NRLN

The National Retiree Legislative Network, Inc. (NRLN) is a District of Columbia nonprofit social welfare organization. NRLN was started by several large retiree organizations from corporations that are household names. NRLN organizations now represent almost 2,000,000 individual retirees.

NRLN seeks to secure federal legislation that will guarantee the fair and equitable treatment of retirees in private and public sector health and pension programs. Also we are committed to watch for and stop legislation that threatens retiree health and pension programs.

Based in Washington, D.C., NRLN is dedicated to securing federal legislation that will guarantee the fair and equitable treatment of retirees in private and public sector health and pension programs. NRLN represents a non-partisan, grass roots coalition of retiree associations with a combined membership of more than 2 million men and women who are seeking to protect their pension and health care benefits. For more information, visit the NRLN Web site at www.nrln.org.

# # #

Click here for NRLN 08 Goals and Structure

Click here for NRLN Organization Chart

Click here for NRLN 08 Legislative Agenda

Click here for NRLN 1st Quarter 2008 Legislative Report

# # #

Recent Updates

Financial Firms Trying To Buy Out Frozen Pension Plans

(August 16, 2008) An August 5, 2008 article in Business Week has drawn attention to the fact that financial firms have been attempting to lay the groundwork to gain government approval to buy out "frozen" pension plans. According to the article some of the world's biggest investment banks, insurers, hedge funds, and private equity shops have been working in Washington, D.C. to gain control of $500 billion worth of "frozen" pension plan assets.

The concept of off-loading pension funds sounds attractive to some companies that would like the chance to rid themselves of struggling pension plans, which can be a burden to a balance sheet. New accounting rules are approaching that will require companies to mark their pension assets to prevailing market prices each quarter-a change that could devastate some companies' profits. As many NRLN members know, a number of companies no longer want to pay for pension plans, troubled or not.

The National Retiree Legislative Network first became aware of this activity by financial firms last October and Jim Norby, then the NRLN President, sent letters to Congressional Committee Leaders opposing the idea. Norby stated: "We cannot help but be suspicious that this is a profit-driven motive and is not in the best interest of retirees."

The NRLN's position was then and is now that the proposed buyouts of corporate pension plans are a dangerous idea that would lead to diminished pension benefits. Among our main concerns is that shareowners of financial companies would expect executives to maximize profits and the firms would have no loyalty to retirees and the employees who will be future retirees.

Last week, the U.S. Treasury Department ruled that employers cannot transfer most pension plans to an unrelated entity without also transferring significant business assets, operations or employees. The ruling apparently is directed toward preventing transfers of tax-qualified pension plans to unrelated firms that only operate the plans, such as financial firms.

Treasury noted that federal law requires qualified pension plans be established by employers for the "exclusive benefit of its employees or their beneficiaries." It stated that transferring a pension plan to a third party in a move that is not part of an acquisition of business assets or operations would benefit a firm whose sole business aim is to profit from the operation of the plan. Such a transfer would not qualify for tax benefits because an unrelated pension operator would not be considered an employer. In addition, the benefits would not be exclusive to employees and beneficiaries.

On its face, the Treasury ruling seems to throw cold water on the financial firms' efforts to buy out "frozen" pension plans. However, Treasury, the Labor Department, the Commerce Department and the Pension Benefit Guaranty Corp have developed guidelines for new legislation that would permit transfers where the transaction is in the "best interest of plan participants, their beneficiaries, employers and the pension insurance system."

Under this so called "legislative framework", a "frozen" pension plan where benefits are no longer accruing could be transferred to an entity unrelated to the employer or former employer, provided certain conditions were met. It would require that advance notice be given to all parties including regulators. Plan acquirers would be required to be in strong financial shape and in well-regulated industries. It would have to be demonstrated that the transfer is in the best interest of participants and their benefits would be exposed to less risk. Supposedly, transfer limitations would be imposed to prevent an undue concentration of risks.

The NRLN will keep a watchful eye on whether such legislation is introduced. If it has the potential to be a threat to retirees' pension security, our Grassroots Network members will be called on to help the NRLN mount a campaign against the proposed legislation.

Bill Kadereit, NRLN President

ACER believes the operation of NRLN is vital to a strong retiree network.  As a member of ACER your membership to NRLN is included.