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Joint Meeting Of The Pension Benefit Guaranty Corporation (PBGC) Board Of Directors And Advisory Committee - September 17, 2018 10:00 AM – 11:00 AM

Joint Meeting Of The Pension Benefit Guaranty Corporation (PBGC) Board Of Directors And Advisory Committee - September 17, 2018 10:00 AM – 11:00 AM

Department of Labor
R. Alexander Acosta, Secretary of Labor and Chair of the PBGC Board of Directors
Patrick Pizzella, Deputy Secretary of Labor 
Preston Rutledge, Assistant Secretary, Employee Benefits Security Administration
Pedro Allende, Counsel to the Secretary
Edward Wilkinson, Chief of Staff, Employee Benefits Security Administration
Ali Khawar, Senior Policy Advisor, Employee Benefits Security Administration
Nicole Swift, Employee Benefits Law Specialist, Employee Benefits Security Administration

Department of the Treasury
Steven T. Mnuchin, Secretary of the Treasury
Kipp Kranbuhl, Acting Assistant Secretary for Financial Institutions
Philip Quinn, Senior Financial Analyst, Office of Financial Institutions Policy
W. Moses Kim, Director, Office of Financial Institutions Policy

Department of Commerce
Wilbur Ross, Secretary of the Department of Commerce
Karen Dunn Kelley, Under Secretary for Economic Affairs
Regina Powers, Economist, Economics and Statistics Administration
Ken White, Policy Analyst, Economics and Statistics Administration

PBGC 
Tom Reeder, Director
Judith Starr, General Counsel and Secretary to the Board
Ann Orr, Chief of Staff
Michael Rae, Deputy Chief Policy Officer
John Greenberg, Chief Investment Officer
Bob Scherer, Chief Information Officer
Karen Morris, Chief of Negotiations and Restructuring

PBGC Advisory Committee
Robin Diamonte
Henry Eickelberg
Joyce St. Clair
Donald Butt (consultant)
Babette Ceccotti (consultant)
Regina Jefferson (consultant)

PBGC Office of Inspector General 
Bob Westbrooks, Inspector General
Nick Novak, Deputy Inspector General

PBGC Office of the Participant and Plan Sponsor Advocate
Constance Donovan, Participant and Plan Sponsor Advocate
Camille Castro, Associate Participant and Plan Sponsor Advocate

The Chair called the meeting to order, welcoming all attendees. He invited a motion to approve the minutes of the July 24 board meeting, which was made, seconded and passed.  The meeting then proceeded in accordance with the established agenda (Attachment 1).

Advisory Committee Chair Robin Diamonte presented the Advisory Committee’s recommendations on changes to the Investment Policy Statement for the single-employer program.  Ms. Diamonte explained PBGC’s liability driven investment strategy and the glide path it is on to optimize the portfolio to attain funding self-sufficiency for the single-employer program.  The changes are intended to clarify how to execute the strategy and not to change the strategy itself.  They clarify the asset allocation changes that occur as risks are reduced in the PBGC investment portfolio and recognize that funding can fluctuate over time.

The Chair thanked the Advisory Committee members for their incredibly important work.  He informed them that the Board will take the recommendations under advisement and circle back if there are any questions, and he commended the clarity of the presentation.

Director Reeder updated the Board on the work of the Joint Select Committee on the Solvency of Multiemployer Plans and current legislative efforts directed at retirement security.  He discussed PBGC’s newly-published final rule on multiemployer mergers, and how PBGC-facilitated mergers can help critical and declining plans.  In response to a question from the Chair, Director Reeder advised that he concurs with the Advisory Committee’s investment policy statement recommendations.  He and the Chair agreed that care must be taken to avoid overconfidence during good financial times to ensure funding self-sufficiency in the long term.

Inspector General Bob Westbrooks reported on the work of his office, including a letter to the Joint Select Committee discussing approaches to the multiemployer crises as seen from OIG’s unique perspective.  He discussed a Risk Advisory OIG issued on data loss protection at contractor-run facilities.  He also advised the Board of ongoing work by OIG and the PBGC Office of Information Technology to recraft old recommendations to more accurately reflect current conditions. In response to a question from the Chair, the Inspector General observed that contractors can and should do more to heighten IT security. The Chair responded that IT security is within PBGC’s control and requires strong, affirmative language in its contracts to make contractors responsible for enforcing it.  

Noting that the investment strategy must serve the agency through both good times and bad, the Chair thanked the Advisory Committee for recommendations that remind the Corporation not to become overconfident.  He then requested a motion to adjourn; the motion passed, and the meeting adjourned. 

 

 

 

Attachment 1

 

AGENDA

 

JOINT MEETING OF THE PENSION BENEFIT GUARANTY CORPORATION (PBGC)

BOARD OF DIRECTORS AND ADVISORY COMMITTEE

 

September 17, 2018

10:00 AM – 11:00 AM

 

 

 

  1.  Introduction by Secretary Acosta
  2.  PBGC Advisory Committee Investment Policy Statement Recommendation
  3. Director’s Report
  4. OIG Update
  5. Executive Session
Last updated December 20, 2018