[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4824 Introduced in House (IH)]







105th CONGRESS
  2d Session
                                H. R. 4824

To amend title II of the Social Security Act to provide for individual 
   security accounts funded by employee and employer social security 
 payroll deductions, to extend the solvency of the old-age, survivors, 
       and disability insurance program, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 13, 1998

Mr. Kolbe (for himself and Mr. Stenholm) introduced the following bill; 
which was referred to the Committee on Ways and Means, and in addition 
 to the Committee on Rules, 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 title II of the Social Security Act to provide for individual 
   security accounts funded by employee and employer social security 
 payroll deductions, to extend the solvency of the old-age, survivors, 
       and disability insurance program, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``21st Century 
Retirement Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Individual security accounts.
Sec. 3. Minimum social security benefit.
Sec. 4. Elimination of earnings test for individuals who have attained 
                            retirement age.
Sec. 5. Reduction in the amount of certain transfers to Medicare Trust 
                            Fund.
Sec. 6. Coverage of newly hired State and local employees.
Sec. 7. Gradual increase in number of benefit computation years; use of 
                            all years in computation.
Sec. 8. Actuarial adjustment for retirement.
Sec. 9. Improvements in process for cost-of-living adjustments.
Sec. 10. Phased reduction in spousal benefits other than survivor's 
                            benefits to 33 percent of primary insurance 
                            amount.
Sec. 11. Adjustment to upper 2 benefit formula factors.
Sec. 12. Phased-in increase in social security retirement ages.
Sec. 13. Mechanism for remedying unforeseen deterioration in social 
                            security solvency.

SEC. 2. INDIVIDUAL SECURITY ACCOUNTS.

    (a) Establishment and Maintenance of Individual Security 
Accounts.--Title II of the Social Security Act (42 U.S.C. 401 et seq.) 
is amended--
            (1) by inserting before section 201 the following:

                    ``Part A--Insurance Benefits'';

        and
            (2) by adding at the end the following:

                 ``Part B--Individual Security Accounts

                     ``individual security accounts

    ``Sec. 251. (a) Establishment.--
            ``(1) In general.--The Commissioner of Social Security, 
        within 30 days of the receipt of the first contribution 
        received pursuant to subsection (b) with respect to an eligible 
        individual, shall establish in the name of such individual an 
        individual security account. The individual security account 
        shall be identified to the account holder by means of the 
        account holder's Social Security account number.
            ``(2) Definition of eligible individual.--In this part, the 
        term `eligible individual' means any individual born after 
        December 31, 1944.
    ``(b) Contributions.--The Secretary of the Treasury shall transfer 
from the Federal Old-Age and Survivors Insurance Trust Fund, for 
crediting by the Commissioner of Social Security to an individual 
security account of an eligible individual, an amount equal to the sum 
of any amount received by such Secretary on behalf of such individual 
under section 3101(a)(2) or 1401(a)(2) of the Internal Revenue Code of 
1986.
    ``(c) Designation of Investment Type of Individual Security 
Account.--
            ``(1) Designation.--Each eligible individual who is 
        employed or self-employed shall designate the investment type 
        of individual security account to which the contributions 
        described in subsection (b) on behalf of such individual are to 
        be credited.
            ``(2) Form of designation.--The designation described in 
        paragraph (1) shall be made in such manner and at such 
        intervals as the Commissioner of Social Security may prescribe 
        in order to ensure ease of administration and reductions in 
        burdens on employers.
            ``(3) Special rule for 2000.--Not later than January 1, 
        2000, any eligible individual that is employed or self-employed 
        as of such date shall execute the designation required under 
        paragraph (1).
            ``(4) Designation in absence of designation by eligible 
        individual.--In any case in which no designation of the 
        individual security account is made, the Commissioner of Social 
        Security shall make the designation of the individual security 
        account in accordance with regulations that take into account 
        the competing objectives of maximizing returns on investments 
        and minimizing the risk involved with such investments.

   ``definition of individual security account; treatment of accounts

    ``Sec. 252. (a) Individual Security Account.--In this part, the 
term `individual security account' means any individual security 
account in the Individual Security Fund (established under section 254) 
which is administered by the Individual Security Fund Board.
    ``(b) Treatment of Account.--Except as otherwise provided in this 
part, any individual security account described in paragraph (1)(A) 
shall be treated in the same manner as an individual account in the 
Thrift Savings Fund under subchapter III of chapter 84 of title 5, 
United States Code.

              ``individual security account distributions

    ``Sec. 253. (a) Date of Initial Distribution.--Except as provided 
in subsection (c), distributions may only be made from an individual 
security account of an eligible individual on and after the earliest 
of--
            ``(1) the date the eligible individual attains normal 
        retirement age, as determined under section 216 (or early 
        retirement age (as so determined) if elected by such 
        individual), or
            ``(2) the date on which funds in the eligible individual's 
        individual security account are sufficient to provide a monthly 
        payment over the life expectancy of the eligible individual 
        (determined under reasonable actuarial assumptions) which, when 
        added to the eligible individual's monthly benefit under part A 
        (if any), is at least equal to an amount equal to \1/12\ of the 
        poverty line (as defined in section 673(2) of the Community 
        Services Block Grant Act (42 U.S.C. 9902(2) and determined on 
        such date for a family of the size involved) and adjusted 
        annually thereafter by the adjustment determined under section 
        215(i).
    ``(b) Forms of Distribution.--
            ``(1) Required monthly payments.--Except as provided in 
        paragraph (2), beginning with the date determined under 
        subsection (a), the balance in an individual security account 
        available to provide monthly payments not in excess of the 
        amount described in subsection (a)(2) shall be paid, as elected 
        by the account holder (in such form and manner as shall be 
        prescribed in regulations of the Individual Security Fund 
        Board), by means of the purchase of annuities or equal monthly 
        payments over the life expectancy of the eligible individual 
        (determined under reasonable actuarial assumptions) in 
        accordance with requirements (which shall be provided in 
        regulations of the Board) similar to the requirements 
        applicable to payments of benefits under subchapter III of 
        chapter 84 of title 5, United States Code, and providing for 
        indexing for inflation.
            ``(2) Payment of excess funds.--To the extent funds remain 
        in an eligible individual's individual security account after 
        the application of paragraph (1), such funds shall be payable 
        to the eligible individual in such manner and in such amounts 
        as determined by the eligible individual, subject to the 
        provisions of subchapter III of chapter 84 of title 5, United 
        States Code.
    ``(c) Distribution in the Event of Death Before the Date of Initial 
Distribution.--If the eligible individual dies before the date 
determined under subsection (a), the balance in such individual's 
individual security account shall be distributed in a lump sum, under 
rules established by the Individual Security Fund Board, to the 
employee's heirs.

