2019 NPF Annual Funding Notice

The 2019 Annual Funding Notice for the Sheet Metal Workers’ National Pension Fund reports that the NPF is 66.5% funded, an improvement over the previous two years.  The NPF is considered to be in “endangered” status. Under federal pension law a plan is considered to be in "endangered" status if the plan is not in critical status and, as of the beginning of the plan year, the funded percentage of the plan is less than 80 percent. 

In an effort to improve the Plan's funding situation, the Trustees adopted a Funding Improvement Plan (“FIP”), including the Funding Improvement Plan Schedule (“FIP Schedule”), effective March 1, 2014. The FIP was most recently updated as of April 2019. The FIP’s benchmarks are expected to be achieved with the current design in the Plan Document, which is reflected in the FIP Schedule.

The FIP Schedule provides three options:

• the Default Option, which currently requires no Contribution Rate increases
• the First Alternative Option, which currently requires an annual Contribution Rate increase of 7% through 2017 followed by 2% contribution rate increases in 2021 and 2022
• the Second Alternative Option, which currently requires an annual Contribution Rate increase of 3.5% through 2017 followed by 1% contribution rate increases in 2021 and 2022.

These Contribution Rate requirements, as well as other provisions of the FIP, including the FIP Schedule, are subject to change in the future should the Trustees consider it necessary to achieve the benchmarks.
Under the Pension Protection Act, contribution rates established under a particular schedule in collective bargaining agreements will remain in effect for the duration of the CBA.  This is true, even though the trustees may have revised the alternative schedule, to require additional contribution increases.

2019 NPF Annual Funding Notice