1 

CARPENTERS PENSION TRUST FUND – DETROIT & VICINITY

APPLICATION FOR APPROVAL OF SUSPENSION OF BENEFITS UNDER THE 

MULTIEMPLOYER PENSION REFORM ACT OF 2014

CHECKLIST

Response Item 

number

Description of item Page number

in 

application

Yes 1. Does the application include an original signature of the plan sponsor or an 

authorized representative of the plan sponsor? See section 2.01 of this revenue 

procedure.

CPTF-DV

000001

Yes 2. 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.

CPTF-DV

000002

Yes 3. Does the application include a penalties-of-perjury statement signed by an 

authorized trustee on behalf of the board of trustees? See Section 2.03 of

this revenue procedure.

CPTF-DV

000033

Yes 4. Does the application include a statement, signed by an authorized trustee on behalf 

of the board of trustees, acknowledging that the application and the application’s 

supporting material will be publicly disclosed on the

Treasury Department’s website? See section 2.04 of this revenue procedure.

CPTF-DV

000034

Yes 5. 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.

CPTF-DV

000040

Yes 6. 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.

CPTF-DV

000009

Yes 7. Does the application include the plan sponsor’s determination of projected

insolvency that includes the documentation set forth in section 5 of the 

revenue procedure? See section 3.03 of this revenue procedure.

CPTF-DV

000050
2 

Yes 8 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.

CPTF-DV

000050

Yes 9. 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 4.02(1) of this 

revenue procedure.

CPTF-DV

000071

Yes 10. Does the application include an illustration that the proposed suspension is 

reasonably estimated to achieve the level necessary to avoid insolvency for the 

extended period utilizing stochastic projections? (This illustration is optional if the 

plan is not required to appoint a retiree representativeunder

§ 432I(9)(B)(v)(I).) See section 4.02(2) of this revenue procedure.

CPTF-DV

000071

Yes 11. 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.

CPTF-DV

000075

Yes 12. 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€(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€(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.

CPTF-DV

000082

Yes 13. Does the application include a copy of the notices (excluding personally 

identifiable information) that meet the requirements under § 432€(9)(F)? See 

section 4.05(1) of this revenue procedure.

CPTF-DV

000099,

000105
3 

Yes 14. Does the application include a description of the efforts that are being taken 

to contact participants, beneficiaries in pay status, and alternate payees? See 

section 4.05(2) of this revenue procedure.

CPTF-DV

000023

Yes 15. Does the application describe the steps the plan sponsor has taken to ensure 

that notices delivered electronically are reasonably accessible to the recipients? 

See section 4.05(3) of this revenue procedure.

CPTF-DV

000023

Yes 16. Does the application include a list of each employer who has an obligation to 

contribute under the plan and each employee organization representing participants 

under the plan? See section 4.05(4) of this revenue

procedure.

CPTF-DV

000023,

000154

Yes 17. Does the application include information on past and current measures taken to 

avoid insolvency? See section 5.01 of this revenue procedure. CPTF-DV

000024

Yes 18. Does the application include information regarding the plan factors described in § 

432©(9)©(ii), for the past 10 plan years immediately preceding the plan year in 

which the application is submitted? See section

5.02 of this revenue procedure.

CPTF-DV

000024

Yes 19. Does the application describe how the plan sponsor took into account – or did not 

take into account – the factors listed in section 5.02 of this revenue

procedure in the determination that all reasonable measures were taken to avoid 

insolvency? See section 5.03 of this revenue procedure.

CPTF-DV

000024

Yes 20. 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 activeparticipants 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.

CPTF-DV

000011,

000024

Yes 21. Does the application include a discussion of any other factors the plan sponsor 

took into account including how and why those factors were taken into account? 

See section 5.04 of this revenue procedure.

CPTF-DV

000011,

000024

Yes 22. Does the application include a copy of the proposed ballot, excluding the 

information regarding the statement in opposition, the individualized estimate, 

and the voting procedures? See section 6.01 of this revenue

procedure.

CPTF-DV

000174

N/A 23. 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.

CPTF-DV

000024

N/A 24. If the answer to item 23 is yes, does the application specify the effective date of 

the proposed partition and include a plan-year-by-plan-year projection of the 

amount of the reduction in benefit payments attributable to the partition? See 

section 6.02 of this revenue procedure.

N/A
4 

Yes 25. 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.

CPTF-DV

000181,

000208,

000218

Yes 26. 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.

CPTF-DV

000225

Yes 27. 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.

CPTF-DV

000226

Yes 28. 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.

CPTF-DV

000235

Yes 29. Does the application include the plan sponsor’s representation that, if it 

receives the Treasury Department’s final authorization to suspend and then 

chooses to implement the suspension, it will also amend the plan:

• to provide that the suspension will cease upon the plan sponsor’s failure 

to maintain a written record of its annual determinationthat

(i) all reasonable measures continue to be taken to avoid 

insolvency and (ii) the plan would not be projected to avoid 

insolvency without a suspension,

• to require that any future benefit improvements must satisfy

§ 432€(9)€, and

• to specify that the plan sponsor will not modify these amendments, 

notwithstanding any other provision of the plan document?

See section 6.07 of this revenue procedure.

CPTF-DV

000237

N/A 30. Does the application indicate whether the plan is a plan described in

§ 432€(9)(D)(vii) and, if it is, how that is reflected in the proposed benefit 

suspension? See section 6.08.

CPTF-DV

000029

Yes 31 Does the application include a narrative statement of the reasons the plan is in 

critical and declining status?

See section 6.09.

CPTF-DV

000238

Yes 32. Does the application include the required plan sponsor identification and 

contact information? See section 7.01 of this revenue procedure. CPTF-DV

000029
5 

Yes 33. Does the application include the required plan identification information? See 

section 7.02 of this revenue procedure. CPTF-DV

000030

Yes 34. Does the application include the required retiree representative information (if 

applicable)? See section 7.03 of this revenue procedure. CPTF-DV

000030,

000250

Yes 35. Does the application include the required enrolled actuary information? See 

section 7.04 of this revenue procedure. CPTF-DV

000030

Yes 36. Does the application include a designation of power of attorney for each authorized 

representative who will represent the plan sponsor in

connection with the application? See section 7.05 and Appendix C of this revenue 

procedure.

CPTF-DV

000251

Yes 37. Does the application include:

• the required plan documents

• any recent amendments

• the summary plan description (SPD)

• any summary of material modifications, and

• the most recent determination letter? 

See section 7.06 of this revenue procedure.

CPTF-DV

000252 – 

000392

Yes 38. Does the application include the required excerpts from the relevant collective 

bargaining agreements and side agreements? See section 7.07

of this revenue procedure.

CPTF-DV

000393 – 

000685

Yes 39. Does the application include the required excerpts from the most recently filed 

Form 5500? See section 7.08 of this revenue procedure. CPTF-DV

000686 – 

000685

Yes 40. Does the application include the most recently updated rehabilitation plan? See 

section 7.09 of this revenue procedure. CPTF-DV

000728

Yes 41 Does the application include the two most recent actuarial valuation 

reports? See section 7.10 of this revenue procedure. CPTF-DV

000733 – 

000890

Yes 42. Does the application include this checklist, completed and placed on top of the 

application? See section 7.11 of this revenue procedure and this

Appendix D.

0 
6 

N/A 43. If the application is being submitted for resubmission review, does the 

application include:

• cross-references to information in the prior application with 

respect to information that has not changed from the prior 

application,

• a statement that the application is being submitted for 

resubmission review, and

• the date on which the Treasury Department indicated that the 

application is a candidate for resubmission review?

See section 8 of this revenue procedure.

N/A
7 

CARPENTERS PENSION TRUST FUND – DETROIT & VICINITY

APPLICATION FOR APPROVAL OF SUSPENSION OF BENEFITS UNDER THE 

MULTIEMPLOYER PENSION REFORM ACT OF 2014

TABLE OF EXHIBITS

Exhibit Number Description

 Completed Checklist

 

 Cover Letter

 Application

1 Penalty of Perjury Statement; Acknowledgement of Public Nature of Filing

2 Actuary’s Certification of Critical and Declining Status

3 Actuary’s Certification that Plan Will Avoid Insolvency

4 Demonstration that Limitations of Individual Suspensions are Satisfied

5 Stochastic Illustration the Proposed Suspension Avoids Insolvency

6 Demonstration that Proposed Suspension Does Not Materially Exceed the Level Necessary

7 Demonstration that Proposed Suspension is Equitably Distributed

8A General Notice

8B Individual Notice Templates

9 List of Contributing Employers

10 Proposed Ballot

11 Description of Assumptions Used in Projections

12A 20-Year Forecast Employment Research Corporation 

12B Wage Data

13 10-Year Experience for Certain Critical Assumptions

14 Deterministic Projection of Solvency Ratio

15 Deterministic Projections for Assets Liabilities and Funded Percentage

16 Plan Sponsor’s Representation Regarding Plan Amendments

17 Narrative Statement

18 Retiree Representative Appointment Letter

19 Designation of Power of Attorney

20 Plan Document
8 

Exhibit Number Description

21 Plan Amendments 1 – 8 

22 Plan SPD Dec 2017

23 Summary of Material Modifications 

24 Determination Letter

25 Required Excerpts from Relevant Collective Bargaining Agreements Part 1

25 Required Excerpts from Relevant Collective Bargaining Agreements Part 2 

26 Form 5500 Page 1 and 2 and Schedule R

26 Form 5500 Schedule MB and Exhibits

27 Most Recently Updated Rehabilitation Plan

28 2017 Actuarial Valuation Report

29 2018 Actuarial Valuation Report

Addendum Actuary’s Checklist Items 
The Hon. Steven T. Mnuchin 

Secretary of the Treasury 

Department of the Treasury 

1500 Pennsylvania Avenue, W 

Washington, DC 20220 

Re: Carpenters Pension Trust Fund - Detroit & Vicinity 

Application for Suspension of Benefits Under the Multi employer 

Pension Reform Act of 2014 

Dear Secretary Mnuchin: 

The Board of Trustees of the Carpenters Pension Trust Fund - Detroit & Vicinity as the 

Plan Sponsor respectfully submits this application for approval of a proposed suspension of 

benefits pursuant to Internal Revenue Code Section 432(e)(9) and Section 305(e)(9) of the 

Employee Retirement Income Security Act of 1974. The Board hereby confinns that it has 

designated its Chairman, Mr. Tom Lutz and its Secretary, Mr. Robert Halik, as its Authorized 

Representative Trustees for the purpose of executing all documents necessary for the application. 

