1210-0090 SS 404(a) Participant Level Fee Disclosure 8.7.23 (clean)

Participant Level Fee Disclosure

OMB Number 1210-0090

OMB Expiration Date: 8/31/2023

SUPPORTING STATEMENT FOR PAPERWORK REDUCTION ACT OF 1995: PARTICIPANT LEVEL FEE DISCLOSURE

This information collection request (ICR) seeks approval for an extension without change of an existing control number.

1. Explain the circumstances that make the collection of information necessary. Identify any legal or administrative requirements that necessitate the collection. Attach a copy of the appropriate section of each statute and regulation mandating or authorizing the collection of information.

Currently, a large percentage or American’s workers are covered by participant-directed 401(k)-type plans. Workers in these plans are responsible for making their own investment decisions; therefore, they need information about the individual and comparable performance of the designated investment alternatives available to them under their employers’ plans furnished in a format useful to workers, particularly information on investment choices including associated fees and expenses.

The Department became concerned that participants and beneficiaries might not have adequate access to or might not be considering information critical to making informed decisions about the management of their retirement accounts. To address this issue, the Department published a regulation under ERISA section 404(a), with conforming amendments to the regulations under ERISA section 404(c)¹, that requires plan fiduciaries to disclose plan- and investment-related fee and expense information to participants and beneficiaries in all participant directed individual account plans (e.g., 401(k)-type plans) for plan years that began on or after January 1, 2010² and at least annually thereafter (defined by regulation as at least once in any 14-month period, without regard to whether the plan operates on a calendar or fiscal year basis).

The rule contains the following information collections, which are third party disclosures from plan fiduciaries to participants and beneficiaries in participant-directed individual account plans:

Plan-related Information—29 CFR 2550.404a-5(c). The rule requires three sub-categories of Plan-related information to be provided to participants and beneficiaries. The first sub-category is General Plan Information, which includes how participants may give investment instructions or exercise proxy voting or tendering rights, restrictions on transferring account assets among investment alternatives, and identification of the plan's designated investment alternatives and designated investment managers (29 CFR 2550.404a-5(c)(1)). This information must be provided by the time a participant becomes eligible to participate in the plan, and afterwards at least annually. Material changes to this information must be disclosed at least 30 days but no more than 90 days before the effective date of the change except for unforeseen events or circumstances beyond the plan administrator’s control. Plans may make these disclosures in the summary plan description (SPD) with OMB control number 1210-0039.

The second sub-category of Plan-related information is Administrative Expense Information, which refers to explanations of any fees and expenses for general plan administrative services (e.g., legal, accounting, recordkeeping) charged to individual accounts and the basis for allocating such charges among the accounts (e.g., pro-rata, per capita). (29 CFR 2550.404a-5(c)(2)). This information must be provided by the time a participant becomes eligible to participate in the plan, and afterwards at least annually. At least quarterly, plans must furnish statements of the aggregate dollar amount charged to each participant's account for these expenses during the previous quarter. Plans may make the initial and annual disclosures in the SPD and the quarterly information may be included in the plan's quarterly benefit statements.

The third sub-category of Plan-related information is Individual Expense Information, which describes expenses assessed against accounts based on the actions taken by individual participants or beneficiaries. This would include charges for processing participant loans and qualified domestic relations orders. (29 CFR 2550.404a-5(c)(3)). Information describing these charges must be furnished before or upon a participant's eligibility and annually thereafter. Plans must provide quarterly statements identifying and showing the dollar amounts of each expense actually charged to an account. Plans may make the initial and annual disclosures in the SPD and the quarterly information may be included in the plan's quarterly benefit statements.

