Multiemployer pension plans that intend to apply for Special Financial Assistance (SFA) from the Pension Benefit Guaranty Corporation should pay attention to the PBGC’s schedule for reviewing applications and may want to consider submitting a lock-in application, panelists said during a session on the SFA program at the 68th Annual Employee Benefits Conference in Las Vegas, Nevada.

In the session “American Rescue Plan Act (ARPA): Special Financial Assistance (SFA) for Multiemployer Pension Plans,” recorded on October 25, 2022, presenters Jason L. Russell and Neal S. Schelberg reviewed key changes included in the July 2022 final rule on the SFA program. Russell is a senior vice president and actuary at Segal, and Schelberg is a partner at Proskauer Rose LLP.

The speakers explained the impact of notable changes under the PBGC final rule, which identifies which plans will be given priority to file applications before March 11, 2023 (dubbed “nonpriority plans”) and facilitates the application process for eligible plans after the priority period ends. PBGC will continue to process existing applications and manage the pipeline for upcoming applications. For eligible plans that intend to apply for SFA in the future, this post reviews what to expect after the priority period ends and considerations for lock-in applications,which are intended to avoid problems if PBGC has temporarily closed the e-filing portal.

SFA Priority Groups

ARPA designated priority groups during the two-year priority period ending March 11, 2023 to enable PBGC to conduct an expeditious and thorough review of applications within 120 days and to deliver SFA payments sooner to those plans that are insolvent or have had participants’ benefits reduced via the Multiemployer Pension Reform Act (MPRA). Priority groups 1-4 are open and group 5 opens on November 15, 2022. PBGC’s final rule said it will publish a list of any plans in priority group 6 by November 15, 2022. Tentatively, group 6 will open February 11, 2023. PBGC has the flexibility to accelerate dates or publish other lists of plans and could create more priority groups. An estimated 100 plans are eligible for priority groups.

Ultimately—and no later than March 11, 2023—PBGC’s online application (e-filing) portal will be opened to all eligible plans (regardless of whether they are in a statutory priority category) to ensure that every prospective applicant has a fair opportunity to file its application during the statutory period ending December 31, 2025 for an initial application (or December 31, 2026 for a revised or supplemented application).

Priority Period Ending on March 11, 2023

Nonpriority plans (approximately 200 plans, based on Form 5500 data) can apply after March 11, 2023. PBGC’s 120-day deadline to review applications does not change. Under a so-called “metering system,” PBGC will temporarily close the filing window once the number of applications reaches PBGC’s capacity and will reopen the window when it again has the capacity to process more applications. What’s it going to look like if 200 plans apply at the same time? It is expected that PBGC will need to temporarily close the portal during the nonpriority period, whereas PBGC was able to keep the portal open during the priority period.

Lock-In Notice of Intent to File

The final rule created the lock-in concept in response to a commenter’s remark that the metering system could cause administrative headaches for plans. That’s because plans would prepare their initial application for submission on a particular date, with the plan’s SFA measurement date and other base data aligned with that date. However, the plan may be prevented from filing on that date because the filing window has closed temporarily. If the closure extends into the next calendar quarter, the application may have to be significantly revised.

As a solution to the problem, the commenter suggested that PBGC could allow plans that were ready to file an application but were unable to do so because the filing window closed temporarily to submit a ‘‘notice of intent to file’’ that would lock in the plan’s SFA measurement date and other base data. The suggested notice would allow the plan to apply on a different date when the filing window reopened but with the same application.

PBGC implemented this suggestion and created a mechanism for ‘‘locking in’’ a plan’s SFA measurement date and other base data. This option is available for all plans that file after March 11, 2023 and on or before December 31, 2025. Lock-in also is available for plans in priority groups 5 and 6 as well as any additional priority group that PBGC may add before March 11, 2023 if PBGC temporarily closes the filing window when it is otherwise accepting applications for plans in those priority groups.

A lock-in application is a pro forma initial application submitted via email and containing the plan’s identifying information, a statement of intent to lock in the plan’s base data, a certification signed by an authorized trustee and other information. Lock-in provides a mechanism for plans to set the SFA measurement date so that assumptions and data can be set in advance of submitting the application.

Lock-In Considerations

Lock-in is an important concept for plans that intend to apply in the future because it eliminates the need to rework applications not yet submitted and avoids conflict with the closed e-filing portal, Russell explained. If the e-filing portal is closed, Russell and Schelberg said trustees should consider the following when deciding whether to file a lock-in application.


  • Interest rates
  • Investment returns
  • Industry activity
  • Other experience
  • When will PBGC allow locked-in plans to submit their actual applications?
  • Will PBGC give higher priority to locked-in plans than to others?

Expected advantages

  • Lock in before interest rates rise further
  • Lock in lower asset value before a market recovery
  • Lock in plan data before an experience gain
  • Add certainty to the eventual SFA application

Possible disadvantages

  • Give up downside protection (lock in before another market decline)
  • Lock in before a decline in the contribution base
  • Lock in plan data before an experience loss

A significant unknown factor is the likelihood of interest rates continuing to rise. Russell reminded the audience that a higher interest rate will calculate to lower SFA amounts; the lower the interest rate, the more potential liability, resulting in more SFA money approved for plans. Schelberg summed up by saying that small changes in the market (e.g., interest rates go up 25 basis points) could have a very significant impact on SFA calculations.

Planning Ahead

Plans should allot more than six weeks to complete the application, Russell suggested. PBGC will continue preapplication consultation meetings, as requested via email at During a preapplication conference, trustees and service providers can seek PBGC input on certain SFA assumptions and other questions on the application; however, PBGC guidance during conferences is nonbinding. As March 11, 2023 approaches, it’s unknown whether PBGC will be overwhelmed with requests for preapplication conferences.

Visit the ARPA Special Financial Assistance Program dedicated page for the latest from PBGC. The International Foundation will keep you up to date on developments.

Developed by International Foundation Information Center staff. This does not constitute legal advice. Please consult your plan professionals for legal advice.

Jenny Gartman, CEBS
Manager, Reference/Research Services at the International Foundation

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Jenny Gartman, CEBS

Manager, Reference/Research Services at the International Foundation

Favorite Foundation Member Service: Personalized Research Service

Benefits Topics That Interest Her Most: Mental health and retirement security

Personal Insight: Jenny likes spending time with family, knitting, reading memoirs and going for walks around the neighborhood.

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