Attendance, Meeting Minutes, and Agenda*
*Unofficial minutes of a meeting of the 2024 PBGC Board of Directors. These minutes were not reviewed or approved by the prior Board before establishment of the new Board.
U.S. Department of Labor
Julie A. Su, Acting Secretary of Labor
Lisa M. Gomez, Assistant Secretary, Employee Benefits Security Administration (EBSA)
Gwendolyn McCullough, Special Assistant in the Office of the Assistant Secretary, EBSA
Nicole Swift, Division Chief, EBSA
Ashley Piatt, Employee Benefits Law Specialist, EBSA
Janelle Leung-Tat, Employee Benefits Law Specialist, EBSA
U.S. Department of the Treasury
Janet L. Yellen, Secretary of the Treasury
Laurie Schaffer, Acting Assistant Secretary for Financial Institutions
W. Moses Kim, Director, Office of Financial Institutions Policy
Jong Ho Hwang, Senior Policy Advisor, Office of Financial Institutions Policy
Kyle Brown, Deputy Benefits Counsel, Office of Benefits Tax Counsel
U.S. Department of Commerce
Don D. Graves, Deputy Secretary of Commerce
Sam Marullo, Counselor to the Secretary
Oliver Wise, Acting Under Secretary for Economic Affairs
Julia Beckhusen, PhD, Senior Economist, U.S. Census Bureau
Pension Benefit Guaranty Corporation
Ann Orr, Acting Director, Pension Benefit Guaranty Corporation
Karen L. Morris, General Counsel and Secretary to the Board
Michael Rae, Acting Chief Policy Officer
Christopher Bone, Director, Policy, Research and Analysis Department (PRAD)
John Hanley, Chief of Negotiations & Restructuring
Bob Scherer, Chief Information Officer
David Foley, Chief of Benefits Administration
Patricia Kelly, Chief Financial Officer
David Mudd, Chief Investment Officer
Evan Inglis, Actuary, PRAD
Kevin Muse, Actuary, PRAD
PBGC Office of Inspector General
Nick Novak, Inspector General
Brooke Holmes, Deputy Inspector General
PBGC Office of the Participant and Plan Sponsor Advocate
Camille Castro, Senior Associate Participant and Plan Sponsor Advocate
Emily Spreiser, Associate Participant and Plan Sponsor Advocate
PBGC Advisory Committee Members
Jeanmarie Grisi, Chair
Kweku Obed
Joe LoCicero
Ilana Boivie
Kathryn J. Kennedy
Lamont Tarbox
PBGC Advisory Committee Consultant
Michael W. Jacobson
The Chair called the meeting to order and welcomed the attendees, noting the importance of the 50th anniversary of ERISA for retirement security and the PBGC. The Chair welcomed the members of the PBGC Advisory Committee, including three new members. The Board approved the July 16, 2024, Board minutes by voice vote.
The Acting Director expressed appreciation for the ongoing work of the PBGC Advisory Committee and highlighted PBGC’s accomplishments in FY 2024, including exceeding benchmarks in benefit payments to plan participants in terminated single-employer plans and investment returns, and adopting technology enhancements. The Acting Director reflected on the history of ERISA and growth of PBGC’s single-employer and multiemployer plan programs, including the milestones of the Special Financial Assistance (SFA) program.
The Chair thanked the Acting Director and requested an update on PBGC’s Small Asset Manager Program (SAMP). The Acting Director stated that PBGC awarded the second round of contracts last year. Deputy Secretary Graves requested PBGC’s assessment of the ability of the SAMP firms to build the scale and capacity to become traditional asset managers for PBGC. Secretary Yellen expressed interest in working with the Board on that outcome and the Acting Director agreed to evaluate the issues. The Chair asked the Acting Director to provide PBGC’s analysis at the next Board meeting.
The Chair recognized PBGC Chief of Negotiations & Restructuring John Hanley for an update on the SFA program. Mr. Hanley noted that since inception of the program, PBGC has approved payment of $68 billion to applicant plans, covering nearly 1.2 million participants. Deputy Secretary Graves asked about PBGC’s capacity to process the remaining SFA applications. Mr. Hanley confirmed that the agency has sufficient resources to complete review of current and future SFA applications within the legally required timeframes.
