PBGC Takes MI Auto Parts Maker's Plans

January 17, 2007 (PLANSPONSOR.com) - The nation's private-sector pension insurer has taken responsibility for the two pension plans of a now-liquidated maker of plastic automobile components.

According to a news release from the Pension Benefit Guaranty Corporation (PBGC), its move affects the pensions of more than 1,100 former employees of Venture Holdings Corp., which is based in Fraser, Michigan. The two Venture plans, known as the “Lancaster Plan” and the “Seabrook Plan”, cover hourly workers.

The PBGC estimated the plans have a combined shortfall of $12.4 million, with total assets of $12.5 million and liabilities of $24.9 million.   The Lancaster Plan terminated on August 31, 2004 and the Seabrook Plan terminated on September 30, 2004. The agency took over as trustee of both plans on December 11, 2006.

According to the announcement, the PBGC stepped in because the plans faced abandonment after the company, in liquidation, sold substantially all assets and no purchaser was willing to assume the pension programs.

Under federal pension law, the maximum guaranteed pension at age 65 for participants in plans that terminated in 2004 is $44,386 per year. The maximum guaranteed amount is lower for those who retire earlier or elect survivor benefits.  In addition, certain early retirement subsidies and benefit increases made within the past five years may not be fully guaranteed.