[Federal Register Volume 75, Number 198 (Thursday, October 14, 2010)]
[Proposed Rules]
[Pages 63106-63107]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-25855]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 75, No. 198 / Thursday, October 14, 2010 /
Proposed Rules
[[Page 63106]]
FEDERAL RETIREMENT THRIFT INVESTMENT BOARD
5 CFR Part 1605
Correction of Administrative Errors
AGENCY: Federal Retirement Thrift Investment Board.
ACTION: Proposed rule with request for comments.
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SUMMARY: The Federal Retirement Thrift Investment Board (Agency)
proposes to use a constructed share price for retired Lifecycle funds
in order to make error corrections after December 31st of the target
year.
DATES: Comments must be received on or before November 15, 2010.
ADDRESSES: You may submit comments using one of the following methods:
Federal Rulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: Office of General Counsel, Attn: Thomas Emswiler,
Federal Retirement Thrift Investment Board, 1250 H Street, NW.,
Washington, DC 20005.
Hand Delivery/Courier: The address for sending comments by
hand delivery or courier is the same as that for submitting comments by
mail.
Facsimile: Comments may be submitted by facsimile at (202)
942-1676.
The most helpful comments explain the reason for any recommended
change and include data, information, and the authority that supports
the recommended change. We will post all substantive comments
(including any personal information provided) without change (with the
exception of redaction of SSNs, profanities, et cetera) on http://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Laurissa Stokes at (202) 942-1645.
SUPPLEMENTARY INFORMATION: The Agency administers the Thrift Savings
Plan (TSP), which was established by the Federal Employees' Retirement
System Act of 1986 (FERSA), Public Law 99-335, 100 Stat. 514. The TSP
provisions of FERSA are codified, as amended, largely at 5 U.S.C. 8351
and 8401-79. The TSP is a tax-deferred retirement savings plan for
Federal civilian employees and members of the uniformed services. The
TSP is similar to cash or deferred arrangements established for
private-sector employees under section 401(k) of the Internal Revenue
Code (26 U.S.C. 401(k)).
Constructed Share Price
The Agency currently offers five Lifecycle funds: L Income, L 2010,
L 2020, L 2030, and L 2040. The Agency will retire the L 2010 Fund when
it reaches its target date of December 31, 2010. Upon retiring the L
2010 Fund, the Agency will transfer all money invested in the L 2010
Fund to the L Income Fund. Participants will no longer be able to make
contributions to the L 2010 Fund after December 31, 2010. In effect,
the L 2010 Fund will no longer exist.
The Agency anticipates receiving late and makeup contributions that
would have been invested in the L 2010 Fund had they been made on time.
Likewise, the Agency anticipates needing to remove funds erroneously
contributed to the L 2010 Fund prior to its retirement date, i.e., do a
negative adjustment. The Agency uses the current share price of the
applicable investment fund when calculating the value of late
contributions, makeup contributions, and negative adjustments. Because
the L 2010 fund will no longer exist, the Agency must construct an
appropriate ``current'' share price in order to make error corrections
involving the L 2010 Fund after December 31, 2010.
The Agency proposes to calculate the constructed share price for
the L 2010 Fund as follows: The constructed share price is the L 2010
Fund share price on December 31, 2010, multiplied by the current L
Income Fund share price, divided by the L Income Fund share price on
December 31, 2010. This calculation reflects the impact of merging the
assets of the L 2010 Fund into the L Income Fund on December 31, 2010.
The Agency will apply this calculation to retired Lifecycle funds in
the future by substituting the L 2010 Fund and December 31, 2010
retirement date as follows: The constructed share price is the retired
Lifecycle fund share price on December 31 of the retirement year,
multiplied by the current L Income Fund share price, divided by the L
Income Fund share price on December 31 of the retirement year.
Regulatory Flexibility Act
I certify that this regulation will not have a significant economic
impact on a substantial number of small entities. This regulation will
affect Federal employees and members of the uniformed services who
participate in the Thrift Savings Plan, which is a Federal defined
contribution retirement savings plan created under the Federal
Employees' Retirement System Act of 1986 (FERSA), Public Law 99-335,
100 Stat. 514, and which is administered by the Agency.
Paperwork Reduction Act
I certify that these regulations do not require additional
reporting under the criteria of the Paperwork Reduction Act.
Unfunded Mandates Reform Act of 1995
Pursuant to the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 602,
632, 653, 1501-1571, the effects of this regulation on state, local,
and tribal governments and the private sector have been assessed. This
regulation will not compel the expenditure in any one year of $100
million or more by state, local, and tribal governments, in the
aggregate, or by the private sector. Therefore, a statement under
section 1532 is not required.
List of Subjects in 5 CFR Part 1605
Claims, Government employees, Pensions, Retirement.
Gregory T. Long,
Executive Director, Federal Retirement Thrift Investment Board.
For the reasons set forth in the preamble, the Agency proposes to
amend 5 CFR part 1605 as follows:
PART 1605--CORRECTION OF ADMINISTRATIVE ERRORS
1. The authority citation for part 1605 continues to read as
follows:
Authority: 5 U.S.C. 8351, 8432a, and 8474(b)(5) and (c)(1).
Subpart B also issued under section 1043(b) of Public Law 104-106,
110 Stat. 186 and sec. 7202(m)(2) of Public Law 101-508, 104 Stat.
1388.
[[Page 63107]]
Sec. 1605.2 [Amended]
2. Amend Sec. 1605.2, by revising paragraph (b)(1)(iii) and adding
paragraph (b)(1)(iv) to read as follows:
* * * * *
(b) * * *
(1) * * *
(iii) Determine the dollar value on the posting date of the number
of shares the participant would have received had the contributions or
loan payments been made on time. If the contributions or loan payments
would have been invested in a Lifecycle fund that is retired on the
posting date, the constructed share price shall equal the retired
Lifecycle fund share price on December 31 of the retirement year,
multiplied by the current L Income Fund share price, divided by the L
Income Fund share price on December 31 of the retirement year. The
dollar value shall be the number of shares the participant would have
received had the contributions or loan payments been made on time
multiplied by the constructed share price.
(iv) The difference between the dollar value of the contribution or
loan payment on the posting date and the dollar value of the
contribution or loan payment on the ``as of'' date is the breakage.
* * * * *
Sec. 1605.12 [Amended]
3. Amend Sec. 1605.12, by revising paragraph (c)(2)(ii) to read as
follows:
* * * * *
(c) * * *
(2) * * *
(ii) Multiply the price per share on the date the adjustment is
posted by the number of shares calculated in paragraph (c)(2)(i) of
this section. If the contribution was erroneously contributed to a
Lifecycle fund that is retired on the date the adjustment is posted,
the price per share shall equal the retired Lifecycle fund share price
on December 31 of the retirement year, multiplied by the current L
Income Fund share price, divided by the L Income Fund share price on
December 31 of the retirement year.
* * * * *
[FR Doc. 2010-25855 Filed 10-13-10; 8:45 am]
BILLING CODE 6760-01-P