NJ-Based Teamsters Pension to Get $29.3M in SFA Funds

The Pension Benefit Guaranty Corporation announced Friday that it will provide $29.3 million in assistance under the Special Financial Assistance Program to the Teamsters Local 11 Pension Plan, approving the plan’s application.

The SFA Program provides financial assistance to multiemployer pension funds that are distressed and on the verge of insolvency.

The New Jersey-based Teamsters Local 11 plan covers 2,112 participants in the transportation industry. According to the plan’s Form 5500 for plan year 2023, the plan had assets of $75.18 million and has a funded status of 61.7%. The plan is in critical status and, prior to receiving the assistance, was not expected to emerge from critical status until 2043.

The Department of Labor informed the plan that it had entered critical status—meaning the plan had significant funding and/or liquidity problems—on June 29, 2021. The plan applied for special financial assistance on August 29, 2024.

“By providing Special Financial Assistance, the Biden-Harris administration will ensure that these … workers in the North Jersey area get the benefits they have earned after a lifetime of hard work and can retire with dignity,” said Acting Secretary of Labor Julie Su in a statement.

According to a statement by the PBGC, the organization has provided a total of $69.8 billion in Special Financial Assistance funds to pension plans covering more than 1.2 million workers. Nearly 70% of the assistance has gone to plans administered by Teamsters union locals. Approximately 33 Teamsters unions, covering 538,000 participants, have received a total of $48.7 billion in special financial assistance since March 11, 2021.

The SFA Program was enacted as part of the American Rescue Plan Act of 2021. Plans that receive special financial assistance from the PBGC must allocate at least two-thirds of the assistance provided to fixed-income investments. According to the Final Rule on Special Financial Assistance, issued in July 2022, the other third can be invested in “return-seeking investments,” such as stocks and stock funds.