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Bond In Investing Savings By Dave Porter Senior Staff Reporter

It appears that the legislative logjam found in Washington this year has partially broken through. The House of Representatives and the Senate recently passed the Pension Protection Act of 2006 (Pension Act), an extremely comprehensive pension reform measure. In fact, House Majority Leader John Boehner ( Ohio) refers to the new legislation as "the most sweeping overhaul to U.S. pension laws in more than 30 years."

Bond Investment Toledo Toledo The Senate on April 8 cleared for the President the Pension Fund Equity Act of 2004, which will allow employers to lower the amount of their required contributions immediately.

Dennis Turner, chief economist of HSBC Bank, "Businesses are in for a rough ride over the next 12 months, but it will stop short of a recession." Jon Moulton, managing partner of Alchemy, the private equity firm which once tried to buy Rover, said rescues had been made even harder because of the Pensions Act. "The Pensions Act has created some serious Catch 22s. The more trouble you are in, the more levy you have to pay to the Pension Protection Fund; can result in a company having to pay more.

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Individual investors are also interested in equity funding. This works almost exactly like an equity loan against your mortgage. Equity is established by subtracting any amount you owe from the value of your business. Lenders agree to advancing money in amounts equal to a specific percentage of your equity. Since equity funding is a type of shared ownership, some equity lenders will impose conditions on you. For example, they may want some management control.

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As the calendar year quickly approaches its end, Congress is rushing to finish its work on a number of tax bills under consideration. The House of Representatives overwhelmingly passed three tax bills on December 7, -the Stealth Tax Relief of 2005, the Gulf Opportunity Zone Act of 2005 and the Tax Revision Act of 2005. The next day, 197. The latter is a $56.5 billion measure that must now go to conference with the Senate, which passed a different version of the legislation, the Tax Relief Act on November 17.

Municipal Bonds Investment April 9, 2004 (AXcess News) Washington - The Senate on April 8 cleared for the President the Pension Fund Equity Act of 2004, which will allow employers to lower the amount of their required contributions immediately.A slow economy, along with unusually low interest rates and generous pension benefits agreed to in better times, combined to make the required plan funding too burdensome for many businesses.

"There must be hearings on this legislation, and there must be changes made to its language before it would actually serve its intended purpose. Do not ram it through on us during this lame duck session of Congress. If you do, you will enrage the millions of Americans who take dietary supplements, who flooded Congress in the 1990s, with more mail during the campaign to pass DSHEA (the Dietary Supplement and Health Education Act) than Congress ever received in its history on any issue."

Bond Terms Trading "Many companies are now faced with having to make substantial contributions to pension plans at a time when they can least afford them. These high costs could drive some companies out of business," noted CCH senior pension law analyst Nicholas Kaster, J.D. "The measure provides two-year, temporary relief to get businesses through this immediate crisis, but it's only a short-term solution to a longer-term problem."An estimated 45 million employees are covered by single- or multi- employer pension plans, with a total of one in five workers participating in a defined benefit plan. Under the legislation, pension plan benefits promised to employees remain the same, with the defined benefit plan expected to have the cash on hand when those obligations arise.

Bond Debt High In Inside The legislation replaces for 2004 and 2005, the 30-year Treasury bond rate used to calculate employers' contributions to pension plans with a long-term corporate bond rate. Companies currently use from 90 percent to 120 percent of the average interest rate for 30-year Treasury bonds maturing in 2031.

Bond Greenville Greenville "An interest rate based on long-term corporate bonds would provide a more accurate benchmark for measuring pension plan liabilities," noted Kaster.

Trading Stock And Bonds The measure also provides partial, temporary two-year relief from the deficit reduction contributions (DRCs) required of underfunded plans. It gives special relief to airlines, steel companies, and the Transportation Communications Union pension plan, allowing them to reduce contributions by 80 percent, for two years only.Multiemployer plans "most in need" also receive targeted relief under the new measure. These are plans that have had significant losses as a result of low interest rates, sizable market investment losses and a growing number of retirees. To qualify for relief, plans would have to meet specific thresholds and make a special election.

Bond Investing Municipal "As a condition of relief, employers maintaining multiemployer plans would generally not be allowed, during the deferral period, to adopt amendments that would increase plan liabilities by increasing benefits or changing the rate at which benefits accrue or become nonforfeitable," cautioned Glenn Sulzer, J.D., CCH senior pension law analyst. "However, exceptions are provided for previously negotiated benefit increases or where the plan's actuary certifies that contributions to the plan will exceed charges to the plan for benefit increases."

Basis Bond Finance Hill The legislation also requires multiemployer plans to give an annual plan funding notice to each participant and beneficiary, labor organization representing participants and beneficiaries, employer that has an obligation to contribute under the plan, and the Pension Benefit Guaranty Corporation. This applies to plan years beginning after December 31, 2004.

Bond Explained Terms Trading A special CCH news briefing on the Pension Fund Equity Act of 2004, with additional information and analysis on the legislation, can be accessed at

Bond Business Investing Stock Tax.cchgroup.com/news/taxbrief-01-04-pension-fund.pdf.AXcess News will be reporting on any new market trends related to this story. Members should watch their in-box for late breaking news. If you're not a member, consider joining now. Members get the latest business news, commentaries and stock picks delivered right to their in-box.

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