After watching and worrying about the declining funding level for TVA's pension program, Mike Moseley decided last week to try to get Congress to do something about it.
Moseley, a 35-year TVA employee who retired in 2002 as manager of TVA's Johnsonville Fossil Plant, started an online petition Friday asking Congressional members from the seven-state TVA service territory to investigate the TVA retirement system, which provides pension benefits to 23,700 TVA retirees and covers another 10,900 current TVA employees.
Already the petition has collected more than 1,000 signatures from TVA employees, retirees and family members worried about the status of the fund. Moseley expects to get far more and is hoping to pressure Congress to demand better answers from TVA.
TVA Chief Financial Officer John Thomas told investors on a conference call last month that TVA would honor its commitments and fund its retirement obligations even though the fund currently has just over half of as much money as it needs to pay all of its future obligations.
Moseley said he and others are worried about counting on those words when TVA opted not to put much new money in the plan last year despite record high profits of $1.1 billion for the federal utility.
"TVA says it will honor its commitments, but the funding level for the retirement plan continues to decline and is in much worse than any neighboring utility," Moseley said. "I hear the voice of Oz behind the curtain in the Emerald City, but I want to see and hear more than that."
The TVA retirement system is more underfunded than any other Southern utility.
In its financial report for fiscal 2015 released last month, TVA reported that its pension program had only 53 percent of the recommended funds actuaries estimate are needed to meet all of the future obligations of the program. TVA is $6 billion short of what the program needs according to actuaries.
TVA contributed $282 million to its pension plans in 2015, up from $256 million in 2014. But those contributions were more than offset by $762 million of investment losses in the pension portfolio in fiscal 2015 and were less than half the $690 million paid to retirees during the past year.
"The TVA has underfunded the TVA Retirement System for the past eight years and it is at the lowest level in the history of the TVA," says the petition. "As our elected officials, we turn to you and ask that you give due consideration to our concerns and take all necessary steps, including congressional hearings, and other due diligence to hold TVA accountable for its promises to us. After all, we were accountable for our promises."
Unlike private pension funds which are guaranteed and regulated by the Pension Benefit Guarantee Corp., TVA as a government agency does not have such insurance. TVA is able to raise rates as its board determines necessary, however, and TVA's overall financial health has improved in recent years, Thomas said.
TVA is an independent agency owned by the federal government. But the utility is self-financing from the sale of the electricity it generates and TVA no longer receives any taxpayer funds from Uncle Sam.
U.S. Sen. Lamar Alexander, the senior senator from Tennessee and chairman of the Senate Committee on Health, Education, Labor and Pensions, noted that the TVA board appointed by the president controls the operation of the utility and its finances.
"The level of TVA pension funding has been a matter of concern for several years, and Sen. Alexander believes it is important that TVA's board continues to address this issue so TVA employees and retirees can continue to count on the health and stability of the pension fund," said Louie Brogdon, Alexander's press secretary.
TVA retirees say they want Congress to do more to pressure the TVA board to better fund the pension plan for most employees.
"I'm very concerned about the shortfall in TVA's pension that seems to be brushed over each year by TVA executives and (is) not a concern for them since the separate retirement plan for senior executives is fully funded," said Carl Scarbrough, a former TVA employee who retired last year and now lives in Hixson. "This pension is what I and thousands of retirees are counting on for my income for the next 35-40 years, but I'm concerned that continued under-funding and shortfall is jeopardizing this future income."
Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340.