Compliance June 22, 2018

PBGC Wants to Obtain Multiemployer Plan Withdrawal Liability Information

In its notice of intent to request OMB approval, the agency is asking for stakeholder comments,

Reported by

The Pension Benefit Guaranty Corporation (PBGC) plans to request that the Office of Management and Budget (OMB) approve a survey of terminated and insolvent multiemployer pension plans to obtain withdrawal liability information.

The agency says it needs the information to estimate its multiemployer program liabilities for purposes of its financial statements.

The PBGC recently issued a report that says the likelihood the multiemployer program will remain solvent after FY 2026 is now less than 1%.

In its notice of intent to request OMB approval, the agency is asking for stakeholder comments about the survey.

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Compliance June 22, 2018

CT Passes Law to Apply Fiduciary Standards to non-ERISA 403(b)s

The law applies to Connecticut K-12 school districts.

Reported by

Connecticut has passed a law that will bring non-Employee Retirement Income Security Act (ERISA) 403(b) plans closer to ERISA 403(b) plans. The law applies to Connecticut K-12 school districts.

Connecticut decided to pass the law after Connecticut teachers regretted investing in certain products without being informed of fees and other charges, according to a Hooker & Holcombe client alert. The new law requires the plans to disclose the fee ratio and returns, net of fees, for each investment offered to participants.

The new law went into effect October 1, 2017, but gives plan sponsors until January 1, 2019, to comply.

It also requires the plans to disclose any fees paid to an advisers, and provide applicable disclosures to participants when enrolling and again each year.

Hooker & Holcombe issued a checklist to help 403(b) plans follow ERISA best practices, starting with assigning either the school’s administration or an adviser to ensure vendors comply with the law and asking each vendor how they plan to comply with the law. The law firm says sponsors should also ask vendors for copies of draft disclosures they plan to supply participants upon enrollment and annually, and ensure that the information is in an easy-to-read format.

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