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Ret plans - policy

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[Opinion] Inspiring Trip to Columbus Brings Hope for Multiemployer Solution
"[H]undreds of activists headed to the Joint Select Committee on the Solvency of Multiemployer Pension Plans' hearing ... The hearing was held in Ohio because thousands of workers and retirees in the state would be devastated by reduced pensions, and hundreds of employers could be forced into bankruptcy." (Pension Rights Center)
Legislation Introduced to Boost SIMPLE Plans for Small Businesses
"The SIMPLE Plan Modernization Act, introduced July 13 by Sens. Susan Collins (R-ME) and Mark Warner (D-VA) would increase the contribution limit for SIMPLE plans. The bill's sponsors say that increasing the limit would achieve two basic goals: encourage more small business employers to offer a retirement savings benefit to their employees; and allow small business employees to save even more each year on a tax-deferred basis." (National Association of Plan Advisors [NAPA])
New Illinois Program to Offer Retirement Savings Plan
"A new state program will automatically deduct money from the paychecks of about 1.2 million Illinois residents for retirement savings.... The state-sponsored retirement program works with certain businesses with 25 or more employees. The businesses will be connected with a financial firm that will provide ways for workers to build retirement savings with after-tax cash deducted from each paycheck for a Roth individual retirement account." (The Olympian)
ERISA Advisory Council to Meet August 14-16
"[T]he 192nd meeting of the Advisory Council on Employee Welfare and Pension Benefit Plans (also known as the ERISA Advisory Council) will be held on August 14-16, 2018.... The purpose of the open meeting is for Advisory Council members to hear testimony from invited witnesses and to receive an update from [EBSA]. The EBSA update is scheduled for the morning of August 16, subject to change." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
Thousands of Workers and Retirees Head to Ohio July 12 to Protest Pension Cuts and Pressure Congress to Act
"The rally is being organized to coincide with a field hearing that will be convened in Columbus on Friday, July 13th by members of the Joint Select Committee on the Solvency of Multiemployer Plans. The Joint Select Committee, created by Congress in a bi-partisan budget deal last February, is charged with developing a consensus solution to the multiemployer pension crisis affecting families across America." (Pension Rights Center)
[Opinion] Multiemployer Pension Alliance Letter to Joint Select Committee on the Solvency of Multiemployer Pensions (PDF)
"A well-designed loan program can save the most troubled plans and the PBGC's insurance program.... Interest rate assumption rules did not cause the solvency crisis facing troubled plans and are not an appropriate 'lever' to avoid future crises.... Sound multiemployer plans cannot pay for the administration's PBGC premium proposal without sustaining substantial harm.... PBGC premium increases do not -- and are not intended to -- address the solvency crisis facing troubled plans." (Multiemployer Pension Alliance)
[Opinion] Plan Sponsors Should Protect 401(k) Participant Loans from Default
"The problem is not loans per se, the real risk is when loans default. Yet many plan sponsors remain unaware of the size and scope of loan defaults each year (over $6 billion a year and counting) or, even more worrisome, their fiduciary obligation to address them.... Some plan sponsors are beginning to experiment with post-separation repayments, but so far employees without a job aren't rushing to sign up." (Employee Benefit Adviser)
[Opinion] What Is PEPTA and How Would It Impact Public Pensions?
"PEPTA would require state and local public pension plans to disclose their unfunded liabilities to the U.S. Department of the Treasury, but it would require them to calculate their liabilities using the rate of return on U.S. Treasury bonds. This would artificially inflate the unfunded liabilities to much higher levels than what the plans actually face.... The federal government has very little oversight of state and local pension plans.... These plans do report plenty of relevant information to the stakeholders in their states." (National Public Pension Coalition)
[Opinion] Yesterday's 401(k) Is Not the Same as Tomorrow's 401(k)
"[T]here is no solution for workers who do not have retirement preparation as a priority. There is no retirement preparation solution for those who suffer repeated employment, financial, medical or other setbacks throughout their working careers.... [T]he 401(k)'s past is not its future [and] most of the academic and media criticism of individual account retirement savings plans is based on what retirement professionals see in their rear view mirror." (Plan Sponsor Council of America [PSCA])
[Opinion] American Academy of Actuaries Letter to Congress Suggesting Improvements to the Proposed 'Lifetime Income Disclosure Act' (PDF)
"[S]hould Congress take up the Lifetime Income Disclosure Act (S.868, H.R.2055), it could be improved in the following ways: [1] Provide more guidance to the [DOL] with respect to the lifetime income disclosure provisions ... [2] Exempt small employers from providing the income disclosure statement; however, require that they furnish employees with information regarding the DOL website tool and how to access it ... [3] Require that the DOL update its website to align with the legislation.... [4] Direct the DOL to create a better safe harbor that would relieve employers from fiduciary liability for providing retiree income options." (American Academy of Actuaries)
One Year In, Assessing the Progress of OregonSaves
"In a broad statement marking the first anniversary of the OregonSaves program, State Treasurer Tobias Read suggests the pace of signups is advancing, with an average of more than a thousand people now being registered a week to start contributing." (PLANSPONSOR)
Is It Time to Address Benefits for Alternative Work Arrangements?
