2008 Financial Crisis and Subsequent Bankruptcies Have Left Once Secure Pension Funds Facing Significant Shortfalls / The ‘Miners Protection Act’ Ensures The Promise Of Lifetime Health Care And Pensions To Retired Miners And Their Families / Measure Would Transfer Existing Funds, Allow Retirees to Access Early 90’s Benefit Plan to Ensure their Access to Healthcare
Washington, D.C. –Today, U.S. Senator Bob Casey (D-PA) announced that he has backed the newly introduced Miners Protection Act. This legislation would ensure that the federal government and coal operators honor their obligation of lifetime pensions and health benefits to retired miners and their families who are facing uncertainty as a result of the financial crisis and corporate bankruptcies. The legislation was introduced today with U.S. Senators Joe Manchin (D-WV), Shelley Moore Capito (R-WV) and Sherrod Brown (D-OH).
“Miners across Pennsylvania have risked their personal safety to secure a better life for their families and contribute to our nation’s energy portfolio. We can’t let their retirements disappear,” Senator Casey said. “This commonsense, bipartisan legislation would give miners across Pennsylvania the peace of mind in knowing that the retirements they worked all their lives for are secure.”
Retired miners are facing uncertainty because the United Mine Workers of America (UMWA) 1974 Pension Plan is severely underfunded. Unlike other public and private pension plans, the 1974 Pension Plan was well-managed and funded prior to the 2008 financial crisis, which hit at a time when this Plan had its highest payment obligations. This – coupled with the fact that 60% of the beneficiaries are “orphan” retirees whose employers are no longer in the coal business, and the fact that there are only 10,000 active workers for 120,000 retirees – has placed the Plan on the road to insolvency. If the Plan becomes insolvent, these beneficiaries face benefit cuts and the Pension Benefit Guaranty Corporation will assume billions of dollars in liabilities.
To address these issues, the Miners Protection Act would:
- Amend the Surface Mining Control and Reclamation Act to transfer funds in excess of the amounts needed to meet existing obligations under the Abandoned Mine Land (AML) fund to the UMWA 1974 Pension Plan to prevent its insolvency.
- Make certain retirees who lose health care benefits following the bankruptcy or insolvency of his or her employer eligible for the 1993 Benefit Plan. The assets of Voluntary Employee Benefit Association (VEBA) created following the Patriot Coal bankruptcy would be transferred to the 1993 Benefit Plan to reduce transfers from the AML fund.
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