• 

DEPARTMENT OF THE TREASURY 

WASHINGTON, D.C. 

November 16, 2018 

Mr. Michael Smith 

Mr. Arthur Katz 

Board ofTrustees for the Local 805 Pension Fund 

60 Broad Street 37th Floor ' New York, NY 10004 

Re: Local 805 Pension Fund (Fund) 

Application for Reduction ofBenefits 

Dear Mr. Smith and Mr. Katz: 

On October 5, 2018, you were notified that the Secretary ofthe Treasury (Treasury), in 

consultation with the Secretary ofLabor (DOL) and the Pension Benefit Guaranty Corporation 

(PBGC), had i·eviewed your application (Application) for a reduction in benefits, which was 

submitted on February 23, 2018, and determined that the Application satisfied the requirements of 

subparagraphs (C), (D), (E), and (F) ofsection 432( e )(9) ofthe Internal Revenue Code (Code), 

which were added to the Code by Multiemployer Pension Reform Act of2014 (MPRA). The 

notification explained that, as required under MPRA, before any benefit reduction could go into 

effect, Treasury would administer a vote ofeligible participants and beneficiaries to approve or 

reject the proposed benefit reduction. 

The voting period began on October 18, 2018, and ended on November 9, 2018. The Fund 

identified 1,985 participants and beneficiaries as eligible to vote. Ofthe voters identified by the 

Fund who received a ballot, 1 535 ( or 27.7% of all eligible voters) voted to reject the benefit 

reduction, 296 voted to approve the benefit reduction, and 1,098 did not return a ballot. Because a · 

majority ofvoters identified as eligible by the Fund did not vote to reject the benefit reduction, the 

benefit reduction is permitted to go into effect. Treasury, in consultation with DOL and PBGC, 

has issued a final authorization to reduce benefits under the Fund as described in the Application, 

effective January 1, 2019, subject to the conditions described below. 

Under MPRA, the Fund's ability to reduce benefits is conditioned on the Fund's compliance with 

subparagraphs (C) and (E) ofsection 432( e)(9). Under subparagraph (C), after the benefit 

reduction goes into effect, the plan sponsor ofthe Fund must make an annual determination that, 

despite all reasonable measures to avoid insolvency, the Fund is projected to become insolvent 

unless a benefit reduction continues. The Fund must maintain a written record ofthese annual 

determinations, and this record must include a description ofthe factors considered to determine 

whether all reasonable measures have been taken to avoid insolvency. The written record must be 

1 There were 56 eligible voters whose ballot packet materials were returned to the vote administrator as undeliverable 

and who could not be located using reasonable means. 
Mr. Michael Smith 

Mr. Artlrur Katz 

Board ofTrustees for the Local 805 Pension Fund 

November 16, 2018 

Page2 

made available to participants and beneficiaries. Ifthe Fund fails to satisfy the annual plari sponsor 

. .determination requirement for a plan year (including maintaining the written record), then the 

reduction of benefits will expire as ofthe first clay ofthe following plan year.2 

Subparagraph (E) of section 432(e)(9) establishes rules that apply to any benefit improvements that 

are made under the Fund during the period that the benefit reduction remains in effect. 

A copy ofthis letter will be posted on the Treasury Department website. Please contact Treasury 

~taffifyou have any questions or need any additional information. 

Sincerely, 

Danielle Norris 

Director 

cc: Craig Voelker 

Vincent Regalbuto 

2 26 C.F.R. § 1.432(e)(9)-l(c)(5).