Text of H.R. 3396 (103rd): Retirement Protection Act of 1994 (Reported by House Committee version)

The text of the bill below is as of Aug 26, 1994 (Reported by House Committee). The bill was not enacted into law.

HR 3396 RH

Union Calendar No. 391

103d CONGRESS

2d Session

H. R. 3396

[Report No. 103-632, Parts I and II]

To amend the Employee Retirement Income Security Act of 1974 and the Internal Revenue Code of 1986 to provide security for workers, to improve pension plan funding, to limit growth in insurance exposure, to protect the single-employer plan termination insurance program, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

OCTOBER 28, 1993

Mr. FORD of Michigan (for himself and Mr. ROSTENKOWSKI) (both by request) introduced the following bill; which was referred jointly to the Committees on Education and Labor and Ways and Means

July 19, 1994

Additional sponsors: Mr. PICKLE, Mr. HOUGHTON, and Mr. Zeliff

July 29, 1994

Reported from the Committee on Ways and Means with an amendment

[Strike out all after the enacting clause and insert the part printed in italic]

AUGUST 26, 1994

Reported from the Committee on Education and Labor with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

[Strike out all after the enacting clause and insert the part printed in bold face roman]

[For text of introduced bill, see copy of bill as introduced on October 28, 1993]

A BILL

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) SHORT TITLE- This Act may be cited as the ‘Retirement Protection Act of 1994’.

(b) TABLE OF CONTENTS-

Sec. 1. Short title and table of contents.

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Internal Revenue Code of 1986

Sec. 101. Minimum funding requirements.

Sec. 102. Limitation on changes in current liability assumptions.

Sec. 103. Anticipation of bargained benefit increases.

Sec. 104. Modification of quarterly contribution requirement.

Sec. 105. Exceptions to excise tax on nondeductible contributions.

Subtitle B--Amendments to the Employee Retirement Income Security Act of 1974

Sec. 121. Minimum funding requirements.

Sec. 122. Limitation on changes in current liability assumptions.

Sec. 123. Anticipation of bargained benefit increases.

Sec. 124. Modification of quarterly contribution requirement.

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

Sec. 201. Reportable events.

Sec. 202. Alternative to involuntary termination.

Sec. 203. Certain information required to be furnished to PBGC.

Sec. 204. Liability upon liquidation of contributing sponsor or controlled group member where plan remains ongoing.

Sec. 205. Enforcement of minimum funding requirements.

Sec. 206. Remedies for noncompliance with requirements for standard termination.

Sec. 207. Prohibition on benefit increases where plan sponsor is in bankruptcy.

Sec. 208. Substantial owner benefits.

Sec. 209. Phase-out of variable rate premium cap.

TITLE III--PARTICIPANT SERVICES

Sec. 301. Disclosure to participants.

Sec. 302. Missing participants.

Sec. 303. Modification of maximum guarantee for disability benefits.

TITLE IV--MISCELLANEOUS AMENDMENTS

Sec. 401. ERISA citation.

Sec. 402. Definition of contributing sponsor.

Sec. 403. Distress termination criteria for banking institutions.

Sec. 404. Single sum distributions.

Sec. 405. Adjustments to lien for missed minimum funding contributions.

Sec. 406. Rounding rules for cost-of-living adjustments.

Sec. 407. Funding of restored plans.

Sec. 408. Study of funding status of Federal, State, and local government pension plans.

TITLE V--EFFECTIVE DATES

Sec. 501. Effective dates.

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Internal Revenue Code of 1986

SEC. 101. MINIMUM FUNDING REQUIREMENTS.

(a) Amendments to Additional Funding Requirements for Single-Employer Plans-

(1) LIMITATION OF ADDITIONAL FUNDING REQUIREMENT TO PLANS HAVING A FUNDED CURRENT LIABILITY PERCENTAGE OF LESS THAN 90 PERCENT- Paragraph (1) of section 412(l) of the Internal Revenue Code of 1986 (relating to additional funding requirements for plans which are not multiemployer plans) is amended by striking ‘which has an unfunded current liability’ and inserting ‘which has a funded current liability percentage of less than 90 percent’.

(2) Relationship of additional funding requirement to funding standard account charges and credits-

(A) Clause (ii) of section 412(l)(1)(A) of such Code is amended to read as follows:

‘(ii) the sum of the charges for such plan year under subsection (b)(2), reduced by the sum of the credits for such plan year under subparagraph (B) of subsection (b)(3), plus’.

(B) The last sentence in section 412(l)(1) of such Code is amended to read as follows:

‘Such increase shall not exceed the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.’

(3) AMENDMENT TO DEFICIT REDUCTION CONTRIBUTION- Paragraph (2) of section 412(l) of such Code is amended--

(A) by striking ‘plus’ at the end of subparagraph (A),

(B) by striking the period at the end of subparagraph (B) and inserting ‘, plus’; and

(C) by adding at the end the following new subparagraph:

‘(C) the expected increase in current liability due to benefits accruing during the plan year.’

(4) Increase in current liability due to change in required assumptions-

(A) Paragraph (3) of section 412(l) of such Code is amended by adding at the end the following new subparagraph:

‘(D) Special rule for required changes in actuarial assumptions-

‘(i) IN GENERAL- The unfunded old liability amount with respect to any plan for any plan year shall be increased by the amount necessary to amortize the amount of additional unfunded old liability under the plan in equal annual installments over a period of 12 plan years (beginning with the first plan year beginning after December 31, 1994).

‘(ii) ADDITIONAL UNFUNDED OLD LIABILITY- For purposes of clause (i), the term ‘additional unfunded old liability’ means the amount (if any) by which--

‘(I) the current liability of the plan as of the beginning of the first plan year beginning after December 31, 1994, valued using the assumptions required by paragraph (7)(C) as in effect for plan years beginning after December 31, 1994, exceeds

‘(II) the current liability of the plan as of the beginning of such first plan year, valued using the same assumptions used under subclause (I) (other than the assumptions required by paragraph (7)(C)), using the prior interest rate, and using such mortality assumptions as were used to determine current liability for the first plan year beginning after December 31, 1992.

‘(iii) PRIOR INTEREST RATE- For purposes of clause (ii), the term ‘prior interest rate’ means the rate of interest that is the same percentage of the weighted average under subsection (b)(5)(B)(ii)(I) for the first plan year beginning after December 31, 1994, as the rate of interest used by the plan to determine current liability for the first plan year beginning after December 31, 1992, is of the weighted average under subsection (b)(5)(B)(ii)(I) for such first plan year beginning after December 31, 1992.’

(5) APPLICABLE PERCENTAGE FOR DETERMINING UNFUNDED NEW LIABILITY AMOUNT- Subparagraph (C) of section 412(l)(4) of such Code is amended--

(A) by striking ‘.25’ and inserting ‘.40’, and

(B) by striking ‘35’ and inserting ‘60’.

(6) UNPREDICTABLE CONTINGENT EVENT AMOUNT-

(A) Subparagraph (A) of section 412(l)(5) of such Code is amended--

(i) by striking ‘greater of’ and inserting ‘greatest of’ before clause (i);

(ii) by striking ‘or’ at the end of clause (i);

(iii) by striking the period at the end of clause (ii) and inserting ‘, or’; and

(iv) by adding after clause (ii) the following new clause:

‘(iii) the additional amount that would be determined under paragraph (4)(A) if the unpredictable contingent event benefit liabilities were included in unfunded new liability notwithstanding paragraph (4)(B)(ii).’

(B) Paragraph (5) of section 412(l) of such Code is amended by adding at the end the following new subparagraph:

‘(E) LIMITATION- The present value of the amounts described in subparagraph (A) with respect to any one event shall not exceed the unpredictable contingent event benefit liabilities attributable to that event.’

(C) Clause (ii) of section 412(m)(4)(D) of such Code is amended--

(i) by striking ‘greater of’ and inserting ‘greatest of’ before subclause (I);

(ii) by striking ‘or’ at the end of subclause (I);

(iii) by striking the period at the end of subclause (II) and inserting ‘, or’; and

(iv) by adding after subclause (II) the following new clause:

‘(III) 25 percent of the amount determined under subsection (l)(5)(A)(iii) for the plan year.’

(7) REQUIRED INTEREST RATE AND MORTALITY ASSUMPTIONS FOR DETERMINING CURRENT LIABILITY- Subparagraph (C) of section 412(l)(7) of such Code is amended to read as follows:

‘(C) INTEREST RATE AND MORTALITY ASSUMPTIONS USED- Effective for plan years beginning after December 31, 1994--

‘(i) the rate of interest used to determine current liability under this subsection shall be the rate of interest used under subsection (b)(5), except that the highest rate in the permissible range under subparagraph (B)(ii) thereof shall not exceed 100 percent of the weighted average referred to in such subparagraph, and

‘(ii) the mortality table used to determine current liability under this subsection shall be the table prescribed by the Secretary.

(8) TRANSITION RULE- Section 412(l) of such Code is amended by adding at the end the following new paragraph:

‘(9) PHASEIN OF INCREASES IN FUNDING REQUIRED BY RETIREMENT PROTECTION ACT OF 1994-

‘(A) IN GENERAL- For any applicable plan year, at the election of the employer, the increase under paragraph (1) shall not exceed the greater of--

‘(i) the increase that would be required under paragraph (1) if the provisions of this title as in effect for plan years beginning before January 1, 1995, had remained in effect, or

‘(ii) the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) for the applicable plan year to a percentage equal to the sum of the initial funded current liability percentage of the plan plus the applicable number of percentage points for such applicable plan year.

‘(B) APPLICABLE NUMBER OF PERCENTAGE POINTS-

‘(i) INITIAL FUNDED CURRENT LIABILITY PERCENTAGE OF 75 PERCENT OR LESS- Except as provided in clause (ii), for plans with an initial funded current liability percentage of 75 percent or less, the applicable number of percentage points for the applicable plan year is:
‘In the case

--The applicable

of applicable

--number of

plan years

--percentage

beginning in:

--points is:

1995

--3

1996

--6

1997

--9

1998

--12

1999

--15

2000

--19

2001

--24.

‘(ii) OTHER CASES- In the case of a plan to which this clause applies, the applicable number of percentage points for any such applicable plan year is the sum of--

‘(I) 2 percentage points;

‘(II) the applicable number of percentage points (if any) under this clause for the preceding applicable plan year;

‘(III) the product of .10 multiplied by the excess (if any) of (a) 85 percentage points over (b) the sum of the initial funded current liability percentage and the number determined under subclause (II);

‘(IV) for applicable plan years beginning in 2000, 1 percentage point; and

‘(V) for applicable plan years beginning in 2001, 2 percentage points.

‘(iii) PLANS TO WHICH CLAUSE (ii) APPLIES-

‘(I) IN GENERAL- Clause (ii) shall apply to a plan for an applicable plan year if the initial funded current liability percentage of such plan is more than 75 percent.

‘(II) PLANS INITIALLY UNDER CLAUSE (i)- In the case of a plan which (but for this subclause) has an initial funded current liability percentage of 75 percent or less, clause (ii) (and not clause (i)) shall apply to such plan with respect to applicable plan years beginning after the first applicable plan year for which the sum of the initial funded current liability percentage and the applicable number of percentage points (determined under clause (i)) exceeds 75 percent. For purposes of applying clause (ii) to such a plan, the initial funded current liability percentage of such plan shall be treated as being the sum referred to in the preceding sentence.

‘(C) DEFINITIONS- For purposes of this paragraph--

‘(i) The term ‘applicable plan year’ means a plan year beginning after December 31, 1994, and before January 1, 2002.

‘(ii) The term ‘initial funded current liability percentage’ means the funded current liability percentage as of the first day of the first plan year beginning after December 31, 1994.’

(9) Liquidity requirement-

(A) Section 412(m) of such Code is amended by redesignating paragraph (5) as paragraph (6) and by inserting after paragraph (4) the following new paragraph:

‘(5) LIQUIDITY REQUIREMENT-

‘(A) IN GENERAL- A plan to which this paragraph applies shall be treated as failing to pay the full amount of any required installment to the extent that the value of the liquid assets paid in such installment is less than the liquidity shortfall (whether or not such liquidity shortfall exceeds the amount of such installment required to be paid but for this paragraph).

‘(B) PLANS TO WHICH PARAGRAPH APPLIES- This paragraph shall apply to a defined benefit plan to which subsection (l) applies and which--

‘(i) is required to pay installments under this subsection for a plan year, and

‘(ii) has a liquidity shortfall for any quarter during such plan year.

‘(C) PERIOD OF UNDERPAYMENT- For purposes of paragraph (1), any portion of an installment that is treated as not paid under subparagraph (A) shall continue to be treated as unpaid until the close of the quarter in which the due date for such installment occurs.

‘(D) LIMITATION ON INCREASE- If the amount of any required installment is increased by reason of subparagraph (A), in no event shall such increase exceed the amount which, when added to prior installments for the plan year, is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.

‘(E) DEFINITIONS- For purposes of this paragraph--

‘(i) LIQUIDITY SHORTFALL- The term ‘liquidity shortfall’ means, with respect to any required installment, an amount equal to the excess (as of the last day of the quarter for which such installment is made) of the base amount with respect to such quarter over the value (as of such last day) of the plan’s liquid assets.

‘(ii) BASE AMOUNT-

‘(I) IN GENERAL- The term ‘base amount’ means, with respect to any quarter, an amount equal to 3 times the sum of the adjusted disbursements from the plan for the 12 months ending on the last day of such quarter.

‘(II) SPECIAL RULE- If the amount determined under clause (i) exceeds an amount equal to 2 times the sum of the adjusted disbursements from the plan for the 36 months ending on the last day of the quarter and an enrolled actuary certifies to the Secretary that such excess is the result of nonrecurring circumstances, the base amount with respect to such quarter shall be determined without regard to amounts related to those nonrecurring circumstances.

‘(iii) DISBURSEMENTS FROM THE PLAN- The term ‘disbursements from the plan’ means all disbursements from the trust, including purchases of annuities, payments of single sums and other benefits, and administrative expenses.

‘(iv) ADJUSTED DISBURSEMENTS- The term ‘adjusted disbursements’ means disbursements from the plan reduced by the product of--

‘(I) the plan’s funded current liability percentage (as defined in subsection (l)(8)) for the plan year, and

‘(II) the sum of the purchases of annuities, payments of single sums, and such other disbursements as the Secretary shall provide in regulations.

‘(v) LIQUID ASSETS- The term ‘liquid assets’ means cash, marketable securities and such other assets as specified by the Secretary in regulations.

‘(vi) QUARTER- The term ‘quarter’ means, with respect to any required installment, the 3-month period preceding the month in which the due date for such installment occurs.

‘(F) REGULATIONS- The Secretary may prescribe such regulations as are necessary to carry out this paragraph.’

(B) EXCISE TAX ON UNPAID LIQUIDITY SHORTFALL-

(i) Subsection (e) of section 4971 of such Code is amended by striking ‘(a) or (b)’ wherever it appears and replacing it with ‘(a), (b) or (f)’.

(ii) Section 4971 of such Code is amended by redesignating subsection (f) as subsection (g) and adding a new subsection (f) to read as follows:

‘(f) FAILURE TO PAY LIQUIDITY SHORTFALL-

‘(1) IN GENERAL- In the case of a plan to which section 412(m)(5) applies, there is hereby imposed a tax of 10 percent of the excess (if any) of--

‘(A) the amount of the liquidity shortfall for any quarter, over

‘(B) the amount of such shortfall which is paid by the required installment under section 412(m) for such quarter (but only if such installment is paid on or before the due date for such installment).

‘(2) ADDITIONAL TAX- If the plan has a liquidity shortfall as of the close of any quarter and as of the close of each of the following 4 quarters, there is hereby imposed a tax equal to 100 percent of the amount on which tax was imposed by paragraph (1) for such first quarter.

‘(3) DEFINITIONS AND SPECIAL RULE-

‘(A) LIQUIDITY SHORTFALL; QUARTER- For purposes of this subsection, the terms ‘liquidity shortfall’ and ‘quarter’ have the respective meanings given such terms by section 412(m)(5).

‘(B) SPECIAL RULE- If the tax imposed by paragraph (2) is paid with respect to any liquidity shortfall for any quarter, no further tax shall be imposed by this subsection on such shortfall for such quarter.’

(C) TREATMENT OF FAILURE TO MAKE CERTAIN PAYMENTS IF PLAN HAS LIQUIDITY SHORTFALL- Section 401(a) of such Code is amended by adding at the end the following new paragraph:

‘(32) TREATMENT OF FAILURE TO MAKE CERTAIN PAYMENTS IF PLAN HAS LIQUIDITY SHORTFALL-

‘(A) IN GENERAL- A trust forming part of a pension plan to which section 412(m)(5) applies shall not be treated as failing to constitute a qualified trust under this section merely because such plan ceases to make any payment described in subparagraph (B) during any period that such plan has a liquidity shortfall (as defined in section 412(m)(5)).

‘(B) PAYMENTS DESCRIBED- A payment is described in this subparagraph if such payment is--

‘(i) any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of section 411(a)(9)), to a participant or beneficiary whose annuity starting date (as defined in section 417(f)(2)) occurs during the period referred to in subparagraph (A),

‘(ii) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and

‘(iii) any other payment specified by the Secretary by regulations.

‘(C) PERIOD OF SHORTFALL- For purposes of this paragraph, a plan has a liquidity shortfall during the period that there is an underpayment of an installment under section 412(m) by reason of paragraph (5)(A) thereof.’

(10) AMENDMENT TO DEFINITION OF FULL FUNDING LIMITATION-

(A) Subparagraph (A) of section 412(c)(7) of such Code is amended--

(i) by inserting ‘(including the expected increase in current liability due to benefits accruing during the plan year)’ after ‘current liability’ in clause (i), and

(ii) by adding at the end the following flush sentences:

‘In no event shall the excess described in the preceding sentence for any plan year be less than the unfunded current liability (if any) of the plan. For purposes of the preceding sentence, the term ‘unfunded current liability’ has the meaning given such term by subsection (l)(8) (determined without regard to subsection (l)(7)(D)).’

(B) Subparagraph (B) of section 412(c)(7) of such Code is amended to read as follows:

‘(B) CURRENT LIABILITY- For purposes of subparagraph (D) and subclause (I) of subparagraph (A)(i), the term ‘current liability’ has the meaning given such term by subsection (l)(7) (without regard to subparagraphs (C) and (D) thereof) and using the rate of interest used under subsection (b)(5)(B).’

(b) EFFECTIVE DATE- The amendments made by this section shall apply to plan years beginning after December 31, 1994.

SEC. 102. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

(a) IN GENERAL- Paragraph (5) of section 412(c) of the Internal Revenue Code of 1986 is amended--

(1) by striking ‘If the funding method’ and inserting the following:

‘(A) IN GENERAL- If the funding method’, and

(2) by adding at the end the following new subparagraph:

‘(B) APPROVAL REQUIRED FOR CERTAIN CHANGES IN ASSUMPTIONS BY CERTAIN SINGLE EMPLOYER PLANS SUBJECT TO ADDITIONAL FUNDING REQUIREMENT-

‘(i) IN GENERAL- No actuarial assumption (other than the assumptions described in subsection (l)(7)(C)) used to determine the current liability for a plan to which this subparagraph applies may be changed without the approval of the Secretary.

‘(ii) PLANS TO WHICH SUBPARAGRAPH APPLIES- This subparagraph shall apply to a plan only if--

‘(I) subsection (l) applies to the plan;

‘(II) the employer (within the meaning of section 412(c)(11) (without regard to subparagraph (B) thereof)) maintaining such plan is described in section 4043(b)(1) of the Employee Retirement Income Security Act of 1974; and

‘(III) the change in assumptions (determined after taking into account any changes in interest rate and mortality table) results in a decrease in the unfunded current liability of the plan for the current plan year that is $50,000,000 or greater, or that is $5,000,000 or greater and that is 5 percent or more of the current liability of the plan before such change.’

(b) EFFECTIVE DATE-

(1) IN GENERAL- The amendment made by this section shall apply to changes in assumptions for plan years beginning after October 28, 1993.

(2) CERTAIN CHANGES CEASE TO BE EFFECTIVE- In the case of changes in assumptions for plan years beginning after December 31, 1992, and on or before October 28, 1993, such changes shall cease to be effective for plan years beginning after December 31, 1994, if--

(A) such change would have required the approval of the Secretary of the Treasury had such amendment applied to such change, and

(B) such change is not so approved.

SEC. 103. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

(a) IN GENERAL- Section 412(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

‘(12) ANTICIPATION OF BENEFIT INCREASES EFFECTIVE IN THE FUTURE- In determining projected benefits, the funding method of a collectively bargained plan described in section 413(a) (other than a multiemployer plan) shall anticipate benefit increases scheduled to take effect during the term of the collective bargaining agreement applicable to the plan.’

(b) EFFECTIVE DATE- The amendment made by this section shall apply to plan years beginning after December 31, 1994, with respect to collective bargaining agreements in effect on or after January 1, 1995.

SEC. 104. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

(a) IN GENERAL- Paragraph (1) of section 412(m) of the Internal Revenue Code of 1986 is amended--

(1) by inserting ‘which has a funded current liability percentage (as defined in subsection (l)(8)) for the preceding plan year of less than 100 percent’ before ‘fails’, and

(2) by striking ‘any plan year’ and inserting ‘the plan year’.

(b) EFFECTIVE DATE- The amendment made by this section shall apply to plan years beginning after the date of enactment of this Act.

SEC. 105. EXCEPTIONS TO EXCISE TAX ON NONDEDUCTIBLE CONTRIBUTIONS.

