Legislative Issues

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Legislative information relevant to retirement plan professionals can be found below, including House and Senate bills, bill summaries, conference reports, legislative technical explanations, House or Senate committee position papers, and bill side-by-side comparisons.

On April 16, 2008, the House Education and Labor Committee passed the amended version of the 401(k) Fair Disclosure for Retirement Security Act (H.R. 3185). [HR 3185] [Andrews’ Amendment]

On December 13, 2007, Senators Herb Kohl (D-WI) and Tom Harkin (D-IA) introduced the “Defined Contribution Fee Disclosure Act of 2007. [Senate Fee Disclosure Bill]

On November 1, 2007, ASPPA, along with several other organizations, expressed support for legislation extending the effective date of the PPA funding rules. [Pomeroy Letter ] [Cantor Letter]

On Oct. 17, Rep. Earl Pomeroy (D-ND) introduced legislation to delay the effective date of the PPA funding, minimum lump sum, and benefit restriction rules. [Bill]

On October 4, 2007, House Ways and Means Committee Member Richie Neal (D-MA) introduced the “Defined Contribution Fee Transparency Act of 2007. [H.R. 3765]

On August 2, 2007, the Senate introduced the “Pension Protection Technical Corrections Act” (S 1974); On August 3, the House of Representatives introduced identical legislation (HR 3361). [S 1974] [HR 3361] [Joint Tax Description]

On July 27, 2007, House Education and Labor Committee Chairman George Miller (D-CA) introduced the “401(k) Fair Disclosure for Retirement Security Act of 2007” (H.R. 3185). [HR 3185] [HR 3185 Summary]

On May 3, 2007, Senator Gordon Smith (R-OR), Kent Conrad (D-ND), Jeff Bingaman (D-NM), John Kerry (D-MA) and Olympia Snowe (R-ME) introduced the Women’s Retirement Security Act (S. 1288). [Bill] [Summary]

On December 20, 2006, the President signed the Tax Relief and Health Care Act of 2006 (HR 6111), which includes extensions of expiring tax provisions and provisions on health savings accounts (HSAs). [Bill]

Late on July 28, 2006, HR 4 was passed and has benefit provisions that largely mirror those in a long-stalled House-Senate conference report. Among other things, HR 4 would overhaul pension funding rules, enacts EGTRRA pension permanence and includes reforms affecting hybrid plans, defined contribution plans, nonqualified deferred compensation, and health plans.. [HR 4]

On May 17, 2006, HR 4297, Tax Increase Prevention & Reconciliation Act of 2005, was signed into law. It extends the 15% rate on capital gains and dividends through 2010, provides one year of individual AMT relief, and eliminates the income cap on eligibility for rolling over traditional IRAs to Roth IRAs. [HR 4297 info]

On March 16, 2006, Senate Finance Committee Ranking Member Max Baucus (D-Mont.) introduced the Savings Competitiveness Act, which would expand the availability of payroll deduction retirement plans and encourage automatic enrollment. [Press Release]

On February 8, 2006, President Bush signed Feb. 8 the Deficit Reduction Act of 2005 (S. 1932; PL 109-171), a broad-based budget reconciliation bill that among other things increases the premiums that DB plans pay to the PBGC. [PL 109-171]

On December 15, 2005, the House passed comprehensive pension reform legislation (294-132), HR 2830, “The Pension Protection Act of 2005,” dealing with funding, PBGC premium, hybrid plan, defined contribution plan, health plan and nonqualified deferred compensation matters. [HR 2830]

On November 16, 2005, the Senate passed comprehensive pension reform (97-2), S 1783, “The Pension Security and Transparency Act of 2005” (S 1783). It incorporates provisions of S 219, “The National Employee Savings and Trust Equity Guarantee Act,” and “The Defined Benefit Security Act.” The bill covers provisions of funding, multiemployer plans, hybrid plans, DB(k), investment advice, automatic enrollment, among others. [S 1783]

On September 27, 2005, Reps. Andrews (D-NJ) and Nussle (R-IA) introduced HR 3899, the Small Employer Defined Benefit Expansion Act to provide for the creation of the DB(k)a hybrid combination of a traditional DB plan and 401(k) DC plan. [HR 3899]

