Congress fell short once again of achieving one of its prime goals: coming up with a bill to assure 44 million workers who depend on employer-based pension plans that they will get their promised retirement benefits.
House and Senate negotiators originally set Tax Day, April 15, as their target for finding a compromise. When it eluded them, the new deadline became Memorial Day, and then Independence Day.
But they left Friday on a weeklong Fourth of July recess still apart on two big issues:
-How to make companies that have fallen behind on payments to their pension plans make them up without driving them to terminate the plans or declare bankruptcy.
-Whether to single out financially struggling airlines for special treatment. The Senate wants to give them up to 20 years to get back to full funding of their pension plans; House negotiators don't.
Maybe after the recess
"There's not much left to be resolved," Senate Finance Committee Chairman Charles Grassley, R-Iowa, said Thursday after a House-Senate meeting. "The staff is going to work real hard over the Fourth of July break."
The two chambers passed their respective bills in late 2005, and talks on a compromise have dragged on since March.
At the prodding of House Speaker Dennis Hastert, R-Ill., and Senate Majority Leader Bill Frist, R-Tenn., negotiators have been meeting almost daily in recent weeks. But progress has been incremental.
"Days and days and days of the same ditto," House Majority Leader John Boehner, R-Ohio, a chief sponsor of the House bill, said as he emerged from one recent meeting.
Lynn Dudley, vice president of the American Benefits Council, which represents companies with pension plans, said her organization is not overly concerned by the missed deadlines.
"The truth of the matter is they've got to get this thing right. It's the bedrock of retirement security for millions of people," she said.
The toughest issue has been working out a definition of what is an "at risk" company that would be required by the bill to increase contributions to its pension plan.
Currently, company pension plans are underfunded by an estimated total of $450 billion. The Pension Benefit Guaranty Corp. - the federal agency that insures private pension plans much like the Federal Deposit Insurance Corp. insures bank accounts - estimates that $100 billion of that is with companies with serious funding problems.
The PBGC, which is self-funded from premiums, is itself burdened by a $22.8 billion deficit because it has had to take over the benefits obligations of companies that go bankrupt and terminate their plans.
Without a fix, many fear the whole defined benefit pension system could implode in a repeat of the late 1980s savings and loan crisis that ended up requiring a $130 billion taxpayer bailout.
The original Senate bill would have linked at risk status to a company's credit rating, an idea strongly opposed by General Motors and others in the auto industry with poor credit status.
Negotiators have since backed off this approach, but industry sources have expressed concern that other proposals also are overly harsh - such as defining plans that are less than 80 percent funded as at risk for default.
One sticking point is whether credit balances, extra contributions paid into a plan to cover future years, should be counted as an asset when determining a plan's financial viability.
Former Michigan Gov. John Engler, who is now president of the National Association of Manufacturers, said excessively tough rules could be counterproductive. "The cost goes up if somebody terminates a plan and then turns it back over to the pension board," he said.
With more companies phasing out defined benefit plans and switching to defined contribution programs such as 401(K) plans, the pension legislation also tries to establish rules for conflict-free investment advice and solidify multiemployer plans mutually sponsored by companies and labor unions.
It also seeks to give legal backing to cash balance plans, a variation of defined benefit plans that have been in legal limbo because of a judge's ruling that IBM Corp.'s plan discriminated against older workers.