Allocation of Assets in Single-Employer Plans; Interest Assumptions for Valuing Benefits, 62706 [2023-19803]

Agencies

• Pension Benefit Guaranty Corporation

[Federal Register Volume 88, Number 176 (Wednesday, September 13, 2023)]
[Rules and Regulations]
[Page 62706]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-19803]


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PENSION BENEFIT GUARANTY CORPORATION

29 CFR Part 4044


Allocation of Assets in Single-Employer Plans; Interest 
Assumptions for Valuing 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 Allocation of Assets in Single-Employer 
Plans to prescribe interest assumptions under the asset allocation 
regulation for plans with valuation dates in the fourth quarter of 
2023. These interest assumptions are used for valuing benefits under 
terminating single-employer plans and for other purposes.

DATES: Effective October 1, 2023.

FOR FURTHER INFORMATION CONTACT: Gregory Katz ([email protected]), 
Attorney, Office of the General Counsel, Pension Benefit Guaranty 
Corporation, 445 12th Street SW, Washington, DC 20024-2101, 202-229-
3829. If you are deaf or hard of hearing, or have a speech disability, 
please dial 7-1-1 to access telecommunications relay services.

SUPPLEMENTARY INFORMATION: PBGC's regulation on Allocation of Assets in 
Single-Employer Plans (29 CFR part 4044) prescribes actuarial 
assumptions--including interest assumptions--for valuing 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 regulation are also published on PBGC's website 
(https://www.pbgc.gov).
    PBGC uses the interest assumptions in appendix B to part 4044 
(``Interest Rates Used to Value Benefits'') to determine the present 
value of annuities in an involuntary or distress termination of a 
single-employer plan under the asset allocation regulation. The 
assumptions are also used to determine the value of multiemployer plan 
benefits and certain assets when a plan terminates by mass withdrawal 
in accordance with PBGC's regulation on Duties of Plan Sponsor 
Following Mass Withdrawal (29 CFR part 4281).
    The fourth quarter 2023 interest assumptions will be 5.06 percent 
for the first 20 years following the valuation date and 4.37 percent 
thereafter. In comparison with the interest assumptions in effect for 
the third quarter of 2023, these interest assumptions represent no 
change in the select period (the period during which the select rate 
(the initial rate) applies), a decrease of 0.18 percent in the select 
rate, and a decrease of 0.21 percent in the ultimate rate (the final 
rate).

Need for Immediate Guidance

    PBGC has determined that notice of, and public comment on, this 
rule are impracticable, unnecessary, and contrary to the public 
interest. PBGC routinely updates the interest assumptions in appendix B 
of the asset allocation regulation each quarter so that they are 
available to value benefits. Accordingly, PBGC finds that the public 
interest is best served by issuing this rule expeditiously, without an 
opportunity for notice and comment, and that good cause exists for 
making the assumptions set forth in this amendment effective less than 
30 days after publication to allow the use of the proper assumptions to 
estimate the value of plan benefits for plans with valuation dates 
early in the fourth quarter of 2023.
    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 4044

    Employee benefit plans, Pension insurance, Pensions.

    In consideration of the foregoing, 29 CFR part 4044 is amended as 
follows:

PART 4044--ALLOCATION OF ASSETS IN SINGLE-EMPLOYER PLANS

0
1. 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
2. In appendix B to part 4044, an entry for ``October-December 2023'' 
is added at the end of the table to read as follows:

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

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                                                             The values of i are:
     For valuation dates     -----------------------------------------------------------------------------------
  occurring in the month--          i          for t =          i          for t =          i          for t =
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                                                  * * * * * * *
October-December 2023.......       0.0506          1-20        0.0437           >20           N/A           N/A
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    Issued in Washington, DC.
Hilary Duke,
Assistant General Counsel for Regulatory Affairs, Pension Benefit 
Guaranty Corporation.
[FR Doc. 2023-19803 Filed 9-12-23; 8:45 am]
BILLING CODE 7709-02-P