Archived Insight | August 9, 2022

SFA: Solvency Through 2051?

The multiemployer Special Financial Assistance (SFA) program, which was part of the American Rescue Plan Act passed by Congress in March 2021, is intended to enable eligible deeply troubled plans to pay all benefits and expenses due through 2051. Interim PBGC rules drew considerable criticism from a wide variety of stakeholders. Final regulations recently issued by PBGC respond to those concerns. Although the final rules primarily affect eligible plans that apply for SFA, there are also implications for some plans that may have not considered SFA.

On August 9, our actuarial, compliance and investment advisory experts discussed the considerations for plan sponsors resulting from the PBGC’s final rule, including:

Changes to calculating the amount of SFA: impact of a dual interest rate approach
Special consideration of plans that suspended benefits under the Multiemployer Pension Reform Act of 2014
Application timing: changes to and “locking in” of the measurement date; filing of a supplemental application
Restrictions imposed on plans that receive SFA: mergers, withdrawal liability, contribution rates, benefit improvements
Expansion of permissible investments; implications for asset mix and solvency
Review of the limitations for both the return seeking assets and remaining SFA assets

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Presenters

Moderator: Eli Greenblum, SVP and Chief Actuary

Panelists:

Susan Boyle, SVP, Actuary and Multiemployer Retirement Practice Leader
Beth Bangert, SVP, National Retirement Compliance
TJ Kistner, VP, Head of Discretionary Portfolio Management & Solutions

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This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.