Are Your Employer “Pick-Ups” Properly Documented?

Are Your Employer “Pick-Ups” Properly Documented?

Although most public employers are familiar with the concept of a “pick-up” of employee mandatory contributions, many do not appreciate what is required to properly document a “pick-up”. This post reviews the basics of employer pick-ups and the documentation...

What Is a Section 415(m) Plan, and When Might You Need One?

What Is a Section 415(m) Plan, and When Might You Need One?

Because both the Internal Revenue Code (Code) and PEPRA sometimes “conspire” to limit the retirement benefits of public agency employees in ways that make it harder for affected agencies to hire and retain certain individuals, it may become necessary for those...

Why a Public Agency Might Want to Add a 401(a) Plan

Why a Public Agency Might Want to Add a 401(a) Plan

The vast majority of public agencies already maintain a 457(b), or eligible deferred compensation plan. A much smaller number also maintains one or more 401(a) plans in addition. This post discusses some of the reasons a public agency might want to add a 401(a) plan...

Is Your 457(b) or 401(a) Plan Fee Allocation Fair and Reasonable?

Is Your 457(b) or 401(a) Plan Fee Allocation Fair and Reasonable?

Investment fiduciaries and plan administrators of California public sector 457(b) and 401(a) plans are required by law to act as “prudent experts” for the sole and exclusive purpose of providing benefits and defraying “reasonable expenses” of administering the plan....

Is Your Social Security Replacement Plan Up to Snuff?

Is Your Social Security Replacement Plan Up to Snuff?

As we previously explained, most public agencies are not automatically subject to Social Security. They have a choice between voluntarily participating in Social Security pursuant to a section 218 agreement, or they can exempt some or all of their payroll by providing...

COVID-19 Pandemic May Force Some Cities to Reset Employee Benefits

COVID-19 Pandemic May Force Some Cities to Reset Employee Benefits

As the harsh realities of the coronavirus pandemic, along with its widespread impact on all aspects of daily life, continue to shock and numb us all, many cities have already been identified as “high risk” from a financial stability perspective by the California State...

One-time Irrevocable Elections and 401(a) Opt-in Plans

One-time Irrevocable Elections and 401(a) Opt-in Plans

There appears to be some confusion among California municipalities about 401(a) opt-in plans use and an employee’s ability to make a one-time irrevocable election to make pre-tax contributions. Because these plans are designed to give participants individual...

Taking Advantage of Governmental Retirement Plan Contribution Limits

Taking Advantage of Governmental Retirement Plan Contribution Limits

Many governmental 457(b) deferred compensation and 401(a) defined contribution plan sponsors do not take full advantage of the contribution limits for these plans. To do this, you need to understand: the limits, who they apply to, how they coordinate and your ability...

Understanding the Fees Paid by Your Governmental Retirement Plan

Understanding the Fees Paid by Your Governmental Retirement Plan

There are several fundamental principles and concepts that governmental plan sponsors and fiduciaries need to bear in mind as they select and monitor their plan providers and the fees that these providers charge. Practically all governmental plan providers use assets...

Ways to Correct Governmental Plan Problems

Ways to Correct Governmental Plan Problems

There are several tools that can be used to correct or fix governmental plan problems. First, some classification. Practically all the retirement plans we discuss are “tax-advantaged” in one form or another. However, within this group, there are three main subgroups:...

Do Not Apply AB 5 Too Broadly

Do Not Apply AB 5 Too Broadly

Perhaps the biggest news coming out of California’s Legislature this year was the passage of Assembly Bill 5 – the new law that codifies the 2018 Dynamex case and which imposes a new test for determining employee or independent contractor status for California wage...

“Encouraging” the Repayment of Student Loan Debt

“Encouraging” the Repayment of Student Loan Debt

Many of the public agencies we work with have expressed a strong interest in programs and arrangements that will help or encourage their employees to pay off their student loan debts. These programs can be important recruiting, retention and collective bargaining...

Does Your Plan Have A Proper Fiduciary Structure?

Does Your Plan Have A Proper Fiduciary Structure?

Recently, we have dealt with an "epidemic" of retirement plans, both very large and very small, that all have the same problem – the lack of a proper fiduciary structure.  Why? As with so many personnel and benefits-related programs, new managers and new advisers...