WASHINGTON — The Pension Benefit Guaranty Corporation (PBGC) has assumed responsibility for The McClatchy Company Retirement Plan, which covers over 24,000 current and future retirees. The California-based newspaper publisher operates 30 media companies in 14 states.
“PBGC’s mission is to help protect the retirement security of millions of the nation’s workers, retirees, and their families; and that’s exactly what we have spent months doing in the McClatchy bankruptcy,” PBGC Director Gordon Hartogensis said. “By assuming responsibility for the plan, we are securing the benefits of the McClatchy plan’s participants.”
On February 13, 2020, The McClatchy Company and 53 subsidiaries filed for Chapter 11 protection in the U.S. Bankruptcy Court in Manhattan. On August 4, 2020, the bankruptcy court approved the sale of substantially all assets of McClatchy and its subsidiaries, leaving no entity to support the pension plan. PBGC has stepped in to terminate the pension plan and become statutory trustee to protect the interests of the participants. The termination of the pension plan was effective as of August 31, 2020.
The agency estimates that McClatchy’s plan is 57 percent funded with approximately $1.3 billion in assets and $2.3 billion in benefit liabilities. The plan is underfunded by $1 billion.
Retirees will continue to receive benefits without interruption, and future retirees can apply for benefits as soon as they are eligible. Until PBGC assumes responsibility for the pension plan, participants with questions about their benefits should contact Kurtzman Carson Consultants LLC at 866-523-2951 or email McClatchyRetirementPlanInfo@kccllc.com.
PBGC will pay pension benefits earned by McClatchy’s current and future retirees up to the legal limits. For additional information, see Questions and Answers for Participants for the McClatchy Company Retirement Plan.
The anticipated claim resulting from termination of the McClatchy pension plan was not included in the agency’s FY 2019 year-end financial statements, in accordance with generally accepted accounting principles, and will be reflected in PBGC’s FY 2020 year-end financial statements.
PBGC protects the retirement security of over 35 million American workers, retirees, and beneficiaries in both single-employer and multiemployer private-sector pension plans. The agency’s two insurance programs are legally separate and operationally and financially independent. PBGC is currently responsible for the benefits of about 1.5 million people in failed pension plans and receives no taxpayer dollars. The Single-Employer Insurance Program is financed by insurance premiums, investment income, and assets and recoveries from failed single-employer plans. The Multiemployer Insurance Program is financed by insurance premiums and investment income. For more information, visit PBGC.gov.