Allocation of Assets in Single-Employer Plans; Benefits Payable in Terminated Single-Employer Plans; Interest Assumptions for Valuing and Paying Benefits, 35838-35839 [2012-14722]
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35838
Federal Register / Vol. 77, No. 116 / Friday, June 15, 2012 / Rules and Regulations
PENSION BENEFIT GUARANTY
CORPORATION
29 CFR Parts 4022 and 4044
Allocation of Assets in SingleEmployer Plans; Benefits Payable in
Terminated Single-Employer Plans;
Interest Assumptions for Valuing and
Paying Benefits
Pension Benefit Guaranty
Corporation.
ACTION: Final rule.
AGENCY:
This final rule amends the
Pension Benefit Guaranty Corporation’s
regulations on Benefits Payable in
Terminated Single-Employer Plans and
Allocation of Assets in Single-Employer
Plans to prescribe interest assumptions
under the benefit payments regulation
for valuation dates in July 2012 and
interest assumptions under the asset
allocation regulation for valuation dates
in the third quarter of 2012. The interest
assumptions are used for valuing and
paying benefits under terminating
single-employer plans covered by the
pension insurance system administered
by PBGC.
DATES: Effective July 1, 2012.
FOR FURTHER INFORMATION CONTACT:
Catherine B. Klion
(Klion.Catherine@PBGC.gov), 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
regulations on Allocation of Assets in
Single-Employer Plans (29 CFR part
4044) and Benefits Payable in
Terminated Single-Employer Plans
(29 CFR part 4022) prescribe actuarial
assumptions—including interest
assumptions—for valuing and paying
plan benefits under terminating singleemployer plans covered by title IV of
the Employee Retirement Income
Security Act of 1974. The interest
assumptions in the regulations are also
SUMMARY:
Rate set
For plans with a valuation
date
srobinson on DSK4SPTVN1PROD with RULES
On or after
*
225
VerDate Mar<15>2010
Before
*
7–1–12
17:55 Jun 14, 2012
published on PBGC’s Web site (https://
www.pbgc.gov).
The interest assumptions in Appendix
B to Part 4044 are used to value benefits
for allocation purposes under ERISA
section 4044. 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 asset allocation
regulation are updated quarterly;
assumptions under the benefit payments
regulation are updated monthly. This
final rule updates the benefit payments
interest assumptions for July 2012 and
updates the asset allocation interest
assumptions for the third quarter (July
through September) of 2012.
The third quarter 2012 interest
assumptions under the allocation
regulation will be 2.95 percent for the
first 20 years following the valuation
date and 3.66 percent thereafter. In
comparison with the interest
assumptions in effect for the second
quarter of 2012, these interest
assumptions represent no change in the
select period (the period during which
the select rate (the initial rate) applies),
a decrease of 0.16 percent in the select
rate, and an increase of 0.30 percent in
the ultimate rate (the final rate).
The July 2012 interest assumptions
under the benefit payments regulation
will be 1.00 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 June 2011,
these interest assumptions represent a
decrease of 0.25 percent in the
immediate annuity rate and are
otherwise unchanged.
*
Jkt 226001
PO 00000
1.00
Frm 00030
List of Subjects
29 CFR Part 4022
Employee benefit plans, Pension
insurance, Pensions, Reporting and
recordkeeping requirements.
29 CFR Part 4044
Employee benefit plans, Pension
insurance, Pensions.
In consideratin of the foregoing, 29
CFR parts 4022 and 4044 are amended
as follows:
PART 4022—BENEFITS PAYABLE IN
TERMINATED SINGLE-EMPLOYER
PLANS
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.
2. In appendix B to part 4022, Rate Set
225, as set forth below, is added to the
table.
■
Appendix B to Part 4022—Lump Sum
Interest Rates for PBGC Payments
*
*
*
*
*
Deferred annuities (percent)
Immediate
annuity rate
(percent)
8–1–12
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 valuation
and payment of benefits under plans
with valuation dates during July 2012,
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).
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35839
Federal Register / Vol. 77, No. 116 / Friday, June 15, 2012 / Rules and Regulations
3. In appendix C to part 4022, Rate Set
225, as set forth below, is added to the
table.
■
Appendix C to Part 4022—Lump Sum
Interest Rates for Private-Sector
Payments
*
Rate set
For plans with a valuation
date
On or after
*
225
Before
*
*
*
Deferred annuities (percent)
Immediate
annuity rate
(percent)
*
i1
8–1–12
1.00
i2
*
4.00
*
7–1–12
*
i3
4.00
n1
*
n2
*
*
4.00
7
8
Authority: 29 U.S.C. 1301(a), 1302(b)(3),
1341, 1344, 1362.
