Sponsors (41)
The bill restores full vested pension payments and provides timely retroactive lump sums (with favorable tax timing) to affected Delphi/PHI/ASEC retirees, but does so at taxpayer expense and with risks to PBGC's financial position and unequal treatment for some excluded workers.
Retirees and beneficiaries in the listed Delphi, PHI, and ASEC plans will receive higher monthly pension payments equal to their full vested plan benefits instead of reduced PBGC guarantees.
Eligible participants and beneficiaries will receive lump-sum retroactive payments within 180 days to make up past underpayments, restoring owed benefits promptly.
Recipients can elect to spread taxation of the lump-sum payments over three tax years, reducing immediate tax burdens and easing cash-flow impacts for retirees.
Taxpayers will bear the cost because the Treasury is appropriating unspecified sums from the general fund to cover increased PBGC payments.
PBGC's insurance program financial position could worsen if large retroactive payments reduce its reserves, potentially risking future premium increases or reduced benefit protections for other participants.
Workers who received the 1999 GM top-up payments are excluded and receive no benefit from this change, creating unequal treatment among similarly affected retirees.
Based on analysis of 2 sections of legislative text.
Requires the Pension Benefit Guaranty Corporation (PBGC) to pay covered participants and beneficiaries the participant’s full vested monthly pension (rather than a reduced PBGC guarantee) for eligible terminated defined-benefit plans, and directs PBGC to recalculate prior guarantees and pay past-due lump sums. PBGC must consult Treasury and Labor and complete lump-sum payments within 180 days; several statutory definitions and exclusions determine who is eligible. This changes how PBGC computes guaranteed benefits for covered plans, expands payments to many retirees and beneficiaries who were receiving reduced PBGC guarantees, and preserves PBGC’s existing recovery rights and asset allocation rules.
Requires PBGC to pay full vested monthly pension benefits, recalculate prior guarantees, and pay lump-sum past-due amounts to eligible participants and beneficiaries.
Official title: To increase the benefits guaranteed in connection with certain pension plans, and for other purposes.
Introduced February 13, 2025 by Michael R. Turner · Last progress February 13, 2025