[Federal Register Volume 75, Number 219 (Monday, November 15, 2010)]
[Rules and Regulations]
[Pages 69588-69589]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-28570]


=======================================================================
-----------------------------------------------------------------------

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.

-----------------------------------------------------------------------

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 December 2010. Interest assumptions are also published on PBGC's Web 
site (http://www.pbgc.gov).

DATES: Effective December 1, 2010.

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 December 2010.\1\
---------------------------------------------------------------------------

    \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.
---------------------------------------------------------------------------

    The December 2010 interest assumptions under the benefit payments 
regulation will be 2.25 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 November 2010, these interest assumptions 
represent an increase of 0.50 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 December 2010, 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''

[[Page 69589]]

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 4022

    Employee benefit plans, Pension insurance, Pensions, Reporting and 
recordkeeping requirements.

0
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 206, 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)           i 1              i 2              i 3              n 1              n 2
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
          206           12-1-10           1-1-11             2.25             4.00             4.00             4.00                7                8
--------------------------------------------------------------------------------------------------------------------------------------------------------


0
3. In appendix C to part 4022, Rate Set 206, 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)           i 1              i 2              i 3              n 1              n 2
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
          206           12-1-10           1-1-11             2.25             4.00             4.00             4.00                7                8
--------------------------------------------------------------------------------------------------------------------------------------------------------


    Issued in Washington, DC, on November 8, 2010.
Vincent K. Snowbarger,
Deputy Director for Operations, Pension Benefit Guaranty Corporation.
[FR Doc. 2010-28570 Filed 11-12-10; 8:45 am]
BILLING CODE 7709-01-P