[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3962 Engrossed Amendment Senate (EAS)]

                  In the Senate of the United States,

                                                         June 18, 2010.
    Resolved, That the bill from the House of Representatives (H.R. 
3962) entitled ``An Act to provide affordable, quality health care for 
all Americans and reduce the growth in health care spending, and for 
other purposes.'', do pass with the following

                              AMENDMENTS:

            Strike all after the enacting clause and insert the 
      following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Preservation of Access to Care for 
Medicare Beneficiaries and Pension Relief Act of 2010''.

                       TITLE I--HEALTH PROVISIONS

SEC. 101. PHYSICIAN PAYMENT UPDATE.

    (a) In General.--Section 1848(d) of the Social Security Act (42 
U.S.C. 1395w-4(d)) is amended--
            (1) in paragraph (10), in the heading, by striking 
        ``portion'' and inserting ``January through may ''; and
            (2) by adding at the end the following new paragraph:
            ``(11) Update for june through november of 2010.--
                    ``(A) In general.--Subject to paragraphs (7)(B), 
                (8)(B), (9)(B), and (10)(B), in lieu of the update to 
                the single conversion factor established in paragraph 
                (1)(C) that would otherwise apply for 2010 for the 
                period beginning on June 1, 2010, and ending on 
                November 30, 2010, the update to the single conversion 
                factor shall be 2.2 percent.
                    ``(B) No effect on computation of conversion factor 
                for remaining portion of 2010 and subsequent years.--
                The conversion factor under this subsection shall be 
                computed under paragraph (1)(A) for the period 
                beginning on December 1, 2010, and ending on December 
                31, 2010, and for 2011 and subsequent years as if 
                subparagraph (A) had never applied.''.
    (b) Statutory Paygo.--The budgetary effects of this Act, for the 
purpose of complying with the Statutory Pay-As-You-Go Act of 2010, 
shall be determined by reference to the latest statement titled 
``Budgetary Effects of PAYGO Legislation'' for this Act, jointly 
submitted for printing in the Congressional Record by the Chairmen of 
the House and Senate Budget Committees, provided that such statement 
has been submitted prior to the vote on passage in the House acting 
first on this conference report or amendment between the Houses.

SEC. 102. CLARIFICATION OF 3-DAY PAYMENT WINDOW.

    (a) In General.--Section 1886 of the Social Security Act (42 U.S.C. 
1395ww) is amended--
            (1) by adding at the end of subsection (a)(4) the following 
        new sentence: ``In applying the first sentence of this 
        paragraph, the term `other services related to the admission' 
        includes all services that are not diagnostic services (other 
        than ambulance and maintenance renal dialysis services) for 
        which payment may be made under this title that are provided by 
        a hospital (or an entity wholly owned or operated by the 
        hospital) to a patient--
                    ``(A) on the date of the patient's inpatient 
                admission; or
                    ``(B) during the 3 days (or, in the case of a 
                hospital that is not a subsection (d) hospital, during 
                the 1 day) immediately preceding the date of such 
                admission unless the hospital demonstrates (in a form 
                and manner, and at a time, specified by the Secretary) 
                that such services are not related (as determined by 
                the Secretary) to such admission.''; and
            (2) in subsection (d)(7)--
                    (A) in subparagraph (A), by striking ``and'' at the 
                end;
                    (B) in subparagraph (B), by striking the period and 
                inserting ``, and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(C) the determination of whether services 
                provided prior to a patient's inpatient admission are 
                related to the admission (as described in subsection 
                (a)(4)).''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to services furnished on or after the date of the enactment of 
this Act.
    (c) No Reopening of Previously Bundled Claims.--
            (1) In general.--The Secretary of Health and Human Services 
        may not reopen a claim, adjust a claim, or make a payment 
        pursuant to any request for payment under title XVIII of the 
        Social Security Act, submitted by an entity (including a 
        hospital or an entity wholly owned or operated by the hospital) 
        for services described in paragraph (2) for purposes of 
        treating, as unrelated to a patient's inpatient admission, 
        services provided during the 3 days (or, in the case of a 
        hospital that is not a subsection (d) hospital, during the 1 
        day) immediately preceding the date of the patient's inpatient 
        admission.
            (2) Services described.--For purposes of paragraph (1), the 
        services described in this paragraph are other services related 
        to the admission (as described in section 1886(a)(4) of the 
        Social Security Act (42 U.S.C. 1395ww(a)(4)), as amended by 
        subsection (a)) which were previously included on a claim or 
        request for payment submitted under part A of title XVIII of 
        such Act for which a reopening, adjustment, or request for 
        payment under part B of such title, was not submitted prior to 
        the date of the enactment of this Act.
    (d) Implementation.--Notwithstanding any other provision of law, 
the Secretary of Health and Human Services may implement the provisions 
of this section (and amendments made by this section) by program 
instruction or otherwise.
    (e) Rule of Construction.--Nothing in the amendments made by this 
section shall be construed as changing the policy described in section 
1886(a)(4) of the Social Security Act (42 U.S.C. 1395ww(a)(4)), as 
applied by the Secretary of Health and Human Services before the date 
of the enactment of this Act, with respect to diagnostic services.

SEC. 103. ESTABLISH A CMS-IRS DATA MATCH TO IDENTIFY FRAUDULENT 
              PROVIDERS.

    (a) Authority To Disclose Return Information Concerning Outstanding 
Tax Debts for Purposes of Enhancing Medicare Program Integrity.--
            (1) In general.--Section 6103(l) of the Internal Revenue 
        Code of 1986 is amended by adding at the end the following new 
        paragraph:
            ``(22) Disclosure of return information to department of 
        health and human services for purposes of enhancing medicare 
        program integrity.--
                    ``(A) In general.--The Secretary shall, upon 
                written request from the Secretary of Health and Human 
                Services, disclose to officers and employees of the 
                Department of Health and Human Services return 
                information with respect to a taxpayer who has applied 
                to enroll, or reenroll, as a provider of services or 
                supplier under the Medicare program under title XVIII 
                of the Social Security Act. Such return information 
                shall be limited to--
                            ``(i) the taxpayer identity information 
                        with respect to such taxpayer;
                            ``(ii) the amount of the delinquent tax 
                        debt owed by that taxpayer; and
                            ``(iii) the taxable year to which the 
                        delinquent tax debt pertains.
                    ``(B) Restriction on disclosure.--Return 
                information disclosed under subparagraph (A) may be 
                used by officers and employees of the Department of 
                Health and Human Services for the purposes of, and to 
                the extent necessary in, establishing the taxpayer's 
                eligibility for enrollment or reenrollment in the 
                Medicare program, or in any administrative or judicial 
                proceeding relating to, or arising from, a denial of 
                such enrollment or reenrollment, or in determining the 
                level of enhanced oversight to be applied with respect 
                to such taxpayer pursuant to section 1866(j)(3) of the 
                Social Security Act.
                    ``(C) Delinquent tax debt.--For purposes of this 
                paragraph, the term `delinquent tax debt' means an 
                outstanding debt under this title for which a notice of 
                lien has been filed pursuant to section 6323, but the 
                term does not include a debt that is being paid in a 
                timely manner pursuant to an agreement under section 
                6159 or 7122, or a debt with respect to which a 
                collection due process hearing under section 6330 is 
                requested, pending, or completed and no payment is 
                required.''.
            (2) Conforming amendments.--Section 6103(p)(4) of such 
        Code, as amended by sections 1414 and 3308 of Public Law 111-
        148, in the matter preceding subparagraph (A) and in 
        subparagraph (F)(ii), is amended by striking ``or (17)'' and 
        inserting ``(17), or (22)'' each place it appears.
    (b) Secretary's Authority To Use Information From the Department of 
Treasury in Medicare Enrollments and Reenrollments.--Section 1866(j)(2) 
of the Social Security Act (42 U.S.C. 1395cc(j)), as inserted by 
section 6401(a) of Public Law 111-148, is further amended--
            (1) by redesignating subparagraph (E) as subparagraph (F); 
        and
            (2) by inserting after subparagraph (D) the following new 
        subparagraph:
                    ``(E) Use of information from the department of 
                treasury concerning tax debts.--In reviewing the 
                application of a provider of services or supplier to 
                enroll or reenroll under the program under this title, 
                the Secretary shall take into account the information 
                supplied by the Secretary of the Treasury pursuant to 
                section 6103(l)(22) of the Internal Revenue Code of 
                1986, in determining whether to deny such application 
                or to apply enhanced oversight to such provider of 
                services or supplier pursuant to paragraph (3) if the 
                Secretary determines such provider of services or 
                supplier owes such a debt.''.
    (c) Authority To Adjust Payments of Providers of Services and 
Suppliers With the Same Tax Identification Number for Medicare 
Obligations.--Section 1866(j)(6) of the Social Security Act (42 U.S.C. 
1395cc(j)(6)), as inserted by section 6401(a) of Public Law 111-148 and 
as redesignated by section 1304 of Public Law 111-152, is amended--
            (1) in the paragraph heading, by striking ``past-due'' and 
        inserting ``medicare'';
            (2) in subparagraph (A), by striking ``past-due obligations 
        described in subparagraph (B)(ii) of an'' and inserting 
        ``amount described in subparagraph (B)(ii) due from such''; and
            (3) in subparagraph (B)(ii), by striking ``a past-due 
        obligation'' and inserting ``an amount that is more than the 
        amount required to be paid''.

