On December 30, the Trustees submitted an application to reduce benefits under the Multiemployer Pension Reform Act (MPRA). This began a long and complex approval process that will take place throughout much of 2020. If approved, the benefit reductions will go into effect on January 1, 2021.
See below for a timeline of key points in the MPRA process. Please note that some of the anticipated points in the timeline depend on when Treasury takes certain actions. MPRA gives Treasury specific periods of time in which to take these actions (review the MPRA application, mail voting ballots to participants, etc.).
Additionally, it is possible that Treasury may identify changes that need to be made in the MPRA application before it can be approved. In this case, the Plan may withdraw the application and resubmit it, which would restart the timeline. This has occurred for many other pension funds that ultimately have had successful MPRA applications. To reduce the likelihood of this scenario, we have had numerous communications with Treasury about its expectations.
January 6, 2020: Participants sent notice, including an estimate of the proposed benefit reduction
On January 6, 2020, the Plan mailed a notice to each of our 50,000 participants and beneficiaries of deceased participants. This notice included a personalized benefit statement with participants' current benefit and estimated reduced benefit.
January 17, 2020: Treasury posted application and opened public comment period
Treasury posted the application on its website on January 17, 2020.
August 11, 2020 (anticipated): Treasury completes review of MPRA application; approves or denies it
- Click here to view the application.
- Click here for instructions on how to submit a public comment on the application. On March 19, 2020, Treasury reopened the comment period through Monday, April 20.
Treasury has up to 225 days to review the Plan's application and approve or deny it. For a pension fund as large and complex as the AFM-EPF, we expect that Treasury will take all or nearly all of this 225-day period for review.
September 2020 (anticipated): Participant vote begins
If the MPRA application is approved, Treasury will mail ballots to all participants and beneficiaries of deceased participants within 30 days of the approval. Voters will indicate if they approve or reject the proposed benefit reductions and then mail their ballots back to Treasury. The deadline to return ballots must be at least 21 days after the date that Treasury mailed ballots to voters.
October 2020 (anticipated): Treasury announces outcome of participant vote
Treasury must announce the outcome of the vote within seven days of the voting deadline. For a plan of benefit reductions to be voted down, a majority of eligible voters must vote against it. So, unreturned ballots are effectively counted as votes to approve the benefit reductions.
Treasury will post the results of the vote on its website, including the number of people who voted in favor of the reductions, the number who voted against them and the number of unreturned ballots.
January 1, 2021: Benefit reductions go into effect
If the participant vote approves our MPRA application, Treasury will give final authorization for the Plan to implement the benefit reductions. The Trustees expect to implement benefit reductions effective January 1, 2021.