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March 4, 2004 - 13,655 subscribers
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Investment Advisors: Don't Take Away Soft Dollars
Excerpt: "The issue of soft-dollar arrangements continues to show why it is controversial and divisive as an investment advisor group spilt with the leading mutual fund trade association over banning the use of soft dollars to pay for research and other benefits." (PLANSPONSOR.com; one-time registration required)
Towers Perrin Says City of Houston Knew of Pension Fund Shortfall; City Blames Firm's Estimates
Excerpt: "Towers Perrin says city officials knew the deficit gap would grow if the benefits for retirees went up. At the same time, the city claims no one ever told them they would be facing a $1.5 billion shortfall over the next 18 years." (News24Houston.com)
Opinion: Houston's Officials Too Timid To Fight, Too Indifferent To Harm
Excerpt: "It's not surprising that the city of Houston's pension fund shortfall may be as much as $1.5 billion over the next 18 years -- a shortfall that will hit Houston taxpayers with higher taxes, fewer services or both. It's not surprising because nobody has been minding the store at City Hall for the past six years." (Houston Chronicle)
Practitioner's Forum on Regs Affecting Valuation of Life Insurance in Qualified Plans, 412(i) Issues
Excerpt: "The discussion centers on recently proposed Treasury Regulations that will affect how life insurance policies are valued and IRS guidance that addresses perceived abusive transactions involving §412(i) plans. A §412(i) plan is a tax-qualified retirement plan that is funded by life insurance products. The IRS guidance designates certain transactions involving §412(i) as 'listed transactions.'" (BNA Tax Management)
Overview: Abusive S Corporation ESOP Arrangements Declared Listed Transactions
Excerpt: "Earlier this year, the Internal Revenue Service (IRS) issued a revenue ruling identifying certain abusive arrangements involving S corporation employee stock ownership plans (ESOPs) and making these transactions 'listed transactions' for tax shelter disclosure purposes. This article briefly summarizes the ruling and its impact." (BNA Tax Management)
Social Security Bill Signed Into Law
Excerpt: "The Social Security reform bill, HR 743 [Public Law No. 108-203], that impacts public sector employees has been signed into law by President Bush on March 2, 2004. There are 3 key provisions in the bill that impact public employees: ..." (National Conference on Public Employee Retirement Systems)
Nashville Mayor Proposes Bounty for Early Retirements
Excerpt: "Mayor Bill Purcell yesterday unveiled a buyout plan for retirement-eligible Metro employees in an effort to cut back payroll costs as the city prepares for what the administration has portrayed as a bruising budget year. The plan will pay employees $500 for each year served with Metro if they choose to retire." ([Nashville] Tennessean)
DB vs. DC Debate in Colorado
Excerpt: "The state of Colorado is locked in a political battle over whether it should add a defined contribution (DC) plan and how it can best whip into shape its existing underfunded defined benefit (DB) pension program. Governor Bill Owens has told the Colorado Public Employees' Retirement Association (PERA) that state workers should be able to choose between the DB plan and a K-plan style DC program, the Rocky Mountain News reported." (PLANSPONSOR.com; one-time registration required)
Babyboomers Face Retirement Squeeze
Excerpt: "The number of Fortune 100 companies supplying fixed-rate pensions has dropped to 50 percent." (Christian Science Monitor)
Overview: DOL Provides Fiduciary Guidance for Dealing with Mutual Fund Abuses
Excerpt: "The new guidance, a brief but significant statement from Assistant Secretary of Labor Ann L. Combs, responds to numerous requests for the DOL's views on the mutual fund scandals. In addition to outlining factors that plan fiduciaries must consider in reviewing plan investments in mutual funds that are under investigation, the DOL statement notes that other pooled investment vehicles may be subject to similar abuses." (BNA Tax Management)
Overview: EBSA Assistant Secretary States Views On Market Timing and Late Trading (PDF)
4 pages. (Kilpatrick Stockton LLP)
Witnesses' Prepared Testimony at 3/2/04 Senate Hearing on Mutual Fund Operations and Governance
3/2/04. Video also available at target page. Witnesses: Honorable William L. Armstrong, Oppenheimer Funds; Marvin L. Mann, Fidelity Funds; Vanessa C.L. Chang, El & El Investments; Michael S. Miller, The Vanguard Group; Ann E. Bergin, The Depository Trust & Clearing Corporation; William A. Bridy, Merrill Lynch; Raymond K. McCulloch, BB&T Trust; David L. Wray, Profit Sharing/401(k) Council of America. (U.S. Senate Committee on Banking, Housing and Urban Affairs)
The QDRO Gamble, Part 2
Excerpt: "There is a developing problem that I believe must be considered when negotiating the settlement language addressing future pension payments. If you use a Qualified Domestic Relations Order as the settlement tool in a State that employs Matured Full Benefit distribution methodology (non-participant's share of the pension is based on actual retirement income of the participant) and you represent the non-participant spouse, you will be facing this problem." (Paul R. Commerford on DivorceNet.com)
Links to Items on Executive Comp, Benefits in General
Organization Chart for the Employee Benefits Security Administration
(U.S. Department of Labor, Employee Benefits Security Administration)
Opinion: Grocery Strike Ended in Defeat
Excerpt: "On health care-- the key issue in the strike-- the contract gives the companies a 50 percent share in administering the health-care fund, which had previously been union-run. The deal caps employers' contributions to the fund, which means that employees will pay all future increases in health care costs beyond a specified amount." (Socialist Worker)
Opinion: Union Sacrifices Grocery Workers While Declaring Victory
Excerpt: "After more than four months on the picket lines, the workers ended up with a deal that is certainly inferior to their previous contract, and in some respects inferior to the contract proposal they rejected just before the strike.... Union officials defend this outcome by accepting, in effect, the supermarkets' position that they needed to cut labor costs to compete with Wal-Mart Stores Inc. and other cut-price grocers." (Michael Hiltzik in the Los Angeles Times; one-time registration required)
The Medicare and Social Security Challenge
Excerpt: "When Alan Greenspan urged Congress last week to cut future benefits in Social Security and Medicare, sending elected officials to the barricades, he was if anything understating the magnitude of the problems ahead." (New York Times; one-time registration required)
Opinion: Greenspan Helps Us Navigate Through Benefits Fog
Excerpt: "The trouble is demographic. Social Security was established at a time when average life expectancy at birth was 62 and benefits began at 65. Now, life expectancy is 77, and you can begin drawing checks at 62. It's a double whammy because, as the population ages, there are fewer workers to provide them with benefits." (James K. Glassman in the Washington Times)
Newly Posted Events
SPARK National Conference
in Florida on May 12, 2004
presented by RG Wuelfing & Associates
Employee Benefits Conference
in New York on May 18, 2004
presented by Foundation for Accounting Education
Newly Posted Press Releases
Catalog of Resources Published by International Foundation of Employee Benefit Plans
(International Foundation (of Employee Benefit Plans, or IFEBP))
Labor Department Official Testifies Before Senate Finance On Health Insurance Scams
(U.S. Department of Labor, Office of Public Affairs, Washington, D.C.)
Newly Posted or Renewed Job Openings
401(k) Administrator
for GAP-Pension Inc.
in NJ
Retirement Plan Coordinator
for T Rowe Price
in MD
Manager, Benefits Plan Administration
for NRECA
in VA
Employee Benefits Paralegal
for Chang, Ruthenberg & Long, P.C.
in CA
Account Executive - Retirement Services
for Principal Financial Group
in LA
Human Resource Assistant
for A Prestigious International Law Firm
in DC
ERISA Consultant
for BISYS Retirement Services
in MN
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