[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4713 Introduced in House (IH)]







106th CONGRESS
  2d Session
                                H. R. 4713

   To amend the Internal Revenue Code of 1986 and the Surface Mining 
Control and Reclamation Act of 1977 to restore stability and equity to 
 the financing of the United Mine Workers of America Combined Benefit 
 Fund by eliminating the liability of reachback operators, to provide 
   additional sources of revenue to the Fund, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 21, 2000

  Ms. Pryce of Ohio (for herself, Mr. Armey, Mr. Camp, Ms. Dunn, Mrs. 
  Johnson of Connecticut, Mr. Sessions, and Mr. Upton) introduced the 
following bill; which was referred to the Committee on Ways and Means, 
   and in addition to the Committee on Resources, 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 Surface Mining 
Control and Reclamation Act of 1977 to restore stability and equity to 
 the financing of the United Mine Workers of America Combined Benefit 
 Fund by eliminating the liability of reachback operators, to provide 
   additional sources of revenue to the Fund, 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; AMENDMENTS OF 1986 CODE.

    (a) Short Title.--This Act may be cited as the ``Combined Fund 
Stability and Fairness Act''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.

                     TITLE I--REACHBACK PROVISIONS

SEC. 101. REFORM OF REACHBACK PROVISIONS OF COAL INDUSTRY HEALTH 
              BENEFIT SYSTEM.

    (a) Agreements Covered by Health Benefit System.--
            (1) In general.--Section 9701(b)(1) (defining coal wage 
        agreement) is amended to read as follows:
            ``(1) Coal agreements.--
                    ``(A) 1988 agreement.--The term `1988 agreement' 
                means the collective bargaining agreement between the 
                settlors which became effective on February 1, 1988.
                    ``(B) Coal wage agreement.--The term `coal wage 
                agreement' means the 1988 agreement and any predecessor 
                to the 1988 agreement.''
            (2) Conforming amendment.--Section 9701(b) (relating to 
        agreements) is amended by striking paragraph (3).
    (b) Definitions Applicable to Operators.--
            (1) Signatory operator.--Section 9701(c)(1) (defining 
        signatory operator) is amended to read as follows:
            ``(1) Signatory operator.--The term `signatory operator' 
        means a 1988 agreement operator.''
            (2) 1988 agreement operator.--Section 9701(c)(3) (defining 
        1988 agreement operator) is amended to read as follows:
            ``(3) 1988 agreement operator.--The term `1988 agreement 
        operator' means--
                    ``(A) an operator which was a signatory to the 1988 
                agreement, or
                    ``(B) a person in business which, during the term 
                of the 1988 agreement, was a signatory to an agreement 
                (other than the National Coal Mine Construction 
                Agreement or the Coal Haulers' Agreement) containing 
                pension and health care contribution and benefit 
                provisions which are the same as those contained in the 
                1988 agreement.
        Such term shall not include any operator who was assessed, and 
        paid the full amount of, contractual withdrawal liability to 
        the 1950 UMWA Benefit Plan, the 1974 UMWA Benefit Plan, or the 
        Combined Fund.''
            (3) Confirming amendments.--
                    (A) Section 9711(a) is amended by striking 
                ``maintained pursuant to a 1978 or subsequent coal wage 
                agreement''.
                    (B) Section 9711(b)(1) is amended by striking 
                ``pursuant to a 1978 or subsequent coal wage 
                agreement''.
