[Congressional Record Volume 146, Number 111 (Tuesday, September 19, 2000)]
[House]
[Pages H7780-H7798]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
DEBT RELIEF AND RETIREMENT SECURITY RECONCILIATION ACT
Mr. SHAW. Mr. Speaker, I move to suspend the rules and pass the bill
(H.R. 5203) to provide for reconciliation pursuant to sections
103(a)(2), 103(b)(2), and 213(b)(2)(C) of the concurrent resolution on
the budget for fiscal year 2001 to reduce the public debt and decrease
the statutory limit on the public debt, and to amend the Internal
Revenue Code of 1986 to provide for retirement security.
The Clerk read as follows:
H.R. 5203
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Debt
Relief and Retirement Security Reconciliation Act''.
(b) Table of Contents.--The table of contents of this Act
is as follows:
Sec. 1. Short title, etc.
DIVISION A--DEBT RELIEF
Sec. 100. Findings and purpose.
TITLE I--DEBT REDUCTION LOCK-BOX
Sec. 101. Establishment of Public Debt Reduction Payment Account.
Sec. 102. Reduction of statutory limit on the public debt.
Sec. 103. Off-budget status of Public Debt Reduction Payment Account.
Sec. 104. Removing Public Debt Reduction Payment Account from budget
pronouncements.
Sec. 105. Reports to Congress.
TITLE II--SOCIAL SECURITY AND MEDICARE LOCK-BOX
Sec. 201. Protection of Social Security and Medicare surpluses.
Sec. 202. Removing Social Security from budget pronouncements.
DIVISION B--RETIREMENT SECURITY
TITLE XI--INDIVIDUAL RETIREMENT ACCOUNTS
Sec. 1100. References.
Sec. 1101. Modification of IRA contribution limits.
TITLE XII--EXPANDING COVERAGE
Sec. 1201. Increase in benefit and contribution limits.
Sec. 1202. Plan loans for subchapter S owners, partners, and sole
proprietors.
Sec. 1203. Modification of top-heavy rules.
Sec. 1204. Elective deferrals not taken into account for purposes of
deduction limits.
Sec. 1205. Repeal of coordination requirements for deferred
compensation plans of State and local governments and
tax-exempt organizations.
Sec. 1206. Elimination of user fee for requests to irs regarding
pension plans.
Sec. 1207. Deduction limits.
Sec. 1208. Option to treat elective deferrals as after-tax
contributions.
TITLE XIII--ENHANCING FAIRNESS FOR WOMEN
Sec. 1301. Catch-up contributions for individuals age 50 or over.
Sec. 1302. Equitable treatment for contributions of employees to
defined contribution plans.
Sec. 1303. Faster vesting of certain employer matching contributions.
Sec. 1304. Simplify and update the minimum distribution rules.
Sec. 1305. Clarification of tax treatment of division of section 457
plan benefits upon divorce.
Sec. 1306. Modification of safe harbor relief for hardship withdrawals
from cash or deferred arrangements.
TITLE XIV--INCREASING PORTABILITY FOR PARTICIPANTS
Sec. 1401. Rollovers allowed among various types of plans.
Sec. 1402. Rollovers of IRAs into workplace retirement plans.
Sec. 1403. Rollovers of after-tax contributions.
Sec. 1404. Hardship exception to 60-day rule.
Sec. 1405. Treatment of forms of distribution.
Sec. 1406. Rationalization of restrictions on distributions.
Sec. 1407. Purchase of service credit in governmental defined benefit
plans.
Sec. 1408. Employers may disregard rollovers for purposes of cash-out
amounts.
Sec. 1409. Minimum distribution and inclusion requirements for section
457 plans.
TITLE XV--STRENGTHENING PENSION SECURITY AND ENFORCEMENT
Sec. 1501. Repeal of 150 percent of current liability funding limit.
Sec. 1502. Maximum contribution deduction rules modified and applied to
all defined benefit plans.
Sec. 1503. Excise tax relief for sound pension funding.
Sec. 1504. Excise tax on failure to provide notice by defined benefit
plans significantly reducing future benefit accruals.
Sec. 1505. Treatment of multiemployer plans under section 415.
Sec. 1506. Prohibited allocations of stock in S corporation ESOP.
TITLE XVI--REDUCING REGULATORY BURDENS
Sec. 1601. Modification of timing of plan valuations.
Sec. 1602. ESOP dividends may be reinvested without loss of dividend
deduction.
Sec. 1603. Repeal of transition rule relating to certain highly
compensated employees.
Sec. 1604. Employees of tax-exempt entities.
Sec. 1605. Clarification of treatment of employer-provided retirement
advice.
Sec. 1606. Reporting simplification.
Sec. 1607. Improvement of employee plans compliance resolution system.
Sec. 1608. Repeal of the multiple use test.
Sec. 1609. Flexibility in nondiscrimination, coverage, and line of
business rules.
Sec. 1610. Extension to all governmental plans of moratorium on
application of certain nondiscrimination rules applicable
to State and local plans.
Sec. 1611. Notice and consent period regarding distributions.
TITLE XVII--PLAN AMENDMENTS
Sec. 1701. Provisions relating to plan amendments.
DIVISION A--DEBT RELIEF
SEC. 100. FINDINGS AND PURPOSE.
(a) Findings.--The Congress finds that--
(1) fiscal discipline, resulting from the Balanced Budget
Act of 1997, and strong economic growth have ended decades of
deficit spending and have produced budget surpluses without
using the social security surplus;
(2) fiscal pressures will mount in the future as the aging
of the population increases budget obligations;
(3) until Congress and the President agree to legislation
that saves social security and medicare, the social security
and medicare surpluses should be used to reduce the debt held
by the public;
(4) until Congress and the President agree on significant
tax reductions, amounts dedicated for that purpose shall be
used to reduce the debt held by the public;
(5) strengthening the Government's fiscal position through
public debt reduction increases national savings, promotes
economic growth, reduces interest costs, and is a
constructive way to prepare for the Government's future
budget obligations; and
(6) it is fiscally responsible and in the long-term
national economic interest to use a portion of the nonsocial
security and nonmedicare surpluses to reduce the debt held by
the public.
(b) Purpose.--It is the purpose of this division to--
(1) reduce the debt held by the public by $240,000,000,000
in fiscal year 2001 with the goal of eliminating this debt by
2012;
(2) decrease the statutory limit on the public debt; and
[[Page H7781]]
(3) ensure that the social security and hospital insurance
trust funds shall not be used for other purposes.
TITLE I--DEBT REDUCTION LOCK-BOX
SEC. 101. ESTABLISHMENT OF PUBLIC DEBT REDUCTION PAYMENT
ACCOUNT.
(a) In General.--Subchapter I of chapter 31 of title 31,
United States Code, is amended by adding at the end the
following new section:
``Sec. 3114. Public debt reduction payment account
``(a) There is established in the Treasury of the United
States an account to be known as the Public Debt Reduction
Payment Account (hereinafter in this section referred to as
the `account').
``(b) The Secretary of the Treasury shall use amounts in
the account to pay at maturity, or to redeem or buy before
maturity, any obligation of the Government held by the public
and included in the public debt. Any obligation which is
paid, redeemed, or bought with amounts from the account shall
be canceled and retired and may not be reissued. Amounts
deposited in the account are appropriated and may only be
expended to carry out this section.
``(c) There is hereby appropriated into the account on
October 1, 2000, or the date of enactment of this section,
whichever is later, out of any money in the Treasury not
otherwise appropriated, $42,000,000,000 for the fiscal year
ending September 30, 2001. The funds appropriated to this
account shall remain available until expended.
``(d) The appropriation made under subsection (c) shall not
be considered direct spending for purposes of section 252 of
Balanced Budget and Emergency Deficit Control Act of 1985.
``(e) Establishment of and appropriations to the account
shall not affect trust fund transfers that may be authorized
under any other provision of law.
``(f) The Secretary of the Treasury and the Director of the
Office of Management and Budget shall each take such actions
as may be necessary to promptly carry out this section in
accordance with sound debt management policies.
``(g) Reducing the debt pursuant to this section shall not
interfere with the debt management policies or goals of the
Secretary of the Treasury.''.
(b) Conforming Amendment.--The chapter analysis for chapter
31 of title 31, United States Code, is amended by inserting
after the item relating to section 3113 the following:
``3114. Public debt reduction payment account.''.
SEC. 102. REDUCTION OF STATUTORY LIMIT ON THE PUBLIC DEBT.
Section 3101(b) of title 31, United States Code, is amended
by inserting ``minus the amount appropriated into the Public
Debt Reduction Payment Account pursuant to section 3114(c)''
after ``$5,950,000,000,000''.
SEC. 103. OFF-BUDGET STATUS OF PUBLIC DEBT REDUCTION PAYMENT
ACCOUNT.
Notwithstanding any other provision of law, the receipts
and disbursements of the Public Debt Reduction Payment
Account established by section 3114 of title 31, United
States Code, shall not be counted as new budget authority,
outlays, receipts, or deficit or surplus for purposes of--
(1) the budget of the United States Government as submitted
by the President,
(2) the congressional budget, or
(3) the Balanced Budget and Emergency Deficit Control Act
of 1985.
SEC. 104. REMOVING PUBLIC DEBT REDUCTION PAYMENT ACCOUNT FROM
BUDGET PRONOUNCEMENTS.
(a) In General.--Any official statement issued by the
Office of Management and Budget, the Congressional Budget
Office, or any other agency or instrumentality of the Federal
Government of surplus or deficit totals of the budget of the
United States Government as submitted by the President or of
the surplus or deficit totals of the congressional budget,
and any description of, or reference to, such totals in any
official publication or material issued by either of such
Offices or any other such agency or instrumentality, shall
exclude the outlays and receipts of the Public Debt Reduction
Payment Account established by section 3114 of title 31,
United States Code.
(b) Separate Public Debt Reduction Payment Account Budget
Documents.--The excluded outlays and receipts of the Public
Debt Reduction Payment Account established by section 3114 of
title 31, United States Code, shall be submitted in separate
budget documents.
SEC. 105. REPORTS TO CONGRESS.
(a) Reports of the Secretary of the Treasury.--(1) Within
30 days after the appropriation is deposited into the Public
Debt Reduction Payment Account under section 3114 of title
31, United States Code, the Secretary of the Treasury shall
submit a report to the Committee on Ways and Means of the
House of Representatives and the Committee on Finance of the
Senate confirming that such account has been established and
the amount and date of such deposit. Such report shall also
include a description of the Secretary's plan for using such
money to reduce debt held by the public.
(2) Not later than October 31, 2002, the Secretary of the
Treasury shall submit a report to the Committee on Ways and
Means of the House of Representatives and the Committee on
Finance of the Senate setting forth the amount of money
deposited into the Public Debt Reduction Payment Account, the
amount of debt held by the public that was reduced, and a
description of the actual debt instruments that were redeemed
with such money.
(b) Report of the Comptroller General of the United
States.--Not later than November 15, 2002, the Comptroller
General of the United States shall submit a report to the
Committee on Ways and Means of the House of Representatives
and the Committee on Finance of the Senate verifying all of
the information set forth in the reports submitted under
subsection (a).
TITLE II--SOCIAL SECURITY AND MEDICARE LOCK-BOX
SEC. 201. PROTECTION OF SOCIAL SECURITY AND MEDICARE
SURPLUSES.
(a) Protection of Social Security and Medicare Surpluses.--
Section 201 of the concurrent resolution on the budget for
fiscal year 2001 (H. Con. Res. 290, 106th Congress) is
amended as follows:
(1) In the section heading, by inserting ``AND MEDICARE''
before ``SURPLUSES''.
(2) By striking subsection (c) and inserting the following
new subsection:
``(c) Lock-box for Social Security and Hospital Insurance
Surpluses.--
``(1) Concurrent resolutions on the budget.--It shall not
be in order in the House of Representatives or the Senate to
consider any concurrent resolution on the budget, or
conference report thereon or amendment thereto, that would
set forth a surplus for any fiscal year that is less than the
surplus of the Federal Hospital Insurance Trust Fund for that
fiscal year.
``(2) Subsequent legislation.--(A) Except as provided by
subparagraph (B), it shall not be in order in the House of
Representatives or the Senate to consider any bill, joint
resolution, amendment, motion, or conference report if--
``(i) the enactment of that bill or resolution as reported;
``(ii) the adoption and enactment of that amendment; or
``(iii) the enactment of that bill or resolution in the
form recommended in that conference report,
would cause the on-budget surplus for any fiscal year to be
less than the projected surplus of the Federal Hospital
Insurance Trust Fund (as assumed in the most recently agreed
to concurrent resolution on the budget) for that fiscal year
or increase the amount by which the on-budget surplus for any
fiscal year would be less than such trust fund surplus for
that fiscal year.
``(B) Subparagraph (A) shall not apply to social security
reform legislation or medicare reform legislation.''.
(3) By redesignating subsections (e) and (f) as subsections
(g) and (h), respectively, and inserting after subsection (d)
the following new subsections:
``(e) Content of Concurrent Resolution on the Budget.--The
concurrent resolution on the budget for each fiscal year
shall set forth appropriate levels for the fiscal year
beginning on October 1 of such year and for at least each of
the 4 ensuing fiscal years of the surplus or deficit in the
Federal Hospital Insurance Trust Fund.
``(f) Definitions.--As used in this section:
``(1) The term `medicare reform legislation' means a bill
or a joint resolution to save Medicare that includes a
provision stating the following: `For purposes of section
201(c) of the concurrent resolution on the budget for fiscal
year 2001, this Act constitutes medicare reform
legislation.'.
``(2) The term `social security reform legislation' means a
bill or a joint resolution to save social security that
includes a provision stating the following: `For purposes of
section 201(c) of the concurrent resolution on the budget for
fiscal year 2001, this Act constitutes social security reform
legislation.'.''.
(4) In the first sentence of subsection (h) (as
redesignated), by striking ``(1)''.
(5) At the end, by adding the following new subsection:
``(i) Effective Date.--This section shall cease to have
any force or effect upon the enactment of social security
reform legislation and medicare reform legislation.''.
(b) Protection of Social Security and Medicare Surpluses.--
(1) If the budget of the United States Government submitted
by the President under section 1105(a) of title 31, United
States Code, recommends an on-budget surplus for any fiscal
year that is less than the surplus of the Federal Hospital
Insurance Trust Fund for that fiscal year, then it shall
include proposed legislative language for social security
reform legislation or medicare reform legislation.
(2) Paragraph (1) shall cease to have any force or effect
upon the enactment of social security reform legislation and
medicare reform legislation as defined by section 201(g) of
the concurrent resolution on the budget for fiscal year 2001
(H. Con. Res 290, 106th Congress).
(c) Conforming Amendment.--The item relating to section 201
in the table of contents set forth in section 1(b) of the
concurrent resolution on the budget for fiscal year 2001 (H.
Con. Res 290, 106th Congress) is amended to read as follows:
``Sec. 201. Protection of social security and medicare surpluses.''.
SEC. 202. REMOVING SOCIAL SECURITY FROM BUDGET
PRONOUNCEMENTS.
(a) In General.--Any official statement issued by the
Office of Management and Budget, the Congressional Budget
Office, or any other agency or instrumentality of the Federal
Government of surplus or deficit totals of the budget of the
United States Government as submitted by the President or of
[[Page H7782]]
the surplus or deficit totals of the congressional budget,
and any description of, or reference to, such totals in any
official publication or material issued by either of such
Offices or any other such agency or instrumentality, shall
exclude the outlays and receipts of the old-age, survivors,
and disability insurance program under title II of the Social
Security Act (including the Federal Old-Age and Survivors
Insurance Trust Fund and the Federal Disability Insurance
Trust Fund) and the related provisions of the Internal
Revenue Code of 1986.
(b) Separate Social Security Budget Documents.--The
excluded outlays and receipts of the old-age, survivors, and
disability insurance program under title II of the Social
Security Act shall be submitted in separate Social Security
budget documents.
DIVISION B--RETIREMENT SECURITY
TITLE XI--INDIVIDUAL RETIREMENT ACCOUNTS
SEC. 1100. REFERENCES.
Except as otherwise expressly provided, whenever in this
division an amendment or repeal is expressed in terms of an
amendment to, or repeal of, a section or other provision, the
reference shall be considered to be made to a section or
other provision of the Internal Revenue Code of 1986.
SEC. 1101. MODIFICATION OF IRA CONTRIBUTION LIMITS.
(a) Increase in Contribution Limit.--
(1) In general.--Paragraph (1)(A) of section 219(b)
(relating to maximum amount of deduction) is amended by
striking ``$2,000'' and inserting ``the deductible amount''.
(2) Deductible amount.--Section 219(b) is amended by adding
at the end the following new paragraph:
``(5) Deductible amount.--For purposes of paragraph
(1)(A)--
``(A) In general.--The deductible amount shall be
determined in accordance with the following table:
``For taxable years The deductible
beginning in: amount is:
2001..................................................$3,000 .
2002..................................................$4,000 .
2003 and thereafter...................................$5,000..
``(B) Catch-up contributions for individuals 50 or older.--
In the case of an individual who has attained the age of 50
before the close of the taxable year, the deductible amount
for taxable years beginning in 2001 or 2002 shall be $5,000.
``(C) Cost-of-living adjustment.--
``(i) In general.--In the case of any taxable year
beginning in a calendar year after 2003, the $5,000 amount
under subparagraph (A) shall be increased by an amount equal
to--
``(I) such dollar amount, multiplied by
``(II) the cost-of-living adjustment determined under
section 1(f )(3) for the calendar year in which the taxable
year begins, determined by substituting `calendar year 2002'
for `calendar year 1992' in subparagraph (B) thereof.
