DEPARTMENT OF THE TREASURY 

WASHINGTON, D.C.

 

 

September 14, 2018

Mr. Michael Parmelee

Ms. Suzanne Mode

Board of Trustees for the Western States 

Office and Professional Employees Pension Fund

PMB 116, 5331 SW Macadam Ave, Suite 258

Portland, OR 97239

Re: Western States Office and Professional Employees Pension Fund (Fund) 

Application for Reduction of Benefits

Dear Mr. Parmelee and Ms. Mode:

On August 3, 2018, you were notified that the Secretary of the Treasury (Treasury), in consultation 

with the Secretary of Labor (DOL) and the Pension Benefit Guaranty Corporation (PBGC), had 

reviewed your application (Application) for a reduction in benefits, which was submitted on May 

15, 2018, and determined that the Application satisfied the requirements of subparagraphs (C), (D), 

(E), and (F) of section 432(e)(9) of the Internal Revenue Code (Code), which were added to the 

Code by Multiemployer Pension Reform Act of 2014 (MPRA). The notification explained that, as 

required under MPRA, before any benefit reduction could go into effect, Treasury would 

administer a vote of eligible participants and beneficiaries to approve or reject the proposed benefit 

reduction.

The voting period began on August 17, 2018, and ended on September 7, 2018. The Fund 

identified 7,331 participants and beneficiaries as eligible to vote. Of the voters identified by the 

Fund who received a ballot,1 2,326 (or 32.16% of all eligible voters) voted to reject the benefit 

reduction, 920 voted to approve the benefit reduction, and 3,986 did not return a ballot. Because a 

majority of voters 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 October 1, 2018, 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) of section 432(e)(9). Under subparagraph (C), after the benefit 

reduction goes into effect, the plan sponsor of the 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 of these annual 

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

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

 1 There were 99 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 Parmelee

Ms. Suzanne Mode

Board of Trustees for the Western States 

Office and Professional Employees Pension Fund

September 14, 2018

Page 2

made available to participants and beneficiaries. If the Fund fails to satisfy the annual plan sponsor 

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

reduction of benefits will expire as of the first day of the 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 of this letter will be posted on the Treasury Department website. Please contact Treasury 

staff if you have any questions or need any additional information.

Sincerely,

Sam J. Alberts

MPRA Special Master

 2 26 C.F.R. § 1.432(e)(9)-1(c)(5).