2010-21197. Regulations Governing Agencies for Issue of United States Savings Bonds; Offering of United States Savings Bonds, Series EE; Regulations Governing Definitive United States Savings Bonds, Series EE and HH; Offering of United States ...

AGENCY:

Bureau of the Public Debt, Fiscal Service, Treasury.

ACTION:

Final rule.

SUMMARY:

Treasury is discontinuing the issuance of definitive (paper) savings bonds through payroll savings plans.

DATES:

Effective Date: The amendments to 31 CFR 351.47 and 31 CFR 359.35 are effective on October 1, 2010; all other amendments are effective on January 1, 2011.

ADDRESSES:

You can download this Final Rule at the following Internet addresses: http://www.publicdebt.treas.gov, http://www.gpo.gov, or http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT:

Elisha Whipkey, Director, Division of Program Administration, Office of Retail Securities, Bureau of the Public Debt, at [phone] or [e-mail].

Ann Fowler, Attorney-Adviser, Susan Sharp, Attorney-Adviser, Dean Adams, Assistant Chief Counsel, Edward Gronseth, Deputy Chief Counsel, Office of the Chief Counsel, Bureau of the Public Debt, at [phone] or [e-mail].

SUPPLEMENTARY INFORMATION:

United States Savings Bonds are non-marketable Treasury securities which have been sold continuously since March 1935. Savings bonds were introduced as a means of encouraging broad public participation in government financing by making Treasury securities available in small denominations specially tailored to the small investor. Today, savings bonds continue to be an important savings and investment tool for individuals, and Treasury is committed to offering savings bonds to the public as efficiently as possible.

In order to reduce costs, to increase the reliability and security of transactions by moving from paper to electronics, and to minimize the Treasury's impact on the environment, Treasury is discontinuing the issuance of definitive (paper) savings bonds through payroll savings plans. Treasury will eliminate the option to purchase paper savings bonds through payroll deductions for United States government employees on October 1, 2010, and for all other employees on January 1, 2011. This policy covers only paper savings bonds purchased through payroll sales; individuals will still be able to purchase paper savings bonds at financial institutions for themselves and as gifts. Payroll savers will be encouraged to continue their purchases through TreasuryDirect®, a web-based system that allows investors to buy and hold electronic savings bonds. Transitioning employees to electronic payroll purchases saves employers administrative costs and allows employees to manage their own savings bond accounts.

Procedural Requirements

Executive Order 12866. This rule is not a significant regulatory action pursuant to Executive Order 12866.

Administrative Procedure Act (APA). Because this rule relates to United States securities, which are contracts between Treasury and the owner of the security, this rule falls within the contract exception to the APA, 5 U.S.C. 553(a)(2). As a result, the notice, public comment, and delayed effective date provisions of the APA are inapplicable to this rule.

Regulatory Flexibility Act. The provisions of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., do not apply to this rule because, pursuant to 5 U.S.C. 553(a)(2), it is not required to be issued with notice and opportunity for public comment.

Paperwork Reduction Act (PRA). There is no new collection of information contained in this final rule that would be subject to the PRA, 44 U.S.C. 3501 et seq. Under the PRA, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid Office of Management and Budget control number. The Office of Management and Budget already has approved all collections of information in 31 CFR Part 353 (OMB No. 1535-0009, 1535-0023, 1535-0063) and Part 359 (OMB No. 1535-0111).

Congressional Review Act (CRA). This rule is not a major rule pursuant to the CRA, 5 U.S.C. 801 et seq., because it is a minor amendment that is expected to decrease costs for taxpayers and for employers; therefore, this rule is not expected to lead to any of the results listed in 5 U.S.C. 804(2). This rule may take immediate effect after we submit a copy of it to Congress and the Comptroller General.

List of Subjects

31 CFR Part 317

• Bonds
• Electronic funds transfers
• Federal Reserve System
• Government securities
• Securities

31 CFR Part 351

• Bonds
• Federal Reserve System
• Government securities

31 CFR Part 353

• Banks and banking
• Government securities
• Federal Reserve system

31 CFR Part 359

• Bonds
• Federal Reserve system
• Government securities
• Securities

Accordingly, for the reasons set out in the preamble, 31 CFR Chapter II, Subchapter B, is amended as follows:

PART 317—REGULATIONS GOVERNING AGENCIES FOR ISSUE OF UNITED STATES SAVINGS BONDS.