(a) IN GENERAL- Section 4972(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

‘(6) EXCEPTIONS- In determining the amount of nondeductible contributions for any taxable year, there shall not be taken into account--

‘(A) contributions that would be deductible under section 404(a)(1)(D) if the plan had more than 100 participants if--

‘(i) the plan is covered under section 4021 of the Employee Retirement Income Security Act of 1974, and

‘(ii) the plan is terminated under section 4041(b) of such Act on or before the last day of the taxable year, and

‘(B) contributions described in section 401(m)(4)(A) or 402(g)(3)(A) which--

‘(i) do not exceed 6 percent of compensation (within the meaning of section 404(a)(7)(A)(i)) paid or accrued (during the taxable year for which the contributions were made) to beneficiaries under the plan, and

‘(ii) are not deductible when contributed solely because of section 404(a)(7).

Subparagraph (B) shall apply to a defined benefit plan only if such plan is described in section 404(a)(1)(D). For purposes of subparagraph (B), the deductible limits under section 404(a)(7) shall first be applied to amounts contributed to a defined benefit plan and then to amounts described in subparagraph (B).’

(b) EFFECTIVE DATE-

(1) SECTION 4972(c)(6)(A)- Section 4972(c)(6)(A) of the Internal Revenue Code of 1986 (as added by this section) shall apply to taxable years ending on or after the date of enactment of this Act.

(2) SECTION 4972(c)(6)(B)- Section 4972(c)(6)(B) of such Code (as added by this section) shall apply to taxable years ending on or after December 31, 1992.

Subtitle B--Amendments to the Employee Retirement Income Security Act of 1974

SEC. 121. MINIMUM FUNDING REQUIREMENTS.

(a) AMENDMENTS TO ADDITIONAL FUNDING REQUIREMENTS FOR SINGLE-EMPLOYER PLANS-

(1) LIMITATION OF ADDITIONAL FUNDING REQUIREMENT TO PLANS HAVING A FUNDED CURRENT LIABILITY PERCENTAGE OF LESS THAN 90 PERCENT- Paragraph (1) of section 302(d) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(d)) is amended by striking ‘which has an unfunded current liability’ and inserting ‘which has a funded current liability percentage of less than 90 percent’.

(2) RELATIONSHIP OF ADDITIONAL FUNDING REQUIREMENT TO FUNDING STANDARD ACCOUNT CHARGES AND CREDITS-

(A) Clause (ii) of section 302(d)(1)(A) of such Act is amended to read as follows:

‘(ii) the sum of the charges for such plan year under subsection (b)(2), reduced by the sum of the credits for such plan year under subparagraph (B) of subsection (b)(3), plus’.

(B) The last sentence in section 302(d)(1) of such Act is amended to read as follows:

‘Such increase shall not exceed the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.’

(3) AMENDMENT TO DEFICIT REDUCTION CONTRIBUTION- Paragraph (2) of section 302(d) of such Act is amended--

(A) by striking ‘plus’ at the end of subparagraph (A);

(B) by striking the period at the end of subparagraph (B) and inserting ‘, plus’; and

(C) by adding at the end the following new subparagraph:

‘(C) the expected increase in current liability due to benefits accruing during the plan year.’

(4) Increase in current liability due to change in required assumptions-

(A) Paragraph (3) of section 302(d) of such Act is amended by adding at the end the following new subparagraph:

‘(D) Special rule for required changes in actuarial assumptions-

‘(i) IN GENERAL- The unfunded old liability amount with respect to any plan for any plan year shall be increased by the amount necessary to amortize the amount of additional unfunded old liability under the plan in equal annual installments over a period of 12 plan years (beginning with the first plan year beginning after December 31, 1994).

‘(ii) ADDITIONAL UNFUNDED OLD LIABILITY- For purposes of clause (i), the term ‘additional unfunded old liability’ means the amount (if any) by which--

‘(I) the current liability of the plan as of the beginning of the first plan year beginning after December 31, 1994, valued using the assumptions required by paragraph (7)(C) as in effect for plan years beginning after December 31, 1994, exceeds

‘(II) the current liability of the plan as of the beginning of such first plan year, valued using the same assumptions used under subclause (I) (other than the assumptions required by paragraph (7)(C)), using the prior interest rate, and using such mortality assumptions as were used to determine current liability for the first plan year beginning after December 31, 1992.

‘(iii) PRIOR INTEREST RATE- For purposes of clause (ii), the term ‘prior interest rate’ means the rate of interest that is the same percentage of the weighted average under subsection (b)(5)(B)(ii)(I) for the first plan year beginning after December 31, 1994, as the rate of interest used by the plan to determine current liability for the first plan year beginning after December 31, 1992, is of the weighted average under subsection (b)(5)(B)(ii)(I) for such first plan year beginning after December 31, 1992.’

(5) APPLICABLE PERCENTAGE FOR DETERMINING UNFUNDED NEW LIABILITY AMOUNT- Subparagraph (C) of section 302(d)(4) of such Act is amended--

(A) by striking ‘.25’ and inserting ‘.40’, and

(B) by striking ‘35’ and inserting ‘60’.

(6) UNPREDICTABLE CONTINGENT EVENT AMOUNT-

(A) Subparagraph (A) of section 302(d)(5) of such Act is amended--

(i) by striking ‘greater of’ and inserting ‘greatest of’ before clause (i);

(ii) by striking ‘or’ at the end of clause (i);

(iii) by striking the period at the end of clause (ii) and inserting ‘, or’; and

(iv) by adding after clause (ii) the following new clause:

‘(iii) the additional amount that would be determined under paragraph (4)(A) if the unpredictable contingent event benefit liabilities were included in unfunded new liability notwithstanding paragraph (4)(B)(ii).’

(B) Paragraph (5) of section 302(d) of such Act is amended by adding at the end the following new subparagraph:

‘(E) LIMITATION- The present value of the amounts described in subparagraph (A) with respect to any one event shall not exceed the unpredictable contingent event benefit liabilities attributable to that event.’

(C) Clause (ii) of section 302(e)(4)(D) of such Act is amended--

(i) by striking ‘greater of’ and inserting ‘greatest of’ before subclause (I);

(ii) by striking ‘or’ at the end of subclause (I);

(iii) by striking the period at the end of subclause (II) and inserting ‘, or’; and

(iv) by adding after subclause (II) the following new clause:

‘(III) 25 percent of the amount determined under subsection (d)(5)(A)(iii) for the plan year.’

(7) REQUIRED INTEREST RATE AND MORTALITY ASSUMPTIONS FOR DETERMINING CURRENT LIABILITY- Subparagraph (C) of section 302(d)(7) of such Act is amended to read as follows:

‘(C) INTEREST RATE AND MORTALITY ASSUMPTIONS USED- Effective for plan years beginning after December 31, 1994--

‘(i) the rate of interest used to determine current liability under this subsection shall be the rate of interest used under subsection (b)(5), except that the highest rate in the permissible range under subparagraph (B)(ii) thereof shall not exceed 100 percent of the weighted average referred to in such subparagraph, and

‘(ii) the mortality table used to determine current liability under this subsection shall be the table prescribed by the Secretary of the Treasury.

(8) TRANSITION RULE- Section 302(d) of such Act is amended by adding at the end the following new paragraph:

‘(9) PHASEIN OF INCREASES IN FUNDING REQUIRED BY RETIREMENT PROTECTION ACT OF 1994-

‘(A) IN GENERAL- For any applicable plan year, at the election of the employer, the increase under paragraph (1) shall not exceed the greater of--

‘(i) the increase that would be required under paragraph (1) if the provisions of this title as in effect for plan years beginning before January 1, 1995, had remained in effect, or

‘(ii) the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) for the applicable plan year to a percentage equal to the sum of the initial funded current liability percentage of the plan plus the applicable number of percentage points for such applicable plan year.

‘(B) APPLICABLE NUMBER OF PERCENTAGE POINTS-

‘(i) INITIAL FUNDED CURRENT LIABILITY PERCENTAGE OF 75 PERCENT OR LESS- Except as provided in clause (ii), for plans with an initial funded current liability percentage of 75 percent or less, the applicable number of percentage points for the applicable plan year is:
‘In the case

--The applicable

of applicable

--number of

plan years

--percentage

beginning in:

--points is:

1995

--3

1996

--6

1997

--9

1998

--12

1999

--15

2000

--19

2001

--24.

‘(ii) OTHER CASES- In the case of a plan to which this clause applies, the applicable number of percentage points for any such applicable plan year is the sum of--

‘(I) 2 percentage points;

‘(II) the applicable number of percentage points (if any) under this clause for the preceding applicable plan year;

‘(III) the product of .10 multiplied by the excess (if any) of (a) 85 percentage points over (b) the sum of the initial funded current liability percentage and the number determined under subclause (II);

‘(IV) for applicable plan years beginning in 2000, 1 percentage point; and

‘(V) for applicable plan years beginning in 2001, 2 percentage points.

‘(iii) PLANS TO WHICH CLAUSE (ii) APPLIES-

‘(I) IN GENERAL- Clause (ii) shall apply to a plan for an applicable plan year if the initial funded current liability percentage of such plan is more than 75 percent.

‘(II) PLANS INITIALLY UNDER CLAUSE (i)- In the case of a plan which (but for this subclause) has an initial funded current liability percentage of 75 percent or less, clause (ii) (and not clause (i)) shall apply to such plan with respect to applicable plan years beginning after the first applicable plan year for which the sum of the initial funded current liability percentage and the applicable number of percentage points (determined under clause (i)) exceeds 75 percent. For purposes of applying clause (ii) to such a plan, the initial funded current liability percentage of such plan shall be treated as being the sum referred to in the preceding sentence.

‘(C) DEFINITIONS- For purposes of this paragraph--

‘(i) The term ‘applicable plan year’ means a plan year beginning after December 31, 1994, and before January 1, 2002.

‘(ii) The term ‘initial funded current liability percentage’ means the funded current liability percentage as of the first day of the first plan year beginning after December 31, 1994.’

(9) LIQUIDITY REQUIREMENT-

(A) Section 302(e) of such Act is amended by redesignating paragraph (5) as paragraph (6) and by inserting after paragraph (4) the following new paragraph:

‘(5) LIQUIDITY REQUIREMENT-

‘(A) IN GENERAL- A plan to which this paragraph applies shall be treated as failing to pay the full amount of any required installment to the extent that the value of the liquid assets paid in such installment is less than the liquidity shortfall (whether or not such liquidity shortfall exceeds the amount of such installment required to be paid but for this paragraph).

‘(B) PLANS TO WHICH PARAGRAPH APPLIES- This paragraph shall apply to a defined benefit plan to which subsection (d) applies and which--

‘(i) is required to pay installments under this subsection for a plan year, and

‘(ii) has a liquidity shortfall for any quarter during such plan year.

‘(C) PERIOD OF UNDERPAYMENT- For purposes of paragraph (1), any portion of an installment that is treated as not paid under subparagraph (A) shall continue to be treated as unpaid until the close of the quarter in which the due date for such installment occurs.

‘(D) LIMITATION ON INCREASE- If the amount of any required installment is increased by reason of subparagraph (A), in no event shall such increase exceed the amount which, when added to prior installments for the plan year, is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.

‘(E) DEFINITIONS- For purposes of this paragraph--

‘(i) LIQUIDITY SHORTFALL- The term ‘liquidity shortfall’ means, with respect to any required installment, an amount equal to the excess (as of the last day of the quarter for which such installment is made) of the base amount with respect to such quarter over the value (as of such last day) of the plan’s liquid assets.

‘(ii) BASE AMOUNT-

‘(I) IN GENERAL- The term ‘base amount’ means, with respect to any quarter, an amount equal to 3 times the sum of the adjusted disbursements from the plan for the 12 months ending on the last day of such quarter.

‘(II) SPECIAL RULE- If the amount determined under clause (i) exceeds an amount equal to 2 times the sum of the adjusted disbursements from the plan for the 36 months ending on the last day of the quarter and an enrolled actuary certifies to the Secretary of the Treasury that such excess is the result of nonrecurring circumstances, the base amount with respect to such quarter shall be determined without regard to amounts related to those nonrecurring circumstances.

‘(iii) DISBURSEMENTS FROM THE PLAN- The term ‘disbursements from the plan’ means all disbursements from the trust, including purchases of annuities, payments of single sums and other benefits, and administrative expenses.

‘(iv) ADJUSTED DISBURSEMENTS- The term ‘adjusted disbursements’ means disbursements from the plan reduced by the product of--

‘(I) the plan’s funded current liability percentage (as defined in subsection (d)(8)) for the plan year, and

‘(II) the sum of the purchases of annuities, payments of single sums, and such other disbursements as the Secretary of the Treasury shall provide in regulations.

‘(v) LIQUID ASSETS- The term ‘liquid assets’ means cash, marketable securities and such other assets as specified by the Secretary of the Treasury in regulations.

‘(vi) QUARTER- The term ‘quarter’ means, with respect to any required installment, the 3-month period preceding the month in which the due date for such installment occurs.

‘(F) REGULATIONS- The Secretary of the Treasury may prescribe such regulations as are necessary to carry out this paragraph.’

(B) LIMITATION ON DISTRIBUTIONS OTHER THAN LIFE ANNUITIES PAID BY THE PLAN-

(i) Section 204 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1054) is amended by redesignating subsection (i) as (j) and inserting a new subsection (i) to read as follows:

‘(i) Limitation on Distributions Other Than Life Annuities Paid By The Plan-

‘(1) IN GENERAL- Notwithstanding any other provision of this Part, the fiduciary of a pension plan that is subject to the additional funding requirements of section 302(d) shall not permit a prohibited payment to be made from a plan during a period in which such plan has a liquidity shortfall (as defined in section 302(e)(5)).

‘(2) PROHIBITED PAYMENT- For purposes of paragraph (1), the term ‘prohibited payment’ means--

‘(A) any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of section 204(b)(1)(G)), to a participant or beneficiary whose annuity starting date (as defined in section 205(h)(2)), that occurs during the period referred to in paragraph (1),

‘(B) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and

‘(C) any other payment specified by the Secretary of the Treasury by regulations.

‘(3) PERIOD OF SHORTFALL- For purposes of this subsection, a plan has a liquidity shortfall during the period that there is an underpayment of an installment under section 302(e) by reason of paragraph (5)(A) thereof.

‘(4) COORDINATION WITH OTHER PROVISIONS- Compliance with this subsection shall not constitute a violation of any other provision of this Act.’

(ii) Section 502 of such Act is amended by adding at the end thereof a new subsection (m) to read as follows:

‘(m) In the case of a distribution to a pension plan participant or beneficiary in violation of section 204(i) by a plan fiduciary, the Secretary shall assess a penalty against such fiduciary in an amount equal to the value of the distribution. Such penalty shall not exceed $10,000 for each such distribution.’

(10) AMENDMENT TO DEFINITION OF FULL FUNDING LIMITATION-

(A) Subparagraph (A) of section 302(c)(7) of such Act is amended--

(i) by inserting ‘(including the expected increase in current liability due to benefits accruing during the plan year)’ after ‘current liability’ in clause (i), and

(ii) by adding at the end the following flush sentences:

‘In no event shall the excess described in the preceding sentence for any plan year be less than the unfunded current liability (if any) of the plan. For purposes of the preceding sentence, the term ‘unfunded current liability’ has the meaning given such term by subsection (d)(8) (determined without regard to subsection (d)(7)(D)).’

(B) Subparagraph (B) of section 302(c)(7) of such Act is amended to read as follows:

‘(B) CURRENT LIABILITY- For purposes of subparagraph (D) and subclause (I) of subparagraph (A)(i), the term ‘current liability’ has the meaning given such term by subsection (d)(7) (without regard to subparagraphs (C) and (D) thereof) and using the rate of interest used under subsection (b)(5)(B).’

(b) EFFECTIVE DATE- The amendments made by this section shall apply to plan years beginning after December 31, 1994.

SEC. 122. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

(a) Paragraph (5) of section 302(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(c)(5)) is amended--

(1) by striking ‘If the funding method’ and inserting the following:

‘(A) IN GENERAL- If the funding method’, and

(2) by adding at the end the following new subparagraph:

‘(B) APPROVAL REQUIRED FOR CERTAIN CHANGES IN ASSUMPTIONS BY CERTAIN SINGLE EMPLOYER PLANS SUBJECT TO ADDITIONAL FUNDING REQUIREMENT-

‘(i) IN GENERAL- No actuarial assumption (other than the assumptions described in subsection (d)(7)(C)) used to determine the current liability for a plan to which this subparagraph applies may be changed without the approval of the Secretary of the Treasury.

‘(ii) PLANS TO WHICH SUBPARAGRAPH APPLIES- This subparagraph shall apply to a plan only if--

‘(I) subsection (d) applies to the plan;

‘(II) the employer (within the meaning of section 302(c)(11) (without regard to subparagraph (B) thereof)) maintaining such plan is described in section 4043(b)(1); and

‘(III) the change in assumptions (determined after taking into account any changes in interest rate and mortality table) results in a decrease in the unfunded current liability of the plan for the current plan year that is $50,000,000 or greater, or that is $5,000,000 or greater and that is 5 percent or more of the current liability of the plan before such change.’

(b) EFFECTIVE DATE-

(1) IN GENERAL- The amendment made by this section shall apply to changes in assumptions for plan years beginning after October 28, 1993.

(A) such change would have required the approval of the Secretary of the Treasury had such amendment applied to such change, and

(B) such change is not so approved.

SEC. 123. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

(a) IN GENERAL- Section 302(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(c)) is amended by adding at the end the following new paragraph:

‘(12) ANTICIPATION OF BENEFIT INCREASES EFFECTIVE IN THE FUTURE- In determining projected benefits, the funding method of a collectively bargained plan described in section 413(a) of the Internal Revenue Code of 1986 (other than a multiemployer plan) shall anticipate benefit increases scheduled to take effect during the term of the collective bargaining agreement applicable to the plan.’

(b) EFFECTIVE DATE- The amendments made by this section shall apply to plan years beginning after December 31, 1994 with respect to collective bargaining agreements in effect on or after January 1, 1995.

SEC. 124. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

(a) IN GENERAL- Paragraph (1) of section 302(e) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(e)) is amended--

(1) by inserting ‘which has a funded current liability percentage (as defined in subsection (d)(8)) for the preceding plan year of less than 100 percent’ before ‘fails’, and

(2) by striking ‘any plan year’ and inserting ‘the plan year’.

(b) EFFECTIVE DATE- The amendment made by this section shall apply to plan years beginning after the date of enactment of this Act.

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

SEC. 201. REPORTABLE EVENTS.

(a) RESPONSIBILITY FOR REPORTABLE EVENTS REPORTING- Section 4043(a) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1343(a)) is amended--

(1) in the first sentence, by inserting ‘or the contributing sponsor’ before ‘knows or has reason to know’;

(2) in the first sentence, by inserting ‘, unless a notice otherwise required under this subsection has already been provided with respect to such event’ before the period at the end; and

(3) by striking the last sentence.

(b) NOTIFICATION THAT EVENT IS ABOUT TO OCCUR- Section 4043 of such Act is amended by redesignating subsections (b), (c), and (d) as (c), (d), and (e), respectively, and by inserting after subsection (a) the following new subsection:

‘(b)(1) The requirements of this subsection shall be applicable to a contributing sponsor only if the aggregate unfunded vested benefits at the close of the preceding plan year (as determined under section 4006(a)(3)(E)(iii)) of plans maintained by such sponsor and the members of such sponsor’s controlled group that are covered by this title (taking into account only those plans with unfunded vested benefits) exceed $50,000,000.

‘(2) No later than 30 days prior to the effective date of an event described in paragraph (9), (10), (11), (12), or (13) of subsection (c), a contributing sponsor to which the requirements of this subsection apply shall notify the corporation that the event is about to occur.

‘(3) The corporation may waive the requirement of this subsection with respect to any or all reportable events with respect to any contributing sponsor.’

(c) NEW REPORTABLE EVENTS- Subsection (c) of section 4043 of such Act (as redesignated by subsection (b)) is amended--

(1) by striking the ‘or’ at the end of paragraph (8);

(2) by striking paragraph (9); and

(3) by inserting after paragraph (8) the following new paragraphs:

‘(9) when, as a result of an event, a person ceases to be a member of the controlled group;

‘(10) when a contributing sponsor or a member of a contributing sponsor’s controlled group liquidates in a case under title 11, United States Code, or under any similar Federal law or law of a State or political subdivision of a State;

‘(11) when a contributing sponsor or a member of a contributing sponsor’s controlled group declares an extraordinary dividend (as defined in section 1059(c) of the Internal Revenue Code of 1986) or redeems, in any 12-month period, an aggregate of 10 percent or more of the total combined voting power of all classes of stock entitled to vote, or an aggregate of 10 percent of more of the total value of shares of all classes of stock, of a contributing sponsor and all members of its controlled group;

‘(12) when, in any 12-month period, an aggregate of 3 percent or more of the benefit liabilities of a plan covered by this title and maintained by a contributing sponsor or a member of its controlled group are transferred to a person that is not a member of the controlled group or to a plan or plans maintained by a person or persons that are not such a contributing sponsor or a member of its controlled group; or

‘(13) when any other event occurs that may be indicative of a need to terminate the plan and that is prescribed by the corporation in regulations.’

(d) DISCLOSURE EXEMPTION- Section 4043 of such Act is amended by adding at the end the following new subsection:

‘(f) Any information or documentary material submitted to the corporation pursuant to subsection (c) or subsection 4050(c)(2) shall be exempt from disclosure under section 552 of title 5, United States Code, and no such information or documentary material may be made public, except as may be relevant to any administrative or judicial action or proceeding. Nothing in this section is intended to prevent disclosure to either body of Congress or to any duly authorized committee or subcommittee of the Congress.’

