USMX Animated PDFs

38 2 0 1 7 A N N U A L R E P O R T ABOUT THE CONTAINER ROYALTY 5 FUND Effective with the Master Contract extension agreement that covered Contract Years 2009 through 2012, CR5 was instituted to address the downturn in the econ- omy that dramatically affected the ability of the local ILA welfare funds to meet their obligations under the Master Contract. CR5 also replaced the automatic pay- ments that were made to the ports under the previous Master Contract's Container Royalty CAP Program. CR5 allows the industry to be able to direct funds as needed to those local welfare funds that demonstrate a shortfall in funding based on a pre-approved list of criteria. Like the various other Master Contract Trust Funds, the CR5 Fund is financed through a carrier as- sessment, and is jointly administered by Trustees from the ILA and USMX. CONTAINER ROYALTY 5 (CR5) TRUST FUND 2017 UPDATE: The CR5 Fund is an essential resource for our member ports whose local benefit funds experience a shortfall and are unable to meet their Master Contract obligations. The demand for CR5 funds has varied over the years due to increases in Vacation and Holiday benefits that are driv- en by wage increases and the wage progression offset by improved (due to volume increases and/or financial improvements) local benefit funds. A key criterion to CR5 restricts the application amount to be used for funding Pension funds or to fund an increase in local benefits of any kind. Concern over adequate funding remains, due to the difficulty in forecasting future demands. In the Contract Year that ended September 30, 2017, CR5 paid out approximately $35 million dollars in assistance applied for by our member ports, in addition to the automatic payments made as required under the Master Contract. 2017 saw a significant increase in tonnage across all ports, which provided additional funding for local benefits. Due to this improvement, the demand of CR5 should continue to decrease if funds are properly allocated. The CR5 trustees remain vigilant in adhering to the criterion of the trust to ensure funds are awarded to only the ports that experience a true shortfall. USMX-ILA TRUST FUNDS OVERVIEW

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