[Federal Register Volume 65, Number 163 (Tuesday, August 22, 2000)]
[Notices]
[Page 51037]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-21330]


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DEPARTMENT OF LABOR

Pension and Welfare Benefits Administration


Proposed Extension of Information Collection; Comment Request; 
Prohibited Transaction Exemption 88-59

ACTION: Notice.

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SUMMARY: The Department of Labor (Department), as part of its 
continuing effort to reduce paperwork and respondent burden, conducts a 
preclearance consultation program to provide the general public and 
Federal agencies with an opportunity to comment on proposed and 
continuing collections of information in accordance with the Paperwork 
Reduction Act of 1995 (PRA 95) (44 U.S.C. 3506(c)(2)(A)). This helps to 
ensure that requested data can be provided in the desired format, 
reporting burden (time and financial resources) is minimized, 
collection instruments are clearly understood, and the impact of 
collection requirements on respondents can be properly assessed.
    Currently, the Pension and Welfare Benefits Administration is 
soliciting comments concerning the proposed extension of the 
information collection provisions of Prohibited Transaction Class 
Exemption 88-59. A copy of the Information Collection Request (ICR) may 
be obtained by contacting the office listed in the ADDRESSES section of 
this notice.

DATES: Written comments must be submitted to the office shown in the 
ADDRESSES section below on or before October 23, 2000.

ADDRESSES: Gerald B. Lindrew, Office of Policy and Research, U.S. 
Department of Labor, Pension and Welfare Benefits Administration, 200 
Constitution Avenue, NW., Room N-5647, Washington, DC 20210. Telephone: 
(202) 219-4782; Fax: (202) 219-4745. These are not toll-free numbers.

SUPPLEMENTARY INFORMATION:

I. Background

    Prohibited Transaction Class Exemption 88-59 provides an exemption 
from the prohibited transaction provisions of the Employment Retirement 
Income Security Act of 1974 (ERISA) and from certain taxes imposed by 
the Internal Revenue Code of 1986 (Code). The exemption permits, under 
certain conditions, an employee benefit plan to provide mortgage 
financing to purchasers of residential dwelling units. The mortgage 
financing may be either by making or participating in loans directly to 
purchasers or by purchasing mortgage loans or participation interests 
in mortgage loans originated by a third party. Plan investments in real 
estate mortgage loans typically involve a continuing relationship 
between the seller of the mortgage loan and the plan for purposes of 
servicing the mortgage loan investment. This provision of services by 
the seller creates a party in interest relationship between such 
servicer and the investing plan. Accordingly, any subsequent purchase 
of mortgage loans from such an existing party in interest service 
provider, absent exemptive relief, results in a prohibited transaction. 
The exemption affects participants and beneficiaries of the plans that 
are involved in such transactions as well as the seller of the mortgage 
loan.

II. Desired Focus of Comments

    The Department is particularly interested in comments that:
     Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
     Evaluate the accuracy of the agency's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
     Enhance the quality, utility, and clarity of the 
information to be collected; and
     Minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of responses.

III. Current Action

    This existing information collection should be continued because 
without this exemption, plans would be unable to participate in the 
mortgage financing of residential dwelling units. For the Department to 
grant an exemption, however, it must ensure the participants and 
beneficiaries are protected. It, therefore, included certain 
recordkeeping requirements. This class exemption requires the plan to 
maintain for six years from the date of the transaction the records 
necessary to enable interested parties, including the Department, to 
determine whether the conditions of the exemption have been met. The 
exemption also requires that those records be made available to certain 
persons on request. The Department and other interested parties need 
the records to enforce the terms of exemption and to insure user 
compliance in order to protect participants and beneficiaries.
    Type of Review: Extension of a currently approved collection of 
information.
    Agency: Pension and Welfare Benefits Administration, Department of 
Labor.
    Titles: Prohibited Transaction Class Exemption 88-59 Residential 
Mortgage Financing Arrangements.
    OMB Number: 1210-0095.
    Affected Public: Individuals or households; business or other for-
profit; not-for-profit institutions.
    Respondents: 185.
    Frequency of Response: On occasion.
    Responses: 185.
    Average Time per Response: 5 minutes.
    Estimated Total Burden Hours: 15.
    Total Burden Cost (Capital/Startup): $0.00.
    Total Burden Cost (Operating and Maintenance): $0.00.
    Comments submitted in response to this notice will be summarized 
and/or included in the request for OMB approval of the information 
collection request; they will also become a matter of public record.

    Dated: August 15, 2000.
Gerald B. Lindrew,
Deputy Director, Office of Policy and Research, Pension and Welfare 
Benefits Administration.
[FR Doc. 00-21330 Filed 8-21-00; 8:45 am]
BILLING CODE 4510-29-M