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January 23, 2004 - 13,655 subscribers
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Congress Readies Pension Break
Excerpt: "Companies struggling to meet staggering pension obligations are in line for some immediate help from Congress -- reduced contributions to their retirement plans. It's a $26 billion break over the next two years, with additional relief for the airlines and steel industry. The Senate began debating the measure Thursday after more than 200 companies, including AT&T Corp., Exxon Mobil Corp. and IBM Corp., wrote senators last week urging quick passage." (AP via The Hawk Eye)
Administration Officials Warn of Possible Veto of Pension Funding Legislation
Excerpt: " Senior administration officials warned the Senate Friday that they would advise President Bush to veto special help for airlines and steel companies as part of broader pension funding relief." (Reuters via Forbes.com)
Senate Begins Debate on Pension Funding Bill
Excerpt: "The Senate on January 22 began to consider a bill that would establish a new interest rate for determining the liability of defined benefit pension plans. Backers of the Pension Funding Equity Bill of 2003 (HR 3108) say it is necessary because the current interest rate used to calculate plan liabilities is too low, resulting in artificially high payments by companies to fund their plans." (CCH Tax News)
Text of Republican Policy Committee Release on Pension Funding Act (PDF)
6 pages; 1/21/04. Excerpt: "H.R. 3108 - Pension Funding Equity Act of 2003." (Republican Policy Committee via American Benefits Council)
Text of Senate HELP Committee Report on 30-Year Treasury Rate Replacement Legislation (PDF)
18 pages; 1/9/04. Excerpt: "The Committee on Health, Education, Labor, and Pensions, reported an original bill (S. 2005) to temporarily replace the use by pension plans of the 30-year treasury bond rate with a composite corporate rate, and to establish a commission on defined benefit plans, having considered the same, reports favorably thereon without amendment and recommends that the bill do pass." (U.S. Senate Health, Education, Labor & Pensions Committee via American Benefits Council)
Text of PBGC Board's Letter to Sen. Frist About H.R. 3108, the Pension Funding Equity Act
Excerpt: "As you are aware, the Senate has entered into a unanimous consent agreement for the consideration of H.R. 3108, the Pension Funding Equity Act. We appreciate the Senate's timely action on this issue of great importance to America's workers and pension plans sponsors. We are writing to you in our role as the board of the Pension Benefit Guaranty Corporation (PBGC)." (Pension Benefit Guaranty Corporation via ERISA Industry Committee)
Text of Pension Funding Equity Act (H.R. 3108) Being Considered by Senate: Managers' Amendment
Excerpt: "The Senate is considering H.R. 3108, the Pension Funding Equity Act, with amendments limited by number and subject matter. As passed by the House, H.R. 3108 would provide two years of relief for all defined benefit pension plans facing required contribution levels that may be artificially inflated. The bill provides relief by replacing the discontinued 30-year Treasury bond interest rate with a rate based on a composite of long-term corporate bonds for years 2004 and 2005." (Via ERISA Industry Committee)
The 412(i) Plan: Making Up for Lost Time
Excerpt: "If you've heard fellow entrepreneurs talking about their 412(i) lately, you can be forgiven for thinking it might be a new sports car. In fact, the 412(i) is far more mundane--but a better bet if you're behind on your retirement savings." (Fortune)
Text of Rev. Rul. 2004: Prohibited Allocations of Securities in an S Corporation (PDF)
13 pages. Excerpt: "In the three situations described below, (1) are the individuals disqualified persons within the meaning of § 409(p)(4) of the Internal Revenue Code (the Code), (2) does the related employee stock ownership plan (ESOP) have a nonallocation year within the meaning of § 409(p)(3), and (3) are any disqualified persons treated as owning synthetic equity within the meaning of § 409(p)(5)?" (Internal Revenue Service)
Opinion: Don't Buy Into Pension Obligation Bond Plans