Investment-related Information—29 CFR 2550.404a-5(d). The rule also requires plan administrators to disclose three sub-categories of investment-related information to participants and beneficiaries on or before their date of eligibility, which relates to the plans designated investment alternatives.³ The first sub-category of information is information required to be provided automatically. (29 CFR 2550.404a-5(d)(1)). For each designated investment alternative, the plan must disclose specified identifying information, past performance data, comparable benchmark returns, fee and expense information, and an Internet website address that is sufficiently specific to lead participants and beneficiaries to specified supplemental information for each investment alternative.

The latest information available to the plan must be furnished annually. Material changes to this information must be disclosed at least 30 days but no more than 90 days before the effective date of the change except for unforeseen events or circumstances beyond the plan administrator’s control.

Investment-related information must be furnished in a chart or similar format designed to help participants compare the plan's investment alternatives across each category of information. (29 CFR 2550.404a-5(d)(2)). To facilitate compliance, the rule includes a model chart that may be used by plan fiduciaries to satisfy this requirement.

The second sub-category of investment-related information is Post-Investment Information. Following a participant's investment in an alternative, the plan administrator must provide any materials it receives regarding voting, tender or similar rights in the alternative (“pass-through materials”) to the extent such rights are passed through to the participant or beneficiary. (29 CFR 2550.404a-5(d)(3)).

The third sub-category of investment-related information is Information to be provided upon Request (29 CFR 2550.404a-5(d)(4)). Participants may request the plan to provide prospectuses, financial reports, as well as statements of valuation and a list of assets held by an investment alternative.

The rule describes the timeframes and acceptable format for providing the disclosures.

2. Indicate how, by whom, and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection.

The information collections under this ICR are not for the use of the Department or any other federal agency; they are mandated third-party disclosures. The information will be used by participant and beneficiaries in ERISA-covered participant directed individual account plans to make informed decisions regarding the investment of assets held in their individual accounts. The Department will not collect the information required to be disclosed.

3. Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses, and the basis for the decision for adopting this means of collection. Also describe any consideration for using information technology to reduce burden.

The Department has published rules at 29 CFR 2520.104b-1(c) and 29 CFR 2520.104b-31(f) that describe the circumstances under which plan administrators may use electronic technologies to satisfy disclosure requirements under ERISA, including the information collections included in this ICR. Plan administrators may rely on that regulation to use electronic technologies to fulfill disclosure obligations so long as they comply with the conditions in the rules. Assumptions as to the extent to which plan administrators currently use electronic technology to satisfy these information collections are incorporated in the burden estimates for this ICR, as described in the response to item 12, below.

Moreover, in response to comments regarding the regulation, the Department amended the rule to provide a more flexible electronic disclosure standard by allowing plan administrators to satisfy the notice requirement by relying on the Department’s electronic media disclosure rules or the guidance issued by the Department of the Treasury and Internal Revenue Service at 26 CFR § 1.401(a)-21 relating to the use of electronic media.

4. Describe efforts to identify duplication. Show specifically why any similar information already available cannot be used or modified for use for the purposes described in Item 2 above.

The information collections associated with the rule do not duplicate information available from any other source. In principal part, this information collection merely insures that existing relevant information is furnished appropriately to plan participants and beneficiaries. In fashioning the regulation, the Department took account of other similar federal and state requirements in order to reduce or eliminate duplication of effort.

The Department consulted with the Securities and Exchange Commission (the SEC) to avoid including duplicative, overlapping, or conflicting requirements in the proposal. In general, the rule follows the SEC’s disclosure regime for most investments. The Department knows of no other relevant federal rules that duplicate, overlap, or conflict with the regulations.

5. If the collection of information impacts small businesses or other small entities describe any methods used to minimize burden.

In 29 CFR 2550.404a-5(c) and 29 CFR 2550.404a-5(d), the regulation does not provide special reduced requirements for small plans or small employers, because the information collections are designed specifically to protect the rights of participants and beneficiaries covered by participant-directed individual account plans. The Department believes that the information collections contained in the rule are as important to participants and beneficiaries in small plans (or associated with small employers) as they are to participants and beneficiaries in large plans (or associated with large employers), because participants and beneficiaries in small plans need the same amount and quality of information regarding their investments and investment alternatives as participants and beneficiaries in large plans in order to make informed decisions about the management of the retirement assets in their accounts.

