The Pension Benefit Guaranty Corp. approved two more applications for a federal assistance program that helps struggling multiemployer plans.
Teamsters Local 617 Plan, Ridgefield, N.J., will receive $155 million under the Special Financial Assistance Program, and the Retirement Benefit Plan of GCIU Detroit Newspaper Union 13N, Warren, Mich., will receive $106 million, according to two news releases Tuesday.
The PBGC began providing financial assistance to the Teamsters plan, which covers 891 participants in the transportation industry, in March 2020 when the plan became insolvent. At that time, the Teamsters plan reduced participants' benefits to PBGC guaranteed levels, about 65% below the benefits payable under the terms of the plan.
The PBGC began providing financial assistance to the newspaper union plan, which covers 563 participants in the printing industry, in April 2019 when the plan became insolvent. At that time, the newspaper union plan reduced participants' benefits to PBGC guaranteed levels, about 35% below the benefits payable under the terms of the plan.
The Special Financial Assistance Program was created by the American Rescue Plan Act, which President Joe Biden signed into law in March 2021.
The program provides assistance for a multiemployer plan if it satisfies one of four criteria: It has been in critical and declining status in any plan year beginning in 2020 through 2022; it has had its benefits suspended as of March 11; it is in critical status, has a modified funding ratio below 40% and has a ratio of active to inactive participants of less than 2-to-3; or it became insolvent after Dec. 16, 2014, but as of March 11 has not been terminated.
