# Emergency Pension Plan Relief Act of 2021: Plain Language Summary

This bill creates a special rescue program for severely struggling multiemployer pension plans—the kind of pensions that cover workers across multiple companies in industries like construction, trucking, and retail. Think of it as a financial lifeline for pension plans that are running out of money and can't pay retirees what they promised.

The core problem this addresses is real: some pension plans have become so underfunded that they face insolvency, meaning they won't have enough money to pay promised benefits. When this happens, retirees lose their pensions or get drastically reduced payments. The bill allows the federal government's Pension Benefit Guaranty Corporation (PBGC)—the agency that insures pensions—to take over certain pension liabilities from struggling plans. Essentially, the government steps in and assumes responsibility for paying some or all of the promised benefits, funded by taxpayer money. This is different from the current system, where the PBGC has strict limits on what it will pay out.

For retirees and workers, this could mean getting their full pension benefits restored instead of facing cuts. If a plan qualifies for this relief, the government will take on enough of the plan's debt so that the remaining plan can stay solvent for at least 30 years without cutting benefits. The bill also requires plans that had already cut benefits to restore those cuts and pay back the money that was withheld. However, there are eligibility requirements—plans must be in critical condition, have very few active workers compared to retirees, or already have had benefits suspended. The deadline for plans to apply for this relief is December 31, 2026, with a final revision deadline of December 31, 2027.

Emergency Pension Plan Relief Act of 2021

Neal, Richard E.

Emergency Pension Plan Relief Act of 2021 This bill modifies the funding rules and provides financial assistance for certain pension plans that are underfunded or insolvent. First, the bill expands the authority of, and provides funding for, the Pension Benefit Guaranty Corporation (PBGC) to provide special partition assistance to a multiemployer pension plan that is insolvent or at risk of insolvency. The bill expands eligibility for partition assistance, provides funding for a plan to reach a projected funded ratio of 80% over a 30-year period, and does not require a plan to repay such assistance. The bill further permits a multiemployer pension plan to elect to retain its funding zone status from the previous year for either (1) the first plan year beginning during the period from March 1, 2020, through February 28, 2021; or (2) the next succeeding plan year, as designated by the plan sponsor. A plan may also extend by five years the funding improvement or rehabilitation period if the plan is designated as in endangered or critical status for a plan year beginning in 2020 or 2021. A plan in critical and declining status may not suspend payment of plan benefits. Additionally, the bill adjusts the minimum funding standards for a multiemployer pension plan to account for investment losses and other losses related to the COVID-19 pandemic and modifies the PBGC guarantee formula to increase the maximum potential benefits under a multiemployer pension plan. Finally, the bill makes changes with respect to single employer pension plans, including revising the amortization rules and extending and modifying the pension funding stabilization percentages.