Retirement Plan Administrator
for MVP Plan Administrators, Inc. in NC

ERISA/Employee Benefits Attorney
for Dinsmore & Shohl, LLP in DC, KY, OH

Communication/Education Specialist
for Benefit Plans Administrative Services (BPAS) in PA

Vice President, Plan Compliance Services
for Prudential in CT, IA, NJ, PA

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Webinar: Supreme Court Decision on Health Care Reform Law
Nationwide on June 28, 2012 presented by Seyfarth Shaw LLP

Pension Funding Relief, PBGC Premium Hikes Part of Student Loan Bill Negotiations
"Corporate plan sponsors could use a funding rate 'stabilization range' within a 25-year period, instead of current bond rates as mandated by the Pension Protection Act of 2006. For 2012, that means that segment rates used to calculate contributions could be within 10% of a 25-year average of prior segment rates. After this year, the 10% would increase 5% each year until stopping at 30% in 2016, and then becoming permanent." (Pensions & Investments)

Attend the 2012 Western Benefits Conference   [Advert.]

Designed for retirement, health, welfare & benefits professionals, with particular emphasis on practical issues important to plan sponsors & their advisors. Speak with nationally-renowned speakers & government representatives and more!

Lifetime Income Features in Retirement Plans (PDF)
"[S]ignificant attention is now being given to how to help employees manage their 401(k) plans to maximize the likelihood that their retirement savings will last through their retirement years. A key feature of this attention has been a focus on how lifetime income features can play a role in the modern retirement plan system. This focus has involved both innovative product designs from the private sector and a joint February 2010 request from the Departments of Labor and Treasury for information (RFI) regarding lifetime income options." (Groom Law Group)

Quarterly Retirement Market Data, First Quarter 2012
"Total U.S. retirement assets were $18.9 tril.lion as of March 31, 2012, up 6.3 percent from $17.8 tril.lion recorded on December 31, 2011. The increase in retirement assets was driven in part by the rise in corporate equity values—for example, the S&P 500 Total Return Index grew by 12.6 percent in the first quarter. Retirement savings accounted for 36 percent of all household financial assets in the United States at the end of the first quarter of 2012." (Investment Company Institute)

Quarterly Survey of Public Pensions - State and Local Governments, First Quarter 2012
"The Quarterly Survey of Public Pensions is a quarterly survey that provides national summary data on the revenues, expenditures, and composition of assets of the largest defined benefit public employee retirement systems for state and local governments. This survey currently consists of a panel of 100 retirement systems, which comprise 89.4 percent of financial activity among such entities, based on the 2007 Census of Governments." (U.S. Census Bureau)

Services and Products of RIAs and Insurers Converging
"For clients of fee-only financial advisers, guaran.teed-retirement-income options historically have been few and far between. Insurers traditionally have focused on building products structured for commission-based sales, leaving many fee-only advisers with a negative impression of these products. But with the registered investment advisory marketplace now managing $1 tril.lion in client assets — and with client demand for retirement income increasing — products and services designed for RIAs are evolving to meet new market demands." (Investment News; free registration required)

Managing your 401(k) Plan: A Day in the Life of a Healthy 401(k) in 2012   [Advert.]

Live audio conference: identify and address major trends and challenges facing 401(k) plan sponsors in maintaining a benefit plan that will meaningfully prepare their employees for retirement. Discounted price for BenefitsLink readers.

IRS Releases Offshore Voluntary Disclosure Program, Including Foreign Retirement Plans
"There are also new procedures for taxpayers who have foreign retirement plans (such as Canadian Registered Retirement Savings Plans) to resolve certain issues. In some circumstances, under tax treaties these plans qualify for income deferral if a timely election is made. The "streamlined procedures" help taxpayers who failed to make the election" (Journal of Accountancy)

Insights on Investing: Fixed Income Options Within DC Plans (PDF)
"[I]t is not surprising that today's defined contribution (DC) investment menus typically include numerous equity choices but only a few fixed income offerings. This may no longer be prudent. The shift from defined benefit (DB) plans to DC plans as the primary workplace retirement offering has left individuals with more responsibility not only for saving for retirement, but also for transforming their savings into a sustainable stream of income once they stop working. Today's equity-heavy investment menus may not be up to this task." (Prudential)

Estimated Revenue Effects of the Highway Investment, Job Creation, and Economic Growth Act of 2012
Chart describing the estimated effects on revenue for years 2012-2022 of this Act, which includes pension funding stabilization provisions as well as increases in PBGC premiums. (Joint Committee on Taxation)

More Fixed-Income Options Could Help Participants
"One way to help participants have a successful retirement is strengthening the lineup of fixed-income offerings in the menu, Prudential's study said. According to the nonprofit Plan Sponsor Council of America, the average DC plan has 18 offerings in its investment menu, but only two or three are fixed-income funds. According to Prudential's report, about 56% of funds offered in DC plan menus are equity funds, followed by balanced funds (20%) and fixed-income funds (12%). The most common fixed-income offerings are domestic bond funds." (PLANADVISER.com)