                       ``individual security fund

    ``Sec. 254. (a) Establishment.--There is established and maintained 
in the Treasury of the United States an Individual Security Fund in the 
same manner as the Thrift Savings Fund under sections 8437, 8438, and 
8439 (but not section 8440) of title 5, United States Code.
    ``(b) Individual Security Fund Board.--
            ``(1) In general.--There is established and operated in the 
        Social Security Administration an Individual Security Fund 
        Board in the same manner as the Federal Retirement Thrift 
        Investment Board under subchapter VII of chapter 84 of title 5, 
        United States Code.
            ``(2) Specific investment and reporting duties.--
                    ``(A) In general.--The Individual Security Fund 
                Board shall manage and report on the activities of the 
                Individual Security Fund and the individual security 
                accounts of such Fund in the same manner as the Federal 
                Retirement Thrift Investment Board manages and reports 
                on the Thrift Savings Fund and the individual accounts 
                of such Fund under subchapter VII of chapter 84 of 
                title 5, United States Code.
                    ``(B) Study and report on increased investment 
                options.--
                            ``(i) Study.--The Individual Security Fund 
                        Board shall conduct a study regarding ways to 
                        increase an eligible individual's investment 
                        options with respect to such individual's 
                        individual security account and with respect to 
                        rollovers or distributions from such account.
                            ``(ii) Report.--Not later than 2 years 
                        after the date of enactment of the 
                        Strengthening Social Security Act of 1998, the 
                        Individual Security Fund Board shall submit a 
                        report to the President and Congress that 
                        contains a detailed statement of the results of 
                        the study conducted pursuant to clause (i), 
                        together with the Board's recommendations for 
                        such legislative actions as the Board considers 
                        appropriate.

     ``budgetary treatment of individual security fund and accounts

    ``Sec. 255. The receipts and disbursements of the Individual 
Security Fund and any accounts within such fund shall not be included 
in the totals of the budget of the United States Government as 
submitted by the President or of the congressional budget and shall be 
exempt from any general budget limitation imposed by statute on 
expenditures and net lending (budget outlays) of the United States 
Government.''.
    (b) Modification of FICA Rates.--
            (1) Employees.--Section 3101(a) of the Internal Revenue 
        Code of 1986 (relating to tax on employees) is amended to read 
        as follows:
    ``(a) Old-Age, Survivors, and Disability Insurance.--
            ``(1) In general.--
                    ``(A) Individuals covered under part a of title ii 
                of the social security act.--In addition to other 
                taxes, there is hereby imposed on the income of every 
                individual who is not a part B eligible individual a 
                tax equal to 6.2 percent of the wages (as defined in 
section 3121(a)) received by him with respect to employment (as defined 
in section 3121(b)).
                    ``(B) Individuals covered under part b of title ii 
                of the social security act.--In addition to other 
                taxes, there is hereby imposed on the income of every 
                part B eligible individual a tax equal to 4.2 percent 
                of the wages (as defined in section 3121(a)) received 
                by such individual with respect to employment (as 
                defined in section 3121(b)).
            ``(2) Contribution of oasdi tax reduction to individual 
        security accounts.--
                    ``(A) In general.--In addition to other taxes, 
                there is hereby imposed on the income of every part B 
                eligible individual an individual security account 
                contribution equal to the sum of--
                            ``(i) 2 percent of the wages (as so 
                        defined) received by such individual with 
                        respect to employment (as so defined), plus
                            ``(ii) so much of such wages (not to exceed 
                        $2,000) as designated by the individual in the 
                        same manner as described in section 251(c) of 
                        the Social Security Act.
                    ``(B) Inflation adjustment.--
                            ``(i) In general.--In the case of any 
                        calendar year beginning after 2000, the dollar 
                        amount in subparagraph (A)(ii) shall be 
                        increased by an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied by
                                    ``(II) the cost-of-living 
                                adjustment determined under section 
                                1(f)(3) for the calendar year, 
                                determined by substituting `calendar 
                                year 1999' for `calendar year 1992' in 
                                subparagraph (B) thereof.
                            ``(ii) Rounding.--If any dollar amount 
                        after being increased under clause (i) is not a 
                        multiple of $10, such dollar amount shall be 
                        rounded to the nearest multiple of $10.''.
            (2) Self-employed.--Section 1401(a) of the Internal Revenue 
        Code of 1986 (relating to tax on self-employment income) is 
        amended to read as follows:
    ``(a) Old-Age, Survivors, and Disability Insurance.--
            ``(1) In general.--
                    ``(A) Individuals covered under part a of the 
                social security act.--In addition to other taxes, there 
                shall be imposed for each taxable year, on the self-
                employment income of every individual who is not a part 
                B eligible individual for the calendar year ending with 
                or during such taxable year, a tax equal to 12.40 
                percent of the amount of the self-employment income for 
                such taxable year.
                    ``(B) Individuals covered under part b of title ii 
                of the social security act.--In addition to other 
                taxes, there is hereby imposed for each taxable year, 
                on the self-employment income of every part B eligible 
                individual, a tax equal to 10.4 percent of the amount 
                of the self-employment income for such taxable year.
            ``(2) Contribution of oasdi tax reduction to individual 
        security accounts.--
                    ``(A) In general.--In addition to other taxes, 
                there is hereby imposed for each taxable year, on the 
                self-employment income of every individual, an 
                individual security account contribution equal to the 
                sum of--
                            ``(i) 2 percent of the amount of the self-
                        employment income for each individual for such 
                        taxable year; and
                            ``(ii) so much of such self-employment 
                        income (not to exceed $2,000) as designated by 
                        the individual in the same manner as described 
                        in section 251(c) of the Social Security Act.
                    ``(B) Inflation adjustment.--
                            ``(i) In general.--In the case of any 
                        taxable year beginning after 2000, the dollar 
                        amount in subparagraph (A)(ii) shall be 
                        increased by an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied by
                                    ``(II) the cost-of-living 
                                adjustment determined under section 
                                1(f)(3) for the calendar year in which 
                                the taxable year begins, determined by 
                                substituting `calendar year 1999' for 
                                `calendar year 1992' in subparagraph 
                                (B) thereof.
                            ``(ii) Rounding.--If any dollar amount 
                        after being increased under clause (i) is not a 
                        multiple of $10, such dollar amount shall be 
                        rounded to the nearest multiple of $10.''.
            (3) Part b eligible individual.--
                    (A) Taxes on employees.--Section 3121 of such Code 
                (relating to definitions) is amended by inserting after 
                subsection (s) the following new subsection:
    ``(t) Part B Eligible Individual.--For purposes of this chapter, 
the term `part B eligible individual' means, for any calendar year, an 
individual who is an eligible individual (as defined in section 
251(a)(2) of the Social Security Act) for such calendar year.''.
                    (B) Self-employment tax.--Section 1402 of such Code 
                (relating to definitions) is amended by adding at the 
                end the following new subsection:
    ``(k) Part B Eligible Individual.--The term `part B eligible 
individual' means, for any calendar year, an individual who is an 
eligible individual (as defined in section 251(a)(2) of the Social 
Security Act) for such calendar year.''.
            (4) Effective dates.--
                    (A) Employees.--The amendments made by paragraphs 
                (1) and (3)(A) apply to remuneration paid after 
                December 31, 1999.
                    (B) Self-employed individuals.--The amendments made 
                by paragraphs (2) and (3)(B) apply to taxable years 
                beginning after December 31, 1999.

SEC. 3. MINIMUM SOCIAL SECURITY BENEFIT.

