The Pension Benefit Guaranty Corporation approved on Tuesday an application for Special Financial Assistance of $84.9 million to the Teamsters Local Union No. 52 Pension Plan, based in Valley View, Ohio.
The SFA provision of the American Rescue Plan Act allows for PBGC funding for severely underfunded multiemployer pension plans. Funds that receive assistance must monitor the interest resulting from the grant money as separate from other sources of funding. The PBGC also only accepts investment-grade bonds as an investment for the funds it provides.
The pension plan covers 769 participants in the transportation industry. The plan expected to run out of money some time in 2023, after which the pension would be turned over to the PBGC, and participants would have been paid approximately 60% less than what the pension was originally supposed to pay.
Dave Dudas, the secretary treasurer and principal officer for the pension, explained the amount of $84.9 million includes interest that has accrued from the time the application was submitted to the time the money is disbursed.