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Pension Benefit Guaranty Corporation:  PBGC is a federal corporation created by the Employee Retirement Income Security Act of 1974. It currently protects the pensions of 44.1 million American workers and retirees in 30,330 private single-employer and multiemployer defined benefit pension plans. PBGC receives no funds from general tax revenues. Operations are financed by insurance premiums set by Congress and paid by sponsors of defined benefit plans, investment income, assets from pension plans trusteed by PBGC, and recoveries from the companies formerly responsible for the plans.

Other

American Benefit Council:  The American Benefits Council (the Council) is recognized as the preeminent advocate of employer-sponsored benefit programs in Washington, D.C.

Employee Benefit Research Institute:  EBRI is the only accepted neutral authority promoting the understanding and furtherance of employee benefits national policy. It is not organized as a lobbying organization.

Free ERISA:  Free ERISA is intended as a useful, website where visitors may view retirement and welfare benefit information on the group or groups of their choice as this data appears on Form 5500 for free

A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

( Symbol Guide )

 [ A ]

A Pension Rule, Sometimes Murky, Is Under Pressure, Mary Williams Walsh, The New York Times, November 8, 2005.  “Herb Zydney, who retired as an AT&T executive in 1996, is worried about his pension. Switched into Lucent Technologies' retirement plan during its spinoff from AT&T, he complains that Lucent has invested in "a bunch of risky stuff," in part because of an accounting provision that gives it a financial incentive to do so.  Lucent has already been through one wrenching financial crisis, in the early 2000's, and should its pension plan fail, Mr. Zydney would lose a big part of his benefit. "But I'm almost more concerned as an investor than I am as a retiree," added Mr. Zydney, 72, who owns Lucent stock in a self-directed individual retirement account." (Pensions (Accounting) | Lucent)  Seminar

A Plan To Recalculate Pensions, Mary William Walsh, The New York Times, April 11, 2003.  “Corporations would find billions of dollars of pension shortfalls eliminated overnight under a proposal being prepared to address a longstanding issue in pension accounting..”  (Pensions (Assumptions))

A System Going Under?:  Projected Pension Shortfalls Turn Focus to Reform, Albert B. Crenshaw, The Washington Post, October 19, 2003.  “During his 35-plus working years at Bethlehem Steel in Baltimore, Melvin Schmeizer endured blazing heat and freezing cold, layoffs and odd shifts. But by volunteering for tough jobs and overtime, he boosted his income and, ultimately, his pension, to $2,850 a month when he retired in 2001.  But Schmeizer's retirement plans were knocked out cold last year, when Bethlehem went into bankruptcy and the Pension Benefit Guaranty Corp. (PBGC), the government pension insurance arm, took over the company's pension plans. And while that means Schmeizer's pension will not vanish, it will be cut to $1,700 a month.  Schmeizer, 56, observed wryly to a Senate committee last week that company and union officials had assured Bethlehem workers that "the sky would have to fall" for them not to get their full pensions.” (Pensions | Bethlehem Steel)

After Pension-Fund Debacle, San Diego Is Mired in Probes, Deborah Solomon, The Wall Street Journal, October 10, 2005.  “In January 2004, this city announced that its pension fund was facing a $1.1 billion deficit and its accounts were riddled with errors. Following the example of companies facing similar problems, San Diego launched an investigation and hired an auditor to scrub its books.  Nearly two years later, the city is mired in a series of probes that have each taken on a life of their own. Dueling over the city's finances are the San Diego district attorney, the city attorney, three law firms, a Big Four accounting firm and a three-member audit committee led by Arthur Levitt, the former chairman of the Securities and Exchange Commission. The city attorney has taken to cross-examining audit-committee members at public hearings. Mr. Levitt says the official is making matters worse with his "sneering commentary."  (Pensions (San Diego))

An Outsider's Grim Prognosis for Pension Agency, Mary Williams Walsh, The New York Times, September 14, 2004.  “Remember how bitterly most mutual fund companies - especially Fidelity and Vanguard - fought the Securities and Exchange Commission idea to make them disclose how they voted on board elections, executive pay and other corporate governance issues? Now that rule is in force, and investors can see for themselves why some funds were reluctant to let the sun shine in.  While the money that fund managers oversee belongs to their clients, most managers kept their clients in the dark on proxy votes over the years. Those votes were important, of course, because they represented an immensely powerful tool for change at companies run by me-first executives.” (Pensions (Assumptions))

As Workers Face Pension Cuts, Executives Get Rescued, Theo Francis and Ellen E. Schultz, The Wall Street Journal, April 3, 2003.  "These aren't the types of executive trusts that came into the spotlight when Enron Corp. went over a cliff. Enron, like many companies, had set up "rabbi" trusts to fund deferred-compensation benefits for top executives. Such trusts are technically still company property, and therefore subject to the claims of creditors.  Rather, these less-well-known trusts set up by Delta and others involve arrangements by which the company actually turns the money over to the executives, or to special trusts set up in their names. Once paid out, the money is gone, unavailable to the company in the event of bankruptcy or insolvency."  (Pensions | Executive Compensation)

 [ B ]

Benefits: I'll Have What He's Having, Carol Hymowitz, The Wall Street Journal, May 20, 2003.  “More than wages and even job security, the big battle now between executives and employees is over benefits.  Employees feel increasingly vulnerable as companies pare or eliminate their two most valuable benefits -- medical insurance and retirement accounts -- at the same time their savings have shriveled and their salaries have frozen or fallen.  As health-care costs soar, companies are boosting worker payroll contributions to insurance premiums and co-payments to doctors, hospitals and pharmacies, just as coverage for medical procedures and drugs is shrinking. Only 43% of 434 large companies recently surveyed by Watson Wyatt Worldwide say they are "very confident" they will still offer health-care benefits 10 years from now. Many younger large employers such as Wal-Mart Stores Inc. don't give health benefits to retirees, while those that traditionally have are dropping those policies for new hires.”  (Pensions | Executive Compensation | Health and Retirement Planning)

