. Northwest Ironworkers Retirement Trust
  46. NYSA ILA Pension Trust Fund
  47. Operating Engineers Pension Plan
  48. Operating Engineers Trust Funds
  49. Painters Union Pension Plan
  50. Pension Trust Fund for Operating Engineers
  51. Pipefitters Local 636 Defined Benefit Pension Fund
  52. Pipefitters Local 636 Fringe Benefit Funds
  53. Plasterers Local Union 1 Pension Plan
  54. Plumbers and Pipefitters Local 502 and 633 Pension Fund
  55. Plumbers and Pipefitters National Pension Fund
  56. Plumbers and Steamfitters Local 267 Pension Plan
  57. Plumbers Local 55 Pension Plan
  58. Plumbers Local 98 Defined Benefit Pension Fund
  59. Plumbers Local 98 Fringe Benefit Funds
  60. Roofers Union Local 30 Pension Plan
  61. Sheetmetal Workers Local 224 Pension Fund
  62. Sheetmetal Workers Local Union 80 Pension Plan
  63. Sheetmetal Workers National Pension Fund
  64. Sheetmetal Workers Pension Fund of Local Union 19
  65. Sheetmetal Workers Pension Plan of Southern California Arizona and Nevada
  66. Southern California IBEW NECA Pension Plan
  67. Southern Connecticut IBEW Pension Plan
  68. Suburban Teamsters of Northern Illinois Pension Fund
  69. Teamsters Pension Trust Fund of Philadelphia and Vicinity
  70. Transport Workers Union Westchester Private Bus Lines Pension Trust
  71. Tri State Carpenters and Joiners Pension Trust Fund
  72. Twin Cities Carpenters and Joiners Pension Plan
  73. UA Journeymen Plumbers and Journeymen Steamfitters and Pipefitters Local Union 357 Pension Plan
  74. UA Local Union 85 Plumbers and Pipefitters Pension Plan
  75. UA Locals 63 and 353 Joint Pension Trust Fund
  76. UA Plumbers and Steamfitters Local 521 Pension Trust Fund
  77. UFCW Local 1500 Pension Plan
  78. UFCW Union Local 1546 Pension Plan
  79. Upper Peninsula Plumbers and Pipefitters Pension Plan
  80. Will County Local 174 Carpenters Pension Plan

6 responses to this post.

  1. Posted by Friedman, Aharon on August 8, 2019 at 10:28 am

    Rep.. Schweikert pointed out this out in our mark-up.
    https://www.youtube.com/watch?v=TYp1UpQKQ-k
    1:21:50
    1:23:30

    From: Burypensions Blog
    Reply-To: Burypensions Blog
    Date: Thursday, August 8, 2019 at 11:12 AM
    To: Aharon Friedman
    Subject: [New post] Rehabilitation For All

    burypensions posted: “In their summary of the multiemployer bailout bill a consulting firm makes an interesting observation: Some plans may find it advantageous to significantly shift their mortality, investment return, or industry level assumption in order to be in critical “

    Reply

  2. Posted by MJ on August 8, 2019 at 7:12 pm

    John, how are you defining the difference between critical and endangered. I will admit that I did not look at each plan posted. Nut shell version maybe?

    Reply

    • Critical and endangered is based on funded ratios and the actuaries get to pick the assumptions upon which those ratios are calculated. Under 80% you are endangered. Under 65% you are critical. Then you have critical and declining where projections of when you run out of money come in (ie. by looking at cash flows) and if it’s going to be 15 years then you are critical and declining.

      Up until now you wanted as high a funded ratio as you could get so as not to scare the employers you had or the employers you were trying to get. That will likely change with this new law and it will be interesting to see how the mulitemployer actuarial shops cater to their clients to position them for the bailout money.

      Reply

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: