The Pension Benefit Guaranty Corporation has approved the applications submitted to the Special Financial Assistance Program by three more struggling multiemployer pension plans.
The PBGC has agreed to provide $155.8 million to the Teamsters Local 617 Pension Plan, $105.6 million to the Retirement Benefit Plan of GCIU Detroit Newspaper Union, and $40.8 million to the Graphic Communications Union Local 2-C Retirement Benefit Plan. They are the 11th, 12th, and 13th plans approved by the PBGC for bailout funds under the SFA program.
The Ridgefield, New Jersey-based Local 617 Plan became insolvent in March 2020, at which time the PBGC began providing financial assistance. The plan was required to reduce benefits for its 891 participants to the PBGC guarantee levels, which were approximately 65% below the benefits payable under the terms of the plan. [Source]
However, the SFA approval allows the plan to restore all benefit reductions caused by the plan’s insolvency and to make payments to retirees to cover prior benefit reductions.
In addition to the $155.8 million paid to the plan, the PBGC’s Multiemployer Insurance Program will be repaid $11.1 million, which is the amount of the plan’s outstanding loans, including interest, paid for by the agency since March 2020.
The plan for the Detroit Newspaper Union, which covers 563 participants in the printing industry, has been receiving financial assistance from the PBGC since it became insolvent in April 2019. The plan reduced participants’ benefits to the PBGC guarantee levels, which were roughly 35% below the benefits payable under the plan prior to insolvency. [Source]
In addition to the $105.6 million the plan will receive, $13.4 million will be repaid to the Multiemployer Insurance Program for the financial assistance PBGC will have provided in total over the course of more than three years.
And the Warren, Michigan-based Graphic Communications Union Local 2-C Retirement Benefit Plan, which covers 535 participants in the printing industry, has been insolvent for more than seven years. The plan had to cut its participants’ benefits to approximately 60% below the benefits payable under the terms of the plan. [Source]
As a result, the Multiemployer Insurance Program will be repaid $18.3 million to cover the amount in financial assistance the PBGC has provided since January 2015.
Related Stories:
PBGC to Provide Nearly $700 Million to 3 Insolvent Multiemployer Plans
New York City-Based Multiemployer Plans Approved for PBGC Bailout
PBGC Bails Out Struggling NY Pension With $112.6 Million in Aid
Tags: Detroit Newspaper Union Plan, PBGC, Pension Benefit Guaranty Corporation, Retirement Benefit Plan of GCIU Detroit Newspaper Union, SFA, Special Financial Assistance, Teamsters Local 617 Pension Plan, the Graphic Communications Union Local 2-C Retirement Benefit Plan