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Cypen & Cypen
March 29, 2012

Stephen H. Cypen, Esq., Editor

1.     WHY MANY AMERICANS DO NOT SAVE FOR RETIREMENT:   Amid concern about Americans’ level of preparedness for retirement and other long-term financial goals, a survey commissioned by Natixis Global Asset Management found that even many affluent people are not sure how much they need to save, say they lack money for investing and prefer to spend today rather than save for tomorrow.  Too many Americans do not know what they need to do to meet their goals, and that is limiting their ability to prepare for the future.  They are not aware of solutions available to them or simply do not have enough money available to put toward savings.  Among other key findings from the survey:

  • Some 27% of Americans are not sure how much to save or invest to meet their future needs.  The total includes 30% of investors with $300,000 to $500,000 of assets, 22% of those with more than $1 million and 18% of those over age 50. 
  • Many Americans say they do not have enough money to set aside savings.  Among them are 32% of respondents with less than $1 million in investable assets, 16% of those with more than $1 million in assets and 19% of those over age 50. 
  • One in five Americans (18%) say they would rather spend today than put money away for the future.  The survey found 22% of Americans with less than $500,000 in assets say they would rather spend than save, compared with 13% of those with more than $1 million. 

The fact that one in five Americans over age 50 do not know how much to save is especially troubling, since many baby boomers will be retired for decades.  It is particularly urgent that these Americans build their savings now, to prepare for secure retirements. 

