WASHINGTON – Senate Finance Committee Chairman Chuck Grassley (R-Iowa) and Senate Health, Education, Labor and Pensions Committee Chairman Lamar Alexander (R-Tenn.) today introduced the Chris Allen Multiemployer Pension Recapitalization and Reform Act, legislation based on their 2019 proposal to avert the collapse of critically underfunded multiemployer pension plans and reform rules for these plans to prevent future funding shortfalls within these important pillars of the American retirement system. “We believe this legislation would ensure that the PBGC’s multiemployer insurance fund remains solvent over the long-term after the initial rescue of the currently failing plans. But, most importantly, this legislation would reform the system to prevent this from happening again,” Grassley said on the Senate floor. “I’d also note that the bill is named after Chris Allen, who was a dedicated member of my Finance Committee staff who passed away nearly one year ago. Chris poured thousands of hours of work into developing, drafting, and perfecting the Grassley-Alexander plan. I’m grateful for all the work he did, and I’m proud this legislation bears his name.” “This is a balanced proposal to help protect the benefits promised to about 1.5 million retirees by private sector employers and unions,” Alexander said. “Our legislation would shore up the PBGC’s role as an insurance company with a limited infusion of taxpayer dollars instead of an open-ended bailout, and institute important structural reforms so this does not happen again.” The Grassley-Alexander legislation is based on their 2019 proposal and incorporates a year’s worth of improvements and stakeholder feedback. Grassley and Alexander earlier this week said the negotiations had reached the point where there was not enough time remaining for passage in the current Congress. The Grassley-Alexander legislation will serve as a basis for the next Congress to address the growing problem of insolvent multiemployer pension plans. Text of the legislation can be found HERE and a section-by-section of the legislation can be found HERE. Grassley delivered the below remarks following the introduction of the legislation. Prepared Floor Remarks by U.S. Senator Chuck Grassley of Iowa Chairman, Senate Finance Committee Introduction of the Chris Allen Multiemployer Pension Recapitalization and Reform Act Thursday, December 17, 2020 In late June, I came to the floor to speak about the need to fix the failing multiemployer pension system. I spoke about the need to secure retirement benefits for the millions of Americans who will start to see plan failures and benefits cut in the coming years if Congress doesn’t act to fix this problem. For the past two weeks, Chairman Alexander and I were negotiating with our Democratic colleagues to do just that. Those negotiations were constructive, and I believe both sides worked in good faith. While both sides agreed to make significant changes, in the end, we weren’t able to find a compromise that satisfied our respective principles and objectives for resolving this situation. In the midst of year-end appropriations and COVID-relief negotiations, there simply wasn’t enough time to reconcile our differences on how to fix this failing system. My hope had been to use the last eight months to negotiate a solution in a thoughtful and measured manner, instead of in the heat of a complex year-end bill. But sadly, that didn’t happen. From the beginning we have agreed that federal funds will be needed to solve the crisis in the short term. But we have been equally resolute that reforms are essential to ensure the system can be self-sustaining in the long term. Otherwise, taxpayers will be perpetually subsidizing a private-sector system of employee-benefit promises. Last November, Chairman Alexander and I presented our comprehensive approach to rescue and reform the multiemployer pension system, which we have been working on and improving ever since. The product was improved with an amazing amount of input from workers, retirees, unions, employers, actuaries, academics, plan officials, and members of the general public. Today, Chairman Alexander and I will introduce a revised version of that plan – the Chris Allen Multiemployer Pension Recapitalization and Reform Act. This legislation served as the basis for our recent negotiations and is the product of years of work with Chairman Alexander to produce a serious, responsible plan that can provide relief to failing plans and protect retirees’ benefits. It’s also designed to ensure the long-term solvency of Pension Benefit Guaranty Corporation’s (PBGC) multiemployer insurance fund, based on the many comments and proposals we received to the original Grassley-Alexander plan released last November. We believe this legislation would ensure that the PBGC’s multiemployer insurance fund remains solvent over the long-term after the initial rescue of the currently failing plans. But, most importantly, this legislation would reform the system to prevent this from happening again.
I’d also note that the bill is named after Chris Allen, who was a dedicated member of my Finance Committee staff who passed away nearly one year ago. Chris poured thousands of hours of work into developing, drafting, and perfecting the Grassley-Alexander plan. I’m grateful for all the work he did, and I’m proud this legislation bears his name.
I’m also grateful to Andy Banducci, who helped us continue Chris’ work while on detail to the Committee from the PBGC for several months earlier this year. His expertise and commitment, especially during the pandemic, were essential to bringing this legislation to completion.
Let me close by stressing two points for my Democratic colleagues. I appreciate your professional and good-faith efforts to try to find an agreement on this important issue. Although we were not able to reconcile our differences before the clock ran out, we need to carry that work forward, and I remain ready to continue the discussion. These issues are not simple, and as I said in June, delaying a solution is only going to make it more costly.
We should continue to work together to find a solution for the 10 million workers and retirees in multiemployer plans. America’s retirees deserve it.
I yield the floor.