On September 23, 2005, President Bush signed the legislation providing short-term tax incentives to help those directly affected by Hurricane Katrina [PL 109-73]

On September 15, 2005 the House (HR 3768) and Senate (S 1696) approved legislation providing short-term tax incentives to help those directly affected by Hurricane Katrina. [HR 3768] [S 1696]

On June 30, 2005, the Retirement Savings and Security Act of 2005, was introduced, by Senators Smith (R-OR) and Conrad (D-ND) to increase retirement savings and security, to facilitate the provision of guaranteed retirement income for life, and to make the retirement plan rules simpler and more equitable. [S. 1359]

On June 23, 2005, the Pension Benefits Protection Act of 2005 was introduced, by Senators Harkin (D-IA), Kennedy (D-MA), Durbin (D-IL), Feingold (D-WI), Boxer (D-CA), and Dayton (D-MN) to protect pension benefits of employees in defined benefit plans and to direct the Secretary of the Treasury to enforce the age discrimination requirements. [S. 1304]

On June 9, 2005, Rep. Boehner (R-OH) introduced HR 2830, the Pension Protection Act, a bill which provides comprehensive pension reform for single employer and multiemployer defined benefits plans, along with a professional investment advice provision. [HR 2830]

On June 16, 2005, the Lifetime Pension Annuity for You Act of 2005 was introduced, by Congressman Pomeroy (D-ND), to encourage guaranteed lifetime income payments by excluding from income a portion of such payments. [H. R. 2951]

On June 9, 2005, Rep. Boehner (R-OH) introduced HR 2831, the Pension Preservation and Portability Act, which provides an age discrimination standard for cash balance defined benefit pension plans. [HR 2831]

On June 16, 2005, ASPPA submitted a letter of support to the Lifetime Pension Annuity for You Act of 2005. [letter]

On June 15, 2005, ASPPA submitted a statement to the House Committee on Education and the Workforce recommending that only plans with more than 500 participants be required to comply with the proposed new disclosure notice requirements in H.R. 2830. [statment]

On June 8, 2005, ASPPA submitted comments for the record to the Senate Committee on Health, Education, Labor and Pensions, hearing on hybrid and multiemployer pension plans. ASPPA's comment focused on cash balance plans. [comments]

On June 7, 2005, ASPPA submitted comments for the record to the House committee on Ways & Means, Tax Reform hearing, which expressed concerns about the potential detrimental affect certain reform options could have on the employer-sponsored retirement plan system. [comments]

On May 12, 2005, the Pension Security Disclosure Act of 2005 was introduced by Congressman Doggett (D-TX) to improve disclosure of the funding status of pension plans. [H.R. 2321]

On May 10, 2005, the Pension Fairness and Full Disclosure Act of 2005 was introduced by Congressman Miller (D-CA) to limit the availability of benefits under an employer's nonqualified deferred compensation plans in the event that any of the employer's defined pension plans are subjected to a distress or PBGC termination. [H.R. 2233]

On May 10, 2005, the Pension Fairness and Full Disclosure Act of 2005 was introduced by Senator Kennedy (D-MA) to limit the availability of benefits under an employer's nonqualified deferred compensation plans in the event that any of the employer's defined pension plans are subjected to a distress or PBGC termination. [S. 991]

On April 28, 2005, Rep. Cardin (D-MD) and Rep. Portman (R-OH) each separately introduced the “Pension Preservation and Savings Expansion Act.” The bills include a refundable SAVER’s credit, employer incentives to provide automatic enrollment, incentives for choosing a retirement annuity, and make certain EGTRRA pension provisions permanent, among other provisions. One of the major differences between the two bills is that the Cardin pension bill would repeal the Roth 401(k). [Rep. Cardin's bill] [Rep. Portman's bill]

On April 21, 2005, Senator Bingaman (D-NM) introduced S. 875, the “Save More for Retirement Act of 2005.” A bill that aims to increase participation in 401(k) plans through automatic enrollment. [more information]

On April 20, 2005, President Bush signed into law S. 256 (Public Law No: 109-8), the bankruptcy reform legislation that provides broad protections for benefits under tax-exempt retirement funds. [more information]

On March 8, 2005, Sen. Craig Thomas (R-WY) announced three new kinds of savings accounts focused on private savings as a means to retirement security. Thomas and cosponsor Sen. Jon Kyl (R-AZ) introduced three separate bills to create lifetime savings accounts (S. 545), retirement savings accounts (S. 546), and employer retirement savings accounts (S. 547). The three bills together comprise what Thomas called the Savings Account Vehicle Enhancement (SAVE) initiative. And on the House side, Rep. Johnson (R-TX) introduced HR 1161, provide for employer retirement savings accounts; HR 1162, the Retirement Savings Account Act; and HR 1163, the Lifetime Savings Account Act of 2005.

