Fight is still on for Delphi salaried retirees

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Congressman Chris Lee stopped by Lockport on Wednesday to address retired salaried Delphi employees. Lockport Mayor Michael Tucker, a retired Delphi employee himself, and Jim Frost, the vice chair of the Delphi salaried retirees association, joins Chris Lee at the podium to discuss progress on the pension problems. Joe Eberle/US&J
Congressman Chris Lee stops by Lockport on Wednesday to address retired salaried Delphi employees. Joe Eberle/US&J
Congressman Chris Lee stopped by Lockport Wednesday to address retired salaried Delphi employees. Dave Macphee, a retired Delphi engineer joins the podium with Lee and Mayor Michael Tucker. Joe Eberle/US&J
Congressman Chris Lee stops by Lockport Wednesday to address retired salaried Delphi employees, some of whom join him at the podium. Joe Eberle/US&J

August 5, 2010

By Joe Olenick Lockport Union-Sun & Journal The Lockport Union-Sun %26 Journal Thu Aug 05, 2010, 02:22 AM EDT

Delphi salaried retirees aren’t giving up the fight for the pensions just yet.

One of the group’s biggest supporters, U.S. Rep. Chris Lee R-Clarence, visited Lockport City Hall on Wednesday to share the next step in the fight. Lee mentioned President Barack Obama’s speech last week touting the revival of the auto industry — but he was leaving something out, the congressman said.

“Nobody is more pleased than myself in sharing that we have a strong and vital manufacturing base in this country,” Lee said. “But the problem that irks me is the fact that while we’re popping the champagne cork, we’re missing one of the single biggest issues that occurred. One of the biggest travesties is the fact that during the bankruptcy proceedings for GM, one group, frankly, was thrown under the bus.”

In July 2009, the roughly 22,000 salaried retirees nationwide found out their pensions were going to be turned over to the federal Pension Benefit Guaranty Corp., as part of the bankruptcy emergence plans for General Motors and Delphi. The move led to cuts ranging from 30 percent to 70 percent.

For the past 16 months, retirees have been trying to find out why. They’ve gained support in Congress, and two hearings have been held on the topic. Still, the retirees have not heard anything from the White House, the U.S. Treasury Department or the Auto Task Force, the group put together by the Treasury Department to oversee the revival of the auto industry.

Now the retirees and their supporters are looking for help from a new source. Supporters are going to reach out to the Special Inspector General for the Troubled Asset Relief Program. The program’s head, Neil Barofsky, investigates issues with TARP-funded programs, such as the Auto Task Force. Lee has sent a letter to Barofsky.

The plan is to have Barofsky look at the timing of the bankruptcy emergence of GM and the PBGC’s release of liens on Delphi assets, which was reportedly worth billions. Lee said that could have helped Delphi’s pension plan.

Lee said he has introduced a bill in the House of Representatives asking the Governmental Accountability Office to require the Treasury Department and Auto Task Force to provide all information on how the pension decision was reached.

“These documents are critical as to why Delphi workers and retirees lost up to 70 percent of their pensions,” Lee said.

The pension cuts already have been felt by retirees. Daniel McCarthy, who retired last year after 32 years with Delphi and General Motors in Lockport, said he lost 75 percent of his pension. McCarthy retired at 49 and was counting on his pension as income as he started a second career, something typical with the salaried retirees, he said.

“There a lot of retirees out there in their early to mid-50s, who have 30-year retirements,” McCarthy said. “Clearly it changes our plans.”

James Frost, a retiree who is the vice chairman of the Delphi Salaried Retiree Association, is facing a 30 percent cut in his pension. The DSRA formed after retirees discovered they were losing their health and life insurance benefits on April 1, 2009.

The retirees have sued in federal court in Michigan to stop the PBGC from reducing the pensions. Frost said the case is moving forward, as Judge Robert Drain ruled the lawsuit could continue. GM and Delphi had attempted to stop the case from moving on.

“Hopefully, it’ll force out the information we’ve been looking for,” Frost said.

Hourly employees’ pensions were also turned over to the PBGC and were topped off by GM. The UAW has said it fully supports the salaried workers’ fight, as UAW President Ron Gettelfinger sent a letter saying so in January. Lee said he ultimately hoped GM could top off the salaried pensions — but at the very least, people should know why.

“It’s an issue of fairness, figuring it out and explaining it to the American people,” Lee said.

Contact reporter Joe Olenick at 439-9222, ext. 6241.

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