PART 4044—ALLOCATION OF
ASSETS IN SINGLE-EMPLOYER
PLANS
Appendix B to Part 4044—Interest
Rates Used To Value Benefits
5. In appendix B to part 4044, a new
entry for July–September 2012, as set
forth below, is added to the table.
*
■
4. The authority citation for part 4044
continues to read as follows:
■
*
*
*
*
The values of it are:
For valuation dates occurring in the month—
for t =
it
*
*
*
July–September 2012 ...........................................................
Issued in Washington, DC, on this 11th day
of June 2012.
John H. Hanley,
Director, Legislative and Regulatory
Department, Pension Benefit Guaranty
Corporation.
1–20
*
0.0366
>20
*
0.0295
ADDRESSES:
BILLING CODE 7709–01–P
DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Parts 100 and 165
[Docket No. USCG–2012–0100]
RIN 1625–AA00; 1625–AA08
Special Local Regulation and Security
Zone: War of 1812 Bicentennial
Commemoration, Port of Boston, MA
Coast Guard, DHS.
Temporary final rule.
AGENCY:
ACTION:
VerDate Mar<15>2010
15:51 Jun 14, 2012
Jkt 226001
during the heavy volume of vessel
traffic expected during this event.
This rule is effective and will be
enforced from 9 a.m. on June 29, 2012
to 6 p.m. on July 6, 2012.
Documents mentioned in
this preamble are part of docket USCG–
2012–0100. To view documents
mentioned in this preamble as being
available in the docket, go to https://
www.regulations.gov, type the docket
number in the ‘‘SEARCH’’ Box and click
‘‘SEARCH.’’ Click on Open Docket
Folder on the line associated with the
rulemaking. You may also visit the
Docket Management Facility in Room
W12–140 on the ground floor of the
Department of Transportation, West
Building, 1200 New Jersey Avenue SE.,
Washington, DC 20590, between 9 a.m.
and 5 p.m., Monday through Friday,
except Federal holidays.
If
you have questions on this temporary
final rule, call or email Mr. Mark Cutter,
Coast Guard Sector Boston Waterways
Management Division, telephone 617–
223–4000, email
Mark.E.Cutter@uscg.mil. If you have
questions on viewing or submitting
material to the docket, call Renee V.
Wright, Program Manager, Docket
Operations, telephone 202–366–9826.
FOR FURTHER INFORMATION CONTACT:
The Coast Guard is
establishing a temporary special local
regulation and temporary security zones
during and after the War of 1812
Bicentennial Commemoration events in
the Port of Boston, Massachusetts, to be
held between June 28, 2012 and July 6,
2012. These regulations are necessary to
promote the safe navigation of vessels
and the safety of life and property
SUMMARY:
srobinson on DSK4SPTVN1PROD with RULES
for t =
DATES:
[FR Doc. 2012–14722 Filed 6–14–12; 8:45 am]
it
SUPPLEMENTARY INFORMATION:
PO 00000
Frm 00031
Fmt 4700
Sfmt 4700
it
*
N/A
for t =
*
N/A
Table of Acronyms
DHS Department of Homeland Security
FR Federal Register
NPRM Notice of Proposed Rulemaking
A. Regulatory History and Information
On April 3, 2012, we published a
notice of proposed rulemaking (NPRM)
entitled: Special Local Regulation and
Security Zone: War of 1812 Bicentennial
Commemoration, Port of Boston,
Massachusetts; in the Federal Register
(77 FR 19963). Two comments were
received in the proposed rule’s docket:
• One comment was accidentally
misfiled from an unrelated FAA
regulation and did not pertain to our
proposed rulemaking. It has since been
removed from the docket for this rule by
the Docket Management System.
• One comment asked simply ‘‘Will
there be any provisions for Press Boats
for the event? If so how should the
vessel be flagged or identified as such?’’
The Coast Guard recommends that a
boat with members of the media
onboard, display something with the
word ‘‘MEDIA’’ that is visible to other
vessels.
No public meeting was requested of
the Coast Guard, and none was held.
