SUMMARY: The Executive Director of the Federal Retirement Thrift Investment Board (Board) is publishing an amendment to final rules on correction of administrative errors affecting Thrift Savings Plan (TSP) accounts. The effect of the amendment will be that earnings on contributions made to the TSP by a person who is ineligible to participate will be returned to that person and not used to offset TSP adminis trative expenses. EFFECTIVE DATE: This amendment is effective December 27, 1996. FOR FURTHER INFORMATION CONTACT: John J. O'Meara, (202) 942-1661. SUPPLEMENTARY INFORMATION: A final rule governing the correction of administrative errors affecting Thrift Savings Plan accounts was published in the Federal Register on December 27, 1996 (61 FR 68464). That rule revised the final regulations that were published in the Federal Register on December 4, 1987 (52 FR 46314). In both sets of regulations the Board provided that when an individual who was not eligible to participate in the TSP nevertheless contributed funds to the TSP, the individual's contributions would be returned, but the earnings on those contributions would be forfeited and used to pay administrative expenses of the TSP. Upon review of this matter, the Board has decided that in promulgating this regulation insufficient emphasis was placed on the ineligible participant's equitable claim to these earnings. For this reason, Sec. 1605.9(a)(1) of the error correction regulations is being amended to provide that these earnings will be paid to the ineligible participant. Because the equity interest in these earnings by the ineligible participant is so substantial, this amendment is being given retroactive effect to the effective date (December 27, 1996) of the current error correction regulations. Regulatory Flexibility Act I certify that this amendment will not have a significant economic impact on a substantial number of small entities. It will only affect Thrift Savings Plan participants. Paperwork Reduction Act I certify that these regulations do not require additional reporting under the criteria of the Paperwork Reduction Act of 1980. Unfunded Mandates Reform Act of 1995 Pursuant to the Unfunded Mandates Reform Act of 1995, section 201, Public Law 104-4, 109 Stat. 48, 64, the effect of these regulations on State, local, and tribal governments, and on the private sector has been assessed. This regulation will not compel the expenditure in any one year of $100 million or more by any State, local, and tribal governments in the aggregate, or by the private sector. Therefore, a statement under section 202, 109 Stat. 48, 64-65, is not required. Submission to Congress and the General Accounting Office Under 5 U.S.C. 801(a)(1)(A), the Board submitted a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States before the publication of this rule in today's Federal Register. This rule is not a major rule as defined in section 804(2). List of Subjects in 5 CFR Part 1605 Administrative practice and procedure, Employee benefit plans, Government employees, Pensions, Retirement. Roger W. Mehle, Executive Director, Federal Retirement Thrift Investment Board. For the reasons set forth in the preamble, part 1605 of chapter VI of title 5 of the Code of Federal Regulations is amended as follows: PART 1605--CORRECTION OF ADMINISTRATIVE ERRORS 1. The authority citation for Part 1605 continues to read as follows: Authority: 5 U.S.C. 8351 and 8474. 2. Section 1605.9 is amended by revising the second sentence of paragraph (a)(1) to read as follows: Sec. 1605.9 Miscellaneous provisions. (a)(1) * * * In that case, the earnings will be removed from the account and paid to the ineligible participant. * * * * * * * * [FR Doc. 97-24760 Filed 9-17-97; 8:45 am] BILLING CODE 6760-01-U
Correction of Administrative Errors
The Executive Director of the Federal Retirement Thrift Investment Board (Board) is publishing an amendment to final rules on correction of administrative errors affecting Thrift Savings Plan (TSP) accounts. The effect of the amendment will be that earnings on contributions made to the TSP by a person who is ineligible to participate will be returned to that person and not used to offset TSP adminis trative expenses.