80 FR 34052 - Allocation of Assets in Single-Employer Plans; Benefits Payable in Terminated Single-Employer Plans; Interest Assumptions for Valuing and Paying Benefits
PENSION BENEFIT GUARANTY CORPORATION Federal Register Volume 80, Issue 114 (June 15, 2015)
Federal Register Volume 80, Issue 114 (June 15, 2015)
| Page Range | 34052-34053 | |
| FR Document | 2015-14592 |
[Federal Register Volume 80, Number 114 (Monday, June 15, 2015)] [Rules and Regulations] [Pages 34052-34053] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-14592] ======================================================================= ----------------------------------------------------------------------- PENSION BENEFIT GUARANTY CORPORATION 29 CFR Parts 4022 and 4044 Allocation of Assets in Single-Employer Plans; Benefits Payable in Terminated Single-Employer Plans; Interest Assumptions for Valuing and Paying Benefits AGENCY: Pension Benefit Guaranty Corporation. ACTION: Final rule. ----------------------------------------------------------------------- SUMMARY: This final rule amends the Pension Benefit Guaranty Corporation's regulations on Benefits Payable in Terminated Single- Employer Plans and Allocation of Assets in Single-Employer Plans to prescribe interest assumptions under the benefit payments regulation for valuation dates in July 2015 and interest assumptions under the asset allocation regulation for valuation dates in the third quarter of 2015. The interest assumptions are used for valuing and paying benefits under terminating single-employer plans covered by the pension insurance system administered by PBGC. DATES: Effective July 1, 2015. FOR FURTHER INFORMATION CONTACT: Catherine B. Klion ([email protected]), Assistant General Counsel for Regulatory Affairs, 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 regulations on Allocation of Assets in Single-Employer Plans (29 CFR part 4044) and Benefits Payable in Terminated Single-Employer Plans (29 CFR part 4022) prescribe actuarial assumptions--including interest assumptions--for valuing and paying plan benefits under terminating single-employer plans covered by title IV of the Employee Retirement Income Security Act of 1974. The interest assumptions in the regulations are also published on PBGC's Web site (http://www.pbgc.gov). The interest assumptions in Appendix B to Part 4044 are used to value benefits for allocation purposes under ERISA section 4044. 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 asset allocation regulation are updated quarterly; assumptions under the benefit payments regulation are updated monthly. This final rule updates the benefit payments interest assumptions for July 2015 and updates the asset allocation interest assumptions for the third quarter (July through September) of 2015. The third quarter 2015 interest assumptions under the allocation regulation will be 2.32 percent for the first 20 years following the valuation date and 2.37 percent thereafter. In comparison with the interest assumptions in effect for the second quarter of 2015, these interest assumptions represent no change in the select period (the period during which the select rate (the initial rate) applies), a decrease of 0.39 percent in the select rate, and a decrease of 0.41 percent in the ultimate rate (the final rate). The July 2015 interest assumptions under the benefit payments regulation will be 1.25 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 June 2015, 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 valuation and payment of benefits under plans with valuation dates during July 2015, 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 34053]] 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 29 CFR Part 4022 Employee benefit plans, Pension insurance, Pensions, Reporting and recordkeeping requirements. 29 CFR Part 4044 Employee benefit plans, Pension insurance, Pensions. In consideration of the foregoing, 29 CFR parts 4022 and 4044 are 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 261 is added to the table to read as follows: 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) i1 i2 i3 n1 n2 -------------------------------------------------------------------------------------------------------------------------------------------------------- * * * * * * * 261..................................................... 7-1-15 8-1-15 1.25 4.00 4.00 4.00 7 8 -------------------------------------------------------------------------------------------------------------------------------------------------------- 0 3. In appendix C to part 4022, Rate Set 261 is added to the table to read as follows: 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) i1 i2 i3 n1 n2 -------------------------------------------------------------------------------------------------------------------------------------------------------- * * * * * * * 261..................................................... 