[Federal Register Volume 88, Number 214 (Tuesday, November 7, 2023)]
[Rules and Regulations]
[Pages 76660-76665]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-24268]


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PENSION BENEFIT GUARANTY CORPORATION

29 CFR Parts 4000, 4003, 4006, 4010, 4022, 4041A, 4043, 4211, and 
4262

RIN 1212-AB56


Technical Amendments: Special Financial Assistance Withdrawal 
Liability Condition; SECURE 2.0 Act; and Other Updates

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Final rule.

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SUMMARY: The Pension Benefit Guaranty Corporation (PBGC) is making 
miscellaneous technical updates, clarifications, and corrections to 
PBGC's regulations, including to clarify a special financial assistance 
withdrawal liability condition and to update the reference to the 
dollar limit for lump-sum distributions in the closeout of sufficient 
multiemployer plans to reflect changes implemented under the SECURE 2.0 
Act of 2022.

DATES: This rule is effective on December 7, 2023.

FOR FURTHER INFORMATION CONTACT: Hilary Duke (<a href="/cdn-cgi/l/email-protection#086c7d636d26606164697a7148786a6f6b266f677e"><span class="__cf_email__" data-cfemail="9afeeff1ffb4f2f3f6fbe8e3daeaf8fdf9b4fdf5ec">[email protected]</span></a>; 
202-229-3839), Assistant General Counsel for Regulatory Affairs, or 
Melissa Rifkin (<a href="/cdn-cgi/l/email-protection#f88a919e939196d6959d94918b8b99b8889a9f9bd69f978e"><span class="__cf_email__" data-cfemail="2c5e454a47454202414940455f5f4d6c5c4e4b4f024b435a">[email protected]</span></a>; 202-229-6563), Attorney, 
Regulatory Affairs Division; Office of the General Counsel, Pension 
Benefit Guaranty Corporation, 445 12th Street SW, Washington, DC 20024-
2101. 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: 

Executive Summary

Purpose and Authority

    This final rule makes technical corrections, updates, and 
clarifications to several Pension Benefit Guaranty Corporation (PBGC) 
regulations.
    PBGC's legal authority for this rulemaking comes from section 
4002(b)(3) of the Employee Retirement Income Security Act of 1974 
(ERISA), which authorizes PBGC to issue regulations to carry out the 
purposes of title IV of ERISA, and section 4262 of ERISA (Special 
Financial Assistance by the Corporation), which permits PBGC, in 
consultation with the Secretary of the Treasury, to impose reasonable 
conditions by regulation or other guidance on an eligible multiemployer 
plan that receives special financial assistance (SFA). It also comes 
from section 4003 of ERISA (Operation of Corporation); section 4006 of 
ERISA (Premium Rates); section 4010 of ERISA (Authority to Require 
Certain Information); section 4022 of ERISA (Single-Employer Plan 
Benefits Guaranteed); section 4041A of ERISA (Termination of 
Multiemployer Plans); section 4043 of ERISA (Reportable Events); and 
section 4211 of ERISA (Methods for Computing Withdrawal Liability).

Major Provisions

    The major provisions of this regulatory action amend PBGC's 
regulations on: (1) Special Financial Assistance by PBGC (29 CFR part 
4262) to clarify the calculation methodology for the condition 
requiring a phased recognition of SFA in a plan's determination of 
withdrawal liability for plans that receive SFA; and (2) Termination of 
Multiemployer Plans (29 CFR part 4041A) to update the reference to the 
dollar limit for lump-sum distributions in the closeout of sufficient 
multiemployer plans (reflecting updated dollar limits for pension plans 
under section 304 of the SECURE 2.0 Act of 2022 (SECURE 2.0)).\1\ In 
addition, this regulatory action makes other clarifications, 
corrections, and updates.
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    \1\ SECURE 2.0 Act of 2022, Division T of the Consolidated 
Appropriations Act, 2023, Public Law 117-328 (Dec. 29, 2022).

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[[Page 76661]]

Background

    PBGC administers two insurance programs for private-sector defined 
benefit pension plans under title IV of ERISA: a single-employer plan 
termination insurance program and a multiemployer plan insolvency 
insurance program. In addition, PBGC administers an SFA program for 
eligible financially distressed multiemployer plans. The primary 
amendments in this rulemaking apply to the SFA program.
    This rulemaking responds to questions from stakeholders requesting 
clarification of the calculation methodology for the condition imposed 
on plans that receive SFA requiring a phased recognition of SFA in the 
determination of withdrawal liability. It also arises from statutory 
changes and from PBGC's ongoing retrospective regulatory review program 
to identify and correct inaccuracies, inconsistencies, and requirements 
made irrelevant over time.

