The Case for New Trustees

On April 4th at the MPS National meeting, we introduced the MPS Action Plan.  A central part of MPS’ Action Plan is to implement Board reform and these are the changes we would like to make:

MPS Plan For Board Reform

  • Replace five of the eight union trustees, require that the new trustees all have financial literacy

  • Bring investment expert onto the Board; require that all members of Investment Committee have financial literacy

  • Bring an actuarial expert onto the Board

  • Disclose on the AFM-EPF website the qualifications of each trustee; what skill they bring to the table

This simply means replacing many of the current trustees to make way for experienced financial, actuarial and investment experts to form a new team of consummate professionals that will work toward a sound future for our pension fund. Since we introduced this idea of Board reform we have gotten a lot of questions. The following is the answer to those questions and the case for new trustees.

MPS Responds to Peter de Boor's Article in Senza Sordino

We read with astonishment Peter de Boor’s “Dropping the Mute” in the June 2018 issue of Senza Sordino where he says MPS is asking for “enormous contribution increases” to help stabilize the AFM-EPF.

MPS is asking for 6% contribution increases over the next five years and 2.9% thereafter. This is a modest request, considering that, according to recent Congressional testimony, employer contributions are increasing at the rate of 6.9% per year, and have been over the past five years.

Federal Judge Calls AFM-EPF Trustees’ Investment Approach “Extraordinarily Risky”

Anyone who still thinks that the crisis at the AFM-EPF was not caused by the mismanagement of our trustees should read the transcript of a recent hearing before the Federal Judge overseeing the Snitzer class action. You can find the complete transcript here. As many of you know, Local 802 members Andy Snitzer and Paul Livant filed a class action lawsuit against the AFM-EPF trustees, charging them with breaches of fiduciary duty. On April 26, the federal judge conducted a hearing on the case, and after that hearing entered an order denying the trustees’ attempt to have the case dismissed.

MPS Year One Report and Fundraiser Update

Musicians for Pension Security celebrated its first anniversary in April. Thanks in large part to the overwhelming support from fellow musicians across the country, we have had a very successful year. 
 
Since April of 2017, MPS has built a network that now connects 20,000 fellow musicians across the country who are in search of more information about the state of our pension and desire more transparency and accountability from the AFM-EPF Trustees. 

AFM-EPF Avoids Critical and Declining Status but Trustees Still Have No Plan for the Future

The board of trustees of the AFM-EPF met this past week and decided to keep our pension plan out of critical and declining status for another fiscal year. That means we are spared the 25-30% cuts they have been planning since 2015. But the fact remains that, as our trustees stated in January of this year, our plan is “on the brink of entering critical and declining status in the near future.” The only thing saving us is that last year was one of the best years the US stock market has ever seen. No one is counting on that lucky circumstance again.  

Congressional Testimony Validates Major Component of the MPS Action Plan

New congressional testimony validates a major component of the MPS Action Plan just weeks after AFM-EPF trustees dismissed the plan as “based on a distortion of facts.”
 
The AFM-EPF trustees are contemplating potential cuts of 25-30% to our existing pension benefits. MPS and Tom Lowman, one of the country’s leading actuaries, recently proposed a comprehensive Action Plan that could help the AFM-EPF for decades to come. The Action Plan included a three-year delay of benefit cuts, negotiating 6% increase in employer contributions for five years, then reverting to 2.9% per year over the next 25 years. We have shown that if the trustees execute our plan and raise employer contributions, much milder cuts could take place, and would not happen for at least three years. Unfortunately, less than 48 hours after we proposed the plan our trustees refused to even consider it. They state that our call for a three-year delay in benefit cuts is “based on a distortion of facts”and is “just empty rhetoric.”[1]However, recent congressional testimony debunks those statements by the trustees and proves that a growth target of 6% in employer contributions is, in fact, attainable. 

Trustees Call Class Action Lawsuit “Frivolous” but a Federal Judge Disagrees

As many of you know, Local 802 members Andy Snitzer and Paul Livant filed a class action lawsuit against the AFM-EPF trustees, charging them with breaches of fiduciary duty. Trustees Ray Hair and Tino Gagliardi repeatedly called the lawsuit “frivolous.” But the federal judge overseeing the case believes it is not frivolous, and on April 26, entered an order denying the trustees’ attempt to have the case dismissed. The case will now proceed with discovery and an eventual trial.

Trustees Call Class Action Lawsuit "Frivolous" but a Federal Judge Disagrees

As many of you know, Local 802 members Andy Snitzer and Paul Livant filed a class action lawsuit against the AFM-EPF trustees, charging them with breaches of fiduciary duty. Trustees Ray Hair and Tino Gagliardi repeatedly called the lawsuit “frivolous.” But the federal judge overseeing the case believes it is not frivolous, and on April 26, entered an order denying the trustees’ attempt to have the case dismissed. The case will now proceed with discovery and an eventual trial.

Great Start to the MPS Spring Fundraiser

The MPS Spring Fundraiser is off to an incredible start. We set a goal to raise $15,000 by June 1st. Thanks to your generosity and quick action we are well on our way to achieving that goal! 


But we still need your help to reach our $15,000 goal!!!


2018 is a crucial year. Your donations will go a long way in helping to secure a more certain future for our pension fund. As You know, we are an all-volunteer organization working on behalf of fellow musicians across the country. Every single dollar donated to MPS goes directly to protecting our pension. 

Thanks for a Great Meeting - Now MPS Needs Your Help!

MPS 2018 Fundraising Drive

 
Last summer we asked for your help and you overwhelmingly responded to our fundraiser. We reached our $15,000 goal in less than two weeks thanks to your quick action and generosity. That allowed us to hire one of the country's leading actuaries Tom Lowman. The MPS team now has a viable Action Plan thanks to our experts. This spring, MPS once again needs your help to advocate for that plan and many other initiatives in the coming months. 

MPS Response to AFM-EPF Trustees

It only took 48 hours after the Musicians for Pension Security national meeting on April 4th for the AFM-EPF Trustees to reject each and every proposal we made, casually brushing aside months of careful work by our team of experts. Rather than engaging in a dialogue concerning the positive and creative recommendations we made for lessening the impact of cuts to our pensions, cutting expenses, or reforming the board, the Trustees chose to question our motives and attack our all-volunteer organization that works on behalf of fellow musicians across the country. Read the letter the trustees sent to us on 4/6 here.

Trustees Investigate Cuts

AFM President Ray Hair hosted a “Webinar” for pension plan participants on January 29. When asked, President Hair and the other participants would not shed any light on the extent of the possible benefit cuts: “At this time, we just don’t know,” they said. Hair and the other trustees may not know exactly how extensive or when the cuts will happen, but according to their own documents recently obtained by MPS (linked below), it seems that they know far more about the potential for benefit cuts then they let on.

    UPDATE on the Butch Lewis Act

    Unfortunately, the Butch Lewis Act did not make it into the bipartisan budget deal the U.S. Senate passed last week. However, this is no reason to give up hope. As a compromise, a bipartisan House and Senate Joint Select Committee, led by Senator Sherrod Brown, will be tasked with coming up with a solution to the pension crisis by the last week of November 2018. You can read the details about the committee on his website here.