[Federal Register Volume 89, Number 116 (Friday, June 14, 2024)]
[Rules and Regulations]
[Pages 50526-50527]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-13047]


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PENSION BENEFIT GUARANTY CORPORATION

29 CFR Part 4044


Allocation of Assets in Single-Employer Plans; Interest 
Assumptions for Valuing 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 Allocation of Assets in Single-Employer 
Plans to prescribe interest assumptions under the asset allocation 
regulation for plans with valuation dates of July 1-July 30, 2024. 
These interest assumptions are used for valuing benefits under 
terminating single-employer plans and for other purposes.

DATES: Effective July 1, 2024.

FOR FURTHER INFORMATION CONTACT: Monica O'Donnell 
([email protected]), Attorney, Office of the General Counsel, 
Pension Benefit Guaranty Corporation, 445 12th Street SW, Washington, 
DC 20024-2101, 202-229-8706. If you are deaf or hard of hearing or have 
a speech disability, please dial 7-1-1 to access telecommunications 
relay services.

SUPPLEMENTARY INFORMATION: PBGC's regulation on Allocation of Assets in 
Single-Employer Plans (29 CFR part 4044) prescribes actuarial 
assumptions--including interest assumptions--for valuing benefits under 
terminating 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 posted on PBGC's website 
(www.pbgc.gov).
    PBGC uses the interest assumptions in appendix B to part 4044 
(``Interest Rates Used to Value Benefits'') to determine the present 
value of annuities in an involuntary or distress termination of a 
single-employer plan under the asset allocation regulation. The 
assumptions are also used to determine the value of multiemployer plan 
benefits and certain assets when a plan terminates by mass withdrawal 
in accordance with PBGC's regulation on Duties of Plan Sponsor 
Following Mass Withdrawal (29 CFR part 4281).
    The July 1-July 30, 2024 interest assumptions will be 5.11 percent 
for the first 20 years following the valuation date and 4.83 percent 
thereafter. In comparison with the interest assumptions in effect for 
the second quarter of 2024, these interest assumptions represent no 
change in the select period (the period during which the select rate 
(the initial rate) applies), a decrease of 0.39 percent in the select 
rate, and no change in the ultimate rate (the final rate).
    This final rule is the last rule that PBGC will publish for the 
interest assumption using the select and ultimate approach. On June 6, 
2024, PBGC issued a final rule at 89 FR 48291 that changes the 
structure of the interest assumption for valuation dates on or after 
July 31, 2024, from the select and ultimate approach to a yield curve 
approach. As described in the June 6 final rule, under the yield curve 
approach, the interest assumption is based on a blend of two publicly 
available yield curves that is adjusted to the extent necessary so that 
the resulting liabilities align with group annuity prices. PBGC will 
determine and publish those adjustments (i.e., ``spreads'') quarterly 
based on survey data on pricing of private-sector group annuities.

Need for Immediate Guidance

    PBGC has determined that notice of, and public comment on, this 
rule are impracticable, unnecessary, and contrary to the public 
interest. PBGC routinely updates the interest assumptions in appendix B 
of the asset allocation regulation each quarter so that they are 
available to value benefits. Accordingly, PBGC finds that the public 
interest is best served by issuing this rule expeditiously, without an 
opportunity for notice and comment, and 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 4044

    Employee benefit plans, Pension insurance, Pensions.

    In consideration of the foregoing, 29 CFR part 4044 is amended as 
follows:

PART 4044--ALLOCATION OF ASSETS IN SINGLE-EMPLOYER PLANS

0
1. The authority citation for part 4044 continues to read as follows:

    Authority:  29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.


[[Page 50527]]



0
2. In appendix B to part 4044, an entry for ``July 2024, other than 
July 31'' is added at the end of the table to read as follows:

Appendix B to Part 4044--Interest Rates Used to Value Benefits

* * * * *

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                                                                                               The values of i are:
      For valuation dates occurring in the month--       -----------------------------------------------------------------------------------------------
                                                                 i            for t =            i            for t =            i            for t =
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                                                                      * * * * * * *
July 2024, other than July 31...........................          0.0511            1-20          0.0483             >20             N/A             N/A
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    Issued in Washington, DC.
Gregory Katz,
Deputy Assistant General Counsel for Regulatory Affairs, Pension 
Benefit Guaranty Corporation.
[FR Doc. 2024-13047 Filed 6-13-24; 8:45 am]
BILLING CODE 7709-02-P