Bethlehem Seeks to End Retiree Benefits, The Associate Press, The New York Times, February 7, 2003.  "Bethlehem Steel announced Friday that it would seek elimination of health and life insurance benefits for about 95,000 retired workers and their dependents, telling the bankruptcy court overseeing its reorganization that it can no longer afford it."   (Pensions |  Bethlehem Steel)

Beware the Pension Monster: It Lurks Behind Funny Accounting, Ready To Pounce On Unsuspecting Investors., Janice Revell, Fortune, March 3, 2002.  "Like the unseen menace that stalked Elm Street, the pension monster has been hidden in the shadows. Now it's stepping out into the light. And is it ever one mammoth ugly creature: Big corporate pension plans in America owe some $1.2 trillion to their current and future retirees, and for the first time in years companies don't have enough money stashed away to pay for those benefits. The size of the current shortfall? $240 billion. To put that in perspective, that's more than half of what they're expected to earn this year."  (Pensions)  A Fortune Follow-up:  Is Your Retirement At Risk  Seminar

Big Stakes in Ailing Airlines Raise Questions for U.S. Pension Agency, Michael Schroeder, The Wall Street Journal, November 3, 2005.  “The U.S. government is on its way to becoming a big shareholder in the nation's airline industry and possibly in the auto industry.  The Pension Benefit Guarantee Corp., the federal agency that partially guarantees traditional pensions, recently was awarded 7% of US Airways Group Inc. by a federal bankruptcy court handling the company's Chapter 11 reorganization, according to the PBGC's recent filing with the Securities and Exchange Commission. The agency got the shares as compensation for the underfunded pension plans it assumed when the company filed for bankruptcy."  (Pensions | US Airways Group)

'Broken' Pension System In 'Crying Need' Of A Fix, Marilyn Adams, USA Today October 10, 2005.  “Most surviving American steelmakers long ago abandoned costly pensions plans. But AK Steel still covers most of its 7,500 workers with a plan that pays retirees a monthly benefit based on tenure and past wages — a coveted defined-benefit plan."  (Pensions | AK Steel)

Bye-Bye Pensions: Soon Hundreds Of Corporations May Slash Pensions By As Much As Half, Janice Revell, Fortune, March 3, 2002.  "We'll go a step further: Brace yourself for a very un-fairy-tale ending to this story. Millions of American workers are sure to see a large slice of their retirement income go up in smoke. It may not happen right away, but the groundwork is being laid right now. Of course, people have been saying for years (including people at this magazine) that economic necessity--the chasm between the cost of promises made and companies' ability to keep them--leaves management no choice but to reformulate, rethink, and in some cases renege on post employment benefits for their workers. What's new in the past few months is that they're quietly taking action. The profoundest benefit cuts will happen perhaps a decade or more from now--but you may as well add them to your retirement worry list, alongside those limp 401(k)s, rocketing health-care costs, and underwater stock options."  (Pensions)

 [ C ]

  Companies Sue Union Retirees To Cut Promised Health Benefits, Ellen E. Schultz, The Wall Street Journal, November 10, 2004.  “Many companies have already cut back company-paid health-care coverage for retirees from their salaried staffs. But until recently, employers generally were barred from touching unionized retirees' benefits because they are spelled out in labor contracts. Now, some are taking aggressive steps to pare those benefits as well, including going to court.  In the past two years, employers have sued union retirees across the country. In the suits, they ask judges to rule that no matter what labor contracts say, they have a right to change the benefits. Some companies also argue that contract references to "lifetime" coverage don't mean the lifetime of the retirees, but the life of the labor contract. Since the contracts expired many years ago, the promises, they say, have expired too.” (Pensions | Company Healthcare Benefits)  Plaintiff Cry: When Retirees Sue an Ex-Employer

Companies Use Cash for Growth, Cassell Bryan-Lou, The Wall Street Journal, April 18, 2003.  “Because returns on assets are factored into net income, another concern for investors is that corporate earnings can suffer. Because accounting rules attempt to smooth short-term earnings fluctuations, analysts warn the impact of declining markets has yet to be fully felt. Many companies are still factoring in gains from the bull market of 1990s; CSFB identified nearly 100 companies that last year reported pension income, including 17 for which it constituted 15% or more of 2002 net income. Accounting rules allow companies to claim the pension-fund investment returns as net income even though pension assets belong to pensioners, not stockholders.”  (Pensions)

Concerns Raised Over Consultants to Pension Funds, Mary Williams Walsh, The New York Times, March 21, 2004.  “A small but growing part of the $2 trillion in state and local pension funds is being steered into high-risk investments by pension consultants and others who often have business dealings with the very money managers they recommend. After making such investments, a few of these pension funds have come up short, forcing the governments to draw on tax dollars.  The Securities and Exchange Commission is so concerned that it has begun an inquiry into the practices of pension consultants, who serve as gatekeepers for thousands of money managers.  The regulators will find not just financial consultants but a web of intermediaries — marketing agents, lobbyists, brokers and world leaders — between pension funds and the investments they choose."  (Pensions (Local and State) | Conflicts of Interest (Financial Firms and Government Officials))

