Retirement Plans
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September 19, 2006
Today's sponsor: ASPPA • Working for America's Retirement™

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ASPPA Fall 2006 Exams – Early Registration Ends September 30

ASPPA’s 2006 fall proctored examination window will be November 1 - December 15. Early registration ends September 30, and the final registration deadline is October 31.
Register online at To learn more about ASPPA exams, visit the Education and Examination Web page at Complete your exams this year. Sign up today!

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)

Tax Officials See Need to Resolve 'Disconnect' Between 457 and 409A Deferred Comp Rules
Excerpt: "If Code Sec. 457 plan eligibility requirements are not met, compensation deferred under the plan is taxable to the employee in the first year there is no substantial risk of forfeiture. In addition, the plans will be subject to the rules of Code Sec. 409A." (CCH Pension and Benefits)

Overview: PPA Requires Same Interest Rate for Maximum, Minimum Contributions for 2006 and 2007
Excerpt: "Although the Pension Protection Act ('PPA') of 2006 [P.L. 109-280] permits plan sponsors to continue using the composite long-term corporate bond rate (instead of the 30-year Treasury rate) to calculate their liabilities for minimum funding purposes in 2006 and 2007, it eliminates the rule that allowed sponsors to use a lower interest rate to calculate their maximum deductible contributions in 2004 and 2005." (Deloitte)

Issue in Brief: Do Older Workers Face Greater Risk of Displacement?
Excerpt: "This brief explores the displacement of older workers over the period 1984-2004 . . . . The first section summarizes why continued employment is important. The second section introduces key factors that could affect displacement trends. The third section describes the Displaced Worker Survey and reports the raw data. The fourth section reports regression results aimed at isolating the impact of age, tenure, and other variables on the probability of being displaced." (Center for Retirement Research at Boston College)

New Pension Law Clarifies Funding and Other Critical Issues for Plan Sponsors
Excerpt: "At last, companies have some answers to many of the questions that have complicated the financial management of pension plans in the last few years as a result of unresolved legal and regulatory issues. With the enactment of the Pension Protection Act (PPA) of 2006, signed into law by President Bush on August 17, much of the uncertainty about pension funding rules is removed." (Towers Perrin)

Texas Public School Employees Decry Pension Overhaul
Excerpt: "Gov. Rick Perry's office has asked the Teacher Retirement System of Texas to budget based on the state contributing 5.6 percent of employees' salaries, compared with the current 6 percent. The system is requesting that the state increase its contribution to 7.19 percent." (Star; one-time registration required)

Employees Are Urged to Prepare for No-Pension Retirements
Excerpt: "As workers make their retirement calculations, they should keep in mind the two, sometimes opposing, principles that govern the U.S. pension system and that the new law, the Pension Protection Act, reaffirmed: An accrued pension can't be wiped out, but companies can walk away from promised future benefits at any time. That means workers who still have pensions will have to do more homework to determine how much money their plans are likely to provide, experts say." (The Post via The Day)

Overview: Department of Labor Proposed Revisions to Form 5500
Excerpt: "[A] new two page Short Form 5500, the Form 5500-SF . . . would be available to pension and welfare plans if the plan; has fewer than 100 participants or would be eligible to file as a small plan under the 80-120 rule, is eligible for the small plan audit waiver, holds no employer securities, and has 100% of its assets in investments that have a readily ascertainable fair market value." (Winston & Strawn LLP)

Poll Shows That the Defined Benefit Landscape Keeps Changing
Excerpt: "An SEI news release said that 42% of US and Canadian plan sponsors polled said they were still committed to their DB pensions, but that they were nevertheless making 'significant changes' to the management procedures they use in running them." (; one-time registration required)

New Products Target Emerging Retirement Income Needs (PDF)
2 pages. Excerpt: "Some solutions are already in the market and well-known. Others are less well-known. Still others have yet to be developed. A theme running through all of the products is protection from the longevity risk -- the risk of outliving assets when living beyond retirement life expectancy." (National Underwriter via Milliman)

Tax Law Update, September 2006, with Effects on Retirement Plans (PDF)
3 pages. Excerpt: "In recent months, two tax bills have been passed that impact individual income taxation and the taxation of retirement assets such as IRAs and 401(k) plans – the Pension Protection Act of 2006 . . . and the Tax Increase Prevention and Reconciliation Act of 2005 . . . ." (von Briesen & Roper, s.c.)