• S 545 S 546 S 547

  HR 1161 HR 1162 HR 1163

On January 31, 2005, Senators Grassley and Baucus re-introduced the NESTEG Pension Bill and announced plans to look at more reforms. [more information]

On December 19, 2004, Rep. Rob Andrews (D-NJ) introduced pension reform legislation (H.R. 5398 PDF: 248K) containing a provision which would create a hybrid retirement plan consisting of both a traditional defined benefit plan and a 401(k) defined contribution plan, called the DB(k). The DB(k) concept, found in Title V of the legislation, was developed by ASPPA and The Principal Group to encourage the adoption of defined benefit plans by small and mid-sized businesses by removing unnecessary administrative and regulatory impediments. Andrews also introduced a companion pension reform bill amending ERISA provisions. (H.R. 5397 PDF: 248K)

On April 8, 2004, the Senate voted to support HR 3108, the bill to temporarily replace the 30-year Treasury bond rate with a corporate bond rate for purposes of calculating the deficit reduction contribution (and for PBGC purposes), 78-19. The House supported the bill, 336-69, on April 2. Thank you to those who contacted senators to support the bill. The President signed it on April 10. [Pension Funding Equity Act of 2004]

On February 2, 2004, the Secretary of Treasury unveiled a new version of the LSA/RSA/ERSA proposals. ASPPA’s Government Affairs Committee has met with senior Administration officials on numerous occasions to express serious concerns about the possible impact of last year’s savings proposals on small business retirement plan coverage. Significantly, many of the revisions to the proposals were made in response to the concerns raised by ASPPA. In response to the changes made by Treasury, ASPPA no longer opposes the proposals as outlined in Treasury’s budget proposal. [summary of the proposed changes and analysis]

Questions have been raised about the potential impact of the Administration's proposal on retirement savings, particularly savings by workers of our nations' small businesses. While the Administration's proposal may arguably address reasonably sound tax policy concerns about making sure that corporate income is taxed only once, it potentially could have an unintended, adverse impact on small business retirement plan coverage. [more]

On May 14, 2003, the House of Representatives passed an Enron-inspired pension reform bill, including provisions to permit diversification of employer stock, requiring quarterly benefit statements, changes to ERISA section 404(c), and other significant proposals. [detailed summary]

On October 8, 2003, the House overwhelming passed (372 to 2) the Pension Funding Equity Act (HR 3108). The bill provides for the replacement of the 30-year Treasury bond rate with a blend of corporate bond index rates through 2005. The Joint Committee on Taxation provided a technical explanation of HR 3108.

ASPPA and Small Business Council of America sent a joint letter to Chairman Thomas (R-22nd Calif.), chair of the House Committee on Ways & Means; and Chairman Grassley (R-Iowa), chair of the Senate Finance Committee; impressing upon them the importance of addressing small business retirement plans if annuities are added to the dividend exclusion proposal. [Letter]

There has been an effort by various members of Congress over the past few weeks to attach parts of the Enron-inspired pension legislation to the accounting reform bill which moved swiftly through Congress. Although most of the proposed pension legislation was not included, the accounting reform bill signed into law by the President on Tuesday, July 30, 2002, included three provisions affecting pensions. Specifically, the provisions are a new blackout notice requirement, a restriction on insider trading during a blackout, and increased ERISA penalties. Detailed summary of provisions

ASPPA's Government Affairs Committee has worked closely with congressional staff in order to perfect the legislative language as much as possible.

