[Federal Register Volume 66, Number 116 (Friday, June 15, 2001)]
[Notices]
[Pages 32650-32653]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-15160]


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PENSION BENEFIT GUARANTY CORPORATION


Proposed Submission of Information Collections for OMB Review; 
Comment Request; Multiemployer Plan Regulations

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Notice of intention to request extension of OMB approval.

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SUMMARY: The Pension Benefit Guaranty Corporation (PBGC) intends to 
request that the Office of Management and Budget (OMB) extend approval, 
under the Paperwork Reduction Act, of collections of information in the 
PBGC's regulations on multiemployer plans under the Employee Retirement 
Income Security Act of 1974 (ERISA). This notice informs the public of 
the PBGC's intent and solicits public comment on the collections of 
information.

DATES: Comments must be submitted by August 14, 2001.

ADDRESSES: Comments may be mailed to the Office of the General Counsel, 
suite 340, Pension Benefit Guaranty Corporation, 1200 K Street, NW., 
Washington, DC 20005-4026, or delivered to that address between 9 a.m. 
and 4 p.m. on business days. Written comments will be available for 
public inspection at the PBGC's Communications and Public Affairs 
Department, suite 240 at the same address, between 9 a.m. and 4 p.m. on 
business days.
    Copies of the collection of information may be obtained without 
charge by writing to the PBGC's Communications and Public Affairs 
Department at the address given above or calling 202-326-4040. (For TTY 
and TDD, call 800-877-8339 and request connection to 202-326-4040). The 
regulations on multiemployer plans can be accessed on the PBGC's Web 
site at http://www.pbgc.gov.

FOR FURTHER INFORMATION CONTACT: Deborah C. Murphy, Attorney, Office of 
the General Counsel, Pension Benefit Guaranty Corporation, 1200 K 
Street, NW., Washington, DC 20005-4026, 202-326-4024. (For TTY/TDD 
users, call the Federal relay service toll-free at 1-800-877-8339 and 
ask to be connected to 202-326-4024.)

SUPPLEMENTARY INFORMATION: An agency may not conduct or sponsor, and a 
person is not required to respond to, a collection of information 
unless it displays a currently valid OMB control number. OMB has 
approved and issued control numbers for the collections of information, 
described below, in the

[[Page 32651]]

PBGC's regulations relating to multiemployer plans. The PBGC intends to 
request that OMB extend its approval of these collections of 
information for three years.
    The PBGC is soliciting public comments to--
     Evaluate whether the proposed collections of information 
are 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 collections of information, including the 
validity of the methodologies and assumptions used;
     Enhance the quality, utility, and clarity of the 
information to be collected; and
     Minimize the burden of the collections 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.

Comments should identify the specific part number(s) of the 
regulation(s) they relate to.
    The collections of information for which the PBGC intends to 
request extension of OMB approval are as follows:

1. Termination of Multiemployer Plans (29 CFR Part 4041A) (OMB 
Control Number 1212-0020)

    Section 4041A(f)(2) of ERISA authorizes the PBGC to prescribe 
reporting requirements for and other ``rules and standards for the 
administration of'' terminated multiemployer plans. Section 4041A(c) 
and (f)(1) of ERISA prohibit the payment by a mass-withdrawal-
terminated plan of lump sums greater than $1,750 or of nonvested plan 
benefits unless authorized by the PBGC.
    The regulation requires the plan sponsor of a terminated plan to 
submit a notice of termination to the PBGC. It also requires the plan 
sponsor of a mass-withdrawal-terminated plan that is closing out to 
give notices to participants regarding the election of alternative 
forms of benefit distribution and to obtain PBGC approval to pay lump 
sums greater than $1,750 or to pay nonvested plan benefits.
    The PBGC uses the information in a notice of termination to assess 
the likelihood that PBGC financial assistance will be needed. Plan 
participants and beneficiaries use the information on alternative forms 
of benefit to make personal financial decisions. The PBGC uses the 
information in an application for approval to pay lump sums greater 
than $1,750 or to pay nonvested plan benefits to determine whether such 
payments should be permitted.
    The PBGC estimates that plan sponsors each year (1) submit notices 
of termination for 10 plans, (2) distribute election notices to 
participants in 7 of those plans, and (3) submit requests to pay 
benefits or benefit forms not otherwise permitted for 1 of those plans. 
The estimated annual burden of the collection of information is 22.75 
hours and $9,031.

2. Extension of Special Withdrawal Liability Rules (29 CFR Part 
4203) (OMB Control Number 1212-0023)

    Sections 4203(f) and 4208(e)(3) of ERISA allow the PBGC to permit a 
multiemployer plan to adopt special rules for determining whether a 
withdrawal from the plan has occurred, subject to PBGC approval.
    The regulation specifies the information that a plan that adopts 
special rules must submit to the PBGC about the rules, the plan, and 
the industry in which the plan operates. The PBGC uses the information 
to determine whether the rules are appropriate for the industry in 
which the plan functions and donot pose a significant risk to the 
insurance system.
    The PBGC estimates that at most 1 plan sponsor submits a request 
each year under this regulation. The estimated annual burden of the 
collection of information is 1 hour and $3,200.

