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The $1.9 trillion coronavirus relief package includes money for a plethora of interests you might expect, such as funding for healthcare, roughly $350 billion for states and stimulus payments. But some Democrats are also angling for taxpayer-funded relief money to bail out pension funds that have ballooned over the years while many of the companies in question continued to pay their top-ranking employees millions of dollars.
The Pension Benefit Guaranty Corporation (PBGC) protects pensions of private-sector employees. PBGC says their financing comes from the insurance premiums that employers pay, along from investments, assets of pension plans that they preside as trustee over, but not from taxes. While pensions took a hit during the pandemic due to falling interest rates, corporations underfunded their pensions long before the pandemic. And now, taxpayers might pick up the cost.
The much-heralded Butch Lewis Emergency Pension Plan Relief Act of 2021 is part of the COVID-19 relief bill, which is set for a vote in the House. The Butch Lewis Act of 2021 addresses the plight of multiemployer and single-employer pension plans after COVD-19.
I – Overview of the Butch Lewis Emergency Pension Plan Relief Act
The much-heralded
Butch Lewis Emergency Pension Plan Relief Act of 2021 (the “Butch Lewis Act of 2021”) is closer to becoming a reality as part of the COVID-19 relief bill, which is set for a vote in the House of Representatives on February 26, 2021. The Butch Lewis Act of 2021 strives to address the plight of multiemployer and single-employer pension plans in the wake of COVD-19. Here we discuss only the multiemployer pension plans. Representative Richard Neal (D-MA), chairman of the Ways and Means Committee of the House, proposed this bill. The bill has been fast-tracked.
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Across the United States, 10.8 million workers and retirees belong to about 1,400 multiemployer (union) pension plans.REF These plans are massively underfunded having promised $673 billion more in pension benefits than they have set aside to pay, and now Congress is poised to hand a select group of these plans at least $86 billion in unconditional taxpayer bailouts.
Succumbing to the pressure of unions that failed often recklessly to deliver the secure retirements they promised their dues-paying members, lawmakers have included this pension bailout in the so-called COVID-19 relief package.
Yet these broken pension promises started many decades before COVID-19, and multiple pension-bailout proposals have been introduced, without success, in recent Congresses. The most recently available data showing a $673 billion funding shortfall is based on pensions’ 2017 financial reports.REF Since then, the S&P 500 has increased by more than 50 percent. Yet, most multiemplo
Up to 30 employees laid off from Decker Mine could be rehired. (Photo from Sheridan MEdia files)
A federal court has approved a tentative agreement under which up to 30 employees of Decker Coal Mine could be rehired to complete reclamation or cleanup of the mine site north of Sheridan.
Utah-based Lighthouse Resources Inc., which owns the mine, declared bankruptcy last December, and in January, mining ceased and the vast majority of the company’s workforce was laid off amid a sharp decline in demand for coal to generate electricity.
Earlier this week, the court approved an agreement struck between attorneys for Lighthouse Resources and the United Mine Workers of America that would allow the rehire. Lighthouse Resources laid off over 70 workers at the Decker Mine in December when the company declared bankruptcy. Additional workers were laid off in January, and by Jan. 22, when the company had stopped mining for coal, only four union workers were still at the Decker facility.