PBGC to Pay Pensions at Ingersoll International
FOR IMMEDIATE RELEASE
April 22, 2004
The Pension Benefit Guaranty Corporation today announced that it has assumed responsibility for the pensions of 2,600 workers and retirees of Ingersoll International Inc., a manufacturer of industrial machines and metal cutting tools based in Rockford, Ill.
"The PBGC is stepping in because Ingersoll is liquidating in bankruptcy and the asset purchaser is not assuming the underfunded pension plan," said Acting Executive Director Vince Snowbarger. "Retirees will continue to receive their monthly benefit checks without interruption, up to guaranteed federal limits, and other employees will receive benefits when they are eligible to retire."
Ingersoll has failed to make more than $11 million in required contributions to its pension plan, which is 28 percent funded. The Ingersoll Retirement Plan has $19 million in assets to cover $69 million in benefit promises, and the PBGC estimates it will be liable for about $48 million of the $50 million shortfall. The pension plan ended as of August 19, 2003, the date the company announced the pending sale of its U.S.-based assets to Camozzi Pneumatics Inc. The PBGC became plan trustee on April 16, 2004.
Under federal pension law, the maximum guaranteed pension at age 65 for participants in plans that terminate in 2003 is $43,977 per year. The maximum guaranteed amount is lower for those who retire earlier or elect survivor benefits. In addition, certain early retirement subsidies and benefit increases made within the past five years may not be fully guaranteed.
Within the next several weeks, the PBGC will send notification letters to all participants in the Ingersoll Retirement Plan. After the transfer of plan documents, the agency will review individual records and calculate each person's benefit according to plan provisions, asset allocation rules, and federal guarantee limits. Workers and retirees with questions may contact PBGC 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 for 800-400-7242. General information about PBGC's pension insurance program is available at www.pbgc.gov.
The PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits earned by 44 million American workers and retirees participating in over 31,000 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 investment returns.
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PBGC No. 04-43