    Section 215 of the Social Security Act (42 U.S.C. 415) is amended 
by adding at the end the following:

                  ``Minimum Monthly Insurance Benefit

    ``(j)(1) Notwithstanding the preceding provisions of this section--
            ``(A) the primary insurance amount of a qualified 
        individual shall be equal to the greater of--
                    ``(i) the primary insurance amount determined under 
                this section (without regard to this subsection), or
                    ``(ii) \1/12\ of the applicable percentage of the 
                applicable amount, and
            ``(B) any recomputation of the primary insurance amount of 
        a qualified individual shall not result in a primary insurance 
        amount less than the primary insurance amount as in effect 
        immediately prior to such recomputation.
    ``(2) For purposes of this subsection--
            ``(A) The term `qualified individual' means an individual--
                    ``(i) who initially becomes eligible for old-age or 
                disability insurance benefits, or dies (before becoming 
                eligible for such benefits) for a month beginning after 
                December 31, 2005, and
                    ``(ii) who has at least twice the minimum number of 
                quarters required to be fully insured.
            ``(B) The term `applicable amount' means, in connection 
        with an individual, $7,992 adjusted annually--
                    ``(i)(I) with respect to an individual whose 
                initial month of eligibility occurs in a year prior to 
                2011, by the CPI increase percentage determined under 
                section 215(i) for 1996 through the year prior to such 
                year of eligibility; and
                    ``(II) with respect to an individual whose initial 
                month of eligibility occurs in a year after 2010, by 
                the CPI increase percentage determined under such 
                section for 1996 through 2009, and by the wage increase 
                percentage determined under such section for 2009 
                through the second year prior to the year of such 
                eligibility; and
                    ``(ii) by the CPI increase percentage determined 
                under such section for all years beginning with the 
                year of an individual's initial eligibility.
            ``(C)(i) The term `applicable percentage' means, for 
        computations and recomputations of a qualified individual's 
        primary insurance amount under this section whose initial 
        eligibility occurs in any calendar year specified in the table 
        under clause (ii), the sum of--
                    ``(I) the applicable base percentage specified in 
                such table in connection with such year, plus
                    ``(II) the product derived by multiplying the 
                applicable percentage increment specified in such table 
                in connection with such year by the ratio of the number 
                of such individual's quarters of coverage (if any) in 
                excess of the minimum number of quarters required to be 
                fully insured but not in excess of twice such minimum, 
                to such minimum.
            ``(ii) For purposes of clause (i), the applicable base 
        percentages and applicable percentage increments are set forth 
        in connection with calendar years in the following table:


``If the calendar year is:             The applicable base      And the applicable percentage increment is:
                                        percentage is:
2006.................................  12 percent.............                      8 percent
2007.................................  24 percent.............                     16 percent
2008.................................  36 percent.............                     24 percent
2009.................................  48 percent.............                     32 percent
After 2009...........................  60 percent.............                    40 percent.''

SEC. 4. ELIMINATION OF EARNINGS TEST FOR INDIVIDUALS WHO HAVE ATTAINED 
              RETIREMENT AGE.

    (a) In General.--Section 203 of the Social Security Act (42 U.S.C. 
403) is amended--
            (1) in subsection (c)(1), by striking ``the age of 
        seventy'' and inserting ``retirement age (as defined in section 
        216(l))'';
            (2) in paragraphs (1)(A) and (2) of subsection (d), by 
        striking ``the age of seventy'' each place it appears and 
        inserting ``retirement age (as defined in section 216(l))'';
            (3) in subsection (f)(1)(B), by striking ``was age seventy 
        or over'' and inserting ``was at or above retirement age (as 
        defined in section 216(l))'';
            (4) in subsection (f)(3)--
                    (A) by striking ``33\1/3\ percent'' and all that 
                follows through ``any other individual,'' and inserting 
                ``50 percent of such individual's earnings for such 
                year in excess of the product of the exempt amount as 
                determined under paragraph (8),''; and
                    (B) by striking ``age 70'' and inserting 
                ``retirement age (as defined in section 216(l))'';
            (5) in subsection (h)(1)(A), by striking ``age 70'' each 
        place it appears and inserting ``retirement age (as defined in 
        section 216(l))''; and
            (6) in subsection (j)--
                    (A) in the heading, by striking ``Age Seventy'' and 
                inserting ``Retirement Age''; and
                    (B) by striking ``seventy years of age'' and 
                inserting ``having attained retirement age (as defined 
                in section 216(l))''.
    (b) Conforming Amendments Eliminating the Special Exempt Amount for 
Individuals Who Have Attained Retirement Age.--
            (1) Uniform exempt amount.--Section 203(f)(8)(A) of the 
        Social Security Act (42 U.S.C. 403(f)(8)(A)) is amended by 
        striking ``the new exempt amounts (separately stated for 
        individuals described in subparagraph (D) and for other 
        individuals) which are to be applicable'' and inserting ``a new 
        exempt amount which shall be applicable''.
            (2) Conforming amendments.--Section 203(f)(8)(B) of such 
        Act (42 U.S.C. 403(f)(8)(B)) is amended--
                    (A) in the matter preceding clause (i), by striking 
                ``Except'' and all that follows through ``whichever'' 
                and inserting ``The exempt amount which is applicable 
                for each month of a particular taxable year shall be 
                whichever'';
                    (B) in clauses (i) and (ii), by striking 
                ``corresponding'' each place it appears; and
                    (C) in the last sentence, by striking ``an exempt 
                amount'' and inserting ``the exempt amount''.
            (3) Repeal of basis for computation of special exempt 
        amount.--Section 203(f)(8)(D) of such Act (42 U.S.C. 
        403(f)(8)(D)) is repealed.
    (c) Additional Conforming Amendments.--
            (1) Elimination of redundant references to retirement 
        age.--Section 203 of the Social Security Act (42 U.S.C. 403) is 
        amended--
                    (A) in subsection (c), in the last sentence, by 
                striking ``nor shall any deduction'' and all that 
                follows and inserting ``nor shall any deduction be made 
                under this subsection from any widow's or widower's 
                insurance benefit if the widow, surviving divorced 
                wife, widower, or surviving divorced husband involved 
                became entitled to such benefit prior to attaining age 
                60.''; and
                    (B) in subsection (f)(1), by striking subparagraph 
                (D) and inserting the following: ``(D) for which such 
                individual is entitled to widow's or widower's 
                insurance benefits if such individual became so 
                entitled prior to attaining age 60,''.
            (2) Conforming amendment to provisions for determining 
        amount of increase on account of delayed retirement.--Section 
        202(w)(2)(B)(ii) of such Act (42 U.S.C. 402(w)(2)(B)(ii)) is 
        amended--
                    (A) by striking ``either''; and
                    (B) by striking ``or suffered deductions under 
                section 203(b) or 203(c) in amounts equal to the amount 
                of such benefit''.
            (3) Provisions relating to earnings taken into account in 
        determining substantial gainful activity of blind 
        individuals.--The second sentence of section 223(d)(4) of such 
        Act (42 U.S.C. 423(d)(4)) is amended by striking ``if section 
        102 of the Senior Citizens' Right to Work Act of 1996 had not 
        been enacted'' and inserting the following: ``if the amendments 
        to section 203 made by section 102 of the Senior Citizens' 
        Right to Work Act of 1996 and by the Strengthening Social 
        Security Act of 1998 had not been enacted''.
    (d) Effective Date.--The amendments and repeals made by this 
section shall apply with respect to taxable years ending after December 
31, 1999.