Cronyism at Calpers, The Wall Street Journal (Opinion), January 31, 2003.  “How have the mighty fallen. And how quickly. For decades, Calpers, the giant California state pension fund, set a standard of excellence in investment performance and probity. Lately, however, Calpers has become the poster-plan for bad performance, cronyism and lousy corporate governance. And it's about to get worse.” (Pensions (Local and State (California)) | Conflicts of Interest (Financial Firms and Government Officials))

 [ D ]

Defending a Colossal Flop, in His Own Way, Andrew Ross Sorkin, The New York Times, June 6, 2004.  "Sitting on the witness stand in a tiny courtroom in northern Connecticut last week, Theodore J. Forstmann looked every bit the Wall Street Master of the Universe that he is. He just didn't sound like one.  "What is a junk bond?" a lawyer inquired.  "You're really asking the wrong person," Mr. Forstmann replied.  Indeed, the usually loquacious Mr. Forstmann, who made billions of dollars for investors by betting on buyouts like Gulfstream Aerospace, Dr Pepper and General Instrument in the 1980's and 90's, appeared visibly frustrated and at times incapable of answering the most basic questions about his business.  "Frankly, this is kind of over my head," he told the courtroom at one point, when asked a question related to the structure of one of his deals.  "I cannot answer that to your satisfaction," he responded to another question, wearing a pained look on his face. "Can I get some water?"  (Pensions | Conflicts of Interest ("Professional" Money Managers))

 [ E ]

End of Pensions, Roger Lowenstein, The New York Times (Magazine), October 30, 2005.  “When I caught up with Robert S. Miller, the chief executive of Delphi Corporation, last summer, he was still pitching the fantasy that his company, a huge auto-parts maker, would be able to cut a deal with its workers and avoid filing for bankruptcy protection. But he acknowledged that Delphi faced one perhaps insuperable hurdle - not the current conditions in the auto business so much as the legacy of the pension promises that Delphi committed to many decades ago, when it was part of General Motors. This was the same fear that had obsessed Alfred P. Sloan Jr., the storied president of G.M., who warned way back in the 1940's that pensions and like benefits would be "extravagant beyond reason." (Pensions)

Executives Get Pension Security While Plans for Workers Falter, Scott McCartney, The Wall Street Journal, April 17, 2003.  "A number of large companies are setting aside millions of dollars to protect pensions of top executives, even as they forgo contributions to financially strained pension plans for other workers.  The issue of inequity in pension plans is heating up in the airline industry..."  (Pensions | Executive Compensation)

 [ F ]

Failed Pensions: A Painful Lesson in Assumptions, Mary Williams Walsh, The New York Times, November 12, 2003. “Robert M. Bowden retired from his job as accounts manager for a large trucking company with a plan to travel for himself.  But his company's pension plan collapsed this year, and his annual payout was cut to $24,000 from $48,000.  Mr. Bowden and other retirees of the company, CNF, see a culprit. In a lawsuit, they accuse the company of failing for many years to set aside enough money in the plan. The company did this, they say, by assuming they would retire much later than they really did. Though the CNF plan offered full benefits to people as young as 55, the company projected people would stick to their desks until they turned 64.  A look at documents made public in the retirees' fight at CNF and at a few other companies, including US Airways and Bethlehem Steel, shows that companies have great leeway to tweak certain crucial assumptions about the future — when their workers will retire, how long they will live, and which way interest rates will move, among others.” (Pensions | Retirement Planning)

Fiction of Pension Accounting, Floyd Norris, The New York Times, December 7, 2001.  “Here’s one explanation for the rising stock market as 2001 nears an end: Some companies are locking in profits for next year by buying stocks this year.  If that sounds ridiculous, it is.”  (Pensions)

For Pension Plans, Risky Is Fine:  Accounting Rules Let Companies Benefit From Investment Upside, Escape Consequences of Mistakes, Ellen E. Schultz and Theo Francis, The New York Times, December 10, 2003.  ”Pine trees in a pension plan?  In the past decade, many employers have quietly taken on more risk in pension plans -- loading up on stocks, their own securities and nontraditional and illiquid investments -- thanks to accounting rules for pensions that enable employers to capture all of the investment upside, while postponing losses and shifting the consequences of poor investment results to their workers and retirees.  Consider U.S. Steel Corp. The Pittsburgh steel maker has asked the Labor Department for permission to contribute timber rights on two parcels of Alabama land to its underfunded pension plans, in lieu of cash. The seedlings won't be turned into furniture or pulp anytime soon, but the company says the investment has "long-term growth potential."  (Pensions)  Seminar

 [ G ]

GM and a U.S. Agency See Pensions in Different Lights, Mary Williams Walsh and Danny Hakim , The New York Times, October 3, 2005.  “The federal government contends that General Motors' pension fund is $31 billion short of what it owes its work force, according to closely held government data, a figure in stark contrast to G.M.'s assurances that its pension plans are "fully funded."  The government's finding of a huge imbalance suggests that the pension fund may have much larger claims on the company than G.M.'s financial filings have indicated. It was calculated by the Pension Benefit Guaranty Corporation, the federal agency whose job it is to insure employee pensions if a company fails to meet its obligations." (Pensions (GM))  Seminar

GM's Liabilities For Retiree Health Are Over $60 Billion, Lee Hawkins Jr., The Wall Street Journal, March 11, 2004. “General Motors Corp., the nation's largest private purchaser of health care, will soon report that its future health-care liabilities for retirees have surpassed $60 billion -- even after recent Medicare legislation that has reduced retiree health-care obligations for many companies.” (Pensions)  Seminar

