OE News Special Edition July 2013

News 

Special Edition: 38 th Annual Report 

Operating Engineers’ Benefits & Pension Plan 

Publications Mail Agreement No. 40011378 

July 2013 www.iuoe115.com

IUOE News is the official 

publication of the International 

Union of Operating Engineers 

Local 115. 

Local Executive Board 

Business Manager 

Brian Cochrane 

President 

Wayne Mills 

Vice-President 

Brad Randall 

Recording Secretary 

Brian Lefebvre 

Financial Secretary 

Don Swerdan 

Treasurer 

Frank Carr 

Guard 

Bob Higgs 

Conductor 

Dave Hannis 

Trustees 

Brett Chapman 

Brian Moore 

Curtis Wright 

Auditors 

Chip Dhaliwal 

Goretti Guibault 

Craig McIntosh 

District Executive Board 

1—Al Cooper 

2—Tim Cullen 

3—Brad Gerow 

4—Herb Conat 

5—Mike Spiruda 

6—Brian Lefebvre 

Publication Committee 

Brian Cochrane 

Wayne Mills 

Lynda Arland 

Editorial Services 

Susan Armstrong, COPE 378 

Working Design, CEP Local 2000 

4333 Ledger Avenue, 

Burnaby, B.C., V5G 3T3 

Telephone: 604-291-8831 

Fax: 604-473-5235 

Website: www.iuoe115.com 

E-mail: iuoe@iuoe115.com 

Please 

Recycle 

On the cOver Designing an employee 

benefits plan requires precisely engineered and 

coordinated moving parts, much like the jewel 

movements found inside a Swiss watch. Both are 

engineered to work seamlessly, efficiently, and 

provide a lifetime of quality benefits. 

About 345 retirees and spouses enjoyed an evening of socializing, dinner and entertainment 

at the 2012 Operating Engineers’ 34th annual Pension Social Evening. 

REpoRts 

Staying the Course 

Brian Cochrane, Chairman 1 

Investment Performance Portfolio Review 

Trustees 3 

Letter from Income Security Consultant 

Strategic Income Security Services 4 

Letter from Actuary 

Ellement and Ellement 5 

Administrator’s Financial Report 

Shawn Hatch, Administrator 6 

Auditor’s Report: Pension Plan 18 

Auditor’s Report: Benefits Plan 28 

FEatuRE 

Retirees’ Social Evening 23

MEssagE FRoM thE ChaiRMan 

Staying the course on prudent 

management and the importance 

of long term growth 

Dear Brothers and Sisters, 

In keeping with our proud traditions, I am 

pleased to present this 38th Annual Report, on 

behalf of the Board of Trustees and the Staff of 

the Operating Engineers’ Benefits & Pension 

Plans. 

Pension Plan 

Management of the pension funds you rely on 

for your retirement is a tremendously important 

responsibility, and often a challenging one. This 

past year has proven to be a volatile investment 

and low interest rate environment, which has 

required a prudent and conservative management 

approach. 

Your Board of Trustees’ primary objective is 

to ensure the greatest certainty possible with 

respect to the payment of the benefits that the 

Plan has promised to provide. I am therefore 

pleased to report that the investment strategy 

adopted by the Board is proving successful in 

achieving this goal. 

Throughout the past year, the Board has 

received many reports and presentations from 

economists, investment managers and other 

professional advisors. Based on this information 

the Board has concluded that it should stay the 

course regarding its investment strategy for the 

coming year. 

Our investment portfolios are heavily weighted 

towards fixed-income assets. This strategy is 

in-line with the conservative approach required 

in the management of a mature pension plan 

such as ours. 

Given the particular assets we have selected 

their value continues to respond to interest rate 

changes in the same way as the value of our liabilities 

do. Declines in interest rates have been an 

Brian Cochrane, 

Chairman 

Michael R Fanning 

speaking on the IUOE 

Pension Funds at the 

38th Annual IUOE 

Conference 

Special Edition Summer 2013 News 1

issue for pension plans. Our investment strategy 

has, by design, largely protected us from this 

issue. 

Benefits Plan 

This has been a year of significant change for the 

Operating Engineers’ Benefits Plan. 

Extended Health and Dental benefits are now 

being provided through Pacific Blue Cross. This 

has resulted in a number of improvements in 

service delivery for our members, most notably 

point of purchase drug claim reimbursement 

through the drug card. 

At the same time, members 

MEMBERship gRowth LEaDs to are experiencing a number of 

inCREasED MaRkEt shaRE, whiCh new Pacific Blue Cross proce- 

BuiLDs thE union’s stREngth dures and policies designed to 

FoR thE FutuRE. help in the prudent financial 

management of the Benefits 

Plan. Your patience and cooperation in this 

regard will assist in helping us keep the cost of 

benefit coverage for our members in line. 

With respect to disability benefits, the level of 

our long term disability benefit has been raised 

to $2,000 per month for all new claims. At the 

same time, our existing long term disability 

claimants received an ad hoc increase in their 

benefit ranging from $50 to $400 per month. 

Going forward Great-West Life will be administering 

long term disability benefits while the 

2 News Special Edition Summer 2013 

Operating Engineers’ Benefits Plan office will 

continue to administer weekly disability 

benefits. 

You will note in the financial statements contained 

in this report that 2010/11 hours of contribution 

improved by approximately $2,000,000 

for the year. This is a sign of an improved work 

picture and the organizing efforts of our Union. 

In closing 

In closing it is important to note that the prudent 

investment strategies and fiscal management of 

the benefits plan can only go so far in securing 

the long-term stability of the OEBPP. The other 

key factor is membership which drives increased 

hours of covered employment. 

Membership growth leads to increased market 

share which in turn builds the Union’s 

strength for the future. We also need to maintain 

a constant influx of new and younger members 

to provide a balance to an aging demographic. 

The Local Union Executive Board is very committed 

to these values which will keep our membership 

and finances on very stable footing. With 

your assistance, we will be successful in reaching 

these goals which will in turn, over time, increase 

our market share, increase our bargaining 

strength, and provide strength to our benefits 

and pension plans. 

Our organizing efforts continue to focus on 

building the Union. Your organizers cannot do 

this in isolation, we all have a large stake in this 

and we all need to play a role. The best contribution 

you can make is to be informed and engaged 

with the growth of the Union by helping to sign 

up new members. 

Anti-worker groups continually try to discredit 

the rights of our members who benefit 

from plans such as ours. We at the IUOE believe 

workers have the right to “Rise Above” and that 

the best way to reach that goal is a sound defined 

benefit pension plan and a well-designed benefits 

plan such as ours. 

Fraternally, 

Brian Cochrane, Chairman 

Brothers of IUOE Local 115 

commemorating the Ironworkers 

Memorial on June 17th

a MEssagE FRoM thE tRustEEs 

Investment portfolio is performing well 

and trustees will continue to review 

Frank Carr Don Swerdan 

Brian Lefebvre Brian Cochrane 

Tim Cullen Brad Randall 

Ted Carlson Brian Savage 

Since the last report to members of the Operating 

Engineers’ Benefits and Pension Plans 

Employer Trustee Gary McIntosh resigned and 

was replaced by Brian Savage. 

This past year there have been a total of 9 

meetings between the Pension Plan and the Benefits 

Plan. In addition, the Trustees have attended 

several educational presentations regarding 

the economy and investment strategy. 

The Trustees devoted a great deal of time to 

monitoring the performance of the Pension Plan 

investments and considering whether any changes 

to the overall investment policy were necessary. 

