80 FR 8712 - Multiemployer Pension Reform Act of 2014; Partitions of Eligible Multiemployer Plans and Facilitated Mergers

PENSION BENEFIT GUARANTY CORPORATION

Federal Register Volume 80, Issue 32 (February 18, 2015)

Page Range		8712-8715
FR Document		2015-03434
This document is a request for information (RFI) to inform future PBGC guidance under sections 4231 and 4233 of ERISA. PBGC is seeking comments from all interested stakeholders, including multiemployer plan participants and beneficiaries, organizations serving or representing such individuals, multiemployer plan sponsors and professional advisors, contributing employers, unions, and other interested parties.
Federal Register, Volume 80 Issue 32 (Wednesday, February 18, 2015)
[Federal Register Volume 80, Number 32 (Wednesday, February 18, 2015)]
[Notices]
[Pages 8712-8715]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-03434]


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PENSION BENEFIT GUARANTY CORPORATION


Multiemployer Pension Reform Act of 2014; Partitions of Eligible 
Multiemployer Plans and Facilitated Mergers

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Request for Information.

-----------------------------------------------------------------------

SUMMARY: This document is a request for information (RFI) to inform 
future PBGC guidance under sections 4231 and 4233 of ERISA. PBGC is 
seeking comments from all interested stakeholders, including 
multiemployer plan participants and beneficiaries, organizations 
serving or representing such individuals, multiemployer plan sponsors 
and professional advisors, contributing employers, unions, and other 
interested parties.

DATES: Comments must be received on or before April 6, 2015.

ADDRESSES: Comments may be submitted by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the Web site instructions for submitting comments.
     Email: reg.comments@pbgc.gov.
     Fax: 202-326-4224.
     Mail or Hand Delivery: Regulatory Affairs Group, Office of 
the General Counsel, Pension Benefit Guaranty Corporation, 1200 K 
Street NW., Washington, DC 20005-4026.
    All materials submitted will be shared with the Department of the 
Treasury and the Department of Labor. Comments received, including 
personal

[[Page 8713]]

information provided, will be posted to www.pbgc.gov. Copies of 
comments may also be obtained by writing to Disclosure Division, Office 
of the General Counsel, Pension Benefit Guaranty Corporation, 1200 K 
Street, NW., Washington, DC 20005-4026 or calling 202-326-4040 during 
normal business hours. (TTY and TDD users may call the Federal relay 
service toll-free at 1-800-877-8339 and ask to be connected to 202-326-
4040.)

FOR FURTHER INFORMATION CONTACT: Joseph J. Shelton 
(shelton.joseph@pbgc.gov), Office of the General Counsel, at 202-326-
4000, ext. 6559, or Constance Markakis (markakis.constance@pbgc.gov), 
Office of Negotiations and Restructuring, at 202-326-4000, ext. 6779; 
(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: 

Background

    The Pension Benefit Guaranty Corporation (PBGC) is a Federal 
corporation created under the Employee Retirement Income Security Act 
of 1974 (ERISA) to guarantee the payment of pension benefits earned by 
more than 41 million American workers and retirees in nearly 24,000 
private-sector defined benefit pension plans. PBGC administers two 
insurance programs--one for single-employer defined benefit pension 
plans and a second for multiemployer defined benefit pension plans.
    The multiemployer program protects benefits of approximately 10 
million workers and retirees in approximately 1,400 plans. A 
multiemployer plan is a collectively bargained pension arrangement 
involving two or more unrelated employers, usually in a common 
industry, such as construction or trucking, where workers may move from 
employer to employer on a regular basis.
    Under PBGC's multiemployer program, when a plan becomes insolvent, 
PBGC provides financial assistance directly to the insolvent plan 
sufficient to pay guaranteed benefits to participants and 
beneficiaries, and the reasonable and necessary administrative expenses 
of the insolvent plan.
    The focus of this RFI is on two new statutory provisions regarding 
multiemployer partitions and mergers that apply only to multiemployer 
pension plans. The provisions were enacted on December 16, 2014, as 
part of the Multiemployer Pension Reform Act of 2014, Division O of the 
Consolidated and Further Continuing Appropriations Act, 2015, Public 
Law 113-235 (MPRA). The first is section 122 of MPRA, which replaced 
the multiemployer partition rules under section 4233 of ERISA with new 
rules. The second is section 121 of MPRA, which added a new provision 
to the multiemployer merger rules under section 4231 of ERISA. Below is 
a summary of those rules.

