Adjustment of Civil Penalties for Inflation
| Published date | 28 December 2018 |
| Citation | 83 FR 67073 |
| Record Number | 2018-28177 |
| Section | Rules and Regulations |
| Court | Pension Benefit Guaranty Corporation |
Federal Register, Volume 83 Issue 248 (Friday, December 28, 2018)
[Federal Register Volume 83, Number 248 (Friday, December 28, 2018)]
[Rules and Regulations]
[Pages 67073-67074]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-28177]
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PENSION BENEFIT GUARANTY CORPORATION
29 CFR Parts 4071 and 4302
RIN 1212-AB45
Adjustment of Civil Penalties for Inflation
AGENCY: Pension Benefit Guaranty Corporation.
ACTION: Final rule.
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SUMMARY: The Pension Benefit Guaranty Corporation is required to amend
its regulations annually to adjust for inflation the maximum civil
penalty for failure to provide certain notices or other material
information and for failure to provide certain multiemployer plan
notices.
DATES: Effective date: This rule is effective on December 28, 2018.
Applicability date: The increases in the civil monetary penalties
under sections 4071 and 4302 of the Employee Retirement Income Security
Act provided for in this rule apply to such penalties assessed after
December 28, 2018.
FOR FURTHER INFORMATION CONTACT: Stephanie Cibinic, Deputy Assistant
General Counsel for Regulatory Affairs (cibinic.stephanie@pbgc.gov),
Office of the General Counsel, Pension Benefit Guaranty Corporation,
1200 K Street NW, Washington, DC 20005-4026; 202-326-4400 extension
6352. (TTY users may call the Federal relay service toll-free at 800-
877-8339 and ask to be connected to 202-326-4400 extension 6352.)
SUPPLEMENTARY INFORMATION:
Executive Summary
Purpose of the Regulatory Action
This rule is needed to carry out the requirements of the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and
Office of Management and Budget guidance M-19-04. The rule adjusts, as
required for 2019, the maximum civil penalties under 29 CFR part 4071
and 29 CFR part 4302 that the Pension Benefit Guaranty Corporation
(PBGC) may assess for failure to provide certain notices or other
material information and certain multiemployer plan notices.
PBGC's legal authority for this action comes from the Federal Civil
Penalties Inflation Adjustment Act of 1990 as amended by the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and
from sections 4002(b)(3), 4071, and 4302 of the Employee Retirement
Income Security Act of 1974 (ERISA).
Major Provisions of the Regulatory Action
This rule adjusts as required by law the maximum civil penalties
that PBGC may assess under sections 4071 and 4302 of ERISA. The new
maximum amounts are $2,194 for section 4071 penalties and $292 for
section 4302 penalties.
Background
PBGC administers title IV of ERISA. Title IV has two provisions
that authorize PBGC to assess civil monetary penalties.\1\ Section
4302, added to ERISA by the Multiemployer Pension Plan Amendments Act
of 1980, authorizes PBGC to assess a civil penalty of up to $100 a day
for failure to provide a notice under subtitle E of title IV of ERISA
(dealing with multiemployer plans). Section 4071, added to ERISA by the
Omnibus Budget Reconciliation Act of 1987, authorizes PBGC to assess a
civil penalty of up to $1,000 a day for failure to provide a notice or
other material information under subtitles A, B, and C of title IV and
sections 303(k)(4) and 306(g)(4) of title I of ERISA.
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\1\ Under the Federal Civil Penalties Inflation Adjustment Act
of 1990, a penalty is a civil monetary penalty if (among other
things) it is for a specific monetary amount or has a maximum amount
specified by Federal law. Title IV also provides (in section 4007)
for penalties for late payment of premiums, but those penalties are
neither in a specified amount nor subject to a specified maximum
amount.
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Adjustment of Civil Penalties
On November 2, 2015, the President signed into law the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015,\2\
which requires agencies to adjust civil monetary penalties for
inflation and to publish the adjustments in the Federal Register. An
initial adjustment was required to be made by interim final rule
published by July 1, 2016, and effective by August 1, 2016. Subsequent
adjustments must be published by January 15 each year after 2016.
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\2\ Sec. 701, Public Law 114-74, 129 Stat. 599-601 (Bipartisan
Budget Act of 2015).
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On December 14, 2018, the Office of Management and Budget issued
[[Page 67074]]
memorandum M-19-04 on implementation of the 2019 annual inflation
adjustment pursuant to the 2015 act.\3\ The memorandum provides
agencies with the cost-of-living adjustment multiplier for 2019, which
is based on the Consumer Price Index (CPI-U) for the month of October
2018, not seasonally adjusted. The multiplier for 2019 is 1.02522. The
adjusted maximum amounts are $2,194 for section 4071 penalties and $292
for section 4302 penalties.
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\3\ See M-19-04, Implementation of Penalty Inflation Adjustments
for 2019, Pursuant to the Federal Civil Penalties Inflation
Adjustment Act Improvements Act of 2015, https://www.whitehouse.gov/omb/information-for-agencies/memoranda/.
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Compliance With Regulatory Requirements
The Office of Management and Budget has determined that this rule
is not a ``significant regulatory action'' under Executive Order 12866
and therefore not subject to its review. As this is not a significant
regulatory action under E.O. 12866, it is not considered an E.O. 13771
regulatory action.
The Office of Management and Budget also has determined that notice
and public comment on this final rule are unnecessary because the
adjustment of civil penalties implemented in the rule is required by
law. See 5 U.S.C. 553(b).
Because no general notice of proposed rulemaking is required for
this rule, the Regulatory Flexibility Act of 1980 does not apply. See 5
U.S.C. 601(2).
List of Subjects
29 CFR Part 4071
Penalties.
29 CFR Part 4302
Penalties.
In consideration of the foregoing, PBGC amends 29 CFR parts 4071
and 4302 as follows:
PART 4071--PENALTIES FOR FAILURE TO PROVIDE CERTAIN NOTICES OR
OTHER MATERIAL INFORMATION
0
1. The authority citation for part 4071 continues to read as follows:
Authority: 28 U.S.C. 2461 note, as amended by sec. 701, Pub. L.
114-74, 129 Stat. 599-601; 29 U.S.C. 1302(b)(3), 1371.
Sec. 4071.3 [Amended]
0
2. In Sec. 4071.3, the figures ``$2,140'' are removed and the figures
``$2,194'' are added in their place.
PART 4302--PENALTIES FOR FAILURE TO PROVIDE CERTAIN MULTIEMPLOYER
PLAN NOTICES
0
3. The authority citation for part 4302 continues to read as follows:
Authority: 28 U.S.C. 2461 note, as amended by sec. 701, Pub. L.
114-74, 129 Stat. 599-601; 29 U.S.C. 1302(b)(3), 1452.
Sec. 4302.3 [Amended]
0
4. In Sec. 4302.3, the figures ``$285'' are removed and the figures
``$292'' are added in their place.
Issued in Washington, DC.
William Reeder,
Director, Pension Benefit Guaranty Corporation.
[FR Doc. 2018-28177 Filed 12-27-18; 8:45 am]
BILLING CODE 7709-02-P