SEC. 5. REDUCTION IN THE AMOUNT OF CERTAIN TRANSFERS TO MEDICARE TRUST 
              FUND.

    Subparagraph (A) of section 121(e)(1) of the Social Security 
Amendments of 1983 (42 U.S.C. 401 note), as amended by section 
13215(c)(1) of the Omnibus Budget Reconciliation Act of 1993, is 
amended--
            (1) in clause (ii), by striking ``the amounts'' and 
        inserting ``the applicable percentage of the amounts''; and
            (2) by adding at the end the following: ``For purposes of 
        clause (ii), the applicable percentage for a year is equal to 
        100 percent, reduced (but not below zero) by 10 percentage 
        points for each year after 2009.''.

SEC. 6. COVERAGE OF NEWLY HIRED STATE AND LOCAL EMPLOYEES.

    (a) Amendments to the Social Security Act.--
            (1) In general.--Paragraph (7) of section 210(a) of the 
        Social Security Act (42 U.S.C. 410(a)(7)) is amended to read as 
        follows:
            ``(7) Excluded State or local government employment (as 
        defined in subsection (s));''.
            (2) Excluded state or local government employment.--
                    (A) In general.--Section 210 of such Act (42 U.S.C. 
                410) is amended by adding at the end the following:

            ``Excluded State or Local Government Employment

    ``(s)(1) In General.--The term `excluded State or local government 
employment' means any service performed in the employ of a State, of 
any political subdivision thereof, or of any instrumentality of any 1 
or more of the foregoing which is wholly owned thereby, if--
            ``(A)(i) such service would be excluded from the term 
        `employment' for purposes of this title if the preceding 
        provisions of this section as in effect on December 31, 1999, 
        had remained in effect, and (ii) the requirements of paragraph 
        (2) are met with respect to such service, or
            ``(B) the requirements of paragraph (3) are met with 
        respect to such service.
    ``(2) Exception for Current Employment Which Continues.--
            ``(A) In general.--The requirements of this paragraph are 
        met with respect to service for any employer if--
                    ``(i) such service is performed by an individual--
                            ``(I) who was performing substantial and 
                        regular service for remuneration for that 
                        employer before January 1, 2000,
                            ``(II) who is a bona fide employee of that 
                        employer on December 31, 1999, and
                            ``(III) whose employment relationship with 
                        that employer was not entered into for purposes 
                        of meeting the requirements of this 
                        subparagraph, and
                    ``(ii) the employment relationship with that 
                employer has not been terminated after December 31, 
                1999.
            ``(B) Treatment of multiple agencies and 
        instrumentalities.--For purposes of subparagraph (A), under 
        regulations (consistent with regulations established under 
        section 3121(t)(2)(B) of the Internal Revenue Code of 1986)--
                    ``(i) all agencies and instrumentalities of a State 
                (as defined in section 218(b)) or of the District of 
                Columbia shall be treated as a single employer, and
                    ``(ii) all agencies and instrumentalities of a 
                political subdivision of a State (as so defined) shall 
                be treated as a single employer and shall not be 
                treated as described in clause (i).
    ``(3) Exception for certain services.--
            ``(A) In general.--The requirements of this paragraph are 
        met with respect to service if such service is performed--
                    ``(i) by an individual who is employed by a State 
                or political subdivision thereof to relieve such 
                individual from unemployment,
                    ``(ii) in a hospital, home, or other institution by 
                a patient or inmate thereof as an employee of a State 
                or political subdivision thereof or of the District of 
                Columbia,
                    ``(iii) by an individual, as an employee of a State 
                or political subdivision thereof or of the District of 
                Columbia, serving on a temporary basis in case of fire, 
                storm, snow, earthquake, flood, or other similar 
                emergency,
                    ``(iv) by any individual as an employee included 
                under section 5351(2) of title 5, United States Code 
                (relating to certain interns, student nurses, and other 
                student employees of hospitals of the District of 
                Columbia Government), other than as a medical or dental 
                intern or a medical or dental resident in training,
                    ``(v) by an election official or election worker if 
                the remuneration paid in a calendar year for such 
                service is less than $1,000 with respect to service 
                performed during 2000, and the adjusted amount 
                determined under subparagraph (C) for any subsequent 
                year with respect to service performed during such 
                subsequent year, except to the extent that service by 
                such election official or election worker is included 
                in employment under an agreement under section 218, or
                    ``(vi) by an employee in a position compensated 
                solely on a fee basis which is treated pursuant to 
                section 211(c)(2)(E) as a trade or business for 
                purposes of inclusion of such fees in net earnings from 
                self-employment.
            ``(B) Definitions.--As used in this paragraph, the terms 
        `State' and `political subdivision' have the meanings given 
        those terms in section 218(b).
            ``(C) Adjustments to dollar amount for election officials 
        and election workers.--For each year after 2000, the Secretary 
        shall adjust the amount referred to in subparagraph (A)(v) at 
        the same time and in the same manner as is provided under 
        section 215(a)(1)(B)(ii) with respect to the amounts referred 
        to in section 215(a)(1)(B)(i), except that--
                    ``(i) for purposes of this subparagraph, 1997 shall 
                be substituted for the calendar year referred to in 
                section 215(a)(1)(B)(ii)(II), and
                    ``(ii) such amount as so adjusted, if not a 
                multiple of $50, shall be rounded to the nearest 
                multiple of $50.
        The Commissioner of Social Security shall determine and publish 
        in the Federal Register each adjusted amount determined under 
        this subparagraph not later than November 1 preceding the year 
        for which the adjustment is made.''.
                    (B) Conforming amendments.--
                            (i) Subsection (k) of section 210 of such 
                        Act (42 U.S.C. 410(k)) (relating to covered 
                        transportation service) is repealed.
                            (ii) Section 210(p) of such Act (42 U.S.C. 
                        410(p)) is amended--
                                    (I) in paragraph (2), by striking 
                                ``service is performed'' and all that 
                                follows and inserting ``service is 
                                service described in subsection 
                                (s)(3)(A).''; and
                                    (II) in paragraph (3)(A), by 
                                inserting ``under subsection (a)(7) as 
                                in effect on December 31, 1999'' after 
                                ``section''.
                            (iii) Section 218(c)(6) of such Act (42 
                        U.S.C. 418(c)(6)) is amended--
                                    (I) by striking subparagraph (C);
                                    (II) by redesignating subparagraphs 
                                (D) and (E) as subparagraphs (C) and 
                                (D), respectively; and
                                    (III) by striking subparagraph (F) 
                                and inserting the following:
            ``(E) service which is included as employment under section 
        210(a).''.
    (b) Amendments to the Internal Revenue Code of 1986.--
            (1) In general.--Paragraph (7) of section 3121(b) of the 
        Internal Revenue Code of 1986 (relating to employment) is 
        amended to read as follows:
            ``(7) excluded State or local government employment (as 
        defined in subsection (t));''.
            (2) Excluded state or local government employment.--Section 
        3121 of such Code is amended by inserting after subsection (s) 
        the following:
    ``(t) Excluded State or Local Government Employment.--
            ``(1) In general.--For purposes of this chapter, the term 
        `excluded State or local government employment' means any 
        service performed in the employ of a State, of any political 
        subdivision thereof, or of any instrumentality of any 1 or more 
        of the foregoing which is wholly owned thereby, if--
                    ``(A)(i) such service would be excluded from the 
                term `employment' for purposes of this chapter if the 
                provisions of subsection (b)(7) as in effect on 
                December 31, 1999, had remained in effect, and (ii) the 
                requirements of paragraph (2) are met with respect to 
                such service, or
                    ``(B) the requirements of paragraph (3) are met 
                with respect to such service.
            ``(2) Exception for current employment which continues.--
                    ``(A) In general.--The requirements of this 
                paragraph are met with respect to service for any 
                employer if--
                            ``(i) such service is performed by an 
                        individual--
                                    ``(I) who was performing 
                                substantial and regular service for 
                                remuneration for that employer before 
                                January 1, 2000,
                                    ``(II) who is a bona fide employee 
                                of that employer on December 31, 1999, 
                                and
                                    ``(III) whose employment 
                                relationship with that employer was not 
                                entered into for purposes of meeting 
                                the requirements of this subparagraph, 
                                and
                            ``(ii) the employment relationship with 
                        that employer has not been terminated after 
                        December 31, 1999.
                    ``(B) Treatment of multiple agencies and 
                instrumentalities.--For purposes of subparagraph (A), 
                under regulations--
                            ``(i) all agencies and instrumentalities of 
                        a State (as defined in section 218(b) of the 
                        Social Security Act) or of the District of 
                        Columbia shall be treated as a single employer, 
                        and
                            ``(ii) all agencies and instrumentalities 
                        of a political subdivision of a State (as so 
                        defined) shall be treated as a single employer 
                        and shall not be treated as described in clause 
                        (i).
            ``(3) Exception for certain services.--
                    ``(A) In general.--The requirements of this 
                paragraph are met with respect to service if such 
                service is performed--
                            ``(i) by an individual who is employed by a 
                        State or political subdivision thereof to 
                        relieve such individual from unemployment,
                            ``(ii) in a hospital, home, or other 
                        institution by a patient or inmate thereof as 
                        an employee of a State or political subdivision 
                        thereof or of the District of Columbia,
                            ``(iii) by an individual, as an employee of 
                        a State or political subdivision thereof or of 
                        the District of Columbia, serving on a 
                        temporary basis in case of fire, storm, snow, 
                        earthquake, flood, or other similar emergency,
                            ``(iv) by any individual as an employee 
                        included under section 5351(2) of title 5, 
                        United States Code (relating to certain 
                        interns, student nurses, and other student 
                        employees of hospitals of the District of 
                        Columbia Government), other than as a medical 
                        or dental intern or a medical or dental 
                        resident in training,
                            ``(v) by an election official or election 
                        worker if the remuneration paid in a calendar 
                        year for such service is less than $1,000 with 
                        respect to service performed during 2000, and 
                        the adjusted amount determined under section 
                        210(s)(3)(C) of the Social Security Act for any 
                        subsequent year with respect to service 
                        performed during such subsequent year, except 
                        to the extent that service by such election 
                        official or election worker is included in 
                        employment under an agreement under section 218 
                        of the Social Security Act, or
                            ``(vi) by an employee in a position 
                        compensated solely on a fee basis which is 
                        treated pursuant to section 1402(c)(2)(E) as a 
                        trade or business for purposes of inclusion of 
                        such fees in net earnings from self-employment.
                    ``(B) Definitions.--As used in this paragraph, the 
                terms `State' and `political subdivision' have the 
                meanings given those terms in section 218(b) of the 
                Social Security Act.''.
            (3) Conforming amendments.--
                    (A) Subsection (j) of section 3121 of such Code 
                (relating to covered transportation service) is 
                repealed.
                    (B) Paragraph (2) of section 3121(u) of such Code 
                (relating to application of hospital insurance tax to 
                Federal, State, and local employment) is amended--
                            (i) in subparagraph (B), by striking 
                        ``service is performed'' in clause (ii) and all 
                        that follows through the end of such 
                        subparagraph and inserting ``service is service 
                        described in subsection (t)(3)(A).''; and
                            (ii) in subparagraph (C)(i), by inserting 
                        ``under subsection (b)(7) as in effect on 
                        December 31, 1999'' after ``chapter''.
    (c) Effective Date.--Except as otherwise provided in this section, 
the amendments made by this section shall apply with respect to service 
performed after December 31, 1999.

