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By: Susan J. White & Jonah Mainzer, Susan J. White & Associates, Inc. Administration Since President Obama was inaugurated in late January, his new Administration has faced a myriad of issues, including the continued downturn in the economy, wars in Iraq and Afghanistan and a stepped up focus on federal health care reform. Even with all of these pressing issues, the Administration did send retirement related proposals to Capitol Hill and the President and some of his senior advisors have talked about “moving beyond the recession and focusing on savings…”. National Save for Retirement Week NAGDCA has once again been working with both the House and Senate to introduce a National Save for Retirement Week resolution and has reviewed a draft of the resolution. NAGDCA has pointed out, in its advocacy efforts on Capitol Hill, that the Resolution this year is more important than ever and, while the economy makes this more difficult, the need to save has not changed. Representative Schwartz (D-PA) has indicated her support for sponsoring a resolution again this year, and the Senate is working on a similar measure. Roth 457 On June 12, the House of Representatives passed a Senate amended version of H.R. 1256 (The Family Smoking Prevention and Tobacco Control Act) which contains Roth provisions for federal employees. The President has indicated that he will sign the bill and is expected to do so shortly. Passage of this bill means that state and local government 457(b) plans are one of the few plans still excluded from taking part in Roth type retirement savings vehicles. Because the Roth 457(b) proposal (first proposed by NAGDCA) has gained attention on Capitol Hill, it is possible that it could be included in a tax bill this fall. Currently, the House Committee on Education & Labor is actively looking at fee disclosure. Chairman Miller (D-CA) has reintroduced H.R. 1984 (The 401(k) Fair Disclosure for Retirement Security Act of 2009) after it failed to move during the last Congress. This bill is directed at 401(k) and other ERISA plans and would not directly affect state and local government plans—given their exemption from ERISA. H.R. 1984 addressed issues of information provided to participants to make choices, to employers and employees, and address conflicts of interest. Additionally, the measure provides a low cost index fund option for all defined contribution plans. Because the House Committee on Ways and Means and the Committee on Education and Labor share jurisdiction on this issue, unresolved matters remain that must be worked out by both panels before a bill is brought to the House floor. Representative Neal (D-MA) recently introduced H.R. 2779 (The Defined Contribution Plan Fee Transparency Act of 2009). This bill addresses transparency with respect to fees and expenses charged to participant-directed defined contribution plans and to improve participant communication, but is different from the Education and Labor Committee in several respects. Until the differences are worked out, it is likely a measure will not reach the House floor. The Committee on Education and Labor Subcommittee on Health, Employment, Labor and Pensions recently held a mark up and reported the bill to the full committee on a party line vote. Full committee action has not yet been scheduled but this bill is expected to pass the full committee when it is brought up. Again, given the complexities of the two committees working out a final measure to be brought to the floor, both chambers’ distraction with health care reform and the fact that there is no similar bill in the Senate, it is unlikely that fee disclosure legislation is expected to pass this year. Legislative Webcast On April 28, NAGDCA held its annual Legislative Webcast. Listeners were able to hear presentations from our offices, the Majority Tax Counsel to the House Committee on Ways & Means and the American Benefits Council. The discussion was focused on NAGDCA’s legislative priorities as well as where Congress was headed with legislation this year and National Save for Retirement Week. Industry Roundtable On May 15, NAGDCA held its fifth Industry Roundtable. Speakers on the Legislative Panel included the outgoing Benefits Tax Counsel at the Department of the Treasury and the Majority and Minority Tax Counsels to the House Committee on Ways & Means. Issues that that were covered included the Saver’s Credit, Roth 457s and fee disclosure. Following the Roundtable, NAGDCA board members met with the new Department of the Treasury, Assistant Secretary for Tax Policy, Mark Iwry. NAGDCA’s President, Legislative Chair and Industry Committee Chair had an opportunity to discuss the Association’s legislative priorities, including the Administration’s pending retirement related proposals.
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