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Compliance July 13, 2007
PBGC Steps In to Save Abandoned Plan
July 13, 2007 (PLANSPONSOR.com) - The Pension
Benefit Guaranty Corporation (PBGC) announced it has assumed
responsibility for the underfunded pension plan covering 464
former employees of now-bankrupt Oklahoma Fixture
Co.
Reported by Rebecca Moore
The PBGC said it stepped in because the pension plan was abandoned following the sale of substantially all of the company’s properties to Tulsa-based Penology LLC. PBGC estimates the Oklahoma Fixture Co. Pension Plan, which terminated August 12, 2003, is about 63% funded, with just over $4 million in assets to cover nearly $7 million in liabilities, the announcement said.
The agency expects to be liable for the entire $2.5 million shortfall, but said assumption of the plan’s unfunded liabilities will have no material effect on its financial statements, according to generally accepted accounting principles.
Within the next several weeks the PBGC will send notification letters to all plan participants. Under federal pension law, the maximum pension guarantee for workers in plans that end in 2003 is $43,977 a year for persons retiring at age 65.
Workers and retirees with questions may consult www.pbgc.gov or call 800-400-7242. In addition, more information about the federal Health Coverage Tax Credit is at http://www.pbgc.gov/workers-retirees/benefits-information/content/page13692.html .