US Airways bailout plan risks pensions nationwide, official says WASHINGTON (AP) =97 A plan to help bail US Airways out of bankruptcy by=20 extending its employee pension payments would risk retirement security for= =20 44 million Americans, federal officials told a Senate hearing Tuesday. But= =20 Pennsylvania's two senators, pushing to revise federal tax laws to give the= =20 financially embattled airline a 30-year cushion to pay $3.1 billion in=20 pension obligations, responded that the federal benefits fund would pick up= =20 the bill anyway if US Airways goes belly-up. At issue was legislation by Republicans Sens. Arlen Specter and Rick=20 Santorum, who are trying to help bring the Arlington, Va.-based airline out= =20 of bankruptcy by the end of March. The lawmakers want the federal Pension=20 Benefit Guaranty Corp. to let US Airways pay its pension liabilities =97=20 mostly to the airline's pilots =97 over three decades instead of the=20 seven-year deadline it is now facing. In testimony in front of a Senate=20 Appropriations subcommittee hearing, PBGC executive director Steven A.=20 Kandarian maintained that stringing out the payments would risk the=20 stability of the 35,000 pension plans nationwide that the federal fund=20 protects. Moreover, he said, the plan would give US Airways an unfair=20 advantage at a time when other companies are grappling with high pension= costs. Kandarian also maintained that the PBGC does not have the jurisdiction to=20 revise the law. US Airways, the nation's sixth-largest airline, was the=20 first to file for bankruptcy during the travel industry slump following the= =20 Sept. 11 terrorist attacks. The company is carrying a $61 billion debt,=20 lost $2.1 billion in 2001 and has said it needs to cut costs by $1.6=20 billion to remain viable. An estimated 17,000 of US Airways' 32,000=20 employees work in Pennsylvania. Its hubs are in Philadelphia, Pittsburgh=20 and Charlotte, N.C. The airline is set to appear in bankruptcy court on=20 Thursday to seek approval for the reorganizational plan it outlined last=20 month to emerge from bankruptcy. That proposal largely hinges on a $1=20 billion loan guarantee from the Air Transportation Stabilization Board that= =20 has been tentatively awarded on condition that US Airways settles its=20 massive pension obligations. PBGC will take over US Airways' pension plans if the airline is forced to=20 liquidate. If that happens, pilots face losing up to 75% of the anticipated= =20 retirement benefits, said Capt. Duane E. Woerth, president of the Air Line= =20 Pilots Association. "The time that we have to resolve this is very short,"= =20 said US Airways President and CEO David Siegal. The airline's equity=20 sponsor and other lenders "expect a resolution to this matter within days,= =20 not weeks or months." The Senate last week refused to consider the pension= =20 extension bill, but Specter said he and Santorum may try to force a vote by= =20 a parliamentary procedure. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@escape.ca Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.atlanticlng.com TnT Webdirectory: http://search.co.tt *********************************************************