Companies May Save Billions With Passage of Pension Reform=20
Associated Press (01/21/04) ; Durbin, Dee-Ann

Congressional lawmakers are working on providing companies with help funding their pensions, many of which have been left underfunded. Legislation that could soon be approved by the Senate would allow companies to contribute less to their pension funds for the next two years by allowing companies to calculate their pension obligations using a corporate bond index. Companies have traditionally used the 30-year Treasury bond rate, with a 2 percent to 3 percent return rate, to calculate their pension obligations, but the corporate bond index would provide companies with a rate of return of around 6 percent. Over 200 companies, many of which stand to receive significant pension savings under the proposed change, have signed a letter urging Senate lawmakers to approve the pension relief measure.

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