HVAC Breaking News

April 27, 2004: Pension Bill Offers Little Relief For Multiemployer Plans

CHANTILLY, Va. - Despite last minute efforts by the Sheet Metal and Air Conditioning Contractors' National Association (SMACNA) to secure significant relief provisions for multiemployer plans in the Pension Funding Relief Act of 2004 (H.R. 3108/P.L. 108-218), a narrowly tailored relief reported by the Senate-House conference committee was approved 78 to 19 in final passage by the Senate, says the association.

It is estimated the law will provide relief to only about 2 percent of multiemployer pension plans facing a funding deficiency, says SMACNA. The law provides $80 billion in relief over 2 years for more than 31,000 companies that operate traditional pension plans, including relief for struggling industries that exposes the Pension Benefit Guaranty Corporation (PBGC) to additional risk, the association says.

According to SMACNA, the multiemployer plan relief previously passed by the Senate but rejected by House Republicans would have provided meaningful relief to plans, would have been at no cost to the Treasury, and would not have put the PBGC at risk.

In a letter to President Bush, prior to the Senate vote, SMACNA urged that the administration reconsider its opposition to temporary relief for multiemployer pension plans facing technical funding deficiencies within the next few years.

"We are not asking for relief from a substantial portion of funding obligations," the letter stated. "The plans simply want a modest deferral of the amortization of recent investment losses so that the bargaining parties and plans can fix our own problems. This modest relief will not put plans or the PBGC in jeopardy and will not impose any cost on the Treasury."

Publication date: 04/26/2004

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