Partitions of Eligible Multiemployer Plans Under MPRA

    Before MPRA, PBGC could partition a multiemployer plan likely to 
become insolvent on its own accord or upon application by a plan 
sponsor. In either case, however, partition was only available in 
certain limited circumstances involving employer bankruptcies, and the 
liabilities transferred were those directly attributable to service 
with bankrupt employers. Under the partition order, those liabilities 
and an equitable share of assets were transferred to a new plan created 
by the partition (which was both a terminated plan and a successor plan 
under Title IV of ERISA), at which point the original plan was no 
longer responsible for the transferred liabilities.\1\ Section 122 of 
MPRA replaced this framework with new rules under section 4233 of 
ERISA.
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    \1\ Upon plan insolvency, PBGC provided the terminated plan with 
financial assistance to cover the cost of PBGC-guaranteed benefits 
and reasonable and necessary administrative expenses.
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    Section 4233(a)(1), as amended by MPRA, provides that upon the 
application by the plan sponsor of an ``eligible multiemployer plan,'' 
PBGC may order a partition. The statute requires PBGC to make a 
determination on an application for partition not later than 270 days 
after the date the application was filed (or, if later, the date the 
application was completed) in accordance with regulations to be 
promulgated by PBGC. Under section 4233(a)(2), the plan sponsor must 
provide notice of the application for partition to participants and 
beneficiaries (in the form and manner prescribed by regulation) not 
later than 30 days after submitting an application. Because regulations 
are required to implement section 4233 of ERISA, including the 
procedures for the plan sponsor to submit an application for partition, 
PBGC has determined that a plan sponsor may submit an application for 
partition only on or after a date to be specified in regulations.
    Section 4233(b) prescribes five requirements that must be satisfied 
for PBGC to determine that a plan is an ``eligible multiemployer plan'' 
for purposes of section 4233 of ERISA:
    1. Section 4233(b)(1) provides that the plan must be in critical 
and declining status as defined in section 305 of ERISA (section 432 of 
the Internal Revenue Code (Code)).
    2. Under section 4233(b)(2), PBGC must determine, after 
consultation with the Participant and Plan Sponsor Advocate selected 
under section 4004, that the plan sponsor has taken (or is taking 
concurrently with an application for partition) all reasonable measures 
to avoid insolvency, including the maximum benefit suspensions under 
section 305(e)(9) of ERISA (section 432(e)(9) of the Code), if 
applicable.
    3. Under section 4233(b)(3), PBGC must reasonably expect that: (A) 
Partition will reduce PBGC's expected long-term loss with respect to 
the plan; and (B) partition is necessary for the plan to remain 
solvent.
    4. Under section 4233(b)(4), PBGC must certify to Congress that its 
ability to meet existing financial assistance obligations to other 
plans (including any liabilities associated with multiemployer plans 
that are insolvent or that are projected to become insolvent within 10 
years) will not be impaired by the partition.
    5. Section 4233(b)(5) requires that the cost of the partition to 
the PBGC arising from the partition be paid exclusively from PBGC's 
multiemployer fund.
    Upon approval by PBGC, section 4233(c) requires that the order of 
partition provide for a transfer of the minimum amount of liabilities 
necessary for the transferring plan (i.e., the original plan) to remain 
solvent. Under sections 4233(d)(1) and (2), the benefits in the plan 
created by the partition (the successor plan) are subject to the 
multiemployer benefit guarantee limits under section 4022A, and the 
plan sponsor and administrator of the original plan will also be the 
plan sponsor and administrator of the successor plan.
    Section 4233(d)(3) prescribes special withdrawal liability rules 
that apply for 10 years following the date of the partition order. In 
the event an employer withdraws from the plan that was partitioned (the 
original plan) within 10 years of the partition, withdrawal liability 
is computed with respect to the original plan and the plan that was 
created by the partition order (the successor plan). If the withdrawal 
occurs more than 10 years after the date of the partition order, 
withdrawal liability is computed only with respect to the original plan 
(and not with respect to the successor plan).