                    TITLE II--PENSION FUNDING RELIEF

                   Subtitle A--Single Employer Plans

SEC. 201. EXTENDED PERIOD FOR SINGLE-EMPLOYER DEFINED BENEFIT PLANS TO 
              AMORTIZE CERTAIN SHORTFALL AMORTIZATION BASES.

    (a) Amendments to ERISA.--
            (1) In general.--Paragraph (2) of section 303(c) of the 
        Employee Retirement Income Security Act of 1974 (29 U.S.C. 
        1083(c)) is amended by adding at the end the following 
        subparagraph:
                    ``(D) Special election for eligible plan years.--
                            ``(i) In general.--If a plan sponsor elects 
                        to apply this subparagraph with respect to the 
                        shortfall amortization base of a plan for any 
                        eligible plan year (in this subparagraph and 
                        paragraph (7) referred to as an `election 
                        year'), then, notwithstanding subparagraphs (A) 
                        and (B)--
                                    ``(I) the shortfall amortization 
                                installments with respect to such base 
                                shall be determined under clause (ii) 
                                or (iii), whichever is specified in the 
                                election, and
                                    ``(II) the shortfall amortization 
                                installment for any plan year in the 9-
                                plan-year period described in clause 
                                (ii) or the 15-plan-year period 
                                described in clause (iii), 
                                respectively, with respect to such 
                                shortfall amortization base is the 
                                annual installment determined under the 
                                applicable clause for that year for 
                                that base.
                            ``(ii) 2 plus 7 amortization schedule.--The 
                        shortfall amortization installments determined 
                        under this clause are--
                                    ``(I) in the case of the first 2 
                                plan years in the 9-plan-year period 
                                beginning with the election year, 
                                interest on the shortfall amortization 
                                base of the plan for the election year 
                                (determined using the effective 
                                interest rate for the plan for the 
                                election year), and
                                    ``(II) in the case of the last 7 
                                plan years in such 9-plan-year period, 
                                the amounts necessary to amortize the 
                                remaining balance of the shortfall 
                                amortization base of the plan for the 
                                election year in level annual 
                                installments over such last 7 plan 
                                years (using the segment rates under 
                                subparagraph (C) for the election 
                                year).
                            ``(iii) 15-year amortization.--The 
                        shortfall amortization installments determined 
                        under this subparagraph are the amounts 
                        necessary to amortize the shortfall 
                        amortization base of the plan for the election 
                        year in level annual installments over the 15-
                        plan-year period beginning with the election 
                        year (using the segment rates under 
                        subparagraph (C) for the election year).
                            ``(iv) Election.--
                                    ``(I) In general.--The plan sponsor 
                                of a plan may elect to have this 
                                subparagraph apply to not more than 2 
                                eligible plan years with respect to the 
                                plan, except that in the case of a plan 
                                described in section 106 of the Pension 
                                Protection Act of 2006, the plan 
                                sponsor may only elect to have this 
                                subparagraph apply to a plan year 
                                beginning in 2011.
                                    ``(II) Amortization schedule.--Such 
                                election shall specify whether the 
                                amortization schedule under clause (ii) 
                                or (iii) shall apply to an election 
                                year, except that if a plan sponsor 
                                elects to have this subparagraph apply 
                                to 2 eligible plan years, the plan 
                                sponsor must elect the same schedule 
                                for both years.
                                    ``(III) Other rules.--Such election 
                                shall be made at such time, and in such 
                                form and manner, as shall be prescribed 
                                by the Secretary of the Treasury, and 
                                may be revoked only with the consent of 
                                the Secretary of the Treasury. The 
                                Secretary of the Treasury shall, before 
                                granting a revocation request, provide 
                                the Pension Benefit Guaranty 
                                Corporation an opportunity to comment 
                                on the conditions applicable to the 
                                treatment of any portion of the 
                                election year shortfall amortization 
                                base that remains unamortized as of the 
                                revocation date.
                            ``(v) Eligible plan year.--For purposes of 
                        this subparagraph, the term `eligible plan 
                        year' means any plan year beginning in 2008, 
                        2009, 2010, or 2011, except that a plan year 
                        shall only be treated as an eligible plan year 
                        if the due date under subsection (j)(1) for the 
                        payment of the minimum required contribution 
                        for such plan year occurs on or after the date 
                        of the enactment of this subparagraph.
                            ``(vi) Reporting.--A plan sponsor of a plan 
                        who makes an election under clause (i) shall--
                                    ``(I) give notice of the election 
                                to participants and beneficiaries of 
                                the plan, and
                                    ``(II) inform the Pension Benefit 
                                Guaranty Corporation of such election 
                                in such form and manner as the Director 
                                of the Pension Benefit Guaranty 
                                Corporation may prescribe.
                            ``(vii) Increases in required installments 
                        in certain cases.--For increases in required 
                        contributions in cases of excess compensation 
                        or extraordinary dividends or stock 
                        redemptions, see paragraph (7).''.
            (2) Increases in required installments in certain cases.--
        Section 303(c) of the Employee Retirement Income Security Act 
        of 1974 (29 U.S.C. 1083(c)) is amended by adding at the end the 
        following paragraph:
            ``(7) Increases in alternate required installments in cases 
        of excess compensation or extraordinary dividends or stock 
        redemptions.--
                    ``(A) In general.--If there is an installment 
                acceleration amount with respect to a plan for any plan 
                year in the restriction period with respect to an 
                election year under paragraph (2)(D), then the 
                shortfall amortization installment otherwise determined 
                and payable under such paragraph for such plan year 
                shall, subject to the limitation under subparagraph 
                (B), be increased by such amount.
                    ``(B) Total installments limited to shortfall 
                base.--Subject to rules prescribed by the Secretary of 
                the Treasury, if a shortfall amortization installment 
                with respect to any shortfall amortization base for an 
                election year is required to be increased for any plan 
                year under subparagraph (A)--
                            ``(i) such increase shall not result in the 
                        amount of such installment exceeding the 
                        present value of such installment and all 
                        succeeding installments with respect to such 
                        base (determined without regard to such 
                        increase but after application of clause (ii)), 
                        and
                            ``(ii) subsequent shortfall amortization 
                        installments with respect to such base shall, 
                        in reverse order of the otherwise required 
                        installments, be reduced to the extent 
                        necessary to limit the present value of such 
                        subsequent shortfall amortization installments 
                        (after application of this paragraph) to the 
                        present value of the remaining unamortized 
                        shortfall amortization base.
                    ``(C) Installment acceleration amount.--For 
                purposes of this paragraph--
                            ``(i) In general.--The term `installment 
                        acceleration amount' means, with respect to any 
                        plan year in a restriction period with respect 
                        to an election year, the sum of--
                                    ``(I) the aggregate amount of 
                                excess employee compensation determined 
                                under subparagraph (D) with respect to 
                                all employees for the plan year, plus
                                    ``(II) the aggregate amount of 
                                extraordinary dividends and redemptions 
                                determined under subparagraph (E) for 
                                the plan year.
                            ``(ii) Annual limitation.--The installment 
                        acceleration amount for any plan year shall not 
                        exceed the excess (if any) of--
                                    ``(I) the sum of the shortfall 
                                amortization installments for the plan 
                                year and all preceding plan years in 
                                the amortization period elected under 
                                paragraph (2)(D) with respect to the 
                                shortfall amortization base with 
                                respect to an election year, determined 
                                without regard to paragraph (2)(D) and 
                                this paragraph, over
                                    ``(II) the sum of the shortfall 
                                amortization installments for such plan 
                                year and all such preceding plan years, 
                                determined after application of 
                                paragraph (2)(D) (and in the case of 
                                any preceding plan year, after 
                                application of this paragraph).
                            ``(iii) Carryover of excess installment 
                        acceleration amounts.--
                                    ``(I) In general.--If the 
                                installment acceleration amount for any 
                                plan year (determined without regard to 
                                clause (ii)) exceeds the limitation 
                                under clause (ii), then, subject to 
                                subclause (II), such excess shall be 
                                treated as an installment acceleration 
                                amount with respect to the succeeding 
                                plan year.
                                    ``(II) Cap to apply.--If any amount 
                                treated as an installment acceleration 
                                amount under subclause (I) or this 
                                subclause with respect any succeeding 
                                plan year, when added to other 
                                installment acceleration amounts 
                                (determined without regard to clause 
                                (ii)) with respect to the plan year, 
                                exceeds the limitation under clause 
                                (ii), the portion of such amount 
                                representing such excess shall be 
                                treated as an installment acceleration 
                                amount with respect to the next 
                                succeeding plan year.
                                    ``(III) Limitation on years to 
                                which amounts carried for.--No amount 
                                shall be carried under subclause (I) or 
                                (II) to a plan year which begins after 
                                the first plan year following the last 
                                plan year in the restriction period (or 
