[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 426 Introduced in Senate (IS)]
111th CONGRESS
1st Session
S. 426
To amend title II of the Social Security Act to provide for progressive
indexing and longevity indexing of Social Security old-age insurance
benefits for newly retired and aged surviving spouses to ensure the
future solvency of the Social Security program, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 12, 2009
Mr. Bennett introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend title II of the Social Security Act to provide for progressive
indexing and longevity indexing of Social Security old-age insurance
benefits for newly retired and aged surviving spouses to ensure the
future solvency of the Social Security program, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Social Security Solvency Act of
2009''.
SEC. 2. PROGRESSIVE INDEXING OF BENEFITS FOR OLD-AGE INSURANCE
BENEFITS.
(a) In General.--Section 215(a) of the Social Security Act (42
U.S.C. 415(a)) is amended--
(1) by striking ``The'' in paragraph (1)(A) and inserting
``With respect to any benefit other than an applicable benefit
to which paragraph (2) applies, the'', and
(2) by redesignating paragraphs (2) through (7) as
paragraphs (3) through (8), respectively, and by inserting
after paragraph (1) the following new paragraph:
``(2)(A) In the case of an applicable benefit with respect to any
individual who initially becomes eligible for old-age insurance
benefits or who dies (before becoming eligible for such benefits) in
calendar year 2012 or later, the primary insurance amount of the
individual shall be equal to the sum of--
``(i) 90 percent of the individual's average indexed
monthly earning (determined under subsection (b)) to the extent
that such earnings do not exceed the amount established for
purposes of paragraph (1)(A)(i) by paragraph (1)(B);
``(ii) 32 percent of the individual's average indexed
monthly earnings to the extent that such earnings exceed the
amount established for purposes of paragraph (1)(A)(i) by
paragraph (1)(B) but do not exceed the amount established for
purposes of this clause by subparagraph (B);
``(iii) 32 percent (reduced as provided in subparagraph
(C)) of the individual's average indexed monthly earnings to
the extent that such earnings exceed the amount established for
purposes of clause (ii) but do not exceed the amount
established for purposes of paragraph (1)(A)(ii) by paragraph
(1)(B); and
``(iv) 15 percent (reduced as provided in subparagraph (C))
of the individual's average indexed monthly earnings to the
extent that such earnings exceed the amount established for
purposes of paragraph (1)(A)(ii) by paragraph (1)(B).
``(B)(i) For purposes of subparagraph (A)(ii), the amount
established under this subparagraph for calendar year 2012 shall be the
level of average indexed monthly earnings determined by the Chief
Actuary of the Social Security Administration under clause (ii) as
being at the 30th percentile for the period of calendar years 2001
through 2003.
``(ii) For purposes of clause (i), the average indexed monthly
earnings for the period of calendar years 2001 through 2003 shall be
determined by--
``(I) determining the average indexed monthly earnings for
each individual who initially became eligible for old-age
insurance benefits or who died (before becoming eligible for
such benefits) during such period, except that in determining
such average indexed monthly earnings under subsection (b),
subsection (b)(3)(A)(ii)(I) shall be applied by substituting
calendar year 2000 for the second calendar year described in
such subsection; and
``(II) multiplying the amount determined for each
individual under subclause (I) by the quotient obtained by
dividing the national average wage index (as defined in section
209(k)(1)) for the calendar year 2010 by such index for the
calendar year 2000.
``(iii) For purposes of subparagraph (A)(ii), the amount
established under this subparagraph for any calendar year after 2012
shall be equal to the product of the amount in effect under clause (i)
with respect to calendar year 2012 and the quotient obtained by
dividing--
``(I) the national average wage index (as defined in
section 209(k)(1)) for the second calendar year preceding the
calendar year for which the determination is being made, by
``(II) the national average wage index (as so defined) for
2010.
``(iv) The amount established under this subparagraph for any
calendar year shall be rounded to the nearest $1, except that any
amount so established which is a multiple of $0.50 but not of $1 shall
be rounded to the next higher $1.
