Allocation of Assets in Single-Employer Plans; Benefits Payable in Terminated Single-Employer Plans; Interest Assumptions for Valuing and Paying Benefits, 27713-27714 [2019-12455]

Download as PDF Federal Register / Vol. 84, No. 115 / Friday, June 14, 2019 / Rules and Regulations § 240.17a–5 Reports to be made by certain brokers and dealers. * * * * * (e) * * * (1)(i) * * * (A) The securities business of the broker or dealer has been limited to acting as broker (agent) for a single issuer in soliciting subscriptions for securities of that issuer, the broker has promptly transmitted to the issuer all funds and promptly delivered to the subscriber all securities received in connection with the transaction, and the broker has not otherwise held funds or securities for or owed money or securities to customers; or * * * * * By the Commission Dated: June 10, 2019. Vanessa A. Countryman, Acting Secretary. [FR Doc. 2019–12563 Filed 6–13–19; 8:45 am] BILLING CODE 8011–01–P 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 certain interest assumptions under the benefit payments regulation for plans with valuation dates in July 2019 and interest assumptions under the asset allocation regulation for plans with valuation dates in the third quarter of 2019. These interest assumptions are used for valuing benefits and paying certain benefits under terminating single-employer plans covered by the pension insurance system administered by PBGC. DATES: Effective July 1, 2019. FOR FURTHER INFORMATION CONTACT: Gregory Katz (katz.gregory@pbgc.gov), Attorney, Regulatory Affairs Division, Pension Benefit Guaranty Corporation, 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.) jbell on DSK3GLQ082PROD with RULES SUMMARY: VerDate Sep<11>2014 16:06 Jun 13, 2019 Jkt 247001 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 (ERISA). The interest assumptions in the regulations are also published on PBGC’s website (https://www.pbgc.gov). SUPPLEMENTARY INFORMATION: Lump Sum Interest Assumption 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 as a lump sum. 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 July 2019 measurement dates. The July 2019 lump sum interest assumptions will be 0.75 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 June 2019, these assumptions represent a decrease of 0.25 percent in the immediate rate and are otherwise unchanged. Valuation/Asset Allocation Interest Assumptions PBGC uses the interest assumptions in appendix B to part 4044 (‘‘Interest Rates Used to Value Benefits’’) to value benefits for allocation purposes under section 4044 of ERISA, and some private-sector pension plans use them to determine benefit liabilities reportable under section 4044 of ERISA and for other purposes. The third quarter 2019 interest assumptions will be 2.92 percent for the first 25 years following the valuation date and 3.07 percent thereafter. In comparison with the interest assumptions in effect for the second quarter of 2019, these interest assumptions represent an increase of five years in the select period (the PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 27713 period during which the select rate (the initial rate) applies), a decrease of 0.15 percent in the select rate, and an increase of 0.02 percent in the ultimate rate (the final rate). Need for Immediate Guidance PBGC updates appendix B of the asset allocation regulation each quarter and appendices B and C of the benefit payments regulation 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 to value benefits and, for plans that rely on our publication of them each month or each quarter, to calculate lump sum benefit amounts. Because of the need to provide immediate guidance for the valuation and payment of benefits under plans with valuation dates during July 2019, 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 consideration 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 309 is added at the end of the table to read as follows: ■ Appendix B to Part 4022—Lump Sum Interest Rates for PBGC Payments * E:\FR\FM\14JNR1.SGM * * 14JNR1 * * 27714 Federal Register / Vol. 84, No. 115 / Friday, June 14, 2019 / Rules and Regulations Rate set * For plans with a valuation date On or after Before Immediate annuity rate (percent) * * 8–1–19 0.75 309 7–1–19 3. In