Washington — A bill introduced by Democrats in Congress on Thursday aims to help more than 30,000 Michigan current and retired Teamsters union members avoid pension cuts related to the distressed Central State Pension Plan.
Financial problems have left the pension plan severely underfunded and could force cuts in pension payments to hundreds of thousands of retirees nationwide.
Sponsors of the bill, including Reps. Debbie Dingell of Dearborn and Dan Kildee of Flint Township, say the legislation would shore up the Central States Pension Fund and 200 other multiemployer pension plans in danger of insolvency in the next 10 years.
The Rehabilitation for Multiemployer Pensions Act would create a new office in the U.S. Treasury Department to issue bonds to finance loans to distressed pension plans, allowing them to remain solvent and continue to provide benefits for retirees and workers.
“The No. 1 thing is there would be no cuts for workers,” Dingell said in an interview. “They put their money in for a lifetime. Can you imagine what it’s like to work a lifetime, live by the rules, get to your 70s and suddenly have no retirement security?”
Dingell said she hopes to convince some Republican colleagues to sign onto the bill, increasing its chances of getting a vote on the House floor.
Last year, the Treasury Department rejected a Central State Pension Plan proposal that would have cut retiree benefits by as much as 70 percent, affecting an estimated 273,000 retirees.
Treasury rejected the proposal based on a review by outside attorney Kenneth Feinberg, a victim compensation expert, who concluded the plan didn’t demonstrate how the reductions would keep the pension plan from becoming insolvent or show they were being equitably distributed.
The lead sponsors of the legislation are Democratic Rep. Richard Neal of Massachusetts and Sen. Sherrod Brown of Ohio.