Retiree Advocates: Membership Application IOWA & … · [email protected] Secretary Rose Bailey, Sioux Falls, SD 605-336-7771 [email protected] ... noted that as a retiree group, we

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NWB/U S West Retiree Association, Inc.205 Heritage Circle NorthBurnsville, MN 55337-2667

Address Service Requested

Retiree Advocates:IOWA &

SOUTH DAKOTAVikki Farrand605-332-3670

[email protected]

MINNESOTABarb Hermanson*

[email protected]

NEBRASKAAda Bork

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NORTH DAKOTAArnie Pauls

[email protected]

*Associate Ombudsman

Visit this website:Association of

U S West Retireeswww.uswestretiree.org

or www.qwestretiree.org

NWB/U S West RetireeAssociation, Inc. Directors:

Chairman Larry Smith, Fargo, ND701-235-1300

[email protected] Chairman Jim Burns, Omaha, NE

[email protected]

Secretary Rose Bailey, Sioux Falls, SD605-336-7771

[email protected] Albrecht, Roseville, MN

[email protected]

Marlyn Beaudine, St Cloud, MN320-253-6232

[email protected] Bork, Omaha, NE

[email protected]

Tom Burns, Papillion, NE402-597-6205

[email protected] Johnson, Blaine, MN

[email protected]

RogerWilliams, Waterloo, IA319-236-0595

[email protected] Retiree Guardianis the newsletter of the

Association of U S West Retirees in Iowa,Minnesota, Nebraska, North Dakota and South

Dakota. We publish on a quarterly basis.

❑ NEW ❑ RENEWAL ❑ EXTRA ❑ CHANGE OF ADDRESS Date

Name

Street Address

City, State, Zip

Tel. No. ( )

E-mail Address

Company Retired From State

I am willing to help by doing the following: (Circle one or more)

1) Calling Committee 2) Membership Committee 3) Legislative Committee

Please return this form and your check to the above address.NWB/U S West Retiree Association, Inc. is a nonprofit tax-exempt organization under Section 501(a) of the Internal

Revenue Code, however, dues are not deductible on your personal tax returns. Records are kept at 45 Jewel LaneNorth, Plymouth, MN 55447-3566. A portion of your dues goes to support the National Retiree Legislative Network

(NRLN) in Washington, D.C.

Membership ApplicationNWB/U S WEST RETIREE ASSOCIATION, INC.

45 Jewel Lane NorthPlymouth, MN 55447-3566

(Please Print)Amount Dues ($20/Yr/Person)

Amount Membership Development

Amount Other (Specify)

Total Amount Paid

NEWSLETTER OF THE ASSOCIATION OF U S WEST RETIREESNow bringing you news from Association members in all 14 U S West states.

GUARDIANRETIREETHE

SUMMER 2005

WE WERE THE OPERATORS AND REPAIR CLERKS, THE INSTALLERS AND LINEMEN, THE ENGINEERS AND NETWORK PLANNERS, THE CRAFT AND MANAGEMENTEMPLOYEES OF EVERY DESCRIPTION WHO BROUGHT TELECOMMUNICATIONS TO THE HOMES, BUSINESSES, AND INSTITUTIONS OF 14 STATES. NOW WE ARE UNITEDIN OUR COMMITMENT TO PRESERVE AND ENHANCE THE RETIREMENT BENEFITS PROMISED TO US AND TO THOSE WHO FOLLOW US AS TODAY’S ACTIVE EMPLOYEES.

2Chairman’s

Message

4A View FromWashington

6Legal Activities

7Health Carefor Post ’90

Retirees

9Retiree

Advocacy

10NWB/U S WestAnnual Meeting

12In The Media

I N S I D E

Cynthia,In your May 9 e-mail which you

broadcast to all AUSWR Boardmembers and directly to the Plain-tiffs, you stated rather sarcastically,“What I still fail to understand iswhy you would bring such a suit (the“Pension Death Benefits” case) now.Qwest has not eliminated the deathbenefit and as far as I am aware, hasmade no statement to the retireesabout doing so for one and one-halfyears.” We are very surprised thatyou would say you fail to understand, consideringthe detailed explanation set forth right in the text ofthe Amended Complaint and after you heard our in-depth reasoning during our prolonged telephoneconversation on Friday, May 6.

The retirees of MT. Bell/PNB/ NWB/U S Westand Qwest have been in limbo regarding the currentadministration’s threat to cancel the death benefit inthe Pension Plan for almost two years. As you willrecall, the decision to “eliminate” this benefit forretirees who have a “qualified beneficiary” has onlybeen postponed, not withdrawn, by the Company.

The Association of U S West Retireeshas now appealed to three differentExecutive Vice Presidents of HumanResources at Qwest in the lasteighteen months to sit down anddiscuss this matter and bring it to anamicable resolution, so that retireescan act with certainty in their estateplanning and can do their best toprovide for their loved ones aftertheir death.

We understand, as you iterated inour telephone conversation, that

everyone currently employed at Qwest is workingvery hard to ensure that Qwest remains a viableeconomic entity. What you need to also understand isthat the many thousands of retirees worked very hardduring their careers to build a strong company whichhas hit upon hard times through no fault of theretirees. These retirees have seen a $5.2 billionsurplus in the Plan evaporate during the reign of Mr.Nacchio while under the stewardship of a Board ofDirectors that essentially remains intact. During theirworking years, these employees, both management

A MESSAGE FROM THE PRESIDENT

PRESIDENT’S LETTER

Mimi M. Hull

(continued on page 2)

Dear Fellow Retirees, We must be constantly vigilant to assure the continuation of rights and benefits weearned as employees. I’d like to share with you a letter I wrote on all our behalf to Cynthia P. Delaney of the

Qwest Legal Department regarding Qwest’s potential removal of the death benefit from our pension plan.

The Retiree Guardian / Summer 20052

the promises made to us in retirement.Both Curtis Kennedy and Jim Norbynoted that as a retiree group, we areunique among corporate entities inAmerica, unusual in our solidarity andfocus on important issues.

The more members we have, thestronger we become. So I encourageyou to renew your membership, con-tinue your active participation in theAssociation, and work to recruit a fewof your retiree friends who haven’t yetmade the commitment to join us. Givethem a call. Buy them a lunch. Showthem the Retiree Guardian. Tell them

what we’re doing and why. We’ll all be better for

Greetings friends,I’d like to thank the 207 of our

Association members who made thetrek to Fargo for the May 19th AnnualMeeting. It was a tremendous success,and continues to remind me of thepower we have as a group to influencecompany policies toward retirees. Ourspeaker Curtis Kennedy brought thatmessage home very effectively. Youcan read more about his talk on page10 and 11.

Every meeting of NWB/U S Westretirees I’ve attended is energizing. It’sgreat to see old friends, talk about oldtimes, and renew the enthusiasm we have forstating strongly to Qwest our intent to hold them to

and bargained-for, deferred income in the form ofpromised future benefits in retirement, includingthe provision of one year’s final pay to be paid to aqualified beneficiary, upon the death of the retiree.

It was never communicated to any of theretirees who draw an annuitant pension from theQwest Pension Plan that this benefit could bewithdrawn at the whim of a current, but fleeting VPof HR. As a matter of fact, all retirees who had theopportunity, and elected, or continue to elect alump sum payment from the pension plan, havebeen and continue to be paid an actuarialequivalent of the death benefit. It is simplydiscriminatory, then to single out and threaten agroup who elected a yearly pension, or did not havea choice, with the cancellation of this deferredcompensation.

This action is being instituted now, so thatretirees can proceed with planning knowing thatthis death benefit is a vested benefit under ERISA,and if our cause does not prevail, they can exploreother options, including what services that thismoney was supposed to provide for their lovedones, can be accessed through governmental pro-grams, including the Medicare/Medicaid pro-visioning of nursing home care and other end oflife services that survivors might need to access.

I hope that this will help you to understand theurgency of getting this issue resolved, since mostof our retirees, at their ages, cannot simply go out

and purchase life insurance to replace this poten-tially lost benefit.

Also, please understand that AUSWR and itsgeneral membership insist that Attorney CurtisKennedy go forward with the Kerber v. Qwest caseconcerning the “Pension Death Benefits.” Of coursethe best course of action for the company would beto immediately do the right thing and acknowledgethat the Pension Death Benefit was, indeed, billed asa protected fully funded and accrued pensionbenefit, not something that can be taken away at thewhim of present or subsequent top leadership. Thiswas the action taken by U S West top leadershipwith regard to the health care benefits for over30,000 pre-1991 retirees and their beneficiaries.There is no good reason Qwest cannot continue toset the standard for proper treatment of retireeswithin the former Bell System. Considering the pastthreats about ending the Pension Death Benefit,once and for all, CEO Dick Notebaert, EVP BarryAllen, and others should memorialize a writtenguarantee to assure retirees that the Pension DeathBenefit can always be counted on and it will neverbe taken away by either this company administra-tion or any successor company leadership.

I sincerely hope that this will answer your “whynow” question for once and for all.

Mimi M. HullPresident, Association of U S West Retirees

A MESSAGE FROM THE PRESIDENT (continued from page 1)

CHAIRMAN’S MESSAGE

Larry Smith


Summer 2005 / The Retiree Guardian 19

It’s the month when memberships in the Association expire.Is my membership going to expire?

Check it out. Look at the line above your name on the address label.If it reads ‘Renewal Date - Jul 2005’ your membership will expire this July.

