Legislation proposed to address United Mine Workers pensions

A group of lawmakers from coal states and United Mine Workers officials announced legislation Tuesday that would provide funding to protect the pensions of more than 100,000 coal miners and their families.
The “American Miners Pension Act” will employ an “innovative, cost-saving approach” to fund the union’s multi-employer pension fund impacted hard by the 2008 financial crisis and coal company bankruptcies, the union said.
The UMW’s 1974 pension plan was 93 percent funded in 2007 but lost more than $2 billion in assets following the 2008 financial crisis. Subsequent coal company bankruptcies led to fewer employer contributions to the plan, putting the plan at risk of becoming insolvent by 2022.
The union proposes beefing up the plan using unused funds from the Abandoned Mine Land program and low-interest loans from the U.S. Treasury.
The loans will be needed for only about four years before the pension fund is returned to solvency, the union said. The fund will pay off principal and interest on the loans over 30 years.
“A secure loan now is a much better deal for taxpayers than a huge liability a few years down the road,” UMW President Cecil Roberts said in announcing the legislation.
If the pension plan was to become insolvent, the federal Pension Benefit Guaranty Corporation would face a multi-billion dollar liability, putting U.S. taxpayers on the hook, Roberts said. This would also threaten the solvency of the PBGC and creating problems for others insured by the agency.
In Pennsylvania, 13,269 pensioners receive benefits under the plan, according to information provided earlier by the union. This includes 1,436 pensioners in Greene County, 1,587 in Washington County and 2,120 in Fayette County.
Similar legislation to address the pension and retiree health benefits was introduced last year and a portion of it was addressed in a spending bill approved by Congress in December.
The spending bill included permanent funding for health care benefits for more than 22,000 retired union miners who worked at companies that filed for bankruptcy in recent years. It did not, however, address the union’s failing pension.
In pushing the bill, the UMW maintains it is only asking Congress to keep the “promise” the federal government made to union miners in 1946. That “promise” of lifetime pensions and health benefits was first made then during negotiations between the UMW and the federal government, which had seized the nation’s coal mines to resolve long-running strikes.