PBGC Proposes Changes to Reporting Requirements

The agency says funding relief prevents it from getting all information it needs to help plans.

The Pension Benefit Guaranty Corporation (PBGC) is proposing to amend its regulation on Annual Financial and Actuarial Information Reporting to codify provisions of the Moving Ahead for Progress in the 21st Century Act (MAP-21) and the Highway and Transportation and Funding Act of 2014 (HATFA).

The proposed changes would codify guidance that affect reporting under Employee Retirement Income Security Act (ERISA) section 4010 provided in Technical Updates 12-2 and 14-2, and would make some technical changes. The proposal would also add reporting waivers for certain plans.

In its proposal, the PBGC says the current regulation does not allow it to access important available information about plans that present substantial risk and exposure to the pension insurance system. The agency is not receiving data in 4010 filings that it would otherwise receive because plans that were never intended to qualify for a regulatory waiver are, in fact, qualifying as a result of MAP-21 and HATFA funding relief.

Current regulations provide a waiver from reporting if the aggregate underfunding of pension plans in a controlled group does not exceed $15 million. PBGC says it is not receiving information from approximately 200 controlled groups for which 4010 reporting was required before MAP-21 and HATFA.

The agency is proposing to limit the availability of the $15 million aggregate underfunding waiver to controlled groups for which the aggregate number of participants in all defined benefit plans maintained by the controlled group is fewer than 500.

PBGC says this threshold would be similar to an exemption under section 4010.8(c) for plans with fewer than 500 participants from providing section 4010.11 actuarial information in a 4010 report. 

The agency is specifically requesting public comment about whether using a different participant count threshold or tying the $15 million aggregate underfunding waiver directly to non-stabilized rates would be more appropriate.

Text of the proposed rule is here.