``(ii) Rounding rules.--If any amount after adjustment
under clause (i) is not a multiple of $500, such amount shall
be rounded to the next lower multiple of $500.''.
(b) Conforming Amendments.--
(1) Section 408(a)(1) is amended by striking ``in excess of
$2,000 on behalf of any individual'' and inserting ``on
behalf of any individual in excess of the amount in effect
for such taxable year under section 219(b)(1)(A)''.
(2) Section 408(b)(2)(B) is amended by striking ``$2,000''
and inserting ``the dollar amount in effect under section
219(b)(1)(A)''.
(3) Section 408(b) is amended by striking ``$2,000'' in the
matter following paragraph (4) and inserting ``the dollar
amount in effect under section 219(b)(1)(A)''.
(4) Section 408( j) is amended by striking ``$2,000''.
(5) Section 408(p)(8) is amended by striking ``$2,000'' and
inserting ``the dollar amount in effect under section
219(b)(1)(A)''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2000.
TITLE XII--EXPANDING COVERAGE
SEC. 1201. INCREASE IN BENEFIT AND CONTRIBUTION LIMITS.
(a) Defined Benefit Plans.--
(1) Dollar limit.--
(A) Subparagraph (A) of section 415(b)(1) (relating to
limitation for defined benefit plans) is amended by striking
``$90,000'' and inserting ``$160,000''.
(B) Subparagraphs (C) and (D) of section 415(b)(2) are each
amended by striking ``$90,000'' each place it appears in the
headings and the text and inserting ``$160,000''.
(C) Paragraph (7) of section 415(b) (relating to benefits
under certain collectively bargained plans) is amended by
striking ``the greater of $68,212 or one-half the amount
otherwise applicable for such year under paragraph (1)(A) for
`$90,000' '' and inserting ``one-half the amount otherwise
applicable for such year under paragraph (1)(A) for
`$160,000' ''.
(2) Limit reduced when benefit begins before age 62.--
Subparagraph (C) of section 415(b)(2) is amended by striking
``the social security retirement age'' each place it appears
in the heading and text and inserting ``age 62''.
(3) Limit increased when benefit begins after age 65.--
Subparagraph (D) of section 415(b)(2) is amended by striking
``the social security retirement age'' each place it appears
in the heading and text and inserting ``age 65''.
(4) Cost-of-living adjustments.--Subsection (d) of section
415 (related to cost-of-living adjustments) is amended--
(A) by striking ``$90,000'' in paragraph (1)(A) and
inserting ``$160,000''; and
(B) in paragraph (3)(A)--
(i) by striking ``$90,000'' in the heading and inserting
``$160,000''; and
(ii) by striking ``October 1, 1986'' and inserting ``July
1, 2000''.
(5) Conforming amendment.--Section 415(b)(2) is amended by
striking subparagraph (F).
(b) Defined Contribution Plans.--
(1) Dollar limit.--Subparagraph (A) of section 415(c)(1)
(relating to limitation for defined contribution plans) is
amended by striking ``$30,000'' and inserting ``$40,000''.
(2) Cost-of-living adjustments.--Subsection (d) of section
415 (related to cost-of-living adjustments) is amended--
(A) by striking ``$30,000'' in paragraph (1)(C) and
inserting ``$40,000''; and
(B) in paragraph (3)(D)--
(i) by striking ``$30,000'' in the heading and inserting
``$40,000''; and
(ii) by striking ``October 1, 1993'' and inserting ``July
1, 2000''.
(c) Qualified Trusts.--
(1) Compensation limit.--Sections 401(a)(17), 404(l),
408(k), and 505(b)(7) are each amended by striking
``$150,000'' each place it appears and inserting
``$200,000''.
(2) Base period and rounding of cost-of-living
adjustment.--Subparagraph (B) of section 401(a)(17) is
amended--
(A) by striking ``October 1, 1993'' and inserting ``July 1,
2000''; and
(B) by striking ``$10,000'' both places it appears and
inserting ``$5,000''.
(d) Elective Deferrals.--
(1) In general.--Paragraph (1) of section 402(g) (relating
to limitation on exclusion for elective deferrals) is amended
to read as follows:
``(1) In general.--
``(A) Limitation.--Notwithstanding subsections (e)(3) and
(h)(1)(B), the elective deferrals of any individual for any
taxable year shall be included in such individual's gross
income to the extent the amount of such deferrals for the
taxable year exceeds the applicable dollar amount.
``(B) Applicable dollar amount.--For purposes of
subparagraph (A), the applicable dollar amount shall be the
amount determined in accordance with the following table:
``For taxable years The applicable
beginning in dollar amount:
calendar year:
2001.....................................................$11,000
2002.....................................................$12,000
2003.....................................................$13,000
2004.....................................................$14,000
2005 or thereafter....................................$15,000.''.
(2) Cost-of-living adjustment.--Paragraph (5) of section
402(g) is amended to read as follows:
``(5) Cost-of-living adjustment.--In the case of taxable
years beginning after December 31, 2005, the Secretary shall
adjust the $15,000 amount under paragraph (1)(B) at the same
time and in the same manner as under section 415(d), except
that the base period shall be the calendar quarter beginning
July 1, 2004, and any increase under this paragraph which is
not a multiple of $500 shall be rounded to the next lowest
multiple of $500.''.
(3) Conforming amendments.--
(A) Section 402(g) (relating to limitation on exclusion for
elective deferrals), as amended by paragraphs (1) and (2), is
further amended by striking paragraph (4) and redesignating
paragraphs (5), (6), (7), (8), and (9) as paragraphs (4),
(5), (6), (7), and (8), respectively.
(B) Paragraph (2) of section 457(c) is amended by striking
``402(g)(8)(A)(iii)'' and inserting ``402(g)(7)(A)(iii)''.
(C) Clause (iii) of section 501(c)(18)(D) is amended by
striking ``(other than paragraph (4) thereof)''.
(e) Deferred Compensation Plans of State and Local
Governments and Tax-Exempt Organizations.--
(1) In general.--Section 457 (relating to deferred
compensation plans of State and local governments and tax-
exempt organizations) is amended--
(A) in subsections (b)(2)(A) and (c)(1) by striking
``$7,500'' each place it appears and inserting ``the
applicable dollar amount''; and
(B) in subsection (b)(3)(A) by striking ``$15,000'' and
inserting ``twice the dollar amount in effect under
subsection (b)(2)(A)''.
(2) Applicable dollar amount; cost-of-living adjustment.--
Paragraph (15) of section 457(e) is amended to read as
follows:
``(15) Applicable dollar amount.--
``(A) In general.--The applicable dollar amount shall be
the amount determined in accordance with the following table:
``For taxable years The applicable
beginning in dollar amount:
calendar year:
2001.....................................................$11,000
2002.....................................................$12,000
2003.....................................................$13,000
2004.....................................................$14,000
2005 or thereafter.......................................$15,000.
``(B) Cost-of-living adjustments.--In the case of taxable
years beginning after December 31, 2005, the Secretary shall
adjust the $15,000 amount specified in the table in
subparagraph (A) at the same time and in the same manner as
under section 415(d), except that the base period shall be
the calendar quarter beginning July 1, 2004, and any increase
under this paragraph which is not a
[[Page H7783]]
multiple of $500 shall be rounded to the next lowest multiple
of $500.''.
(f) Simple Retirement Accounts.--
(1) Limitation.--Clause (ii) of section 408(p)(2)(A)
(relating to general rule for qualified salary reduction
arrangement) is amended by striking ``$6,000'' and inserting
``the applicable dollar amount''.
(2) Applicable dollar amount.--Subparagraph (E) of
408(p)(2) is amended to read as follows:
``(E) Applicable dollar amount; cost-of-living
adjustment.--
``(i) In general.--For purposes of subparagraph (A)(ii),
the applicable dollar amount shall be the amount determined
in accordance with the following table:
``For taxable years The applicable
beginning in dollar amount:
calendar year:
2001....................................................$7,000
2002....................................................$8,000
2003....................................................$9,000
2004 or thereafter.....................................$10,000.
``(ii) Cost-of-living adjustment.--In the case of a year
beginning after December 31, 2004, the Secretary shall adjust
the $10,000 amount under clause (i) at the same time and in
the same manner as under section 415(d), except that the base
period taken into account shall be the calendar quarter
beginning July 1, 2003, and any increase under this
subparagraph which is not a multiple of $500 shall be rounded
to the next lower multiple of $500.''.
(3) Conforming amendments.--
(A) Clause (I) of section 401(k)(11)(B)(i) is amended by
striking ``$6,000'' and inserting ``the amount in effect
under section 408(p)(2)(A)(ii)''.
(B) Section 401(k)(11) is amended by striking subparagraph
(E).
(g) Rounding Rule Relating to Defined Benefit Plans and
Defined Contribution Plans.--Paragraph (4) of section 415(d)
is amended to read as follows:
``(4) Rounding.--
``(A) $160,000 amount.--Any increase under subparagraph (A)
of paragraph (1) which is not a multiple of $5,000 shall be
rounded to the next lowest multiple of $5,000.
``(B) $40,000 amount.--Any increase under subparagraph (C)
of paragraph (1) which is not a multiple of $1,000 shall be
rounded to the next lowest multiple of $1,000.''.
(h) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1202. PLAN LOANS FOR SUBCHAPTER S OWNERS, PARTNERS, AND
SOLE PROPRIETORS.
(a) In General.--Subparagraph (B) of section 4975(f)(6)
(relating to exemptions not to apply to certain transactions)
is amended by adding at the end the following new clause:
``(iii) Loan exception.--For purposes of subparagraph
(A)(i), the term `owner-employee' shall only include a person
described in subclause (II) or (III) of clause (i).''.
(b) Effective Date.--The amendment made by this section
shall apply to loans made after December 31, 2000.
SEC. 1203. MODIFICATION OF TOP-HEAVY RULES.
(a) Simplification of Definition of Key Employee.--
(1) In general.--Section 416(i)(1)(A) (defining key
employee) is amended--
(A) by striking ``or any of the 4 preceding plan years'' in
the matter preceding clause (i);
(B) by striking clause (i) and inserting the following:
``(i) an officer of the employer having an annual
compensation greater than $150,000,'';
(C) by striking clause (ii) and redesignating clauses (iii)
and (iv) as clauses (ii) and (iii), respectively; and
(D) by striking the second sentence in the matter following
clause (iii), as redesignated by subparagraph (C).
(2) Conforming amendment.--Section 416(i)(1)(B)(iii) is
amended by striking ``and subparagraph (A)(ii)''.
(b) Matching Contributions Taken Into Account for Minimum
Contribution Requirements.--Section 416(c)(2)(A) (relating to
defined contribution plans) is amended by adding at the end
the following: ``Employer matching contributions (as defined
in section 401(m)(4)(A)) shall be taken into account for
purposes of this subparagraph.''.
(c) Distributions During Last Year Before Determination
Date Taken Into Account.--
(1) In general.--Paragraph (3) of section 416(g) is amended
to read as follows:
``(3) Distributions during last year before determination
date taken into account.--
``(A) In general.--For purposes of determining--
``(i) the present value of the cumulative accrued benefit
for any employee, or
``(ii) the amount of the account of any employee,
such present value or amount shall be increased by the
aggregate distributions made with respect to such employee
under the plan during the 1-year period ending on the
determination date. The preceding sentence shall also apply
to distributions under a terminated plan which if it had not
been terminated would have been required to be included in an
aggregation group.
``(B) 5-year period in case of in-service distribution.--In
the case of any distribution made for a reason other than
separation from service, death, or disability, subparagraph
(A) shall be applied by substituting `5-year period' for `1-
year period'.''.
(2) Benefits not taken into account.--Subparagraph (E) of
section 416(g)(4) is amended--
(A) by striking ``last 5 years'' in the heading and
inserting ``last year before determination date''; and
(B) by striking ``5-year period'' and inserting ``1-year
period''.
(d) Definition of Top-Heavy Plans.--Paragraph (4) of
section 416(g) (relating to other special rules for top-heavy
plans) is amended by adding at the end the following new
subparagraph:
``(H) Cash or deferred arrangements using alternative
methods of meeting nondiscrimination requirements.--The term
`top-heavy plan' shall not include a plan which consists
solely of--
``(i) a cash or deferred arrangement which meets the
requirements of section 401(k)(12), and
``(ii) matching contributions with respect to which the
requirements of section 401(m)(11) are met.
If, but for this subparagraph, a plan would be treated as a
top-heavy plan because it is a member of an aggregation group
which is a top-heavy group, contributions under the plan may
be taken into account in determining whether any other plan
in the group meets the requirements of subsection (c)(2).''.
(e) Frozen Plan Exempt From Minimum Benefit Requirement.--
Subparagraph (C) of section 416(c)(1) (relating to defined
benefit plans) is amended--
(A) by striking ``clause (ii)'' in clause (i) and inserting
``clause (ii) or (iii)''; and
(B) by adding at the end the following:
``(iii) Exception for frozen plan.--For purposes of
determining an employee's years of service with the employer,
any service with the employer shall be disregarded to the
extent that such service occurs during a plan year when the
plan benefits (within the meaning of section 410(b)) no
employee or former employee.''.
(f) Elimination of Family Attribution.--Section
416(i)(1)(B) (defining 5-percent owner) is amended by adding
at the end the following new clause:
``(iv) Family attribution disregarded.--Solely for purposes
of applying this paragraph (and not for purposes of any
provision of this title which incorporates by reference the
definition of a key employee or 5-percent owner under this
paragraph), section 318 shall be applied without regard to
subsection (a)(1) thereof in determining whether any person
is a 5-percent owner.''.
(g) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1204. ELECTIVE DEFERRALS NOT TAKEN INTO ACCOUNT FOR
PURPOSES OF DEDUCTION LIMITS.
(a) In General.--Section 404 (relating to deduction for
contributions of an employer to an employees' trust or
annuity plan and compensation under a deferred payment plan)
is amended by adding at the end the following new subsection:
``(n) Elective Deferrals Not Taken Into Account for
Purposes of Deduction Limits.--Elective deferrals (as defined
in section 402(g)(3)) shall not be subject to any limitation
contained in paragraph (3), (7), or (9) of subsection (a),
and such elective deferrals shall not be taken into account
in applying any such limitation to any other
contributions.''.
(b) Effective Date.--The amendment made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1205. REPEAL OF COORDINATION REQUIREMENTS FOR DEFERRED
COMPENSATION PLANS OF STATE AND LOCAL
GOVERNMENTS AND TAX-EXEMPT ORGANIZATIONS.
(a) In General.--Subsection (c) of section 457 (relating to
deferred compensation plans of State and local governments
and tax-exempt organizations), as amended by section 1201, is
amended to read as follows:
``(c) Limitation.--The maximum amount of the compensation
of any one individual which may be deferred under subsection
(a) during any taxable year shall not exceed the amount in
effect under subsection (b)(2)(A) (as modified by any
adjustment provided under subsection (b)(3)).''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to years beginning after December 31, 2000.
SEC. 1206. ELIMINATION OF USER FEE FOR REQUESTS TO IRS
REGARDING PENSION PLANS.
(a) Elimination of Certain User Fees.--The Secretary of the
Treasury or the Secretary's delegate shall not require
payment of user fees under the program established under
section 7527 of the Internal Revenue Code of 1986 for
requests to the Internal Revenue Service for determination
letters with respect to the qualified status of a pension
benefit plan maintained solely by one or more eligible
employers or any trust which is part of the plan. The
preceding sentence shall not apply to any request--
(1) made after the fifth plan year the pension benefit plan
is in existence; or
(2) made by the sponsor of any prototype or similar plan
which the sponsor intends to market to participating
employers.
(b) Pension Benefit Plan.--For purposes of this section,
the term ``pension benefit plan'' means a pension, profit-
sharing, stock bonus, annuity, or employee stock ownership
plan.
(c) Eligible Employer.--For purposes of this section, the
term ``eligible employer'' has the same meaning given such
term in
[[Page H7784]]
section 408(p)(2)(C)(i)(I) of the Internal Revenue Code of
1986. The determination of whether an employer is an eligible
employer under this section shall be made as of the date of
the request described in subsection (a).
(d) Effective Date.--The provisions of this section shall
apply with respect to requests made after December 31, 2000.
SEC. 1207. DEDUCTION LIMITS.
(a) In General.--
(1) Stock bonus and profit sharing trusts.--Subclause (I)
of section 404(a)(3)(A)(i) (relating to stock bonus and
profit sharing trusts) is amended by striking ``15 percent''
and inserting ``20 percent''.
(2) Compensation.--Section 404(a) (relating to general
rule) is amended by adding at the end the following:
``(12) Definition of compensation.--For purposes of
paragraphs (3), (7), (8), and (9), the term `compensation
otherwise paid or accrued during the taxable year' shall
include amounts treated as `participant's compensation' under
subparagraph (C) or (D) of section 415(c)(3).''.
(b) Conforming Amendments.--
(1) Subparagraph (B) of section 404(a)(3) is amended by
striking the last sentence thereof.
(2) Subparagraph (C) of section 404(h)(1) is amended by
striking ``15 percent'' each place it appears and inserting
``20 percent''.
(3) Clause (i) of section 4972(c)(6)(B) is amended by
striking ``(within the meaning of section 404(a))'' and
inserting ``(within the meaning of section 404(a) and as
adjusted under section 404(a)(12))''.