(e) TECHNICAL AND CONFORMING AMENDMENTS-

(1) Subsection (a) of section 4043 of such Act, and subsections (d) and (e) of such section 4043 (as redesignated by subsection (b)) are amended by striking ‘subsection (b)’ each place it appears and inserting ‘subsection (c)’.

(2) Section 4042(a)(3) of such Act is amended by striking ‘4043(b)(7)’ and inserting ‘4043(c)(7)’.

(f) EFFECTIVE DATE- The amendments made by this section shall be effective for events occurring 60 days or more after the date of enactment of this Act.

SEC. 202. ALTERNATIVE TO INVOLUNTARY TERMINATION.

(a) IN GENERAL- Subtitle C of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341 et seq.) is amended by adding at the end the following new section:

‘SEC. 4050. JUDICIAL RELIEF OTHER THAN INVOLUNTARY TERMINATION.

‘(a) INSTITUTION OF PROCEEDINGS-

‘(1) IN GENERAL- Whenever the corporation determines (without regard to the potential availability of relief under this section) that, upon the occurrence of an event described in paragraph (9), (10), (11), (12), or (13) of section 4043(c), the possible long-run loss of the corporation with respect to a plan may reasonably be expected to increase unreasonably if the plan is not terminated, the corporation may, in its discretion, institute proceedings under this section as an alternative to instituting proceedings under section 4042 to terminate the plan.

‘(2) LIMITATION- In the case of an event described in paragraph (9) or (13) of section 4043(c), this section shall apply only if, immediately after the effective date of the event, the total revenues, the total operating income, or the total assets of a contributing sponsor and all members of its controlled group would be less than 90 percent of the total revenues, the total operating income, or the total assets, respectively, of a contributing sponsor and all members of its controlled group immediately before the effective date of the event. For purposes of this paragraph, all events occurring in any 12-month period shall be treated as a single event.

‘(b) Whenever the corporation makes a determination under subsection (a), it may, upon notice to a contributing sponsor, apply to the appropriate United States district court for such legal or equitable relief as the corporation deems appropriate and consistent with its duties under this title. The court shall consider the interests of both the participants and the corporation, and shall grant such relief, if any, as it determines is necessary to protect those interests without interfering unreasonably with the business of the contributing sponsor or members of its controlled group.

‘(c)(1) In any case in which the corporation is provided with a notice required by subsection 4043(b) within the time specified in that subsection, the corporation may bring an action under this section no later than 30 days after the date such notice is received. Notwithstanding the preceding sentence, the corporation may, no later than 30 days after the date such notice is received, require the submission of additional information or documentary material, in which case an action under this section may be brought no later than 20 days after the corporation receives all the information and documentary material it had required.

‘(2) A person who has provided a notice as described in paragraph (1) may elect, upon further notice to the corporation, to proceed with an event prior to the expiration of the time periods described in paragraph (1). In the case of such an election, an action under this section may be brought at any time within the period specified in subsection 4003(e)(6).

‘(3) In any case in which the corporation is not provided with a notice required by subsection (b) of section 4043 by the time specified in that subsection, in any case in which a person fails or refuses to provide the additional information or documentary material required by the corporation under paragraph (1), or in any case in which a person proceeds with an event without providing the corporation with the further notice required under paragraph (2) with respect to such event, an action under this section may be brought at any time within the time period specified in subsection 4003(e)(6).

‘(4) Except as provided in paragraph (1), (2), or (3), an action under this section may not be brought after the effective date of the event giving rise to the transaction.

‘(5) For purposes of applying subsection 4003(e)(6) to paragraphs (2) and (3), a cause of action shall be deemed to arise on the effective date of the event.

‘(d) Nothing in this section shall limit the authority of the corporation to initiate proceedings to terminate a plan under section 4042, or to initiate proceedings or to seek relief under any other provision of this title or any other law.’

(b) CONFORMING AMENDMENT- Section 4042(a) of such Act (29 U.S.C. 1342(a)) is amended by inserting, after ‘determines’ the first place it appears, the following: ‘(without regard to the potential availability of relief under section 4050)’.

(c) CLERICAL AMENDMENT- The table of contents contained in section 1 of such Act is amended by inserting after the item relating to section 4049 the following new item:

‘Sec. 4050. Judicial relief other than involuntary termination.’

(d) EFFECTIVE DATE- The amendments made by this section shall be effective for events occurring 60 days or more after the date of the enactment of this Act.

SEC. 203. CERTAIN INFORMATION REQUIRED TO BE FURNISHED TO PBGC.

(a) GENERAL RULE- Subtitle A of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1301 et seq.) is amended by adding at the end the following new section:

‘SEC. 4010. AUTHORITY TO REQUIRE CERTAIN INFORMATION.

‘(a) INFORMATION REQUIRED- Each person described in subsection (b) shall provide the corporation annually, on or before a date specified by the corporation in regulations, with--

‘(1) such records, documents, or other information that the corporation specifies in regulations as necessary to determine the liabilities and assets of plans covered by this title; and

‘(2) copies of such person’s audited (or, if unavailable, unaudited) financial statements, and such other financial information as the corporation may prescribe in regulations.

‘(b) PERSONS REQUIRED TO PROVIDE INFORMATION- The persons covered by subsection (a) are each contributing sponsor, and each member of a contributing sponsor’s controlled group, of a single-employer plan covered by this title, if--

‘(1) the aggregate unfunded vested benefits at the end of the preceding plan year (as determined under section 4006(a)(3)(E)(iii)) of plans maintained by the contributing sponsor and the members of its controlled group exceed $50,000,000 (taking into account only those plans of the contributing sponsor and its controlled group with unfunded vested benefits);

‘(2) the conditions for imposition of a lien described in section 302(f)(1)(A) and (B) of this Act or section 412(n)(1)(A) and (B) of the Internal Revenue Code of 1986 have been met with respect to any plan maintained by the contributing sponsor or any member of its controlled group; or

‘(3) minimum funding waivers in excess of $1,000,000 have been granted with respect to any plan maintained by the contributing sponsor or any member of its controlled group, and any portion thereof is still outstanding.

‘(c) INFORMATION EXEMPT FROM DISCLOSURE REQUIREMENTS- Any information or documentary material submitted to the corporation pursuant to this section shall be exempt from disclosure under section 552 of title 5, United States Code, and no such information or documentary material may be made public, except as may be relevant to any administrative or judicial action or proceeding. Nothing in this section is intended to prevent disclosure to either body of Congress or to any duly authorized committee or subcommittee of the Congress.’

(b) CLERICAL AMENDMENT- The table of contents contained in section 1 of such Act is amended by inserting after the item relating to section 4009 the following new item:

‘Sec. 4010. Authority to require certain information.’

(c) EFFECTIVE DATE- The amendments made by this section shall be effective on the date of enactment of this Act.

SEC. 204. LIABILITY UPON LIQUIDATION OF CONTRIBUTING SPONSOR OR CONTROLLED GROUP MEMBER WHERE PLAN REMAINS ONGOING.

(a) IN GENERAL- Section 4062 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1362) is amended by adding at the end the following new subsection:

‘(f) LIABILITY ON LIQUIDATION OF CONTRIBUTING SPONSOR OR CONTROLLED GROUP MEMBER-

‘(1) IN GENERAL- In any case in which all or substantially all of the assets of a person who is a contributing sponsor of a single-employer plan, or a member of a controlled group of a contributing sponsor of a single-employer plan, are liquidated in a case under title 11, United States Code, or under any similar Federal law or law of a State or political subdivision of a State, but the plan is not terminated, such person shall be deemed liable under subsection (b) as if the plan had terminated under section 4041(c) in the course of such liquidation and as if the termination date were the date determined by the corporation as the date on which the liquidation was initiated.

‘(2) LIMITED JOINT AND SEVERAL LIABILITY- The liability under this subsection shall be joint and several only among the members of the controlled group (including, where applicable, the contributing sponsor) who are liquidating as described in paragraph (1).

‘(3) APPLICABILITY OF OTHER PROVISIONS- Except as provided in paragraph (2), any provision of this Act or any other provision of law that applies to liability under the preceding subsections of this section upon termination of a plan shall apply in the same manner and to the same extent to the liability established under this subsection. For purposes of this paragraph, the date referred to in paragraph (1) shall be deemed the termination date.

‘(4) LIABILITY OWED TO PLAN; TRANSFER OF LIABILITY PAYMENTS TO THE ONGOING PLAN WHERE COLLECTED BY THE CORPORATION- The liability established under this subsection shall be owed to the plan, and may be collected by either the plan or the corporation. The corporation shall pay to the plan any amounts collected by the corporation in satisfaction of the liability established under this subsection in connection with such plan.

‘(5) REGULATIONS- The corporation may prescribe regulations under this subsection, including--

‘(A) rules governing--

‘(i) the determination of whether and when a liquidation referred to in this subsection has occurred, and

‘(ii) the assignment of the plan’s or corporation’s claim to liability payments under this subsection to other members of the controlled group as a means of collecting such payments, subject to the transfer of such payments to the plan, and

‘(B) rules providing alternative arrangements for making liability payments under this subsection.’

(b) CONFORMING AMENDMENT- Section 4062(a) of such Act is amended--

(1) in paragraph (1), by striking ‘and’ after ‘subsection (b),’;

(2) in paragraph (2), by striking the period after ‘subsection (c)’ and inserting ’, and’; and

(3) by adding at the end the following new paragraph:

‘(3) liability to the plan, to the extent provided in subsection (f).’

(c) COORDINATION WITH MINIMUM FUNDING RULES-

(1) 1986 CODE- Section 412(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

‘(13) TREATMENT OF LIABILITY ON LIQUIDATION OF EMPLOYER- Any amount paid to a plan pursuant to section 4062(f) of the Employee Retirement Income Security Act of 1974--

‘(A) shall be treated as not contributed by the employer for purposes of subsection (b)(3)(A), and

‘(B) shall be treated as a net experience gain of the plan under subsection (b)(3)(B)(ii).’

(2) ERISA- Section 302(c) of the Employee Retirement Income Security Act of 1974 is amended by adding at the end the following new paragraph:

‘(13) TREATMENT OF LIABILITY ON LIQUIDATION OF EMPLOYER- Any amount paid to a plan pursuant to section 4062(f)--

‘(A) shall be treated as not contributed by the employer for purposes of subsection (b)(3)(A), and

‘(B) shall be treated as a net experience gain of the plan under subsection (b)(3)(B)(ii).’

(d) EFFECTIVE DATE- The amendments made by this section shall be effective for liquidations initiated on or after the date of enactment of this Act.

SEC. 205. ENFORCEMENT OF MINIMUM FUNDING REQUIREMENTS.

(a) IN GENERAL- Paragraph (1) of section 4003(e) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1303(e)(1)) is amended--

(1) by inserting ‘(A)’ after ‘enforce’; and

(2) by striking the period after ‘title’ and inserting ‘, and (B) in the case of a plan which is covered under this title (other than a multiemployer plan) and for which the conditions for imposition of a lien described in section 302(f)(1)(A) and (B) of this Act or section 412(n)(1)(A) and (B) of the Internal Revenue Code of 1986 have been met, section 302 of this Act and section 412 of such Code.’

(b) EFFECTIVE DATE- The amendments made by this section shall be effective for installments and other payments required under section 302 of the Employee Retirement Income Security Act of 1974 or section 412 of the Internal Revenue Code of 1986 that become due on or after the date of the enactment of this Act.

SEC. 206. REMEDIES FOR NONCOMPLIANCE WITH REQUIREMENTS FOR STANDARD TERMINATION.

(a) NOTICE OF NONCOMPLIANCE- Section 4041(b)(2)(C)(i) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341(b)(2)(C)(i)) is amended--

(1) by striking subclause (I) and inserting the following new subclause:

‘(I) it determines, based on the notice sent under paragraph (2)(A) of subsection (b), that there is reason to believe that the plan is not sufficient for benefit liabilities, or’;

(2) by striking the period at the end of subclause (II) and inserting ‘, or’; and

(3) by adding at the end the following new subclause:

‘(III) it determines that any other requirement of subparagraph (A) or (B) of this paragraph or of subsection (a)(2) has not been met, unless it further determines that the issuance of such notice would be inconsistent with the interests of participants and beneficiaries.’

(b) EFFECTIVE DATE- The amendments made by this section shall apply to any plan termination under section 4041(b) of the Employee Retirement Income Security Act of 1974 with respect to which the Pension Benefit Guaranty Corporation has not, as of the date of enactment of this Act, issued a notice of noncompliance that has become final, or otherwise issued a final determination that the plan termination is nullified.

SEC. 207. PROHIBITION ON BENEFIT INCREASES WHERE PLAN SPONSOR IS IN BANKRUPTCY.

(a) AMENDMENT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974- Section 204 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1054), as amended by section 121 of this Act, is further amended by redesignating subsection (j) as (k) and inserting a new subsection (j) to read as follows:

‘(j)(1) In the case of a plan described in paragraph (3) which is maintained by an employer that is a debtor in a case under title 11, United States Code, or similar Federal or State law, no amendment of the plan which increases the liabilities of the plan by reason of--

‘(A) any increase in benefits,

‘(B) any change in the accrual of benefits, or

‘(C) any change in the rate at which benefits become nonforfeitable under the plan,

with respect to employees of the debtor, shall be effective prior to the effective date of such employer’s plan of reorganization.

‘(2) Paragraph (1) shall not apply to any plan amendment that--

‘(A) the Secretary of the Treasury determines to be reasonable and that provides for only de minimis increases in the liabilities of the plan with respect to employees of the debtor,

‘(B) only repeals an amendment described in section 302(c)(8),

‘(C) is required as a condition of qualification under part I of subchapter D, of chapter 1, of the Internal Revenue Code of 1986, or

‘(D) was adopted prior to, or pursuant to a collective bargaining agreement entered into prior to, the date on which the employer became a debtor in a case under title 11, United States Code, or similar Federal or State law.

‘(3) This subsection shall apply only to plans (other than multiemployer plans) covered under section 4021 of this Act for which the funded current liability percentage (within the meaning of section 302(d)(8) of this Act) is less than 100 percent after taking into account the effect of the amendment.

‘(4) For purposes of this subsection, ‘employer’ has the meaning set forth in section 302(c)(11)(A), without regard to section 302(c)(11)(B).’

(b) AMENDMENT TO INTERNAL REVENUE CODE OF 1986- Section 401(a) of the Internal Revenue Code of 1986, as amended by section 101 of this Act, is further amended by adding at the end the following new paragraph:

‘(33) PROHIBITION ON BENEFIT INCREASES WHILE SPONSOR IS IN BANKRUPTCY-

‘(A) IN GENERAL- A trust which is part of a plan to which this paragraph applies shall not constitute a qualified trust under this section if an amendment to such plan is adopted while the employer is a debtor in a case under title 11, United States Code, or similar Federal or State law, if such amendment increases liabilities of the plan by reason of--

‘(i) any increase in benefits,

‘(ii) any change in the accrual of benefits, or

‘(iii) any change in the rate at which benefits become nonforfeitable under the plan,

with respect to employees of the debtor, and such amendment is effective prior to the effective date of such employer’s plan of reorganization.

‘(B) EXCEPTIONS- This paragraph shall not apply to any plan amendment if--

‘(i) the plan, were such amendment to take effect, would have a funded current liability percentage (as defined in section 412(l)(8)) of 100 percent or more,

‘(ii) the Secretary determines that such amendment is reasonable and provides for only de minimis increases in the liabilities of the plan with respect to employees of the debtor,

‘(iii) such amendment only repeals an amendment described in subsection 412(c)(8), or

‘(iv) such amendment is required as a condition of qualification under this part.

‘(C) PLANS TO WHICH THIS PARAGRAPH APPLIES- This paragraph shall apply only to plans (other than multiemployer plans) covered under section 4021 of the Employee Retirement Income Security Act of 1974.

‘(D) EMPLOYER- For purposes of this paragraph, the term ‘employer’ means the employer referred to in section 412(c)(11) (without regard to subparagraph (B) thereof).’

(c) EFFECTIVE DATE- The amendments made by this section shall apply to plan amendments adopted on or after the date of enactment of this Act.

SEC. 208. SUBSTANTIAL OWNER BENEFITS.

(a) MODIFICATION OF PHASE-IN OF GUARANTEE- Section 4022(b)(5) of the Employee Retirement Income Security Act of 1974 is amended by striking subparagraphs (B) and (C) and inserting the following new subparagraphs:

‘(B) For purposes of this title, the term ‘majority owner’ has the same meaning as the term ‘substantial owner’, if ‘50 percent or more’ is substituted for ‘more than 10 percent’ wherever such phrase appears in subparagraph (A) of this paragraph.

‘(C) In the case of a participant who is a majority owner, the amount of benefits guaranteed under this section shall not exceed the product of--

‘(i) a fraction (not to exceed 1) the numerator of which is the number of years from the later of the effective date or the adoption date of the plan, and the denominator of which is 30, and

‘(ii) the amount of the majority owner’s monthly benefits guaranteed under subsection (a) (as limited by paragraph (3) of this subsection).’

(b) MODIFICATION OF ALLOCATION OF ASSETS-

(1) Section 4044(a)(4)(B) of such Act (29 U.S.C. 1344(a)(4)(B)) is amended by adding ‘(C)’ at the end of ‘section 4022(b)(5)’.

(2) Section 4044(b) of such Act is amended--

(A) in paragraph (2), by inserting ‘(4),’ before ‘(5)’, and by inserting a comma after ‘(5)’;

(B) by redesignating paragraphs (3) through (6) as paragraphs (4) through (7), respectively; and

(C) by inserting a new paragraph (3) to read as follows:

‘(3) If assets available for allocation under paragraph (4) of subsection (a) are insufficient to satisfy in full the benefits of all individuals who are described in that paragraph, the assets shall be allocated first to benefits described in subparagraph (A) of that paragraph. Any remaining assets shall then be allocated to subparagraph (B). If assets allocated to subparagraph (B) are insufficient to satisfy in full the benefits in that subparagraph, the assets shall be allocated pro rata among individuals on the basis of the present value (as of the termination date) of their respective benefits described in that subparagraph.’.

(c) EFFECTIVE DATE- The amendments made by this section shall be effective for plan terminations under section 4041(c) of the Employee Retirement Income Security Act of 1974 with respect to which notices of intent to terminate are provided under section 4041(a)(2) of such Act, or under section 4042 of such Act with respect to which proceedings are instituted by the corporation, on or after the date of enactment of this Act.

SEC. 209. PHASE-OUT OF VARIABLE RATE PREMIUM CAP.

(a) IN GENERAL- Subparagraph (E) of section 4006(a)(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1306(a)(3)(E)) is amended by striking clause (iv), and by redesignating clause (v) as clause (iv).

(b) EFFECTIVE DATE- The amendments made by this section shall be effective on the date of enactment of this Act, except that, for plan years beginning on or after July 1, 1994 and before July 1, 1996, the additional premium payable with respect to any participant by reason of this amendment shall not exceed the sum of--

(1) $53, and

(2) the product derived by multiplying--

(A) the excess (if any) of--

(i) the amount determined under clause (ii) of section 4006(a)(3)(E) of the Employee Retirement Income Security Act of 1974, over

(ii) $53, by

(B) the applicable percentage.

For purposes of this subsection, the applicable percentage shall be the percentage specified in the following table:

------------------------------------------------------------------------
For the plan year beginning:              The applicable percentage is: 
                 on or after but before                                 
------------------------------------------------------------------------
       July 1, 1994 July 1, 1995 20 percent                    
       July 1, 1995 July 1, 1996 60 percent                    
------------------------------------------------------------------------

TITLE III--PARTICIPANT SERVICES

SEC. 301. DISCLOSURE TO PARTICIPANTS.

(a) PARTICIPANT NOTICE REQUIREMENT- Subtitle A of title IV of the Employee Retirement Income Security Act of 1974 (as amended by section 203 of this Act) is further amended by adding at the end the following new section:

‘SEC. 4011. NOTICE TO PARTICIPANTS.

‘(a) IN GENERAL- The plan administrator of a plan subject to the additional premium under section 4006(a)(3)(E) shall provide, in a form and manner and at such time as prescribed in regulations of the corporation, notice to plan participants and beneficiaries of the plan’s funding status and the limits on the corporation’s guaranty should the plan terminate while underfunded. Such notice shall be written in a manner so as to be understood by the average plan participant.

‘(b) EXCEPTION- Subsection (a) shall not apply to any plan which for the plan year has a funded current liability percentage (as defined in section 302(d)(8) without regard to subparagraph (E) thereof) of at least 90 percent.’

(b) CLERICAL AMENDMENT- The table of contents contained in section 1 of such Act is amended by inserting after the item relating to section 4010 (as added by section 203 of this Act) the following new item:

‘Sec. 4011. Notice to participants.’

(c) EFFECTIVE DATE- The amendment made by this section shall be effective for plan years beginning after the date of enactment of this Act.

SEC. 302. MISSING PARTICIPANTS.

(a) IN GENERAL- Subtitle C of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341 et seq.) is amended by adding at the end the following new section:

‘SEC. 4051. MISSING PARTICIPANTS.

‘(a) GENERAL RULE-

‘(1) PAYMENT TO THE CORPORATION- A plan administrator satisfies section 4041(b)(3)(A) in the case of a missing participant only if the plan administrator--

‘(A) transfers the participant’s designated benefit to the corporation or purchases an irrevocable commitment from an insurer in accordance with clause (i) of section 4041(b)(3)(A), and

‘(B) provides the corporation such information and certifications with respect to such designated benefits or irrevocable commitments as the corporation shall specify.