On July 11, 2002, the Senate Finance Committee reported out pension legislation in repsonse to Enron by voice vote (without dissent). In March, the Senate Health, Education, Labor, and Pension (HELP) Committee reported out its pension bill by a vote of 11-10, along party lines. The differences between these bills will have to be resolved before full Senate consideration. The full Senate is currently scheduled to take up this legislation in September. Review a detailed side-by-side comparison of the Senate Finance and HELP committee bills, as well as the House bill passed in April.

On Friday, June 21, 2002, the House of Representatives voted to permanently extend pension reform provisions. Thank you to the over 1,350 members who contacted their representative and asked for their support of H.R. 4931, the bill to permanently extend the pension reform provisons of EGTRRA. The bill passed the House by a vote of 308 to 70.

On November 13, 2001, ASPPA provided letters of support to Senator Bingaman (D-NM) and Senator Collins (R-Maine) for the "Independent Investment Advice Act of 2001." The bill will provide retirement plan sponsors with a safe harbor with respect to the designation and monitoring of independent investment advisers for workers managing their retirement plan assets and make independent investment advice more accessible to the American workforce. Letters to Senator Bingaman and Senator Collins

On September 24, 2001, ASPPA sent letters of support to Senator Grassley, Senator Bob Graham, Representative Cardin, and Representative Portman for their sponsorship of S 1305 and HR 2807 (Professional Employer Organization Workers Benefits Act of 2001) respectively. ASPPA stated that the bills will provide another important tool to help small businesses provide retirement coverage to rank-and-file workers. Letters to Senators

On June 29, 2001, ASPPA released an ASPPA ASAP (01-13) discussing the potential application of new privacy laws to retirement plan service providers. Sample privacy notice

After almost five years of work, ASPPA is pleased to announce that Congress has finally passed pension reform. Thanks to all of you who made calls, wrote letters, and used the web site. Your efforts really made a difference. Most of all thanks for your support of ASPPA and its Government Affairs Committee. Without your support, we would have never achieved this victory.

Text of H.R. 1836 (the entire tax legislation, including pension reform) (Note: this file is in pdf format, and requires Acrobat Reader® to open. Don't have it? Get the free plugin here!) Summary of the pension reform changes

You can order the conference report from GPO's bookstore (http://bookstore.gpo.gov/). You want item #107-84, Economic Growth and Tax Relief Reconciliation Act of 2001 (Conference Report to accompany HR 1836). It costs $25. You can order it online or through their actual bookstore. There are bookstores throughout the US (they are listed on GPO's bookstore webpage).

Pension reform passes in the 107th Congress. Access the current version of the comparison of the current pension law and the pension provisions of the Economic Growth & Tax Reconciliation Act of 2001.

Text of H.R. 1836 (the entire tax legislation, including pension reform) (Note: this file is in pdf format, and requires Acrobat Reader® to open. Don't have it? Get the free plugin here!) New law summary

In the 106th Congress, ASPPA actively encouraged comprehensive pension reform legislation in Congress. In the House, the Comprehensive Retirement Security and Pension Reform Act, H.R. 1102, was introduced by Representatives Portman (R-OH) and Cardin (D-MD). Comparable legislation in the Senate, the Pension Coverage and Portability Act, S. 741, was introduced by Senators Graham (D-FL) and Grassley (R-IA). Among other things, this legislation relaxes the Top Heavy rules, repeals the full funding limit, and repeals the 25% of compensation limitation under 415 (c).

ASPPA strongly supports legislation, H.R. 2190, introduced by Representative Johnson (R-CT) and Pomeroy (D-ND), which creates a simplified, portable defined benefit plan called the "SAFE" plan funded through either an annuity or a trust. This will provide all small business employees with a secure, fully portable, defined retirement benefit they can count on without choking small business with complex rules and regulations small business cannot afford. Check out the full text of the legislation at thomas.loc.gov.

ASPPA supports several provisions in the Retirement Savings Opportunity Act, S.649, introduced by Senators Roth (R-DE) and Baucus (D-MT). Among the beneficial provisions is an innovative provision which allows 401(k) and 403(b) plan participants to choose their tax treatment. Under the proposal, participants could choose to treat their contributions like contributions to a Roth IRA (i.e., as after-tax contributions not included in income when distributed if held for five years). The Act also includes the "SAFE" proposal and tax credits for start-up costs of small employer plans. Check out the full text of the legislation at thomas.loc.gov.