Break for Airlines Still in Pension Bill

A provision offering special relief for the airline industry "absolutely" remains part of a pension reform bill being crafted by House-Senate negotiators, Sen. Johnny Isakson, R-Ga., said Friday.

Isakson, chief sponsor of the airline amendment, said overall legislation to tighten rules on pensions has "about a 60-40 chance" of winning final passage within weeks. If it passes, financially strapped carriers will get more time to replenish their underfunded pension plans.

The House and Senate have passed separate bills on corporate contributions to retirement funds, but weeks of negotiations have yet to produce a compromise.

The legislation is "complicated and comprehensive," Isakson said, and "there is a lot at stake," so competing factions are fighting hard for their interests.

But Isakson said that when it comes to specific industry relief, "those arguments have been made, and the airline provisions are in it."

The urgency of airline aid was underscored Friday when Atlanta-based Delta Air Lines Inc., the largest U.S. carrier operating in bankruptcy, revealed plans to file documents Monday in U.S. Bankruptcy Court in New York to terminate its pilots pension plan on Sept. 2.

If the court approves the long-expected request, Delta will join UAL Corp.'s United Airlines and US Airways Group Inc. in terminating pension plans while under bankruptcy court protection.

In an interview last week, Delta financial chief Ed Bastain said that unless Congress enacts the pension overhaul by late summer, Delta also might have to terminate its pension plan covering 91,000 active and retired flight attendants and ground workers.

Delta spokesman Anthony Black said Friday that "our commitment to saving those plans remains strong," but the company needs help.

"We strongly support the work of Congress," he said. "Time is of the essence."

Isakson said congressional negotiators hope to complete their work by July 4, allowing Congress to vote on final passage before the August recess.

Senate Majority Leader Bill Frist, R-Tenn., is "fully engaged now" in the talks, and key lawmakers are "meeting on a daily basis," he said.

Earlier in the week, House Majority Leader John Boehner, R-Ohio, said he had "given up on setting dates," but has been pushing for completion of negotiations before Congress takes a break the first week of July.

House and Senate negotiators began meeting in March after each chamber had put its own twist on the legislation. Now they must come up with a unified version that shores up the federal Pension Benefit Guaranty Corp., which uses corporate premiums to insure pension plans.

About 44 million Americans have traditional pensions, which pay a set amount each month, based on salary and length of employment. But many companies have failed fully to fund their pension promises. In all, such plans are underfunded by about $450 billion.

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