[[Page 8714]]

    Section 4233(e)(1) prescribes a continuing payment obligation that 
applies to the plan that was partitioned (the original plan), which 
requires it to pay a monthly benefit to each participant and 
beneficiary whose guaranteed benefit was transferred to the successor 
plan in the amount by which the benefit that would be paid under the 
original plan's terms (after taking into account any benefit 
suspensions under section 432(e)(9) of the Code and any plan amendments 
following the partition effective date) exceeds the PBGC-guaranteed 
benefit amount for that person.\2\
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    \2\ In addition, under section 4233(e)(2), in the event the 
original plan provides a benefit improvement after the effective 
date of the partition, the plan must pay to PBGC for each year 
during the 10-year period following the partition, an annual amount 
equal to the value of the increase in benefit payments for such year 
attributable to the benefit improvement (or, if less, the total 
benefit payments from the plan created by the partition for such 
year).
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    Section 4233(e)(3) sets forth a special premium rule that applies 
to the plan that was partitioned (the original plan), which requires it 
to pay the premiums for the participants whose benefits were 
transferred to the successor plan for each year during the 10-year 
period following the partition effective date. Finally, section 4233(f) 
provides notice requirements that apply to PBGC (not plan sponsors).

Facilitated Mergers and Financial Assistance Under MPRA

    Section 121 of MPRA amends, but does not replace, the existing 
multiemployer merger rules under section 4231. Specifically, it adds 
section 4231(e), which gives PBGC new statutory authority to facilitate 
the merger of two or more multiemployer plans if certain requirements 
are met. In contrast to the partition rule discussed above, a 
regulation is not required to implement section 4231(e). Nevertheless, 
PBGC is considering issuing guidance under that section so that 
applicants have advance notice of the expected showing they must make 
to demonstrate satisfaction of the new statutory criteria.
    Section 4231(e)(1) provides that when requested to do so by the 
plan sponsors, PBGC may take such actions as it deems appropriate to 
promote and facilitate the merger of two or more multiemployer plans if 
it determines, after consultation with the Participant and Plan Sponsor 
Advocate, that the following conditions are met:
     The transaction is in the interests of the participants 
and beneficiaries of at least one of the plans; and
     The transaction is not reasonably expected to be adverse 
to the overall interests of the participants and beneficiaries of any 
of the plans.
    For purposes of section 4231(e), ``facilitation'' may include 
training, technical assistance, mediation, communication with 
stakeholders, and support with related requests to other government 
agencies.
    Section 4231(e)(2) prescribes four requirements that must be 
satisfied for PBGC to provide financial assistance. Specifically, the 
statute provides that to facilitate a merger that PBGC determines is 
necessary to enable one or more of the plans involved to avoid or 
postpone insolvency, PBGC may provide financial assistance only if the 
following conditions are met:
     One or more of the multiemployer plans participating in 
the merger is in critical and declining status as defined in section 
305 of ERISA (section 432 of the Code);
     PBGC reasonably expects that: (i) Such financial 
assistance will reduce the corporation's expected long-term loss with 
respect to the plans involved; and (ii) such financial assistance is 
necessary for the merged plan to become or remain solvent;
     PBGC certifies that its ability to meet existing financial 
assistance obligations to other plans will not be impaired by such 
financial assistance; and
     PBGC financial assistance is paid exclusively from its 
multiemployer fund.