GM Others Boost Their Earnings By Pouring Billions Into Pensions, Ellen E Schultz and Theo Francis, The Wall Street Journal, December 4, 2003. “For all the wailing about how the so-called pension crisis might force many employers to put money into their pension plans, there may, in fact, be no better investment for most companies. And many of them are taking advantage of it.  Companies have pumped billions of dollars into their pension plans this year, even though most haven't been required to contribute a dime. Rather, by contributing to their pension plans, companies are assured of a guaranteed, effective return that can exceed 40% in the first year, thanks to an interplay of tax and accounting rules.  Consider General Motors Corp. Wednesday, GM shares shot up more than 5% after a Goldman Sachs analyst drew attention to the good performance of the auto maker's pension plan. But while the stock-market recovery may have helped GM's pension plan, that isn't the entire story.” (Pensions | Use of Pensions (Assumptions) to Boost Earnings)

GM Tops List as Study Questions Pension Accounting, Mary Williams Walsh, The New York Times, June 30, 2005.  “General Motors has the nation's biggest corporate pension fund. And the accounting for that fund may represent the biggest illusion among American corporations.  It is no secret that pension accounting is a hall of mirrors that distorts the appearance of both pension plans and the companies that sponsor them. But a new analysis of the 500 largest American companies finds that pension accounting allows nearly all of them with pension funds to inflate their net worth.  The biggest discrepancy is at G.M.; if the company's balance sheet were adjusted to portray the full magnitude of its pension assets and obligations, the analysis found, its net worth would fall by about $38 billion - wiping out shareholders' equity." (Pensions)

 [ H ]

House Considers Measure to Cut Billions in Pension Obligations, Mary Williams Walsh, The New York Times, May 6, 2003.  “A bill pending in the House of Representatives would allow businesses with union workers to reduce their company pension obligations by billions of dollars, because statistics show that most blue-collar workers do not live as long as other Americans.  The provision, which has gone largely unnoticed in a broad pension bill, is being supported by the United Auto Workers and manufacturing companies whose pension funds now have assets far short of what they are projected to need under previous assumptions about worker longevity.”  (Pensions | Workers and Manufacturing Business Use of Actuarial) Seminar

How Consultants Can Retire on Your Pension, Gretchen Morgenson and Mary Williams Walsh, The New York Times, December 12, 2004.  “Nine years ago, William Keith Phillips, a top stockbroker at Paine Webber, met with the trustees of the Chattanooga Pension Fund in Tennessee to pitch his services as a consultant. He gave them an intriguing, if unusual, choice. They could pay for his investment advice directly, as pension funds often do, or they could save money by agreeing to allocate a portion of its trading commissions to cover his fees. Under a commission arrangement, Mr. Phillips told the trustees, the fund would be less likely to incur out-of-pocket expenses, leaving more money to invest for its 1,600 beneficiaries.  Seven and a half years later, Chattanooga's pension trustees discovered just how expensive that money-saving plan had been. According to an arbitration proceeding they filed against Mr. Phillips, the agreement cost the fund $20 million in losses, undisclosed commissions and fees. And since 2001, Chattanooga has had to raise nearly $3.7 million from taxpayers to keep the $180 million fund fiscally sound."  (Pensions | Conflicts of Interest)

How Wall Street Wrecked United's Pension, Mary Williams Walsh, The New York Times, July 31, 2005.  “Had anyone listened to Doug Wilsman, tens of thousands of United Airlines employees would not be facing big cuts in their pensions. And the federal agency that guarantees pensions might not be struggling with its biggest losses ever.  So who is Doug Wilsman? He is a retired pilot and a former fiduciary of United's pension plan for pilots, and in 1987 he discovered that the company had abandoned its older, tried-and-true approach of investing retirees' money in bonds timed to pay when the pensions came due. Instead, it had bought into the promises of Wall Street that it could put less money into the plan - and take out more later - if it just put most of the assets into the stock market." (Pensions | Conflict of Interest (Wall Street) | United Airlines)  (Seminar)

 [ I ]

It's Time to Move Pension Reporting Out of the Dark, Gretchen Morgenson, The New York Times, November 11, 2002. “During the wonderful bull market, companies took to prettying up earnings with gains generated in pension plans. Investors played along with the fantasy, even though the gains did not belong to the companies but to their pensioners.  With stocks in decline for the last two and a half years, however, pension plans can no longer rescue corporate profits. Losses in these accounts have led to what look like severely underfunded pensions at companies like Delta Air Lines, General Motors and Goodyear Tire and Rubber.”  (Pensions)

 [ J ]

 [ K ]

 [ L ]

 [ M ]

Major Changes Raise Concerns on Pension Bill, Mary Williams Walsh, The New York Times, March 19, 2006.  “With a strong directive from the Bush administration, Congress set out more than a year ago to fashion legislation that would protect America's private pension system, tightening the rules to make sure companies set aside enough money to make good on their promises to employees.  Then the political horse-trading began, with lawmakers, companies and lobbyists, representing everything from big Wall Street firms to tiny rural electric cooperatives, weighing in on the particulars of the Bush administration's blueprint.”  (Pensions)

Many Corporate Pension Funds Assumed Outsize Gains, Mary Williams Walsh, The New York Times, April 18, 2003.  “Noting that the average rate used by the 100 companies was 8.92 percent, on that basis the pension funds gave those companies a collective income increase of $3.3 billion. Had the companies used an average rate of 7.92 percent instead, he said, they would have wiped out that increase and reduced their collective pretax earnings by a further $5.7 billion.”  (Pensions (Assumptions))

