WASHINGTON — The Pension Benefit Guaranty Corporation will pay retirement benefits for nearly 2,000 current and future retirees of James River Coal Company, a mining operation based in Richmond, Va.
PBGC is stepping in because the company sold the majority of its assets in bankruptcy and the buyer isn't assuming the pension plan.
PBGC will pay all pension benefits earned by James River Coal retirees up to the legal maximum 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 James River Coal Company Employees' Pension Plan will continue to receive benefits from the company until PBGC assumes responsibility.
According to PBGC estimates, the plan is 61 percent funded with $74 million in assets to pay $121 million in benefits. The agency expects to cover $44.6 million of the $47.1 million shortfall.
The company's pension plan ended as of Aug. 31, 2014.
PBGC can provide general information now and will be able to answer more detailed questions once the agency receives pension plan records. Participants in the company's plan will be notified by letter after the transfer occurs.
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James River Coal is a producer and marketer of coal in the Central Appalachia and the Midwest coal regions of the U.S. The company sought Chapter 11 Protection in the U.S. Bankruptcy Court in Richmond, Va., on April 7, 2014. The company sold the majority of its assets to Blackhawk Mining LLC following a bankruptcy court auction in August.
PBGC protects the pension benefits of more than 42 million Americans in private-sector pension plans. The agency is directly responsible for paying the benefits of more than 1.5 million people in failed pension plans. PBGC receives no taxpayer dollars and never has. Its operations are financed by insurance premiums, investment income, and with assets and recoveries from failed plans. Learn more at PBGC.gov