The event sponsor hosted a planning
and coordination meeting that was open
to the public on October 12, 2011 and
held an Initial Planning Conference on
February 14–15, 2012 and a mid-term
planning conference on May 8, 2012 in
E:\FR\FM\15JNR1.SGM
15JNR1
]]>Agencies
[Federal Register Volume 77, Number 116 (Friday, June 15, 2012)]
[Rules and Regulations]
[Pages 35838-35839]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-14722]
[[Page 35838]]
=======================================================================
-----------------------------------------------------------------------
PENSION BENEFIT GUARANTY CORPORATION
29 CFR Parts 4022 and 4044
Allocation of Assets in Single-Employer Plans; Benefits Payable
in Terminated Single-Employer Plans; Interest Assumptions for Valuing
and Paying Benefits
AGENCY: Pension Benefit Guaranty Corporation.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule amends the Pension Benefit Guaranty
Corporation's regulations on Benefits Payable in Terminated Single-
Employer Plans and Allocation of Assets in Single-Employer Plans to
prescribe interest assumptions under the benefit payments regulation
for valuation dates in July 2012 and interest assumptions under the
asset allocation regulation for valuation dates in the third quarter of
2012. The interest assumptions are used for valuing and paying benefits
under terminating single-employer plans covered by the pension
insurance system administered by PBGC.
DATES: Effective July 1, 2012.
FOR FURTHER INFORMATION CONTACT: Catherine B. Klion
(Klion.Catherine@PBGC.gov), 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 regulations on Allocation of Assets
in Single-Employer Plans (29 CFR part 4044) and Benefits Payable in
Terminated Single-Employer Plans (29 CFR part 4022) prescribe actuarial
assumptions--including interest assumptions--for valuing and paying
plan benefits under terminating single-employer plans covered by title
IV of the Employee Retirement Income Security Act of 1974. The interest
assumptions in the regulations are also published on PBGC's Web site
(https://www.pbgc.gov).
The interest assumptions in Appendix B to Part 4044 are used to
value benefits for allocation purposes under ERISA section 4044. 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 asset
allocation regulation are updated quarterly; assumptions under the
benefit payments regulation are updated monthly. This final rule
updates the benefit payments interest assumptions for July 2012 and
updates the asset allocation interest assumptions for the third quarter
(July through September) of 2012.
The third quarter 2012 interest assumptions under the allocation
regulation will be 2.95 percent for the first 20 years following the
valuation date and 3.66 percent thereafter. In comparison with the
interest assumptions in effect for the second quarter of 2012, these
interest assumptions represent no change in the select period (the
period during which the select rate (the initial rate) applies), a
decrease of 0.16 percent in the select rate, and an increase of 0.30
percent in the ultimate rate (the final rate).
The July 2012 interest assumptions under the benefit payments
regulation will be 1.00 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 June 2011, these interest assumptions
represent a decrease 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 valuation
and payment of benefits under plans with valuation dates during July
2012, 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
29 CFR Part 4022
Employee benefit plans, Pension insurance, Pensions, Reporting and
recordkeeping requirements.
29 CFR Part 4044
Employee benefit plans, Pension insurance, Pensions.
In consideratin of the foregoing, 29 CFR parts 4022 and 4044 are
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 225, as set forth below, is
added to the table.
Appendix B to Part 4022--Lump Sum Interest Rates for PBGC Payments
* * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
For plans with a valuation date Immediate Deferred annuities (percent)
Rate set ---------------------------------- annuity rate ------------------------------------------------------------------------------------
On or after Before (percent) i1 i2 i3 n1 n2
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
225 7-1-12 8-1-12 1.00 4.00 4.00 4.00 7 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 35839]]
0
3. In appendix C to part 4022, Rate Set 225, as set forth below, is
added to the table.
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) i1 i2 i3 n1 n2
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
225 7-1-12 8-1-12 1.00 4.00 4.00 4.00 7 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
PART 4044--ALLOCATION OF ASSETS IN SINGLE-EMPLOYER PLANS
0
4. The authority citation for part 4044 continues to read as follows:
Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.
0
5. In appendix B to part 4044, a new entry for July-September 2012, as
set forth below, is added to the table.
Appendix B to Part 4044--Interest Rates Used To Value Benefits
* * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
The values of it are:
For valuation dates occurring in the --------------------------------------------------------------------------------------------------------------
month-- it for t = it for t = it for t =
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
July-September 2012...................... 0.0295 1-20 0.0366 >20 N/A N/A
--------------------------------------------------------------------------------------------------------------------------------------------------------
Issued in Washington, DC, on this 11th day of June 2012.
John H. Hanley,
Director, Legislative and Regulatory Department, Pension Benefit
Guaranty Corporation.
[FR Doc. 2012-14722 Filed 6-14-12; 8:45 am]
BILLING CODE 7709-01-P