Request for Information

    PBGC is requesting information from stakeholders on a range of 
issues regarding the application process for partitions and facilitated 
mergers to better inform its future guidance under sections 121 and 122 
of MPRA.
    PBGC welcomes comments from all interested stakeholders, including 
participants and beneficiaries, organizations serving or representing 
such individuals, plan sponsors and professional advisors to 
multiemployer plans (including those in the actuarial and legal 
communities), contributing employers, unions, and other interested 
parties. In responding, please provide as much specificity and detail 
as possible, as well as any supporting documentation, including 
research and analyses, to ensure that we have the most helpful 
information for future guidance. Recognizing the linkage between MPRA's 
partition rules and the benefit suspension rules under section 
432(e)(9) of the Code, and the possibility that a plan sponsor may 
apply to PBGC for a partition (or facilitated merger) concurrently with 
an application for benefit suspension to the Department of the 
Treasury, comments relating to the interaction between these provisions 
are especially welcome. PBGC is not, however, seeking comments on 
section 432(e)(9) of the Code or any other provision of MPRA.
    The Department of the Treasury is issuing its own RFI seeking 
comments on certain matters that may be addressed in future guidance 
implementing section 432(e)(9) of the Code. PBGC and the Department of 
the Treasury intend to coordinate on the development of their processes 
as a result of these RFIs.

Issues Affecting Both Partitions and Facilitated Mergers

    1. Application Process: With respect to MPRA's changes to the rules 
governing mergers and partitions under sections 4231 and 4233 of ERISA, 
respectively, on which aspects of the application process would 
guidance be needed or helpful?
    2. PBGC Determinations: With respect to a PBGC determination under 
section 4233(b)(3) that a partition is necessary for a plan to remain 
solvent, or in the case of a facilitated merger involving financial 
assistance under section 4231(e)(2)(B) that financial assistance is 
necessary for a merged plan to become or remain solvent:
     What types of actuarial and plan administrative 
information and analysis are available to demonstrate that a partition 
or facilitated merger of the plan is necessary to remain solvent?
     What issues arise in demonstrating solvency over an 
extended duration?
    3. Small Plans: What special concerns do small multiemployer plans 
and their sponsors have regarding partition and facilitated mergers?
    4. Participants and Beneficiaries: What special concerns do 
participants and beneficiaries in multiemployer plans have regarding 
the process for considering applications for partition and facilitated 
mergers?

Issues Affecting Partitions Only

    5. Notice: With respect to the requirement under section 4233(a)(2) 
to provide notice to participants and beneficiaries not later than 30 
days after submitting the application for partition:
     How can PBGC reduce the burden of providing the notice 
under current law, while still providing important information to 
participants and beneficiaries? Should PBGC consider issuing a model 
notice in future guidance?

[[Page 8715]]

