Rules and Regulations. Notice of Proposed Exemptions

Agency: Employment and Training Administration (ETA). Type of Review: New Collection. Title: Prisoner Reentry Initiative (PRI) Reporting System. OMB Number: 1205-0NEW. Frequency: Quarterly. Affected Public: Not-for-profit institutions. Type of Response: Recordkeeping; Reporting. Number of Respondents: 30. Annual Responses: 6,490. Average Response time: 64 hours. Total Annual Burden Hours: 15,150. Total Annualized Capital/Startup Costs: 0. Total Annual Costs (operating/maintaining systems or purchasing services): 0. Description: Respondents are Faith-Based and Community Organization (FBCO) grantees. Selected standardized information pertaining to customers in Prisoner Reentry Initiative (PRI) programs will be collected and reported for the purposes of general program oversight, evaluation and performance assessment. ETA will provide all grantees with a PRI management information system to use for collecting participant data and for preparing and submitting the required quarterly reports. Ira L. Mills, Departmental Clearance Officer. [FR Doc. E5-7963 Filed 12-27-05; 8:45 am] BILLING CODE 4510-43-P DEPARTMENT OF LABOR Employee Benefits Security Administration [Application No. D-11306, et al.] Proposed Exemptions; Pennsylvania Institute of Neurological Disorders, Inc. Profit Sharing Plan (the Plan) AGENCY: Employee Benefits Security Administration, Labor
Action: Notice of Proposed Exemptions
Citation: FR Doc. 05-24493 · FR Doc. E5-7962 Filed 12-27-05; 8:45 am

Summary

This document contains notices of pendency before the Department of Labor (the Department) of proposed exemptions from certain of the prohibited transaction restrictions of the Employee Retirement Income Security Act of 1974 (the Act) and/or the Internal Revenue Code of 1986 (the Code). Written Comments and Hearing Requests All interested persons are invited to submit written comments or requests for a hearing on the pending exemptions, unless otherwise stated in the Notice of Proposed Exemption, within 45 days from the date of publication of this Federal Register Notice. Comments and requests for a hearing should state: (1) The name, address, and telephone number of the person making the comment or request, and (2) the nature of the person's interest in the exemption and the manner in which the person would be adversely affected by the exemption. A request for a hearing must also state the issues to be addressed and include a general description of the evidence to be presented at the hearing.

