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[Guidance Overview]
International Investments: Surprise Reporting Requirements for Plans and Fiduciaries (PDF)
Pages 1-4 of 8 pages. Excerpt: "Recent comments by representatives of the Internal Revenue Service ('IRS') indicate that benefit plans and their fiduciaries may now be required to report to the IRS what has become a staple of many plans' investment portfolios: the offshore investment fund. Investments which include foreign bank or securities accounts must be reported to the IRS on Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (the 'FBAR'), by the investor and anyone with signature or other authority over the investment. The FBAR for any calendar year ordinarily must be filed by June 30 of the following year. The IRS has temporarily extended this deadline to September 23, 2009 for certain investors who file an FBAR for 2008 and prior years. This article describes the FBAR filing requirements as they relate to plans, plan sponsors and service providers." (Trucker Huss)


[Guidance Overview]
SEC Moves to Eliminate Broker Discretionary Voting in Uncontested Director Elections
Excerpt: "On July 1, 2009, the Securities and Exchange Commission approved an amendment to New York Stock Exchange (NYSE) Rule 452 that eliminates broker discretionary voting in uncontested director elections. The amendment was approved by a 3-2 vote of the SEC Commissioners and, particularly when combined with other shareholder-rights initiatives, such as majority voting, could affect the election of public company directors. The SEC's approval of the amendment to NYSE Rule 452 is one of a series of actions the SEC has taken, or is contemplating, related to the proxy and shareholder voting process." (Faegre & Benson)


[Guidance Overview]
AK Steel Faces New Lawsuit on Whipsaw Calculation for Distributions
Excerpt: "A new lawsuit alleging AK Steel Corp. violated the Employee Retirement Income Security Act (ERISA) by failing to use a 'whipsaw' calculation in computing lump-sum distributions has been filed on behalf of union-represented employees who retired between July 1994 and August 2006. According to a BNA news report, the complaint alleges the company calculated the retirees' lump-sum distributions as being equal to the then-current cash balance amount held in the retirees' accounts, instead of using the two-step whipsaw calculation that was required of cash balance plans prior to the passage of the Pension Protection Act in 2006." (PLANSPONSOR.com; free registration required)


Pension Costs for New York State Local Governments May Triple
Excerpt: "Local governments in New York State face an unprecedented increase in pension costs that will force them to triple their contributions to the state pension system over the next six years, according to an analysis prepared by the comptroller's office. By 2015, pension costs borne by local governments upstate, on Long Island and in New York City's suburbs will exceed $8 billion a year, compared with $2.6 billion last year, under the analysis . . . ." (The New York Times; free registration required)


ERISA Advisory Council Meeting to be Held July 21-23, 2009
Excerpt: "The Advisory Council on Employee Welfare and Pension Benefit Plans (the ERISA Advisory Council) has announced an open meeting to be held on July 21-23, 2009. . . . The purpose of the open meeting is for Council members to hear testimony from invited witnesses and to receive an update from the Employee Benefits Security Administration (EBSA). The Council will study the following issues: (1) Approaches for Retirement Security in the United States, (2) Stable Value Funds and Retirement Security in the Current Economic Conditions, and (3) Promoting Retirement Literacy and Security by Streamlining Disclosures to Participants and Beneficiaries." (International Foundation of Employee Benefit Plans)


EBSA Soliciting Comments Concerning Information Collection for Three Multiemployer PTEs
Excerpt: "The Employee Benefits Security Administration (EBSA) is soliciting comments concerning the information collections incorporated in three related prohibited transaction class exemptions (PTEs) that apply to certain transactions involving collectively bargained multiple employer and multiemployer plans. Written comment are due on or before September 4, 2009. This request covers information collections contained in three related prohibited transaction class exemptions: PTE 76-1, PTE 77-10 and PTE 78-6. All three of these exemptions cover transactions that were recognized by the Department of Labor as being well-established, reasonable and customary transactions in which collectively bargained multiple employer plans (principally, multiemployer plans, but also including other collectively bargained multiple employer plans) frequently engage in order to carry out their purposes." (International Foundation of Employee Benefit Plans)


The Pros and Cons of the Obama IRA
Excerpt: "Tucked into President Obama's financial regulatory reform legislation still being debated in Congress is a proposal to get more workers saving for retirement. The plan calls for employers to set up mandatory automatic-enrollment IRAs, retirement accounts that allow for tax-deductible contributions. If the measure passes, companies that don't currently offer a tax-deferred retirement-savings plan would funnel employee contributions into IRA accounts through direct payroll deposits. It would also represent the biggest increase in new retirement savers since the creation of the 401(k) in 1980." (The Wall Street Journal)


Target Date Funds Increasingly Featured in 403(b) Plans, Survey Says
Excerpt: "Non-profit organizations are embracing target date funds and a majority of 403(b) plan sponsors have begun offering these funds in their plans, a study released [July 7] showed. The study, from the Chicago-based Profit Sharing/401k Council of America, found that 51% of 403(b) plan sponsors surveyed offered target date funds and nearly a quarter of organizations that did not offer them plan to do so within the year." (Investment News; free registration required)


Cash-Balance Plans Appeal to Small Firms
Excerpt: "Cash-balance plans are a type of defined-benefit plan governed by the Employee Retirement Income Security Act. They can be effective for high earners, particularly professionals, because they allow far more pretax dollars to be socked away than a traditional 401(k) or profit-sharing plan. 'They allow you to turbo-charge what you're putting away,' says Matthew Tuttle, a financial adviser in Stamford, Conn. In 2009, the maximum 401(k) contribution for someone under 50 is $16,500; it's $49,000 for a profit-sharing plan. In contrast, someone using a cash-balance plan could 'save larger sums in a relatively short period of time,' . . . ." (The Wall Street Journal)