1. Revise the authority citation for part 317 to read as follows:

Authority: 5 U.S.C. 301; 12 U.S.C. 391; 12 U.S.C. 1767; and 31 U.S.C. 3105.

2. Amend § 317.1 by revising paragraph (c)(2) to read as follows:

§ 317.1

Definitions.

* * * * *

(c) * * *

(2) Each organization that is authorized to inscribe bonds sold over-the-counter.

* * * * *

§ 317.2

[Amended]

3. Amend § 317.2 by removing paragraph (c), and redesignating paragraph (d) as paragraph (c).

4. Amend § 317.3(a) by revising the second sentence to read as follows:

§ 317.3

Procedure for qualifying and serving as issuing agent.

(a) * * * However, if an organization seeks qualification under § 317.2(c), it shall make application directly to the Bureau of the Public Debt for approval by the Commissioner of the Bureau of the Public Debt. * * *

* * * * *

5. Amend § 317.7 by revising the first sentence to read as follows:

§ 317.7

Obtaining and accounting for bond stock.

An issuing agent that is authorized to inscribe bonds sold over-the-counter may obtain bond stock from the designated Federal Reserve Bank. * * *

§ 317.8

[Amended]

6. In § 317.8, remove the Appendix to § 317.8.

PART 351—OFFERING OF UNITED STATES SAVINGS BONDS, SERIES EE

7. The authority citation for part 351 continues to read as follows:

Authority: 5 U.S.C. 301; 12 U.S.C. 391; 31 U.S.C. 3105.

§ 351.46

[Amended]

8. Amend § 351.46 by removing footnote 2.

9. Revise § 351.47 to read as follows:

§ 351.47

May I purchase definitive Series EE savings bonds through a payroll savings plan?

Treasury discontinued the issuance of definitive Series EE savings bonds through a payroll savings plan:

(a) Effective October 1, 2010, for United States government employees, and

(b) Effective January 1, 2011, for all other employees.

§ 351.70

[Amended]

10. Amend § 351.70 by redesignating footnote 3 as footnote 2.

PART 353—REGULATIONS GOVERNING DEFINITIVE UNITED STATES SAVINGS BONDS, SERIES EE AND HH

11. The authority citation for part 353 continues to read as follows:

Authority: 5 U.S.C. 301; 12 U.S.C. 391; 31 U.S.C. 3105, 3125.

12. Amend § 353.6 by:

a. Redesignating paragraph (d) as paragraph (e);

b. Redesignating paragraph (c) as paragraph (d);

c. Redesignating paragraph (b)(4) as paragraph (c) and revising it to read as follows:

§ 353.6

Restrictions on registration.

* * * * *

(c) Nonresident aliens. A nonresident alien may be designated co-owner or beneficiary or, on authorized reissue, owner, unless the nonresident alien is a resident of an area with respect to which the Department of the Treasury restricts or regulates the delivery of checks drawn against funds of the United States or its agencies or instrumentalities. See Department of the Treasury Circular No. 655, current revision (31 CFR part 211). Registration is not permitted in any form which includes the name of any alien who is a resident of any restricted area.

* * * * *

PART 359—OFFERING OF UNITED STATES SAVINGS BONDS, SERIES I

13. The authority citation for part 359 continues to read as follows:

Authority: 5 U.S.C. 301; 12 U.S.C. 391; 31 U.S.C. 3105.

§ 359.34

[Amended]

14. Amend § 359.34 by removing footnote 4.

15. Revise § 359.35 to read as follows:

§ 359.35

May I purchase definitive Series I savings bonds through a payroll savings plan?

Treasury discontinued the issuance of definitive Series I savings bonds through a payroll savings plan:

(a) Effective October 1, 2010, for United States government employees, and

(b) Effective January 1, 2011, for all other employees.

§ 359.55

[Amended]

16. Amend § 359.55 by redesignating footnote 5 as footnote 4.

Richard L. Gregg,

Fiscal Assistant Secretary.