For the time being the Trustees are satisfied 

that the investment portfolio is performing 

well and that no immediate DuRing thE yEaR, thE 

changes are required. Looking tRustEEs ContinuED with 

ahead, the Trustees will continue to thE iMpLEMEntation oF kEy 

review the investment strategy and BEnEFit iMpRovEMEnts 

consider whether a shift in strategy 

is required, especially if we continue to see prolonged 

periods of low interest rates. 

The Trustees are also satisfied with the investment 

returns of the Benefits Plan trust fund. 

During the year, the Trustees continued with the 

implementation of key benefit improvements 

including elimination of the $25 extended health 

deductible, increasing both accidental death & 

dismemberment and group life coverage from 

$40,000 to $60,000, increasing the weekly disability 

benefit, increasing the long term benefit 

to a flat $2,000 and introducing point of sale 

drug reimbursement. 

In keeping with the fine traditions of our 

Local union your Trustees carry out their onerous 

responsibilities without compensation and 

are reimbursed only for those out of pocket 

expenses that are reasonable and necessary to 

carry out our duties. 

The Trustees are preparing for a challenging 

year ahead and are committed to working hard 

to do the very best we can for our members. 

Fraternally, 

Your Trustees 


4 News Special Edition Summer 2013

E 

& 

E 

May 7, 2013 

ELLEMENT & ELLEMENT 

CONSULTING ACTUARIES 

The Trustees of the 

Operating Engineers Local 115 Pension Plan 

C/o Lionel Railton, Administrator 

402 - 4333 Ledger Avenue 

Burnaby, BC 

V5G 4G9 

Dear Trustees: 

Re: Market Conditions and Current Investment Strategy 

Airport Executive Centre, 503 - 1780 Wellington Avenue, Winnipeg, Manitoba. R3H 1B3 

Telephone: (204) 954-7300 Toll-Free: (888) 840-1045 Fax: (204) 954-7310 

Website: www.ellement.ca E-mail: contact.us@ellement.ca 

“benefit security at 

a reasonable cost” 

I have read the letter dated April 25, 2013 prepared by Strategic Income Security Services Ltd. 

(SISS) and agree with its contents. 

In particular, we agree that while long term interest rates may rise in the near future such 

increases will be limited. The professional advisors agree that it is more prudent and in the best 

interests of the OEPP to not attempt to time such movements via changes in the current 

investment strategy. 

In any event the current investment strategy adopted by the Board of Trustees has positioned 

the Plan’s assets such that it minimizes the risk of adverse financial consequences in both down 

and up interest environments. 

We agree with SISS that there is no need to change the strategy at this time but continued 

monitoring of the markets will take place to determine if changes in the current investment 

structure should be contemplated. 

Yours truly, 

ELLEMENT & ELLEMENT 

Louis Ellement 

Actuary 

cc: Mr. Shawn Hatch, OEPP 

Mr. Jim Cole, PH&N 

Mr. David Lee, SISS 

COMFORT LTR MAY 2013 


aDMinistRatoR’s REpoRt 

A conservative strategy provides 

stability in volatile times 

I am pleased to present the 38th Annual Financial Statements of the Operating Engineers’ 

Benefits and Pension Plans (OEBPP). The Auditor has prepared these statements for the 

review of Plan members, and they reflect the stewardship of the Plan’s assets by your 

Trustees. 

With the continuing and unprecedented turmoil in the world’s financial markets, your 

Board of Trustees believes the move in 2002 to an Asset-Liability Matching Policy has provided 

your pension plan stability during these difficult times. As described in previous editions of 

this Special Edition your Trustees approved this investment strategy to ensure the long-term 

stability of your pension plan. 

As you will read, the Plan’s investment strategy is unchanged from the previous year. This 

strategy is intended to give you, the Plan members, a higher level of certainty with respect to 

the benefits you are relying on for your retirement. This conservative strategy is consistent 

with what a large majority of participants told us they prefer. 

2012 proved to be another year of volatile investment returns and low interest rates. Our 

investment strategy, which is detailed below, is constantly monitored and tested to ensure 

compliance with the risk parameters established by the Board and their advisors. 

Investment policy providing greater certainty 

Due diligence 

The Trustees approved the investment strategy after intensive assessment, on the basis of 

extensive professional advice, and with the involvement of provincial regulators. 

The process began with computer modeling through which the performances of different 

types of assets were assessed – relative to the liabilities of the plan, and in light of 

possible changes in interest rates and stock market performance. The strategy has 

thE stRatEgy is DEsignED 

been accepetd by the provincial Superintendent of Pensions, who has responsibil- to givE MEMBERs a highER 

ity for overseeing pension plan management. 

LEvEL oF CERtainty with 

The strategy was scrutinized by five different actuaries: the OEPP’s own actuary, REspECt to BEnEFits 

a special consultant engaged to develop the strategy, and three independent actuaries 

(two engaged by the OEPP, and one by the Superintendent of Pensions). 

Asset-Liability Matching: The basic principle 

Our strategy involves both a significant adjustment in the mix and nature of assets we hold, as 

well as a plan specific long term discounted cash flow assessment of the value of some of those 

assets (particularly real estate). The anticipated level of future returns will be much more certain, 

and the plan will be better protected from the potentially negative impact of changes in 

interest rates and stock market performance. 

The basic principle behind an Asset-Liability Matching Policy is simple, and is summed up 

in the name. The policy requires us to hold assets that we expect will deliver an income stream 

coming as close as possible to matching the estimated liabilities of the Plan (the promises to 

pay benefits to members), over a given time period – regardless of what may happen to interest 

rates and the stock markets. 


Shawn Hatch 

Administrator

The interest rate impact 

The following is an example of interest rate impacts. If I want to pay you a certain amount of 

money now, in return for your promise to pay me $1 per year indefinitely, the amount I’ll have 

to pay depends on current interest rates. If rates are high, I’ll be able to pay you less, because 

you’ll have the opportunity to invest the money I pay you at a high rate of return. 

In other words, I need fewer assets now to secure certain future payments when interest 

rates are high. And I need more assets when interest rates are low. 

A pension plan works the same way. The plan has assets now and needs to make certain 

payments in the future. The current value of a pension plan’s future liabilities (and therefore 

the assets it needs now to meet those liabilities) goes down as interest rates rise, and goes up as 

interest rates drop. 

In other words, a pension plan needs fewer assets to make the same future payments 

when interest rates are high than when interest rates are low. 

This has been a growing problem in recent years as interest rates have steadily declined, 

resulting in an increasing level of liability for the OEPP and other pension plans. By shifting to 

a different mix of assets, the Trustees believe we can protect our plan against the impact of low 

interest rates, and of interest rate changes generally. 

The Plan’s asset mix 

The large majority of our assets continue to be made up of bonds. A bond is simply a promise 

to re-pay a certain amount of money at a specified date, with interest payments in the interim 

based on a fixed rate. It is a “fixed-income asset”, meaning that there is no doubt as to the rate 

of return it will deliver. The only risk relates to the survival of the bond issuer. Although this 

can be an issue with corporate bonds, it is much less of an issue with government bonds. The 

pie charts below show all of the Operating Engineers’ Pension Plan assets by class and what 

each manager holds 

By asset class 

0.4 % Real Estate – 

Mortgages (internal) 

2.5 % UBS Global 

Asset Management 

0.8 % Fengate 

Capital Management 

4.6 % 

Mortgage Fund Two 

0.3% Realcor Mortgage 

Fund (external) 

Real Estate 

– Revenue 

Producing 

20.6% 

PHN – Bonds 

60.4% 

0.2 % Real Estate – 

Non-Revenue Producing 

5.6% Prepaid Leases 

3.3% Concert Properties 

1.3% Short-term 

Interest Rates and 

Promises to Pay 

Cost of a promise of a 

$1/year indefinitely, at 

different rates 

Cost Interest Rate 

$10.00 10% 

$16.67 6% 

$20.00 5% 

$25.00 4% 

$33.33 3% 

$50.00 2% 

Interest Rates 

and Pension 

Plan Liabilities 

As 

interest 

rates 

drop.... 

