The New Year will bring an increase in earned benefits for all active AMO members vested in the defined benefit AMO Pension Plan.

Under an agreement reached by the joint union-employer trustees of the AMO Pension Plan in October 2019, monthly benefits calculated for active members vested in the Plan when it was suspended as deficient under the federal Pension Protection Act of 2006 in December 2009 will rise by 10 percent on January 1, 2020.

This one-time benefit increase was made possible when the AMO Pension Plan reached the federal law's "green zone" funded status at the close of its fiscal year on September 30, 2018. This benefit increase will not impair the AMO Pension Plan's ability to meet its obligations to current retirees, to retiree survivors, or to vested individuals no longer working in AMO covered employment but eligible for benefits at age 65.

The AMO Pension Plan's funded status as of December 31, 2019, was approximately 85.5 percent.

Meanwhile, a proposal to exempt active AMO members with 20 years or more of service from an Internal Revenue Service rule governing defined benefit distributions remained under bipartisan senior staff review in the House Ways and Means Committee (from which all tax legislation must originate) and the House Education and Labor Committee (which has immediate jurisdiction over pension issues) at the New Year break.

Under the proposed exemption - pending since August 2019 - AMO members qualified for strategic sealift services would have the option of receiving earned monthly benefits from the AMO Pension Plan while remaining at work at sea. These AMO members would be permitted to roll these earned benefits directly into their individual Money Purchase Benefit defined contribution accounts, where they would grow through return on self-directed investment. There would be no tax consequence for these AMO members until withdrawal from these accounts upon actual retirement, at which point the direct rollover would end.

In the case of AMO engineers active on the Great Lakes - where there is a fleet-wide AMO 401(k) Plan employer match but no MPB participation - monthly benefits from the AMO Pension Plan would be rolled over directly to individual AMO 401(k) accounts or to other qualified defined contribution accounts.

IRS approval of this proposal would serve legitimate national security interests by easing a dangerous and growing shortage of civilian American merchant mariners - the "first responders" in defense emergencies. Comparable exemptions exist for law enforcement officers, firefighters, emergency medical personnel and other first responders in some public sector pension plans.

The AMO proposal would encourage sealift-ready AMO members to remain in their jobs and available for military support services in an overseas crisis. It would address immediate Defense Department and Congressional concerns about the ability to activate the Maritime Administration's Ready Reserve Force and Military Sealift Command's surge fleet during mobilization.

In a related development, the joint union-employer trustees of the AMO Defined Contribution Plan in the first quarter of 2020 will continue deliberations on proposals to calculate individual DC Plan benefits on length of service exclusively. Age would no longer be a factor.

New Year marks sixth consecutive year without dues increase

2020 marks an unprecedented sixth consecutive year without an increase in AMO membership dues or a hike in AMO initiation fees.

This reflects both sound administrative management of AMO assets and an increasing rate of timely membership dues and applicant initiation fee payments.

On behalf of the AMO National Executive Board, all AMO reps and all support staff personnel, I wish all AMO members, their families and their friends a happy, healthy New Year 2020.

Paul Doell
National President