Most Workers Are in Dark On Health of Their Pension, Ellen M. Schulz and Theo Francis, The Wall Street Journal, July 1, 2003.  “For millions of American workers, few retirement issues are more vital than the health of their pension plans. But companies have waged a successful battle to keep crucial information about their plans a secret.  The fight comes amid rising alarm about the fate of pensions. Some employers, notably steelmakers, have killed decades-old pension plans. Many other companies have reduced pension benefits by restructuring their plans. And employers are now lobbying Congress for formula changes that would let them make smaller pension contributions and smaller payouts when people retire."  (Pensions | Pension Benefit Guaranty Corporation | Retirement Planning)

 [ N ]

 [ O ]

 [ P ]

Pay Me Later?, Jacqueline Doherty, Barron’s, October 21, 2002.  “An increase in underfunded pension plans could pose trouble for companies and shareholders.  Last week investors were rudely awakened to the troubles that underfunded pension plans could pose for corporate America. With the stock market down and pension-fund assets shrinking, companies ranging from Continental Airlines to Avon Products to New York Times indicated they had made, or planned to make fresh contributions to bolster the value of their pension plans.”  Something Not Working, “U.S. companies may have been shy about their pension woes, but the issue is hardly retiring. In a recent report Credit Suisse First Boston analyst David Zion estimated that the defined-benefit pension plans of the companies listed below are underfunded by at least 25% of the companies' market values. These liabilities do not have to be paid in their entirety this year, thanks to pension rules. But if the stock market does not rebound and interest rates don't rise, companies ultimately will have to fund their obligations, potentially draining cash flow, decreasing reported earnings and harming their balance sheets.”  (Pensions (Accounting))

Pension Accounting Turns $31 Billion of Losses Into Earnings, David Evans, Bloomberg Online, March 24, 2003.  "Nine of the largest U.S. companies obscured $30.61 billion in pension-fund losses in 2002 because of an accounting rule, boosting corporate earnings and prompting calls for a change in regulations."  (Pensions (Accounting and Assumptions))

Pension Agency Warns Against Corporate Relief, John D. Mckinnon, The Wall Street Journal, November 12, 2003. “As supporters searched for a way to make a bailout more palatable, the federal agency that backstops corporate retirement plans warned Congress against proposals to give airlines and other struggling companies a temporary, but significant, break in pension-funding requirements.  Even companies with relatively healthy retirement plans are facing higher contribution requirements because low interest rates and other economic factors are making their long-term pension obligations look larger under federal funding rules. In response, Congress is likely to pass a broad relief measure, in the form of a more generous interest-rate formula for figuring basic contribution requirements.” (Pensions | Retirement Planning | Healthy Companies Future Premium Outlook)

Pensions Face Huge Asset Gap, Albert B. Crenshaw, The Washington Post, June 18, 2004.  "More than 1,000 large private pension plans, many in the airline and steel industries, were underfunded by an aggregate of $278.6 billion at the end of last year, the government's pension insurance agency said yesterday.  The figures are actually a slight improvement over the situation at the end of 2002, when underfunding stood at $305.9 billion. But they stand in sharp contrast to 1999, when 166 plans were underfunded by a total of $18.4 billion.  The underfunded plans had $641.8 billion in assets to cover $920.3 billion in liabilities, for an average funded ratio of less than 70 percent."  (Pension Under-funding (2003))

Pension Failures Foil 6-Figure Retirements, Too, John Leland, The New York Times, October 5, 2004.  “Tom Paulsen worked for 36 years as a trucking executive, and when he retired two years ago, he thought he had secured a comfortable life. He had a 12-acre farm near Sacramento and a pension of $151,000 a year, his payoff for years of working 70-hour weeks.  Then three months later his company, Consolidated Freightways, filed for bankruptcy and the federal government took over its pension plan. Mr. Paulsen's pension fell to $22,000. To pay his expenses, which include $9,000 for health insurance, he has had to divide up the farm and offer most of it for sale.” (Pensions | Retirement Planning)

Pensions Fall -- Not CEO's Bonus, Jesse Drucker and Theo Francis, The Wall Street Journal, June 18, 2003.  “Companies Shift Compensation Formulas To Preserve Payouts to Their Top Officers - Corporations have been feeling the pinch as ailing pension plans cut into their profits. But several large firms are making sure that one item doesn't suffer: the bonuses paid out to top executives.  For much of the past decade, pensions helped fatten the bottom line at many companies thanks to an accounting quirk, indirectly boosting executive bonuses and incentive compensation, which are typically tied to a company's financial performance.”  (Pensions | Executive Compensation | AKS Steel)

Pension 'Guaranty', Review and Outlook, The Wall Street Journal, June 25, 2003.  “Weary of worrying about Fannie Mae and Freddie Mac? Then how about another troubled, quasi-government agency with an implicit claim on tax dollars -- the Pension Benefit Guaranty Corp. The PBGC is responsible for insuring the pensions of 44 million people. One year ago it had a surplus of $7.7 billion. Today its deficit is $5.4 billion.  The agency's troubles are related to the events that last week caused General Motors to announce a $10 billion bond offering to meet its underfunded pension obligations. But at least GM remains a going concern. The underfunded pensions of the many steel, airline and retail companies that have gone bankrupt have all ended up in the lap of the PBGC."  (Pensions | Pension Benefit Guaranty Corporation | Retirement Planning)

