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January 15, 2009

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


Today's sponsor is ASPPA

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Banner ad for ASPPA

The ASPPA 401(k) SUMMIT, March 22- 24, 2009

Register now and be a part of this unique forum for retirement sales and investment professionals in the 401(k) arena. Hear Arthur Laffer discuss the condition of our new global economy, participate in interactive networking activities and specialized education tracks, and listen to our industry’s leaders discuss where the trends are taking us and how to be prepared. Don’t miss out on the longest running event dedicated solely to the sales and investment segment of our industry, register now.

[Guidance Overview]
Temporary Pension Funding Relief

Excerpt: "President Bush recently signed into law the 'Worker, Retiree, and Employer Recovery Act of 2008,' which includes technical corrections to the Pension Protection Act of 2006 and certain 'Pension Provisions Relating To Economic Crisis.' Here we highlight and review key pieces of the legislation affecting retirement plans." (JPMorgan Chase & Co.)


[Guidance Overview]
FASB Requirement of Additional Asset Disclosures for Pension and OPEB Plans (PDF)

3 pages. Excerpt: "The Financial Accounting Standards Board (FASB) issued on December 30, 2008 a staff position requiring sponsors of defined benefit pension plans and other postretirement benefit plans (OPEBs) to disclose additional information about their plans' invested assets. The additional disclosures are required for fiscal years ending after December 15, 2009, with prospective application only and earlier adoption permitted." (Buck Consultants)


[Guidance Overview]
PBGC's PPA Guidance on Applying Minimum Lump Sum Changes in Standard Terminations

See 'Items of Interest' listing on the target page. Excerpt: "The Technical Update states that the 'guidance represents PBGC's current thinking on this topic,' and 'does not create or confer any rights for or on any person or operate to bind the public.' It goes on to note that, '[i]f an alternative approach satisfies the requirements of the applicable statutes and regulations, you can use that approach,' and that '[i]f you want to discuss an alternative approach (you are not required to do so), you may contact the PBGC.'" (http://www.keightleyashner.com/main.htm)


Fee Transparency and Investment Neutrality in Retirement Plans (PDF)
5 pages. Excerpt: "Retirement plan sponsors have important fiduciary responsibilities to plan participants. Understanding plan expenses and determining if they are reasonable are among the most important. For plan sponsors, it's critical that expenses are transparent (i.e., well-disclosed and easy to understand) and prudently applied to participants. Emphasis must be on minimizing or eliminating potential conflicts of interest and allocating expenses fairly. Historically, some fee structures have lacked clarity, adequate disclosure, or both. These structures frequently favor one or a group of investment options, and create often hidden incentives to drive plan assets into these options, regardless of investment merit." (Securian Retirement)


Audio: Why Pension Funds May Be the Next to Collapse
Excerpt: "Alex Cohen talks to reporter Jon Entine about why he thinks pension funds are the next domino to fall." (Day to Day via National Public Radio)


Employers Need to Triple Pension Funding in 2009
Excerpt: "Under federal funding law, employers in 2009 will be required to contribute $108 billion to their plans compared with just $38 billion in 2008." (Workforce Management; free registration required)


Defined Contribution Compliance Issues
Excerpt: "[W]e explore how employers can use old-fashioned defined contribution plans to provide additional retirement benefits in conjunction with 401(k) plans. Here, we examine compliance issues for these plans, particularly highlighting those that differ by plan structure." (JPMorgan Chase & Co.)


The PPA and Market Turmoil -- Selecting and Changing Funding Methods
Excerpt: "How does you[r] actuary value your plan's liabilities? How does your actuary value your plan's assets? In the new world of PPA and its amendments by WRERA, there are many choices to be made. In this article, we explore those choices, as well as some as yet unresolved questions on the topic." (JPMorgan Chase & Co.)


Listing of IRS Published Guidance for January - December 2008
The target page links to guidance published by the Service relating to retirement plans: Treasury Regulations; Revenue Rulings; Revenue Procedures; Notices; and, Announcements. (Internal Revenue Service)


PBGC Announces January-March 2009 Interest Rates for Valuing Benefits
Excerpt: "The PBGC has announced the interest rates for valuing benefits of terminating single-employer plans and for valuing benefits and assets under ERISA §4044 for January 2009 through March 2009. The interest rate to be used in valuing benefits of single-employer or multiemployer plans for valuation dates during January, February, and March 2009 will be 6.02%, which represents a decrease from the December 2008 rate of 7.92%." (Wolters Kluwer)


31 Companies That Have Cut or Changed Their 401(k) Match
Excerpt: "[These companies also] cut their 401(k) match during the last recession. Most firms resumed employer contributions when their bottom line improved." (U.S. News & World Report)


PBGC Will Represent Government in Madoff Liquidation Proceedings If a Pension Has Failed As Result of Madoff-Related Losses
Excerpt: "The nation's private-sector pension insurer told a bankrup.tcy judge that it would represent the government in liquidation proceedings against Bernard Madoff's investment company if a pension failed as a result of Madoff-related losses. A Reuters news report said the Pension Benefit Guaranty Corporation (PBGC) filed papers in the U.S. Bankrup.tcy Court for the Southern District of New York to secure its position as a creditor so it could act to recover any available assets for a failed plan." (PLANSPONSOR.com; free registration required)