Clarifications to SFA Program Withdrawal Liability Condition

Background

    Under section 4262 of ERISA and PBGC's SFA regulation, PBGC 
provides SFA to certain financially troubled multiemployer plans upon 
application for assistance. To ensure that SFA is used to pay benefits 
and the expenses related to those benefit payments, section 4262(m)(1) 
of ERISA expressly authorizes PBGC, in consultation with the Secretary 
of the Treasury, to impose reasonable conditions on an eligible 
multiemployer plan that receives SFA relating to certain aspects of 
plan terms or operations. These conditions are described in Sec.  
4262.16 of PBGC's SFA regulation and include conditions that relate to 
withdrawal liability.\2\
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    \2\ Withdrawal liability represents a withdrawing employer's 
proportionate share of the plan's unfunded benefit obligations and 
is an important source of income for the plan. To assess withdrawal 
liability, the plan sponsor must determine the withdrawing 
employer's: (1) allocable share of the plan's unfunded vested 
benefits (UVBs) (the value of nonforfeitable benefits that exceeds 
the value of plan assets) as of the end of the plan year before the 
employer's withdrawal, or as otherwise provided under section 4211 
of ERISA, and (2) annual withdrawal liability payment and 
amortization period under section 4219.
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    On July 8, 2022, PBGC published a final rule \3\ (July 2022 final 
rule) adding a condition requiring a phased recognition of SFA in a 
plan's determination of withdrawal liability. PBGC provided for a 30-
day comment period solely on this condition. In response to comments 
received, PBGC published, on January 26, 2023, a final rule \4\ 
(January 2023 final rule) which provided a process for a plan sponsor 
to request approval from PBGC for an exception from the withdrawal 
liability conditions in Sec.  4262.16(g)(1) and (2) under specific 
circumstances.
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    \3\ See 87 FR 40968. PBGC published the July 2022 final rule in 
response to comments received on an interim final rule, which was 
published in the Federal Register on July 12, 2021, at 86 FR 36598.
    \4\ See 88 FR 4900.
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    Following publication of the January 2023 final rule, PBGC received 
practitioner questions at public forums related to the withdrawal 
liability phase-in condition and make-up payments of previously 
suspended benefits. To address these questions, on July 19, 2023, PBGC 
posted guidance on its website at www.pbgc.gov, in the form of 
questions and answers, on the withdrawal liability phase-in condition. 
That guidance clarifies the calculation methodology for the phased 
recognition of SFA assets for plans that paid make-up payments of 
previously suspended benefits.

Clarification of Calculation Methodology for Withdrawal Liability 
Phase-In Condition

