CENTRAL STATES PENSION FUND AND THE JOINT SELECT COMMITTEE
FREQUENTLY ASKED QUESTIONS
What is Central States doing to support legislation to protect our participants’ pension benefits?
Central States Pension Fund supports any legislative solution that protects participants’ benefits, and we are committed to working constructively with Congress. Absent Congressional action, the Central States Pension Fund will become insolvent by 2025 and participants and beneficiaries will experience large benefit reductions. The Fund has an enormous imbalance between active participants and retirees who receive benefits. Currently, the Fund pays out approximately $2.8 billion in pension benefits each year but collects only $700 million in contributions and withdrawal liability payments. Investment returns cannot possibly offset this imbalance.
Legislative action is needed immediately to address the Fund’s fiscal crisis. Every day that passes without legislative relief will put the Fund one step closer to insolvency and will, in short order, put the possibility of a rescue out of reach.
Why doesn’t Central States support the HR.4444 / S.2147 Butch Lewis Act?
As stated above, Central States Pension Fund supports any legislative solution that protects participants’ benefits, and we are committed to working constructively with Congress to achieve that solution. In fact, Central States provided Congress with an analysis of the Butch Lewis Act (H.R. 4444 / S. 2147) concluding that based on reasonable assumptions; the bill would resolve the dire financial issues facing our Fund.
Why hasnt there been a vote in Congress on the Butch Lewis Act?
The Butch Lewis Act has been introduced in both the House and Senate but unfortunately has not attracted broad bipartisan support. The committees of jurisdiction in both chambers have not held any hearings on the bill, and neither chamber has scheduled the bill for a vote.
As part of their budget agreement earlier this year, and recognizing the importance of multiemployer pension fund issue, Congress created a Joint Select Committee on the Solvency of Multiemployer Pension Plans to address the pension crisis. The Joint Select Committee is comprised of four Democrats and four Republicans each from both the House and Senate. If a bipartisan group of members on the Committee can agree on a solution, the Joint Select Committee will propose legislation, which will then be considered by the House and Senate. Sen. Sherrod Brown (D-OH), sponsor of the Butch Lewis Act, serves as Co-Chair of the Joint Select Committee.
Will the Joint Select Committee recommend the Butch Lewis Act to Congress?
Unfortunately we don’t have a crystal ball that can give us that answer. As Sen. Sherrod Brown, sponsor of the Butch Lewis Act, recently stated, "I'd love to end up with Butch Lewis, I think that's the best idea. But I also understand we've got to get five Republican and five Democratic votes."
What can people do to help Congress find a solution?
We believe it is important that all of us involved with the fate of multiemployer pension funds—active and retired participants, beneficiaries, employers, unions, pension rights organizations, and the funds themselves — direct our collective time and energy toward persuading the members of the Joint Select Committee - and other members of Congress - that they must act this year to preserve the retirement security of all those participating in multiemployer plans.
Collectively, we can’t afford to get sidetracked with scenarios that aren’t plausible or are simply a function of partisan politics. Central States will be focused on results and hope others will be similarly motivated.