Future of Fiduciary Regs Remains Murky
It's been a year since DOL's Phyllis Borzi, addressing the 2013 ASPPA Annual Conference, provided details about how the department planned to proceed with its regulatory initiative reshaping the definition of a plan fiduciary. A year later, in the same room at the 2014 conference, ASPPA’s leadership said the real question now was much broader: Will these regulations ever actually see the light of day?
The popular Washington Update general session on the opening day of the conference featured ASPPA’s Brian Graff, Judy Miller and Craig Hoffman.
Hoffman said a lot of rumors about the regs' release have been floating around, with some sources saying the DOL will release them next month. Hoffman put that to rest, saying said that Borzi and Labor Secretary Thomas E. Perez have said the rules will come out “when they are ready,” but noting that he believes the rules will be released for a 90-day review period “at some point next year.”
“There has been speculation on how long a delay can be in order to actually get this done before the end of the Obama administration,” Hoffman said, adding that he doesn’t believe Borzi and Perez would have spent as much time lobbying industry leaders for support as they have if they didn’t intend to see the regulations through. “It’s certainly something that the DOL is committed to under its current leadership,” he observed.
While the executive branch’s personnel is more or less set until January 2017, there will be a new Congress in January and, quite possibly, a new Republican-controlled Senate. If that happens, Sen. Orrin Hatch (R-Utah), who has introduced a comprehensive pension reform bill
, would become chairman of the powerful Senate Finance committee.
Miller said she believed the Hatch bill could easily be revived in the 114th Congress, marking a change from the last two years, which Graff dryly described as “not the most robust Congress from a legislative perspective.” Hatch's bill would promote auto-enrollment IRAs for smaller employers that currently can’t afford to create plans, and to create incentives for small businesses to create plans with matching funds, backed by the federal government. If the bill moves, other retirement-related provisions could be added to it, such as doing away with the top-heavy rules and allowing part-time workers to become eligible to defer into retirement plans.
In his opening address at the beginning of the 90-minute session, which historically is one the best-attended sessions of the conference, Graff said retirement issues are on the minds of more Americans than ever before. He cited a Gallup poll
finding that retirement is the biggest financial-related concern in the country, and said that even President Obama’s MyRA starter IRA proposal
from February’s State of the Union Address, while far from perfect, was a great sign because it showed the issues that matter to ASPPA’s members matter to the administration. He added that he believes the MyRA program will begin rolling out sometime in 2015.
“The fact is that the president of the United States is talking about our issues,” Graff said, adding that retirement issues have remained a dominant part of the past two years, including being a major part of the highway-funding bill, perhaps one of the two or three most substantive laws passed thus far in the 113th Congress. “Even though there seems to be a lull, our issues are still at center stage.”