Issue 5, 2006

2006 Trowel Trades Trust Fund Educational Conference
Teaming Up to Improve Benefits

In October, BAC health, pension, and annuity fund trustees and fund professionals joined forces at the BAC/ICE 2006 Trowel Trades Trust Fund Educational Conference to address rising health care costs, the impact of an uneven economic recovery on fund contributions, and the new pension legislation. During the day and a half conference, attendees examined the issues and problems specific to BAC funds, learned about new investment opportunities and programs, which in many cases, are designed specifically for BAC funds, discussed solutions, and heard the facts about key government-sponsored programs that offer a safety-net for members and their families.

"Social Security’s fiscal future can be stabilized.” –Theodore Marmor, Yale University Professor

The keynote speaker, Yale University Professor Theodore Marmor, kicked off the program by exposing the misinformation circulating about the future of Social Security and Medicare. “For more than two decades, conservative commentators and activists have attempted to convince the American public that these major social insurance programs are unwise, unsustainable, and ripe for major reform,” he told attendees. This is just not the case. “The real issue is not economics but political ideology.” Social insurance programs acknowledge that we are all at risk of being injured, getting old, or dying prematurely, and they allow us to pool the risk in such a way that it minimizes everyone’s risk.

Dr. Theodore Marmor, a professor of Public Policy and Management at the Yale School of Management and an Adjunct Professor of Law at Yale Law School.

Wisconsin State Senator, and BAC member, Russ Decker introduced trustees to an important health care initiative he has been working on in Wisconsin that would help control costs and ensure that more of the state’s citizens receive coverage. On November 7th Brother Decker was re-elected to the state Senate by an overwhelming majority. He was appointed Senate Co-Chair of the Joint Committee on Finance later that month. Congratulations Russ!

Critics of these programs are philosophically opposed to the pooling of risk and instead feel it should be individualized. The problem is that their proposal to privatize Social Security and create personal accounts invested in the stock market would do nothing to address the fiscal problems they keep raising, and would actually “make the fiscal situation much worse and require massive borrowing, along with large benefit reductions.” What’s worse, individualizing the risk would put the majority of citizens who rely on Social Security as the bedrock of their pension, disability income, dependent income, or life insurance at great risk. With a few modest changes “Social Security’s fiscal future can be stabilized.” 

Richard Tolson, Director of the New Jersey ADC and a fund trustee listens along with other delegates to the presentation on the proposed health care purchasing coalition.

Attendees also received a status report on the BAC Sav-Rx prescription drug program. While the Sav-Rx program has only been available since 2004, it has already produced savings, received high marks from those funds participating, and provided some added benefits that had not been anticipated at the outset, according to Sav-Rx Executive Vice President Christy Piti. “The latest numbers show that the twelve participating funds have already experienced savings of roughly $9 million,” she told attendees. BAC President John J. Flynn encouraged those funds that have not done so to give serious consideration to the Sav-Rx program since participants’ savings increase with each new person that is signed – one more example that there is strength in numbers.

Ira Mitzner, a partner with the law firm Dickstein Shapiro and an expert in the area of employer withdrawal liability under ERISA, responded to trustees’ questions regarding the special rules that apply in the construction industry.

The Conference also served as a forum to introduce the proposed health care purchasing coalition, which, taking a page from the Sav-Rx program, is structured to reduce BAC members’ health care costs without jeopardizing coverage by pooling our participants’ bargaining strength. The coalition would allow a Local fund to maintain its identity, set eligibility rules, and select the plan(s) that best meets members’ needs.

Finally, attendees received updates on several investment programs tailored to benefit BAC members and their funds, including:

• The Trowel Trades S&P 500 Index Fund offered through Comerica Bank, which provides a competitive rate of return and ensures that all proxies are voted in conjunction with the AFL-CIO guidelines, and
• The Multi-Employer Property Trust, the AFL-CIO Housing and Building Investment Trusts, Amalgamated Bank’s Ultra Construction Loan Fund, and ULLICO’S J for Jobs program – all of which invest in construction projects requiring 100% union labor.

BAC’s Proxy Voting Service received considerable attention as Greg Kinczewski of  The Marco Consulting Group, updated attendees on the success BAC funds have had in ensuring that the corporations in which they invest operate in the interest of our funds and participants.

Attendees also received an update on other programs under development, including the captive insurance company for the unionized masonry industry, details on the new pension legislation and its implications for BAC plans, what to consider during a fund merger, the status of the BAC Reciprocal Agreements (see article), and a new electronic employer reporting system for funds and contractors – eREMIT.

Mark Singleton, ULLICO’s president and CEO, updated attendees on new directions at the company, its fiscal health, and new programs and services. He was joined by senior executives, Anne Bossi, president of The Union Labor Life Insurance Company, and Daniel Aronowitz, president of Ulico Insurance Group and Ulico Casualty Company.