Benefits Payable in Terminated Single-Employer Plans:
Federal Register: November 15, 2010 (Volume 75, Number 219)
Rules and Regulations
Page 69588-69589
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
DOCID:fr15no10-6
PENSION BENEFIT GUARANTY CORPORATION 29 CFR Part 4022
Benefits Payable in Terminated Single-Employer Plans; Interest
Assumptions for Paying Benefits
AGENCY: Pension Benefit Guaranty Corporation.
ACTION: Final rule.
SUMMARY: This final rule amends Pension Benefit Guaranty Corporation's regulation on Benefits Payable in Terminated Single-Employer Plans to prescribe interest assumptions under the regulation for valuation dates in December 2010. Interest assumptions are also published on PBGC's Web site (http://www.pbgc.gov).
DATES: Effective December 1, 2010.
FOR FURTHER INFORMATION CONTACT: Catherine B. Klion, Manager,
Regulatory and Policy Division, Legislative and Regulatory Department,
Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington,
DC 20005, 202-326-4024. (TTY/TDD users may call the Federal relay service toll-free at 1-800-877-8339 and ask to be connected to 202-326- 4024.)
SUPPLEMENTARY INFORMATION: PBGC's regulation on Benefits Payable in
Terminated Single-Employer Plans (29 CFR part 4022) prescribes actuarial assumptions--including interest assumptions--for paying plan benefits under terminating single-employer plans covered by title IV of the Employee Retirement Income Security Act of 1974.
PBGC uses the interest assumptions in Appendix B to Part 4022 to determine whether a benefit is payable as a lump sum and to determine the amount to pay. Appendix C to Part 4022 contains interest assumptions for private-sector pension practitioners to refer to if they wish to use lump-sum interest rates determined using PBGC's historical methodology. Currently, the rates in Appendices B and C of the benefit payment regulation are the same.
The interest assumptions are intended to reflect current conditions in the financial and annuity markets. Assumptions under the benefit payments regulation are updated monthly. This final rule updates the benefit payments interest assumptions for December 2010.\1\
\1\ Appendix B to PBGC's regulation on Allocation of Assets in
Single-Employer Plans (29 CFR Part 4044) prescribes interest assumptions for valuing benefits under terminating covered single- employer plans for purposes of allocation of assets under ERISA section 4044. Those assumptions are updated quarterly.
The December 2010 interest assumptions under the benefit payments regulation will be 2.25 percent for the period during which a benefit is in pay status and 4.00 percent during any years preceding the benefit's placement in pay status. In comparison with the interest assumptions in effect for November 2010, these interest assumptions represent an increase of 0.50 percent in the immediate annuity rate and are otherwise unchanged.
PBGC has determined that notice and public comment on this amendment are impracticable and contrary to the public interest. This finding is based on the need to determine and issue new interest assumptions promptly so that the assumptions can reflect current market conditions as accurately as possible.
Because of the need to provide immediate guidance for the payment of benefits under plans with valuation dates during December 2010, PBGC finds that good cause exists for making the assumptions set forth in this amendment effective less than 30 days after publication.
PBGC has determined that this action is not a ``significant regulatory action''
Page 69589
under the criteria set forth in Executive Order 12866.
Because no general notice of proposed rulemaking is required for this amendment, the Regulatory Flexibility Act of 1980 does not apply.
See 5 U.S.C. 601(2).
List of Subjects in 29 CFR Part 4022
Employee benefit plans, Pension insurance, Pensions, Reporting and recordkeeping requirements. 0
In consideration of the foregoing, 29 CFR part 4022 is amended as follows:
PART 4022--BENEFITS PAYABLE IN TERMINATED SINGLE-EMPLOYER PLANS 0 1. The authority citation for part 4022 continues to read as follows:
Authority: 29 U.S.C. 1302, 1322, 1322b, 1341(c)(3)(D), and 1344. 0 2. In appendix B to part 4022, Rate Set 206, as set forth below, is added to the table.
Appendix B to Part 4022--Lump Sum Interest Rates For PBGC Payments
* * * * *
For plans with a valuation date
Immediate
Deferred annuities (percent)
Rate set
---------------------------------- annuity rate ------------------------------------------------------------------------------------
On or after
Before
(percent)
i 1
i 2
i 3
n 1
n 2
* * * * * * * 206
12-1-10
1-1-11
2.25
4.00
4.00
4.00
7
8
0 3. In appendix C to part 4022, Rate Set 206, as set forth below, is added to the table.
Appendix C to Part 4022--Lump Sum Interest Rates For Private-Sector
Payments
* * * * *
For plans with a valuation date
Immediate
Deferred annuities (percent)
Rate set
---------------------------------- annuity rate ------------------------------------------------------------------------------------
On or after
Before
(percent)
i 1
i 2
i 3
n 1
n 2
* * * * * * * 206
12-1-10
1-1-11
2.25
4.00
4.00
4.00
7
8
Issued in Washington, DC, on November 8, 2010.
Vincent K. Snowbarger,
Deputy Director for Operations, Pension Benefit Guaranty Corporation.
FR Doc. 2010-28570 Filed 11-12-10; 8:45 am
BILLING CODE 7709-01-P
