WASHINGTON (AP) -- House Republicans advanced legislation Thursday that would overhaul the rules governing private pension plans, even as Democrats said they hadn't had sufficient time to assess it and voted ''present'' in protest.
The measure, passed the same day the federal Pension Benefit Guaranty Corp. assumed liability for United Airlines' pension plans, aims to reduce similar pension defaults in the future.
It requires corporations to use a new interest rate when measuring their future pension obligations; curbs increases in benefits promised from underfunded plans; increases premiums paid to the PBGC, the federal agency that insures pension plans; and enhances public disclosure of information about severely underfunded plans.
In addition, the bill creates funding targets for multi-employer pension plans, in which companies band together to provide a single pension plan for laborers who may bounce between them. The legislation also establishes ''yellow'' and ''red'' zones for especially underfunded pension plans and outlines steps and timetables for rehabilitating them.
Rep. John Boehner of Ohio, the Republican chairman of the House Committee on Education and the Workforce, said he expected the multi-employer language ''to be the rocket fuel that will propel this through the Senate.'' He also said that if the bill is not folded into larger House retirement security legislation, including Social Security changes, he will seek to have the House vote on a standalone bill.
Boehner said the measure ''puts us on the fine line'' between bolstering protections for employees expecting pensions and avoiding regulation that discourages employers from offering continuing defined-benefit plans, in which an employer guarantees a set monthly payment upon a worker's retirement. Roughly 34 million people _ about 20 percent of the nation's work force _ expect to receive such retirement payments.
In May, United defaulted on $9 billion in pension obligations, which will be shifted to the PBGC. The corporation, which has a deficit of $23.3 billion, will only pay about $6.6 billion in benefits to 120,000 current and retired United employees because of limits in its insurance coverage.
The House legislation was unveiled June 9. It now moves to the House Ways and Means Committee for review.
Committee Democrats, led by their highest-ranking member, Rep. George Miller of California, complained they did not have sufficient time to review the legislation. They also saw the panel's Republican majority steamroll all of their proposed amendments on party-line votes.
''This is not casual legislation,'' Miller said before the final 27-22 roll-call vote on the bill, in which all Democrats voted ''present.'' ''This is legislation that is seriously dealing with the retirement nest eggs and the futures of millions of Americans.''
Neither the bill nor stiffer legislation proposed by the White House outlaws such ''distressed terminations,'' under which a court can allow a company to default on its pension obligations if that will enable it to emerge from bankruptcy.
Committee Democrats argued that other airlines may follow United's lead. Among their defeated amendments were ones that proposed executive and rank-and-file pension plans suffer equally in the event of a termination, and that the committee scrap language allowing firms that provide investment advice to executives to also provide advice to employees.
Unions in particular objected to that proposal, saying it could encourage a conflict of interest between a corporation's goals and an employee's interests.
''There's no reason to change from the current rules to provide conflicted advice,'' said Rep. John Tierney, D-Mass., who offered the defeated amendment.
The Pension Protection Act (H.R. 2830) is intended to fix outdated worker pension laws and protect the interests of workers, retirees, and taxpayers.
The legislation gives special repayment breaks to the airline industry.
The 279-131 vote came only hours before the House was expected to begin a five-week summer break.
One unresolved issue was whether to give a special break for financially struggling airlines.