Hewitt Federal Legislation Quick Guide Updated as of September 12, 2006, for Retirement Plans (PDF)
8 pages. This Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding retirement plans. (Hewitt Associates)

Links to Items on Executive Comp, Benefits in General

No Statutory Penalties Where Document Request Was Not Made to Plan Administrator
Excerpt: "EBIA Comment: As this case illustrates, it is the plan administrator, which is not necessarily the employer, that will be liable for statutory penalties for failure to furnish requested documents. However, while this court rejected the participant's de facto plan administrator argument, other courts, including those in the First, Seventh, and Eleventh Circuits, have concluded that employers not designated as plan administrators may be subject to statutory penalties . . . ." (Employee Benefits Institute of America Inc.)

Richard D. Quinn on Why Concept Communications Are Critical
Excerpt: "I don't understand why many employers leave employee benefit communications to a few facts, enrollment material, and little more. Is it because that's all they are required to do?" (Employee Benefit News)

New Proxy Disclosure Rules Generating Lots of Questions
Excerpt: "No one ever said the SEC's new proxy disclosure requirements for executive compensation would be easy to implement. The final published rules are 436 pages long, and they're prompting a flood of questions from employers. Here's a summary of . . . responses to eight frequently asked questions dealing with the objectives, effective date and other key aspects of the new rules." (Towers Perrin)

Chart: Comparison of SEC Rules on Compensation Disclosure (PDF)
45 pages. Excerpt: "This chart compares the new final SEC rules on Compensation Disclosure adopted on July 26, 2006 with both the prior rules and proposed rules. This chart has been designed as a companion to Baker & McKenzie's client alert on the final rules (available at . . . ." (Baker & McKenzie)

Mistake in Calculation Made by Non-Fiduciary Is Not a Breach of Fiduciary Duty
Excerpt: "EBIA Comment: This case illustrates that a mistake isn't necessarily a breach of fiduciary duty, even when large sums of money are at stake. As long as plan fiduciaries choose and monitor any nonfiduciary service providers as required by ERISA, ministerial errors made by those service providers should not result in fiduciary liability." (Employee Benefits Institute of America Inc.)

Federal Court Rulings Identify Employers As Liable Party in ERISA Benefits Action
Excerpt: "In Bernstein v. Citigroup Inc., the U.S. District court for the Northern District of Texas refused to dismiss a claim brought by a retiree under Section 502(a)(1)(B) of the Employee Retirement Income Security Act against his former employer, Citigroup Inc." (Employee Benefit News)

We thank and invite your attention to our additional sponsor: RELIUS® Education – Seminars and Conferences for Pension Professionals

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2007 Advanced Pension Conferences

While you're budgeting for 2007, remember to include the Relius Advanced Pension Conference. Scheduled twice each year, this established pension conference is one of the best ways you can stay up-to-date with the most recent and important topics surrounding retirement plans, including the Pension Protection Act of 2006. Our panel of experts led by program Chairman and Moderator, Craig Hoffman, share their knowledge and experience on each important topic. The program agenda offers general sessions, twelve concurrent sessions, as well as the very popular and informative "Ask the Experts". Keeping your industry knowledge current is important in this competitive market. Make the Relius Advanced Pension Conference a must-attend event in 2007.

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)

Newly Posted Events
(Post Yours!)

A Legislative Update for Public Sector Retirement Plans - Teleweb
Nationwide on September 27, 2006
presented by International Foundation of Employee Benefit Plans

Flood of Fiduciary Breach Class Actions Challenging Defined Contribution Plan Expenses
Nationwide on October 10, 2006
presented by Paul, Hastings, Janofsky & Walker LLP

Newly Posted Press Releases
(Post Yours!)

NIPA Welcomes Martin to Leadership Team as Educational Director
(National Institute of Pension Administrators)

New Research Shows Personalized Education Dramatically Increases Employees’ Perceived Value Of Stock Option Awards
(Ameriprise Financial)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

401(k)/Defined Contribution Valuation Processor
for National Retirement Services, Inc.
in CA, NC

Plan Administrator for Retirement Plan & ERISA Specialists
for Dana Consulting Group
in IL

Tax/Employee Benefits Attorney
for Harter, Secrest & Emery LLP
in NY

401(k) Administrator
for BMI
in MO

EB Trust Administrator
for BB&T (Branch Banking and Trust )
in NC

Employee Benefits Consultant – Become our Daily Valuation Expert!
for Clifton Gunderson LLP
in IL

Daily Operations Clerk - Mail
for Laborers' National Pension Funds
in DC

Defined Contribution Administrator
for Creative Plan Designs, Ltd.
in FL, NY

Qualified Plan Administrator
for Creative Plan Designs, Ltd.
in FL, NY

Defined Contribution Plan Administrator
for W&W Actuarial Services, Inc.
in PA

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