    The withdrawal liability condition in Sec.  4262.16(g)(2) requires 
a phased recognition of SFA assets, i.e., SFA and earnings thereon, for 
the purpose of determining the plan's unfunded vested benefits (UVBs) 
for calculating withdrawal liability, and provides the calculation 
methodology for determining the amount of SFA that is phased in for 
withdrawal liability purposes each year over the projected life of the 
SFA assets (determined as if SFA assets are exhausted before other plan 
assets are used to pay benefits and expenses). The applicable phase-in 
period runs from the first plan year in which the plan receives payment 
of SFA through the end of the plan year by which, according to the 
plan's projections, it will exhaust any SFA assets.\5\
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    \5\ For a plan that receives payment of SFA under the terms of 
the interim final rule and then files a supplemented application, 
the first plan year of payment is the year in which it received SFA 
under the terms of the interim final rule. Where a plan's first plan 
year of payment is not the plan year that includes the plan's SFA 
measurement date, the exhaustion year is deferred by the number of 
years the first plan year of payment is after the plan year that 
includes the SFA measurement date.
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    To calculate the amount of SFA assets excluded for each plan year 
during the phase-in period, the plan must take the total amount of SFA 
paid to the plan (not including the amount paid to PBGC for repayment 
of traditional financial assistance) and multiply that by a fraction, 
the numerator of which is the number of years remaining in the phase-in 
period as of the date (the end of the determination year) that the UVBs 
are being determined, and the denominator is the total number of years 
in the phase-in period.\6\
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    \6\ For a plan that receives payment of SFA under the interim 
final rule and receives a supplemental payment, the total amount 
(payment under the interim final rule and supplemental payment) will 
be included in the phased recognition of SFA assets in determining 
UVBs for withdrawals occurring in plan years after the plan year the 
supplemental payment is received by the plan. For withdrawals that 
occur after the date the supplemented application is filed and 
before the plan year after the plan year in which the supplemental 
payment is made, only the payment of SFA under the interim final 
rule is included in the phased recognition of SFA assets.
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    Examples are included in Sec.  4262.16(g)(2) to illustrate the 
calculation methodology for the phased recognition of SFA assets.
    Section 4262(k) of ERISA and Sec.  4262.15 require that benefits 
suspended under sections 305(e)(9) or 4245(a) of ERISA must be 
reinstated and make-up payments of previously suspended benefits must 
be paid to certain participants and beneficiaries. Plans must pay these 
make-up payments either as a lump sum within 3 months of the date SFA 
is paid, or in equal monthly installments over 5 years, starting within 
3 months of the SFA payment date.
    As stated in PBGC's guidance posted July 19, 2023, the phased 
recognition of SFA assets for purposes of calculating employer 
withdrawal liability was intended to approximate the pattern of how the 
SFA assets are likely to be spent down by a plan. Therefore, in the 
calculation under Sec.  4262.16(g)(2)(ix), the amount of the SFA 
attributable to the make-up payments that have already been paid to 
participants and beneficiaries should be excluded from the ``total 
amount of SFA paid to the plan under Sec.  4262.12'' before 
multiplication by the phase-in fraction. The result is the amount under 
Sec.  4262.16(g)(2)(ix) by which the value of plan assets used to 
determine UVBs for the determination year is reduced under Sec.  
4262.16(g)(2)(viii). This calculation methodology applies regardless of 
whether the make-up payments are made in a lump sum or in equal monthly 
installments over 5 years, and regardless of whether such payments are 
made from SFA assets or non-SFA assets, or some combination thereof.
    Accordingly, this final rule incorporates the guidance posted on 
July 19, 2023, and amends Sec.  4262.16(g)(2)(ix) to reorganize the 
existing provisions as paragraph (g)(2)(ix)(A) and to add new paragraph 
(g)(2)(ix)(B) to clarify how plan assets expended on make-up payments 
of

[[Page 76662]]

previously suspended benefits are considered in the calculation 
methodology. The amendment also clarifies how the repayment of 
traditional financial assistance is considered in the calculation 
methodology. In addition, this final rule adds the example from the 
July 19, 2023, guidance to Sec.  4262.16(g)(2)(xvi)(D).
    PBGC also received practitioner questions asking whether the 
calculation of SFA excluded under Sec.  4262.16(g)(2)(viii) could 
reduce the value of plan assets for determining UVBs to less than zero. 
In response, PBGC included in the July 19, 2023, guidance, a provision, 
applicable to all plans that receive SFA (regardless of whether they 
are required to pay make-up payments), stating that the value of the 
plan assets taken into account as of the end of a determination year 
under Sec.  4262.16(g)(2)(viii) used for purposes of determining UVBs 
may not be less than zero. This clarification is added in Sec.  
4262.16(g)(2)(viii) of the SFA regulation.