Renewing your membership NOW means benefits are uninterrupted. You’ll continue to receive “TheRetiree Guardian” newsletter; “breaking news” e-mail messages if you have access to the Internet, and

you’ll be listed in and receive the new Membership Directory that’ll be distributed this fall.

What do I need to do?Fill out the Membership Application form on the back page, send your dues check,

payable to the NWB-U S West Retiree Association, and mail both to Jack Olson, Treasurer,45 Jewel Lane North, Plymouth, MN 55447-3566

1 year Membership - $20.00 per person/per year - New Renewal Date July 20062 year Membership - $40.00 per person/per year - New Renewal Date July 2007

Why should I renew my membership?I’m glad you asked!

Seven Benefits of Membership in NWB-U S West- Qwest Retiree Association

DO YOU KNOW WHAT’S SO SPECIAL ABOUT JULY?

SolidarityOur NWB-U S West-Qwest Retiree Association, through effective networking, and joining with the some 18,000current members of the 14-state AUSWR (Association of U S WEST Retirees) are achieving positive, constructivedialogue with Qwest leadership - and, when necessary, protesting and fighting for our rights. You can help buildour strength in numbers and bring even more credibility with politicians, regulators, community leaders and newsmedia.

Quarterly InformationAs a member, you’ll receive The Retiree Guardian, an informative, highly respected quarterly newsletter with 16-to-20 pages of news, thoughtful commentary, and member feedback on critical retiree issues.

E-mail Network & Web SiteIf you have access to the Internet, almost daily you’ll receive critically important information on retiree benefitsand other issues from Qwest, the Association, news media and other sources. The AUSWR website(www.uswestretiree.org) is a comprehensive source of information about the Association, its legislative and legalefforts, copies of news articles from major publications, newsletters and a frequently asked question sectioncovering many benefit issues.

Retiree Directory ListingA new Member Directory will be printed in the Fall of 2005. Join before we go to press and you’ll be listed in andreceive a copy of the Directory. It’ll list member names, addresses, e-mail addresses and phone numbers. You’llbe able to get back in touch with friends and co-workers you’ve lost track of, and they’ll be able to contact you.Members joining after the Directory is printed will be printed on addendum pages in “The Retiree Guardian”which can be inserted into the directory.

Retiree Advocate ProgramThis innovative, highly effective program enlists retiree experts who help you navigate through problems withbenefits and other issues. The service continues for your loved ones, in the event of your death or incapacitation.

Legal Options, NegotiationsFrom its very beginning some six years ago, our Association has pledged to support and work toward a healthy,financially sound company; this is to our benefit. We are proud of Qwest’s “Spirit of Service” that we exemplifiedthroughout our careers. We’ve achieved much through open, objective dialogue with Qwest’s top management,but when we feel we’re not being properly heard, the AUSWR’s highly effective legal team goes to bat for us.Great progress has been made in regard to concession service, health care, pension death benefit and other crucialareas. Again, we sincerely want the Company to succeed, but not at our expense.

National StrengthPart of your Association dues goes to support the National Retiree Legislative Network (NRLN) based inWashington, D.C. Headed by Jim Norby, former Chairman of the NWB/U S West Retiree Association and formerAUSWR President, this dynamic group is increasingly reported on in national news media and is our powerfulvoice in Congress and elsewhere. The NRLN’s sole purpose is to represent senior issues. It does not have interestsin insurance, travel or senior related businesses.

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milestonesThe following information is also available on-line at the Qwest Pioneers web page:

www.qwestpioneers.org/about/deathsandretirements.asp

Smith, Ann Marie T. Smith, Ronnie D. Speranza, David A. Spink, Timothy W. Springer, Kenneth L. Steele, Leo M. Stoffan, Terrill L. Stringer, Marilyn Blue Strode, Raymond L. Swayzee, Kenneth W. Tucker, Rosalie A. Voakes, Robert J. Walters, Rosemarie B. Wolf, Randee R. Wright, Cecelia K. Wyatt, Patti A. Yang, Charlene Linda Zepeda, Edward

ColoradoAlegria, Carol Alex, Robert J. Bell, Anna M. Boyce, John L. Bristow, Gary Lynn Burt, Dennis W. Carmer, Richard G. Casper, Vickie L. Claussen, Gary D. Colberg, Janet I. Elder III, Guy E CEspinoza, Elvira R. Fletcher, Eileen M. Fox, Robert L. Funk, Michael B. Gallegos, Ralph Garrett, John H. Gayman, Diane M. George, Elaine M. Gettman, Deborah L. Giron, Peggy D. Greeno, Sandra L. Groomer , Linda S. Hane, Christine M. Hess, Sandie M. Kaufman, John D. Lacy, Suzanne E. Ling, Susan Rose Marquez, Janice S. Martin, Richard M. Martinez, Wilford J. McConnell, James McElroy, Mark R. McMahan, Michael R. McNa, Susan K. Nelson, Frederick A. Nelson, Richard S. Norris, Jeff M.Novoseletsky, Emil M CPavilanis, Ed Phillips III, Sherman W. Piatek, Zbigniew S. Pierce, Elizabeth K. Plumb, Sidney R. Richardson, Dorothy Sue Riley, Kristen K. Roberts, Judith A. Royer, Kit L. Ryan, James E. Sango, Candus S. Scotty, Richard.

Sena, Mary Ann Shober, Charles F. Sims, Diane A. Starley, Larry R. Suiter, Lonnie P. Tolar, Mark S. Trujillo, Leroy Turner, Dorothy R. Van Zandt, Bruce Robert Vogel, Danny R. Walter, Sheryl Weatherford-Smith, Marilyn Willie, J S Winings, Daniel K. Yule, Roberta J.

IowaBaker, Mary E. Boehm, Luann K. Christian, Karen K. Clark Jr, Lyle W. Dickens, Mary F. Dingman, Michael R. Fox, Violet R. Freestone, Mary Jo French, Kathleen R. Giaffoglione, Cheryl C. Hoffman, William P. Howard, Ruth H. Howell, Alexis J. Johnson, Diane M. Lawless, Sharon K. Lee, Deann J. Martin, Marylou Mitton, Peggy D. Nardini, Deborah L. Olson, Larry A. Passmore, Linda Lea Plank, Madonna A. Rice, Patricia E. Sabin, Karen L. Schaefer, Catherine K. Sipes, Paul A. Suchet, Charles A. Theiler, John J. Wilson, Victor M.

IdahoBoldman, Peggy L. Folwell, Kenneth D. Geiger, Patricia J. Grose, Michele I.Hatfield, Kathryn A. Martindale, Charles L. Medders, Gary C. Miller, Pamela K. Ulmen, Philip H. Wyrick, Sharon F.

MississippiKloostra, Evelyn J.

MinnesotaAnderson, Margaret K. Baran, Elizabeth M. Bradshaw, Jeanne M. Burwell, Gail D. Clark, Carole J. Dahlstedt, Cynthia J. Ford, Frank L. Goedtel, William L. Guimond, Robert D. Hage, Judith K. Hanson, R Carmel

Holmes, Sally W. Hoskins, Judy Anne Ingemann Jr, Thomas J. Le Dell, Cynthia L. Meyer,Joseph P. Michalec, Joanne Miller, Denise M.Miller, Gary C. Ogren, Kimberly K. Otto, Timothy E. Running, Michael A. Scanlon, Michael T. Shepard, Sharon N. Swoboda, Kristine D. Thaxton, Thomas K. Trebesch, Donna M. Troje Jr, Frank J. Williams, Catherine Wilson,P atrick B. Young, Christopher L. Zulkosky, Kathleen A.

MontanaHarlan, Kim C. James, William R. Kasper, Kenneth C. Morgan Jr, John R. Mundt, Blaine G. Muster, Marcia J. Schreiner, Gary W. Stockstad, Sharon A. Trenary, Mark E. Williams, Sherry L.

North DakotaBrothers, Kerry A. Gwin, Richard A N

NebraskaAdkins, Jolene S. Ashley, Gregory C. Bagg, Deborah K. Christians, Judith A. Cochran, Shirley A. Dobbins, Willis E. Galvin, Cheryll K. Kempnich, Gerald L. Kyte, Jaymi S. Mace, Linda K. Manley, RuthAnn B. McGill, Marcia J. Novak, James R. Peterson, Robert R. Peterson, Scott A. Purchase, Kathryn A. Rippey Jr, James C. Rouse, Bonita Louise Rusk, Joseph D.

Talmon, Lonnie F. Veylupek, Joseph C. Weis, Judith K.

New MexicoBaca, M Alberta Crone, T David Donigan, Patrick J. Garcia, Gerald A. King, Stephen Lawton, Carol A. Lopez, Joyce Lujan, James R. Martinez, Alfredo V. Myers, Marie R. Otero, Bruno R. Reyes, Ruben Rusher, Bonnie J. Salas, Leroy Stone, William A. Taylor, Vera F.

OregonBlake, Jane M. Branstetter, Leslie D. Burnacci, Margaret L. Graves, Loren E. Graville, Robert L. Gregg, Lainnie M. Herman, Dianne L. Hill, Mitchell W. Hoots, James M. Jensen, James C. Laber, Roberta F. Lane, Jory P. Lewis II, Edward A. Minkler, Victor S. Morris, Charles E. Mrowka, Kathleen Lee Piazza, Ingrid Pirnie, Jerry D. Rhodes, Judy A. Rosebrook, Gail E. Rosecrans, David F. Schoorl, Sherry M. Tegge, Lorena F. Williams, Faune G. Youmans, Michael S.

