UMWA encouraged by Senate effort to prop up retiree health care funding

United Mine Workers of America International President Cecil E. Roberts said June 30 that he is pleased with efforts in the U.S. Senate to prop up a health care fund for union retirees that has been hit hard lately by the loss of income from active unionized coal mines.

“I am very encouraged by the bi-partisan agreement yesterday by Senate leadership and members to hold a mark-up vote in the Senate Finance Committee on the Miners Protection Act,” said Roberts. “We have been asking for this action to be taken for months, because time is growing very short if the health care benefits for tens of thousands of retirees are to be saved.

“I want to commend Sen. Joe Manchin (D-W.Va.) for his strong commitment to this issue and his tireless work in the Senate to move this legislation forward. I also want to thank Sen. Shelley Moore Capito (R-W.Va.) and Sen. Rob Portman (R-Oh.) for taking this issue on and standing strong with us. In addition, Sen. Sherrod Brown (D-Oh.) and Sen. Joe Donnelly (D-Ind.) publicly stood with us on the floor of the Senate and took a courageous vote on our behalf.

“Senate leadership of both parties – Minority Leader Harry Reid (D-Nev.), Minority Whip Richard Durbin (D-Ill.), Majority Leader Mitch McConnell (R-Ky.) and Majority Whip John Cornyn (R-Tex.) came together and agreed to move this critical legislation forward yesterday. I thank them as well and appreciate this action very much.

“Now that there is an agreement to move forward in the Senate Finance Committee, I call on the committee to take up this bill and hold the mark-up without delay. I see no reason why the committee can’t take action within the next two weeks, before Congress leaves town for the summer. These retirees need to have some sense of comfort that their Congress is working for them instead of continuing to wonder if they will have the health care and pensions they were promised. Congress needs to hold the vote and pass this bill.”

Manchin, who used to be in the coal business in his home state of West Virginia, said June 29 that he had personally secured a promise of a vote on the Miners Protection Act from Democratic Senate leadership and Senate Finance Chair Orrin Hatch (R-UT).

“I am glad we will be able to vote on the Miners Protection Act and I thank the entire Democratic Caucus for working to secure an immediate vote from Finance Chair, Orrin Hatch,” Manchin said. “The guarantee that these miners received from President Truman deserves a vote before recess. By the end of this year, tens of thousands of miners will lose their health benefits – the health benefits they earned through a lifetime of hard work. Although I am happy we have secured a vote, we now must work to make this vital legislation law to make sure that our miners never receive those notices.”

On May 25,  Manchin and 28 colleagues sent a letter to McConnell calling for action on the Miners Protection Act before the summer recess. He will continue to push for a markup before the Senate goes to recess on July 16.

Retired miners are facing uncertainty because the UMWA 1974 Pension Plan is severely underfunded. Unlike other public and private pension plans, the 1974 Pension Plan was well-managed and funded prior to the 2008 financial crisis, which Manchin said was created by “Wall Street greed” and hit at a time when this plan had its highest payment obligations. This – coupled with the fact that 60% of the beneficiaries are “orphan” retirees whose employers are no longer in the coal business, and the fact that there are only 10,000 active workers for 120,000 retirees – has placed the plan on the road to insolvency. If the plan becomes insolvent, these beneficiaries face benefit cuts and the Pension Benefit Guaranty Corp. will assume billions of dollars in liabilities. The Miners Protection Act would:

  • Amend the federal Surface Mining Control and Reclamation Act to transfer funds in excess of the amounts needed to meet existing obligations under the Abandoned Mine Land (AML) fund to the UMWA 1974 Pension Plan to prevent its insolvency.
  • Make certain retirees who lose health care benefits following the bankruptcy or insolvency of their employer eligible for the 1993 Benefit Plan. The assets of the Voluntary Employee Benefit Association (VEBA) created following the recent Patriot Coal bankruptcy would be transferred to the 1993 Benefit Plan to reduce transfers from the AML fund.

At a time of an historic contraction of the coal industry, some unionized operations (mainly mines and prep plants) are being shut, and many other such operations are being stripped of their UMWA obligations through bankrupty proceedings.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.