Skip to main content

TVA Additional Contribution to TVARS

On August 23, 2017, the TVA Board approved TVA’s $300 million contribution to the TVA Retirement System for fiscal year 2018.  The TVA Board also approved an additional one-time $500 million contribution to be made this fiscal year (fiscal year 2017).

 This additional $500 million, plus annual credited interest, can be used by TVA in lieu of contributions at any future time at TVA's discretion. (See Section 9B5 on page 64 of TVARS' rules.) It does not increase TVA's long-term funding commitment to TVARS. 

 The United States Government Accountability Office (GAO) has already pointed out in its March 2017 report that TVA's long-term funding commitment is not enough to ensure the plan’s full funding.  The GAO specifically stated that TVA should “propose, and work with the TVARS board to adopt, funding rules designed to ensure the plan’s full funding.”  (See the GAO’s recommendations for executive action on page 34 of their March 2017 report.)  Why will TVA not work with us on the TVARS Board to adopt funding rules designed to ensure the plan’s full funding?

Comments

  1. AnonymousSeptember 5, 2017 at 4:42 PM

    So they are putting in $800m in one year and you still aren't happy? You are a special kind of stupid.

    ReplyDelete
    Replies
    1. Leonard J. Muzyn, Jr., CFASeptember 6, 2017 at 5:28 AM

      Whatever you say Anonymous. The GAO team and I must just be really stupid.

      Delete
    2. AnonymousSeptember 17, 2017 at 7:07 PM

      $300m a year with a one-time payment of $500m apparently impresses Anonymous#1. But it's too little, too late; a drop in the bucket towards properly funding the retirement system, as other companies must do.

      Delete

Post a Comment

Popular posts from this blog

Why do TVARS board meetings remain closed?

Within the next couple of months, the TVARS board must vote on a contribution amount to recommend that TVA make in fiscal year 2014. In conjunction with the contribution amount, it is possible the vote will include amendments to the rules. In conjunction with the contribution amount in 2009, the rules were amended to: suspend contribution requirements and related actuarial valuations for four years (Section 9B9); suspend the requirement that part of the contribution go to the “excess COLA account,” which was designed to accumulate and grow funds to be used for payment of future COLAs (Sections 9B9, 10D1 and 10D2); and reduce legitimate accrued pension benefits (Sections 6I, 7L and 18C3). The vote in 2009 was not open to observation, and unless the TVARS board takes action, neither will the vote this year. Not one of the six other TVARS board members would second the motion I made in December to open TVARS meetings to observation. All that is required to open future boa...
18 comments
Read more

Introduction

This is my personal blog to facilitate communication among TVA employees, retirees and beneficiaries who are members of TVARS and who wish to preserve their retirement benefits. Please join my site and post your comments.  I have been an elected member of the TVA Retirement System (TVARS, or the system) board of directors since 2003. I am not speaking officially for the TVARS board of directors or TVA management. TVARS is an entity legally independent of TVA. Three of the board members are TVA employees (including myself), three are appointed by TVA management (currently all TVA executive managers), and the seventh is generally a retired TVA employee (appointed by the other six). As TVA employees, we all have a duty of loyalty to carry out directives issued by TVA management in our regular TVA jobs. However, each board member has a fiduciary duty to all the members of the system when performing TVARS duties. This fiduciary duty legally supercedes our duty of loyalty to carry out di...
21 comments
Read more

Why isn't the TVARS board protecting TVARS members?

In order to protect TVARS members in the event the federal government divests TVA, the TVARS board can clarify in the TVARS rules that COLAs are vested benefits . (See support from Dennis To here .) Time is very critical now that TVA is working with President Obama’s administration on a financial review of TVA which includes the option of TVA being divested from the federal government. (See here .) TVARS could be terminated upon divestiture. It is very important that the TVARS board take steps to safe-guard benefits before this occurs. If system termination occurs while TVARS remains significantly underfunded, TVARS may never be able to achieve fully funded status. Not one of the six other TVARS board members would second the motion I made in June 2012 to clarify that COLAs are vested benefits. Once again, I would be glad to forward any e-mails from you to the entire TVARS board. Please e-mail them to me at ljmuzyn@tva.gov .
20 comments
Read more