Gary

The outcome of Arizona v Norris resulted in the requirement of using the same mortality tables for males and females for determining act equiv. benefits. Is there a section in Code that requires use of same mort. table or is this requirement just based on Civil Rights established from the case?

A Plan doc has Gatt assumptions for lump sums, but the most up to date SPD has PBGC basis. How likely of a case does an employee have in this case and does anyone know any precedents out there? The ee wants PBGC basis as it results in greater lump sum.

The 83 GAM is used for GATT purposes and is considered a current mortality table. Does anyone know how to explain to a client why this table is considered current if it has the year 1983?

This is not something I have had to work with at a practical level. One good reference that might get you moving in the right direction is to start with the Defined Benefit Answer Book.

Thanks Larry I'll check into that, Gary

I don't necessarily want to know every detail. Ideally I would simply want the main acts of legislature that shaped our pension plan design evolution. For eg. as a reference I would like to have the significant Acts as a resource in my library. Perhaps starting w/ enactment of ERISA (or anything else of importance prior to ERISA) and moving ahead to the more substantial Acts (over past 25 years since ERISA), like TRA '86, REA, GATT. Something like that. Gary

As a follow up w/r/t ADEA. ADEA mentions applicability to emplyers of DB Plans. So I presume it is safe to say that employers and plan sponsors includes State Ret Systems. i.e. they fall under the rules associated w/ ADEA. That being the case. Section 4 of ADEA covers accruals after NRA. And it appears to me that ADEA also includes the rules in 411 pertaining to suspended benefits at NRA and required actuarial increases in addition to not being allowed to cease accruals on account of age. So if my interpretationof ADEA Section 4 is accurate, then gov plans would be required to furnish suspension of benefits notices and would be required to provide greater of accd ben or act increased ben. I doubt gov plans are doing this. Any comments or thoughts w/r/t these allegations. I would be happy to forward the particular secion of ADEA if anyone is interested.

I am at a point where I feel I need to not only learn current pension law, but also know the history and evolution of US pensions. First, I need to be aware of all the Acts and legislation that has been passed over the years. Then I need to know the highlights of what changes to pension laws resulted from each Act or legislation. Then I need to decide which Acts, etc. I need to get a copy of and how or where I could obtain them. For eg. a summary of all Acts could look something like this (just for sample purposes only): ERISA 1974 TEFRA 1982 DEFRA 1983 REA 1984 TRA '86 You get the picture. My question is how would you suggest I go about this endeavor? Thanks much. Gary

A Plan has a SS offset formula. Normal Ret is age 65. The offset is up to 45% of PIA. If a person has a SSRA of 66 and retires at age 65 should the Plan use the PIA at age 66 and then reduce it by 1/15 for commencement at age 65 when determining the offset portion? It doesn't seem right to use the PIA unreduced. It seems it s/ use the SS Ben at the ben commencement date of 65. Any thoughts? Plan says that it is just the unreduced PIA, but I tend to disagree. Gary.

Does anyone know if the 411 post normal ret age accruals apply to State Plans? i.e. for a teachers plan? I thought there may be something in ADEA that might require a gov plan to apply 411 post NRA accruals. This has to do w/ receiving the greater of AB or age 65 act increased AB. Gary

A Plan has a formula equal to: 1.5% * svc (limited to 40 years) * avg pay less 66 2/3% of Soc Sec Ben. The offset in its current version does not seem to be a fixed formula or a unit credit formula. It would appear that the 66 2/3% would either have to be prorated for service under 40 or would have to accrue at say 1 2/3% per year for a max of 40 years/ What do you think? Is there an omission in the formula? Is it illegal since it doesn't explicitly include one of the above?

It would also seem to me to be a good idea to look at the plan provisions w/r/t deferred retirement. Maybe it provides for actuarial increases for commencement after age 65.