Signed: September _l9_, 2019 

"-~-.l:l65 

CPTF-DV000001 

1400 
CARPENTERS PENSION TRUST FUND – DETROIT & VICINITY

________________________________________________ 

APPLICATION FOR APPROVAL OF

SUSPENSION OF BENEFITS

UNDER THE

MULTIEMPLOYER PENSION REFORM ACT OF 2014 

________________________________________________ 

SEPTEMBER 23, 2019 

NOVARA, TESIJA & CATENACCI, PLLC

CPTF-DV000002
SECTION 1. BACKGROUND AND PROCEDURE

The Board of Trustees of the Carpenters Pension Trust Fund – Detroit & Vicinity (the 

“Plan”) submits this application and the accompanying Exhibits to the Secretary of the Treasury 

for approval of a proposed suspension of benefits. The application is made pursuant to Internal 

Revenue Procedure 2017-43 (the “Revenue Procedure”) and the Department of the Treasury’s 

final regulations issued under § 432(e)(9) of the Internal Revenue Code of 1986, as amended, (the 

“Code”) as published in the Federal Register on April 28, 2016 (the “Regulations”). 

Under §432(e)(9)(G) of the Code the Secretary of the Treasury shall approve an application 

for the approval of suspension of benefits upon finding that the Plan is eligible and has satisfied 

the criteria of subparagraphs (C), (D), (E) and (F) of §432(e)(9) of the Code. As set out in detail 

below, the Plan is eligible to suspend benefits and has satisfied each of the criteria under the Code 

and the Regulations. 

SECTION 2. APPLICATION PROCEDURES

2.01 Application submitted by plan sponsor. 

This Application for Approval of Suspension of Benefits under the Multiemployer Pension 

Reform Act of 2014 (Application) is submitted by the Plan Sponsor, as defined at §432(j)(9) of 

the Code, as required under the Regulations. The Application is signed by the current Chairman 

and Secretary of the Board of Trustees of the Plan who are so authorized under the Plan’s 

agreement and declaration of trust and the letter of authorization executed by the full Board of 

Trustees for purposes of the Application. 

2.02 Term of the plan’s proposed suspension of benefits. 

(1) Effective date. 

The Trustees of the Plan propose that the suspension be effective (the “Effective Date”), 

after the application has been approved and the result of the participant vote has been determined, 

on July 1, 2020. 

(2) Expiration date. 

The proposed suspension shall remain in effect indefinitely. It will not expire by its own 

terms. 

(3) The proposed suspension. 

An explanation of the Plan’s historical benefit formula is required for the Plan’s proposed 

suspension design to be fully described. 

Historical Benefit Formula

Generally, the accrued benefit for a participant who terminated Active Participant status 

prior to May 1, 2004 is determined from the following table: 

CPTF-DV000003
Plan Year of 

Termination 

Starting May 1, Formula

<=1976 2.75% of contributions, but not less than $35 per month or more than $650 

per month*

1977-1978 2.75% of contributions, but not less than $35 per month or more than $800 

per month*

1979 

2.75% of the first $15,000 of contributions plus 3% of contributions in 

excess of $15,000, but not less $35 per month or more than $900 per 

month*

1980-1983 2.6% of contributions*

1984 2.9% of contributions*

1985 3.2% of contributions*

1986 3.4% (3.2% for PYB < 1985) of contributions

1987-1988 3.6% (3.4% for PYB < 1985) of contributions

1989 3.7% (3.4% for PYB < 1985) of contributions

1990-1991 3.85% of contributions

1992-1996 3.9% of contributions

1997-2003 4.3% of contributions

* Not less than 3.5% of the first $4,300 of total contributions plus 1.5% of the remaining 

contributions if participant on 4/30/1969 

A participant who terminated or terminates Active Participant status on or after May 1, 

2004 will have his or her benefit determined as follows: 

• 4.3% of contributions made or required to be made prior 5/1/2004, plus 

• 3% of credited contributions made or required to be made from and after 5/1/2004 but prior 

to 5/31/2007 (77.5% - 78% of contributions related to work performed from 6/1/2006 

through 4/30/2007 is credited), plus 

• 1% of credited contributions made or required to be made from and after 5/1/2007 (between 

84% and 39% of contributions related to work performed during this period is credited). 

Description of Proposed Suspension

The proposed benefit suspension shall be accomplished by recalculating all accrued 

benefits and, for benefits that are in pay status, recalculating such benefit from the revised accrued 

benefit both based on each participant’s applicable group, but limited as required by the Code and 

Final Regulation.

First, the participant population is divided into 2 groups: “active/retiree” and “deferred 

vested.” These groups are defined as follows: 

• Active/Retiree – either:

CPTF-DV000004
o Worked at least one hour in plan year ended 4/30/2018 or 4/30/2019 (must have 

previously met initial participation by working at least 870 hours total over a 2-

plan-year period); or 

o Is in pay status as a retiree, disabled retiree, beneficiary or alternate payee as of 

5/1/2019; or 

o Is a beneficiary of a participant who was an Active Participant at death and is 

entitled to a future benefit. 

• Deferred Vested – Is a partially or fully vested participant (or his or her beneficiary or 

alternate payee) who did not satisfy the Active Participant hours requirement and is not in 

pay status or otherwise did not meet the Active/Retiree requirements.

The proposed suspension treats un-retired deferred vested participants differently from 

already retired deferred vested participants, and does so equitably, as follows.

All retirees (except those exempted by the statute) will be subject to the same 16% benefit 

suspension level. Suspension plan design intentionally makes no distinction between active and 

vested deferred retirees. 

Several important considerations support the different treatment of currently retired 

deferred vested participants and unretired deferred vested participants. One is data driven. The 

Plan’s third-party administrator’s record keeping system does not separately code those that were 

active versus those who were deferred vested after they enter pay status. The Plan has almost 

10,000 retirees, and it now would be difficult and costly to separately track deferred vested retirees 

and normal and early retirees. Separating the two retiree populations will require significant time 

and expense, because of the need to retrieve from storage and separately, manually review the 

physical file of each retiree.

Second, there is a compelling fairness argument that supports subjecting all current retirees 

to the same level of benefit suspension. Deferred vested retirees’ benefits generally are subject to 

more significant actuarial reduction on account of early start. By plan design, vested deferred 

participants retirement benefits are subject to actuarial reduction from age 65 for early start using 

less favorable reduction factors (active participants’ benefits are unreduced at age 62 retirement 

and subject to more favorable reduction factors). Additionally, deferred vested retirees were not 

eligible for certain pre-retirement plan benefits, like disability retirement benefits. Finally, past 

benefit multiplier improvements were only applied retroactively to those participants who were 

then active – not to deferred vested participants. Consequent, deferred vested retirees tended to 

receive a lower benefit amount upon retirement, compared to active participants. 

Third, a deferred vested retiree already had “locked in” this lower benefit rate upon 

retirement and can take no steps to improve his or her benefit level – he could not return to covered 

employment after retirement under the Plan’s suspension of benefit rules (for more than 39 hours 

per month) and, until the last several years, the decline and seasonality of the Southeast Michigan 

unionized carpentry industry made return for even short periods of covered work difficult or 

impossible. 

Fourth, retirees, even deferred vested retirees, have reliance issues that suggest moderating 

the impact of the suspension on their benefits. Most of these persons are older and likely have been 

CPTF-DV000005
out of the trade for many years. The unionized construction industry is dynamic and new 

techniques and technologies are continually adopted to try to help union contractors compete with 

their lower labor cost non-unionized competitors. Carpenters and specialty trades people who have 

been out of the trade for several years have not had the benefit of either “on-the-job” learning or 

fringe-benefit fund provided journeyman upgrade training to master these techniques and 

technologies. This knowledge/skill gap has been and is a significant barrier to retirees returning to 

the trade, assuming that they could perform such physically demanding work even if it was 

permitted, after several years and becomes a more formidable barrier as time goes on, especially 

to deferred vested retirees.

Contrast that skill gap to a deferred vested participant who has not yet retired and who 

continued to work in the trade in non-bargaining unit work (or covered work for non-contributing 

employers) or who could still return to covered employment under the Plan’s generous 

reinstatement provision (accrue at least 870 over two plan years) and augment his/her retirement

benefit level at the same accrual rate as is provided to active participants. 

As a matter of fairness, deferred vested retirees, with their generally lower benefit rates, 

more significantly reduced pre-age 65 retirement benefits and historically locked in benefit 

multipliers, were not subjected to the 26% benefit suspension rate, but rather to the same 16% 

suspension rate to be imposed on active retirees. For all classes of participants - active, retired, or 

vested deferred - the monthly benefit generated by the 1% multiplier will not be subject to any 

benefit suspension. 

Second, the suspension formula is applied based on the individual’s class as defined above. 

• Active/Retiree - The accrued benefit earned prior to 5/1/2007 will be reduced by 16%. Any 

accrued benefit earned under the 1% multiplier will be unchanged. 

• Deferred Vested - The accrued benefit earned prior to 5/1/2007 will be reduced by 26%. 

Any accrued benefit earned under the 1% multiplier will be unchanged. 

Retirees Who Entered Pay Status between 9/1/2008 and 7/31/2013 

As an adjustable benefit cut implemented as part of the Plan’s rehabilitation plan under the 

Pension Protection Act of 2006 (PPA), Plan early retirement reduction factors were changed 

effective August 1, 2013 and applied to any participant who retired on or after September 1, 2008. 

As a result, all participants who retired before age 62 and entered pay status between September 

1, 2008 and July 31, 2013 had their benefits recalculated as if the new factors had been in place 

when they originally retired. No retiree’s benefit was reduced by more than 5%. 

 Post-suspension benefits for this group will be determined using the early retirement 

reduction factors in effect when the participant initially retired. However, no benefit will be 

increased as a result of the suspension. 

Disability-Based Limitation 

CPTF-DV000006
The individual limitations will be applied as required by the Code. However, there are 

some special circumstances related to the application of the disability-based limitation. These are 

described below:

• When the Plan disability rules were changed in 2013, disabled retirees without a Social 

Security award were allowed one year to obtain such award. Some previously disabled 

participants ceased to qualify for disability retirement benefits under the Plan as a result of 

this change. These participants will not receive any special protection under the Code 

disability-based limitation.

