House passes bill to rescue Teamsters pension plan

Washington — The Democratic-controlled House late Wednesday approved a bill to help an estimated 45,000 current and retired Teamsters union members in Michigan avoid pension cuts related to the distressed Central States Pension Plan.

Financial problems have left the plan severely underfunded and could force cuts in payments to hundreds of thousands of retirees nationwide who paid into the system over their careers.

Lead sponsors, including Democratic Rep. Debbie Dingell of Dearborn, said the legislation would shore up Central States and other qualifying multiemployer pension plans in danger of insolvency.

"For too long, these hard-working men and women have lived in fear, not knowing what’s going to happen. They've given up pay raises, they played by the rules, they thought they would have a safe and secure retirement," Dingell said during debate. 

"By passing the Butch Lewis Act, we are sending a loud message that we hear them and are taking steps to ensure that their retirement that they work for for a lifetime will be there when they need it."

Republican leaders said the bill was fiscally irresponsible and that the poor financial situation of multiemployer pension plans is the result of "union and employer negligence," as California Rep. Virginia Foxx argued Wednesday. 

"For the first time ever, taxpayers will prop up failing, mismanaged union-run pension plans," Foxx said during debate. "We're giving failed union pensions a blank check. What a deal." 

The bill did receive bipartisan support from Michigan members, with Republican Reps. Bill Huizenga of Zeeland, Tim Walberg of Tipton and Jack Bergman of Watersmeet among 29 GOP House members who voted yes. The vote was 264-169.

Walberg, the top Republican on the Education and Labor subcommittee that handled the bill, voted yes despite arguing the legislation is a "bailout" missing the structural reforms needed to prevent a similar situation from arising again. 

Walberg recalled talking to rooms full of Teamsters "who are in agony over this." 

"I realize there's many retirees in a world of hurt," he said. "I want to convince my colleagues in Congress that we can't let this go. We can't turn our heads."  

Huizenga agreed, saying that failing to act would jeopardize hard-earned pensions for thousands of Michiganians and over a million Americans.

"While the bill isn’t perfect, it takes important steps to support middle class families who played by the rules and planned for their retirement," Huizenga said in a statement. 

"The Senate product will likely look very different, and we will have to reach a bipartisan, bicameral solution."

The Rehabilitation for Multiemployer Pensions Act would create an office in the Treasury Department and a related trust fund to issue loans to certain distressed or insolvent multiemployer defined benefit pension plans so they can continue to provide benefits for retirees and workers.

Foxx said that, under the bill, all 160 multi-employer plans could apply for a government loan at no limit, and the loans would be forgiven if unable to be repaid after 29 years. 

"Taxpayers are on the hook for a lot of things right now with respect to pensions," said Rep. John Moolenaar, R-Midland, who voted against the bill. 

"Taking an additional taxpayer responsibility for private pensions sets a precedent that could lead us into different areas with different states and different other entities, and the federal government can't sustain that kind of support."

Democrats said the legislation isn't a bailout but a "backstop," as freshman Rep. Haley Stevens argued in a fiery floor speech Wednesday.  

"The ringing irony is that the very people opposing this bill are some of the very people who rush to vote to pass a tax relief act for the wealthiest corporations and the biggest banks, ballooning our deficit by $1.9 trillion," said Stevens, D-Rochester Hills.

"We scratch our heads, and we ask why is it that you cannot lift a finger for the middle class?"

mburke@detroitnews.com