Senate Unanimously Passes Pension Reform Legislation

The U.S. Senate today passed S. 1302 by unanimous consent. The legislation eliminates the Deficit Reduction Contribution for electric cooperatives’ Retirement Security Plan and makes the Pension Protection Act (PPA) exemption permanent.

PPA’s “single-employer” plan rules are designed specifically to protect the Pension Benefit Guaranty Corporation (PBGC) in case a single employer maintaining a plan goes bankrupt. Rural cooperative “multiple-employer” defined benefit plans have a completely different risk profile. The NRECA Plan, for example, has more than 880 independent, participating employers with 56,000 participants in 47 states. S. 1302 recognizes the low risk posed by these plans and resolves this inequity permanently.