Overview of Four Proposed State-Sponsored Retirement Plans for the Private Sector
The efficiencies of public retirement systems are attractive in designing new types of pension plans for private-sector workers. At the link are brief summaries of the plans being considered in California, Connecticut, Massachusetts and New York City. (Pension Rights Center)

What's Under the Hood of Your Target-Date Fund?
"There's nearly $400 bil.lion and growing invested in target-date funds, but these one-size-fits-all funds are neither as safe nor as simple as most people believe. A recent [SEC] survey ... reveals that 54 percent of investors don't realize that funds bearing the same target date, but offered by different companies, don't have the same asset mix. In reality, the allocations and risk levels of funds with identical dates can differ dramatically. In addition, the SEC found that only 36 percent of the investors surveyed understand that target-date funds do not provide guaran.teed income in retirement." (Reuters)

The Real Deal on Retirement Income Adequacy at Large Companies (PDF)
"[I]n light of growing deficits and economic difficulties, the country's social systems are at risk of becoming overwhelmed by retiring workers who are financially ill-prepared for retirement.... [This study looks at] the retirement resources and needs for 2.2 mil.lion employees of 78 large US employers. The study projects employees' retirement resources and needs assuming their current behaviors continue. The report then analyzes the risks, measuring employer and employee actions to help improve the outcome." (Aon Hewitt)

You Can't Eat Bonds: Big Pension Funds Ploughing Money Into Farmland
"Some of the world's biggest pension funds said they have been ploughing money into farmland around the world as they seek to diversify portfolios and generate stable returns at a time of market volatility. At an agriculture investment summit in London on Wednesday, leading U.S. and European pensions funds said few assets remained immune from whipsawing markets, prompting institutions to look at farmland. ... Farmland prices have rocketed to near or at record highs in several U.S. farm states. Research in the UK predicts British farmland will outperform gold, oil and residential real estate in London's most exclusive neighborhoods." (Reuters)

Mobile, Ala., Judge Sues State Officials Over Increase in Required Employee Contributions to Pension Plan
"A Mobile County judge is suing state officials to try to block a state law that requires all Alabama judges to pay more of their salaries toward their retirement benefits. The suit filed by Circuit Judge James Wood argues that the increase enacted by the Legislature last year violates a state Constitution prohibition against diminishing a judge's pay during his term of office. The law boosted the amount that judges must pay toward their pensions from 6% of their salary to 8.5%." (WTVM.com)

Florida Court Gives Go-Ahead for Miami Beach to Modify Pensions Without Voter Approval
"The [Florida] Third District Court of Appeal issued an opinion Wednesday that the city does not need voter approval to make changes to its pension fund—an issue that has been at the center of a dispute between City Hall and the fund's board for nearly two years. Commissioners, following the approval of union contracts, voted in November 2010 to ensure that newly hired officers and firefighters would accrue more modest pensions over longer periods, among other union-approved system tweaks. But the fund's board refused to change benefits provided by the system on the grounds that state law requires a voter referendum to amend a municipality's pension system." (Miami Herald)

Now Playing at a Theater Near You: 'Target Date Funds Devour Nation's 401(k)s!'
"By 2016, 55% of 401(k) participants will have their whole retirement accounts invested in a single target date fund, up from 24% last year. That startling prediction is contained in a 94-page report the Vanguard Group released this week detailing the savings and investing habits of 3.2 mil.lion workers participating in the more than 2,000 retirement plans it administers. It's not a stretch, considering that 64% of all new participants in these plans in 2011 chose to put all their contributions into a single target date fund. Vanguard expects that by 2016, 80% of new participants will make that choice." (Forbes)

Get Ready to Retire—You Need Eleven Times Your Annual Salary
"Eleven times your final working salary. That's how much an average worker needs beyond Social Security payments, from sources like personal savings and employer benefits, to pay for retirement at age 65, a new analysis from the benefits consultant Aon Hewitt finds. The estimate takes into account inflation and post-retirement medical costs. And it is based on the retiree continuing to maintain the same standard of living." (The New York Times; free registration required)

Colorado Employees' Retirement Fund Returns Exceed Benchmark
"Colorado Public Employees' Retirement Association, Denver, returned 1.9% for calendar year 2011, outpacing the policy benchmark return of 1.3%, according to the $38.3 bil.lion pension fund's recently released annual report. In comparison, the BNY Mellon median public fund returned 0.3% for the year; BNY Mellon's universe comprises 74 funds with total assets of $700 bil.lion." (Pensions & Investments)

Now It's the Democrats' Turn to Razz the DOL's Proposed Fiduciary Definition
"Although it may be months before the Labor Department releases a revised fiduciary-duty proposal, political pressure on the issue continues to increase. In a letter to Secretary of Labor Hilda Solis on Monday, 33 congressional Democrats admonished the agency about the cost-benefit analysis it is conducting on the rule, which would expand the definition of 'fiduciary' for anyone providing investment advice to retirement plans. The request for data issued by the Labor Department late last year indicates that the agency is seeking to limit investment education and information, according to the letter." (Investment News; free registration required)

