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May 8, 2008

Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy.

Today's sponsor is SunGard

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SunGardís Relius Government Forms 5500 Web Client

Did you know the DOL is requiring electronic filing for 5500s? Now is the time to encourage your clients to use the Internet to gather and verify data. SunGard's Relius Government Forms 5500 Web Client can help.

Learn more.

800-326-7235, ext. 1100.

[Official Guidance] May 2008 Pension Funding Segment Rates
Generally for plan years beginning after 2007, the rates in the tables . . . apply for minimum funding requirements under section 430 of the Code. (Internal Revenue Service)

[Official Guidance] IRS 30 Year Treasury Securities Rate Updated for April 2008
30 Year Treasury Securities Rate for April 2008: 4.44% (Internal Revenue Service)

[Official Guidance] IRS Composite Corporate Bond Rate Table Updated for May 2008
Corporate Bond Weighted Average Interest Rate = 6.00 for May 2008 (Internal Revenue Service)

[Guidance Overview] IRS's Plan Valuation Regulations for Single-Employer Defined Benefit Plans (PDF)
Excerpt: "These developments affect sponsors of and participants in qualified single-employer and multiple employer defined benefit plans. They do not affect multiemployer plans, governmental plans or church plans that do not elect to be covered by ERISA ('non-electing church plans')." (Prudential Retirement)

[Guidance Overview] DOL Clarifies 'Qualified Default Investment Alternative' Requirements
Excerpt: "The Department of Labor has modified the final qualified default investment alternative (QDIA) regulations to: (1) expand the definition of 'stable value funds' which are entitled to grandfathered fiduciary relief, (2) explicitly allow a committee of the plan sponsor to manage the investment of a QDIA, and (3) delete the 'round trip' restriction from those prohibited under the regulations." (Deloitte via

IBM to Increase Pension Payments for Some Retirees
Excerpt: "Yes, it's true IBM Corp. plans to raise certain retiree pension payments. But not all the details are worked out yet, because the raise is 'a work in progress,' said Doug Shelton, a spokesman in Armonk for IBM. The increase will affect about 42,000 retirees who retired before 1997. About half of those who retired before 1997 will be eligible. The goal is to raise payments to those who were not able to participate in the 401(k) plan." (

Advisors Providing Services to Arrangements Governed by ERISA Should Review Fiduciary Practices and Double-Check Professional Liability Insurance
Some areas advisors working with 401(k) plans might review include: Service agreements, vendor relationships and fees, documentation, and education and training. (Financial Advisor)

Employees See Incredible Shrinking 401(k)s in First Quarter 2008
Excerpt: "The good news for plan participants is that the second quarter is off to a strong start. The S&P 500 index recovered quickly and posted a 4.9 percent gain for the month of April, ending a streak of five consecutive negative months. Non-U.S stocks were up more than 5 percent in April, while emerging markets were up more than 8 percent." (Workforce Management; free registration required)

Predictive Factors for Retirement Timing
Excerpt: "The factors affecting the retirement behavior of U.S. workers deserve renewed research attention and deeper understanding given recent developments such as the shift to defined contribution plans and corresponding decline in defined benefit pension plans, ongoing and proposed Social Security reforms, the recent volatility in the stock and housing markets, and exploding health care costs for retirees and workers. This paper investigates the impact of factors such as health insurance coverage, retirement plan types and public policies on the retirement timing of older workers." (Watson Wyatt Worldwide; free registration required to access paper)

Senate Drops Airline Pension Provision from Aviation Reauthorization Legislation
Excerpt: "Senate Majority Leader Harry Reid (D-NV) last week maneuvered to remove an airline pension funding provision from legislation to reauthorize funding of the Federal Aviation Administration. . . . The airline pension provision has been controversial for over a year, and bogged down the FAA legislation. In September 2007, the Finance Committee added the provision to the FAA bill to modify the relief provided for nonfrozen airline pension plans in the Pension Protection Act of 2006. The PPA permitted commercial airlines that do not freeze their defined benefit plans to pay off their pension liabilities over 10 years, and permits those airlines to use an interest rate of six percent to calculate future plan asset earnings." (The ERISA Industry Committee)

Annuities in 401(k) Plans Gaining Momentum, Report Finds
Excerpt: "The use of annuities as an investment alternative within 401(k) plans will gain momentum as those approaching retirement seek to create guaranteed retirement income streams, according to a report by the Financial Research Corporation (FRC)." (Wolters Kluwer)

Growing Disparities in Life Expectancy - Effects on Social Security and Private Retirement Plans
Excerpt: "Aside from the obvious individual detrimental effects of the longevity gap, CBO's 'Growing Disparities in Life Expectancy' study found this gap could have considerable adverse effects on the solvency of Social Security and Medicare. CBO's study notes that increasing longevity has clear effects on Social Security and Medicare expenditures by increasing their costs." (Deloitte via

Best Practices for 403(b) Plans Information Sharing -- Minimum and Comprehensive Data Elements (PDF)
18 pages. Excerpt: "This document sets forth certain best practices with respect to the data elements for information sharing between 403(b) plan employers or employer representatives and vendors. The document also identifies a basic file convention layout. The document does not define best practices for: (1) the methods and frequency of data transmission, or (2) information sharing with respect to specific plan transactions or events (e.g., loans)." (The Spark Institute)

