Thank you to the following who responded to my survey on implementing a loan program under the 457 Deferred Compensation Plan with ICMA. Almost all the respondents except three indicated that the loan provision may not be allowed in the 457 plan - other respondents were just interested in the result but did not have this plan in place. Lancaster - have the plan in place but have never made a loan Saratoga - indicated they have the plan in place but did not elaborate on the response Fremont - indicated they have the plan but they did not obtain a private letter ruling from the IRS Indian Wells Valley Water District - according to Tom Mulvihill, their administrator, Mutual of America, claims that IRS does not allow loans on 457 plan Camarillo - no loan provision El Centro - indicated that there is no specific provision in the statute for a loan option Porterville - under the impression that IRC code 457 does not allow loans South Tahoe Public Utility District - understand that Congress never passed 457 plan loans Berkeley - understand that IRS does not permit loans from 457 plan Visalia - do not have loan provision in their plan but interested Solana Beach - do not have loan provision in their plan but interested Rancho Palos Verdes - do not have the loan provision in their plan - chose not to when they amended their plan in 98 since ICMA offered little or no assistance for maintaining and collecting loans Mountain View - thought there was some question if IRS allowed to do loans under 457 plan - interested in definite response El Segundo - do not have the loan provision in their plan Bill Morgan of Diehl Evans & Company - indicated loan provision is not covered in the IRS Code - suggested that the City apply for a private ruling before moving forward (also cited page 106 of the firm's 1999 Government Tax Manual) See you all in Pasadena? Agnes T. Walker Financial Services Director City of Redondo Beach 415 Diamond Street Redondo Beach, CA 90277 (310) 372-1171 ext 2429 Fax (310) 937-6616
