TVA has twice as many retirees as current employees and the pension fund has been hammered by the collapse of the stock market during the past year. The pension board is considering eliminating the cost of living increases to retirees and eliminating a monthly payment for supplemental health insurance. The pension board is also expected to ask TVA for a huge infusion of cash in the coming years to meet obligations.
The pension board was to consider these changes at a meeting last week, but a memo circulated to retirees raised an outcry and the meeting was postponed until sometime in August. The memo says TVA is proposing to contribute up to $1 billion in the coming years if the pension board cuts liabilities by $600 million.
The supplemental insurance payments started during the 1990s and the question for the board is whether this is a vested benefit or discretionary.