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News from Washington, DC

The collapse of the Enron corporation has sent shock waves from Houston to Wall Street to Capitol Hill. Wherever you are, the now infamous implosion of the energy giant has made headlines. American workers, already shell shocked by a turbulent equities market, have new reason to fear for their 401(k) lives. Congress, never missing an opportunity to wear a white hat, has pledged to "Protect Americas Pensions."

Of course there are many different opinions on how to accomplish this. For months, Congress has been investigating, meeting, and debating. Legislation has been introduced in both houses, and has been passed in the House. The Senate is still considering various courses of action, with an uncertain resolution. The Senate and House will likely be far different, with much of the important work to be done in conference committee.

In order to capture the flavor of the debate on Capitol Hill, SVIA has asked various experts from different corners of Washington, DC, for their opinion. Those opinions can be found in the center of this issue. SVIA thanks those who have participated in this venture and encourage members to respond to these pieces with "Letters to the Editor." Comments can be submitted to me via email, nick@stablevalue.org, or at SVIA, 2121 K Street, NW, Suite 800, Washington, DC 20037.

The chart below details the legislation that is being considered in both houses.

Provision	H.R. 3762 (Passed)	S 1992 (reported from Health Committee)
Investing in Employer Securities		Allows plans to permit elective deferrals to be invested in employer securities, or to make employer contributions in employer securities; but, prohibits a plan from doing both.
Vesting	Allows investors to divest themselves of employer stock held in their plan as a result of employer contributions after holding those contributions for three years. (Rolling three years).	Allows investors to divest themselves of employer stock held in their plan as a result of employer contributions after three years of service.
Investment Options	Requires employers to offer three other investment options and quarterly opportunities to choose among such options.	Requires a plan offer three investment options in addition to employer securities.
Advice	Would provide ERISA and Internal Revenue Code exemptions for: · The provision of investment advice to plan or participants, · The sale, acquisition, or holding of investments pursuant to this advice, and · The receipt of fees for the advice or the investments.	Exempts plan sponsors from fiduciary liability for plan investments only if the plan designates an independent investment advisor, who shall be fiduciaries with respect to such investments.
"Blackout" Periods	Requires plan administrators to provide 30 days notice of a suspension of activity.	Requires plan administrators to provide 30 days notice of a suspension of activity.

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