"[T]he percentage of individuals providing services via an alternative work arrangement in the United States rose from 10.7% in February 2005 to 15.9% in late 2015.... 94% of the net job growth in the United States during this time period was attributable to the independent workforce.... As Congress crafts long-term solutions for these issues, it may be that companies that reduced employee benefit costs in the short run via outsourcing and the use of independent workers will have merely traded one set of costs for another." (Thompson Coburn)
Congress Says No Rothification ... for Now
"Congress is looking at round 2 of tax reform, and Rothification has come up again. However, ... Chairman Kevin Brady (R-Texas) said that 'the Ways and Means Committee has no plans to revisit the issue of so-called Rothification as part of any 2.0 proposals, and any rumors to the contrary are simply not correct.' " (Slott Report)
Genstar, Aquiline Mull Sale of Retirement Plan Administrator Ascensus
"Private equity firms have been eager to buy retirement services providers, which are often ripe for technological innovation and poised to benefit from an aging population. The industry is also dense with small players, creating an opportunity to grow through acquisitions." (ThinkAdvisor)
The Multiemployer Pension System: An Analysis of Cohort Equity (PDF)
10 pages. "Cohorts that retired before 2003 will experience, or have already experienced, an average [internal rate of return (IRR)] in excess of 9%. As a result of contribution increases without commensurate benefit increases, a dramatic decline in IRR began in 2003. For a typical plan, the marginal IRR ... declined from over 6% in 2002 to about 2% in 2015.... A plan that avoids insolvency and manages to gradually pay-down its funding deficit could, in the long run, reduce its contributions or raise its benefits, leading to a rebound in the marginal IRR." (The Pension Analytics Group)
[Opinion] It's Time for 401(k) Plans to Become Part of the Sharing Economy
"The better way is through the aggregation of the plans of unrelated 401(k) plan sponsors into single plans called multiple employer plans.... This better way has the following objectives: [1] Reduce the employer's exposure to fiduciary liability as much as possible; [2] Put plan administration burdens entirely on a professional administrator with benefit plan expertise; [3] Keep the expenses of the arrangements at economical levels through the aggregation of the plans of unrelated employers." (Fiduciary Plan Governance, LLC)
Improving Social Security Coverage and Retirement Benefits for Independent Contractors (PDF)
44 pages. "This paper provides a background of the policy mechanism for covering [independent contractors (ICs)] through Social Security, explores the reasons why the system leaves gaps in coverage for ICs, and offers six categories of policy options to improve Social Security coverage and re tirement benefits for these workers." (National Academy of Social Insurance [NASI])
[Opinion] Joint Trade Association Letter to Senators Proposing SCP Expansion Be Included in Senate IRS Reform Proposal (PDF)
"[This] proposal would direct the IRS to expand the self-correction program (SCP) within the IRS's Employee Plan Compliance Resolution System (EPCRS), to enable businesses with retirement plans to more easily correct common mistakes. Expanding SCP to address common mistakes enables businesses to fix these problems without a submission to the IRS and the payment of a user fee. Timely and efficient correction protects participating employees by providing them with their expected retirement benefits, including favorable tax treatment." (American Society of Pension Professionals & Actuaries [ASPPA])
The Battle Over 'Vested Rights' in California
"From the beginning, the California Supreme Court, depending on the factual situation before it, has sent mixed messages.... The basic question comes down to: 'Can a California public agency make reasonable and necessary changes to the future pension benefits of current, active employees without providing something equivalent for anything taken away?' " (Best Best & Krieger LLP)
[Opinion] Joint Association Letter to EBSA Regarding Missing and Unresponsive Participants
"It is critical that regulators coordinate on guidance.... The proper steps that should be taken to deal with missing and unresponsive participants are context dependent.... Some participants and beneficiaries will simply not be found, and plans need workable solutions with respect to their benefit.... More transparency and consistency in audit guidelines would help manage expectations and speed the regional offices' review of plan procedures.... Input and comment from the regulated community is critical." (The ERISA Industry Committee [ERIC], American Benefits Council, and 8 other trade associations)
Are Roths the Future of 401(k)s?
