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July 13, 2004
Today's sponsor: The International Foundation

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celebrate 50 years of education with 6,000 of our friends. Each
year, thousands of employee benefit decision makers return for
the best in education featuring comprehensive support materials,
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Click above to find out what you're missing.

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
The Legality of Kickbacks: How 401(k) Vendors are Paid (PDF)
10 pages. Excerpt: "With the SEC's formal announcement of its investigation into the 401(k) revenue sharing practices of several major fund families, the focus on these under-the-table payments has intensified as never before. What are the current rules? Are these payments legal or illegal? Ethical or unethical? And what is an appropriate model for these practices that avoids conflicts of interest and sheds daylight on the true costs of a qualified plan?" (Unified Trust Company N.A.)

Are All Hybrid Plans As Bad As the Media Say They Are?
Excerpt: "Ask some of cash balance plans' traditional critics whether a good cash balance plan can exist, and you hear a lot about the problems they see with existing plans. Yet, they also allow that some cash balance plans may have good elements." (PLANSPONSOR.com; one-time registration required)

The Impact of Health Status and Out-of-Pocket Medical Expenditures on Annuity Valuation (PDF)
Working paper by Cassio M. Turra and Olivia S. Mitchell. Excerpt: "This paper describes how differences in health status at retirement can influence the decision to purchase a life annuity. We extend previous research on annuitization decisions by incorporating the effect of health differentials via differences in survival throughout the latter portion of life.... Our results show that annuities become less attractive to people facing uncertain medical expenses." (Pension Research Council)

Overview: IRS Delays Effective Date of Final Relative Value Regulations (PDF)
2 pages. (Prudential Retirement's Pension Analyst)

Strategy To Fix Dallas Municipal Pension Fund Is Praised
Excerpt: "The Texas Pension Review Board is taking Dallas off its endangered list. Board chairman Frederick E. 'Shad' Rowe said Monday that he was 'very impressed' by the city's plans to repair its ailing employee retirement fund ... He said Dallas' strategy – charging a panel of local business executives with finding a fair solution – worked so well it should be employed by other cities across the state." (Dallas Morning News; one-time registration required)

Opinion: Unaffordable Pension Outcomes in California
Excerpt: "Not long ago we learned that the all-time highest-paid employee of L.A. County, a physician, made $295,000 last year, including overtime. Now we can tell you that 1,198 retired L.A. County employees are collecting $100,000 a year or more, and the biggest pension for a retired county employee is $316,047." ([Long Beach CA] Press-Telegram)

Opinion: California in Pension Purgatory
Excerpt: "Public retirement system created a class of millionaires at taxpayer expense." (Los Angeles Daily News)

Distributional Effects of Defined Contribution Plans and Individual Retirement Arrangements
By Leonard E. Burman, William G. Gale, Matthew Hall and Peter Orszag. Excerpt: "We find that about 70 percent of tax benefits from new contributions to defined contribution (DC) plans accrue to the highest-income 20 percent of tax filing units in 2004, and more than half go to the top 10 percent." (Urban Institute)

Making Your Next Plan Service-Provider Search Efficient and Successful
Excerpt: "Maybe your current 401(k) provider is taking too long to return your phone calls; maybe its investment lineup reads like a mutual fund scandal hit parade ... Whatever the explanation, it is time to search for a new retirement plan provider. Time to call a consultant, right? Maybe, but, even if you decide to let a consultant lead your search, there is still much that you, the plan sponsor, can do to make the search as efficient and successful as possible." (PLANSPONSOR.com; one-time registration required)

Opinion: What To Do if You're 55 and You Haven't Saved a Dime
Excerpt: "You're 10 years from retirement and have barely a penny to show for it. Time's a-wastin', so take these quick steps to get you started on a stronger retirement track." (MSN Money)

