Headlines about "Ret plans - cash balance, hybrid"

Gathered from the web by the editors at BenefitsLink.com.
[Opinion] PBGC: Protector or Predator?
"[The three Dewey & LeBoeuf] plans PBGC has taken over are all cash balance plans that cover only past and current partners and they are relatively well funded.... What's the PBGC doing taking over a plan for partners-only, one of which is reported to be over-funded? Is this agency, strapped for cash itself, looking to prey on these lawyers by appropriating the approximately $150 million in assets in the plans and having to pay out substantially less (based on PBGC calculations) in monthly installments at later dates?" (Burypensions Blog)

Defined Benefit Fans Tout Cash Balance Pension Plans for Public Employees
"Across the country, the pension reform debates have spurred a lot of talk about how to fix the mess created by runaway defined benefits plans that promised more than they could deliver. So it's no wonder that pension skeptics are suspicious about the latest scheme to emerge from traditional pension advocates, notably the labor groups and many in the actuarial community, who have proposed 'cash balance' plans as the new panacea.... For those unfamiliar with cash balance plans, they are sometimes known as 'defined-benefit plans in drag.'" (Governing)

Final IRS Regs on Cash Balance Plans to be 'Meaningfully' Altered from 2010 Proposal (PDF)
"The Treasury Department will soon release final rules on cash balance and pension equity plans that will be significantly different from the proposed rules.... [IRS official Mark Iwry] said the Obama administration is open to creating hybrid plans that mix characteristics and features of defined benefit plans and defined contribution plans in innovative ways. For example ... collective investments and professional investment management could be used in plans that have characteristics of defined contribution plans. Similarly, defined contribution plan investing could be done with institutional shares, not retail shares[.]" (Bloomberg BNA)

[Opinion] American Benefits Council Comment Letter to IRS on Priority Guidance Plan (PDF)
"The Council is writing to recommend items relating to employee benefit matters that should be included on the [IRS] 2012-2013 Guidance Priority List. The Council is submitting a letter separately recommending a project to modify the current nondiscrimination and minimum participation regulations to protect older, long-service participants. This letter focuses on other recommendations for the Guidance Priority List." (American Benefits Council)

[Opinion] Louisiana Pension Reform Opponents Proffer Misleading Arguments
"Critics of Governor Jindal's proposed 'cash balance' pension plan for state employees have made a number of inaccurate claims. The current retirement systems have amassed an astonishing $18.9 billion in unfunded liabilities, but reform opponents defend the status quo with scare tactics while relying on a flawed report from the Legislative Auditor. These critics claim that switching from the current defined benefit plan to a cash balance plan would increase costs to the state, drive up taxes, and even force people into poverty. In fact, this reform would put Louisiana's retirement systems on a more sustainable path, protecting state employees and taxpayers alike." (The Pelican Post)

Creating a Hybrid DC Retirement Plan (PDF)
"The authors believe that recently issued retirement plan regulations have given employers an option that captures the best of DB and DC plans and represents a win-win for employers and employees. The authors call this type of plan the Low Volatility Pension Plan (LVP)." (Buck Consultants)

Virginia to Switch to Hybrid Retirement Plan for New Employees; All Employee Contributions to Rise
"VRS will launch a mandatory hybrid plan for new employees by Jan. 1, 2014, according to the legislation. The hybrid will have defined benefit and defined contribution components; the total employee contribution for both will be 5% of pay. Beginning July 1, the start of Virginia's fiscal year, school and local employees for the first time will be contributing to their pension plans. The hike in employee contributions will be offset by salary increases." (Pensions & Investments)

Louisiana Weighs Deeper Pension Cuts
"[Governor Bobby Jindal's] proposal, which excludes school and law enforcement employees, is aimed at about 40,000 members of the Louisiana State Employee's Retirement System, which opposes much of what [he] wants to do. System officials stress that they support a cash balance plan in concept but not as offered by the governor. For one thing, they said, [he] proposes new hires could retire at 60 with full benefits but the age for current employees would be 67." (Stateline)

[Guidance Overview] Eighth Circuit Court of Appeals Affirms Summary Judgment in Favor of Plan Sponsor in ADEA Case Challenging Target Benefit Plan
In Northwest Airlines, Inc. v. Phillips, the 8th Circuit has rejected a claim of age discrimination by a group of older airline pilots, who challenged the formula used in a target benefit plan created as part of the airline"s bankruptcy proceeding in which benefits under the airline's defined benefit plan were frozen. (Justia.com)