Small business owners who offer their employees a pension plan with participant-directed individual accounts may not have the resources to analyze plan fees themselves or to hire an analyst for that purpose. However, in the likely case that small business owners use service providers for plan administration purposes, some of the costs of complying with the new requirements will be borne by the service provider who might be able to distribute them to a large number of clients. While the rule could conceivably discourage some employers from offering plans, the Department notes that the rule builds on longstanding disclosure requirements for section 404(c) plans.

6. Describe the consequence to Federal program or policy activities if the collection is not conducted or is conducted less frequently, as well as any technical or legal obstacles to reducing burden.

Conducting these information collections less frequently or not at all would deprive participants and beneficiaries in participant-directed individual account plans of easy access to information needed to make investment decisions that the participant or beneficiary believes will maximize the value of retirement savings. Moreover, in the aggregate, participants and beneficiaries would spend a considerable amount of time searching for this information.

The disclosures help a large number of plan participants by displaying investment-related information in a format that facilitates comparison of investment alternatives. This simplified format makes it easier and less time consuming for participants to find and compare information they need to effectively manage their retirement accounts. The Department believes that these disclosures benefit plan participants and beneficiaries directly by helping them to pick the lowest cost comparable investment alternatives offered under their plans. Wiser selections, in turn, increase accounts’ investment returns and strengthen retirement savings. As participants and beneficiaries become more sophisticated investors, their behavior will create more competition among the providers of the investment alternatives, which could drive down fund fees. In addition, plan fiduciaries may use the increased disclosures to scrutinize fees in order to select less expensive comparable investment alternatives under the plans. All these benefits depend on the timeliness and frequency of the information collection; the less frequent the disclosures, the less ability participants will have to determine how best to allocate their investments.

7. Explain any special circumstances that would cause an information collection to be conducted in a manner:

• requiring respondents to report information to the agency more often than quarterly;

• requiring respondents to prepare a written response to a collection of information in fewer than 30 days after receipt of it;

• requiring respondents to submit more than an original and two copies of any document;

• requiring respondents to retain records, other than health, medical, government contract, grant-in-aid, or tax records for more than three years;

• in connection with a statistical survey, that is not designed to produce valid and reliable results that can be generalized to the universe of study;

• requiring the use of a statistical data classification that has not been reviewed and approved by OMB;

• that includes a pledge of confidentiality that is not supported by authority established in statute or regulation, that is not supported by disclosure and data security policies that are consistent with the pledge, or which unnecessarily impedes sharing of data with other agencies for compatible confidential use; or

• requiring respondents to submit proprietary trade secret, or other confidential information unless the agency can demonstrate that it has instituted procedures to protect the information's confidentiality to the extent permitted by law.

None of the special circumstances apply.

8. If applicable, provide a copy and identify the date and page number of publication in the Federal Register of the agency's notice, required by 5 CFR 1320.8(d), soliciting comments on the information collection prior to submission to OMB. Summarize public comments received in response to that notice and describe actions taken by the agency in response to these comments. Specifically address comments received on cost and hour burden.

Describe efforts to consult with persons outside the agency to obtain their views on the availability of data, frequency of collection, the clarity of instructions and record keeping, disclosure, or reporting format (if any), and on the data elements to be recorded, disclosed, or reported.

Consultation with representatives of those from whom information is to be obtained or those who must compile records should occur at least once every 3 years -- even if the collection of information activity is the same as in prior periods. There may be circumstances that may preclude consultation in a specific situation. These circumstances should be explained.

The Department’s Federal Register Notice required by 5 CFR 1320.8(d) soliciting comments on the information collection was published on February 8, 2023, 88 FR 8317. No comments were received by the Department on the ICR.