... the 

value of 

pension 

plan 

liabilities 

rises. 


By investment manager 

Pension Plan 

Administrator 

10.2% 

Realty Inv 

Division (Total) 

21.2% 

PHN – 

Bond Fund 

60.4% 


0.3% Realcor Mortgage 

Fund (external) 

2.5% UBS Global 

Asset Management 

4.6% Mortgage 

Fund Two 

0.8% Fengate 

Capital Management 

The following table illustrates the investment returns of each investment manager over the 

past two years: 

OPerating engineers’ PensiOn Plan DecemBer 31, 2012 

rate Of return By asset manager 

Aug - Dec. 4 Mths. 

% 

May - Aug. 4 Mths. 

% 

Jan. - Apr. 4 Mths. 

% 

TOTAL MANAGER RESULTS 

Phillips Hager & North - Bond Fund 1.2% 6.2% (2.5)% 4.5% 15.0% 

Mortgage Fund Two 1.2% 4.4% 0.7% 6.5% 11.2% 

Fengate Capital Management - - - - - 

UBS Global Asset Management 1.4% 6.5% 

1 Year 

% 

2 Year 

% 

- - - 

Realty Investment Division / 

Realcor Mortgage Fund 15.7% (12.5)% 14.4% 15.8% 

Pension Plan Administrator 8.3% (6.3)% 10.4% 12.1% 12.1% 

TOTAL FUND 4.8% 0.6% 2.2% 7.7% 13.6% 

The most important point, however, is what bonds do in response to interest rate changes. If 

interest rates are high, the value of a bond will be less than when interest rates are low. The 

same principles are at work as in the example above. The promise of fixed future payments is 

worth more in a low interest rate world because alternative investment opportunities are less 

attractive. 

In other words, the current value of bonds goes down as interest rates rise, and goes up 

as interest rates drop. 

11.3%

Greater certainty in all investment climates 

Since our plan’s assets continue to be heavily focused on bonds, the value of our assets and 

liabilities will largely move in tandem in response to future interest rate changes. If interest 

rates were to rise, the current value of both our liabilities and our assets would go down. Similarly, 

if the trend towards lower interest rates continues, both values will increase. 

This is the most important part of the “match” that an Asset-Liability Matching Policy 

requires. When there’s a match between asset and liability income streams, there’s certainty 

that future payments can be made. 

In moving to bonds, we have moved away from stock market or equity assets. Equities have 

no fixed rate of return, and therefore cannot be reliably matched against anticipated liabilities. 

Also they do not respond in a predictable way to interest rate changes. 

As interest rates decline, we know that the value of our future liabilities will increase. But we 

don’t know what will happen to the value of the equities – it may stay the same, it may decrease, 

or it may increase (although the rate of increase may or may not match the rate of increase in 

liabilities). These multiple possible outcomes – most of which result in a mismatch between 

assets and liabilities – reduce the certainty that the plan will be able to meet its future 

obligations. 

Because of their unpredictability, equities create inherent challenges for Trustees in the 

management of pension plans. What has made matters particularly difficult in recent 

times is the fluctuation of asset values in the stock markets, coupled with increases in plan 

liabilities as a result of declining interest rates. 

Better valuations 

Inherent in the OEPP’s investment strategy, and in the Asset-Liability Matching Policy that 

governs it, is a careful and consistent assessment of the current value of both our assets and 

liabilities. 

On the liability side, we are concerned with future cash payments to members, in the years 

and decades ahead. On the asset side, we therefore also need to be concerned with the longterm 

cash flows that will be generated. 

As the investment policy of the Plan is to hold revenue producing properties indefinitely 

and to not sell any of these properties unless an investment of better value can be obtained, the 

Plan values these properties using an assigned value method. The assigned value method is 

based on the present value of the net future cash flows using a discounted cash flow method. 

The cash flows are discounted at an interest rate equal to the actuarial assumption rate used to 

determine the value of the liabilities of the Plan. 

Greater certainty, but not complete 

The Trustees believe they have achieved the most advantageous match possible between the 

Plan’s existing assets and liabilities. 

It is important to note, however, that our plan is not completely protected from the negative 

effect of interest rate changes. Our asset pool is simply not large enough, even in light of the 

valuation of our real estate holdings, to put us in that position. 

We continue to rely on a portion of future contributions from members to pay for benefits 

already earned, a situation common to many pension plans, and largely a function of the 

impact that interest rate declines and stock market volatility have already had on our plan. 

Interest Rates, 

Pension Plan 

Liabilities and Bonds 

As 

interest 

rates 

drop … 

... and so 

does the 

value of 

bonds. 

... the 

value of 

pension 

plan 

liabilities 

rises … 

thE tRustEEs BELiEvE 

thEy havE aChiEvED thE 

Most aDvantagEous 

MatCh possiBLE 

BEtwEEn thE pLan’s 

Existing assEts anD 

LiaBiLitiEs. 


Looking ahead 

Your Trustees have determined that our investment strategy is prudent and appropriate for 

our plan at this point in time. They will continue to closely monitor economic and financial 

trends, and the health of the Plan so that any necessary adjustments can be made in a timely 

fashion. 

Implications of declining interest rates 

There have been a number of articles in the media about the funded status of pension plans. 

Many pension plans are in trouble for a variety of reasons. Most of these reasons can be traced 

back to the lack of adequate investment performance based on the investment policies being 

followed by many plans. This has resulted in plans having insufficient assets to cover their liabilities 

for benefits earned to date by plan members. 

We are pleased to report that based on the most recent actuarial valuation of the Operating 

Engineers’ Pension Plan, the total assets of the Plan are more than sufficient to cover the liabilities 

for all benefits currently being paid and benefits earned to date by active members. 

Your Board of Trustees adopted an investment strategy that was designed to select assets of 

the Plan which would be sufficient to provide all benefits earned to date with a high degree of 

certainty, no matter if long term interest rates went up or down or stayed the same. The strategy 

involved investing a large portion of the Plan’s assets in a portfolio of long duration bonds. 

In recent years, long term interest rates have fallen significantly. However, because of our 

investment strategy, the value of the Plan’s assets has increased at a faster rate than the value of 

the earned pension benefits. The strategy has worked well and has provided for the reduction 

and over time the elimination of our past under funding. 

Because we are unable to invest future contributions until we receive them and because we 

cannot predict what interest rate levels will be when we do receive the contributions, it is not 

possible to fully protect future service benefit levels against the possibility of lower interest rates. 

When we adopted our current investment strategy we were advised and understood the strategy 

might not be able to protect future service benefit levels in a dropping interest rate environment, 

particularly where long term interest rates stay at low levels for a long period of time as they 

have done recently. 

When most of us joined the Plan, we typically expected investment returns of 7% per annum, 

and this was the basis used to establish pension benefit levels. Higher long-term investment 

returns would provide for higher future benefits, all other things being equal. With that being 

said, over the last decade the long term interest rates have fallen steadily. This means that the 

cost to finance benefits earned in the future has risen while the contributions made today and 

in the future will earn lower rates of return than expected when the benefit levels were established. 

