Opposition to the Senate's compromise measure appeared to be based, in large part, on concerns that it might allow some companies to neglect their pension funds, putting benefits in peril. One staff member also complained that senators were expected to give their consent right away, even though they were not shown the legislative language until late Tuesday morning. With tens of billions of dollars hanging in the balance, that was asking too much, he said. There were also suggestions that opposition was coming from senators of states where low-cost airlines are based.
The large, established airlines are among the companies expected to benefit most from any pension break. Competing airlines that do not offer pensions see pension relief as an indirect subsidy to their larger and older competitors, according to Senate aides who have received calls from airline lobbyists.
United Airlines, a unit of the UAL Corporation, in particular would have benefited from the pension measure. It has disclosed in filings with the Securities and Exchange Commission that without legislative relief of some sort, it will have to put $4.8 billion into its four pension funds over the next five years, with most of the payments due by 2006 because of a pension rule requiring companies to speed up their contributions to plans with large, lasting deficits. United has been operating under bankruptcy protection for almost a year, and its executives have said that the large, required pension payments are its single largest stumbling block as it works to emerge from bankruptcy
The large, established airlines are among the companies expected to benefit most from any pension break. Competing airlines that do not offer pensions see pension relief as an indirect subsidy to their larger and older competitors, according to Senate aides who have received calls from airline lobbyists.
United Airlines, a unit of the UAL Corporation, in particular would have benefited from the pension measure. It has disclosed in filings with the Securities and Exchange Commission that without legislative relief of some sort, it will have to put $4.8 billion into its four pension funds over the next five years, with most of the payments due by 2006 because of a pension rule requiring companies to speed up their contributions to plans with large, lasting deficits. United has been operating under bankruptcy protection for almost a year, and its executives have said that the large, required pension payments are its single largest stumbling block as it works to emerge from bankruptcy
