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About Northwest labor press. (Portland , Ore.) 1987-current | View Entire Issue (May 18, 2018)
PAGE 2 | May 18, 2018 | NORTHWEST LABOR PRESS NORTHWEST LABOR PRESS ...Pension crisis sparks reform debate From Page 1 (International Standard Serial Number 0894-444X) Established in 1900 in Portland, Oregon as a voice of the la- bor movement. Published on a semi-monthly basis on the first and third Fridays of each month by the Oregon Labor Press Publishing Co. Inc., a non-profit mutual benefit corpo- ration owned by 20 unions and councils including the Ore- gon AFL-CIO. Serving more than 120 union organizations in Oregon and Southwest Washington. Office location: 4275 NE Halsey St., Portland, Oregon Mailing address: P.O. Box 13150, Portland, OR 97213 Phone: (503) 288-3311 Web address: http://nwlaborpress.org Editor & Manager: Michael Gutwig Associate editor: Don McIntosh Office manager: Cheri Rice Printed on recycled paper, using soy-based inks, by members of Teamsters Local 747-M. SUBSCRIPTIONS: Individual subscriptions are $15 a year for union members, $23 a year for all others. Pay by credit card online at nwlaborpress.org/subscribe, or send a check to our mailing address (above) along with your name, address and union affiliation, if any. Group rates of $10.56 a year per person are available for 25 or more subscriptions; call 503-288-3311 for details. CORRECTIONS: See an error? Please let us know at editor@nwlaborpress.org or by phone at 503-288-3311. PERIODICALS POSTAGE PAID AT PORTLAND, OREGON. CHANGE OF ADDRESS: If you move, let us know at nwlaborpress.org/subscriber-services or by mail at our mailing address (above). Be sure to provide your old and new addresses and the name/number of your local union. Please allow three weeks for the change to take effect. POSTMASTER: Send address changes to NORTHWEST LABOR PRESS P.O. BOX 13150 PORTLAND, OR 97213-0150 SHOP LOCAL. AND BUY UNION AND AMERICAN- MADE. Low Prices! Mon-Fri 9-6, Sat 9:30-5:30, Sun 12-6 aster for its 397,492 participants — including 165,000 now-re- tired truck drivers and factory workers who worked their whole lives expecting a pension. It would also push the govern- ment’s pension insurance pro- gram into insolvency — the Pension Benefit Guaranty Cor- poration (PBGC) multi-em- ployer program provides funds to pensions that run out of money so they can pay benefits to retired workers. And that’s not all. A Central States collapse could also push several national trucking compa- nies into bankruptcy, and even threaten the viability of UPS, America’s biggest commercial package delivery company. Combined, UPS and those trucking companies account for a sizable fraction of contribu- tions to the Western Conference pension. If they fail, the now- healthy Western Conference pension could be at risk. Mack, the Western Confer- ence pension co-chair, has been traveling all over the Western United States to talk about com- ing crisis of pensions, and op- tions in Congress to fix it. Central States is only the biggest of an estimated 102 multi-employer pension trusts that are projected to run out of money within 20 years, leaving 1.2 million active and retired union workers with just a frac- tion of the pension benefit they were promised. At least three of those declin- ing plans have members in the Portland area: Operative Plaster- ers Local No 82 Pension Trust Fund; Western States Office And Professional Employees Pension Fund, which includes union of- fice employees and workers at Northwest Natural who are members of OPEIU Local 11; and Bakery & Confectionery (B&C) Union & Industry Inter- national Pension Fund, which includes workers at the Portland Nabisco plant. In B&C’s case, the pension’s troubles are at the heart of a dramatic two year con- tract standoff with Nabisco [See related article on Page 1.] What went wrong Union-sponsored multi-em- ployer pension plans have long been an extraordinarily stable, efficient and flexible way for unionized employers to provide secure retirement benefits. The way they work, the employers typically contribute a certain dol- lar amount for each hour an em- ployee works, the amount spelled out under the terms of collective bargaining agree- ments they negotiated with the union. The funds are collected and invested long-term by the pension trusts. The trusts are overseen by equal numbers of union and employer trustees, who are advised by actuaries, ac- countants, administrators, attor- neys and investment managers. Based on how well they expect investments to perform, trustees promise a retirement benefit that grows or “accrues” for every dollar the employer contributes. By the time workers retire, the pension trusts will have invested decades of contributions on their behalf. Multi-employer pensions are most common in manufacturing, trucking, and industries like con- struction that have lots of small employers and workers that move from one employer to an- other. All told there are about 1,300 multi-employer pension trusts. All were battered by the 2000 and 2008 financial crashes, but more than nine tenths of them Turn to Page 3 FIVE FAILING FUNDS Central States Teamsters 397,492 participants, 83.8 % inactive 33% funded 7 years until insolvency United Mine Workers 1974 Plan 104,258 participants, 92.1% inactive 39.8% funded 5 years until insolvency Western States OPEIU 7,830 participants, 88.3% inactive 15 years until insolvency — except that the trust has asked the Treasury Department for permission to cut benefits 30 percent and thereby prevent insolvency Bakery & Confectionery Pension 113,040 participants, 79.9% inactive 42.6% funded 12 years until insolvency Operative Plasterers Local 82 Pension 274 participants, 74.4 percent inactive 62% funded 16 years to insolvency — except that the trust has asked the Treasury Department for permission to cut benefits 22 percent (31 percent for inactives) and thereby prevent insolvency