‘(2) TREATMENT OF TRANSFERRED ASSETS- A transfer to the corporation under this section shall be treated as a transfer of assets from a terminated plan to the corporation as trustee, and shall be held with assets of terminated plans for which the corporation is trustee under section 4042, subject to the rules set forth in that section.

‘(3) PAYMENT BY THE CORPORATION- After a missing participant whose designated benefit was transferred to the corporation is located--

‘(A) in any case in which the plan could have distributed the benefit of the missing participant in a single sum without participant or spousal consent under section 205(g), the corporation shall pay the participant or beneficiary a single sum benefit equal to the designated benefit paid the corporation plus interest as specified by the corporation, and

‘(B) in any other case, the corporation shall pay a benefit based on the designated benefit and the assumptions prescribed by the corporation at the time that the corporation received the designated benefit.

The corporation shall make payments under subparagraph (B) available in the same forms and at the same times as a guaranteed benefit under section 4022 would be available to be paid, except that the corporation may make a benefit available in the form of a single sum if the plan provided a single sum benefit (other than a single sum described in subsection (b)(2)(A)).

‘(b) DEFINITIONS- For purposes of this section--

‘(1) MISSING PARTICIPANT- The term ‘missing participant’ means a participant or beneficiary under a terminating plan whom the plan administrator cannot locate after a diligent search.

‘(2) DESIGNATED BENEFIT- The term ‘designated benefit’ means the single sum benefit the participant would receive--

‘(A) under the plan’s assumptions, in the case of a distribution that can be made without participant or spousal consent under section 205(g);

‘(B) under the assumptions of the corporation in effect on the date that the designated benefit is transferred to the corporation, in the case of a plan that does not pay any single sums other than those described in subparagraph (A); or

‘(C) under the assumptions of the corporation or of the plan, whichever provides the higher single sum, in the case of a plan that pays a single sum other than those described in subparagraph (A).

‘(c) REGULATORY AUTHORITY- The corporation shall prescribe such regulations as are necessary to carry out the purposes of this section, including rules relating to what will be considered a diligent search, the amount payable to the corporation, and the amount to be paid by the corporation.’

(b) CONFORMING TITLE IV AMENDMENTS-

(1) AMENDMENT TO SECTION 4003- Section 4003(a) of such Act (29 U.S.C. 1303(a)) is amended in the second sentence by inserting before the period the following: ‘and whether section 4051(a) has been satisfied’.

(2) AMENDMENT TO SECTION 4005- Section 4005(b)(2)(A) of such Act (29 U.S.C. 1305(b)(2)(A)) is amended by inserting ‘or benefits payable under section 4051’ after ‘section 4022A’.

(3) AMENDMENT TO SECTION 4041- Section 4041(b)(3)(A)(ii) of such Act (29 U.S.C. 1341(b)(3)(A)(ii)) is amended by adding at the end the following new sentence: ‘A transfer of assets to the corporation in accordance with section 4051 on behalf of a missing participant shall satisfy this subparagraph with respect to such participant.’

(c) CONFORMING ERISA AMENDMENTS-

(1) The table of contents contained in section 1 of the Employee Retirement Income Security Act of 1974 is amended by inserting after the item related to section 4050 (as added by section 202 of this Act) the following new item:

‘Sec. 4051. Missing participants.’

(2) Section 206 of such Act (29 U.S.C. 1056) is amended by adding at the end the following new subsection:

‘(e) MISSING PARTICIPANTS IN TERMINATED PLANS- In the case of a plan covered by title IV, the plan shall provide that, upon termination of the plan, benefits of missing participants shall be treated in accordance with section 4051.’

(d) CONFORMING INTERNAL REVENUE CODE AMENDMENTS- Section 401(a) of the Internal Revenue Code of 1986, as amended by section 207 of this Act, is further amended by inserting after paragraph (33) the following new paragraph:

‘(34) BENEFITS OF MISSING PARTICIPANTS ON PLAN TERMINATION- In the case of a plan covered by title IV of the Employee Retirement Income Security Act of 1974, a trust forming part of such plan shall not be treated as failing to constitute a qualified trust under this section merely because the pension plan of which such trust is a part, upon its termination, transfers benefits of missing participants to the Pension Benefit Guaranty Corporation in accordance with section 4051 of such Act.’

(e) EFFECTIVE DATE- The provisions of this section shall be effective with respect to distributions that occur in plan years commencing after final regulations implementing these provisions are prescribed by the Pension Benefit Guaranty Corporation.

SEC. 303. MODIFICATION OF MAXIMUM GUARANTEE FOR DISABILITY BENEFITS.

(a) IN GENERAL- Section 4022(b)(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1322(b)(3)) is amended by adding at the end the following new sentences: ‘The maximum guaranteed monthly benefit shall not be reduced solely on account of the age of a participant in the case of a benefit payable by reason of disability, if the participant satisfies the definition of disability under titles II and XVI of the Social Security Act, and the regulations thereunder. If a benefit payable by reason of disability is converted to an early or normal retirement benefit for reasons other than a change in the health of the participant, such early or normal retirement benefit shall be treated as a continuation of the benefit payable by reason of disability and this subparagraph shall continue to apply.’

(b) EFFECTIVE DATE- The amendment made by this section shall be effective for plan terminations under section 4041(c) of the Employee Retirement Income Security Act of 1974 with respect to which notices of intent to terminate are provided under section 4041(a)(2) of such Act, or under section 4042 of such Act with respect to which proceedings are instituted by the corporation, on or after the date of enactment of this Act.

TITLE IV--MISCELLANEOUS AMENDMENTS

SEC. 401. ERISA CITATION.

(a) IN GENERAL- Section 404(g)(4) of the Internal Revenue Code of 1986 is amended by striking ‘the Single Employer Pension Plan Amendments Act of 1986’ and inserting ‘the Retirement Protection Act of 1994’.

(b) EFFECTIVE DATE- The amendment made by this section shall be effective on the date of enactment of this Act.

SEC. 402. DEFINITION OF CONTRIBUTING SPONSOR.

(a) IN GENERAL- Paragraph (13) of section 4001(a) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1301(a)(13)) is amended by striking ‘means a person--’ and all that follows and inserting ‘means a person described in section 302(c)(11)(A) of this Act (without regard to section 302(c)(11)(B) of this Act) or section 412(c)(11)(A) of the Internal Revenue Code of 1986 (without regard to section 412(c)(11)(B) of such Code).’

(b) EFFECTIVE DATE- The amendment made by this section shall be effective as if included in the Pension Protection Act.

SEC. 403. DISTRESS TERMINATION CRITERIA FOR BANKING INSTITUTIONS.

(a) CLARIFICATION OF DISTRESS CRITERION- Subclause (I) of section 4041(c)(2)(B)(i) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341(c)(2)(B)(i)) is amended by inserting after ‘under any similar’ the following: ‘Federal law or’.

(b) EFFECTIVE DATE- The amendment made by this section shall be effective as if included in the Single-Employer Pension Plan Amendments Act of 1986.

SEC. 404. SINGLE SUM DISTRIBUTIONS.

(a) AMENDMENTS TO INTERNAL REVENUE CODE OF 1986 RELATING TO MINIMUM BENEFITS-

(1) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON MANDATORY DISTRIBUTIONS- Subparagraph (B) of section 411(a)(11) of the Internal Revenue Code of 1986 is amended to read as follows:

‘(B) DETERMINATION OF PRESENT VALUE- For purposes of subparagraph (A), the present value shall be calculated in accordance with section 417(e)(3).’

(2) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON CASH-OUTS- Paragraph (3) of section 417(e) of such Code is amended to read as follows:

‘(3) DETERMINATION OF PRESENT VALUE-

‘(A) IN GENERAL-

‘(i) PRESENT VALUE- Except as provided in subparagraph (B), for purposes of paragraphs (1) and (2), the present value shall not be less than the present value calculated by using the applicable mortality table and the applicable interest rate.

‘(ii) DEFINITIONS- For purposes of clause (i)--

‘(I) APPLICABLE MORTALITY TABLE- The term ‘applicable mortality table’ means the table prescribed by the Secretary. Such table shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A)) used to determine reserves for group annuity contracts issued on the date as of which present value is being determined (without regard to any other subparagraph of section 807(d)(5)).

‘(II) APPLICABLE INTEREST RATE- The term ‘applicable interest rate’ means the annual rate of interest on 30-year Treasury securities for the month before the date of distribution or such other time as the Secretary may by regulations prescribe.

‘(B) EXCEPTION- In the case of a distribution from a plan that was adopted and in effect before the date of the enactment of the Retirement Protection Act of 1994, the present value of any distribution made before the earlier of--

‘(i) the later of the date a plan amendment applying subparagraph (A) is adopted or made effective, or

‘(ii) the first day of the first plan year beginning after December 31, 1999,

shall be calculated, for purposes of paragraphs (1) and (2), using the interest rate determined under the regulations of the Pension Benefit Guaranty Corporation for determining the present value of a lump sum distribution on plan termination that were in effect on September 1, 1993, and using the provisions of the plan as in effect on the day before such date of enactment; but only if such provisions of the plan met the requirements of section 417(e)(3) as in effect on the day before such date of enactment.’

(b) AMENDMENTS TO INTERNAL REVENUE CODE OF 1986 RELATING TO MAXIMUM BENEFITS- Subparagraph (E) of section 415(b)(2) of such Code is amended--

(1) by redesignating clauses (ii) and (iii) as clauses (iii) and (iv), respectively,

(2) by striking clause (i) and inserting the following new clauses:

‘(i) Except as provided in clause (ii), for purposes of adjusting any benefit or limitation under subparagraph (B) or (C), the interest rate assumption shall not be less than the greater of 5 percent or the rate specified in the plan.

‘(ii) For purposes of adjusting the benefit or limitation of any form of benefit subject to section 417(e)(3), the applicable interest rate (as defined in section 417(e)(3)) shall be substituted for ‘5 percent’ in clause (i).’, and

(3) by adding at the end the following new clause:

‘(v) For purposes of adjusting any benefit or limitation under subparagraph (B), (C), or (D), the mortality table used shall be the table prescribed by the Secretary. Such table shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A)) used to determine reserves for group annuity contracts issued on the date the adjustment is being made (without regard to any other subparagraph of section 807(d)(5)).’

(c) AMENDMENTS TO EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974-

(1) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON MANDATORY DISTRIBUTIONS- Section 203(e)(2) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1053(e)(2)) is amended to read as follows:

‘(2) For purposes of paragraph (1), the present value shall be calculated in accordance with section 205(g)(3).’

(2) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON CASH-OUTS- Section 205(g)(3) of such Act (29 U.S.C. 1055(g)(3)) is amended to read as follows:

‘(3) Determination of present value-

‘(A) In general-

‘(i) PRESENT VALUE- Except as provided in subparagraph (B), for purposes of paragraphs (1) and (2), the present value shall not be less than the present value calculated by using the applicable mortality table and the applicable interest rate.

‘(ii) DEFINITIONS- For purposes of clause (i)--

‘(I) APPLICABLE MORTALITY TABLE- The term ‘applicable mortality table’ means the table prescribed by the Secretary of the Treasury. Such table shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A) of the Internal Revenue Code of 1986) used to determine reserves for group annuity contracts issued on the date as of which present value is being determined (without regard to any other subparagraph of section 807(d)(5) of such Code).

‘(II) APPLICABLE INTEREST RATE- The term ‘applicable interest rate’ means the annual rate of interest on 30-year Treasury securities for the month before the date of distribution or such other time as the Secretary of the Treasury may by regulations prescribe.

‘(B) EXCEPTION- In the case of a distribution from a plan that was adopted and in effect prior to the date of the enactment of the Retirement Protection Act of 1994, the present value of any distribution made before the earlier of--

‘(i) the later of when a plan amendment applying subparagraph (A) is adopted or made effective, or

‘(ii) the first day of the first plan year beginning after December 31, 1999,

shall be calculated, for purposes of paragraphs (1) and (2), using the interest rate determined under the regulations of the Pension Benefit Guaranty Corporation for determining the present value of a lump sum distribution on plan termination that were in effect on September 1, 1993, and using the provisions of the plan as in effect on the day before such date of enactment; but only if such provisions of the plan met the requirements of section 205(g)(3) as in effect on the day before such date of enactment.’

(d) Effective Date-

(1) IN GENERAL- The amendments made by this section shall apply to plan years and limitation years beginning after December 31, 1994; except that an employer may elect to treat the amendments made by this section as being effective on or after the date of enactment.

(2) NO REDUCTION IN ACCRUED BENEFITS- A participant’s accrued benefit shall not be considered to be reduced in violation of section 411(d)(6) of the Internal Revenue Code of 1986 or section 204(g) of the Employee Retirement Income Security Act of 1974 merely because (A) the benefit is determined in accordance with section 417(e)(3)(A) of such Code, as amended by this Act, or section 205(g)(3) of the Employee Retirement Income Security Act of 1974, as amended by this Act, or (B) the plan applies section 415(b)(2)(E) of such Code, as amended by this Act.

(3) Section 415-

(A) NO REDUCTION REQUIRED- An accrued benefit shall not be required to be reduced below the accrued benefit as of the last day of the last plan year beginning before January 1, 1995, merely because of the amendments made by subsection (b).

(B) TIMING OF PLAN AMENDMENT- A plan that operates in accordance with the amendments made by subsection (b) shall not be treated as failing to satisfy section 401(a) of the Internal Revenue Code of 1986 or as not being operated in accordance with the provisions of the plan until such date as the Secretary of the Treasury provides merely because the plan has not been amended to include the amendments made by subsection (b).

SEC. 405. ADJUSTMENTS TO LIEN FOR MISSED MINIMUM FUNDING CONTRIBUTIONS.

(a) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986-

(1) CLARIFICATION OF APPLICABILITY OF PROVISION- Paragraph (2) of section 412(n) of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: ‘This subsection shall not apply to any plan to which section 4021 of the Employee Retirement Income Security Act of 1974 does not apply (as such section is in effect on the date of the enactment of the Retirement Protection Act of 1994).’.

(2) REPEAL OF $1,000,000 OFFSET- Paragraph (3) of section 412(n) of such Code is amended to read as follows:

‘(3) AMOUNT OF LIEN- For purposes of paragraph (1), the amount of the lien shall be equal to the aggregate unpaid balance of required installments and other payments required under this section (including interest)--

‘(A) for plan years beginning after 1987, and

‘(B) for which payment has not been made before the due date.’

(3) REPEAL OF 60-DAY DELAY- Section 412(n)(4)(B) of such Code is amended by striking ‘60th day following the’.

(b) AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974-

(1) CLARIFICATION OF APPLICABILITY OF PROVISION- Section 302(f)(1) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(f)(1)) is amended by striking ‘to which this section applies’ and inserting ‘covered under section 4021 of this Act’.

(2) REPEAL OF $1,000,000 OFFSET- Paragraph (3) of section 302(f) of such Act is amended to read as follows:

‘(3) AMOUNT OF LIEN- For purposes of paragraph (1), the amount of the lien shall be equal to the aggregate unpaid balance of required installments and other payments required under this section (including interest)--

‘(A) for plan years beginning after 1987, and

‘(B) for which payment has not been made before the due date.’

(3) REPEAL OF 60-DAY DELAY- Section 302(f)(4)(B) of such Act is amended by striking ‘60th day following the’.

(c) EFFECTIVE DATE- The amendments made by this section shall be effective for installments and other payments required under section 412 of the Internal Revenue Code of 1986 or under part 3 of subtitle B of the Employee Retirement Income Security Act of 1974 that become due on or after the date of enactment.

SEC. 406. ROUNDING RULES FOR COST-OF-LIVING ADJUSTMENTS.

(a) COST-OF-LIVING ADJUSTMENT FOR COMPENSATION LIMIT- Section 401(a)(17)(B) of the Internal Revenue Code of 1986 is revised to read as follows:

‘(B) COST-OF-LIVING ADJUSTMENT- The Secretary shall adjust annually the $150,000 amount in subparagraph (A) for increases in the cost-of-living at the same time and in the same manner as adjustments under section 415(d); except that the base period shall be the calendar quarter beginning October 1, 1993, and any increase which is not a multiple of $10,000 shall be rounded to the next lowest multiple of $10,000.’

(b) COST-OF-LIVING ADJUSTMENT FOR MAXIMUM DEFINED BENEFIT AMOUNT AND MAXIMUM ANNUAL ADDITION-

(1) IN GENERAL- Section 415(d) of such Code is amended to read as follows:

‘(d) Cost-of-Living Adjustments-

‘(1) IN GENERAL- The Secretary shall adjust annually--

‘(A) the $90,000 amount in subsection (b)(1)(A),

‘(B) in the case of a participant who separated from service, the amount taken into account under subsection (b)(1)(B), and

‘(C) the $30,000 amount in subsection (c)(1)(A),

for increases in the cost-of-living in accordance with regulations prescribed by the Secretary.

‘(2) METHOD- The regulations prescribed under paragraph (1) shall provide for--

‘(A) an adjustment with respect to any calendar year based on the increase in the applicable index for the calendar quarter ending September 30 of the preceding calendar year over such index for the base period, and

‘(B) adjustment procedures which are similar to the procedures used to adjust benefit amounts under section 215(i)(2)(A) of the Social Security Act.

‘(3) BASE PERIOD- For purposes of paragraph (2)--

‘(A) $90,000 AMOUNT- The base period taken into account for purposes of paragraph (1)(A) is the calendar quarter beginning October 1, 1986.

‘(B) SEPARATIONS AFTER DECEMBER 31, 1994- The base period taken into account for purposes of paragraph (1)(B) with respect to individuals separating from service with the employer after December 31, 1994, is the calendar quarter beginning July 1 of the calendar year preceding the calendar year in which such separation occurs.

‘(C) SEPARATIONS BEFORE JANUARY 1, 1995- The base period taken into account for purposes of paragraph (1)(B) with respect to individuals separating from service with the employer before January 1, 1995, is the calendar quarter beginning October 1 of the calendar year preceding the calendar year in which such separation occurs.

‘(D) $30,000 AMOUNT- The base period taken into account for purposes of paragraph (1)(C) is the calendar quarter beginning October 1, 1993.’

‘(4) ROUNDING- Any increase under subparagraph (A) or (C) of paragraph (1) which is not a multiple of $5,000 shall be rounded to the next lowest multiple of $5,000.’

(2) CONFORMING AMENDMENT- Section 415(c)(1)(A) of such Code is amended by striking ‘(or, if greater, 1/4 of the dollar limitation in effect under subsection (b)(1)(A))’.

(c) COST-OF-LIVING ADJUSTMENT FOR MAXIMUM SALARY DEFERRAL- Section 402(g)(5) of such Code is amended by inserting before the period ‘; except that any increase under this paragraph which is not a multiple of $500 shall be rounded to the next lowest multiple of $500’.

(d) COST-OF-LIVING ADJUSTMENT FOR ELIGIBILITY FOR SIMPLIFIED EMPLOYEE PENSIONS- Section 408(k)(8) of such Code is amended by inserting before the period ‘; except that any increase in the $300 amount which is not a multiple of $50 shall be rounded to the next lowest multiple of $50’.

(e) EFFECTIVE DATE- The amendments made by this section shall apply to years beginning after December 31, 1994.

SEC. 407. FUNDING OF RESTORED PLANS.

Any changes made by this Act to section 412 of the Internal Revenue Code of 1986 or to part 3 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 shall not apply to a plan which is, on the date of enactment of this Act, subject to a restoration payment schedule order issued by the Pension Benefit Guaranty Corporation that meets the requirements of section 1.412(c)(1)-3 of the Treasury Regulations.

SEC. 408. STUDY OF FUNDING STATUS OF FEDERAL, STATE, AND LOCAL GOVERNMENT PENSION PLANS.

(a) IN GENERAL- The Comptroller General shall conduct a study of the underfunding of Federal, State, and local government pension plans. Such study shall address the causes and implications of such underfunding, as well as the feasibility of requiring such plans to comply with funding, reporting, and disclosure requirements imposed by Federal law on private pension plans.

(b) REPORT- The report of such study shall be submitted not later than April 1, 1995, to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate.

TITLE V--EFFECTIVE DATES

SEC. 501. EFFECTIVE DATES.

Except as otherwise provided in this Act, the amendments made by this Act shall be effective on the date of enactment of this Act.

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) SHORT TITLE- This Act may be cited as the ‘Retirement Protection Act of 1994’.

(b) TABLE OF CONTENTS-

Sec. 1. Short title and table of contents.

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Employee Retirement Income Security Act of 1974

Sec. 101. Minimum funding requirements.

Sec. 102. Limitation on changes in current liability assumptions.

Sec. 103. Anticipation of bargained benefit increases.

Sec. 104. Modification of quarterly contribution requirement.

Subtitle B--Amendments to the Internal Revenue Code of 1986

Sec. 121. Minimum funding requirements.

Sec. 122. Limitation on changes in current liability assumptions.

Sec. 123. Anticipation of bargained benefit increases.

Sec. 124. Modification of quarterly contribution requirement.

Sec. 125. Exceptions to excise tax on nondeductible contributions.

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

Sec. 201. Reportable events.

Sec. 202. Alternative to involuntary termination.

Sec. 203. Certain information required to be furnished to pbgc.

Sec. 204. Liability upon liquidation of contributing sponsor or controlled group member if plan remains ongoing.

Sec. 205. Enforcement of minimum funding requirements.

Sec. 206. Remedies for noncompliance with requirements for standard termination.

Sec. 207. Prohibition on benefit increases where plan sponsor is in bankruptcy.

Sec. 208. Substantial owner benefits.

Sec. 209. Phase-out of variable rate premium cap.

TITLE III--PARTICIPANT SERVICES

Sec. 301. Disclosure to participants.

Sec. 302. Missing participants.