(c) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1208. OPTION TO TREAT ELECTIVE DEFERRALS AS AFTER-TAX
CONTRIBUTIONS.
(a) In General.--Subpart A of part I of subchapter D of
chapter 1 (relating to deferred compensation, etc.) is
amended by inserting after section 402 the following new
section:
``SEC. 402A. OPTIONAL TREATMENT OF ELECTIVE DEFERRALS AS PLUS
CONTRIBUTIONS.
``(a) General Rule.--If an applicable retirement plan
includes a qualified plus contribution program--
``(1) any designated plus contribution made by an employee
pursuant to the program shall be treated as an elective
deferral for purposes of this chapter, except that such
contribution shall not be excludable from gross income, and
``(2) such plan (and any arrangement which is part of such
plan) shall not be treated as failing to meet any requirement
of this chapter solely by reason of including such program.
``(b) Qualified Plus Contribution Program.--For purposes of
this section--
``(1) In general.--The term `qualified plus contribution
program' means a program under which an employee may elect to
make designated plus contributions in lieu of all or a
portion of elective deferrals the employee is otherwise
eligible to make under the applicable retirement plan.
``(2) Separate accounting required.--A program shall not be
treated as a qualified plus contribution program unless the
applicable retirement plan--
``(A) establishes separate accounts (`designated plus
accounts') for the designated plus contributions of each
employee and any earnings properly allocable to the
contributions, and
``(B) maintains separate recordkeeping with respect to each
account.
``(c) Definitions and Rules Relating to Designated Plus
Contributions.--For purposes of this section--
``(1) Designated plus contribution.--The term `designated
plus contribution' means any elective deferral which--
``(A) is excludable from gross income of an employee
without regard to this section, and
``(B) the employee designates (at such time and in such
manner as the Secretary may prescribe) as not being so
excludable.
``(2) Designation limits.--The amount of elective deferrals
which an employee may designate under paragraph (1) shall not
exceed the excess (if any) of--
``(A) the maximum amount of elective deferrals excludable
from gross income of the employee for the taxable year
(without regard to this section), over
``(B) the aggregate amount of elective deferrals of the
employee for the taxable year which the employee does not
designate under paragraph (1).
``(3) Rollover contributions.--
``(A) In general.--A rollover contribution of any payment
or distribution from a designated plus account which is
otherwise allowable under this chapter may be made only if
the contribution is to--
``(i) another designated plus account of the individual
from whose account the payment or distribution was made, or
``(ii) a Roth IRA of such individual.
``(B) Coordination with limit.--Any rollover contribution
to a designated plus account under subparagraph (A) shall not
be taken into account for purposes of paragraph (1).
``(d) Distribution Rules.--For purposes of this title--
``(1) Exclusion.--Any qualified distribution from a
designated plus account shall not be includible in gross
income.
``(2) Qualified distribution.--For purposes of this
subsection--
``(A) In general.--The term `qualified distribution' has
the meaning given such term by section 408A(d)(2)(A) (without
regard to clause (iv) thereof).
``(B) Distributions within nonexclusion period.--A payment
or distribution from a designated plus account shall not be
treated as a qualified distribution if such payment or
distribution is made within the 5-taxable-year period
beginning with the earlier of--
``(i) the first taxable year for which the individual made
a designated plus contribution to any designated plus account
established for such individual under the same applicable
retirement plan, or
``(ii) if a rollover contribution was made to such
designated plus account from a designated plus account
previously established for such individual under another
applicable retirement plan, the first taxable year for which
the individual made a designated plus contribution to such
previously established account.
``(C) Distributions of excess deferrals and earnings.--The
term `qualified distribution' shall not include any
distribution of any excess deferral under section 402(g)(2)
and any income on the excess deferral.
``(3) Aggregation rules.--Section 72 shall be applied
separately with respect to distributions and payments from a
designated plus account and other distributions and payments
from the plan.
``(e) Other Definitions.--For purposes of this section--
``(1) Applicable retirement plan.--The term `applicable
retirement plan' means--
``(A) an employees' trust described in section 401(a) which
is exempt from tax under section 501(a), and
``(B) a plan under which amounts are contributed by an
individual's employer for an annuity contract described in
section 403(b).
``(2) Elective deferral.--The term `elective deferral'
means any elective deferral described in subparagraph (A) or
(C) of section 402(g)(3).''.
(b) Excess Deferrals.--Section 402(g) (relating to
limitation on exclusion for elective deferrals) is amended--
(1) by adding at the end of paragraph (1) the following new
sentence: ``The preceding sentence shall not apply to so much
of such excess as does not exceed the designated plus
contributions of the individual for the taxable year.''; and
(2) by inserting ``(or would be included but for the last
sentence thereof)'' after ``paragraph (1)'' in paragraph
(2)(A).
(c) Rollovers.--Subparagraph (B) of section 402(c)(8) is
amended by adding at the end the following:
``If any portion of an eligible rollover distribution is
attributable to payments or distributions from a designated
plus account (as defined in section 402A), an eligible
retirement plan with respect to such portion shall include
only another designated plus account and a Roth IRA.''.
(d) Reporting Requirements.--
(1) W-2 information.--Section 6051(a)(8) is amended by
inserting ``, including the amount of designated plus
contributions (as defined in section 402A)'' before the comma
at the end.
(2) Information.--Section 6047 is amended by redesignating
subsection (f) as subsection (g) and by inserting after
subsection (e) the following new subsection:
``(f) Designated Plus Contributions.--The Secretary shall
require the plan administrator of each applicable retirement
plan (as defined in section 402A) to make such returns and
reports regarding designated plus contributions (as so
defined) to the Secretary, participants and beneficiaries of
the plan, and such other persons as the Secretary may
prescribe.''.
(e) Conforming Amendments.--
(1) Section 408A(e) is amended by adding after the first
sentence the following new sentence: ``Such term includes a
rollover contribution described in section 402A(c)(3)(A).''.
(2) The table of sections for subpart A of part I of
subchapter D of chapter 1 is amended by inserting after the
item relating to section 402 the following new item:
``Sec. 402A. Optional treatment of elective deferrals as plus
contributions.''.
(f) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2000.
TITLE XIII--ENHANCING FAIRNESS FOR WOMEN
SEC. 1301. CATCH-UP CONTRIBUTIONS FOR INDIVIDUALS AGE 50 OR
OVER.
(a) In General.--Section 414 (relating to definitions and
special rules) is amended by adding at the end the following
new subsection:
``(v) Catch-up Contributions for Individuals Age 50 or
Over.--
``(1) In general.--An applicable employer plan shall not be
treated as failing to meet any requirement of this title
solely because the plan permits an eligible participant to
make additional elective deferrals in any plan year.
``(2) Limitation on amount of additional deferrals.--A plan
shall not permit additional elective deferrals under
paragraph (1) for any year in an amount greater than the
lesser of--
``(A) $5,000, or
``(B) the excess (if any) of--
``(i) the participant's compensation for the year, over
``(ii) any other elective deferrals of the participant for
such year which are made without regard to this subsection.
[[Page H7785]]
``(3) Treatment of contributions.--In the case of any
contribution to a plan under paragraph (1), such contribution
shall not, with respect to the year in which the contribution
is made--
``(A) be subject to any otherwise applicable limitation
contained in section 402(g), 402(h)(2), 404(a), 404(h),
408(p)(2)(A)(ii), 415, or 457, or
``(B) be taken into account in applying such limitations to
other contributions or benefits under such plan or any other
such plan.
``(4) Eligible participant.--For purposes of this
subsection, the term `eligible participant' means, with
respect to any plan year, a participant in a plan--
``(A) who has attained the age of 50 before the close of
the plan year, and
``(B) with respect to whom no other elective deferrals may
(without regard to this subsection) be made to the plan for
the plan year by reason of the application of any limitation
or other restriction described in paragraph (3) or comparable
limitation contained in the terms of the plan.
``(5) Other definitions and rules.--For purposes of this
subsection--
``(A) Applicable employer plan.--The term `applicable
employer plan' means--
``(i) an employees' trust described in section 401(a) which
is exempt from tax under section 501(a),
``(ii) a plan under which amounts are contributed by an
individual's employer for an annuity contract described in
section 403(b),
``(iii) an eligible deferred compensation plan under
section 457 of an eligible employer as defined in section
457(e)(1)(A), and
``(iv) an arrangement meeting the requirements of section
408 (k) or (p).
``(B) Elective deferral.--The term `elective deferral' has
the meaning given such term by subsection (u)(2)(C).
``(C) Exception for section 457 plans.--This subsection
shall not apply to an applicable employer plan described in
subparagraph (A)(iii) for any year to which section 457(b)(3)
applies.
``(D) Cost-of-living adjustment.--For years beginning after
December 31, 2005, the Secretary shall adjust annually the
$5,000 amount in subparagraph (A) for increases in the cost-
of-living at the same time and in the same manner as
adjustments under section 415(d); except that the base period
shall be the calendar quarter beginning July 1, 2004, and any
increase which is not a multiple of $500 shall be rounded to
the next lowest multiple of $500.''.
(b) Effective Date.--The amendment made by this section
shall apply to contributions in taxable years beginning after
December 31, 2000.
SEC. 1302. EQUITABLE TREATMENT FOR CONTRIBUTIONS OF EMPLOYEES
TO DEFINED CONTRIBUTION PLANS.
(a) Equitable Treatment.--
(1) In general.--Subparagraph (B) of section 415(c)(1)
(relating to limitation for defined contribution plans) is
amended by striking ``25 percent'' and inserting ``100
percent''.
(2) Application to section 403(b).--Section 403(b) is
amended--
(A) by striking ``the exclusion allowance for such taxable
year'' in paragraph (1) and inserting ``the applicable limit
under section 415'';
(B) by striking paragraph (2); and
(C) by inserting ``or any amount received by a former
employee after the fifth taxable year following the taxable
year in which such employee was terminated'' before the
period at the end of the second sentence of paragraph (3).
(3) Conforming amendments.--
(A) Subsection (f) of section 72 is amended by striking
``section 403(b)(2)(D)(iii))'' and inserting ``section
403(b)(2)(D)(iii), as in effect before the enactment of the
Debt Relief and Retirement Security Reconciliation Act)''.
(B) Section 404(a)(10)(B) is amended by striking ``, the
exclusion allowance under section 403(b)(2),''.
(C) Section 415(a)(2) is amended by striking ``, and the
amount of the contribution for such portion shall reduce the
exclusion allowance as provided in section 403(b)(2)''.
(D) Section 415(c)(3) is amended by adding at the end the
following new subparagraph:
``(E) Annuity contracts.--In the case of an annuity
contract described in section 403(b), the term `participant's
compensation' means the participant's includible compensation
determined under section 403(b)(3).''.
(E) Section 415(c) is amended by striking paragraph (4).
(F) Section 415(c)(7) is amended to read as follows:
``(7) Certain contributions by church plans not treated as
exceeding limit.--
``(A) In general.--Notwithstanding any other provision of
this subsection, at the election of a participant who is an
employee of a church or a convention or association of
churches, including an organization described in section
414(e)(3)(B)(ii), contributions and other additions for an
annuity contract or retirement income account described in
section 403(b) with respect to such participant, when
expressed as an annual addition to such participant's
account, shall be treated as not exceeding the limitation of
paragraph (1) if such annual addition is not in excess of
$10,000.
``(B) $40,000 aggregate limitation.--The total amount of
additions with respect to any participant which may be taken
into account for purposes of this subparagraph for all years
may not exceed $40,000.
``(C) Annual addition.--For purposes of this paragraph, the
term `annual addition' has the meaning given such term by
paragraph (2).''.
(G) Subparagraph (B) of section 402(g)(7) (as redesignated
by section 211) is amended by inserting before the period at
the end the following: ``(as in effect before the enactment
of the Debt Relief and Retirement Security Reconciliation
Act)''.
(3) Effective date.--The amendments made by this subsection
shall apply to years beginning after December 31, 2000.
(b) Special Rules for Sections 403(b) and 408.--
(1) In general.--Subsection (k) of section 415 is amended
by adding at the end the following new paragraph:
``(4) Special rules for sections 403(b) and 408.--For
purposes of this section, any annuity contract described in
section 403(b) for the benefit of a participant shall be
treated as a defined contribution plan maintained by each
employer with respect to which the participant has the
control required under subsection (b) or (c) of section 414
(as modified by subsection (h)). For purposes of this
section, any contribution by an employer to a simplified
employee pension plan for an individual for a taxable year
shall be treated as an employer contribution to a defined
contribution plan for such individual for such year.''.
(2) Effective date.--
(A) In general.--The amendment made by paragraph (1) shall
apply to limitation years beginning after December 31, 1999.
(B) Exclusion allowance.--Effective for limitation years
beginning in 2000, in the case of any annuity contract
described in section 403(b) of the Internal Revenue Code of
1986, the amount of the contribution disqualified by reason
of section 415(g) of such Code shall reduce the exclusion
allowance as provided in section 403(b)(2) of such Code.
(3) Modification of 403(b) exclusion allowance to conform
to 415 modification.--The Secretary of the Treasury shall
modify the regulations regarding the exclusion allowance
under section 403(b)(2) of the Internal Revenue Code of 1986
to render void the requirement that contributions to a
defined benefit pension plan be treated as previously
excluded amounts for purposes of the exclusion allowance. For
taxable years beginning after December 31, 1999, such
regulations shall be applied as if such requirement were
void.
(c) Deferred Compensation Plans of State and Local
Governments and Tax-Exempt Organizations.--
(1) In general.--Subparagraph (B) of section 457(b)(2)
(relating to salary limitation on eligible deferred
compensation plans) is amended by striking ``33\1/3\
percent'' and inserting ``100 percent''.
(2) Effective date.--The amendment made by this subsection
shall apply to years beginning after December 31, 2000.
SEC. 1303. FASTER VESTING OF CERTAIN EMPLOYER MATCHING
CONTRIBUTIONS.
(a) In General.--Section 411(a) (relating to minimum
vesting standards) is amended--
(1) in paragraph (2), by striking ``A plan'' and inserting
``Except as provided in paragraph (12), a plan''; and
(2) by adding at the end the following:
``(12) Faster vesting for matching contributions.--In the
case of matching contributions (as defined in section
401(m)(4)(A)), paragraph (2) shall be applied--
``(A) by substituting `3 years' for `5 years' in
subparagraph (A), and
``(B) by substituting the following table for the table
contained in subparagraph (B):
The nonforfeitable
``Years of service: percentage is:
2............................................................20
3............................................................40
4............................................................60
5............................................................80
6.........................................................100.''.
(b) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to contributions
for plan years beginning after December 31, 2000.
(2) Collective bargaining agreements.--In the case of a
plan maintained pursuant to one or more collective bargaining
agreements between employee representatives and one or more
employers ratified by the date of the enactment of this Act,
the amendments made by this section shall not apply to
contributions on behalf of employees covered by any such
agreement for plan years beginning before the earlier of--
(A) the later of--
(i) the date on which the last of such collective
bargaining agreements terminates (determined without regard
to any extension thereof on or after such date of the
enactment); or
(ii) January 1, 2001; or
(B) January 1, 2005.
(3) Service required.--With respect to any plan, the
amendments made by this section shall not apply to any
employee before the date that such employee has 1 hour of
service under such plan in any plan year to which the
amendments made by this section apply.
SEC. 1304. SIMPLIFY AND UPDATE THE MINIMUM DISTRIBUTION
RULES.
(a) Simplification and Finalization of Minimum Distribution
Requirements.--
(1) In general.--The Secretary of the Treasury shall--
[[Page H7786]]
(A) simplify and finalize the regulations relating to
minimum distribution requirements under sections 401(a)(9),
408(a)(6) and (b)(3), 403(b)(10), and 457(d)(2) of the
Internal Revenue Code of 1986; and
(B) modify such regulations to--
(i) reflect current life expectancy; and
(ii) revise the required distribution methods so that,
under reasonable assumptions, the amount of the required
minimum distribution does not decrease over a participant's
life expectancy.
(2) Fresh start.--Notwithstanding subparagraph (D) of
section 401(a)(9) of such Code, during the first year that
regulations are in effect under this subsection, required
distributions for future years may be redetermined to reflect
changes under such regulations. Such redetermination shall
include the opportunity to choose a new designated
beneficiary and to elect a new method of calculating life
expectancy.
(3) Effective date for regulations.--Regulations referred
to in paragraph (1) shall be effective for years beginning
after December 31, 2000, and shall apply in such years
without regard to whether an individual had previously begun
receiving minimum distributions.
(b) Repeal of Rule Where Distributions Had Begun Before
Death Occurs.--
(1) In general.--Subparagraph (B) of section 401(a)(9) is
amended by striking clause (i) and redesignating clauses
(ii), (iii), and (iv) as clauses (i), (ii), and (iii),
respectively.
(2) Conforming changes.--
(A) Clause (i) of section 401(a)(9)(B) (as so redesignated)
is amended--
(i) by striking ``for other cases'' in the heading; and
(ii) by striking ``the distribution of the employee's
interest has begun in accordance with subparagraph (A)(ii)''
and inserting ``his entire interest has been distributed to
him''.
(B) Clause (ii) of section 401(a)(9)(B) (as so
redesignated) is amended by striking ``clause (ii)'' and
inserting ``clause (i)''.
