36702 Federal Register / Vol. 66, No. 135 / Friday, July 13, 2001 / Rules and Regulations

PENSION BENEFIT GUARANTY

CORPORATION

29 CFR Parts 4022 and 4044

Benefits Payable in Terminated SingleEmployer Plans; Allocation of Assets

in Single-Employer Plans; Interest

Assumptions for Valuing and Paying

Benefits

AGENCY: Pension Benefit Guaranty

Corporation.

ACTION: Final rule.

SUMMARY: The Pension Benefit Guaranty

Corporation’s regulations on Benefits

Payable in Terminated Single-Employer

Plans and Allocation of Assets in

Single-Employer Plans prescribe interest

assumptions for valuing and paying

benefits under terminating singleemployer plans. This final rule amends

the regulations to adopt interest

assumptions for plans with valuation

dates in August 2001. Interest

assumptions are also published on the

PBGC’s Web site (http://www.pbgc.gov).

EFFECTIVE DATE: August 1, 2001.

FOR FURTHER INFORMATION CONTACT:

Harold J. Ashner, Assistant General

Counsel, Office of the General Counsel,

Pension Benefit Guaranty Corporation,

1200 K Street, NW., Washington, DC

20005, 202–326–4024. (For TTY/TDD

users, call the Federal relay service tollfree at 1–800–877–8339 and ask to be

connected to 202–326–4024.)

SUPPLEMENTARY INFORMATION: The

PBGC’s regulations prescribe actuarial

assumptions—including interest

assumptions—for valuing and paying

plan benefits of terminating singleemployer plans covered by title IV of

the Employee Retirement Income

Security Act of 1974. The interest

assumptions are intended to reflect

current conditions in the financial and

annuity markets.

Three sets of interest assumptions are

prescribed: (1) A set for the valuation of

benefits for allocation purposes under

section 4044 (found in Appendix B to

Part 4044), (2) a set for the PBGC to use

to determine whether a benefit is

payable as a lump sum and to determine

lump-sum amounts to be paid by the

PBGC (found in Appendix B to Part

4022), and (3) a set for private-sector

pension practitioners to refer to if they

wish to use lump-sum interest rates

determined using the PBGC’s historical

methodology (found in Appendix C to

Part 4022).

Accordingly, this amendment (1)

Adds to Appendix B to Part 4044 the

interest assumptions for valuing benefits

for allocation purposes in plans with

valuation dates during August 2001, (2)

adds to Appendix B to Part 4022 the

interest assumptions for the PBGC to

use for its own lump-sum payments in

plans with valuation dates during

August 2001, and (3) adds to Appendix

C to Part 4022 the interest assumptions

for private-sector pension practitioners

to refer to if they wish to use lump-sum

interest rates determined using the

PBGC’s historical methodology for

valuation dates during August 2001.

For valuation of benefits for allocation

purposes, the interest assumptions that

the PBGC will use (set forth in

Appendix B to part 4044) will be 6.40

percent for the first 20 years following

the valuation date and 6.25 percent

thereafter. These interest assumptions

represent a decrease (from those in

effect for July 2001) of 0.20 percent for

the first 20 years following the valuation

date and are otherwise unchanged.

The interest assumptions that the

PBGC will use for its own lump-sum

payments (set forth in Appendix B to

part 4022) will be 4.75 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. These interest

assumptions represent a decrease (from

those in effect for July 2001) of 0.25

percent for the period during which a

benefit is in pay status and the sevenyear period directly preceding the

benefit’s placement in pay status; they

are otherwise unchanged.

For private-sector payments, the

interest assumptions (set forth in

Appendix C to part 4022) will be the

same as those used by the PBGC for

determining and paying lump sums (set

forth in Appendix B to part 4022).

The 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, as

accurately as possible, current market

conditions.

Because of the need to provide

immediate guidance for the valuation

and payment of benefits in plans with

valuation dates during August 2001, the

PBGC finds that good cause exists for

making the assumptions set forth in this

amendment effective less than 30 days

after publication.

The 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

94, as set forth below, is added to the

table. (The introductory text of the table

is omitted.)

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

* * * * * * *

Rate set

For plans with a valuation

date Immediate

annuity rate

(percent)

Deferred annuities (percent)

On or after Before i1 i2 i3 n1 n2

*******

94 8–1–01 9–1–01 4.75 4.00 4.00 4.00 7 8

Federal Register / Vol. 66, No. 135 / Friday, July 13, 2001 / Rules and Regulations 36703

3. In appendix C to part 4022, Rate Set 94, as set forth below, is added to the table. (The introductory text

of the table is omitted.)