"Under tax reform, most Americans now pay lower marginal rates. But those rates are scheduled to sunset at the end of 2026 ... Intentionally or not, the TCJA has made a Roth savings strategy more valuable than traditional pre-tax contributions for most savers, if the increased tax rate barometer is applied." (ThinkAdvisor)
Supreme Court Declines to Hear Challenge to Time Limits on Fiduciary Breach Waivers
"he Supreme Court on [June 25] declined to hear a challenge by an ESOP plan trustee on whether a time limit for bringing breach of fiduciary duty claims can be waived. The [DOL] had argued for the petition to be denied[.]" (Pensions & Investments)
New Plaintiffs' Firms Bring Increased ERISA Litigation Risks for Employers (PDF)
"Until recently, a small group of specialized plaintiffs' firms has dominated the ERISA class action space, beginning with untested theories of liability that are eventually leveraged into portfolios of lawsuits. Those portfolios (and the plaintiffs' attorneys who created them) have become well-known. But an interesting trend has emerged in the day-to-day ERISA litigation docket: new plaintiffs' firms have begun to enter the space in a significant way. This development, which has significant implications for plan sponsors and fiduciaries, has been picking up significant speed in the last several months." (Jenner & Block, via Employee Relations Law Journal)
Rhode Island Law Will Facilitate Settlements in Lawsuits Over Failed St. Joseph's Pension Fund
"Legislation aimed at smoothing the way for settlements in the multiple class-action suits over the failed St. Joseph's Health Services pension plan has been signed into law by Gov. Gina Raimondo.... A General Assembly press release explained [that] the legislation ... 'provides that defendants entering good faith, judicially-approved settlements would not be liable for claims from co-defendants.... The finality of the settlement without fear of a contribution claim from a co-defendant, provides an incentive to settle.' " (Providence Journal)
Massachusetts Charges MetLife with Fraud Over Filings Related to 13,500 Missing Participants
"[T]he complaint alleges that MetLife's public filings contained material misstatements about company finances, because reserves set aside for missing participants were released and 'became assets which inflated MetLife's bottom line.' ... [In a February 8-K filing with the SEC, MetLife] said about 13,500 participants had been affected over the past 25 years. MetLife said the reserves set aside for those participants were released. Now, the company has added $510 million back to those annuity reserves." (Pensions & Investments)
[Opinion] The State Pension Model Isn't Working
"In theory, state pensions are stand-alone entities that collect contributions, invest them for growth, and then disburse benefits. Very simple. But in many places, all three of those components aren't working. Employers (governments) and/or workers haven't contributed enough. Investment returns have badly lagged the assumed levels. Expenses are more than expected because they were often set too high in the first place, and workers lived longer." (John Mauldin, in Forbes)
Summary of Enrolled Actuaries Meeting Discussion of the Pension Protection Act: Successes, Shortcomings, and Opportunities for Improvement (PDF)
"PPA assaulted pension funding at the worst possible time ... Funding Relief delayed a return to historical funded status standards ... PPA added several administrative requirements creating time consuming computations with little added value and increased exposure to errors and missed deadlines.... Employer defaults to Section 401(k) and IRA-type arrangements as the path of least resistance these past few years is producing massive waives of retirees with little retirement income security." (H. C. Foster and Company)
Current Population Survey: Issues Continue for Retirement Plan Participation and Retiree Income Estimates
"Compared with the 2013 estimate before the questionnaire redesign, the 2016 estimate shows a reduction of 13.5 percentage points in the percentage of full-time, full-year wage and salary workers ages 21-64 participating in a retirement plan ... Since the redesign, the survey has shown ongoing, substantial declines among full-time, full-year wage and salary workers with the highest likelihoods of participating in each of four important demographic groups.... Discrepancy in the participation trend relative to another government survey ... A higher percentage reporting pension income ... Generally, higher overall reported income." (Employee Benefit Research Institute [EBRI])