9. Explain any decision to provide any payment or gift to respondents, other than remuneration of contractors or grantees.

There are no payments or gifts to respondents.

10. Describe any assurance of confidentiality provided to respondents and the basis for the assurance in statute, regulation, or agency policy.

No assurance of confidentiality has been provided.

11. Provide additional justification for any questions of a sensitive nature, such as sexual behavior and attitudes, religious beliefs, and other matters that are commonly considered private. This justification should include the reasons why the agency considers the questions necessary, the specific uses to be made of the information, the explanation to be given to persons from whom the information is requested, and any steps to be taken to obtain their consent.

There are no questions of a sensitive nature.

12. Provide estimates of the hour burden of the collection of information. The statement should: 

• Indicate the number of respondents, frequency of response, annual hour burden, and an explanation of how the burden was estimated. Unless directed to do so, agencies should not conduct special surveys to obtain information on which to base hour burden estimates. Consultation with a sample (fewer than 10) of potential respondents is desirable. If the hour burden on respondents is expected to vary widely because of differences in activity, size, or complexity, show the range of estimated hour burden, and explain the reasons for the variance. General, estimates should not include burden hours for customary and usual business practices. 

• If this request for approval covers more than one form, provide separate hour burden estimates for each form. 

• Provide estimates of annualized cost to respondents for the hour burdens for collections of information, identifying and using appropriate wage rate categories. The cost of contracting out or paying outside parties for information collection activities should not be included here. Instead, this cost should be included in Item 14. 

The Department has made the following assumptions in order to establish a reasonable estimate of the paperwork burden associated with this ICR:

• Based upon Form 5500 data from the 2020 Plan Year,⁴ 619,650 participant-directed individual account plans with 102,379,605 participants will produce and distribute the required disclosures;

• On an annual basis, 7 percent of plans will be new and the remaining 93 percent of plans will be existing plans;

• Plans will distribute 94.2 percent of disclosures electronically using existing systems in accordance with the Department’s standards for electronic communication of required information under 29 CFR 2520.104b-1(c) and 29 CFR 2520.104b-31(f). ⁵ Therefore, no cost has been attributed to the electronic distribution of information;

• Plans will use existing in-house resources to conduct compliance review, create and distribute disclosures, create the website, and adjust the IT systems necessary to fulfill the requirements of this rule;

• The tasks associated with the ICR will be performed by clerical personnel at an hourly rate of $63.45, legal professionals at an hourly rate of $159.34, accountants at an hourly rate of $116.86, and IT professionals at an hourly rate of $133.05.⁶

Plan-Related Information

The rule requires all plans to provide General Plan Information annually and Administrative and Individual Expense Information quarterly.

The Department assumes that every year, new plans will have in-house legal staff spend 30 minutes conducting compliance review and developing the General Plan Information disclosure for a total of 21,688 hours at an equivalent cost of $3.46 million, while clerical staff will spend 30 minutes gathering documents and providing administrative support for the legal staff for a total of 21,688 hours at an equivalent cost of $1.38 million. Existing plans will have in-house legal staff spend 15 minutes conducting compliance review and updating the General Plan Information disclosure for a total of 144,069 hours at an equivalent cost of $23.0 million, while clerical staff will spend 15 minutes gathering documents and providing administrative support for the legal staff for a total of 141,069 hours at an equivalent cost of $9.14 million. The General Plan Information disclosure will be sent to all participants (102.4 million participants) and 5.8 percent of the disclosures (5.9 million disclosures) will be sent by mail. Clerical staff is assumed to spend, on average, two minutes per disclosure to copy and mail this information for a total of 197,934 hours at an equivalent cost of $12.56 million.

The Department assumes that Administrative and Individual Expense Information will be included as part of required quarterly statements. Calculating the Expense Information will be performed by outside service providers, and as such, has been included in the cost section in question 13. All other costs associated with this required disclosure are included in the hour and cost burden calculations for producing and distributing quarterly statements, which fall under OMB Control Number, 1210-0039.