• A class action lawsuit was filed challenging the Plan’s amended disability benefit, which 

was settled in October 2016. Under that settlement, most disabled participants who were 

in pay status as of 8/1/2013 and had taken a cut due to the 2013 Plan amendment, were 

restored to 95% of their pre-amendment disability benefit amount. After these participants

retire, the disability-based limitation will be applied based on the 95% of pre-amendment 

disability amount. 

• The 2016 class action settlement requires that the affected disabled participants who were:

o In pay status on 8/1/2013, and 

o Converted to early retirement prior to October 2016 and

o Had an early retirement benefit that was less than 95% of their prior disability 

benefit,

be granted a benefit increase to 95% of their pre-amendment disability amounts payable 

until age 62, at which time their benefit will increase to an unreduced, early retirement 

benefit. For purposes of the disability-based limitation, the benefit payable until normal 

retirement age for these participants will be treated as a disability benefit.

• Separate interest alternate payees will generally not receive any portion of the disabilitybased limitation. But alternate payees who were assigned a portion of a participant’s 

disability benefit will receive a disability-based limitation based on the portion of disability 

benefit assigned and the participants will not receive a disability-based limitation based on 

such portion. 

• Shared interest alternate payees’ disability-based limitation, if any, will be divided in the 

same manner as the benefit itself.

• Surviving spouses and beneficiaries will not receive any disability-based limitation.

How the Proposed Suspension Affects Various Groups of Participants – Main Groups 

Below is a list of the various participant groups that are treated differently under the 

suspension and a description of how each group is treated differently. The groups are designated 

by the letters A through E.

Group Description How Treated Differently

CPTF-DV000007
A Active

Active participants will be subject to the 16% cut level on pre5/1/2007 accruals. Since they are continuing to accrue benefits, 

the effect of any cut relative to the final accrued benefit at 

retirement will become less as time passes

B Deferred 

Vested

The deferred vested participant group is the only group that is 

subject to the higher cut level of 26% of pre-5/1/2007 accruals

C 

Retiree with 

8/1/2013 

Benefit 

Reduction 

As described above, the benefits of the retirees in this group were 

reduced to reflect a new set of early retirement factors effective 

8/1/2013 (though the reduction was limited to 5% of the benefit in 

pay status immediately prior to 8/1/2013). This group is subject to 

the 16% cut level on pre-5/1/2007 accruals, but the early 

retirement factors used for determining the post-suspension benefit 

in pay status will be the factors that were in effect when they 

initially retired. Thus, the reduction will be slightly less relative to 

the benefit in effect immediately prior to suspension when 

compared to a similarly-situated retiree who did not experience the 

8/1/2013 benefit adjustment.

D 

Beneficiary of 

October 2016 

Disability 

Lawsuit 

Settlement

This group is subject to the 16% cut level on pre-5/1/2007 

accruals. However, as described above, the disability-based 

limitations are applied differently to this group as compared to a 

similarly-situated disabled or retired participant who was not a 

beneficiary of the lawsuit settlement.

E 

Pay Status 

Participant Not 

In Groups C or 

D

This group is subject to the 16% cut level on pre-5/1/2007 

accruals, but does not receive the benefit of any of the special rules 

applicable to groups C and D. 

How Suspension Affects Various Groups of Participants – Sub-groups 

Because the proposed suspension does not affect any benefits accrued on or after May 1, 

2007 (those that accrued under the 1% multiplier), each of preceding groups must be sub-divided 

into 3 parts: 

• Those with only accruals prior to May 1, 2007; 

• Those with only accruals on or after May 1, 2007; and 

• Those with accruals both before and after May 1, 2007. 

 These 3 sub-groups are labeled 1, 2, and 3. The way in which each sub-group is treated 

differently is described below: 

SubGroupDescription How Treated Differently

1 Pre-5/1/2007 

Accruals Only

The 16% (26% in the case of deferred vested participants) 

reduction will apply to the entire accrued benefit

2 Post-5/1/2007 

Accruals Only

As there are no pre-5/1/2007 accruals, the accrued benefit will be 

unaffected by the suspension

CPTF-DV000008
3 

Pre- And Post5/1/2007 

Accruals

The 16% (26% in the case of deferred vested participants) 

reduction will only apply to the portion of the benefit accrued prior 

to 5/1/2007. Therefore, the overall reduction will be less than 16% 

(or 26%).

Final Groups

Final groups are referred to by starting with the letter representing the participant’s main 

group and appending the number representing the appropriate sub-group. For example, “A1,” 

“A2,” etc.

The final groups are summarized below (note that a few of the final groups do not contain 

any participants):

Group Description

A1 Active, pre-5/1/2007 accruals only

A2 Active, post-5/1/2007 accruals only

A3 Active, pre- and post-5/1/2007 accruals

B1 Deferred vested, pre-5/1/2007 accruals only

B2 Deferred vested, post-5/1/2007 accruals only

B3 Deferred vested, pre- and post-5/1/2007 accruals

C1 Retiree with benefit reduction effective 8/1/2013, pre-5/1/2007 accruals only

C2 Retiree with benefit reduction effective 8/1/2013, post-5/1/2007 accruals only

C3 Retiree with benefit reduction effective 8/1/2013, pre- and post-5/1/2007 accruals

D1 Beneficiary of the October 2016 disability lawsuit settlement, pre-5/1/2007 accruals 

only

D2 Beneficiary of the October 2016 disability lawsuit settlement, post-5/1/2007 accruals 

only

D3 Beneficiary of the October 2016 disability lawsuit settlement, pre- and post-5/1/2007 

accruals

E1 Retiree not included in a C or D group, pre-5/1/2007 accruals only

E2 Retiree not included in a C or D group, post-5/1/2007 accruals only

E3 Retiree not included in a C or D group, pre- and post-5/1/2007 accruals

Note: In the table above, “retiree” includes beneficiaries and alternate payees. 

2.03 Penalties of perjury statement. See, Application Exhibit 1. 

2.04 Public disclosure statement. See, Application Exhibit 1.

SECTION 3. DEMONSTRATION THAT THE PLAN IS ELIGIBLE FOR SUSPENSION

3.01 Plan actuary’s certification of critical and declining status. 

The Plan actuary’s required certification (issued July 29, 2019) is found at Application 

Exhibit 2 to the Application as required under Code §432(b)(3)(A). The Plan is certified as being 

CPTF-DV000009

I I - I - I 
in critical and declining status for the Plan Year beginning May 1, 2019. The certification is 

supported by the May 1, 2018 actuarial valuation report (issued February 4, 2019, and found at 

Application Exhibit 29) and the actuary’s supporting illustrations attached to the required 

certification which include a year-by-year projection of the Plan’s available resources and the 

benefits under the Plan demonstrating that the Plan is projected to become insolvent during the 

Plan Year ending April 30, 2035. The certification includes descriptions of the assumptions and 

methods applied, with reference to further detail in the May 1, 2018, actuarial valuation report. 

The year-by-year projection (Internal Exhibit I) separately identifies (items 1 and 7 respectively) 

the market value of assets as of the beginning and end of the Plan Years ending April 30, 2019, 

through April 30, 2035, and the following cash-flow items for those years: (2) employer 

contributions, (3) withdrawal liability payments, (4) benefit payments (further broken down by 

type at Internal Exhibit II), (5) expenses, and (6) investment income. Additionally, the supporting 

illustrations include projected total contribution base units and average contribution rates (Internal 

Exhibit III) for the period from Plan Year ending April 30, 2019, through April 30, 2035. 

3.02 Plan actuary’s certification that the plan is projected to avoid insolvency. 

Application Exhibit 3 is the Plan actuary’s certification that the Plan is projected to avoid 

insolvency. This certification includes the following supporting exhibits: Internal Exhibit I - 

Value of Plan Assets at the Beginning and End of the “Initial Period”; Internal Exhibit II - 

Deterministic Projection of Current Plan without Proposed Suspension; Internal Exhibit III – 

Deterministic Projection with Proposed Suspension; Internal Exhibit IV – Breakdown of Benefit 

Payouts for Exhibit I; and Internal Exhibit V – Breakdown of Benefit Payments for Exhibit II.

The certification and supporting exhibits satisfy the requirements of Code §432(e)(9)(C)(i) by 

providing a year-by-year projection demonstrating that, with the proposed suspension taking effect 

on July 1, 2020, the Plan is projected to avoid insolvency within the meaning of Code § 418E. The 

supporting exhibits also separately identify the available resources during each year and the market 

value of assets and changes in cash flow.

 

3.03 Plan sponsor’s determination of projected insolvency. 

The Trustees of the Plan have made a prudent determination under Code §432(e)(9)(C)(ii), 

after consideration of all of the available information and all remaining possible Plan changes, that 

the Plan is projected to become insolvent unless benefits are suspended as proposed in the 

Application. The Trustees have determined this to be so even though they have taken all reasonable 

measures to avoid insolvency. The Trustees’ determination of projected insolvency includes 

consideration of all of the measures taken to avoid insolvency over the past 10 plan years, as 

discussed in Section 3.04 of this Application. 

The funded status of the Plan had declined precipitously by plan year ending 2003, at which 

time, having experienced three consecutive years of negative returns, the Plan was 66% funded (in 

years 2002, 2001, and 2000 the Plan was 83%, 100% and 117% funded respectively). Faced with 

a deteriorating funded status and observing the growing “maturity” of the Plan’s participant 

population the Trustees took reasonable corrective actions available to them consistent with prePPA ERISA and the Code. Detail on the Trustees’ action is found in Section 3.04 of this 

Application, Consideration of Specific Plan Factors. 