(C) Clause (iii) of section 401(a)(9)(B) (as so
redesignated) is amended--
(i) by striking ``clause (iii)(I)'' and inserting ``clause
(ii)(I)'';
(ii) by striking ``clause (iii)(III)'' in subclause (I) and
inserting ``clause (ii)(III)'';
(iii) by striking ``the date on which the employee would
have attained age 70\1/2\,'' in subclause (I) and inserting
``April 1 of the calendar year following the calendar year in
which the spouse attains 70\1/2\,''; and
(iv) by striking ``the distributions to such spouse
begin,'' in subclause (II) and inserting ``his entire
interest has been distributed to him,''.
(3) Effective date.--The amendments made by this subsection
shall apply to years beginning after December 31, 2000.
(c) Reduction in Excise Tax.--
(1) In general.--Subsection (a) of section 4974 is amended
by striking ``50 percent'' and inserting ``10 percent''.
(2) Effective date.--The amendment made by this subsection
shall apply to years beginning after December 31, 2000.
SEC. 1305. CLARIFICATION OF TAX TREATMENT OF DIVISION OF
SECTION 457 PLAN BENEFITS UPON DIVORCE.
(a) In General.--Section 414(p)(11) (relating to
application of rules to governmental and church plans) is
amended--
(1) by inserting ``or an eligible deferred compensation
plan (within the meaning of section 457(b))'' after
``subsection (e))''; and
(2) in the heading, by striking ``governmental and church
plans'' and inserting ``certain other plans''.
(b) Waiver of Certain Distribution Requirements.--Paragraph
(10) of section 414(p) is amended by striking ``and section
409(d)'' and inserting ``section 409(d), and section
457(d)''.
(c) Tax Treatment of Payments From a Section 457 Plan.--
Subsection (p) of section 414 is amended by redesignating
paragraph (12) as paragraph (13) and inserting after
paragraph (11) the following new paragraph:
``(12) Tax treatment of payments from a section 457 plan.--
If a distribution or payment from an eligible deferred
compensation plan described in section 457(b) is made
pursuant to a qualified domestic relations order, rules
similar to the rules of section 402(e)(1)(A) shall apply to
such distribution or payment.''.
(d) Effective Date.--The amendments made by this section
shall apply to transfers, distributions, and payments made
after December 31, 2000.
SEC. 1306. MODIFICATION OF SAFE HARBOR RELIEF FOR HARDSHIP
WITHDRAWALS FROM CASH OR DEFERRED ARRANGEMENTS.
(a) In General.--The Secretary of the Treasury shall revise
the regulations relating to hardship distributions under
section 401(k)(2)(B)(i)(IV) of the Internal Revenue Code of
1986 to provide that the period an employee is prohibited
from making elective and employee contributions in order for
a distribution to be deemed necessary to satisfy financial
need shall be equal to 6 months.
(b) Effective Date.--The revised regulations under
subsection (a) shall apply to years beginning after December
31, 2000.
TITLE XIV--INCREASING PORTABILITY FOR PARTICIPANTS
SEC. 1401. ROLLOVERS ALLOWED AMONG VARIOUS TYPES OF PLANS.
(a) Rollovers From and to Section 457 Plans.--
(1) Rollovers from section 457 plans.--
(A) In general.--Section 457(e) (relating to other
definitions and special rules) is amended by adding at the
end the following:
``(16) Rollover amounts.--
``(A) General rule.--In the case of an eligible deferred
compensation plan established and maintained by an employer
described in subsection (e)(1)(A), if--
``(i) any portion of the balance to the credit of an
employee in such plan is paid to such employee in an eligible
rollover distribution (within the meaning of section
402(c)(4) without regard to subparagraph (C) thereof),
``(ii) the employee transfers any portion of the property
such employee receives in such distribution to an eligible
retirement plan described in section 402(c)(8)(B), and
``(iii) in the case of a distribution of property other
than money, the amount so transferred consists of the
property distributed,
then such distribution (to the extent so transferred) shall
not be includible in gross income for the taxable year in
which paid.
``(B) Certain rules made applicable.--The rules of
paragraphs (2) through (7) (other than paragraph (4)(C)) and
(9) of section 402(c) and section 402(f) shall apply for
purposes of subparagraph (A).
``(C) Reporting.--Rollovers under this paragraph shall be
reported to the Secretary in the same manner as rollovers
from qualified retirement plans (as defined in section
4974(c)).''.
(B) Deferral limit determined without regard to rollover
amounts.--Section 457(b)(2) (defining eligible deferred
compensation plan) is amended by inserting ``(other than
rollover amounts)'' after ``taxable year''.
(C) Direct rollover.--Paragraph (1) of section 457(d) is
amended by striking ``and'' at the end of subparagraph (A),
by striking the period at the end of subparagraph (B) and
inserting ``, and'', and by inserting after subparagraph (B)
the following:
``(C) in the case of a plan maintained by an employer
described in subsection (e)(1)(A), the plan meets
requirements similar to the requirements of section
401(a)(31).
Any amount transferred in a direct trustee-to-trustee
transfer in accordance with section 401(a)(31) shall not be
includible in gross income for the taxable year of
transfer.''.
(D) Withholding.--
(i) Paragraph (12) of section 3401(a) is amended by adding
at the end the following:
``(E) under or to an eligible deferred compensation plan
which, at the time of such payment, is a plan described in
section 457(b) maintained by an employer described in section
457(e)(1)(A); or''.
(ii) Paragraph (3) of section 3405(c) is amended to read as
follows:
``(3) Eligible rollover distribution.--For purposes of this
subsection, the term `eligible rollover distribution' has the
meaning given such term by section 402(f)(2)(A).''.
(iii) Liability for withholding.--Subparagraph (B) of
section 3405(d)(2) is amended by striking ``or'' at the end
of clause (ii), by striking the period at the end of clause
(iii) and inserting ``, or'', and by adding at the end the
following:
``(iv) section 457(b).''.
(2) Rollovers to section 457 plans.--
(A) In general.--Section 402(c)(8)(B) (defining eligible
retirement plan) is amended by striking ``and'' at the end of
clause (iii), by striking the period at the end of clause
(iv) and inserting ``, and'', and by inserting after clause
(iv) the following new clause:
``(v) an eligible deferred compensation plan described in
section 457(b) of an employer described in section
457(e)(1)(A).''.
(B) Separate accounting.--Section 402(c) is amended by
adding at the end the following new paragraph:
``(11) Separate accounting.--Unless a plan described in
clause (v) of paragraph (8)(B) agrees to separately account
for amounts rolled into such plan from eligible retirement
plans not described in such clause, the plan described in
such clause may not accept transfers or rollovers from such
retirement plans.''.
(C) 10 percent additional tax.--Subsection (t) of section
72 (relating to 10-percent additional tax on early
distributions from qualified retirement plans) is amended by
adding at the end the following new paragraph:
``(9) Special rule for rollovers to section 457 plans.--For
purposes of this subsection, a distribution from an eligible
deferred compensation plan (as defined in section 457(b)) of
an employer described in section 457(e)(1)(A) shall be
treated as a distribution from a qualified retirement plan
described in 4974(c)(1) to the extent that such distribution
is attributable to an amount transferred to an eligible
deferred compensation plan from a qualified retirement plan
(as defined in section 4974(c)).''.
(b) Allowance of Rollovers From and to 403(b) Plans.--
(1) Rollovers from section 403(b) plans.--Section
403(b)(8)(A)(ii) (relating to rollover amounts) is amended by
striking ``such distribution'' and all that follows and
inserting ``such distribution to an eligible retirement plan
described in section 402(c)(8)(B), and''.
(2) Rollovers to section 403(b) plans.--Section
402(c)(8)(B) (defining eligible retirement plan), as amended
by subsection (a), is amended by striking ``and'' at the end
of clause (iv), by striking the period at the end of clause
(v) and inserting ``, and'', and by inserting after clause
(v) the following new clause:
``(vi) an annuity contract described in section 403(b).''.
(c) Expanded Explanation to Recipients of Rollover
Distributions.--Paragraph (1)
[[Page H7787]]
of section 402(f) (relating to written explanation to
recipients of distributions eligible for rollover treatment)
is amended by striking ``and'' at the end of subparagraph
(C), by striking the period at the end of subparagraph (D)
and inserting ``, and'', and by adding at the end the
following new subparagraph:
``(E) of the provisions under which distributions from the
eligible retirement plan receiving the distribution may be
subject to restrictions and tax consequences which are
different from those applicable to distributions from the
plan making such distribution.''.
(d) Spousal Rollovers.--Section 402(c)(9) (relating to
rollover where spouse receives distribution after death of
employee) is amended by striking ``; except that'' and all
that follows up to the end period.
(e) Conforming Amendments.--
(1) Section 72(o)(4) is amended by striking ``and
408(d)(3)'' and inserting ``403(b)(8), 408(d)(3), and
457(e)(16)''.
(2) Section 219(d)(2) is amended by striking ``or
408(d)(3)'' and inserting ``408(d)(3), or 457(e)(16)''.
(3) Section 401(a)(31)(B) is amended by striking ``and
403(a)(4)'' and inserting ``, 403(a)(4), 403(b)(8), and
457(e)(16)''.
(4) Subparagraph (A) of section 402(f)(2) is amended by
striking ``or paragraph (4) of section 403(a)'' and inserting
``, paragraph (4) of section 403(a), subparagraph (A) of
section 403(b)(8), or subparagraph (A) of section
457(e)(16)''.
(5) Paragraph (1) of section 402(f) is amended by striking
``from an eligible retirement plan''.
(6) Subparagraphs (A) and (B) of section 402(f)(1) are
amended by striking ``another eligible retirement plan'' and
inserting ``an eligible retirement plan''.
(7) Subparagraph (B) of section 403(b)(8) is amended to
read as follows:
``(B) Certain rules made applicable.--The rules of
paragraphs (2) through (7) and (9) of section 402(c) and
section 402(f) shall apply for purposes of subparagraph (A),
except that section 402(f) shall be applied to the payor in
lieu of the plan administrator.''.
(8) Section 408(a)(1) is amended by striking ``or
403(b)(8),'' and inserting ``403(b)(8), or 457(e)(16)''.
(9) Subparagraphs (A) and (B) of section 415(b)(2) are each
amended by striking ``and 408(d)(3)'' and inserting
``403(b)(8), 408(d)(3), and 457(e)(16)''.
(10) Section 415(c)(2) is amended by striking ``and
408(d)(3)'' and inserting ``408(d)(3), and 457(e)(16)''.
(11) Section 4973(b)(1)(A) is amended by striking ``or
408(d)(3)'' and inserting ``408(d)(3), or 457(e)(16)''.
(f) Effective Date; Special Rule.--
(1) Effective date.--The amendments made by this section
shall apply to distributions after December 31, 2000.
(2) Special rule.--Notwithstanding any other provision of
law, subsections (h)(3) and (h)(5) of section 1122 of the Tax
Reform Act of 1986 shall not apply to any distribution from
an eligible retirement plan (as defined in clause (iii) or
(iv) of section 402(c)(8)(B) of the Internal Revenue Code of
1986) on behalf of an individual if there was a rollover to
such plan on behalf of such individual which is permitted
solely by reason of any amendment made by this section.
SEC. 1402. ROLLOVERS OF IRAS INTO WORKPLACE RETIREMENT PLANS.
(a) In General.--Subparagraph (A) of section 408(d)(3)
(relating to rollover amounts) is amended by adding ``or'' at
the end of clause (i), by striking clauses (ii) and (iii),
and by adding at the end the following:
``(ii) the entire amount received (including money and any
other property) is paid into an eligible retirement plan for
the benefit of such individual not later than the 60th day
after the date on which the payment or distribution is
received, except that the maximum amount which may be paid
into such plan may not exceed the portion of the amount
received which is includible in gross income (determined
without regard to this paragraph).
For purposes of clause (ii), the term `eligible retirement
plan' means an eligible retirement plan described in clause
(iii), (iv), (v), or (vi) of section 402(c)(8)(B).''.
(b) Conforming Amendments.--
(1) Paragraph (1) of section 403(b) is amended by striking
``section 408(d)(3)(A)(iii)'' and inserting ``section
408(d)(3)(A)(ii)''.
(2) Clause (i) of section 408(d)(3)(D) is amended by
striking ``(i), (ii), or (iii)'' and inserting ``(i) or
(ii)''.
(3) Subparagraph (G) of section 408(d)(3) is amended to
read as follows:
``(G) Simple retirement accounts.--In the case of any
payment or distribution out of a simple retirement account
(as defined in subsection (p)) to which section 72(t)(6)
applies, this paragraph shall not apply unless such payment
or distribution is paid into another simple retirement
account.''.
(c) Effective Date; Special Rule.--
(1) Effective date.--The amendments made by this section
shall apply to distributions after December 31, 2000.
(2) Special rule.--Notwithstanding any other provision of
law, subsections (h)(3) and (h)(5) of section 1122 of the Tax
Reform Act of 1986 shall not apply to any distribution from
an eligible retirement plan (as defined in clause (iii) or
(iv) of section 402(c)(8)(B) of the Internal Revenue Code of
1986) on behalf of an individual if there was a rollover to
such plan on behalf of such individual which is permitted
solely by reason of the amendments made by this section.
SEC. 1403. ROLLOVERS OF AFTER-TAX CONTRIBUTIONS.
(a) Rollovers From Exempt Trusts.--Paragraph (2) of section
402(c) (relating to maximum amount which may be rolled over)
is amended by adding at the end the following: ``The
preceding sentence shall not apply to such distribution to
the extent--
``(A) such portion is transferred in a direct trustee-to-
trustee transfer to a qualified trust which is part of a plan
which is a defined contribution plan and which agrees to
separately account for amounts so transferred, including
separately accounting for the portion of such distribution
which is includible in gross income and the portion of such
distribution which is not so includible, or
``(B) such portion is transferred to an eligible retirement
plan described in clause (i) or (ii) of paragraph (8)(B).''.
(b) Optional Direct Transfer of Eligible Rollover
Distributions.--Subparagraph (B) of section 401(a)(31)
(relating to limitation) is amended by adding at the end the
following: ``The preceding sentence shall not apply to such
distribution if the plan to which such distribution is
transferred--
``(i) agrees to separately account for amounts so
transferred, including separately accounting for the portion
of such distribution which is includible in gross income and
the portion of such distribution which is not so includible,
or
``(ii) is an eligible retirement plan described in clause
(i) or (ii) of section 402(c)(8)(B).''.
(c) Rules for Applying Section 72 to IRAs.--Paragraph (3)
of section 408(d) (relating to special rules for applying
section 72) is amended by inserting at the end the following:
``(H) Application of section 72.--
``(i) In general.--If--
``(I) a distribution is made from an individual retirement
plan, and
``(II) a rollover contribution is made to an eligible
retirement plan described in section 402(c)(8)(B)(iii), (iv),
(v), or (vi) with respect to all or part of such
distribution,
then, notwithstanding paragraph (2), the rules of clause (ii)
shall apply for purposes of applying section 72.
``(ii) Applicable rules.--In the case of a distribution
described in clause (i)--
``(I) section 72 shall be applied separately to such
distribution,
``(II) notwithstanding the pro rata allocation of income
on, and investment in, the contract to distributions under
section 72, the portion of such distribution rolled over to
an eligible retirement plan described in clause (i) shall be
treated as from income on the contract (to the extent of the
aggregate income on the contract from all individual
retirement plans of the distributee), and
``(III) appropriate adjustments shall be made in applying
section 72 to other distributions in such taxable year and
subsequent taxable years.''.
(d) Effective Date.--The amendments made by this section
shall apply to distributions made after December 31, 2000.
SEC. 1404. HARDSHIP EXCEPTION TO 60-DAY RULE.
(a) Exempt Trusts.--Paragraph (3) of section 402(c)
(relating to transfer must be made within 60 days of receipt)
is amended to read as follows:
``(3) Transfer must be made within 60 days of receipt.--
``(A) In general.--Except as provided in subparagraph (B),
paragraph (1) shall not apply to any transfer of a
distribution made after the 60th day following the day on
which the distributee received the property distributed.
``(B) Hardship exception.--The Secretary may waive the 60-
day requirement under subparagraph (A) where the failure to
waive such requirement would be against equity or good
conscience, including casualty, disaster, or other events
beyond the reasonable control of the individual subject to
such requirement.''.
(b) IRAs.--Paragraph (3) of section 408(d) (relating to
rollover contributions), as amended by section 1403, is
amended by adding after subparagraph (H) the following new
subparagraph:
``(I) Waiver of 60-day requirement.--The Secretary may
waive the 60-day requirement under subparagraphs (A) and (D)
where the failure to waive such requirement would be against
equity or good conscience, including casualty, disaster, or
other events beyond the reasonable control of the individual
subject to such requirement.''.
(c) Effective Date.--The amendments made by this section
shall apply to distributions after December 31, 2000.
SEC. 1405. TREATMENT OF FORMS OF DISTRIBUTION.
(a) Plan Transfers.--
(1) In general.--Paragraph (6) of section 411(d) (relating
to accrued benefit not to be decreased by amendment) is
amended by adding at the end the following:
``(D) Plan transfers.--
``(i) In general.--A defined contribution plan (in this
subparagraph referred to as the `transferee plan') shall not
be treated as failing to meet the requirements of this
subsection merely because the transferee plan does not
provide some or all of the forms of distribution previously
available under another defined contribution plan (in this
subparagraph referred to as the `transferor plan') to the
extent that--
``(I) the forms of distribution previously available under
the transferor plan applied
[[Page H7788]]
to the account of a participant or beneficiary under the
transferor plan that was transferred from the transferor plan
to the transferee plan pursuant to a direct transfer rather
than pursuant to a distribution from the transferor plan,
``(II) the terms of both the transferor plan and the
transferee plan authorize the transfer described in subclause
(I),
``(III) the transfer described in subclause (I) was made
pursuant to a voluntary election by the participant or
beneficiary whose account was transferred to the transferee
plan,
``(IV) the election described in subclause (III) was made
after the participant or beneficiary received a notice
describing the consequences of making the election,
``(V) if the transferor plan provides for an annuity as the
normal form of distribution under the plan in accordance with
section 417, the transfer is made with the consent of the
participant's spouse (if any), and such consent meets
requirements similar to the requirements imposed by section
417(a)(2), and
``(VI) the transferee plan allows the participant or
beneficiary described in subclause (III) to receive any
distribution to which the participant or beneficiary is
entitled under the transferee plan in the form of a single
sum distribution.