Re-Imagining Pensions: Using Innovative Pension Plan Design to Reduce Risk and Increase Retirement Income
Includes links to videos of all presentations. "Covington & Burling, the Pension Rights Center, and the Urban Institute sponsored a conference on February 22, 2012, to discuss new pension plan designs to improve retirement security [which featured] three panel discussions ...: risk-sharing, coverage and adequacy, and annuitization. Panelists included Phyllis Borzi of the Labor Department, Mark Iwry of the Treasury Department, Josh Gotbaum of the PBGC, and experts from government, the business community, labor groups, academia, and advocacy organizations." (Pension Rights Center)

Kansas House OKs Cash Balance Plan for State Workers
"The Kansas House passed a bill Tuesday that would close the $13 billion Kansas Public Employees Retirement System to new state employees.... Under the bill, employees hired on or after Jan. 1, 2014, would receive a one-time choice of being enrolled in a new cash balance plan or a new defined contribution plan." (Pensions & Investments)

Enrolled Actuaries Report, Winter 2011 (PDF)
This edition includes the following: GASB Unveils Preliminary Viewson Financial Projections; Research Projects Private Pension Funding Costs; Updated Social Security and IRS Amounts for 2012; Is 411(d)(6) Dead? Recent Developments for Hybrid Plans; and, PBGC Clarifies Instructions for Form 5500 on the reporting of premium payments. (Enrolled Actuaries Report)

[Opinion] Cash-Balance Plan Design Had Promise
"Bank of America certainly is not the first employer to freeze a cash balance plan or, for that matter, other defined benefit plans. But as it was such an enthusiastic pioneer of the plan, I couldn't help but think: Is there really much of a future for defined benefit plans?" (Business Insurance; free registration required)

Ensure your Plan Participants are Prepared for a Secure Retirement
Defined Contribution Conference, March 11-13, in Miami. Learn from your peers through presentations and discussions on plan design, communications, investment options and more. FREE registration for qualified plan sponsors. (Pensions & Investments)

Avoid the Common Mistakes Affecting Plan Loans Webcast
Earn CE credit while ERISA expert, Charles Lockwood, JD, LLM, explains the administrative issues that affect plan loans. Have questions? Charles will address them either during or after the webcast. March 22nd at 2pm EST. (ASC)

CalPERS' Actuarial Cost Analysis of Proposal for the Creation of a Hybrid Plan for New Hires (PDF)
The analysis outlines costs for creating a hybrid plan consistent with Gov. Brown's pension reforms. (CalPERS)

IRS Semiannual Regulatory Agenda Includes Additional Guidance on Funding Rules, Hybrid Plans
"The items in the IRS's final rule stage include the following: Definition of 'highly compensated employees.' Regulations providing guidance on the application of the accrual rules for defined benefit plans in cases where plan benefits are determined on the basis of the greater of two or more separate formulas. Additional guidance regarding the rules for hybrid plans that were added by the Pension Protection Act of 2006. Regulations providing relief from the 3% mandatory nonelective contribution requirement in safe harbor 401(k) plans." (Wolters Kluwer Law & Business / CCH)

[Guidance Overview] Top 10 ERISA Developments of 2011
"In sum, 2011 altered the legal landscape for plan sponsors, plan fiduciaries, third-party administrators, service providers, and plan participants. Although the precise consequences of the top ERISA developments of 2011 remain to be seen, they are certain to present new risks and challenges in 2012 and beyond." (Jenner & Block)

PBGC Semiannual Regulatory Agenda Addresses Cash Balance Plans, Missing Participants, Rollovers, Airline Plans
"The Pension Benefit Guaranty Corporation . . . has released its semiannual regulatory agenda for Fall 2011, which outlines regulations that have been selected for amendment during the next year." (Wolters Kluwer Law & Business / CCH)

Louisiana Governor Proposes Pension Overhaul
"[T]he governor unveiled a detailed plan he says would both ease taxpayer burden and ensure that workers will receive promised benefits . . . . Jindal said the state's unfunded accrued liability has tripled to $18.5 billion over the past two decades, three times the current total payroll. For new hires, Jindal proposed a switch from a defined benefit plan to a cash-balance plan." (PLANSPONSOR.COM)