Clarifications and Corrections to Multiemployer Plan Regulations

Termination of Multiemployer Plans--29 CFR part 4041A

    PBGC's regulation on Termination of Multiemployer Plans (29 CFR 
part 4041A) contains rules for the administration of multiemployer 
plans that have terminated by mass withdrawal. Subpart D contains 
procedures for closing out a plan where a plan's assets, excluding any 
claim of the plan for unpaid withdrawal liability, are sufficient to 
satisfy all obligations for nonforfeitable benefits provided under the 
plan. In the case of such a plan, the plan sponsor may close out the 
plan by distributing plan assets in full satisfaction of all 
nonforfeitable benefits under the plan. Section 4041A.43 provides rules 
for the payment of nonforfeitable benefits to participants and 
beneficiaries, including for lump-sum distributions.
    Section 203(e)(1) of ERISA and section 411(a)(11)(A) of the 
Internal Revenue Code provide a threshold (i.e., maximum present value 
of a benefit) that a pension plan may pay in a mandatory lump-sum 
distribution. From 1997 through 2023, that maximum was $5,000.\7\ After 
2023, it will be $7,000, as changed by section 304 of SECURE 2.0.
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    \7\ The Taxpayer Relief Act of 1997, Public Law 105-34 (Aug. 5, 
1997), increased the maximum from $3,500 to $5,000 effective for 
plan years beginning after August 5, 1997.
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    Before the amendment provided by this final rule, Sec.  
4041A.43(b)(1) provided the dollar figure of $5,000 as the dollar 
threshold up to which the plan sponsor of a terminated multiemployer 
plan that is closing out may make as a lump-sum payment of 
nonforfeitable benefits. To avoid amending the regulation each time 
Congress changes the threshold for mandatory lump-sum distributions, 
the final rule amends Sec.  4041A.43(b)(1) to refer not to a set 
monetary figure, but to the dollar amount specified in section 
203(e)(1) of ERISA. As a result, for purposes of part 4041A, the new 
$7,000 maximum automatically will apply to the lump-sum payment of 
nonforfeitable benefits after December 31, 2023.

Allocating Unfunded Vested Benefits to Withdrawing Employers--29 CFR 
Part 4211

    Under the Allocating Unfunded Vested Benefits to Withdrawing 
Employers regulation (29 CFR part 4211), PBGC is amending Sec.  
4211.31(b) by adding the words ``set forth in'' that were inadvertently 
omitted in a prior rule.\8\ The final sentence of paragraph (b) is 
corrected to read, ``the statutory presumptive method set forth in 
subpart B of this part.''
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    \8\ See 86 FR 1256.
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Other Clarifications, Corrections, and Updates

Filing Rules--29 CFR Part 4000

    Under PBGC's Filing, Issuance, Computation of Time, and Record 
Retention regulation (29 CFR part 4000), PBGC is modifying Sec.  
4000.4--Where do I file my submission? to update the reference to the 
telecommunications system for individuals who are deaf or hard of 
hearing or have a speech disability. PBGC is changing the reference 
from the ``Federal relay service'' to the ``7-1-1'' number, which is 
the system currently used by PBGC for access to telecommunications 
relay services.
    PBGC is removing and reserving Sec.  4000.28--What if I send a 
computer disk? which gives instructions for providing filings on a 
computer disk. Technological advancements have made this section 
obsolete.

Rules for Administrative Review of Agency Decisions--29 CFR Part 4003

    Under PBGC's Rules for Administrative Review of Agency Decisions 
regulation (29 CFR part 4003), PBGC is changing Sec.  4003.35--Decision 
on request for reconsideration, by removing the word ``final'' from the 
phrase ``final decision'' in paragraph (a). In a prior rule,\9\ the 
word ``final'' was removed from other usages of the phrase ``final 
decision'' in Sec.  4003.35. In addition, PBGC is changing the wording 
``request for reconsideration'' to ``a request for reconsideration'' in 
paragraph (a)(1) to be consistent with the wording in paragraph (a)(2).
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    \9\ See 85 FR 10279.
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Premium Rates--29 CFR Part 4006

    PBGC is modifying the Premium Rates regulation (29 CFR part 4006) 
in Sec.  4006.3--Premium rate, and Sec.  4006.5--Exemptions and special 
rules. Section 4006.3(a) contains references to sections 4006(a)(3)(F) 
and 4006(a)(3)(H) of ERISA. Both statutory provisions affected the 
calculation of flat rate premiums and sunset in 2013.\10\ As these 
provisions are no longer relevant for calculating premiums, PBGC is 
removing them from the premium rates regulation.
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    \10\ Section 4006(a)(3)(F) of ERISA reads, ``For each plan year 
beginning in a calendar year after 2006 and before 2013. . .'' and 
section 4006(a)(3)(H) of ERISA refers to 4006(a)(3)(A)(iv), which 
says, ``in the case of a multiemployer plan, for plan years 
beginning after December 31, 2005, and before January 1, 2013.''
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    Also, PBGC is correcting a citation in Sec.  4006.5(b), which 
covers the variable-rate premium cap. This paragraph references section 
``4006(a)(3)(H) of ERISA,'' which was added to Sec.  4006.5(b) in 2008 
to reference the small employer cap. \11\ Section 4006(a)(3)(H) was 
renumbered as 4006(a)(3)(I) in 2013.\12\ PBGC is changing this citation 
in Sec.  4006.5(b) to ``section 4006(a)(3)(I) of ERISA for certain 
small employers.''
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    \11\ See 73 FR 15065.
    \12\ See section 703 of the Bipartisan Budget Act of 2013, 
Public Law 113-67 (Dec. 26, 2013).
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Annual Financial and Actuarial Information Reporting--29 CFR Part 4010 
and Reportable Events--29 CFR Part 4043