CPTF-DV000010
In addition to the pre-PPA actions available to them, once the Plan was determined by its 

actuary to be in critical status in the initial PPA status certification (2008 certification, funded 

percentage 55%) the Trustees adopted a Rehabilitation Plan as of September 27, 2008. From this 

point forward the Trustees made ample use of the additional tools available to them under the 

PPA to (a) reduce accruals of future benefits by reducing the monthly benefit multiplier, (b) further 

reduce future benefit accruals by “discounting” a portion of contributions so that the discounted 

portion was not benefit bearing, (c) imposing contribution schedules on the Plan’s contributing 

employers that included increases in hourly rates and also defining the discounted portion of those 

increases. While the non-benefit bearing portion of the contribution increases imposed under the 

Plan’s original and subsequently amended rehabilitation plans and August 1, 2013 all-reasonablemeasures (“ARM”) plan are variously referred to as “credited/non-credited” (rehabilitation plan), 

and “discounted contributions” (See, Application Exhibit 29 May 1, 2018, Actuarial Valuation 

Report, at p. A-3) the terminology is interchangeable. The history of the Plan’s imposition of 

uncredited contributions is summarized in the Sixth Amendment to the current Plan. See, 

Application Exhibit 21 as follows: 

Contract

“Discount” by Time Period

6/1/06

to

5/30/07

6/1/07

to

5/30/08

6/1/08

to

5/30/09

6/1/09

to

5/30/10

6/1/10

to

5/30/11

6/1/11

to

5/30/12*

6/1/12

to

5/30/13

6/1/13

and 

Thereafter

Commercial 22% 16% 23% 37% 45% 52% 56.75% 61% 

Display 22% 16% 23% 37% 45% 52% 56.75% 61% 

Floorlayers 221⁄2% 16.5% 28% 42% 51% 56% 60.75% 61% 

Millmen 22% 35% 45% 45% 50% 50% 55.00% 61%

Millwrights 23% 17% 231⁄2% 371⁄2% 46% 52% 57.50% 61% 

Liberty 

Fabricating

23% 17% 231⁄2% 371⁄2% 46% 52% 57.50% 20%

Roadbuilders 23% 17% 231⁄2% 371⁄2% 46% 53% 57.75% 61%

All Others 22% 35% 45% 45% 50% 50% 55.00% 61%

Residential 22% 35% 45% 45% 50% 50% 55.00% 61%

Poured Wall 22% 35% 45% 45% 50% 50% 55.00% 61%

*No maximum non-credited contribution is in effect for benefits accrued on or after June 1, 2011. 

In addition to increasing contributions under rehabilitation and ARM plan schedules and 

limiting the amount of those increases that could be benefit bearing, the Trustees eliminated certain

“adjustable benefits” as defined under the PPA, consistent with the Plan’s rehabilitation and ARM

plans. Further discussion of actions taken to eliminate adjustable benefits is included in Section 

3.04(c) of this Application. 

Like virtually all multiemployer plans, the Plan suffered a sharp decline in contribution 

hours following the market collapse of August 2008. Hours, which had exceeded 14 million per 

year in the early 2000’s, bottomed out at about 5.8 million in plan year ended 2010. The decline 

in hours was much more severe, and the recovery much slower, than Trustees had predicted. 

In the years following 2010, work hours started to increase (though not as quickly as then

forecast) and it was thought that this trend would continue into the future. Based on these 

projections of continued improvement, the actions taken as described here and in other parts of 

this Application were expected, at the time they were adopted, to provide a viable path forward 

avoiding insolvency and restoring Plan financial health. 

CPTF-DV000011
Beginning in 2017, the Trustees observed that many of the large construction projects that 

had been fueling the recovery were going to end with no source of replacement hours on the 

horizon. This situation, combined with state-level legislative changes (“right to work” and a repeal 

of the requirement for project labor agreements (“PLAs”) on state-funded projects), and a dramatic 

scale-back of the Detroit Auto Show, caused the Trustees to change their outlook. They now saw 

a temporary peak followed by a decline in hours to about 7 million per year. The actuary projected 

that this new level of hours (approximately half of the levels seen in the early 2000’s) would not 

be sufficient to support the Plan as currently in effect. 

 Notwithstanding the actions taken as described here and in other parts of this Application, 

the Plan’s funded status has continued to decline. As reported in the 2018 actuarial PPA status 

certification, the Plan’s 2018 PPA funded ratio is 34.5% with a projected year of insolvency of 

2035. The Trustees have now reasonably and prudently determined that notwithstanding their past 

and possible future actions, the Plan cannot be projected to avoid insolvency if the proposed 

suspension of benefits is not approved and applied to the Plan. 

3.04 Consideration of Specific Plan Factors. 

(1) The 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)

for the 10 plan years immediately preceding 2019. 

(a) Current and past contribution levels. 

Beginning in 2006, the bargaining parties began making consistent contribution rate 

increases in an attempt to improve the Plan’s funding. These increases were typically noncredited/non-benefit bearing. During the period 2006-2014, the average hourly contribution rate 

increased from about $4 to over $15, and the percentage credited dropped from 100% to about 

39%. See, Application Exhibit 13 Pension Plan’s Ten-Year Experience for Certain Critical 

Assumptions which documents the Plan’s contribution rates from plan year ending April 30, 2010 

(average hourly rate $8.88) to April 30, 2019 (average hourly rate $14.37), and noting that for the 

plan year ending April 30, 2018 the average hourly rate was $15.05. 

As noted in Section 3.03 of this Application, the Trustees voted on August 1, 2013 to adopt 

the “all reasonable measures” option under the PPA. Since that time there have been no negotiated

contribution increases (though the average contribution rate does fluctuate based on the changing 

distribution of work among the various collective bargaining agreements). 

The Trustees and bargaining parties believe that the high contribution rate coupled with a 

low accrual rate (see, subsection (b) immediately below) make it difficult to attract and retain 

quality workers and to add new contributing employers to the Plan. This is because the high 

contribution rates make it difficult for contractors to compete in the construction project bidding 

process. Therefore, the Trustees believe that future contribution rate increases would be 

detrimental to the Plan.

(b) Levels of benefit accruals including any prior reductions in the rate of benefit 

accruals. 

CPTF-DV000012
 In 2004 the Plan’s monthly benefit multiplier was reduced from 4.3% to 3.0% of 

contributions. In 2007, the monthly benefit multiplier was reduced to 1%, although that figure 

itself is effectively reduced to 0.39% by virtue of the non-credited contribution rates shown in 

the table reproduced at Section 3.03 of this Application. 

(c) Prior reductions of adjustable benefits under Section 432(e)(8). 

 

The benefit reductions in the Plan’s rehabilitation plan include substantially all permissible 

adjustable benefit reductions and all reasonable benefit reductions. In 2013 the Plan’s ARM plan 

raised the unreduced early retirement from index 85 to age 62, regardless of service. 

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

 

This factor is not applicable as the Plan has not had a prior suspension of benefits under 

Section 432(e)(9). 

(e) Measures taken to retain or attract contributing employers. 

At present, any current or prospective contributing employer is faced with participation in 

a Plan that is projected to become insolvent, that imposes a substantial contribution rate, and for 

which new participants will accrue (functionally less than) a 1% future Plan benefit 

notwithstanding the past wage increases that were foregone by participants to generate 

contribution rate increases required by the various rehabilitation plans. Additionally, any 

prospective employer who commences participation in the Plan could face withdrawal liability 

(although the Plan has adopted a free-look rule provision and is a construction industry plan for 

purposes of the construction industry exemption to employer withdrawal liability, both of which 

serve to substantially lessen the harshness of withdrawal liability as compared to non-construction 

industry plans). Under these circumstances the Trustees believe that any rational employer faces a 

difficult decision in determining whether to sign a CBA that requires contributions to the Plan. But 

other factors support signing or continuing to sign CBAs under which contributions are made to 

the Plan. Factors supporting continued Plan participation include the access to a highly skilled, 

safety trained workforce whose members enjoy valuable CBA-provided fringe benefits other than 

the Plan. As a result, the ability to provide employees the promise of contributions to (and 

continued accruals under) the Michigan Regional Council of Carpenters’ Annuity Fund, or for 

Millwrights, the Millwrights’ Local 1102 Supplemental Pension Fund, quality healthcare and 

access to post-retirement health benefits under the Michigan Regional Council of Carpenters 

Employee Benefits Fund as well as training (including journeyman upgrades) from Michigan 

Statewide Carpenters and Millwrights Joint Apprenticeship and Training Fund still allow 

employers to offer attractive benefits to potential new employees and to retain skilled carpenters

and related craft workers. So, while the financial position of the Plan, standing alone, makes it 

more difficult to attract new long term participating employers, consideration of other advantages 

conferred by using highly skilled workers who continue to be attracted by other CBA-required 

fringe benefits, the Plan continues to maintain a broad base of contributing employers (see,

Application Exhibit 9 (list of contributing employers) and the contribution obligation is welldistributed (see, Application Exhibit 11). For example, since May 1, 2015 no single employer has

accounted for more than 5% of total plan contributions. Id. 

CPTF-DV000013
It should also be noted that under current CBAs the Union and employers have agreed to 

market recovery provisions by which the employers (or associations of employers) and Union 

agree to more employer-friendly wage and fringe benefit packages when appropriate to permit 

contributing employers to effectively compete on specific projects. Market recovery rates are 

negotiated on a job-by-job or area-by-area basis. These market recovery initiatives provide 

appropriate flexibility and allow contributing employers to enhance their ability to compete with 

non-union competitors for targeted work, to the benefit of the Plan. 

The Trustees of the Plan are committed to retaining and making appropriate efforts to 

expand the Plan’s contribution base. This commitment is demonstrated by their determination not 

to seek additional contribution rate increases from existing contributing employers, which could 

foreseeably lead to employer bankruptcies and possible uncollectible withdrawals, particularly 

with respect to display industry contractors (who are generally not beneficiaries of the construction 

industry exemption to employer withdrawal liability). The fact that there have been new employers

signatory to the CBAs since the Plan’s future benefit accrual rate was reduced to 1% and 

notwithstanding the contribution rate increases imposed by the Plan’s rehabilitation and ARM 

plans is objective evidence of the prudence of the Trustees’ approach to the issue. 

(2) The impact on plan solvency of the subsidies and ancillary benefits available to 

active participants. 

As noted above, substantially all adjustable benefits have been eliminated under the 

rehabilitation and ARM plans. The Trustees have reasonably and prudently determined that 

elimination of additional benefits would make it impossible to maintain sufficient employee 

participation to staff upcoming work, which otherwise would lead to a further decline in 

contribution hours, hastening the Plan’s insolvency. 

(3) Compensation levels of active participants relative to employees in the participants’ 

industry generally. 

The 2018 median pay for Carpenters in the United States is $46,590 per year, reflecting an 

average hourly wage of $22.40 per hour. U.S. Bureau of Labor Statistics, Carpenters: Occupational 

Outlook Handbook, https://www.bls.gov/ooh/construction-and-extraction/print/carpenters.htm

The current wage rates for Carpenters ($32.70 per hour) and Millwrights ($31.50 per hour) 

compare favorably to the median. See, Application Exhibit 12B. 

