skip to main content

H.R. 1916: Save Community Newspaper Act of 2019


The text of the bill below is as of Mar 27, 2019 (Introduced).


I

116th CONGRESS

1st Session

H. R. 1916

IN THE HOUSE OF REPRESENTATIVES

March 27, 2019

(for herself, Mrs. Rodgers of Washington, Mr. Smith of Washington, and Mr. Newhouse) introduced the following bill; which was referred to the Committee on Education and Labor, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To amend the Internal Revenue Code of 1986 and the Employee Retirement Income Security Act of 1974 to provide alternative minimum funding rules for certain single-employer plans maintained by a community newspaper.

1.

Short title

This Act may be cited as the Save Community Newspaper Act of 2019.

2.

Special rules for minimum funding standards for community newspaper plans

(a)

Amendment to Internal Revenue Code of 1986

Section 430 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(m)

Special rules for community newspaper plans

(1)

In general

The plan sponsor of a community newspaper plan under which no participant has had the participant's accrued benefit increased (whether because of service or compensation) after December 31, 2017, may elect to have the alternative standards described in paragraph (3) apply to such plan, and any plan sponsored by any member of the same controlled group, for purposes of this section for plan years beginning with any plan year in effect on or beginning after the date of the enactment of this subsection.

(2)

Election

An election under paragraph (1) shall be made at such time and in such manner as prescribed by the Secretary. Such election, once made with respect to a plan year, shall apply to all subsequent plan years unless revoked with the consent of the Secretary.

(3)

Alternative minimum funding standards

The alternative standards described in this paragraph are the following:

(A)

Interest rates

(i)

In general

Notwithstanding subsection (h)(2)(C) and except as provided in clause (ii), the first, second, and third segment rates in effect for any month for purposes of this section shall be 8 percent.

(ii)

New benefit accruals

Notwithstanding subsection (h)(2), for purposes of determining the funding target and normal cost of a plan for any plan year, the present value of any benefits accrued or earned under the plan for a plan year with respect to which an election under paragraph (1) is in effect shall be determined on the basis of the U.S. Treasury obligation yield curve for the day that is the valuation date of such plan for such plan year.

(iii)

U.S. Treasury obligation yield curve

For purposes of this subsection, the term U.S. Treasury obligation yield curve means, with respect to any day, a yield curve which shall be prescribed by the Secretary for such day on interest-bearing obligations of the United States.

(B)

Shortfall amortization base

(i)

Previous shortfall amortization bases

The shortfall amortization bases determined under subsection (c)(3) for all plan years preceding the first plan year to which the election under paragraph (1) applies (and all shortfall amortization installments determined with respect to such bases) shall be reduced to zero under rules similar to the rules of subsection (c)(6).

(ii)

New shortfall amortization base

Notwithstanding subsection (c)(3), the shortfall amortization base for the first plan year to which the election under paragraph (1) applies shall be the funding shortfall of such plan for such plan year (determined using the interest rates as modified under subparagraph (A)).

(C)

Determination of shortfall amortization installments

(i)

30-year period

Subparagraphs (A) and (B) of subsection (c)(2) shall be applied by substituting 30-plan-year for 7-plan-year each place it appears.

(ii)

No special election

The election under subparagraph (D) of subsection (c)(2) shall not apply to any plan year to which the election under paragraph (1) applies.

(D)

Exemption from at-risk treatment

Subsection (i) shall not apply.

(4)

Community newspaper plan

For purposes of this subsection:

(A)

In general

The term community newspaper plan means a plan to which this section applies maintained by an employer which, as of December 31, 2017—

(i)

publishes and distributes, either electronically or in printed form, 1 or more newspapers,

(ii)

is not a company the stock of which is publicly traded (on a stock exchange or in an over-the-counter market), and is not controlled, directly or indirectly, by such a company, and

(iii)

is controlled, directly or indirectly—

(I)

by 1 or more persons residing primarily in a State in which the newspaper is published or distributed,

(II)

by a trust or trusts, 1 or more of which was created or organized in a State in which the newspaper is published or distributed, or

(III)

by a combination of persons described in subclauses (I) and (II).

(B)

Control

A person shall be treated as controlled by another person if such other person possesses, directly or indirectly, the power to direct or cause the direction and management of such person (including the power to elect a majority of the members of the board of directors of such person) through the ownership of voting securities.

