The Pension Benefit Guaranty Corp. approved special financial assistance applications totaling more than $1 billion to aid three struggling multiemployer pension plans.
UFCW Local One Pension Plan will receive approximately $764 million; the IUE-CWA Pension Plan will receive approximately $260 million; and the Newspaper Guild International Pension Plan will receive approximately $62 million, the PBGC announced Wednesday and Thursday.
Created by the American Rescue Plan Act that Democrats passed in March 2021, the SFA Program is designed to shore up struggling multiemployer pension plans through 2051.
The Oriskany, N.Y.-based UFCW Local One plan covers 19,177 participants in the service industry and was projected to become insolvent 2026, according to a PBGC news release.
The IUE-CWA plan, based in Pittsburgh, covers 13,760 participants in the manufacturing industry and was projected to become insolvent in 2029.
And the Washington-based Newspaper Guild International plan, which covers 5,824 participants in the printing industry, was projected to become insolvent in 2034.
Without the SFA Program, the plans would have been required to reduce participants' benefits to the PBGC guarantee levels upon plan insolvency, which is roughly 15% below the benefits payable under the terms of the plans, the PBGC said. The respective SFA payments will enable the plans to continue to pay retirement benefits without reduction for many years into the future, the PBGC added.
The UFCW Local One Plan had a funding ratio of 34% with $742 million in projected benefit obligations as of Jan. 1, 2021, according to the plan's most recent Form 5500 filing. As of Dec. 31, 2021, the plan had $249 million in assets, the filing showed.
The IUE-CWA plan had a funding ratio of 61% with $474 million in projected benefit obligations as of Jan. 1, 2021, according to the plan's most recent Form 5500 filing. As of Dec. 31, 2021, the plan had $288 million in assets, the filing showed.
The Newspaper Guild International plan had a funding ratio of 89% with $123 million in projected benefit obligations as of Jan. 1, 2021, according to the plan's most recent Form 5500 filing. As of Dec. 31, 2021, the plan had $110 million in assets, the filing showed.
Prior to these announcements, the PBGC as of Tuesday had approved nearly $52.2 billion in special financial assistance to plans that cover nearly 751,000 workers, retirees and beneficiaries, the PBGC said.