Rethinking Millennial Retirement: Policy Recommendations for a Gig Economy (PDF)
43 pages. "Millennials face a myriad of challenges in saving for retirement.... In response to the lack of accessibility and portability in retirement plans for workers in the gig economy, an ever-growing sector, we propose the creation of a 'MEP IRA'.... For those who participate in the gig economy and are in or near poverty, a reformed Saver's Credit can help them start to save for retirement.... The last element of our policy proposal is an expansion of financial literacy courses and resources for college students." [This paper is the winner of WISER's 2018 iOme Challenge.] (Evan Avila, in conjunction with Women's Institute for a Secure Retirement [WISER])
Administration Proposal Rolls Out Proposal to Combine DOL and DOE
"The White House unveiled a proposal to combine the Labor and Education departments into a single agency with four subgroups, blending everything from enforcement to workforce development. The June 21 reorganization report calls for the two departments' sprawling assortment of subdivisions to be folded into agencies called K-12; the American Workforce and Higher Education Administration (AWHE); Enforcement; and the Research, Evaluation, and Administration agency. The new Cabinet agency would be called the Department of Education and the Workforce." (Bloomberg BNA)
Five New Members Appointed to 2018 ERISA Advisory Council
"Current members Cynthia Levering and Srinivas Dharam Reddy will serve as the chair and vice chair, respectively, of the council.... The newly appointed members and the expertise they represent are: [1] Employers: David J. Kritz is General Attorney for Norfolk Southern Corporation ... [2] Corporate Trust: Linda M. Kerschner is a Senior Vice President of CAPTRUST Financial Advisors ... [3] General Public: David Blanchett is Head of Retirement Research at Morningstar Investment Management ... [4] Investment Management: Jason Bortz is Senior Vice President and Senior Counsel at Capital Group ... [5] Employee organizations: Bridget O'Connor is General Counsel of the International Union of Bricklayers & Allied Craftworkers (BAC)." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
Text of Supreme Court Opinion: Railroad Stock Options Are Not 'Compensaion' Subject to Railroad Retirement Plan Tax (PDF)
23 pages. "[P]rivate railroads and their employees pay a tax based on employees' incomes. In return, the federal government provides employees a pension often more generous than the social security system supplies employees in other industries ... To encourage employee performance and to align employee and corporate goals, some railroads have (like employers in many fields) adopted employee stock option plans. The government argues that these stock options qualify as a form of 'compensation' subject to taxation under the Act.... When Congress adopted the Act in 1937, 'money' was understood as currency 'issued by [a] recognized authority as a medium of exchange.' Pretty obviously, stock options do not fall within that definition." [Wisconsin Central Ltd. v. U.S., No. 17-530 (U.S. June 21, 2018)] (Supreme Court of the United States)
[Opinion] ARA Calls for Electronic Delivery Update to 401(k) Disclosure Default
"Current regulations requiring paper delivery of participant 401(k) information can cost investors between $350-500 million per year, which can reduce the average account balance by 2.4% over a 40-year work life.... E-delivery improves access for the visually impaired and others with disabilities.... E-delivery improves access and the quality of information for those who speak English as a second language.... Internet access -- especially among DC account holders -- is nearly universal." (American Retirement Association)
Judge Strikes Down Kentucky's New Pension Reform as Unconstitutional
"[The judge] ruled that the General Assembly didn't follow Kentucky law by giving the bill three readings on three separate days in each chamber.... The controversial bill ... created [a] 401(k)/pension hybrid, which would decrease the cost of living pay increases for state employees, including teachers. It would have required teachers who were hired after Jan. 1, 2019, to work longer before being eligible for retirement." [Commonwealth of Kentucky v. Bevin, Nos. 18-CI-379 and 18-CI-414 (Cir. Ct. Franklin Cty., June 20, 2018)] (The Hill)