Pension Loopholes Helped United Hide Troubles, Mary William Walsh, The New York Times, June 7, 2005.  “Loopholes in the federal pension law allowed United Airlines to treat its pension fund as solid for years, when in fact it was dangerously weakening, according to a new analysis by the agency that guarantees pensions. That analysis is scheduled to be presented at a Senate Finance Committee hearing today.  A second report, by the comptroller general, found that most companies that operate pension funds are using the same loopholes. Those loopholes give companies ways - all perfectly legal - to make their pension plans look healthier than they really are, reducing the amount of money the companies must contribute." (Pensions | United Airlines)

Pension Plan 'Crisis' May Be False Alarm, Ellen E. Schultz and Anne Marie Squeo, The Wall Street Journal, November 26, 2002.  "Investors have been flinching at bleak disclosures about the failing health of pension plans this fall. But the supposed pension crisis isn't something most shareholders need to be concerned about."  (Pensions (Accounting) | Berkshire Hathawat Expected Pension Return = 6.50%)

Pension Math Proves Elastic in Court Case Over Pilots, Mary Williams Walsh, The New York Times, October 21, 2003.  “U.S. Airways said its pilots' pension plan was terminally ill earlier this year, but now the airline is changing the prognosis, in hopes of saving money.  In February, the airline argued in bankruptcy court that the plan was bleeding it dry and that the only way for the company to survive was to abandon it. The judge agreed, the government took over the plan, and some pilots had their benefits cut.  Now the airline is out of bankruptcy but back in court, arguing that the plan was not so very sick after all. If the airline wins this time, the government will receive a smaller equity stake in the airline. That, in turn, will reduce the amount available for the pilots' pensions, and some pilots will lose out again.” (Pensions (Accounting) | PBGC)

Pension Measure May Increase Government's Burden, Theo Francis and Deborah Solomon, The Wall Street Journal, July 24, 2006.  “Legislation to strengthen the U.S. private pension system, which lawmakers could adopt as soon as this week, could increase the government's burden even as it reduces corporate funding requirements, according a recent analysis by the federal pension agency.  The projections from the Pension Benefit Guaranty Corp. suggest that the pension agency would have to make more pension payments for companies unable to do so themselves over the next decade than it would under current law. They also suggest that companies would have to contribute slightly less to their pension plans as well, leaving them less of a cushion to make payments. Under its estimate, the PBGC could absorb more than $2 billion in additional claims than it would under current law.”  (Pensions)

Pension Reserve: What's Enough?, Mary William Walsh, The New York Times, June 22, 2003.  “Accounting is a dismal science, pension accounting even more so. But it is increasingly important to penetrate the fog today, when companies are using complex and sometimes hidden tactics to change the way they pay for their pension plans. For the roughly one in five workers in the private sector whose employers have established pension plans, those changes could significantly affect the way they live in retirement."  (Pensions (Accounting))

Pension Scheme: Contributions to Underfunded Plans will Actually Boost Some Companies' Future Profits, Cheryl Strauss Einhorn, Barron's, December 9th, 2002.  “When International Business Machines announced last week that it would double this year's planned contribution to its pension fund, to $3 billion, Chief Financial Officer John Joyce emphasized the move wouldn't hurt the computer giant's 2003 earnings. What he didn't mention was that this step to shore up IBM's under-funded pension plan will actually boost the computer giant's bottom line by over a quarter billion dollars next year.”  (Pensions | Use of Pensions (Assumptions) to Boost Earnings)

Political Money Said to Sway Pension Investments, Mary Williams Walsh, The Wall Street Journal, February 10, 2004.  “For more than a decade, a small group of businessmen contributed tens of thousands of dollars to the campaigns of their county commissioners in Luzerne County, a waning coal center in eastern Pennsylvania. The elected officials gave the businessmen control over the county pension fund, about $200 million at its peak. After hiring insurance companies, brokerage firms and others to manage the money, the businessmen reaped several million dollars in commissions and fees from the companies.  No one paid much attention until the market went sour. Then a quarter of the pension fund melted away. A new county controller was elected, and he concluded the flow of political money had undermined the fund." (Pensions | Conflicts of Interest)

Profiting From Pensions:  Turnabout Is Not Always Fair Play, Thomas G. Donlan, Barron’s, November 4, 2002.  “For several years in the late 1990s, investors ignored an obscure but significant source of earnings in the reports of many major corporations. Most companies with defined benefit pension plans were reporting that their retirement-plan finances were so secure that they didn't need to put any more cash aside. The security, however, was the stock market.”   (Pensions | Use of Pensions (Assumptions) to Boost Earnings)

Public Pension Funds Will Put More Money Into Stocks, Joe Mysak, Bloomberg Online, May 23, 2003.   "States and municipalities are going to put more money to work in the stock market.  That's good news for the stock market, certainly, and may translate into good news for the economy. Whether it's good news for retirees is another matter."  (Pensions (Local and State Pension Funds))

Public Pension Plans Face Billions in Shortages, Mary Williams Walsh, The New York Times, August 8, 2006.  “In 2003, a whistle-blower forced San Diego to reveal that it had been shortchanging its city workers’ pension fund for years, setting off a wave of lawsuits, investigations and eventually criminal indictments.  The mayor ended up resigning under a cloud. With the city’s books a shambles, San Diego remains barred from raising money by selling bonds. Cut off from a vital source of cash, it has fallen behind on its maintenance of streets, storm drains and public buildings. Potholes are proliferating and beaches are closed because of sewage spills.  Retirees are still being paid, but a portion of their benefits is in doubt because of continuing legal challenges. And the city, which is scheduled to receive a report today on the causes of its current predicament, still has to figure out how to close the $1.4 billion shortfall in its pension fund.”  (Pensions (Public))  New York Gets Sobering Look at Its Pensions  Seminar

