Despite some last-minute uncertainty, Composite Pension Plans were included in the House COVID HEROES (Health and Economic Recovery Omnibus Emergency Solutions) bill (H.R. 6800) passed on May 15. While the Senate will not consider many of the provisions in the $3 trillion bill, it is possible pensions will be on the table there.
With the help of members and chapter executives in a variety of states, SMACNA was able to reach out to a number of key House members to counter efforts by unions, the Western Conference of Teamsters Plan, the Pension Rights Center, and others to pull Composite Plans from the bill. SMACNA also published a Myth vs. Facts document and cosigned a letter with other construction industry employers, both of which went to the full House in support of Composite Plan language.
If passed by the Senate, HEROES would also provide relief for failing plans in the form of “partitioning” of eligible plans to the Pension Benefit Guaranty Corporation (PBGC), while doubling the PBGC guarantee to protect retirees from drastic cuts. Federal money for partitioning would go to the PBGC and not to plans.
The bill also includes provisions which would mitigate plan funding issues created by the COVID-19 crisis. In relief similar to that granted after the 2008 stock market crash, the bill would allow smoothing of returns and amortization of losses, extension of fund improvement and rehabilitation periods, as well as freezing of zone status. The Senate appears to view those provisions favorably. Additionally, unrelated to pensions, the bill would provide COBRA subsidies up to 100 percent. In 2009, the COBRA coverage subsidy was 65 percent and most were not able to take advantage of the program.
H.R. 6800 now goes to the Senate, which isn’t expected to consider the bill until June. Any Senate bill will likely be different than the House bill and require passage by the House.
In the Senate, there has been an all-out lobbying campaign against Composites already. SMACNA members are encouraged to contact their Congressional delegation in support of Composite Plans. Questions and comments on pension reform can be directed to SMACNA’s Capitol Hill office at email@example.com or 202-547-8202.
Additionally, HEROES would provide funding for a wide range of groups, a new stimulus check, funding for state and local governments, hazard pay for essential workers, funding for coronavirus testing, rent and mortgage assistance, an extension of the $600 weekly unemployment expansion, additional funding for the Supplemental Nutrition Assistance Program, additional funding for small businesses, emergency relief for the U.S. Postal Service, and provisions for election safety and facilitating voting by mail.
Read the Forbes magazine May 17 article in strong support of Composite Plans.