2.      STATE NOT IMMUNE FROM JUSTICE DEPARTMENT ACTION UNDER USERRA:   The United States brought an action against Alabama Department of Mental Health.  The United States claimed that ADMH violated the Uniformed Services Employment and Reemployment Rights Act of 1994, when it failed to rehire longtime employee Hamilton after his service in Iraq with Alabama National Guard.  ADMH moved to dismiss the case based on sovereign immunity.  The federal district court denied ADMH’s motion.  The district court subsequently found that ADMH had violated USERRA by not immediately rehiring Hamilton after his return from Iraq.  The district court ordered ADMH to pay more than $25,000 for the wages and benefits that Hamilton lost because of ADMH’s failure to comply with USERRA.  On appeal, the appellate court held that ADMH was not entitled to sovereign immunity, that the district court did not err in finding that ADMH violated USERRA and ADMH was properly required to pay money damages.  If Hamilton had been plaintiff, it is undisputed that sovereign immunity would have barred his suit because a state cannot be sued by an individual without its consent. ADMH acknowledges, however, that states do not have immunity from federal court suits, brought and controlled by the United States, seeking to vindicate the general interests of the federal government. ADMH contends that Hamilton, and not the United States, is the real plaintiff in the lawsuit. The court of appeals disagreed:  It is well-settled that the United States may obtain victim-specific relief in behalf of a particular individual without offending the Eleventh Amendment.   In addition, the United States was not required to show that Hamilton would have taken a position if one had been offered.  United States of America v. Alabama Department of Mental Health and Mental Retardation, Case No. 10-15976 (U.S. 11th Cir., March 16, 2012). 
3.      EX-WIFE WHO, DESPITE WAIVER RECEIVED PROCEEDS OF EX-HUSBAND’S 401(K) PLAN, MAY BE LIABLE TO HIS ESTATE FOR RETURN OF SAID PROCEEDS:   William enrolled in a 401(k) plan through his employer.  The plan was governed by Employee Retirement Income Security Act.  At the time of enrollment, William was married to Adele, whom he designated as the plan’s primary beneficiary.  Their marriage did not last, however, and divorce proceedings commenced.  The parties entered into a property settlement agreement, which provided that the parties mutually agreed to waive and relinquish any and all rights either may have to the other’s IRA accounts or any other such retirement benefit and neither shall make a claim to possession of such property as it is presently titled.  The final divorce decree incorporated the property settlement agreement.  William died intestate, without having changed the designated beneficiary of his 401(k) plan.  Although Adele was still named beneficiary of the 401(k) plan, William’s estate argued that, given her waiver, it was entitled to the proceeds of the plan.  Adele countered that ERISA, which requires that the proceeds be paid to the beneficiary named in the plan documents, trumped her commonlaw waiver.  The estate filed an action against Adele and the employer in state court, seeking a declaration that the estate was entitled to the funds in the 401(k) account.  The employer removed the matter to the federal district court.  In light of a recent Supreme Court of the United States case, there was no dispute that, notwithstanding Adele’s waiver, the plan administrator was obligated to pay the 401(k) proceeds to her in accordance with the plan documents.  The question on appeal, one of first impression in the third circuit, was whether after the plan administrator distributed the funds to Adele, the estate can attempt to recover the funds by bringing suit directly against Adele to enforce her waiver.  The appellate court held that the estate can sue Adele to enforce her waiver and recover the disputed plan proceeds.  To the extent that the federal district court held to the contrary, its decision was reversed.  ERISA does not address whether waiver of benefits can be enforced through a direct suit against a named beneficiary once the benefits have been paid to that beneficiary.  In an action brought directly against Adele after the benefits have been distributed to her would in no way complicate the employer’s administration of the plan.  In addition, a post-distribution suit against Adele would neither destroy a plan administrator’s ability to get clear distribution instructions, without going to court, nor subject the employer to litigation-fomenting ambiguities.  Rather, a suit against Adele would simply require a court to determine the rightful recipient of the plan proceeds as a matter of contract law.  Estate of Kensinger, v. URL Pharma, Inc.; Case No. 10-4525 (U.S. 3rd Cir., March 20, 2012). 
4.      MOST AMERICANS DO NOT CONTRIBUTE TO IRAs FOR RETIREMENT SAVINGS:   Only 22 percent of Americans say they are saving for retirement by contributing to an Individual Retirement Account, according to a survey by TIAA-CREF.  An IRA can provide a tax-advantaged way to save for retirement.  For the 2011 and 2012 tax years, investors can contribute up to $5,000 -- or up to $6,000 for those age 50 or older -- to a traditional IRA, a Roth IRA or both.  Yet research found that 38 percent of Americans who own an IRA are contributing up to the annual limit, and 55 percent are investing less than the maximum allowed amount each year, missing out on the opportunity to maximize their tax and savings benefits. Seventy-six percent of those polled say they are not currently contributing to an IRA!  The survey also revealed that 62 percent of investors were unaware of two noteworthy IRA features:  catch-up contributions that allow investors age 50 and older to contribute more than the annual maximum and Roth IRA withdrawal guidelines that allow contributors to withdraw money without paying taxes or penalties.  Other notable survey findings include:

  • Women and baby boomers most likely to contribute to the maximum - Among those currently contributing to an IRA, the survey found that 41 percent of women are more likely than men (34 percent) to contribute up to the annual maximum for an IRA.  At 52 percent, baby boomers of both genders are most likely fully to fund their IRA each year, and 45 percent of college graduates of all ages report they invest the maximum allowed amount annually.  
  • Younger Americans unaware of the benefits of an IRA - Younger Americans (ages 18-34) know least about the benefits of using an IRA as a retirement investment tool. Seventy-three percent of those age 18-34 are unaware of the maximum amount of money one can contribute to an IRA annually -- which was 12 percentage points higher than the average of all adults who participated in the survey.  Fifty-eight percent of those in this age range do not know that IRA contributions grow on a tax-deferred basis.  
  • Income levels also play a significant role in saving for retirement - Just 8 percent of Americans earning less than $35,000 a year contribute to an IRA, and 13 percent of Americans earning $35,000 to $50,000 annually contribute to an IRA.   

With the attacks on defined benefit plans growing stronger and more frequent, Americans better start to think about some back-up.

