Archive for the ‘Uncategorized’ Category

Pension Provisions of New Republican Tax Plan

Bob Woodward’s Fear is now available with its narrative of a dysfunctional executive surrounded by a combination of traitors and dedicated public servants looking to keep the country on the right path notwithstanding the distractions. Among the latter group are Republicans on the tax-writing House Ways and Means Committee which just released a tax plan that would:

I work with retirement plans so I can speak to some of the proposals in the second bullet point which, for the most part, make sense:

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Politicians Cashing In – Still

Politico.com had an interesting article on how New Jersey Senate President Stephen Sweeney killed a pension-padding bill for politicians:

Last week, Matt [Friedman] you all about the 11 elected officials who applied to take advantage of the new law that lets some politicians buy back time they spent out of the pension system, allowing them to further pad their retirement income and do so at the same tier they were at previously. The bill was designed to benefit former Camden Mayor Dana Redd, and it was signed by Gov. Chris Christie just days after Redd was hired as the CEO of an obscure university governing board at a salary of $275,000.

One of the more interesting things Matt found in the documents he obtained through a public record request involve the application of Sen. James Beach (D-Camden). It appeared not to make financial sense for Beach to re-enroll under the law: he would need to pay the pension system $150,000 to qualify. That’s what the state told him in a letter sent on April 16. Two months later, in the midst of budget negotiations in June, Assemblyman John McKeon (D-Essex) introduced a bill that would allow elected officials who are already receiving pensions to continue receiving the benefits while re-enrolling in the system and building more credits. They wouldn’t have to pay back any money. Voila! Beach could get back in and without giving away the farm.

But that bill, which McKeon said he introduced at the request of “leadership,” didn’t make it to the floor of either house after Matt revealed its existence and other reporters followed up. What happened to it? According to Senate President Steve Sweeney, it died at his hands. “I was never going to do it,” Sweeney said during a two-hour interview with the POLITICO staff on Friday. Where did it come from? “The Assembly. It wasn’t my bill,” Sweeney said.

The Senate president made the remarks as he pushes Gov. Phil Murphy and fellow lawmakers to consider further cuts to public employee pensions and health benefits that are outlined in a new report from his fiscal policy working group. When Matt suggested he wasn’t leading by example, given the brazen efforts to pad the pensions of elected officials, Sweeney swung back hard. “Not true. You’re wrong,” he snapped, cutting Matt off. Why, pray tell? Because of the 2007 law that cut future elected officials out of the pension system. “There are thousands of people that are not in the pension system today that would have been in the pension system if we didn’t make the change.” He added: “You can’t make 11 the example when there’s thousands that are out.”

Not quite all out according to a review of current retirees.

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Jeremy Gold

On Friday someone sent me a link to a Wall Street Journal article titled “Jeremy Gold Shook Up Pension World With Warnings About Risks” and I assumed that Mr. Gold was making news again and I wanted to see what he was up to. Not being a WSJ subscriber, I could not get the full article online. I had heard that you can put the article title into google and sometimes it comes up with the full story but that did not work this time. So I went to the library yesterday to scour past papers. I looked through the headline and finance news and found nothing going back to Wednesday’s edition. Today I tried again online and the full article came up. I had been looking in the wrong places. In the obituaries….

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Bailout Committee To Hear Employers

The Joint Select Committee on the Solvency of Multiemployer Pension Plans (Bailout Committee) today announced they will convene a hearing next Wednesday (June 13) “to hear firsthand from several employers about the challenges they face, as well as insight into how the multiemployer pension system can be improved.”

The witnesses:

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Pension-Financing the Deficit

Good evening gentle reader.

Apologies for my being MIA for so long.

Mr. Bury and his site are an excellent source of information on the pension status for NJ and also for the nation.

My practice is taking me a different direction and I would like Americans concerned about their future financial security to be aware.  Just this week, I have spoken with retirement academics, unions, The US Chamber of Commerce, and National Coordinating Committee for Multiemployer Plans, among others.   By now you know I support a combination of recapitalization and reforms for the pension industry.  I support the concept of the Butch Lewis Act.  But I propose financing with the Federal Reserve rather than Treasury.

I have a goal and a calendar. I want to go to test funding by the end of June. Another difference I am proposing with Butch Lewis is, while the act targets Multiemployer pensions, I want to include state pension plans.  I have so far spoken with two states on this subject.

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EA18 (4) Risk in NYC

This year’s Enrolled Actuaries meeting is a bit faster paced as breakout sessions have gone from 90 minutes to a bite-sized 75 minutes and there are now 10 of them instead of 8. In that spirit these blogs will be shorter and more frequent.

We kick with my notes (my comments in brackets) on what Sherry S. Chan, New York City Chief Actuary, said at the first general session ‘Talking Risk’.

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PBGC Primer

In FY2017, the Pension Benefit Guaranty Corporation (PBGC) insured about 24,000 DB pension plans covering approximately 40 million people. PBGC became the trustee of 82 newly terminated single-employer pension plans and began providing financial assistance to an additional 7 multiemployer pension plans. PBGC paid benefits to nearly 840,000 participants in 4,845 single-employer pension plans and more than 63,000 participants in 72 multiemployer plans.

All this according to PBGC: A Primer. More excerpts:

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