Call NRECA Early if You Are Considering Pension Plan Changes

Is your cooperative considering a change to your NRECA retirement programs for the 2016 plan year? Perhaps you’re thinking about adding Roth contributions to your 401(k) Pension Plan or revising benefit levels in the Retirement Security (RS) Plan. To receive prompt and timely guidance about these or any other changes you may be considering, contact your NRECA field representative as soon as possible.

Making changes to your retirement programs must be carefully planned. It typically involves a review of your objectives, document preparation, board approval and execution, and a legal review by NRECA to ensure amendments are properly implemented. Some plan changes also require customized benefit illustrations and necessary participant notices before the effective date of the change.

Sample Timeline
Since the first of the year is a popular date for benefit plan amendments, here is an example of the timeline to execute a simple plan change for January 1, 2016. More complex plan changes or those involving RS Plan proposals require additional time.

October
Step 1: The co-op contacts its field representative to evaluate objectives. Preliminary proposals, if necessary, are produced for the co-op to consider. Once the plan change is clearly defined, NRECA reviews it and provides guidance on the impact.

November
Step 2: NRECA produces and delivers a new plan adoption agreement or addendum, a sample board resolution, and additional required notices, if applicable.

Step 3: The co-op executes the adoption agreements or addendum and the board resolution at least 30 days before the effective date. If the change means that participant benefits are reduced, ERISA 204(h) notices may be required up to 45 days before the change. In those cases, the co-op executes the adoption agreements or addendum and the board resolution at least 60 days before the effective date of the change.

December
Step 4: The co-op returns its signed adoption agreement or addendum and board resolution to NRECA by December 1, 2015. NRECA conducts final legal and compliance review, approves the documents and makes any administrative accommodations necessary to implement the change.

If you are considering a Special Early Retirement Program (SERP) for 2015, contact your field representative by October 16, 2015. Because SERPs cannot cross over calendar years, proposals, board action, employee communications and the start of the window period must all occur by November 15, 2015. Fully adopting a SERP is typically a three-month process. SERPs started later in October may need to be deferred to the first quarter of 2016 depending on the circumstances within the SERP.

NRECA Is Here to Help
Plan changes can be a necessary part of providing competitive benefits to your employees. NRECA is here to support you. To serve you best and allow time for proper review of your plan changes, contact your NRECA field representative early to start discussing your specific needs.

If you need additional assistance, call the NRECA Member Contact Center at 866.673.2299 or email them at contactcenter@nreca.coop.