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Board of Trustees
Carpenters District Council of Kansas City Pension
Fund
3100
Broadway Suite 805
Kansas City, Missouri 64111
Telephone: (816) 756-3113
Fax: (816) 777-2655
Toll Free: 1-866-756-3313
Important Pension Plan Changes Effective April 1, 2007:
Dear Participant:
The Pension Plan is designed to provide you with retirement income to
reward you for your work as an active employee - and it's important that
the Plan remains financially strong to pay benefits to current and
future retirees. As Trustees of your Pension Plan, it is our
responsibility to continually review the Plan to ensure its long-term
financial stability in order to provide you with income during
retirement.
Market Impact On
The Fund
As you know, strong investment returns during the mid-to late- 1990s
helped most retirement plans grow, including ours. However, as a result
of the effects of 9/11 and an overall downturn in the economy during the
early 2000s, Pension Plan assets realized significantly lower and/or
negative rates of return, despite careful investing.
While recent investment experience has been more favorable, our Plan has not yet fully recovered from the losses and low returns that occurred previously. As a result, we have reviewed the Pension Plan and are modifying the Plan effective April 1, 2007, as described below. These changes are designed to maintain the Pension Plan's assets allocated to pay future benefits.
IMPORTANT - The changes described in this announcement do not affect participants who are already receiving a pension benefit from the Fund. Additionally, these changes do not change the benefits you earned before April 1, 2007.
Supplemental
Funding Contribution Change
We are pleased to announce that the supplemental funding contribution
will be lowered from $0.65 to $0.40, and the $0.25 difference will be
used to calculate benefit accruals. This change will be effective on
dates in 2007 based upon the collective bargaining agreements requiring
contributions to the Fund. The agreements and dates include the
following:
| April1, 2007 | May1, 2007 | ||
| Kansas City Area | St. Joseph Area | ||
| Joplin Area | AGC Outstate Heavy | ||
| Springfield Area | |||
| Central Missouri Area |
If you work under a Shop Agreement, a Special Agreement or any agreement not listed above, you should contact the Fund Office regarding the date your "funding contribution" will change.
Regular Pension
Multiplier Changing
A multiplier of 1.5% will be used to calculate pension benefits earned
on and after April 1, 2007. If you worked on or after April 1, 2007,
calculate your monthly Regular Pension benefit beginning April 1, 2007,
as follows*:
| STEP 1: | For Service Between April 1, 1968 and March 31, 2000: Multiply the amount of contributions made on your behalf during this period by 3.65%. | |
| STEP 2: | For Service Between April 1, 2000 and March 31, 2005: Multiply the amount of contributions made on your behalf during this period by 3.35%. | |
| STEP 3: | For Service Between April 1, 2005 and March 31, 2006: Multiply the amount of contributions made on your behalf during this period by 2.5% (excluding "funding contributions"). | |
| STEP 4: | For Service Between April 1, 2006 and March 31, 2007: Multiply the amount of contributions made on your behalf during this period by 2.3% (excluding "funding contributions"). | |
| STEP 5: | For Service On and After April 1, 2007: Multiply the amount of contributions made on your behalf during this period by 1.5% (excluding "funding contributions"). | |
| STEP 6: | Add the amounts calculated in steps 1 through 5 above. Please note that this amount may be reduced for early commencement if you receive your benefit before age 61. |
* If you have a break in covered employment or earned past service (service earned before the Contribution Date), your benefit may be calculated differently. Contact the Fund Office for more information.
|
Example:
John retires on April 1, 2008, at age 61 after 15 years of
service. Assuming he has not had a break in service and has
earned no past service, here's how his Regular Pension is
calculated:
|
||
| Step 1: |
For John's Service Between April 1, 1968 and
March 31, 2000: 3.65% x $36,000 (employer contributions made during this period on John's behalf) = $1,314.00 |
|
| Step 2: |
For John's Service Between April 1, 2000 and
Mach 31, 2005: 3.35% x $24,000 (employer contributions made during this period on John's behalf) = $804.00 |
|
| Step 3: |
For John's Service Between April 1, 2005 and
Mach 31, 2006: 2.5% x $5,600 (employer contributions of $5,950 less "funding contributions" of $350 made during this period on John's behalf) = $140.00 |
|
| Step 4: |
For John's Service Between April 1, 2006 and
Mach 31, 2007: 2.3% x $5,600 (employer contributions of $6,510 less "funding contributions" of $910 made during this period on John's behalf) = $128.80 |
|
| Step 5: |
For John's Service On and After April 1, 2007: 1.5% x $5,950 (employer contributions of $6,510 less "funding contributions" of $560 made during this period on John's behalf) = $89.25 |
|
| Step 6: |
John's Total Monthly Benefit (before reduction
for any forms of payment): $1,314.00 + $804.00 + $140.00 + $128.80 + $89.25 = $2,476.05 |
|
If you have questions about the changes described in this announcement, please call the Fund Office.
Sincerely,
The Board of Trustees