    Under PBGC's regulation on Annual Financial and Actuarial 
Information Reporting (29 CFR part 4010, ``4010 regulation''), PBGC is 
correcting a reference in Sec.  4010.10(b). The reference to ``Sec.  
4010.8(b)(1)'' is changed to ``Sec.  4010.8(b)(2)(i)'' to account for a 
prior reorganization of Sec.  4010.8.\13\
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    \13\ See 81 FR 15432.
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    PBGC is modifying Sec.  4010.13 under PBGC's 4010 regulation and 
Sec.  4043.8 under PBGC's Reportable Events and Certain Other 
Notification Requirements regulation (29 CFR part 4043) to replace 
references to ``Sec.  4901.21(a)(3)'' with references to ``Sec.  
4901.21(a).'' These corrections are to account for changes in a prior 
reorganization of Sec.  4901.21, under PBGC's regulation on Disclosure 
and Public Inspection of Pension

[[Page 76663]]

Benefit Guaranty Corporation Records (29 CFR part 4901).\14\
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    \14\ See 87 FR 43991.
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Benefits Payable in Terminated Single-Employer Plans--29 CFR Part 4022

    Under the Benefits Payable in Terminated Single-Employer Plans 
regulation (29 CFR part 4022), for consistency, PBGC is amending the 
heading for Sec.  4022.7 by changing the words ``single installment'' 
to ``lump sum.'' In a prior rule,\15\ other usages of ``single 
installment'' were changed to ``lump sum'' throughout Sec.  4022.7.
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    \15\ See 88 FR 44045.
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Compliance With Rulemaking Guidelines

Executive Orders 12866 and 13563

    The Office of Management and Budget (OMB) has determined that this 
rule is not a ``significant regulatory action'' under Executive Order 
12866. Accordingly, OMB has not reviewed the final rule under Executive 
Order 12866.
    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, if regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects, distributive impacts, and equity).
    Although this is not a significant regulatory action under 
Executive Order 12866, PBGC has examined the economic and policy 
implications of this final rule and has concluded that there will be no 
significant economic impact as a result of these amendments to PBGC's 
regulations. The regulatory amendments concerning SFA primarily codify 
clarifications already issued by PBGC in sub-regulatory guidance. 
Making these clarifications more transparent will decrease uncertainty 
among plan sponsors in applying the withdrawal liability phase-in 
condition. Without the clarifications, some plan sponsors may not 
accurately account for make-up payments or repaid traditional financial 
assistance when calculating the amount of SFA excluded from plan assets 
for purposes of the condition in the determination of withdrawal 
liability. The amendments concerning lump-sum distributions reflecting 
SECURE 2.0 changes, and the miscellaneous amendments, conform PBGC's 
existing regulations to statutory changes or prior regulatory changes 
or update and clarify outdated regulatory provisions. These amendments 
are cost neutral in their impact.
    Section 6 of Executive Order 13563 requires agencies to rethink 
existing regulations by periodically reviewing their regulatory program 
for rules that ``may be outmoded, ineffective, insufficient, or 
excessively burdensome.'' These rules should be modified, streamlined, 
expanded, or repealed as appropriate. PBGC has identified the 
amendments in this final rule as consistent with the principles for 
review under Executive Order 13563. PBGC believes codifying its 
previously issued guidance provides further clarity to the public, and 
believes that the other amendments will improve and clarify its 
existing regulations.

