CBO Finds that Butch Lewis Act Will Not Increase The Solvency of Failing Multiemployer Plans
Last week, the Congressional Budget Office (CBO)—the federal agency that provides budget and economic information to Congress—released a report at the request of Senate Budget Committee Chairman Mike Enzi (R-WY) examining some of the budgetary and economic effects of the House-passed Rehabilitation for Multiemployer Pensions (Butch Lewis) Act (H.R. 397). The Butch Lewis Act would provide loans from the federal government to multiemployer pension plans that are in critical and declining status and on the brink of insolvency. In its analysis, CBO projects that “about one-quarter of the affected pension plans” that would be eligible to receive loans from the federal government under Butch Lewis “would become insolvent in the 30-year loan period and would not fully repay their loans.” Further, CBO also projects that “[m]ost of the other plans would become insolvent in the decade following their repayment of their loans.”
This CBO report reinforces what SWACCA has said all along: while Butch Lewis is a first step in addressing the multiemployer pension crisis, the bill would not address the underlying problems that have caused the multiemployer pension crisis in the first place. Only by authorizing alternative plan designs like composite plans and making other improvements to the multiemployer pension system can Congress begin to address the issues that have placed many of these plans in dire financial condition. SWACCA remains committed to working with Congress to ensure the solvency of the multiemployer pension system through composite plans and other structural improvements.
© 2023 Signatory Wall and Ceiling Contractors Alliance (SWACCA). All rights reserved.