Sec. 303. Modification of maximum guarantee for disability benefits.

TITLE IV--MISCELLANEOUS AMENDMENTS

Sec. 401. ERISA citation.

Sec. 402. Definition of contributing sponsor.

Sec. 403. Technical corrections.

Sec. 404. Distress termination criteria for banking institutions.

Sec. 405. Single sum distributions.

Sec. 406. Adjustments to lien for missed minimum funding contributions.

Sec. 407. Rounding rules for cost-of-living adjustments.

Sec. 408. Funding of restored plans.

Sec. 409. Study of funding status of federal, State, and local government pension plans.

TITLE V--EFFECTIVE DATES AND RELATED RULES

Sec. 501. Effective dates.

Sec. 502. Delay in changes to prevailing commissioners’ table.

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Employee Retirement Income Security Act of 1974

SEC. 101. MINIMUM FUNDING REQUIREMENTS.

(a) AMENDMENTS TO ADDITIONAL FUNDING REQUIREMENTS FOR SINGLE-EMPLOYER PLANS-

(2) RELATIONSHIP OF ADDITIONAL FUNDING REQUIREMENT TO FUNDING STANDARD ACCOUNT CHARGES AND CREDITS-

(A) Clause (ii) of section 302(d)(1)(A) of such Act is amended to read as follows:

‘(ii)(I) for plan years beginning prior to January 1, 2000, the sum of the charges under subsection (b)(2) (other than 5 percent of the charges established prior to January 1, 1995, under clauses (iv) and (v) of subsection (b)(2)(B)), reduced by the sum of the credits under subsection (b)(3) (other than 5 percent of the credits established prior to January 1, 1995, under clauses (ii) and (iii) of subsection (b)(3)(B)), or

‘(II) for plan years beginning after December 31, 1999, the sum of the charges under subsection (b)(2), reduced by the sum of the credits under subparagraph (B) of subsection (b)(3), plus’.

(B) The last sentence in section 302(d)(1) of such Act is amended to read as follows:

‘Such increase shall not exceed the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.’

(3) AMENDMENT TO DEFICIT REDUCTION CONTRIBUTION- Paragraph (2) of section 302(d) of such Act is amended--

(A) by striking ‘plus’ at the end of subparagraph (A);

(B) by striking the period at the end of subparagraph (B) and inserting ‘, and’; and

‘(C) the expected increase in current liability due to benefits accruing during the plan year.’

(4) INCREASE IN UNFUNDED OLD LIABILITY-

(A) Paragraph (3) of section 302(d) of such Act is amended by adding at the end the following new subparagraphs:

‘(D) SPECIAL RULE FOR REQUIRED CHANGES IN ACTUARIAL ASSUMPTIONS-

‘(i) IN GENERAL- The unfunded old liability amount with respect to any plan for any plan year shall be increased by the amount necessary to amortize the amount of additional unfunded old liability under the plan in equal annual installments over a period of 12 plan years (beginning with the first plan year beginning after December 31, 1994).

‘(ii) ADDITIONAL UNFUNDED OLD LIABILITY- For purposes of clause (i), the term ‘additional unfunded old liability’ means the amount (if any) by which--

‘(I) the current liability of the plan as of the beginning of the first plan year beginning after December 31, 1994, valued using the assumptions required by paragraph (7)(C) as in effect for plan years beginning after December 31, 1994, exceeds

‘(II) the current liability of the plan as of the beginning of such first plan year, valued using the same assumptions used under subclause (I) (other than the assumptions required by paragraph (7)(C)), using the prior interest rate, and using such mortality assumptions as were used to determine current liability for the first plan year beginning after December 31, 1992.

‘(iii) PRIOR INTEREST RATE- For purposes of clause (ii), the term ‘prior interest rate’ means the rate of interest that is the same percentage of the weighted average under subsection (b)(5)(B)(ii)(I) for the first plan year beginning after December 31, 1994, as the rate of interest used by the plan to determine current liability for the first plan year beginning after December 31, 1992, is of the weighted average under subsection (b)(5)(B)(ii)(I) for such first plan year beginning after December 31, 1992.

‘(E) OPTIONAL RULE FOR ADDITIONAL UNFUNDED OLD LIABILITY-

‘(i) IN GENERAL- If an election is made under clause (ii), the term ‘additional unfunded old liability’ means (in lieu of the additional unfunded old liability described in clause (ii) of subparagraph (D)), the amount (if any) by which--

‘(I) the unfunded current liability of the plan as of the beginning of the first plan year beginning after December 31, 1994, valued using the assumptions required by paragraph (7)(C) as in effect for plan years beginning after December 31, 1994, exceeds

‘(II) the unamortized portion of the unfunded old liability under the plan as of the beginning of the first plan year beginning after December 31, 1994.

‘(ii) ELECTION-

‘(I) An employer may irrevocably elect, at such time and in such manner as shall be prescribed by the Secretary of the Treasury, to apply the provisions of this subparagraph as of the beginning of the first plan year beginning after December 31, 1994.

‘(II) If an election is made under this clause, the increase under paragraph (1) for any plan year beginning after December 31, 1994, and before January 1, 2002, shall not be less than the increase that would be required under paragraph (1) if the provisions of this title as in effect for plan years beginning before January 1, 1995, had remained in effect.’

(5) APPLICABLE PERCENTAGE FOR DETERMINING UNFUNDED NEW LIABILITY AMOUNT- Subparagraph (C) of section 302(d)(4) of such Act is amended--

(A) by striking ‘.25’ and inserting ‘.40’, and

(B) by striking ‘35’ and inserting ‘60’.

(6) UNPREDICTABLE CONTINGENT EVENT AMOUNT-

(A) Subparagraph (A) of section 302(d)(5) of such Act is amended--

(i) by striking ‘greater of’ and inserting ‘greatest of’ before clause (i);

(ii) by striking ‘or’ at the end of clause (i);

(iii) by striking the period at the end of clause (ii) and inserting ‘, or’; and

(iv) by adding after clause (ii) the following new clause:

‘(iii) the additional amount that would be determined under paragraph (4)(A) if the unpredictable contingent event benefit liabilities were included in unfunded new liability notwithstanding paragraph (4)(B)(ii).’

(B) Paragraph (5) of section 302(d) of such Act is amended by adding at the end the following new subparagraph:

‘(E) LIMITATION- The present value of the amounts described in subparagraph (A) with respect to any one event shall not exceed the unpredictable contingent event benefit liabilities attributable to that event.’

(i) by striking ‘greater of’ and inserting ‘greatest of’ before subclause (I);

(ii) by striking ‘or’ at the end of subclause (I);

(iii) by striking the period at the end of subclause (II) and inserting ‘, or’; and

(iv) by adding after subclause (II) the following new clause:

‘(III) 25 percent of the amount determined under subsection (d)(5)(A)(iii) for the plan year.’

(7) REQUIRED INTEREST RATE AND MORTALITY ASSUMPTIONS FOR DETERMINING CURRENT LIABILITY- Subparagraph (C) of section 302(d)(7) of such Act is amended to read as follows:

‘(C) INTEREST RATE AND MORTALITY ASSUMPTIONS USED- Effective for plan years beginning after December 31, 1994--

‘(i) the rate of interest used to determine current liability under this subsection shall be the rate of interest used under subsection (b)(5), except that the highest rate in the permissible range under subparagraph (B)(ii) thereof shall not exceed 105 percent of the weighted average referred to in such subparagraph, and

‘(ii) the mortality table used to determine current liability under this subsection shall be the table prescribed by the Secretary of the Treasury.

The table prescribed under clause (ii) shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A) of the Internal Revenue Code of 1986) used to determine reserves for group annuity contracts issued on the date as of which current liability is determined (without regard to any other subparagraph of section 807(d)(5) of such Code). The Secretary shall prescribe separate tables, which may be used instead of the table described in the preceding sentence, to calculate mortality rates for participants who satisfy the definition of disability under titles II and XVI of the Social Security Act and the regulations thereunder.’

(8) TRANSITION RULE- Section 302(d) of such Act is amended by adding at the end the following new paragraph:

‘(9) PHASE-IN OF INCREASES IN FUNDING REQUIRED BY RETIREMENT PROTECTION ACT OF 1994-

‘(A) IN GENERAL- For any applicable plan year, at the election of the employer, the increase under paragraph (1) shall not exceed the greater of--

‘(i) the increase that would be required under paragraph (1) if the provisions of this title as in effect for plan years beginning before January 1, 1995, had remained in effect, or

‘(ii) the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) for the applicable plan year to a percentage equal to the sum of the initial funded current liability percentage of the plan plus the applicable number of percentage points for such applicable plan year.

‘(B) APPLICABLE NUMBER OF PERCENTAGE POINTS-

‘(i) INITIAL FUNDED CURRENT LIABILITY PERCENTAGE OF 75 PERCENT OR LESS- Except as provided in clause (ii), for plans with an initial funded current liability percentage of 75 percent or less, the applicable number of percentage points for the applicable plan year is as follows:
‘In the case of applicable

--The applicable number of

plan years beginning in:

--percentage points is:

1995

--3

1996

--6

1997

--9

1998

--12

1999

--15

2000

--19

2001

--24.

‘(ii) OTHER CASES- In the case of a plan to which this clause applies, the applicable number of percentage points for any such applicable plan year is the sum of--

‘(I) 2 percentage points;

‘(II) the applicable number of percentage points (if any) under this clause for the preceding applicable plan year;

‘(III) the product of .10 multiplied by the excess (if any) of (a) 85 percentage points over (b) the sum of the initial funded current liability percentage and the number determined under subclause (II);

‘(IV) for applicable plan years beginning in 2000, 1 percentage point; and

‘(V) for applicable plan years beginning in 2001, 2 percentage points.

‘(iii) PLANS TO WHICH CLAUSE (ii) APPLIES-

‘(I) IN GENERAL- Clause (ii) shall apply to a plan for an applicable plan year if the initial funded current liability percentage of such plan is more than 75 percent.

‘(II) PLANS INITIALLY UNDER CLAUSE (i)- In the case of a plan which (but for this subclause) has an initial funded current liability percentage of 75 percent or less, clause (ii) (and not clause (i)) shall apply to such plan with respect to applicable plan years beginning after the first applicable plan year for which the sum of the initial funded current liability percentage and the applicable number of percentage points (determined under clause (i)) exceeds 75 percent. For purposes of applying clause (ii) to such a plan, the initial funded current liability percentage of such plan shall be treated as being the sum referred to in the preceding sentence.

‘(C) DEFINITIONS- For purposes of this paragraph--

‘(i) The term ‘applicable plan year’ means a plan year beginning after December 31, 1994, and before January 1, 2002.

‘(ii) The term ‘initial funded current liability percentage’ means the funded current liability percentage as of the first day of the first plan year beginning after December 31, 1994.’

(9) LIQUIDITY REQUIREMENT-

(A) Section 302(e) of such Act is amended by redesignating paragraph (5) as paragraph (6) and by inserting after paragraph (4) the following new paragraph:

‘(5) LIQUIDITY REQUIREMENT-

‘(A) IN GENERAL- A plan to which this paragraph applies shall be treated as failing to pay the full amount of any required installment to the extent that the value of the liquid assets paid in such installment is less than the liquidity shortfall (whether or not such liquidity shortfall exceeds the amount of such installment required to be paid but for this paragraph).

‘(B) PLANS TO WHICH PARAGRAPH APPLIES- This paragraph shall apply to a defined benefit plan to which subsection (d) applies and which--

‘(i) is required to pay installments under this subsection for a plan year, and

‘(ii) has a liquidity shortfall for any quarter during such plan year.

‘(C) PERIOD OF UNDERPAYMENT- For purposes of paragraph (1), any portion of an installment that is treated as not paid under subparagraph (A) shall continue to be treated as unpaid until the close of the quarter in which the due date for such installment occurs.

‘(D) LIMITATION ON INCREASE- If the amount of any required installment is increased by reason of subparagraph (A), in no event shall such increase exceed the amount which, when added to prior installments for the plan year, is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.

‘(E) DEFINITIONS- For purposes of this paragraph--

‘(i) LIQUIDITY SHORTFALL- The term ‘liquidity shortfall’ means, with respect to any required installment, an amount equal to the excess (as of the last day of the quarter for which such installment is made) of the base amount with respect to such quarter over the value (as of such last day) of the plan’s liquid assets.

‘(ii) BASE AMOUNT-

‘(I) IN GENERAL- The term ‘base amount’ means, with respect to any quarter, an amount equal to 3 times the sum of the adjusted disbursements from the plan for the 12 months ending on the last day of such quarter.

‘(II) SPECIAL RULE- If the amount determined under clause (i) exceeds an amount equal to 2 times the sum of the adjusted disbursements from the plan for the 36 months ending on the last day of the quarter and an enrolled actuary certifies to the Secretary of the Treasury that such excess is the result of nonrecurring circumstances, the base amount with respect to such quarter shall be determined without regard to amounts related to those nonrecurring circumstances.

‘(iii) DISBURSEMENTS FROM THE PLAN- The term ‘disbursements from the plan’ means all disbursements from the trust, including purchases of annuities, payments of single sums and other benefits, and administrative expenses.

‘(iv) ADJUSTED DISBURSEMENTS- The term ‘adjusted disbursements’ means disbursements from the plan reduced by the product of--

‘(I) the plan’s funded current liability percentage (as defined in subsection (d)(8)) for the plan year, and

‘(II) the sum of the purchases of annuities, payments of single sums, and such other disbursements as the Secretary of the Treasury shall provide in regulations.

‘(v) LIQUID ASSETS- The term ‘liquid assets’ means cash, marketable securities and such other assets as specified by the Secretary of the Treasury in regulations.

‘(vi) QUARTER- The term ‘quarter’ means, with respect to any required installment, the 3-month period preceding the month in which the due date for such installment occurs.

‘(F) REGULATIONS- The Secretary of the Treasury may prescribe such regulations as are necessary to carry out this paragraph.’

(B) LIMITATION ON DISTRIBUTIONS OTHER THAN LIFE ANNUITIES PAID BY THE PLAN-

(i) Section 206 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1056) is amended by adding at the end the following new subsection:

‘(e) Limitation on Distributions Other Than Life Annuities Paid By The Plan-

‘(1) IN GENERAL- Notwithstanding any other provision of this part, the fiduciary of a pension plan that is subject to the additional funding requirements of section 302(d) shall not permit a prohibited payment to be made from a plan during a period in which such plan has a liquidity shortfall (as defined in section 302(e)(5)).

‘(2) PROHIBITED PAYMENT- For purposes of paragraph (1), the term ‘prohibited payment’ means--

‘(A) any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of section 204(b)(1)(G)), to a participant or beneficiary whose annuity starting date (as defined in section 205(h)(2)), that occurs during the period referred to in paragraph (1),

‘(B) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and

‘(C) any other payment specified by the Secretary of the Treasury by regulations.

‘(3) PERIOD OF SHORTFALL- For purposes of this subsection, a plan has a liquidity shortfall during the period that there is an underpayment of an installment under section 302(e) by reason of paragraph (5)(A) thereof.

‘(4) COORDINATION WITH OTHER PROVISIONS- Compliance with this subsection shall not constitute a violation of any other provision of this Act.’

(ii) Section 502 of such Act is amended by adding at the end thereof a new subsection (m) to read as follows:

‘(m) In the case of a distribution to a pension plan participant or beneficiary in violation of section 206(e) by a plan fiduciary, the Secretary shall assess a penalty against such fiduciary in an amount equal to the value of the distribution. Such penalty shall not exceed $10,000 for each such distribution.’

(10) AMENDMENT TO DEFINITION OF FULL FUNDING LIMITATION-

(A) Subparagraph (A) of section 302(c)(7) of such Act is amended--

(i) by inserting ‘(including the expected increase in current liability due to benefits accruing during the plan year)’ after ‘current liability’ in clause (i), and

(ii) by adding at the end the following flush sentences:

‘In no event shall the excess described in the preceding sentence for any plan year be less than the excess (if any) of 90 percent of the current liability of the plan (including the expected increase in current liability due to benefits accruing during the plan year) over the value of the plan’s assets determined under paragraph (2). For purposes of the preceding sentence, the term ‘current liability’ has the meaning given such term by subsection (d)(7) (determined without regard to subsection (d)(7)(D)), and assets shall not be reduced by any credit balance in the funding standard account.’.

(B) Subparagraph (B) of section 302(c)(7) of such Act is amended to read as follows:

‘(B) CURRENT LIABILITY- For purposes of subparagraph (D) and subclause (I) of subparagraph (A)(i), the term ‘current liability’ has the meaning given such term by subsection (d)(7) (without regard to subparagraphs (C) and (D) thereof) and using the rate of interest used under subsection (b)(5)(B).’

(b) EFFECTIVE DATE-

(1) IN GENERAL- The amendments made by this section shall apply to plan years beginning after December 31, 1994.

(2) DELAY IN EFFECTIVE DATE FOR DISABLED LIVES- For plan years beginning before January 1, 1996, current liability may be determined using a plan’s own mortality assumptions for purposes of calculating the mortality rates of disabled lives.

SEC. 102. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

(a) Paragraph (5) of section 302(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(c)(5)) is amended--

(1) by striking ‘If the funding method’ and inserting the following:

‘(A) IN GENERAL- If the funding method’, and

(2) by adding at the end the following new subparagraph:

‘(B) APPROVAL REQUIRED FOR CERTAIN CHANGES IN ASSUMPTIONS BY CERTAIN SINGLE EMPLOYER PLANS SUBJECT TO ADDITIONAL FUNDING REQUIREMENT-

‘(i) IN GENERAL- No actuarial assumption (other than the assumptions described in subsection (d)(7)(C)) used to determine the current liability for a plan to which this subparagraph applies may be changed without the approval of the Secretary of the Treasury.

‘(ii) PLANS TO WHICH SUBPARAGRAPH APPLIES- This subparagraph shall apply to a plan only if--

‘(I) subsection (d) applies to the plan;

‘(II) the employer (within the meaning of section 302(c)(11) (without regard to subparagraph (B) thereof)) maintaining such plan is described in section 4043(b)(1); and

‘(III) the change in assumptions (determined after taking into account any changes in interest rate and mortality table) results in a decrease in the unfunded current liability of the plan for the current plan year that is $50,000,000 or greater, or that is $5,000,000 or greater and that is 5 percent or more of the current liability of the plan before such change.’

(b) EFFECTIVE DATE-

(1) IN GENERAL- The amendment made by this section shall apply to changes in assumptions for plan years beginning after October 28, 1993.

(A) such change would have required the approval of the Secretary of the Treasury had such amendment applied to such change, and

(B) such change is not so approved.

SEC. 103. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

(a) IN GENERAL- Section 302(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(c)) is amended by adding at the end the following new paragraph:

‘(12) ANTICIPATION OF BENEFIT INCREASES EFFECTIVE IN THE FUTURE- In determining projected benefits, the funding method of a collectively bargained plan described in section 413(a) of the Internal Revenue Code of 1986 (other than a multiemployer plan) shall anticipate benefit increases scheduled to take effect during the term of the collective bargaining agreement applicable to the plan.’

SEC. 104. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

(a) IN GENERAL- Paragraph (1) of section 302(e) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(e)) is amended--

(1) by inserting ‘which has a funded current liability percentage (as defined in subsection (d)(8)) for the preceding plan year of less than 100 percent’ before ‘fails’, and

(2) by striking ‘any plan year’ and inserting ‘the plan year’.

(b) EFFECTIVE DATE- The amendment made by this section shall apply to plan years beginning after the date of enactment of this Act.

Subtitle B--Amendments to the Internal Revenue Code of 1986

SEC. 121. MINIMUM FUNDING REQUIREMENTS.

(a) Amendments to Additional Funding Requirements for Single-Employer Plans-

(2) Relationship of additional funding requirement to funding standard account charges and credits-

(A) Clause (ii) of section 412(l)(1)(A) of such Code is amended to read as follows:

‘(ii)(I) for plan years beginning prior to January 1, 2000, the sum of the charges under subsection (b)(2) (other than 5 percent of the charges established prior to January 1, 1995, under clauses (iv) and (v) of subsection (b)(2)(B)), reduced by the sum of the credits under subsection (b)(3) (other than 5 percent of the credits established prior to January 1, 1995, under clauses (ii) and (iii) of subsection (b)(3)(B)), or

‘(II) for plan years beginning after December 31, 1999, the sum of the charges under subsection (b)(2), reduced by the sum of the credits under subparagraph (B) of subsection (b)(3), plus’.

(B) The last sentence in section 412(l)(1) of such Code is amended to read as follows:

‘Such increase shall not exceed the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.’

(3) AMENDMENT TO DEFICIT REDUCTION CONTRIBUTION- Paragraph (2) of section 412(l) of such Code is amended--

(A) by striking ‘plus’ at the end of subparagraph (A),

(B) by striking the period at the end of subparagraph (B) and inserting ‘, and’; and

‘(C) the expected increase in current liability due to benefits accruing during the plan year.’

(4) Increase in unfunded old liability-

(A) Paragraph (3) of section 412(l) of such Code is amended by adding at the end the following new subparagraphs:

‘(D) Special rule for required changes in actuarial assumptions-

‘(i) IN GENERAL- The unfunded old liability amount with respect to any plan for any plan year shall be increased by the amount necessary to amortize the amount of additional unfunded old liability under the plan in equal annual installments over a period of 12 plan years (beginning with the first plan year beginning after December 31, 1994).

