June 16, 2004
In this issue:
- House Committee Approves Stock Option Bill
- American Benefits Council IN THE NEWS
- NOTE: IRS Releases Final Minimum Distribution Regulations
House Committee Approves Stock Option Bill
On June 15, the House of Representatives Financial Services Committee approved the Stock Option Accounting Reform Act (H.R. 3574) by a bipartisan vote of 45-13. The bill, sponsored by Capital Markets, Insurance and Government Sponsored Enterprises Subcommittee Chairman Richard Baker (R-LA), requires expensing for stock options provided to the top five executives (the chief executive officer and next four most highly compensated employees) but not for stock options provided to rank-and-file employees. The bill would override the Financial Accounting Standards Board's (FASB) proposal to mandate expensing of all stock options.
Prior to approval, the committee made a number of changes to the legislation as part of a substitute offered by Committee Chairman Michael Oxley (R-OH). The substitute adds private companies to the list of entities which are exempt from expensing stock options and requires increased transparency and disclosure regarding stock option plans, stock purchase plans, and other equity purchase plans.
The committee also adopted an amendment offered by Representative Brad Sherman (D-CA) that establishes a one-year deadline for completion of an economic impact study required in H. R. 3574.
Chairman Oxley has not yet indicated when the bill would be scheduled for a vote by the full House. For more information, contact Jan Jacobson, Council director, retirement policy, at (202) 289-6700.
American Benefits Council IN THE NEWS:
Long-term strategic plan release, cash balance regulation withdrawal put Council in spotlight
Perspectives of the Council's Board members and staff have appeared in a large number of media stories recently on a number of important topics.
On June 14, the Treasury Department announced it was withdrawing its proposed regulations on cash balance plans and instead urging Congress to address the Administration's cash balance legislative proposals included in its Fiscal Year 2005 budget. Stories quoting Council staff include:
- Treasury: Proposed pension rules changes are withdrawn (Jeff Bliss, Bloomberg News, June 16) also appeared in the Chicago Tribune
- Update: Tsy Drops Cash Balance Pension Regulation Plan (Campion Walsh, Dow Jones Newswires, June 15) (subscription required to view)
- Cash Balance Regulations Off Againâ€¦Again (Eric Hazard, Plansponsor.com, June 15)
- Bush administration kills cash-balance plan (Mary Deibel, Scripps Howard News Service, June 15)
On June 9, the Council released its long-term strategic plan entitled "Safe and Sound" at a media briefing attended by Representatives John Boehner (R-OH) and Rob Andrews (D-NJ) and the Council's Board of Directors. Stories resulting from that event include:
- Benefits Policy: Rep. Boehner says ABC plan contributes to vision for preserving employee benefits (Mike Wyand, BNA Pension and Benefits Reporter, June 15) subscription required to view
- On the Job: Shrinking Nest Egg (Paul Nyhan, Seattle Post-Intelligencer, June 14)
- U.S. worker benefits likely to shrink over next decade (Jeff Bliss, Bloomberg News, June 14) also appeared in Arizona Republic, Philadelphia Inquirer
- Benefits Group Calling for Prolonged Reform Efforts (Chris Grier, BestWire, June 11) (requires purchase to view)
- Report finds that retirement is in jeopardy (Romina Garber, Miami Herald, June 10)
- Report: Retirees need to be financially savvy (Brian Tumulty, Gannett News Service, June 10) also appeared in the Binghamton (NY) Press & Sun-Bulletin, Cincinnati Enquirer, and Tucson (AZ) Citizen
- American Benefits Council calls for more innovation (Tom Anderson, BenefitNews Connect, June 10)
- Business Briefs: Less Benefits (New York Post, June 10)
- ABC calls on brokers to market more innovative products (Karen Lee, BenefitNews Advisor, June 9)