State Defined Contribution and Hybrid Retirement Plans
"This report lists state governments' defined contribution retirement plans designed as primary coverage for a group or class of state employees or state teachers: that is, it includes plans that eligible employees are required to join, or that are one of two or three alternative plans that employees choose among. Some states provide hybrid plans, in which employees are covered by both a defined benefit and a defined contribution plan. Hybrid is a generic, not a specific, term, and what are called hybrid plans in state government differ substantially." (National Conference of State Legislatures)

[Opinion] Explaining Plan Changes: Lessons from the Supreme Court in CIGNA v. Amara (PDF)
The lessons go beyond cash balance plan conversions and may apply to changes plan sponsors make in reaction to the health reform law. (Employee Relations Law Journal via Steptoe & Johnson LLP)

[Opinion] ASPPA/ACOPA Comments on Proposed Rule Relating to Benefit Determinations and Plan Valuations for Statutory Hybrid Plans
"ASPPA and ACOPA recommend that proposed regulations regarding ?4022 be temporary, effective only for plan terminations occurring before the effective date of final Treasury regulations regarding market rate of return. PBGC should re-propose these rules in a manner that is consistent with the final Treasury regulations after the final market rate of return regulations are issued." (American Society of Pension Professionals & Actuaries/ASPPA College of Pension Actuaries)

How to Determine If a Cash Balance Pension Plan Is Right for Your Company
"'If they have not maxed out their 401(k) plan, we recommend that they do so prior to establishing the cash balance pension plan. In combination, these two plans can enable the organization to cost effectively meet a variety of goals relative to the principles of the practice.'" (Smart Business Network Inc.)

Enrolled Actuaries Report, Winter 2011 (PDF)
Articles include: Research Projects Private Pension Funding Costs; Is 411(d)(6) Dead? and, Recent Developments for Hybrid Plans. (American Academy of Actuaries)

[Guidance Overview] PBGC's Proposed Regs on Benefit Determinations for Terminating Statutory Hybrid Plans (PDF)
"The PBGC proposed regulations provide certainty for terminating statutory hybrid plans and allow these plans to coordinate their calculations with those the PBGC will use." (Buck Consultants, LLC)

[Guidance Overview] Longer Wearaway Periods for Older Workers in Pre-PPA Cash Balance Plan Did Not Violate ADEA
"The ADEA is satisfied as long as an employer treats older and younger workers equally with respect to credits to their cash balance accounts, even if such treatment results in longer wearaways for older workers. In other words, to demonstrate age discrimination, workers must show that plan inputs --in this case, the pay and interest credits --are discriminatory, rather than pointing to disparate outputs such as the longer wearaway period." (Wolters Kluwer Law & Business / CCH)

Cash Balance Plan -- Technically a Defined Benefit System, but Looks and Feels Like a 401(k)
"The plans get special treatment from the Internal Revenue Service. Participants who are aged 50 or more can make a six-figure maximum contribution, far more than what's allowable to a 401(k)." (Sun-Times Media, LLC via International Foundation of Employee Benefit Plans)

State Hybrid Retirement Plans (PDF)
"This brief examines two types of hybrid plans in use in the public sector. The first is a cash balance plan, which marries elements of traditional pensions and individual accounts into a single plan . . . . The second combines a smaller traditional defined benefit (DB) pension with an individual defined contribution (DC) retirement savings account, referred to in this brief as a 'DB+DC plan' . . . ." (National Association of State Retirement Administrators)

SunTrust Banks Freezes Pension Plan and Enhances 401(k) Plan
"Participants in SunTrust's cash balance plan, which the Atlanta-based bank set up in 2008, will stop earning pay-related credits after Dec. 31 . . . . In addition, benefit accruals for long-service employees who opted to remain in SunTrust's traditional final average pay plan at the time of the cash balance plan conversion also will stop at end of this year." (Business Insurance)

[Guidance Overview] Stovepipe Model in Target Benefit Plan Did Not Violate ERISA or ADEA
"If your company has undergone dramatic changes, a target benefit plan may be an appropriate means of integrating prior benefit arrangements and providing a benefit that satisfies reasonable benefit expectations and goals of the company and employees. Courts [such as a recent decision from the Eighth Circuit] recognize that retirement plans do not need to be age neutral or age-blind in order to avoid running afoul of the ADEA. Plan designs can employ age and age-affected elements so long as they are not animated by an intent to discriminate because of age." (Littler)

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