Excerpt: "States and localities across the U.S. are going to consider selling bonds to raise money for their pension systems, still depleted by the stock market collapse in 2001. One word of advice: Don't." (Joe Mysak on Bloomberg.com)
Mercer Survey Reveals U.S. Retirement Program Trends
Excerpt: "Mercer invited its US clients to participate in an online retirement program survey designed to identify how employers and their employees were coping with volatile stock markets, low interest rates, double-digit medical cost increases and unstable defined contribution account balances. A total of 242 companies responded. Based on our survey results, we have identified these five key trends:" (Mercer Human Resource Consulting)
Text of ACLI President's Speech on Baby Boomers' Retirements (PDF)
17 pages; 1/20/04. Excerpt: "[W]e are simply not saving enough, as a nation or as individuals, to enjoy a retirement that is anywhere near as comfortable as the lives we're living today. In recent congressional testimony, Governor Keating predicted that there is a 'tidal wave' coming of 76 million soon-to-be-retiring baby boomers, and the vast majority of them are not prepared." (American Council of Life Insurers)
Women Face Retirement Hurdle
Excerpt: "The overall retirement goal for men and women isn't that different: Save enough so you don't outlive your money. But women have a tougher challenge: They tend to live longer than men, which means they have to make their money last longer." (Dallas Morning News via IndyStar.com)
Employees' Investment Decisions about Company Stock
Working paper. Excerpt: "We study the relationship between past returns on a company's stock and the level of investment in that stock by the participants in that company's 401(k) plan. Using data on 94,191 plan participants, we analyze several different decision points: the initial fraction of savings allocated to company stock, the changes in this fraction, and the reallocations of portfolio holdings across different asset classes." (National Bureau of Economic Research)
Links to Items on Executive Comp, Benefits in General
A Global Demographic Time Bomb
Excerpt: "A shocking report released at the World Economic Forum lays out how aging and falling populations could slam world growth." (Business Week)
2003 Legislative and Regulatory Year in Review and the Outlook for 2004
Excerpt: "Congress failed to extend some expiring tax provisions before adjourning in December, and pledges to act early in 2004 to provide a seamless extension of these laws." (Hewitt)
Newly Posted Events
Health Action 2004: Families USA Annual National Grassroots Meeting
Nationwide on January 22, 2004
presented by Kaiser Family Foundation
Certificate in Employee Benefits Law Seminar
in California on July 19, 2004
presented by Institute for Applied Management & Law, Inc.
Health Plan HIPAA Privacy Teleconference
in California on February 25, 2004
presented by Institute for Applied Management & Law, Inc.
Certificate in Employee Benefits Law Seminar
in Nevada on September 2, 2004
presented by Institute for Applied Management & Law, Inc.
Advanced Certificate in Employee Benefits Law Seminar
in Florida on October 2, 2004
presented by Institute for Applied Management & Law, Inc.
Certificate in Employee Benefits Law Seminar
in Florida on March 8, 2004
presented by Institute for Applied Management & Law, Inc.
Certificate in Employee Benefits Law Seminar
in Arizona on March 22, 2004
presented by Institute for Applied Management & Law, Inc.
Certificate in Employee Benefits Law Seminar
in District of Columbia on June 14, 2004
presented by Institute for Applied Management & Law, Inc.
Certificate in Employee Benefits Law Seminar
in Florida on July 12, 2004
presented by Institute for Applied Management & Law, Inc.
Newly Posted Press Releases
Treasury and IRS Shut Down S Corporation ESOP Abuses
(Internal Revenue Service (IRS))
New EBRI Research: Defined Contribution Worker Coverage Grows; Retirement Savers Continue Reliance on Stocks
(Employee Benefit Research Institute (EBRI))
Newly Posted or Renewed Job Openings
Defined Benefit Implementation Specialists
for Constantin Control Associates
in IL, NJ, NY, PA
Retirement Plan Specialist
for Diversified Investment Advisors
in IA
Tax Manager - Benefits/Compensation
for JCPenney Company
in TX
Communication Director
for Cigna
in CT, IL, TX
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