Partners in law firms of all sizes and specialties now realize it is one thing to attract high-quality associates, but an even more difficult challenge to retain them. Competition for top-quality associates continues to intensify, so effective associate retention is more important than ever.

During the past year, we witnessed a marked increase in the number of law firms, both large and small, which are finding that their existing unfunded retirement plans are becoming significant, disruptive forces. The underlying problem created by these plans is that the plans result in current income being diverted to former partners, thereby reducing the compensation of the remaining active partners. Today, the combination of an expected spike in retirements related to the baby boom generation and, for many firms, greatly increased benefit exposure due to sharp increases in firm profitability that is factored into the value of retiree benefits, stand ready to test the financial viability of even the strongest firms.

In the first half of this decade, a series of events wreaked havoc on pension plans. Enron and other major corporations collapsed with the result that employees and other investors lost billions of dollars in savings, including in many cases significant pension investments. Sept. 11 accelerated and deepened the fall of the financial markets. Lower securities prices, coupled with low interest rates, resulted in modest investment returns and increased funding obligations for sponsors of traditional defined benefit plans. In turn, major legacy air carriers and other historical industry leaders struggled (sometimes without success) to avoid bankruptcy. In response to these and other upheavals, Congress enacted the Pension Protection Act ('PPA') on Aug. 17, 2006, only three weeks after its introduction in the House of Representatives, in an effort to reform outdated aspects of federal pension laws and to provide greater stability and overall protection to pension plan members.

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After three years of meetings and discussions not only with title companies, but also with other players in the real property industry such as lenders, realtors and government regulators, ALTA revised its 1992 forms in 2006. On Nov. 8, 2006, TIRSA filed with the Insurance Department for approval to issue the 2006 ALTA forms in New York. On March 5, 2007, the Insurance Department approved the issuance of the new 2006 forms in New York, effective May 1, 2007. The 2006 forms contain many changes from the 1992 forms with which New York real estate practitioners have grown very much acquainted. Most of the changes are rather technical and most real estate attorneys will not encounter them in their day-to-day operations. However, there are five (5) significant changes of which real estate practitioners should be aware.