Submission of Information Collection for OMB Review; Comment Request; Annual Reporting (Form 5500 Series)

Agency: "Pension Benefit Guaranty Corporation."

SUMMARY: The Pension Benefit Guaranty Corporation (PBGC) is requesting that the Office of Management and Budget (OMB) extend approval, with modifications, under the Paperwork Reduction Act of 1995, of its collection of information for Annual Reporting. This notice informs the public of PBGC's request and solicits public comment on the collection.

DATES: Comments must be submitted by December 13, 2019.

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 [email protected] or by fax to (202) 395-6974.

A copy of the request will be posted on PBGC's website at: https://www.pbgc.gov/prac/laws-and-regulations/information-collections-under-omb-review. It may also be obtained without charge by writing to the Disclosure Division of the Office of the General Counsel of PBGC, 1200 K Street NW, Washington, DC 20005-4026; faxing a request to 202-326-4042; or, calling 202-326-4040 during normal business hours (TTY users may call the Federal Relay Service toll-free at 800-877-8339 and ask to be connected to 202-326-4040). The Disclosure Division will email, fax, or mail the information to you, as you request.

FOR FURTHER INFORMATION CONTACT: Karen Levin ([email protected]), Attorney, Regulatory Affairs Division, Office of the General Counsel, Pension Benefit Guaranty Corporation, 1200 K Street NW, Washington, DC 20005-4026, 202 229-3559. TTY users may call the Federal Relay Service toll-free at 800-877-8339 and ask to be connected to 202-229-3559.

SUPPLEMENTARY INFORMATION: Annual reporting to the Internal Revenue Service (IRS), the Employee Benefits Security Administration (EBSA), and the Pension Benefit Guaranty Corporation (PBGC) is required by law for most employee benefit plans. For example, section 4065 of the Employee Retirement Income Security Act of 1974 (ERISA) requires annual reporting to PBGC for pension plans covered by title IV of ERISA. To accommodate these filing requirements, IRS, EBSA and PBGC have jointly promulgated the Form 5500 Series, which includes the Form 5500 Annual Return/Report of Employee Benefit Plan and the Form 5500-SF Short Form Annual Return/Report of Small Employee Benefit Plan.

PBGC is proposing modifications to the 2020 Schedule R (Retirement Plan Information) and its related instructions. Schedule R is part of the Form 5500 Series. The proposed modifications to Schedule R affect multiemployer defined benefit plans covered by title IV of ERISA. PBGC also is proposing minor modifications to the Form 5500 Series to improve the accuracy of reported information. The modifications are described in greater detail in the supporting statement submitted to OMB with this information collection, along with PBGC's rationale for each modification.

Section 103(f)(2)(C) of ERISA requires that a multiemployer defined benefit plan include in its annual report, "[t]he number of participants under the plan on whose behalf no contributions were made by an employer as an employer of the participant for such plan year and for each of the 2 preceding plan years." Line 14a of Schedule R requires the plan to report the inactive participant counts for the current plan year's filing. Lines 14b and 14c require the plan to report the inactive participant counts for the previous two respective plan years. PBGC has found a majority of plans that are required to report do not provide accurate information on line 14 of Schedule R.

The current instructions for line 14 require multiemployer plans to count inactive participants using the last contributing employer counting method. Under the last contributing employer method, a plan counts only those inactive participants whose last contributing employer withdrew from the plan by the beginning of the relevant plan year for which the Form 5500 relates. The plan does not count any inactive participants whose employers had not withdrawn from the plan.

PBGC is proposing to modify Schedule R to provide multiemployer plans with a choice of the last contributing employer counting method and two other proposed counting methods: The alternative method and the reasonable approximation method. PBGC anticipates that providing plans with three available counting methods will allow each plan to choose the counting method that will be most accurate and least burdensome for the plan to count its inactive participants.

Under the alternative method, a plan would count only those inactive participants whose last contributing employer and all prior contributing employers had withdrawn from the plan by the beginning of the relevant plan year. Under this method, the plan would review the list of all contributing employers (employers that had not withdrawn from the plan by the beginning of the relevant plan year), and include on Line 14 only those inactive participants who had no covered service with any of these employers.

Under the reasonable approximation method, a plan that is unable to use the other two counting methods must make a reasonable, good faith effort to count inactive participants to satisfy the requirements of section 103(f)(2)(C) of ERISA. The plan would also be required to provide an attachment that explains the plan's approximation method, including a description of the data and a breakdown describing the number of clearly identified inactive participants and the number of estimated inactive participants.

PBGC is also proposing that when a plan reports a number on line 14b or 14c that differs from the number it reported for the plan year immediately preceding the current plan year, it would be required to submit an attachment with an explanation of the reason for the change.

Both attachments will provide PBGC with data to be used in its Pension Insurance Modeling System (PIMS). PBGC's evaluation of the data submitted in the attachments will allow PBGC to review the integrity of the data. PBGC estimates that the proposed changes would have an offsetting effect and would not change the hour or cost burden for the Schedule R.

The existing collection of information was approved under OMB control number 1212-0057 (expires January 31, 2022). On August 20, 2019, PBGC published in the Federal Register (at 84 FR 43189) a notice informing the public of its intent to request an extension of this collection of information, as modified. PBGC received one comment in support of the collection of information. PBGC is requesting that OMB extend approval of the collection, with modifications, for 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 approximately 24,800 Form 5500 and Form 5500-SF filings per year under this collection of information. PBGC further estimates that the total annual burden of this collection of information for PBGC will be 1,200 hours and $1,664,000.

Issued in Washington, DC, by

Hilary Duke,

Assistant General Counsel for Regulatory Affairs, Pension Benefit Guaranty Corporation.

Notice of request for extension of OMB approval, with modifications.

Citation: "84 FR 61658"

Federal Register Page Number: "61658"

"Notices"