Mr. Hanley reported that PBGC’s independent death audits of 64-SFA recipient plans are well underway, with 12 plans having repaid $4.9 million to Treasury in SFA amounts attributable to inaccuracies in participant census data.
The Chair thanked Mr. Hanley, noting the positive impact of the SFA program on people across the country who rely on their pension benefits. Secretary Yellen and Deputy Secretary Graves expressed gratitude to the PBGC team for its work on this important program.
Next, the Chair recognized PBGC Advisory Committee Chair Jeanmarie Grisi, who described her professional background. The remaining Advisory Committee members—Illana Boivie, Kathryn Kennedy, Joseph LoCicero, Kweku Obed, Monte Tarbox, as well as Advisory Committee consultant Michael Jacobson—provided introductions. Ms. Grisi reflected on the benefits of having consultants to fill gaps in Advisory Committee membership, noting that her term and the terms of Mr. Obed and Mr. LoCicero expire in February 2025. Ms. Grisi acknowledged the Committee’s excellent working relationship with PBGC, including productive meetings, regular investment updates, and timely responses to Committee requests. Topics reviewed by the Committee include the PBGC’s investment policy, its liability driven investment strategy, and related matters. The Committee supports considering changes reflecting PBGC’s financial position and its contingent liabilities.
The Chair thanked the Advisory Committee and asked the members about their points of focus. Ms. Grisi described the Committee’s agreement with the reserving concepts studied for PBGC’s single-employer program. Mr. LoCicero noted that those concepts are consistent with PBGC’s statutory missions. Mr. Tarbox discussed the importance of PBGC’s relationship with the multiemployer plan community. Ms. Boivie, Ms. Kennedy, and Mr. Obed highlighted greater participant education and awareness about the importance of PBGC’s role as a pension insurer and the impact of derisking. The Chair expressed appreciation for the Committee’s work. Secretary Yellen and Deputy Secretary Graves thanked the Committee for its focus on supporting the long-term health of the defined benefit pension system.
Next, PBGC Policy and Research Actuary Evan Inglis discussed the work being done on a reserve project for the single-employer plan program. He described the framework for this analysis, aimed at securing PBGC's ability to continue providing benefits to participants in the event of unexpectedly high future claims. Mr. Inglis reviewed the history and projected future state of PBGC’s financial position based on a wide range of economic scenarios. PBGC and the Advisory Committee are conducting this effort to enhance the agency’s financial assessment of the single-employer program and to inform discussions about the PBGC’s Investment Policy. PBGC is using stochastic modeling to evaluate the future funded status of the single-employer program and will incorporate additional risks in its future modeling.
Secretary Yellen asked about PBGC’s choice to model funding over a 10-year time horizon. Mr. Inglis explained that 10 years is PBGC’s standard projection period for its reporting and, absent significant financial change, stochastic projections over a longer period are not likely to the change the outcomes. The Chair thanked Mr. Inglis for his report.
The Chair recognized Inspector General (IG) Nick Novak. The IG highlighted an investigation matter related to OIG’s protection of participants and retirees. The case involved a man who was indicted on three federal charges for impersonating a PBGC plan participant, based on OIG’s investigation.
The Chair thanked the IG, noting the importance of identifying and preventing fraud to protect the integrity of the pension system.
In response to the Chair’s inquiry about Ernst & Young’s audit of PBGC’s financial statements, the IG reported no current findings or recommendations, noting that he is on track to issue the financial statement audit on November 15, 2024. The Chair asked whether the IG has preliminary findings on its evaluation of the annual compliance reports filed by SFA-recipient multiemployer plans. The IG is reviewing the process the agency uses to review the reports, which will be received from about 200 plans each year, and expects to issue its report by early 2025.
As there were no further questions, the Chair and the Board Members thanked Acting Director Orr and all meeting participants and adjourned the meeting.
AGENDA
JOINT MEETING OF THE BOARD OF DIRECTORS AND
ADVISORY COMMITTEE OF THE PBGC
Friday, September 13, 2024
10:00 a.m. – 11:00 a.m.
- Introduction by Acting Secretary Su and Approval of the July 16 meeting minutes
- Acting Director’s Report
- SFA Update
- Introductions from the PBGC Advisory Committee members
- Reserve Concepts Briefing
- OIG Briefing