Retirement Plans Newsletter

February 13, 2017 logo logo
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Employee Benefits Jobs

Business Relationship Consultant
Aspire Financial Services LLC
in FL

Contributions Supervisor
Aspire Financial Services LLC
in FL

DC Administrator
Creative Plan Designs, Ltd.
in NY

Employee Benefits Attorney
in OH

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Webcasts and Conferences

Science Behind Workplace Financial Wellness
February 15, 2017 in MO
Worldwide Employee Benefits Network [WEB] - St. Louis Chapter

Adding Financial Health to Your Wellness Program
March 8, 2017 in TX
Worldwide Employee Benefits Network [WEB] - Houston Chapter

Creative Uses of HSAs
March 31, 2017 WEBCAST
Lorman Education Services

New Parental Leave Laws in Rhode Island
April 27, 2017 WEBCAST
Lorman Education Services

Advanced Pension Conference - Chicago 2017
September 6, 2017 in IL
FIS Relius Education

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[Official Guidance]

Text of IRS Notice 2017-18: Update for Weighted Average Interest Rates, Yield Curves and Segment Rates, February 2017 (PDF)
"This notice provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under Section 417(e)(3), and the 24-month average segment rates under Section 430(h)(2) of the Internal Revenue Code. In addition, this notice provides guidance as to the interest rate on 30-year Treasury securities under Section 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate under Section 431(c)(6)(E)(ii)(I)."
Internal Revenue Service [IRS]


Certified Employee Benefit SpecialistŪ (CEBSŪ) program.

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

Take the first step by enrolling in the Certified Employee Benefit SpecialistŪ (CEBSŪ) program. Gain the knowledge you need to successfully lead your business through today's challenges. Learn more about the CEBS program and register.

[Guidance Overview]

Update on DOL Fiduciary Rule Applicability Delay and Litigation
"While there are many reports and speculation among the press regarding the length of the delay, we won't know any definitive details until the proposal is submitted for publication in the Federal Register [which will be after] the OMB completes its review and (presumably) approves the proposal ... A comment period will begin on the date the proposal [for delay] is published. Once the comment period closes, the DOL will review the comments and prepare a final rule, which it will submit to OMB. Assuming the OMB approves the final rule following its review, the DOL will publish the final rule in the Federal Register, formally adopting the new applicability date."
Morgan Lewis

New Wave of Retirement Fee Litigation: The University 403(b) Lawsuits
"The participant-plaintiffs ... allege that the universities and other fiduciaries of the plans failed to use the plans' billion-dollar negotiating power and, instead, paid unreasonable and excessive fees for recordkeeping, administrative, and investment services. The plaintiffs also allege that the fiduciaries selected and retained investment options that consistently and historically underperformed their benchmarks and charged excessive investment management fees."
Trucker Huss

How to Develop a Proper Plan Governance Procedure
"Identify individuals who have authority to make decisions on behalf of the plan.... Document, document, document.... Plan documents should contain appropriate provisions.... Follow procedures outlined in plan documents for amending/terminating plan benefits.... Training for plan fiduciaries.... Properly insure your plan fiduciaries."
Trucker Huss

GASB Statement 84 Provides 'Fiduciary Activity' Guidance for Governmental Entities
"[F]iduciary activity occurs when the governmental entity controls plan assets and has a fiduciary relationship with plan beneficiaries.... According to [GASB Statement 84], a government controls the assets of an activity if it holds the assets or 'has the ability to direct the use, exchange or employment of the assets in a manner that provides benefits to the specified or intended recipients.' ... The statement also includes separate criteria to identify fiduciary component units and postemployment benefit arrangements that are fiduciary activities."
Bloomberg BNA


The ERISA Fiduciary Compliance Guide

Sponsored by The National Underwriter Company

Authored by ERISA and employment law experts at The Wagner Law Group, this Guide is the practical reference you can rely on. Use code BENLINK for 10% discount.

Congress Poised to Halt State-Mandated Small Business Retirement Plans
"Employers fear the new plans will impose new state requirements (albeit employee-friendly ones) that are stricter that what's required under current federal law.... [S]tates are getting aggressive in designing plans to be employee-friendly -- and potentially making employers who already offer plans on their own to be subject to the state plan as well ... Oregon ... has a provision in proposed rules for its program that would allow a conditional exemption from the program for employers that provide a retirement plan to all employees -- only if the employer enrolls all employees within 90 days of hire."

Part-Time Work Trends Hurting Retirement Plans
"The Great Recession raised the part-time percentage of the labor force to just over 20% and it remains above 18% coming into 2017. Part-time work has a double negative effect on overall finances. In the short term, take-home pay is lower. In the longer term, part-time work is less likely to offer retirement benefits such as 401(k) plans that are crucial to building a suitable nest egg."

CalSTRS Cuts Misreported Pensions for Hundreds of Teachers
"Triggering at least two lawsuits, CalSTRS has cut the pensions of hundreds of retired teachers because extra work or pay was misreported as earnings for pensions, not for a 401(k)-style individual investment benefit with a guaranteed minimum return. An annual audit sample last year found overpayments to 87 retirees from 18 school districts totaling $237,854. The pensions of the retirees will be cut to the corrected amount and overpayments will be recovered by an additional 5 percent cut."

Jacksonville Police, Fire Unions Reach Tentative Pension Deal
"Police and firefighter union leaders came to a tentative agreement ... with Mayor Lenny Curry that paves the way for Jacksonville to become the first major city in America that offers only 401(k)-style plans to all future employees, and moves closer toward a plan that seeks to pay off the city's staggering $2.85 billion pension debt."


Public Pensions: Actuarial Assumptions and Professional Ethics
"The essential question is this: is there any set of actuarial assumptions for valuing public pension liabilities that would be so bad no ethical actuary could take that assignment? ... [A]lmost always those assumptions are given to the actuaries, when it's a public pension. Sure, the actuaries can make recommendations, and sometimes the real decision-makers will go along with it (or the actuaries give assumptions that the clients want to hear). But the actuaries act, essentially, as really expensive calculators when it comes to public pensions. It seems that the profession has no interest in trying to change that role."


Moving Maryland Workers Into a 401(k) Plan Would Harm Retirement Security
"Maryland Governor Larry Hogan recently proposed creating a 401(k)-style defined contribution plan for state employees. Future state employees would have the option of participating in this plan instead of the traditional defined benefit pension plan. Current state employees would not be able to switch to the new 401(k)-style plan and future teachers would not have the option to participate. The problem with the governor's plan is it would do nothing to address the unfunded liability in Maryland's pension system and would harm the retirement security of future state employees."
National Public Pension Coalition

Benefits in General

[Guidance Overview]

DOL, PBGC and HHS Increase Penalties for Violations (PDF)
"The DOL, PBGC, and HHS have announced annual inflation penalty adjustments.... The penalties listed [in this article] represent the maximums and minimums stated in associated laws and may not represent the penalty applied under administrative protocols established by an agency."

Executive Compensation and Nonqualified Plans

The 'Average' Non-Qualified Defined Contribution Plan (PDF)
"[A] recent review of 200 medium-to-large company non-qualified defined contribution plan design features ... found: 94 different types of eligibility provisions; 124 different company contribution allocation formulas; 95 plans with unique lineups of mutual funds as investment alternatives with 25 including company stock; 61 different vesting schedules."
NQDCSolutions, LLC

Press Releases

PBGC Announces Appointments
PBGC [Pension Benefit Guaranty Corporation]

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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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