Central States Dispute Information

Friends and Neighbors:

The Arena Village Board believes that it is important to update you on the ongoing dispute between Central States and its demand for $418,744.33 from the Village. First, a little history on the problem. Central States Pension Fund is what is known as a Multi-employer Pension Plan, which means that many employers contribute to one large plan in order to share the risks and benefits. It is also a Defined Benefit plan, which means that the retirees are not dependent on their past contributions of the plan, but on the payments of current employed workers. This pension plan is the one our former union workers had through the Teamsters Union.

In 1980, Congress passed the Multi-employer Pension Protection Act Amendments (MPPAA). The amendment created a penalty if an employer stopped contributing to a plan. This penalty is called withdrawal liability. It requires the employer, should that employer want to leave that fund, to pay its proportionate share of the plan's unfunded vested liabilities, even if the employer had fully paid all contributions required by its employee contract.

Our current difficulty stems from the political rangling in this state over unions. Since the state of Wisconsin essentially has removed unions' ability to collectively bargain, most of the unions who were operating in Wisconsin have decertified, meaning that they no longer represent their workers as the sole bargaining agent recognized by the state. The Teamsters Union representing Arena workers was one of these unions to decertify. Their decertification ended their contract with the Village and, thereby, ended contributions to the Central States Pension Fund. Immediately, and without any action by the Village, Central States slapped a withdrawal liability demand on the Village to the tune of $418,744.33 or $2,144.27 a month for the next twenty years.

Read Central States' demand for payment here.

Some court decisions showing the federal grant of seemingly unmitigated power in respect to Central States' claims on 'withdrawals':
Central States v. LaCasse
Central States v. Waste Management of Michigan
Central States v. SCOFBP
Central States v. Bellmont Trucking
Central States v. Auffenberg Ford

An article on how poorly Central States is doing business and how much they rely on withdrawal liability payments to survive.

Please contact your state representatives about the situation that circumstances have placed us in. State Senator Dale Schultz and Representative Howard Marklein. Senators Ron Johnson and Herb Kohl. Representative Ron Kind.


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