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Eight-Year Funding Plan a Disaster; Twenty-Year Plan Will Fix It?


In eight years, with a 4-3 majority of the TVARS Board voting to reduce benefits in 2009 and again in 2016, TVA's pension funded ratio declined from 77% to 55%. TVA has now embarked upon a twenty-year funding plan which was approved by a 4-3 majority of the TVARS Board in 2016 along with the most recent benefit reductions.

Loyalton, CA reduced their retirees' pensions by 60%. They are 40% funded. See the Fox Business video here. Note that Loyalton pulled out of CalPERS and has quit meeting its funding obligations to CalPERS. That is what led to the cuts.

Comments

  1. This is nothing compared to what will happen under a Trump-appointed TVA Board. They'll stick it to us pampered Federal employees and retirees.

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  2. We could point out to the incoming administration that TVA would save money if its SERP were eliminated and all of its employees were paid pensions only through TVARS. We could also point out that TVA would be more responsive and efficient if its board were switched back to a smaller full-time board.

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  3. I'd love to see that math Leonard. The SERP is not nearly as expensive as it would be to give a pension (as opposed to a defined contribution plan) to all employees. You continue to be a complete joke.

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  4. I am having trouble following your logic. Are you saying the SERP should be given to all employees in place of the pension to save TVA money?

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  5. No, I'm saying the SERP is not the problem. I'm also saying that switching back from a 401k to a pension for all employees is a terrible idea and would be much more expensive.

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  6. What about simply adequately funding the pension that still covers some employees and many retirees? Is that a terrible idea too? I suppose it is for those TVA executives receiving a SERP which is fully funded. It isn't a terrible idea for those employees and retirees counting on their pensions. It isn't a terrible idea for new employees either because they can see that they are next. The 401K match supplied by TVA can easily be reduced at any time.

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  7. There is not a concern of them paying the pension benefits from people who actually understand it. You are just fear mongering. They also can't easily reduce the 401(k)or they will no longer be competitive in the marketplace. TVA is not the desirable destination job that it used to be. They have to pay correctly.

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  8. You write that employees and retirees should not be concerned about TVA paying pension benefits. Can you then explain to me why TVA reduced promised pension benefits by a total of about $1B beginning in 2009? We should not worry because future benefits will be paid, but just at lower and lower levels as dictated by TVA?

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