Public Pensions Come Up Short As Stocks' Swoon Drains Funds, Kara Scannell, The Wall Street Journal, August 17, 2002.  "Inexperience among pension-fund managers, who sometimes have nonfinancial backgrounds, led to poor asset-allocation decisions at some plans. "The biggest sin they might have committed at the peak of the market was that many funds, not just public funds, were reluctant to rebalance" their portfolios, so they included too risky a proportion of stocks, says Jay Kloepfer, head of the quantitative consulting group at Callan Associates, a San Francisco adviser to pension plans."  (Pensions (Local and State Pension Funds))

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Red-Handed? Analysts Worry that Pension Gains Smack of Cookie-Jar Accounting,  Barron's, July 9, 2001.  "A chunk of that so-called income, however, derives from the company's treatment of its pension income accounting, and some analysts have raised questions about whether it can be sustained down the road."  For Table:  Pension Patrol.  (Pensions | Use of Pensions (Assumptions) to Boost Earnings)

Rising U.S. State Unfunded Pension Liabilities Are Causing Budgetary Stress, Standard & Poor’s Research Report, February 22, 2006.  Seminar

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SEC Sees Indications Of Fund Payments To Pension Planners, Deborah Solomon and Christopher Oster, The Wall Street Journal, October 25, 2004.  “The Securities and Exchange Commission is finding troubling indications that mutual-fund companies and other money managers paid retirement-plan consultants to be recommended to the consultants' clients, people familiar with the probe said.  The SEC, ramping up scrutiny of potential financial-services industry conflicts, in December launched a broad examination of retirement-fund consulting to determine whether consulting firms and money-management companies engaged in quid pro quo arrangements and whether clients were informed of any financial relationships between their consultants and the management companies they recommend.” (Pensions | Conflicts of Interest)

SEC Investigates Six Companies On Pension, Benefit Accounting, Ellen E. Schultz, The Wall Street Journal, October 18, 2004.  “The Securities and Exchange Commission is investigating whether six large companies could have manipulated earnings by using certain assumptions to calculate liabilities and costs for pensions and retiree health benefits.  A spokesman for the SEC stressed that the agency has no evidence of violations but added that the companies, which he didn't identify, weren't selected at random. The inquiry focuses on assumptions companies use to calculate current pension expenses, which can have an effect on income. The inquiry was reported last week by BusinessWeek magazine.”  (Pensions | Use of Pensions (Assumptions) to Boost Earnings)

Seamy Side of Pension Funds, Janice Revell, Fortune, Monday, August 12, 2002.  "Three years ago the 52-year-old finance director for Nashville listened to investment consultant UBS PaineWebber outline a major asset-reallocation plan for the city's $1.34 billion pension fund. It would decrease the fund's expected return and increase risk. Manning was suspicious and launched a review of PaineWebber's performance. Good idea. It turned out that its own brokerage arm was executing 95.8% of the fund's domestic stock trades--a hugely disproportionate share, say industry watchers, who note that a fund that size would typically have dozens of brokers handling its trades. As a result, PaineWebber--the pension consultant--was raking in more than $1 million a year in trading commissions; the new plan it proposed would have netted it $300,000 more. "The conflicts of interest were incredible," says Manning."  (Pensions | Conflict of Interest (Overcharging and "Professional" Money Managers))

Senate Passes a Bill to Cover Pension Plans, Mary Williams Walsh, The New York Times, January 29, 2004.  “The Senate overwhelmingly passed legislation yesterday that would save companies an estimated $80 billion on their pension contributions over the next two years, but it was unclear whether the Bush administration would support the measure.  Companies that sponsor traditional pension plans have been coping with several years of bad market conditions, and the Senate bill is intended to tide them through until the climate improves. The centerpiece of the bill is a temporary change in the way companies calculate - in today's dollars – the amount they owe their employees in the future. The change would make these obligations look smaller, which in turn would allow the companies to set aside less money today."  (Pensions)

Sinkhole!  How Public Pension Promises Are Draining State and City Budgets., Special Report, Business Week, June 13, 2005.  “The public schools in Jenison, Mich., are real gems: Test scores are well above the national average, its autism and special-education program is recognized around the country, and the music program has been honored by the group that hands out the Grammy Awards. The 4,800-student district averages close to 100% attendance at parent-teacher conferences, and on Friday nights in the fall families crowd the high school stadium's bleachers to watch football. Parents have moved to this idyll on the west side of the state from as far away as Kentucky, Texas, and New Jersey just to get their kids enrolled. Over 500 students from nearby districts attend Jenison by choice." (Pensions (Local and State Pension Funds))

Some Cities Struggling to Keep Pension Promises, Mary Williams Walsh, The Wall Street Journal, May 5, 2004.  "A few years ago, the city of Houston decided to sweeten its workers' retirement benefits. Along with their traditional pensions, city workers nearing retirement were offered special accounts, fed with money from the city pension fund. Although the accounts would pay generous returns, a study showed that the cost to the city would be modest.  What seemed a good idea then now looks ruinous. Hundreds of older workers will qualify for million-dollar payouts at retirement from these accounts. When their monthly pension checks start coming, some will actually have higher incomes than they did when they were working.  The city pension fund cannot support the payouts and has about $1.5 billion less than the benefits it owes the work force. The district attorney is looking into possible wrongdoing. City voters will go to the polls on May 15 to decide whether Houston should opt out of a Texas constitutional requirement that all pension promises be kept."  (Pensions (Local and State Pension Funds) | Retirement Planning)