‘(ii) ADDITIONAL UNFUNDED OLD LIABILITY- For purposes of clause (i), the term ‘additional unfunded old liability’ means the amount (if any) by which--

‘(I) the current liability of the plan as of the beginning of the first plan year beginning after December 31, 1994, valued using the assumptions required by paragraph (7)(C) as in effect for plan years beginning after December 31, 1994, exceeds

‘(II) the current liability of the plan as of the beginning of such first plan year, valued using the same assumptions used under subclause (I) (other than the assumptions required by paragraph (7)(C)), using the prior interest rate, and using such mortality assumptions as were used to determine current liability for the first plan year beginning after December 31, 1992.

‘(iii) PRIOR INTEREST RATE- For purposes of clause (ii), the term ‘prior interest rate’ means the rate of interest that is the same percentage of the weighted average under subsection (b)(5)(B)(ii)(I) for the first plan year beginning after December 31, 1994, as the rate of interest used by the plan to determine current liability for the first plan year beginning after December 31, 1992, is of the weighted average under subsection (b)(5)(B)(ii)(I) for such first plan year beginning after December 31, 1992.

‘(E) OPTIONAL RULE FOR ADDITIONAL UNFUNDED OLD LIABILITY-

‘(i) IN GENERAL- If an election is made under clause (ii), the term ‘additional unfunded old liability’ means (in lieu of the additional unfunded old liability described in clause (ii) of subparagraph (D)), the amount (if any) by which--

‘(I) the unfunded current liability of the plan as of the beginning of the first plan year beginning after December 31, 1994, valued using the assumptions required by paragraph (7)(C) as in effect for plan years beginning after December 31, 1994, exceeds

‘(II) the unamortized portion of the unfunded old liability under the plan as of the beginning of the first plan year beginning after December 31, 1994.

‘(ii) ELECTION-

‘(I) An employer may irrevocably elect, at such time and in such manner as shall be prescribed by the Secretary, to apply the provisions of this subparagraph as of the beginning of the first plan year beginning after December 31, 1994.

‘(II) If an election is made under this clause, the increase under paragraph (1) for any plan year beginning after December 31, 1994, and before January 1, 2002, shall not be less than the increase that would be required under paragraph (1) if the provisions of this title as in effect for plan years beginning before January 1, 1995, had remained in effect.’

(5) APPLICABLE PERCENTAGE FOR DETERMINING UNFUNDED NEW LIABILITY AMOUNT- Subparagraph (C) of section 412(l)(4) of such Code is amended--

(A) by striking ‘.25’ and inserting ‘.40’, and

(B) by striking ‘35’ and inserting ‘60’.

(6) UNPREDICTABLE CONTINGENT EVENT AMOUNT-

(A) Subparagraph (A) of section 412(l)(5) of such Code is amended--

(i) by striking ‘greater of’ and inserting ‘greatest of’ before clause (i);

(ii) by striking ‘or’ at the end of clause (i);

(iii) by striking the period at the end of clause (ii) and inserting ‘, or’; and

(iv) by adding after clause (ii) the following new clause:

‘(iii) the additional amount that would be determined under paragraph (4)(A) if the unpredictable contingent event benefit liabilities were included in unfunded new liability notwithstanding paragraph (4)(B)(ii).’

(B) Paragraph (5) of section 412(l) of such Code is amended by adding at the end the following new subparagraph:

‘(E) LIMITATION- The present value of the amounts described in subparagraph (A) with respect to any one event shall not exceed the unpredictable contingent event benefit liabilities attributable to that event.’

(i) by striking ‘greater of’ and inserting ‘greatest of’ before subclause (I);

(ii) by striking ‘or’ at the end of subclause (I);

(iii) by striking the period at the end of subclause (II) and inserting ‘, or’; and

(iv) by adding after subclause (II) the following new subclause:

‘(III) 25 percent of the amount determined under subsection (l)(5)(A)(iii) for the plan year.’

(7) REQUIRED INTEREST RATE AND MORTALITY ASSUMPTIONS FOR DETERMINING CURRENT LIABILITY- Subparagraph (C) of section 412(l)(7) of such Code is amended to read as follows:

‘(C) INTEREST RATE AND MORTALITY ASSUMPTIONS USED- Effective for plan years beginning after December 31, 1994--

‘(i) the rate of interest used to determine current liability under this subsection shall be the rate of interest used under subsection (b)(5), except that the highest rate in the permissible range under subparagraph (B)(ii) thereof shall not exceed 105 percent of the weighted average referred to in such subparagraph, and

‘(ii) the mortality table used to determine current liability under this subsection shall be the table prescribed by the Secretary.

The table prescribed under clause (ii) shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A)) used to determine reserves for group annuity contracts issued on the date as of which current liability is determined (without regard to any other subparagraph of section 807(d)(5)). The Secretary shall prescribe separate tables, which may be used instead of the table described in the preceding sentence, to calculate mortality rates for participants who satisfy the definition of disability under titles II and XVI of the Social Security Act and the regulations thereunder.’

(8) TRANSITION RULE- Section 412(l) of such Code is amended by adding at the end the following new paragraph:

‘(9) PHASE-IN OF INCREASES IN FUNDING REQUIRED BY RETIREMENT PROTECTION ACT OF 1994-

‘(A) IN GENERAL- For any applicable plan year, at the election of the employer, the increase under paragraph (1) shall not exceed the greater of--

‘(i) the increase that would be required under paragraph (1) if the provisions of this title as in effect for plan years beginning before January 1, 1995, had remained in effect, or

‘(ii) the amount which, after taking into account charges (other than the additional charge under this subsection) and credits under subsection (b), is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) for the applicable plan year to a percentage equal to the sum of the initial funded current liability percentage of the plan plus the applicable number of percentage points for such applicable plan year.

‘(B) APPLICABLE NUMBER OF PERCENTAGE POINTS-

‘(i) INITIAL FUNDED CURRENT LIABILITY PERCENTAGE OF 75 PERCENT OR LESS- Except as provided in clause (ii), for plans with an initial funded current liability percentage of 75 percent or less, the applicable number of percentage points for the applicable plan year is as follows:
‘In the case of applicable

--The applicable number of

plan years beginning in:

--percentage points is:

1995

--3

1996

--6

1997

--9

1998

--12

1999

--15

2000

--19

2001

--24.

‘(ii) OTHER CASES- In the case of a plan to which this clause applies, the applicable number of percentage points for any such applicable plan year is the sum of--

‘(I) 2 percentage points;

‘(II) the applicable number of percentage points (if any) under this clause for the preceding applicable plan year;

‘(III) the product of .10 multiplied by the excess (if any) of (a) 85 percentage points over (b) the sum of the initial funded current liability percentage and the number determined under subclause (II);

‘(IV) for applicable plan years beginning in 2000, 1 percentage point; and

‘(V) for applicable plan years beginning in 2001, 2 percentage points.

‘(iii) PLANS TO WHICH CLAUSE (ii) APPLIES-

‘(I) IN GENERAL- Clause (ii) shall apply to a plan for an applicable plan year if the initial funded current liability percentage of such plan is more than 75 percent.

‘(II) PLANS INITIALLY UNDER CLAUSE (i)- In the case of a plan which (but for this subclause) has an initial funded current liability percentage of 75 percent or less, clause (ii) (and not clause (i)) shall apply to such plan with respect to applicable plan years beginning after the first applicable plan year for which the sum of the initial funded current liability percentage and the applicable number of percentage points (determined under clause (i)) exceeds 75 percent. For purposes of applying clause (ii) to such a plan, the initial funded current liability percentage of such plan shall be treated as being the sum referred to in the preceding sentence.

‘(C) DEFINITIONS- For purposes of this paragraph--

‘(i) The term ‘applicable plan year’ means a plan year beginning after December 31, 1994, and before January 1, 2002.

‘(ii) The term ‘initial funded current liability percentage’ means the funded current liability percentage as of the first day of the first plan year beginning after December 31, 1994.’

(9) Liquidity requirement-

(A) Section 412(m) of such Code is amended by redesignating paragraph (5) as paragraph (6) and by inserting after paragraph (4) the following new paragraph:

‘(5) LIQUIDITY REQUIREMENT-

‘(A) IN GENERAL- A plan to which this paragraph applies shall be treated as failing to pay the full amount of any required installment to the extent that the value of the liquid assets paid in such installment is less than the liquidity shortfall (whether or not such liquidity shortfall exceeds the amount of such installment required to be paid but for this paragraph).

‘(B) PLANS TO WHICH PARAGRAPH APPLIES- This paragraph shall apply to a defined benefit plan to which subsection (l) applies and which--

‘(i) is required to pay installments under this subsection for a plan year, and

‘(ii) has a liquidity shortfall for any quarter during such plan year.

‘(C) PERIOD OF UNDERPAYMENT- For purposes of paragraph (1), any portion of an installment that is treated as not paid under subparagraph (A) shall continue to be treated as unpaid until the close of the quarter in which the due date for such installment occurs.

‘(D) LIMITATION ON INCREASE- If the amount of any required installment is increased by reason of subparagraph (A), in no event shall such increase exceed the amount which, when added to prior installments for the plan year, is necessary to increase the funded current liability percentage (taking into account the expected increase in current liability due to benefits accruing during the plan year) to 100 percent.

‘(E) DEFINITIONS- For purposes of this paragraph--

‘(i) LIQUIDITY SHORTFALL- The term ‘liquidity shortfall’ means, with respect to any required installment, an amount equal to the excess (as of the last day of the quarter for which such installment is made) of the base amount with respect to such quarter over the value (as of such last day) of the plan’s liquid assets.

‘(ii) BASE AMOUNT-

‘(I) IN GENERAL- The term ‘base amount’ means, with respect to any quarter, an amount equal to 3 times the sum of the adjusted disbursements from the plan for the 12 months ending on the last day of such quarter.

‘(II) SPECIAL RULE- If the amount determined under clause (i) exceeds an amount equal to 2 times the sum of the adjusted disbursements from the plan for the 36 months ending on the last day of the quarter and an enrolled actuary certifies to the Secretary that such excess is the result of nonrecurring circumstances, the base amount with respect to such quarter shall be determined without regard to amounts related to those nonrecurring circumstances.

‘(iii) DISBURSEMENTS FROM THE PLAN- The term ‘disbursements from the plan’ means all disbursements from the trust, including purchases of annuities, payments of single sums and other benefits, and administrative expenses.

‘(iv) ADJUSTED DISBURSEMENTS- The term ‘adjusted disbursements’ means disbursements from the plan reduced by the product of--

‘(I) the plan’s funded current liability percentage (as defined in subsection (l)(8)) for the plan year, and

‘(II) the sum of the purchases of annuities, payments of single sums, and such other disbursements as the Secretary shall provide in regulations.

‘(v) LIQUID ASSETS- The term ‘liquid assets’ means cash, marketable securities and such other assets as specified by the Secretary in regulations.

‘(vi) QUARTER- The term ‘quarter’ means, with respect to any required installment, the 3-month period preceding the month in which the due date for such installment occurs.

‘(F) REGULATIONS- The Secretary may prescribe such regulations as are necessary to carry out this paragraph.’

(B) EXCISE TAX ON UNPAID LIQUIDITY SHORTFALL-

(i) Subsection (e) of section 4971 of such Code is amended by striking ‘(a) or (b)’ wherever it appears and replacing it with ‘(a), (b) or (f)’.

(ii) Section 4971 of such Code is amended by redesignating subsection (f) as subsection (g) and adding a new subsection (f) to read as follows:

‘(f) FAILURE TO PAY LIQUIDITY SHORTFALL-

‘(1) IN GENERAL- In the case of a plan to which section 412(m)(5) applies, there is hereby imposed a tax of 10 percent of the excess (if any) of--

‘(A) the amount of the liquidity shortfall for any quarter, over

‘(B) the amount of such shortfall which is paid by the required installment under section 412(m) for such quarter (but only if such installment is paid on or before the due date for such installment).

‘(2) ADDITIONAL TAX- If the plan has a liquidity shortfall as of the close of any quarter and as of the close of each of the following 4 quarters, there is hereby imposed a tax equal to 100 percent of the amount on which tax was imposed by paragraph (1) for such first quarter.

‘(3) DEFINITIONS AND SPECIAL RULE-

‘(A) LIQUIDITY SHORTFALL; QUARTER- For purposes of this subsection, the terms ‘liquidity shortfall’ and ‘quarter’ have the respective meanings given such terms by section 412(m)(5).

‘(B) SPECIAL RULE- If the tax imposed by paragraph (2) is paid with respect to any liquidity shortfall for any quarter, no further tax shall be imposed by this subsection on such shortfall for such quarter.’

(C) TREATMENT OF FAILURE TO MAKE CERTAIN PAYMENTS IF PLAN HAS LIQUIDITY SHORTFALL- Section 401(a) of such Code is amended by adding at the end the following new paragraph:

‘(32) TREATMENT OF FAILURE TO MAKE CERTAIN PAYMENTS IF PLAN HAS LIQUIDITY SHORTFALL-

‘(A) IN GENERAL- A trust forming part of a pension plan to which section 412(m)(5) applies shall not be treated as failing to constitute a qualified trust under this section merely because such plan ceases to make any payment described in subparagraph (B) during any period that such plan has a liquidity shortfall (as defined in section 412(m)(5)).

‘(B) PAYMENTS DESCRIBED- A payment is described in this subparagraph if such payment is--

‘(i) any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of section 411(a)(9)), to a participant or beneficiary whose annuity starting date (as defined in section 417(f)(2)) occurs during the period referred to in subparagraph (A),

‘(ii) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and

‘(iii) any other payment specified by the Secretary by regulations.

‘(C) PERIOD OF SHORTFALL- For purposes of this paragraph, a plan has a liquidity shortfall during the period that there is an underpayment of an installment under section 412(m) by reason of paragraph (5)(A) thereof.’

(10) AMENDMENT TO DEFINITION OF FULL FUNDING LIMITATION-

(A) Subparagraph (A) of section 412(c)(7) of such Code is amended--

(i) by inserting ‘(including the expected increase in current liability due to benefits accruing during the plan year)’ after ‘current liability’ in clause (i), and

(ii) by adding at the end the following flush sentences:

‘In no event shall the excess described in the preceding sentence for any plan year be less than the excess (if any) of 90 percent of the current liability of the plan (including the expected increase in current liability due to benefits accruing during the plan year) over the value of the plan’s assets determined under paragraph (2). For purposes of the preceding sentence, the term ‘current liability’ has the meaning given such term by subsection (l)(7) (determined without regard to subsection (l)(7)(D)), and assets shall not be reduced by any credit balance in the funding standard account.’.

(B) Subparagraph (B) of section 412(c)(7) of such Code is amended to read as follows:

‘(B) CURRENT LIABILITY- For purposes of subparagraph (D) and subclause (I) of subparagraph (A)(i), the term ‘current liability’ has the meaning given such term by subsection (l)(7) (without regard to subparagraphs (C) and (D) thereof) and using the rate of interest used under subsection (b)(5)(B).’

(b) EFFECTIVE DATE-

(1) IN GENERAL- The amendments made by this section shall apply to plan years beginning after December 31, 1994.

SEC. 122. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

(a) IN GENERAL- Paragraph (5) of section 412(c) of the Internal Revenue Code of 1986 is amended--

(1) by striking ‘If the funding method’ and inserting the following:

‘(A) IN GENERAL- If the funding method’, and

(2) by adding at the end the following new subparagraph:

‘(B) APPROVAL REQUIRED FOR CERTAIN CHANGES IN ASSUMPTIONS BY CERTAIN SINGLE EMPLOYER PLANS SUBJECT TO ADDITIONAL FUNDING REQUIREMENT-

‘(i) IN GENERAL- No actuarial assumption (other than the assumptions described in subsection (l)(7)(C)) used to determine the current liability for a plan to which this subparagraph applies may be changed without the approval of the Secretary.

‘(ii) PLANS TO WHICH SUBPARAGRAPH APPLIES- This subparagraph shall apply to a plan only if--

‘(I) subsection (l) applies to the plan;

‘(II) the employer (within the meaning of section 412(c)(11) (without regard to subparagraph (B) thereof)) maintaining such plan is described in section 4043(b)(1) of the Employee Retirement Income Security Act of 1974; and

‘(III) the change in assumptions (determined after taking into account any changes in interest rate and mortality table) results in a decrease in the unfunded current liability of the plan for the current plan year that is $50,000,000 or greater, or that is $5,000,000 or greater and that is 5 percent or more of the current liability of the plan before such change.’

(b) EFFECTIVE DATE-

(1) IN GENERAL- The amendment made by this section shall apply to changes in assumptions for plan years beginning after October 28, 1993.

(A) such change would have required the approval of the Secretary of the Treasury had such amendment applied to such change, and

(B) such change is not so approved.

SEC. 123. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

(a) IN GENERAL- Section 412(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

‘(12) ANTICIPATION OF BENEFIT INCREASES EFFECTIVE IN THE FUTURE- In determining projected benefits, the funding method of a collectively bargained plan described in section 413(a) (other than a multiemployer plan) shall anticipate benefit increases scheduled to take effect during the term of the collective bargaining agreement applicable to the plan.’

SEC. 124. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

(a) IN GENERAL- Paragraph (1) of section 412(m) of the Internal Revenue Code of 1986 is amended--

(1) by inserting ‘which has a funded current liability percentage (as defined in subsection (l)(8)) for the preceding plan year of less than 100 percent’ before ‘fails’, and

(2) by striking ‘any plan year’ and inserting ‘the plan year’.

(b) EFFECTIVE DATE- The amendment made by this section shall apply to plan years beginning after the date of enactment of this Act.

SEC. 125. EXCEPTIONS TO EXCISE TAX ON NONDEDUCTIBLE CONTRIBUTIONS.

(a) IN GENERAL- Section 4972(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

‘(6) EXCEPTIONS- In determining the amount of nondeductible contributions for any taxable year, there shall not be taken into account--

‘(A) contributions that would be deductible under section 404(a)(1)(D) if the plan had more than 100 participants if--

‘(i) the plan is covered under section 4021 of the Employee Retirement Income Security Act of 1974, and

‘(ii) the plan is terminated under section 4041(b) of such Act on or before the last day of the taxable year, and

‘(B) contributions to a defined contribution plan which--

‘(i) do not exceed 6 percent of compensation (within the meaning of section 404(a)(7)(A)(i)) paid or accrued (during the taxable year for which the contributions were made) to beneficiaries under the plan, and

‘(ii) are not deductible when contributed solely because of section 404(a)(7).

If one or more defined benefit plans were taken into account in determining the amount allowable as a deduction under section 404 for contributions to any defined contribution plan, subparagraph (B) shall apply only if all such defined benefit plans are described in section 404(a)(1)(D). For purposes of subparagraph (B), the deductible limits under section 404(a)(7) shall first be applied to amounts contributed to a defined benefit plan and then to amounts described in subparagraph (B).’

(b) EFFECTIVE DATE-

(1) SECTION 4972(c)(6)(A)- Section 4972(c)(6)(A) of the Internal Revenue Code of 1986 (as added by this section) shall apply to taxable years ending on or after the date of enactment of this Act.

(2) SECTION 4972(c)(6)(B)- Section 4972(c)(6)(B) of such Code (as added by this section) shall apply to taxable years ending on or after December 31, 1992.

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

SEC. 201. REPORTABLE EVENTS.

(a) RESPONSIBILITY FOR REPORTABLE EVENTS REPORTING- Section 4043(a) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1343(a)) is amended--

(1) in the first sentence, by inserting ‘or the contributing sponsor’ before ‘knows or has reason to know’;

(2) in the first sentence, by inserting ‘, unless a notice otherwise required under this subsection has already been provided with respect to such event’ before the period at the end; and

(3) by striking the last sentence.

‘(b)(1) The requirements of this subsection shall be applicable to a contributing sponsor only if the aggregate unfunded vested benefits at the end of the preceding plan year (as determined under section 4006(a)(3)(E)(iii)) of plans which are maintained by such sponsor and the members of such sponsor’s controlled group and are covered by this title exceed $50,000,000 (taking into account only those plans with unfunded vested benefits).

‘(2) No later than 30 days prior to the effective date of an event described in paragraph (9), (10), (11), (12), or (13) of subsection (c), a contributing sponsor to which the requirements of this subsection apply shall notify the corporation that the event is about to occur.

‘(3) The corporation may waive the requirement of this subsection with respect to any or all reportable events with respect to any contributing sponsor.’

(1) by striking the ‘or’ at the end of paragraph (8);

(2) by striking paragraph (9); and

(3) by inserting after paragraph (8) the following new paragraphs:

‘(9) when, as a result of an event, a person ceases to be a member of the controlled group;

‘(10) when a contributing sponsor or a member of a contributing sponsor’s controlled group liquidates in a case under title 11, United States Code, or under any similar Federal law or law of a State or political subdivision of a State;

‘(11) when a contributing sponsor or a member of a contributing sponsor’s controlled group declares an extraordinary dividend (as defined in section 1059(c) of the Internal Revenue Code of 1986) or redeems, in any 12-month period, an aggregate of 10 percent or more of the total combined voting power of all classes of stock entitled to vote, or an aggregate of 10 percent of more of the total value of shares of all classes of stock, of a contributing sponsor and all members of its controlled group;

‘(12) when, in any 12-month period, an aggregate of 3 percent or more of the benefit liabilities of a plan covered by this title and maintained by a contributing sponsor or a member of its controlled group are transferred to a person that is not a member of the controlled group or to a plan or plans maintained by a person or persons that are not such a contributing sponsor or a member of its controlled group; or

‘(13) when any other event occurs that may be indicative of a need to terminate the plan and that is prescribed by the corporation in regulations.’

(d) DISCLOSURE EXEMPTION- Section 4043 of such Act is amended by adding at the end the following new subsection:

‘(f) Any information or documentary material submitted to the corporation pursuant to this section or section 4050(c) shall be exempt from disclosure under section 552 of title 5, United States Code, and no such information or documentary material may be made public, except as may be relevant to any administrative or judicial action or proceeding. Nothing in this section is intended to prevent disclosure to either body of Congress or to any duly authorized committee or subcommittee of the Congress.’

