[Federal Register Volume 76, Number 10 (Friday, January 14, 2011)]
[Rules and Regulations]
[Pages 2578-2579]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-725]
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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 Pension Benefit Guaranty Corporation's
regulation on Benefits Payable in Terminated Single-Employer Plans to
prescribe interest assumptions under the regulation for valuation dates
in February 2011. Interest assumptions are also published on PBGC's Web
site (http://www.pbgc.gov).
DATES: Effective February 1, 2011.
FOR FURTHER INFORMATION CONTACT: Catherine B. Klion, Manager,
Regulatory and Policy Division, Legislative and Regulatory Department,
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 regulation on Benefits Payable in
Terminated Single-Employer Plans (29 CFR part 4022) prescribes
actuarial assumptions--including interest assumptions--for paying plan
benefits under terminating single-employer plans covered by title IV of
the Employee Retirement Income Security Act of 1974.
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 benefit
payments regulation are updated monthly. This final rule updates the
benefit payments interest assumptions for February 2011.\1\
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\1\ Appendix B to PBGC's regulation on Allocation of Assets in
Single-Employer Plans (29 CFR part 4044) prescribes interest
assumptions for valuing benefits under terminating covered single-
employer plans for purposes of allocation of assets under ERISA
section 4044. Those assumptions are updated quarterly.
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The February 2011 interest assumptions under the benefit payments
regulation will be 2.50 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 January 2011, these interest assumptions
represent an increase of 0.25 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 payment
of benefits under plans with valuation dates during February 2011, 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.
[[Page 2579]]
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 208, as set forth below, is
added to the table.
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) i1 i2 i3 n1 n2
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* * * * * * *
208 2-1-11 3-1-11 2.50 4.00 4.00 4.00 7 8
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0
3. In appendix C to part 4022, Rate Set 208, as set forth below, is
added to the table.
Appendix C to Part 4022--Lump Sum Interest Rates for Private-Sector
Payments
* * * * *
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For plans with a valuation date Immediate Deferred annuities (percent)
Rate set ---------------------------------- annuity rate ------------------------------------------------------------------------------------
On or after Before (percent) i1 i2 i3 n1 n2
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* * * * * * *
208 2-1-11 3-1-11 2.50 4.00 4.00 4.00 7 8
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Issued in Washington, DC, on this 10th day of January 2011.
Vincent K. Snowbarger,
Deputy Director for Operations, Pension Benefit Guaranty Corporation.
[FR Doc. 2011-725 Filed 1-13-11; 8:45 am]
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