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Michigan lawmakers and hundreds of businesses, workers, and retirees urged Congress to fix the multiemployer pension funding crisis during a July 20 union meeting in Detroit.
The listening session was the latest in a series of Teamsters-sponsored, nationwide town halls and rallies on a pension system overhaul. It followed a rally in Ohio before a July 13 hearing of the bipartisan Joint Select Committee on Solvency of Multiemployer Pension Plans about ailing pensions and the growing funding deficits. Multiemployer plans are collectively bargained between unions and employers in the same industry, such as trucking or construction.
Many retirees and current workers who spoke at the Detroit meeting were angry that their pensions had been cut by, in some cases, 50 percent to 72 percent, and expressed their frustrations and concerns over pension funding to Teamsters President James Hoffa, Rep. Debbie Dingell (D-Mich.), House Minority Leader Nancy Pelosi (D-Calif.), and other lawmakers.
John Fuller, a member of a machinist union local that suffered significant pension cuts, begged Congress for help.
“I made several life choices as a young man to get this pension,” he said. “As of Jan. 1, my pension was cut by 72 percent.”
He said, “Our fund is going to run out and we understand that, that’s why we need the help. I took a cut and they say that’s still not going to help. I’m seven months” into the pension cut, “and it really hurts, so we need the help right now.”
The Teamsters says the growing deficit could impact more than 300 retirement plans, including the Central States Pension Fund, which sponsors the largest number of participants—nearly 44,000 workers in Michigan.
Central States is slated to run out of money for current and future retirees by 2025. The joint select committee has until the end of November to propose legislation to fix the multiemployer pension system. The nation’s pension insurer, the Pension Benefit Guaranty Corporation, projects its program covering those plans will be insolvent by 2025.
Workers are worried about an increase in prescription costs, in addition to pension cuts, and support any legislation addressing cuts.
Pam Powell, an active worker in Michigan and cancer survivor, said she worries about how her medicine will be covered.
“When I stand in that prescription line, behind my seniors, and I get my $6 or $10 prescription and their bill is like $1,000. They may only have one prescription and I may have a whole bag, I feel so bad for them, but then I look at it like, ‘I’m getting ready to be one of them. Who’s going to pay for my prescriptions?’,” Powell said. “I’ll partner with you” because “we need our pensions and we need some security and I thank you that you fight for us, but this shouldn’t be a partisan issue.”
The Butch Lewis Act (H.R. 4444), which was co-sponsored by Dingell in November 2017, promises that multiemployer pension plans will stay solvent and retiree benefits won’t be impacted. The measure, however, hasn’t moved past House appropriations panels.
“This is a town hall to allow my colleagues to hear from the working men and women that have expressed their concerns to me about many issues including their pensions,” Dingell told Bloomberg Law July 19. “The potential pension cuts will have devastating effects on the working men and women in Michigan.”
The Teamsters and the Central States Fund are among several groups supporting the Butch Lewis Act, and they agree that without congressional action, beneficiaries will see significant reductions.
“The bottom line is that many retirees, through no fault of their own, find their pensions in peril,” UAW President Gary Jones told Bloomberg Law. “Pensioners in over 300 retirement plans across the country are looking to Congress to put aside differences and help solve this crisis.”
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