The promise of a full and dignified retirement has been restored for members of Niagara Falls, N.Y., Local 237, thanks to the local’s determination and IBEW-backed federal legislation that shores up pensions.
Entire industries were hollowed out in the local’s Western New York jurisdiction in the past two decades, sending ripples of economic damage through the trades. Local 237 leadership tried putting money back into the pension at different points, but nothing seemed to stop the downward spiral. By 2019, only two options remained: Let the fund go insolvent or make some serious cuts.
“It was a terrible feeling,” said Local 237 Business Manager John Scherrer, who ran for office in large part to help rescue the plan. “If our pension would’ve went away, our local would’ve went away.”
First, the local applied for assistance through the Multiemployer Pension Reform Act, which allows plans like Local 237’s that are in critical status to suspend benefits to avoid insolvency. The application was approved in 2020, and membership voted to go ahead with the cuts, knowing it was a necessary, if dire, action to take.
“It hurt all the way around,” said Local 237 retiree David Naus of the decision to take a roughly 25% cut in benefits that would give the apprentices and younger workers some type of pension in the future. “We were all going to lose something.”
For retiree David Saph, a third-generation IBEW member and Air Force veteran, those cuts meant he and his wife had to take a long, hard look at their own budget. They reduced overhead where they could and paid down some debt, but they still ended up selling their house.
“It changed my life a lot,” Saph said. “When I was young, I didn’t know what a pension was. Now that I’m here, I understand it. Without a pension, you’re going nowhere.”
“When I was young, I didn’t know what a pension was. Now that I’m here, I understand it. Without a pension, you’re going nowhere.”
Enter the American Rescue Plan. The pandemic relief bill, signed into law by President Joe Biden in 2021, included IBEW-backed legislation called the Butch Lewis Act — championed by labor allies including Sen. Sherrod Brown of Ohio — to offer relief to certain multiemployer pensions.
Scherrer said the local was initially hesitant to take the aid. It seemed at first that the help would come at the cost of the future health of the fund.
“We didn’t want to take the money and leave our apprentices with nothing,” Scherrer said.
Seeing an opening, the local submitted a letter during a comment period regarding implementation of the law to explain its situation. Those comments were addressed, and in the final version, certain pension plans, including Local 237’s, were allowed to use a different calculation that would let them take the financial assistance they urgently needed without potentially curtailing the fund down the road.
In the end, they received just over $32 million, enough money to put the pension back on track while also paying back the retirees who had taken cuts.
“I didn’t know exactly how it was going to work, but it meant my pension wasn’t going to end in 2027,” Saph said. “I thank God every day for that.”
For retirees like Gerry Manzi, the ARP wasn’t just the right thing to do, but it also corrected for outcomes like deregulation and automation that impacted multiemployer pensions like theirs through no fault of their own.
“It’s our money,” Manzi said. “We negotiated this. You gotta pay the people that are retired.”
For a lot of younger workers, the idea of a pension can seem as antiquated as a rotary phone. Only about one in 10 Americans working in the private sector has one.
But public views may be shifting. While they weren’t ultimately successful, members of the United Auto Workers called for expanding their defined-benefit plan to those hired after 2007 in their recent contract negotiations.
The job-search platform Indeed found that more people are searching for such a benefit, and more job postings are mentioning pensions.
When the ARP passed, it did so without a single Republican voting for it. It’s something Scherrer said he reminds his members of.
“He saved the most important thing to each member — our pension,” Scherrer said of President Joe Biden, who pushed for the pension provision and signed the bill into law.
It’s a sentiment shared by a lot of retirees, including Naus, who sat on the pension board before retiring in 2016.
“They’ve all helped us,” Naus said of Democratic New York Sens. Chuck Schumer and Kirsten Gillibrand, along with Rep. Brian Higgins, another New York Democrat, who shepherded the bill through their respective Houses in Congress. “Believe in the system. … There is an end to the tunnel.”
With multiple large projects in the area and more coming — thanks in large part to legislation like the Inflation Reduction Act, the CHIPS and Science Act, and the infrastructure law — job prospects for Local 237 are strong and should continue to be so for years to come.
That’s good news for today’s young workers and the future of the pension plan. Scherrer said the local’s fund is earning more money than predicted when it got the aid, and it’s bringing in more apprentices than expected. And they’ve even got a new training center to teach the next generation of members.
“The work is the best I’ve seen in my whole career,” said Scherrer, who started as an apprentice in 1995. “We definitely have a bright future. I got no worries now.”