SEC. 7. GRADUAL INCREASE IN NUMBER OF BENEFIT COMPUTATION YEARS; USE OF 
              ALL YEARS IN COMPUTATION.

    (a) In General.--Section 215(b)(2)(A) of the Social Security Act 
(42 U.S.C. 415(b)(2)(A)) is amended--
            (1) in clause (i), by striking ``5 years'' and inserting 
        ``the applicable number of years for purposes of this clause''; 
        and
            (2) by striking ``Clause (ii),'' in the matter following 
        clause (ii) and inserting the following:
``For purposes of clause (i), the applicable number of years is the 
number of years specified in connection with the year in which such 
individual reaches early retirement age (as defined in section 
216(l)(2)), or, if earlier, the calendar year in which such individual 
dies, as set forth in the following table:

``If such calendar year is:         The applicable number of years is:
        2002...................................................      4.
        2003...................................................      4.
        2004...................................................      3.
        2005...................................................      3.
        2006...................................................      2.
        2007...................................................      2.
        2008...................................................      1.
        2009...................................................      1.
        After 2009.............................................      0.
Clause (ii),''.
    (b) Use of All Years in Computation.--
            (1) In general.--Section 215(b)(2)(B) of the Social 
        Security Act (42 U.S.C. 415(b)(2)(B)) is amended by striking 
        clauses (i) and (ii) and inserting the following:
            ``(i)(I) for calendar years after 2001 and before 2010, the 
        term `benefit computation years' means those computation base 
        years equal in number to the number determined under 
        subparagraph (A) plus the applicable number of years determined 
        under subclause (III), for which the total of such individual's 
        wages and self-employment income, after adjustment under 
        paragraph (3), is the largest;
            ``(II) for calendar years after 2009, the term `benefit 
        computation years' means all of the computation base years; and
            ``(III) for purposes of subclause (I), the applicable 
        number of years is the number of years specified in connection 
        with the year in which such individual reaches early retirement 
        age (as defined in section 216(l)(2)), or, if earlier, the 
        calendar year in which such individual dies, as set forth in 
        the following table:

``If such calendar year is:         The applicable number of years is:
        Before 2002............................................      0.
        2002...................................................      1.
        2003...................................................      1.
        2004...................................................      2.
        2005...................................................      2.
        2006...................................................      3.
        2007...................................................      3.
        2008...................................................      4.
        2009...................................................      4.
            ``(ii) the term `computation base years' means the calendar 
        years after 1950, except that such term excludes any calendar 
        year entirely included in a period of disability; and''.
            (2) Conforming amendment.--Section 215(b)(1)(B) of the 
        Social Security Act (42 U.S.C. 415(b)(1)(B)) is amended by 
        striking ``in those years'' and inserting ``in an individual's 
        computation base years determined under paragraph (2)(A)''.
    (c) Effective Date.--
            (1) Subsection (a).--The amendments made by subsection (a) 
        shall apply with respect to individuals attaining early 
        retirement age (as defined in section 216(l)(2) of the Social 
        Security Act) after December 31, 2001.
            (2) Subsection (b).--The amendment made by subsection (b) 
        shall apply to benefit computation years beginning after 
        December 31, 1999.