Investment-Related Information

The rule requires all plans to provide, annually, a comparative chart containing specified identifying information, past performance data, comparable benchmark returns, fee and expense information, and a link to a website regarding investment options. The rule also requires all plans to create and maintain a website with investment disclosures. Further, the rule requires plans to provide post-investment “pass through” disclosure materials to participants’ investments in an alternative investment. Finally, the rule requires plans to provide a variety of disclosure materials upon request.

The Department assumes that in-house accountants will spend 5 hours per new plan creating comparative charts and 4 hours per existing plan updating comparative charts for a total of 2.5 million hours at an equivalent cost of $294.7 million. The comparative chart will be sent to all participants (102.4 million participants) and 5.8 percent of the disclosures (5.9 million disclosures) will be sent by mail. Clerical workers are assumed to spend, on average, two minutes per disclosure to copy and mail this information for a total of 197,934 hours at an equivalent cost of $12.56 million.

The Department assumes that in-house IT staff will spend 3.5 hours per new plan creating, and updating quarterly, a website that meets the requirements of this rule, while in-house IT staff will spend 2 hours per existing plan making quarterly updates of the website. The total hourly burden for IT staff will be approximately 1.3 million hours at an equivalent cost of $173.55 million (1.3 million hours at $133.05 an hour).

Because the “pass through” disclosures are only required to be given post-investment to investors choosing alternative investments, the Department assumes that only plan participants in plans with employer securities will receive these disclosures. These disclosures will be sent to all participants in plans with employer securities (15.4 million participants) and 92.4 percent of the disclosures (0.9 million disclosures) will be sent by mail. Clerical workers are assumed to spend, on average, two minutes per disclosure to copy and mail this information for a total of 29,781 hours at an equivalent cost of $1.89 million.

Finally, the Department estimates that each plan will receive one request for information per year. Each information request will require 1 hour of clerical time to prepare the request and 2 minutes of clerical time to copy and mail the information. Assuming that 5.8 percent of requests will be mailed, approximately 1,198 hours of clerical burden at an equivalent cost of $0.08 million will result.

Summary

In summary, creating, preparing, and distributing these require disclosures will result in 5.2 million hours of burden annually at an equivalent cost of $571.59 million.

Estimated Annualized Respondent Hour Burden and Equivalent Cost of Hour Burden

Activities	No. of Respondents	No. of Responses per Respondent	Total Responses	Average Burden (Hours)	Total Burden (Hours)	Wage Rates	Equivalent Cost of Hour Burden
New Plan Compliance Review (Legal)	43,376	1	43,376	30/60	21,688	$159.34	$3,455,726
New Plan Document Gathering (Clerical)	43,376	1	43,376	30/60	21,688	$63.45	$1,376,088
Existing Plan Compliance Review (Legal)	576,275	1	576,275	15/60	144,069	$159.34	$22,955,895
Existing Plan Document Gathering (Clerical)	576,275	1	576,275	15/60	144,069	$63.45	$9,141,154
Production and Distribution of General Plan Information (Paper Copies)	619,650	9.58	5,938,017	2/60	197,934	$63.45	$12,558,906
Production and Distribution of General Plan Information (Electronic Copies)	619,650	155.64	96,441,588	0	0	$63.45	$0
New Plan Comparative Chart (Accountant)	43,376	1	43,376	5	216,878	$116.86	$25,344,304.65
Existing Plan Comparative Chart (Accountant)	576,275	1	576,275	4	2,305,098	$116.86	$269,373,752
Production and Distribution of Comparative Chart (Paper Copies)	619,650	9.58	5,938,017	2/60	197,934	$63.45	$12,558,906
Production and Distribution of Comparative Chart (Electronic Copies)	619,650	155.64	96,441,588	0	0	$63.45	$0
New Plan Website (IT Staff)	43,376	1	43,376	3 30/60	151,814	$133.05	$20,198,885.96
Existing Plan Website (IT Staff)	576,275	1	576,275	2	1,152,549	$133.05	$153,346,644
Production and Distribution of “Pass Through” Disclosures (Paper Copies)	619,650	1.44	893,437	2/60	29,781	$63.45	$1,889,619
Production and Distribution of “Pass Through” Disclosures (Electronic Copies)	619,650	23.42	14,510,650	0	0	$63.45	$0
Production of Information on Request (Clerical)	619,650	1	619,650	1	619,650	$63.45	$39,316,792
Distribution of Information on Request (Paper Copies)	619,650	0.06	35,940	2/60	1,198	$63.45	$76,012
Distribution of Information on Request (Electronic Copies)	619,650	0.94	583,710	0	0	$63.45	$0
Unduplicated Totals	619,650*	1,678.08	1,039,819,787**		5,204,349		$571,592,687