                                after the second plan year following 
                                such last plan year in the case of an 
                                election year with respect to which 15-
                                year amortization was elected under 
                                paragraph (2)(D)).
                                    ``(IV) Ordering rules.--For 
                                purposes of applying subclause (II), 
                                installment acceleration amounts for 
                                the plan year (determined without 
                                regard to any carryover under this 
                                clause) shall be applied first against 
                                the limitation under clause (ii) and 
                                then carryovers to such plan year shall 
                                be applied against such limitation on a 
                                first-in, first-out basis.
                    ``(D) Excess employee compensation.--For purposes 
                of this paragraph--
                            ``(i) In general.--The term `excess 
                        employee compensation' means, with respect to 
                        any employee for any plan year, the excess (if 
                        any) of--
                                    ``(I) the aggregate amount 
                                includible in income under chapter 1 of 
                                the Internal Revenue Code of 1986 for 
                                remuneration during the calendar year 
                                in which such plan year begins for 
                                services performed by the employee for 
                                the plan sponsor (whether or not 
                                performed during such calendar year), 
                                over
                                    ``(II) $1,000,000.
                            ``(ii) Amounts set aside for nonqualified 
                        deferred compensation.--If during any calendar 
                        year assets are set aside or reserved (directly 
                        or indirectly) in a trust (or other arrangement 
                        as determined by the Secretary of the 
                        Treasury), or transferred to such a trust or 
                        other arrangement, by a plan sponsor for 
                        purposes of paying deferred compensation of an 
                        employee under a nonqualified deferred 
                        compensation plan (as defined in section 409A 
                        of such Code) of the plan sponsor, then, for 
                        purposes of clause (i), the amount of such 
                        assets shall be treated as remuneration of the 
                        employee includible in income for the calendar 
                        year unless such amount is otherwise includible 
                        in income for such year. An amount to which the 
                        preceding sentence applies shall not be taken 
                        into account under this paragraph for any 
                        subsequent calendar year.
                            ``(iii) Only remuneration for certain post-
                        2009 services counted.--Remuneration shall be 
                        taken into account under clause (i) only to the 
                        extent attributable to services performed by 
                        the employee for the plan sponsor after 
                        February 28, 2010.
                            ``(iv) Exception for certain equity 
                        payments.--
                                    ``(I) In general.--There shall not 
                                be taken into account under clause 
                                (i)(I) any amount includible in income 
                                with respect to the granting after 
                                February 28, 2010, of service recipient 
                                stock (within the meaning of section 
                                409A of the Internal Revenue Code of 
                                1986) that, upon such grant, is subject 
                                to a substantial risk of forfeiture (as 
                                defined under section 83(c)(1) of such 
                                Code) for at least 5 years from the 
                                date of such grant.
                                    ``(II) Secretarial authority.--The 
                                Secretary of the Treasury may by 
                                regulation provide for the application 
                                of this clause in the case of a person 
                                other than a corporation.
                            ``(v) Other exceptions.--The following 
                        amounts includible in income shall not be taken 
                        into account under clause (i)(I):
                                    ``(I) Commissions.--Any 
                                remuneration payable on a commission 
                                basis solely on account of income 
                                directly generated by the individual 
                                performance of the individual to whom 
                                such remuneration is payable.
                                    ``(II) Certain payments under 
                                existing contracts.--Any remuneration 
                                consisting of nonqualified deferred 
                                compensation, restricted stock, stock 
                                options, or stock appreciation rights 
                                payable or granted under a written 
                                binding contract that was in effect on 
                                March 1, 2010, and which was not 
                                modified in any material respect before 
                                such remuneration is paid.
                            ``(vi) Self-employed individual treated as 
                        employee.--The term `employee' includes, with 
                        respect to a calendar year, a self-employed 
                        individual who is treated as an employee under 
                        section 401(c) of such Code for the taxable 
                        year ending during such calendar year, and the 
                        term `compensation' shall include earned income 
                        of such individual with respect to such self-
                        employment.
                            ``(vii) Indexing of amount.--In the case of 
                        any calendar year beginning after 2010, the 
                        dollar amount under clause (i)(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) of such Code for the calendar 
                                year, determined by substituting 
                                `calendar year 2009' for `calendar year 
                                1992' in subparagraph (B) thereof.
                        If the amount of any increase under clause (i) 
                        is not a multiple of $1,000, such increase 
                        shall be rounded to the next lowest multiple of 
                        $1,000.
                    ``(E) Extraordinary dividends and redemptions.--
                            ``(i) In general.--The amount determined 
                        under this subparagraph for any plan year is 
                        the excess (if any) of the sum of the dividends 
                        declared during the plan year by the plan 
                        sponsor plus the aggregate amount paid for the 
                        redemption of stock of the plan sponsor 
                        redeemed during the plan year over the greater 
                        of--
                                    ``(I) the adjusted net income 
                                (within the meaning of section 4043) of 
                                the plan sponsor for the preceding plan 
                                year, determined without regard to any 
                                reduction by reason of interest, taxes, 
                                depreciation, or amortization, or
                                    ``(II) in the case of a plan 
                                sponsor that determined and declared 
                                dividends in the same manner for at 
                                least 5 consecutive years immediately 
                                preceding such plan year, the aggregate 
                                amount of dividends determined and 
                                declared for such plan year using such 
                                manner.
                            ``(ii) Only certain post-2009 dividends and 
                        redemptions counted.--For purposes of clause 
                        (i), there shall only be taken into account 
                        dividends declared, and redemptions occurring, 
                        after February 28, 2010.
                            ``(iii) Exception for intra-group 
                        dividends.--Dividends paid by one member of a 
                        controlled group (as defined in section 
                        302(d)(3)) to another member of such group 
                        shall not be taken into account under clause 
                        (i).
                            ``(iv) Exception for certain redemptions.--
                        Redemptions that are made pursuant to a plan 
                        maintained with respect to employees, or that 
                        are made on account of the death, disability, 
                        or termination of employment of an employee or 
                        shareholder, shall not be taken into account 
                        under clause (i).
                            ``(v) Exception for certain preferred 
                        stock.--
                                    ``(I) In general.--Dividends and 
                                redemptions with respect to applicable 
                                preferred stock shall not be taken into 
                                account under clause (i) to the extent 
                                that dividends accrue with respect to 
                                such stock at a specified rate in all 
                                events and without regard to the plan 
                                sponsor's income, and interest accrues 
                                on any unpaid dividends with respect to 
                                such stock.
                                    ``(II) Applicable preferred 
                                stock.--For purposes of subclause (I), 
                                the term `applicable preferred stock' 
                                means preferred stock which was issued 
                                before March 1, 2010 (or which was 
                                issued after such date and is held by 
                                an employee benefit plan subject to the 
                                provisions of this title).
                    ``(F) Other definitions and rules.--For purposes of 
                this paragraph--
                            ``(i) Plan sponsor.--The term ` plan 
                        sponsor' includes any member of the plan 
                        sponsor's controlled group (as defined in 
                        section 302(d)(3)).
                            ``(ii) Restriction period.--The term 
                        `restriction period' means, with respect to any 
                        election year--
                                    ``(I) except as provided in 
                                subclause (II), the 3-year period 
                                beginning with the election year (or, 
                                if later, the first plan year beginning 
                                after December 31, 2009), and
                                    ``(II) if the plan sponsor elects 
                                15-year amortization for the shortfall 
                                amortization base for the election 
                                year, the 5-year period beginning with 
                                the election year (or, if later, the 
                                first plan year beginning after 
                                December 31, 2009).
                            ``(iii) Elections for multiple plans.--If a 
                        plan sponsor makes elections under paragraph 
                        (2)(D) with respect to 2 or more plans, the 
                        Secretary of the Treasury shall provide rules 
                        for the application of this paragraph to such 
                        plans, including rules for the ratable 
                        allocation of any installment acceleration 
                        amount among such plans on the basis of each 
                        plan's relative reduction in the plan's 
                        shortfall amortization installment for the 
                        first plan year in the amortization period 
                        described in subparagraph (A) (determined 
                        without regard to this paragraph).
                            ``(iv) Mergers and acquisitions.--The 
                        Secretary of the Treasury shall prescribe rules 
                        for the application of paragraph (2)(D) and 
                        this paragraph in any case where there is a 
                        merger or acquisition involving a plan sponsor 
                        making the election under paragraph (2)(D).''.
            (3) Conforming amendments.--Section 303 of such Act (29 
        U.S.C. 1083) is amended--
                    (A) in subsection (c)(1), by striking ``the 
                shortfall amortization bases for such plan year and 
                each of the 6 preceding plan years'' and inserting 
                ``any shortfall amortization base which has not been 
                fully amortized under this subsection'', and