SEC. 8. ACTUARIAL ADJUSTMENT FOR RETIREMENT.

    (a) Early Retirement.--
            (1) In general.--Section 202(q) of the Social Security Act 
        (42 U.S.C. 402(q)) is amended--
                    (A) in paragraph (1)(A), by striking ``\5/9\'' and 
                inserting ``the applicable fraction (determined under 
                paragraph (12))''; and
                    (B) by adding at the end the following:
    ``(12) For purposes of paragraph (1)(A), the `applicable fraction' 
for an individual who attains the age of 62 in--
            ``(A) any year before 2001, is \5/9\;
            ``(B) 2001, is \7/12\;
            ``(C) 2002, is \11/18\;
            ``(D) 2003, is \23/36\;
            ``(E) 2004, is \2/3\; and
            ``(F) 2005 or any succeeding year, is \25/36\.''.
            (2) Months beyond first 36 months.--Section 202(q) of such 
        Act (42 U.S.C. 402(q)(9)) (as amended by paragraph (1)) is 
        amended--
                    (A) in paragraph (9)(A), by striking ``five-
                twelfths'' and inserting ``the applicable fraction 
                (determined under paragraph (13))''; and
                    (B) by adding at the end the following:
    ``(13) For purposes of paragraph (9)(A), the `applicable fraction' 
for an individual who attains the age of 62 in--
            ``(A) any year before 2001, is \5/12\;
            ``(B) 2001, is \16/36\;
            ``(C) 2002, is \16/36\;
            ``(D) 2003, is \17/36\;
            ``(E) 2004, is \17/36\; and
            ``(F) 2005 or any succeeding year, is \1/2\.''.
            (3) Effective date.--The amendments made by paragraphs (1) 
        and (2) shall apply to individuals who attain the age of 62 in 
        years after 1999.
    (b) Delayed Retirement.--Section 202(w)(6) of the Social Security 
Act (42 U.S.C. 402(w)(6)) is amended--
            (1) in subparagraph (C), by striking ``and'' at the end;
            (2) in subparagraph (D), by striking ``2004.'' and 
        inserting ``2004 and before 2007;''; and
            (3) by adding at the end the following:
            ``(E) \17/24\ of 1 percent in the case of an individual who 
        attains the age of 62 in a calendar year after 2006 and before 
        2009;
            ``(F) \3/4\ of 1 percent in the case of an individual who 
        attains the age of 62 in a calendar year after 2008 and before 
        2011;
            ``(G) \19/24\ of 1 percent in the case of an individual who 
        attains the age of 62 in a calendar year after 2010 and before 
        2013; and
            ``(H) \5/6\ of 1 percent in the case of an individual who 
        attains the age of 62 in a calendar year after 2012.''.

SEC. 9. IMPROVEMENTS IN PROCESS FOR COST-OF-LIVING ADJUSTMENTS.

    (a) Annual Declarations of Achieved Substitution Bias Correction 
and Persisting Upper Level Substitution Bias.--
            (1) Achieved substitution bias correction.--Not later than 
        October 1, 1998, and annually thereafter, the Commissioner of 
        the Bureau of Labor Statistics shall publish in the Federal 
        Register an estimate of the number of percentage points by 
        which the annual rate of change in the Consumer Price Index is 
        reduced below the rate it would otherwise have attained by 
        reason of adjustments in the determination of such index 
        instituted by the Bureau after December 31, 1997.
            (2) Upper level substitution bias.--Not later than August 
        1, 1999, and annually thereafter, the Commissioner of the 
        Bureau of Labor Statistics shall publish in the Federal 
        Register an estimate of the upper level substitution bias 
        retained in the Consumer Price Index, expressed in terms of a 
        percentage point effect on the annual rate of change in the 
        Consumer Price Index determined through the use of a 
        superlative index that accounts for changes that consumers make 
        in the quantities of goods and services consumed.
    (b) Funding for CPI Improvements.--
            (1) In general.--There is hereby appropriated to the Bureau 
        of Labor Statistics in the Department of Labor, for each of 
        fiscal years 1998, 1999, and 2000, $30,000,000 for use by the 
        Bureau for the following purposes:
                    (A) Research, evaluation, and implementation of a 
                superlative index to estimate upper level substitution 
                bias in the Consumer Price Index.
                    (B) Expansion of the Consumer Expenditure Survey 
                and the Point of Purchase Survey.
                    (C) Implementation of revisions to the Consumer 
                Price Index with respect to programs under title II of 
                the Social Security Act (42 U.S.C. 401 et seq.).
            (2) Reports.--The Commissioner of the Bureau of Labor 
        Statistics shall submit reports regarding the use of 
        appropriations made under paragraph (1) to the Committee on 
        Appropriations of the House of Representative and the Committee 
        on Appropriations of the Senate upon the request of each 
        Committee.
    (c) Information Sharing.--The Commissioner of the Bureau of Labor 
Statistics may secure directly from the Secretary of Commerce 
information necessary for purposes of calculating the Consumer Price 
Index. Upon request of the Commissioner of the Bureau of Labor 
Statistics, the Secretary of Commerce shall furnish that information to 
the Commissioner.
    (d) Administrative Advisory Committee.--The Bureau of Labor 
Statistics shall, in consultation with the National Bureau of Economic 
Research, the American Economic Association, and the National Academy 
of Statisticians, establish an administrative advisory committee. The 
advisory committee shall periodically advise the Bureau of Labor 
Statistics regarding revisions of the Consumer Price Index and conduct 
research and experimentation with alternative data collection and 
estimating approaches.
    (e) Modifications to Cost-of-Living Indexing of Benefits.--Section 
215(i)(1) of the Social Security Act (42 U.S.C. 415(i)(1)) is amended--
            (1) by striking ``Consumer Price Index'' each place it 
        occurs and inserting ``Social Security Consumer Price Index'';
            (2) in subparagraph (D), by striking ``(as prepared by the 
        Department of Labor)''; and
            (3) in subparagraph (G), by striking the period at the end 
        and inserting ``; and'';
            (4) by adding at the end the following:
            ``(H) the term `Social Security Consumer Price Index', for 
        a month in any year after 1999, means the Consumer Price Index 
        for such month (as prepared by the Department of Labor), 
        reflecting adjustments to the annual rate of growth in such 
        index equal to the greater of--
                    ``(i) the excess of 0.5 percentage points over the 
                achieved bias correction (as last published by the 
                Secretary of Labor pursuant to section 211(a)(1) of the 
                Strengthening Social Security Act of 1998), or
                    ``(ii) the upper level substitution bias (as last 
                published by the Secretary of Labor pursuant to section 
                211(a)(2) of the Strengthening Social Security Act of 
                1998).''.

SEC. 10. PHASED REDUCTION IN SPOUSAL BENEFITS OTHER THAN SURVIVOR'S 
              BENEFITS TO 33 PERCENT OF PRIMARY INSURANCE AMOUNT.

