PBGC will pay retirement benefits for 2,101 people covered by the APL/NVF Consolidated Pension Plan, which is sponsored by the estate of businessman Victor Posner. The estate has interests in about 40 entities that mostly focus on real estate development in Florida, Pennsylvania, and Maryland.
The agency is stepping in because the assets of the Posner estate are being distributed by a Florida Probate Court, and the pension plan will be abandoned. The APL/NVF Consolidated Pension Plan will end as of July 31, 2014.
PBGC will pay all pension benefits earned by the plan's retirees up to the legal limit of about $59,320 a year for a 65-year-old.
Retirees will continue to get benefits without interruption, and future retirees can apply for benefits as soon as they are eligible.
Employees and retirees who are participants in the nine pension plans that were merged into the APL/NVF Consolidated Pension Plan will also continue to receive benefits from the estate until PBGC assumes responsibility.
According to PBGC estimates, the APL/NVF Consolidated Pension Plan is 39 percent funded with $25 million in assets to pay $63.9 million in benefits. The agency is expected to cover the entire $38.8 million shortfall.
Posner, who passed in 2002, was described in a New York Times obituary as a "corporate raider," who at one time had controlling interests in variety of companies including Arby's, Royal Crown Cola, and Sharon Steel.