``(ii) Exception.--Clause (i) shall apply to plan mergers
and other transactions having the effect of a direct
transfer, including consolidations of benefits attributable
to different employers within a multiple employer plan.
``(E) Elimination of form of distribution.--Except to the
extent provided in regulations, a defined contribution plan
shall not be treated as failing to meet the requirements of
this section merely because of the elimination of a form of
distribution previously available thereunder. This
subparagraph shall not apply to the elimination of a form of
distribution with respect to any participant unless--
``(i) a single sum payment is available to such participant
at the same time or times as the form of distribution being
eliminated, and
``(ii) such single sum payment is based on the same or
greater portion of the participant's account as the form of
distribution being eliminated.''.
(2) Effective date.--The amendment made by this subsection
shall apply to years beginning after December 31, 2000.
(b) Regulations.--
(1) In general.--The last sentence of paragraph (6)(B) of
section 411(d) (relating to accrued benefit not to be
decreased by amendment) is amended to read as follows: ``The
Secretary shall by regulations provide that this subparagraph
shall not apply to any plan amendment that does not adversely
affect the rights of participants in a material manner.''.
(2) Secretary directed.--Not later than December 31, 2001,
the Secretary of the Treasury is directed to issue final
regulations under section 411(d)(6) of the Internal Revenue
Code of 1986, including the regulations required by the
amendments made by this subsection. Such regulations shall
apply to plan years beginning after December 31, 2001, or
such earlier date as is specified by the Secretary of the
Treasury.
SEC. 1406. RATIONALIZATION OF RESTRICTIONS ON DISTRIBUTIONS.
(a) Modification of Same Desk Exception.--
(1) Section 401(k).--
(A) Section 401(k)(2)(B)(i)(I) (relating to qualified cash
or deferred arrangements) is amended by striking ``separation
from service'' and inserting ``severance from employment''.
(B) Subparagraph (A) of section 401(k)(10) (relating to
distributions upon termination of plan or disposition of
assets or subsidiary) is amended to read as follows:
``(A) In general.--An event described in this subparagraph
is the termination of the plan without establishment or
maintenance of another defined contribution plan (other than
an employee stock ownership plan as defined in section
4975(e)(7)).''.
(C) Section 401(k)(10) is amended--
(i) in subparagraph (B)--
(I) by striking ``An event'' in clause (i) and inserting
``A termination''; and
(II) by striking ``the event'' in clause (i) and inserting
``the termination'';
(ii) by striking subparagraph (C); and
(iii) by striking ``or disposition of assets or
subsidiary'' in the heading.
(2) Section 403(b).--
(A) Paragraphs (7)(A)(ii) and (11)(A) of section 403(b) are
each amended by striking ``separates from service'' and
inserting ``has a severance from employment''.
(B) The heading for paragraph (11) of section 403(b) is
amended by striking ``separation from service'' and inserting
``severance from employment''.
(3) Section 457.--Clause (ii) of section 457(d)(1)(A) is
amended by striking ``is separated from service'' and
inserting ``has a severance from employment''.
(b) Effective Date.--The amendments made by this section
shall apply to distributions after December 31, 2000.
SEC. 1407. PURCHASE OF SERVICE CREDIT IN GOVERNMENTAL DEFINED
BENEFIT PLANS.
(a) 403(b) Plans.--Subsection (b) of section 403 is amended
by adding at the end the following new paragraph:
``(13) Trustee-to-trustee transfers to purchase permissive
service credit.--No amount shall be includible in gross
income by reason of a direct trustee-to-trustee transfer to a
defined benefit governmental plan (as defined in section
414(d)) if such transfer is--
``(A) for the purchase of permissive service credit (as
defined in section 415(n)(3)(A)) under such plan, or
``(B) a repayment to which section 415 does not apply by
reason of subsection (k)(3) thereof.''.
(b) 457 Plans.--Subsection (e) of section 457 is amended by
adding after paragraph (16) the following new paragraph:
``(17) Trustee-to-trustee transfers to purchase permissive
service credit.--No amount shall be includible in gross
income by reason of a direct trustee-to-trustee transfer to a
defined benefit governmental plan (as defined in section
414(d)) if such transfer is--
``(A) for the purchase of permissive service credit (as
defined in section 415(n)(3)(A)) under such plan, or
``(B) a repayment to which section 415 does not apply by
reason of subsection (k)(3) thereof.''.
(c) Effective Date.--The amendments made by this section
shall apply to trustee-to-trustee transfers after December
31, 2000.
SEC. 1408. EMPLOYERS MAY DISREGARD ROLLOVERS FOR PURPOSES OF
CASH-OUT AMOUNTS.
(a) Qualified Plans.--Section 411(a)(11) (relating to
restrictions on certain mandatory distributions) is amended
by adding at the end the following:
``(D) Special rule for rollover contributions.--A plan
shall not fail to meet the requirements of this paragraph if,
under the terms of the plan, the present value of the
nonforfeitable accrued benefit is determined without regard
to that portion of such benefit which is attributable to
rollover contributions (and earnings allocable thereto). For
purposes of this subparagraph, the term `rollover
contributions' means any rollover contribution under sections
402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and
457(e)(16).''.
(b) Eligible Deferred Compensation Plans.--Clause (i) of
section 457(e)(9)(A) is amended by striking ``such amount''
and inserting ``the portion of such amount which is not
attributable to rollover contributions (as defined in section
411(a)(11)(D))''.
(c) Effective Date.--The amendments made by this section
shall apply to distributions after December 31, 2000.
SEC. 1409. MINIMUM DISTRIBUTION AND INCLUSION REQUIREMENTS
FOR SECTION 457 PLANS.
(a) Minimum Distribution Requirements.--Paragraph (2) of
section 457(d) (relating to distribution requirements) is
amended to read as follows:
``(2) Minimum distribution requirements.--A plan meets the
minimum distribution requirements of this paragraph if such
plan meets the requirements of section 401(a)(9).''.
(b) Inclusion in Gross Income.--
(1) Year of inclusion.--Subsection (a) of section 457
(relating to year of inclusion in gross income) is amended to
read as follows:
``(a) Year of inclusion in gross income.--
``(1) In general.--Any amount of compensation deferred
under an eligible deferred compensation plan, and any income
attributable to the amounts so deferred, shall be includible
in gross income only for the taxable year in which such
compensation or other income--
``(A) is paid to the participant or other beneficiary, in
the case of a plan of an eligible employer described in
subsection (e)(1)(A), and
``(B) is paid or otherwise made available to the
participant or other beneficiary, in the case of a plan of an
eligible employer described in subsection (e)(1)(B).
``(2) Special rule for rollover amounts.--To the extent
provided in section 72(t)(9), section 72(t) shall apply to
any amount includible in gross income under this
subsection.''.
(2) Conforming amendments.--
(A) So much of paragraph (9) of section 457(e) as precedes
subparagraph (A) is amended to read as follows:
``(9) Benefits of tax exempt organization plans not treated
as made available by reason of certain elections, etc.--In
the case of an eligible deferred compensation plan of an
employer described in subsection (e)(1)(B)--''.
(B) Section 457(d) is amended by adding at the end the
following new paragraph:
``(3) Special rule for government plan.--An eligible
deferred compensation plan of an employer described in
subsection (e)(1)(A) shall not be treated as failing to meet
the requirements of this subsection solely by reason of
making a distribution described in subsection (e)(9)(A).''.
(c) Effective Date.--The amendments made by this section
shall apply to distributions after December 31, 2000.
TITLE XV--STRENGTHENING PENSION SECURITY AND ENFORCEMENT
SEC. 1501. REPEAL OF 150 PERCENT OF CURRENT LIABILITY FUNDING
LIMIT.
(a) In General.--Section 412(c)(7) (relating to full-
funding limitation) is amended--
(1) by striking ``the applicable percentage'' in
subparagraph (A)(i)(I) and inserting ``in the case of plan
years beginning before January 1, 2004, the applicable
percentage''; and
(2) by amending subparagraph (F) to read as follows:
[[Page H7789]]
``(F) Applicable percentage.--For purposes of subparagraph
(A)(i)(I), the applicable percentage shall be determined in
accordance with the following table:
``In the case of any plan year The applicable
beginning in-- percentage is--
2001........................................................160
2002........................................................165
2003......................................................170.''.
(b) Effective Date.--The amendments made by this section
shall apply to plan years beginning after December 31, 2000.
SEC. 1502. MAXIMUM CONTRIBUTION DEDUCTION RULES MODIFIED AND
APPLIED TO ALL DEFINED BENEFIT PLANS.
(a) In General.--Subparagraph (D) of section 404(a)(1)
(relating to special rule in case of certain plans) is
amended to read as follows:
``(D) Special rule in case of certain plans.--
``(i) In general.--In the case of any defined benefit plan,
except as provided in regulations, the maximum amount
deductible under the limitations of this paragraph shall not
be less than the unfunded termination liability (determined
as if the proposed termination date referred to in section
4041(b)(2)(A)(i)(II) of the Employee Retirement Income
Security Act of 1974 were the last day of the plan year).
``(ii) Plans with less than 100 participants.--For purposes
of this subparagraph, in the case of a plan which has less
than 100 participants for the plan year, termination
liability shall not include the liability attributable to
benefit increases for highly compensated employees (as
defined in section 414(q)) resulting from a plan amendment
which is made or becomes effective, whichever is later,
within the last 2 years before the termination date.
``(iii) Rule for determining number of participants.--For
purposes of determining whether a plan has more than 100
participants, all defined benefit plans maintained by the
same employer (or any member of such employer's controlled
group (within the meaning of section 412(l)(8)(C))) shall be
treated as one plan, but only employees of such member or
employer shall be taken into account.
``(iv) Plans established and maintain by professional
service employers.--Clause (i) shall not apply to a plan
described in section 4021(b)(13) of the Employee Retirement
Income Security Act of 1974.''.
(b) Conforming Amendment.--Paragraph (6) of section 4972(c)
is amended to read as follows:
``(6) Exceptions.--In determining the amount of
nondeductible contributions for any taxable year, there shall
not be taken into account so much of the contributions to one
or more defined contribution plans which are not deductible
when contributed solely because of section 404(a)(7) as does
not exceed the greater of--
``(A) the amount of contributions not in excess of 6
percent of compensation (within the meaning of section
404(a)) paid or accrued (during the taxable year for which
the contributions were made) to beneficiaries under the
plans, or
``(B) the sum of--
``(i) the amount of contributions described in section
401(m)(4)(A), plus
``(ii) the amount of contributions described in section
402(g)(3)(A).
For purposes of this paragraph, the deductible limits under
section 404(a)(7) shall first be applied to amounts
contributed to a defined benefit plan and then to amounts
described in subparagraph (B).''.
(c) Effective Date.--The amendments made by this section
shall apply to plan years beginning after December 31, 2000.
SEC. 1503. EXCISE TAX RELIEF FOR SOUND PENSION FUNDING.
(a) In General.--Subsection (c) of section 4972 (relating
to nondeductible contributions) is amended by adding at the
end the following new paragraph:
``(7) Defined benefit plan exception.--In determining the
amount of nondeductible contributions for any taxable year,
an employer may elect for such year not to take into account
any contributions to a defined benefit plan except to the
extent that such contributions exceed the full-funding
limitation (as defined in section 412(c)(7), determined
without regard to subparagraph (A)(i)(I) thereof). For
purposes of this paragraph, the deductible limits under
section 404(a)(7) shall first be applied to amounts
contributed to defined contribution plans and then to amounts
described in this paragraph. If an employer makes an election
under this paragraph for a taxable year, paragraph (6) shall
not apply to such employer for such taxable year.''.
(b) Effective Date.--The amendment made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1504. EXCISE TAX ON FAILURE TO PROVIDE NOTICE BY DEFINED
BENEFIT PLANS SIGNIFICANTLY REDUCING FUTURE
BENEFIT ACCRUALS.
(a) In General.--Chapter 43 (relating to qualified pension,
etc., plans) is amended by adding at the end the following
new section:
``SEC. 4980F. FAILURE OF APPLICABLE PLANS REDUCING BENEFIT
ACCRUALS TO SATISFY NOTICE REQUIREMENTS.
``(a) Imposition of Tax.--There is hereby imposed a tax on
the failure of any applicable pension plan to meet the
requirements of subsection (e) with respect to any applicable
individual.
``(b) Amount of Tax.--
``(1) In general.--The amount of the tax imposed by
subsection (a) on any failure with respect to any applicable
individual shall be $100 for each day in the noncompliance
period with respect to such failure.
``(2) Noncompliance period.--For purposes of this section,
the term `noncompliance period' means, with respect to any
failure, the period beginning on the date the failure first
occurs and ending on the date the failure is corrected.
``(c) Limitations on Amount of Tax.--
``(1) Overall limitation for unintentional failures.--In
the case of failures that are due to reasonable cause and not
to willful neglect, the tax imposed by subsection (a) for
failures during the taxable year of the employer (or, in the
case of a multiemployer plan, the taxable year of the trust
forming part of the plan) shall not exceed $500,000. For
purposes of the preceding sentence, all multiemployer plans
of which the same trust forms a part shall be treated as one
plan. For purposes of this paragraph, if not all persons who
are treated as a single employer for purposes of this section
have the same taxable year, the taxable years taken into
account shall be determined under principles similar to the
principles of section 1561.
``(2) Waiver by secretary.--In the case of a failure which
is due to reasonable cause and not to willful neglect, the
Secretary may waive part or all of the tax imposed by
subsection (a) to the extent that the payment of such tax
would be excessive relative to the failure involved.
``(d) Liability for Tax.--The following shall be liable for
the tax imposed by subsection (a):
``(1) In the case of a plan other than a multiemployer
plan, the employer.
``(2) In the case of a multiemployer plan, the plan.
``(e) Notice Requirements for Plans Significantly Reducing
Benefit Accruals.--
``(1) In general.--If an applicable pension plan is amended
to provide for a significant reduction in the rate of future
benefit accrual, the plan administrator shall provide written
notice to each applicable individual (and to each employee
organization representing applicable individuals).
``(2) Notice.--The notice required by paragraph (1) shall
be written in a manner calculated to be understood by the
average plan participant and shall provide sufficient
information (as determined in accordance with regulations
prescribed by the Secretary) to allow applicable individuals
to understand the effect of the plan amendment.
``(3) Timing of notice.--Except as provided in regulations,
the notice required by paragraph (1) shall be provided within
a reasonable time before the effective date of the plan
amendment.
``(4) Designees.--Any notice under paragraph (1) may be
provided to a person designated, in writing, by the person to
which it would otherwise be provided.
``(5) Notice before adoption of amendment.--A plan shall
not be treated as failing to meet the requirements of
paragraph (1) merely because notice is provided before the
adoption of the plan amendment if no material modification of
the amendment occurs before the amendment is adopted.
``(f) Applicable Individual; Applicable Pension Plan.--For
purposes of this section--
``(1) Applicable individual.--The term `applicable
individual' means, with respect to any plan amendment--
``(A) any participant in the plan, and
``(B) any beneficiary who is an alternate payee (within the
meaning of section 414(p)(8)) under an applicable qualified
domestic relations order (within the meaning of section
414(p)(1)(A)),
who may reasonably be expected to be affected by such plan
amendment.
``(2) Applicable pension plan.--The term `applicable
pension plan' means--
``(A) any defined benefit plan, or
``(B) an individual account plan which is subject to the
funding standards of section 412,
which had 100 or more participants who had accrued a benefit,
or with respect to whom contributions were made, under the
plan (whether or not vested) as of the last day of the plan
year preceding the plan year in which the plan amendment
becomes effective. Such term shall not include a governmental
plan (within the meaning of section 414(d)) or a church plan
(within the meaning of section 414(e)) with respect to which
the election provided by section 410(d) has not been made.''.
(b) Clerical Amendment.--The table of sections for chapter
43 is amended by adding at the end the following new item:
``Sec. 4980F. Failure of applicable plans reducing benefit accruals to
satisfy notice requirements.''.
(c) Effective Dates.--
(1) In general.--The amendments made by this section shall
apply to plan amendments taking effect on or after the date
of the enactment of this Act.
(2) Transition.--Until such time as the Secretary of the
Treasury issues regulations under sections 4980F(e)(2) and
(3) of the Internal Revenue Code of 1986 (as added by the
amendments made by this section), a plan shall be treated as
meeting the requirements of such sections if it makes a good
faith effort to comply with such requirements.
(3) Special rule.--The period for providing any notice
required by the amendments made by this section shall not end
before the date which is 3 months after the date of the
enactment of this Act.
[[Page H7790]]
(d) Study.--The Secretary of the Treasury shall prepare a
report on the effects of conversions of traditional defined
benefit plans to cash balance or hybrid formula plans. Such
study shall examine the effect of such conversions on longer
service participants, including the incidence and effects of
``wear away'' provisions under which participants earn no
additional benefits for a period of time after the
conversion. As soon as practicable, but not later than 60
days after the date of the enactment of this Act, the
Secretary shall submit such report, together with
recommendations thereon, to the Committee on Ways and Means
of the House of Representatives and the Committee on Finance
of the Senate.
