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Milliman Actuarial Valuation

January 1, 2018 Actuarial Valuation 

Arizona Bricklayers’ Pension Trust Fund 

Arizona Bricklayers’ Pension Trust Fund

January 1, 2018 Actuarial Valuation

Prepared by:

Kevin Campe, EA, MAAA

Principal and Consulting Actuary

Grant Camp, FSA, EA, MAAA

Principal and Consulting Actuary

Milliman, Inc.

71 South Wacker Drive

31st Floor

Chicago, IL 60606

Tel +1 312 726 0677

Fax +1 312 726 5225

milliman.com

AZ BRK 000461






































Milliman Actuarial Valuation

Issued May 5, 2020

Arizona Bricklayers’ Pension Trust Fund

January 1, 2019 Actuarial Valuation

Prepared by:

Kevin Campe, EA, MAAA

Principal and Consulting Actuary

Grant Camp, FSA, EA, MAAA

Principal and Consulting Actuary

Milliman, Inc.

71 South Wacker Drive

31st Floor

Chicago, IL 60606

Tel +1 312 726 0677

Fax +1 312 726 5225

milliman.com

AZ BRK 000500









































Checklist Item #2 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include a description of the 

proposed benefit suspension – calculated as if no 

other limitations apply – that includes:

• the suspension’s effective date (and its 

expiration date, if applicable),

• whether the suspension provides for 

different treatment of participants and 

beneficiaries,

• a description of the different categories or 

groups of individuals affected, and

• how the suspension affects these 

individuals differently?

See section 2.02 of this revenue procedure.

A: Yes

The application filed on behalf of the Arizona 

Bricklayers’ Pension Trust Fund sets forth the 

following proposed benefit suspension to be effective

January 1, 2022:

• Maximum reduction in benefits to 110% of 

PBGC guaranteed benefits. 

No special groups would be treated different except 

those required by law:

• Disability based benefits will not be reduced;

• Participants or beneficiaries who are at least 

80 years of age on January 31, 2022, will have 

no reductions; and

• Participants or beneficiaries who are at least 

75 years of age on January 31, 2022, will have 

a smaller benefit reduction.

The proposed suspension will remain in effective 

indefinitely. 

AZ BRK 000542
Checklist Item #5 Application for Approval of a Suspension of Benefits 

Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include the plan 

actuary’s certification of critical and 

declining status and the supporting 

illustrations, including:

• the plan-year-by-plan-year 

projections demonstrating projected 

insolvency during the relevant 

period, and

• separately identifying the available 

resources (and the market value of 

assets and changes in cash flow) 

during each of those years?

See section 3.01 of this revenue 

procedure.

A: Yes

The application filed on behalf of the Arizona Bricklayers’ 

Pension Trust Fund includes an actuarial certification for the 

plan year beginning January 1, 2020 under IRC §432, which 

designates the Plan as meeting the “critical and declining” 

status for the plan year. The certification is attached as “2020 

Critical and Declining PPA Status Certification.” This 

document references the January 1, 2019 actuarial valuation 

which is also attached here as “2019 Actuarial Valuation 

Report”.

A supplemental report that includes additional disclosures 

required by §3.01 of Revenue Procedure 2017-43 is attached 

as “Report of Required Actuarial Information - Application 

for Proposed Benefit Suspensions as of January 1, 2022”.

AZ BRK 000543
Checklist Item #6 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include the plan 

actuary’s certification that, taking into 

account the proposed suspension and, if 

applicable, a proposed partition, the plan is 

projected to avoid insolvency if the 

suspension takes effect, and the supporting 

illustrations, including:

• the plan-year-by-plan-year 

projections demonstrating projected 

solvency during the relevant period,

• separately identifying the available 

resources (and the market value of 

assets and changes in cash flow) 

during each of those years? 

See section 3.02 of this revenue procedure.

A: Yes

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”

AZ BRK 000544
Checklist Item #8 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include a 

demonstration that the limitations on 

individual suspensions are satisfied, 

including a description of each benefit 

based on disability, as defined under the 

plan, that is paid to an individual under the 

plan (without regard to whether the 

disability benefits are available to newly 

disabled participants) and calculations 

regarding:

• the guarantee-based limitation,

• the disability-based limitation,

• the age-based limitation, taking into 

account the guarantee based 

limitation, and

• if applicable, the age based limitation 

taking into account both the 

guarantee-based limitation and the 

disability-based limitation?

See section 4.01 of this revenue procedure.

A: Yes

Demonstrations that the limitations on individual suspension 

are satisfied. There are 8 examples:

1. Individual currently receiving benefits below 110% 

PBGC Guarantee (including contingent beneficiary)

2. Individual currently receiving benefits reduced to 

110% PBGC Guarantee (including contingent 

beneficiary)

3. Individual currently receiving benefits between age 

75 and 80 (including contingent beneficiary)

4. Individual currently receiving benefits over age 80 

(including contingent beneficiary)

5. Individual currently receiving benefits based on 

disability (including contingent beneficiary)

6. Future retiree reduced to 110% PBGC Guarantee

7. Future retiree between age 75 and 80 

8. Future disabled retiree 

There are no future retirees below 110% of the PBGC 

Guarantee and there are no future retirees in the Plan who 

will be over age 80 as of January 31, 2022. 