    (c) Modifications To Reflect Reachback Reforms.--
            (1) Board of trustees of combined fund.--
                    (A) In general.--Section 9702(b)(1) is amended--
                            (i) by striking ``one individual who 
                        represents'' in subparagraph (A) and inserting 
                        ``two individuals who represent'',
                            (ii) by striking subparagraph (B) and 
                        redesignating subparagraphs (C) and (D) as 
                        subparagraphs (B) and (C), respectively, and
                            (iii) by striking ``(A), (B), and (C)'' in 
                        subparagraph (C) (as so redesignated) and 
                        inserting ``(A) and (B)''.
                    (B) Conforming amendment.--Section 9702(b)(3) is 
                amended to read as follows:
            ``(3) Special rule.--If the BCOA ceases to exist, any 
        trustee or successor under paragraph (1)(A) shall be designated 
        by the 3 employers who were members of the BCOA on the 
        enactment date and who have been assigned the greatest number 
        of eligible beneficiaries under section 9706.''
                    (C) Transition rule.--Any trustee serving on the 
                date of the enactment of this Act who was appointed to 
                serve under section 9702(b)(1)(B) of the Internal 
                Revenue Code of 1986 (as in effect before the 
                amendments made by this paragraph) shall continue to 
                serve until a successor is appointed under section 
                9702(b)(1)(A) of such Code (as in effect after such 
                amendments).
            (2) Assignment of beneficiaries.--Section 9706 (relating to 
        assignment of eligible beneficiaries) is amended by adding at 
        the end the following:
    ``(h) Assignment as of October 1, 2000.--
            ``(1) In general.--Effective October 1, 2000, the 
        Commissioner of Social Security shall--
                    ``(A) revoke all assignments to persons other than 
                1988 agreement operators for purposes of assessing 
                premiums for periods after September 30, 2000,
                    ``(B) make no further assignments to persons other 
                than 1988 agreement operators, and
                    ``(C) terminate all unpaid liabilities of persons 
                other than 1988 agreement operators with respect to 
                eligible beneficiaries whose assignment to such persons 
                is pending on October 1, 2000.
            ``(2) Reassignment upon purchase.--This subsection shall 
        not be construed to prohibit the reassignment under subsection 
        (b)(2) of an eligible beneficiary.''
            (3) Liability for 1992 plan.--
                    (A) In general.--Section 9712(d) (relating to 
                guarantee of benefits) is amended by striking paragraph 
                (3) and by redesignating paragraphs (4), (5), and (6) 
                as paragraphs (3), (4), and (5), respectively.
                    (B) Conforming amendment.--Section 9712(d)(3) (as 
                redesignated under subparagraph (A)) is amended by 
                striking ``or last signatory operator described in 
                paragraph (3)''.
                    (C) Effective date.--The amendments made by this 
                paragraph shall apply to premiums assessed for periods 
                after September 30, 2000, except that a person other 
                than a 1988 agreement operator shall not be liable for 
                any unpaid premium under section 9712(d) of the 
                Internal Revenue Code of 1986 as of such date if 
                liability for such premium had not been assessed or was 
                being contested on such date.