    (a) Wife's Insurance Benefits.--Section 202(b)(2) of the Social 
Security Act (42 U.S.C. 402(b)(2)) is amended to read as follows:
    ``(2)(A) Except as provided in subsection (q) and paragraph (4) of 
this subsection, such wife's insurance benefit for each month shall be 
equal to the applicable percentage of the primary insurance amount of 
her husband (or, in the case of a divorced wife, her former husband) 
for the calendar year in which such individual becomes eligible for 
such benefit.
    ``(B) For purposes of subparagraph (A), the applicable percentage 
for any calendar year shall be equal to 50 percent, reduced (but not 
below 33 percent) by 1 percentage point for each year after 1999.
    ``(C) For purposes of subparagraph (A)--
            ``(i) an individual shall be treated as eligible for a 
        wife's insurance benefit if such individual meets the 
        requirements of subparagraphs (B), (C), and (D) of paragraph 
        (1), and
            ``(ii) in determining when an individual becomes eligible 
        for a wife's insurance benefit, any break in eligibility of 
        less than 12 consecutive months shall not be taken into 
        account.''.
    (b) Husband's Insurance Benefits.--Section 202(c)(3) of the Social 
Security Act (42 U.S.C. 402(c)(3)) is amended to read as follows:
    ``(3)(A) Except as provided in subsection (q) and paragraph (2) of 
this subsection, such husband's insurance benefit for each month shall 
be equal to the applicable percentage (as determined under subsection 
(b)(2)(B)) of the primary insurance amount of his wife (or, in the case 
of a divorced husband, his former wife) for the calendar year in which 
such individual becomes eligible for such benefit.
    ``(B) For purposes of subparagraph (A)--
            ``(i) an individual shall be treated as eligible for a 
        husband's insurance benefit if such individual meets the 
        requirements of subparagraphs (B), (C), and (D) of paragraph 
        (1), and
            ``(ii) in determining when an individual becomes eligible 
        for a husband's insurance benefit, any break in eligibility of 
        less than 12 consecutive months shall not be taken into 
        account.''.

SEC. 11. ADJUSTMENT TO UPPER 2 BENEFIT FORMULA FACTORS.

    Section 215(a)(1)(B) of the Social Security Act (42 U.S.C. 
415(a)(1)(B)) is amended--
            (1) by redesignating clause (iii) as clause (iv); and
            (2) by inserting after clause (ii) the following:
    ``(iii) For individuals who initially become eligible for old-age 
or disability insurance benefits, or who die (before becoming eligible 
for such benefits), in any calendar year after 2002, each of the 
amounts otherwise established for purposes of clauses (ii) and (iii) of 
subparagraph (A) under this subparagraph shall be multiplied the 
applicable number of times by .98. For purposes of the preceding 
sentence, the term `applicable number of times' means a number equal to 
the lesser of 20 or the number of years beginning with 2003 and ending 
with the year of initial eligibility or death.''

SEC. 12. PHASED-IN INCREASE IN SOCIAL SECURITY RETIREMENT AGES.

    (a) Normal Retirement Age.--Section 216(l) of the Social Security 
Act (42 U.S.C. 416(l) is amended--
            (1) in paragraph (1), by striking subparagraphs (B), (C), 
        (D), and (E) and inserting the following:
                    ``(B)(i) with respect to an individual who attains 
                age 62 (or in the case of a widow's or widower's 
                insurance benefit, age 60) after December 31, 1999, and 
                before January 1, 2029, 65 years of age plus \2/12\ of 
                the number of months in the period beginning with 
                January 2000 and ending with December of the year in 
                which the individual attains age 62 (or in the case of 
                a widow's or widower's insurance benefit, age 60),
                    ``(ii) with respect to an individual who attains 
                age 62 (or in the case of a widow's or widower's 
                insurance benefit, age 60) after December 31, 2028, 70 
                years of age, and
                    ``(iii) with respect to an individual who attains 
                age 62 (or in the case of a widow's or widower's 
                insurance benefit, age 60) after December 31, 2029, 70 
                years of age plus \1/18\ of the number of months in the 
                period beginning with January 2030 and ending with 
                December of the year in which the individual attains 
                age 62 (or in the case of a widow's or widower's 
                insurance benefit, age 60) (rounded down to a full 
                month).''; and
            (2) by striking paragraph (3).
    (b) Early Retirement Age.--Section 216(l)(2) of the Social Security 
Act (42 U.S.C. 416(l)(2)) is amended to read as follows:
    ``(2) The term `early retirement age' means--
                    ``(A)(i) in the case of an old-age, wife's, or 
                husband's insurance benefit, except as provided in 
                subparagraph (B), age 62, and
                    ``(ii) in the case of a widow's or widower's 
                insurance benefit, age 60;
                    ``(B)(i) with respect to an individual who attains 
                age 62 after December 31, 2011, and before January 1, 
                2029, 62 years of age plus \2/12\ of the number of 
                months in the period beginning with January 2012 and 
                ending with December of the year in which the 
                individual attains age 62,
                    ``(ii) with respect to an individual who attains 
                age 62 after December 31, 2028, 65 years of age, and
                    ``(iii) with respect to an individual who attains 
                age 62 after December 31, 2029, 65 years of age plus 
                \1/18\ of the number of months in the period beginning 
                with January 2030 and ending with December of the year 
                in which the individual attains age 62 (rounded down to 
                a full month); and

SEC. 13. MECHANISM FOR REMEDYING UNFORESEEN DETERIORATION IN SOCIAL 
              SECURITY SOLVENCY.