     What type(s) of information would participants and 
beneficiaries find most helpful?
     Given that the amount of liabilities required to be 
transferred in a partition may not be known at the time notice is 
issued, how should the notice reflect the requirements of section 
4233(e)(1), which ensure that affected participants and beneficiaries 
will receive no less than they would have received prior to the 
partition (taking into account benefit suspensions under section 
305(e)(9) and any plan amendments following the partition effective 
date)?
    6. PBGC Determination: For purposes of the requirement under 
section 4233(b) that PBGC determine, in consultation with the 
Participant and Plan Sponsor Advocate, that the plan sponsor has taken 
(or is taking concurrently with an application for partition), all 
reasonable measures to avoid insolvency, including the maximum benefit 
suspensions under section 432(e)(9) of the Code:
     What actuarial, economic, industry, or other information 
could a plan sponsor provide to make such a showing? What information 
or analysis might be difficult to provide?
     With respect to the consultation process under section 
4233(b)(2), how can the Participant and Plan Sponsor Advocate best 
assist PBGC in making its determination under this section?
    7. Concurrent Applications: What practical issues do plan sponsors 
and their professional advisors anticipate may arise in connection with 
a decision to submit combined applications for partition to PBGC under 
section 4233 of ERISA, and suspension of benefits to the Department of 
Treasury under section 432 of the Code? In responding to this question, 
consider the following:
     Timing: With respect to an application for partition, PBGC 
is required to make a determination not later than 270 days after the 
application date (or, if later, the date such application was 
completed). With respect to an application for suspension of benefits, 
the Treasury Secretary (in consultation with PBGC and the Secretary of 
Labor) is required to approve or deny an application within 225 days 
after submission.
     Effective Date: With respect to a concurrent application 
for partition and suspensions of benefits, the suspension of benefits 
may not take effect prior to the effective date of such partition.
     Solvency: Under section 4233(c), the amount to be 
transferred in a partition is the minimum amount of the plan's 
liabilities necessary for the plan to remain solvent. Section 
432(e)(9)(D)(iv) of the Code provides that any suspensions of benefits, 
in the aggregate (and, if applicable, considered in combination with a 
partition of the plan under section 4233 of ERISA), shall be reasonably 
estimated to achieve, but not materially exceed, the level that is 
necessary to avoid insolvency.
    8. Transferred Liabilities: Prior to MPRA, PBGC's partition order 
would provide for a transfer of no more than the non-forfeitable 
benefits directly attributable to service with the bankrupt employer 
and an equitable share of assets. In contrast, under section 4233(c), 
the partition order will provide for a transfer of the minimum amount 
of the plan's liabilities necessary for the plan to remain solvent. In 
addition, section 4233(e)(1) prescribes a continuing payment obligation 
that applies to the plan that was partitioned (the original plan).
     What types of actuarial and administrative information and 
data do multiemployer plans generally maintain that would allow PBGC to 
determine the minimum amount of the plan's liabilities necessary for 
the plan to remain solvent?
     What administrative or operational issues (e.g., 
recordkeeping, benefit processing, allocation of expenses) arise in 
connection with this change?
     Are there additional issues that arise with respect to the 
transfer of the plan's liabilities for particular groups of 
individuals?
    9. Post-Partition: With respect to issues that might arise post-
partition:
     What kinds of administrative or operational issues (e.g., 
recordkeeping, benefit processing, allocation of expenses, the original 
plan's ongoing payment obligations under section 4231(e)(1)) might 
arise post-partition for plan sponsors?
     What issues or challenges do plan sponsors and their 
professional advisors anticipate in connection with the special 
withdrawal liability rule under section 4233(d)(3), which applies for a 
10-year period following the partition effective date?
     What issues or challenges do plan sponsors and their 
professional advisors anticipate in connection with the special benefit 
improvement and premium rules under sections 4233(e)(2) and (3) of 
ERISA, which apply for a 10-year period following the partition 
effective date?
     Is there a need for additional post-partition oversight by 
PBGC to ensure compliance with MPRA's post-partition requirements, and 
if so, in what areas?

Issues Affecting Facilitated Mergers Only

    10. Technical Assistance: MPRA provides a non-exclusive list of the 
types of non-financial assistance that PBGC may provide in the context 
of a facilitated merger (e.g., training, technical assistance, 
mediation, communication with stakeholders, and support with related 
requests to other government agencies). For purposes of a facilitated 
merger, which of these types of assistance would plan sponsors and 
professional advisors find most helpful? Are there other examples of 
non-financial technical advice that would help facilitate multiemployer 
mergers?
    11. PBGC Determination: For purposes of the facilitated merger 
requirement under section 4231(e)(1) that PBGC determine, in 
consultation with the Participant and Plan Sponsor Advocate, that the 
transaction is in the interests of the participants and beneficiaries 
of at least one of the plans and is not reasonably expected to be 
adverse to the overall interests of the participants and beneficiaries 
of the plans:
     What actuarial, economic, industry, or other information 
could the plan sponsors of the plans involved in the proposed merger 
provide to make such a showing?
     With respect to the consultation process under section 
4231(e)(1), how can the Participant and Plan Sponsor Advocate best 
assist PBGC in making its determination under this section?
    12. Concurrent Applications: What procedural issues do plan 
sponsors and their professional advisors anticipate in connection with 
a decision to request assistance from PBGC for a facilitated merger 
under section 4231(e) of ERISA, concurrently with an application for 
suspension of benefits from the Department of Treasury under section 
432(e)(9) of the Code?
    Although PBGC is specifically requesting comments on the issues and 
questions discussed above, PBGC also invites comment on any other issue 
relating to the application process for partitions and facilitated 
mergers under sections 121 and 122 of MPRA.