7-1-15 8-1-15 1.25 4.00 4.00 4.00 7 8 -------------------------------------------------------------------------------------------------------------------------------------------------------- PART 4044--ALLOCATION OF ASSETS IN SINGLE-EMPLOYER PLANS 0 4. The authority citation for part 4044 continues to read as follows: Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362. 0 5. In appendix B to part 4044, a new entry for July-September 2015 is added to the table to read as follows: Appendix B to Part 4044--Interest Rates Used To Value Benefits * * * * * -------------------------------------------------------------------------------------------------------------------------------------------------------- The values of it are: For valuation dates occurring in the month-- ----------------------------------------------------------------------------------------------------- it for t = it for t = it for t = -------------------------------------------------------------------------------------------------------------------------------------------------------- * * * * * * * July-September 2015............................... 0.0232 1-20 0.0237 >20 N/A N/A -------------------------------------------------------------------------------------------------------------------------------------------------------- Issued in Washington, DC, on this 8th day of June 2015. Judith Starr, General Counsel, Pension Benefit Guaranty Corporation. [FR Doc. 2015-14592 Filed 6-12-15; 8:45 am] BILLING CODE 7709-02-P
![34052 Federal Register / Vol. 80, No. 114 / Monday, June 15, 2015 / Rules and Regulations
advance if potential impeachment Dated: June 4, 2015. assumptions in Appendix B to Part 4022
records collected and maintained in Erika Brown Lee, to determine whether a benefit is
order to sufficiently meet the Chief Privacy and Civil Liberties Officer, payable as a lump sum and to determine
Department’s Giglio requirements and United States Department of Justice. the amount to pay. Appendix C to Part
obligations are all relevant and [FR Doc. 2015–14641 Filed 6–12–15; 8:45 am] 4022 contains interest assumptions for
necessary. In order to ensure that the BILLING CODE 4410–FB–P private-sector pension practitioners to
Department’s prosecutors and refer to if they wish to use lump-sum
investigative agencies receive sufficient interest rates determined using PBGC’s
information to meet their obligations PENSION BENEFIT GUARANTY historical methodology. Currently, the
under Giglio, it is appropriate to CORPORATION rates in Appendices B and C of the
maintain potential impeachment benefit payment regulation are the same.
29 CFR Parts 4022 and 4044 The interest assumptions are intended
information in accordance with
Department policy as such records to reflect current conditions in the
Allocation of Assets in Single- financial and annuity markets.
could later be relevant and necessary in Employer Plans; Benefits Payable in Assumptions under the asset allocation
a different case in which the same Terminated Single-Employer Plans; regulation are updated quarterly;
witness or affiant subsequently testifies. Interest Assumptions for Valuing and assumptions under the benefit payments
(5) From subsection (e)(2) because Paying Benefits regulation are updated monthly. This
collecting information directly from the AGENCY: Pension Benefit Guaranty final rule updates the benefit payments
subject individual could serve notice Corporation. interest assumptions for July 2015 and
that the individual is the subject of ACTION: Final rule. updates the asset allocation interest
investigation and because of the nature assumptions for the third quarter (July
of the records in this system, which are SUMMARY: This final rule amends the through September) of 2015.
used to impeach or demonstrate bias of Pension Benefit Guaranty Corporation’s The third quarter 2015 interest
a witness, requires that the information regulations on Benefits Payable in assumptions under the allocation
be collected from others. Terminated Single-Employer Plans and regulation will be 2.32 percent for the
Allocation of Assets in Single-Employer first 20 years following the valuation
(6) From subsection (e)(3) because Plans to prescribe interest assumptions date and 2.37 percent thereafter. In
federal law enforcement officers receive under the benefit payments regulation comparison with the interest
notice from their supervisors and for valuation dates in July 2015 and assumptions in effect for the second
prosecuting attorneys that impeachment interest assumptions under the asset quarter of 2015, these interest
information may be used at trial. Law allocation regulation for valuation dates assumptions represent no change in the
enforcement officers are also given in the third quarter of 2015. The interest select period (the period during which
notice by the Giglio decision itself. assumptions are used for valuing and the select rate (the initial rate) applies),
(7) From subsections (e)(4)(G), (H), paying benefits under terminating a decrease of 0.39 percent in the select
and (I) because this system of records is single-employer plans covered by the rate, and a decrease of 0.41 percent in
exempt from the access and amendment pension insurance system administered the ultimate rate (the final rate).
