Pedestrians walk past the main entrance to TVA in downtown Chattanooga in this file photograph from 2012.Find out moreRead the online petition online.
Employees and retirees of the Tennessee Valley Authority have mounted an online petition campaign to try to convince the federal utility to replenish its underfunded pension program.
In their appeal to Congress and the TVA board, petitioners are urging TVA to put more money into the TVA Retirement System, which actuaries estimate has promised $4.8 billion more in benefits than what the fund now has in reserves.
Robert Stalvey of Spring City, one of nearly 400 persons who have signed the petition since it began on Monday through the online platform change.com, is worried about his TVA pension.
"TVA board members are robbing the funds collected from the rate payers for the pension plan for other funding," Stalvey complained on the social media site. "This is the same as stealing and should be stopped."
The TVA retirement plan, which covers nearly 36,000 employees, retirees and family members, had assets of $7.5 billion as of Sept. 30 and has no immediate problem continuing to pay more than $600 million a year in retirement benefits to about 23,500 retirees.
But to sustain such payments over the long term, actuaries estimate TVA's retirement plan has liabilities of more than $12.2 billion. In its fiscal 2014 year end report, TVA reported that its retirement system is only about 61 percent funded, based upon projected benefit costs and investment earnings for the future.
Although TVA has adequate funds to pay current beneficiaries in the near term, TVA retiree Dan Pitts worries about the long-term future of the pension benefits he relies upon.
Pitts, a 67-year-old retired auditor at TVA, compared TVA's pension with other a half dozen other comparable electric utilities and found that TVA had the worst funded pension among those utilities. As an independent federally owned utility, TVA also doesn't have the backing of the U.S. Pension Benefit Guaranty Corp., that private pension plans enjoy or the government backing provided to other federal government pension plans.
Pitts decided to use social media to help give more voice to those pushing for TVA to shore up its underfunded pension plan. On Monday, he put up an online petition on the web site change.org, which bills itself as the world's platform for change.
By Thursday night, 363 persons had signed the petition to TVA directors and the members of the Tennessee Valley congressional caucus.
"I've been struggling for a long time to find a way to reach out to people and to find a way to help them voice their concerns about what TVA is doing," Pitts said. "I just hope this will spur the board to take some action because this has been dragging on way too long."
Pitts has picked up some congressional support his effort. U.S. Rep. Mo Brooks, R-Ala., said he wants TVA to make good on its pension promises to its employees.
"I am astonished to hear of this news (about the TVA pension shortfall) and I will follow-up with TVA leadership regarding this issue," Brooks said in a recent letter to Pitts. "Unlike many other pension plans, the TVA has the legal power to address any pension shortfall should it occur because the TVA has a monopoly over electricity and, in turn, can raise rates as necessary to fund its costs of generating electricity ... which includes pension fund costs."
TVA Chief Financial Officer John Thomas said the utility is committed to paying retirement benefits and expects both TVA contributions and investment returns should fund future obligations over the long haul.
"We'll make long-term ongoing contributions to the plan and expect to have good overall investment returns," Thomas told financial analysts last month in the 2014 financial report. "And so, I think you could expect that this will achieve a more fully funded status, but it'll be over the long-term."
In the current fiscal year, TVA expects to contribute $275 million to the plan. That is above the minimum $215 million contribution actuaries say TVA must make to the plan but below the $350 million requested by the 5-member TVA Retirement System board that oversees TVA's pension.
Last year, TVA put $250 million into the pension fund, which also exceeded the minimum requirement of $198 million, but was less than what the TVARS board recommended.
TVA pumped $1 billion into the plan in 2009 when it also made some revisions in the cost-of-living adjustments for a few years of the plan. Those changes, although approved by a majority of the TVARS board and the TVA board, have been challenged in court by a group of TVA workers and retirees who organized Save Our Retirement Inc.
That lawsuit is still pending in federal court in Nashville.
The plaintiffs claim that TVA violated its promise to provide inflation-adjusted benefits to TVA workers after they retire. TVA contends that the retirement system does not guarantee such cost of living increases.
Leonard Muzyn, a member of the TVARS board since 2003, said social media is providing a new venue for workers and retirees to express their concerns over the retirement program and what he says has been a lack of adequate financial support in recent years from TVA.
"Many TVA employees and retirees have been expressing concerns to me for years about the financial status of their pensions," Muzyn said. "Until this petition drive, I don't believe there was a good way for them to have their concerns considered by the TVA baord had a good way for their concerns."
Judith Phillips of Harrison retired from TVA in 2002 after 18 years with the utility and is one of those using the online petiiton to voice her concerns.
"I am dependent on TVA retirement along with social security to live in my senior years," she said in a blog post.
John Sullivan of Hixson said TVA collects ratepayer dollars to pay the pension program and should allocate more of its budget to restoring the financial health of the retirement plan.
"TVA is not funding the benefits promised during my TVA career dating back to 1978," he said. "Part of my electric bill payment to EPB that goes to TVA is for operating, maintenance, and fuelexpense.Pension is part of the operating expense and must be adequately funded per the budget allocations."
Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340.