AZ BRK 000545
Checklist Item #9 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include a 

demonstration that the proposed 

suspension is reasonably estimated to 

achieve the level necessary to avoid 

insolvency for the extended period, 

including illustrations regarding the plan’s 

solvency ratio and available resources? 

See section 4.01 of this revenue procedure.

A: Yes

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”

AZ BRK 000546
Checklist Item #11 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include a 

demonstration that the proposed 

suspension is not projected to materially 

exceed the level necessary to avoid 

insolvency, including:

• the plan-year-by-plan-year 

projections demonstrating projected 

insolvency during the relevant 

period, and

• a separate identification of the 

available resources (and the market 

value of assets and changes in cash 

flow) during each of those years? 

See section 4.03 of this revenue procedure.

A: Yes

N/A because this Plan is applying for a maximum 

suspension and partition. 

AZ BRK 000547
Checklist Item #12 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include a 

demonstration that the proposed 

suspension is equitably distributed, 

including:

• information on the effect of the 

suspension on the plan in the 

aggregate,

• information on the effect of the 

suspension for different categories or 

groups,

• a list of the factors taken into 

account,

• an explanation of why none of the 

factors listed in § 432(e)(9)(D)(vi) 

were taken into account (if 

applicable),

• for each factor taken into account 

that is not one of the factors listed in 

§ 432(e)(9)(D)(vi), an explanation 

why the factor is relevant, and

• an explanation of how any difference 

in treatment among categories or 

groups of individuals results from a 

reasonable application of the relevant 

factors? 

See section 4.04 of this revenue procedure.

A: Yes

In accordance with Section 432(e)(9)(D)(vi), the proposed 

benefit suspension is distributed in an equitable manner 

across the Plan’s participant and beneficiary population

because all benefits will be reduced to the maximum 

allowable under MPRA. 

See separate report for information on the effect of the 

suspension on the Plan participants in the aggregate as 

required per Section 4.04(1)(a) and (b)

AZ BRK 000548
Checklist Item #20 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application describe how the plan 

sponsor took into account - or did not take 

into account - in the determination that all 

reasonable measures have been taken to 

avoid insolvency, the impact of:

• benefit and contribution levels on 

retaining active participants and 

bargaining groups under the plan, 

and

• past and anticipated contribution 

increases under the plan on employer 

attrition and retention levels? 

See section 5.03 of this revenue procedure.

A: Yes

The Trustees determination that all reasonable measures 

have been taken to avoid insolvency includes the 

consideration of the Plan factors specified in Section 

432(e)(9)(C)(ii):

• Current and past contribution levels: 

The Plan consists of employers in the masonry 

industry, which declined significantly during the 

great recession and has not yet fully recovered. 

Eventual recovery remains uncertain. The 

significant decline in the industry caused a reduction 

in the number of employers and active participants 

in the Plan from 30 to 10 employers and 579 to 54

active participants from 2007 to 2019. This includes 

two large employers that left the Plan to continue as 

"non-union" employers. As a result, there are 

insufficient contributions to the Plan to sustain the 

plan at a healthy level as required by ERISA and the 

Code. See “Report of Required Actuarial 

Information - Application for Proposed Benefit 

Suspensions as of January 1, 2022” for a summary 

of past and current contribution levels over the most 

recent 10 years. 

• Levels of benefit accruals: 

The current benefit accrual level is $30 per month 

per year of service. This rate was reduced from $43 

effective for benefit accruals January 1, 2007 and 

after. The Board determined that further reducing 

the benefit accrual level and further eliminating 

adjustable benefits would leave very little incentive 

for participants to remain union employees and 

would therefore have a detrimental impact on the 

Plan’s future funding.

• Prior reductions of adjustable benefits: 

The benefit reductions in the Rehabilitation Plan 

include almost all adjustable benefit reductions.

• Prior suspension of benefits under Section 

432(e)(9): 

Not applicable as the Plan has not had a prior 

suspension of benefits under Section 432(e)(9).

AZ BRK 000549
• The impact on plan solvency of the subsidies and 

ancillary benefits available to active participants: 

As noted above, almost all adjustable benefits have 

been eliminated under the Rehabilitation Plan. 

• Compensation levels of active participants relative 

to employees in the participants’ industry generally

(see Application – OES data).

• Competitive and other economic factors facing 

contributing employers.

As noted above, the Plan consists of employers in 

the masonry industry, which declined significantly 

during the great recession and has not yet fully 

recovered. Additionally, two large employers 

withdrew to continue business as non-union 

employers.