Administrative Procedure Act

    The Administrative Procedure Act provides at 5 U.S.C. 553(b) that 
notice and comment requirements do not apply when an agency, for good 
cause, finds that they are impracticable, unnecessary, or contrary to 
the public interest.
    With respect to the clarifications to the SFA withdrawal liability 
condition in Sec.  4262.16(g)(2), as described in PBGC's July 2022 
final rule, Congress expressed a clear urgency for PBGC to implement an 
SFA program to get appropriate assistance to eligible plans as quickly 
as possible. Congress authorized PBGC to prioritize the filing of 
applications for eligible plans with the greatest need, during the 
first 2 years after March 11, 2021, and PBGC provided for such a 
process. Plans that suspended benefits under section 4245(a) of ERISA 
have been eligible to apply for SFA since July 12, 2021, and plans that 
suspended benefits under section 305(e)(9) have been eligible to apply 
since December 27, 2021. In 2022, plans began to receive payment of SFA 
and pay required make-up payments. This final rule provides 
clarifications needed by plan sponsors that pay make-up payments that 
will enable them to accurately calculate the amount of SFA excluded 
from plan assets for purposes of the withdrawal liability phase-in 
condition. Recognizing the importance of announcing these 
clarifications promptly, the changes to Sec. Sec.  4262.16(g)(2)(viii), 
(ix), and (xvi)(D) were stated in sub-regulatory guidance. In addition, 
the amendment provides clarification for plans that repaid traditional 
financial assistance to PBGC. Thus, the amendments have the effect of 
increasing clarity of the calculation methodology for plan sponsors and 
employers.
    With respect to the amendment to Sec.  4041A.43(b)(1) in PBGC's 
Termination of Multiemployer Plans regulation, the change conforms the 
regulation to the SECURE 2.0 change to enable certain plans to make 
lump-sum distributions up to the permissible threshold amount of $7,000 
beginning January 1, 2024 (from $5,000). PBGC is authorized under 
section 4041A(f)(1) of ERISA to permit the payment in a lump sum of 
benefits that exceed $1,750. In order to approve these higher 
distributions, PBGC must find that they are not adverse to the 
interests of the plan's participants and beneficiaries generally and do 
not unreasonably increase PBGC's risk of loss with respect to the plan. 
When a plan is being closed out under subpart D of part 4041A, a higher 
distribution threshold would not be adverse to the interests of the 
plan's participants and beneficiaries, since their nonforfeitable 
benefits must be fully satisfied as part of the closeout. This fact 
also ensures that the higher threshold will not unreasonably increase 
PBGC's risk of loss with respect to the plan. In addition, because the 
SECURE 2.0 change applies to distributions after December 31, 2023, 
conforming the regulation without delay will simplify plan 
administration and be in the best interests of participants and 
beneficiaries who may request lump-sum distributions. The other 
amendments in this final rule are minor technical amendments to update 
and correct PBGC's regulations; notice and comment are unnecessary 
because the amendments effect no substantive changes to any regulation.
    Accordingly, PBGC has determined that the amendments in this final 
rule fall under the ``good cause'' exemption of the Administrative 
Procedure Act at 5 U.S.C. 553(b)(3)(B) and that the public interest is 
best served by issuing this final rule expeditiously, without further 
opportunity for notice and comment.

Regulatory Flexibility Act

    Because PBGC is not publishing a general notice of proposed 
rulemaking under 5 U.S.C. 553(b), the regulatory flexibility analysis 
requirements of the Regulatory Flexibility Act do not apply. See 5 
U.S.C. 601(2).

List of Subjects

29 CFR Part 4000

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

29 CFR Part 4003

    Administrative practice and procedure, Organization and functions 
(Government agencies), Pension insurance.

29 CFR Part 4006

    Employee benefit plans, Pension insurance.

[[Page 76664]]

29 CFR Part 4010

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

29 CFR Part 4022

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

29 CFR Part 4041A

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

29 CFR Part 4043

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

29 CFR Part 4211

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

29 CFR Part 4262

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

    For the reasons set forth in the preamble, PBGC is amending 29 CFR 
parts 4000, 4003, 4006, 4010, 4022, 4041A, 4043, 4211, and 4262 as 
follows.

PART 4000--FILING, ISSUANCE, COMPUTATION OF TIME, AND RECORD 
RETENTION

0
1. The authority citation for part 4000 continues to read as follows:

    Authority:  29 U.S.C. 1083(k), 1302(b)(3).


Sec.  4000.4  [Amended]

0
2. Amend Sec.  4000.4 by removing the words ``TTY/TDD users may call 
the Federal relay service toll-free at 1-800-877-8339 and ask to be 
connected to the appropriate number'' and adding in their place the 
words ``If you are deaf or hard of hearing or have a speech disability, 
please dial 7-1-1 to access telecommunications relay services''.