appendix C to part 4022, Rate Set 309 is added at the end of the table to read as follows: ■ * * Before * * 8–1–19 0.75 4. The authority citation for part 4044 continues to read as follows: * * July–September 2019 ............................... Issued in Washington, DC. Hilary Duke, Assistant General Counsel, Pension Benefit Guaranty Corporation. [FR Doc. 2019–12455 Filed 6–13–19; 8:45 am] BILLING CODE 7709–02–P DEPARTMENT OF THE TREASURY Office of Foreign Assets Control 31 CFR Parts 501, 510, 535, 536, 539, 541, 542, 544, 546, 547, 548, 549, 560, 561, 566, 576, 583, 584, 588, 592, 594, 595, 597, and 598 Inflation Adjustment of Civil Monetary Penalties Office of Foreign Assets Control, Treasury. ACTION: Final rule. AGENCY: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing this final rule to adjust certain civil monetary penalties (CMPs) for inflation pursuant to the Federal Civil Penalties Inflation 16:06 Jun 13, 2019 Jkt 247001 n1 4.00 * 4.00 4.00 * n2 * 7 8 n1 n2 * Deferred annuities (percent) i1 i2 i3 4.00 * 4.00 4.00 * * * 7 8 Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362. Appendix B to Part 4044—Interest Rates Used to Value Benefits 5. In appendix B to part 4044, an entry for ‘‘July–September 2019’’ is added at the end of the table to read as follows: * * * * * The values of it are: For valuation dates occurring in the month— SUMMARY: i3 ■ ■ jbell on DSK3GLQ082PROD with RULES * On or after PART 4044—ALLOCATION OF ASSETS IN SINGLE-EMPLOYER PLANS VerDate Sep<11>2014 * Immediate annuity rate (percent) 7–1–19 i2 * For plans with a valuation date 309 i1 Appendix C to Part 4022—Lump Sum Interest Rates for Private-Sector Payments * Rate set Deferred annuities (percent) it for t = * 0.0292 1–25 it * for t = * 0.0307 Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 and the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. DATES: Effective: June 14, 2019. FOR FURTHER INFORMATION CONTACT: OFAC: Assistant Director for Licensing, 202–622–2480; Assistant Director for Regulatory Affairs, 202–622–4855; Assistant Director for Sanctions Compliance & Evaluation, 202–622– 2490; or the Department of the Treasury’s Office of the Chief Counsel (Foreign Assets Control), Office of the General Counsel, 202–622–2410. SUPPLEMENTARY INFORMATION: Electronic Availability This document and additional information concerning OFAC are available from OFAC’s website (www.treasury.gov/ofac). Background Section 4 of the Federal Civil Penalties Inflation Adjustment Act (1990 Pub. L. 101–410, 104 Stat. 890; 28 U.S.C. 2461 note), as amended by the PO 00000 Frm 00012 Fmt 4700 Sfmt 4700 it * >25 for t = * N/A N/A Debt Collection Improvement Act of 1996 (Pub. L. 104–134, 110 Stat. 1321– 373) and the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Pub. L. 114–74, 129 Stat. 599, 28 U.S.C. 2461 note) (collectively, the FCPIA Act), requires each federal agency with statutory authority to assess civil monetary penalties (CMPs) to adjust CMPs annually for inflation according to a formula described in section 5 of the FCPIA Act. One purpose of the FCPIA Act is to ensure that CMPs continue to maintain their deterrent effect through periodic cost-of-living based adjustments. OFAC has adjusted its CMPs three times since the Federal Civil Penalties Inflation Adjustment Act Improvements Act went into effect on November 2, 2015: An initial catch-up adjustment on August 1, 2016 (81 FR 43070, July 1, 2016), and annual adjustments on February 10, 2017 (82 FR 10434, February 10, 2017), and March 19, 2018 (83 FR 11876, March 19, 2018). E:\FR\FM\14JNR1.SGM 14JNR1

Agencies

[Federal Register Volume 84, Number 115 (Friday, June 14, 2019)]
[Rules and Regulations]
[Pages 27713-27714]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-12455]


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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 certain interest assumptions under the benefit payments 
regulation for plans with valuation dates in July 2019 and interest 
assumptions under the asset allocation regulation for plans with 
valuation dates in the third quarter of 2019. These interest 
assumptions are used for valuing benefits and paying certain benefits 
under terminating single-employer plans covered by the pension 
insurance system administered by PBGC.