* As discussed above, there are 619,650 participant-directed individual account plans based upon Form 5500 data from the 2020 Plan Year.

**The number of responses are calculated in the following manner: 102,379,605 (General Plan Information) + 409,518,420 (Individual and Administrative Expenses) + 102,379,605 (Comparative Chart) + 15,404,087 (Post-Investment Pass-Through Information) + 619,650 (Information Upon Request) + 409,518,420 (Website) = 1,039,819,787.

13. Provide an estimate of the total annual cost burden to respondents or recordkeepers resulting from the collection of information. (Do not include the cost of any hour burden shown in Items 12 and 14).

• The cost estimate should be split into two components: (a) a total capital and start up cost component (annualized over its expected useful life); and (b) a total operation and maintenance and purchase of service component. The estimates should take into account costs associated with generating, maintaining, and disclosing or providing the information. Include descriptions of methods used to estimate major cost factors including system and technology acquisition, expected useful life of capital equipment, the discount rate(s), and the time period over which costs will be incurred. Capital and start-up costs include, among other items, preparations for collecting information such as purchasing computers and software; monitoring, sampling, drilling and testing equipment; and record storage facilities.

• If cost estimates are expected to vary widely, agencies should present ranges of cost burdens and explain the reasons for the variance. The cost of purchasing or contracting out information collection services should be a part of this cost burden estimate. In developing cost burden estimates, agencies may consult with a sample of respondents (fewer than 10), utilize the 60-day pre-OMB submission public comment process and use existing economic or regulatory impact analysis associated with the rulemaking containing the information collection, as appropriate. 

• Generally, estimates should not include purchases of equipment or services, or portions thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with requirements not associated with the information collection, (3) for reasons other than to provide information or keep records for the government, or (4) as part of customary and usual business or private practices. 

As explained in question 12 above, the rule requires plan-related and investment-related information to be disclosed to participants and beneficiaries covered by participant directed individual account plans. The Department developed estimates for the universe of plans, participants and beneficiaries affected by these information collections. Additional costs in this Question 13 relate solely to the additional costs that arise from determining administrative and individual fees charge against participants’ accounts, printing and distributing the required disclosures, and establishing and maintaining the plans’ websites. The annual cost burden is calculated as follows:

Plan-Related Information

The Department assumes that plans will send 102.38 million copies of the General Plan Information to plan participants and beneficiaries, which will contain an average of 10 pages. Paper and printing costs are expected to be 5 cents per page and mailing costs are expected to be $1.37 per mailed disclosure.⁷ It is assumed that 94.2 percent of the required plan information will be delivered electronically for a de minimis cost. The mailed copies result in a cost burden of $8.1 million.

Plans will also have to determine the administrative and individual fees that will be charged directly against participants’ accounts, which will be included in the plans’ quarterly benefit statements.⁸ The Department estimates a cost burden of approximately $15.7 million for new plans to establish information systems or accounting practices that will collect, track and report the actual dollar amounts charged to the individual accounts.