Delivering ERISA Disclosure for DC Plans: Why the Time Has Come to Prefer Electronic Delivery (PDF)
"This document provides a 2018 update to the 2011 study ... This 2018 update concludes that the reasons to shift to electronic delivery have become even stronger during the intervening seven years.... Paper delivery costs significantly more than electronic delivery, and the government norm in other settings has become electronic delivery.... For tens of millions of people, access is better with electronic rather than paper delivery ... The internet has become a pervasive technology, similar to the telephone, so concern about lack of access to the internet is not a sound basis for preferring paper delivery." (Peter Swire & DeBrae Kennedy-Mayo)
[Opinion] Dividing Retirement Benefits at Divorce Shouldn't Be This Hard
"Hundreds of people contact the Pension Rights Center every year seeking help in obtaining benefits awarded under a divorce decree.... The Pension Rights Center is currently working to bring together many different groups -- including employers, family law judges, retirement plan administrators, family law specialists, women's organizations, pension experts, and advocates for survivors of domestic violence -- to engage in a dialogue about ways to make the QDRO process more affordable and less complex." (Pension Rights Center)
Retired California Employees Must Pay Back Pension Overpayment
"The [California Appellate Court] affirmed a trial court decision that two retired officers must pay the San Diego City Employees' Retirement System more than $30,000 combined, finding that the overpayments had been a mistake, albeit a costly one for the former officers." [Krolikowski v. San Diego City Employees Ret. Sys., No. D-071119 (Cal. Ct. App. June 14, 2018)] (
[Opinion] The Pension Train Has No Seat Belts
"This is the base challenge: How can a shrinking group of working-age people support a growing number of retirement-age people? The easy and quick illustration to this question is to talk about the number of workers supporting each Social Security recipient. In 1940, it was 160. By 1950 it was 16.5. By 1960 it was 5.1.... [It] will be 2.3 by 2030." (Mauldin Economics)
[Opinion] Should We Continue to Count on Employers to Meet Society's Need for Secure Retirement?
"Employees are a captive audience.... Employers are also able, if they're large enough ... to select low-fee fund options for their employees ... [But] an employer-based system misses those without conventional employment (part-timers, freelancers, contractors, small business employees or owners) ... The very employer match that serves as an incentive to make a contribution, can act as a ceiling, in which employees take the match as the recommended maximum contribution level." (Elizabeth Bauer, in Forbes)
Anthem 401(k) Investor Ordered to Disclose Facebook Messages
"A participant in Anthem's 401(k) plan must disclose to the company's attorneys some of her Facebook private messages concerning her lawsuit accusing Anthem of allowing excessive fees in the plan. The Facebook private messages ... discussed the participant's emotional status over her upcoming deposition, a future meeting with the attorneys, and that she wanted to be a 'good representative'[.]" [Bell v. Pension Comm. of ATH Holding Co., No. 15-2062 (S.D. Ind., order on motion to compel, June 14, 2018)] (Bloomberg BNA)
[Opinion] ARA Recommendations for IRS 2018-2019 Priority Guidance Plan (PDF)
"ARA recommends that the Retirement Benefit items listed [in this letter] be included on the 2018-2019 Guidance Priority Plan, in the following order of priority ... [1] Update and expand EPCRS ... [2] Guidance regarding the aggregation rules for affiliated service groups under Section 414(m) ... [3] Determination letter program ... [4] Church plan issues ... [5] Mid-year changes to safe harbor plans ... [6] Missing participants ... [7] Merger and acquisition issues ... [8] Lifetime income guidance ... [and seven more items]." (American Retirement Association [ARA])
Retirement Jargon Confusion
"Fiduciary Liability Insurance vs. Fidelity Bond ... Roth Contributions vs. Roth Conversions ... Multiemployer Plans vs. Multiple Employer Plans." (Cammack Retirement Group)
Are Multiple Employer Plans Right for You?