                    (B) in subsection (j)(3), by adding at the end the 
                following:
                    ``(F) Quarterly contributions not to include 
                certain increased contributions.--Subparagraph (D) 
                shall be applied without regard to any increase under 
                subsection (c)(7).''.
    (b) Amendments to Internal Revenue Code of 1986.--
            (1) In general.--Paragraph (2) of section 430(c) is amended 
        by adding at the end the following subparagraph:
                    ``(D) Special election for eligible plan years.--
                            ``(i) In general.--If a plan sponsor elects 
                        to apply this subparagraph with respect to the 
                        shortfall amortization base of a plan for any 
                        eligible plan year (in this subparagraph and 
                        paragraph (7) referred to as an `election 
                        year'), then, notwithstanding subparagraphs (A) 
                        and (B)--
                                    ``(I) the shortfall amortization 
                                installments with respect to such base 
                                shall be determined under clause (ii) 
                                or (iii), whichever is specified in the 
                                election, and
                                    ``(II) the shortfall amortization 
                                installment for any plan year in the 9-
                                plan-year period described in clause 
                                (ii) or the 15-plan-year period 
                                described in clause (iii), 
                                respectively, with respect to such 
                                shortfall amortization base is the 
                                annual installment determined under the 
                                applicable clause for that year for 
                                that base.
                            ``(ii) 2 plus 7 amortization schedule.--The 
                        shortfall amortization installments determined 
                        under this clause are--
                                    ``(I) in the case of the first 2 
                                plan years in the 9-plan-year period 
                                beginning with the election year, 
                                interest on the shortfall amortization 
                                base of the plan for the election year 
                                (determined using the effective 
                                interest rate for the plan for the 
                                election year), and
                                    ``(II) in the case of the last 7 
                                plan years in such 9-plan-year period, 
                                the amounts necessary to amortize the 
                                remaining balance of the shortfall 
                                amortization base of the plan for the 
                                election year in level annual 
                                installments over such last 7 plan 
                                years (using the segment rates under 
                                subparagraph (C) for the election 
                                year).
                            ``(iii) 15-year amortization.--The 
                        shortfall amortization installments determined 
                        under this subparagraph are the amounts 
                        necessary to amortize the shortfall 
                        amortization base of the plan for the election 
                        year in level annual installments over the 15-
                        plan-year period beginning with the election 
                        year (using the segment rates under 
                        subparagraph (C) for the election year).
                            ``(iv) Election.--
                                    ``(I) In general.--The plan sponsor 
                                of a plan may elect to have this 
                                subparagraph apply to not more than 2 
                                eligible plan years with respect to the 
                                plan, except that in the case of a plan 
                                described in section 106 of the Pension 
                                Protection Act of 2006, the plan 
                                sponsor may only elect to have this 
                                subparagraph apply to a plan year 
                                beginning in 2011.
                                    ``(II) Amortization schedule.--Such 
                                election shall specify whether the 
                                amortization schedule under clause (ii) 
                                or (iii) shall apply to an election 
                                year, except that if a plan sponsor 
                                elects to have this subparagraph apply 
                                to 2 eligible plan years, the plan 
                                sponsor must elect the same schedule 
                                for both years.
                                    ``(III) Other rules.--Such election 
                                shall be made at such time, and in such 
                                form and manner, as shall be prescribed 
                                by the Secretary, and may be revoked 
                                only with the consent of the Secretary. 
                                The Secretary shall, before granting a 
                                revocation request, provide the Pension 
                                Benefit Guaranty Corporation an 
                                opportunity to comment on the 
                                conditions applicable to the treatment 
                                of any portion of the election year 
                                shortfall amortization base that 
                                remains unamortized as of the 
                                revocation date.
                            ``(v) Eligible plan year.--For purposes of 
                        this subparagraph, the term `eligible plan 
                        year' means any plan year beginning in 2008, 
                        2009, 2010, or 2011, except that a plan year 
                        shall only be treated as an eligible plan year 
                        if the due date under subsection (j)(1) for the 
                        payment of the minimum required contribution 
                        for such plan year occurs on or after the date 
                        of the enactment of this subparagraph.
                            ``(vi) Reporting.--A plan sponsor of a plan 
                        who makes an election under clause (i) shall--
                                    ``(I) give notice of the election 
                                to participants and beneficiaries of 
                                the plan, and
                                    ``(II) inform the Pension Benefit 
                                Guaranty Corporation of such election 
                                in such form and manner as the Director 
                                of the Pension Benefit Guaranty 
                                Corporation may prescribe.
                            ``(vii) Increases in required installments 
                        in certain cases.--For increases in required 
                        contributions in cases of excess compensation 
                        or extraordinary dividends or stock 
                        redemptions, see paragraph (7).''.
            (2) Increases in required contributions if excess 
        compensation paid.--Section 430(c) is amended by adding at the 
        end the following paragraph:
            ``(7) Increases in alternate required installments in cases 
        of excess compensation or extraordinary dividends or stock 
        redemptions.--
                    ``(A) In general.--If there is an installment 
                acceleration amount with respect to a plan for any plan 
                year in the restriction period with respect to an 
                election year under paragraph (2)(D), then the 
                shortfall amortization installment otherwise determined 
                and payable under such paragraph for such plan year 
                shall, subject to the limitation under subparagraph 
                (B), be increased by such amount.
                    ``(B) Total installments limited to shortfall 
                base.--Subject to rules prescribed by the Secretary, if 
                a shortfall amortization installment with respect to 
                any shortfall amortization base for an election year is 
                required to be increased for any plan year under 
                subparagraph (A)--
                            ``(i) such increase shall not result in the 
                        amount of such installment exceeding the 
                        present value of such installment and all 
                        succeeding installments with respect to such 
                        base (determined without regard to such 
                        increase but after application of clause (ii)), 
                        and
                            ``(ii) subsequent shortfall amortization 
                        installments with respect to such base shall, 
                        in reverse order of the otherwise required 
                        installments, be reduced to the extent 
                        necessary to limit the present value of such 
                        subsequent shortfall amortization installments 
                        (after application of this paragraph) to the 
                        present value of the remaining unamortized 
                        shortfall amortization base.
                    ``(C) Installment acceleration amount.--For 
                purposes of this paragraph--
                            ``(i) In general.--The term `installment 
                        acceleration amount' means, with respect to any 
                        plan year in a restriction period with respect 
                        to an election year, the sum of--
                                    ``(I) the aggregate amount of 
                                excess employee compensation determined 
                                under subparagraph (D) with respect to 
                                all employees for the plan year, plus
                                    ``(II) the aggregate amount of 
                                extraordinary dividends and redemptions 
                                determined under subparagraph (E) for 
                                the plan year.
                            ``(ii) Annual limitation.--The installment 
                        acceleration amount for any plan year shall not 
                        exceed the excess (if any) of--
                                    ``(I) the sum of the shortfall 
                                amortization installments for the plan 
                                year and all preceding plan years in 
                                the amortization period elected under 
                                paragraph (2)(D) with respect to the 
                                shortfall amortization base with 
                                respect to an election year, determined 
                                without regard to paragraph (2)(D) and 
                                this paragraph, over
                                    ``(II) the sum of the shortfall 
                                amortization installments for such plan 
                                year and all such preceding plan years, 
                                determined after application of 
                                paragraph (2)(D) (and in the case of 
                                any preceding plan year, after 
                                application of this paragraph).
                            ``(iii) Carryover of excess installment 
                        acceleration amounts.--
                                    ``(I) In general.--If the 
                                installment acceleration amount for any 
                                plan year (determined without regard to 
                                clause (ii)) exceeds the limitation 
                                under clause (ii), then, subject to 
                                subclause (II), such excess shall be 
                                treated as an installment acceleration 
                                amount with respect to the succeeding 
                                plan year.
                                    ``(II) Cap to apply.--If any amount 
                                treated as an installment acceleration 
                                amount under subclause (I) or this 
                                subclause with respect any succeeding 
                                plan year, when added to other 
                                installment acceleration amounts 
                                (determined without regard to clause 
                                (ii)) with respect to the plan year, 
                                exceeds the limitation under clause 
                                (ii), the portion of such amount 
                                representing such excess shall be 
                                treated as an installment acceleration 
                                amount with respect to the next 
                                succeeding plan year.
                                    ``(III) Limitation on years to 
                                which amounts carried for.--No amount 
                                shall be carried under subclause (I) or 
                                (II) to a plan year which begins after 
                                the first plan year following the last 
                                plan year in the restriction period (or 
                                after the second plan year following 
                                such last plan year in the case of an 
                                election year with respect to which 15-