Investment-Related Information

Disclosing investment related information leads to material costs, if the materials are given out by hand or mailed. As with the disclosure of the General Plan Information, it is assumed that 94.2 percent of the disclosures will be sent electronically with no associated cost burden. Paper and printing costs are assumed to be 5 cents per page.

The Department assumes that plans will send 102.38 million copies of the Comparative Chart to plan participants and beneficiaries. As this information is required to be sent on an annual basis the Department assumes it will be sent with the General Plan Information. One comparative chart is assumed to be, on average, three pages long, with mailing costs of $0.15 per disclosure.⁹ Again, it is assumed that 94.2 percent of the charts will be sent electronically with no associated materials burden. The remaining 5.8 percent (5.94 million) will contain an average of three pages. Mailing costs are already accounted for in the calculation of the cost burden for the General Plan Information. The resulting annual cost burden for materials is $0.89 million.

Plans also are required to create and maintain a website. Having a plan website might require plans to rent server space at an estimated cost of $316 annually per plan. The estimated annual cost of renting the server space is approximately $195.72 million.

With regard to post-investment pass-through disclosures, it is assumed that this information would primarily be sent to those participants holding company securities. This results in approximately 15.40 million participants receiving disclosures each year. One disclosure is assumed to be, on average, ten pages long, with mailing costs of $1.13 per disclosure.¹⁰ This results in an annual cost burden of $1.01 million (it is assumed that 5.8 percent of the 15.40 participants will receive the information via mail, with the remaining 94.2 percent receiving them electronically with no associated cost burden).

Finally, each plan is expected to receive one information request per year. Information requests are assumed to be 20 pages in length and come with mailing costs of $2.11 per disclosure.¹¹ Of these information requests, 94.2 percent are assumed to be distributed electronically at de minimis cost, while the remaining 35,940 requests will result in a printing and mailing cost of $0.08 million.

Summary

In summary, the total cost burden associated with this information collection is $221.6 million.

Cost Burden Summary Table

Activity	Number of Responses	Average Cost per Response	Total Cost
General Plan Information (Paper)	5,938,017	$1.37	$8,135,083
General Plan Information (Electronic)	96,441,588	$0.00	$0
Administrative and Individual Fees (New Plans)	28,666,289	$1.65	$15,727,282
Comparative Chart (Paper)	5,938,017	$0.15	$890,703
Comparative Chart (Electronic)	96,441,588	$0.00	$0
Website	619,650	$315.85	$195,718,621
Post-Investment Pass-Through Disclosure (Paper)	893,437	$1.13	$1,009,584
Post-Investment Pass-Through Disclosure (Electronic)	14,510,650	$0.00	$0
Information on Request (Paper)	35,940	$2.11	$75,833
Information on Request (Electronic)	583,710	$0.00	$0
Unduplicated Totals			$221,557,106

14. Provide estimates of annualized cost to the Federal government. Also, provide a description of the method used to estimate cost, which should include quantification of hours, operational expenses (such as equipment, overhead, printing, and support staff), and any other expense that would not have been incurred without this collection of information. Agencies also may aggregate cost estimates from Items 12, 13, and 14 in a single table.

There is no cost to the Federal Government associated with this information collection.

15. Explain the reasons for any program changes or adjustments reported in Items 13 or 14.

This information collection updated the number of participant-directed individual account plans, the number of participants in participant-directed individual account plans, the number of participants in participant-directed individual account plans with employer securities, wage costs, mailing costs, and electronic disclosure rate. As a result, the number of responses has increased by 210,126,477, the hour burden has decreased by 709,985 hours, and the cost burden has decreased by $2,423,127.

16. For collections of information whose results will be published, outline plans for tabulation, and publication. Address any complex analytical techniques that will be used. Provide the time schedule for the entire project, including beginning and ending dates of the collection of information, completion of report, publication dates, and other actions.

