Lines drawn on pension reversions but compromise possible.

When the A&P grocery chain was taken over in a 1982 leveraged buyout, the acquirer, Germany's Tengelmann Group, terminated A&P's pension plan and used the $270-million surplus to help finance the takeover.

In the '80s, pension fund surpluses helped to finance two-thirds of the largest buyouts, says the Labor Secretary Robert Reich, who is leading the charge against a House plan that would make it significantly easier for companies to cash out their pension surpluses. Passage of the bill would endanger the retirement security of millions of workers, he charges.

Treasury managers generally support the proposal, saying that corporations should have greater access to that money as long as they can still meet their pension obligations. Such flexibility, they say, would allow them to manage their assets more efficiently, using the surplus to pay down debt, begin new capital projects or start new pension plans.

"The money belongs to us so long as can we can meet our obligations," says Buell T. Adams, vice president and treasury manager for CBI Industries in Oak Brook, IL. "This would give us more freedom."

Under current law, companies can only divert surplus pension assets to buying health insurance for retirees without paying a 50% excise …