SUPPLEMENTARY INFORMATION:

Background: On June 3, 2026, the Department published a notice of proposed exemption in the Federal Register at 91 FR 33200 (Proposed Exemption). The Proposed Exemption involves the Fund's purchase of the Property from the Union in exchange for a cash payment equal to the lesser of $1,610,000 or the appraised fair market value of the Property updated on the date of the sale. The Fund has leased the Property since 2011 for use by the Local #99 Joint Apprenticeship Training Committee (JATC) Training Program.

Benefits of the Exemption: The Department is granting relief based, in part, on the Applicant's representations that the Fund will: (1) save approximately $45,000 per year in operating expenses as a result of the Purchase; (2) not be required to reimburse the Union for the approximately $900,000 in improvements the Union made to the Property to make it suitable for the JATC Training Program; and (3) not pay any closing costs in connection with the purchase, which could total as much as $52,500.

Comments: In the Proposed Exemption, the Department invited all interested persons to submit written comments and/or requests for a public hearing with respect to the Proposed Exemption. All comments and requests for a hearing were due to the Department by July 20, 2026. The Department did not receive any written comments or requests for a public hearing with respect to the Proposed Exemption.^[1]

Based on the record, the Department has determined to grant the Proposed Exemption. In order to clarify the operative text, the Department has added a “Definitions” section and made several non-substantive edits. This exemption provides only the relief specified herein and does not provide relief from violations of any law other than the prohibited transaction provisions of ERISA. The Department makes the requisite findings under ERISA section 408(a) that the exemption is: (1) administratively feasible for the Department, (2) in the interest of the Fund and its participants and beneficiaries, and (3) protective of the rights of the participants and beneficiaries of the Fund, based on the Applicant's adherence to all the conditions and definitions of the exemption at all times. Accordingly, affected parties should be aware that the conditions and definitions incorporated in this exemption are, taken individually and as a whole, necessary for the Department to grant the relief requested by the Applicant.

The complete application file (L-12076) is available for public inspection in the Public Disclosure Room of the Employee Benefits Security Administration, Room N-1515, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20210, reachable by telephone at 1-866-444-3272. For a more complete statement of the facts and representations supporting the Department's decision to grant this exemption, please refer to the Proposed Exemption.

General Information

The attention of interested persons is directed to the following:

(1) The fact that a transaction is the subject of an exemption under ERISA section 408(a) does not relieve a fiduciary or other party in interest from certain other provisions of ERISA, including any prohibited transaction provisions to which the exemption does not apply and the general fiduciary responsibility provisions of ERISA section 404, which, among other things, require a fiduciary to discharge their duties respecting the plan solely in the interest of the participants and beneficiaries of the plan and in a prudent fashion in accordance with ERISA section 404(a)(1)(B);

(2) As required by ERISA section 408(a), the Department hereby finds that the exemption is (1) administratively feasible for the Department, (2) in the interests of the Fund and its participants and beneficiaries, and (3) protective of the rights of participants and beneficiaries of the Fund;

(3) The exemption is supplemental to, and not in derogation of, any other ERISA provisions, including statutory or administrative exemptions and transitional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption is not dispositive of determining whether the transaction is in fact a prohibited transaction; and

(4) The availability of this exemption is subject to the express condition that the material facts and representations ( printed page 66165) contained in the application accurately describe all material terms of the transactions that are the subject of the exemption and are true at all times.

Accordingly, after considering the entire record developed in connection with the Applicant's exemption application, the Department has determined to grant the following exemption under the authority of ERISA section 408(a) in accordance with the Department's exemption procedures regulation set forth in 29 CFR part 2570, subpart B.^[2]

Exemption

Section I. Definitions

(a) “Fund” or “Applicant” means the International Brotherhood of Electrical Workers Local Union No. 99 Joint Apprenticeship Training Fund.

(b) “Union” means IBEW Local 99, a local chapter of the International Brotherhood of Electrical Workers.

(c) “Realty Corp” means Local Union 99 Realty Corporation, an entity 100% owned and controlled by the Union.

(d) “Property” means the one-story metal and masonry office building located at 40 Western Industrial Drive, Cranston, Rhode Island.

(e) “Independent Fiduciary” means Gallagher Fiduciary Advisors, LLC, the entity prudently appointed by the Fund's Board of Trustees to act as the independent fiduciary on behalf of the Fund in connection with the exemption.

(f) “Independent Appraiser” means Peter M. Scotti & Associates of Providence, Rhode Island.

(g) “Purchase” means the Fund's acquisition of the Property from Realty Corp for cash.

(h) “Appraisal Report” means the report prepared by the Independent Appraiser appraising the Property, detailing the appraiser's findings, methodologies, and conclusions regarding the value of the Property.

Section II. Covered Transactions

The restrictions of ERISA sections 406(a)(1)(A), 406(a)(1)(D), 406(b)(1), and 406(b)(2) do not apply to the Fund's purchase of the Property from Realty Corp, a party in interest with respect to the Fund, provided the conditions in Section III are met.