Public Pension Plan Reforms Help Improve Finances, Still Provide Retirement Security for Workers
"These fact sheets update the case studies in Strengthening State and Local Government Finances: Lessons for Negotiating Public Pension Plan Reforms (September 2011). Governments include Iowa, Oregon, Vermont, Gwinnett County (GA), and Houston (TX)." (Center for State & Local Government Excellence)

The Savings Crisis of Working Americans: A Retirement Industry Call to Action (PDF)
"Where, exactly, are working Americans going to get enough income to replace 80% to possibly 100% of their career-end compensation so they can retire, remain self-sufficient and contribute to the costs of health care—and do so without falling into financial ruin or, at the very least, significantly changing their lifestyle?" (Legg Mason Retirement Advisory Council)

GASB Approves New Accounting Standard for Pension Plans
"The final statements largely reflect the requirements of the Exposure Drafts issued last year with a few significant changes. The basic changes retained from the Exposure Drafts are: Accounting and financial reporting have clearly been divorced from any contribution requirements, Balance sheet drives annual pension expense (instead of the reverse), Increased uniformity of actuarial methods, More timely information for users of financial statements, and Significantly more volatile annual pension expense." (Cheiron)

[Opinion]

Statement by ERISA Industry Council on Including Pension Stabilization and PBGC Premium Increase in Student Loan Bill
"ERIC applauds Congress for including pension stabilization provisions with legislation that prevents a student loan interest rate hike and extends transportation funding. ERIC remains adamantly opposed, however, to Congress including an increase in PBGC premiums." (The ERISA Industry Committee)

[Opinion]

Student Loan Deal Risks Taxpayer Pension Bailout
"[R]educed pension contributions, which are tax deductible, would increase corporate profits so much that it would increase federal corporate tax collections by about $7 bil.lion. That money would help offset the cost of the bill, but such a significant reduction in pension contributions should send a strong warning. If contributions to defined-benefit pension plans fall that much while pension benefit promises continue to be stable or to grow, someone else may end up paying the difference. And that someone else is almost certain to be the taxpayers." (The Heritage Foundation)

SEC Finalizes Rules for Compensation Committee and Adviser Independence (PDF)
"The principal changes in the final rules are: The definition of Committee includes, for certain purposes, members of the board of directors who oversee executive compensation on the board's behalf if there is no compensation committee or other board committee performing typical compensation committee functions; An additional independence factor is to be considered by the Committee when selecting an adviser; and The conflict of interest disclosure applies to a compensation consultant retained by management if the consultant's role is otherwise required to be disclosed under existing SEC rules." (Frederic W. Cook & Co., Inc.)

Uninsured and Fighting Blazes: Welcome to the Life of a Temporary-Status Federal Firefighter
"Thousands of federal firefighters charged with taming the blazes do not have health insur.ance.... Of all the jobs where you might want health insur.ance, firefighting near certainly ranks near the top of the list. Firefighters spend two-week shifts working 18 hour days in dangerous conditions. Some develop breathing problems due to smoke inhalation. But many federal firefighters are temporary employees, who only work six months out of the year ... Under federal regulations, temporary employees of the Forest Service do not receive benefits. That means no health care and no retirement pension." (The Washington Post; free registration required)

Stockton's Default Tied to Pensions and Big Stock Market Gamble
"[A muni bond portfolio manager looked at] expenditures for public safety, debt service, pension funding and other post-employment benefits. In a cross-section of 118 cities around the country with populations of between 150,000 and 400,000, the median expense of those four combined categories represented 72.6% of general fund expenses. In a smaller group of 27 California cities, which like the larger group included Stockton, the median expense of the four categories was 76.7% of general fund expenses. In the case of Stockton, a city of nearly 300,000, the four categories account for 95.7% of general fund expenses." (Investment News; free registration required)

Hot Topics in Employee Benefits (PDF)
Excerpt: "Presentation materials from June 27, 2012 webinar, 'Hot Topics in Employee Benefits—What We're Seeing,' which featured updates on hot topics or trends you should be following." (Morgan, Lewis & Bockius LLP)

Miller Chevalier Focus on Employee Benefits, June 27, 2012
This issue includes: ERISA and tax rules on medical loss rebates; New tax guidance on tips and service charges; Impending limits on health FSAs; Deductibility of local lodging expenses (Miller Chevalier)

Hodgson Russ Employee Benefits Developments, June 2012
Monthly newsletter; this issue includes a discussion of recent IRS Proposed Regs that permit deduction for local lodging expenses, and coverage of recent ERISA and benefits court cases, including articles titled: COBRA Election Notice Failure Results in Statutory Damages, Transgender Spouse Reinstated as an Eligible Plan Participant, Keogh Plan With Qualification Defects Found to be Exempt From Bankrup.tcy Estate, Court Upholds Plan Administrator's Valuation Decision for Plan Distribution, Severance Denied to Employee Who Retired Following Expiration of Medical Leave, and Presumption of Prudence Defeats Stock Drop Case. (Hodgson Russ LLP)