Watch Out For What Your Plans Say – Or Don’t Say – About Transfers

Most of the special districts and municipalities we represent have numerous collective bargaining units, and many have multiple service locations and facilities. While advising these entities on their retirement and welfare benefits, we’ve come to realize that their retirement plans often do not address a lot of day-to-day operational issues, including the treatment of intra-agency ‘transfers’. Continue reading

Tagged , , , , , | Comments Off on Watch Out For What Your Plans Say – Or Don’t Say – About Transfers

Retiree Health Reimbursement Arrangements are Receiving More Attention

Previously, we wrote about the uses of health reimbursement arrangements and the IRS rules that apply to them. As we explained, an HRA is basically an employer-funded account that may be used for paying specified medical and health costs (including health insurance premiums). Due to the enactment of the Affordable Care Act and its treatment of HRAs under the group health plan rules, HRAs covering active employees are now much harder to establish and maintain. These ACA rules, however, do not apply to retiree-only HRAs. Retiree-only HRAs can provide significant tax-free health benefits and, if structured properly, can help public employers address budgetary and compliance problems under Fair Labor Standards Act and Public Employees’ Medical & Hospital Care Act. As a result, many agencies are revisiting the utility of these arrangements as part of their collective bargaining and budgeting processes. Continue reading

Tagged , , , , , | Comments Off on Retiree Health Reimbursement Arrangements are Receiving More Attention

Using a Section 115 Trust to Help Manage Pension Obligations

An increasing number of cities, public agencies and special districts are investigating the use of an Internal Revenue Code section 115 trust to help them better manage the short-term costs and long-term liabilities associated with pensions. What is a 115 trust and how does it work?

Continue reading

Tagged , , , , | Comments Off on Using a Section 115 Trust to Help Manage Pension Obligations

New Home, Same Great Information

As some of you may have heard, Susan Neethling and I recently joined the law firm Best Best & Krieger LLP. Like many changes of this sort, this one was bittersweet. We are pleased, though, to continue bringing you the latest public benefits information news. We have joined a unique powerhouse in the highly specialized area of public sector benefits. The attorneys in BB&K’s Employee Benefits & Executive Compensation practice group serve more than 200 California cities and public agencies. As a team, we hope to provide more information to the municipalities, special districts, school districts and other public sector clients who rely on us for effective counsel.

Starting this week, Focus on Public Benefits is back up and running after a brief hiatus during the transition. Thank you for your patience, and, as always, I hope to hear from you soon! I can be reached at (916) 329-3685 or jeff.chang@bbklaw.com. Learn more at bbklaw.com.

Comments Off on New Home, Same Great Information

Why Hire A “3(38)” Adviser For A Public Agency 457(b) Or 401(a) Plan?

Most public sector retirement plan sponsors understand that even though their plans may not be subject to the fiduciary duties and responsibilities of ERISA, they are still subject to fiduciary duties under applicable State law.  Moreover, certain States like California have deliberately imported important ERISA concepts and standards into their State laws governing the behavior of public sector retirement administrators and fiduciaries. These duties, among other things, require plan fiduciaries to make sure that all fees and expenses paid from plan assets (that is, participants’ accounts) are necessary, appropriate and reasonable. See, e.g., Cal. Const., article XVI, section 17 and Cal. Govt. Code section 53213.5. Continue reading

Tagged , , | Comments Off on Why Hire A “3(38)” Adviser For A Public Agency 457(b) Or 401(a) Plan?