North American trade deal won’t include measure to rescue underfunded pension plans

A plan to shore up struggling pension plans key to the retirement of tens of thousands of Teamsters and other workers in Massachusetts lost its best chance of congressional approval this year when its Democratic backers left it out of a landmark trade agreement.

Representative Richard Neal, the Massachusetts Democrat who chairs the Ways and Means Committee, sponsored the Butch Lewis Act, which would recapitalize multi-employer pension plans covering over a million workers nationwide. The bill was overwhelmingly approved by the House in July but has been bottled up in the Senate. Neal in October floated the idea of attaching it to the United States-Mexico-Canada trade deal negotiated by the Trump administration.

But opposition by the White House and House Republicans, some of whom termed the pension measure a “bailout,” effectively kept it out of the three-nation trade measure, which is expected to come up for a vote Thursday. It’s seen by leaders of both parties as a rare opportunity to agree on legislation that could prove popular with their constituents.

People involved in the negotiations said opponents used a procedural maneuver to keep the pension rescue out of the trade agreement, requiring that the deal make its way through Congress under so-called trade promotion authority, which doesn’t permit amendments.

“We couldn’t overcome the ideological divide, but we’re not going to give up,” said John Murphy, a Boston vice president of the International Brotherhood of Teamsters who has led the union’s efforts to rescue the financially troubled pension plans. “This is an issue that’s not going to go away. Too many regular Americans’ lives are impacted by this.”

Murphy said he remained hopeful the bill — which would empower the Treasury Department to issue government bonds that would finance loans to underfunded multi-employer pension plans — will eventually pass in the Senate. He noted it won the support of 29 Republican representatives in the House and of Senator Susan Collins, a Maine Republican.

In a report released Tuesday, the pension consulting firm Cheiron Inc. said as many as 117 multi-employer pension plans covering 1.4 million participants are underfunded by a total of $56.5 billion. The plans, created by small employers who pooled resources to offer pensions, have alerted regulators and participants they could fail within the next two decades because they lack the money to meet their pension obligations.

Two of the largest funds are Central States Teamsters, which has $26 billion in unfunded liability, and New England Teamsters, with $5.5 billion in underfunded liability, according to the Cheiron report. The Central States fund covers some workers and retirees from Massachusetts.

Neal and House Speaker Nancy Pelosi also tried and failed to include the multi-employer pension rescue, which would also help ironworkers and auto workers, in an appropriations package that required approval by leaders in both chambers of Congress. Neal issued a statement calling the absence of Butch Lewis an “egregious omission.”

Neal said the bill “addresses the worsening crisis that threatens the retirement savings of more than a million workers and retirees who — year after year — gave up wage increases in order to fund their pension plans. Now . . . their planned retirements are in jeopardy.”

Despite the 29 Republican votes for Butch Lewis last summer, the Ways and Means ranking member, Kevin Brady, said the measure “needs a tremendous amount of work” to gain broader support from his party.