The only way to offset this increased cost is to continually monitor and if necessary 

amend the level of future benefits to reflect the lower interest rate environment we are currently 

living in. 

To illustrate the impact of future investment returns falling from 7% per annum to 4.5% per 

annum, consider an active plan member, with a contribution rate of $2.45 per hour with 1,600 

hours of annual contributions accruing a monthly pension benefit of $70.56 per year of membership. 

The cost of this pension at 7% is $1.95 per hour vs. $3.12 per hour at 4.5%. 

You can see that if investment returns are only 4.5% per annum, the pension benefit that can 

be provided is 37% lower than if the investment returns are 7% per annum. For the same pension 

benefit rate to be provided when only 4.5% per annum returns are available, contribution 

rates would have to be increased by 60%. To put this more simply, if we were starting a new pension 

plan today with the same level of contributions, we could not support the same level of benefit 

for the future. A simple rule of thumb for determining the reduction needed in benefit levels 


BECausE oF ouR 

invEstMEnt stRatEgy, 

thE vaLuE oF thE 

pLan’s assEts has 

inCREasED at a 

FastER RatE than thE 

vaLuE oF thE EaRnED 

pEnsion BEnEFits.

is this: for every 1% drop in long term interest rates, the required reduction in benefit levels 

would be 20%. This situation affects all pension plans in our current economic environment. 

The purpose of this communication is to alert the membership that if long term interest rates 

stay at present levels or continue to fall it may be necessary to adjust future service benefits levels 

for accruing pension members. 

It is also important to note that the long-term health of our pension plan continues to depend 

on a strong membership, and in particular on the recruitment of new members. As the Business 

Manager notes elsewhere in this report, all members have a responsibility to contribute to 

recruitment – and this is the best way you can support your Trustees’ ongoing work to ensure 

the stability of the pension plan you rely on. 

Pension Plan 

Actuarial Results 

The following tables are from Plan’s Actuarial Report as at April 30, 2012. They summarize the 

results of the going concern valuation, solvency valuation, and the normal actuarial cost calculation 

made. As the tables confirm the Board is proud to verify your Pension Plan continues 

to satisfy the going concern and solvency funding requirements despite the brutal global economic 

situation we are currently living through. 

PensiOn Plan actuarial results 

GOING CONCERN VALUATION 30-Apr-2012 30-Apr-2010 

Invested Assets at market value $1,013,752,735 $782,235,346 

Liabilities (964,630,000) (772,039,700) 

Going Concern Excess/(Unfunded Liability) $49,122,735 $10,195,646 

Funded Ratio 105.1% 101.3% 

SOLVENCY VALUATION 30-Apr-2012 30-Apr-2010 

Invested Assets at market value less expenses $1,012,452,735 

$780,935,346 

Liabilities (991,836,800) (760,651,600) 

Solvency Excess/(Deficiency) before allowance for the excess of 

expected contributions over the normal cost $20,615,935 $20,283,746 

Present value of the excess of expected contributions over the normal 

cost - next 5 years (11,300,486) 5,040,373 

Solvency Excess/(Deficiency) after allowance for the excess of 

expected contributions over the normal cost $9,315,449 $25,324,119 

Solvency Ratio 102.1% 102.7% 

CONTRIBUTION REQUIREMENTS 30-Apr-2012 30-Apr-2010 

Annual Amount Amount Per Hour Annual Amount Amount Per Hour 

2013 Plan Year 2011 Plan Year 

Normal Cost * $23,667,000 $3.43 $20,079,000 $2.91 

Going Concern minimum payment 

Additional amount to satisfy funding of solvency deficiency 

Total Required Contributions $23,667,000 

- 

- 

- 

- 

$3.43 $20,079,000 $2.91 

Expected Contributions 20,700,000 3.00 20,700,000 3.00 

Excess/(Shortfall) of expected contributions over total 

required contributions $(2,967,000) $(0.43) $621,000 $0.09 

Special Edition Summer 2013 News 11 

- 

- 

- 

-

gOing cOncern valuatiOn Balance sheet 

ASSETS 

Invested Assets at market value (Appendix I) $1,013,752,735 

LIABILITIES 


30-Apr-2012 30-Apr-2010 

$782,235,346 

Value of future benefits accrued to date 

(a) pensioners (2012: 4,585 / 2010: 4,429) 

- healthy $405,980,500 $342,478,700 

- disabled 12,321,200 9,908,900 

- survivors 42,783,000 36,590,200 

(b) present members (2012: 6,383 / 2010: 5,967) 

$461,084,700 $388,977,800 

- retirement pensions $404,521,300 $309,681,600 

- disability pensions 34,500 399,700 

- termination benefits 38,560,300 26,163,700 

- death benefits 11,265,800 8,616,500 

$454,381,900 $344,861,500 

(c) paid-up pensions /transfers to another union (2012: 2,555 / 2010: 2,894) 49,163,400 

38,200,400 

TOTAL LIABILITIES $964,630,000 $772,039,700 

GOING CONCERN EXCESS/(UNFUNDED LIABILITY) $49,122,735 $10,195,646 

FUNDED RATIO 105.1% 101.3%

sOlvency valuatiOn Balance sheet 

ASSETS 

30-Apr-2012 30-Apr-2010 

Invested Assets at market value (Appendix I) $1,013,752,735 $782,235,346 

Wind-up Expenses (1,300,000) (1,300,000) 

SOLVENCY ASSETS $1,012,452,735 $780,935,346 

LIABILITIES 

Value of future benefits accrued to date 

(a) pensioners (2012: 4,585 / 2010: 4,429) 

- healthy $417,108,000 $351,275,000 

- disabled 12,670,700 12,775,300 

- survivors 43,461,900 37,111,100 

$473,240,600 $401,161,400 

(b) present members (2012: 6,383 / 2010: 5,967) 461,468,000 318,233,500 

(c) paid-up pensions /transfers to another union (2012: 2,555 / 2010: 2,894) 57,128,200 41,256,700 

TOTAL LIABILITIES 

SOLVENCY EXCESS/(DEFICIENCY) before allowance for the excess of expected 

$991,836,800 $760,651,600 

contributions over the normal cost $20,615,935 $20,283,746 

Present value of the excess of expected contributions over the normal cost - next 5 years (11,300,486) 5,040,373 

SOLVENCY EXCESS/(DEFICIENCY) after allowance for the excess of expected 

contributions over the normal cost $9,315,449 

$25,324,119 

SOLVENCY RATIO 102.1% 102.7% 


Benefits Plan 

Cost Analysis for 2011/12 

As the tables below show, total benefit costs continue to increase year over year. Total costs for 

the fiscal year ended December 31, 2012 were $17,005,282 (pre-audit) as compared to 

$15,491,620 in 2011 amounting to an increase of $1,513,663 or 9.8%. The cost of providing all 

benefits per member per month was $310.76 in 2012 versus $306.45 in 2011. The hourly cost 

rose from $2.45 to $2.59. 

With the exception of Life Insurance and Long Term Disability all other benefits were higher 

in 2012. 

The one constant: your Plan continues to subsidize members’ medical benefits. 