 

(4) Competitive and other economic factors facing contributing employers. 

 (See, Application Exhibit 17, Narrative Statement). Significant contribution increases 

have been made by signatory employers since 2010. This has resulted in significant wage 

deferments by members. These significant contribution increases have increased the pressure on 

signatory contractors to remain competitive in the Detroit regional market. 

How Plan factors were taken into account/other factors considered 

- The impact of benefit and contribution levels on retaining active participants and 

 bargaining groups under the plan. 

CPTF-DV000014
With reference to the description above, the Trustees observe that current active 

participants are making significant wage package allocations to the Plan but are accruing future 

pension benefits at a fraction of 1%. Any further increase in the contribution rate would likely 

result in employer withdrawals and a loss of bargaining unit members for whom Plan contributions 

will be required. 

- The impact of past and anticipated contribution increases under the plan on 

employer attrition and retention levels. 

With reference to the description above, there is no current intention to increase the 

required contribution rate in the foreseeable future, as such an action is reasonably anticipated to 

have a significant detrimental impact on the Plan’s future funding. 

SECTION 4. DEMONSTRATION THAT THE PLAN’S PROPOSED SUSPENSION 

SATISFIES THE STATUTORY REQUIREMENTS

4.01 Demonstration that limitations on individual suspensions are satisfied. 

Application Exhibit 4 contains sample calculations that demonstrate how the proposed 

suspension satisfies the limitations described in Code § 432(e)(9)(D)(i), (ii) and (iii). Section 4.01 

of the Revenue Procedure requires information demonstrating that certain statutory limitations 

with respect to the proposed suspension are satisfied. The limitations set forth in Section 4.01 are 

satisfied based upon the following (summarized) individual demonstrations. 

Guarantee-based Limitation 

 The proposed suspension does not reduce the benefit of any participant or beneficiary to 

an amount that is less than 110% of the PBGC guarantee. 

 If a participant’s benefit has been split with an alternate payee under the terms of a qualified 

domestic relations order (QDRO), the determination of the guaranteed level for both parties is 

based on the terms of the QDRO. Generally, if the QDRO provides the alternate payee a shared 

interest with the participant, the participant’s total benefit is used for purposes of determining the 

guaranteed amount for both parties. If the QDRO provides a separate interest for the alternate 

payee, the alternate payee’s separate benefit level is used to determine the guaranteed amount. If

there are multiple QDROs with multiple alternate payees, this determination is made separately 

with respect to each QDRO.

Age-Based Limitation

 The proposed suspension does not affect any participant or beneficiary who will be age 80 

or older as of July 31, 2020 (the end of the month in which the July 1, 2020 effective date of the 

proposed suspension occurs). The proposed suspension only partially affects any participant or 

beneficiary who will be age 75-79 as of July 31, 2020 (with proportionally more of the current 

benefit being protected the closer the participant or beneficiary is to age 80). 

 In the event that the age-based limitation applies to a participant that has a QDRO, then the 

type of QDRO will determine whether the Plan uses the participant’s or alternate payee’s age. If 

the QDRO provides the alternate payee a shared interest with the participant, the participant’s age 

CPTF-DV000015
is used for purposes of applying the age-based limitation as of the proposed suspension’s effective 

date. If the QDRO provides a separate interest for the alternate payee, the alternate payee’s age is 

used to determine the application of the age-based limitation. If there are multiple QDROs with 

multiple alternate payees, the determination of whose age to use is determined separately for each 

QDRO.

The application of the age-based limitation for a participant who elected a joint and 

survivor benefit is based on the age of the participant as of July 31, 2020. If the participant is 

deceased, the surviving spouse’s age is used to determine the application of the age-based 

limitation.

Section 4.01(3) of the Revenue Procedure requires submission of sample calculations for 

each group defined in Checklist Item #2 that includes an individual who is over age 75 (as of July 

31, 2020). Note that no calculations are included for groups that have a sub-group designation 

of “2” because the individuals in these groups have only post-5/1/2007 accruals and will not be 

affected by the suspension.

Section 4.01(3)(c) of the Revenue Procedure requests submission of sample calculations 

on individuals who are between age 75 and 79 but have not commenced benefits. All Plan 

participants satisfying the preceding criteria are past their IRC section 401(a)(9) required 

beginning date and ARE treated as being in pay status retroactive to such date. Therefore, no 

such calculations are included for the “A” and “B” groups.

The “C groups” and “D groups” do not contain anyone over the age of 75, so no 

calculations are included for these groups. 

Based on the preceding, sample age-based limitation calculations are submitted on the 

following groups:

• E1

• E3

Disability-based Limitation 

 The proposed suspension does not affect any disability benefit that is in pay status as of 

July 1, 2020. If a disabled participant has converted to a retirement benefit on or prior to July 1, 

2020, such participant’s benefit will not be reduced below the amount of his or her disability 

benefit.

 There are currently 3 types of disability benefits paid to an individual under the Plan. 

1. Basic Disability Benefit – To be eligible for this benefit, the participant must be under age 

62, have at least 5 credit years, and have a disability award from the Social Security 

Administration (SSA). The benefit is paid in the form of a temporary life annuity generally 

ending at age 62. The benefit amount is equal to the greater of: (a) 75% of the vested 

accrued benefit, or (b) $280, but is subject to a cap pursuant to the following table: 

CPTF-DV000016
Number of 

Credit 

Years

Cap on 

Disability 

Benefit

5-9 $525

10-15 $625

16-19 $725

20-24 $1,050

25+ $1,350

2. Lump Sum Disability Benefit – If a participant is disabled with an SSA award but has less 

than 5 credit years (the plan uses 3-7-year graded vesting), then he or she is eligible for a 

lump sum cash-out equal to the actuarial present value of his or her vested accrued benefit. 

Note that, as required by Code Section 432, this benefit is not currently payable if it exceeds 

$5,000. 

3. Lawsuit-related Disability Benefit – As the result of the October 2016 class action lawsuit

settlement, the disability benefits of most disabled participants who were in pay status as 

of 8/1/2013 and had taken a cut due to the 2013 Plan amendment implementing the servicebased cap described above were restored to 95% of their pre-amendment disability benefit

amount. After these participants retire, the disability-based limitation will be applied based 

on the 95% of pre-amendment disability amount.

The following special rules apply to the application of the disability-based limitation:

• When the Plan was amended in 2013 to require a disability award from the SSA, disabled 

retirees without such an award were allowed one year to obtain one. As a result of this 

change, some previously disabled participants ceased to qualify under the plan rules. These 

participants will not receive any special protection under the disability-based limitation.

• As the result of the 2016 class action settlement, affected disabled participants who were: 

a. In pay status on 8/1/2013, and 

b. Converted to early retirement prior to October 2016, and 

c. Had an early retirement benefit that was less than 95% of their prior disability 

benefit,

were granted a benefit increase to 95% of their pre-amendment disability amounts payable 

until age 62, at which time their benefit will increase to an unreduced, early retirement 

benefit. For purposes of the disability-based limitation, the benefit payable until normal 

retirement age for these participants will be treated as a disability benefit.

 If a participant’s benefit is split with an alternate payee under the terms of a QDRO, then 

the determination of the amount of the disability-based limitation for both parties is based on the 

terms of the QDRO. In the case of a separate interest QDRO, the alternate payee will generally not 

receive any portion of the disability-based limitation. The exception is an alternate payee who was 

assigned a portion of the participant’s disability benefit, who will receive a disability-based 

CPTF-DV000017
limitation based on the portion of disability benefit assigned and the participant will not receive a 

disability-based limitation based on such portion. 

In the case of a shared interest QDRO, any disability-based limitation will be shared in the 

same manner as the benefit itself.

 Surviving spouses and beneficiaries will not receive any disability-based limitation.

Sample Calculations 

 The sample calculations required by Section 4.01 of the Revenue Procedure are found at 

Application Exhibit 4. Note that: 

• There are no ERISA 4022A(a) forfeitable benefits, 

• There are no ERISA 4022A(b)(1)(A) benefit increases that have been in effect for less than 

60 months, 

• The limitations contained in ERISA 4022A(c)(2) have been reflected in the guaranteebased calculations,

• There have been no ERISA 4022A(d) benefit reductions made pursuant to Code section 

411(a)(3)(E) (related to service with an employer rendered prior to such employer’s 

obligation to contribute to the plan where such employer subsequently ceases to have an 

obligation to contribute), and

• The ERISA 4022A(e) exclusion does not apply as the Secretary of the Treasury has not 

determined that the plan fails to satisfy the requirements of Code sections 401(a) or 

404(a)(2).

A list of the required exhibits appears below: 

Internal 

Exhibit #

Relevant 

Section of Rev. 

Proc. 2017-43 Description

I 4.01(1) Guarantee-based limitation for an individual currently receiving 

benefits

II 4.01(1) Guarantee-based limitation for the contingent beneficiary of an 

individual currently receiving benefits

III 4.01(1) Guarantee-based limitation for a future retiree

IV 4.01(2) 

Disability-based limitation for an individual currently receiving 

retirement benefits (who previously received a disability 

benefit)

V 4.01(2) 

Disability-based limitation for the contingent beneficiary of an 

individual currently receiving retirement benefits (who 

previously received a disability benefit)

VI 4.01(2) Disability-based limitation for a future retiree who is currently 

receiving a temporary annuity disability benefit

CPTF-DV000018
Internal 

Exhibit #

Relevant 

Section of Rev. 