3. Variances for Sale of Assets (29 CFR Part 4204) (OMB Control 
Number 1212-0021)

    If an employer's covered operations or contribution obligation 
under a plan ceases, the employer must generally pay withdrawal 
liability to the plan. Section 4204 of ERISA provides an exception, 
under certain conditions, where the cessation results from a sale of 
assets. Among other things, the buyer must furnish a bond or escrow, 
and the sale contract must provide for secondary liability of the 
seller.
    The regulation establishes general variances (rules for avoiding 
the bond/escrow and sale-contract requirements) and authorizes plans to 
determine whether the variances apply in particular cases. It also 
allows buyers and sellers to request individual variances from the 
PBGC. Plans and the PBGC use the information to determine whether 
employers qualify for variances.
    The PBGC estimates that each year, 11 employers submit, and 11 
plans respond to, variance requests under the regulation, and 2 
employers submit variance requests to the PBGC. The estimated annual 
burden of the collection of information is 1 hour and $3,550.

4. Reduction or Waiver of Complete Withdrawal Liability (29 CFR 
Part 4207) (OMB Control Number 1212-0044)

    Section 4207 of ERISA allows the PBGC to provide for abatement of 
an employer's complete withdrawal liability, and for plan adoption of 
alternative abatement rules, where appropriate.
    Under the regulation, an employer applies to a plan for an 
abatement determination, providing information the plan needs to 
determine whether withdrawal liability should be abated, and the plan 
notifies the employer of its determination. The employer may, pending 
plan action, furnish a bond or escrow instead of making withdrawal 
liability payments, and must notify the plan if it does so. When the 
plan then makes its determination, it must so notify the bonding or 
escrow agent.
    The regulation also permits plans to adopt their own abatement 
rules and request PBGC approval. The PBGC uses the information in such 
a request to determine whether the amendment should be approved.
    The PBGC estimates that each year, 100 employers submit, and 100 
plans respond to, applications for abatement of complete withdrawal 
liability, and 1 plan sponsor requests approval of plan abatement rules 
from the PBGC. The estimated annual burden of the collection of 
information is 25.5 hours and $20,000.

5. Reduction or Waiver of Partial Withdrawal Liability (29 CFR Part 
4208) (OMB Control Number 1212-0039)

    Section 4208 of ERISA provides for abatement, in certain 
circumstances, of an employer's partial withdrawal liability and 
authorizes the PBGC to issue additional partial withdrawal liability 
abatement rules.
    Under the regulation, an employer applies to a plan for an 
abatement determination, providing information the plan needs to 
determine whether withdrawal liability should be abated, and the plan 
notifies the employer of its determination. The employer may, pending 
plan action, furnish a bond or escrow instead of making withdrawal 
liability payments, and must notify the plan if it does so. When the 
plan then

[[Page 32652]]

makes its determination, it must so notify the bonding or escrow agent.
    The regulation also permits plans to adopt their own abatement 
rules and request PBGC approval. The PBGC uses the information in such 
a request to determine whether the amendment should be approved.
    The PBGC estimates that each year, 1,000 employers submit, and 
1,000 plans respond to, applications for abatement of partial 
withdrawal liability and 1 plan sponsor requests approval of plan 
abatement rules from the PBGC. The estimated annual burden of the 
collection of information is 250.5 hours and $200,000.

6. Allocating Unfunded Vested Benefits to Withdrawing Employers (29 
CFR Part 4211) (OMB Control Number 1212-0035)

    Section 4211(c)(5)(A) of ERISA requires the PBGC to prescribe how 
plans can, with PBGC approval, change the way they allocate unfunded 
vested benefits to withdrawing employers for purposes of calculating 
withdrawal liability.
    The regulation prescribes the information that must be submitted to 
the PBGC by a plan seeking such approval. The PBGC uses the information 
to determine how the amendment changes the way the plan allocates 
unfunded vested benefits and how it will affect the risk of loss to 
plan participants and the PBGC.
    The PBGC estimates that 5 plan sponsors submit approval requests 
each year under this regulation. The estimated annual burden of the 
collection of information is 10 hours.

7. Notice, Collection, and Redetermination of Withdrawal Liability 
(29 CFR Part 4219) (OMB Control Number 1212-0034)

    Section 4219(c)(1)(D) of ERISA requires that the PBGC prescribe 
regulations for the allocation of a plan's total unfunded vested 
benefits in the event of a ``mass withdrawal.'' ERISA section 4209(c) 
deals with an employer's liability for de minimis amounts if the 
employer withdraws in a ``substantial withdrawal.''
    The reporting requirements in the regulation give employers notice 
of a mass withdrawal or substantial withdrawal and advise them of their 
rights and liabilities. They also provide notice to the PBGC so that it 
can monitor the plan, and they help the PBGC assess the possible impact 
of a withdrawal event on participants and the multiemployer plan 
insurance program.
    The PBGC estimates that there is at most 1 mass withdrawal and 1 
substantial withdrawal per year. The plan sponsor of a plan subject to 
a withdrawal covered by the regulation provides notices of the 
withdrawal to the PBGC and to employers covered by the plan, liability 
assessments to the employers, and a certification to the PBGC that 
assessments have been made. (For a mass withdrawal, there are 2 
assessments and 2 certifications that deal with 2 different types of 
liability. For a substantial withdrawal, there is 1 assessment and 1 
certification (combined with the withdrawal notice to the PBGC).) The 
estimated annual burden of the collection of information is 4 hours and 
$5,220.

