[Federal Register Volume 59, Number 72 (Thursday, April 14, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8886]


[[Page Unknown]]

[Federal Register: April 14, 1994]


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PENSION BENEFIT GUARANTY CORPORATION

29 CFR Parts 2606, 2616, and 2617

 

Rules for Administrative Review of Agency Decisions; Distress 
Terminations of Single-Employer Plans; Standard Terminations of Single-
Employer Plans

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Final rule.

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SUMMARY: On August 24, 1993, the Pension Benefit Guaranty Corporation 
(``PBGC'') published an interim rule with request for comments amending 
certain of its regulations (Administrative Review of Agency Decisions 
and Standard Terminations of Single-Employer Plans) to permit the 
PBGC's Executive Director to grant relief from deadlines in the event 
of a major disaster. The PBGC is now adopting these amendments as a 
final rule and also is amending its distress termination regulation in 
order to give the Executive Director the authority to grant relief 
similar to that given in the interim rule for standard terminations.

EFFECTIVE DATE: April 14, 1994.

FOR FURTHER INFORMATION CONTACT: Harold J. Ashner, Assistant General 
Counsel, or Renae R. Hubbard, Special Counsel, Office of the General 
Counsel, Pension Benefit Guaranty Corporation, 1200 K Street NW., 
Washington, DC 20005, 202-326-4024 (202-326-4179 for TTY and TDD). 
(These are not toll-free numbers.)

SUPPLEMENTARY INFORMATION: On August 24, 1993, the Pension Benefit 
Guaranty Corporation (``PBGC'') published an interim rule with request 
for comments amending its regulations on Rules for Administrative 
Review of Agency Decisions and Standard Terminations of Single-Employer 
Plans (29 CFR parts 2606 and 2617, 58 FR 44738; as corrected, 58 FR 
48680, September 17, 1993). The interim rule provided that, when the 
President of the United States declares, under the Disaster Relief Act 
of 1974, as amended (42 U.S.C. 5121, 5122(2), 5141(b)), that a major 
disaster (such as the 1993 flood disaster in the midwestern United 
States) exists, the PBGC's Executive Director (or his or her designee) 
may grant relief from certain regulatory deadlines by which persons are 
to submit filings to the PBGC or take other actions. The PBGC received 
no comments and is adopting the interim rule as a final rule without 
change.
    Before the interim rule was published, Secs. 2606.33 and 2606.53 of 
the PBGC's administrative review regulation (29 CFR part 2606) provided 
deadlines for filing a request for reconsideration or appeal of an 
initial determination, and Sec. 2606.4 provided for extensions of those 
deadlines for good cause shown and only if requested in writing by the 
applicable filing deadline. The PBGC concluded that, when a major 
disaster like the 1993 midwestern flood is declared, the above 
deadlines do not serve the agency's objective of making timely review 
available to aggrieved persons. As amended, Sec. 2606.4 provides that 
the deadlines for filing a request for reconsideration or appeal may be 
extended by the Executive Director (or his or her designee) when a 
major disaster is declared. The extension may be for a period of up to 
180 days and applies to any aggrieved person who resides in, or whose 
principal place of business is within, a designated disaster area, or 
with respect to whom the office of the service provider, bank, 
insurance company, or other person maintaining the information 
necessary to file the request for reconsideration or appeal is within a 
designated disaster area.
    Similarly, as amended Secs. 2617.25 and 2617.28 of the PBGC's 
standard termination regulation (29 CFR part 2617) include an exception 
to the deadlines (1) for filing the standard termination notice with 
the PBGC (Secs. 2617.3(b)(2) and 2617.25(a)) and, consequently, for 
issuing notices of plan benefits to participants and beneficiaries 
(Secs. 2617.3(b)(3) and 2617.23(a)) and (2) for completing the 
distribution of plan assets (Sec. 2617.28(a), (e), and (f)). As in the 
administrative review regulation, the Executive Director (or his or her 
designee) may extend these deadlines for a period of up to 180 days 
when a major disaster is declared. The extension applies to plan 
terminations with respect to which the principal place of business of 
the contributing sponsor or the plan administrator, or the office of 
the service provider, bank, insurance company, or other person 
maintaining the information necessary to issue the notices of plan 
benefits or file the standard termination notice, or to complete the 
distribution of plan assets (as applicable), is within a designated 
disaster area.
    The PBGC believes that similar relief should be available for plans 
terminating in distress terminations pursuant to section 4041(c) of the 
Employee Retirement Income Security Act of 1974, as amended, and the 
PBGC's distress termination regulation (29 CFR part 2616). Sections 
2616.3(b), 2616.24, and 2616.25(c)(2) establish deadlines for filing a 
distress termination notice and related information with the PBGC. 
Section 2616.27(a)(1) establishes the deadline for issuing notices of 
benefit distribution in those few terminations where the plan is 
sufficient for at least guaranteed benefits and, accordingly, plan 
assets may be distributed to participants and beneficiaries in a manner 
similar to a standard termination distribution. (The notices of 
distribution are similar to the notices of plan benefits required in 
standard terminations under 29 CFR 2617.23.) Finally, 
Sec. 2616.29(a)(1) contains distribution procedures and deadlines that 
are generally the same as those in standard terminations; that section 
cross-references 29 CFR 2617.28 (c), (e), and (f) and provides the same 
180-day (unless extended) deadline for distribution.
    The amendments in this final rule permit the PBGC's Executive 
Director (or his or her designee) to extend the above deadlines in the 
same circumstances as were provided for standard terminations in the 
interim rule. (The PBGC did not include distress terminations in the 
interim rule because the small number of distress terminations filed 
annually lessened the need for prompt action; however, these provisions 
are essentially procedural in that they establish alternative 
mechanisms for obtaining extensions of filing or other deadlines (5 
U.S.C. 553(b)(A)), and the notice and public procedure and delayed 
effective date requirements of 5 U.S.C. 553 therefore do not apply.)

