Rule2023-19803
Allocation of Assets in Single-Employer Plans; Interest Assumptions for Valuing Benefits
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 13, 2023
Effective
October 1, 2023
Issuing agencies
Pension Benefit Guaranty Corporation
Abstract
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 in the fourth quarter of 2023. These interest assumptions are used for valuing benefits under terminating single-employer plans and for other purposes.
Full Text
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<title>Federal Register, Volume 88 Issue 176 (Wednesday, September 13, 2023)</title>
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[Federal Register Volume 88, Number 176 (Wednesday, September 13, 2023)]
[Rules and Regulations]
[Page 62706]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-19803]
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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 in the fourth quarter of
2023. These interest assumptions are used for valuing benefits under
terminating single-employer plans and for other purposes.
DATES: Effective October 1, 2023.
FOR FURTHER INFORMATION CONTACT: Gregory Katz (<a href="/cdn-cgi/l/email-protection#553e34212f7b322730323a272c15253732367b323a23"><span class="__cf_email__" data-cfemail="63080217194d041106040c111a23130104004d040c15">[email protected]</span></a>),
Attorney, Office of the General Counsel, Pension Benefit Guaranty
Corporation, 445 12th Street SW, Washington, DC 20024-2101, 202-229-
3829. 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 published on PBGC's website
(<a href="https://www.pbgc.gov">https://www.pbgc.gov</a>).
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 fourth quarter 2023 interest assumptions will be 5.06 percent
for the first 20 years following the valuation date and 4.37 percent
thereafter. In comparison with the interest assumptions in effect for
the third quarter of 2023, these interest assumptions represent no
change in the select period (the period during which the select rate
(the initial rate) applies), a decrease of 0.18 percent in the select
rate, and a decrease of 0.21 percent in the ultimate rate (the final
rate).
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 to allow the use of the proper assumptions to
estimate the value of plan benefits for plans with valuation dates
early in the fourth quarter of 2023.
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
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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.
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2. In appendix B to part 4044, an entry for ``October-December 2023''
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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* * * * * * *
October-December 2023....... 0.0506 1-20 0.0437 >20 N/A N/A
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Issued in Washington, DC.
Hilary Duke,
Assistant General Counsel for Regulatory Affairs, Pension Benefit
Guaranty Corporation.
[FR Doc. 2023-19803 Filed 9-12-23; 8:45 am]
BILLING CODE 7709-02-P
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