    Issued in Washington, DC, this 13th day of February 2015.
Alice C. Maroni,
Acting Director, Pension Benefit Guaranty Corporation.
[FR Doc. 2015-03434 Filed 2-17-15; 8:45 am]
BILLING CODE 7709-02-P
8712 Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices

A request for a hearing or petition for prior to the filing deadline, the 110.81, should be submitted within
leave to intervene may be filed with the petitioner/requestor should contact the thirty days after publication of this
NRC electronically in accordance with Office of the Secretary by email at notice in the FR to Office of the
NRC’s E-Filing rule promulgated in HEARINGDOCKET@NRC.GOV, or by Secretary, U.S. Nuclear Regulatory
August 2007, 72 FR 49139; August 28, calling (301) 415–1677, to request a Commission, Washington, DC 20555,
2007. Information about filing digital ID certificate and allow for the Attention: Rulemaking and
electronically is available on the NRC’s creation of an electronic docket. Adjudications.
public Web site at http://www.nrc.gov/ In addition to a request for hearing or The information concerning this
site-help/e-submittals.html. To ensure petition for leave to intervene, written application for an export license
timely electronic filing, at least five days comments, in accordance with 10 CFR follows.

NRC EXPORT LICENSE APPLICATION
Description of material
Name of applicant, date of application, date Destination
received, application No., docket No. Material type Total quantity End use

DOE/NNSA—Y–12 National Security Com- High-Enriched Ura- 134.2 kg uranium-235 To fabricate fuel at Belgium.
plex, December 18, 2014, December 23, nium (93.20%). contained in 144.0 AREVA CERCA in
2014, XSNM3758, 11006188. kg uranium. France for ultimate
use in Belgian Nu-
clear Research
Center for BR–2 re-
actor fuel load.

For The U.S. Nuclear Regulatory Personnel Rules and Practices be held PENSION BENEFIT GUARANTY
Commission. with less than one week notice to the CORPORATION
Dated this 10th day of February, 2015 at public. The meeting is scheduled on
Rockville, Maryland. February 18, 2015. Multiemployer Pension Reform Act of
Mugeh Afshar-Tous, 2014; Partitions of Eligible
* * * * *
Acting Deputy Director, Office of Multiemployer Plans and Facilitated
International Programs. The NRC Commission Meeting Mergers
[FR Doc. 2015–03374 Filed 2–17–15; 8:45 am] Schedule can be found on the Internet
BILLING CODE 7590–01–P
at: http://www.nrc.gov/public-involve/ AGENCY: Pension Benefit Guaranty
public-meetings/schedule.html. Corporation.
* * * * * ACTION: Request for Information.
NUCLEAR REGULATORY The NRC provides reasonable
COMMISSION SUMMARY: This document is a request for
accommodation to individuals with information (RFI) to inform future PBGC
[NRC–2015–0001] disabilities where appropriate. If you guidance under sections 4231 and 4233
need a reasonable accommodation to of ERISA. PBGC is seeking comments
Sunshine Act Meeting Notice participate in these public meetings, or from all interested stakeholders,
need this meeting notice or the including multiemployer plan
DATE:Week of February 16, 2015. transcript or other information from the participants and beneficiaries,
PLACE:Commissioners’ Conference public meetings in another format (e.g. organizations serving or representing
Room, 11555 Rockville Pike, Rockville, braille, large print), please notify such individuals, multiemployer plan
Maryland. Kimberly Meyer, NRC Disability sponsors and professional advisors,
STATUS: Public and Closed. Program Manager, at 301–287–0727, by contributing employers, unions, and
Week of February 16, 2015 videophone at 240–428–3217, or by other interested parties.
email at Kimberly.Meyer-Chambers@ DATES: Comments must be received on
Wednesday, February 18, 2015 nrc.gov. Determinations on requests for or before April 6, 2015.
2:30 p.m. Discussion of Internal reasonable accommodation will be
ADDRESSES: Comments may be
Personnel Rules and Practices (Closed— made on a case-by-case basis.
submitted by any of the following
Ex. 2 & 9) * * * * * methods:
* * * * * Members of the public may request to • Federal eRulemaking Portal: http://
The schedule for Commission receive this information electronically. www.regulations.gov. Follow the Web
meetings is subject to change on short If you would like to be added to the site instructions for submitting
notice. For more information or to verify distribution, please contact the Nuclear comments.
the status of meetings, contact Glenn Regulatory Commission, Office of the • Email: reg.comments@pbgc.gov.
Ellmers at 301–415–0442 or via email at Secretary, Washington, DC 20555 (301– • Fax: 202–326–4224.
Glenn.Ellmers@nrc.gov. 415–1969), or email • Mail or Hand Delivery: Regulatory
emcdonald on DSK67QTVN1PROD with NOTICES