[Opinion]
How to Restart the Pension System By Giving Executives a Stake In It
Excerpt: "In 1973, just before ERISA, we worried about individual workers losing their defined benefits because of insufficient funding, no plan termination guarantees, and little or no vesting. Most of us did not worry about the whole system falling apart. There were just too many disappointed expectations under the previous system. Once we found a way to stabilize the security of the defined benefit (DB) system, however, we set about shredding a central feature of the DB system's growth. How? We just about wiped out the senior executive's primary stake in the qualified plan system. We severely limited creditable 'compensation' (IRC 401(a)(17)), while also setting a low maximum level of defined benefits under qualified plans (415), and then we piled on limit after limit ('QSLOB's, 'top heavy' rules, etc. etc. etc.)." (Pension & Benefits Blog)


[Opinion]
American Academy of Actuaries Comments on IRS 2009-2010 Guidance Priority List and Provides List of Key Issues Awaiting Guidance (PDF)
3 pages. Excerpt: "The following attachment contains a list of items the committee would like to see addressed by the IRS, categorized by preference/priority. It is important that the IRS provide proposed guidance early, so comments can be made and final guidance issued on a timely basis. The attached list is what we consider key issues awaiting guidance. This is not a comprehensive list of all the guidance needed but rather the most important needs for 2009-2010. We list the issues in order of urgency within broad topic areas such as funding, hybrid plan, and benefit restriction rules." (American Academy of Actuaries)

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Links to Items on Executive Comp, Benefits in General

[Guidance Overview]
California's Proposition 8: Defines 'Marriage' As a Union Between a Man and a Woman (PDF)
2 pages. Excerpt: "Despite the significant loss of the right to marry, same-s.ex couples in California can still obtain the same legal rights and protections as spouses by entering into domestic partnerships. California enacted a domestic partnership law in 1999; this law remained in effect throughout the short-lived legalization of same-s.ex marriage. Domestic partners are defined under state law as 'two adults who have chosen to share one another's lives in an intimate and committed relationship of caring.'" (Thompson Publishing Group via McDermott Will & Emery)


[Guidance Overview]
IRS's Multi-Year Random Audit Program on Employer Tax Returns
Excerpt: "The IRS announcement noted that although these random audits may target any reporting aspect of the tax return, the primary focus will be to verify whether the taxpayer has complied with the relevant employment tax law concerning: Worker classification (employee vs. independent contractor); Executive compensation; Fringe benefits; and Reimbursed expenses." (Haynes & Boone)


[Guidance Overview]
Government Reverses Position on ERISA Theft Indictments
Excerpt: "The issue presented in U.S. v. Jackson is of critical importance in the enforcement of ERISA criminal provisions. . . . At issue - are unpaid ERISA plan contributions plan assets? The District court had held that the defendants were properly convicted under 18 U.S.C. § 664 and § 669 because the funds withheld from employee wages were plan assets. The Fourth Circuit agreed. The defendants sought Supreme Court review. In an interesting turn of events, the Solicitor General reversed the government's position on the theft indictments. The Supreme Court vacated the decision of the Fourth Circuit and remanded for further consideration in light of the Solicitor General's new position." (Roy Harmon III via Health Plan Law)


Federal Employee Pay and Benefits Legislation Awaits Lawmakers
Excerpt: "Congress has several bills under consideration, including legislation that would affect federal employees. Here is a recap of some issues that lawmakers could vote on before they leave for August recess." (GovernmentExecutive.com)


Companies Are Targeting 'Feel-Good' Benefits to Cut Costs
Excerpt: "[A]s employers clamp down on even the smallest costs, [adoption assistance] and other high-profile offerings -- including child- and elder-care referral services, matching of charitable contributions and scholarships for employees' kids -- are being cut back, according to a new national survey. The trend suggests any benefit perceived as a frill can be in jeopardy, no matter how low its cost or how wholesome its image." (The Wall Street Journal)


Philadelphia Confronts the Cost of Employee Benefits (PDF)
18 pages. Excerpt: "Against [the recession] backdrop, one of Philadelphia's biggest expense items -- its employee benefits -- has emerged front and center. The amount Philadelphia spent on health care benefits and pension costs alone stood at $830 million, or 21 percent of its general fund budget in fiscal 2009. This is up from $590 million, or 17 percent in 2005 and $403 million, or 16 percent, in 1998. Under a city plan that needs approval from the state legislature, pension costs are projected to decline over the next two years -- before rising dramatically. By 2013, the bill for pensions and health care combined is projected to approach $1.1 billion, or 26 percent of general fund spending. And that estimate is based on the assumption that the city's total health care expenses will stay about where they are now." (The Pew Charitable Trusts)

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Press Releases

PSCA Releases 403(b) Target-Date Fund Survey
Profit Sharing/401(k) Council of America (PSCA)

John Marshall's Kozak Named to CBA, ABA Positions
John Marshall Law School, The

Segal Advisors, Inc. Announces New Officer
Segal Advisors

HighRoads Debuts Health and Welfare Consulting
HighRoads, Inc.

Goldleaf Partners Names Sales Director for Leading Independent Provider of Employee Benefit Administration and Consulting Services
Goldleaf Partners

P&A Group Launches Marketing Campaign Focusing on the Fee Based Advisor Retirement Channel
P&A Group

Sibson Consulting Expands Sales Force Effectiveness and Performance and Rewards Practices
Sibson Consulting

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