Sample 403(b) Plans' Information Sharing Agreement
13 pages. Excerpt: "The sample ISA provides: A set of sample contractual provisions, with [bracketed alternative or optional text] and italicized user notes, and A list of the data elements and information which SPARK Institute members have collectively agreed upon as minimally necessary for issuers and vendors to exchange." (The Spark Institute)

Sponsored by: Investment Company Institute

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June 3rd ICI Conference on DC Plans in the PPA Era

Register today for the Investment Company Institute's June 3rd conference on legal and business issues for 401(k) plans, 403(b) plans, and IRAs. Speakers include senior representatives from the Departments of Labor and Treasury and the mutual fund industry. Topics include:
  • DOL's 401(k) plan fee disclosure agenda and fee-related developments
  • PPA implementation update
  • Participant notices and statements
  • The future of 403(b) plans

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

Links to Items on Executive Comp, Benefits in General

[Guidance Overview] Newly Minted Rules for Deducting Performance Compensation under Section 162(m) (PDF)
1 page. Excerpt: "The new ruling will not apply for performance periods beginning on or before January 1, 2009 or for compensation paid pursuant to employment contracts in effect on February 21, 2008 (excluding renewals, either automatic or by agreement)." (Hanson Bridgett LLP)

Several States Plan Cutbacks and Early Retirement Plans
Excerpt: "In Rhode Island, Gov. Donald L. Carcieri, a Republican, signed a spending plan last week that includes a provision to make state employees who retire after Sept. 1 pay more for their health insurance, a change that state officials say could prompt about 2,500 state workers to leave before the deadline." (The New York Times; free registration required)

Vallejo, California, Votes to Declare Chapter 9 Bankrup.tcy
Excerpt: "The city and its public safety unions have been at the bargaining table for about two years. The city is asking for its police and firefighters to take salary, benefit and staff cuts, while the unions say any further cuts would endanger public safety as well as the safety of the police and firefighters. Vallejo spends 74 percent of its $80 million general fund budget on public safety salaries, significantly higher than the state average." (San Francisco Chronicle)

Newly Posted Events
(Post Yours!)

401(K) Automatic Enrollment- Is It Right For Your Organization?
Nationwide on May 15, 2008
presented by Alexander Hamilton Institute

401(k) Plan Workshop
in New York on May 22, 2008
presented by SunGard Relius

401(k) Plan Workshop
Nationwide on May 22, 2008
presented by SunGard Relius

401(k) Plan Workshop
in North Carolina on May 22, 2008
presented by SunGard Relius

401(k) Plan Workshop
in Iowa on May 22, 2008
presented by SunGard Relius

401(k) Plan Workshop
in Wisconsin on May 22, 2008
presented by SunGard Relius

401(k) Plan Workshop
in Illinois on May 30, 2008
presented by SunGard Relius

401(k) Plan Workshop
in Ohio on May 30, 2008
presented by SunGard Relius

Form 5500 Workshop
in New York on May 21, 2008
presented by SunGard Relius

Form 5500 Workshop
Nationwide on May 21, 2008
presented by SunGard Relius

Form 5500 Workshop
in North Carolina on May 21, 2008
presented by SunGard Relius

Form 5500 Workshop
in Iowa on May 21, 2008
presented by SunGard Relius

Form 5500 Workshop
in Wisconsin on May 21, 2008
presented by SunGard Relius

Form 5500 Workshop
in Illinois on May 29, 2008
presented by SunGard Relius

Form 5500 Workshop
in Ohio on May 29, 2008
presented by SunGard Relius

Health and Welfare Plan Record Retention and Document Disclosures
Nationwide on June 18, 2008
presented by Lorman Education Services

Itís Time to Take Another Look at HIPAA Security Webcast
Nationwide on May 22, 2008
presented by International Foundation of Employee Benefit Plans

QDIA: What a Plan Sponsor Really Needs to Know Webcast
Nationwide on May 15, 2008
presented by International Foundation of Employee Benefit Plans

Return on Investment for Wellness Programs
Nationwide on June 4, 2008
presented by Lorman Education Services

Newly Posted Press Releases
(Post Yours!)

NIPA Honors Outstanding Volunteers at 2008 Annual Forum & Expo
National Institute of Pension Administrators

Xenia, Ohio, Woman Indicted for Theft from Quality Caulking Inc. Retirement Plan
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Miller & Chevalier Adds Anne Batter and Thomas Cryan, Jr. to Nationally Recognized Employee Benefits Practice
Miller & Chevalier

Major Initiative to Ease Health Care Workforce Crisis Receives Overwhelming Support
American Society of Association Executives

Employers May Now Be At Risk of Being Sued Over 401(k) Costs
Wealthcare Capital Management

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in WI

Premium Billing Supervisor
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in TX

Executive Assistant
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in CA

Client Consultant - Compliance / Technical - Fort Wayne, IN
for Lincoln Financial Group
in IN

Compliance Manager
for Vanguard
in AZ

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