                                year amortization was elected under 
                                paragraph (2)(D)).
                                    ``(IV) Ordering rules.--For 
                                purposes of applying subclause (II), 
                                installment acceleration amounts for 
                                the plan year (determined without 
                                regard to any carryover under this 
                                clause) shall be applied first against 
                                the limitation under clause (ii) and 
                                then carryovers to such plan year shall 
                                be applied against such limitation on a 
                                first-in, first-out basis.
                    ``(D) Excess employee compensation.--For purposes 
                of this paragraph--
                            ``(i) In general.--The term `excess 
                        employee compensation' means, with respect to 
                        any employee for any plan year, the excess (if 
                        any) of--
                                    ``(I) the aggregate amount 
                                includible in income under this chapter 
                                for remuneration during the calendar 
                                year in which such plan year begins for 
                                services performed by the employee for 
                                the plan sponsor (whether or not 
                                performed during such calendar year), 
                                over
                                    ``(II) $1,000,000.
                            ``(ii) Amounts set aside for nonqualified 
                        deferred compensation.--If during any calendar 
                        year assets are set aside or reserved (directly 
                        or indirectly) in a trust (or other arrangement 
                        as determined by the Secretary), or transferred 
                        to such a trust or other arrangement, by a plan 
                        sponsor for purposes of paying deferred 
                        compensation of an employee under a 
                        nonqualified deferred compensation plan (as 
                        defined in section 409A) of the plan sponsor, 
                        then, for purposes of clause (i), the amount of 
                        such assets shall be treated as remuneration of 
                        the employee includible in income for the 
                        calendar year unless such amount is otherwise 
                        includible in income for such year. An amount 
                        to which the preceding sentence applies shall 
                        not be taken into account under this paragraph 
                        for any subsequent calendar year.
                            ``(iii) Only remuneration for certain post-
                        2009 services counted.--Remuneration shall be 
                        taken into account under clause (i) only to the 
                        extent attributable to services performed by 
                        the employee for the plan sponsor after 
                        February 28, 2010.
                            ``(iv) Exception for certain equity 
                        payments.--
                                    ``(I) In general.--There shall not 
                                be taken into account under clause 
                                (i)(I) any amount includible in income 
                                with respect to the granting after 
                                February 28, 2010, of service recipient 
                                stock (within the meaning of section 
                                409A) that, upon such grant, is subject 
                                to a substantial risk of forfeiture (as 
                                defined under section 83(c)(1)) for at 
                                least 5 years from the date of such 
                                grant.
                                    ``(II) Secretarial authority.--The 
                                Secretary may by regulation provide for 
                                the application of this clause in the 
                                case of a person other than a 
                                corporation.
                            ``(v) Other exceptions.--The following 
                        amounts includible in income shall not be taken 
                        into account under clause (i)(I):
                                    ``(I) Commissions.--Any 
                                remuneration payable on a commission 
                                basis solely on account of income 
                                directly generated by the individual 
                                performance of the individual to whom 
                                such remuneration is payable.
                                    ``(II) Certain payments under 
                                existing contracts.--Any remuneration 
                                consisting of nonqualified deferred 
                                compensation, restricted stock, stock 
                                options, or stock appreciation rights 
                                payable or granted under a written 
                                binding contract that was in effect on 
                                March 1, 2010, and which was not 
                                modified in any material respect before 
                                such remuneration is paid.
                            ``(vi) Self-employed individual treated as 
                        employee.--The term `employee' includes, with 
                        respect to a calendar year, a self-employed 
                        individual who is treated as an employee under 
                        section 401(c) for the taxable year ending 
                        during such calendar year, and the term 
                        `compensation' shall include earned income of 
                        such individual with respect to such self-
                        employment.
                            ``(vii) Indexing of amount.--In the case of 
                        any calendar year beginning after 2010, the 
                        dollar amount under clause (i)(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 2009' for `calendar year 1992' in 
                                subparagraph (B) thereof.
                        If the amount of any increase under clause (i) 
                        is not a multiple of $1,000, such increase 
                        shall be rounded to the next lowest multiple of 
                        $1,000.
                    ``(E) Extraordinary dividends and redemptions.--
                            ``(i) In general.--The amount determined 
                        under this subparagraph for any plan year is 
                        the excess (if any) of the sum of the dividends 
                        declared during the plan year by the plan 
                        sponsor plus the aggregate amount paid for the 
                        redemption of stock of the plan sponsor 
                        redeemed during the plan year over the greater 
                        of--
                                    ``(I) the adjusted net income 
                                (within the meaning of section 4043 of 
                                the Employee Retirement Income Security 
                                Act of 1974) of the plan sponsor for 
                                the preceding plan year, determined 
                                without regard to any reduction by 
                                reason of interest, taxes, 
                                depreciation, or amortization, or
                                    ``(II) in the case of a plan 
                                sponsor that determined and declared 
                                dividends in the same manner for at 
                                least 5 consecutive years immediately 
                                preceding such plan year, the aggregate 
                                amount of dividends determined and 
                                declared for such plan year using such 
                                manner.
                            ``(ii) Only certain post-2009 dividends and 
                        redemptions counted.--For purposes of clause 
                        (i), there shall only be taken into account 
                        dividends declared, and redemptions occurring, 
                        after February 28, 2010.
                            ``(iii) Exception for intra-group 
                        dividends.--Dividends paid by one member of a 
                        controlled group (as defined in section 
                        412(d)(3)) to another member of such group 
                        shall not be taken into account under clause 
                        (i).
                            ``(iv) Exception for certain redemptions.--
                        Redemptions that are made pursuant to a plan 
                        maintained with respect to employees, or that 
                        are made on account of the death, disability, 
                        or termination of employment of an employee or 
                        shareholder, shall not be taken into account 
                        under clause (i).
                            ``(v) Exception for certain preferred 
                        stock.--
                                    ``(I) In general.--Dividends and 
                                redemptions with respect to applicable 
                                preferred stock shall not be taken into 
                                account under clause (i) to the extent 
                                that dividends accrue with respect to 
                                such stock at a specified rate in all 
                                events and without regard to the plan 
                                sponsor's income, and interest accrues 
                                on any unpaid dividends with respect to 
                                such stock.
                                    ``(II) Applicable preferred 
                                stock.--For purposes of subclause (I), 
                                the term `applicable preferred stock' 
                                means preferred stock which was issued 
                                before March 1, 2010 (or which was 
                                issued after such date and is held by 
                                an employee benefit plan subject to the 
                                provisions of title I of Employee 
                                Retirement Income Security Act of 
                                1974).
                    ``(F) Other definitions and rules.--For purposes of 
                this paragraph--
                            ``(i) Plan sponsor.--The term ` plan 
                        sponsor' includes any member of the plan 
                        sponsor's controlled group (as defined in 
                        section 412(d)(3)).
                            ``(ii) Restriction period.--The term 
                        `restriction period' means, with respect to any 
                        election year--
                                    ``(I) except as provided in 
                                subclause (II), the 3-year period 
                                beginning with the election year (or, 
                                if later, the first plan year beginning 
                                after December 31, 2009), and
                                    ``(II) if the plan sponsor elects 
                                15-year amortization for the shortfall 
                                amortization base for the election 
                                year, the 5-year period beginning with 
                                the election year (or, if later, the 
                                first plan year beginning after 
                                December 31, 2009).
                            ``(iii) Elections for multiple plans.--If a 
                        plan sponsor makes elections under paragraph 
                        (2)(D) with respect to 2 or more plans, the 
                        Secretary shall provide rules for the 
                        application of this paragraph to such plans, 
                        including rules for the ratable allocation of 
                        any installment acceleration amount among such 
                        plans on the basis of each plan's relative 
                        reduction in the plan's shortfall amortization 
                        installment for the first plan year in the 
                        amortization period described in subparagraph 
                        (A) (determined without regard to this 
                        paragraph).
                            ``(iv) Mergers and acquisitions.--The 
                        Secretary shall prescribe rules for the 
                        application of paragraph (2)(D) and this 
                        paragraph in any case where there is a merger 
                        or acquisition involving a plan sponsor making 
                        the election under paragraph (2)(D).''.
            (3) Conforming amendments.--Section 430 is amended--
                    (A) in subsection (c)(1), by striking ``the 
                shortfall amortization bases for such plan year and 
                each of the 6 preceding plan years'' and inserting 
                ``any shortfall amortization base which has not been 
                fully amortized under this subsection'', and
                    (B) in subsection (j)(3), by adding at the end the 
                following:
                    ``(F) Quarterly contributions not to include 
                certain increased contributions.--Subparagraph (D) 
                shall be applied without regard to any increase under 
                subsection (c)(7).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after December 31, 2007.