5.      DEALING WITH INFLATION:    J.P. Morgan Asset Management has just issued a piece entitled “Keepin’ it Real – Inflation Risk as an Asset Allocation Problem.”  Just last year, media reports were sounding alarm bells over higher inflation -- prompting investors to add some form of inflation protection to their portfolios. But in wake of the Eurozone debt crisis and the prospect for slower growth, inflation fears have eased.  Does that mean the need for inflation protection has passed?  Hardly.  Regardless of one’s view on where inflation is heading, such questions highlight a major weakness in the way institutions address inflation risk, which is to add inflation-sensitive or real assets only when inflation is already on the rise.  Investors often see inflation risk primarily as a rapid inflationary spike to 4% or higher, rather than a long-term challenge that can hurt portfolios.  However, the more common scenario is a low inflationary environment accompanied by a bear market – an environment that often results in negative real returns.  Furthermore, what we do not know about inflation can be more dangerous than what we do know. The drivers -- and effects – of inflation change from one period to the next, as policy responses to inflation evolve.  At the same time, we can never entirely predict how different asset classes will react to inflation in the future, in part, because their performance also can be significantly affected by business cycles.  This challenge is even more difficult for some favored inflation-sensitive assets that have no historical track records in periods of high inflation.  Despite -- or perhaps, because of -- such uncertainties, we believe the current situation presents a perfect opportunity to re-examine broader questions about inflation as it relates to portfolio design.  As practitioners and fiduciaries, we seek to protect investors across all inflationary environments.  But because we cannot effectively predict them, we believe the most pragmatic approach is to be agnostic to inflation’s causes and characteristics. So, here are the following issues to be considered: 

  • What problem are we trying to solve?  In other words, how significant is inflation risk in historical or empirical terms? 
  • How do you define the problem?  How should an investor define inflation risk in a specific portfolio? 
  • How can investors assess cost of inflation protection? 
  • Is there an optimal strategy to managing inflation risk? 

The goal in asking these questions is to construct a framework to address diverse forms of inflation that can be utilized by investors regardless of the environment.  This holistic approach -- which is based on empirical analysis -- is optimal for managing inflation risk across all of its cycles, whether it is high or low, or rising or falling.  Here, then, are five key findings revealed by an analysis of the data: 

  • Cyclicality: Inflation tends to move in cycles.  Empirical evidence suggests that there are small, episodic periods of rising or falling inflation marked by larger regime shifts – ranging from prolonged periods of moderate inflation to periods of extreme and volatile inflation.  Viewed from that perspective, inflation risks are really short-term uncompensated risks that can hurt investor returns across assets or erode their purchasing power. 
  • Inflation shocks are not the biggest risk to portfolio returns:  Data indicate that the most common inflation risk scenario is a period of low inflation combined with a bear market, resulting in negative real returns.  The risk of negative real returns happens most commonly during periods of low inflation, not high inflation. 
  • Insurance against unexpected inflation: In the long run, an asset’s expected return will have inflation expectations embedded in it, paying the investor a premium for bearing the risk.  However, inflation risk is also the risk of short-term unexpected inflation that is not compensated by the embedded premium.  Investors can anticipate and protect against such risks, but must understand that every insurance policy has a cost during those times when the hedge is on, but inflation is not. 
  • Every asset comes with risks: Similarly, every inflation-protection strategy carries with it specific asset class risks. Because narrow solutions do not work consistently, we believe there is no such thing as a silver bullet.  Inflation-protection strategies should be diversified and designed within the context of the investor’s total objective.  Only in this way can one gain inflation protection without compromising the portfolio’s other goals, such as liquidity, return targets and volatility constraints. 
  • Narrow solutions are inappropriate: A single, simplistic inflation-protection strategy cannot account for all of the variables in inflation risk, such as cyclicality, correlation (or lack of) to the business cycle, wide variance in asset performance under different inflationary regimes and potential costs of adding inflation protection at the wrong time. 

