<nobr>May 11, 2009</nobr>

ERIC and Over 200 Organizations Write to Treasury on Pension Funding Relief

ERIC along with 209 other organizations on May 8 wrote to Treasury Secretary Tim Geithner regarding the need for additional and immediate defined benefit plan funding relief. The letter was signed by individual companies, trade associations and not-for-profit organizations.

The letter thanks Treasury for the helpful guidance that has been issued since the pension funding crisis began, but warns that "more challenges lie ahead." The letter explains that the earlier relief was a major step forward for calendar year plans with respect to the 2009 plan year, but many plans with non-calendar year plan years may face huge funding burdens for their plan years beginning in 2009. And if the market does not fully recover by the end of this year, plans across the country could face 2010 funding obligations that are far greater than the obligations for 2008 or 2009, the letter states.

The letter requests among other things that companies be permitted to make new interest rate elections for plan years beginning in 2010. It states that although many companies feel compelled to elect the yield curve for 2009, the unpredictability of the full yield curve will not necessarily result in long-term relief. Consequently, there is a great need for companies using the full yield curve for 2009 to be able to elect to use the segment rates for 2010.

Secondly, the letter requests that the funding regulations should not be effective until plan years after December 31, 2009.

A link to the letter appears below.

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Websites:

Letter to Treasury Secretary

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