James A. Klein, president of the American Benefits Council (ABC) said the American Jobs and Closing Tax Loopholes Act (H.R. 4213) includes provisions allowing single-employer and multiemployer pension plans an extended amortization of losses suffered in the recent market decline.
“The unprecedented ‘perfect storm’ of depressed financial markets, low interest rates and new pension funding rules has artificially inflated companies’ defined benefit pension obligations,” Klein said, in a statement. “Millions of dollars, normally earmarked for job creation and capital investment, are now being diverted into already healthy pension funds. This relief will help companies invest in jobs and infrastructure.”
According to Klein, the bill also imposes new disclosure requirements on defined contribution plans.
“We appreciate the efforts of Representatives George Miller (D-California) and Richard Neal (D-Massachusetts), who worked with us to ensure the transparency and security of workplace savings plans,” Klein said. “We remain concerned, however, that the effective date for adoption of these new rules is unworkable given the need for extensive regulatory guidance, as these new rules will require substantial changes to existing systems and procedures. We intend to work with the U.S. Department of Labor to obtain a ‘good faith’ standard for compliance with the new rules.”