South DakotaBedford, Harlan D. Bravo, Regina M. Dusenberry, Barbara A. Lee, Brian Souter, Teresa A. Stone, Valerie S.

TexasHall, Gary R.

UtahBergen, Patricia J. Blackburn, Lorena J. Bradley, Kathleen B. Cherry, George H. Child, Gay D. Cordova, Laura M. Cranfill, Carol S. Daniels, Jeralyn Dosen, Lorraine M. Elison, Margo D. Hansen, Vickey E. Marshall, Larry S. Martinez, Deborah A.

Martinez, Joseph D. Mascarenaz, Jolene Mercer, Anne L. Montoya, Margine A. Pearce, Marlies S. Pendley, Robert K. Reed, David W. Rogers, Betty P. Tsoufakis, Linda S. Viertel, Linda S. Warner, Randy D.

WashingtonAlexander, Sandra M. Allen, George A. Barber, William C. Baty, Robert E. Bendix, Pamela M. Benedict, Derek S. Clark, Don S. Culbert, Barbara A. Davies, Allen L. Egan, Johanna S. Espinoza, Jennie C. Filkowski, Leslie G. Gentzler, Carole A. Hartman, Teresa M. Heck, Robin L. Johnson, John E. Johnson, Thomas J. Johnson, William D. Jones, Marie C. Kaiser, Karen S. Kalapaca, Dorothea J. Klinkhammer, Michael R. Knebel, Edward M. Lawson, Fred C. Mangiaracina, Mark H. Marvin, Dennis R. Ness, Claire D. O’Brien, Allan E. Pair, James R. Powell, Nancy W. Reierson, William E. Riley, Dennis M. Scharer, Thomas A. Schramm, Jan E. Sweetman Jr, John J. Thurston, Michael A. Treptow, Fred L.

WisconsinArnold, Margaret A.

WyomingBelanger, Kenneth P. Dow, Robert W. Elwood, Margaret J. Hall, Dennis L. Johnson, Kevin E. Lucero, Albert E. Rosendahl, J Douglas Swenson, Max L. Werbelow, John M.

(continued from page 17)


FROM THE EDITOR...If any of you have never attended an Association annual meeting, I can say after going

to my first one in Fargo, you should definitely put next year’s meeting on your schedule.For me it was good to put faces with e-mail names and voices on the phone from

monthly board conference calls. It was easy to see that even if there were no outstandingprogram and speakers, this meeting was a success in the opportunity it provided for oldfriends to gather. I’m already looking forward to the next one.

As always, if you have any comments or questions, pass them on to your retireeadvocates or to me. And keep involved in the Association. -- Jerry Miller

To Phyllis Kielblock,I continue to be impressed with how responsive Retiree Volunteers are when asked for

help. You, obviously, are on the top of the list. This is the first time (at least that Iremember) that I asked for help from Mary Ann (Neuman), and she respondedimmediately.

Lynn Lindquist mentioned that he had lost contact with most of the people he hadworked with, and seemed anxious to regain contact. As a sidelight, Jan Stoney, via e-mail,asked me if I had Lynn’s e-mail address. I didn’t but through the magic of the internetfound him in Minnesota, and made the contact.

There are probably many other former NWB’ers out there somewhere who would liketo belong to the Association if they only knew we existed. -- Leo Graff, Omaha, NE

To the Editor,Loranda (Wanda Farrell, St Paul, MN, joined the Retiree Association in October 1999.

She passed away in July 2004. The note below came from her husband, W.H. Farrell, whorenewed membership in his own name. He thanks us when Qwest should get the credit –but we appreciate his kind words anyway. -- Phyllis Kielblock, Executive Secretary

“My wife Wanda (Loranda) was always highly interested in the Retiree Association.Thanks to her, I am today receiving half of what her pension was and should support theorganization that made that happen.”

Thanks. --Will Howard Farrell, St. Paul, MN

MEMBER COMMENTS...

CHAIRMAN’S MESSAGE (continued from page 2)

your efforts.I’d like to welcome Roger Williams to the

Board of Directors. Congratulations, Roger! We’relooking forward to working with you.

Eldon Ranney, long-time board member andsupporter of our organization, is stepping downfrom the board. Thanks for your service, Eldon. Wewelcome your continued membership and contri-

butions to the Association.I’d also like to congratulate Jim Shaw, who

received the Association “Above and Beyond”Award at our Fargo Annual Meeting. The award isrichly deserved.

Have a great summer!

Larry Smith, Chairman


(Special to The Guardian –Summer Issue) -- April 7, 2005

As I’m sure you all know bynow, the NRLN’s mission is to dowhatever we can at the Congres-sional level to promote legislationthat protects retirees from theencroachment of our incomeswhile in retirement. We have inter-preted this to include pensions thatwe earned and health care benefitswe were promised. Even thoughour charter, in the strictest inter-pretation, does not include Social Security andMedicare issues, we have decided to at least study,debate, and arrive at a position on the SocialSecurity issue. This process has just begun. In thenext issue of the NRLN newsletter, The Focus, willbe an article that discusses the history of SocialSecurity. We, at this point, take no position on themany proposals made on Social Security. We have,however, formed a committee of outstanding, well-read retirees who, in a bipartisan way, will studyand monitor the debate. Later, the NRLN and itsBoard of Directors will carefully consider alternatepositions. This is going to be a contentious, perhapsdivisive issue, but we must step up to the plate andtake a stance.

I would like to discuss in this issue of “TheView” a legislative initiative that the NRLN hasundertaken. The reason that so many of us find thatwe’re in a financial bind is that while we weretucked away in retirement tending to our grand-children, our family and gardens, our formeremployers were off to Washington to see how theycould change to their advantage the rules set downin a law that was to protect our pensions. TheEmployee Retiree Income Security Act was passedinto law in 1974. It took eleven years to wind itsway through Congress. Its fundamental intent wasto protect retirees’ pensions. Since that time, therehave been scores of amendments, maybe hundreds,to the original bill. None of these amendments, thatwe know of, enhanced the protection of retirees.All, in one form or another, took something awaythat in the final analysis favored ourformer employers. What we have left,I’m prone to say, resembles a piece ofswiss cheese. It’s full of holes!Therefore, we think it’s time, maybe

past the time, to render a series ofamendments to the act that willrestore some of the damage andplug some of the holes.

As I write this (mid April) theNRLN staff in Washington is busywriting a platform on which tobase a Bill to be introduced intoCongress. This will require a greatdeal of time and effort – withoutguarantees – to get members ofCongress to act on these changesdespite opposition from the steadystream of lawyers and lobbyists

acting on behalf of corporations. Nevertheless, it isimperative that we make the effort.

Let’s examine a few of the leading elements ofour proposal.

Court decisions and congressional actionenabling money and Plan assets to be allocatedthrough transfer out of the pension plans for otheruses have eroded the strength of pension planassets. Clearly, the intent of Congress in enactingERISA was in large part to assure that Plans andtheir assets were to be used solely for the benefit ofPlan beneficiaries. Unfortunately, many exceptionshave been carved away from the assets in one wayor another. (e.g. Congressional action and courtdecisions.) Additionally, and unfortunately, it ispermissible to allow a pension fund to pay for“early outs” and their monetary enticements. Also,pension funds have been tapped for voluntary lay-off bonuses, sometimes amounting to as much as ayear’s salary or wages. This cost is normally paidfor from corporate operating expenses. And, finally,such added payments are not accounted for in thecalculation of the liabilities and, thus, are under-stated. Surplus pension funds also may be used toestablish health care Trusts 401(h). This has theeffect of lowering the pension fund base whichmakes it more vulnerable to under funding and lessable to weather a financial market turn down. Thecompany reaps the benefits of dual advantages ofoffering retiree health care while not having tocontribute current revenues to pay for it.

The plot thickens. Under current law the com-pany is not required to report detailedinformation on how it calculates itsfunding status. No one, then, includ-ing the Federal Government, can

A VIEW FROM WASHINGTONNRLN PRESIDENT’S REPORT

A.J. (Jim) Norby



milestonesThe following information is also available on-line at the Qwest Pioneers web page:

www.qwestpioneers.org/about/deathsandretirements.asp

Recently DeceasedRetirees –1st Quarter 2005ArkansasAlbert, John A.Hassel, Lester L.

ArizonaBurig, Beatrice M.Carruthers, Phyllis M.Colee, Ruby F.Contreraz, Timothy R.Corbett, Ann M.Davis, C GDuffy, Edward L.Ertz, Betty H.Franklin, Jerald R.Greer, Blanche Heller, Geraldine D.Holifield, Rosie M.Jarvis, Harold L.John, Gerald A.Jones, Marion L.Lemon, Patricia R.Miller, Patricia L.Miller, Ronald V.Mossinger, JacquelynNicodemus, RosemaireRains, W GlennReistad, Loren E.Shimerdla, Teresa L.Wagner, Thurston

CaliforniaMcCarn, George B.

ColoradoAnderson, A Franklin Anderson, Le Roy K. Andrus, James I. Aspinwall, Darrell D. Becker, Rose Marie Donahoo, William C. Eye, Joan M. Fox, Dennis C. Hill, Gordon Hill, Rowland D. Holt, Charles M. Kruse, Evelyn C. Mackey, Mildred H. Mccarty, Kenneth V. Raborn, Patricia J. Roberts, Helen P. Thayer, Steven R. Trevithick, Richard A. Vance, James E. Waymire, Clifford E. West, Cleo J. Woodruff, Dwight A. Young, Judy E.