SEC. 1505. TREATMENT OF MULTIEMPLOYER PLANS UNDER SECTION
415.
(a) Compensation Limit.--Paragraph (11) of section 415(b)
(relating to limitation for defined benefit plans) is amended
to read as follows:
``(11) Special limitation rule for governmental and
multiemployer plans.--In the case of a governmental plan (as
defined in section 414(d)) or a multiemployer plan (as
defined in section 414(f)), subparagraph (B) of paragraph (1)
shall not apply.''.
(b) Combining and Aggregation of Plans.--
(1) Combining of plans.--Subsection (f) of section 415
(relating to combining of plans) is amended by adding at the
end the following:
``(3) Exception for multiemployer plans.--Notwithstanding
paragraph (1) and subsection (g), a multiemployer plan (as
defined in section 414(f)) shall not be combined or
aggregated with any other plan maintained by an employer for
purposes of applying the limitations established in this
section, except that such plan shall be combined or
aggregated with another plan which is not such a
multiemployer plan solely for purposes of determining whether
such other plan meets the requirements of subsections
(b)(1)(A) and (c).''.
(2) Conforming amendment for aggregation of plans.--
Subsection (g) of section 415 (relating to aggregation of
plans) is amended by striking ``The Secretary'' and inserting
``Except as provided in subsection (f)(3), the Secretary''.
(c) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1506. PROHIBITED ALLOCATIONS OF STOCK IN S CORPORATION
ESOP.
(a) In General.--Section 409 (relating to qualifications
for tax credit employee stock ownership plans) is amended by
redesignating subsection (p) as subsection (q) and by
inserting after subsection (o) the following new subsection:
``(p) Prohibited Allocations of Securities in an S
Corporation.--
``(1) In general.--An employee stock ownership plan holding
employer securities consisting of stock in an S corporation
shall provide that no portion of the assets of the plan
attributable to (or allocable in lieu of) such employer
securities may, during a nonallocation year, accrue (or be
allocated directly or indirectly under any plan of the
employer meeting the requirements of section 401(a)) for the
benefit of any disqualified person.
``(2) Failure to meet requirements.--
``(A) In general.--If a plan fails to meet the requirements
of paragraph (1), the plan shall be treated as having
distributed to any disqualified person the amount allocated
to the account of such person in violation of paragraph (1)
at the time of such allocation.
``(B) Cross reference.--
``For excise tax relating to violations of paragraph (1) and
ownership of synthetic equity, see section 4979A.
``(3) Nonallocation year.--For purposes of this
subsection--
``(A) In general.--The term `nonallocation year' means any
plan year of an employee stock ownership plan if, at any time
during such plan year--
``(i) such plan holds employer securities consisting of
stock in an S corporation, and
``(ii) disqualified persons own at least 50 percent of the
number of shares of stock in the S corporation.
``(B) Attribution rules.--For purposes of subparagraph
(A)--
``(i) In general.--The rules of section 318(a) shall apply
for purposes of determining ownership, except that--
``(I) in applying paragraph (1) thereof, the members of an
individual's family shall include members of the family
described in paragraph (4)(D), and
``(II) paragraph (4) thereof shall not apply.
``(ii) Deemed-owned shares.--Notwithstanding the employee
trust exception in section 318(a)(2)(B)(i), individual shall
be treated as owning deemed-owned shares of the individual.
Solely for purposes of applying paragraph (5), this
subparagraph shall be applied after the attribution rules of
paragraph (5) have been applied.
``(4) Disqualified person.--For purposes of this
subsection--
``(A) In general.--The term `disqualified person' means any
person if--
``(i) the aggregate number of deemed-owned shares of such
person and the members of such person's family is at least 20
percent of the number of deemed-owned shares of stock in the
S corporation, or
``(ii) in the case of a person not described in clause (i),
the number of deemed-owned shares of such person is at least
10 percent of the number of deemed-owned shares of stock in
such corporation.
``(B) Treatment of family members.--In the case of a
disqualified person described in subparagraph (A)(i), any
member of such person's family with deemed-owned shares shall
be treated as a disqualified person if not otherwise treated
as a disqualified person under subparagraph (A).
``(C) Deemed-owned shares.--
``(i) In general.--The term `deemed-owned shares' means,
with respect to any person--
``(I) the stock in the S corporation constituting employer
securities of an employee stock ownership plan which is
allocated to such person under the plan, and
``(II) such person's share of the stock in such corporation
which is held by such plan but which is not allocated under
the plan to participants.
``(ii) Person's share of unallocated stock.--For purposes
of clause (i)(II), a person's share of unallocated S
corporation stock held by such plan is the amount of the
unallocated stock which would be allocated to such person if
the unallocated stock were allocated to all participants in
the same proportions as the most recent stock allocation
under the plan.
``(D) Member of family.--For purposes of this paragraph,
the term `member of the family' means, with respect to any
individual--
``(i) the spouse of the individual,
``(ii) an ancestor or lineal descendant of the individual
or the individual's spouse,
``(iii) a brother or sister of the individual or the
individual's spouse and any lineal descendant of the brother
or sister, and
``(iv) the spouse of any individual described in clause
(ii) or (iii).
A spouse of an individual who is legally separated from such
individual under a decree of divorce or separate maintenance
shall not be treated as such individual's spouse for purposes
of this subparagraph.
``(5) Treatment of synthetic equity.--For purposes of
paragraphs (3) and (4), in the case of a person who owns
synthetic equity in the S corporation, except to the extent
provided in regulations, the shares of stock in such
corporation on which such synthetic equity is based shall be
treated as outstanding stock in such corporation and deemed-
owned shares of such person if such treatment of synthetic
equity of 1 or more such persons results in--
``(A) the treatment of any person as a disqualified person,
or
``(B) the treatment of any year as a nonallocation year.
For purposes of this paragraph, synthetic equity shall be
treated as owned by a person in the same manner as stock is
treated as owned by a person under the rules of paragraphs
(2) and (3) of section 318(a). If, without regard to this
paragraph, a person is treated as a disqualified person or a
year is treated as a nonallocation year, this paragraph shall
not be construed to result in the person or year not being so
treated.
``(6) Definitions.--For purposes of this subsection--
``(A) Employee stock ownership plan.--The term `employee
stock ownership plan' has the meaning given such term by
section 4975(e)(7).
``(B) Employer securities.--The term `employer security'
has the meaning given such term by section 409(l).
``(C) Synthetic equity.--The term `synthetic equity' means
any stock option, warrant, restricted stock, deferred
issuance stock right, or similar interest or right that gives
the holder the right to acquire or receive stock of the S
corporation in the future. Except to the extent provided in
regulations, synthetic equity also includes a stock
appreciation right, phantom stock unit, or similar right to a
future cash payment based on the value of such stock or
appreciation in such value.
``(7) Regulations.--The Secretary shall prescribe such
regulations as may be necessary to carry out the purposes of
this subsection.''.
(b) Coordination With Section 4975(e)(7).--The last
sentence of section 4975(e)(7) (defining employee stock
ownership plan) is amended by inserting ``, section 409(p),''
after ``409(n)''.
(c) Excise Tax.--
(1) Application of tax.--Subsection (a) of section 4979A
(relating to tax on certain prohibited allocations of
employer securities) is amended--
(A) by striking ``or'' at the end of paragraph (1), and
(B) by striking all that follows paragraph (2) and
inserting the following:
``(3) there is any allocation of employer securities which
violates the provisions of section 409(p), or a nonallocation
year described in subsection (e)(2)(C) with respect to an
employee stock ownership plan, or
``(4) any synthetic equity is owned by a disqualified
person in any nonallocation year,
there is hereby imposed a tax on such allocation or ownership
equal to 50 percent of the amount involved.''.
(2) Liability.--Section 4979A(c) (defining liability for
tax) is amended to read as follows:
``(c) Liability for Tax.--The tax imposed by this section
shall be paid--
``(1) in the case of an allocation referred to in paragraph
(1) or (2) of subsection (a), by--
``(A) the employer sponsoring such plan, or
``(B) the eligible worker-owned cooperative,
which made the written statement described in section
664(g)(1)(E) or in section 1042(b)(3)(B) (as the case may
be), and
[[Page H7791]]
``(2) in the case of an allocation or ownership referred to
in paragraph (3) or (4) of subsection (a), by the S
corporation the stock in which was so allocated or owned.''.
(3) Definitions.--Section 4979A(e) (relating to
definitions) is amended to read as follows:
``(e) Definitions and Special Rules.--For purposes of this
section--
``(1) Definitions.--Except as provided in paragraph (2),
terms used in this section have the same respective meanings
as when used in sections 409 and 4978.
``(2) Special rules relating to tax imposed by reason of
paragraph (3) or (4) of subsection (a).--
``(A) Prohibited allocations.--The amount involved with
respect to any tax imposed by reason of subsection (a)(3) is
the amount allocated to the account of any person in
violation of section 409(p)(1).
``(B) Synthetic equity.--The amount involved with respect
to any tax imposed by reason of subsection (a)(4) is the
value of the shares on which the synthetic equity is based.
``(C) Special rule during first nonallocation year.--For
purposes of subparagraph (A), the amount involved for the
first nonallocation year of any employee stock ownership plan
shall be determined by taking into account the total value of
all the deemed-owned shares of all disqualified persons with
respect to such plan.
``(D) Statute of limitations.--The statutory period for the
assessment of any tax imposed by this section by reason of
paragraph (3) or (4) of subsection (a) shall not expire
before the date which is 3 years from the later of--
``(i) the allocation or ownership referred to in such
paragraph giving rise to such tax, or
``(ii) the date on which the Secretary is notified of such
allocation or ownership.''.
(d) Effective Dates.--
(1) In general.--The amendments made by this section shall
apply to plan years beginning after December 31, 2001.
(2) Exception for certain plans.--In the case of any--
(A) employee stock ownership plan established after July
11, 2000, or
(B) employee stock ownership plan established on or before
such date if employer securities held by the plan consist of
stock in a corporation with respect to which an election
under section 1362(a) of the Internal Revenue Code of 1986 is
not in effect on such date,
the amendments made by this section shall apply to plan years
ending after July 11, 2000.
TITLE XVI--REDUCING REGULATORY BURDENS
SEC. 1601. MODIFICATION OF TIMING OF PLAN VALUATIONS.
(a) In General.--Paragraph (9) of section 412(c)(9)
(relating to annual valuation) is amended to read as follows:
``(9) Annual valuation.--
``(A) In general.--For purposes of this section, a
determination of experience gains and losses and a valuation
of the plan's liability shall be made not less frequently
than once every year, except that such determination shall be
made more frequently to the extent required in particular
cases under regulations prescribed by the Secretary.
``(B) Valuation date.--
``(i) Current year.--Except as provided in clause (ii), the
valuation referred to in subparagraph (A) shall be made as of
a date within the plan year to which the valuation refers or
within one month prior to the beginning of such year.
``(ii) Election to use prior year valuation.--The valuation
referred to in subparagraph (A) may be made as of a date
within the plan year prior to the year to which the valuation
refers if--
``(I) an election is in effect under this clause with
respect to the plan, and
``(II) as of such date, the value of the assets of the plan
are not less than 125 percent of the plan's current liability
(as defined in paragraph (7)(B)).
``(iii) Adjustments.--Information under clause (ii) shall,
in accordance with regulations, be actuarially adjusted to
reflect significant differences in participants.
``(iv) Election.--An election under clause (ii), once made,
shall be irrevocable without the consent of the Secretary.''.
(b) Effective Date.--The amendments made by this section
shall apply to plan years beginning after December 31, 2000.
SEC. 1602. ESOP DIVIDENDS MAY BE REINVESTED WITHOUT LOSS OF
DIVIDEND DEDUCTION.
(a) In General.--Section 404(k)(2)(A) (defining applicable
dividends) is amended by striking ``or'' at the end of clause
(ii), by redesignating clause (iii) as clause (iv), and by
inserting after clause (ii) the following new clause:
``(iii) is, at the election of such participants or their
beneficiaries--
``(I) payable as provided in clause (i) or (ii), or
``(II) paid to the plan and reinvested in qualifying
employer securities, or''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2000.
SEC. 1603. REPEAL OF TRANSITION RULE RELATING TO CERTAIN
HIGHLY COMPENSATED EMPLOYEES.
(a) In General.--Paragraph (4) of section 1114(c) of the
Tax Reform Act of 1986 is hereby repealed.
(b) Effective Date.--The repeal made by subsection (a)
shall apply to plan years beginning after December 31, 2000.
SEC. 1604. EMPLOYEES OF TAX-EXEMPT ENTITIES.
(a) In General.--The Secretary of the Treasury shall modify
Treasury Regulations section 1.410(b)-6(g) to provide that
employees of an organization described in section
403(b)(1)(A)(i) of the Internal Revenue Code of 1986 who are
eligible to make contributions under section 403(b) of such
Code pursuant to a salary reduction agreement may be treated
as excludable with respect to a plan under section 401(k) or
(m) of such Code that is provided under the same general
arrangement as a plan under such section 401(k), if--
(1) no employee of an organization described in section
403(b)(1)(A)(i) of such Code is eligible to participate in
such section 401(k) plan or section 401(m) plan; and
(2) 95 percent of the employees who are not employees of an
organization described in section 403(b)(1)(A)(i) of such
Code are eligible to participate in such plan under such
section 401(k) or (m).
(b) Effective Date.--The modification required by
subsection (a) shall apply as of the same date set forth in
section 1426(b) of the Small Business Job Protection Act of
1996.
SEC. 1605. CLARIFICATION OF TREATMENT OF EMPLOYER-PROVIDED
RETIREMENT ADVICE.
(a) In General.--Subsection (a) of section 132 (relating to
exclusion from gross income) is amended by striking ``or'' at
the end of paragraph (5), by striking the period at the end
of paragraph (6) and inserting ``, or'', and by adding at the
end the following new paragraph:
``(7) qualified retirement planning services.''.
(b) Qualified Retirement Planning Services Defined.--
Section 132 is amended by redesignating subsection (m) as
subsection (n) and by inserting after subsection (l) the
following:
``(m) Qualified Retirement Planning Services.--
``(1) In general.--For purposes of this section, the term
`qualified retirement planning services' means any retirement
planning service provided to an employee and his spouse by an
employer maintaining a qualified employer plan.
``(2) Nondiscrimination rule.--Subsection (a)(7) shall
apply in the case of highly compensated employees only if
such services are available on substantially the same terms
to each member of the group of employees normally provided
education and information regarding the employer's qualified
employer plan.
``(3) Qualified employer plan.--For purposes of this
subsection, the term `qualified employer plan' means a plan,
contract, pension, or account described in section
219(g)(5).''.
(c) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1606. REPORTING SIMPLIFICATION.
(a) Simplified Annual Filing Requirement for Owners and
Their Spouses.--
(1) In general.--The Secretary of the Treasury shall modify
the requirements for filing annual returns with respect to
one-participant retirement plans to ensure that such plans
with assets of $250,000 or less as of the close of the plan
year need not file a return for that year.
(2) One-participant retirement plan defined.--For purposes
of this subsection, the term ``one-participant retirement
plan'' means a retirement plan that--
(A) on the first day of the plan year--
(i) covered only the employer (and the employer's spouse)
and the employer owned the entire business (whether or not
incorporated); or
(ii) covered only one or more partners (and their spouses)
in a business partnership (including partners in an S or C
corporation);
(B) meets the minimum coverage requirements of section
410(b) of the Internal Revenue Code of 1986 without being
combined with any other plan of the business that covers the
employees of the business;
(C) does not provide benefits to anyone except the employer
(and the employer's spouse) or the partners (and their
spouses);
(D) does not cover a business that is a member of an
affiliated service group, a controlled group of corporations,
or a group of businesses under common control; and
(E) does not cover a business that leases employees.
(3) Other definitions.--Terms used in paragraph (2) which
are also used in section 414 of the Internal Revenue Code of
1986 shall have the respective meanings given such terms by
such section.
(b) Simplified Annual Filing Requirement for Plans With
Fewer Than 25 Employees.--In the case of a retirement plan
which covers less than 25 employees on the first day of the
plan year and meets the requirements described in
subparagraphs (B), (D), and (E) of subsection (a)(2), the
Secretary of the Treasury shall provide for the filing of a
simplified annual return that is substantially similar to the
annual return required to be filed by a one-participant
retirement plan.
(c) Effective Date.--The provisions of this section shall
take effect on January 1, 2001.
SEC. 1607. IMPROVEMENT OF EMPLOYEE PLANS COMPLIANCE
RESOLUTION SYSTEM.
The Secretary of the Treasury shall continue to update and
improve the Employee Plans Compliance Resolution System (or
any successor program) giving special attention to--
(1) increasing the awareness and knowledge of small
employers concerning the availability and use of the program;
[[Page H7792]]
(2) taking into account special concerns and circumstances
that small employers face with respect to compliance and
correction of compliance failures;
(3) extending the duration of the self-correction period
under the Administrative Policy Regarding Self-Correction for
significant compliance failures;
(4) expanding the availability to correct insignificant
compliance failures under the Administrative Policy Regarding
Self-Correction during audit; and
(5) assuring that any tax, penalty, or sanction that is
imposed by reason of a compliance failure is not excessive
and bears a reasonable relationship to the nature, extent,
and severity of the failure.