Section III. Conditions

(a) The Purchase is a one-time transaction for cash. In the event the Fund finances the Purchase, it will do so with an unrelated, third-party bank and on terms that the Independent Fiduciary determines in writing are prudent and in the interest of, and protective of the rights of, the Fund;

(b) The Fund pays the lesser of either: (1) $1,610,000; or (2) the fair market value of the Property as established in an Appraisal Report that is updated on the date of the Purchase;

(c) The terms and conditions of the Purchase are no less favorable to the Fund than the terms the Fund would receive under similar circumstances in an arm's length transaction with an unrelated party;

(d) The Fund pays no fees, costs, commissions, or other expenses, other than necessary and reasonable fees, to any party in interest in connection with the Purchase;

(e) The Purchase is not part of an agreement, arrangement or understanding designed to benefit the Union;

(f) The Independent Appraiser must not have entered into, and must not enter into, any agreement, arrangement, or understanding that includes any provision that: (1) provides for the direct or indirect indemnification or reimbursement of the Independent Appraiser by the Fund or any other party for any failure to adhere to its contractual obligations or to state or Federal laws applicable to the Independent Appraiser's work; or (2) waives any rights, claims or remedies of the Fund or its participants and beneficiaries under ERISA or other Federal and state laws against the Independent Appraiser with respect to the Purchase;

(g) The Independent Fiduciary, prudently hired by the Fund's Board of Trustees:

(1) Represents the Fund's interests for all purposes with respect to the Purchase;

(2) Determines in writing that the Purchase is in the interest of, and protective of, the Fund and its participants and beneficiaries, based on the most current information and assumptions;

(3) Reviews and approves the terms and conditions of the Purchase and any related transactions and takes any action necessary to enforce the rights of the Fund in connection with such transactions;

(4) Reviews the Appraisal Report, confirms that the underlying methodology is reasonable and accurate, and confirms that the valuation of the Property was reasonably derived;

(5) Ensures that the Independent Appraiser renders an updated fair market valuation of the Property as of the date of the Purchase;

(6) Determines in writing whether it is prudent for the Fund to proceed with the Purchase, based on the most current information and assumptions;

(7) Prepares a final report certifying that every condition in the exemption has been met with a description of any steps taken or information verified in order to make such certifications. The report will be delivered to the Department at e-OED@dol.gov within 60 days of the date of closing of the Purchase;

(h) The Independent Fiduciary must not have entered into, and must not enter into, any agreement, arrangement, or understanding that includes any provision that: provides for the direct or indirect indemnification or reimbursement of the Independent Fiduciary by the Fund or other party for any failure to adhere to its contractual obligations or to state or Federal laws applicable to the Independent Fiduciary's work; or waives any rights, claims, or remedies of the Fund under ERISA, state, or Federal law against the Independent Fiduciary with respect to the transaction that is the subject of the exemption;

(i) The Independent Fiduciary must not enter into any agreement or instrument in connection with its appointment as Independent Fiduciary that violates section 410 of ERISA or section 2509.75-4 of the Department's regulations;

(j) The Fund's Board of Trustees and the Independent Fiduciary maintain for a period of six (6) years from the date of the Purchase, in a manner that is convenient and accessible for audit and examination, the records necessary to enable the persons described in paragraph (k)(1) below to determine whether conditions of this exemption have been met, except that (i) a prohibited transaction will not be considered to have occurred if, due to circumstances beyond the control of the Fund's Board of Trustees and/or the Independent Fiduciary, the records are lost or destroyed prior to the end of the six-year period, and (ii) no party in interest other than the Fund's Board of Trustees or the Independent Fiduciary shall be subject to the civil penalty that may be assessed under ERISA section 502(i) if the records are not maintained, or are not available for examination as required by paragraph (k) below; and

(k)(1) Except as provided in section (2) of this paragraph and notwithstanding any provisions of subsections (a)(2) and (b) of ERISA section 504, the records referred to in paragraph (j) above shall be unconditionally available at their ( printed page 66166) customary location during normal business hours to:

(i) any duly authorized employee or representative of the Department or the Internal Revenue Service;

(ii) the Fund's Board of Trustees or any duly authorized representative of the Fund's Board of Trustees;

(iii) the Independent Fiduciary or any duly authorized representative of the Independent Fiduciary;

(iv) any participant or beneficiary of the Fund, or any duly authorized representative of such participant or beneficiary;

(2) Should any party refuse to disclose information to a person on the basis that such information is exempt from disclosure, such party shall, by the close of the thirtieth (30th) day following the request, provide a written notice advising that person of the reasons for the refusal and that the Department may request such information;

(l) The Union, the Fund's Board of Trustees, and/or the Independent Fiduciary must provide to the Department the records necessary to demonstrate that the conditions of this exemption, as amended, have been met, within 30 days from the date the Department requests such records; and

(m) All the material facts and representations made by the Applicant that are set forth in the Summary of Facts and Representations of the Proposed Exemption are true and accurate at all times. If there is any material change in a transaction covered by the exemption, or in a material fact or representation described by the Applicant in the application, the exemption will cease to apply as of the date of the change.

Exemption date: The exemption will be in effect as of the date of publication of this final exemption in the Federal Register .