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Internal Revenue Code (IRC) § 162(m) imposes a $1 million deduction limit on compensation paid by a public corporation to certain executive officers. However, an exception applies to “qualified performance-based compensation,” which does not count against the deduction limit. Stock options may qualify for this exception if certain conditions are met, one of which is to specify a limit on the stock option grants. The Internal Revenue Service recently issued proposed regulations that clarify that the stock option plan must specify the maximum number of shares that may be granted to any individual employee during a specified period. If the plan merely states an aggregate maximum number of shares that may be granted during a specified period, and does not contain a specific per-employee limit, stock options will not qualify for the exception.
On September 6, 2011, the Securities and Exchange Commission (SEC) confirmed that it will not seek a rehearing of the decision by the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) that vacated an SEC rule, commonly known as the “proxy access” rule, that would have enabled certain shareholders of public companies to propose director nominees for inclusion in their company’s proxy materials. The SEC also confirmed that it will not seek Supreme Court review of the decision.
On September 15, 2011, the Securities and Exchange Commission (SEC) issued a final rule to adopt amendments to the proxy access rules for shareholder proposals in Rule 14a-8, which was discussed in our September 2011 issue of FredNEWS: Corporate & Securities. In a related action, on September 27, 2011, the SEC published an amended Form 8-K that includes a new Item 5.08 requiring, in certain circumstances, companies to disclose applicable deadlines for shareholders to submit proxy access proposals. On November 17, 2011, Institutional Shareholder Services, Inc. (ISS) published its 2012 Corporate Governance Policy Updates and Process Executive Summary, which refined how it will address proxy access, among other policy changes.
Cities Are Back in the Variance Business: Legislature Removes Roadblock to Variance Applications by Making Much-Needed Changes to Variance Statutes
In 1989, the Minnesota Court of Appeals issued its decision in Rowell v. Board of Adjustment of Moorhead. In this decision, the Court of Appeals adopted an interpretation of Minnesota’s municipal variance statute that provided a flexible, owner-friendly standard for cities to use when evaluating variance applications. Following the Rowell decision, business was good for those applying for variances. While not every variance was granted under the standard adopted in Rowell, the standard was sufficiently lenient that variances became a tool that owners and developers routinely used to obtain approvals for their projects and developments.
On July 28, 2011, Patricia Winget, the Adviser to the Minnesota Commissioner of Health, reversed a maltreatment determination issued by the Office of Health Facility Complaints (OHFC). OHFC incorrectly asserted that a large, non-profit Minneapolis skilled nursing facility committed neglect of supervision when a resident in a wheelchair died from injuries sustained in a fall down a stairwell. Nursing home staff reached the resident within seconds after the resident gained access to the stairwell, but were unable to prevent the death.
North Dakota Senate Bill 2206 recently signed into law by the Governor, as North Dakota Century Code Section 2-05-21, changes the requirements for anemometer towers. The law was passed with an emergency clause and is effective August 1, 2011. The law requires that an anemometer tower “fifty feet in height above the ground or higher…located outside the zoning jurisdiction of a city, and the appearance of which is not otherwise regulated by state or federal law must be marked, painted, flagged, or otherwise constructed to be recognizable in clear air during daylight hours.” The towers must meet the following requirements:
On Monday, March 21, 2011, Governor Dayton signed into law H.F. 79, which conforms Minnesota’s individual income and corporate franchise taxes to most federal tax law changes enacted between March 18, 2010, and December 31, 2010, but only for the 2010 tax year. Among other changes, the tax bill contains the following benefits-related provisions:
Since 1970, the Bank Secrecy Act has required U.S. persons who have in aggregate more than $10,000 in foreign financial accounts to report certain information about those accounts to the Department of the Treasury using Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR). The FBAR is an informational return that is filed separately from a tax return. It must be received by the IRS by June 30. Failure to file an FBAR can result in significant civil and criminal penalties. Although the reporting requirements have existed more than 40 years, many people with foreign accounts have never heard of the FBAR.