[Federal Register Volume 71, Number 158 (Wednesday, August 16, 2006)]
[Notices]
[Page 47260]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-6959]


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PENSION BENEFIT GUARANTY CORPORATION


Required Interest Rate Assumption for Determining Variable-Rate 
Premium for Single-Employer Plans; Interest Assumptions for 
Multiemployer Plan Valuations Following Mass Withdrawal

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Notice of interest rates and assumptions.

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SUMMARY: This notice informs the public of the interest rates and 
assumptions to be used under certain Pension Benefit Guaranty 
Corporation regulations. These rates and assumptions are published 
elsewhere (or can be derived from rates published elsewhere), but are 
collected and published in this notice for the convenience of the 
public. Interest rates are also published on the PBGC's Web site 
(http://www.pbgc.gov).

DATES: The required interest rate for determining the variable-rate 
premium under part 4006 applies to premium payment years beginning in 
August 2006. The interest assumptions for performing multiemployer plan 
valuations following mass withdrawal under part 4281 apply to valuation 
dates occurring in September 2006.

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:

Variable-Rate Premiums

    Section 4006(a)(3)(E)(iii)(II) of the Employee Retirement Income 
Security Act of 1974 (ERISA) and Sec.  4006.4(b)(1) of the PBGC's 
regulation on Premium Rates (29 CFR part 4006) prescribe use of an 
assumed interest rate (the ``required interest rate'') in determining a 
single-employer plan's variable-rate premium. The required interest 
rate is the ``applicable percentage'' (currently 85 percent) of the 
annual yield on 30-year Treasury securities for the month preceding the 
beginning of the plan year for which premiums are being paid (the 
``premium payment year''). The required interest rate to be used in 
determining variable-rate premiums for premium payment years beginning 
in August 2006 is 4.36 percent (i.e., 85 percent of the 5.13 percent 
Treasury Securities Rate for July 2006).
    The Pension Funding Equity Act of 2004 (``PFEA'')--under which the 
required interest rate is 85 percent of the annual rate of interest 
determined by the Secretary of the Treasury on amounts invested 
conservatively in long-term investment grade corporate bonds for the 
month preceding the beginning of the plan year for which premiums are 
being paid--applies only for premium payment years beginning in 2004 or 
2005. Congress has passed legislation that would extend the PFEA rate 
for two more years. When that legislation is signed into law, the PBGC 
will promptly publish a Federal Register notice with the rate for 
August 2006, as well as the rates for January through July 2006.
    The following table lists the required interest rates to be used in 
determining variable-rate premiums for premium payment years beginning 
between September 2005 and August 2006.

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                                                           The required
         For premium payment years beginning in:           interest rate
                                                                is:
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September 2005..........................................            4.61
October 2005............................................            4.62
November 2005...........................................            4.83
December 2005...........................................            4.91
January 2006............................................            3.95
February 2006...........................................            3.90
March 2006..............................................            3.89
April 2006..............................................            4.02
May 2006................................................            4.30
June 2006...............................................            4.42
July 2006...............................................            4.39
August 2006.............................................            4.36
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Multiemployer Plan Valuations Following Mass Withdrawal

    The PBGC's regulation on Duties of Plan Sponsor Following Mass 
Withdrawal (29 CFR part 4281) prescribes the use of interest 
assumptions under the PBGC's regulation on Allocation of Assets in 
Single-Employer Plans (29 CFR part 4044). The interest assumptions 
applicable to valuation dates in September 2006 under part 4044 are 
contained in an amendment to part 4044 published elsewhere in today's 
Federal Register. Tables showing the assumptions applicable to prior 
periods are codified in appendix B to 29 CFR part 4044.

    Issued in Washington, DC, on this 8th day of August 2006.
Vincent K. Snowbarger,
Acting Executive Director, Pension Benefit Guaranty Corporation.
[FR Doc. 06-6959 Filed 8-15-06; 8:45 am]
BILLING CODE 7709-01-P