Sunday, November 19, 2017
The Teamsters Union strongly supports legislation introduced today by Sen. Sherrod Brown (D-OH) and Rep. Richard Neal (D-MA) that would establish a new agency within the U.S. Treasury Department authorized to issue bonds in order to finance loans to pension plans in financial distress.
The “Butch Lewis Act of 2017,” named after a Teamster retiree leader who passed away two years ago, would provide a path to fixing the country’s growing pension crisis by providing the financial support the plans need to avoid insolvency. Teamsters General President Jim Hoffa expressed the union’s full support in a video statement.
“The Teamsters Union proudly endorses the Butch Lewis Act without any reservations,” Hoffa said.
“Between the hard work of Sen. Brown and Rep. Neal’s offices and our Teamster pension task force, I believe we have found a solution to this very difficult challenge.”
The agency, named the Pension Rehabilitation Administration (PRA), would provide these loans to “critical and declining” multiemployer pension funds. The loan terms will require plans to make interest payments for 29 years with final interest and principal repayment due in year 30.
“This is a plan that will work,” Brown said. “This is a plan that will work without cuts.”
“Americans who worked hard their entire lives and planned for secure retirements should not have the rug pulled out from under them,” Neal said. “With this bill, we responsibly shore up multiemployer pension plans and guarantee retirees the full benefits they earned.”
Rita Lewis, the widow of Butch Lewis, spoke passionately about the four-year fight her husband led to save the pensions of thousands of active and retired Teamsters in the Central States Pension Fund.
“No one should have to suffer through the past four years of stress,” Lewis said. “This bill must be passed by the end of the year – this is not a partisan issue. We’ve been held hostage long enough. A promise is a promise is a promise.”
Financial problems have left the pension plan severely underfunded and could force cuts in pension payments to hundreds of thousands of retirees nationwide.
Sponsors of the bill, including Reps. Debbie Dingell of Dearborn and Dan Kildee of Flint Township, say the legislation would shore up the Central States Pension Fund and 200 other multiemployer pension plans in danger of insolvency in the next 10 years.
The Rehabilitation for Multiemployer Pensions Act would create a new office in the U.S. Treasury Department to issue bonds to finance loans to distressed pension plans, allowing them to remain solvent and continue to provide benefits for retirees and workers.
“The No. 1 thing is there would be no cuts for workers,” Dingell said in an interview. “They put their money in for a lifetime. Can you imagine what it’s like to work a lifetime, live by the rules, get to your 70s and suddenly have no retirement security?”
Dingell said she hopes to convince some Republican colleagues to sign onto the bill, increasing its chances of getting a vote on the House floor.
Last year, the Treasury Department rejected a Central State Pension Plan proposal that would have cut retiree benefits by as much as 70 percent, affecting an estimated 273,000 retirees.
Treasury rejected the proposal based on a review by outside attorney Kenneth Feinberg, a victim compensation expert, who concluded the plan didn’t demonstrate how the reductions would keep the pension plan from becoming insolvent or show they were being equitably distributed.
The lead sponsors of the legislation are Democratic Rep. Richard Neal of Massachusetts and Sen. Sherrod Brown of Ohio.