FloridaJohnson, Donald Scherer, Gene E.

GeorgiaDayson, Elnora D.

IowaBrekke, Marjorie H. Buff, Harriette P. Carlson, Virginia R. Clement, Dorothy O.

Davis, Richard H. Demarce, Ethel C. Donohoe, Mary H. Eggleston, Rebecca T. Ellsworth, Oreen F. Farris, Jack Hilmer, Albert D.Janssen, Donald P. Jurgens, Cynthia A. Keating, Leone A. Krafka, Edward J. Poole, Vern B. Selix, Virginia R. Taft, Betty J. Tetmeyer, Margaret A. Thompson, J C Till, Regina E. Vanwoert, Alice T.

IdahoAllen, Lee R. Booth, Sherman C. Coleman, Ethel R. Fields, Ardella G. Goddard, Robin Nadine Kropp, Ted C. Parris, Janet E. Pridmore, B LoisVenn, Andrew G.

MinnesotaBauman, Arthur C. Benson, Borghild F. Colford, Jeanne Craddock, Harold R. Dahl, Louise M. Deziel, Helen N. Dimaio, JohnEcklund, Howard E. Felty Sr, John D. Frentress, Robert Graves, Geraldine M. Hall, Patrick H. Hammerlind, Gerald O. Hansen, Harold Hilber, Edward J. Homan, Emogene K. Johnson, Bonita Juenemann, Mary V. Litterick, Irene R. Mueller, Mary K. Nelson, Floyd A. Nelson, Mildred F. Nelson, Rose S. Olson, Eunice N. Owens, Thomas P. Schmidt, Kathleen S. Shoultz, George L. Shull, Aurora B. Simmons, Richard Wayne Smith, Blanche A. Thielen, Norma E. Voss, Donald M. Wallstedt, Ruby T. Wengeler, Dolores F. Zimmerman, E Lucille

MissouriKlamen, Jeff B.

MontanaCowles, Maurice G. Dufresne, Louis H.Fanning, Michael M.Freeburg, Lester V.

Nelson, Engar A. Talmage, William H. Wandler, George F.

North DakotaHanson, Florence E. Rader, Robert H. Wasylow, Patrick J.

NebraskaBorre, Junior W. Burton, Kenneth D. Gindt, Daniel Hopkins, Nevin W. Vanzago, Walton M.

New MexicoGallegos, Patricia C. Horton, Willie W. Kuenstler, Murrell J. Shaw, Neva J.

OklahomaClark, Patricia J. Smith, Reba M.

OregonAlexander, Donald L. Bailey, Jerry D. Baldwin, F B Bryson, H. Christenson, G ACowley, Marie B. Dunkin, H K Ewalt, E AGoudge, Laverda J. Hayes-Cook, Russell A. Heiberg, Marian Housley, R VHuston, George F. Jones, J F Kenny, Emmett F. Kinyon, Charles B. Krog, WLewis, Lynn B. Mason, Ethel E. Mcafee, Donald M. Willhoft, James O. Zellner, Fran

South DakotaHall, Ethel H. Harter, Bertha I. Koerner, Mabel H. Voels, Dawn

TexasAshby, Carolyn K. Beddo, Kathy Breidenstein, Blanche M.

Finley, Laverda Gamm, Donald L.

UtahAllred, Patricia A. Brown, H Ann Carver, Helen C. Corbeil, Manda M. Dubois, Richard Jachmann, Lydia J. Johnson, Ethel R. Justice, Shirley V. Kerr, Lorraine S. Lamph, Jane C. Mcintire, Brigham O. Myerhoff, G Raymond Roundy, Iona Saunders, Fern Leon Wallace, Anna B.

WashingtonAdams, E TBarber, D M Barth, William K. Bell, J N Benjamin, E. Benson, A G Bishop, H LBones, H TBoothby, Frances Brathovde, Patricia I. Burns, M Carlson, Phyllis J. Carmichael, Miriam Clark, Myrtle M. Crosby, Brian P. Cummings, Earl A. Desmarais, Albert H. Dixson, Florence G. Douglas, B R Dubois, Kenneth E. Elliott, Todd K. Fielder, R F Fingerhut, M H W.Froehler, Ronald Girard, Wesley S. Hager, G MHansen, E LHarrison, James H. Hawkins, Margaret L. Hicks, Lillie M. Hutchison, M LJess, S LKoenig, Janet D. Kriss, Helen A. Lavalle, C U Lee, Geraldine E. Leonhard, George H. Lindquist, Francis V. Mcginley, Mary L. Mckay, Gretchen A. Mulligan, Robert J. Odem, Jean I. Peterson, Frank T. Roselle, Robert S. Schroeder, John L. Seal, Anna Smith, Patrick R. Thorsen, H G Velder, Donald E.Williams, J B Wooten, Ellen L.

WisconsinHedeen, Lois C.

WyomingCisneros, Amelia Haldeman, Mae Herbert, Ralph A. Juvan, William C. Van Dine, N Louise

Recently RetiredEmployees –1st Quarter 2005ArizonaAllen, James D.Allen, Loretta Carlise Anaya, Barbara A. Andersen, Donetta R. Baldwin, Charles A. Beicht, Douglas D. Bragg, Winda S. Bright, Judy L. Bushway, David W. Buxton, Teddy L. Chiarini Sr, Robert A. Coker, Virgil L. Colella, M Angela Colon, Nancy M. Couture, Robert L. Dougherty, Harry E.Enis, Annette M. Enright, Teresa L. Ericson, Max A. Evans, James M. Fekete, Barbara A. Fink, Larry D. Giurlanda, Rocco M. Goedhart, Brenda G. Gonzales, Ernest A. Groh, Peter D. Hagg, Dale L. Harlow, Stephen E. Hartman, Gerald W. Hillman, LaVonne R. Hine, Karen J. Huff, Terry A. Jacobi, Marsha L. Jasuale, James P. Jones, Vicki L. Kennedy, Cathleen M. Lax, Russell J. Lybeck, Dennis E. Mahoney, William T. Mayer, Franklin D. McCoy, Michael S. McDonald, John F. McPherson, Doreen M. Moraine, Richard A. Morben, Kay L. Murray, Linda C. Parra, Carlos H. Perguson, Jimmie D. Peters, Keith M.Pickrel, Greg J. Reach, Yvonne M.A.Reyes, Ruben R. Rhodeos, Gloria Belinda Robb, Robert G. Robledo, Rodolfo A.Rustad, Gary C. Ryan, Carolyn M. Sanchez, Ruben Sanfilippo, Anthony J. Serpa, Melvaceleste B. (continued on page 18)


CURTIS KENNEDY ADDRESS (continued from page 11)

Many people don’t agree with me, and don’tthink that what I’m doing is necessary and worththe trouble. “Can’t we just trust these people? Whathave they done?” I heard this all the time when Iwas fighting the health care issue. “What are you soworried about?”

Well, I know I’m not always right, but I canguarantee you when it comes to these employeebenefits issues, I know what’s going to happen tothem. Your company’s going to find every way toweasel out, and dump you, and dump the problemsomehow. So we’ve got to use the existing laws,we’ve got to ask for help, we’ve got to fight, we’vegot to take preemptive measures. And you’ve got toget involved, which you are, and support thisorganization so it can continue to do these things.

With the potential MCImerger, the death benefitwould be one of manytargets. There’s a real taxincentive for them toeliminate that. If you cut thedeath benefit, you get what’sknown as a curtailmentincome gain. On thecompany bottom line, theyget to write that they’veearned income by getting ridof a liability. Something likea $300-million gain.

One of the things wedon’t want to see happeningis the company giving outlump sum payment plans inlieu of severance. They gaveout a lump sum payment to13,000 people under the Joe Naccio regime. A half-year to a year of pay, instead of coming out ofoperating revenue, it came out of the pension plan.They can’t do that any more. The pension plandoesn’t have enough money in it to constitute asurplus that would allow them to give that away. Bythe way, who does the surplus belong to? Judgesruled it belongs to the company. The company usedthe surplus as severance pay. Spent it all. Theyshould have put it back into the pension fund fromwhich it came, but... Then, looking for more funds,the company eyes the death benefit.

Responding to a question about the potentialQwest-MCI merger, after covering possible conse-quences, Curtis said, “Let me comment further. Isupport Qwest. I’ve got a lot of my investments inQwest. And I think that we’ve got to see thiscompany survive. Obviously. I don’t want to beat

them up and have them pay out punitive damagesand whatever, because it doesn’t help the company.But how were they going to get this MCI deal? Thisis the way they think. They were going to fire12,000 workers. Is that good for the country? Whatthe heck? That’s good for the officers. And there’sother ways Qwest could survive. But get the MCIdeal, consequently getting rid of 12- to 15-thousandpeople, as soon as we do it, that’s horrible. I’d liketo see the company survive, but not on the backs of15,000 families.

