[Federal Register: December 1, 2006 (Volume 71, Number 231)]
[Notices]
[Page 69602-69603]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01de06-119]

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PENSION BENEFIT GUARANTY CORPORATION


PBGC Flat Premium Rates

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Notice of flat premium rates.

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SUMMARY: This notice informs the public of the PBGC flat premium rates
for premium payment years beginning in 2007. These rates can be derived
from information published elsewhere but are published in this notice
for the convenience of the public.

DATES: The flat premium rates apply to premium payment years beginning
in 2007.

FOR FURTHER INFORMATION CONTACT: Catherine B. Klion, Manager,
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-
4024.)

SUPPLEMENTARY INFORMATION: The 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)
amends section 4006 of ERISA. DRA 2005 changes 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
provides 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 2007, the 2005 index is compared to the
baseline (the 2004 index). The new provisions are 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 2005 index is $36,952.94. The ratio of the 2005 index
to the 2004 index is 1.03659. Multiplying this ratio by $30.00 gives
$31.10 which rounds to $31.00. Multiplying the ratio by $8.00 gives
$8.29, which rounds to $8.00. Thus, the 2007 flat premium rates for
PBGC's two insurance programs will be $31.00 per participant for
single-employer plans and $8.00 per participant for multiemployer
plans.
    The PBGC will publish the flat premium rates annually for the
convenience of the public.


[[Page 69603]]


    Issued in Washington, DC, on this 17th day of November 2006.
Vincent K. Snowbarger,
Interim Director, Pension Benefit Guaranty Corporation.
 [FR Doc. E6-20386 Filed 11-30-06; 8:45 am]

BILLING CODE 7709-01-P