There are no plans to publish the results of this collection of information.

17. If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons that display would be inappropriate.

The collection of information will display a currently valid OMB control number. The OMB expiration date will be published in the Federal Register following OMB approval.

18. Explain each exception to the certification statement identified in Item 19.

There are no exceptions to the certification statement.

B. COLLECTIONS OF INFORMATION EMPLOYING STATISTICAL METHODS

The use of statistical methods is not relevant to this collection of information.

1 Under ERISA §404(c) fiduciaries of pension plans that allow participants to exercise control of their individual accounts are not responsible for losses resulting from a participant's exercise of such control. In 1992, DOL issued a regulation describing requirements that plans must meet in order for this section to apply. Among other things, this regulation details the disclosures that §404(c) plans must make to participants in order to afford them a reasonable opportunity to control their accounts. However, the fiduciary relief provided by §404(c) is elective and about 40% of participant directed plans chose not to comply with §404(c).

2 29 CFR 2550.404a-5.

3 The requirement to disclose the information on or before the date of plan eligibility may be satisfied by furnishing the most recent annual disclosure (and any material modifications) furnished to participants and beneficiaries.

4 The most recent year available.

5 The Department estimates approximately 94.2% of participants receive disclosures electronically under the combined effects of the 2002 electronic disclosures safe harbor and the 2020 electronic safe harbor. The Department estimates that 58.2% of participants will receive electronic disclosures under the 2002 safe harbor. According to the National Telecommunications and Information Agency (NTIA), 40.0% of individuals age 25 and over have access to the Internet at work. According to a Greenwald & Associates survey, 84.0% of plan participants find it acceptable to make electronic delivery the default option, which is used as the proxy for the number of participants who will not opt-out of electronic disclosure that are automatically enrolled (for a total of 33.6% receiving electronic disclosure at work). Additionally, the NTIA reports that 40.4% of individuals age 25 and over have access to the internet outside of work. According to a Pew Research Center survey, 61.0% of internet users use online banking, which is used as the proxy for the number of internet users who will affirmatively consent to receiving electronic disclosures (for a total of 24.7% receiving electronic disclosure outside of work). Combining the 33.6% who receive electronic disclosure at work with the 24.7% who receive electronic disclosure outside of work produces a total of 58.2%. The remaining 41.8% of participants are subject to the 2020 safe harbor. According to the 2019 American Community Survey, 86.6% of the population has an internet subscription. The Department estimates that 0.5% of electronic disclosures will bounce back and will need to be sent a paper disclosure. Accordingly, for the 41.8% of participants not affected by the 2002 safe harbor, 86.1%, or an additional 36.0% (41.8% x 86.1%), are estimated to receive electronic disclosures under the 2020 safe harbor. In total, the Department estimates that 94.2% (58.2% + 36.0%) would receive electronic disclosures.

6 Internal DOL calculation based on 2023 labor cost data. For more information on how the Department estimates labor costs see: https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf

7 The mailing cost is calculated in the following manner: 10 pages x $0.05 + $0.87 for a 2 oz First Class Postage = $1.37. Postage costs can be found at: https://pe.usps.com/text/dmm300/Notice123.htm?_gl=1*1iljkta*_ga*NDIwODUwODQ2LjE2ODAyODk4NjE.*_ga_3NXP3C8S9V*MTY4MDI4OTg2MC4xLjAuMTY4MDI4OTg2MC4wLjAuMA..#_c038

8 Because these data will be included in quarterly benefit statements, no materials cost has been assessed for this requirement.

9 The mailing cost is calculated in the following manner: 3 pages x $0.05 = $0.15.

10 The mailing cost is calculated in the following manner: 10 pages x $0.05 + $0.63 for a 1 oz First Class Postage = $1.13.

11 The mailing cost is calculated in the following manner: 20 pages x $0.05 + $1.11 for a 3 oz First Class Postage = $2.11.

11