- Hill Briefs: Employment (Emily Heil, Congress Daily, June 9)
- Benefits likely to shrink for American workers (Douglas McArthur, Toronto Globe and Mail, June 16)
Additional recent stories on a variety of matters that feature quotes by Council staff include:
- ERISA is having growing pains at 30 (Tom Anderson, Employee Benefit News, June 15)
- Age-discrimination hobbles loosened (Leah Carlson, Employee Benefit News, June 15)
- Newscast: Retirement benefits continuing to dwindle (Marty Goldenson, Minnesota Public Radio, Marketplace Morning Report, June 14) (requires RealPlayer to activate audio clip)
- Health insurance companies help block mental health parity (Frederic J. Frommer, Associated Press, June 10) also appeared in Ann Arbor (MI) News and affiliated papers, Biloxi (MS) Sun Herald, Bradenton (FL) Herald, Charlotte (NC) Observer, CNN.com, Columbus (GA) Ledger-Enquirer, Daytona Beach News-Journal, Duluth (MN) News Tribune, Fall River (MA) Herald News, Fargo (ND) Forum, Fort Worth (TX) Star Telegram, Grand Forks (ND) Herald, Houston Chronicle, Kansas City Star, Lexington (KY) Herald-Leader, Los Angeles Times, Macon (GA) Telegraph, Miami Herald, Monterey County (CA) Herald, Myrtle Beach (SC) Sun News, New York Newsday, Philadelphia Inquirer, San Diego Union Tribune, San Francisco Chronicle, San Luis Obispo Tribune, Seattle Post Intelligencer, State College (PA)'s Centre Daily, Tallahassee (FL) Democrat, Twin Cities (MN) Pioneer Press, UK Guardian, Wichita (KS) Eagle, Wilkes Barre (PA) Times-Leader, and Winston-Salem (NC) Journal.
- Retirees sort out alternatives in drug coverage (Mark Sherman, Associated Press, June 6) also appeared in Akron (OH) Beacon Journal, Ann Arbor (MI) News and affiliated papers, Atlanta Journal Constitution, Billings (MT) Gazette, Biloxi (MS) Sun Herald, Bradenton (FL) Herald, Canton (OH) Repository, Chicago Daily Herald, Chicago Sun-Times, Columbia (SC) State, Columbus (GA) Ledger-Enquirer, Corvallis (OR) Gazette Times, Duluth (MN) News Tribune, East Valley (AZ) Tribune, Fort Lauderdale Sun Sentinel, Fort Wayne (IN) Journal Gazette and News Sentinel, Harrisburg (PA) Patriot-News, Houston Chronicle, Grand Fork (ND) Herald, Lakeland (FL) Ledger, Lexington (KY) Herald-Leader, Lorain (OH) Morning Journal, Macon (GA) Telegraph, Miami Herald, Monterey County (CA) Herald, Myrtle Beach (SC) Sun News, New Orleans Times-Picayune, New York Newsday, Ocala (FL) Star-Banner, Philadelphia Inquirer, St. Louis Post-Dispatch, San Jose Mercury News, San Luis Obispo (CA) Tribune, Seattle Post Intelligencer, State College (PA) Centre Daily, Tallahassee (FL) Democrat, Tuscaloosa (AL) News, Twin Cities (MN) Pioneer Press, Wichita (KS) Eagle, Wilkes Barre (PA) Times-Leader, UK Guardian, and Worcester (MA) Telegram
- Many Americans sick about health care (Jonathan Weisman, Washington Post, June 1) also appeared in Akron (OH) Beacon-Journal and Houston Chronicle
- Most Americans Say No to EEOC Benefits Ruling (Trish Nicholson, AARP Bulletin, June 2004)
As other stories of note appear, the Council will keep you informed. For more information about any of these articles, please contact Deanna Johnson Keim, APR, Council director, communications, or Jason Hammersla, Council communications associate at (202) 289-6700.
NOTE: IRS Releases Final Minimum Distribution Regulations
In the June 15 Benefits Byte, we reported on the release of final regulations concerning required minimum distributions under Internal Revenue Code Section 401(a)(9) for defined benefit plans and annuity contracts providing benefits under qualified plans, IRAs and 403(b) plans. The link to the final regulations has expired and has now been replaced. The link above should now be operational. The Council's detailed summary of the final regulations is also available. For more information, contact Jan Jacobson, Council director, retirement policy, at (202) 289-6700.
The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.