[Opinion]
Senior Pension Fund Managers Work with Blinders on and Nobody Is Connecting to the 'Big Picture'

Excerpt: "[T]he problems in pension funds run much deeper than socially responsible investing, which can be done properly. There are huge governance gaps that need to be addressed, making pension funds more transparent and making their supervisors and managers more accountable for the decisions they undertake." (Leo Kolivakis)


[Opinion]
The Word 'Pandemic' Describes the Current Global Pension Crisis

Excerpt: "In March 2009, when pension fund managers, pensioners and governments will become simultaneously aware of the fact that the crisis is there to last, that it coincides with the - baby-boomer - generation's age of retirement and that the markets will not resume their 2007 levels until many long years (9), chaos will flood this sector and governments will reach the moment when they will be compelled to nationalize all these funds. And Argentina, who took this decision a few months ago already, will appear a pioneer." (Leo Kolivakis)



DATAIR Employee Benefit Systems, Inc. (Sponsor)

(Click on company name or banner to learn more.)
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Links to Items on Executive Comp, Benefits in General

Recent Developments in Four States Regarding Same-Sex Marriage and Civil Unions (PDF)
3 pages. Excerpt: "Following the changing developments in same-sex marriage and civil union laws is important for employers, plan sponsors, and insurers to ensure that benefit plans comply with state and local laws that are not preempted by ERISA. Generally, insured benefit plans will be required to cover same-sex spouses, and self-insured plans, because of ERISA preemption, may elect whether to cover same-sex spouses. Employers may also be interested, for plan design purposes, in what benefits other employers are offering to same-sex spouses and partners. [W]e briefly summarize recent developments in California, Connecticut, New Hampshire, and New York regarding same-sex marriage and civil unions." (Groom Law Group)


How Do Federal Employees Rate Their Pay and Benefits?
Excerpt: "The 2008 Federal Human Capital Survey results released last week indicated that while employees are fairly satisfied with pay, health insurance benefits and paid time off, they have more lukewarm opinions of other programs -- such as long-term care insurance, flexible spending accounts, telework and alternative work schedules." (GovernmentExecutive.com)


Growth in Federal Entitlement Programs Outpacing Tax Revenues, Treasury Department Reports
Excerpt: "[T]he largest contributors to government's net cost are the Department of Health and Human Services (19.6%), the Department of Defense (20.3%), the Social Security Administration (18.2%), and interest paid on debt held by the public. Federal employees' and veterans' benefits payable in 2008 have exploded from $90.1 billion in 2007 to $549.8 billion." (Wolters Kluwer)


Number of ERISA Class Action Suits Expected to Increase
Excerpt: "If 2008's figures on ERISA and FLSA lawsuits are any indication, employers can expect even more legal filings this year, as employees continue to lose their jobs in the economic recession, predicts international law firm Seyfarth Shaw. According the 5th Annual Workplace Class Action Litigation Report compiled by Seyfarth Shaw, the top ten ERISA class action settlements entered into or paid in 2008 totaled $17.7 billion, up from the $1.818 billion settlement tally of the previous year." (Employee Benefit News; free registration required)


Testimony: A Framework for Crafting and Assessing Proposals to Modernize the Outdated U.S. Financial Regulatory System (PDF)
30 pages. Excerpt: "[The statement is based on the GAO report, 'Financial Regulation: A Framework for Crafting and Assessing Proposals to Modernize the Outdated U.S. Financial Regulatory System'], which (1) describes how regulation has evolved in banking, securities, thrifts, credit unions, futures, insurance, secondary mortgage markets and other important areas; (2) describes several key changes in financial markets and products in recent decades that have highlighted significant limitations and gaps in the existing regulatory system; and (3) presents an evaluation framework that can be used by Congress and others to shape potential regulatory reform efforts." (U.S. Government Accountability Office)




Newly Posted Events

403(b) Plan Documents Webcast
Nationwide on January 21, 2009
presented by ftwilliam.com

TRI-AD's Free Web Seminars: Legislative Updates for Retirement Plans and Health & Welfare Plans
in California on January 22, 2009
presented by TRI-AD

Update On State And Local Legislation Affecting Employers And The Uninsured
in Maryland on February 5, 2009
presented by Worldwide Employee Benefits Network (WEB) - Baltimore Chapter



Newly Posted Press Releases

Study Examines Issues in Capping Tax Exclusion of Health Coverage
Employee Benefit Research Institute (EBRI)

Reminder for Funding Opportunity: Dissertation Fellowship
Center for Retirement Research at Boston College

Middle-Income Americans Benefit from 401(k) Plans
American Society of Pension Professionals & Actuaries (ASPPA)



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Corporate Retirement Services Supervisor
for Fiserv ISS
in CO

Taft-Hartley Relationship Manager
for New York Life Retirement Plan Services
in MA

Business Analyst - OmniPlus
for Recruiting & Placement firm
in CO, CT, GA, KS, MA, NC, NJ

Client Service Consultant
for The Standard
in IL

Senior Retirement Plan Analyst and Supervisor
for Mid Size New York City TPA
in NY

ERISA Attorney
for Law Offices of Gary V Webster
in TN

Retirement Plan Administrator
for The Paragon Alliance Group
in PA

Education Coordinator
for Milliman
in TX

Consulting Actuary
for Van Iwaarden Associates
in MN

Pension Administrator
for Retirement Strategies Inc.
in GA




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