SEC. 202. APPLICATION OF EXTENDED AMORTIZATION PERIOD TO PLANS SUBJECT 
              TO PRIOR LAW FUNDING RULES.

    (a) In General.--Title I of the Pension Protection Act of 2006 is 
amended by redesignating section 107 as section 108 and by inserting 
the following after section 106:

``SEC. 107. APPLICATION OF EXTENDED AMORTIZATION PERIODS TO PLANS WITH 
              DELAYED EFFECTIVE DATE.

    ``(a) In General.--If the plan sponsor of a plan to which section 
104, 105, or 106 of this Act applies elects to have this section apply 
for any eligible plan year (in this section referred to as an `election 
year'), section 302 of the Employee Retirement Income Security Act of 
1974 and section 412 of the Internal Revenue Code of 1986 (as in effect 
before the amendments made by this subtitle and subtitle B) shall apply 
to such year in the manner described in subsection (b) or (c), 
whichever is specified in the election. All references in this section 
to `such Act' or `such Code' shall be to such Act or such Code as in 
effect before the amendments made by this subtitle and subtitle B.
    ``(b) Application of 2 and 7 Rule.--In the case of an election year 
to which this subsection applies--
            ``(1) 2-year lookback for determining deficit reduction 
        contributions for certain plans.--For purposes of applying 
        section 302(d)(9) of such Act and section 412(l)(9) of such 
        Code, the funded current liability percentage (as defined in 
        subparagraph (C) thereof) for such plan for such plan year 
        shall be such funded current liability percentage of such plan 
        for the second plan year preceding the first election year of 
        such plan.
            ``(2) Calculation of deficit reduction contribution.--For 
        purposes of applying section 302(d) of such Act and section 
        412(l) of such Code to a plan to which such sections apply 
        (after taking into account paragraph (1))--
                    ``(A) in the case of the increased unfunded new 
                liability of the plan, the applicable percentage 
                described in section 302(d)(4)(C) of such Act and 
                section 412(l)(4)(C) of such Code shall be the third 
                segment rate described in sections 104(b), 105(b), and 
                106(b) of this Act, and
                    ``(B) in the case of the excess of the unfunded new 
                liability over the increased unfunded new liability, 
                such applicable percentage shall be determined without 
                regard to this section.
    ``(c) Application of 15-year Amortization.--In the case of an 
election year to which this subsection applies, for purposes of 
applying section 302(d) of such Act and section 412(l) of such Code--
            ``(1) in the case of the increased unfunded new liability 
        of the plan, the applicable percentage described in section 
        302(d)(4)(C) of such Act and section 412(l)(4)(C) of such Code 
        for any pre-effective date plan year beginning with or after 
        the first election year shall be the ratio of--
                    ``(A) the annual installments payable in each year 
                if the increased unfunded new liability for such plan 
                year were amortized over 15 years, using an interest 
                rate equal to the third segment rate described in 
                sections 104(b), 105(b), and 106(b) of this Act, to
                    ``(B) the increased unfunded new liability for such 
                plan year, and
            ``(2) in the case of the excess of the unfunded new 
        liability over the increased unfunded new liability, such 
        applicable percentage shall be determined without regard to 
        this section.
    ``(d) Election.--
            ``(1) In general.--The plan sponsor of a plan may elect to 
        have this section apply to not more than 2 eligible plan years 
        with respect to the plan, except that in the case of a plan to 
        which section 106 of this Act applies, the plan sponsor may 
        only elect to have this section apply to 1 eligible plan year.
            ``(2) Amortization schedule.--Such election shall specify 
        whether the rules under subsection (b) or (c) shall apply to an 
        election year, except that if a plan sponsor elects to have 
        this section apply to 2 eligible plan years, the plan sponsor 
        must elect the same rule for both years.
            ``(3) Other rules.--Such election shall be made at such 
        time, and in such form and manner, as shall be prescribed by 
        the Secretary of the Treasury, and may be revoked only with the 
        consent of the Secretary of the Treasury.
    ``(e) Definitions.--For purposes of this section--
            ``(1) Eligible plan year.--For purposes of this 
        subparagraph, the term `eligible plan year' means any plan year 
        beginning in 2008, 2009, 2010, or 2011, except that a plan year 
        beginning in 2008 shall only be treated as an eligible plan 
        year if the due date for the payment of the minimum required 
        contribution for such plan year occurs on or after the date of 
        the enactment of this clause.
            ``(2) Pre-effective date plan year.--The term `pre-
        effective date plan year' means, with respect to a plan, any 
        plan year prior to the first year in which the amendments made 
        by this subtitle and subtitle B apply to the plan.
            ``(3) Increased unfunded new liability.--The term 
        `increased unfunded new liability' means, with respect to a 
        year, the excess (if any) of the unfunded new liability over 
        the amount of unfunded new liability determined as if the value 
        of the plan's assets determined under subsection 302(c)(2) of 
        such Act and section 412(c)(2) of such Code equaled the product 
        of the current liability of the plan for the year multiplied by 
        the funded current liability percentage (as defined in section 
        302(d)(8)(B) of such Act and 412(l)(8)(B) of such Code) of the 
        plan for the second plan year preceding the first election year 
        of such plan.
            ``(4) Other definitions.--The terms `unfunded new 
        liability' and `current liability' shall have the meanings set 
        forth in section 302(d) of such Act and section 412(l) of such 
        Code.''.
    (b) Eligible Charity Plans.--Section 104 of the Pension Protection 
Act of 2006 is amended--
            (1) by striking ``eligible cooperative plan'' wherever it 
        appears in subsections (a) and (b) and inserting ``eligible 
        cooperative plan or an eligible charity plan'', and
            (2) by adding at the end the following new subsection:
    ``(d) Eligible Charity Plan Defined.--For purposes of this section, 
a plan shall be treated as an eligible charity plan for a plan year if 
the plan is maintained by more than one employer (determined without 
regard to section 414(c) of the Internal Revenue Code) and 100 percent 
of the employers are described in section 501(c)(3) of such Code.''.
    (c) Effective Date.--
            (1) In general.--The amendment made by subsection (a) shall 
        take effect as if included in the Pension Protection Act of 
        2006.
            (2) Eligible charity plan.--The amendments made by 
        subsection (b) shall apply to plan years beginning after 
        December 31, 2007, except that a plan sponsor may elect to 
        apply such amendments to plan years beginning after December 
        31, 2008. Any such election shall be made at such time, and in 
        such form and manner, as shall be prescribed by the Secretary 
        of the Treasury, and may be revoked only with the consent of 
        the Secretary of the Treasury.

SEC. 203. LOOKBACK FOR CERTAIN BENEFIT RESTRICTIONS.

    (a) In General.--
            (1) Amendment to erisa.--Section 206(g)(9) of the Employee 
        Retirement Income Security Act of 1974 is amended by adding at 
        the end the following:
                    ``(D) Special rule for certain years.--Solely for 
                purposes of any applicable provision--
                            ``(i) In general.--For plan years beginning 
                        on or after October 1, 2008, and before October 
                        1, 2010, the adjusted funding target attainment 
                        percentage of a plan shall be the greater of--
                                    ``(I) such percentage, as 
                                determined without regard to this 
                                subparagraph, or
                                    ``(II) the adjusted funding target 
                                attainment percentage for such plan for 
                                the plan year beginning after October 
                                1, 2007, and before October 1, 2008, as 
                                determined under rules prescribed by 
                                the Secretary of the Treasury.
                            ``(ii) Special rule.--In the case of a plan 
                        for which the valuation date is not the first 
                        day of the plan year--
                                    ``(I) clause (i) shall apply to 
                                plan years beginning after December 31, 
                                2007, and before January 1, 2010, and
                                    ``(II) clause (i)(II) shall apply 
                                based on the last plan year beginning 
                                before November 1, 2007, as determined 
                                under rules prescribed by the Secretary 
                                of the Treasury.
                            ``(iii) Applicable provision.--For purposes 
                        of this subparagraph, the term `applicable 
                        provision' means--
                                    ``(I) paragraph (3), but only for 
                                purposes of applying such paragraph to 
                                a payment which, as determined under 
                                rules prescribed by the Secretary of 
                                the Treasury, is a payment under a 
                                social security leveling option which 
                                accelerates payments under the plan 
                                before, and reduces payments after, a 
                                participant starts receiving social 
                                security benefits in order to provide 
                                substantially similar aggregate 
                                payments both before and after such 
                                benefits are received, and
                                    ``(II) paragraph (4).''.
            (2) Amendment to internal revenue code of 1986.--Section 
        436(j) of the Internal Revenue Code of 1986 is amended by 
        adding at the end the following:
            ``(3) Special rule for certain years.--Solely for purposes 
        of any applicable provision--
                    ``(A) In general.--For plan years beginning on or 
                after October 1, 2008, and before October 1, 2010, the 
                adjusted funding target attainment percentage of a plan 
                shall be the greater of--
                            ``(i) such percentage, as determined 
                        without regard to this paragraph, or
                            ``(ii) the adjusted funding target 
                        attainment percentage for such plan for the 
                        plan year beginning after October 1, 2007, and 
                        before October 1, 2008, as determined under 
                        rules prescribed by the Secretary.
                    ``(B) Special rule.--In the case of a plan for 
                which the valuation date is not the first day of the 
                plan year--
                            ``(i) subparagraph (A) shall apply to plan 
                        years beginning after December 31, 2007, and 
                        before January 1, 2010, and
                            ``(ii) subparagraph (A)(ii) shall apply 
                        based on the last plan year beginning before 
                        November 1, 2007, as determined under rules 
                        prescribed by the Secretary.
                    ``(C) Applicable provision.--For purposes of this 
                paragraph, the term `applicable provision' means--
                            ``(i) subsection (d), but only for purposes 
                        of applying such paragraph to a payment which, 
                        as determined under rules prescribed by the 
                        Secretary, is a payment under a social security 
                        leveling option which accelerates payments 
                        under the plan before, and reduces payments 
                        after, a participant starts receiving social 
                        security benefits in order to provide 
                        substantially similar aggregate payments both 
                        before and after such benefits are received, 
                        and
                            ``(ii) subsection (e).''.
    (b) Interaction With Wrera Rule.--Section 203 of the Worker, 
Retiree, and Employer Recovery Act of 2008 shall apply to a plan for 
any plan year in lieu of the amendments made by this section applying 
to sections 206(g)(4) of the Employee Retirement Income Security Act of 
1974 and 436(e) of the Internal Revenue Code of 1986 only to the extent 
that such section produces a higher adjusted funding target attainment 
percentage for such plan for such year.
    (c) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to plan years 
        beginning on or after October 1, 2008.
            (2) Special rule.--In the case of a plan for which the 
        valuation date is not the first day of the plan year, the 
        amendments made by this section shall apply to plan years 
        beginning after December 31, 2007.