As is the case with most investment challenges, diversification is key as it provides greatest protection -- not just from inflation in all its forms -- but also from unknown risks.  The paper explains why managing inflation risks should not be approached as a portfolio add-on, but rather as a core component of the portfolio modeling and construction process.  Investors should customize their inflation-protection strategy based on individual objectives and time horizons, which can, in turn, be used to determine parts of the inflationary cycle that pose the greatest threat to them. 

6.      WHAT ALTERNATIVE INVESTMENT MANAGERS NEED TO KNOW ABOUT ATTRACTING PENSION PLAN ASSETS:     PricewaterhouseCoopers has issued a paper entitled “Attracting Pension Plan Assets – What Alternative Investment Managers Need to Know.”  Retirement plan sponsors are continuing to give alternative investments, including hedge funds and private equity funds, a closer look.  They continue to be attracted by the lower historical volatility, higher absolute and risk-adjusted returns and varied correlations these funds can offer relative to traditional investment advisor portfolios.  While plan sponsors continue to be attracted to the performance characteristics of alternative investments, they also are seeking increased levels of information on their operational complexities in order to address the total risk (investment and operational) funds pose to pension assets.  Alternative investments must recognize the holistic nature of additional information data requests.  These data allow managers flexibility in promptly and effectively satisfying increased transparency requirements of institutional investors.  Here are some concerns that plan sponsors have: 

  • Market risks.  Alternative investments involve varying degrees of market risk, including equity, interest rate, foreign exchange and commodity risks.  These risks can be exacerbated by the use of leverage. 
  • Illiquidity.  Fund managers sometimes invest in exotic instruments or other less-liquid investments, reducing the possibility of a quick exit for investors.  This illiquidity can be especially troublesome if multiple investors try to exit a hedge fund simultaneously, forcing the fund manager to unwind multiple positions to meet requests.  In private equity funds, the lock-up period may be far longer, possibly between five and ten years. 
  • Valuation.  Certain hedge fund strategies involve investments in less-liquid hard to value instruments such as distressed debt, direct loans, private equity or complex financial derivatives. 
  • Operational complexities.  The operational complexities associated with executing many hedge fund strategies often times include risks related to back-office systems and controls, appropriate segregation of duties amongst personnel, execution accountability, legal review, regulatory readiness, as well as a number of other factors.  In particular, operational risks are at their greatest when inadequate internal control environments exist.  One such example is when the day-to-day operations are overseen by the same personnel who manage the portfolio, indicating a lack of effective segregation of duties between front- and back-office personnel.  Additionally, these risks are exacerbated when the internal control environment is inadequate to mitigate the inherent risks in portfolio pricing and securities valuation. 
  • Regulatory Obligations.  Many hedge and private equity funds are not registered under the Investment Company Act of 1940 and lack the protections associated with mutual funds. 
  • Strategy risk.  Active portfolio management can lead to deviations from the stated strategy.  This style drift creates investment planning and risk control issues for investors, such as using a mismatched benchmark and higher tracking error.  Other concerns include the manager straying from his area of expertise and lower diversification of a pension plan’s overall portfolio if the implemented strategy is more closely correlated than expected with other assets in the portfolio. 
  • Counterparty risk.  Although hedging strategies seek to reduce the risk of losses associated with downward price movements, there still are residual inherent risks present in a portfolio, such as counterparty risk.  For instance, in any transaction in which one party is reliant on another to complete the transaction, the investor is exposed to counterparty risk.  This issue is one for hedge funds and private equity funds due to, in part, their use of leverage or over-the-counter trading transactions. 
  • Sub-advisor risk.  Investors have experienced tremendous market volatility, fraudulent investment schemes and increased regulatory scrutiny.  As a result, they seek more transparency from their investment managers. 
  • Vendor selection.  The stability of third-party vendors in providing middle- and back-office services is increasingly critical, since these vendors frequently are instrumental to a manager’s operations. 

The growing popularity of hedge funds, private equity funds and other alternative investments among pension plan sponsors makes this an opportune time for the managers of these funds to ramp up their marketing efforts to this key investor base.