(e) TECHNICAL AND CONFORMING AMENDMENTS-

(2) Section 4042(a)(3) of such Act is amended by striking ‘4043(b)(7)’ and inserting ‘4043(c)(7)’.

(f) EFFECTIVE DATE- The amendments made by this section shall be effective for events occurring 60 days or more after the date of enactment of this Act.

SEC. 202. ALTERNATIVE TO INVOLUNTARY TERMINATION.

(a) IN GENERAL- Subtitle C of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341 et seq.) is amended by adding at the end the following new section:

‘JUDICIAL RELIEF OTHER THAN INVOLUNTARY TERMINATION

‘SEC. 4050. (a) INSTITUTION OF PROCEEDINGS-

‘(1) IN GENERAL- Whenever the corporation determines (without regard to the potential availability of relief under this section) that, upon the occurrence of an event described in paragraph (9), (10), (11), (12), or (13) of section 4043(c), the possible long-run loss of the corporation with respect to a plan may reasonably be expected to increase unreasonably if the plan is not terminated, the corporation may, in its discretion, institute proceedings under this section as an alternative to instituting proceedings under section 4042 to terminate the plan.

‘(2) LIMITATION- In the case of an event described in paragraph (9) or (13) of section 4043(c), this section shall apply only if, immediately after the effective date of the event, the total revenues, the total operating income, or the total assets of a contributing sponsor and all members of its controlled group would be less than 90 percent of the total revenues, the total operating income, or the total assets, respectively, of a contributing sponsor and all members of its controlled group immediately before the effective date of the event. For purposes of this paragraph, all events occurring in any 12-month period shall be treated as a single event.

‘(b) Whenever the corporation makes a determination under subsection (a), it may, upon notice to a contributing sponsor, apply to the appropriate United States district court for such legal or equitable relief as the corporation deems appropriate and consistent with its duties under this title. The court shall grant such relief as it determines necessary to protect the interests of the participants or to avoid any unreasonable deterioration of the financial condition of the plan or any unreasonable increase in the liability of the fund, without interfering unreasonably with the business of the contributing sponsor or members of its controlled group.

‘(c)(1) In any case in which the corporation is provided with a notice required by subsection 4043(b) within the time specified in that subsection, the corporation may bring an action under this section no later than 30 days after the date such notice is received. Notwithstanding the preceding sentence, the corporation may, no later than 30 days after the date such notice is received, require the submission of additional information or documentary material, in which case an action under this section may be brought no later than 20 days after the corporation receives all the information and documentary material it had required.

‘(2) After a notice described in paragraph (1) is provided to the corporation, a person may elect, upon further notice to the corporation, to proceed with an event prior to the expiration of the time periods described in paragraph (1). In the case of such an election, an action under this section may be brought at any time within the period specified in subsection 4003(e)(6).

‘(3) In any case in which the corporation is not provided with a notice required by subsection (b) of section 4043 by the time specified in that subsection, in any case in which a person fails or refuses to provide the additional information or documentary material required by the corporation under paragraph (1), or in any case in which a person proceeds with an event without providing the corporation with the further notice required under paragraph (2) with respect to such event, an action under this section may be brought at any time within the time period specified in subsection 4003(e)(6).

‘(4) Except as provided in paragraph (1), (2), or (3), an action under this section may not be brought after the effective date of the event giving rise to the transaction.

‘(5) For purposes of applying subsection 4003(e)(6) to paragraphs (2) and (3), a cause of action shall be deemed to arise on the effective date of the event.

‘(d) Nothing in this section shall limit the authority of the corporation to initiate proceedings to terminate a plan under section 4042, or to initiate proceedings or to seek relief under any other provision of this title or any other law.’

(c) CLERICAL AMENDMENT- The table of contents contained in section 1 of such Act is amended by inserting after the item relating to section 4048 the following new item:

‘Sec. 4050. Judicial relief other than involuntary termination.’

(d) EFFECTIVE DATE- The amendments made by this section shall be effective for events occurring 60 days or more after the date of the enactment of this Act.

SEC. 203. CERTAIN INFORMATION REQUIRED TO BE FURNISHED TO PBGC.

(a) GENERAL RULE- Subtitle A of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1301 et seq.) is amended by adding at the end the following new section:

‘SEC. 4010. AUTHORITY TO REQUIRE CERTAIN INFORMATION.

‘(a) INFORMATION REQUIRED- Each person described in subsection (b) shall provide the corporation annually, on or before a date specified by the corporation in regulations, with--

‘(1) such records, documents, or other information that the corporation specifies in regulations as necessary to determine the liabilities and assets of plans covered by this title; and

‘(2) copies of such person’s audited (or, if unavailable, unaudited) financial statements, and such other financial information as the corporation may prescribe in regulations.

‘(b) PERSONS REQUIRED TO PROVIDE INFORMATION- The persons covered by subsection (a) are each contributing sponsor, and each member of a contributing sponsor’s controlled group, of a single-employer plan covered by this title, if--

‘(1) the aggregate unfunded vested benefits at the end of the preceding plan year (as determined under section 4006(a)(3)(E)(iii)) of plans which are maintained by the contributing sponsor and the members of its controlled group and are covered by this title exceed $50,000,000 (taking into account only those plans of the contributing sponsor and its controlled group with unfunded vested benefits); or

‘(2) the conditions for imposition of a lien described in section 302(f)(1)(A) and (B) of this Act or section 412(n)(1)(A) and (B) of the Internal Revenue Code of 1986 have been met with respect to any plan maintained by the contributing sponsor or any member of its controlled group; or

‘(3) minimum funding waivers in excess of $1,000,000 have been granted with respect to any plan maintained by the contributing sponsor or any member of its controlled group, and any portion thereof is still outstanding.

‘(c) INFORMATION EXEMPT FROM DISCLOSURE REQUIREMENTS- Any information or documentary material submitted to the corporation pursuant to this section shall be exempt from disclosure under section 552 of title 5, United States Code, and no such information or documentary material may be made public, except as may be relevant to any administrative or judicial action or proceeding. Nothing in this section is intended to prevent disclosure to either body of Congress or to any duly authorized committee or subcommittee of the Congress.’

(b) CLERICAL AMENDMENT- The table of contents contained in section 1 of such Act is amended by inserting after the item relating to section 4009 the following new item:

‘Sec. 4010. Authority to require certain information.’

SEC. 204. LIABILITY UPON LIQUIDATION OF CONTRIBUTING SPONSOR OR CONTROLLED GROUP MEMBER IF PLAN REMAINS ONGOING.

(a) IN GENERAL- Section 4062 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1362) is amended by adding at the end the following new subsection:

‘(f) LIABILITY ON LIQUIDATION OF CONTRIBUTING SPONSOR OR CONTROLLED GROUP MEMBER-

‘(1) IN GENERAL- In any case in which--

‘(A) all or substantially all of the assets of a person who is a contributing sponsor of a single-employer plan, or a member of a controlled group of a contributing sponsor of a single-employer plan, are liquidated--

‘(i) in a case under chapter 7 of title 11, United States Code,

‘(ii) in a case under chapter 11 of such title 11 in which--

‘(I) the plan confirmed under such chapter 11 provides for the liquidation of all or substantially all of the property of the estate, and

‘(II) the debtor does not engage in business after the confirmation of such plan, or

‘(iii) under any similar Federal law or law of a State or political subdivision of a State, and

‘(B) the single-employer plan is not terminated,

such person shall be deemed liable under subsection (b) as if the single-employer plan had terminated under section 4041(c) in the course of such liquidation and as if the termination date were the date determined by the corporation as the date on which the liquidation was initiated.

‘(2) LIMITED JOINT AND SEVERAL LIABILITY- The liability under this subsection shall be joint and several only among the members of the controlled group (including, where applicable, the contributing sponsor) who are liquidating as described in paragraph (1).

‘(3) APPLICABILITY OF OTHER PROVISIONS- Except as provided in paragraph (2), any provision of this Act or any other provision of law that applies to liability under the preceding subsections of this section upon termination of a plan shall apply in the same manner and to the same extent to the liability established under this subsection. For purposes of this paragraph, the date referred to in paragraph (1) shall be deemed the termination date.

‘(4) LIABILITY OWED TO PLAN; TRANSFER OF LIABILITY PAYMENTS TO THE ONGOING PLAN WHERE COLLECTED BY THE CORPORATION- The liability established under this subsection shall be owed to the plan, and may be collected by either the plan or the corporation. The corporation shall pay to the plan any amounts collected by the corporation in satisfaction of the liability established under this subsection in connection with such plan.

‘(5) REGULATIONS- The corporation may prescribe regulations under this subsection, including--

‘(A) rules governing--

‘(i) the determination of whether and when a liquidation referred to in this subsection has occurred, and

‘(ii) the assignment of the plan’s or corporation’s claim to liability payments under this subsection to other members of the controlled group as a means of collecting such payments, subject to the transfer of such payments to the plan, and

‘(B) rules providing alternative arrangements for making liability payments under this subsection.’

(b) CONFORMING AMENDMENT- Section 4062(a) of such Act is amended--

(1) in paragraph (1), by striking ‘and’ after ‘subsection (b),’;

(2) in paragraph (2), by striking the period after ‘subsection (c)’ and inserting ’, and’; and

(3) by adding at the end the following new paragraph:

‘(3) liability to the plan, to the extent provided in subsection (f).’

(1) ERISA- Section 302(c) of the Employee Retirement Income Security Act of 1974 is amended by adding at the end the following new paragraph:

‘(13) TREATMENT OF LIABILITY ON LIQUIDATION OF EMPLOYER- Any amount paid to a plan pursuant to section 4062(f)--

‘(A) shall be treated as not contributed by the employer for purposes of subsection (b)(3)(A), and

‘(B) shall be treated as a net experience gain of the plan under subsection (b)(3)(B)(ii).’

(2) 1986 CODE- Section 412(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

‘(13) TREATMENT OF LIABILITY ON LIQUIDATION OF EMPLOYER- Any amount paid to a plan pursuant to section 4062(f) of the Employee Retirement Income Security Act of 1974--

‘(A) shall be treated as not contributed by the employer for purposes of subsection (b)(3)(A), and

‘(B) shall be treated as a net experience gain of the plan under subsection (b)(3)(B)(ii).’

(d) EFFECTIVE DATE- The amendments made by this section shall be effective for liquidations initiated on or after the date of enactment of this Act.

SEC. 205. ENFORCEMENT OF MINIMUM FUNDING REQUIREMENTS.

(a) IN GENERAL- Paragraph (1) of section 4003(e) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1303(e)(1)) is amended--

(1) by inserting ‘(A)’ after ‘enforce’; and

SEC. 206. REMEDIES FOR NONCOMPLIANCE WITH REQUIREMENTS FOR STANDARD TERMINATION.

(a) NOTICE OF NONCOMPLIANCE- Section 4041(b)(2)(C)(i) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341(b)(2)(C)(i)) is amended--

(1) by striking subclause (I) and inserting the following new subclause:

‘(I) it determines, based on the notice sent under paragraph (2)(A) of subsection (b), that there is reason to believe that the plan is not sufficient for benefit liabilities,’;

(2) by striking the period at the end of subclause (II) and inserting ‘, or’; and

(3) by adding at the end the following new subclause:

‘(III) it determines that any other requirement of subparagraph (A) or (B) of this paragraph or of subsection (a)(2) has not been met, unless it further determines that the issuance of such notice would be inconsistent with the interests of participants and beneficiaries.’

SEC. 207. PROHIBITION ON BENEFIT INCREASES WHERE PLAN SPONSOR IS IN BANKRUPTCY.

(a) AMENDMENT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974- Section 204 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1054) is amended by redesignating subsections (i) and (j) as subsections (j) and (k), respectively, and by inserting after subsection (h) the following new subsection:

‘(i)(1) In the case of a plan described in paragraph (3) which is maintained by an employer that is a debtor in a case under title 11, United States Code, or similar Federal or State law, no amendment of the plan which increases the liabilities of the plan by reason of--

‘(A) any increase in benefits,

‘(B) any change in the accrual of benefits, or

‘(C) any change in the rate at which benefits become nonforfeitable under the plan,

with respect to employees of the debtor, shall be effective prior to the effective date of such employer’s plan of reorganization.

‘(2) Paragraph (1) shall not apply to any plan amendment that--

‘(A) the Secretary of the Treasury determines to be reasonable and that provides for only de minimis increases in the liabilities of the plan with respect to employees of the debtor,

‘(B) only repeals an amendment described in section 302(c)(8),

‘(C) is required as a condition of qualification under part I of subchapter D, of chapter 1, of the Internal Revenue Code of 1986, or

‘(D) was adopted prior to, or pursuant to a collective bargaining agreement entered into prior to, the date on which the employer became a debtor in a case under title 11, United States Code, or similar Federal or State law.

‘(3) This subsection shall apply only to plans (other than multiemployer plans) covered under section 4021 of this Act for which the funded current liability percentage (within the meaning of section 302(d)(8) of this Act) is less than 100 percent after taking into account the effect of the amendment.

‘(4) For purposes of this subsection, ‘employer’ has the meaning set forth in section 302(c)(11)(A), without regard to section 302(c)(11)(B).’

(b) AMENDMENT TO INTERNAL REVENUE CODE OF 1986- Section 401(a) of the Internal Revenue Code of 1986, as amended by section 121 of this Act, is further amended by adding at the end the following new paragraph:

‘(33) PROHIBITION ON BENEFIT INCREASES WHILE SPONSOR IS IN BANKRUPTCY-

‘(A) IN GENERAL- A trust which is part of a plan to which this paragraph applies shall not constitute a qualified trust under this section if an amendment to such plan is adopted while the employer is a debtor in a case under title 11, United States Code, or similar Federal or State law, if such amendment increases liabilities of the plan by reason of--

‘(i) any increase in benefits,

‘(ii) any change in the accrual of benefits, or

‘(iii) any change in the rate at which benefits become nonforfeitable under the plan,

with respect to employees of the debtor, and such amendment is effective prior to the effective date of such employer’s plan of reorganization.

‘(B) EXCEPTIONS- This paragraph shall not apply to any plan amendment if--

‘(i) the plan, were such amendment to take effect, would have a funded current liability percentage (as defined in section 412(l)(8)) of 100 percent or more,

‘(ii) the Secretary determines that such amendment is reasonable and provides for only de minimis increases in the liabilities of the plan with respect to employees of the debtor,

‘(iii) such amendment only repeals an amendment described in subsection 412(c)(8), or

‘(iv) such amendment is required as a condition of qualification under this part.

‘(C) PLANS TO WHICH THIS PARAGRAPH APPLIES- This paragraph shall apply only to plans (other than multiemployer plans) covered under section 4021 of the Employee Retirement Income Security Act of 1974.

‘(D) EMPLOYER- For purposes of this paragraph, the term ‘employer’ means the employer referred to in section 412(c)(11) (without regard to subparagraph (B) thereof).’

(c) EFFECTIVE DATE OF PLAN AMENDMENT- Section 4022 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1322) is amended by inserting at the end the following new subsection:

‘(f) For purposes of this section, the effective date of a plan amendment described in section 204(i)(1) shall be the effective date of the plan of reorganization of the employer described in section 204(i)(1) or, if later, the effective date stated in such amendment.’.

(d) EFFECTIVE DATE- The amendments made by this section shall apply to plan amendments adopted on or after the date of enactment of this Act.

SEC. 208. SUBSTANTIAL OWNER BENEFITS.

‘(B) For purposes of this title, the term ‘majority owner’ has the same meaning as the term ‘substantial owner’, if ‘50 percent or more’ is substituted for ‘more than 10 percent’ wherever such phrase appears in subparagraph (A) of this paragraph.

‘(C) In the case of a participant who is a majority owner, the amount of benefits guaranteed under this section shall not exceed the lesser of--

‘(i) the amount otherwise determined under this subsection, or

‘(ii) the product of--

‘(I) a fraction (not to exceed 1) the numerator of which is the number of years from the later of the effective date or the adoption date of the plan, and the denominator of which is 30, and

‘(II) the amount of the majority owner’s monthly benefits guaranteed under subsection (a) (as limited by paragraph (3) of this subsection).’

(b) MODIFICATION OF ALLOCATION OF ASSETS-

(1) Section 4044(a)(4)(B) of such Act (29 U.S.C. 1344(a)(4)(B)) is amended by inserting ‘(C)’ after ‘section 4022(b)(5)’.

(2) Section 4044(b) of such Act is amended--

(A) in paragraph (2), by inserting ‘(4),’ before ‘(5)’, and by inserting a comma after ‘(5)’;

(B) by redesignating paragraphs (3) through (6) as paragraphs (4) through (7), respectively; and

‘(3) If assets available for allocation under paragraph (4) of subsection (a) are insufficient to satisfy in full the benefits of all individuals who are described in that paragraph, the assets shall be allocated first to benefits described in subparagraph (A) of that paragraph. Any remaining assets shall then be allocated to subparagraph (B). If assets allocated to subparagraph (B) are insufficient to satisfy in full the benefits in that subparagraph, the assets shall be allocated pro rata among individuals on the basis of the present value (as of the termination date) of their respective benefits described in that subparagraph.’.

SEC. 209. PHASE-OUT OF VARIABLE RATE PREMIUM CAP.

(1) $53, and

(2) the product derived by multiplying--

(A) the excess (if any) of--

(i) the amount determined under clause (i) of section 4006(a)(3)(E) of the Employee Retirement Income Security Act of 1974, over

(ii) $53, by

(B) the applicable percentage.

For purposes of this subsection, the applicable percentage shall be the percentage specified in the following table:

------------------------------------------------------------------------
For the plan year beginning:              The applicable percentage is: 
                 on or after but before                                 
------------------------------------------------------------------------
                July 1, 1994 July 1, 1995 20 percent                    
                July 1, 1995 July 1, 1996 60 percent                    
------------------------------------------------------------------------

TITLE III--PARTICIPANT SERVICES

SEC. 301. DISCLOSURE TO PARTICIPANTS.

‘SEC. 4011. NOTICE TO PARTICIPANTS.

‘(a) IN GENERAL- The plan administrator of a plan subject to the additional premium under section 4006(a)(3)(E) shall provide, in a form and manner and at such time as prescribed in regulations of the corporation, notice to plan participants and beneficiaries and each employee organization representing participants in the plan of the plan’s funding status and the limits on the corporation’s guaranty under section 4022(b) should the plan terminate while underfunded. Such notice shall be written in a manner so as to be understood by the average plan participant.

‘(b) EXCEPTION- Subsection (a) shall not apply to any plan which for the plan year has a funded current liability percentage (as defined in section 302(d)(8) without regard to subparagraph (E) thereof) of at least 90 percent.’

(b) CONFORMING AMENDMENTS-

(1) INFORMATION INCLUDED IN ANNUAL REPORT- Section 103(d)(11) of such Act (29 U.S.C. 1023(d)(11)) is amended to read as follows:

‘(11) In the case of a plan which must notify participants and beneficiaries under section 4011, the funded current liability percentage, as determined for purposes of such section.’

(2) INFORMATION FURNISHED TO PARTICIPANTS- Section 104(b)(3) of such Act (29 U.S.C. 1024(b)(3)) is amended by striking ‘(including the percentage determined under section 103(d)(11))’.

(c) CLERICAL AMENDMENT- The table of contents contained in section 1 of such Act is amended by inserting after the item relating to section 4010 (as added by section 203 of this Act) the following new item:

‘Sec. 4011. Notice to participants.’

(d) EFFECTIVE DATE- The amendment made by this section shall be effective for plan years beginning after the date of enactment of this Act.

SEC. 302. MISSING PARTICIPANTS.

(a) IN GENERAL- Subtitle C of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341 et seq.) (as amended by section 202(a) of this Act) is further amended by adding at the end the following new section:

‘MISSING PARTICIPANTS

‘SEC. 4051. (a) GENERAL RULE-

‘(1) PAYMENT TO THE CORPORATION- A plan administrator satisfies section 4041(b)(3)(A) in the case of a missing participant only if the plan administrator--

‘(A) transfers the participant’s designated benefit to the corporation or purchases an irrevocable commitment from an insurer in accordance with clause (i) of section 4041(b)(3)(A), and

‘(B) provides the corporation such information and certifications with respect to such designated benefits or irrevocable commitments as the corporation shall specify.

‘(2) TREATMENT OF TRANSFERRED ASSETS- A transfer to the corporation under this section shall be treated as a transfer of assets from a terminated plan to the corporation as trustee, and shall be held with assets of terminated plans for which the corporation is trustee under section 4042, subject to the rules set forth in that section.

‘(3) PAYMENT BY THE CORPORATION- After a missing participant whose designated benefit was transferred to the corporation is located--

‘(A) in any case in which the plan could have distributed the benefit of the missing participant in a single sum without participant or spousal consent under section 205(g), the corporation shall pay the participant or beneficiary a single sum benefit equal to the designated benefit paid the corporation plus interest as specified by the corporation, and

‘(B) in any other case, the corporation shall pay a benefit based on the designated benefit and the assumptions prescribed by the corporation at the time that the corporation received the designated benefit.

‘(b) DEFINITIONS- For purposes of this section--

‘(1) MISSING PARTICIPANT- The term ‘missing participant’ means a participant or beneficiary under a terminating plan whom the plan administrator cannot locate after a diligent search.