Benefits Plan cOst analysis fOr 2011/2012 

2012 Cost Breakdown Pre-audit 2012 costs 


Average Eligible 

Members 

Cost per Member 

per Month Cost per Hour 

Medical 5,820,815 4,483 $108.20 $0.87 

Dental 4,628,679 4,338 $88.92 $0.71 

Extended Health 4,576,920 5,173 $73.73 $0.59 

Weekly Disability 800,104 3,443 $19.37 $0.15 

Life Insurance 844,963 5,154 $13.66 $0.11 

Long-term Disability 132,259 3,392 $3.25 $0.026 

Family Assistance 125,091 5,173 $2.02 $0.016 

AD&D Insurance 76,451 3,940 $1.62 $0.013 

17,005,282 

2011 Cost Breakdown Audited 2011 costs 

Average Eligible 

Members 

$310.76 $2.49 

Cost per Member 

per Month Cost per Hour 

Medical 5,000,678 4,167 $100.01 $0.80 

Dental 4,119,029 3,931 $87.32 $0.70 

Extended Health 4,262,100 4,798 $74.03 $0.59 

Weekly Disability 666,838 3,071 $18.10 $0.14 

Life Insurance 1,127,900 4,777 $19.68 $0.16 

Long-term Disability 136,154 3,019 $3.76 $0.030 

Family Assistance 109,660 4,798 $1.90 $0.015 

AD&D Insurance 69,261 3,455 $1.67 $0.013 

15,491,620 $306.45 $2.45

The three largest cost centers Medical, Dental & Extended Health have risen significantly 

over the past twelve years. In 2012 their combined total was $15,026,413 – almost as much as 

all of the benefits in 2011. 

While the two pie charts below look very similar they are indeed different as their titles 

indicate. You can clearly see how Medical, Dental & Extended Health make up the majority 

total benefit costs. 

Benefits cOst DistriButiOn 2012 

AD&D Insurance 

$76,451 

Extended Health 

$4,576,920 

Benefits cOst DistriButiOn 2011 

AD&D Insurance 

$69,261 

Extended Health 

$4,262,100 

Dental 

$4,628,679 

Dental 

$4,119.029 

Medical 

$5,820,815 

Medical 

$5,000,678 

Family Assistance 

$125,091 

Weekly Disability 

$800,104 

Life Insurance $844,963 

Long-term Disability 

$132,259 

Family Assistance 

$109,660 

Weekly Disability 

$666,838 

Life Insurance $1,127,900 

Long-term Disability 

$136,154 


The graph below includes the costs for all benefit categories dating back to 2000. While 

some benefit costs have been rather flat, the graph clearly shows how dramatically costs have 

risen in the Medical, Dental and Extended Health categories. Benefit Costs can be determined 

using the left (black) vertical axis of the graph. 

Not all increases are bad; membership has risen as well, tipping 5,000 at the end of 2012. 

Membership numbers can be determined using the right (red) vertical axis of the graph. 

trenDs: Benefit cOsts anD memBershiP 


aDministratiOn exPenses 

The following tables give a breakdown of administrative disbursements for the period commencing in 2000. 

OPerating engineers’ PensiOn Plan 

Year Ending Assets Contributions Expenses 

Expenses as a 

% of Assets 

Expenses 

as a % of 

Contributions 

Total Plan 

Participants 

Expenses 

per Plan 

Participant, 

per year 

April 30, 2000 $412,784,657 $18,644,501 $702,151 0.170% 3.77% 12,447 $56.41 

April 30, 2001 $416,350,954 $22,790,835 $678,916 0.163% 2.98% 12,654 $53.65 

April 30, 2002 $485,414,220 $17,144,904 $660,816 0.136% 3.85% 12,739 $51.87 

April 30, 2003 $490,087,308 $17,889,602 $811,192 0.166% 4.53% 12,836 $63.20 

April 30, 2004 $531,062,657 $18,511,783 $698,680 0.132% 3.77% 12,836 $54.43 

April 30, 2005 $611,447,912 $21,344,139 $685,298 0.112% 3.21% 12,836 $53.39 

April 30, 2006 $661,907,384 $26,948,233 $1,146,822 0.173% 4.26% 12,611 $90.94 

April 30, 2007 $727,512,372 $28,377,553 $980,418 0.135% 3.45% 12,870 $76.18 

April 30, 2008 $732,913,398 $31,418,564 $810,319 0.111% 2.58% 13,322 $60.83 

April 30, 2009 $713,473,674 $30,060,633 $1,065,027 0.149% 3.54% 13,450 $79.18 

April 30, 2010 $782,235,346 $26,235,516 $935,082 0.120% 3.56% 13,290 $70.36 

April 30, 2011 $844,956,804 $28,509,186 $1,015,967 0.120% 3.56% 13,274 $76.54 

April 30, 2012 $1,013,752,735 $35,479,577 $1,141,079 0.113% 3.22% 13,523 $84.38 

OPerating engineers’ Benefits Plan 

Year Ending Assets Contributions Expenses 

Expenses as a 

% of Assets 

Expenses 

as a % of 

Contributions 

Total Plan 

Participants 

Expenses 

per Plan 

Participant, 

per year 

Dec. 31, 2000 $25,930,085 $10,619,468 $723,469 2.790% 6.81% 11,406 $63.43 

Dec. 31, 2001 $24,181,086 $8,521,071 $722,317 2.987% 8.48% 11,118 $64.97 

Dec. 31, 2002 $24,494,360 $9,462,127 $604,709 2.469% 6.39% 10,448 $57.88 

Dec. 31, 2003 $24,853,971 $10,274,224 $523,110 2.105% 5.09% 10,108 $51.75 

Dec. 31, 2004 $26,374,356 $11,389,921 $593,624 2.251% 5.21% 10,249 $57.92 

Dec. 31, 2005 $29,643,824 $13,038,803 $711,203 2.399% 5.45% 10,712 $66.39 

Dec. 31, 2006 $32,057,915 $13,664,782 $799,280 2.493% 5.85% 11,116 $71.90 

Dec. 31, 2007 $32,345,223 $15,118,433 $847,359 2.620% 5.60% 11,719 $72.31 

Dec. 31, 2008 $31,073,300 $15,569,742 $772,521 2.486% 4.96% 11,994 $64.41 

Dec. 31, 2009 $34,303,853 $13,712,670 $810,404 2.362% 5.91% 11,660 $69.50 

Dec. 31, 2010 $34,216,220 $13,377,710 $837,022 2.446% 6.26% 11,016 $75.98 

Dec. 31, 2011 $36,414,701 $15,442,009 $980,032 2.691% 6.35% 11,943 $82.06 


Pensions 

working 

for you 


Operating Engineers’ Pension Plan 

Summarized Financial Statements 

for the years ended April 30, 2012 and 2011

REPORT OF THE INDEPENDENT AUDITOR ON THE SUMMARY FINANCIAL 

STATEMENTS 

To the Members of Operating Engineers’ Pension Plan: 

The accompanying summary financial statements, which comprise the summary Statements of Net Assets 

Available for Benefits as at April 30, 2012 and 2011, the summary Statements of Changes in Net 

Assets Available for Benefits, and the summary Statement of Expenses for the years then 

ended, are derived from the audited financial statements of the Operating Engineers’ Pension 

Plan for the years ended April 30, 2012 and 2011. We expressed a qualified opinion on those 

financial statements in our report dated September 24, 2012. Those financial statements, and 

the summary financial statements, do not reflect the effects of events that occurred subsequent 

to the date of our report on those financial statements. 

The summary financial statements do not contain all the disclosures required by Section 

9(7) of the Pension Benefits Standards Act of British Columbia. Reading the summary 

financial statements, therefore, is not a substitute for reading the audited financial 

statements of Operating Engineers’ Pension Plan. 

