PBGC penalty structure comment letter

July 1, 2004 VIA EMAIL Office of the General Counsel Pension Benefit Guaranty Corporation 1200 K Street NW Washington, DC 20005-4026 Re: Comment letter on proposed new penalty structure for failure to issue participant notices required under Section 4011 of ERISA Dear PBGC: The American Benefits Council (the Council) appreciates the opportunity to comment on the proposed new penalty structure for failure to issue participant notices required under Section 4011 of the Employee Retirement Income Security Act of 1974, as amended (ERISA), and would like to commend the Pension Benefit Guaranty Corporation (PBGC) for its efforts to ensure that the penalty corresponds to the significance of the failure in order to be more effective. However, the Council is concerned that basing the penalty on the number of participants in a plan without any allowances for inadvertent errors (that do not qualify for a reasonable cause waiver) or comparisons to the variable rate premiums (VRP) actually owed by the plan would result in onerous penalties for many large plans. The Council is a public policy organization dedicated to the employee benefit plan system, representing sponsors of retirement and health plans and service providers to those plans. Collectively, the Council’s members help provide benefits to more than 100 million participants. Many of our members are sponsors of large plans and the Council appreciates the opportunity to make their ...