Sec.  4000.28  [Removed and Reserved]

0
3. Remove and reserve Sec.  4000.28.

PART 4003--RULES FOR ADMINISTRATIVE REVIEW OF AGENCY DECISIONS

0
4. The authority citation for part 4003 continues to read as follows:

    Authority:  29 U.S.C. 1302(b)(3).


Sec.  4003.35  [Amended]

0
5. Amend Sec.  4003.35 in paragraph (a) introductory text by removing 
the word ``final'' and in paragraph (a)(1) by removing the words 
``decision on request'' and adding in their place the words ``decision 
on a request''.

PART 4006--PREMIUM RATES

0
6. The authority citation for part 4006 continues to read as follows:

    Authority:  29 U.S.C. 1302(b)(3), 1306, 1307.


Sec.  4006.3  [Amended]

0
7. Amend Sec.  4006.3 by:
0
a. Removing the phrase ``ERISA section 4006(a)(3)(A), (F), and (G)'' 
and adding in its place the phrase ``section 4006(a)(3)(A) and (G) of 
ERISA'' in paragraph (a)(1).
0
b. Removing the phrase ``ERISA section 4006(a)(3)(A), (H), and (J)'' 
and adding in its place the phrase ``section 4006(a)(3)(A) and (J) of 
ERISA'' in paragraph (a)(2).


Sec.  4006.5  [Amended]

0
8. Amend Sec.  4006.5 in paragraph (b) by removing the phrase ``ERISA 
section 4006(a)(3)(H)'' and adding in its place the phrase ``section 
4006(a)(3)(I) of ERISA for certain small employers''.

PART 4010--ANNUAL FINANCIAL AND ACTUARIAL INFORMATION REPORTING

0
9. The authority citation for part 4010 continues to read as follows:

    Authority:  29 U.S.C. 1302(b)(3), 1310.


Sec.  4010.10  [Amended]

0
10. Amend Sec.  4010.10 in paragraph (b) by removing ``Sec.  
4010.8(b)(1)'' and adding in its place ``Sec.  4010.8(b)(2)(i)''.


Sec.  4010.13  [Amended]

0
11. Amend Sec.  4010.13 by removing the phrase ``Sec.  4901.21(a)(3)'' 
and adding in its place the phrase ``Sec.  4901.21(a)''.

PART 4022--BENEFITS PAYABLE IN TERMINATED SINGLE-EMPLOYER PLANS

0
12. 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
13. Revise the section heading for Sec.  4022.7 to read as follows:


Sec.  4022.7  Benefits payable in a lump sum.

* * * * *

PART 4041A--TERMINATION OF MULTIEMPLOYER PLANS

0
14. The authority citation for part 4041A continues to read as follows:

    Authority:  29 U.S.C. 1302(b)(3), 1341a, 1431, 1441.


Sec.  4041A.43  [Amended]

0
15. Amend Sec.  4041A.43 in paragraph (b)(1) by removing ``$5,000'' and 
adding in its place the words ``the dollar amount specified in section 
203(e)(1) of ERISA''.

PART 4043--REPORTABLE EVENTS AND CERTAIN OTHER NOTIFICATION 
REQUIREMENTS

0
16. The authority citation for part 4043 continues to read as follows:

    Authority:  29 U.S.C. 1083(k), 1302(b)(3), 1343.


Sec.  4043.8  [Amended]

0
17. Amend Sec.  4043.8 by removing ``Sec.  4901.21(a)(3)'' and adding 
in its place ``Sec.  4901.21(a)''.

PART 4211--ALLOCATING UNFUNDED VESTED BENEFITS TO WITHDRAWING 
EMPLOYERS

0
18. The authority citation for part 4211 continues to read as follows:

    Authority:  29 U.S.C. 1302(b)(3); 1391(c)(1), (c)(2)(D), 
(c)(5)(A), (c)(5)(B), (c)(5)(D), and (f).


Sec.  4211.31  [Amended]

0
19. Amend Sec.  4211.31 in paragraph (b) by removing the words 
``subpart B of this part'' and adding in its place the words ``set 
forth in subpart B of this part''.