Administration's Responsibility for the Summary Financial Statements 

The administration and the Plan’s trustees are responsible for the preparation and fair 

presentation of a summary of the audited financial statements in accordance with Section 9(7) of 

the Pension Benefits Standards Act of British Columbia. 

Auditors' Responsibility 

Our responsibility is to express an opinion on the summary financial statements based on our 

procedures which were conducted in accordance with Canadian Auditing Standard (CAS) 810, 

“Engagements to Report on Summary Financial Statements.” 

Except as described in the Basis for Qualified Opinion paragraph, we conducted our audit in 

accordance with Canadian Auditing Standards. Those standards require that we comply with 

ethical requirements and plan and perform the audit to obtain reasonable assurance about 

whether the financial statements are free from material misstatement. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a 

basis for our qualified audit opinion. 

Basis for Qualified Opinion 

We did not review the accounting records of the participating employers to ascertain whether 

remittances made by them were in accordance with the requirements of the Plan. Accordingly, our 

work in respect of remittances from employers was limited to the amounts recorded in the books of 

the Plan. 

Qualified Opinion 

In our opinion, except for the possible effects of the matter described in the Basis for 

Qualified Opinion paragraph, the summary financial statements present fairly in all material 

respects the net assets available for benefits of the Plan as at April 30, 2012 and 2011 and the 

results of its operations and changes in net assets available for benefits for the years then ended 

in accordance with Section 9(7) of the Pension Benefits Standards Act of British Columbia. 

Vancouver, British Columbia 

April 11, 2013 

Chartered Accountants 


OPERATING ENGINEERS' PENSION PLAN 

Statement of Changes in Net Assets Available for Benefits 

For the Year Ended April 30, 2012 and 2011 


Statement of Net Assets Available for Benefits 

April 30, 2012 and 2011 

2012 2011 

Assets Increase in Book Value of Assets: 

2012 2011 

Contributions 

Current: Cooperative housing income 

$ 35,479,577 

176,094 

$ 28,509,186 

176,094 

Cash Dividends, and cash gains equivalents on sale of securities, and interest - 

908,108 $ 2,255,042 

Accounts Investments receivable managed under contract 

Prepaid Other expenses and deposits 

3,126,897 52,871,856 

29,083 267,742 

2,524,788 33,949,120 

52,735 148,926 

Real estate income 5,437,390 

4,064,088 

5,384,133 

4,832,565 

Other: 

94,232,659 68,167,459 

Decrease Term deposits in Book Value of Assets: 

Advances 

Benefit Payments - 

Equipment 

Cash terminations 

129,910 

3,773,275 

83,734 

4,774,039 

125,505 

2,087,209 

75,347 

4,586,192 

Death 

Pension 

Investments Managed Under Contract: 

228,634 

3,986,919 

40,215,596 

918,704 

2,288,061 

38,874,013 

ACM Advisors - Mortgage Fund 39,184,115 45,218,269 27,567,296 44,378,909 

Phillips Hager & North - Bond Fund 

Fengate Expenses- Capital Management 

UBS Global Administrative Asset Management 

Investments managed under contract 

615,851,258 523,791,683 

1,179,000 

25,000,000 1,141,079 1,015,967 

935,138 841,043 

Other 681,214,373 1,450 551,358,979 (21,087) 

Investments: 

Concert Real Estate Corporation 

2,077,666 

33,061,924 

1,835,923 

29,963,931 

Increase Cooperative in book Housing value of assets 

Community Savings Credit Union 

58,148,879 46,936,724 

175 

54,600,100 21,952,627 

173 

Realcor Mortgage Corp. 

Assigned 

Realty Investment 

and fair value 

Division 

adjustment 

Increase in fair value adjustment 

8,479,375 8,643,860 

225,523,590 193,973,424 

83,946,740 21,437,034 

Increase in assigned value adjustment 

325,213,942 

37,912,468 

287,181,487 

19,331,797 


$ 1,014,479,322 

121,859,208 

$845,661,092 

40,768,831 

Liabilities Increase in Net Assets available for benefits 168,795,931 62,721,458 

Net Assets Available for Benefits, beginning 

Current: 

844,956,804 782,235,346 

Net Accounts Assets payable Available and for accrued Benefits, liabilities ending 

Net assets available for benefits 

$1,013,752,735 726,587 $844,956,804 

704,288 

1,013,752,735 844,956,804 

$ 1,014,479,322 $845,661,092 

These summarized financial statements are not complete and do not contain all of the disclosures 

required under Canadian general accounting principles. A complete set of financial statements, and 

notes thereto, are available upon request from the Operating Engineers Local 115 Pension Plan 

Administrator.




2012 

Increase in Book Value of Assets: 

2011 

Contributions $ 35,479,577 $ 28,509,186 

Cooperative housing income 176,094 2012 176,094 2011 

Dividends, Increase gains on in Book sale of Value securities, of Assets: and interest - 

Investments Contributions managed under contract 

Other Cooperative housing income 

Real estate Dividends, income gains on sale of securities, and interest - 

52,871,856 $ 35,479,577 33,949,120 $ 28,509,186 

267,742 176,094 148,926 176,094 

5,437,390 5,384,133 


Other 

52,871,856 33,949,120 

94,232,659 267,742 68,167,459 148,926 

Real estate income 5,437,390 5,384,133 

Decrease in Book Value of Assets: 



94,232,659 68,167,459 

4,774,039 4,586,192 

Death Decrease in Book Value of Assets: 

228,634 918,704 

Pension Benefit Payments - 

40,215,596 38,874,013 


Death 45,218,269 

4,774,039 4,586,192 

228,634 44,378,909 918,704 

Expenses- 

Pension 40,215,596 38,874,013 

Administrative 


1,141,079 

45,218,269 

1,015,967 

44,378,909 

935,138 841,043 

Other Expenses- 

1,450 (21,087) 


Investments managed under contract 2,077,666 

1,141,079 1,015,967 

935,138 1,835,923 841,043 

Other 

Increase in book value of assets 46,936,724 

1,450 

21,952,627 

(21,087) 

Assigned and fair value adjustment 

2,077,666 1,835,923 

Increase Increase in fair value in book adjustment value of assets 83,946,74046,936,724 21,437,034 21,952,627 

Increase in assigned value adjustment 37,912,468 19,331,797 


Increase in fair value adjustment 

121,859,208 

83,946,740 

40,768,831 

21,437,034 


Increase in Net Assets available for benefits 168,795,931 62,721,458 

Net Assets Available for Benefits, beginning 844,956,804121,859,208 782,235,346 40,768,831 

Net Assets Increase Available in for Net Benefits, Assets ending available for benefits $1,013,752,735 168,795,931 $844,956,804 

62,721,458 

Net Assets Available for Benefits, beginning 844,956,804 782,235,346 

Net Assets Available for Benefits, ending $1,013,752,735 $844,956,804 




Administrator. 













