Retired Teamsters Seek Action to Save Pensions
May 26, 2016
By: Tom Jackson, Sandusky Register
May 26, 2016
The local retired truck drivers who depend upon the Teamsters' Central States Pension Fund to maintain their retirements don't have to worry about their pensions being slashed right away.
The Department of the Treasury's rejection of a proposed plan to slash pensions by as much as about 60 percent, starting July 1, provides time for a better solution that will save the pension fund, local retired Teamsters members told the Register.
It appears that any permanent solution may have to come from Congress.
The trustees for the Central States Pension Fund had proposed the cuts, arguing that the painful cuts were the only way to preserve a fund that's in financial trouble and could run out of money in less than 10 years.
But on May 6, the U.S. Department of the Treasury rejected the plan, in effect canceling the big cuts.
The pension fund trustees aren't going to try again to come up with a pension rescue plan but will rely on the U.S. Congress to come up with something, Thomas Nyhan, the executive director of the Central States Pension Fund, said in a statement May 19.
"The rescue plan was a proposal of last resort, and clearly not the option that the trustees preferred. It was, however, based on a realistic assessment that benefit reductions under a rescue plan were the only available, practical way to avoid the hardship and countless personal tragedies that will result if the pension fund runs out of money," Nyhan said.
An infusion of government money is the only way to save the Central States fund, or the government Pension Benefit Guarantee Corporation, which would kick in if the Central States fund ran out of money, Nyhan said.
But three northern Ohio retired Teamsters interviewed by the Register said they were pleased by Treasury's action, saying it heads off immediate cuts and gives time to fix the situation.
"This has given us new hope," said Mike Walden, a retired Teamster who lives in Cuyahoga Falls and who is chairman of the Northeast Ohio Committee to Protect Pensions, a group of retired Teamsters working to resolve the issue.
"That bought us time," Walden said. "They're not going broke tomorrow, or next year, or two years from now."
Walden said he's been talking to members of Congress about the situation.
U.S. Rep. Marcy Kaptur, D-Toledo; U.S. Sen. Sherrod Brown, D-Ohio, and U.S. Sen. Rob Portman, R-Ohio, all have worked on the issue, and Kaptur has worked particularly hard, Walden said.
Brown told reporters Wednesday that he is pushing to fix pensions for coal miners, which is easier to do, and then wants to move on to fixing the situation for Teamsters retirees.
The United Mine Workers pension plan is severely underfunded, and Brown is seeking for Congress to protect miner pension and health benefits by transferring funds from the Abandoned Mine Land program.
He released a letter to Senate Majority Leader Mitch McConnell, urging action on both pensions for miners and for multi-employer pension programs such as Central States.
In his letter, Brown noted that the Pension Benefit Guarantee Corporation, the backup program for Central States, is itself going broke.
"In its 2015 Annual Report, the agency noted that it had just $2 billion in accumulated assets from premium payments made by multiemployer plans. Therefore, when these troubled plans become insolvent and need the assistance of the PBGC, the PBGC may already be insolvent and unable to pay benefits," Brown wrote.
According to figures supplied by U.S. Sen. Sherrod Brown's office, Ohio has 25,746 Central States retirees, with another 7,960 people who are paying into the fund with expectations of getting a pension. There are about 401,000 regional participants.
Retired Dave Kilbride, 72, Berlin Heights, faced a 63 percent cut in his pension, from $2,900 a month to about $1,178, if the Treasury hadn't axed the Central States plan.
Walden, Kilbride, 72, Berlin Heights, and Al Ewing, 74, Norwalk, are particularly angry because they believe retired Teamsters have been excluded from having a say as the trustees for the Central States Pension Fund debated a bailout plan.
Susan Mauren was supposed to serve as the retiree representative to the trustees, but the men said they believe she has not been helpful.
"She has never answered one thing I have sent her," Walden said. "She has never responded to any invitations to meetings."
"She hung up on me," Kilbride said.