"While 92 percent of large businesses with 500 or more employees routinely offer a 401(k) or similar plan, only 53 percent of small to mid-sized firms with 5 to 250 employees do.... [C]ost was cited by 37 percent and lack of organizational resources by 22 percent of companies as reasons for not offering a retirement savings plan. MEPs could eliminate these obstacles and make it easier for firms to offer a 401(k), 403(b) or a comparable plan." (PlanPILOT)
[Opinion] Testimony of U.S. Chamber of Commerce to Joint Select Committee on Multiemployer Pension Plans: Employer Perspectives
"[R]escue legislation is urgently needed. Congress can no longer kick the can down the road.... Our recommendation is for long-term, low-interest loans that will protect taxpayers from financial liability.... [W]hile the PBGC may ultimately need more money, in the form of increased premiums paid by employers, these increases must be evaluated after tools to restore the solvency of these plans are put in place.... [C]omposite plans must be authorized so that healthy multi-employer plans can stay that way." (U.S. Chamber of Commerce)
Securing Future Retirements: Innovations in Planning Strategies, Financial Products and Employee Benefit Plan Structure (PDF)
80 pages; 18 essays. "The primary motivation of this year's call for essays was to identify potential solutions and new innovations being developed to assist workers and retirees better prepare for retirement.... The full essay collection is found in this publication and sets forth ideas that can be further developed or that will spur thinking for new products, planning tools and employee benefit plan strategies." (Society of Actuaries)
EBRI Retirement Security Projection Model: Analyzing Policy and Design Proposals (PDF)
17 pages. "[This Issue Brief examines] the impact of various retirement-reform proposals on all US households between the ages of 35 and 64 by first assessing the current, aggregate national-retirement deficit, and then examining the impact of the following potential initiatives: [1] Auto Individual Retirement Account (IRA) programs ... [2] Programs expanding access to defined contribution plans ... [3] A universal defined-contribution scenario. [4] Auto-portability proposals. [5] Proposed reductions in the 402(g) and/or 415(c) limits." (Employee Benefit Research Institute [EBRI])
Planning for Retirement: The Impact of Divorce (PDF)
"[W]hile half of all American households are at risk of not being able to maintain their pre-retirement standard of living after they stop working, that risk is 7 percentage points higher for households where at least one person has been through a divorce." (Prudential)
How Does Divorce Affect Retirement Security? (PDF)
11 pages. "[T]his brief investigates how divorce impacts the National Retirement Risk Index (NRRI).... [D]ivorce substantially increases the likelihood of being at risk in retirement. The unexpected result is that the effects vary by type of household: large effects for divorced single men and couples with a previously divorced spouse, but no effect for divorced single women." (Center for Retirement Research at Boston College)
Arizona Court of Appeals Misses with Fraudulent Transfer Opinion for ERISA Contributions
"[T]he Court of Appeals' attempted distinction would mean that if a non-sponsor employer (i.e., a third-party outsider to the plan) made a contribution to an ERISA plan, that contribution could be unwound as a fraudulent transfer, but if the employee herself made a contribution to an ERISA plan, then hands-off.... At best, the Court of Appeals holding in Shah v. Blaloch is at best dubious, and should be the subject of challenges in subsequent cases." [Shah v. Blaloch, No. 1 CA-CV 15-0812 (Az. App. Oct. 12, 2017)] (Forbes)
[Opinion] The Retirement Revolution: Regulatory Reform to Enable Behavioral Change (PDF)
18 pages. "We need better-targeted tax incentives, easier saving mechanisms, cultural and legal advances that enable longer working lives, laws that better enable long-term care insurance and deferred annuities, a re-formed reverse mortgage market, and help for households in managing their retirement assets and achieving greater security." (The Brookings Institution)
CalSavers Lawsuit Raises Tricky ERISA Questions
"While the court may be addressing a narrow question, its answer is anything but clear.... The [DOL] addressed IRAs provided to workers through employers in a 1975 safe harbor.... But as California and other states began exploring state-administered IRA plans over the past decade, the 1975 safe harbor did not provide enough protection for prospective employers in state-administered plans[.]" (BenefitsPro)
Fate of the Fiduciary Rule: Appellate Courts Have Spoken, But What Comes Next? (PDF)
"After a quick review of the portions of the Fiduciary Rule relevant to the Fifth and Tenth Circuit litigation, [the authors] explain what the two recent opinions did, and did not, say. [They] conclude with ... thoughts on the possible impact of these opinions and whether the Fiduciary Rule will proceed through the court system, be re-worked by DOL, face a re-write from the [SEC] or Congress, or be left to the states to resuscitate." (Miller & Chevalier, in The Investment Lawyer)