E.O. 12866

    The PBGC has determined that this action is not a ``significant 
regulatory action'' under the criteria set forth in Executive Order 
12866, because it will not have an annual effect on the economy of $100 
million or more or adversely affect in a material way the economy, a 
sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities; create a serious inconsistency or otherwise 
interfere with an action taken or planned by another agency; materially 
alter the budgetary impact of entitlements, grants, user fees, or loan 
programs or the rights and obligations of recipients thereof; or raise 
novel legal or policy issues arising out of legal mandates, the 
President's priorities, or the principles set forth in Executive Order 
12866.

List of Subjects

29 CFR Part 2606

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

29 CFR Parts 2616 and 2617

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

    In consideration of the foregoing, the interim final rule amending 
29 CFR parts 2606 and 2617, as published on August 24, 1993, at 58 FR 
44738 and corrected on September 17, 1993, at 58 FR 48600, is adopted 
as a final rule without change, and 29 CFR part 2616 is amended as 
follows:

PART 2616--DISTRESS TERMINATIONS OF SINGLE-EMPLOYER PLANS

    1. The authority citation for part 2616 continues to read as 
follows:

    Authority: 29 U.S.C. 1302(b)(3), 1341, 1344.


Sec. 2616.3  [Amended]

    2. Paragraph (b)(2) of Sec. 2616.3 is amended by adding ``or, if 
applicable, no later than the due date established in an extension 
notice issued under Sec. 2616.10'' after ``date'' and before the 
semicolon.
    2a. Section 2616.10 is redesignated as Sec. 2616.11.
    3. A new Sec. 2616.10 is added to subpart A to read as follows:


Sec. 2616.10  Disaster relief.

    (a) Notwithstanding any other provision in this part, when the 
President of the United States declares that, under the Disaster Relief 
Act of 1974, as amended (42 U.S.C. 5121, 5122(2), 5141(b)), a major 
disaster exists, the Executive Director of the PBGC (or his or her 
designee) may, by issuing one or more notices of disaster relief, 
extend the due date for filing the distress termination notice pursuant 
to Sec. 2616.24, for issuing the notices of benefit distribution 
pursuant to Sec. 2616.27(a)(1), or for completing the distribution of 
plan assets pursuant to Sec. 2616.29, by up to 180 days.
    (b) The due date extension or extensions shall apply only to plan 
terminations with respect to which the principal place of business of 
the contributing sponsor or the plan administrator, or the office of 
the service provider, bank, insurance company, or other person 
maintaining the information necessary to file the distress termination 
notice, to issue the notices of benefit distribution, or to complete 
the distribution of plan assets (as applicable), is within a designated 
disaster area.
    (c) The distress termination notice filed pursuant to Sec. 2616.24, 
or the post-distribution certification filed pursuant to 
Sec. 2616.29(b) shall identify the distress termination notice filing 
or the distribution (as applicable) as being qualified for the due date 
extension.

    4. Section 2616.24 is amended by adding paragraph (d) to read as 
follows:


Sec. 2616.24  Distress termination notice.

* * * * *
    (d) Due date extension. Notwithstanding the provisions of 
paragraphs (a), (b), and (c) of this section, the due date for filing 
PBGC Form 601 or other information required under this section may be 
extended by a notice issued under Sec. 2616.10.


Sec. 2616.25  [Amended]

    5. Paragraph (c)(2) of Sec. 2616.25 is amended by adding ``, or, if 
applicable, no later than the due date established in an extension 
notice issued under Sec. 2616.10'' after ``later'' and before the 
period.


Sec. 2616.27  [Amended]

    6. Paragraph (a)(1) of Sec. 2616.27 is amended by adding ``or, if 
applicable, no later than the due date established in an extension 
notice issued under Sec. 2616.10'' after ``distribution notice'' and 
before the comma.


Sec. 2616.29  [Amended]

    7. Paragraph (a)(1) of Sec. 2616.29 is amended by removing 
``2617.28 (c), (e) and (f)'' and adding in its place ``2617.28(c)'' and 
by adding ``(except as provided in Sec. 2616.10 or 2617.28 (e) or 
(f))'' after ``61st day and'' and before ``no later than''.

    Issued in Washington, DC this 8th day of April 1994.
Martin Slate,
Executive Director, Pension Benefit Guaranty Corporation.
[FR Doc. 94-8886 Filed 4-13-94; 8:45 am]
BILLING CODE 7708-01-M