8. Procedures for PBGC Approval of Plan Amendments (29 CFR Part 
4220) (OMB Control Number 1212-0031)

    Under section 4220 of ERISA, a plan may within certain limits adopt 
special plan rules regarding when a withdrawal from the plan occurs and 
how the withdrawing employer's withdrawal liability is determined. Any 
such special rule is effective only if, within 90 days after receiving 
notice and a copy of the rule, the PBGC either approves or fails to 
disapprove the rule.
    The regulation provides rules for requesting the PBGC's approval of 
an amendment. The PBGC needs the required information to identify the 
plan, evaluate the risk of loss, if any, posed by the plan amendment, 
and determine whether to approve or disapprove the amendment.
    The PBGC estimates that 3 plan sponsors submit approval requests 
per year under this regulation. The estimated annual burden of the 
collection of information is 1.5 hours.

9. Mergers and Transfers Between Multiemployer Plans (29 CFR Part 
4231) (OMB Control Number 1212-0022)

    Section 4231(a) and (b) of ERISA requires plans that are involved 
in a merger or transfer to give the PBGC 120 days' notice of the 
transaction and provides that if the PBGC determines that specified 
requirements are satisfied, the transaction will be deemed not to be in 
violation of ERISA section 406(a) or (b)(2) (dealing with prohibited 
transactions).
    This regulation sets forth the procedures for giving notice of a 
merger or transfer under section 4231 and for requesting a 
determination that a transaction complies with section 4231.
    The PBGC uses information submitted by plan sponsors under the 
regulation to determine whether mergers and transfers conform to the 
requirements of ERISA section 4231 and the regulation.
    The PBGC estimates that there are 35 transactions each year for 
which plan sponsors submit notices and approval requests under this 
regulation. The estimated annual burden of the collection of 
information is 8.75 hours and $5,569.

10. Notice of Insolvency (29 CFR Part 4245) (OMB Control Number 
1212-0033)

    If the plan sponsor of a plan in reorganization under ERISA section 
4241 determines that the plan may become insolvent, ERISA section 
4245(e) requires the plan sponsor to give a ``notice of insolvency'' to 
the PBGC, contributing employers, and plan participants and their 
unions in accordance with PBGC rules.
    For each insolvency year under ERISA section 4245(b)(4), ERISA 
section 4245(e) also requires the plan sponsor to give a ``notice of 
insolvency benefit level'' to the same parties.
    This regulation establishes the procedure for giving these notices. 
The PBGC uses the information submitted to estimate cash needs for 
financial assistance to troubled plans. Employers and unions use the 
information to decide whether additional plan contributions will be 
made to avoid the insolvency and consequent benefit suspensions. Plan 
participants and beneficiaries use the information in personal 
financial decisions.
    The PBGC estimates that 9 plan sponsors give notices each year 
under this regulation. The estimated annual burden of the collection of 
information is 1 hour and $13,366.

11. Duties of Plan Sponsor Following Mass Withdrawal (29 CFR Part 
4281) (OMB Control Number 1212-0032)

    Section 4281 of ERISA provides rules for plans that have terminated 
by mass withdrawal. Under section 4281, if nonforfeitable benefits 
exceed plan assets, the plan sponsor must amend the plan to reduce 
benefits. If the plan nevertheless becomes insolvent, the plan sponsor 
must suspend certain benefits that cannot be paid. If available 
resources are inadequate to pay guaranteed benefits, the plan sponsor 
must request financial assistance from the PBGC.
    The regulation requires a plan sponsor to give notices of benefit 
reduction, notices of insolvency and annual updates, and notices of 
insolvency benefit level to the PBGC and to participants and 
beneficiaries and, if necessary, to apply to the PBGC for financial 
assistance.

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    The PBGC uses the information it receives to make determinations 
required by ERISA, to identify and estimate the cash needed for 
financial assistance to terminated plans, and to verify the 
appropriateness of financial assistance payments. Plan participants and 
beneficiaries use the information to make personal financial decisions.
    The PBGC estimates that plan sponsors each year give benefit 
reduction notices for 1 plan and give notices of insolvency benefit 
level and annual updates, and submit requests for financial assistance, 
for 25 plans. Of those 25 plans, the PBGC estimates that plan sponsors 
each year give notices of insolvency for 3 plans. The estimated annual 
burden of the collection of information is 1 hour and $115,856.

    Issued in Washington, DC, this 12th day of June, 2001.
Stuart A. Sirkin,
Director, Corporate Policy and Research Department, Pension Benefit 
Guaranty Corporation.
[FR Doc. 01-15160 Filed 6-14-01; 8:45 am]
BILLING CODE 7708-01-P