“By the way, that brings me to an issue we keeppromoting in all of these groups. If you don’t haveQwest as your service provider, for some reasonyou signed a sweetheart deal with Verizon or I don’tknow, some of these other companies, you’ve got to

think about what you’redoing. Every one of youshould have no qualms aboutsupporting Qwest, andhaving them as yourtelephone provider. Even ifit’s $5.00 more a month.How many subscribers whoare paying whatever a monthdoes it take to pay yourhealth care bills? You need tohelp the company survive.You need to tell your friendsto buy Qwest. Even if youhear about the competitionout there. Somebody’scharging $20 a month forthis. Someone’s charging$25. Think about it. There’s alot of you out there who

don’t have Qwest as your telephone provider, andyou’re kind of shooting yourself in the foot,indirectly. So the $10 you’re saving a month couldgo a long way to help the company meet itsexpenses. So, go back there and change. Switchback over to Qwest, and support the organization.

“I hope I have answered your questions and Ihaven’t offended too many of you with myfrankness about what’s going on. I don’t want youto leave with the impression that you should bealarmed about the condition of the Qwest pensionplan. What you should leave with is theunderstanding that you cannot trust the leadershipto look after you, to do what’s in your best interest.And the Bell-shaped head has to get changed. Andyou need this Association to fight for you. Becauseif you didn’t have this organization, they wouldhave already run over you.”


verify with accuracy the worth of the Fund.There are serious flaws and omissions today in

the practice of discharging the fiduciary respon-sibility by the Pension Plan Trustees and Advisors.The ERISA statute (Section 1103) states that “afiduciary shall discharge his duties with respect tothe Plan solely in the interests of participants andbeneficiaries.” Something has been clearly lost inthe current diluted conception of “fiduciary” underERISA. Let me share just a few of the manyexamples:

According to a study in 2002, about 69% ofcorporate profits reported in 2001 were “derived”by companies including into their bottom linesinflated estimated gains in value of their pensionfunds. Additionally, it has been estimated that 2001corporate profits, some $150 billion, did not reallyexist. This speaks volumes about how ERISAfiduciary responsibilities have been corrupted.

ERISA’s main goal was to assure adequatefunding of defined benefit pension plans. Yet,according to published sources as announced by theUnited States Treasury Department, “Americanpensions are under funded by some $300 billion” –in other words, some $300 billion short of payingthe legal promised pensions according to theERISA law.

There are a number of peculiarities of ERISAthat combine to render it virtually impossible for

pension plan participants to acquire any meaningfultrust or verifications to the assertion that thepension plan is “secure”.

Other issues, such as audits, timeliness, andactuarial assumptions need to be addressed in anyplan for amending the ERISA law.

This review is by necessity a very brief over-view of some of the short comings of the presentERISA law. It may be boring, but it impacts us allfinancially; and is, therefore, worth studying. Mycomments have been lifted, plagiarized, andotherwise borrowed from an accumulation of workdone by a committee of legal experts. The LucentRetiree Association quarterbacked the datagathering and included the solicitation from legalsand other experts throughout the country. Asmentioned before, the accumulated data, along withrecommendations, is now in the hands of the legalstaff in Washington (NRLN). When the platform iswritten, it will be reviewed and voted on by theNRLN Board of Directors. At that point, we shallendeavor to find a courageous Congressperson andSenator to introduce the bill into Congress. Weshall, once again, call on the necessary grass rootssupport to get the measure passed, and, believe me,given the present composition in Congress, that willnot be a “walk in the park” – it will be a “dog fight”.Somehow, someway, we must prevail.

God speed and good luck.

A VIEW FROM WASHINGTON (continued from page 4)

HEALTH INFORMATION ON THE WEBThere are a number of new websites on the Internet with health information for older adults.

They are:

Your Gateway to Health and Aging Resources on the Web(www.healthinaging.org/agingintheknow1). Includes general information about diseases and disorders afflicting older adults.

NIHSeniorHealth (nihseniorhealth.gov2), National Institutes of Health’s Web site for older people. It includes easy-to-understand information for novice computer users. There is information about diseases and sleep disorders.

Health Compass (www.healthcompass.org3). To help older adults find and evaluate reliable information about aging andhealth and utilize and navigate the Web to better understand medical research.

Hospital Compare (www.hospitalcompare.hhs.gov4). It shows how most of the country’s general hospitals performcompared with state and national averages, and against local competitors.

Medicare (www.medicare.gov5). Starting in January, the program added information on: cardiovascular screenings thatcheck your cholesterol and other blood fat (lipid) levels once every five years; diabetes screening tests up to twice a year forpeople at high risk for the disease; and an initial physical exam done within six months of enrollment in Medicare Part B, forwhich the beneficiary has to make a 20% co-payment.

Preventing health problems can save you money. The premiums for Medicare Part B, covering doctor visits and otheroutpatient services, are expected to rise 14% to $89.20 per month in 2006, up from $78.20 this year.

Information from The Wall Street Journal, Encore, April 17, 2005.


LEGAL ACTIVITIES

In recent years, many corporate employersproviding health care benefits for retirees, havebeen looking for ways to decrease the cost of this“legacy liability.” Employers have considered plansto either reduce or completely eliminate employersponsored health care for retirees who are age 65and older and, thus, eligible for Medicare. But,engaging in that type of action would constitute agediscrimination; specifically forbidden by the federallaw Age Discrimination in Employment Act(ADEA). Therefore, corporate employers heavilylobbied the Equal Employment OpportunityCommission (EEOC) to do them a favor –implement a rule or regulation that would exonerateany employer who did the dirty deed and,accordingly, cut or eliminated employer sponsoredhealth care coverage for persons who are Medicareeligible. The EEOC was happy to help out.

On April 22, 2004, the EEOC approved thefollowing rule or regulation that provides thefollowing exemption under the ADEA:

“(b) Exemption. Some employee benefit plansprovide health benefits for retired participants thatare altered, reduced or eliminated when theparticipant is eligible for Medicare health benefitsor for health benefits under a comparable Statehealth benefit plan, whether or not the participantactually enrolls in the other benefit program.Pursuant to the authority contained in section 9 ofthe Act [the ADEA], and in accordance with theprocedures provided therein and in ß 1625.30(b) ofthis part, it is hereby found necessary and proper inthe public interest to exemptfrom all prohibitions of the Actsuch coordination of retireehealth benefits with Medicare ora comparable State healthbenefit.”

Stated simply, the EEOC’sproposed rule or regulationwould create an exemption toallow employers, without re-striction, to reduce or terminateretiree health benefits when theretiree reaches age 65.

Before that rule or regula-tion could take effect, AARP and

four of its retiree members filed suit in PhiladelphiaFederal Court requesting an injunction prohibitingthe EEOC from implementing the rule. A monthlater, federal Judge Anita B. Brody, issued a 14 pageruling that strikes down the proposed rule orregulation. This ruling directly affects millions ofretirees.

Judge Brody found the EEOC’s proposedregulation directly conflicted with a 2000 decisionby the 3rd U.S. Circuit Court of Appeals thatexplicitly barred such a practice. In Erie CountyRetiree Association v. County of Erie, the 3rdCircuit held that allowing employers to give retireeswho are 65 or older health benefits that are inferiorto the health benefits given to younger retireesviolates the ADEA.

In the case before Judge Brody, the EEOCargued that without the exemption, employers willreduce or eliminate health benefits for all retirees,no matter what their age, because retiree healthbenefits are becoming so expensive that employerscannot afford to give the same level of healthbenefits to all. With the exemption, the EEOC said,employers could afford to offer greater healthbenefits to its retirees under age 65. Since thoseover 65 are eligible for Medicare, it argued, theyhave less need for employer-provided healthbenefits.

But, Judge Brody said the EEOC, may not issueregulations, rules or exemptions that go against theintent of Congress and the ADEA. In a writtendecision issued on March 30, 2005, Judge Brody

ruled the EEOCís proposed ruleor regulation was invalid. JudgeBrody said the EEOC was tryingto “issue a blanket exemption forillegal behavior,” and she “perm-anently enjoined [the EEOC]from publishing or otherwiseimplementing the challengedregulation.”

EEOC Chair CariDominguez issued a statementthat she would ask U S JusticeDepartment lawyers to appealJudge Brody’s ruling to the 3rdCircuit Court of Appeals.

by Curtis L. KennedyEEOC’s Proposed Rule to Allow Discrimination Against Older Retirees is Stricken Down;

Is There a Fox Guarding the Chicken House?

Stated simply, theEEOC’s proposed rule

or regulation wouldcreate an exemption to

allow employers,without restriction, toreduce or terminate

retiree health benefitswhen the retireereaches age 65.


IN THE MEDIAIN THE MEDIAFrom media coverage around the region and nation.

JACKSON, Miss. – MCI Inc. will pay $100million in cash to cover back taxes that itspredecessor WorldCom Inc. owed Mississippi, stateAttorney General Jim Hood announced Monday.

WorldCom collapsed in 2002 amid revelationsof an $11 billion accounting fraud to inflateearnings and hide expenses.

WorldCom, which got its start in Mississippi,was once headquartered in Jackson and later movedto nearby Clinton. WorldCom emerged from bank-ruptcy protection as MCI, which is based inAshburn, Va., and recently accepted an $8.54 billionbuyout offer from Verizon Communications Inc.

Hood said MCI did not admit any wrongdoing.MCI is also voluntarily making a $4.2 milliondonation to Children’s Justice Center of Mississippito benefit abuse victims and will make a payment of$14 million for Mississippi’s attorneys’ fees andcosts, he said.

“This agreement benefits MCI and the state ofMississippi, allowing us to put this issue behind usin a fair and equitable manner,” Carol Ann Petren,MCI deputy general counsel, said in a statement thatwas e-mailed to the Associated Press.

