The Pension Benefit Guaranty Corporation (PBGC) announced Dec. 23 that it approved another multiemployer plan application under the Special Financial Assistance (SFA) Program created by the American Rescue Plan Act of 2021 (ARP).
The assistance is going to the Idaho Signatory Employers-Laborers Pension Plan in Portland, OR, which covers 682 participants in the construction industry and was projected to run out of money in 2022. The plan will receive $13.9 million from the PBGC, including interest to the expected date of payment to the plan.
Without the SFA funds, the plan would have been required to reduce participants’ benefits to the PBGC guarantee levels upon plan insolvency, approximately 15% below the benefits payable under the terms of the plan.
Two days before, the PBGC had announced approval of the first multiemployer plan application under the SFA Program, to the Local 138 Pension Plan (Local 138) based in Baldwin, NY, which covers 1,723 participants in the transportation industry and had been projected to run out of money in 2022.
The PBGC on July 9 had announced an interim final rule implementing the SFA Program for financially troubled multiemployer pension plans. The program requires plans to demonstrate eligibility for special financial assistance and to calculate the amount of assistance under the ARP and the PBGC’s regulations.
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