Pax, I think you got my point. The lump sum was paid out in April 1999. You hit on my real question. That being what mortality table to use. So if a plan says "factors published by the PBGC ..." it not only applies to a set of interest rates, but it also applies to a mortality table, namely the UP 84 Table (Table 3 in ERISA 4044)? And (playing devil's advocate) why couldn't it be the Table 1 in the Appendix to ERISA 4044 (which uses the 83 GAM table)? Gary

A Plan says that for payment of a lump sum the lump sum shall be determined as follows: Section 5.1 "The equivalent lump sum value of an annuity shall be determined by applying the factors published by the PBGC for distributions in the calendar month preceding the Ret. date." Section 1.2 The Plan def. of Act. Equiv. is 8% and 83GAM table. A person retires on 5/1/99. What assumptions (w/r/t interest and mortality) would you use to value the lump sum? Gary

Does anyone know if the 411 post normal ret age accruals apply to State Plans? i.e. for a teachers plan? I thought there may be something in ADEA that might require a gov plan to apply 411 post NRA accruals. This has to do w/ receiving the greater of AB or age 65 act increased AB. Gary

Does anyone know if the 411 post normal ret age accruals apply to State Plans? i.e. for a teachers plan? I thought there may be something in ADEA that might require a gov plan to apply 411 post NRA accruals. Gary

A Plan requires that a lump sum be computed as the sum of 50% of the value using PBGC male mortality and 50% of value using PBGC female mortality. What is 50% PBGC male mortality? ERISA 4044 has two tables. Table I is mortality for healthy males (same Table I w/ 6 yr set back is female table). And Table 3 is entitled "lump sum mortality table*, which may be a table that blends male and female rates from some mortality table. If my memory is correct, Table I is the GAM 71 male and female tables. And Table 3 may be related to the UP84 Table. Like to know your thoughts. Gary

Kathy, It sounds unlikely. We would need to get Plan documents at the time of your father's death and review them. And we would have to, if necessary research the law in effect at that time to see if there is any recourse. If you care to discuss in greater detail you can contact me at mevoco@mindspring.com. My website is http://www.mindspring.com/~mevoco. Good luck. Gary

Keith I agree with your response # 2, or at least the logic behind it. On what grounds can you support # 2? I think the 411 regs can lead us to the conclusion you make in #2, but do you find it to explicitly handle that situation or any other reg explicitly support that? Although, I do come to the same conclusion as your # 2 also.

Yes pax but isn't it true when act increasing a ben after age 65, you do this at the end of each plan year and then again at actual ret? The only difference in my eg. is that I am considering doing it again at the time of amendment. Keith N addresses this issue to an extent in one of his earlier responses (you may want to look at his repsonse too).

I agree with your comments. I am looking at it from participant's perspective and playing devil's advocate. So my question really is, could it be MUCH of a case to argue that a 95/5 table is unreasonable (regardless of what plan has done) since it is not specified. Plan says the actuary determined it to be 95/5 based on employee population.

A plan states that act equiv uses mortality based on the 71GAM table (unisex blend). It does not say what percent the unisex blend is based on the male table or the female table. What blend is reasonable to assume in this case? That is since it is not specified can one take the approach that it be a 50% male and 50% female? The Plan violates 401(a)(25)(definitely determinable benefits). So any suggestions as to the extent that the Plan's percentage blend could be challenged on that basis? Gary

Getting more specific. Say a person reaches age 65 on 1/1/95 and say he retires on 7/1/99. Let's assume that the actuarial increase as of 1/1/99 is greater than the actual accrued benefit. Say the benefit formula is increased from $ 25 per month for each year of service to $ 30 per month as of 4/1/99. It turns out that the AB at 7/1/99 applying the new formula is larger than the 1/1/99 AB act. increased until 7/1/99. However, if I compute the AB at 4/1/99 at the time of the amendment then act. increase that 4/1/99 AB until 7/1/99, it is greater than the 7/1/99 AB. Is that a reasonable way of determining the AB after age 65 or can we only do it as stated at first in this question? Gary

Don't know that it has received a determination letter. I would be surprised if they didn't.

It's a qualified plan. A railroad company (Assuming they are qualified). The SPD has same provision as in Plan. And this is only calc. I have. This calc has a gross age 62 pension of $300 per month based on 6 yrs CS and FAP of 40k (all approximations). The offset is based on a SSRA PIA of 994, reduced for commencement at age 62, which comes out to approx 700 per month and then mult. by 2/3 and it produces a benefit less than zero. Seems to fail 411(B), and I am wondering if it is an illegal offset prior to 1/1/89 and certainly doesn't appear to meet post 1/1/89 offset rules. Any comments?