Multiemployer plans: Interest rates and assumptions,

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Federal Register: December 15, 1998 (Volume 63, Number 240)NoticesPage 69123From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DOCID:fr15de98-95

PENSION BENEFIT GUARANTY CORPORATION

Interest Assumption for Determining Variable-Rate Premium; Interest Assumptions for Multiemployer Plan Valuations Following Mass Withdrawal

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Notice of interest rates and assumptions.

SUMMARY: This notice informs the public of the interest rates and assumptions to be used under certain Pension Benefit Guaranty Corporation regulations. These rates and assumptions are published elsewhere (or are derivable from rates published elsewhere), but are collected and published in this notice for the convenience of the public. Interest rates are also published on the PBGC's web site (http://www.pbgc.gov).

DATES: The interest rate for determining the variable-rate premium under part 4006 applies to premium payment years beginning in December 1998. The interest assumptions for performing multiemployer plan valuations following mass withdrawal under part 4281 apply to valuation dates occurring in January 1999.

FOR FURTHER INFORMATION CONTACT: Harold J. Ashner, Assistant General Counsel, Office of the General Counsel, Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, DC 20005, 202-326-4024. (For TTY/TDD users, call the Federal relay service toll-free at 1-800- 877-8339 and ask to be connected to 202-326-4024.)

SUPPLEMENTARY INFORMATION:

Variable-Rate Premiums

Section 4006(a)(3)(E)(iii)(II) of the Employee Retirement Income Security Act of 1974 (ERISA) and Sec. 4006.4(b)(1) of the PBGC's regulation on Premium Rates (29 CFR part 4006) prescribe use of an assumed interest rate in determining a single-employer plan's variable- rate premium. The rate is the ``applicable percentage'' (currently 85 percent) of the annual yield on 30-year Treasury securities for the month preceding the beginning of the plan year for which premiums are being paid (the ``premium payment year''). The yield figure is reported in Federal Reserve Statistical Releases G.13 and H.15.

The assumed interest rate to be used in determining variable-rate premiums for premium payment years beginning in December 1998 is 4.46 percent (i.e., 85 percent of the 5.25 percent yield figure for November 1998).

The following table lists the assumed interest rates to be used in determining variable-rate premiums for premium payment years beginning between January and December 1998.

The assumed For premium payment years beginning in:

interest rate is:

January 1998................................................. 5.09 February 1998................................................ 4.94 March 1998................................................... 5.01 April 1998................................................... 5.06 May 1998..................................................... 5.03 June 1998.................................................... 5.04 July 1998.................................................... 4.85 August 1998.................................................. 4.83 September 1998............................................... 4.71 October 1998................................................. 4.42 November 1998................................................ 4.26 December 1998................................................ 4.46

Multiemployer Plan Valuations Following Mass Withdrawal

The PBGC's regulation on Duties of Plan Sponsor Following Mass Withdrawal (29 CFR part 4281) prescribes the use of interest assumptions under the PBGC's regulation on Allocation of Assets in Single-employer Plans (29 CFR part 4044). The interest assumptions applicable to valuation dates in January 1999 under part 4044 are contained in an amendment to part 4044 published elsewhere in today's Federal Register. Tables showing the assumptions applicable to prior periods are codified in appendix B to 29 CFR part 4044.

Issued in Washington, DC, on this 9th day of December 1998. John Seal, Acting Executive Director, Pension Benefit Guaranty Corporation.

FR Doc. 98-33138Filed12-14-98; 8:45 amBILLING CODE 7708-01-P

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