The Pension Benefit Guaranty Corp. approved a total of $238.5 million in special financial assistance to aid three struggling pension plans, the agency announced in a news release Sept. 10.
The Teamsters Local Union No. 469 Pension Plan will receive $107.7 million in special financial assistance, the Pension Plan Private Sanitation Union, Local 813 I.B. of T. will receive $106 million and the Local Union No. 226 International Brotherhood of Electrical Workers Open End Pension Trust Fund will receive $24.8 million, according to the PBGC.
Based in Hazlet, New Jersey, the Teamsters Local Union No. 469 Pension Plan covers 1,490 participants in the transportation industry and was projected to hit insolvency in 2028. Upon insolvency, the plan would have had to reduce benefits by approximately 55% below the benefits payable under the terms of the plan, the PBGC said.
The Pension Plan Private Sanitation Union, Local 813 I.B. of T. covers 3,349 participants in a range of industries, including private sanitation, transportation, demolition, rental cars and funerals. The plan — based in Long Island City, New York — is in critical status, according to the agency.
The Local Union No. 226 International Brotherhood of Electrical Workers Open End Pension Trust Fund is also in critical status, though that plan — based in Topeka, Kansas — covers 1,210 participants in the construction industry.
The special financial assistance will allow all of the plans to continue to pay benefits without reduction for many years into the future, the PBGC said.
After Democrats passed the American Rescue Plan in 2021, the law set up the Special Financial Assistance Program as a way to aid financially struggling multiemployer plans.
As of Jan. 1, 2022, the Teamsters Local Union No. 469 Pension Plan had a funding ratio of 32.4%, with $277.4 million in projected benefit obligations, according to the plan’s most recent Form 5500 filing. The plan had $68.5 million in assets as of Dec. 31, 2022, the filing showed.
The Pension Plan Private Sanitation Union, Local 813 I.B. of T. had a funding ratio of 37.8%, with $535.5 million in projected benefit obligations as of Jan. 1, 2022, according to the plan’s most recent Form 5500 filing. The plan had $164.1 million in assets as of Dec. 31, 2022, the filing showed.
As of Jan. 1, 2022, the Local Union No. 226 International Brotherhood of Electrical Workers Open End Pension Trust Fund had a funding ratio of 32.4%, with $242.8 million in projected benefit obligations, according to the plan’s most recent Form 5500 filing. The plan had $69.6 million in assets as of Dec. 31, 2022, the filing showed.
According to the news release, the PBGC has announced approval of over $68 billion in special financial assistance to plans covering approximately 1.16 million workers, retirees, and beneficiaries as of Sept. 10.