PART 4262--SPECIAL FINANCIAL ASSISTANCE BY PBGC

0
20. The authority citation for part 4262 continues to read as follows:

    Authority:  29 U.S.C. 1302(b)(3), 1432.


Sec.  4262.16  [Amended]

0
21. Amend Sec.  4262.16 by revising paragraphs (g)(2)(viii) and (ix) 
and adding paragraph (g)(2)(xvi)(D) to read as follows:


Sec.  4262.16  Conditions for special financial assistance.

* * * * *
    (g) * * *
    (2) * * *
    (viii) SFA assets excluded. The value of the plan assets taken into 
account as of the end of each determination year is the value of the 
assets that would otherwise be taken into account in the absence of 
this provision reduced by the amount described in paragraph (g)(2)(ix) 
of this section. The value of plan assets determined under this 
paragraph (g)(2)(viii) may not be less than zero.
    (ix) Calculation of SFA assets excluded--(A) In general. Except for 
plans required to pay make-up

[[Page 76665]]

payments described in Sec.  4262.15(b), the amount described in this 
paragraph (g)(2)(ix)(A) is, as of the end of the determination year--
    (1) The total amount of special financial assistance paid to the 
plan under Sec.  4262.12 (as determined under Sec.  4262.12(a) or (b), 
or under Sec.  4262.12(b) and (c) for plans paid under a supplemented 
application, as applicable), minus the amount paid to PBGC under Sec.  
4262.12(e), as of the end of the determination year;
    (2) Multiplied by a fraction, the numerator of which is the number 
of years determined under paragraph (g)(2)(x) of this section as of the 
end of the determination year and the denominator of which is the 
number of years determined under paragraph (g)(2)(xi) of this section 
as of the end of the determination year.
    (B) Plans required to pay make-up payments. For plans required to 
pay make-up payments described in Sec.  4262.15(b), the amount 
described in this paragraph (g)(2)(ix)(B) is, as of the end of the 
determination year--
    (1) The total amount of special financial assistance paid to the 
plan under Sec.  4262.12 (as determined under Sec.  4262.12(a) or (b), 
or under Sec.  4262.12(b) and (c) for plans paid under a supplemented 
application, as applicable), minus the amount paid to PBGC under Sec.  
4262.12(e), and minus the amount of make-up payments paid by the plan 
to participants and beneficiaries under Sec.  4262.15(b) whether the 
payments are made from SFA assets or non-SFA assets, as of the end of 
the determination year;
    (2) Multiplied by a fraction, the numerator of which is the number 
of years determined under paragraph (g)(2)(x) of this section as of the 
end of the determination year and the denominator of which is the 
number of years determined under paragraph (g)(2)(xi) of this section 
as of the end of the determination year.
* * * * *
    (xvi) * * *
    (D) Example 4. In plan year 2022, Plan D received an SFA payment 
amount of $50,000,000 (not including the amount paid to PBGC for 
repayment of traditional financial assistance) and a supplemented SFA 
payment amount of $30,000,000. A total of $20,000,000 in lump-sum make-
up payments were paid by Plan D in plan year 2022. An employer 
withdraws in 2023. At the end of the determination year (2022), the 
amount of SFA required to be excluded from assets equals $60,000,000 
($50,000,000 + $30,000,000--$20,000,000). If, instead, the make-up 
payments were paid by Plan D in plan year 2023, the amount of SFA 
required to be excluded from assets at the end of the determination 
year (2022) would equal $80,000,000. Under this scenario, Plan D's 
unfunded vested benefit liability would be the same at the end of the 
determination year because the additional $20,000,000 of SFA required 
to be excluded from assets offsets the $20,000,000 in SFA that the plan 
still holds for make-up payments but has not yet distributed as of the 
end of the determination year. Similarly, if the employer withdraws in 
2024, the make-up payments were paid in 2023, and the phase-in fraction 
was 9/10th for 2023, the amount of SFA excluded from the assets at the 
end of the determination year (2023) would be $54,000,000 (9/10th x 
$60,000,000), where the $60,000,000 is calculated as the total 
$80,000,000 in SFA paid to the plan minus the $20,000,000 in make-up 
payments that were disbursed prior to the end of the determination 
year.

    Issued in Washington, DC.
Gordon Hartogensis,
Director, Pension Benefit Guaranty Corporation.
[FR Doc. 2023-24268 Filed 11-6-23; 8:45 am]
BILLING CODE 7709-02-P


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