The telecommunications company also willturn over WorldCom’s former headquarters buildingin downtown Jackson to the state, Hood said. Thebuilding has not been appraised, he said.

Hood said the headquarters would be a symbolof the millions of dollars lost by state investors.

“They needed to leave a symbolic marker herefor the people to see what had happened to people’sretirement savings,” Hood said.

Hood said the $100 million will cover some ofthe $1 billion in back taxes, including corporateincome taxes, owed to the state for the period 1998to 2002.

In March, former WorldCom Chief ExecutiveOfficer Bernard Ebbers was convicted on charges of

fraud, conspiracy and false regulatory filings in theWorldCom accounting scandal. Ebbers’ sentencingis set for June 13.

Hood said the settlement was filed Monday inU.S. Bankruptcy Court in New York. He expectscourt approval later this week.

Mississippi’s claim for unpaid taxes, interestand penalties arose from an alleged complex taxshelter that the former WorldCom devised to avoidpaying income taxes by characterizing managementfees as royalties, rather than income or service fees,Hood said.

Under the settlement, outstanding state taxclaims against MCI related to the royalty programare dismissed, the company said.

Hood said at least 18 other states have also suedthe company over the royalty program, throughwhich WorldCom allegedly licensed intangibleassets – mainly “management foresight” – to itsunits in exchange for royalty payments totalingabout $19 billion.

“It was nothing but a tax evasion scheme,”Hood said.

“I’ve yet to find an accountant who’s ever heardof this term ‘management foresight’ where it wasworth a $1 billion in taxes.”

Hood said the state is seeking $900 million fromKPMG LLP, an accounting firm that he allegedhelped WorldCom come up with the scheme.KPMG replaced auditing firm Arthur Andersen LLPas WorldCom’s auditor shortly before WorldComcollapsed.

KPMG said Monday that it provided sound andappropriate tax advice as part of the company’srestructuring in the late 1990s.

“MCI/WorldCom was ultimately responsiblefor deciding whether, and how, to implement thatadvice,” spokesman George Ledwith said in astatement.

MCI TO PAY $100 MILLION FOR PREDECESSOR’S BACK TAXES

By Shelia Byrd -- Associated Press -- The Arizona Republic -- Tuesday, May 10, 2005

“It was nothing but a tax evasion scheme.”


Stock options are an economic incentive tocommit fraud.

Anyone aware of the allegations at Qwest –which restated billions in revenues after its topexecutives cashed millions in stock options – alreadyknows this.

“Why would you commit a fraud unless youwere going to benefit from the fraud?” says PurdueUniversity finance professor David Denis.

It sounds obvious. But in the world of academia,even the obvious must be statistically verified.

So Denis – along with Santa Clara Universityfinance professor Atulya Sarin and Purdue graduatestudent Paul Hanouna – studied 358 companies thatwere accused of fraud in shareholders’ lawsuitsbetween 1993 and 2002.

Their not-so-surprising conclusion: The morestock options companies give their executives, themore likely they are to be accused of fraud.

Most of the frauds covered by the study fellsquarely into two categories: Misstated financialreports or misrepresented prospects.

In 1984, stock-based compensation made up lessthan 1 percent of CEO pay for the median company.By 2001, that figure had climbed to 66 percent,according to research cited in Denis’ study.

Shareholders in the 1980s were upset whenCEOs got raises as their stocks crashed. So theypushed for stock options to align management’sinterests with their own.

Under this plan, executives would receiveoptions to buy stock at a certain “strike price.” Ifexecutives managed their companies well, the stockswould climb above the strike price and the executiveswould get rich for a job well done. But Denis’ studyunderscores that stock options have a dark side aswell.

After an unprecedented spate of corporate fraud,the use of stock options is now in decline. They wereonce a way for companies to print money – issuingpaper to key executives and employees instead ofcash. But beginning June 15, large publicly tradedcompanies will be required to report stock options asexpenses. Once they become expenses, they willhave to be doled out sensibly.

“This is more of an indictment of boards ofdirectors than the use of options,” Denis said of hisstudy. “When you have options in place, you’ve gotto be more careful, and boards of directors have notbeen careful.”

Indeed. Few batted an eye at reports of enormousstock-option profits until after the market crashed.

STUDY AFFIRMS PERIL OF STOCK OPTIONS

By Al Lewis -- Denver Post Business Columnist -- Tuesday, March 22, 2005


Critics of consolidation in the telecommunicationsindustry warned members of Congress that specificremedies would be necessary to ensure consumers arenot harmed by a series of recently proposed mergers.

The proposed acquisitions of AT&T Corp. by SBCCommunications Inc. and MCI Inc. by VerizonCommunications Inc. raise questions about howsmaller players will be able to compete, they told theSenate Judiciary subcommittee on antitrust, compe-tition policy and consumer rights in a hearingyesterday.

The mega-companies could, among other things,drive up costs by requiring customers to buy multiple

services bundled together, even if consumers don’twant them, Consumers Union senior director GeneKimmelman said.

Smaller providers are concerned about gettingaccess to the larger companies’ Internet and phonenetworks and getting a good connection over thoselines. An executive with Vonage Holdings Corp., anational provider of Internet phone service, toldmembers of Congress that regulators must police thelarger phone companies, which might otherwiseblock companies such as Vonage from transmittingtheir own calls or connecting to the 911 emergencycalling system.

MERGER CRITICS SEEK TELECOM REGULATION

By Yuki Noguchi -- Washington Post -- Wednesday, April 20, 2005


WESLEY COLVIN V. QWEST-- NOTICE OF PROPOSED SETTLEMENT --

Junta, Colorado on Wednesday, June 22, 2005, at1:00 p.m. During that hearing, the parties and legalcounsel will ask the judge to give final approval tothe settlement.

Very Important: In order for an eligible retiree toreceive the benefits described in the proposedsettlement, he or she must submit a Claim andRelease form that will be sent to the primaryresidence by mail within several weeks after the June22, 2005 Settlement Approval Hearing. The Claimand Release form must be timely returned to theClaims Manager at the address shown on the Claimand Release form. AUSWR ncourages retirees toregularly check the AUSWR websitehttp://www.uswestretiree.org/legal2.htm and look forupdates under “Colvin v. Qwest.”

If an eligible retiree wishes to be excluded fromthe Settlement Class and become ineligible forsettlement benefits, he or she must submit a writtenand signed Request for Exclusion stating that he orshe wishes to be excluded from the Settlement Classand any participation in the Settlement.

Wesley Colvin (represented by AUSWRAttorney Curtis L. Kennedy) filed a class actionlawsuit against Qwest on March 11, 2004, andclaimed Qwest had improperly terminated retireetelephone concession benefits that Qwest had beenproviding to its retirees who live in areas in whichQwest does not provide local telephone service.There has been a settlement agreement reached andnotice is being mailed to the 3-4000 persons eligibleto participate in the proposed class settlement.Among other things, the agreement provides for alump sum $300 cash payment and free lifetimeunlimited long distance services (both in-state andout-of-state) to each eligible retiree. The settlement isbinding upon any Qwest successor in interest.

If you are one of the eligible retirees and you donothing in response to the notice mailed to you, youwill remain a member of the Settlement Class andwill be bound by the Settlement if the Settlement isapproved by the Court.

Please note that a final “Fairness Hearing” willbe held at the Otero County District Court in La

Management Retirees Health Care Costs – The DarkSide of ERISA”

“In September 2003, Qwest CommunicationsInternational, Inc. announced it had made dramaticchanges to its employee benefit plans providingpotential benefits to retirees. In particular, thecompany announced that it would begin requiringmanagement retirees who retired after January 1,1991, to pay a portion, at least 20%, of the annualcosts of the premiums to provide heath care coverage.The changes caught many by surprise, as they had

If you are like me, the increased co-pays fordoctor visits, and definitely the monthly paymentsfor medical insurance, and prescription medicationsare making a significant impact on your financialsituation.

Following is a summary of the status of post ‘90retiree healthcare. What can and is being done. Whatcan’t be done. What you can do to help.

Legal: As a reminder, on October 11, 2004,AUSWR staff attorney Curtis Kennedy released tothe leadership and general membership of AUSWRthe following document: “Re: Post-1990 Qwest

by Susan JohnsonThe following is a very brief summary of the class notice Qwest will have mailed in

late April 2005, to those 3-4,000 retirees who are eligible to participate in the proposed classsettlement in the Colvin v. Qwest case (Retiree Telephone Concession case).

JUST WHAT IS AUSWR DOING INHEALTH CARE FOR POST ’90 RETIREES?

Susan Olson, Past President, Arizona TRA-AZ



expectations Qwest would continue to provide freehealth care benefits, like historically provided by U SWEST, Mountain Bell and the former Bell Systemcompanies. Every week, I continue to get manye-mails about this issue as many post-1990management retirees wonder whether or not a legalchallenge can be made.”

“The short answer: No. The attachment is a tenpage report in Adobe PDF file format explaining thereason there is no viable legal challenge option.”

Note: That attachment is available on theAUSWR www.uswestretiree.org. Click on “Bene-fits”, then “Health Care”. If you do not have accessto the internet yourself and want to see the longversion, I suggest you ask a friend or family memberto pull it up for you.

Curtis continues to monitor Qwest’s actions tomake sure that they don’t try to get away withsomething that can be challenged.