‘(2) DESIGNATED BENEFIT- The term ‘designated benefit’ means the single sum benefit the participant would receive--

‘(A) under the plan’s assumptions, in the case of a distribution that can be made without participant or spousal consent under section 205(g);

‘(B) under the assumptions of the corporation in effect on the date that the designated benefit is transferred to the corporation, in the case of a plan that does not pay any single sums other than those described in subparagraph (A); or

‘(C) under the assumptions of the corporation or of the plan, whichever provides the higher single sum, in the case of a plan that pays a single sum other than those described in subparagraph (A).

‘(c) REGULATORY AUTHORITY- The corporation shall prescribe such regulations as are necessary to carry out the purposes of this section, including rules relating to what will be considered a diligent search, the amount payable to the corporation, and the amount to be paid by the corporation.’

(b) CONFORMING TITLE IV AMENDMENTS-

(2) AMENDMENT TO SECTION 4005- Section 4005(b)(2)(A) of such Act (29 U.S.C. 1305(b)(2)(A)) is amended by inserting ‘or benefits payable under section 4051’ after ‘section 4022A’.

‘Sec. 4051. Missing participants.’

(2) Section 206 of such Act (29 U.S.C. 1056) (as amended by section 101(a)(9)(B)(i) of this Act) is further amended by adding at the end the following new subsection:

‘(f) MISSING PARTICIPANTS IN TERMINATED PLANS- In the case of a plan covered by title IV, the plan shall provide that, upon termination of the plan, benefits of missing participants shall be treated in accordance with section 4051.’

‘(34) BENEFITS OF MISSING PARTICIPANTS ON PLAN TERMINATION- In the case of a plan covered by title IV of the Employee Retirement Income Security Act of 1974, a trust forming part of such plan shall not be treated as failing to constitute a qualified trust under this section merely because the pension plan of which such trust is a part, upon its termination, transfers benefits of missing participants to the Pension Benefit Guaranty Corporation in accordance with section 4051 of such Act.’

SEC. 303. MODIFICATION OF MAXIMUM GUARANTEE FOR DISABILITY BENEFITS.

(a) IN GENERAL- Section 4022(b)(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1322(b)(3)) is amended by adding at the end the following new sentences: ‘The maximum guaranteed monthly benefit shall not be reduced solely on account of the age of a participant in the case of a benefit payable by reason of disability that occurred on or before the termination date, if the participant demonstrates to the satisfaction of the corporation that the Social Security Administration has determined that the participant satisfies the definition of disability under titles II and XVI of the Social Security Act, and the regulations thereunder. If a benefit payable by reason of disability is converted to an early or normal retirement benefit for reasons other than a change in the health of the participant, such early or normal retirement benefit shall be treated as a continuation of the benefit payable by reason of disability and this subparagraph shall continue to apply.’

TITLE IV--MISCELLANEOUS AMENDMENTS

SEC. 401. ERISA CITATION.

(b) EFFECTIVE DATE- The amendment made by this section shall be effective on the date of enactment of this Act.

SEC. 402. DEFINITION OF CONTRIBUTING SPONSOR.

(b) EFFECTIVE DATE- The amendment made by this section shall be effective as if included in the Pension Protection Act.

SEC. 403. TECHNICAL CORRECTIONS.

(a) PRIOR PLAN TERMINATIONS TAKEN INTO ACCOUNT IN APPLYING RECOVERY RATIO- Section 4022(c)(3)(B)(ii) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1322(c)(3)(B)(ii)) is amended to read as follows:

‘(ii) notices of intent to terminate were provided, or proceedings were instituted under section 4042, after December 17, 1987, and during the first 5 fiscal years of the 7-fiscal-year period ending with the fiscal year preceding the fiscal year for which the recovery ratio is being determined.’

(b) CLARIFICATION UNDER DISTRESS TERMINATION RULES OF DATE FOR DETERMINATIONS RELATING TO SUBSEQUENT INSUFFICIENCY- Section 4022(c) of such Act (29 U.S.C. 1322(c)) is amended by adding at the end the following new subsection:

‘(5) For purposes of this subsection, in the case of a plan described in section 4041(c)(3)(C)(ii), the outstanding amount of benefit liabilities and the value of the recoveries of the corporation under section 4062, 4063, or 4064 in connection with such plan shall be determined as of the date described in section 4062(b)(1)(B).’.

(c) INCLUSION OF TERMINATION PROCEEDINGS INSTITUTED BY CORPORATION IN TRANSITIONAL RULE- Section 9312(b)(3)(B)(i) of the Omnibus Budget Reconciliation Act of 1987 (101 Stat. 1330-363) is amended by inserting after ‘notices of intent to terminate were provided’ the following: ‘, or proceedings were instituted under section 4042 of ERISA,’.

(d) CLARIFICATION OF PERIOD- Section 4044(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1344(c)) is amended in the first sentence--

(1) by striking ‘the later of (1)’;

(2) by striking ‘or (2)’ and inserting ‘and ending on’;

(3) by striking ‘is to be’ and inserting ‘shall be’; and

(4) by striking ‘in any other case’ and inserting ‘(in any other case)’.

(e) EFFECTIVE DATE- The amendments made by this section shall be effective as if included in section 9312 of the Pension Protection Act (101 Stat. 1330-361).

SEC. 404. DISTRESS TERMINATION CRITERIA FOR BANKING INSTITUTIONS.

(a) CLARIFICATION OF DISTRESS CRITERION- Subclause (I) of section 4041(c)(2)(B)(i) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341(c)(2)(B)(i)(I)) is amended by inserting after ‘under any similar’ the following: ‘Federal law or’.

(b) EFFECTIVE DATE- The amendment made by this section shall be effective as if included in the Single Employer Pension Plan Amendments Act of 1986.

SEC. 405. SINGLE SUM DISTRIBUTIONS.

(a) AMENDMENTS TO EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974-

‘(2) For purposes of paragraph (1), the present value shall be calculated in accordance with section 205(g)(3).’

(2) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON CASH-OUTS- Section 205(g)(3) of such Act (29 U.S.C. 1055(g)(3)) is amended to read as follows:

‘(3) Determination of present value-

‘(A) In general-

‘(i) PRESENT VALUE- Except as provided in subparagraph (B), for purposes of paragraphs (1) and (2), the present value shall not be less than the present value calculated by using the applicable mortality table and the applicable interest rate.

‘(ii) DEFINITIONS- For purposes of clause (i)--

‘(I) APPLICABLE MORTALITY TABLE- The term ‘applicable mortality table’ means the table prescribed by the Secretary of the Treasury. Such table shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A) of the Internal Revenue Code of 1986) used to determine reserves for group annuity contracts issued on the date as of which present value is being determined (without regard to any other subparagraph of section 807(d)(5) of such Code).

‘(II) APPLICABLE INTEREST RATE- The term ‘applicable interest rate’ means the annual rate of interest on 30-year Treasury securities for the month before the date of distribution or such other time as the Secretary of the Treasury may by regulations prescribe.

‘(B) EXCEPTION- In the case of a distribution from a plan that was adopted and in effect prior to the date of the enactment of the Retirement Protection Act of 1994, the present value of any distribution made before the earlier of--

‘(i) the later of when a plan amendment applying subparagraph (A) is adopted or made effective, or

‘(ii) the first day of the first plan year beginning after December 31, 1999,

shall be calculated, for purposes of paragraphs (1) and (2), using the interest rates determined under the regulations of the Pension Benefit Guaranty Corporation for determining the present value of a lump sum distribution on plan termination that were in effect on September 1, 1993, and using the provisions of the plan as in effect on the day before the date of the enactment of the Retirement Protection Act of 1994; but only if such provisions of the plan met the requirements of section 205(g)(3) as in effect on the day before such date of enactment.’

(b) AMENDMENTS TO INTERNAL REVENUE CODE OF 1986 RELATING TO MINIMUM BENEFITS-

(1) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON MANDATORY DISTRIBUTIONS- Subparagraph (B) of section 411(a)(11) of the Internal Revenue Code of 1986 is amended to read as follows:

‘(B) DETERMINATION OF PRESENT VALUE- For purposes of subparagraph (A), the present value shall be calculated in accordance with section 417(e)(3).’

(2) DETERMINATION OF PRESENT VALUE FOR PURPOSES OF RESTRICTIONS ON CASH-OUTS- Paragraph (3) of section 417(e) of such Code is amended to read as follows:

‘(3) DETERMINATION OF PRESENT VALUE-

‘(A) IN GENERAL-

‘(i) PRESENT VALUE- Except as provided in subparagraph (B), for purposes of paragraphs (1) and (2), the present value shall not be less than the present value calculated by using the applicable mortality table and the applicable interest rate.

‘(ii) DEFINITIONS- For purposes of clause (i)--

‘(I) APPLICABLE MORTALITY TABLE- The term ‘applicable mortality table’ means the table prescribed by the Secretary. Such table shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A)) used to determine reserves for group annuity contracts issued on the date as of which present value is being determined (without regard to any other subparagraph of section 807(d)(5)).

‘(II) APPLICABLE INTEREST RATE- The term ‘applicable interest rate’ means the annual rate of interest on 30-year Treasury securities for the month before the date of distribution or such other time as the Secretary may by regulations prescribe.

‘(B) EXCEPTION- In the case of a distribution from a plan that was adopted and in effect before the date of the enactment of the Retirement Protection Act of 1994, the present value of any distribution made before the earlier of--

‘(i) the later of the date a plan amendment applying subparagraph (A) is adopted or made effective, or

‘(ii) the first day of the first plan year beginning after December 31, 1999,

shall be calculated, for purposes of paragraphs (1) and (2), using the interest rates determined under the regulations of the Pension Benefit Guaranty Corporation for determining the present value of a lump sum distribution on plan termination that were in effect on September 1, 1993, and using the provisions of the plan as in effect on the day before the date of the enactment of the Retirement Protection Act of 1994; but only if such provisions of the plan met the requirements of section 417(e)(3) as in effect on the day before such date of enactment.’

(c) AMENDMENTS TO INTERNAL REVENUE CODE OF 1986 RELATING TO MAXIMUM BENEFITS- Subparagraph (E) of section 415(b)(2) of such Code is amended--

(1) by redesignating clauses (ii) and (iii) as clauses (iii) and (iv), respectively,

(2) by striking clause (i) and inserting the following new clauses:

‘(i) Except as provided in clause (ii), for purposes of adjusting any benefit or limitation under subparagraph (B) or (C), the interest rate assumption shall not be less than the greater of 5 percent or the rate specified in the plan.

‘(ii) For purposes of adjusting the benefit or limitation of any form of benefit subject to section 417(e)(3), the applicable interest rate (as defined in section 417(e)(3)) shall be substituted for ‘5 percent’ in clause (i).’, and

(3) by adding at the end the following new clause:

‘(v) For purposes of adjusting any benefit or limitation under subparagraph (B), (C), or (D), the mortality table used shall be the table prescribed by the Secretary. Such table shall be based on the prevailing commissioners’ standard table (described in section 807(d)(5)(A)) used to determine reserves for group annuity contracts issued on the date the adjustment is being made (without regard to any other subparagraph of section 807(d)(5)).’

(d) Effective Date-

(3) Section 415-

SEC. 406. ADJUSTMENTS TO LIEN FOR MISSED MINIMUM FUNDING CONTRIBUTIONS.

(a) AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974-

(2) REPEAL OF $1,000,000 OFFSET- Paragraph (3) of section 302(f) of such Act is amended to read as follows:

‘(3) AMOUNT OF LIEN- For purposes of paragraph (1), the amount of the lien shall be equal to the aggregate unpaid balance of required installments and other payments required under this section (including interest)--

‘(A) for plan years beginning after 1987, and

‘(B) for which payment has not been made before the due date.’

(3) REPEAL OF 60-DAY DELAY- Section 302(f)(4)(B) of such Act is amended by striking ‘60th day following the’.

(b) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986-

(2) REPEAL OF $1,000,000 OFFSET- Paragraph (3) of section 412(n) of such Code is amended to read as follows:

‘(3) AMOUNT OF LIEN- For purposes of paragraph (1), the amount of the lien shall be equal to the aggregate unpaid balance of required installments and other payments required under this section (including interest)--

‘(A) for plan years beginning after 1987, and

‘(B) for which payment has not been made before the due date.’

(3) REPEAL OF 60-DAY DELAY- Section 412(n)(4)(B) of such Code is amended by striking ‘60th day following the’.

(c) EFFECTIVE DATE- The amendments made by this section shall be effective for installments and other payments required under section 412 of the Internal Revenue Code of 1986 or under part 3 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 that become due on or after the date of enactment.

SEC. 407. ROUNDING RULES FOR COST-OF-LIVING ADJUSTMENTS.

(a) COST-OF-LIVING ADJUSTMENT FOR COMPENSATION LIMIT- Section 401(a)(17)(B) of the Internal Revenue Code of 1986 is amended to read as follows:

‘(B) COST-OF-LIVING ADJUSTMENT- The Secretary shall adjust annually the $150,000 amount in subparagraph (A) for increases in the cost-of-living at the same time and in the same manner as adjustments under section 415(d); except that the base period shall be the calendar quarter beginning October 1, 1993, and any increase which is not a multiple of $10,000 shall be rounded to the next lowest multiple of $10,000.’

(b) COST-OF-LIVING ADJUSTMENT FOR MAXIMUM DEFINED BENEFIT AMOUNT AND MAXIMUM ANNUAL ADDITION-

(1) IN GENERAL- Section 415(d) of such Code is amended to read as follows:

‘(d) Cost-of-Living Adjustments-

‘(1) IN GENERAL- The Secretary shall adjust annually--

‘(A) the $90,000 amount in subsection (b)(1)(A),

‘(B) in the case of a participant who separated from service, the amount taken into account under subsection (b)(1)(B), and

‘(C) the $30,000 amount in subsection (c)(1)(A),

for increases in the cost-of-living in accordance with regulations prescribed by the Secretary.

‘(2) METHOD- The regulations prescribed under paragraph (1) shall provide for--

‘(A) an adjustment with respect to any calendar year based on the increase in the applicable index for the calendar quarter ending September 30 of the preceding calendar year over such index for the base period, and

‘(B) adjustment procedures which are similar to the procedures used to adjust benefit amounts under section 215(i)(2)(A) of the Social Security Act.

‘(3) BASE PERIOD- For purposes of paragraph (2)--

‘(A) $90,000 AMOUNT- The base period taken into account for purposes of paragraph (1)(A) is the calendar quarter beginning October 1, 1986.

‘(B) SEPARATIONS AFTER DECEMBER 31, 1994- The base period taken into account for purposes of paragraph (1)(B) with respect to individuals separating from service with the employer after December 31, 1994, is the calendar quarter beginning July 1 of the calendar year preceding the calendar year in which such separation occurs.

‘(C) SEPARATIONS BEFORE JANUARY 1, 1995- The base period taken into account for purposes of paragraph (1)(B) with respect to individuals separating from service with the employer before January 1, 1995, is the calendar quarter beginning October 1 of the calendar year preceding the calendar year in which such separation occurs.

‘(D) $30,000 AMOUNT- The base period taken into account for purposes of paragraph (1)(C) is the calendar quarter beginning October 1, 1993.

‘(4) ROUNDING- Any increase under subparagraph (A) or (C) of paragraph (1) which is not a multiple of $5,000 shall be rounded to the next lowest multiple of $5,000.’

(2) CONFORMING AMENDMENT- Section 415(c)(1)(A) of such Code is amended by striking ‘(or, if greater, 1/4 of the dollar limitation in effect under subsection (b)(1)(A))’.

(e) EFFECTIVE DATE- The amendments made by this section shall apply to years beginning after December 31, 1994.

SEC. 408. FUNDING OF RESTORED PLANS.

SEC. 409. STUDY OF FUNDING STATUS OF FEDERAL, STATE, AND LOCAL GOVERNMENT PENSION PLANS.

(b) REPORT- The report of such study shall be submitted not later than one year after the date of the enactment of this Act to the Committee on Education and Labor, the Committee on Post Office and Civil Service, and the Committee on Ways and Means of the House of Representatives and the Committee on Labor and Human Resources, the Committee on Government Affairs, and the Committee on Finance of the Senate.

TITLE V--EFFECTIVE DATES AND RELATED RULES

SEC. 501. EFFECTIVE DATES.

Except as otherwise provided in this Act, the amendments made by this Act shall be effective on the date of enactment of this Act.

SEC. 502. DELAY IN CHANGES TO PREVAILING COMMISSIONERS’ TABLE.

For purposes of sections 205(g)(3) and 302(d)(7)(C) of the Employee Retirement Income Security Act of 1974 and sections 412(l)(7)(C), 415(b), and 417(e)(3) of the Internal Revenue Code of 1986, any change in the prevailing commissioners’ standard table described in section 807(d)(5)(A) of such Code shall be appropriate for pension plans and apply to plan years beginning on or after the later of--

(1) January 1, 2000, or

(2) a date, as prescribed by the Secretary of the Treasury, after the date of the issuance by the Secretary of a revised table based on the prevailing commissioners’ standard table.

Any such revised table shall be issued by regulation. In issuing such regulations, the Secretary shall take into account the results of available independent studies with respect to the appropriate bases for such a table and after opportunity for public comment regarding such studies.

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H.R. 3396 (103rd): Retirement Protection Act of 1994

This bill has 2 versions. Select a version to view: Jul 19, 1994: Introduced Aug 26, 1994: Reported by House Committee

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OCTOBER 28, 1993

July 19, 1994

July 29, 1994

[Strike out all after the enacting clause and insert the part printed in italic]

AUGUST 26, 1994

[Strike out all after the enacting clause and insert the part printed in bold face roman]

[For text of introduced bill, see copy of bill as introduced on October 28, 1993]

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Internal Revenue Code of 1986

Subtitle B--Amendments to the Employee Retirement Income Security Act of 1974

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

TITLE III--PARTICIPANT SERVICES

TITLE IV--MISCELLANEOUS AMENDMENTS

TITLE V--EFFECTIVE DATES

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Internal Revenue Code of 1986

SEC. 101. MINIMUM FUNDING REQUIREMENTS.

SEC. 102. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

SEC. 103. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

SEC. 104. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

SEC. 105. EXCEPTIONS TO EXCISE TAX ON NONDEDUCTIBLE CONTRIBUTIONS.

Subtitle B--Amendments to the Employee Retirement Income Security Act of 1974

SEC. 121. MINIMUM FUNDING REQUIREMENTS.

SEC. 122. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

SEC. 123. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

SEC. 124. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

SEC. 201. REPORTABLE EVENTS.

SEC. 202. ALTERNATIVE TO INVOLUNTARY TERMINATION.

‘SEC. 4050. JUDICIAL RELIEF OTHER THAN INVOLUNTARY TERMINATION.

SEC. 203. CERTAIN INFORMATION REQUIRED TO BE FURNISHED TO PBGC.

‘SEC. 4010. AUTHORITY TO REQUIRE CERTAIN INFORMATION.

SEC. 204. LIABILITY UPON LIQUIDATION OF CONTRIBUTING SPONSOR OR CONTROLLED GROUP MEMBER WHERE PLAN REMAINS ONGOING.

SEC. 205. ENFORCEMENT OF MINIMUM FUNDING REQUIREMENTS.

SEC. 206. REMEDIES FOR NONCOMPLIANCE WITH REQUIREMENTS FOR STANDARD TERMINATION.

SEC. 207. PROHIBITION ON BENEFIT INCREASES WHERE PLAN SPONSOR IS IN BANKRUPTCY.

SEC. 208. SUBSTANTIAL OWNER BENEFITS.

SEC. 209. PHASE-OUT OF VARIABLE RATE PREMIUM CAP.

TITLE III--PARTICIPANT SERVICES

SEC. 301. DISCLOSURE TO PARTICIPANTS.

‘SEC. 4011. NOTICE TO PARTICIPANTS.

SEC. 302. MISSING PARTICIPANTS.

‘SEC. 4051. MISSING PARTICIPANTS.

SEC. 303. MODIFICATION OF MAXIMUM GUARANTEE FOR DISABILITY BENEFITS.

TITLE IV--MISCELLANEOUS AMENDMENTS

SEC. 401. ERISA CITATION.

SEC. 402. DEFINITION OF CONTRIBUTING SPONSOR.

SEC. 403. DISTRESS TERMINATION CRITERIA FOR BANKING INSTITUTIONS.

SEC. 404. SINGLE SUM DISTRIBUTIONS.

SEC. 405. ADJUSTMENTS TO LIEN FOR MISSED MINIMUM FUNDING CONTRIBUTIONS.

SEC. 406. ROUNDING RULES FOR COST-OF-LIVING ADJUSTMENTS.

SEC. 407. FUNDING OF RESTORED PLANS.

SEC. 408. STUDY OF FUNDING STATUS OF FEDERAL, STATE, AND LOCAL GOVERNMENT PENSION PLANS.

TITLE V--EFFECTIVE DATES

SEC. 501. EFFECTIVE DATES.

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Employee Retirement Income Security Act of 1974

Subtitle B--Amendments to the Internal Revenue Code of 1986

TITLE II--AMENDMENTS RELATED TO TITLE IV OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

TITLE III--PARTICIPANT SERVICES

TITLE IV--MISCELLANEOUS AMENDMENTS

TITLE V--EFFECTIVE DATES AND RELATED RULES

TITLE I--PENSION PLAN FUNDING

Subtitle A--Amendments to the Employee Retirement Income Security Act of 1974

SEC. 101. MINIMUM FUNDING REQUIREMENTS.

SEC. 102. LIMITATION ON CHANGES IN CURRENT LIABILITY ASSUMPTIONS.

SEC. 103. ANTICIPATION OF BARGAINED BENEFIT INCREASES.

SEC. 104. MODIFICATION OF QUARTERLY CONTRIBUTION REQUIREMENT.

H.R. 3396 (103^rd): Retirement Protection Act of 1994

This bill has 2 versions. Select a version to view: