Congress staying neutral in TVA pension fight

WASHINGTON — A union representing TVA employees is calling for congressional hearings on proposed changes to the employee pension plan and is asking lawmakers to hold the utility accountable for its pension obligations.

But members of Tennessee’s congressional delegation don’t seem eager to take sides in the fight.

“We are well aware that TVA’s pension system is signif icantly underfunded and reforms are necessary,” a spokeswoman for U.S. Sen. Bob Corker, R- Chattanooga, said last week. “While we do not inject ourselves in the decision- making of the board, we do understand that we will be hearing from those affected by these proposals and look forward to those conversations.”

Other lawmakers and their aides issued similar, noncommittal statements after union representatives made the rounds on Capitol Hill recently to lobby Congress to block the proposal.

“As the Tennessee Valley Authority board of directors works to correct shortfalls in their pension plan, I have asked that they continue to strive to balance their concerns of rising costs for ratepayers with the promises they made to their retirees, employees and families concerning their benefits and future retirement,” said U.S. Rep. Steve Cohen, D-Memphis.

U.S. Rep. Chuck Fleischmann, R-Ooltewah, said he’s aware of concerns about the pension fund’s long- term health and stressed “it is important that TVA ultimately gets this fixed.” But he gave no indication he would get involved.

U.S. Rep. Scott DesJarlais, R- South Pittsburg, said he has faith that Bill Johnson, TVA’s president and CEO, has been working “diligently” on the pension issue “with an eye toward balancing the needs of workers, ratepayers and retirees.”

Union members don’t see it that way.

“This is a federal government corporation, but those who work in the executive suite are lining their pockets like TVA is their personal business while forcing ‘austerity’ on frontline employees,” said Gay Henson, president of the Engineering Association IFTPE Local 1937. “It’s wrong. It’s shortsighted. It may be illegal — and if it’s not, it should be.”

The union, which represents more than 2,600 TVA employees, is objecting to a proposal TVA management says would bring the underfunded pension fund up to proper levels over the next 20 years.

The proposal includes freezing benefits for employees hired since 1996 and moving them into a 401(k) plan, as well as reducing cost-of-living adjustments for retirees who have been part of the plan since 1968. The changes would affect some 11,000 current employees and 24,000 retirees.

In an interview, Johnson called the proposal “a fair solution that can help us get to a better-funded status and bring long-term financial health to TVA and the pension system.”

Right now, the pension fund has about $6.8 billion, roughly half of what actuaries estimate is needed. TVA is proposing to commit at least $275 million a year, or $ 5.5 billion over the next two decades, to help close the shortfall.

But union officials argue the proposal would cut employee benefits while preserving lavish pensions and perks for TVA’s top executives — an accusation Johnson says isn’t true.

“All of the executives here are in one of the three pension plans that everybody else is in,” he said. “Changes in those plans will affect everybody, including the executives.”

Union officials also complain the proposal was put together in secret without any input from those who will be impacted.

“I’m interested in working with TVA and coming up with solutions,” Gay said. But, “It’s difficult to know what’s going on. We really need some transparency there.”

Gay and other union officials had hoped their recent meetings with congressional staffers would lead to oversight hearings at the least and maybe slow down the proposal until its impact on employees and retirees can be determined.

That seems unlikely given the reaction of Tennessee’s Congress members.

U.S. Sen. Lamar Alexander, R-Maryville; U.S. Rep. Phil Roe, R-Johnson City; and U.S. Rep. Jim Cooper, D-Nashville, are aware of the workers’ concerns, their offices said. But they took no position on the proposed changes.

Alexander “believes it is important that TVA’s board continues to address this issue so TVA employees and retirees can continue to count on the health and stability of the pension fund,” said his spokesman, Jim Jeffries.

Roe recognizes the funding challenges TVA’s pension system faces are “significant” and hopes “a path forward can be found,” said his spokeswoman, Tiffany Haverly.

The board that oversees the TVA retirement system is expected to act on the proposal or a similar one by the end of February.