Former U.S. Vice President Joe Biden, 2020 Democratic presidential candidate, speaks on the Teamsters Local 249 hall during a campaign stop in Pittsburgh, Pennsylvania, U.S., on Monday, April 29, 2019.
Justin Merriman | Bloomberg | Getty Images
President Joe Biden on Thursday is announcing the infusion of nearly $36 billion to shore up a financially troubled union pension plan, stopping severe cuts to the retirement incomes of greater than 350,000 Teamster staff and retirees across the USA.
The cash for the Central States Pension Fund is the biggest amount of federal aid provided for a pension plan, the Biden administration said, and comes from the American Rescue Plan, a $1.9 trillion coronavirus relief package that he signed into law in 2021.
Many union retirement plans have been under financial pressure due to underfunding and other issues. Without the federal assistance, Teamster members could have seen their advantages reduced by a mean of 60% starting inside a few years.
“Union staff and their families are finally capable of breathe an enormous sigh of relief, knowing that their hard-earned retirement savings have been rescued from steep cuts,” said Lisa Gomez, assistant labor secretary for worker advantages security.
Multiemployer pension funds are created by agreements between unions and corporations and are partially insured by the federal government’s Pension Profit Guaranty Corporation. The insurance program was on target to grow to be insolvent in 2026, however the pandemic relief money is predicted to maintain it on firm footing through 2051.
Biden traveled to Ohio in July to spotlight the ultimate rules for the pension relief program. Before Thursday, this system had awarded aid to 36 troubled pension plans, but none of those had received greater than about $1.2 billion.
The quantity going to the Central States Pension Fund represents somewhere between one-third and one-half of the overall estimated cost of the federal aid program.
The retirement plan has participants in almost every state, with the biggest concentration within the Midwest. There are about 40,000 participants in each Michigan and Ohio, nearly 28,000 in Missouri, 25,000 in Illinois and about 22,000 each in Texas and Wisconsin, in accordance with figures provided by the White House.