7.      PUBLIC AND PRIVATE EMPLOYERS CAN TAKE STEPS TO ENSURE COMPETITIVE, SUSTAINABLE BENEFITS:   Employers across America face unprecedented challenges in providing competitive employee benefits while still controlling costs.  Public sector employers face additional obstacles from revenue shortfalls and increased public scrutiny of government spending.  Yet employers -- both public and private -- have access to many proven solutions that can help them control and even reduce costs, while continuing to offer a strong benefits package.  The foregoing is one of the key findings in a new white paper released by Colonial Life & Accident Insurance Company. “Preserve and Protect:  How Public Sector Employers Can Provide Excellent Benefits While Controlling Costs” uses proprietary and industry research and case studies to explain the reasons for the growing cost pressures and show effectiveness of multiple strategies to contain employee health benefits costs.  The cost of family health care coverage has doubled in the last decade, increasing 9 percent in 2011 over the previous year.  At the same time, state and local governments are facing significant financial stress from the most recent recession.  Their revenues declined 22 percent from 2008 to 2009.  The white paper examines five strategies that research shows to be effective in controlling costs: 

  • Wellness initiatives- Wellness initiatives were among the top cost-control strategies implemented by employers in a recent survey of government financial officers.  Nearly 80 percent of survey respondents have added wellness initiatives to their benefits program, and 90 percent of those recommend them to others; nearly two-thirds recommend them strongly.  
  • Pretaxing benefits/Section 125 participation- Equaling wellness programs as a highly implemented and recommended cost-control strategy is establishing Section 125 plans and maximizing employees’ participation in pretax benefits programs.  Seventy-seven percent of employers in the government financial officers survey say they offer pretax benefit plans, and 86 percent of those recommend this option. In fact, at 73 percent highly recommended, it was the most enthusiastically endorsed strategy of the survey options and only 3 percent were unlikely to recommend it. 
  • Benefits communication and education- Employers can transfer the cost of benefits plan communication to their benefits suppliers and can outsource an enrollment system and open enrollment management rather than maintaining these responsibilities in-house.  
  • Voluntary benefits- One underutilized solution to the benefits cost problem is to move noncore benefits to employee-paid voluntary benefits.  This strategy is another example of a change that fewer public sector employers have yet to implement, but those who do give it very high marks.  
  • Dependent verification- Providing insurance coverage for dependents who are no longer eligible drives up benefits costs for employers.  Health plan audits can reveal a significant number of ineligible participants, including dependents who are over age or who are not a blood relative or a spouse or former employees who have not been removed from the plan.  

Government employers who implemented strategies such as those above report significant savings in their employee health care benefits.  Fifty-five percent of participants in the government financial officers study saved at least 6 percent, and 40 percent of them saved more than 10 percent.  Other studies show employer return on investment for wellness initiatives ranging from $3 to $6 for every dollar spent. 

8.      FIVE MOST CONTROVERSIAL EMPLOYEE BENEFITS:   Employers tread a thin line ensuring their benefits and program offerings are compliant with laws and regulations and respectful of a diverse population of employees.  Sometimes, these debates go beyond water cooler chit-chat, and enter the larger, mainstream discussion.  Employee Benefit News has compiled five employee benefits that have spurred caustic debate, both inside and outside the Human Relations/benefits sphere: 