Statement of Expenses 2012 2011 

Increase in Book Value of Assets: For the Year Ended April 30, 2012 and 2011 


Cooperative housing income 

Dividends, gains on sale of securities, and interest - 

Administrative: 


Actuarial Other and appraisals 

Real Amortization estate income 

Bank charges 

176,094 176,094 

2012 

2011 

52,871,856 33,949,120 

$ 267,742134,166 148,926 $ 124,798 

5,437,39025,1195,384,133 19,616 

6,600 6,605 

Consulting 

Education 

94,232,659 

229,250 

68,167,459 

206,749 

8,332 2,260 

Decrease Insurance in Book Value of Assets: 

Labour 


Material and supplies 


Miscellaneous 

Death 

Postage and courier 

Pension 

Professional fees 

50,522 56,444 

1,035,457 912,850 

31,056 29,112 

4,774,039 4,586,192 

100,273 91,833 

228,634 918,704 

49,019 44,912 

40,215,596 

95,664 

38,874,013 

88,355 

Public relations 

Rent 

114,498 118,405 

45,218,26971,369 44,378,909 70,737 

Telecommunications 

Expenses- 

Trustees 


12,219 13,551 

53,815 27,098 

1,141,079 1,015,967 


Other 

Cost Recoveries: 

935,138 2,017,359 

1,450 

841,043 1,813,325 

(21,087) 

Administration fees 2,077,66624,2801,835,923 17,358 

Management fees 852,000 780,000 

Increase in book value of assets 46,936,724 21,952,627 

876,280 797,358 


Totals Increase in fair value adjustment 83,946,740 $1,141,079 21,437,034 $1,015,967 


121,859,208 40,768,831 


Net Assets 

These summarized 

Available for 

financial 

Benefits, 

statements 

beginning 

are not complete and do 

844,956,804 

not contain all of 

782,235,346 

the disclosures 

required under Canadian general accounting principles. A complete set of financial statements, and notes 

thereto, are available upon request from the Operating Engineers Local 115 Pension Plan Administrator. 







34th annuaL pEnsion soCiaL 

Retirees gather for annual evening 

The 2012 Operating Engineers’ 34th annual Pension Social Evening 

attracted approximately 345 retirees and spouses to the Vancouver 

Italian Cultural Centre for an enjoyable evening of dinner and 

entertainment. 

This most popular event provides an opportunty for retired 

members and their spouses/guests to renew old friendships, 

reminisce on numerous shared projects during their careers and to 

exchange ideas and events pertaining to the enjoyment of their welldeserved 

retirement years. 

Those in attendance enjoyed a delectable buffet subsequently 

followed by entertainment and dancing. 

A special “Thanks” to all the Staff in the Benefits and Pension Plan 

office for their continued assistance and effort in ensuring the event’s 

success. 



34th Annual Retirees’ Social Evening

34th Annual Retirees’ Social Evening 



34th Annual Retirees’ Social Evening

34th Annual Retirees’ Social Evening 


Benefits 

working 

for you 

Operating Engineers’ Benefits Plan 

Summarized Financial Statements 

for the years ended December 31, 2011 and 2010 


REPORT OF THE INDEPENDENT AUDITOR ON THE SUMMARY FINANCIAL STATEMENTS 

To the Members of Operating Engineers’ Benefits Plan: 

The accompanying summary financial statements, which comprise the summary Statements of Net Assets Available for 

Benefits as at December 31, 2011 and 2010, the summary Statements of Changes in Net Assets Available for Benefits, 

and the summary Statement of Administrative Expenses for the years then ended, are derived from the audited 

financial statements of the Operating Engineers’ Benefits Plan for the years ended December 31, 2011 and 2010. We 

expressed a qualified opinion on those financial statements in our report dated April 30, 2012. Those financial 

statements, and the summary financial statements, do not reflect the effects of events that occurred subsequent to the 

date of our report on those financial statements. 

The summary financial statements do not contain all the disclosures required by Canadian generally accepted 

accounting principles. Reading the summary financial statements, therefore, is not a substitute for reading the audited 

financial statements of Operating Engineers’ Benefits Plan. 

Administration's Responsibility for the Summary Financial Statements 

The administration and the Plan’s trustees are responsible for the preparation and fair presentation of a summary of the 

audited financial statements in accordance with Canadian generally accepted accounting principles. 

Auditors' Responsibility 

Our responsibility is to express an opinion on the summary financial statements based on our procedures which were 

conducted in accordance with Canadian Auditing Standard (CAS) 810, “Engagements to Report on Summary Financial 

Statements.” 

Except as described in the Basis for Qualified Opinion paragraph, we conducted our audit in accordance with Canadian 

Auditing Standards. Those standards require that we comply with ethical requirements and plan and perform the audit 

to obtain reasonable assurance about whether the financial statements are free from material misstatement. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified 

audit opinion. 

Basis for Qualified Opinion 

We were unable to review the accounting records of participating employers to determine whether contributions were in 

accordance with the requirements of the Agreement and Declaration of Trust. Accordingly, our verification of employer 

contributions was limited to verifying that contributions received were properly recorded. 

Qualified Opinion 

In our opinion, except for the effect of adjustments, if any, which we might have determined to be necessary had there 

been no limitations in the scope of our examination of employer contributions as described in the preceding paragraph, 

these financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as at 

December 31, 2011 and the results of its operations and changes in net assets available for benefits for the years then 

ended in accordance with Canadian generally accepted accounting principles. 

Vancouver, BC 

April 11, 2013 

Chartered Accountants 





2012 2011 



Cooperative housing income 


176,094 176,094 

Investments managed under contract 52,871,856 33,949,120 

Other 267,742 148,926 

Real estate income 5,437,390 5,384,133 






94,232,659 68,167,459 

Decrease in Book Value of Assets: 


Cash terminations 4,774,039 4,586,192 

Death 228,634 918,704 

Pension 40,215,596 38,874,013 

45,218,269 44,378,909 

Expenses- 

Administrative 1,141,079 1,015,967 

Investments managed under contract 935,138 841,043 

Other 1,450 (21,087) 

2,077,666 1,835,923 



Increase in fair value adjustment 83,946,740 21,437,034 


121,859,208 40,768,831 



Net Assets Available for Benefits, ending $1,013,752,735 $844,956,804




OPERATING ENGINEERS' BENEFITS PLAN 


For the Year Ended December 31, 2011 2012 and 20102011 



Cooperative housing income 176,094 176,094 


% 2011 % 2010 

──────────────────────────────────────────────────────────────────────────── 

Investments managed under contract 52,871,856 33,949,120 

Receipts: Other 267,742 148,926 

Real Contributions estate income 100.0 5,437,390 $15,442,0095,384,133 100.0 $13,377,710 

──────────────────────────────────────────────────────────────────────────── 

Members' Benefits: 

Accidental death and dismemberment insurance 

94,232,659 68,167,459 

0.4 69,261 1.0 102,697 

Decrease Dental in Book Value of Assets: 

26.7 4,119,029 28.5 3,806,031 

Benefit Extended Payments health - and member family assistance 28.3 4,371,759 31.2 4,183,100 

Cash Life insurance terminations 

Death Long-term disability 

Pension Medical premiums 

7.34,774,039 1,127,9004,586,192 8.7 

0.9 228,634 136,154 918,704 1.0 

32.4 40,215,596 5,000,67838,874,013 35.1 

1,159,275 

128,733 

4,701,430 

Weekly disability 4.3 666,838 4.8 642,568 

──────────────────────────────────────────────────────────────────────────── 

45,218,269 44,378,909 

Expenses- 

100.3 15,491,620 110.1 14,723,834 

Decrease in reserve for members' 


Investments 

future benefits 

managed under contract 

24.3 

935,138 

3,745,631 

841,043 

(4.6) (613,178) 

──────────────────────────────────────────────────────────────────────────── 

Other 1,450 (21,087) 

124.6 19,237,251 105.5 14,110,657 

──────────────────────────────────────────────────────────────────────────── 

2,077,666 1,835,923 

Gross funds available (24.6) (3,795,242) (5.5) (732,947) 

Increase Administrative in book value expenses of assets 6.3 46,936,724 980,032 21,952,627 6.3 837,022 