SEC. 204. LOOKBACK FOR CREDIT BALANCE RULE FOR PLANS MAINTAINED BY 
              CHARITIES.

    (a) Amendment to Erisa.--Paragraph (3) of section 303(f) of the 
Employee Retirement Income Security Act of 1974 is amended by adding 
the following at the end thereof:
                    ``(D) Special rule for certain years of plans 
                maintained by charities.--
                            ``(i) In general.--For purposes of applying 
                        subparagraph (C) for plan years beginning after 
                        August 31, 2009, and before September 1, 2011, 
                        the ratio determined under such subparagraph 
                        for the preceding plan year shall be the 
                        greater of--
                                    ``(I) such ratio, as determined 
                                without regard to this subparagraph, or
                                    ``(II) the ratio for such plan for 
                                the plan year beginning after August 
                                31, 2007, and before September 1, 2008, 
                                as determined under rules prescribed by 
                                the Secretary of the Treasury.
                            ``(ii) Special rule.--In the case of a plan 
                        for which the valuation date is not the first 
                        day of the plan year--
                                    ``(I) clause (i) shall apply to 
                                plan years beginning after December 31, 
                                2008, and before January 1, 2011, and
                                    ``(II) clause (i)(II) shall apply 
                                based on the last plan year beginning 
                                before September 1, 2007, as determined 
                                under rules prescribed by the Secretary 
                                of the Treasury.
                            ``(iii) Limitation to charities.--This 
                        subparagraph shall not apply to any plan unless 
                        such plan is maintained exclusively by one or 
                        more organizations described in section 
                        501(c)(3) of the Internal Revenue Code of 
                        1986.''.
    (b) Amendment to Internal Revenue Code of 1986.--Paragraph (3) of 
section 430(f) of the Internal Revenue Code of 1986 is amended by 
adding the following at the end thereof:
                    ``(D) Special rule for certain years of plans 
                maintained by charities.--
                            ``(i) In general.--For purposes of applying 
                        subparagraph (C) for plan years beginning after 
                        August 31, 2009, and before September 1, 2011, 
                        the ratio determined under such subparagraph 
                        for the preceding plan year of a plan shall be 
                        the greater of--
                                    ``(I) such ratio, as determined 
                                without regard to this subsection, or
                                    ``(II) the ratio for such plan for 
                                the plan year beginning after August 
                                31, 2007 and before September 1, 2008, 
                                as determined under rules prescribed by 
                                the Secretary.
                            ``(ii) Special rule.--In the case of a plan 
                        for which the valuation date is not the first 
                        day of the plan year--
                                    ``(I) clause (i) shall apply to 
                                plan years beginning after December 31, 
                                2007, and before January 1, 2010, and
                                    ``(II) clause (i)(II) shall apply 
                                based on the last plan year beginning 
                                before September 1, 2007, as determined 
                                under rules prescribed by the 
                                Secretary.
                            ``(iii) Limitation to charities.--This 
                        subparagraph shall not apply to any plan unless 
                        such plan is maintained exclusively by one or 
                        more organizations described in section 
                        501(c)(3).''.
    (c) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to plan years 
        beginning after August 31, 2009.
            (2) Special rule.--In the case of a plan for which the 
        valuation date is not the first day of the plan year, the 
        amendments made by this section shall apply to plan years 
        beginning after December 31, 2008.

                    Subtitle B--Multiemployer Plans

SEC. 211. ADJUSTMENTS TO FUNDING STANDARD ACCOUNT RULES.