(5)

Controlled group

For purposes of this subsection, the term controlled group means all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 as of the date of the enactment of this subsection.

.

(b)

Amendment to Employee Retirement Income Security Act of 1974

Section 303 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1083) is amended by adding at the end the following new subsection:

(m)

Special rules for community newspaper plans

(1)

In general

The plan sponsor of a community newspaper plan under which no participant has had the participant's accrued benefit increased (whether because of service or compensation) after December 31, 2017, may elect to have the alternative standards described in paragraph (3) apply to such plan, and any plan sponsored by any member of the same controlled group, for purposes of this section for plan years beginning with any plan year in effect on or beginning after the date of the enactment of this subsection.

(2)

Election

An election under paragraph (1) shall be made at such time and in such manner as prescribed by the Secretary of the Treasury. Such election, once made with respect to a plan year, shall apply to all subsequent plan years unless revoked with the consent of the Secretary of the Treasury.

(3)

Alternative minimum funding standards

The alternative standards described in this paragraph are the following:

(A)

Interest rates

(i)

In general

Notwithstanding subsection (h)(2)(C) and except as provided in clause (ii), the first, second, and third segment rates in effect for any month for purposes of this section shall be 8 percent.

(ii)

New benefit accruals

Notwithstanding subsection (h)(2), for purposes of determining the funding target and normal cost of a plan for any plan year, the present value of any benefits accrued or earned under the plan for a plan year with respect to which an election under paragraph (1) is in effect shall be determined on the basis of the U.S. Treasury obligation yield curve for the day that is the valuation date of such plan for such plan year.

(iii)

U.S. Treasury obligation yield curve

For purposes of this subsection, the term U.S. Treasury obligation yield curve means, with respect to any day, a yield curve which shall be prescribed by the Secretary of the Treasury for such day on interest-bearing obligations of the United States.

(B)

Shortfall amortization base

(i)

Previous shortfall amortization bases

The shortfall amortization bases determined under subsection (c)(3) for all plan years preceding the first plan year to which the election under paragraph (1) applies (and all shortfall amortization installments determined with respect to such bases) shall be reduced to zero under rules similar to the rules of subsection (c)(6).

(ii)

New shortfall amortization base

Notwithstanding subsection (c)(3), the shortfall amortization base for the first plan year to which the election under paragraph (1) applies shall be the funding shortfall of such plan for such plan year (determined using the interest rates as modified under subparagraph (A)).

(C)

Determination of shortfall amortization installments

(i)

30-year period

Subparagraphs (A) and (B) of subsection (c)(2) shall be applied by substituting 30-plan-year for 7-plan-year each place it appears.

(ii)

No special election

The election under subparagraph (D) of subsection (c)(2) shall not apply to any plan year to which the election under paragraph (1) applies.

(D)

Exemption from at-risk treatment

Subsection (i) shall not apply.

(4)

Community newspaper plan

For purposes of this subsection:

(A)

In general

The term community newspaper plan means a plan to which this section applies maintained by an employer which, as of December 31, 2017—

(i)

publishes and distributes, either electronically or in printed form, 1 or more newspapers,

(ii)

is not a company the stock of which is publicly traded (on a stock exchange or in an over-the-counter market), and is not controlled, directly or indirectly, by such a company, and

(iii)

is controlled, directly or indirectly—

(I)

by 1 or more persons residing primarily in a State in which the newspaper is published or distributed,

(II)

by a trust or trusts, 1 or more of which was created or organized in a State in which the newspaper is published or distributed, or

(III)

by a combination of persons described in subclauses (I) and (II).

(B)

Control

A person shall be treated as controlled by another person if such other person possesses, directly or indirectly, the power to direct or cause the direction and management of such person (including the power to elect a majority of the members of the board of directors of such person) through the ownership of voting securities.

(5)

Controlled group

For purposes of this subsection, the term controlled group means all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 of the Internal Revenue Code of 1986 as of the date of the enactment of this subsection.

(6)

Effect on premium rate calculation

Notwithstanding any other provision of law or any regulation issued by the Pension Benefit Guaranty Corporation, in the case of a plan with respect to which the election under paragraph (1) has been made, the additional premium under section 4006(a)(3)(E) shall be determined as if such election had not been made.

.

(c)

Effective date

The amendments made by this section shall apply to plan years ending after December 31, 2017.