Proc. 2017-43 Description

VII 4.01(2) 

Disability-based limitation for an individual currently receiving 

retirement benefits (who previously received a disability benefit 

that was equal to 95% of his or her pre-8/1/2013 disability 

benefit due to the October 2016 settlement)

VIII 4.01(2) 

Disability-based limitation for the contingent beneficiary of an 

individual currently receiving retirement benefits (who 

previously received a disability benefit that was equal to 95% of 

his or her pre-8/1/2013 disability benefit due to the October 

2016 settlement)

IX 4.01(2) 

Disability-based limitation for a future retiree who is currently 

receiving a disability benefit equal to 95% of his or her pre8/1/2013 disability benefit due to the October 2016 settlement

X 4.01(2) 

Disability-based limitation for an individual who had 

previously received a retirement benefit that is treated like a 

disability benefit due to the October 2016 settlement

XI 4.01(2) 

Disability-based limitation for the contingent beneficiary of an 

individual who had previously received a retirement benefit that 

is treated like a disability benefit due to the October 2016 

settlement

XII 4.01(2) 

Disability-based limitation for an individual who is currently 

receiving a retirement benefit that is treated like a disability 

benefit due to the October 2016 settlement

XIII 4.01(3) Group E1 retiree who is between age 75 and 79 as of 7/31/2020

XIV 4.01(3) Beneficiary of a group E1 retiree who is between age 75 and 79 

as of 7/31/2020

XV 4.01(3) Group E3 retiree who is between age 75 and 79 as of 7/31/2020

XVI 4.01(3) Beneficiary of a group E3 retiree who is between age 75 and 79 

as of 7/31/2020

4.02 Demonstration that the proposed suspension is reasonably estimated to enable the plan to 

avoid insolvency. 

(1) Deterministic Illustrations

Application Exhibit 3 is the Plan Actuary’s Certification that the Plan is Projected to 

Avoid Insolvency. This certification includes a demonstration pursuant to Code §432(e)(9)(D)(iv) 

that the proposed suspension is reasonably estimated to enable the Plan to avoid insolvency. 

The Certification contains a year-by-year projection demonstrating that the Plan is 

projected to avoid insolvency within the meaning of Code §418E for the extended period with the 

proposed suspensions going into effect on July 1, 2020. It also contains illustrations as to the Plan’s 

solvency ratio and available resources for each year of the extended period. See, Application 

Exhibit 3, Internal Exhibit III. 

CPTF-DV000019
(2) Illustration that the proposed suspension is reasonably estimated to achieve the 

level necessary to avoid insolvency for the extended period utilizing stochastic 

projections. 

Application Exhibit 5 summarizes the results of 2,000 stochastic trials. Each trial consists 

of a projection of the market value of Plan assets for the plan years ending April 30, 2020 through 

2065. 

The probability of maintaining solvency over the extended period is: 51.7%

The 5th, 25th, 50th, 75th and 95th percentiles of the projected market value of plan assets are 

shown in graphical format in Internal Exhibit I and in tabular format in Internal Exhibit II. 

Application Exhibit 11 describes the actuarial assumptions and methodology used in the 

reports filed with this application, as required under the Revenue Procedure, Section 4.02(3). 

4.03 Demonstration that the proposed suspension is reasonably estimated to not materially 

exceed the level necessary to avoid insolvency 

Application Exhibit 6 contains the Plan actuary’s demonstration pursuant to Code 

§432(e)(9)(D)(iv) that the proposed benefit suspension is reasonably estimated to not materially 

exceed the level necessary to avoid insolvency. 

(1) Demonstration That the Proposed Suspension Is Not Projected To 

Materially Exceed the Level Necessary to Avoid Insolvency Based On a 

Deterministic Projection

As required by the Revenue Procedure, Section 4.03, the application must include a 

deterministic projection demonstrating that, if the dollar amount of the proposed suspension for 

each participant and beneficiary was reduced by the greater of:

• 5% of the reduction in payment proposed for that participant or beneficiary, or 

• 2% of that participant’s or beneficiary’s payment determined without regard to the 

proposed reduction, 

the Plan would not be reasonably estimated to avoid insolvency. 

Internal Exhibit I provides plan-year-by-plan-year projections demonstrating projected 

insolvency during the extended period and identification of the available resources during each of 

those years. The illustration is based on the actuary’s interpretation of the requirements under the 

Revenue Procedure, Section 4.03. Application Item 11 describes each of the assumptions used, 

as required under the Revenue Procedure, Section 4.02(3).

CPTF-DV000020
(2) Demonstration That the Proposed Suspension Is Not Projected To 

Materially Exceed the Level Necessary to Avoid Insolvency Based On a Stochastic

Projection

As required by the Revenue Procedure, Section 4.03, the application must include a 

demonstration utilizing stochastic projections that, if the dollar amount of the proposed suspension 

for each participant and beneficiary was reduced by the greater of:

• 5% of the reduction in payment proposed for that participant or beneficiary, or 

• 2% of that participant’s or beneficiary’s payment determined without regard to the 

proposed reduction,

the Plan would not be reasonably estimated to avoid insolvency. 

Internal Exhibit II summarizes the results of 2,000 stochastic trials. Each trial consists 

of a projection of the market value of Plan assets for the plan years ending April 30, 2020 through 

2065 assuming implementation of the hypothetical reduced suspension as outlined above.

The probability of maintaining solvency over the extended period is: 44.7%

The 5th, 25th, 50th, 75th and 95th percentiles of the projected market value of plan assets are 

shown below in graphical format in Exhibit I and in tabular format in Exhibit II. 

Application Exhibit 11 describes the actuarial assumptions and methodology used in the 

reports filed with this application, as required under the Revenue Procedure, Section 4.02(3). 

4.04 Demonstration that the proposed benefit suspension is distributed equitably. 

The proposed benefit suspension provides for different treatment of participants and 

beneficiaries and is distributed in an equitable manner across the Plan’s participant and beneficiary 

population as required pursuant to Code §432(e)(9)(D)(vi). Application Exhibit 7 contains: 

• information on the effect of the suspension on the Plan in the aggregate,

• information on the effect of the suspension on the Plan on a group-by-group basis. 

• a list of the factors taken into account, 

• an explanation of why none of the factors listed in Code § 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 Code § 

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, 

as required by section 4.04 of the Revenue Procedure.

Effect of Proposed Suspension on the Plan in the Aggregate

CPTF-DV000021
Internal Exhibit I provides the information on the effect of the suspension required by 

sub-section 4.04(1)(a) of the Revenue Procedure on an aggregate basis. 

Internal Exhibit II provides the distribution of participants by benefit reduction 

percentage on an aggregate basis as required by sub-section 4.04(1)(b) of the Revenue Procedure.

Effect of Proposed Suspension on the Plan on a Group-by-Group Basis 

Internal Exhibit III provides information on the effect of the suspension described in subsection 4.04(1)(a) of the Revenue Procedure broken out according to the groups described in 

Section 2.02 of this Application, as required by sub-section 4.04(2)(a) of the Revenue Procedure. 

Internal Exhibits IV through XV provide the distribution of participants by benefit 

reduction percentage described in sub-section 4.04(1)(b) of the Revenue Procedure on a group-bygroup basis, as required by sub-section 4.04(2)(a) of the Revenue Procedure. Please refer to the 

following table (note, groups A1, C2, and D2 contain no participants): 

Group Description Exhibit

A1 Active, pre-5/1/2007 accruals only n/a

A2 Active, post-5/1/2007 accruals only IV

A3 Active, pre- and post-5/1/2007 accruals V

B1 Deferred vested, pre-5/1/2007 accruals only VI

B2 Deferred vested, post-5/1/2007 accruals only VII

B3 Deferred vested, pre- and post-5/1/2007 accruals VIII

C1 Retiree with benefit reduction effective 8/1/2013, pre-5/1/2007 accruals 

only IX

C2 Retiree with benefit reduction effective 8/1/2013, post-5/1/2007 accruals 

only

n/a 

C3 Retiree with benefit reduction effective 8/1/2013, pre- and post-5/1/2007 

accruals X 

D1 Beneficiary of the October 2016 disability lawsuit settlement, pre5/1/2007 accruals only XI

D2 Beneficiary of the October 2016 disability lawsuit settlement, post5/1/2007 accruals only n/a 

D3 Beneficiary of the October 2016 disability lawsuit settlement, pre- and 

post-5/1/2007 accruals XII

E1 Retiree not included in a C or D group, pre-5/1/2007 accruals only XIII

E2 Retiree not included in a C or D group, post-5/1/2007 accruals only XIV

E3 Retiree not included in a C or D group, pre- and post-5/1/2007 accruals XV

 Identification of Factors Taken Into Account 

 

In deciding whether the proposed reduction is equitably distributed (with deferred vested 

participants who accrued benefits prior to 2007 subject to a proposed suspension of 26%) the Board 

of Trustees took into account the following factors listed in § 432(e)(9)(D)(vi): 

 

CPTF-DV000022
(III) The amount of benefits. In general, participants who left covered employment prior 

to plan year 2007 have accrued the greatest benefits under the Plan due to the higher historical 

accrual rates, as well as the potential for heavily subsidized early retirement benefits which have

been eliminated. 

(V) The extent to which a participant or beneficiary is receiving a subsidized benefit. 

As noted above, participants who retired prior to the adoption of the Rehabilitation Plan and All 

Reasonable Measures Plan had early retirement benefit subsidies available to them that postPPA/ARM participants do not. 

(VII) The Plan’s history of benefit increases or reductions, which, taken together support 

the distinction between the deferred vested and active/retiree groups as well as the pre-and post 

2007 subgroups: 

• The Plan was amended so that contributions for work performed on after May 1, 2007 was 

decreased from 3% to 1% 

• The Plan was amended so that contributions for work performed on or after June 1, 2007 

are generally discounted (non-credited) by 16% to 17%. At that time some contracts were 

discounted by 35%. The history of the Plan’s non-credited contribution percentages is set 

out in the table reproduced at Section 3.03 of this Application

• Effective January 1, 2010, post-retirement increases that had been granted December 31, 

1996, May 1, 1999, May 1, 2000, and June 1, 2001 were all eliminated 

• Effective May 1, 2010, for non-grandfathered participants (age plus years of service at least 

76 on May 1, 2010) the index 80 requirement was changed to index 85. Participants who 

joined the Plan on or after May 1, 2007 must also be at least age 55 to qualify for index 85.

• Effective July 12, 2012, the “cap” on the non-credited contribution rate was removed 

retroactive to June 1, 2011. 

• Effective June 1, 2012, the reciprocity agreement with Michigan Carpenters Pension Fund 

was modified so that only credited amounts are transferred back to the participant’s home 

fund. 

• Effective August 1, 2013, but retroactive to September 1, 2008, no unreduced early 

retirements are permitted prior to attaining age 62.

• Effective August 1, 2013, participants who failed to cure a break in service by working 435 

hours in the two years prior to retirement will have their benefit reduced by 5/9% for each 

month under age 65. 