  • Birth control.  What originally was seen as a small detail in President Obama’s health care reform law, determining how to provide birth control to women employed by the Catholic Church has ballooned into a polarizing sound-off among policymakers, religious leaders and a bombastic radio host. 
  • Same-sex benefits.  A federal judge recently ruled that the government could not deny employee spousal benefits to the wife of a lesbian court employee, thereby finding the Defense of Marriage Act unconstitutional.  Many private employers already provide benefits to same-sex couples and domestic partners, although they must make special considerations for tax purposes. 
  • Public pensions.  Pension contracts with public employees and unions have suffered attacks from citizens and state leaders in recent years due to the recession and government budget concerns.  Although many private-sector pensions already have closed benefits to new entrants, they continue to appear in the news, such as American Airlines’ attempt to terminate pensions for 130,000 workers. 
  • Health benefits for transgendered employees.  Still a taboo topic for some, employee benefits that focus on health needs of transgendered workers are becoming more popular.  In fact, one-third of major employers now offer transgendered employees coverage for gender-reassignment surgery. 
  • Limited medical plans.  Despite restrictions on annual dollar limits of health plans under the Patient Protection and Affordable Care Act, the Department of Health and Human Services has permitted some employers, such as McDonald’s, to obtain temporary waivers so they can continue to offer health plans with limited benefits (including the so-called mini-med plans) until health insurance exchanges begin facilitating coverage in 2014. 

