The Butch Lewis Watch
Pension Legislation blog by MPS Legal Counsel Jonathan Kantor
Congress’ effort to solve the multiemployer pension problem is underway. The public hearings of the Joint Select Committee on Solvency of Multiemployer Pensions began in April. As an organization, it has been a top priority of ours to be actively involved in Washington, D.C. lobbying on behalf of musicians around the country for legislation that would help our pension fund.
The legislative process can be very complicated and the problems affecting multiemployer pension funds are very complex. With that in mind, MPS wants to provide a quick and easy way for musicians to stay up to date and easily understand all aspects of the legislative process that the Joint Select Committee will be dealing with moving forward.
So MPS is launching a new blog called The Butch Lewis Watch which will be an ongoing commentary on Congress’ effort to solve the multiemployer pension problem. Written by MPS legal counsel Jonathan Kantor, the blog will be regularly updated with any and all relevant information. Our very first installment today covers the first public hearing of the Joint Select Committee. We hope you enjoy the blog.
Consensus for Government Loan Program Gains Supporters – But with Strings Attached
June 14, 2018
Butch Lewis Watch – Installment #3
By Jonathan Kantor
The Select Committee on Multiemployer Pensions conducted its third hearing yesterday and heard from two key witnesses who voiced support for the concept of government-sponsored loans as a means of shoring up failing multiemployer pension plans. However, the panelists also stated that they believed workers’ pensions should also be cut as part of the deal. The two key panelists were Chris Langan, a finance executive with United Parcel Service, and Aliya Wang, Executive Director of Retirement Policy for the United States Chamber of Commerce, a lobbying organization which represents the business sector.
UPS made its government loan proposal in 2017, under which worker pensions would be cut up to 20%. The U.S. Chamber of Commerce came out in favor of government-sponsored loans several months ago, joining together with the NCCMP, which also supports the loan program. (As you may recall, NCCMP is the trade association in Washington for multiemployer plans. It was instrumental in the formulation of MPRA, the 2014 law that allows trustees to cut our accrued pension benefits.) However, the NCCMP has also proposed that government loans not be made available to plans like AFM-EPF.
Select Committee on Multiemployer Pensions Hold Hearings on the PBGC
May 21, 2018
Butch Lewis Watch Installment #2
By Jonathan Kantor
On May 17, the Select Committee on Multiemployer Pensions held a two-hour hearing on the Pension Benefit Guaranty Association (PBGC). The sole witness was Thomas Reeder, the current head of the PBGC.
First, a little background. The PBGC was created in 1974 when Congress passed the Employee Retirement Income Security Act, ERISA, the purpose of which was to provide pension security to Americans. Pension security rested on two pillars. One pillar was the "anti-cutback rule" which provided that a pension already earned from past labor could not be cut. The second pillar was the PBGC, a Government sponsored insurer of last resort, which would step in and pay pension benefits if the pension plan became insolvent. The idea was that, as President Gerald Ford said when signing ERISA into law, “the retirement dollars will be there when they are needed.”
The Surprise Topic at the First Hearing for the Joint Select Committee
April 22, 2018
Butch Lewis Watch Installment #1
By Jonathan Kantor
On April 18 the Joint Select Committee on Multiemployer Pensions held a two-hour hearing at which the panel heard from two experts who provided a briefing on the history and dimensions of the multiemployer pension problem. By design, there was little discussion of possible legislative fixes to the problem. The panel wanted to understand the problem first.
The questions asked by the Senators and Congressmen included basic questions of how multiemployer pension plans are governed, how plans do actuarial projections, and the assumptions used in those projections. One area that received attention from the Republican side, particularly from Congressman Schweickert (R-PA), was the investment return assumption. Another area of questioning was the financial condition of the Pension Benefit Guarantee Corporation. Many lawmakers stated that the problem with multiemployer pensions was getting worse and there was a need to act soon.