The pension plan for the American Federation of Musicians and Employers is set to receive a $1.5 billion cash influx to save the plan from becoming insolvent.
The money comes as part of the American Rescue Plan, backed by Senate Majority Leader Chuck Schumer (D-NY), which was passed in 2021. The pension plan for the musicians’ union, which represents close to 50,000 members in New York who work on Broadway, in bands, in orchestras and in film and theater, is now set to receive the funding.
Without the funding, the plan was set to run out of money in 2034. At that time, the plan would have been required to reduce participants’ benefits by roughly 50 percent below the amount payable. The new funding will enable the plan to continue to pay retirement benefits without reduction for “many years into the future,” according to the release.
“When I became majority leader, I promised I would not stop fighting until our union brothers and sisters and their families got the pension relief they needed and earned, and today it is music to my ears to hear they will finally get the relief they have long needed,” Schumer said in a statement.
The underfunded pension plan has been a long-running issue for the musicians’ union. In 2018, Adam Krauthamer was elected president of Local 802 AFM, the New York local, after running on a platform of pension concerns. He held the office for a three-year term, with a goal of bringing in new members to help fund the pension, before Tino Gagliardi, who had previously held the post, was re-elected. Sara Cutler succeeded Gagliardi when he resigned to be president of AFM.
A group of musicians had previously sued the plan’s trustees over mismanagement concerns. The plan took a further hit during the pandemic, as theaters and other venues were closed for 18 months.
“Musicians work hard for a living, but too many were going to struggle because of the collapsed pension system. Now, thanks to this $1.5 billion from the American Rescue Plan, musicians can retire and get what was rightfully owed to them. Working people of all professions have a friend and ally in Senator Schumer and we are so thankful that he could deliver this massive victory for the musicians,” Cutler said.