    (a) Adjustments.--
            (1) Amendment to erisa.--Section 304(b) of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1084(b)) is 
        amended by adding at the end the following new paragraph:
            ``(8) Special relief rules.--Notwithstanding any other 
        provision of this subsection--
                    ``(A) Amortization of net investment losses.--
                            ``(i) In general.--A multiemployer plan 
                        with respect to which the solvency test under 
                        subparagraph (C) is met may treat the portion 
                        of any experience loss or gain attributable to 
                        net investment losses incurred in either or 
                        both of the first two plan years ending after 
                        August 31, 2008, as an item separate from other 
                        experience losses, to be amortized in equal 
                        annual installments (until fully amortized) 
                        over the period --
                                    ``(I) beginning with the plan year 
                                in which such portion is first 
                                recognized in the actuarial value of 
                                assets, and
                                    ``(II) ending with the last plan 
                                year in the 30-plan year period 
                                beginning with the plan year in which 
                                such net investment loss was incurred.
                            ``(ii) Coordination with extensions.--If 
                        this subparagraph applies for any plan year--
                                    ``(I) no extension of the 
                                amortization period under clause (i) 
                                shall be allowed under subsection (d), 
                                and
                                    ``(II) if an extension was granted 
                                under subsection (d) for any plan year 
                                before the election to have this 
                                subparagraph apply to the plan year, 
                                such extension shall not result in such 
                                amortization period exceeding 30 years.
                            ``(iii) Net investment losses.--For 
                        purposes of this subparagraph--
                                    ``(I) In general.--Net investment 
                                losses shall be determined in the 
                                manner prescribed by the Secretary of 
                                the Treasury on the basis of the 
                                difference between actual and expected 
                                returns (including any difference 
                                attributable to any criminally 
                                fraudulent investment arrangement).
                                    ``(II) Criminally fraudulent 
                                investment arrangements.--The 
                                determination as to whether an 
                                arrangement is a criminally fraudulent 
                                investment arrangement shall be made 
                                under rules substantially similar to 
                                the rules prescribed by the Secretary 
                                of the Treasury for purposes of section 
                                165 of the Internal Revenue Code of 
                                1986.
                    ``(B) Expanded smoothing period.--
                            ``(i) In general.--A multiemployer plan 
                        with respect to which the solvency test under 
                        subparagraph (C) is met may change its asset 
                        valuation method in a manner which--
                                    ``(I) spreads the difference 
                                between expected and actual returns for 
                                either or both of the first 2 plan 
                                years ending after August 31, 2008, 
                                over a period of not more than 10 
                                years,
                                    ``(II) provides that for either or 
                                both of the first 2 plan years 
                                beginning after August 31, 2008, the 
                                value of plan assets at any time shall 
                                not be less than 80 percent or greater 
                                than 130 percent of the fair market 
                                value of such assets at such time, or
                                    ``(III) makes both changes 
                                described in subclauses (I) and (II) to 
                                such method.
                            ``(ii) Asset valuation methods.--If this 
                        subparagraph applies for any plan year--
                                    ``(I) the Secretary of the Treasury 
                                shall not treat the asset valuation 
                                method of the plan as unreasonable 
                                solely because of the changes in such 
                                method described in clause (i), and
                                    ``(II) such changes shall be deemed 
                                approved by such Secretary under 
                                section 302(d)(1) and section 412(d)(1) 
                                of such Code.
                            ``(iii) Amortization of reduction in 
                        unfunded accrued liability.--If this 
                        subparagraph and subparagraph (A) both apply 
                        for any plan year, the plan shall treat any 
                        reduction in unfunded accrued liability 
                        resulting from the application of this 
                        subparagraph as a separate experience 
                        amortization base, to be amortized in equal 
                        annual installments (until fully amortized) 
                        over a period of 30 plan years rather than the 
                        period such liability would otherwise be 
                        amortized over.
                    ``(C) Solvency test.--The solvency test under this 
                paragraph is met only if the plan actuary certifies 
                that the plan is projected to have sufficient assets to 
                timely pay expected benefits and anticipated 
                expenditures over the amortization period, taking into 
                account the changes in the funding standard account 
                under this paragraph.
                    ``(D) Restriction on benefit increases.--If 
                subparagraph (A) or (B) apply to a multiemployer plan 
                for any plan year, then, in addition to any other 
                applicable restrictions on benefit increases, a plan 
                amendment increasing benefits may not go into effect 
                during either of the 2 plan years immediately following 
                such plan year unless--
                            ``(i) the plan actuary certifies that--
                                    ``(I) any such increase is paid for 
                                out of additional contributions not 
                                allocated to the plan immediately 
                                before the application of this 
                                paragraph to the plan, and
                                    ``(II) the plan's funded percentage 
                                and projected credit balances for such 
                                2 plan years are reasonably expected to 
                                be at least as high as such percentage 
                                and balances would have been if the 
                                benefit increase had not been adopted, 
                                or
                            ``(ii) the amendment is required as a 
                        condition of qualification under part I of 
                        subchapter D of chapter 1 of the Internal 
                        Revenue Code of 1986 or to comply with other 
                        applicable law.
                    ``(E) Reporting.--A plan sponsor of a plan to which 
                this paragraph applies shall--
                            ``(i) give notice of such application to 
                        participants and beneficiaries of the plan, and
                            ``(ii) inform the Pension Benefit Guaranty 
                        Corporation of such application in such form 
                        and manner as the Director of the Pension 
                        Benefit Guaranty Corporation may prescribe.''.
            (2) Amendment to internal revenue code of 1986.--Section 
        431(b) is amended by adding at the end the following new 
        paragraph:
            ``(8) Special relief rules.--Notwithstanding any other 
        provision of this subsection--
                    ``(A) Amortization of net investment losses.--
                            ``(i) In general.--A multiemployer plan 
                        with respect to which the solvency test under 
                        subparagraph (C) is met may treat the portion 
                        of any experience loss or gain attributable to 
                        net investment losses incurred in either or 
                        both of the first two plan years ending after 
                        August 31, 2008, as an item separate from other 
                        experience losses, to be amortized in equal 
                        annual installments (until fully amortized) 
                        over the period --
                                    ``(I) beginning with the plan year 
                                in which such portion is first 
                                recognized in the actuarial value of 
                                assets, and
                                    ``(II) ending with the last plan 
                                year in the 30-plan year period 
                                beginning with the plan year in which 
                                such net investment loss was incurred.
                            ``(ii) Coordination with extensions.--If 
                        this subparagraph applies for any plan year--
                                    ``(I) no extension of the 
                                amortization period under clause (i) 
                                shall be allowed under subsection (d), 
                                and
                                    ``(II) if an extension was granted 
                                under subsection (d) for any plan year 
                                before the election to have this 
                                subparagraph apply to the plan year, 
                                such extension shall not result in such 
                                amortization period exceeding 30 years.
                            ``(iii) Net investment losses.--For 
                        purposes of this subparagraph--
                                    ``(I) In general.--Net investment 
                                losses shall be determined in the 
                                manner prescribed by the Secretary on 
                                the basis of the difference between 
                                actual and expected returns (including 
                                any difference attributable to any 
                                criminally fraudulent investment 
                                arrangement).
                                    ``(II) Criminally fraudulent 
                                investment arrangements.--The 
                                determination as to whether an 
                                arrangement is a criminally fraudulent 
                                investment arrangement shall be made 
                                under rules substantially similar to 
                                the rules prescribed by the Secretary 
                                for purposes of section 165.
                    ``(B) Expanded smoothing period.--
                            ``(i) In general.--A multiemployer plan 
                        with respect to which the solvency test under 
                        subparagraph (C) is met may change its asset 
                        valuation method in a manner which--
                                    ``(I) spreads the difference 
                                between expected and actual returns for 
                                either or both of the first 2 plan 
                                years ending after August 31, 2008, 
                                over a period of not more than 10 
                                years,
                                    ``(II) provides that for either or 
                                both of the first 2 plan years 
                                beginning after August 31, 2008, the 
                                value of plan assets at any time shall 
                                not be less than 80 percent or greater 
                                than 130 percent of the fair market 
                                value of such assets at such time, or
                                    ``(III) makes both changes 
                                described in subclauses (I) and (II) to 
                                such method.
                            ``(ii) Asset valuation methods.--If this 
                        subparagraph applies for any plan year--
                                    ``(I) the Secretary shall not treat 
                                the asset valuation method of the plan 
                                as unreasonable solely because of the 
                                changes in such method described in 
                                clause (i), and
                                    ``(II) such changes shall be deemed 
                                approved by the Secretary under section 
                                302(d)(1) of the Employee Retirement 
                                Income Security Act of 1974 and section 
                                412(d)(1).
                            ``(iii) Amortization of reduction in 
                        unfunded accrued liability.--If this 
                        subparagraph and subparagraph (A) both apply 
                        for any plan year, the plan shall treat any 
                        reduction in unfunded accrued liability 
                        resulting from the application of this 
                        subparagraph as a separate experience 
                        amortization base, to be amortized in equal 
                        annual installments (until fully amortized) 
                        over a period of 30 plan years rather than the 
                        period such liability would otherwise be 
                        amortized over.
                    ``(C) Solvency test.--The solvency test under this 
                paragraph is met only if the plan actuary certifies 
                that the plan is projected to have sufficient assets to 
                timely pay expected benefits and anticipated 
                expenditures over the amortization period, taking into 
                account the changes in the funding standard account 
                under this paragraph.
                    ``(D) Restriction on benefit increases.--If 
                subparagraph (A) or (B) apply to a multiemployer plan 
                for any plan year, then, in addition to any other 
                applicable restrictions on benefit increases, a plan 
                amendment increasing benefits may not go into effect 
                during either of the 2 plan years immediately following 
                such plan year unless--
                            ``(i) the plan actuary certifies that--
                                    ``(I) any such increase is paid for 
                                out of additional contributions not 
                                allocated to the plan immediately 
                                before the application of this 
                                paragraph to the plan, and
                                    ``(II) the plan's funded percentage 
                                and projected credit balances for such 
                                2 plan years are reasonably expected to 
                                be at least as high as such percentage 
                                and balances would have been if the 
                                benefit increase had not been adopted, 
                                or
                            ``(ii) the amendment is required as a 
                        condition of qualification under part I of 
                        subchapter D or to comply with other applicable 
                        law.
                    ``(E) Reporting.--A plan sponsor of a plan to which 
                this paragraph applies shall--
                            ``(i) give notice of such application to 
                        participants and beneficiaries of the plan, and
                            ``(ii) inform the Pension Benefit Guaranty 
                        Corporation of such application in such form 
                        and manner as the Director of the Pension 
                        Benefit Guaranty Corporation may prescribe.''.
    (b) Effective Dates.--
            (1) In general.--The amendments made by this section shall 
        take effect as of the first day of the first plan year ending 
        after August 31, 2008, except that any election a plan makes 
        pursuant to this section that affects the plan's funding 
        standard account for the first plan year beginning after August 
        31, 2008, shall be disregarded for purposes of applying the 
        provisions of section 305 of the Employee Retirement Income 
        Security Act of 1974 and section 432 of the Internal Revenue 
        Code of 1986 to such plan year.
            (2) Restrictions on benefit increases.--Notwithstanding 
        paragraph (1), the restrictions on plan amendments increasing 
        benefits in sections 304(b)(8)(D) of such Act and 431(b)(8)(D) 
        of such Code, as added by this section, shall take effect on 
        the date of enactment of this Act.

                    TITLE III--BUDGETARY PROVISIONS

SEC. 301. BUDGETARY PROVISIONS.

    The budgetary effects of this Act, for the purpose of complying 
with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by 
reference to the latest statement titled ``Budgetary Effects of PAYGO 
Legislation'' for this Act, submitted for printing in the Congressional 
Record by the Chairman of the Senate Budget Committee, provided that 
such statement has been submitted prior to the vote on passage.

            Amend the title so as to read: ``An Act to provide a 
        physician payment update, to provide pension funding relief, 
        and for other purposes.''.

            Attest:

                                                             Secretary.
111th CONGRESS

  2d Session

                               H.R. 3962

_______________________________________________________________________

                               AMENDMENTS