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The BenefitsLink Newsletter -
Retirement Plans Edition


November 14, 2000

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ASPA to DOL: Little-Used Program Allows 403(b) Sponsors to Determine ERISA Applicability
Excerpt: "The American Society of Pension Actuaries requests the Pension and Welfare Benefits Administration to publicize the availability of ERISA Procedure 76-1 for issues which affect tax-sheltered annuity arrangements... ASPA proposes that an information bulletin or press release be issued, or other outreach medium be used, to announce to TSA sponsors the availability of the information letter and advisory opinion process to organizations whose employees participate in TSAs." (American Society of Pension Actuaries)

Uniformed City Workers Angry Over Pension Plan
Excerpt: "After a nine-month battle over pensions, many men and women of the Savannah fire and police departments still feel they're getting a raw deal. Last week, officers held an impromptu meeting to discuss the newest pension proposal, which raises the previously proposed retirement age and changes the pension accrual rate - again." (Savannah [Ga.] Morning News)

Bertelsmann Foundation Study on Advance Funding of Pensions in Europe (PDF)
Excerpt: "The International Reform Monitor project of the Bertelsmann Foundation has published a special issue on advance funding of pensions. This issue takes a comparative and policy-related perspective: it gives an overview of recent reforms with respect to advance funding in 15 OECD countries as well as local experts' assessments of the design of pension reform." (Johannes Leinert and Andreas Esche; published by Bertelsmann Foundation)

Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
My husband worked for the Milwaukee Road for more than 20 years. He retired and received Railroad Retirement. When he died two years ago, I was told that because I receive my own federal Civil Service annuity I cannot get a widow's benefit. This seems very unfair if it is true. Can you explain why? (BenefitsLink.com)

Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
A friend of mine worked for the Grand Trunk Western in the 1970's. He would like to find out what happened to his pension contributions (he is sick and could use the money). He was told his railroad work credits have been transferred to Social Security. Is this true? Why hasn't he received notice of this? (BenefitsLink.com)

Senate Finance Committee Gives Green Light to Cash Balance Conversions
Excerpt: "In early September, the [Senate Finance] committee reported out its version of [H.R. 1102]. Included in its bill are a number of provisions that would have an impact on cash balance conversions... [including a] provision that the committee report says is 'designed to prevent the use of "wear away" provisions under which participants earn no additional benefits for a period of time after a conversion of a traditional defined benefit plan to a cash balance plan.'" (Jonathan Forman, University of Oklahoma College of Law)

ERISA Aspects of Handling Terminated Employees' Accounts
Excerpt: "But if a departing employee decides to leave the money inside the plan, it raises questions about the employer's obligations to the departed participant, [Ted] Benna says." (National Underwriter Company)

Sub-IRA Accounts Can Be Effective in Planning for Required Minimum Distributions
Excerpt: "Dividing a single IRA into subaccounts for required minimum distribution purposes can be a great planning tool. If it is done properly, the owner is able to get the benefit of the longer life expectancies of younger beneficiaries (meaning lower taxable distribution amounts). By dividing one IRA instead of creating separate IRAs, the owner avoids the paperwork and record keeping hassles of several different accounts." (National Underwriter Company)

ASPA Files Comments With IRS on Latest Loan Regulations
Topics addressed include leaves of absence, refinancing, multiple loans, withholding, and the permitted cure period. (American Society of Pension Actuaries)

Automatic 401(k) Plan Enrollment Becomes Trend
Excerpt: "When employers gather the contributions, they're faced with another decision: how to invest the money.... the stock market is considered the best choice for young workers investing for retirement, because over the long term, it has always out-performed bonds or cash. But employers may not be willing to hear the cries of pain from workers whose retirement plans are shrinking in the short term because of a bear market." (Knight Ridder/Tribune)

Funds of Funds: No Industry Standards for Disclosure
Excerpt: "The amount of information provided to investors by fund-of-funds managers varies. So do fund-of-funds managers' reasons for providing detailed documents-- or failing to.... What this means is that fund-of-funds managers may or may not provide you with such basic information as the names of hedge-fund managers employed, the individual and aggregate amount of exposure to a particular investment or strategy and individual hedge-fund performance data on a monthly and year-to-date basis." (Worth magazine)

A Retirement Plan That Wall Street Likes
Excerpt: "Wall Street [is] lobbying for privatized Social Security accounts and the windfall they would bring to investment firms. But millions of Americans just entering the work force or in midcareer would probably join in. They seem to share Mr. Bush's faith in the stock market, his faith that the robust economy can avoid a damaging recession, his ideological preference for less government in people's lives and his skepticism that Social Security will still be solvent when they retire." (New York Times; free registration required)

Another Question is Answered in the Tax Exempt Organizations Q&A Column
Must Code Section 403(b) arrangements file a Form 5500? In addition, must such arrangements provide summary annual reports to their participants? (BenefitsLink.com)

(Following also appears in Welfare Plans Edition)

Palm Beach Ballot Confuses Several Thousand Voters-- A Lesson Here for Plan Administration Forms?
(BenefitsBoards.net)

Federal Government Website is 'Official Website for Searching the U.S. Government'
(FirstGov.gov)

Plaintiffs' Attorney Making Brief Bank Available to Lawyers Who Contribute a Brief
(Blair Brininger, P.C.)

Graef Crystal: Warnaco Needs Cash to Show Wachner the Door
Excerpt: "How does a board of directors fire its chief executive when the company doesn't have enough cash to fund the CEO's severance package? That's the question at Warnaco Group Inc., where an amazingly tolerant board must decide whether to dispense with the services of CEO Linda Wachner." (Graef Crystal, on Bloomberg.com)

ASPA to DOL: Reduce Penalties Under DFVC Program
Excerpt: "ASPA supports DFVC because it permits and encourages an ERISA plan administrator to come forward and file a delinquent return without imposition of the entire statutory penalty.... However, ASPA also believes that the penalties under DFVC, although reduced from the maximum possible amount, are still too high to effectively encourage voluntary compliance to correct the deficiency." (American Society of Pension Actuaries)



Job Openings Newly Posted or Reposted on EmployeeBenefitsJobs.com


Retirement Sales District Managerfor ADP, Inc.
in CA, NY
Account Consultantfor Hartstein Associates, Inc.
in NJ
Service Integration Managerfor Fidelity Investments - Marlborough Campus
in MA
401(k)/DC Pension Consultantfor CBIZ Retirement Services Inc.
in NY
Pension Administratorfor California Retirement Plans
in CA
Pension Account Executivefor Diversified Investment Advisors
in CA, IL, MA, NC
Client Service Consultant, Client Integration Teamfor Diversified Investment Advisors
in NY
Benefits Associatefor Black Mountain Management
in NY
Supervisor - Health and Welfare Plansfor Black Mountain Management
in NY
Benefits Associatefor Black Mountain Management
in NY
Benefits Associatefor Black Mountain Management
in NY
Pension Administratorfor Benefits Consulting Group
in MA
Sr. Benefit Administration Specialist-Multiple Locationsfor Towers Perrin
in PA, VA

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