WASHINGTON, D.C. - The "Do-Nothing Congress" has generally earned its nickname over the past several years. But when it comes to throwing a lifeline to the nation's struggling pension plans, a few things are getting done.

As evidence, permit us to introduce the "Composite Retirement Plan," a concept released last month in the form of a "discussion draft"  by the U.S. House Committee on Education and the Workforce. Chairman John Kline (R-Minnesota) said the draft "reflects input from employers, worker representatives, and retiree advocates. This proposal will provide more retirement choices for workers, more flexibility for employers, and greater protection for taxpayers. It reflects the input of business and labor leaders, as well as retiree advocates who have long recognized the need to strengthen retirement security."

According to a talking points memo related to the plan released by the Sheetmetal and Air Conditioning Contractors Association, composite plan benefits would be paid in the form of lifetime annuities that can work alongside traditional pension plans.

SMACNA points out that the composite plan design is "simply another tool for plans trustees to use to secure long-term retirement benefits for participants." Such plans would:

*Provide a lifetime benefit, paid as an annuity. Existing multiemployer plans like those held by building trades unions would not go away, but could co-exist with the annuity.

*Allow voluntary participation in such a composite plan by pension plan trustees.

*Be required to be funded at 120 percent, to safeguard against severe market declines. In such a decline, the plans would allow for "modest" reductions in benefits early in order to prevent catastrophic benefit reductions later. Lump sum payments would not be allowed.

Benefits can be increased when a plan is expected to be 120 percent funded in 15 years.

An annuity, according to Investopedia, is a contract between you and your insurance company in which you make a lump sum payment or series of payments, and in return obtain regular disbursements beginning either immediately or at some point in the future. One disadvantage with traditional annuities are that they're known to be laden with high fees. According to SMACNA, the assets of the composite annuity plans would be professionally managed without the fees associated with individual accounts, "resulting in far greater efficiency than is available in traditional defined contribution plans."

The talk about composite plans stems from the difficult financial shape in which many multiemployer pension plans find themselves. There are about 10.5 million workers and employers who are participants in multiemployer plans, most of them in the construction industry. The role of the federal Pension Benefit Guaranty Corp. is to backstop benefits of failing pension plans, but it is increasingly unable to fully fund those benefits. In 2014, the PBGC had $818 billion in benefit liabilities vs. $397 billion in assets. To date, the PBGC has provided financial assistance to more than 70 failed multiemployer plans, but the benefit level is often only about half of what a pensioner would receive if his plan were still solvent.

"Allowing firms and their workers to voluntarily adopt similar (composite) plans will give firms that may be hesitant to assume the kind of liabilities associated with defined benefit plans another reason to participate in multi-employer retirement plans," said Associated General Contractors CEO Stephen Sandherr. "This will not only strengthen retirement benefits for countless workers, it will also reduce the reliance on the Pension Benefit Guarantee Corporation to buttress troubled plans."

Workforce, existing multiemployer pension plans facing severe financial challenges - those in the "Red Zone" (less than 65 percent funded) - would not allow any existing plan in critical status to transition to a composite plan design. This prohibition also applies to existing plans that are expected to be in red zone status within a five-year period. An existing pension plan would have to be 100 percent funded before it could start a composite plan.

Rep. Kline's explanation of the composite plan said "instead of extending a system that can lead to significant risk and broken promises, this proposal provides a different approach. Retirees will be accruing and earning a benefit that they know is expected to change, much like 401(k)s have for decades. However, by including strict funding requirements that will ensure composite plans are responsibly managed, the proposal will provide retirees greater certainty and financial stability for the years ahead. This proposal will provide one more option to help individuals retire with financial security and peace of mind."

According to Segal Consulting, a benefits consulting firm, there are advantages for employers in the legislative proposal. "There has been growing concern in the multiemployer plan community about the ability to attract new employers to, and retain existing employers in, multiemployer defined benefit plans due to plan underfunding, with specific concerns  regarding 'legacy costs' and withdrawal liability. The composite plan design is intended to  help address that concern with a plan-design option that plan sponsors could adopt voluntarily.

"The plan-design option provides an annuity benefit, but limits  an employer’s financial obligation to its fixed, negotiated contribution level. It also  eliminates both the withdrawal liability 'exit fee,' should the employer decide to leave the plan, and the  penalties if plan funding drops too far."

 Other stakeholders are wary of composite plans, according to Benefits Pro. The group said a letter to members of Congress signed by the Pension Right’s Center, which advocates on behalf of retirement plan participant rights, and several prominent trade unions, expressed “strong opposition” to composite plans, and urged members not to consider the “flawed” proposals in the discussion draft.

The draft’s proposals would weaken existing funding standards, allow sponsors to escape paying penalties for withdrawing from plans, and leave new workers enrolled in composite plans with inadequate protections, the letter said.

“Our organizations do not oppose new forms of retirement savings plans,” the letter opposing Kline’s discussion draft said. “However, we do oppose proposals that permit employers and plans to adopt new plans while putting at greater risk the funding of already unfunded pension promises in existing plans.”

The House committee is requesting public input on the proposal, as well as receiving ideas for reform of the PBGC.