``(C)(i) Except as provided in clause (ii), in the case of any
calendar year after 2011, each of the percentages to which this
subparagraph applies by reason of clauses (iii) or (iv) of subparagraph
(A) shall be a percentage equal to such percentage multiplied by the
quotient obtained by dividing--
``(I) the difference of the maximum CPI-indexed benefit
amount for such year over the amount determined under this
paragraph for an individual whose average indexed monthly
earnings are equal to the amount established for purposes of
subparagraph (A)(ii) for such year, by
``(II) the difference of the maximum wage-indexed benefit
amount for such year over the amount determined under this
paragraph for an individual whose average indexed monthly
earnings are equal to the amount established for purposes of
subparagraph (A)(ii) for such year.
``(ii)(I) In the case of any calendar year which is a positive
balance year, clause (i) shall not apply and each of the percentages to
which this subparagraph applies by reason of clause (iii) or (iv) of
subparagraph (B) shall be a percentage equal to the percentage
determined under this subparagraph for the preceding year (determined
after the application of this subparagraph).
``(II) In the case of any calendar year after a positive balance
year which is not a positive balance year, this subparagraph shall be
applied by substituting `the second calendar year preceding the most
recent positive balance year' for `2009' each place it appears in
clause (iv).
``(iii) For purposes of clause (i), the maximum wage-indexed
benefit amount for any calendar year shall be equal to the amount
determined under this paragraph (determined without regard to any
reduction under this subparagraph) for an individual with wages paid in
and self-employment income credited to each computation base year in an
amount equal to the contribution and benefit base for each calendar
year.
``(iv) For purposes of clause (i), the maximum CPI-indexed benefit
amount for any calendar year shall be an amount equal to the amount
determined under clause (iii) for such year multiplied by a fraction--
``(I) the numerator of which is the ratio (rounded to the
nearest one-thousandth of 1 percent) of the Consumer Price
Index for the second preceding year to such index for 2009; and
``(II) the denominator of which is the ratio (rounded to
the nearest one-thousandth of 1 percent) of the national wage
index (as defined in section 209(k)(1)) for the second year
preceding such year to such index for 2009.
``(v)(I) For purposes of clause (i), a positive balance year is a
calendar year following any calendar year after 2050 for which the
Chief Actuary of the Social Security Administration certifies to the
Secretary of the Treasury and the Congress that the combined balance
ratio of the Federal Old-Age and Survivors Trust Fund and the Federal
Disability Insurance Trust Fund is not less than 100 percent for such
year.
``(II) For purposes of subclause (I), the combined balance ratio of
the Federal Old-Age and Survivors Trust Fund and the Federal Disability
Insurance Trust Fund for any calendar year is the ratio of the combined
balance of such Trust Funds as of the last day of such calendar year
(reduced by any transfer made pursuant to section 201(o) in such
calendar year) to the amount estimated by the Commissioner of Social
Security under section 201(l)(3)(B)(iii)(II) to be paid from such Trust
Funds during the calendar year following such calendar year for all
purposes authorized by section 201 (determined as if such following
calendar year were a positive balance year).
``(D) For purposes of this paragraph, rules similar to the rules of
subparagraphs (C) and (D) of paragraph (1) shall apply.
``(E) For purposes of this paragraph, the term `applicable benefit'
means any benefit under section 202 other than--
``(i) a child's insurance benefit under section 202(d) with
respect to a child of an individual who has died;
``(ii) a widow's insurance benefit under section 202(e)
with respect to a widow who has not attained age 60 and is
under a disability (as defined in section 223(d)) which began
before the end of the period specified in section 202(e)(4);
``(iii) a widower's insurance benefit under section 202(f)
with respect to a widower who has not attained age 60 and is
under a disability (as defined in section 223(d)) which began
before the end of the period specified in section 202(f)(4);
and
``(iv) a mother's and father's insurance benefit under
section 202(g).''.
(b) Conforming Amendments.--
(1) Subsections (e)(2)(B)(i)(I) and (f)(2)(B)(i)(I) of
section 202 of the Social Security Act are each amended by
inserting ``or section 215(a)(2)(B)(iii)'' after ``section
215(a)(1)(B)(i) and (ii)''.