                     TITLE II--FINANCING PROVISIONS

                          Subtitle A--Premiums

SEC. 201. REDUCTION IN ANNUAL PREMIUMS TO COAL MINERS COMBINED FUND IF 
              SURPLUS EXISTS.

    (a) In General.--Part II of subchapter B of chapter 99 (relating to 
financing of Combined Benefit Fund) is amended by inserting after 
section 9704 the following new section:

``SEC. 9704A. REDUCTIONS IN HEALTH BENEFIT PREMIUM IF SURPLUS EXISTS.

    ``(a) General Rule.--If this section applies to any plan year, the 
per beneficiary premium used for purposes of computing the health 
benefit premium under section 9704(b) for the plan year shall be the 
reduced per beneficiary premium determined under subsection (c).
    ``(b) Years to Which Section Applies.--
            ``(1) In general.--This section applies to any plan year 
        beginning after September 30, 2000, if the trustees determine 
        that the Combined Fund has an excess reserve for the plan year.
            ``(2) Excess reserve.--For purposes of this section--
                    ``(A) In general.--The term `excess reserve' means, 
                with respect to any plan year, the excess (if any) of--
                            ``(i) the projected net assets as of the 
                        close of the test period for the plan year, 
                        over
                            ``(ii) the projected 3-month asset reserve 
                        as of such time.
                    ``(B) Projected net assets.--For purposes of 
                subparagraph (A)(i), the projected net assets shall be 
                the amount of the net assets which the trustees 
                determine will be available at the end of the test 
                period for projected fund benefits. Such determination 
                shall be made in the same manner used by the Combined 
                Fund to calculate net assets available for projected 
                fund benefits in the Statement of Net Assets (Deficits) 
                Available for Fund Benefits for purposes of the monthly 
                financial statements of the Combined Fund for the plan 
                year beginning October 1, 1999.
                    ``(C) Projected 3-month asset reserve.--For 
                purposes of subparagraph (A)(ii), the projected 3-month 
                asset reserve is an amount equal to 25 percent of the 
                projected expenses (including administrative expenses) 
                from the health benefit premium account and unassigned 
                beneficiaries premium account for the plan year 
                immediately following the test period. The 
                determination of such amount shall be based on the 10-
                year forecast of the projected net assets and cash 
                balance of the Combined Fund prepared annually by an 
                actuary retained by the Combined Fund.
                    ``(D) Test period.--For purposes of this section, 
                the term `test period' means, with respect to any plan 
                year, the plan year and the following plan year.
    ``(c) Reduced Per Beneficiary Premium.--For purposes of this 
section, the reduced per beneficiary premium for any plan year to which 
this section applies is the per beneficiary premium determined under 
section 9704(b)(2) without regard to this section, reduced (but not 
below zero) by--
            ``(1) the excess reserve for the plan year, divided by
            ``(2) the total number of eligible beneficiaries which are 
        assigned to assigned operators under section 9706 as of the 
        close of the preceding plan year.
    ``(d) Termination of Premium Reduction.--If, on any day during a 
plan year to which this section applies, the Combined Fund has net 
assets available for projected fund benefits (determined in the same 
manner as projected net assets under subsection (b)(2)(B)) in an amount 
less than the projected 3-month asset reserve determined under 
subsection (b)(2)(C) for the plan year--
            ``(1) this section shall not apply to months in the plan 
        year beginning after such day, and
            ``(2) the monthly installment under section 9704(g)(1) for 
        such months shall be equal to the amount which would have been 
        determined if the health benefits premium under section 9704(b) 
        had not been reduced under this section for the plan year.''
    (b) Conforming Amendments.--
            (1) Section 9704(a) (relating to annual premiums) is 
        amended by striking ``Each'' and inserting ``Subject to section 
        9704A, each''.
            (2) The table of sections for part II of subchapter B of 
        chapter 99 is amended by inserting after the item relating to 
        section 9704 the following new item:

                              ``Sec. 9704A. Reductions in health 
                                        benefit premium if surplus 
                                        exists.''
    (c) Effective Date.--The amendments made by this subsection shall 
apply to plan years of the Combined Fund beginning after September 30, 
2000.

SEC. 202. REFUND OF CONTRIBUTIONS PAID BY CERTAIN SMALL ENTITIES TO 
              UNITED MINE WORKERS COMBINED BENEFIT FUND.

    (a) In General.--Insert after section 9704A the following:

``SEC. 9704B. REFUNDS OF ANNUAL PREMIUMS OF CERTAIN SMALL ENTITIES.

    ``(a) General Rule.--The annual premiums paid by certain small 
entities under section 9704(a) shall, in the case of an eligible small 
entity which was an assigned operator prior to October 1, 2000, be 
refunded as provided in subsection (b).
    ``(b) Refunds for Eligible Small Entities Which Were Formerly 
Assigned Operators.--
            ``(1) In general.--To the extent an eligible small entity 
        which was an assigned operator prior to October 1, 2000, has 
        paid premiums to the combined fund, any such premiums shall be 
        refunded by the combined fund.
            ``(2) Years to which subsection applies.--This subsection 
        shall apply to any plan year of the combined fund which began 
        before October 1, 2000.
            ``(3) Eligible small entities.--For purposes of this 
        section, the term `eligible small entity' means any entity 
        which was an assigned operator prior to October 1, 2000, is not 
        a 1988 agreement operator and had average annual gross income 
        for purposes of chapter 1 for the 5-taxable-year period ending 
        with the entity's most recent taxable year ending before 
        October 1, 1993, not exceeding $2,000,000.
            ``(4) Aggregation rules.--In determining gross income or 
        taxable income for purposes of this section, an entity which 
        was an assigned operator prior to October 1, 2000, and any 
        related persons shall be treated as 1 person.
    ``(c) Overall Limitation.--In no event shall the total refunds of 
annual premiums made by the combined fund under this section for any 
plan year exceed $10,000,000.''.
    (b) Conforming Amendment.--The table of sections for part II of 
subchapter B of chapter 99 of the Internal Revenue Code of 1986 is 
amended by inserting after the item relating to section 9704 the 
following new item:

                              ``Sec. 9704B. Refunds of annual premiums 
                                        of certain small entities.''.

