Sens. Bob Graham, D-Fla., and Orrin G. Hatch, R-Utah, tomorrow will introduce a comprehensive bipartisan pension package that would ease the top-heavy rules that restrict small businesses from offering pension plans; allow new parents to make retroactive contributions to retirement plans for the duration of their paternity or maternity leave; shorten to three years the vesting period for employer contributions from the current five years; and make it easier for workers to take their retirement savings when they change jobs.
The senators are hoping to push for incorporation of some of the provisions in the tax bill when the Senate Finance Committee considers it next week, confirmed Chris Hand, a spokesman for Mr. Graham.
Fidelity Investments dropped fees for its $57 billion Magellan flagship fund again, based on the fund's underperformance vs. the S&P 500. Magellan is among the Fidelity funds that charge a sliding fee, which is adjusted depending on fund performance compared to a benchmark.
Fidelity announced in its monthly fund report that the average management fee in the 12-month period ended March 31 dropped to 45 basis points from an average 73 basis points for the year ended March 31, 1996. Fidelity said last month that Magellan's total fees dropped 33% last year to $245 million from $366 million in 1995. Magellan returned 13% for the year through June 10 vs. the S&P 500's nearly 17%.
A measure prohibiting Texas state investments in any media company that releases recordings with offensive lyrics such as ``gangsta rap'' likely will be signed into law after being added to the state budget appropriations bill. The state's four largest pension plans, with a combined $77 billion in assets, would be among those affected by the measure.
The measure died in the House of Representatives, which ended its session last week, but was attached to the appropriations bill by state Sen. Bill Ratliff. Gov. George W. Bush is expected to sign the appropriations bill soon. The measure is expected to be challenged and would not be effective until September 1998.
The Fairfax County Supplemental Retirement Fund, Fairfax, Va., put two managers on its watch list. At its investment committee meeting June 4, trustees of the $1.4 billion-plus system put Morgan Stanley (MS), a small-cap equities manager, on watch ``partly because of performance, partly because they just changed their manager,'' Robert C. Carlson, chairman. Morgan Stanley runs about $44 million.
Also put on watch was BEA Associates, for a $107 million U.S. large-cap equity portfolio that has underperformed for three of the last seven years, said Don McCorry, acting executive director.
The staff will recommend at the next investment committee meeting in September whether the managers should be terminated. BEA also manages fixed income for the fund, ``but that is not a concern,'' Mr. McCorry said.
A bill to create a securities and exchange commission in the Czech Republic is expected to be passed by lawmakers in July, according to Peter Kysel, a director of John Govett & Co.
According to Mr. Kysel, who is also managing director of Govett's New Europe Investment Co., the legislation was prepared by specialists at the stock exchange in Prague. The Czech Republic is the only major Eastern European country without such a commission, Mr. Kysel said.