>Under the modification, the plan’s funding requirement will be reduced to 65% from 85% through June 30, 2008. After such time, the funding requirement would then increase in annual 3% increments until it reaches the 85% level, according to Washington-based legal publisher BNA.
However, the PBGC’s approval of the lower funding requirements – requested by the ILWU-PMA in March – is dependant upon the plan’s compliance with enhanced reporting, disclosure, and certification requirements to include:
- providing copies of all actuarial valuation reports, as well as drafts of such reports
- supplying copies of all independent auditor’s reports and financial statements, as well as drafts of such reports
- filing annual actuarial certification with the PBGC no later than 90 days after the close of the plan year, including whether the contributions received by the plan are at least equal to the projected funding percentages included in the approval notice.
>The latest PBGC action modifies an earlier version of special withdrawal liability rules set in 1984 and modified in 1998 that required the plan’s actuary to provide annual certifications that at least 85% of liabilities for vested benefits are covered by plan assets. However, the ILWA-PMA pension plan said benefit increases promised under a 2002 collective bargaining agreement, combined with the declining stock market, likely will cause the plan to fall below the 85% funding requirement, requiring substantial contribution increases that would reduce investment capital. The new bargaining agreement was the resolution to a labor dispute in late 2002 that locked out West Coast dock workers and shut down 29 ports.
The ILWU-PMA plan includes more than 100 contributing employers and more than 10,000 workers that perform longshore work for all oceangoing dry cargo on the West Coast.