Retirement Plans Newsletter

January 27, 2017 logo logo
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Employee Benefits Jobs

Retirement Plan Consultant
Intac Actuarial Services
in NJ, NY

Pension Administrator
IPD Inc.
in NY

Employee Benefits Associate - Entry Level
Hanson Bridgett LLP
in CA

ESOP Administrator
Blue Ridge ESOP Associates
in VA, Telecommute

Senior Retirement Education Specialist
CUNA Mutual Group
in AR, KS, LA, MO, OK, TX, Telecommute

Associate Portfolio Specialist - Target Date
T. Rowe Price
in MD

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Webcasts and Conferences

36th ECFC Annual Conference
March 8, 2017 in DC
ECFC [Employers Council on Flexible Compensation]

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[Guidance Overview]

SEC Extends Rule 482 Relief to Non-ERISA Retirement Plans
"While Rule 482 under the Securities Act permits information about investment companies to be provided to investors without being accompanied or preceded by those companies' full prospectuses, DOL-required disclosures did not comply with all the conditions for reliance on Rule 482. Nevertheless, the SEC staff issued a no-action letter in late 2011 under which it agreed, for ERISA plans, to treat the DOL-required disclosures as if they satisfied the conditions of Rule 482. The SEC staff's February 18 letter extends that position to cover provision of the same disclosures required by the DOL rule to participants and beneficiaries in plans that are not subject to ERISA, thus permitting reliance on Rule 482 for such disclosures."
Carlton Fields


Techniques to Enhance Your 401(k) Plans

Sponsored by Lorman and BenefitsLink

Jan. 31 webinar. Fiduciary process and techniques of automatic enrollment, auto escalation, re-enrollment, Qualified Default Investment Alternatives, hiring and monitoring of service providers, benchmarking, investment due diligence, regulatory issues.

IRS Exempts Some Small Employer Plans from User Fee for Determination Letter Applications
"Effective January 1, 2017, the [IRS] ... said that to simplify eligibility for user-fee exemptions, an application for a determination letter related to a pension, profit-sharing, stock bonus, annuity, or employee stock ownership plan (ESOP) maintained by a small employer will be treated as being filed within a qualifying open remedial amendment period if the plan didn't exist before January 1 of the 10th calendar year before the year in which the application is filed.... Small-employer plans are defined by the IRS in the notice as having no more than 100 employees."
HR Daily Advisor

Six Month DOL Rule Delay Expected Within Days
"Bradley Campbell, of Drinker Biddle & Reath [said] 'The rumors that we're hearing are that the first action will be to delay the rule for about six months and then do a formal notice of comment for a longer delay, say a year, and a notice of comment on repealing or modifying the rule.' "

JPMorgan Sued for Alleged Self-Dealing in Its 401(k) Plan
"The plaintiff claims JPMorgan, as well as various board and committee members with oversight of the $21 billion retirement plan, breached their fiduciary duties by ... retaining proprietary mutual funds from the bank and affiliate companies for several years, despite the availability of nearly identical, lower-cost and better-performing funds."

401(k) Plans Make Big Fund Changes Following New Money Market Rules
"The [SEC's] rules, which came into force in October, instituted new investor safeguards for money market mutual funds that included special fees and redemption restrictions, as well as a floating net asset value.... 64% of plan sponsors either changed to a different money market fund or eliminated their money fund altogether within the past two years, largely because of the rules."


Online Learning Course: ERISA

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

Get the information you need to understand the requirements of ERISA, including penalties, vesting requirements, fiduciary responsibilities, plans covered by the PBGC, and the roles of the various enforcement agencies.

Using Science to Reach Participants and Inspire Positive Actions
"How do we get participants' attention to help them get on track toward retirement and then stay there amid all the noise?... [1] Create an individualized experience for each participant. [2] Provide a clear recommendation for increasing retirement readiness. [3] Use proven communication techniques."