(2) Section 203(a)(1) of such Act is amended--
(A) in subparagraph (A)(i), by striking
``215(a)(2)(B)(i)'' and inserting ``215(a)(3)(B)(i)'';
(B) in subparagraph (A)(ii), by striking
``215(a)(2)(C)'' and inserting ``215(a)(3)(C)''; and
(C) in subparagraph (B)(ii), by striking
``215(a)(2)'' and inserting ``215(a)(3)''.
(3) Section 209(k)(1) of such Act is amended by inserting
``215(a)(2)(B), 215(a)(2)(C),'' after ``215(a)(1)(D),''.
(4) Section 215(a) of such Act is amended--
(A) in paragraph (4)(A), as redesignated by
paragraph (2), by striking ``paragraph (4)'' and
inserting ``paragraph (5)'';
(B) in paragraph (4)(B), as redesignated by
paragraph (2), by striking ``paragraph (2)(A)'' and
inserting ``paragraph (3)(A)'';
(C) in paragraph (5), as redesignated by paragraph
(2), by striking ``paragraph (3)(A)'' and inserting
``paragraph (4)(A)'';
(D) in paragraph (6)(A), as redesignated by
paragraph (2), by striking ``paragraph (4)(B)'' and
inserting ``paragraph (5)(B)''; and
(E) in paragraph (8)(B)(ii)(I), as redesignated by
paragraph (2), by striking ``paragraph (3)(B)'' and
inserting ``paragraph (4)(B)''.
(5) Section 215(d)(3) of such Act is amended--
(A) by striking ``paragraph (4)(B)(ii)'' and
inserting ``paragraph (5)(B)(ii)''; and
(B) by striking ``subsection (a)(7)(C)'' and
inserting ``subsection (a)(8)(C)''.
(6) Subsection 215(f) of such Act is amended--
(A) in paragraph (2)(B), by striking ``subsection
(a)(4)(B)'' and inserting ``subsection (a)(5)(B)'';
(B) in paragraph (7), by striking ``subsection
(a)(6)'' and inserting ``subsection (a)(7)'';
(C) in paragraph (9)(A)--
(i) by striking ``subsection (a)(7)(A)''
and inserting ``subsection (a)(8)(A)''; and
(ii) by striking ``subsection (a)(7)(C)''
and inserting ``subsection (a)(8)(C)''; and
(D) in paragraph (9)(B), by striking ``subsection
(a)(7)'' each place it appears and inserting
``subsection (a)(8)''.
SEC. 3. MODIFICATION OF PIA FACTORS TO REFLECT CHANGES IN LIFE
EXPECTANCY.
(a) Modification.--
(1) In general.--Section 215(a)(2) of the Social Security
Act (42 U.S.C. 415(a)(2)), as added by this Act, is amended by
redesignating subparagraphs (D) and (E) as subparagraphs (E)
and (F), respectively, and by inserting after subparagraph (C)
the following new subparagraph:
``(D)(i) For individuals who initially become eligible for old-age
insurance benefits (or who die before becoming eligible for such
benefits) in any calendar year after 2017, each of the percentages used
for purposes of clauses (i), (ii), (iii), and (iv) of subparagraph (A)
(after the application of subparagraph (C) in the case of subclauses
(iii) and (iv) of subparagraph (A)) shall be multiplied by the life
expectancy ratio for such calendar year.
``(ii) The Commissioner of Social Security shall, through the Chief
Actuary of the Social Security Administration, using generally accepted
actuarial principles, determine and publish in the Federal Register on
or before November 1 of each calendar year the life expectancy ratio
for the following calendar year.
``(iii) For purposes of this subparagraph, the life expectancy
ratio for any calendar year is the ratio of--
``(I) the period life expectancy based on the computed
death rates for 2013 of an individual at age 67, to
``(II) the period life expectancy of an individual at such
age based on the computed death rates for the fourth calendar
year preceding the calendar year for which the life expectancy
ratio is determined under clause (ii).''.
(2) Conforming amendment.--Clauses (iii) and (iv) of
section 215(a)(2)(A) of the Social Security Act, as added by
this Act, are each amended by striking ``subparagraph (C)'' and
inserting ``subparagraphs (C) and (F)''.
(b) Study Regarding Life Expectancy of Disabled Beneficiaries.--
(1) In general.--The Commissioner of Social Security shall
conduct a study on the feasibility of creating a separate life
expectancy ratio under section 215(a)(2)(D) of the Social
Security Act for individuals attaining early retirement age who
are receiving disability insurance benefits under title II of
such Act on the date the individual attains such age.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, the Commissioner shall submit to
Congress a report on the results of the study under paragraph
(1).