* * * * * Brenda.Akstulewicz@nrc.gov or Affairs Group, Office of the General
Patricia.Jimenez@nrc.gov. Counsel, Pension Benefit Guaranty
Additional Information Corporation, 1200 K Street NW.,
Dated: February 13, 2015.
By a vote of 4–0 on February 12, 2015, Washington, DC 20005–4026.
the Commission determined pursuant to Glenn Ellmers, All materials submitted will be shared
U.S.C. 552b(e) and ’9.107(a) of the Policy Coordinator, Office of the Secretary. with the Department of the Treasury
Commission’s rules that the above [FR Doc. 2015–03429 Filed 2–13–15; 4:15 pm] and the Department of Labor. Comments
referenced Discussion of Internal BILLING CODE 7590–01–P received, including personal

VerDate Sep<11>2014 19:32 Feb 17, 2015 Jkt 235001 PO 00000 Frm 00124 Fmt 4703 Sfmt 4703 E:\FR\FM\18FEN1.SGM 18FEN1
8714 Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices

Section 4233(e)(1) prescribes a • The transaction is not reasonably concurrently with an application for
continuing payment obligation that expected to be adverse to the overall benefit suspension to the Department of
applies to the plan that was partitioned interests of the participants and the Treasury, comments relating to the
(the original plan), which requires it to beneficiaries of any of the plans. interaction between these provisions are
pay a monthly benefit to each For purposes of section 4231(e), especially welcome. PBGC is not,
participant and beneficiary whose ‘‘facilitation’’ may include training, however, seeking comments on section
guaranteed benefit was transferred to technical assistance, mediation, 432(e)(9) of the Code or any other
the successor plan in the amount by communication with stakeholders, and provision of MPRA.
which the benefit that would be paid support with related requests to other The Department of the Treasury is
under the original plan’s terms (after government agencies. issuing its own RFI seeking comments
taking into account any benefit Section 4231(e)(2) prescribes four on certain matters that may be
suspensions under section 432(e)(9) of requirements that must be satisfied for addressed in future guidance
the Code and any plan amendments PBGC to provide financial assistance. implementing section 432(e)(9) of the
following the partition effective date) Specifically, the statute provides that to Code. PBGC and the Department of the
exceeds the PBGC-guaranteed benefit facilitate a merger that PBGC determines Treasury intend to coordinate on the
amount for that person.2 is necessary to enable one or more of the development of their processes as a
Section 4233(e)(3) sets forth a special plans involved to avoid or postpone result of these RFIs.
premium rule that applies to the plan insolvency, PBGC may provide financial
that was partitioned (the original plan), assistance only if the following Issues Affecting Both Partitions and
which requires it to pay the premiums conditions are met: Facilitated Mergers
for the participants whose benefits were • One or more of the multiemployer
1. Application Process: With respect
transferred to the successor plan for plans participating in the merger is in
to MPRA’s changes to the rules
each year during the 10-year period critical and declining status as defined
governing mergers and partitions under
following the partition effective date. in section 305 of ERISA (section 432 of
sections 4231 and 4233 of ERISA,
Finally, section 4233(f) provides notice the Code);
• PBGC reasonably expects that: (i) respectively, on which aspects of the
requirements that apply to PBGC (not application process would guidance be
plan sponsors). Such financial assistance will reduce
the corporation’s expected long-term needed or helpful?
Facilitated Mergers and Financial loss with respect to the plans involved; 2. PBGC Determinations: With respect
Assistance Under MPRA and (ii) such financial assistance is to a PBGC determination under section
necessary for the merged plan to become 4233(b)(3) that a partition is necessary
Section 121 of MPRA amends, but
or remain solvent; for a plan to remain solvent, or in the
does not replace, the existing
multiemployer merger rules under • PBGC certifies that its ability to case of a facilitated merger involving
meet existing financial assistance financial assistance under section