Public Pension Funds Continue to Recover from Recession
"The average funded level of the surveyed plans has increased from 71.5 percent in 2014 to 74.1 percent in 2015 to 76.2 percent in 2016.... [W]hen looking at returns from the past 3 years (8.6%), 5 years (8.3%), and 20 years (7.9%), the pension funds have achieved returns close to or exceeding 8 percent. When looking at the past 10 years, the investment rate of return was 6.2 percent ... [M]any are lowering their actuarial assumed rate of return to account for continued weakness in the market."
National Public Pension Coalition

California Court Affirms that PEPRA Does Not Limit County's Right to Repeal COLA Pickup
"[T]he San Joaquin County Correctional Officers Association (CCOA) argued that PEPRA shielded its members, by prohibiting the County from eliminating a pension 'pickup' prior to 2018. The Court ... found that the County could eliminate the pickup at any point, as long as it did so in accordance with collective bargaining laws." [San Joaquin County Correctional Officers Assoc. v. County of San Joaquin, No. C079413 (Cal. App. Dec. 20, 2016)]
Liebert Cassidy Whitmore

CalSTRS May Set State and Teacher Rates for the First Time
"Actuaries are recommending that one of the state's oldest public pension systems, the California State Teachers Retirement System formed in 1913, lower its investment earnings forecast from 7.5 percent to 7.25 percent. If the newly empowered CalSTRS board adopts the lower forecast next week, state rates paid to the pension fund would increase by 0.5 percent of pay, an additional $153 million bringing the total state payment next fiscal year to $2.8 billion.... The new rate-setting power is sharply limited. But it's a big change for CalSTRS which, unlike nearly all California public pension funds, has lacked the power to raise employer rates, needing legislation instead."


Tax Reform Blueprint Spells Potential Disaster for Small Biz Retirements
"[T]he House Blueprint for tax reform provides a 25% tax rate on income from pass-through entities (partnerships, S corps and small business limited liability corporations).... [But] retirement distributions are subjected to ordinary income tax rates -- and for many successful small business owners, even under tax reform, that could be a 33% tax rate ... As a result, owners of pass-through entities, which are mostly small businesses, will have no incentive to defer current income in the form of retirement plan contributions."
Nevin Adams, for American Society of Pension Professionals & Actuaries [ASPPA]

Benefits in General

[Official Guidance]

Text of IRS Disaster Relief Announcement ATL-2017-03: For Victims of Severe Storms, Tornadoes and Straight-Line Winds in Georgia
"Victims of the severe storms, tornadoes, and straight-line winds that took place beginning on January 2, 2017 in parts of Georgia, may qualify for tax relief from the [IRS].... Individuals who reside or have a business in Dougherty County may qualify for tax relief.... [C]ertain deadlines falling on or after January 2, 2017, and before May 31, 2017, are granted additional time to file through May 31, 2017.... This relief also includes the filing of Form 5500 series returns (that were required to be filed on or after January 2, 2017, and before May 31, 2017)[.]"
Internal Revenue Service [IRS]

Ford Takes a $2 Billion Charge Due to Pensions, Benefits
"The automaker is changing how it values pensions and other retiree obligations and is now counting them in the year they were incurred instead of spreading out the impact over a number of years."

White House May Favor Cutting Federal Employee Retirement, Health Benefits
" 'Federal employee health and retirement benefits continue to be based on antiquated assumptions and require a level of generosity long since abandoned by most of the private sector,' [White House Press Secretary Sean Spicer] said. 'Those costs are unsustainable for the federal government, just as they are proving to be unsustainable for state and local governments with similar health and retirement packages.' "
Government Executive

Possible Supreme Court Pick Hardiman Offers Pro-Worker ERISA Streak
"Since his appointment to the U.S. Court of Appeals for the Third Circuit in 2007 by President George W. Bush, Judge Thomas M. Hardiman has signed on to several decisions favoring workers who attempt to enforce their rights under [ERISA]. He's twice joined opinions offering a broad view of ERISA standing in disputes over medical payments, and in 2015 he added his name to a decision placing the burden of demonstrating administrative exhaustion on plan administrators rather than the participants challenging denied benefits."
Bloomberg BNA

Press Releases

Fiduciary Investment Advisors Announce Employee Promotions
Fiduciary Investment Advisors, LLC [FIA]

Connect   LinkedIn logo   Twitter logo   Facebook logo, Inc.
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Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2017, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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