American Academy of Actuaries' Answers to Questions Posed by Joint Select Committee on Multiemployer Plans (PDF)
39 pages. "On behalf of the Pension Practice Council of the American Academy of Actuaries, I appreciate the opportunity to provide the following responses for the record to questions provided us pursuant to [April 18, 2018 hearing on] The History and Structure of the Multiemployer Pension System[.] ... The Pension Practice Council ... stands ready to help you at each step of the way with objective and nonpartisan input." [Editor's note: Includes more than 40 questions from legislators, with detailed answers.] (American Academy of Actuaries)
[Opinion] ARA Letter to EBSA Protesting Letters to Plan Sponsors Threatening 'Alternative Enforcement Measures' (PDF)
"[R]ecent letters to plan sponsors from Chris Davis, Associate Regional Director of the Chicago Regional Office of the [DOL] ... threaten 'alternative enforcement measures' against plan fiduciaries who choose to correct the late deposit of employee contributions outside of the Voluntary Fiduciary Correction Prog ram (VFCP). Such threats are inappropriate and clearly are intended to scare plan sponsors into participating in what is supposed to be a voluntary program.... ARA respectfully requests that DOL immediately cease using such threats as a means to increase VFCP filings." (American Retirement Association [ARA])
Text of IRS Publication 4344: 2018 Report of Recommendations of Advisory Committee on Tax Exempt and Government Entities (PDF)
87 pages. The Employee Plans Subgroup provided 2 reports: [1] Recommendations regarding re-opening the determination letter program in certain circumstances (begins on page 9); and [2] Recommendations regarding missing participants (begins on page 21). (Advisory Committee on Tax Exempt and Government Entities [ACT])
[Opinion] What Does the Increasing Gap in Retirement Ages Mean for Pensions?
"In 2016, ... men with a high school degree retired at age 62.8 and men with a college degree retired at age 65.7. This age gap matters when it comes to saving for a secure retirement." (National Public Pension Coalition)
[Opinion] How Fixing the Form 5500 Could Help Illuminate 401(k) Plans' Quality
"Here are three areas where the Form 5500 requirements are lacking key information: [1] Investment lineup information on the retirement plan disclosures are often incompatible with SEC filings, making it impossible to match information on the investments available within 401(k) plans to other data that the SEC collects.... [2] The Form 5500 also fails to require key data on popular investment types, such as collective investment trusts.... [3] Information on the administrative and investment fees participants pay is inaccurate and limited." (Morningstar Advisor)
Ninth Circuit Holds That Constructive Notice Is Sufficient to Impose Withdrawal Liability on Successor Employer Under MPPAA
"The Ninth Circuit held that Amstar was on constructive notice of Ohana's withdrawal liability ... [and] identified three relevant facts to support this holding: [1] Amstar previously operated a hotel that participated in a multiemployer pension plan, and, in earlier acquisitions involving multiemployer pension plans, Amstar had sought to determine whether it could incur withdrawal liability. [2] The purchase and sale agreement stated that the employees at Ohana were unionized and that Ohana had contributed to a multiemployer pension plan. [3] The Plan's annual funding notices, indicating that the Plan was underfunded, were publicly available on the internet." [Heavenly Hana LLC v. Hotel Union & Hotel Industry of Hawaii Pension Plan, No. 16-15481 (9th Cir. June 1, 2018)] (Thomson Reuters Practical Law)
Accurately Evaluating the 'Retirement Crisis' (PDF)
"Examining households headed by individuals ages 35-64 that are seeking to cover 100 percent of the deterministic average costs for retirees in their age-, income-, and family-status cohorts, the [EBRI Retirement Security Projection Model (RPSM)] finds that 57.4 percent are simulated to not run short of money in retirement. In other words, just over half of U.S. households are on track for 'retirement success' by this measure." (Employee Benefit Research Institute [EBRI])
Do We Really Have a Retirement Crisis in America?
"There are certainly people who ended up working longer than they originally intended or scaled back their retirement expectations for various reasons. But by and large, Americans seem to find a way to make do ... [M]edian household spending actually dropped by as much as 12.5% in the first four years of retirement, and by the sixth year a majority of households were spending less than 80% of what they spent during their working years." (Financial Finesse)
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