section 4231. Specifically, it adds
obligations to other plans will not be 4231(e)(2)(B) that financial assistance is
section 4231(e), which gives PBGC new
impaired by such financial assistance; necessary for a merged plan to become
statutory authority to facilitate the
and or remain solvent:
merger of two or more multiemployer
plans if certain requirements are met. In • PBGC financial assistance is paid • What types of actuarial and plan
contrast to the partition rule discussed exclusively from its multiemployer administrative information and analysis
above, a regulation is not required to fund. are available to demonstrate that a
implement section 4231(e). Request for Information partition or facilitated merger of the
Nevertheless, PBGC is considering plan is necessary to remain solvent?
PBGC is requesting information from • What issues arise in demonstrating
issuing guidance under that section so stakeholders on a range of issues
that applicants have advance notice of solvency over an extended duration?
regarding the application process for
the expected showing they must make partitions and facilitated mergers to 3. Small Plans: What special concerns
to demonstrate satisfaction of the new better inform its future guidance under do small multiemployer plans and their
statutory criteria. sections 121 and 122 of MPRA. sponsors have regarding partition and
Section 4231(e)(1) provides that when PBGC welcomes comments from all facilitated mergers?
requested to do so by the plan sponsors, interested stakeholders, including 4. Participants and Beneficiaries:
PBGC may take such actions as it deems participants and beneficiaries, What special concerns do participants
appropriate to promote and facilitate the organizations serving or representing and beneficiaries in multiemployer
merger of two or more multiemployer such individuals, plan sponsors and plans have regarding the process for
plans if it determines, after consultation professional advisors to multiemployer considering applications for partition
with the Participant and Plan Sponsor plans (including those in the actuarial and facilitated mergers?
Advocate, that the following conditions and legal communities), contributing
are met: Issues Affecting Partitions Only
employers, unions, and other interested
• The transaction is in the interests of parties. In responding, please provide as 5. Notice: With respect to the
the participants and beneficiaries of at much specificity and detail as possible, requirement under section 4233(a)(2) to
least one of the plans; and as well as any supporting provide notice to participants and
documentation, including research and beneficiaries not later than 30 days after
emcdonald on DSK67QTVN1PROD with NOTICES

2 In addition, under section 4233(e)(2), in the
analyses, to ensure that we have the submitting the application for partition:
event the original plan provides a benefit
improvement after the effective date of the
most helpful information for future • How can PBGC reduce the burden
partition, the plan must pay to PBGC for each year guidance. Recognizing the linkage of providing the notice under current
during the 10-year period following the partition, between MPRA’s partition rules and the law, while still providing important
an annual amount equal to the value of the increase benefit suspension rules under section information to participants and
in benefit payments for such year attributable to the
benefit improvement (or, if less, the total benefit
432(e)(9) of the Code, and the possibility beneficiaries? Should PBGC consider
payments from the plan created by the partition for that a plan sponsor may apply to PBGC issuing a model notice in future
such year). for a partition (or facilitated merger) guidance?

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Document Created: 2018-02-16 11:10:14
Document Modified: 2018-02-16 11:10:14
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		Notices
Action		Request for Information.
Dates		Comments must be received on or before April 6, 2015.
Contact		Joseph J. Shelton ([email protected]), Office of the General Counsel, at 202-326- 4000, ext. 6559, or Constance Markakis ([email protected]), Office of Negotiations and Restructuring, at 202-326-4000, ext. 6779; (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 8712