    (a) In General.--Section 709 of the Social Security Act (42 U.S.C. 
910) is amended--
            (1) by redesignating subsection (b) as subsection (c); and
            (2) by striking ``Sec. 709. (a) If the Board of Trustees'' 
        and all that follows through ``any such Trust Fund'' and 
        inserting the following:
    ``Sec. 709. (a)(1)(A) If the Board of Trustees of the Federal Old-
Age and Survivors Insurance Trust Fund and the Federal Disability 
Insurance Trust Fund determines at any time, using intermediate 
actuarial assumptions, that the balance ratio of either such Trust Fund 
for any calendar year during the succeeding period of 75 calendar years 
will be zero, the Board shall promptly submit to each House of the 
Congress and to the President a report setting forth its 
recommendations for statutory adjustments affecting the receipts and 
disbursements of such Trust Fund necessary to maintain the balance 
ratio of such Trust Fund at not less than 20 percent, with due regard 
to the economic conditions which created such inadequacy in the balance 
ratio and the amount of time necessary to alleviate such inadequacy in 
a prudent manner. The report shall set forth specifically the extent to 
which benefits would have to be reduced, taxes under section 1401, 
3101, or 3111 of the Internal Revenue Code of 1986 would have to be 
increased, or a combination thereof, in order to obtain the objectives 
referred to in the preceding sentence.
    ``(B) In addition to any reports under subparagraph (A), the Board 
shall, not later than May 30, 2001, prepare and submit to Congress and 
the President recommendations for statutory adjustments to the 
disability insurance program under title II of this Act to modify the 
changes in disability benefits under the Strengthening Social Security 
Act of 1998 without reducing the balance ratio of the Federal 
Disability Insurance Trust Fund. The Board shall develop such 
recommendations in consultation with the National Council on 
Disability, taking into consideration the adequacy of benefits under 
the program, the relationship of such program with old age benefits 
under such title, and changes in the process for determining initial 
eligibility and reviewing continued eligibility for benefits under such 
program.
    ``(2)(A) The President shall, no later than 30 days after the 
submission of the report to the President, transmit to the Board and to 
the Congress a report containing the President's approval or 
disapproval of the Board's recommendations.
    ``(B) If the President approves all the recommendations of the 
Board, the President shall transmit a copy of such recommendations to 
the Congress as the President's recommendations, together with a 
certification of the President's adoption of such recommendations.
    ``(C) If the President disapproves the recommendations of the 
Board, in whole or in part, the President shall transmit to the Board 
and the Congress the reasons for that disapproval. The Board shall then 
transmit to the Congress and the President, no later than 60 days after 
the date of the submission of the original report to the President, a 
revised list of recommendations.
    ``(D) If the President approves all of the revised recommendations 
of the Board transmitted to the President under subparagraph (C), the 
President shall transmit a copy of such revised recommendations to the 
Congress as the President's recommendations, together with a 
certification of the President's adoption of such recommendations.
    ``(E) If the President disapproves the revised recommendations of 
the Board, in whole or in part, the President shall transmit to the 
Board and the Congress the reasons for that disapproval, together with 
such revisions to such recommendations as the President determines are 
necessary to bring such recommendations within the President's 
approval. The President shall transmit a copy of such recommendations, 
as so revised, to the Board and the Congress as the President's 
recommendations, together with a certification of the President's 
adoption of such recommendations.
    ``(3)(A) This paragraph is enacted by Congress--
            ``(i) as an exercise of the rulemaking power of the Senate 
        and the House of Representatives, respectively, and as such it 
        is deemed a part of the rules of each House, respectively, but 
        applicable only with respect to the procedure to be followed in 
        that House in the case of a joint resolution described in 
        subparagraph (B), and it supersedes other rules only to the 
extent that it is inconsistent with such rules; and
            ``(ii) with full recognition of the constitutional right of 
        either House to change the rules (so far as relating to the 
        procedure of that House) at any time, in the same manner, and 
        to the same extent as in the case of any other rule of that 
        House.
    ``(B) For purposes of this paragraph, the term `joint resolution' 
means only a joint resolution which is introduced within the 10-day 
period beginning on the date on which the President transmits the 
President's recommendations, together with the President's 
certification, to the Congress under subparagraph (B), (D), or (E) of 
paragraph (2), and--
            ``(i) which does not have a preamble;
            ``(ii) the matter after the resolving clause of which is as 
        follows: `That the Congress approves the recommendations of the 
        President as transmitted on ____ pursuant to section 709(a) of 
        the Social Security Act, as follows: ________', the first blank 
        space being filled in with the appropriate date and the second 
        blank space being filled in with the statutory adjustments 
        contained in the recommendations; and
            ``(iii) the title of which is as follows: `Joint resolution 
        approving the recommendations of the President regarding social 
        security.'.
    ``(C) A joint resolution described in subparagraph (B) that is 
introduced in the House of Representatives shall be referred to the 
Committee on Ways and Means of the House of Representatives. A joint 
resolution described in subparagraph (B) introduced in the Senate shall 
be referred to the Committee on Finance of the Senate.
    ``(D) If the committee to which a joint resolution described in 
subparagraph (B) is referred has not reported such joint resolution (or 
an identical joint resolution) by the end of the 20-day period 
beginning on the date on which the President transmits the 
recommendation to the Congress under paragraph (2), such committee 
shall be, at the end of such period, discharged from further 
consideration of such joint resolution, and such joint resolution shall 
be placed on the appropriate calendar of the House involved.
    ``(E)(i) On or after the third day after the date on which the 
committee to which such a joint resolution is referred has reported, or 
has been discharged (under subparagraph (D)) from further consideration 
of, such a joint resolution, it is in order (even though a previous 
motion to the same effect has been disagreed to) for any Member of the 
respective House to move to proceed to the consideration of the joint 
resolution. A Member may make the motion only on the day after the 
calendar day on which the Member announces to the House concerned the 
Member's intention to make the motion, except that, in the case of the 
House of Representatives, the motion may be made without such prior 
announcement if the motion is made by direction of the committee to 
which the joint resolution was referred. All points of order against 
the joint resolution (and against consideration of the joint 
resolution) are waived. The motion is highly privileged in the House of 
Representatives and is privileged in the Senate and is not debatable. 
The motion is not subject to amendment, or to a motion to postpone, or 
to a motion to proceed to the consideration of other business. A motion 
to reconsider the vote by which the motion is agreed to or disagreed to 
shall not be in order. If a motion to proceed to the consideration of 
the joint resolution is agreed to, the respective House shall 
immediately proceed to consideration of the joint resolution without 
intervening motion, order, or other business, and the joint resolution 
shall remain the unfinished business of the respective House until 
disposed of.
    ``(ii) Debate on the joint resolution, and on all debatable motions 
and appeals in connection therewith, shall be limited to not more than 
2 hours, which shall be divided equally between those favoring and 
those opposing the joint resolution. An amendment to the joint 
resolution is not in order. A motion further to limit debate is in 
order and not debatable. A motion to postpone, or a motion to proceed 
to the consideration of other business, or a motion to recommit the 
joint resolution is not in order. A motion to reconsider the vote by 
which the joint resolution is agreed to or disagreed to is not in 
order.
    ``(iii) Immediately following the conclusion of the debate on a 
joint resolution described in subparagraph (B) and a single quorum call 
at the conclusion of the debate if requested in accordance with the 
rules of the appropriate House, the vote on final passage of the joint 
resolution shall occur.
    ``(iv) Appeals from the decisions of the Chair relating to the 
application of the rules of the Senate or the House of Representatives, 
as the case may be, to the procedure relating to a joint resolution 
described in subparagraph (B) shall be decided without debate.
    ``(F)(i) If, before the passage by one House of a joint resolution 
of that House described in subparagraph (B), that House receives from 
the other House a joint resolution described in subparagraph (B), then 
the following procedures shall apply:
            ``(I) The joint resolution of the other House shall not be 
        referred to a committee and may not be considered in the House 
        receiving it except in the case of final passage as provided in 
        subclause (II).
            ``(II) With respect to a joint resolution described in 
        subparagraph (B) of the House receiving the joint resolution, 
        the procedure in that House shall be the same as if no joint 
        resolution had been received from the other House, but the vote 
        on final passage shall be on the joint resolution of the other 
        House.
    ``(ii) Upon disposition of the joint resolution received from the 
other House, it shall no longer be in order to consider the joint 
resolution that originated in the receiving House.
    ``(b) If the Board of Trustees of the Federal Hospital Insurance 
Trust Fund or the Federal Supplementary Medical Insurance Trust Fund 
determines as any time that the balance ratio of either such Trust 
Fund''.
    (b) Conforming Amendments.--
            (1) Section 709(b) of such Act (as amended by subsection 
        (a) of this section) is amended by striking ``any such'' and 
        inserting ``either such''.
            (2) Section 709(c) of such Act (as redesignated by 
        subsection (a) of this section) is amended by inserting ``or 
        (b)'' after ``subsection (a)''.
                                 <all>