Pension Security Depends On Your Communicating With Members Of Congress 3/19/06
Capwiz Action Alert to All NRLN Members
From: Bill Kadereit, NRLN Vice President, Legislative Affairs
This is a follow-up to the Action Alert sent to you by NRLN President Jim Norby on March 11, 2006. I want to say thank you to those who have sent some 6,000 letters to your U.S. Senators and Representatives. At the same time, I want to urge those of you who have not sent your letters to do so immediately by going to the Action Alert at http://capwiz.com/abtr/home. Look for the headline: MAKE IMPROVEMENTS TO PENSION REFORM LEGISLATION.
It is the security of your pension that these conferees are dealing with in the days and weeks ahead. And if some improvements are not made to the House and Senate bills in the conference committee the security of your pension will be worse rather than better.
Your letters have made an impact on the issues of Transparency and Disclosure and Investment Advice. In the remaining days of our grassroots and lobby efforts we will be focusing on the Cash Balance and Section 420 Transfers issues as explained below in the “Talking Points”
I urge you to immediately send the sample letters that are available to you in the Capwiz section of the NRLN website. In addition, I encourage you to contact your Senators and Representative while Congress is on Spring Break (March 17 – 24) and they are likely to be in their home states and districts. Call for an appointment to meet with them, go to a town hall meeting or talk with them on the phone. You can obtain the phone number of in-state offices by going to the NRLN Website at http://www.nrln.org and type your zip code in the “Write To Congress” box near the top of the page on the right. After you click “GO” the names and photos of your Senators and Representative will appear. Click on the “info” link under each photo to obtain office contact information.
So that you will know whether your Senators or Representative are members of the pension reform conference committee, here is a list of the conferees:
Johnny Isakson (R-GA), Charles Grassley (R-IA), Tom Harkin (D-IA), Edward Kennedy (D- MA), Olympia Snowe (R-ME), Barbara Mikulski (D-MD), Trent Lott (R-MS), Max Baucus (D-MT), Kent Conrad (D-ND), Judd Gregg (R-NH), Jeff Bingaman (D-NM), Mike DeWine (R-OH), Rick Santorum (R-PA), Orrin Hatch (R-UT), John Rockefeller (D-WV) and Michael Enzi (R-WY).
House Majority Leader John A. Boehner (R OH-8), Howard P. (Buck) McKeon (R CA-25), George Miller (D CA-7), William M. Thomas (R CA-22), Dave Camp (R MI-4), John Kline (R MN-2), Robert E. Andrews (D NJ-1), Donald M. Payne (D NJ-10), Charles B. Rangel (D NY-15), Patrick J. Tiberi (R OH-12) and Sam Johnson (R TX-3).
NRLN Vice President, Legislative Affairs
Pension Reform Legislation Improvement Issues:
(Please print a copy to use in discussions with members of Congress)
I am a retiree from __________________ and live in ________________. I’m one of the more than 2 million retirees affiliated with the National Retiree Legislative Network.
I want to thank you for supporting more open disclosures on pension plans and ensuring independent investment advice for 401(k) plans.
I support the NRLN’s position on improvements that are essential to the pension reform legislation under consideration. I urge you to work on making the following improvements during the conference committee process:
CASH BALANCE CONVERSIONS
I strongly support the prospective provision in the Senate bill eliminating “wearaway” for normal and early retirement. It is extremely important that this provision be included in the final bill. I oppose any provision that would weaken these protections for retirees.
I also strongly oppose any and all efforts to retroactively legalize cash balance conversions. The legal risks associated with the conversion of defined benefit plans to cash balance plans were well-known to employers when they undertook these conversions and yet they were still willing to move forward. As a result, thousands of older worker have suffered the “wearaway” of earned benefits as well as the loss of early retirement benefits. Congress should not change the law retroactively to protect those companies that acted unfairly and unlawfully.
SECTION 420 TRANSFERS
I strongly endorse the principle of a 100% funding target. However, since markets are inherently volatile, I believe that an existing surplus should not be drained. I am adamantly opposed to the Senate provision (Sec. 1331 of the Senate bill) which modifies Section 420 of the Internal Revenue Code to lower the transfer threshold of the plan surplus from 125% to 115%. The 125% rule created a cushion of protection of 35% that should not be changed.
A longer maintenance of cost period, as proposed, and promises to restore funding levels to 115% will do little good if the employer’s deteriorating financial situation impairs its ability to fully fund the plan. This inability to fund (top off)could result in more plan terminations or freezes.
Close your conversation by thanking the Senator
or Representative for his/her time. Express your hope that he/she
will see the wisdom of including in the pension reform legislation
the areas for improvements that you have described.