Questions for the Prudent Fiduciary to be Asking
Excerpt: "The first step in a prudent process is to investigate. Fiduciaries need to determine the information needed to make an informed decision, and then they need to gather that information. In a nutshell, fiduciaries need to ask the right questions--and get answers." (PLANSPONSOR.com; one-time registration required)

Links to Items on Executive Comp, Benefits in General

Massachusetts Same-Sex Marriage Ruling Leaves Uncertainty for Plan Sponsors
Excerpt: "When the Massachusetts Supreme Judicial Court ruled last year, by a slim 4-to-3 margin, that barring same-sex marriage was violative of the Bay State's constitution, it cited an interest in affording those couples 'the protections, benefits, and obligations of civil marriage' ... However, for plan sponsors who administer many of those 'benefits,' the impact is anything but clear, particularly outside the Bay State ..." (PLANSPONSOR.com; one-time registration required)

FASB Might Delay Stock Compensation Expensing Rule
Excerpt: "The Financial Accounting Standards Board (FASB) may delay the effective date of its proposed rules requiring fair value expensing for stock options and other equity awards. This Perspective Alert! discusses factors that may lead to the delay and suggests how companies should address the uncertainty." (Mercer)

Newly Posted Events

Consumer-Directed Health Care: The Next Big Thing?
Nationwide on July 9, 2004
presented by Kaiser Family Foundation

Don't Get Nailed In Court By Your Performance Reviews
Nationwide on August 5, 2004
presented by HRTrainingCenter.com

Employee Surveys: The Action Management Challenge
Nationwide on July 22, 2004
presented by HRTrainingCenter.com

Managed Accounts: What Plan Sponsors Need To Know
Nationwide on July 28, 2004
presented by Profit Sharing/401(k) Council of America (PSCA)

Fearless and Persuasive Speaking
Nationwide on July 20, 2004
presented by HRTrainingCenter.com

Improving Employee Performance
Nationwide on July 26, 2004
presented by HRTrainingCenter.com

Measuring Return on Investment from HR Initiatives
Nationwide on September 9, 2004
presented by HRTrainingCenter.com

PHR / SPHR Recertification Suite
Nationwide on July 12, 2004
presented by HRTrainingCenter.com

Setting and Managing 2005 Compensation Conference
in New York on September 19, 2004
presented by HRTrainingCenter.com
Newly Posted Press Releases

New Hay Group Study Finds Twenty-Five Percent of Companies Do Not Have Executive Severance Policies: Almost One-Third of CEOs Lack Employment Contracts
(Hay Group)

Responding to Urgent Need, Fee-only Retirement Plan Consulting Association Forms
(Revere Coalition)

National Benefit Advisors Group Hosts National Advisor Summit
(National Benefit Advisors Group)
Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Benefits Manager (Service Delivery Manager)
for Towers Perrin
in VA

Motivated Sales Representatives (3 positions open)
for Primark Benefits
in CA

Account/Client Services Manager
for Zenith Administrators
in CA, WA

Plan Contributions Services Specialist
for ICMA Retirement Corporation
in DC

Pension Administrator
for San Luis Pension Consultants, Inc.
in CA

401K Wholesaler
for Fortune 500 Insurance Carrier
in NY, TX

Senior Plan Administrator
for RSM McGladrey
in MN

Analyst/Consultant
for ESOP Economics, Inc.
in PA

Client Service Rep. - Defined Contribution Plans (401(k)/Profit Sharing)
for Decimal, Inc. (www.theonline401k.com/schwab)
in CA

Third Party Pension Administrator
for Karr Barth Pension Administration, Inc.
in PA

Employee Benefit Trust Officer I
for Regions Financial Corp.
in AL

Sr. Health & Welfare Consultant
for Mellon Human Resources & Investor Solutions
in TX

Director, Health & Welfare Consulting
for Mellon Human Resources & Investor Solutions
in TX

Pension Administrator
for The Nolan Company
in KS

Retirement Plan Consultant
for Metavante Corporation
in CA

Benefits Administrator
for Education Management Corp.
in PA

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