SEC. 203. ELECTION TO PREFUND REQUIRED CONTRIBUTIONS.

    (a) Combined Fund.--Section 9704(g) (relating to payment of 
premiums) is amended by redesignating paragraph (2) as paragraph (3) 
and by inserting after paragraph (1) the following:
            ``(2) Election to prefund.--
                    ``(A) In general.--An assigned operator shall be 
                entitled to prefund its obligations to the Combined 
                Fund by depositing into an irrevocable trust dedicated 
                solely to the payment of such obligations an amount 
                which the board of trustees determines, on the basis of 
                reasonable actuarial assumptions, to be equal to the 
                present value of the operator's present and future 
                obligations to the Combined Fund.
                    ``(B) Effects on liability.--If an assigned 
                operator prefunds its obligations under this 
                paragraph--
                            ``(i) the assigned operator (and any 
                        successor) shall continue to remain liable for 
                        such obligations if the amount deposited is 
                        insufficient, but
                            ``(ii) any related person to such operator 
                        (or successor) shall be relieved of any 
                        liability for such obligations.''
    (b) 1992 Fund.--Section 9712(d) (relating to guarantee of 
benefits), as amended by section 101, is amended by adding at the end 
the following:
            ``(6) Election to prefund.--
                    ``(A) In general.--A 1988 last signatory operator 
                shall be entitled to prefund its obligations to the 
                1992 UMWA Benefit Plan by depositing into an 
                irrevocable trust dedicated solely to the payment of 
                such obligations an amount which the board of trustees 
                determines, on the basis of reasonable actuarial 
                assumptions, to be equal to the present value of the 
                operator's present and future obligations to such plan.
                    ``(B) Effects on liability.--If a 1988 last 
                signatory operator prefunds its obligations under this 
                paragraph--
                            ``(i) the operator (and any successor) 
                        shall continue to remain liable for such 
                        obligations if the amount deposited is 
                        insufficient, but
                            ``(ii) any related person to such operator 
                        (or successor) shall be relieved of any 
                        liability for such obligations.''

SEC. 204. FIRST YEAR PAYMENTS OF 1988 OPERATORS.

    So much of section 9704(i)(1)(D) as precedes clause (ii) is amended 
to read as follows:
                    ``(D) Premium reductions and refunds.--
                            ``(i) 1st year payments.--In the case of a 
                        1988 agreement operator making payments under 
                        subparagraph (A)--
                                    ``(I) the premium of such operator 
                                under subsection (a) shall be reduced 
                                by the amount paid under subparagraph 
                                (A) by such operator for the plan year 
                                beginning February 1, 1993, or
                                    ``(II) if the amount so paid 
                                exceeds the operator's liability under 
                                subsection (a), the excess shall be 
                                refunded to the operator.''

       Subtitle B--Transfers From Abandoned Mine Reclamation Fund

SEC. 211. TRANSFER OF INTEREST FROM ABANDONED MINE RECLAMATION FUND TO 
              COMBINED FUND.

    (a) In General.--Section 402(h)(2) of the Surface Mining Control 
and Reclamation Act of 1977 (30 U.S.C. 1232(h)(2)) is amended to read 
as follows:
            ``(2)(A) Except as provided in subparagraph (B), the 
        Secretary shall transfer from the fund to the United Mine 
        Workers of America Combined Benefit Fund established under 
        section 9702 of the Internal Revenue Code of 1986 for any 
        fiscal year the amount of interest which the Secretary 
        estimates will be earned and paid to the fund during the fiscal 
        year.
            ``(B) The Secretary shall increase the amount transferred 
        under subparagraph (A) for fiscal year 2001 by the excess of--
                    ``(i) the total amount of interest earned and paid 
                to the fund after September 30, 1992, and before 
                October 1, 2000, over
                    ``(ii) the total amount transferred to the Combined 
                Fund under this subsection for fiscal years beginning 
                before October 1, 2000.''
    (b) Conforming Amendments.--Section 204(h) of such Act (30 U.S.C. 
1232(h)) is amended by striking paragraph (3) and by redesignating 
paragraph (4) as paragraph (3).
    (c) Effective Date.--The amendments made by this section shall 
apply to fiscal years beginning after September 30, 2000.