Appendix C to Part 4022—Lump Sum Interest Rates for Private-Sector Payments

* * * * * * *

Rate set

For plans with a valuation

date Immediate

annuity rate

(percent)

Deferred annuities (percent)

On or after Before i1 i2 i3 n1 n2

*******

94 8–1–01 9–1–01 4.75 4.00 4.00 4.00 7 8

PART 4044—ALLOCATION OF

ASSETS IN SINGLE-EMPLOYER

PLANS

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.

5. In appendix B to part 4044, a new

entry, as set forth below, is added to the

table. (The introductory text of the table

is omitted.)

Appendix B to Part 4044—Interest

Rates Used to Value Benefits

* * * * *

For valuation dates occurring in the month—

The values of it are:

it for t = it for t = it for t =

*******

August 2001 .......................................................................... .0640 1–20 .0625 >20 N/A N/A

Issued in Washington, DC, on this 10th day

of July 2001.

John Seal,

Acting Executive Director, Pension Benefit

Guaranty Corporation.

[FR Doc. 01–17574 Filed 7–12–01; 8:45 am]

BILLING CODE 7708–01–P

DEPARTMENT OF THE TREASURY

31 CFR Part 29

Federal Benefit Payments Under

Certain District of Columbia

Retirement Plans

AGENCY: Departmental Offices,

Department of the Treasury.

ACTION: Interim rule with request for

comments.

SUMMARY: The Department of the

Treasury, Departmental Offices, is

issuing an interim rule and requesting

comments on this rule, which

implements the provisions of the

Balanced Budget Act of 1997, as

amended (Act). The Act assigns the

Secretary of the Treasury responsibility

for payment of benefits (hereafter,

Federal Benefit Payments) under the

District of Columbia (District) retirement

plans for police officers and firefighters,

and teachers for benefits based on credit

for service accrued as of June 30, 1997,

and under the District retirement plan

for judges. The interim rule establishes

the general rules for the Treasury

Department’s processes for (1) debt

collections arising from overpayments

of Federal Benefit Payments or debt

claims by Federal agencies, and (2)

waiver of recovery of overpaid benefits

or amounts otherwise owed to the

retirement plans.

DATES: Interim rule effective August 13,

2001; comments must be received on or

before September 11, 2001.

ADDRESSES: Send comments to Ronald

A. Glaser, Director, Office of Personnel

Policy, Department of the Treasury,

Metropolitan Square Building, Room

6075, 15th Street and Pennsylvania

Avenue, NW, Washington, DC 20220.

Comments may also be submitted by

electronic mail to

dcpensions@do.treas.gov.

FOR ADDITIONAL INFORMATION CONTACT:

Harold L. Siegelman, (202) 622–1540,

Department of the Treasury,

Metropolitan Square Building, Room

6033, 15th Street and Pennsylvania

Avenues, NW, Washington, DC 20220.

SUPPLEMENTARY INFORMATION: Title XI of

the Balanced Budget Act of 1997, Public

Law 105–33, 111 Stat. 251, 712–731,

756–759, enacted August 5, 1997, as

amended by the Omnibus Consolidated

and Emergency Supplemental

Appropriations Act for Fiscal Year 1999,

Public Law 105–277, 112 Stat. 2681,

2681–530 through 538, 2681–552, and

as further amended by the Consolidated

Appropriations Act of 2001, Public Law

106–554, 114 Stat. 2763, transferred

certain unfunded pension liabilities

from the District government to the

Federal Government. The Act requires

the Federal Government to assume

responsibility for payment of certain

benefits that accrued on or before June

30, 1997, under the retirement plans for

District teachers (Teachers Plan) and

police officers and firefighters (Police

Officers and Firefighters Plan) as they

existed on June 29, 1997, and for past

and future benefits under the retirement

plan for judges (Judges Plan)

(collectively, the Retirement Funds).

The Act also required the District

government to establish replacement

retirement plans that will provide

retirement benefits for service after June

30, 1997, for current and future

teachers, police, and firefighters.

The Office of D.C. Pensions developed

the interim rule in consultation with the

Department of the Treasury’s Financial

Management Service and acknowledges

its constructive assistance.

1. Requirement to establish processes

for debt collection and waivers of debt

collection. The interim rule implements

section 11021(3) of the Act (codified at

D.C. Code Ann. 1–763.1) and section

11251 (c)(2)(B) of the Act (amending

D.C. Code Ann. 11–1570). These statutes

provide for the collection of, or waiver

of collection of, overpayments of

Federal Benefit Payments.

The interim rule is based in part on

the Office of Personnel Management

(OPM) regulations with respect to