IPALCO may face challenge over old retirement plan

[Omaha Steve]

http://nl.newsbank.com/nl-search/we/Archives?p_action=doc&p_docid=11BBAE1A61D71218&p_docnum=1

IPALCO may face challenge over old retirement plan
Utility accused of continuing to collect plan money from ratepayers despite spinning it off years earlier

Chris O'Malley [e-mail]

Six years after its $2.2 billion sale to AES Corp.-a deal that generated at least three shareholder lawsuits-IPALCO Enterprises has signaled that more sparks might fly from the long-done deal.An attorney claiming to represent participants in a retirement insurance plan IPALCO spun off and stopped funding six years ago alleges the utility continues to recover from its 468,000 ratepayers millions of dollars a year toward the plan.

The letter asserts that Indianapolis Power & Light "is recovering in rates on average approximately $19 million per year allegedly intended for the funding of the IPALCO Voluntary Employee Beneficiary Association Trust," IPALCO states in an Aug. 9 filing with the U.S. Securities and Exchange Commission.

In the filing, IPL does not identify the attorney or the number of retirees purportedly represented. The letter IPL received in June demands that it "backfund" the trust at $19 million per year "and fund at the same level going forward."

The VEBA trust is the principal health and life insurance benefit plan for the utility's retirees and their families. It has 1,615 participants, according to the trust's most recent annual report.

In 2005, the trust's managers warned that benefit reductions would be necessary "to extend the long-term viability" of the plan, which was strained by a wave of 550 early retirements when Virginiabased AES bought IPALCO.

The local utility now employs 1,500 people.

FULL story at link.