SEC. 4. TREATMENT OF DISABLED BENEFICIARIES.
Section 215(a) of the Social Security Act (42 U.S.C. 415(a)), as
amended by sections 2 and 3, is amended by adding at the end the
following new paragraph:
``(9)(A) Notwithstanding the preceding provisions of this
subsection, in the case of an individual who has or has had a period of
disability and who initially becomes eligible for old-age insurance
benefits or who dies (before becoming eligible for such benefits) in
any calendar year in or after 2012, the primary insurance amount of
such individual shall be the sum of--
``(i) the amount determined under subparagraph (B); and
``(ii) the product derived by multiplying--
``(I) the excess of the amount determined under
subparagraph (C) over the amount determined under
subparagraph (B), by
``(II) the adjustment factor for such individual
determined under subparagraph (D).
``(B) The amount determined under this subparagraph is the amount
of such individual's primary insurance amount as determined under this
section without regard to this paragraph.
``(C) The amount determined under this subparagraph is the amount
of such individual's primary insurance amount as determined under this
section as in effect with respect to individuals becoming eligible for
old-age or disability insurance benefits under section 202(a) in 2008.
``(D) The adjustment factor determined under this subparagraph for
any individual is the ratio (not greater than 1) of--
``(i) the total number of months during which such
individual is under a disability (as defined in section 223(d))
during the period beginning on the date the individual attains
age 22 and ending on the first day of such individual's first
month of eligibility for old-age insurance benefits under
section 202(a) (or, if earlier, the month of such individual's
death), to
``(ii) the number of months during the period beginning on
the date the individual attains age 22 and ending on the first
day of such individual's first month of eligibility for old-age
insurance benefits under section 202(a) (or, if earlier, the
month of such individual's death).''.
SEC. 5. ACCELERATION OF INCREASE IN RETIREMENT AGE.
(a) Increase in Retirement Age to 67.--Section 216(l)(1) of the
Social Security Act (42 U.S.C. 416(l)(1)) is amended--
(1) in subparagraph (C), by striking ``2017'' and inserting
``2012'';
(2) in subparagraph (D), by striking ``after December 31,
2016 and before January 1, 2022'' and inserting ``after
December 31, 2011 and before January 1, 2017''; and
(3) in subparagraph (E), by striking ``2021'' and inserting
``2016''.
(b) Conforming Amendment.--Subparagraph (B) of section 216(l)(3) of
the Social Security Act (42 U.S.C. 416(l)(3)(B)) is amended--
(1) by striking ``calendar years 2017 through 2021'' and
inserting ``calendar years 2012 through 2016''; and
(2) by striking ``January 2017'' and inserting ``January
2012''.
SEC. 6. MAINTENANCE OF ADEQUATE BALANCES IN THE SOCIAL SECURITY TRUST
FUNDS.
(a) In General.--Section 201 of the Social Security Act (42 U.S.C.
401) is amended by adding at the end the following new subsection:
``(o) In addition to amounts otherwise appropriated under the
preceding provisions of this section to the Trust Funds established
under this section, there is hereby appropriated for each fiscal year
to each of such Trust Funds, from amounts in the general fund of the
Treasury not otherwise appropriated, such sums as may be necessary from
time to time to maintain the balance ratio (as defined in section
709(b)) of such Trust Fund, for the calendar year commencing during
such fiscal year, at not less than 100 percent. The sums to be
appropriated under the preceding sentence shall be determined by the
Commissioner of Social Security and certified by the Commissioner to
each House of the Congress not later than October 1 of such fiscal
year. In making such determination and certification, the Commissioner
shall use the intermediate actuarial assumptions used by the Board of
Trustees of the Trust Funds in its most recent annual report to the
Congress prepared pursuant to subsection (c)(2). The Commissioner shall
also transmit a copy of any such certification to the Secretary of the
Treasury, and upon receipt thereof, such Secretary shall promptly take
appropriate actions in accordance with the certification.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to fiscal years beginning after the date of the
enactment of this Act.
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