[Federal Register Volume 68, Number 172 (Friday, September 5, 2003)]
[Notices]
[Pages 52789-52790]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-22623]


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DEPARTMENT OF LABOR

Employee Benefits Security Administration

[Prohibited Transaction Exemption 2003-27; Exemption Application No. D-
10992 et al.]


Grant of Individual Exemptions; Local 705 International 
Brotherhood of Teamsters Pension Plan (the Plan)

AGENCY: Employee Benefits Security Administration, Labor.

ACTION: Grant of individual exemptions.

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SUMMARY: This document contains exemptions issued by the Department of 
Labor (the Department) from certain of the prohibited transaction 
restrictions of the Employee Retirement Income Security Act of 1974 
(the Act) and/or the Internal Revenue Code of 1986 (the Code).
    A notice was published in the Federal Register of the pendency 
before the Department of a proposal to grant such exemption. The notice 
set forth a summary of facts and representations contained in the 
application for exemption and referred interested persons to the 
application for a complete statement of the facts and representations. 
The application has been available for public inspection at the 
Department in Washington, DC. The notice also invited interested 
persons to submit comments on the requested exemption to the 
Department. In addition the notice stated that any interested person 
might submit a written request that a public hearing be held (where 
appropriate). The applicant has represented that it has complied with 
the requirements of the notification to interested persons. No requests 
for a hearing were received by the Department. Public comments were 
received by the Department as described in the granted exemption.
    The notice of proposed exemption was issued and the exemption is 
being granted solely by the Department because, effective December 31, 
1978, section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1 
(1996), transferred the authority of the Secretary of the Treasury to 
issue exemptions of the type proposed to the Secretary of Labor.

Statutory Findings

    In accordance with section 408(a) of the Act and/or section 
4975(c)(2) of the Code and the procedures set forth in 29 CFR Part 
2570, Subpart B (55 FR 32836, 32847, August 10, 1990) and based upon 
the entire record, the Department makes the following findings:
    (a) The exemption is administratively feasible;
    (b) The exemption is in the interests of the plan and its 
participants and beneficiaries; and
    (c) The exemption is protective of the rights of the participants 
and beneficiaries of the plan.

Local 705 International Brotherhood of Teamsters Pension Plan (the 
Plan) Located in Chicago, Illinois

[Prohibited Transaction Exemption No. 2003-27; Application No. D-10992]

Exemption

    The restrictions of sections 406(a) and 406(b)(1) and (b)(2) of the 
Act and the sanctions resulting from the application of section 4975 of 
the Code, by reason of section 4975(c)(1)(A) through (E) of the Code, 
shall not apply to the proposed purchase of a 10 ft. x 52.6 ft. parcel 
of real property (the Property) by the West Side Realty Corporation, a 
wholly owned affiliate of the Plan from Local 705 Building Corporation 
(the Building Corporation), a party in interest with respect to the 
Plan. This exemption is conditioned upon the adherence to the material 
facts and representations described herein and upon the satisfaction of 
the following requirements:
    (a) The purchase of the Property by the Plan is a one-time 
transaction for cash;
    (b) The Plan pays no more than the lesser of: (i) $147,000; or (ii) 
the fair market value of the Property as determined at the time of the 
transaction;
    (c) The fair market value of the Property is established by an 
independent, qualified, real estate appraiser that is unrelated to the 
Building Corporation or any other party in interest with respect to the 
Plan;
    (d) The Plan will not pay any commissions or other expenses with 
respect to the transaction; and
    (e) The Townsend Group, Institutional Real Estate Consultants, 
acting as an independent, qualified, fiduciary for the Plan, determines 
that the proposed transaction is in the best interest of the Plan and 
its participants and beneficiaries.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this

[[Page 52790]]

exemption, refer to the Notice of Proposed Exemption published on May 
5, 2003 at 68 FR 23766.

FOR FURTHER INFORMATION CONTACT: Mr. Khalif I. Ford of the Department, 
telephone (202) 693-8540. (This is not a toll-free number.)

Raleigh Pathology Laboratory Associates, P.A. Profit Sharing Plan (the 
Plan) Located in Raleigh, NC

[Prohibited Transaction Exemption 2003-28; Exemption Application No. D-
11171]

