WESTERN STATES OFFICE AND 

PROFESSIONAL EMPLOYEES PENSION FUND

SUSPENSION APPLICATION 

Exhibit 16

Exhibit 16: Page 1 of 30






2015 Schedule MB (Form 5500) 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID Number: 94-6076144 

Plan Number: 001 

MB ACTUARY SIGNATURE 

Exhibit 16: Page 8 of 30
Attachment to: 2015 Schedule MB (Form 5500), Line 2b 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

PARTICIPANT COUNT 

The participant count excludes 406 inactive non-vested participants whose liabilities are included in 

the active non-vested current liability. 

Exhibit 16: Page 9 of 30
Attachment to: 2015 Schedule MB (Form 5500), Lines 3 & 9g 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

EMPLOYER CONTRIBUTIONS

Employer contributions shown in lines 3 and 9g are paid pursuant to Collective Bargaining 

Agreements and are received monthly throughout the year. Contributions also include withdrawal 

liability payments and settlements. Contributions are assumed to occur mid-year. 

Exhibit 16: Page 10 of 30
Attachment to: 2015 Schedule MB (Form 5500), Line 4a 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

9 9 9 T H I R D AV E N U E , S U I T E 1 5 3 0 ♦ S EA T T L E , W A S H I N G T O N 9 8 1 0 4 

T E L E P H O N E ( 2 0 6 ) 4 4 5 - 1 8 5 0 ♦ F AX ( 2 0 6 ) 4 4 5 - 1 8 4 0 

W W W . R A E L - L E T S O N . C O M

ACTUARIAL CERTIFICATION REQUIRED UNDER 

INTERNAL REVENUE CODE SECTION 432(b) 

Western States Office and Professional Employees Pension Fund 

Plan Year Beginning January 1, 2015 

TO: Secretary of the Treasury 

Board of Trustees of the 

 Western States Office and Professional Employees Pension Fund 

FROM: Paul L. Graf, Plan Actuary 

DATE: March 31, 2015 

RE: Western States Office and Professional Employees Pension Fund 

 EIN = 94-6076144; PN = 001 

 Plan Sponsor: Board of Trustees Western States Office and Professional Employees 

Pension Fund 

1220 S.W. Morrison St, Suite 300 

Portland, Oregon 97205-2222 

(503) 224-0048 

 

The following certifies that, in accordance with Internal Revenue Code Section 432(b), the Western 

States Office and Professional Employees Pension Fund (“the Plan”), as of the beginning of its 2015 

Plan Year: 

 is not in critical and declining status 

 is in critical status 

 is not in endangered (or seriously endangered) status 

 

As of January 1, 2015, the projections used for this certification estimate the Plan’s funded 

percentage to be 65.5% and the Funding Standard Account Credit Balance to be depleted by 

December 31, 2018. Accordingly, the Plan has not emerged (including the Plan’s approved 2009 5-

year charge base amortization extension under Section 431(d)(1)) from critical status and remains in 

Exhibit 16: Page 11 of 30
Attachment to: 2015 Schedule MB (Form 5500), Line 4a 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

critical statusfor the 2015 Plan Year based on the criteria outlined in Internal Revenue Code Section 

432(e)(4)(B). 

The basis for this certification is as follows: 

1. The projected present value of Plan liabilities as of the beginning of the 2015 Plan Year is 

based on the actuarial valuation as of January 1, 2014, and assumes no future liability gains 

or losses. The data, methodology, Plan provisions and assumptions utilized in the projection 

are those used for the January 1, 2014 actuarial valuation (except where noted otherwise in 

this document) and are outlined in the attached exhibit. 

2. An actuarial projection of the Actuarial Value of Assets is based on the preliminary 

unaudited financial statements as of December 31, 2014, as provided by the Administrator, 

and assumes no investment gains or losses on market values after that date. The January 1, 

2015 Market Value of Assets and 2014 cash flow components provided by the Administrator 

are: 

a. Market Value as of December 31, 2014 $359,819,363 

b. 2014 Employer Contributions 10,439,940 

c. 2014 Benefit Payments 38,445,844 

The assumptions and methodology utilized in the projection are those used for the January 1, 

2014 actuarial valuation and are outlined in the attached exhibit. 

3. For purposes of evaluating critical status emergence, contributions for the current and 

succeeding plan years are projected assuming the terms of the current collective bargaining 

agreements pursuant to which the Plan is maintained continue in effect for succeeding plan 

years. Contributions include the automatic 10% employer surcharge for those contracts 

which have not yet been negotiated with terms consistent with the adopted Rehabilitation 

Plan. The percent of total contributions attributable to surcharges and supplemental 

contributions is assumed to be the same in each future year as it is in 2014. 

For purposes of evaluating “critical and declining” status, as outlined in Internal Revenue 

Code Section 432(e)(6), we have assumed contribution rates increase beyond the current 

CBA(s) in accordance with the adopted rehabilitation plan. 

Based on input from the Board of Trustees, our projections assume that total hours worked 

remain constant at 2014 work levels. 

