Sheet Metal Workers’ National Pension Fund is Currently 81.5% Funded and has Been Certified in the Green Zone Effective January 1, 2022

Sheet Metal Workers’ National Pension Fund is Currently 81.5% Funded and has Been Certified in the Green Zone Effective January 1, 2022

The Sheet Metal Workers’ National Pension Fund (NPF or Fund) has increased its funding level year over year for a decade.  This is a result of the hard work and sacrifice of our Participants, our Local Unions, and our Employers.  It is important to celebrate this moment.  It has been a long time coming.  

There is more work to be done.  The volatile markets we are experiencing so far in 2022 demonstrate that we must continue to be vigilant in our management of the Fund to protect the retirement security of our members.  

Here are some facts about our emergence into the Green Zone:

• Although the Funding Improvement Plan is no longer applicable, Trustee approval continues to be required for any changes in contribution rates that could lower expected contributions into the Fund.  This is a requirement of the NPF Trust Document. Benefit improvements or any changes to the Plan that increase benefits, continues to be prohibited.  The NPF elected to utilize an amortization extension allowed by regulations some years ago.  Until we are no longer using this extension, the Internal Revenue Service prohibits any improvements to the Plan unless there is a corresponding contribution increase intended to fund the cost of improvement.  This prohibition applies to the Fund’s Working After Retirement rules, which means that the Fund must retain its requirement that a participant has a permanent cessation from covered employment before commencing benefits – irrespective of his or her age.  The Fund must also continue to enforce the rules limiting retirees to returning to work for up to 40 hours per month until the April following his or her attainment of age 70½.
• The Fund continues to have withdrawal liability.  Withdrawal liability is a result of the Plan not being fully funded.  The Fund, at 81.5%, is not fully funded. 
• The Fund is not expected to flip back and forth from Green to Yellow.  If, for example, 2022 continues to be a challenging year for investments and the Fund realizes an investment loss to the extent that it drops our funding level below 80%, we will not automatically be back in the Yellow Zone.  As long as the Fund is projected to return to above 80% funding level within a reasonable period of time, the Fund will continue to be certified in the Green Zone.

The certification and other information can be found on our website at smwnpf.org.  Please contact the Fund Office at (703) 739 – 7000 or at info@smwnbf.org with any questions.