SEC. 1608. REPEAL OF THE MULTIPLE USE TEST.
(a) In General.--Paragraph (9) of section 401(m) is amended
to read as follows:
``(9) Regulations.--The Secretary shall prescribe such
regulations as may be necessary to carry out the purposes of
this subsection and subsection (k), including regulations
permitting appropriate aggregation of plans and
contributions.''.
(b) Effective Date.--The amendment made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1609. FLEXIBILITY IN NONDISCRIMINATION, COVERAGE, AND
LINE OF BUSINESS RULES.
(a) Nondiscrimination.--
(1) In general.--The Secretary of the Treasury shall, by
regulation, provide that a plan shall be deemed to satisfy
the requirements of section 401(a)(4) of the Internal Revenue
Code of 1986 if such plan satisfies the facts and
circumstances test under section 401(a)(4) of such Code, as
in effect before January 1, 1994, but only if--
(A) the plan satisfies conditions prescribed by the
Secretary to appropriately limit the availability of such
test; and
(B) the plan is submitted to the Secretary for a
determination of whether it satisfies such test.
Subparagraph (B) shall only apply to the extent provided by
the Secretary.
(2) Effective dates.--
(A) Regulations.--The regulation required by paragraph (1)
shall apply to years beginning after December 31, 2000.
(B) Conditions of availability.--Any condition of
availability prescribed by the Secretary under paragraph
(1)(A) shall not apply before the first year beginning not
less than 120 days after the date on which such condition is
prescribed.
(b) Coverage Test.--
(1) In general.--Section 410(b)(1) (relating to minimum
coverage requirements) is amended by adding at the end the
following:
``(D) In the case that the plan fails to meet the
requirements of subparagraphs (A), (B) and (C), the plan--
``(i) satisfies subparagraph (B), as in effect immediately
before the enactment of the Tax Reform Act of 1986,
``(ii) is submitted to the Secretary for a determination of
whether it satisfies the requirement described in clause (i),
and
``(iii) satisfies conditions prescribed by the Secretary by
regulation that appropriately limit the availability of this
subparagraph.
Clause (ii) shall apply only to the extent provided by the
Secretary.''.
(2) Effective dates.--
(A) In general.--The amendment made by paragraph (1) shall
apply to years beginning after December 31, 2000.
(B) Conditions of availability.--Any condition of
availability prescribed by the Secretary under regulations
prescribed by the Secretary under section 410(b)(1)(D) of the
Internal Revenue Code of 1986 shall not apply before the
first year beginning not less than 120 days after the date on
which such condition is prescribed.
(c) Line of Business Rules.--The Secretary of the Treasury
shall, on or before December 31, 2000, modify the existing
regulations issued under section 414(r) of the Internal
Revenue Code of 1986 in order to expand (to the extent that
the Secretary determines appropriate) the ability of a
pension plan to demonstrate compliance with the line of
business requirements based upon the facts and circumstances
surrounding the design and operation of the plan, even though
the plan is unable to satisfy the mechanical tests currently
used to determine compliance.
SEC. 1610. EXTENSION TO ALL GOVERNMENTAL PLANS OF MORATORIUM
ON APPLICATION OF CERTAIN NONDISCRIMINATION
RULES APPLICABLE TO STATE AND LOCAL PLANS.
(a) In General.--
(1) Subparagraph (G) of section 401(a)(5) and subparagraph
(H) of section 401(a)(26) are each amended by striking
``section 414(d))'' and all that follows and inserting
``section 414(d)).''.
(2) Subparagraph (G) of section 401(k)(3) and paragraph (2)
of section 1505(d) of the Taxpayer Relief Act of 1997 are
each amended by striking ``maintained by a State or local
government or political subdivision thereof (or agency or
instrumentality thereof)''.
(b) Conforming Amendments.--
(1) The heading for subparagraph (G) of section 401(a)(5)
is amended to read as follows: ``Governmental plans''.
(2) The heading for subparagraph (H) of section 401(a)(26)
is amended to read as follows: ``Exception for governmental
plans''.
(3) Subparagraph (G) of section 401(k)(3) is amended by
inserting ``Governmental plans.--'' after ``(G)''.
(c) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 2000.
SEC. 1611. NOTICE AND CONSENT PERIOD REGARDING DISTRIBUTIONS.
(a) Expansion of Period.--
(1) In general.--Subparagraph (A) of section 417(a)(6) is
amended by striking ``90-day'' and inserting ``180-day''.
(2) Modification of regulations.--The Secretary of the
Treasury shall modify the regulations under sections 402(f),
411(a)(11), and 417 of the Internal Revenue Code of 1986 to
substitute ``180 days'' for ``90 days'' each place it appears
in Treasury Regulations sections 1.402(f)-1, 1.411(a)-11(c),
and 1.417(e)-1(b).
(3) Effective date.--The amendment made by paragraph (1)
and the modifications required by paragraph (2) shall apply
to years beginning after December 31, 2000.
(b) Consent Regulation Inapplicable to Certain
Distributions.--
(1) In general.--The Secretary of the Treasury shall modify
the regulations under section 411(a)(11) of the Internal
Revenue Code of 1986 to provide that the description of a
participant's right, if any, to defer receipt of a
distribution shall also describe the consequences of failing
to defer such receipt.
(2) Effective date.--The modifications required by
paragraph (1) shall apply to years beginning after December
31, 2000.
TITLE XVII--PLAN AMENDMENTS
SEC. 1701. PROVISIONS RELATING TO PLAN AMENDMENTS.
(a) In General.--If this section applies to any plan or
contract amendment--
(1) such plan or contract shall be treated as being
operated in accordance with the terms of the plan during the
period described in subsection (b)(2)(A); and
(2) such plan shall not fail to meet the requirements of
section 411(d)(6) of the Internal Revenue Code of 1986 by
reason of such amendment.
(b) Amendments to Which Section Applies.--
(1) In general.--This section shall apply to any amendment
to any plan or annuity contract which is made--
(A) pursuant to any amendment made by this Act, or pursuant
to any regulation issued under this Act, and
(B) on or before the last day of the first plan year
beginning on or after January 1, 2003.
In the case of a governmental plan (as defined in section
414(d) of the Internal Revenue Code of 1986), this paragraph
shall be applied by substituting ``2005'' for ``2003''.
(2) Conditions.--This section shall not apply to any
amendment unless--
(A) during the period--
(i) beginning on the date the legislative or regulatory
amendment described in paragraph (1)(A) takes effect (or in
the case of a plan or contract amendment not required by such
legislative or regulatory amendment, the effective date
specified by the plan); and
(ii) ending on the date described in paragraph (1)(B) (or,
if earlier, the date the plan or contract amendment is
adopted),
the plan or contract is operated as if such plan or contract
amendment were in effect; and
(B) such plan or contract amendment applies retroactively
for such period.
Parliamentary Inquiry
Mr. RANGEL. Mr. Speaker, a parliamentary inquiry.
The SPEAKER pro tempore. The gentleman will state his inquiry.
Mr. RANGEL. Mr. Speaker, is it within the rules of this House under
the suspension of the rules that we can bring legislation before us
that has already passed the House of Representatives?
We have two bills that have already passed the House and now they are
coming back. Is it within the rules of the House that we can repass
same bills, the same form without any changes?
The SPEAKER pro tempore. Under suspension of the rules, there is no
prohibition against that.
Mr. RANGEL. No prohibition?
The SPEAKER pro tempore. Under the rules of the House, there is no
prohibition.
Mr. RANGEL. Okay, Mr. Speaker, I withdraw my parliamentary inquiry.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Florida (Mr. Shaw) and the gentleman from New York (Mr. Rangel) each
will control 20 minutes.
The Chair recognizes the gentleman from Florida (Mr. Shaw).
General Leave
Mr. SHAW. Mr. Speaker, I ask unanimous consent that all Members may
have 5 legislative days within which to revise and extend their remarks
and include extraneous material on H.R. 5203.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Florida?
There was no objection.
Mr. SHAW. Mr. Speaker, I yield myself such time as I may consume.
[[Page H7793]]
Mr. Speaker, I think perhaps my statement might very well clarify
things for my friend, the gentleman from New York (Mr. Rangel). One may
ask why we are bringing up and voting on a bill that includes the
legislation which so overwhelmingly passed this House yesterday under
suspension of the rules by a vote of 381 to 3, along with the popular
pension reform legislation which earlier passed by a vote of 401 to 25
and had at least 181 cosponsors including 81 House Democrats.
At a time when Washington reporters like to talk about partisan
maneuvering at the end of a season to get Members out of town and back
home to their districts, I would like to point out how hard the
sponsors of this bill are working, including the Democrats and
Republicans alike, the gentleman from Maryland (Mr. Cardin), the
gentleman from Ohio (Mr. Portman), the gentleman from California (Mr.
Herger), and the gentleman from Kentucky (Mr. Fletcher), we are working
towards bipartisan solutions to important issues on which we agree.
We are delivering this to the American people in these closing days
of this session of this Congress, but the reason we are taking a series
of votes on the same or similar legislation is it that we need to be
sure that some form of these important solutions get passed by the
other Chamber and get signed into law by the President.
Mr. Speaker, I know that a lot of negotiations are going on along
Pennsylvania Avenue on a variety of issues, but we are producing
results on these items that are most important to the people, the
people that I represent in the State of Florida; protecting Social
Security and Medicare, protecting and enhancing their retirement
security, and protecting our hard-earned money from wasteful Washington
spenders.
Make no mistake, over the last 6 years, the Republicans have done
most of the heavy lifting in cutting wasteful Washington spending and
bringing the budget into balance. Now, that there is a surplus,
Republicans have begun the process of responsibly paying down the
national debt, while protecting Social Security and Medicare and
keeping our economy strong so that future generations of Americans
inherit a Nation that is free of debt with a healthy thriving economy.
In accomplishing this major feat, which less than a decade ago,
seemed impossible, Republicans have adhered to some basic principles
which continue to guide us as we prepare to address the challenges
ahead of us, and that is saving Social Security and Medicare for future
generations.
These are our basic principles, one, payroll taxes belong to the
people who pay into the system, not to the government. Two, the best
way to keep Washington from spending more is to take surplus cash off
the table and store it in a lockbox that can only be used for Social
Security, Medicare or debt reduction. Three, long-term overpayments by
taxpayers should be given back to taxpayers in the form of tax relief
not co-opted by those in Washington who want to spend more.
So it is logical that as we try to keep our economy strong and keep
hard-earned dollars in the hands of the wage earners of this country,
we focus on pension reform and other components of this goal.
Increasing the savings stimulates the economic growth, reducing the
government's take on a person's savings and earnings encourages people
to save, leaving them more of their savings to keep them through their
retirement years.
{time} 1415
It is no wonder why both these bills are so popular. The question is,
why are we having trouble getting similar legislation moved through the
other Chamber and on to the President's desk? These are the specific
reasons we are bringing up this bill today.
First, we want to try again to break the logjam in the other body on
moving forward with the Social Security and Medicare lockbox.
Republicans have been pushing for this legislation since early last
year but have been stonewalled by the minority. Everyone from the
President to the Vice President says they want this but the minority in
the other body continues to block its consideration.
We hope that they are not part of some larger political game; that
they will finally agree to the lockbox and get this bill signed into
law.
Second, Republicans want to set aside $42 billion of the FY 2001
surplus right now for debt relief so that those funds cannot be spent
on more government programs. We should not use the surplus to make
government bigger; we should use it to make the national debt smaller.
We would invite the President and our colleagues in the other body to
join us in this historic effort to use 90 percent of the surplus for
debt relief.
Here is what our lockbox does, and, again, it is identical to the
legislation that we have previously passed: one, it sets aside $240
billion for debt reduction for FY 2001 alone. That is 90 percent of the
entire surplus in FY 2001 dedicated to paying down the publicly held
debt and putting us on to the path of eliminating the debt by the year
2012 or perhaps even sooner. It sets aside 100 percent of the Social
Security surplus to pay down the debt until we pass legislation that
actually saves Social Security. That is $165 billion of debt reduction
in fiscal year 2001 and $2.4 trillion over the next 10 years; $2.4
trillion.
It sets aside 100 percent of the Medicare surplus to pay down the
debt until we pass legislation that saves Medicare. That is another $32
billion of debt reduction in fiscal year 2001, and another $360 billion
over the next 10 years. It sets aside an additional $42 billion of the
non-Social Security and non-Medicare surplus for debt reduction. An
additional $42 billion of the on-budget surplus would be set aside for
debt reduction in a special account in Treasury.
The bill is good for millions of Americans, especially working women
who have no pension or have inadequate pension coverage today. As we
will hear from other speakers today describe in even more detail, we
raise the limit of IRAs from $2,000 to $5,000. As we all know, the IRAs
are one of the most popular and successful programs ever conceived. As
inflation has caught up with the value of the original amount people
can set aside, that is $1,500 in 1974 raised to $2,000 in 1981, it
makes sense to allow people to do more to save for retirement.
Our bill similarly updates 401(k) amounts and improves portability so
one can take their retirement nest egg with them when they move from
job to job, which is even a greater incentive for younger Americans to
start planning for their future earlier.
Only half of all private sector workers have any kind of pension and
only 20 percent of small business offer retirement plans. So the
ability to design an individual program and carry their savings with
them is as important as our effort to protect pension plans from the
burdens of overtaxation. But do not forget, every single individual in
this country stands to benefit from this bill because we will be
protecting future generations from debt. We will be making retirement
savings grow for workers of all ages, and we will be helping keep hard-
earned dollars in the hands of taxpayers rather than sending them to
Washington.
When given the choice to put dollars in the hands of Washington or
keeping them in the pockets of people living in Florida, I would choose
to trust my constituents any day.
Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, my friend, the gentleman from Florida (Mr. Shaw), and he
is my friend, has spent a lot of time talking about the merits of these
two bills that are before the House on the suspension calendar.
Throughout his support, he mentions Republicans a half a dozen times,
which I can understand, it is that time of the year and he needs all
the help he can get. My problem is, he would have us to believe that
these two bills that passed this House overwhelmingly in a bipartisan
way is just not enough to move his Republican leaders on the other side
of this building. And so if this is so, then we will be using the
suspension calendar for everything that we do not like the progress of
a piece of legislation to move Republicans that are not in this
Chamber, which I think is an abuse of the privilege of the suspension
calendar. But that is a political matter.
What I am concerned about, as a member of the Committee on Ways and
Means, is that there is a lot of talk about this new bill, H.R. 5203,
being the
[[Page H7794]]
same as the House-passed bill, H.R. 5173. Since the new bill is still
warm in my hand as it comes off the press, and we saw it at noontime,
there may be a similarity in substance; but there is a heck of a lot of
difference in terms of language. There are changes in this bill that
may be technical, but there are 135 lines of the new bill that is
shorter than what we had in the old bill.
Now, I know that some Republican expert decided which was good and
which was bad, and the gentleman has a lot of time left, and I know he
will explain why we do have at least in terms of numbers and pages a
different bill. But another thing bothers me and that is if we do have
a very important piece of legislation and they both concern the
Committee on Ways and Means, and we did have an amendment to the bill
when it was in the House that would allow lower-income people to have
incentives for savings, why would not this bill, if it had to be
revisited, why would it bypass the Committee on Ways and Means? Why
would we have something that we have not even had our staffs to read,
since it has just been out a couple of hours? Why do we have this
urgency to get this thing done with such speed, in view of the fact
that our committee has no work before it?
We do not get a chance to have a motion to recommit on the suspension
calendar. We do not have a chance to see whether we can improve this
bill. It is not the identical bill that we passed here before. The
staff knows that. I am just saying that when one takes popular ideas
and believe that each time they find us supporting something they can
call it bipartisan, that it has to keep on getting passed, it is not
right.
Democrats have worked with my colleagues on the other side of the
aisle on the legislation, and we still think that it can be improved;
but since they have given up on tax cuts and have moved swiftly to
budget gimmicks, I thought we had really done all that we could the
last time this thing came up, where we are now doing by legislation
what President Clinton has been doing by making certain the Federal
debt is being paid down.
I do not know how far we have to go with this type of procedures on
the floor. Democratic support was gotten before. Democratic support has
to be gotten now. Since the parliamentarians indicated that this can be
brought up as often as the other side wants on the suspension calendar,
maybe we will have other bills that we have joined together in passing.
I might suggest, though, being in the minority, one of the ways that
action might be gotten from the other body is for Republicans here to
talk to Republicans there.
Mr. Speaker, I reserve the balance of my time.
Mr. SHAW. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would like to say to my friend, the gentleman from New
York (Mr. Rangel), he has known me long enough to know that I am a man
of my word; and I can assure him that these bills are exactly what the
gentleman has already supported in the committee and that he has
already supported on the floor.
I think the gentleman knows that when we get into the closing days,
perhaps he knows better than I do, the negotiations that are going on.
Two bills as important as these bills are, to merge them together,
gives us just another option in which to get these matters before the
Senate, to the conference, and to the President's desk for signature.
Mr. Speaker, I yield 4 minutes to the gentleman from Ohio (Mr.
Portman), the author of the pension portion of this bill.
(Mr. PORTMAN asked and was given permission to revise and extend his
remarks.)
Mr. PORTMAN. Mr. Speaker, I thank the chairman, the gentleman from
Florida (Mr. Shaw), very much for yielding me this time; and I thank
him for bringing this bill, H.R. 5203, to the floor today.
It is the Debt Relief and Retirement Security Reconciliation Act of
2000, and it is designed to give reconciliation protection to
legislation we have already passed for the purpose of negotiating with
the Senate to move this process forward and to get these bills enacted
this year.
