Retirees still desperately seeking fix for troubled multi-employer pensions

WASHINGTON — Rita Lewis accepted Sen. Sherrod Brown’s invitation to the State of the Union address this year with a singular thought in mind: Perhaps she could once again draw attention to the plight of the nearly 1.3 million retirees at risk of losing their endangered pensions.

The West Chester woman’s husband, retired truck driver Butch Lewis, died on New Year’s Eve 2015 worrying about the pension crisis and its impact both on him and his fellow retirees. When he died, Rita Lewis took up the fight.

More than three years later, the problem still looms.

 

Last year, a joint committee of House members and senators vowed to solve the problem of what to do with troubled multi-employer pensions. They had until Nov. 30 to come up with a solution. They missed the deadline, but Brown and fellow Ohio Sen. Rob Portman, who have more than 60,000 constituents saddled with these troubled plans, vowed to press on.

But now, two months into the 2019, a solution that both sides can agree on remains out of reach. For Rita Lewis and other affected retirees, it’s a unique brand of purgatory, tempered by high hopes and deep disappointments.

“We always get so close to something, then there’s a major development, whether it’s a hurricane or a disaster and the pecking order changes,” she said.

“I’m told it’s a priority,” said Mike Walden, head of the Teamsters’ National United Committee to Protect Pensions. “It’s just the (federal government) shutdown has taken away some things and readjusted the priorities.”

Walden, a retired truck driver from Cuyahoga Falls, was a member of the Central States’ pension program — a multi-employer pension that allowed employers to pool resources and provide workers with retirement security.

In 2015, Central States offered a proposal that would slash retirees’ benefits. The Treasury Department ultimately rejected that plan, and the pensioners have remained in limbo ever since.

The fund continues to bleed money: The 2018 third quarter Financial and Analytical Report on the Central States Teamsters Fund, the pension that Butch Lewis was in, found it had $14.1 billion in assets as of Sept. 30, 2018 — $1 billion less than the start of 2018.

Brown, a Democrat who co-chaired the joint committee tasked with solving the problem, has vowed to keep fighting. Even as he weighs a bid for the White House, he insists his commitment to solving the problem hasn’t changed. Last year, he introduced a bill named after Butch Lewis that aimed to end the crisis by creating a loan program for plans in critical, declining and insolvent status.

“Except for keeping the government open, there is no greater legislative priority in my mind,” he said.

Portman, a Republican who also served on the committee, was named this year to chair the Senate Finance Committee’s Subcommittee on Social Security, Pensions and Family Policy. He also said the endangered pensions are very much on his mind.

Letting the pensions fail, he said, “would hurt the entire economy.”

Elsewhere, the environment has shifted. With Democrats now holding the House majority and Rep. Richard Neal, the chairman of the powerful House Ways and Means Committee, serving as the main House backer of the Butch Lewis bill, it seems plausible, if not likely, that the House will pass that measure. But its chances in the Senate remain grim.

The conventional wisdom is that the longer Congress waits to act, the worse it will get. Among the key worries is the “contagion effect” — the idea that if those pensions fail, others will follow, cascading to create a financial crisis.

David Brenner, senior vice president and national director of multi-employer consulting for Segal Consulting, said the government has an obligation to help because it contributed to the shortfall in the first place.

The deregulation of the trucking industry in the 1970s — a government action — as well as market crashes because of a deregulation of Wall Street contributed to the affected pensions’ troubles.

“When you look at the roots of the problem, the government has a very heavy hand in it, which is something not a lot of people pay attention to,” he said.

Despite the committee’s failure so far, he is optimistic.

“If these plans go under, where are people going to go? They’ll start relying more on the social safety net and government programs. One way or the other, someone’s going to pay for this.”

Walden predicts that there will be little action on the issue until March or April, as Congress deals with the aftermath of the shutdown and basic organizational work.

He said there has been something of a sea change among Republicans, an urgency that may translate to action.

“People are concerned on both sides of the aisle,” Walden said. “We’re all just kind of waiting around to see what they come up with before we make our next move.”

Both he and Rita Lewis are troubled that so little attention is being paid to the issue. When the government shut down, 800,000 people lost their paychecks. Though it was appropriate that so many worried about them, they argue that the pension crisis merits attention, too.

“We just went and spent $11 billion on the shutdown,” said Rita Lewis, referring to the costs of closing the government for 35 days. “We could’ve used that money to secure our pensions.”

Source: https://www.dispatch.com/news/20190211/retirees-still-desperately-seeking-fix-for-troubled-multi-employer-pensions

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