This has been an extremely busy season for the NAGDCA Executive Board, as well as the organization as whole. Due to all the action going on within the retirement arena, we have been working to communicate NAGDCA's positions on legislative issues with officials in Washington, while keeping members abreast of the latest news from Capitol Hill. The NAGDCA Board traveled to Washington DC for the annual Hill visits at the end of February, where we met with several congressional staff members and representatives of the Department of Treasury. During our time in Washington, we developed the following list of legislative priorities for the organization (to view the full letter of legislative priorities, click here.

• Maintain Important Distinctions Between Governmental Defined Contribution Plans: The continued growth in assets in governmental defined contribution plans is evidence of the value of these supplemental retirement vehicles. Therefore, NAGDCA supports the continued existence of substantive distinctions of §457(b) plans. NAGDCA is concerned that efforts to further simplify or consolidate defined contributions may result in the loss of benefits to public employees. NAGDCA has identified a number of practical concerns related to efforts to consolidate defined contribution plans.
• Ensure Parity: Enhancing retirement benefits and incentives for savings to all governmental and private sector workers.
• Maintain Exemption from Early withdrawal penalty: Under current law, government §457(b) plan employees are not subject to the 10 percent early withdrawal penalty. This recognizes the fact that many public employees, particularly police officers, firefighters, correction officers and other public safety officers, have access to early retirement options. In addition, many employees currently rely upon these early withdrawals to pursue retirement or phased-retirement options, including using these dollars to supplement health care costs during early retirement. Under consolidation proposals, as continued in the President's Federal Fiscal Year 2008 Budget proposal it is not clear that this current benefit would remain intact
• Maximize Unused Flexible Account Dollars: NAGDCA supports allowing state and local government employees to roll up to $500 dollars in unused flexible spending account dollars into their defined contribution plans. (457, 401(k) or 403(b) plans)
• Enactment of a Roth 457 Option: 401(k) and 403(b) plans are permitted to offer a Roth 401(k) or a Roth 403(b) to allow participants to save for retirement with both pre- and post-tax contributions. It is important that public-employer sponsored 457 plans be permitted to provide this same range of retirement savings options to is participants.
• Permit Non-Spousal Beneficiaries to Roll Assets to 457 and 403(b) Plans: The PPA permitted non-spousal beneficiaries to roll assets they obtain as a beneficiary to an IRA. EGTRRA acknowledged that the consolidation of retirement assets is valuable to those with multiple retirement savings accounts. It would be similarly valuable to non-spousal beneficiaries to consolidate their beneficiary assets to their 457(b) or 403(b) accounts.
• Extend the "National Save for Retirement Week" Resolution: We appreciate the support of the Senate in establishing the first National Save for Retirement Week in 2006 and urge the Senate and House of Representatives to pass an extension of this Resolution during the 110th Congress. This Resolution was a solid example of the partnership we have developed over the years and by giving national attention to this issue, this assisted state and local government employers across the country in creating a heightened level of awareness towards the importance of taking personal responsibility for saving for retirement.
• Increase population cap for Low Income Savers Tax Credit: The addition of a provision for indexing of the income limits on the Savers Tax Credit is valuable and would and allow more low-income individuals to take opportunity to save.

Also, NAGDCA has several activities on the horizon:

• The 2007 Industry Roundtable (April 18-19, Washington, DC)
• Speakers will be chosen for the 2007 Annual Conference (Deadline April 30)
• Working with Senators Smith and Conrad to introduce the Resolution for NS4RW in 2007
• NAGDCAST #2: Target Date Funds (Summer, TBD)