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TABLE OF CONTENTS
Introduction
FIP Requirements
FIP Schedule
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INTRODUCTION
This document constitutes an update to the Funding Improvement Plan ("FIP") for the
Bert Bell/Pete Rozelle NFL Player Retirement Plan ("Retirement Plan"), which was originally
adopted by the Retirement Plan's Retirement Board on February 23, 2011, in accordance with
federal law. The FIP provides the bargaining parties, the National Football League Management
Council ("NFL Management Council"), and the National Football League Players Association
("NFLPA"), with a contribution arrangement that is expected to enable the Retirement Plan to
increase its funding percentage.
Section 305 of the Employee Retirement Income Security Act of 1974, as amended, and
the parallel section 432 of the Internal Revenue Code, establish "endangered" status (also
referred to as "yellow zone") and "critical" status (also referred to as "red zone") for
multiemployer defined benefit pension plans based on the plan's funded level and whether the
plan is expected to experience a funding deficiency in the current or next six years (for
endangered status) or in the current or next three or four years (for critical status). A plan in the
yellow or red zone is subject to certain requirements intended to improve the plan's funded level.
A plan that is not in the yellow or red zone is in the "green" zone, and none of the yellow or red
zone requirements apply.
On June 28, 2010, the actuary for the Retirement Plan certified that the Retirement Plan
was in endangered (yellow zone) status for the Plan Year beginning April 1, 2010 because the
Retirement Plan was less than 80 percent funded on April 1, 2010. In response to this
certification, the Retirement Board adopted a FIP effective February 23, 2011. The Retirement
Board will update the FIP annually based on the actual experience of the Plan. This update was
adopted May 14, 2015 and supersedes the updated FIP that was adopted on May 15, 2014. It
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includes experience and data for the Plan as of April 1, 2014 and reflects additional contributions
negotiated by the collective bargaining parties.
FIP REQUIREMENTS
A FIP consists of benefit reductions, contribution increases, or both, that are reasonably
expected over a ten-year period to meet two benchmarks: (1) reduce the plan's unfunded
liabilities by at least one third and (2) avoid an accumulated funding deficiency, i.e., a failure to
meet minimum funding requirements for a plan year. A FIP must be based on reasonably
anticipated experience and reasonable actuarial assumptions regarding investment income and
other experience of the plan over a period of future years.
If, before the ten year period ends, the actuary certifies that the plan is no longer in
endangered status (e.g., the plan is at least 80 percent funded and not expected to have a funding
deficiency in the current or next six years) and the plan is not then in critical status, the FIP
requirements end.
Funding Improvement Period
The ten year period or "funding improvement period" begins on the first day of the first
plan year beginning after the earlier of (1) the second anniversary of the date of the adoption of
the FIP, i.e., the first plan year beginning after February 24, 2013 or (2) the expiration of the
collective bargaining agreement ("CBA") (covering at least 75% of active participants) in effect
on the due date for certification of the plan's status, i.e., the first plan year beginning after March
3, 2011. For the Retirement Plan, the funding improvement period therefore begins April 1,
2011 (the first Plan Year beginning after March 3, 2011) and ends March 31, 2021.
Schedule
Generally speaking, once a FIP is adopted, the bargaining parties must agree on a
schedule consisting of increased contributions or future benefit reductions, or both, which would
allow the Retirement Plan to satisfy the funding benchmarks of federal law by the end of the tenyear funding improvement period. If the bargaining parties cannot agree, then the Retirement
Board is required to implement a "status quo" or "default" schedule after the expiration of the
then-current CBA that, among other things, assumes that the Retirement Plan will provide no
new pension benefit accruals.
To meet its FIP obligations, the bargaining parties agreed and the Retirement Board
adopted a schedule of increased contributions, the most current version of which can be found
below, under FIP SCHEDULE.
FIP SCHEDULE
The Funding Improvement Plan Schedule below shows the estimated contributions and
funded percentage of the Retirement Plan during the remaining portion of the funding
improvement period.
Funding Improvement Plan Schedule
(millions)
April 1, 2014 Updated FIP Schedule
Plan Year
Ending
03/31/2012
03/31/2013
03/31/2014
03/31/2015
03/31/2016
03/31/2017
03/31/2018
03/31/2019
03/31/2020
03/31/2021
Actual or Estimated
Contribution
$172.1
$105.0
$299.7
$305.5
$267.8
$244.0
$231.9
$138.4
$109.3
$89.0
Estimated
Funded
Percentage*
52%
48%
56%
61%
67%
72%
77%
79%
80%
80%
The original FIP adopted on February 23, 2011 was developed with the intention of
achieving a funded percent of 80% by the end of the funding improvement period. The
Retirement Plans actuary has estimated that the current estimated contributions will result in the
Retirement Plan reaching that benchmark by March 31, 2020.
The updated FIP is based on the census data, asset information actuarial assumptions, and
plan provisions which were used for the actuarial valuation as of April 1, 2014. Employer
contributions were projected using the actuarial assumptions and methods stated in the applicable
collective bargaining agreement.
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The Retirement Board will review the FIP and schedules annually and make changes, as
appropriate, to satisfy the FIP requirements.
A contributing employers failure timely to contribute to the Retirement Plan at the rates
required by the schedule that the bargaining parties have adopted or that has been imposed by the
Retirement Board will result in the deficient amounts being treated as delinquent employer
contributions under the Retirement Plan.
Employers are subject to an excise tax if they fail to make contributions required under
the FIP. The amount of the excise tax is the amount of the unpaid contribution.
The Department of Labor has the authority to assess a penalty of up to $1,100 per day
against the Retirement Board if it does not timely adopt a funding improvement plan or if the
Retirement Plan does not meet the funding improvement benchmarks (reduce the Retirement
Plan's unfunded liabilities by one third (or fund the plan to 80%) and avoid an accumulated
funding deficiency) by the end of the funding improvement period.
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