Sunny San Diego Finds Itself Being Viewed as a Kind of Enron-by-the-Sea, John M. Broder, The New York Times, September 7, 2004.  “In the summer of 2003, Diann Shipione, an investment adviser at UBS Financial Services in San Diego and a trustee of the city's employee retirement system, was scanning a prospectus on a proposed San Diego sewer bond issue when alarm bells began to ring in her head.  Important financial information was missing. The prospectus did not mention that the city had for years been shortchanging its public pension fund, leading to an unfunded liability of more than $1.15 billion, or that the city owed nearly $1 billion more in health care benefits to retirees and did not have the money. And it implied that the pension fund's actuary had approved the underfunding when Ms. Shipione knew that he had not.  In a letter to city officials, and in a commentary in the local newspaper, Ms. Shipione blew the whistle.” (Pensions (DROP Plans | San Diego))

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Taking the Wheel Before a Pension Runs Into Trouble, Mary Williams Walsh, The New York Times, January 30, 2005.  “Until recently, a pension seemed like a sure thing. If you worked long enough, you could count on a predetermined stream of income upon retirement, backed by the federal government.  Now, however, a series of pension failures at companies like United Airlines, US Airways, Bethlehem Steel, Kaiser Aluminum and Polaroid has cast doubt over such certainties. While the government insures pensions, the coverage is limited - and it is much more varied than the government's insurance for bank deposits. In the last two years, tens of thousands of pilots, steelworkers, managers, mechanics and others have discovered that the pensions they earned were richer than the government's insurance - something that they did not know until their pension plans had failed.” (Pensions | PBGC | Retirement Planning)

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Unmasking That Pension Consultant, Gretchen Morgenson, The New York Times, February 20, 2005.  “It’s something of a mystery why the huge and presumably powerful public pension funds in this country have been so loath to investigate whether they have been hurt by their consultants' conflicted loyalties. After all, the biases in these organizations are of enough concern to the Securities and Exchange Commission that it has conducted an industrywide investigation of pension consultants and may recommend enforcement actions against some of them.  Well, last week, the ice finally began to crack on this important issue. The board of the Public School Teachers' Pension and Retirement Fund of Chicago is reviewing a proposal to conduct a comprehensive conflict-of-interest audit of its investment consultant, Mercer Inc., a unit of Marsh & McLennan. The fund has $10.3 billion in assets and has been a Mercer client since 1990.” (Pensions | Conflicts of Interest)

U.S. Insurer of Pensions Says Its Deficit Has Soared, Mary Williams Walsh, The New York Times, January 16, 2004.  “The federal agency that insures pension plans said yesterday that its deficit had grown from $3.6 billion to $11.2 billion in just a year and that it would try to deal with the escalating problem by overhauling its own investments, among other measures.  The agency, the Pension Benefit Guaranty Corporation, said that two consecutive years of record failures by corporate pension plans and continuing adverse market conditions left it with a shortfall much greater than a year earlier, which had been the previous low point in the agency's 30-year history."  (Pensions)

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What Rough Beast: The Pension Disaster will be Borne in More Places than Just Bethlehem Steel, Thomas G. Donlan, Barron’s, December 23, 2002.  “Easy come easy go:  The pension pendulum swings again. After years of contributing to corporate bottom lines, pension obligations are once again a drain on corporate cash. As long as their projected earnings from pension assets exceeded their projected payments to pensioners, corporations with defined-benefit pension plans didn't need to save. In fact, federal law prohibited them from building up large surpluses even if they wanted to, because Congress has deemed such security an unwarranted corporate tax shelter. Pension contributions are tax-deductible, after all.”  (Pensions)

When Pensions Change Hands, Retirees Can Be Lost in Shuffle, Ellen E. Schultz, The Wall Street Journal, May 18, 2002.  “For 18 years, Charlie Craven, a retired mine supervisor in Tucson, Ariz., received a pension of $348.48 a month.  But in late December, instead of a check, he got a letter saying an audit showed he was receiving the benefit in error.  "You must repay the overpayment of $18,363.44 in one lump sum by January 31, 2005," said the letter from the pension administrator. "If you are unable to make a one time lump sum repayment and wish to set up a repayment plan, your payments are as follows: $1,530.29 per month for (12) months." The letter added: "If you do not comply within the stated timeframe, the plan sponsor may take additional steps," such as reporting the "overpayment" to tax authorities or taking "more formal collection action against you." (Pensions | Retirement Planning)

Whoops! There Goes Another Pension Plan, Mary Williams Walsh, The New York Times, September 18, 2005.  “Robert S. Miller is a turnaround artist with a Dickensian twist. He unlocks hidden value in floundering Rust Belt companies by jettisoning their pension plans. His approach, copied by executives at airlines and other troubled companies, can make the people who rely on him very rich. But it may be creating a multibillion-dollar mess for taxpayers later.  As chief executive of Bethlehem Steel in 2002, Mr. Miller shut down the pension plan, leaving a federal program to meet the company's $3.7 billion in unfunded obligations to retirees." (Pensions)

Why Do They Sneer at Shipione, Don Bauder, San Diego Reader, April 1, 2004.  “Federal examiners are looking into possible "pay-to-play" shenanigans in the pension-consulting business. And one of the pension consultants being studied is Callan Associates, the San Francisco­based firm long used by the woe-beset San Diego City Employees' Retirement System.  Former Securities and Exchange Commission chairman Arthur Levitt says that the "pay-to-play" issues are "very, very serious and very widespread -- they are all related to conflict-of-interest questions." (Pensions (DROP Plans | San Diego))

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