DATES: Effective July 1, 2019.

FOR FURTHER INFORMATION CONTACT: Gregory Katz ([email protected]), 
Attorney, Regulatory Affairs Division, Pension Benefit Guaranty 
Corporation, 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 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 (ERISA). The 
interest assumptions in the regulations are also published on PBGC's 
website (https://www.pbgc.gov).

Lump Sum Interest Assumption

    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 as 
a lump sum. 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 July 2019 measurement dates.
    The July 2019 lump sum interest assumptions will be 0.75 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 June 2019, these assumptions represent a decrease of 0.25 
percent in the immediate rate and are otherwise unchanged.

Valuation/Asset Allocation Interest Assumptions

    PBGC uses the interest assumptions in appendix B to part 4044 
(``Interest Rates Used to Value Benefits'') to value benefits for 
allocation purposes under section 4044 of ERISA, and some private-
sector pension plans use them to determine benefit liabilities 
reportable under section 4044 of ERISA and for other purposes. The 
third quarter 2019 interest assumptions will be 2.92 percent for the 
first 25 years following the valuation date and 3.07 percent 
thereafter. In comparison with the interest assumptions in effect for 
the second quarter of 2019, these interest assumptions represent an 
increase of five years in the select period (the period during which 
the select rate (the initial rate) applies), a decrease of 0.15 percent 
in the select rate, and an increase of 0.02 percent in the ultimate 
rate (the final rate).

Need for Immediate Guidance

    PBGC updates appendix B of the asset allocation regulation each 
quarter and appendices B and C of the benefit payments regulation 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 to value benefits and, for plans that rely 
on our publication of them each month or each quarter, to calculate 
lump sum benefit amounts.
    Because of the need to provide immediate guidance for the valuation 
and payment of benefits under plans with valuation dates during July 
2019, 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 consideration 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 309 is added at the end of the 
table to read as follows:

Appendix B to Part 4022--Lump Sum Interest Rates for PBGC Payments

* * * * *

[[Page 27714]]



--------------------------------------------------------------------------------------------------------------------------------------------------------
                                          For plans with a valuation    Immediate                       Deferred annuities (percent)
                                                     date                annuity   ---------------------------------------------------------------------
                Rate set                 ----------------------------     rate
                                           On or after     Before       (percent)         i             i             i             n             n
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
309.....................................       7-1-19        8-1-19          0.75          4.00          4.00          4.00             7             8
--------------------------------------------------------------------------------------------------------------------------------------------------------


0
3. In appendix C to part 4022, Rate Set 309 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                                    Deferred annuities (percent)
                                                     date               Immediate  ---------------------------------------------------------------------
                Rate set                 ---------------------------- annuity rate
                                           On or after     Before       (percent)         i             i             i             n             n
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
309.....................................       7-1-19        8-1-19          0.75          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, an entry for ``July-September 2019'' is 
added at the end of the table to read as follows:

Appendix B to Part 4044--Interest Rates Used to Value Benefits

* * * * *

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            The values of i are:
   For valuation dates occurring in the month--    -----------------------------------------------------------------------------------------------------
                                                           i             for t =             i             for t =             i             for t =
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
July-September 2019...............................          0.0292             1-25           0.0307              >25              N/A              N/A
--------------------------------------------------------------------------------------------------------------------------------------------------------


    Issued in Washington, DC.
Hilary Duke,
Assistant General Counsel, Pension Benefit Guaranty Corporation.
[FR Doc. 2019-12455 Filed 6-13-19; 8:45 am]
 BILLING CODE 7709-02-P