Retiree Advocates: These diligent volunteershave “resolved many cases for post ‘90 retirees whenthe plans are violated or misinterpreted byUnitedHealthcare. We have also helped many whodid not receive the proper treatment with their pen-sions” according to Howard Rickman, OmbudsmanRetiree Advocacy Program for AUSWR.

Howard further reports that some of the mostactive and successful Advocates across the 14 statesare post ‘90 retirees and they work very hard toensure that their peers receive the treatment andcoverage they should.

At the National Level: Your AUSWR leader-ship recognized some time ago that the healthcareissue is not unique to Qwest and its retirees. It ismuch larger than that. As a founding member of theNational Retiree Legislative Network (NRLN),AUSWR has been ably represented on their board ofdirectors by Nelson Phelps and now Mimi Hull.Mimi now chairs the NRLN Affordable Health CareCommittee. Hazel Floyd, President of CO/WYAUSWR, also sits on this committee and obtainedfor us the following report.

Progress Report on Affordable HealthcareJohn R Kotson; IBM RetireeChairman of the Rocky Mountain Action Coalition(RMAC)

“For the past four years, NRLN has pursuedlegislation entitled “The Healthcare Restoration Actof 2001”, HR1322. This legislation, introduced byCongressman John Tierney of Massachusetts, wouldrequire corporations to restore retiree healthcarebenefits that were in effect at the time a personretired. This would have been a great deal for most

retirees as many corporations have been reducinghealthcare benefits for retirees for the past decade.Unfortunately, the Bill has not garnered the neededsupport for a vote in the House of Representativesand a Senate sponsor has not been found.

Last year, NRLN decided to explore otheroptions for healthcare reform. A team was formed,with John Kotson (IBM Retiree) as chairman, toconduct a survey of other organizations to determineif a consensus existed on what an affordable health-care program should contain. While the responseswere limited, a representative cross-section wasobtained from healthcare advocacy groups, industry,labor unions, retiree organizations and insurancecompanies. There were several areas of agreementand some disagreement among respondents. Areas ofgeneral agreement were; everyone should becovered, a core set of medical benefits should beavailable to everyone, quality of care should beimproved, consumer involvement and educationshould be stressed, and some form of cost sharingshould be implemented. There was general concernexpressed over cost and cost management. The majorarea of disagreement was over single payer versusmultiple payer healthcare plans.

Based on these results, it was recommended thatNRLN select an approach that emphasized that areasof agreement but also could accommodate the areasof disagreement. The National Coalition on Health-care specification for reform was selected as theapproach that best fit these recommendations. Thisspecification is entitled “Building a Better Health-care System” and can be viewed on websitewww.nchc.org. The NRLN Board of Directorsagreed to endorse this approach.

A healthcare sub-committee was established byNRLN with Mimi Hull, AUSWR President as itschairman. The committee has established severalobjectives and is actively working them. First, we arecontinuing a dialog with NCHC to determine theirfuture plans, whether they intend to propose legisla-tion to implement their proposal and when. Second,we are identifying the many healthcare reformproposals that have been published. Third, thecommittee is starting to evaluate some of the health-care proposals against the NCHC specification forreform. Fourth, we are sending letters to Congres-sional Representatives requesting that they evaluatethe NCHC specification to determine if they wouldsupport this approach for affordable healthcare.Finally, we are attempting to gain insight into thecosts associated with medical practices includingprescription drugs. The committee’s goal is to have a

HEALTH CARE FOR POST ’90 RETIREES (continued from page 7)




At Qwest, CEO Dick Notebaert and CFO OrenShaffer participate in the Qwest executive pensionplan. Right now, the company estimates that wouldbe worth $1.85 million to Notebaert and $497,000 toShaffer if they retired at age 65.

But Qwest has a bonus for the two men,veterans of Chicago telco Ameritech before it wassold to SBC Communications under their leadership.

Qwest will take the SBC pension plan and addup the benefits Notebaert and Shaffer would havereceived had their Qwest service actually been withSBC instead. Then they’ll figure out the boostedSBC pension and pay the extra benefit on top of whatthey already get from both the SBC and Qwest plans.

That benefit, Qwest estimates, is worth $15.1million to Notebaert and $3.06 million to Shaffer.

EXECUTIVE PENSION BENEFIT SCOREBOARD

By David Milstead -- Rocky Mountain News -- Saturday, May 7, 2005

Top executives of U S West Inc. took signifi-cant pay cuts in 1991 as the Englewood basedtelecommunications company faced losses fromreal estate investments and job reductions.

The pay of Richard McCormick, U S WestPresident and chief executive officer, was cut nearly23 percent last year, from $851,800 to $660,000,according to a shareholder proxy statement filedwith the Securities and Exchange Commission.McCormick also received no incentive pay underthe company’s short-term incentive plan.

VP Richard Callahan, $486,900 to $392,500.Chairman and former chief executive officer, JackMacAllister, $1.24 million in 1900, last year of bothpositions.

President and chief executive officer, Gary Ames,a 7.5 percent cut to $499,230.

Note: Ada says, “Mr. McCormick wanted to denythe 1996 pension raise but the board overrode himand approved the raise April 1995 that startedFebruary 1996 for management personnel inNebraska. The fellas of today have it a bit LARGER.”

U S WEST EXECUTIVES PAY CUT – THE GOOD OLD DAYS

Ada Bork, who enjoys re-reading the Omaha World Herald, March 29, 1992. -- Englewood, Colo. (AP)

Qwest plans to sell about 2,400 phone lines inNew Mexico to Sacred Wind, a rural telephonecompany formed to serve the Navajo Nation, wheremost residents are without phones.

The land lines would be incorporated into awireless system that Sacred Wind wants to build onthe 25,000-square-mile reservation, said John Badal,a consultant with Sacred Wind. Terms of the deal areexpected to be worked out by the end of the month,he said.

The companies haven’t announced a sale pricefor the lines. The number to be sold is too small toimprove the financial condition of debt-strappedQwest, which owes $17.2 billion, said Janco Partners

analyst Donna Jaegers.But Qwest will rid itself of lines on Navajo land

where the population is small, spread out and costlyto serve.

The line sale would be the first by Qwest since2001, when the company sold 35,000 access lines inUtah to a consortium of small Utah phone companiesfor $90 million.

Regulators who are members of the QwestRegional Oversight Committee asked companyrepresentatives at a recent meeting if Qwest wasplanning to sell more lines in its 14-state region, saidTony Clark, a North Dakota regulator who ischairman of the committee.

QWEST TO SELL NEW MEXICO LAND LINES

By Tom McGhee -- Denver Post Staff Writer -- Saturday, April 9, 2005


Mary Ann Neuman’s reaction was immediate andheartfelt when she heard that the U.S. Securities andExchange Commission had filed fraud chargesTuesday against former Qwest CommunicationsInternational chief executive Joseph Nacchio and sixof his ex-lieutenants.

“There is a God!” the 59-year-old Qwest retireefrom New Hope said.

As she heard the names of the former Qwestofficials who were charged, including former ChiefOperating Officer Afshin Mohebbi, Neuman said, “Ohgood, they’re getting all his cronies.”

“He just raped and pillaged the company,”Neuman said. “You just felt violated.”

The depth of Neuman’s anger against Nacchiomay seem unusual, but in Minnesota, where 4,600people still work for Qwest, many past and presentemployees are still boiling mad at their former boss.

In their eyes, Nacchio dismantled a once greatcompany and put their jobs and retirements injeopardy. Qwest, in part because of actions underNacchio’s tenure, skirted bankruptcy a couple yearsago and is still hobbled by more than $17 billion in

debt.Qwest’s weak finances are hurting its present

struggle to woo long-distance giant MCI away fromthe much larger Verizon Communications. Qwest isoffering $8 billion in stock and cash for MCI, but theMCI board hasn’t budged from its deal to be acquiredby Verizon for $6.75 billion, saying Verizon isstronger financially than Qwest and presents a betterlong-term partner.

Qwest, and predecessors U S West and North-western Bell before it, had matched employeecontributions to personal retirement accounts usingcompany stock. The stock’s share price soared in thelate 1990s into the low $70s, but after the merger,Qwest’s stock dropped to under $2. It now trades atunder $5 a share.

Neuman is one of those people hurt by thecompany’s change in fortune. When Qwest’s stockprice peaked after the merger at about $51 a share, herportfolio was worth more than $220,000. At Tuesday’sclosing price, it was worth less than $17,000.

The difference is more than $200,000.“That’s what Joe owes me,” she said.

QWEST EMPLOYEES SAW SAVINGS RUINED

By Leslie Brooks Suzukamo -- St Paul Pioneer Press -- Wednesday, March 16, 2005

EXECUTIVE PERKS SCOREBOARD

Rocky Mountain News -- May 7, 2005


To view these and many other articles that may affect Qwest retirees, go to our new andimproved website: www.qwestretiree.org and click on In the Media.

Qwest Communications lavished Chairman andChief Executive Dick Notebaert with more than ahalf-million dollars in perks, the Denver-basedtelecommunications company’s proxy showed,though that’s actually less than the amount hereceived in the previous year.

Personal use of the corporate jet came to$189,296, financial consulting services totaled$74,336, and a personal assistant and related officeexpenses hit $46,841. Another $75,000 was for

“flexible benefits” or the perk of his choice, thedocument showed.

Notebaert, who took home a salary and bonuslast year of $4.1 million, also received about$180,000 in “gross up” payments to reimburse himfor taxes he paid on some perks.

