Author: jfortenberry@fortenberrylaw.com

This article–Report: State Budget Cuts Hurting Disabled— referred to by Jeanne Pi in The Texas Elder Law Blog states that the U.S. Supreme Court last year issued four decisions against the disabled. The article goes on to say that one of the rulings against the disabled was that “disabled people cannot demand jobs that would threaten their lives or health.” I was struck with incredulity over the statement. This is bad? Then I ventured over to How Appealing to read this post which just happened to mention the case as well.

Today, the federal government will mail the first of more than 25 million checks for tax savings brought about by the Jobs and Growth Tax Relief Reconciliation Act of 2003. According to the Internal Revenue Service, the checks represent an advance of this year’s child tax credit increase and will go to most parents who claimed the credit on their 2002 returns. You can access the IRS’s mailing schedule and other information here. Also, the IRS has a nifty feature to let taxpayers know the amount and mailing date of their advance payment checks. Click on “Where’s My Advance Child Tax Credit?” and enter the information requested to check on the status of a payment. The status check will also tell if a payment may be reduced because of taxes owed or an outstanding non-tax federal debt, or why a taxpayer with a child does not qualify for an advance payment. This Web feature should have information for a taxpayer about 11 days before the check mailing date. Currently, the information covers taxpayers whose checks will be mailed this week and next, as well as taxpayers who have children but are not eligible for an advance payment. By July 28, it should have information for all taxpayers included in the initial mailings. The system will be updated weekly with data from returns as they are processed.

France voted to overhaul its pension sytem as reported here by the Boston Globe: “France overhauls pension law.” This came despite weeks of protests by French workers in May and June as previously reported on here.

United Airlines is pushing aggressively for legislation that would allow the company to defer payments to its massively under-funded pension plans, the company’s chief executive said Thursday, as reported by Anne C. Mulkern for the Denver Post in this article: “United pushes for pension-plan help: Airline wants to defer payments to ailing fund.”

You can also read this interesting story about pension rights for elephants in India as reported by the BBC: “Pension rights for Indian elephants: Elephants employed by the state of Kerala in southern India are to be granted full retirement benefits at the age of 65.” (I even heard Paul Harvey refer to this story yesterday as we were listening to him on our way back from Chincoteague Island.)

The Wall Street Journal carried an op-ed on Tuesday by Peter R. Fisher, undersecretary of the Treasury: “Redefined Benefits.” (Subscription required.) The article stated that “[d]iscounting pension liabilities over the long term using a single, one-size-fits-all corporate bond rate would lead to systematic underfunding of pension plans with predominantly older workers.” Another op-ed in the Journal on the same day–“Pension Reform For Fruitcakes“–states that “the House Ways and Means Committee ducked wider reform by voting a quick fix: Pension plans would get the fat carrot of replacing the 30-year Treasury rate with a corporate bond rate.”

After a wonderful three days at Chincoteague Island in Virginia with the family, it is great to be back! While we did not get to see the annual Pony Penning which apparently takes place next week, we were able to see the famous herds of ponies which make their home on Assateague Island and enjoy many of the other island attractions as well.

Here is today’s Federal Register. Since I have been unable to post here from July 22-24th, previous Federal Registers for July 22-24th can be accessed here.

The U.S. General Accounting Office has concluded that the single-employer pension insurance program of the Pension Benefit Guaranty Corporation (“PBGC”) is at “high risk” and has added it to the list of major federal programs that need “congressional and agency action.” You can access the report here. The report provides that the single employer insurance program has moved from a $9.7 billion accumulated surplus in 2000 to a $3.6 billion accumulated deficit in fiscal year 2002 and that, as of April 2003, the program’s unaudited deficit was an estimated $5.4 billion, the largest in PBGC history. The report cites terminations of large underfunded pension plans of bankrupt firms in troubled industries like the steel and airline industries, declines in the stock market, declines in interest rates, and certain weaknesses in the current funding rules, as contributing to the program’s weakened condition. Also, the report provides that these “factors mask broader trends that pose serious program risks”:

For example, the program’s insured participant base continues to shift away from active workers, falling from 78 percent of all participants in 1980 to 53 percent in 2000. In addition, the program’s risk pool has become concentrated in industries affected by global competition and the movement from an industrial to a knowledge based economy.

The Wall Street Journal carried this article by Ellen Schultz on the GAO report: “GAO Sees ‘High Risk’ At U.S. Pension Insurer.” (Subscription required.) The article quotes David Walker, the comptroller general of the GAO as saying that the office favors tougher rules requiring employers to increase minimum funding of their pension plans, and also favors increases in the premiums that employers pay to the PBGC, moves that are supported by the Treasury and the insurer. The article also reports that the House Committee on Education and the Workforce announced its intention to hold a hearing on the financial health of the PBGC during the first week of September.

Forbes also reports: “Agency backing U.S. pensions put on risk list.”

I am taking a little R & R for the next few days. As posts will probably be slim to none here until Friday, please feel free to check out the many links over on the right for some good reading.

Also, one of the world’s shortest jokes from Eugene Volokh:

Pretentious? Moi?

And some fun for those who have not yet experienced the joys of this silly little helicopter (sent to me from a number of sources, the latest being from Tom Mighell via his Internet Legal Research Weekly).

ERISAblog: 2d Circuit Case on Deficient SPDs Testing trackback

Mark Hamblett for the New York Law Journal via Law.com has this article on the very recent Second Circuit ERISA case of Burke v. Kodak Retirement Income Plan: “Deficient Benefit Plan Not Enough to Overcome Denial of Benefits.” More on this case later . . . (By the way the title to the article should likely read “Deficient Benefit Plan Description Not Enough to Overcome Denial of Benefits.”)

PlanSponsor.com has this article on what’s in the Portman-Cardin substitute bill which was approved by the House Ways and Means Committee on Friday: “Pension Bill (Still) Contains Some Welcome Relief, Controversy: The late introduction of a substitute amendment for pension reform touched off a firestorm in the House Friday – but what was in the bill?”

TheStreet.com has this op-ed by Jonas Max Ferris: “The Downside of Restricted Stock.”