Federal Register, Volume 82 Issue 19 (Tuesday, January 31, 2017)
[Federal Register Volume 82, Number 19 (Tuesday, January 31, 2017)]
[Rules and Regulations]
[Pages 8813-8814]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-01074]
-----------------------------------------------------------------------
PENSION BENEFIT GUARANTY CORPORATION
29 CFR Parts 4071 and 4302
RIN 1212-AB33
Adjustment of Civil Penalties
AGENCY: Pension Benefit Guaranty Corporation.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Pension Benefit Guaranty Corporation is required to amend
its regulations annually to adjust the penalties provided for in
sections 4071 and 4302 of the Employee Retirement Income Security Act
of 1974. This action is being taken in accordance with the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and
Office of Management and Budget memorandum M-17-11. The regulations
being amended are those on Penalties for Failure to Provide Certain
Notices or Other Material Information and Penalties for Failure to
Provide Certain Multiemployer Plan Notices.
DATES: Effective date: This rule is effective on January 31, 2017.
Applicability date: The increases in the civil monetary penalties
under sections 4071 and 4302 provided for in this rule apply to such
penalties assessed after January 31, 2017.
FOR FURTHER INFORMATION CONTACT: Stephanie Cibinic, Deputy Assistant
General Counsel for Regulatory Affairs (cibinic.stephanie@pbgc.gov),
Office of the General Counsel, Pension Benefit Guaranty Corporation,
1200 K Street NW., Washington, DC 20005-4026; 202-326-4400 extension
6352. (TTY and TDD users may call the Federal relay service toll-free
at 800-877-8339 and ask to be connected to 202-326-4400 extension
6352.)
SUPPLEMENTARY INFORMATION:
Executive Summary
Purpose of the Regulatory Action
This rule is needed to carry out the requirements of the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015. The
rule finalizes the 2016 interim final regulations required under the
2015 act and further adjusts, as required for 2017, the maximum civil
penalties that PBGC may assess for failure to provide certain notices
or other material information.
PBGC's legal authority for this action comes from the Federal Civil
Penalties Inflation Adjustment Act of 1990 as amended by the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and
from sections 4002(b)(3), 4071, and 4302 of the
[[Page 8814]]
Employee Retirement Income Security Act of 1974.
Major Provisions of the Regulatory Action
This rule adjusts as required by law the maximum civil penalties
that PBGC may assess under sections 4071 and 4302 of ERISA. The new
maximum amounts are $2,097 for section 4071 penalties and $279 for
section 4302 penalties.
Background
The Pension Benefit Guaranty Corporation (PBGC) administers title
IV of the Employee Retirement Income Security Act of 1974 (ERISA).
Title IV has two provisions that authorize PBGC to assess civil
monetary penalties.\1\ Section 4302, added to ERISA by the
Multiemployer Pension Plan Amendments Act of 1980, authorizes PBGC to
assess a civil penalty of up to $100 a day for failure to provide a
notice under subtitle E of title IV of ERISA (dealing with
multiemployer plans). Section 4071, added to ERISA by the Omnibus
Budget Reconciliation Act of 1987, authorizes PBGC to assess a civil
penalty of up to $1,000 a day for failure to provide a notice or other
material information under subtitles A, B, and C of title IV and
sections 303(k)(4) and 306(g)(4) of title I of ERISA.
---------------------------------------------------------------------------
\1\ Under the Federal Civil Penalties Inflation Adjustment Act
of 1990, a penalty is a civil monetary penalty if (among other
things) it is for a specific monetary amount or has a maximum amount
specified by Federal law. Title IV also provides (in section 4007)
for penalties for late payment of premiums, but those penalties are
neither in a specified amount nor subject to a specified maximum
amount.
---------------------------------------------------------------------------
Adjustment of Civil Penalties
On November 2, 2015, the President signed into law the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015,\2\
which requires agencies to adjust civil monetary penalties for
inflation and to publish the adjustments in the Federal Register. An
initial adjustment was required to be made by interim final rule
published by July 1, 2016, and effective by August 1, 2016. Subsequent
adjustments must be promulgated in January each year after 2016. In an
interim final rule published on May 13, 2016 (at 81 FR 29765), PBGC
adjusted the maximum penalty under section 4071 to $2,063 and adjusted
the maximum penalty under section 4302 to $275.\3\
---------------------------------------------------------------------------
\2\ Sec. 701, Public Law 114-74, 129 Stat. 599-601 (Bipartisan
Budget Act of 2015).
\3\ The Office of Management and Budget issued memorandum M-16-
06 on implementation of the 2015 act, including multipliers to use
in the initial adjustment.
---------------------------------------------------------------------------
On December 16, 2016, the Office of Management and Budget issued
memorandum M-17-11 on implementation of the 2017 annual adjustment
pursuant to the 2015 act.\4\ The memorandum provides agencies with the
cost-of-living adjustment multiplier for 2017, which is based on the
Consumer Price Index (CPI-U) for the month of October 2016, not
seasonally adjusted. The multiplier for 2017 is 1.01636. The memorandum
also provides guidance to agencies on finalizing their 2016 interim
final rules. Accordingly, PBGC is adopting the 2016 interim final rule
with a change to the maximum penalty amount for 2017 as required by the
2015 act and Office of Management and Budget memorandum M-17-11. The
adjusted maximum amounts are $2,097 for section 4071 penalties and $279
for section 4302 penalties.
---------------------------------------------------------------------------
\4\ https://www.whitehouse.gov/sites/default/files/omb/memoranda/2017/m-17-11_0.pdf.
---------------------------------------------------------------------------
Compliance With Regulatory Requirements
The Office of Management and Budget has determined that this rule
is not a ``significant regulatory action'' under Executive Order 12866
and therefore not subject to their review.
The Office of Management and Budget also has determined that notice
and public comment on this final rule are unnecessary because the
adjustment of civil penalties implemented in the rule is required by
law. See 5 U.S.C. 553(b).
Because no general notice of proposed rulemaking is required for
this rule, the Regulatory Flexibility Act of 1980 does not apply. See 5
U.S.C. 601(2).
List of Subjects
29 CFR Part 4071
Penalties.
29 CFR Part 4302
Penalties.
In consideration of the foregoing, the interim final rule, which
was published at 81 FR 29765 on May 13, 2016, is adopted as a final
rule with the following changes:
PART 4071--PENALTIES FOR FAILURE TO PROVIDE CERTAIN NOTICES OR
OTHER MATERIAL INFORMATION
0
1. The authority citation for part 4071 continues to read as follows:
Authority: 28 U.S.C. 2461 note, as amended by sec. 701, Pub. L.
114-74, 129 Stat. 599-601; 29 U.S.C. 1302(b)(3), 1371.
Sec. 4071.3 [Amended]
0
2. In Sec. 4071.3, the figures ``; $2,063'' are removed and the
figures ``$2,097'' are added in their place.
PART 4302--PENALTIES FOR FAILURE TO PROVIDE CERTAIN MULTIEMPLOYER
PLAN NOTICES
0
3. The authority citation for part 4302 continues to read as follows:
Authority: 28 U.S.C. 2461 note, as amended by sec. 701, Pub. L.
114-74, 129 Stat. 599-601; 29 U.S.C. 1302(b)(3), 1452.
Sec. 4302.3 [Amended]
0
4. In Sec. 4302.3, the figures ``$275'' are removed and the figures
``$279'' are added in their place.
Issued in Washington, DC.
W. Thomas Reeder,
Director, Pension Benefit Guaranty Corporation.
[FR Doc. 2017-01074 Filed 1-30-17; 8:45 am]
BILLING CODE 7709-02-P
