Congress Likely to Take Up Short-Term Pension Relief Early in 2010:
Despite a rebound in stock prices and a slightly improved economic outlook, the nation’s single and multi-employer pension plans continue to suffer the aftershocks of the recession. A recent study by Mercer Consulting concluded that, over the past year, plans sponsored by S&P 1500 companies are running combined deficits of between $275 billion and $310 billion. Thanks to an extensive lobbying campaign by the business and labor communities (including FMI and a number of its member companies), Congress is well-aware of the problems created by this shortfall and the need for immediate action to provide relief.
During 2009, there were seven Committee hearings on the state of defined benefit pension plans and dozens of bills introduced, including a major relief bill – HR 3936, the Preserve Benefits and Jobs Act of 2009, co-sponsored by Rep. Earl Pomeroy (D-ND) and Rep. Patrick Tiberi (R-OH). Unfortunately, quick action to provide relief was slowed by the healthcare debate.
Congressional leaders, however, have announced plans to move quickly in 2010 to get temporary pension relief in place to help give plans more time to recover from the economic crisis. While the details of a final proposal remain to be decided, it appears likely that any legislation will cover funding requirements for both the 2009 and 2010 plan years, hopefully providing enough time for plans to get back into balance.