Supplementary Information

The proposed exemptions were requested in applications filed pursuant to section 408(a) of the Act and/or section 4975(c)(2) of the Code, and in accordance with procedures set forth in 29 CFR part 2570, subpart B (55 FR 32836, 32847, August 10, 1990). Effective December 31, 1978, section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1 (1996), transferred the authority of the Secretary of the Treasury to issue exemptions of the type requested to the Secretary of Labor. Therefore, these notices of proposed exemption are issued solely by the Department. The applications contain representations with regard to the proposed exemptions which are summarized below. Interested persons are referred to the applications on file with the Department for a complete statement of the facts and representations. Pennsylvania Institute of Neurological Disorders, Inc. Profit Sharing Plan (the Plan) Located in Sunbury, PA [Application No. D-11306] Proposed Exemption The Department is considering granting an exemption under the authority of section 408(a) of the Act and section 4975(c)(2) of the Code and in accordance with the procedures set forth in 29 CFR part 2570, subpart B (55 FR 32836, 32847, August 10, 1990). If the exemption is granted, the restrictions of sections 406(a), 406(b)(1) and (b)(2) of the Act and the sanctions resulting from the application of section 4975 of the Code, by reason of section 4975(c)(1)(A) through (E) of the Code, shall not apply to the proposed sale (the Sale) by the Plan of a parcel of unimproved real property known as Lot 20, Section “F”, Monroe Manor, Inc., (Lot #20 Kingswood Drive, Selinsgrove, PA 17870) (the Property) to Mahmood Nasir, M.D. (Dr. Nasir), a party in interest with respect to the Plan, provided that the following conditions are satisfied: (a) All terms and conditions of the Sale are at least as favorable to the Plan as those that the Plan could obtain in an arm's-length transaction with an unrelated party; (b) The Sales price is the greater of $81,000 or the fair market value of the Property as of the date of the Sale; (c) The fair market value of the Property has been determined by a qualified independent appraiser; (d) The Sale is a one-time transaction for cash; (e) The Plan does not pay any commissions, costs, or other expenses in connection with the Sale; and (f) The Plan fiduciaries will determine, among other things, whether it is in the interest of the Plan to go forward with the Sale of the Property, will review and approve the methodology used in the appraisal that is being relied upon, and will ensure that such methodology is applied by a qualified independent appraiser in determining the fair market value of the Property as of the date of the Sale. Summary of Facts and Representations 1. The Pennsylvania Institute of Neurological Disorders, Inc. (the Employer) is the sponsor of the Plan. Dr. Nasir is the sole owner and shareholder of the Employer. Dr. Nasir is also the President of the Employer. The Employer is located in Sunbury, Pennsylvania. The Plan is a defined contribution profit sharing plan which was effective as of September 1, 1993. As of December 31, 2004, the Plan had seven participants, who are as follows: Dr. Nasir, Denise Bebenek, Teresa Gelnett, Julie Rebuck, Judy S. Smink, Hollie Vankirk, and Cassie J. Wolfe. The Trustees of the Plan are Dr. Nasir and Rubina Nasir. As of December 31, 2004, the Plan had total assets of $403,241.99. 2. In July 1995, the Plan purchased the Property from John A. Bolig and Christabelle M. Bolig, unrelated third parties, for $49,000. 1 The Property is a 22,500 square foot parcel of unimproved real property located at Lot #20 Kingswood Drive, Selinsgrove, Pennsylvania 17870. The Property is adjacent to property owned and resided on by Dr. Nasir. The applicant represents that the Property has not been leased to, or used by, any party in interest with respect to the Plan since the date of acquisition by the Plan. The value of the Property represents approximately 16.57% of the Plan's total assets as of December 31, 2004. The applicant represents that the only Plan expenditure with respect to the Property is $511.72 in annual real estate taxes from 1995 ( i.e. , the year of original acquisition) until the present. Therefore, the total cost to the Plan for the Property was $54,628.92 as of the present date ($5,628.92 + $49,000 = $54,628.92). Since the date of the purchase, the Property has remained vacant and no income has been generated. 1 The Department expresses no opinion herein as to whether the acquisition and holding of the Property by the Plan violated any of the provisions of part 4 of Title I of the Act. 3. The Property was appraised (the Appraisal) on June 21, 2005, by Mary Beth Rodriguez (the Appraiser), of the Bowen Agency in Selinsgrove, Pennsylvania. The Appraiser is certified by the Commonwealth of Pennsylvania as a General Appraiser. The Appraiser has certified that she is independent of the Employer, the Trustees, and any other parties in interest. The Property was valued using the sales approach. The Appraiser compared the Property to three other similar properties sold within a one-half mile of the Property since March 2004. She adjusted the sale price of the comparable properties based upon date of the sale, location, and site/view. The Appraiser determined that the fair market value of the Property was $81,000 as of June 21, 2005. The Appraiser did not attribute any special benefit to the value of the Property from the ownership of Dr. Nasir of the adjacent property due to a number of factors. First, there is a driveway dividing the two parcels. Second, the ownership of the Property by Dr. Nasir does not affect Dr. Nasir's interest in the adjacent lot. Finally, the value of the sum of the separate values for the Property and the adjacent parcel already owned by Dr. Nasir is greater than the value if the Property and the adjacent lot were sold as one combined lot. Therefore, the Appraisal does not include any premium for assemblage value. 2 2 “Assemblage” value reflects the willingness of a purchaser to pay above market value for a parcel of property in order to preserve such purchaser's interest in their present holdings of other parcels which are adjacent to such property. 4. The applicant represents that the proposed transaction is in the interest of the Plan because a gain will be realized when the parcel of land is sold to Dr. Nasir and the proceeds can be reinvested in other investments with a higher rate of return without incurring carrying costs such as real estate taxes. The Property is the only real property owned by the Plan. The transaction will be a one-time cash sale and will enable the Plan to diversify its investment portfolio. Furthermore, the applicant represents that the proposed transaction is in the best interest and protective of the Plan because the Sale will be for an amount equal to the greater of: (i) $81,000 which represents the fair market value of the Property as of June 21, 2005, or (ii) the current fair market value of the Property, as established by a qualified independent appraiser on the date of the Sale. This amount exceeds the original acquisition cost of the Property, plus expenses and real estate taxes incurred by the Plan from the date of the acquisition until the date of the proposed Sale. The Plan will not pay any commissions, costs, or other expenses in connection with the Sale. The applicant states that the Appraisal will be updated as of the date of the transaction. 3 3 For this purpose, the updated appraisal must take into account any new data on recent sales of similar property in the local real estate market, which may affect the valuation conclusion. 5. The Plan fiduciaries will determine, among other things, whether it is in the interest of the Plan to go forward with the Sale of the Property, will review and approve the methodology used in the appraisal that is being relied upon, and will ensure that such methodology is applied by a qualified independent appraiser in determining the fair market value of the Property as of the date of the Sale. 6. The proposed transaction will occur within 30 days of the publication of the grant of the prohibited transaction exemption. 7. In summary, the applicant represents that the subject transaction satisfies the statutory criteria contained in section 408(a) of the Act and section 4975(c)(2) of the Code for the following reasons: (a) All terms and conditions of the Sale will be at least as favorable to the Plan as those that the Plan could obtain in an arms-length transaction with an unrelated party; (b) The fair market value for Property has been determined by a qualified independent appraiser; (c) The Sale will be a one-time transaction for cash; (d) The Plan will not pay any commissions, costs, or other expenses in connection with the Sale; and (e) The Plan will receive an amount equal to the greater of: (i) $81,000; or (ii) the current fair market value of the Property as of the date of the Sale. Notice to Interested Persons Notice of the proposed exemption shall be given to all interested persons in the manner agreed upon by the applicant and Department within 15 days of the date of publication in the Federal Register . Comments and requests for a hearing are due forty-five (45) days after publication of the notice in the Federal Register .