2010-18302. Submission of Information Collection for OMB Review; Comment Request; Payment of Premiums

AGENCY:

Pension Benefit Guaranty Corporation.

ACTION:

Notice of request for extension of OMB approval of revised collection of information.

SUMMARY:

The Pension Benefit Guaranty Corporation (PBGC) is modifying the collection of information under Part 4007 of its regulation on Payment of Premiums (OMB control number 1212-0007; expires February 28, 2011) and is requesting that the Office of Management and Budget (OMB) extend approval of the collection of information under the Paperwork Reduction Act for three years. This notice informs the public of PBGC's request and solicits public comment on the collection of information.

DATES:

Comments must be submitted by August 26, 2010.

ADDRESSES:

Comments should be sent to the Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Pension Benefit Guaranty Corporation, via electronic mail at [e-mail] or by fax to [phone].

Copies of the collection of information and PBGC's request may be obtained without charge by writing to the Disclosure Division, Office of General Counsel, 1200 K Street, NW., Washington, DC 20005-4026, or by visiting the Disclosure Division or calling 202-326-4040 during normal business hours. (TTY/TDD users may call the Federal relay service toll-free at 1-800-877-8339 and ask to be connected to 202-326-4040.) The premium payment regulation and the premium instructions (including illustrative forms) for 2010 and prior years can be accessed on PBGC's Web site at http://www.pbgc.gov.

FOR FURTHER INFORMATION CONTACT:

James Bloch, Program Analyst, Legislative and Policy Division, or Catherine B. Klion, Manager, Regulatory and Policy Division, Legislative and Regulatory Department, Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, DC 20005-4026; 202-326-4024. (TTY/TDD users may call the Federal relay service toll-free at 1-800-877-8339 and ask to be connected to 202-326-4024.)

SUPPLEMENTARY INFORMATION:

Section 4007 of Title IV of the Employee Retirement Income Security Act of 1974 (ERISA) requires pension plans covered under Title IV pension insurance programs to pay premiums to PBGC. Pursuant to section 4007, PBGC has issued its regulation on Payment of Premiums (29 CFR Part 4007). Under § 4007.3 of the premium payment regulation, plan administrators are required to file premium payments and information prescribed by PBGC. Premium information must be filed electronically using “My Plan Administration Account” (“My PAA”) through PBGC's Web site except to the extent PBGC grants an exemption for good cause in appropriate circumstances, in which case the information must be filed using an approved PBGC form. The plan administrator of each pension plan covered by Title IV of ERISA is required to submit one or more premium filings for each premium payment year. Under § 4007.10 of the premium payment regulation, plan administrators are required to retain records about premiums and information submitted in premium filings.

PBGC needs information from premium filings to identify the plans for which premiums are paid, to verify whether the amounts paid are correct, to help PBGC determine the magnitude of its exposure in the event of plan termination, to help track the creation of new plans and transfer of participants and plan assets and liabilities among plans, and to keep PBGC's insured-plan inventory up to date. That information and the retained records are also needed for audit purposes.

All plans covered by Title IV of ERISA pay a flat-rate per-participant premium. An underfunded single-employer plan also pays a variable-rate premium based on the value of the plan's unfunded vested benefits.

Large-plan filers (i.e., plans that were required to pay premiums for 500 or more participants for the prior plan year) are required to pay PBGC's flat-rate premium early in the premium payment year. Because the participant count often is not available until late in the premium payment year, PBGC permits filers to make an “Estimated flat-rate premium filing.”

All plans are required to make a “Comprehensive premium filing.” Comprehensive filings are used to report (i) the flat-rate premium and related data (all plans), (ii) the variable-rate premium and related data (single-employer plans), and (iii) additional data such as identifying information and miscellaneous plan-related or filing-related data (all plans). For large plans, the Comprehensive filing also serves to reconcile an estimated flat-rate premium paid earlier in the year.

PBGC intends to revise the 2011 filing instructions to:

• Remove references to a transition rule in section 430 of the Internal Revenue Code that no longer applies.
• Remove instructions about the credit card payment option for premium payments, which is being eliminated because of low usage.
• Clarify that if a plan has been frozen more than once, a filer should report the most recent date that the plan became closed to new entrants. These instructions parallel the benefit-accrual-freeze instructions.
• Make minor editorial changes.

PBGC intends to revise the 2012 filing instructions to require plans using the alternative premium funding target to report the “effective interest rate” (defined in section 430(h) of the Internal Revenue Code). PBGC will use this information to update its annual contingency list and financial statements more timely and accurately. PBGC is not making this change until 2012 to provide time to modify its premium accounting system to handle the new data element.

The collection of information under the regulation has been approved through February 28, 2011, by OMB under control number 1212-0007. PBGC is requesting that OMB extend approval of the collection of information, with modifications, for another three years. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

PBGC estimates that it will receive 34,300 premium filings per year from 28,500 plan administrators under this collection of information. PBGC further estimates that the average annual burden of this collection of information is 9,000 hours and $59,960,000.

Issued in Washington, DC, July 21, 2010.

John H. Hanley,

Director, Legislative and Regulatory Department, Pension Benefit Guaranty Corporation.