Exhibit 16: Page 12 of 30
Attachment to: 2015 Schedule MB (Form 5500), Line 4a 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

4. The Plan received approval for a 5-year extension of charge bases effective for the Plan Year 

beginning January 1, 2009, as permitted under Internal Revenue Code Section 431(d): 

a) For the purpose of determining the Plan’s critical status, the applicable charge base 

extensions have not been reflected in these projections. 

b) For the purpose of testing for emergence, the applicable charge base extensions are 

considered. 

5. The Plan was initially certified in critical status as of January 1, 2009. On October 16, 2009 

the Board of Trustees adopted a Rehabilitation Plan under the guidelines of 432(e), which is 

updated and monitored annually. The Rehabilitation Plan includes certain adopted 

reductions in adjustable benefits effective January 1, 2010, and the Rehabilitation Period 

began January 1, 2012. Based on reasonable actuarial assumptions and upon exhaustion of 

all reasonable measures, the Plan cannot emerge from Critical Status, as described in Code 

Section 432(e)(3)(A)(ii). In 2012, the adopted Rehabilitation Plan was updated by the Plan 

Sponsor to include reasonable measures to forestall possible insolvency. 

Exhibit 16: Page 13 of 30



Attachment to: 2015 Schedule MB (Form 5500), Line 4a 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

ILLUSTRATION SUPPORTING ACTUARIAL CERTIFICATION OF STATUS

1

Calculation of Funded Percentage as of January 1, 2015:2

Projected Actuarial Value of Assets $ 354,059,119 

 Projected Present Value of Accumulated Benefits $ 540,363,127 

 Funded Percentage 65.5% 

The Plan was initially certified in critical status for its 2009 Plan Year and over the next 10 years 

commencing January 1, 2015, the Plan is projected to incur an accumulated funding deficiency. The 

credit balance in the Funding Standard Account is projected to be depleted by December 31, 2018. 

Accordingly, the Plan has not emerged (including the Plan’s approved 2009 5-year charge base 

amortization extension under Section 431(d)(1)) from critical status and remains in critical status for 

the 2015 Plan Year. The Plan’s Funding Standard Account Credit Balance projection is as follows: 

December 31, 2015 49,791,336 

December 31, 2016 34,278,811 

December 31, 2017 18,221,493 

December 31, 2018 1,536,326 

December 31, 2019 (16,402,938)

December 31, 2020 (35,475,486)

December 31, 2021 (54,914,578)

December 31, 2022 (75,498,433)

December 31, 2023 (96,095,808)

December 31, 2024 (115,791,350)

December 31, 2025 (142,280,711)

 

1

 Does not reflect the 5-year extension of charge bases effective January 1, 2009, as required for purposes of determining critical 

status. 

2

 Reflects projected assets and liabilities as determined for the January 1, 2015 actuarial certification. 

Exhibit 16: Page 17 of 30
Attachment to: 2015 Schedule MB (Form 5500), Line 4c 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

DOCUMENTATION REGARDING PROGRESS UNDER REHABILITATION PLAN

On October 16, 2009, the Trustees adopted a rehabilitation plan under the guidelines of 432(e), 

which is updated and monitored annually. The Plan’s rehabilitation period began January 1, 2012. 

In 2012, the adopted rehabilitation plan was updated by the Plan Sponsor to include reasonable 

measures to forestall possible insolvency. Based on reasonable actuarial assumptions and upon 

exhaustion of all reasonable measures, the Plan cannot emerge from Critical Status as described in 

Code section 432(e)(3)(A)(ii). 

Exhibit 16: Page 18 of 30






Attachment to: 2015 Schedule MB (Form 5500), Line 8b(2) 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

SCHEDULE OF ACTIVE PARTICIPANT DATA

DISTRIBUTION OF ACTIVE PARTICIPANTS BY AGE AND (FOR 2015 SCHEDULE MB) 

YEARS OF CREDITED SERVICE 

AGE GROUP < 1 1 - 4 5 - 9 10 - 14 15 - 19 20 - 24 25 - 29 30 - 34 35 - 39 40 + TOTAL 

Under 25 0 12 0 0 0 0 0 0 0 0 12

25 - 29 0 47 14 0 0 0 0 0 0 0 61

30 - 34 0 38 42 7 1 0 0 0 0 0 88

35 - 39 0 21 39 22 13 0 0 0 0 0 95

40 - 44 0 26 18 27 24 5 1 0 0 0 101

45 - 49 0 22 27 27 29 14 9 1 0 0 129

50 - 54 0 19 29 26 37 16 18 8 2 0 155

55 - 59 0 17 37 22 36 21 19 5 4 1 162

60 - 64 0 16 23 26 17 21 18 9 8 1 139

65 - 69 0 1 6 6 9 4 4 6 0 2 38

70 and Over 0 0 1 2 1 0 0 0 0 0 4

Unknown 0 16 0 0 0 0 0 0 0 0 16

 

