[Federal Register Volume 85, Number 95 (Friday, May 15, 2020)]
[Rules and Regulations]
[Pages 29323-29324]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-10075]
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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.
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SUMMARY: This final rule amends the Pension Benefit Guaranty
Corporation's regulation on Benefits Payable in Terminated Single-
Employer Plans to prescribe certain interest assumptions under the
regulation for plans with valuation dates in June 2020. These interest
assumptions are used for paying certain benefits under terminating
single-employer plans covered by the pension insurance system
administered by PBGC.
DATES: Effective June 1, 2020.
FOR FURTHER INFORMATION CONTACT: Gregory Katz ([email protected]),
Attorney, Regulatory Affairs Division, Pension Benefit Guaranty
Corporation,
[[Page 29324]]
1200 K Street NW, Washington, DC 20005, 202-326-4400 ext. 3829. (TTY
users may call the Federal relay service toll-free at 1-800-877-8339
and ask to be connected to 202-326-4400, ext. 3829.)
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 terminated single-employer plans covered by title IV of
the Employee Retirement Income Security Act of 1974 (ERISA). The
interest assumptions in the regulation are also published on PBGC's
website (https://www.pbgc.gov).
PBGC uses the interest assumptions in appendix B to part 4022
(``Lump Sum Interest Rates for PBGC Payments'') to determine whether a
benefit is payable as a lump sum and to determine the amount to pay.
Because some private-sector pension plans use these interest rates to
determine lump sum amounts payable to plan participants (if the
resulting lump sum is larger than the amount required under section
417(e)(3) of the Internal Revenue Code and section 205(g)(3) of ERISA),
these rates are also provided in appendix C to part 4022 (``Lump Sum
Interest Rates for Private-Sector Payments'').
This final rule updates appendices B and C of the benefit payments
regulation to provide the rates for June 2020 measurement dates.
The June 2020 lump sum interest assumptions will be 0.00 percent
for the period during which a benefit is (or is assumed to be) 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 May 2020, these assumptions represent a decrease of 0.50
percent in the immediate rate and are otherwise unchanged.
PBGC updates appendices B and C each month. 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
issue new interest assumptions promptly so that they are available for
plans that rely on our publication of them each month to calculate lump
sum benefit amounts.
Because of the need to provide immediate guidance for the payment
of benefits under plans with valuation dates during June 2020, 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'' 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.
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 320 is added at the end of the
table to read as follows:
Appendix B to Part 4022--Lump Sum Interest Rates for PBGC Payments
* * * * *
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For plans with a valuation date Immediate Deferred annuities (percent)
Rate set ---------------------------------- annuity rate ------------------------------------------------------------------------------------
On or after Before (percent) i i i n n
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
320 6-1-20 7-1-20 0.00 4.00 4.00 4.00 7 8
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0
3. In appendix C to part 4022, rate set 320 is added at the end of 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) i i i n n
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
320 6-1-20 7-1-20 0.00 4.00 4.00 4.00 7 8
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Issued in Washington, DC.
Hilary Duke,
Assistant General Counsel for Regulatory Affairs, Pension Benefit
Guaranty Corporation.
[FR Doc. 2020-10075 Filed 5-14-20; 8:45 am]
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