The National Council of Farmer Cooperatives called on Congress to include provisions to provide funding relief to have single-employer pension plans in the next legislative package to address the economic impacts of the COVID-19 pandemic. The call came in a letter sent today to House and Senate leadership.
“Many of the approximately 2,000 farmer cooperatives in the United States continue to provide single-employer pension plan benefits to their employees,” the letter states. “t has been increasingly challenging to fund those benefits in recent years given historically low interest rates…and escalating Pension Benefits Guarantee Corporation (PBGC) premiums. For example, one NCFC member reports that those two factors are leading to a 130% increase in PBGC premiums just this year alone.”
The letter notes that the House-passed Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act included provisions to address these issues.
Among policies that NCFC letter recommends are:
• Lengthening the amortization period for funding shortfalls from 7 years to 15;
• Extending interest rate stabilization beyond 2020;
• Additional measures such as consideration of lowering PBGC premiums.
“Those provisions would assist businesses such as farmer cooperatives continue to offer pension benefits to their employees without severely draining critical working and investment capital,” the letter concludes.
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