Musicians Union’s Pension Fund Withdraws Plan To Scale back Advantages; Will Apply For Assist Underneath $1.9 Trillion American Rescue Plan As an alternative – .
Trustees of the American Federation of Musician’s Employers Pension Fund have withdrawn their benefit cut requests for nearly half of the 50,000 attendees.
The fund had applied to the Treasury Department for permission to reduce benefits as it was expected to run out of money to pay for benefits within 20 years. The fund entered “critical status” two years ago when its liabilities of $ 3 billion exceeded its assets of $ 1.8 billion, meaning it was underfunded by approximately $ 1.2 billion was.
The change in plans was made possible by the election of President Joe Biden and the $ 1.9 trillion American Rescue Plan Act (ARPA), which he recently signed. After reviewing an actuarial analysis of the pension relief provisions included in the rescue plan, the Trustees decided to withdraw their request for reduction and instead seek financial assistance under the ARPA that, if approved, would allow the Fund to pay benefits for the next 30 years. ARPA provides flat rate grants to qualifying multi-employer pension plans that are non-repayable.
The Musicians Union pension fund is trying again to reduce benefits in order to prevent bankruptcy within 20 years
“The Pension Benefit Guarantee Corporation (PBGC) is tasked with enacting regulations that define how ARPA’s pension relief provisions will be implemented,” the fund told its participants today. “These rules are important because the value of the financial assistance and whether it provides enough cash to pay for benefits through 2051 or beyond depends on how ARPA is interpreted. The trustees intend to advocate arrangements that will serve the purpose of ARPA and allow plans to pay benefits through at least plan year 2051. The PBGC rules also specify when the fund can apply for financial assistance under ARPA. We intend to apply as soon as possible. “
“Your advocacy helped bring about this moment,” the trustees told attendees. “Thank you again to everyone who has heard your voices from your elected officials. In the future, we will continue to share news and information about the status of the PBGC regulatory process, as well as the process and timeline the plan must follow in order to apply for relief under ARPA. For now, we wanted to bring this important and very welcome news to you right away. “