[Federal Register Volume 85, Number 73 (Wednesday, April 15, 2020)]
[Rules and Regulations]
[Pages 20829-20830]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07763]


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PENSION BENEFIT GUARANTY CORPORATION

29 CFR Part 4022


Benefits Payable in Terminated Single-Employer Plans; Interest 
Assumptions for Paying Benefits

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Final rule.

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SUMMARY: This final rule amends the Pension Benefit Guaranty 
Corporation's regulation on Benefits Payable in Terminated Single-
Employer Plans to prescribe certain interest assumptions under the 
regulation for plans with valuation dates in May 2020. These interest 
assumptions are used for paying certain benefits under terminating 
single-employer plans covered by the pension insurance system 
administered by PBGC.

DATES: Effective May 1, 2020.

FOR FURTHER INFORMATION CONTACT: Gregory Katz ([email protected]), 
Attorney, Regulatory Affairs Division, Pension Benefit Guaranty 
Corporation, 1200 K Street NW, Washington, DC 20005, 202-326-4400 ext. 
3829. (TTY users may call the Federal relay service toll-free at 1-800-
877-8339 and ask to be connected to 202-326-4400, ext. 3829.)

SUPPLEMENTARY INFORMATION: PBGC's regulation on Benefits Payable in 
Terminated Single-Employer Plans (29 CFR part 4022) prescribes 
actuarial assumptions--including interest assumptions--for paying plan 
benefits under terminated single-employer plans covered by title IV of 
the Employee Retirement Income Security Act of 1974 (ERISA). The 
interest assumptions in the regulation are also published on PBGC's 
website (https://www.pbgc.gov).
    PBGC uses the interest assumptions in appendix B to part 4022 
(``Lump Sum Interest Rates for PBGC Payments'') to determine whether a 
benefit is payable as a lump sum and to determine the amount to pay. 
Because some private-sector pension plans use these interest rates to 
determine lump sum amounts payable to plan participants (if the 
resulting lump sum is larger than the amount required under section 
417(e)(3) of the Internal Revenue Code and section 205(g)(3) of ERISA), 
these rates are also provided in appendix C to part 4022 (``Lump Sum 
Interest Rates for Private-Sector Payments'').
    This final rule updates appendices B and C of the benefit payments 
regulation to provide the rates for May 2020 measurement dates.
    The May 2020 lump sum interest assumptions will be 0.50 percent for 
the period during which a benefit is (or is assumed to be) in pay 
status and 4.00 percent during any years preceding the benefit's 
placement in pay status. In comparison with the interest assumptions in 
effect for April 2020, these assumptions represent an increase of 0.50 
percent in the immediate rate and are otherwise unchanged.
    PBGC updates appendices B and C each month. PBGC has determined 
that notice and public comment on this amendment are impracticable and 
contrary to the public interest. This finding is based on the need to 
issue new interest assumptions promptly so that they are available for 
plans that rely on our publication of them each month to calculate lump 
sum benefit amounts.
    Because of the need to provide immediate guidance for the payment 
of benefits under plans with valuation dates during May 2020, PBGC 
finds that good cause exists for making the assumptions set forth in 
this amendment effective less than 30 days after publication.
    PBGC has determined that this action is not a ``significant 
regulatory action'' under the criteria set forth in Executive Order 
12866.
    Because no general notice of proposed rulemaking is required for 
this amendment, the Regulatory Flexibility Act of 1980 does not apply. 
See 5 U.S.C. 601(2).

List of Subjects in 29 CFR Part 4022

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

    In consideration of the foregoing, 29 CFR part 4022 is amended as 
follows:

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

0
1. 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
2. In appendix B to part 4022, rate set 319 is added at the end of the 
table to read as follows:

Appendix B to Part 4022--Lump Sum Interest Rates for PBGC Payments

* * * * *

[[Page 20830]]



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                                                                    For plans with a valuation                                             Deferred annuities  (percent)
                                                                               date                  Immediate   -------------------------------------------------------------------------------
                            Rate set                             --------------------------------  annuity rate
                                                                    On or after       Before         (percent)           i               i               i               n               n
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                                          * * * * * * *
319.............................................................          5-1-20          6-1-20            0.50            4.00            4.00            4.00               7               8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


0
3. In appendix C to part 4022, rate set 319 is added at the end of the 
table to read as follows:

Appendix C to Part 4022--Lump Sum Interest Rates for Private-Sector 
Payments

* * * * *

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    For plans with a valuation                                             Deferred annuities  (percent)
                                                                               date                  Immediate   -------------------------------------------------------------------------------
                            Rate set                             --------------------------------  annuity rate
                                                                    On or after       Before         (percent)           i               i               i               n               n
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                                          * * * * * * *
319.............................................................          5-1-20          6-1-20            0.50            4.00            4.00            4.00               7               8
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    Issued in Washington, DC.
Hilary Duke,
Assistant General Counsel for Regulatory Affairs, Pension Benefit 
Guaranty Corporation.
[FR Doc. 2020-07763 Filed 4-14-20; 8:45 am]
BILLING CODE 7709-02-P