provisions of subsection (d). by PBGC. The July 2015 interest assumptions
DATES: Effective July 1, 2015. under the benefit payments regulation
(8) From subsection (e)(5) because it
FOR FURTHER INFORMATION CONTACT: will be 1.25 percent for the period
may not be possible to determine in
Catherine B. Klion (Klion.Catherine@ during which a benefit is in pay status
advance if all potential impeachment and 4.00 percent during any years
PBGC.gov), Assistant General Counsel
records collected and maintained in preceding the benefit’s placement in pay
for Regulatory Affairs, Pension Benefit
order to sufficiently meet the Guaranty Corporation, 1200 K Street status. In comparison with the interest
Department’s Giglio requirements and NW., Washington, DC 20005, 202–326– assumptions in effect for June 2015,
obligations are all accurate, relevant, 4024. (TTY/TDD users may call the these interest assumptions represent an
timely, and complete at the time of Federal relay service toll free at 1–800– increase of 0.50 percent in the
collection. Although the Department has 877–8339 and ask to be connected to immediate annuity rate and are
policies in place to verify the records, 202–326–4024.) otherwise unchanged.
the records may be originated from SUPPLEMENTARY INFORMATION: PBGC’s PBGC has determined that notice and
another agency, third party, or open regulations on Allocation of Assets in public comment on this amendment are
source media and it may be impossible Single-Employer Plans (29 CFR part impracticable and contrary to the public
to ensure the accuracy, relevance, 4044) and Benefits Payable in interest. This finding is based on the
timeliness, and completeness of Terminated Single-Employer Plans (29 need to determine and issue new
potential impeachment information CFR part 4022) prescribe actuarial interest assumptions promptly so that
maintained prior to and during the assumptions—including interest the assumptions can reflect current
process of being verified. assumptions—for valuing and paying market conditions as accurately as
(9) From subsection (e)(8) because the plan benefits under terminating single- possible.
employer plans covered by title IV of Because of the need to provide
nature of the Giglio discovery process
the Employee Retirement Income immediate guidance for the valuation
renders notice of compliance with the
and payment of benefits under plans
wreier-aviles on DSK5TPTVN1PROD with RULES
compulsory discovery process Security Act of 1974. The interest
assumptions in the regulations are also with valuation dates during July 2015,
impractical. PBGC finds that good cause exists for
published on PBGC’s Web site (http://
(10) From subsections (f) and (g) www.pbgc.gov). making the assumptions set forth in this
because these subsections are The interest assumptions in Appendix amendment effective less than 30 days
inapplicable to the extent that the B to Part 4044 are used to value benefits after publication.
system is exempt from other specific for allocation purposes under ERISA PBGC has determined that this action
subsections of the Privacy Act. section 4044. PBGC uses the interest is not a ‘‘significant regulatory action’’
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![Federal Register / Vol. 80, No. 114 / Monday, June 15, 2015 / Rules and Regulations 34053
under the criteria set forth in Executive 29 CFR Part 4044 Authority: 29 U.S.C. 1302, 1322, 1322b,
Order 12866. 1341(c)(3)(D), and 1344.