• Effective August 1, 2013, but retroactive to September 1, 2008, participants must now 

obtain a disability award from the Social Security Administration in order to be eligible for 

disability benefits under the Plan. Disability benefits commencing on or after September 

1, 2008 are capped in accordance with a new schedule depending on a participant’s credit 

years.

• Effective August 1, 2013, pre-retirement death benefits were discontinued for unmarried 

participants. Surviving spouse pre-retirement death benefits were reduced to 50% of the 

joint and 50% survivor annuity. Pre- and post-retirement lump sum death benefits were 

discontinued at the same time. 

CPTF-DV000023
• Effective August 1, 2013, for early retirements that commence on or after September 1, 

2008, early retirees who work any hours in prohibited employment will have their benefits 

suspended to the extent permitted by law. 

(IX) Any discrepancies between active and retiree benefits. See the discussion above 

regarding the impact of the Rehabilitation Plan and All Reasonable Measures Plan and above 

regarding the decreases in the accrual rate to plan year 2007. 

(X) The extent to which active participants are reasonably likely to withdraw support for 

the Plan, accelerating employer withdrawals from the Plan and increasing the risk of additional 

benefit reductions for participants in and out of pay status. Active members since 2003 have 

experienced multiple reductions in the accrual rate while the contribution rate paid by their 

employers has increased. While such reductions were necessary as part of the effort to forestall 

insolvency these accrual rate reductions could have a chilling effect on the active participants’ 

support for the Plan, which could accelerate the rate of employer Plan withdrawals. It is therefore

prudent to take steps to ameliorate the impact of the proposed suspension on the active participants 

to the extent possible, and the suspension design reflects this goal. 

Differences in Treatment Among Groups Result from Reasonable Application of Relevant 

Factors

The active and retiree group of participants has experienced substantial uncredited 

contributions while the deferred vested former participants who left covered employment before 

June 1, 2003, have not. In general, the proposed suspension is structured such that active 

participants/retirees potentially experience a smaller benefit reduction than deferred vested 

participants to mitigate the risk of losing support for the Plan and accelerating employer Plan

withdrawals. 

4.05 Notice. 

The Trustees have satisfied the notice requirements of Code §432(e)(9)(F) as follows: 

(1) Individual notices. 

Application Exhibits 8A and 8B to the Application contains each type of notice that will 

be given to each participant and beneficiary under the Plan, as well as to each employer that has 

an obligation to contribute to Plan and to each employee organization representing participants in 

the Plan. 

The Plan has also established a website (http://www.detroitcarpentersprp.org/) containing 

frequently asked questions and other information useful to participants with regard to the proposed 

suspension.

(2) Efforts made to contact participants, beneficiaries and alternate payees. 

The Board of Trustees has compiled a complete and up to date records of the Plan’s 

participants and beneficiaries. If an address is found to be invalid, it will be referred to the Plan’s 

CPTF-DV000024
third-party administrator (BeneSys) which would refer the it to PBI, the entity used by BeneSys to 

monitor participant death records and locate missing participants. BeneSys also conducts searches 

using on-line search tools. 

(3) Notices will not be delivered electronically. 

(4) Lists of: 

(a) Each employer that has an obligation to contribute to the Plan within the 

 meaning of section 4212(a) of ERISA. 

A list of the contributing employers that have an obligation to contribute to the Plan within 

the meaning of § 4212(a) of ERISA is attached as Application Exhibit 9. 

(b) Employee organization representing participants under the plan. 

 

The employee organization representing participants under the Plan is the Michigan 

Regional Council of Carpenters and its subordinate affiliate Local Unions. 

SECTION 5. PLAN SPONSOR DETERMINATION RELATING TO REASONABLE 

MEASURES TAKEN TO AVOID INSOLVENCY

5.01 Measures taken to avoid insolvency. 

See, discussion in Section 3.03 and 3.04, above, and the Narrative Statement (Application 

Exhibit 17).

5.02 Plan factors. 

See, discussion in Section 3.03 and 3.04, above, and the Narrative Statement (Application 

Exhibit 17). 

5.03 How plan factors were taken into account. 

See, discussion in Section 3.03 and 3.04, above, and the Narrative Statement (Application 

Exhibit 17). 

5.04 Other factors considered. 

See, discussion in Section 3.03 and 3.04, above, and the Narrative Statement (Application 

Exhibit 17). 

SECTION 6. OTHER REQUIRED INFORMATION

6.01 Ballot. 

See, Application Exhibit 10 for a proposed ballot package intended to satisfy the 

requirements of Code §432(e)(9)(H)(iii). In keeping with the Revenue Procedure, the ballot 

CPTF-DV000025
package does not include the information described in Regulation §1.432(e)(9)-1(h)(3)(i)(E), (L) 

or (M)(the statement in opposition to the proposed benefit suspension, the individual estimate that 

will be provided as part of the notice, and the voting procedures, including the deadline for voting). 

6.02 Partition. 

 The Plan is not requesting approval for a partition. 

6.03 Description of assumptions used in projections. 

Application Exhibit 11 fulfills the requirements of Section 6.03 of the Revenue Procedure 

by describing the assumptions used by the Plan’s actuary for performing projections required under 

sections 3.01, 3.02, 4.02(1), 4.02(2), and 4.03 of the Revenue Procedure. Internal Exhibit I 

(Actuarial Assumptions and Methods Used for Projections). The certification of critical and 

declining status described in section 3.01 was prepared before submission of this Application and

includes assumptions that differ from those used to prepare other projections contained herein. 

These differences are noted. 

With regard to the contribution base units (CBU) assumption described in Internal Exhibit 

I, the Trustees submit with this Application Application Exhibit 12A Carpenters Pension Trust 

Fund – Detroit & Vicinity, 20-year Forecast (August 26, 2019). To provide the Secretary with 

substantial additional objective support for the CBU assumption the Trustees retained the services 

of Employment Research Corporation and that entity’s President, Malcom S. Cohen, PhD. As Dr. 

Cohen’s states he:

was asked to make a projection of demand for unionized construction-industry 

carpenters in Michigan. I was provided with historical data on hours worked by 

members of the Carpenters Pension Trust Fund – Detroit and Vicinity (“the Fund”). 

Employer contributions to the Fund are related to each employee’s hourly rate. 

There are different kinds of projections. Economists look at past trends and current 

leading indicators and make projections based on these trends. These forecasts are 

intended to assist analysts in understanding broad trends and risks and are not 

intended to determine actual contribution rates that should be made to keep a 

pension plan solvent. These determinations are typically made by actuaries that 

have more experience with fund flows and understand risks to the solvency of the 

fund. They also have a better understanding of the specifics of the fund contributors 

as well as specific risks.

In other words, the purpose of inviting Dr. Cohen’s review was to determine if objective 

economic data was, independent of any input from the Plan’s actuary as to the basis of the 

assumptions utilized in this Application, supportive of the assumption applied by the actuary as to 

future CBUs. Dr. Cohen provided the following summary explanation of his methodology: 

In order to project expected hours worked for future years, I compared the data on 

hours with measures related to industry activity such as Carpenters’ employment in 

the United States, Michigan and the Detroit Metropolitan Statistical Area. Figure 2 

shows Carpenter employment in Michigan and in the Detroit Metropolitan 

Statistical Area from 2003 to 2018. 

CPTF-DV000026
 Dr. Cohen further notes that: 

The demand for Carpenters can fluctuate based on economic conditions. During an 

economic recession, it is not unusual to see a decrease in demand for many types 

of labor. The National Bureau of Economic Research (NBER) defines a recession 

as a “significant decline in economic activity spread across the economy, lasting 

more than a few months, normally visible in real GDP, real income, employment, 

industrial production, and wholesale-retail sales.”

 From there, Dr. Cohen analyzes the impact of foreseeable recessionary periods on 

projected carpenter employment:

In the last 40 years there have been three major declines in Carpenter employment, 

occurring from 1979-1982, 1988-1992, and 2006-2010. From 2006 to 2010, 

Carpenter employment dropped by 33%. Over the same time period, hours worked 

by carpenters in Michigan declined by 47%, from 11,200,000 to 5,900,000. 

To estimate the impact of future declines, I have included a projection that assumes 

there will be two declines over the next 20 years that and that each will average 

30%. I assume that employment will decline 15% during the first year, and bottom 

at 30% in the second year, then return to the 4.2% growth rate experienced by 

Carpenter hours from 2010 to 2018. 

In this projection, shown in Figure 6 [reference is to chart in exhibit, not reproduced 

here], Carpenter hours will reach 7.7 million by 2038, but there is a 30% reduction 

in hours occurring over two years in 2021 and 2032. 

As reasonably anticipated, the actuary’s CBU assumption and the projections made by 

Dr. Cohen from his independent examination of economic data are not identical, although they 

are closely analogous. So, the Plan actuary’s assumption is:

Plan Year Ending Hours

2020 8.2 million

2021 8.0 million

2022 7.8 million

2023+ 7.0 million

 The average expected hours over the 20 year period = 7.15 million. 

 And Dr. Cohen’s projected hours for the Plan are: 

Year Projected Hours Worked

2019 8,528,350

2020 8,886,541

2021 7,553,560

2022 6,220,579

CPTF-DV000027
2023 6,481,843

2024 6,754,080

2025 7,037,752

2026 7,333,337

2027 7,641,337

2028 7,962,274

2029 8,296,689

2030 8,645,150

2031 7,348,377

2032 6,051,605

2033 6,305,772

2034 6,570,615

2035 6,846,581

2036 7,134,137

2037 7,433,771

2038 7,745,989

The projected economic forecast of average hours over the 20 year period = 7.29 million 

hours. 

The Trustees recognize that this separate piece of analysis is not specifically required to be 

part of this Application under the Revenue Procedure, and appreciate the willingness of Treasury 

to receive it and to give to it the weight deemed appropriate. The Trustees respectfully suggest that 

the objective nature of the analysis adds support to validity of the CBU assumption applied to the 

proposed suspension. 

Internal Exhibit II is the Plan actuary’s Supporting Documentation for Selection of 

Certain Assumptions, including the actuary’s rationale for the major assumptions. 

Internal Exhibit III is the Plan actuary’s Additional Disclosures Relating to the Use of 

Different Assumptions, and provides the actuary’s explanation of the differences between 

assumptions used under section 4.02(1) and 3.01 of the Revenue Procedure, utilizing deterministic 

and stochastic projections. Application Exhibit 11 and its internal exhibits are based on the Plan 

actuary’s interpretation of the requirements under the Revenue Procedure, Section 6.03 and 

Appendix B. 

