[Federal Register Volume 59, Number 83 (Monday, May 2, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-10411]
[[Page Unknown]]
[Federal Register: May 2, 1994]
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PENSION BENEFIT GUARANTY CORPORATION
Request for Approval of a New Collection of Information Under the
Paperwork Reduction Act; Survey of Firms With Significant Pension Plan
Underfunding
AGENCY: Pension Benefit Guaranty Corporation.
ACTION: Notice of request for OMB approval.
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SUMMARY: The Pension Benefit Guaranty Corporation (``PBGC'') has
requested that the Office of Management and Budget approve, under the
Paperwork Reduction Act, a survey of companies maintaining single-
employer pension plans with significant underfunding (in the aggregate)
that requests verification (or correction) and supplementation of
information otherwise available to the PBGC. The purpose of this
voluntary collection of information is to improve the accuracy and
completeness of information obtained from other sources and used in
various agency efforts (e.g., estimating potential liability for future
benefits, selecting plans for monitoring, responding to congressional
inquiries, and identifying for the public the companies with the
largest levels of pension underfunding). The effect of this notice is
to advise the public of the PBGC's request and solicit public comment
on this collection of information.
ADDRESSES: All written comments (at least three copies) should be
addressed to Office of Management and Budget, Paperwork Reduction
Project (1212-0040), Washington, DC 20503. The PBGC's request for
approval will be available for inspection at the PBGC's Communications
and Public Affairs Department, suite 240, 1200 K Street, NW.,
Washington, DC 20005-4026, between 9 a.m. and 4 p.m., Monday through
Friday.
FOR FURTHER INFORMATION CONTACT:
Judith Neibrief, Attorney, Office of the General Counsel, Pension
Benefit Guaranty Corporation, 1200 K Street, NW., Washington, DC 20005-
4026, 202-326-4024 (202-326-4179 for TTY and TDD). (These are not toll-
free numbers.)
SUPPLEMENTARY INFORMATION: The Pension Benefit Guaranty Corporation
(``PBGC'') administers the pension plan termination insurance programs
under Title IV of the Employee Retirement Income Security Act of 1974
(``ERISA'') (29 U.S.C. 1001 et seq.). Since the early 1980's, the PBGC
has undertaken a number of steps to address concerns about the
potential vulnerability of the single-employer insurance program to
large claims. In particular, the agency has sought to increase the
availability and quality of the information on pension plan
underfunding that it uses in estimating the potential exposure of the
single-employer termination insurance program, developing legislative
and other policy initiatives, selecting plans for monitoring and other
regulatory purposes, responding to congressional inquiries, and
educating the public.
PBGC experience revealed problems with using information otherwise
available to the agency unless it is reviewed by the companies
responsible for funding single-employer plans. In 1990, when the PBGC
decided to publish a Top 50 List of firms with the largest pension
underfunding (and, hence, in the aggregate, the largest potential
claims against the single-employer plan insurance program), it selected
the companies to be listed by adjusting otherwise available data (to
make the figures as consistent as possible across plans and reflect
Title IV liabilities). After receiving company complaints about
inaccuracies, the PBGC adopted their suggestion that, in the future,
the PBGC contact companies for needed information.
The primary reason that information available from other sources is
not adequate is that assumptions differ across plans and from those of
the PBGC and includes insufficient detail to enable the PBGC to make
appropriate adjustment (e.g., adjustments to common interest rate and
mortality assumptions). In addition, much of the information otherwise
available is over one and one-half years old by the time it is required
to be reported.
The survey conducted in compiling the Top 50 List has demonstrated
the usefulness of this technique in fulfilling various agency
responsibilities. The collection of information for which the PBGC now
is seeking OMB approval would replace it and solicit essentially the
same information.
If approved, this voluntary collection of information will request
responses to several items of plan funding information from companies
that, based on corporate annual reports, pension plan annual reports
(Form 5500 filings), and premium declarations (PBGC Form 1 filings),
appear to have significant pension plan underfunding. The PBGC
anticipates that its significant pension underfunding criterion of $25
million or more (in the aggregate) will result in a survey population
of about 300 to 350 companies. Specifically, the PBGC will send each
company a letter informing it of data that the PBGC has on benefits and
assets of single-employer plans covered by Title IV of ERISA and asking
the company to verify (or correct) these data and to provide
information on the interest and mortality assumptions used to value
plan benefits. At their option, respondents may choose also to provide
information on guaranteed benefits and actions taken to improve pension
funding. (In particular, companies will be given the option of
providing documentation of pension contributions made by September 15
of each year so that the PBGC may include such contributions in the
final value of pension plan assets.) Two simple forms will be included
for the company's response.
If approved, the PBGC will use responses to the survey to improve
the accuracy and completeness of information obtained from other
sources and used in various agency efforts, including estimating the
potential exposure of the single-employer termination insurance
program, legislative and other policy analyses, selecting plan for
monitoring, responding to congressional requests for information on
companies whose plans are significantly underfunded, and identifying
for the public the companies with the largest levels of underfunding
under covered plans (including the amount of underfunding by company).
The PBGC expects to survey 300 to 350 companies, for an average of
325 annually. Assuming that 90% of those surveyed will choose to
respond (even though this collection of information is voluntary) and
15% of those surveyed will elect to calculate guaranteed benefits, the
PBGC estimates the time needed to respond to the survey at 5 hours for
those that locate and assemble existing information (including, at
their option, documentation of additional pension contributions or
information on other actions to improve future funding) and review the
PBGC's adjustments and at 15 hours (i.e., an additional 10 hours) for
those that also calculate guaranteed benefits, for an average response
time of 6.67 hours per respondent and a total annual burden of 1,950
hours.
Issued in Washington, DC this 25th day of April, 1994.
Martin Slate,
Executive Director, Pension Benefit Guaranty Corporation.
[FR Doc. 94-10411 Filed 4-29-94; 8:45 am]
BILLING CODE 7708-01-M