• The impact of benefit and contribution levels on 

retaining active participants and bargaining groups 

under the plan.

During the implementation of the rehabilitation plan 

in 2016, the Board determined that even if all 

adjustable benefits were eliminated and future 

accrual rates were reduced to the 1.00% of 

contribution level, hourly contribution rates would 

need to increase by at least $3.85 per hour (from 

$0.90 to $4.75 per hour) over the ten-year 

Rehabilitation Period in order for the Plan to be able 

to emerge from critical status by the end of the 

Rehabilitation Period. The Board concluded that 

such contribution rate increases were unreasonable, 

would likely create a domino effect of the remaining 

employers going out of business and involved 

considerable risk to the Plan and Plan participants.

• The impact of past and anticipated contribution 

increases under the plan on employer attrition and 

retention levels.

As mentioned above, there are no further plans to 

increase the required contribution rate as that is 

anticipated to have a detrimental impact on the

Plan’s future funding. 

• Measures undertaken by the plan sponsor to retain 

or attract contributing employers.

The Trustees’ view is that having no future planned 

contribution rate increases is the only option to 

AZ BRK 000550
retain contributing employers without negatively 

impacting the Plan’s future funding.

AZ BRK 000551
Checklist Item #23 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application indicate whether the 

plan sponsor is requesting approval from 

PBGC of a proposed partition under 

section 4233 of ERISA? 

See section 6.02 of this revenue procedure.

A: Yes

The Trustees of the Arizona Bricklayers’ Pension Trust 

Fund have applied for a partition effective January 1, 2022. 

Under the proposed partition, the guaranteed amounts for 

188 terminated vested participants would be partitioned to 

the Successor Plan and paid for through financial assistance 

provided by the Pension Benefit Guaranty Corporation. Our 

analysis indicates that the level of financial assistance 

requested reasonably allows for the Plan to avoid 

insolvency.

AZ BRK 000552
Checklist Item #24 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

If the answer to item 23 is yes, does the 

application specify the effective date of the 

proposed partition and include a plan-yearby-plan-year projection of the amount of 

the reduction in benefit payments 

attributable to the partition?

See section 6.02 of this revenue procedure.

A: Yes

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”

AZ BRK 000553
Checklist Item #25 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include:

• a description of each of the 

assumptions used in the projections 

required under sections 3.01, 3.02, 

4.02(1), 4.02(2), and 4.03 of this 

revenue procedure,

• supporting evidence for the selection 

of those assumptions, and

• an explanation of any differences 

among the assumptions used for 

various purposes? 

See section 6.03 and Appendix B of this 

revenue procedure.

A: Yes

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”.

AZ BRK 000554
Checklist Item #26 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application describe the plan’s 

experience with certain critical 

assumptions, including a disclosure for 

each of the 10 plan years immediately 

preceding the application that separately 

identifies:

• the total contributions,

• the total contribution base units,

• the average contribution rates,

• the withdrawal liability payments, 

and

• the rate of return on plan assets? 

See section 6.04 of this revenue procedure.

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”.

AZ BRK 000555
Checklist Item #27 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include deterministic 

projections of the sensitivity of the plan’s 

solvency ratio throughout the extended 

period by taking into account the more 

conservative assumptions of investment 

experience and future contribution base 

units than assumed elsewhere in the 

application? 

See section 6.05 of this revenue procedure.

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”.

AZ BRK 000556
Checklist Item #28 Application for Approval of a Suspension of 

Benefits Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the plan include deterministic 

projections for each year in the extended 

period of:

• the value of plan assets

• the plan’s accrued liability, and

• the plan’s funded percentage?

See section 6.06 of this revenue procedure.

See report titled “Report of Required Actuarial Information -

Application for Proposed Benefit Suspensions as of January 

1, 2022”.

AZ BRK 000557
Checklist Item #35 Application for Approval of a Suspension of Benefits 

Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include the required 

enrolled actuary information?

See section 7.04 of this revenue 

procedure.

A: Yes

The following information is being provided for the 

application on behalf of the Arizona Bricklayers’ Pension 

Trust Fund:

Plan Actuary

Kevin Campe

Principal and Consulting Actuary

Enrolled Actuary No. 20-05356

Milliman, Inc.

71 South Wacker Drive, 31st Floor

Chicago, Illinois 60606

(312) 726-0677

AZ BRK 000558
Checklist Item #41 Application for Approval of a Suspension of Benefits 

Under MPRA

Arizona Bricklayers’ Pension Trust Fund

EIN: 34-6666753

Plan No.: 001

Does the application include the two most 

recent actuarial valuation reports? 

See section 7.10 of this revenue 

procedure.

A: Yes

Included as “2018 Actuarial Valuation Report” and “2019

Actuarial Valuation Report” are the January 1, 2018 and 

January 1, 2019 Actuarial Valuation Reports.

AZ BRK 000559