The Teamsters Local 73 pension plan based in Valley View has been granted substantial funding of $7.5 million from the Pension Benefit Guaranty Corporation (PBGC). Aimed at supporting underfunded pensions, this additional funding is crucial for preventing the plan’s fund from exhausting by 2038.
Without this significant financial aid, Local 73 could have faced substantial cuts in participant benefits. U.S. Democratic Senator Sherrod Brown of Cleveland praised this initiative, deeming it as critical help for struggling multi-employer pension plans.
According to Sen. Brown, approximately 10 million Americans rely on such pension plans. 1.5 million of those are at risk of losing benefits due to their plans’ impending insolvency.
Critical funding safeguards Local 73 pension
Brown emphasized the importance of finding a solution to guarantee continued support for pensioners.
The senator acknowledged the pivotal role of workers, retirees, and small business owners in reaching the pension agreement. The funding will greatly benefit local workers and small businesses, fostering economic growth and promoting market stability in Ohio.
Many multi-employer pension plans have faced financial challenges due to increased retirements, a dwindling workforce, and declining investments. The impact of the COVID-19 pandemic has only exacerbated these difficulties. Senator Brown underlined the need for viable alternatives and policy reforms to preserve the financial stability of these pension plans.
As part of a distressed aid program initiated in 2021, the PBGC has already given nearly $53.9 billion in aid, securing the pensions of around 786,000 workers, retirees, and beneficiaries. During a 2022 visit to Cleveland, President Biden announced nearly $90 billion in aid to the PBGC, marking it a significant win for union workers over the last fifty years.
