PBGC to Protect Pensions of GS Industries' Kansas City Workers
FOR IMMEDIATE RELEASE
August 05, 2002
The Pension Benefit Guaranty Corporation (PBGC) today announced that it has taken over two underfunded pension plans covering more than 1,000 people who worked at the Kansas City, Mo., facility of GS Technologies Operating Co. The company is a subsidiary of GS Industries Inc., a bankrupt producer of steel rod products.
"PBGC has stepped in because the company is liquidating in bankruptcy and the pension plans do not have enough money to pay all benefits," said PBGC Executive Director Steven A. Kandarian. "The PBGC insurance program will protect the basic pension benefits of GS Industries workers. Retirees will continue to receive their monthly checks up to guaranteed federal limits, and other employees will receive benefits when they are eligible to retire."
The GST Steel Company Pension Plan and the GS Technologies Pension Plan have a combined underfunding of about $44 million, according to PBGC estimates. The agency will take over the plan's assets and use PBGC insurance funds to pay the guaranteed pension benefits of covered workers.
The two GS Industries pension plans were terminated as of June 30, 2002. Under federal pension law, the maximum pension guaranteed for workers in plans that terminated in 2002 is $3,579 a month (or $42,954 a year) for persons retiring at age 65. Maximum guarantees are adjusted for retirees older or younger than age 65 and for those who choose survivor benefits.
Workers and retirees do not need to take any action. Those who have questions may contact the PBGC Customer Service Center toll-free at 1-800-400-7242. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to 800-400-7242.
Five other pension plans formerly maintained by GS Industries were transferred to new corporate sponsors. These plans remain ongoing, unaffected by PBGC's action.
PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits for about 44 million American workers and retirees participating in over 35,000 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by PBGC's investment returns.
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PBGC No. 02-35