6.04 Ten-year experience for certain critical assumptions. 

Application Exhibit 13 describes the Plan's experience for certain critical assumptions 

including a disclosure for each of the 10 plan years immediately preceding the submission of this 

Application separately identifying, in accordance with Section 6.04 of the Revenue Procedure: 

• Total contributions; 

• Total contribution base units; 

• Average contribution rates; 

• Withdrawal liability payments; and 

• Rate of return on plan assets. 

CPTF-DV000028
6.05 Demonstration of sensitivity projections. 

Application Exhibit 14 is the Plan actuary’s Demonstration of Sensitivity of Projections

as required under Section 6.05 of the Revenue Procedure, which requires inclusion of deterministic 

projections of the sensitivity of the Plan’s solvency ratio throughout the extended period by taking 

into account more conservative assumptions of investment experience and future contribution base 

units than assumed in other parts of this Application. The Plan’s actuary notes that while Section 

6.05 of the Revenue Procedure and the attendant checklist description (Checklist # 27) speak to 

using more conservative assumptions for future contribution base units, assuming that the 10-year 

trend of CBU increases continues into the future is in fact more aggressive than the projection 

assumptions used in other parts of this Application. 

Internal Exhibits I, II, III, and IV provide separate, deterministic solvency ratio 

projections intended to help gauge the sensitivity of the projections to certain key assumptions as 

required by Section 6.05 of the Revenue Procedure. Each exhibit was prepared by the Plan’s 

actuary recognizing the proposed suspension. As permitted by Section 6.05, Internal Exhibits 

III and IV do not recognize any change in expected benefit payments that may result from using 

alternate assumptions regarding future contribution base units. 

• Internal Exhibit I projects the Plan's solvency ratio using assumed rates of return reduced 

by one percentage point (beginning with the plan year ending April 30, 2021); 

• Internal Exhibit II projects the Plan's solvency ratio using assumed rates of return reduced 

by 2 percentage points (beginning with the plan year ending April 30, 2021); 

• Internal Exhibit III projects the Plan's solvency ratio using a 3.21% contribution base unit 

trend (beginning with the plan year ending April 30, 2021), which is equal to the trend that 

the Plan experienced over the 10 plan years ending April 30, 2019; and 

• Internal Exhibit IV projects the Plan's solvency ratio using a 2.21% contribution base unit 

trend (beginning with the plan year ending April 30, 2021), which is equal to the trend 

assumed in Exhibit III reduced by one percentage point.

The assumed rates of return for Internal Exhibits I and II are as shown below:

Plan Years Ending 

4/30: 

Assumed Rates of Return Used For:

Section 4.02(1) of 

Rev. Proc. 2017-43 Exhibit I Exhibit II

2021-2029 6.50% 5.50% 4.50%

2030-2043 7.50% 6.50% 5.50%

2044-2048 7.30% 6.30% 5.30%

2049-2053 7.20% 6.20% 5.20%

2054+ 7.50% 6.50% 5.50%

The alternative rate of return assumptions above were assumed to first apply following the 

initial period. That is, the April 30, 2020 market value of Plan assets is the same for all scenarios.

CPTF-DV000029
 Hours (contribution base units) increased from 5,796,364 in plan year ending April 30, 

2010 to 7,953,779 in plan year ending April 30, 2019. This represents a compound annual increase 

of 3.21% per year for the 10-year period.

Based on the preceding calculation, the assumed work hours for Internal Exhibits III and IV are 

as shown below: 

Plan Year Ending 

4/30: 

Assumed Work Hours Used For:

Section 4.02(1) of 

Rev. Proc. 2017-43 Exhibit III Exhibit IV

2021 8,000,000 8,472,6071 8,309,2212

2022 7,800,000 8,744,578 8,492,855

2023 7,000,000 9,025,279 8,680,547

2024 7,000,000 9,314,990 8,872,387

2025 7,000,000 9,614,002 9,068,466

2026+ 7,000,000 increases @3.21%/yr. increases @2.21%/yr.

 These demonstrations satisfy Section 6.05 of the Revenue Procedure. 

6.06 Projection of funded percentage. 

Application Exhibit 15 is the Projection of Assets, Liabilities, and Funded Percentage

prepared by the Plan’s actuary and includes a deterministic projection for each year in the extended 

period of the value of the Plan's assets, its accrued liability, and its funded percentage. The table 

produced at Internal Exhibit I projects the Plan's funded percentage using the value of Plan assets 

and accrued liabilities during the extended period of May 1, 2020 through 2065. The projection 

includes the impact of benefit suspensions and is made on the same basis as Internal Exhibit III

of Application Exhibit 3. 

 This exhibit satisfies the requirements of Section 6.06 of the Revenue Procedure.

6.07 Plan sponsor certifications relating to Plan amendments. 

See, Application Exhibit 16 for the Trustees’ certification that if they receive final 

authorization to implement the suspension of benefits as described in Code §432(e)(9)(H)(vi), and 

choose to implement the authorized suspensions they will adopt, in a timely manner, the following 

Plan amendments which shall not be modified at any time thereafter before the suspension of 

benefits expires:

 (1) in accordance with Code §432(e)(9)(C)(ii) a Plan amendment providing that the 

benefit suspension will cease as of the first day of the first plan year following the plan year in 

which the Trustees fail to determine that both: (a) all reasonable measures to avoid insolvency 

continue to be taken during the period of benefit suspension; and (b) the Plan is projected to 

become insolvent unless benefits continue to be suspended; and 

 

1 Hours for plan year ending April 30, 2019 (7,953,779) increased by 3.21% for 2 years (compounded) 2 Hours for plan year ending April 30, 2019 (7,953,779) increased by 2.21% for 2 years (compounded)

CPTF-DV000030
 (2) a Plan amendment providing that any future benefit improvements must satisfy the 

requirements of Code §432(e)(9)(E).

6.08 Whether the Plan is a plan described in §432(e)(9)(D)(vii). 

 The Plan is not a plan described in Code §432(e)(9)(D)(vii). 

6.09 Narrative statement. 

See, Application Exhibit 17. 

SECTION 7. IDENTIFICATION AND BACKGROUND INFORMATION ON THE PLAN

7.01 Plan sponsor. 

 

The Plan sponsor is the Board of Trustees of the Carpenters Pension Trust Fund – Detroit 

& Vicinity. The address of the Board is P.O. Box 4540, Troy, MI 48099-4540. The Telephone 

number is (248) 641-4950. The Board does not have a separate Employer Identification Number 

(EIN).

7.02 Plan identification. 

The name of the Plan is the Carpenters Pension Trust Fund – Detroit & Vicinity. The Plan 

has been assigned Plan Number 001. Its Employer Identification Number (EIN) is 38-6242188. 

The Plan is a multiemployer plan within the meaning of Code §414(f) and ERISA §3(37).

7.03 Retiree representative. 

On December 18, 2018, the Trustees appointed David Morris as the Retiree Representative 

consistent with Section 7.03 of the Revenue Procedure. See, Application Exhibit 18. Contact 

information: 

 David Morris 

MPRA Retiree Representative

 700 Tower Drive, Ste. 300 

 Troy, MI 48098 

(T) (313) 570-1447 

Email: Retiree.Rep@gmail.com

7.04 Plan’s enrolled actuary. 

The Plan’s enrolled and certifying actuary for all actuarial calculations contained in this 

filing with the exception of Application Exhibit 2 is:

Name of Actuary: Andrew T. Smith, FCA, ASA, EA, MAAA 

CPTF-DV000031
Enrollment Number: 17-05374 

Contact Information: 

Address: United Actuarial Services, Inc.

11590 North Meridian Street, Suite 610 

Carmel, Indiana 46032-4529 

Phone: (317) 580-8675 

Fax: (317) 580-8651 

Email: asmith@unitedactuarial.com

The certifying actuary for Application Exhibit 2 (certification of critical and declining status) is:

Name of Actuary: Angela L. Jeffries, EA, MAAA 

Enrollment Number: 17-08511 

Contact Information: 

Address: United Actuarial Services, Inc.

11590 North Meridian Street, Suite 610 

Carmel, Indiana 46032-4529 

Phone: (317) 580-8668 

Fax: (317) 580-8651 

Email: ajeffries@unitedactuarial.com

 

7.05 Power of attorney. 

See, Application Exhibit 19. The Plan’s representatives as attorney-in-fact are John I. 

Tesija and Paul M. Newcomer of Novara, Tesija & Catenacci, PLLC.

7.06 Plan documents. 

See, Application Exhibit 20 for the Plan’s most recently restated plan document; 

Application Exhibit 21 for Plan amendments 1 – 8; Application Exhibit 22 for the Plan’s current 

summary plan description; Application Exhibit 23 for a summary of material modifications; and 

Application Exhibit 24 for the most recent determination letter issued to the Plan by the IRS.

7.07 Collective bargaining and side agreements. 

See, Application Exhibit 25, for excerpts from the collective bargaining agreements and 

side agreements pursuant to which the Plan is maintained, including language from any portions 

of a collective bargaining agreement or side agreement that are relevant to the Plan or proposed 

suspension. 

7.08 Annual return. 

CPTF-DV000032
See, Application Exhibit 26 for the following sections of the Plan’s most recently filed 

form 5500: (1) pages 1 and 2 of Form 5500, (2) Schedule MB, including attachments, (3) Schedule 

R, with attachments, and (4) accountant’s report under section 103(a)(3) of ERISA. 

7.09 Rehabilitation plan. 

See, Application Exhibit 27 for a copy of the Plan’s most recently updated rehabilitation 

plan.

7.10 Valuation reports. 

See, Application Exhibits 28 and 29 for the May 1, 2017, and May 1, 2018 Actuarial 

Valuation Reports for the Plan, respectively. 

7.11 Completed checklist. 

See, Application Exhibit 00 for the completed checklist of information required to be 

included in the Plan’s Application. 

CPTF-DV000032A
The Tmstees appreciate Treasury's review of this impoliant matter for the Plan. Should 

you have any questions or require any additional info1mation please contact John I. T esija or 

Paul M. Newcomer at T: (248) 354-0380. 

CARPENTERS PENSION TRUST FUND - DETROIT & VICINITY 

~ 

. . . 

Signed: September 23, 2019 

CPTF-DV000032B