Employee benefit plans, Pension
Because no general notice of proposed
insurance, Pensions. ■ 2. In appendix B to part 4022, Rate Set
rulemaking is required for this
amendment, the Regulatory Flexibility In consideration of the foregoing, 29 261 is added to the table to read as
Act of 1980 does not apply. See 5 U.S.C. CFR parts 4022 and 4044 are amended follows:
601(2). as follows:
Appendix B to Part 4022—Lump Sum
List of Subjects PART 4022—BENEFITS PAYABLE IN Interest Rates for PBGC Payments
TERMINATED SINGLE-EMPLOYER
29 CFR Part 4022 * * * * *
PLANS
Employee benefit plans, Pension
insurance, Pensions, Reporting and ■ 1. The authority citation for part 4022
recordkeeping requirements. continues to read as follows:
For plans with a valuation date Deferred annuities
Immediate (percent)
Rate set annuity rate
On or after Before (percent) i1 i2 i3 n1 n2
* * * * * * *
261 .......................................................................... 7–1–15 8–1–15 1.25 4.00 4.00 4.00 7 8
■ 3. In appendix C to part 4022, Rate Set Appendix C to Part 4022—Lump Sum
261 is added to the table to read as Interest Rates for Private-Sector
follows: Payments
* * * * *
For plans with a valuation date Deferred annuities
Immediate (percent)
Rate set annuity rate
On or after Before (percent) i1 i2 i3 n1 n2
* * * * * * *
261 .......................................................................... 7–1–15 8–1–15 1.25 4.00 4.00 4.00 7 8
PART 4044—ALLOCATION OF Authority: 29 U.S.C. 1301(a), 1302(b)(3), Appendix B to Part 4044—Interest
ASSETS IN SINGLE–EMPLOYER 1341, 1344, 1362. Rates Used To Value Benefits
PLANS * * * * *
■ 5. In appendix B to part 4044, a new
■ 4. The authority citation for part 4044 entry for July–September 2015 is added
continues to read as follows: to the table to read as follows:
The values of it are:
For valuation dates occurring in the
month— it for t = it for t = it for t =
* * * * * * *
July–September 2015 ............................... 0.0232 1–20 0.0237 >20 N/A N/A
Issued in Washington, DC, on this 8th day DEPARTMENT OF THE TREASURY Control (OFAC) is amending the
of June 2015. Terrorism List Governments Sanctions
Judith Starr, Office of Foreign Assets Control Regulations to replace the list of
General Counsel, Pension Benefit Guaranty countries designated as supporting
Corporation. 31 CFR Parts 515 and 596 international terrorism with information
[FR Doc. 2015–14592 Filed 6–12–15; 8:45 am] on the availability of state sponsor of
Cuban Assets Control Regulations;
BILLING CODE 7709–02–P terrorism determination and rescission
Terrorism List Governments Sanctions
wreier-aviles on DSK5TPTVN1PROD with RULES
Regulations decisions in the Federal Register and
the availability of a current list of state
AGENCY: Office of Foreign Assets sponsors of terrorism maintained on the
Control, Treasury. Web site of the Department of State. A
ACTION: Final rule. conforming amendment is made to the
Cuban Assets Control Regulations.
SUMMARY: The Department of the
Treasury’s Office of Foreign Assets DATES: Effective: June 15, 2015.
VerDate Sep<11>2014 15:17 Jun 12, 2015 Jkt 235001 PO 00000 Frm 00031 Fmt 4700 Sfmt 4700 E:\FR\FM\15JNR1.SGM 15JNR1](https://thefederalregister.org/doc/80_FR_34166/page/2.svg)
Document Created: 2015-12-15 15:13:41
Document Modified: 2015-12-15 15:13:41
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Rules and Regulations | |
| Action | Final rule. | |
| Dates | Effective July 1, 2015. | |
| Contact | Catherine B. Klion ([email protected]), Assistant General Counsel for Regulatory Affairs, 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.) | |
| FR Citation | 80 FR 34052 | |
| CFR Citation | 29
CFR
4022 29 CFR 4044 | |
| CFR Associated | Employee Benefit Plans; Pension Insurance; Pensions and Reporting and Recordkeeping Requirements |
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