SEC. 212. MODIFICATIONS OF ABANDONED MINE RECLAMATION FEE PROGRAM.

    (a) Reductions in Reclamation Fees.--Section 402(a) of the Surface 
Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(a)) is 
amended--
            (1) by striking ``35 cents'' and inserting ``20 cents'',
            (2) by striking ``15 cents'' and inserting ``5 cents'', and
            (3) by striking ``10 cents'' and inserting ``5 cents''.
    (b) Extension of Fee Program.--Section 402(b) of such Act (30 
U.S.C. 1232(b)) is amended by striking ``2004'' and inserting ``2010''.
    (c) Effective Date.--The amendments made by subsection (a) shall 
apply to fiscal years beginning after September 30, 2000.

SEC. 213. USE OF FUNDS TRANSFERRED FROM ABANDONED MINE RECLAMATION 
              FUND.

    (a) In General.--Section 9705(b)(2) (relating to use of funds) is 
amended to read as follows:
            ``(2) Use of funds.--The amount transferred under paragraph 
        (1) for any fiscal year shall be used--
                    ``(A) first, to refund to an assigned operator (and 
                any related person to such operator) an amount equal to 
                the sum of--
                            ``(i) any amount paid by such operator or 
                        person to the Combined Fund (and not previously 
                        refunded) solely by reason of the operator 
                        having been a signatory to a pre-1974 coal wage 
                        agreement, plus
                            ``(ii) interest on the amount under clause 
                        (i) at the overpayment rate established under 
                        section 6621 for the period from the payment of 
                        such amount to the refund under this 
                        subparagraph,
                    ``(B) second, to make any refund required under 
                section 9704(i)(1)(D)(i)(II),
                    ``(C) third, to proportionately reduce the 
                unassigned beneficiary premium under section 9704(a)(3) 
                of each assigned operator for the plan year in which 
                transferred, and
                    ``(D) last, to pay the amount of any other 
                obligation occurring in the Combined Fund.''
    (b) Effective Date.--The amendment made by this section shall apply 
to fiscal years beginning after September 30, 2000.

                       Subtitle C--Authorization

SEC. 221. AUTHORIZATION OF TRANSFER OF FUNDS TO COMBINED BENEFIT FUND.

    Section 9705 (relating to transfers to the Combined Benefit Fund) 
is amended by adding at the end the following:
    ``(c) Authorization of Appropriations.--
            ``(1) In general.--There is authorized to be appropriated 
        $38,000,000 for each fiscal year beginning after September 30, 
        2000.
            ``(2) Use of funds.--Any amounts transferred to the 
        Combined Fund under paragraph (1) shall be available, without 
        fiscal year limitation, to cover any shortfall in any premium 
        account established under section 9704(e).
            ``(3) Transfers.--
                    ``(A) In general.--The Secretary shall transfer 
                amounts appropriated under paragraph (1) on October 1 
                of each fiscal year.
                    ``(B) Excess amounts.--If the Secretary, after 
                examining the audit of the Combined Fund by the 
                Comptroller General of the United States, determines 
                that the amount transferred for any fiscal year exceeds 
                the amount required to cover shortfalls for that year, 
                the Secretary shall notify the Committees on 
                Appropriations of the House of Representatives and the 
                Senate and the authorization of appropriations for the 
                first fiscal year after the determination shall be 
                reduced by the amount of the excess.''

SEC. 222. ANNUAL AUDIT.

    Section 9702 (relating to establishment of the Combined Fund) is 
amended by adding at the end the following:
    ``(d) Annual Audit.--
            ``(1) Audit.--The Comptroller General of the United States 
        shall conduct an annual audit of the Combined Fund. Such audit 
        shall include--
                    ``(A) a review of the progress the Combined Fund is 
                making toward a managed care system as required under 
                this subchapter, and
                    ``(B) a review of the use of, and necessity for, 
                amounts transferred to the Combined Fund under section 
                9705(c).
            ``(2) Report.--The Comptroller General shall report the 
        results of any audit under paragraph (1) to the Secretary of 
        the Treasury and to the appropriate committees of Congress, 
        including its recommendations (if any) as to any administrative 
        savings which may be achieved without reducing the effective 
        level of benefits under section 9703.''.
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