9.      SEC INVESTOR BULLETIN ON MUNICIPAL BONDS:    U.S. Securities and Exchange Commission has issued a new Investor Bulletin to help educate individual investors about municipal bonds.  Municipal bonds (or “munis” for short) are debt securities issued by states, cities, counties and other governmental entities to fund day-to-day obligations and to finance capital projects such as building schools, highways or sewer systems.  By purchasing municipal bonds, a purchaser is in effect lending money to the bond issuer in exchange for a promise of regular interest payments, usually semi-annually, and return of the original investment, or “principal.”  A municipal bond’s maturity date (the date when the issuer of the bond repays the principal) may be years in the future.  Short-term bonds mature in one-to-three years, while long-term bonds will not mature for more than a decade.  Generally, interest on municipal bonds is exempt from federal income tax.  The interest may also be exempt from state and local taxes if the owner resides in the state where the bond is issued.  Bond investors typically seek a steady stream of income payments, and, compared to stock investors, may be more risk-averse and more focused on preserving, rather than increasing, wealth.  Given the tax benefits, the interest rate for municipal bonds is usually lower than on taxable fixed-income securities such as corporate bonds.  The two most common types of municipal bonds are  
General obligation bonds, issued by states, cities or counties and not secured by any assets.  Instead, general obligation bonds are backed by the “full faith and credit” of the issuer, which has the power to tax residents to pay bondholders.  
Revenue bonds are not backed by government’s taxing power, but by revenues from a specific project or source, such as highway tolls or lease fees.  Some revenue bonds are “non-recourse,” meaning that if the revenue stream dries up, the bondholders do not have a claim on the underlying revenue source. 
As with any investment, investing in municipal bonds entails risks.  Investors in municipal bonds face a number of risks, specifically including: 
Call risk.  Call risk refers to the potential for an issuer to repay a bond before its maturity date, something that an issuer may do if interest rates decline -- much as a homeowner might refinance a mortgage loan to benefit from lower interest rates.  Bond calls are less likely when interest rates are stable or moving higher.  Many municipal bonds are “callable,” so investors who want to hold a municipal bond to maturity should research the bond’s call provisions before making a purchase.  
Credit risk.  Credit risk is the risk that bond issuer may experience financial problems that make it difficult or impossible to pay interest and principal in full (the failure to pay interest or principal in full is referred to as “default”).  Credit ratings are available for many bonds. Credit ratings seek to estimate the relative credit risk of a bond as compared with other bonds, although a high rating does not reflect a prediction that the bond has no chance of defaulting.  
Interest rate risk.  Bonds have a fixed face value, known as “par” value.  If bonds are held to maturity, the investor will receive the face value amount back, plus interest that may be set at a fixed or floating rate.  The bond’s market price will move up as interest rates move down and it will decline as interest rates rise, so that the market value of the bond may be more or less than par value.  U.S. interest rates have been low for some time.  If they move higher, investors who hold low fixed-rate municipal bonds and try to sell them before they matured could lose money because of the lower market value of the bonds. 
Inflation risk.  Inflation is a general upward movement in prices.  Inflation reduces purchasing power, which is a risk for investors receiving a fixed rate of interest.  It can also lead to higher interest rates, and in turn, lower market value for existing bonds. 
Liquidity risk.  Liquidity risk refers to the risk that investors will not find an active market for the municipal bond, potentially preventing them from buying or selling when they want and obtaining a certain price for the bond.  Many investors buy municipal bonds to hold them rather than to trade them, so the market for a particular bond may not be especially liquid and quoted prices for the same bond may differ. 
For additional information about municipal bonds or other investments, investors can call SEC’s Office of Investor Education and Advocacy at 800-SEC-0330.  SEC Risk Alert (March 19, 2012). 
10.    ST. LOUIS FIREFIGHTERS WILL SUE IF PENSION OVERHAUL BECOMES LAW: reports that the St. Louis firefighter retirement system has authorized hiring a lawyer to sue the city if either of the mayor’s pension overhaul bills pass into law.  In a closed (huh?) meeting, five of eight trustees voted to authorize a contract with the board’s lawyer to handle the suit.  The mayor has proposed two bills that would take control of the firemen’s retirement system and greatly reduce benefits.  Firefighters, pension trustees and some city officials have argued that the mayor’s bid is illegal without an accompanying state law authorizing the move.  They also say the state constitution forbids any changes to benefits for current employees, including future benefits.  The vote to sue had been building for weeks.  At a meeting where the fire chief was absent, the board only had four votes present to sue.  But the mayor’s new appointee objected, insisting the law required five votes.  The fifth vote, the fire chief, eventually showed up at the meeting.  The mayor talked to the chief on the telephone to express his extreme disappointment at the chief’s vote to use taxpayer dollars to sue the city.  However, the chief would not explain his reasoning.  No kidding. 
11.    KENTUCKY MAY RETIRE CONFEDERATE PENSION FUND:  A Kentucky senate committee has voted unanimously to do away with the state’s Confederate Soldiers Pension Fund.  The KentuckyCourier-Journal reports that a committee took action on what some Southerners still call the “War of Northern Aggression,” to strike from state law all of section 206, which lays out the particulars of the pension program.  If House Bill 85 passes the full senate, gone will be the generous $50-per-month pension for Civil War veterans and their widows.  No more will there be a $100 death benefit to help pay for burials.  There is no issue of cost, inasmuch as no one has drawn a Confederate pension in Kentucky for well over 50 years. 
12.    GOLF WISDOMS:     It's surprisingly easy to hole a 50-foot putt when you lie 10.       
13.    PARAPROSDOKIAN:  (A paraprosdokian is a figure of speech in which the latter part of a sentence or phrase is surprising or unexpected in a way that causes the reader or listener to reframe or reinterpret the first part.  It is frequently used for humorous or dramatic effect.):  “A modest man, who has much to be modest about.” -- Winston Churchill (said of Clement Attlee)    
14.    QUOTE OF THE WEEK:   “Always do right; this will gratify some people and astonish the rest.”  Mark Twain  
15.    ON THIS DAY IN HISTORY:  In 1971, First Lieutenant William L. Calley, Jr. found guilty in My Lai (Vietnam) massacre.  
16.    KEEP THOSE CARDS AND LETTERS COMING: Several readers regularly supply us with suggestions or tips for newsletter items.  Please feel free to send us or point us to matters you think would be of interest to our readers.  Subject to editorial discretion, we may print them.  Rest assured that we will not publish any names as referring sources. 
17.    PLEASE SHARE OUR NEWSLETTER:  Our newsletter readership is not limited to the number of people who choose to enter a free subscription.  Many pension board administrators provide hard copies in their meeting agenda.  Other administrators forward the newsletter electronically to trustees.  In any event, please tell those you feel may be interested that they can subscribe to their own free copy of the newsletter at  Thank you.


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Items in this Newsletter may be excerpts or summaries of original or secondary source material, and may have been reorganized for clarity and brevity. This Newsletter is general in nature and is not intended to provide specific legal or other advice.

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