Total 0 235 236 165 167 81 69 29 14 4 1,000

Exhibit 16: Page 25 of 30
2015 Schedule MB (Form 5500), Lines 9c and 9h

Plan Name: Western States Office and Professional Employees Pension Fund

Employer ID Number: 94-6076144

Plan Number: 001

Type of Date Remaining

Base Description Established Balance Period Payment 

Charges 7 Initial Liability 1/1/1976 $ 3,299,082 6.00 $ 650,335

4 Actuarial Assumption 1/1/1978 488,273 6.00 96,252

3 Plan Amendment 1/1/1980 168,439 10.00 22,619

3 Plan Amendment 1/1/1981 1,680,462 11.00 211,562

3 Plan Amendment 1/1/1983 811,209 3.00 289,534

3 Plan Amendment 1/1/1984 609,055 4.00 168,603

3 Plan Amendment 1/1/1985 681,445 5.00 156,003

3 Plan Amendment 1/1/1986 1,019,318 6.00 200,933

3 Plan Amendment 1/1/1987 1,413,505 7.00 246,686

3 Plan Amendment 1/1/1988 2,748,389 8.00 433,319

3 Plan Amendment 1/1/1989 2,572,955 9.00 372,143

3 Plan Amendment 1/1/1990 910,472 10.00 122,268

3,4 Plan Amendment+Act Assump 1/1/1991 1,932,925 11.00 243,346

3 Plan Amendment 1/1/1992 1,250,752 12.00 148,790

3 Plan Amendment 1/1/1993 4,631,423 13.00 524,040

3,4 Plan Amendment+Act Assump 1/1/1994 3,572,618 14.00 386,626

3 Plan Amendment 1/1/1995 2,563,039 15.00 266,543

4 Actuarial Assumption 1/1/1996 1,586,922 16.00 159,236

3 Plan Amendment 1/1/1996 13,409,252 16.00 1,345,523

3 Plan Amendment 1/1/1997 8,554,251 17.00 831,144

3 Plan Amendment 1/1/1998 9,470,512 18.00 893,747

4 Actuarial Assumption 1/1/1998 4,170,443 18.00 393,572

4 Actuarial Assumption 1/1/1999 382,137 19.00 35,122

3 Plan Amendment 1/1/1999 16,520,078 19.00 1,518,376

3 Plan Amendment 1/1/2000 6,262,620 20.00 561,942

4 Actuarial Assumption 1/1/2000 3,463,286 20.00 310,759

3 Plan Amendment 1/1/2001 10,351,321 21.00 908,708

3 Plan Amendment 1/1/2002 1,890,939 22.00 162,714

3 Plan Amendment 1/1/2003 2,532,028 23.00 213,933

1 Experience Loss 1/1/2003 5,997,116 8.00 945,524

1 Experience Loss 1/1/2004 12,867,341 9.00 1,861,090

1 Experience Loss 1/1/2005 7,657,581 10.00 1,028,346

3 Plan Amendment 1/1/2005 891,448 25.00 72,938

4 Actuarial Assumption 1/1/2005 947,219 25.00 77,502

1 Experience Loss 1/1/2006 4,375,589 11.00 550,865

3 Plan Amendment 1/1/2006 1,323,980 26.00 106,809

3 Plan Amendment 1/1/2007 1,361,633 27.00 108,429

3 Plan Amendment 1/1/2008 1,079,750 13.00 122,173

1 Experience Loss 1/1/2009 102,072,128 14.00 11,046,176

1 Experience Loss 1/1/2011 4,625,911 11.00 582,379

1 Experience Loss 1/1/2012 34,250,347 12.00 4,074,425

1 Experience Loss 1/1/2013 30,360,494 13.00 3,435,249

$ 316,757,687 $ 35,886,283

Type of Date Remaining

Base Description Established Balance Period Payment 

Credits 1 Experience Gain 1/1/2010 $ (21,176,635) 10.00 $ (2,843,835)

3 Plan Amendment 1/1/2010 (24,815,938) 10.00 (3,332,562)

1 Experience Gain 1/1/2014 (13,995,934) 14.00 (1,514,630)

1 Experience Gain 1/1/2015 (8,275,002) 15.00 (860,559)

$ (68,263,509) $ (8,551,586)

SCHEDULE OF FUNDING STANDARD ACCOUNT BASES 

Beginning Of Year

Beginning Of Year

Exhibit 16: Page 26 of 30
Attachment to: 2015 Schedule MB (Form 5500), Line 11 

Plan Name: Western States Office & Professional Employees Pension Fund 

Employer ID: 94-6076144 

Plan Number: 001 

JUSTIFICATION FOR CHANGE IN ACTUARIAL ASSUMPTIONS 

The current liability interest rate was changed from 3.64% to 3.51% to be within the permissible 

corridor under IRC Section 431 (c)(6)(E). Additionally, the current liability mortality table was 

updated in accordance with IRS Regulations 1.431(c)(6)-1 and 1.430(h)(3)-1. 

Exhibit 16: Page 27 of 30