Qwest spokesman Bob Toevs would notelaborate on the extra benefits, saying only theywere “part of his employment agreement.”


recommended healthcare reform approach to NRLNin time for the next BOD meeting in early 2006.

Your AUSWR Editorial Board will follow up onthe progress of this effort. In the meantime,becoming better informed yourselves and supportingany initiatives from NRLN will be a good way to

HEALTH CARE CLAIMSMonte Shriver

If you are a pre-91 retiree on Medicare and haveRetiree Health Care Medical Plan 1, here is what youneed to know about the relationship between Medi-care and United Healthcare reimbursements. Whenyou or any of your eligible dependents become eli-gible for Medicare, claims should be submitted toMedicare first. Once you receive the Medicare Sum-mary Notice, you can then file with United Health-Care by sending in a copy of the Summary Notice.Your Medicare Summary Notice includes your socialsecurity number but I recommend you add your UHCID and Group numbers to the Medicare Form.

The Medical Plan states that “To determine theamount payable after Medicare’s payment, benefitsthat would be available in the absence of Medicareare calculated first. These benefits are then reducedby any benefits payable from Medicare, whether ornot you actually apply for benefits from Medicare.Your combined payment from Medicare and the Planwill never exceed the amount available under theQwest Plan alone”. There are two categories ofclaims with Medicare: Assigned Claims andUnassigned Claims. The Medicare Summary Noticeindicates whether the claim is assigned orunassigned. An Assigned Claim means that theDoctor has agreed to accept the Medicare approvedamount. Once you meet the annual Medicaredeductible, Medicare will pay the Doctor 80% of theapproved amount and you will pay the 20% balance.Since the Qwest Plan would also pay the same 80%(after the Qwest deductible has been met), you wouldreceive no reimbursement from the Plan.

Doctors who do not accept assignment areallowed to charge you 15% above the Medicare

approved amount. In this case, you can generally filewith UHC to be reimbursed 80% of the additional15% the doctor is allowed to charge. For example, ifthe Medicare approved amount for an office visit is$100, Medicare would pay $80.00 or 80% of the$100.00 approved amount. The doctor would billyou $115.00. Per the Plan quoted above, UHC wouldcalculate your reimbursement at 80% of the $115.00or $92.00. They would then subtract the Medicarepayment of $80.00 and reimburse you $12.00. TheMedicare payment of $80.00 and the UHC paymentof $12.00 totals to $92.00 which is exactly thereimbursement that you would have received fromUHC prior to being on Medicare.

UHC will still base the overall allowance on“reasonable and customary charges” or the “limitingcharge” as UHC now refers to it. In most cases, whena doctor does not accept assignment and charges the15% above the Medicare approved amount, thatamount will still be less than the reasonable and cus-tomary charge so you should receive reimbursementfrom UHC as calculated above. In many cases, UHCemployees have tried to treat “unassigned claims”the same way as they treat “assigned claims” andhave denied retirees their proper reimbursement. Iunderstand UHC has now clarified this issue in theirinstructions.

Monte Shriver is a Pre-91 retiree and RetireeAdvocate for New Mexico. Prior to retirement,Monte was in charge of the U S WEST AccountingWitness organization. Upon retirement, he was aloaned executive as an Adjunct College Professor atNew Mexico State University in the Center for PublicUtilities. Upon leaving New Mexico State University,he was appointed by New Mexico Governor GaryJohnson to the New Mexico Public UtilityCommission where he served in 1997.

help. Their website is www.nrln.org.Susan Olson compiled this information from

several sources including the “Progress Report onAffordable Health Care” by John Kotson, an IBMRetiree who is also chairman of the Rocky MountainAction Coalition (RMAC).

RETIREE ADVOCACYIn general, the following applies to all four of the pre-91 Health Care Plans with some very minor differences. Manyproviders send a bill to UHC and also furnish UHC with a copy of the Medicare determination and payment. We haveasked Qwest to do this and they have declined. It would greatly reduce the administration costs and the provider wouldreceive their payment much sooner if UHC needs to pay. -- Howard Rickman, Ombudsman

HEALTH CARE FOR POST ’90 RETIREES (continued from page 8)


helping to organize this group to begin with. Eldon hasreally been our go-to man. He’s like that real goodtight end. A guy that when, you’re deep in trouble, youthrow the ball to him and gets a few more yards - getsthe job done. That’s always what Eldon does. And I’mhopeful, Eldon, that even though you’re dropping outas a director, we can still call you on occasion. Wealways value your input.”

For 23 years I have been focusing my practiceon helping out the former Bell Sytem retirees. That’swhat I do. I work alone. I have no secretary. I haveno support staff. I get around on my Harley as anattitude adjustment, because I am constantly dealingwith some really troubling issues for people.

We’ve evolved to the stage where we are now,where you retirees are the legacy liability. Youinterfere with the ability of the company to compete.Because now they compete with a lot of upstartcompanies that don’t have the legacy liability. Theydon’t have the pension plan. They don’t haveretirees who they have to pay health care for. Thatmakes it tough.

How do they handle this. They renege on the

commitments and the promises that they’ve made toyou. I saw this coming because I’ve done a lot ofthis work in the 80s and I saw how the attitude in thecompanies changed.

You may have heard about me in 1994. TheUnger case. This was a class action suit where Icaught a U S West spending pension money, aboutnine to ten million dollars, on company matters –salaries and travel expenses that should have beenpaid out of operating revenues.

As we resolved the Unger case for a $9-millionpayment back to the pension plan, the next thing Isaw was that the company was sending out all thisliterature to employees saying help us help you byjoining the HMO. A benefit to the company; a

Eldon Ranney: In 1998, Jim Shaw and I had thefirst organizational meeting of this Association. Jimand I temporarily served as co-chairs. Later, we wereelected to the board. Jim was very, very busy startingand handling the company advocate plan. In fact, hemade hundreds of phone calls and made manycontacts to help people with things that had to do withtheir benefits and Jim really deserves this award. Itsays, “Above and Beyond” Award, presented to JimShaw, in grateful appreciation for dedicated andgenerous service. Northwestern Bell/U S West RetireeAssociation, May, 2005.

Chairman Larry Smith: “We wish to recognizethe job that Eldon Ranney has done, since he began

CURTIS KENNEDY ADDRESS TONWB/U S WEST ANNUAL MEETING

ELDON RANNEY PRESENTSTHE TOP AWARD AS HE STEPSDOWN FROM THE BOARD

OVER 200 RETIREES GATHER IN FARGO MAY

Jim Shaw, recipient of the“Above and Beyond” Award.

Eldon Ranney


questionable change for the employees. And postageand expenses were paid out of the pension planrather than operating expenses.

I examined company documents and there’s thisclause in the retiree health plan. It said, we canchange this any time we want. We can take it awayany time we want. I’m paraphrasing, but that’s themeaning of the legalese language. I said to NelsonPhelps, “This is really bad. They really should havein there a promise to pay your health benefits for therest of your lives. Let’s make them put it in there.”Phelps said, “Right on. Let’s do it.”

So we filed what I call a preemptive strikeagainst the company. They hadn’t done anythingwrong yet. But I could guarantee you they wouldhave.

Lawyers from the large Colorado and Californiafirms opposing me indicated they would have thiscase tied up for years and we had no chance to win.But we organized union and grass roots efforts,letter writing, publicity campaigns, and had somecourt cases on the matter. And the company decidedto resolve this thing – forpolitical reasons. Partly be-cause they’d just been bashedfor doing “no-no” with thepension plan. Partly becausewe still had people who werehonorable that were in chargeof the company, who wantedto do the right thing. Andpartly because we had themass media working with meand we had the retirees gettingorganized. And guess what?They put a guarantee in therethat protects everyone whoretires before January, 1991,saying “you will never pay apenny over what you werepaying before for your healthcare. You will never pay amonthly premium. You will

never be forced into an HMO. Your prescriptiondrug coverage is covered the same regardless of thisMedicare law that’s in effect.” You guys are theprotected species in this organization.

And guess what? I did it all for free. 30,500people benefited from my work that was inspiredbecause I saw the need for this, and the retireeorganization was a catapult from that. And if youwere a pre-1991 retiree, please raise your hand. (Amajority in the room raised their hands!) You’ve gota lot to be thankful for. You’ve got friends who’veretired a few years later and they are paying what,$300 a month, $400 a month, maybe more, forhealth care? You’re not. What I want you to do isshow your appreciation and write a check for somenominal amount to this organization. You owe it tothis organization. This is what they’re doing. This iswhat I’m doing. You’re saving hundreds and hun-dreds of dollars a month for what this organizationdid for you, even though the Northwestern Bellgroup wasn’t aware of it.

What are we doing now? Taking a preemptivestrike against Qwest regardingyour death benefits. I call it apension death benefit, paid outof the pension plan. It wasfunded, it was charged to theratepayers, it was always fac-tored in as a commitment thatthe company would carry out.

Barry Allen came tocompany leadership 18 monthsago and said, “We’ve alreadydrafted a letter. We’re going tosend notices to everybody.We’re going to cancel the deathbenefit.” Your Associationapproached me for help. Werecently filed anotherpreemptive strike to get Qwestto guarantee this death benefit,just like the health care.

Y 19TH FOR NWB/U S WEST ANNUAL MEETING

Curtis Kennedy (continued on page 16)

Documents

Retiree Advocates: Membership Application IOWA & … · [email protected] Secretary Rose Bailey, Sioux Falls, SD 605-336-7771 [email protected] ... noted that as a retiree group, we