[Federal Register: December 1, 2009 (Volume 229, Number 74)]


[Page 62842]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]






PBGC Flat Premium Rates

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Notice regarding flat premium rates.


SUMMARY: This notice informs the public of the PBGC flat premium rates 

for premium payment years beginning in 2010 and announces that PBGC 

will no longer publish annual flat premium rate notices in the Federal 

Register. These rates can be derived from information published 

elsewhere and are published by PBGC on its Web site (http://


DATES: The flat premium rates announced in this notice apply to premium 

payment years beginning in 2010.


Regulatory and Policy Division, Legislative and Regulatory Department, 

Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, 

DC 20005, 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-


SUPPLEMENTARY INFORMATION: Pension Benefit Guaranty Corporation (PBGC) 

administers the pension plan termination insurance program under Title 

IV of the Employee Retirement Income Security Act of 1974 (ERISA). 

Pension plans covered by Title IV must pay premiums to PBGC. Section 

4006 of ERISA deals with premium rates.

    The Deficit Reduction Act of 2005 (Pub. L. 109-171) (DRA 2005) 

amended section 4006 of ERISA. DRA 2005 changed the per-participant 

flat premium rate for plan years beginning in 2006 from $19 to $30 for 

single-employer plans and from $2.60 to $8 for multiemployer plans and 

provided for inflation adjustments to the flat rates for future years. 

The adjustments are based on changes in the national average wage index 

as defined in section 209(k)(1) of the Social Security Act, with a two-

year lag--for example, for 2010, the 2008 index is compared to the 

baseline (the 2004 index). The provisions were written in such a way 

that the premium rate can never go down; if the change in the national 

average wage index is negative, the premium rate remains the same as in 

the preceding year. Also, premium rates are rounded to the nearest 

whole dollar.

    The baseline national average wage index, the 2004 index, was 

$35,648.55. The 2008 index is $41,334.97. The ratio of the 2008 index 

to the 2004 index is 1.1595134. Multiplying this ratio by $30.00 gives 

$34.79, which rounds to $35.00. Multiplying the ratio by $8.00 gives 

$9.28, which rounds to $9.00. Thus, the 2010 flat premium rates for 

PBGC's two insurance programs will be $35.00 per participant for 

single-employer plans and $9.00 per participant for multiemployer 


    Before DRA 2005, PBGC flat premium rates remained constant for many 

years at a time. Since DRA 2005, PBGC has published annual notices 

(like this one) in the Federal Register to inform the public of the 

rates. PBGC also publishes the flat rates in its annual premium 

instructions on its Web site (http://www.pbgc.gov; click on 

``Practitioners,'' then on ``Premium Instructions and Forms'' under the 

heading ``Premium Filings'' in the center column). PBGC has concluded 

that since the flat rates are easily accessible to the public on its 

Web site, it is no longer necessary to publish annual flat premium rate 

notices in the Federal Register.

    Issued in Washington, DC, on this 13th day of November 2009.

Vincent K. Snowbarger,

Acting Director, Pension Benefit Guaranty Corporation.

[FR Doc. E9-28640 Filed 11-30-09; 8:45 am]