Page:United States Statutes at Large Volume 101 Part 2.djvu/1152

 101 STAT. 1330-358

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Regulations.

PUBLIC LAW 100-203—DEC. 22, 1987 "(i) IN GENERAL.—If any rate of interest used under the plan to determine cost is not within the permissible range, the plan shall establish a new rate of interest within the permissible range. "(ii) PERMISSIBLE RANGE.—For purposes of this subparagraph— "(I) IN GENERAL.—Except as provided in subclause (II), the term 'permissible range' means a rate of interest which is not more than 10 percent above, and not more than 10 percent below, the weighted average of the rates of interest on 30year Treasury securities during the 4-year period ending on the last day before the beginning of the plan year. "(II) SECRETARIAL AUTHORITY.—If the Secretary

finds that the lowest rate of interest permissible under subclause (I) is unreasonably high, the Secj;. ^... retary may prescribe a lower rate of interest, except that such rate may not be less than 80 percent of the average rate determined under subclause (I). "(iii) ASSUMPTIONS.—Notwithstanding subsection (c)(3)(A)(i), for purposes of this section and for purposes of determining current liability, the interest rate used, under the plan shall be— 1/ "(I) determined without taking into account the experience of the plan and reasonable expectations, but "(II) consistent with the assumptions which reflect the purchase rates which would be used by insurance companies to satisfy the liabilities under the plan.". (2) AMENDMENT TO ERISA.—Paragraph (5) of section 3O20t>) of ERISA (relating to interest) (29 U.S.C. 1082(b)(5)) is amended to read as follows: "(5) INTEREST.—For purposes of determining a plan's current liability and for purposes of determining a plan's required contribution under section 412(1) for any plan year— "(A) IN GENERAL.—The funding standard account (and items therein) shall be charged or credited (as determined under regulations prescribed by the Secretary of the Treasury) with interest at the appropriate rate consistent with the rate or rates of interest used under the plan to determine costs. "(B) R E Q U I R E D CHANGE OF INTEREST RATE.—

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"(i) IN GENERAL.—If any rate of interest used under the plan to determine cost is not within the permissible range, the plan shall establish a new rate of interest within the permissible range. "(ii) PERMISSIBLE RANGE.—For purposes of this subparagraph— "(I) IN GENERAL.—Except as provided in subclause (II), the term 'permissible range' means a rate of interest which is not more than 10 percent above, and not more than 10 percent below, the average rate of interest on 30-year Treasury securities during the 4-year period ending on the last day before the beginning of the plan year.

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