──────────────────────────────────────────────────────────────────────────── 

Assigned Deficiency and fair of receipts value adjustment over disbursements 

Increase before in investment fair value adjustment receipts (30.9) 83,946,740 (4,775,274) 21,437,034 (11.7) (1,569,969) 

Increase Investment in assigned income value adjustment 13.2 37,912,468 2,031,87019,331,797 13.9 1,854,811 

──────────────────────────────────────────────────────────────────────────── 

Excess of receipts over disbursements (17.8) 121,859,208 (2,743,404) 40,768,831 2.1 284,842 

Reserve for present and future benefits, beginning 16,111,817 15,826,975 

Increase ──────────────────────────────────────────────────────────────────────────── 

in Net Assets available for benefits 168,795,931 62,721,458 

Net Reserve Assets Available for present for Benefits, and future beginning benefits, ending 844,956,804 $ 13,368,413 782,235,346 $16,111,817 

════════════════════════════════════════════════════════════════════════════ 




These 

notes 

summarized 

thereto, are 

financial 

available 

statements 

upon 

are 

request 

not complete 

from the 

and 

Operating 

do not contain 

Engineers 

all of the 

Local 

disclosures 

115 Benefits Plan 









OPERATING ENGINEERS' BENEFITS PLAN 

Statement of Administrative Expenses 

For the Years Ended December 31, 20112012 and 2010 


2011 


2011 2010 

Cooperative housing income 176,094 176,094 

──────────────────────────────────────────────────────────────────────────── 


Actuarial Investments managed under contract 52,871,856 $ 85,822 33,949,120 $ 16,370 

Bank charges Other 267,742 1,500 148,926 1,500 

Miscellaneous Real estate income 5,437,390 7781 5,384,133 7,200 

Professional fees 53,120 40,162 

Legal fees 

Management fees 

94,232,659 68,167,459 4,032 

828,000 

0 

772,000 

Other Decrease in Book Value of Assets: 

(223) (210) 

──────────────────────────────────────────────────────────────────────────── 


Totals Cash terminations 4,774,039 $ 980,032 4,586,192 $ 837,022 

════════════════════════════════════════════════════════════════════════════ 

Death 228,634 918,704 

Pension 40,215,596 38,874,013 


required under Canadian general accounting principles. A complete 45,218,269 set of financial 44,378,909 statements, and 

notes Expenses- thereto, are available upon request from the Operating Engineers Local 115 Benefits Plan 



Investments managed under contract 935,138 841,043 

Other 1,450 (21,087) 






2,077,666 1,835,923 



Increase in fair value adjustment 83,946,740 21,437,034 


121,859,208 40,768,831 



Net Assets Available for Benefits, ending $1,013,752,735 $844,956,804

Local Union Offices 

District 1 and Main Office 

4333 Ledger Ave., Burnaby, B.C. V5G 3T3 

Phone: 604-291-8831 Toll Free: 1-888-486-3115 

Fax: 604-473-5235 

E-mail: iuoe@iuoe115.com 

Business Manager: Brian Cochrane 

President: Wayne Mills 

Mgr. Administration & Special Projects: Lynda Arland 

Office Manager: Arlene Lindsay 

Member Representatives 

Frank Carr Brett Chapman Everett Cummings 

Chip Dhaliwal Bob Higgs Craig McIntosh 

Stewart Miller Don Swerdan 

Dispatcher Jim Flynn 604-473-5231 

Organizing Representative 

Rob Duff 604-473-5206 

Benefits and Pension Plans 

Shawn Hatch, Administrator 

Direct line: 604-299-8341 Fax: 604-473-5236 

Training Association 

Brad Randall, Administrator 

Direct line: 604-299-7764 E-mail: oetp@iuoe115.com 

District 2 

Vancouver Island: 

Tim Cullen and Curtis Harold, Member Representatives 

35 Wharf Street, Nanaimo, B.C. V9R 2X3 

Mailing Address: PO Box 213 Stn A, Nanaimo, B.C. V9R 5K9 

Phone: 250-754-4022 Fax: 250-754-5513 

District 3 

Kamloops-Revelstoke-Okanagan: 

Brad Gerow & Rob de Pfyffer, Member Representatives 

785 Tranquille Road 

Kamloops, B.C. V2B 3J3 

Phone: 250-554-2278 Fax: 250-554-1766 

District 4 

Central Interior-Yellowhead: 

Herb Conat & Wayne Kemp, Member Representatives 

#115 - 513 Ahbau Street 

Prince George, B.C. V2M 3R8 

Phone: 250-563-3669 Fax: 250-563-3603 

District 5 

Peace River and Yukon Territory: 

Mike Spiruda, Member Representative & Organizer 

Site 20, Comp 19 SS2 

Fort St. John, B.C. V1J 4M7 

Phone: 250-787-9594 Fax: 250-787-9491 

Tumbler Ridge Mining Office 

220 Main Street, Tumbler Ridge, B.C. V0C 2W0 

Phone: 250-242-3888 Fax: 250-242-3881 

District 6 

East and West Kootenays: 

Brian Lefebvre, Rob Foskett, Gordon Chaisson Member Representatives 

#102 - 105 9th Avenue S. 

Cranbrook, B.C. V1C 2M1 

Phone: 250-426-4562 Fax: 250-426-6882 

103 Centennial Square,Sparwood, B.C V0B 2G0 

Mailing Address: PO Box 1567, Sparwood, B.C. V0B 2G0 

Phone: 250-425-2161 Fax: 250-425-2166 

Member Information 

Meeting Notices for 2013 

DISTRICT 1 

BURNABY—1st Thursday of every month 

EXCEPT: March & September (because of general 

membership meetings) 

7:30 p.m. at 4333 Ledger Ave., Burnaby 

DISTRICT 2 

Monthly meeting locations alternate: 

NANAIMO— 2nd Monday of odd months, 6:00 p.m. 

at the Coast Bastion Inn, 11 Bastion St. 

VICTORIA—2nd Wednesday of even months, 7:30 p.m. 

at the Pro Pat Legion Branch 31, #292—411 Gorge Rd. E. 

DISTRICT 3 


KAMLOOPS—2nd Thursday of even months 

7:30 p.m. at the Union Hall, 785 Tranquille Rd. 

KELOWNA—2nd Tuesday of odd months 

7 p.m. at the Teamsters Hall, 185 Froelich Rd. 

DISTRICT 4 

PRINCE GEORGE—2nd Wednesday of each month, 

8 p.m. at the Days Inn, 600 Quebec St. 

PRINCE RUPERT, TERRACE, KITIMAT, SMITHERS 

—Members will be advised of meeting dates. 

DISTRICT 5 


FORT ST. JOHN—2nd Tuesday of odd months, 

7:30 p.m. at the Masonic Hall, 10441 100th Ave. 

DAWSON CREEK—2nd Tuesday of even months, 

7:30 p.m. at the Carpenters Hall, 900 118th Ave. 

TUMBLER RIDGE/PEACE RIVER COAL— 

Date, time and place will be posted. 

WHITEHORSE—Members will be advised of 

meeting dates and times. Teamsters Hall, 407 Black St. 

DISTRICT 6 


CASTLEGAR—1st Wednesday of odd months 

7 p.m. at the Super 8 Inn, 651 18th St. 

CRANBROOK—1st Tuesday of even months 

7 p.m. at the Labour Centre (Boardroom), 

105 9th Ave. South 

ELK VALLEY COAL CORP.—Line Creek Mine— 

Date, place and time as posted. 


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OE News Special Edition July 2013

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