Exemption

    The restrictions of sections 406(a), 406(b)(1) and (b)(2) of the 
Act and the sanctions resulting from the application of section 4975 of 
the Code, by reason of section 4975(c)(1)(A) through (E) of the 
Code,\1\ shall not apply to the exchange of an unimproved waterfront 
lot (the Pine Knoll Shores Lot) owned by the Plan and allocated to the 
individually-directed account (the Account) in the Plan of James R. 
Edwards, M.D., for one unimproved tract of land (Parcel One) owned 
personally by Dr. Edwards and his spouse, Mrs. Delores Edwards.
    This exemption is subject to the following conditions: (a) The 
exchange of the Pine Knoll Shores Lot between the Account and Dr. and 
Mrs. Edwards for Parcel One is a one-time transaction.
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    \1\ For purposes of this exemption, references to specific 
provisions of title I of the Act, unless otherwise specified, refer 
also to the corresponding provisions of the Code.
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    (b) The fair market value of the Pine Knoll Shores Lot and Parcel 
One is determined by qualified, independent appraisers, who will update 
their appraisal reports at the time the exchange is consummated.
    (c) For purposes of the exchange, Parcel One has a fair market 
value that is no less than the fair market value of the Pine Knoll 
Shores Lot at the time the transaction is consummated.
    (d) The terms and conditions of the exchange are at least as 
favorable to the Account as those obtainable in an arm's-length 
transaction with an unrelated party.
    (e) The exchange does not involve more than 25 percent of the 
Account's assets.
    (f) The exchange allows the Account to divest itself of property 
that is susceptible to hurricane damage and high maintenance costs, and 
it permits the Account to acquire virtually maintenance-proof property 
having increased liquidity.
    (g) Dr. Edwards is the only participant in the Plan whose Account 
is affected by the transaction and he desires that such transaction be 
consummated.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption, refer to 
the notice of proposed exemption published on June 24, 2003 at 68 FR 
37545.

FOR FURTHER INFORMATION CONTACT: Ms. Blessed Chuksorji, telephone (202) 
693-8567. (This is not a toll-free number.)

Valley OB-GYN Clinic P.C. Employees Pension Plan (the Plan) Located in 
Saginaw, Michigan

[Prohibited Transaction Exemption 2003-29; Application No. D-11172]

Exemption

    The restrictions of sections 406(a), 406(b)(1) and (b)(2) of the 
Act and the sanctions resulting from the application of section 4975 of 
the Code, by reason of section 4975(c)(1)(A) through (E) of the Code, 
shall not apply to the loan of $550,000 (the Loan) by the Plan to 
Valley OB-GYN Realty Company (the Company), a party in interest with 
respect to the Plan; provided that the following conditions are 
satisfied:
    a. The Loan does not exceed 25% of the total assets of the Plan at 
any time;
    b. The terms of the Loan are at least as favorable to the Plan as 
those terms which would exist in an arm's-length transaction with an 
unrelated party;
    c. The Loan is secured by a building which has a fair market value, 
as determined by an independent, qualified appraiser, of at least 150% 
of the outstanding principal balance of the Loan (plus accrued but 
unpaid interest) throughout its duration (unless other property is 
pledged as collateral, as noted below in condition f.);
    d. An independent, qualified fiduciary (the Independent Fiduciary) 
reviews the proposed terms and conditions of the Loan, and determines 
that the Loan is in the best interest and protective of the Plan and 
its participants and beneficiaries;
    e. The Independent Fiduciary monitors the Loan throughout its 
duration and takes whatever actions are necessary to safeguard the 
interests of the Plan and its participants and beneficiaries; and
    f. The Plan has the right, under the terms of the Loan and mortgage 
note related thereto, to require the Company to pledge additional 
property as collateral for the Loan, in the event such property is 
needed to maintain full collateralization at the amount specified 
herein.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption, refer to 
the notice of proposed exemption published on June 24, 2003 at 68 FR 
37546.

FOR FURTHER INFORMATION CONTACT: Ekaterina A. Uzlyan of the Department 
at (202) 693-8540. (This is not a toll-free number.)

General Information

    The attention of interested persons is directed to the following:
    (1) The fact that a transaction is the subject of an exemption 
under section 408(a) of the Act and/or section 4975(c)(2) of the Code 
does not relieve a fiduciary or other party in interest or disqualified 
person from certain other provisions to which the exemption does not 
apply and the general fiduciary responsibility provisions of section 
404 of the Act, which among other things require a fiduciary to 
discharge his duties respecting the plan solely in the interest of the 
participants and beneficiaries of the plan and in a prudent fashion in 
accordance with section 404(a)(1)(B) of the Act; nor does it affect the 
requirement of section 401(a) of the Code that the plan must operate 
for the exclusive benefit of the employees of the employer maintaining 
the plan and their beneficiaries;
    (2) This exemption is supplemental to and not in derogation of, any 
other provisions of the Act and/or the Code, including statutory or 
administrative exemptions and transactional rules. Furthermore, the 
fact that a transaction is subject to an administrative or statutory 
exemption is not dispositive of whether the transaction is in fact a 
prohibited transaction; and
    (3) The availability of this exemption is subject to the express 
condition that the material facts and representations contained in the 
application accurately describes all material terms of the transaction 
which is the subject of the exemption.

    Signed at Washington, DC, this 2nd day of September, 2003.
Ivan Strasfeld,
Director of Exemption Determinations, Employee Benefits Security 
Administration, Department of Labor.
[FR Doc. 03-22623 Filed 9-4-03; 8:45 am]
BILLING CODE 4510-29-P