The first is the debt lockbox legislation that puts 90 percent of
this year's budget surplus projected for 2001 into debt relief, and
then second of course is the bipartisan retirement security legislation
that we have passed in this House by a vote of 401 to 25, which expands
and strengthens IRAs, 401(k)s and other pensions.
I would like to focus, if I could, this afternoon on the retirement
security package that is before us. This is bipartisan legislation that
my friend and colleague, the gentleman from Maryland (Mr. Cardin), and
I have worked on over the last 3 years. It is very important. It is
very important we get it enacted and do so this year. We need to do all
we can because there is a real retirement security crunch out there.
Seventy million Americans, about half the workforce, do not have any
kind of a pension at all today, not even a 401(k), nothing. The problem
is even worse among small businesses. We are told that less than 20
percent of small businesses, Mr. Speaker, that is with businesses of 25
or fewer employees, offer any kind of pension coverage today.
Now, this is at a time when private savings in this country is
dangerously low. In fact, last month we are told that our savings rate
in this country was actually negative. This, of course, hurts our
economy. It presents a real danger to our economy moving forward, but
it also hurts people; it hurts individuals. Experts tell us that older
baby-boomers, for instance, have put only 40 percent aside of what they
will need for a financially secure retirement. So it is time to take
action, and it is time to do it now.
Part of the problem we have had over the years is right here in
Congress. Over the last 20 years, Congress has made pensions less
generous by lowering the contribution of benefit levels, believe it or
not, and while making pension benefits lower they have also made
pensions more costly to offer by increasing the number of rules and
regulations on employers.
Let me say what kind of impact that has had. Let me give a specific
example. From 1982 to 1994, the limits on defined benefit plans were
repeatedly reduced by Congress and new restrictions were added,
primarily for the purpose of generating Federal revenue, by the way.
This was not a policy decision that had to do with pensions. It had to
do with at that time addressing the deficit. As these cutback from 1982
to 1994 took effect, the number of traditional defined benefit plans
insured by PBGC dropped from 114,000 plans in 1987 to 45,000 plans in
1997. These are the facts. They speak for themselves.
During the past 2 decades, overall pension coverage has remained
stagnant, even when the defined contribution side is included.
Obviously, it is past time for Congress to reverse these trends, and
the bill before us today does just that. It is a comprehensive
approach. It has been developed over the last 3 years with careful
consultation with small businesses, labor organizations like the
building trades department of the AFL-CIO. It has also been worked on
by pension law experts in the private sector, academia and the
administration. Most importantly, we have looked to and taken the
advice of workers themselves, folks who are in pension plans, to see
how they could be improved. They have been fully vetted. About 200
Members of this House, almost equally divided between Republicans and
Democrats, have cosponsored the bill and more than 85 outside groups
have endorsed it. The approach is fiscally responsible, and it is very
straightforward.
It falls in basically three categories. First, we allow all workers
to set aside more money for their retirement. That means setting aside
more money in a 401(k)-type plan, in a union, multiemployer-type plan,
a defined benefit plan and all other pensions. It also means setting
more money aside in an IRA. In most cases, very importantly, all we are
doing is trying to restore those limits to where they were before the
Congress reduced them.
For example, moving the IRA contribution levels from $2,000 to $5,000
is about where it would have been had it been indexed to inflation in
the 1970s. We also allow special catch-up contributions that help
workers over 50 set aside even more for retirement.
These accelerated contributions will allow older workers--especially
women returning to the workforce--the opportunity to build up a
retirement nest egg more quickly--at a time in
[[Page H7795]]
their lives when their earnings are relatively high and when they most
need to save for retirement.
Second, we're modernizing pension laws to adapt to what we've learned
about the realities of an increasingly mobile workforce. So, we make
defined contributions plans portable so workers can roll-over their
retirement nest egg between various types of qualified plans--including
401(k), 403(b) and 457 plans. And, we require employers to allow
workers to become vested in their pension plans more quickly--in 3
years rather than the current-law 5.
Finally, we listened to those in the trenches, and we responded to
the surveys that clearly demonstrate that we must reduce the
complexities and red tape in current law if we are going to expand
pension opportunities for those who work for small businesses. That's
why we make it easier for employers--particularly small businesses--to
establish and maintain pension plans by reducing costs and
liabilities--including modernizing outdated laws and streamlining
complex rules. Yet, we keep in place the important protections that
ensure families fairness in our pension system.
Despite the overwhelming and broad-based support for this
legislation, there are some in the Administration who call this package
a ``tax cut for the rich.'' That's wrong. Why should they tell working
Americans--who are struggling to save for retirement--that the $2,000
limit on IRA contributions established in 1981 makes sense today? Why
should they tell working Americans that they can save less in a 401(k)
plan than they could in the 1980s?
Remember who benefits here--77 percent of American workers currently
participating in a pension plan make less than $50,000 per year. By
expanding retirement savings options, we'll be helping those workers
who need the most help in saving for retirement.
I urge my colleagues to join us today in sending a strong bipartisan
message to the Senate--and to the White House--that we are committed to
helping all Americans have more peace of mind--and more financial
security--in their retirement years. Let's pass this package again.
{time} 1430
Mr. RANGEL. Mr. Speaker, I yield 4 minutes to the gentleman from
Washington (Mr. McDermott), a member of the Committee on Ways and Means
and a member of the Committee on the Budget.
Mr. McDERMOTT. Mr. Speaker, coming over here today, having been over
here yesterday when half of this bill passed the last time, I could not
help thinking of what, I think it was Groucho Marx said, that if you
are going to go into politics, the first thing you have to learn to do
is to act sincere. Because if we are going to come out here with this
kind of legislation, we really have to work pretty hard to keep a
straight face.
Yesterday we passed the bill on this lockbox on debt repayment, which
is a totally useless piece of legislation. It is not necessary; the
debt is being paid down without any such process now. But it was a
pretty good press release yesterday. So they thought, well, let us do
it again tomorrow. Since we are not doing anything worthwhile anyway,
we might as well have something to put into our press release machine
to fire out at the newspapers all over the country, and that is a good
one, and oh, yeah, there is that pension thing, we can pass that too.
Why do we not staple those bills together, because it will be
different. They cannot say we are bringing out the same bill as we
brought out yesterday; we are bringing out the same bill yesterday,
plus the same bill from July 19.
Now, you say, why do we pick July 19? Well, we think about it and we
say to ourselves, they must be bringing out the July 19 bill because
they did it in the middle of the summer and people have forgotten about
it, and today we are 49 days from election and we have to be sure and
remind the people of the good legislation we passed that the majority
in the other body killed, so we do not get blamed for it.
Mr. Speaker, the real irony of this thing is we have the majority
party in the House who cannot seem to get the majority party in the
other body to pay attention to them. We fire this nonsense over there
and they put it in a desk drawer and it never sees the light of day
again. This is an intra-party fight inside the majority party. That is
why we will probably be out here tomorrow with the debt reduction bill
and, let us see, we could marry it up to the estate tax removal. That
would be a good one to put out here. Then, on Thursday we can bring out
the debt reduction bill and the marriage tax penalty bill. Now, let me
think. I will sit down over here and come up with the list for next
week. Because we have not passed the appropriation acts, we have not
had any conference committees on the budget, so we have to come out
here and do these little shows.
Now, I think the American people are smarter than some people in this
place give them credit for. They will see this; they are not going to
forget that yesterday they read about the debt reduction bill and they
are going to think they got the same paper 2 days in a row. Right there
on the front pages, Republicans plan to spend 90 percent of the money
in the surplus on paying down the debt. They cannot do it, because they
already passed enough tax breaks to use up 22 percent; they cannot use
90 percent and 22 percent. If we add 90 and 22, that makes 112 percent
of the surplus.
Now, I am not quite sure who teaches math over in the other caucus,
but they need a new calculator, because it does not work. But, with a
very straight face and acting very sincere, people stand down here and
tell us that we can do it. I suppose if one believes that, one could
believe in buying the Brooklyn Bridge or a whole lot of other things.
The only things we have passed here in the last few days has been
naming new bridges and new courthouses and new highways and this kind
of stuff, part of which is legislative nonsense, and the other part is
a decent bill. But the people are not going to be fooled by this press
release.
Mr. SHAW. Mr. Speaker, I yield myself such time as I may consume to
remind the gentleman from Washington that in the other body, it is the
other party that has been filibustering the lockbox legislation.
Perhaps this will break something loose over there. It is very good
bipartisan legislation in this body, but in the other body it has not
worked that way.
Mr. Speaker, I yield 2 minutes to the gentleman from California (Mr.
Herger), the author of the lockbox legislation.
Mr. HERGER. Mr. Speaker, I rise in strong support of this measure.
This bill increases IRA contribution limits from $2,000 to $5,000,
making it easier for Americans to save. This measure also includes two
provisions I introduced, the Social Security lockbox, which passed the
House last year by a 416-to-12 vote, and the Medicare lockbox, which I
introduced in March and passed the House this June by a 420-to-2 vote.
Mr. Speaker, for the first time, these lockboxes will protect 100
percent of trust fund surpluses from spending on other unrelated
government programs. Ending the raid on the Social Security and
Medicare trust funds is the right thing to do. This legislation also
creates another lockbox in which $42 billion additional surplus dollars
will be held only for debt reduction. All in all, this legislation will
use 90 percent, or $240 billion to pay down public debt this year
alone. Never in the history of our Nation has a Congress paid down this
much public debt in a single year.
Today, we made debt reduction the priority, not the afterthought.
This bill is the epitome of sound fiscal policy. For individual
Americans, we increase opportunities to save; for the government's
part, we protect the Social Security and Medicare trust funds for the
first time from raids and still pay down $240 billion in public debt.
This bill is a win-win for fiscal responsibility, a win-win for our
children, a win-win for our seniors, and a win-win for the best
interests of the United States. I urge my colleagues to vote for this
measure.
Mr. RANGEL. Mr. Speaker, I yield 4 minutes to the gentleman from
Michigan (Mr. Levin), a senior member of the Committee on Ways and
Means.
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
Mr. LEVIN. Mr. Speaker, this session is descending into utter
confusion, and if it is confusing here, we can imagine what the public
thinks.
The Republican majority here in the House has moved from pillar to
post. First a $900 billion tax cut, much of it for the very wealthy,
eating up a good portion of the nonSocial Security surplus. Well, that
did not fly, so now we have a proposal, 90 percent of the surplus for
debt retirement. So we go from $900 billion in an unworkable tax
proposal to 90 percent of that surplus, that
[[Page H7796]]
would have been used up in large measure by the tax bill, now for debt
retirement.
Well, to add to the confusion, we now have this bill tied into
another bill, and what could be the reason for it? The gentleman from
Ohio talked about how it was necessary for budget reconciliation, he
used those terms. Let me just read a statement on this point that we
have worked on with the staff and I would like to have someone refute
it if it is wrong.
The debt reduction lockbox provisions in H.R. 5203 are in no way,
shape or form a reconciliation bill in the Senate. The Senate had no
budget reconciliation instructions for debt reduction. Among other
things, the debt reduction provisions violate the Byrd Rule in the
Senate and section 306 of the Budget Act which protects the
jurisdiction of the budget committees. As such, a motion to proceed to
consideration of such a bill under budget reconciliation rules could be
filibustered in the Senate. What the House is doing is converting the
House-passed pension IRA bill into a nonreconciliation bill for the
Senate. So this bill is not only confusing, it is counterproductive.
Well, what is the second reason given for combining these bills? It
is said it is to get the attention of the Senate. How about e-mail or
the telephone, or just walk across the rotunda and sit down with the
majority leader in the Senate and we will be glad to join with the
White House, and let us get busy and do some work and pass some
legislation.
What we are doing here is treading water while the session is
sinking. It just does not make any sense, as the gentleman from New
York (Mr. Rangel) said. We Democrats are ready to work. We are ready to
move on. We are ready to pass legislation and not to add to an already
confusing situation.
Mr. SHAW. Mr. Speaker, I yield 2 minutes to the gentleman from Texas
(Mr. DeLay).
Mr. DeLAY. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, it is not confusing. The Republicans are committed to
empowering American families by returning power, money and choices to
the people. We do not believe that the Federal budget surplus belongs
to the government. It is the people's money, and it should be returned.
They earned it.
This is our constant and unchanging goal. That is why we proposed a
firm commitment that applies at least 90 percent of next year's Federal
budget surplus to paying off our debts. It turns out that a commitment
to paying off the debt is a popular position. Last night, we forged a
common sense coalition for debt relief. We drew support from both sides
of the aisle. We believe that the surplus must be returned to the
American people, if not through tax relief, then through debt
reduction.
Today, we take another important step. Members have another
opportunity to send a very clear message to the White House. The
American people demand greater fiscal discipline from their government.
An unrestrained wave of new Washington spending is not an acceptable
use for their surplus. Our latest initiative addresses this theme of
fiscal discipline by both expanding retirement security and paying off
the debt. We can again urge the President to join with us, but our
expectations are pretty low.
The President has already repeatedly blocked the bipartisan effort to
return the surplus to the American people. Just last week he said,
whether we can do debt reduction this year or not depends upon what the
various spending commitments are. Less than 24 hours ago, this House
voted overwhelmingly in favor of our debt reduction plan. Now every
Member, Republican and Democrat, who voted for that initiative should
support this common sense measure.
Mr. President, we have room for you in our common sense coalition to
refund the surplus, but you must first abandon any scheme to spend the
surplus on more Washington programs. If you can commit to using at
least 90 percent of next year's surplus to debt relief and only debt
relief, we would like to have you with us.
Mr. Speaker, members should support this bill. It will return power
to the American people and strengthen our Nation.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore. Members are reminded to address their
remarks to the Chair.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
The majority whip has now confused me. I understood from the
gentleman from Texas (Mr. Archer), the chairman of the Committee on
Ways and Means, that we were relegislating this old legislation to send
a message to the Republican leaders on the other side. However, now the
majority whip wants to send a message to the President of the United
States. This is really getting confusing. I mean have we given up all
methods of communication completely? I know it is bad, but we do not
have to legislate to talk to President Clinton. We can do these things
directly. We can sit down today or tomorrow and work out how we can get
some legislation passed and signed into law instead of getting out
these press releases.
The next speaker on this side is the coauthor of this bipartisan
piece of legislation that overwhelmingly passed the House, and he
worked closely with the gentleman from Ohio (Mr. Portman). I do not
know how many times we are going to drag out the gentleman from Ohio
(Mr. Portman) and the gentleman from Maryland (Mr. Cardin) here to show
that some people do talk with each other on the House side, but I hope
my Republican colleagues keep doing it until they get it right, because
some of us have to get out of here and get back home.
Mr. Speaker, I yield such time as he may consume to the gentleman
from Maryland (Mr. Cardin).
Mr. CARDIN. Mr. Speaker, let me thank the gentleman from New York
(Mr. Rangel) for yielding me this time. Let me assure our colleagues
that there is strong bipartisan support for the provisions that are
contained in this bill that is before us.
{time} 1445
Many of us, including this Member, is confused on the process. I
listened also to the distinguished majority whip explain what this bill
is intended to do, and I do not believe that is included in the
legislation before us. So I am confused on the process that we are
using, but I hope it is an effort that will allow us to enact some very
important legislation.
I listened to the explanation on the lockbox, and I must tell my
colleagues that I am confused on the explanation on the lockbox. As I
understand, it is a 1-year bill. And we are going to be judged by our
actions on the appropriation bills and on the tax bills, not on the
lockbox. Let us be clear about that.
I hope at the end of the day that we can say as Democrats and
Republicans that we have put as our first priority retiring our debt,
which is exactly what the President of the United States has asked us
to do, to make the top priority the reduction of our debt with the
surplus funds.
Let me speak for a moment, if I might, about the pension legislation.
The gentleman from New York (Mr. Rangel) is correct, this bill has been
worked very carefully on a bipartisan basis. I thank my colleague, the
gentleman from Ohio (Mr. Portman), for his leadership on this.
Democrats and Republicans joined together in crafting this bill and in
passing this bill by 401 votes. I would hope that by bringing it up
again today it is a message that we intend to send to the President of
the United States a bill that deals with pensions and is not loaded up
with other issues that would make it impossible for us to get it
enacted this year.
As the gentleman from Ohio (Mr. Portman) has pointed out, it is
important legislation because it is very comprehensive legislation that
will not only increase the limits but will help employers provide
employer-sponsored pension plans for their employees, which help lower-
wage workers because the employer puts the money on the table, making
it easier for low-wage workers to put money away for their own
retirement.
We deal with portability and the realization that the current
workforce holds people that will work for more than one employer in
their work life, so they need to be able to combine their funds. We
remove a lot of the obstacles that make it difficult for employers to
sponsor pension plans. We make it easier for individuals to put more
money away for themselves to address the critical need in this Nation
to increase the savings rates.
[[Page H7797]]
So I hope at the end of the day that we will be able to come together
with a bill that is enacted and sent to the President. And if we can
keep it to the pension issues alone, if we do not get confused with
some of the other politics around here, I think we can achieve that.
But I would urge my friends on the other side of the aisle to work
with us on the process issues. It is somewhat confusing to us to wake
up in the morning only to find legislation that we thought already was
completed in this body has once again been brought up for initial
action rather than being sent to the President for signature.
Mr. SHAW. Mr. Speaker, I yield 1 minute to the gentleman from
Michigan (Mr. Smith).
Mr. SMITH of Michigan. Mr. Speaker, encouraging savings and
investment and not leaving our kids and our grandkids with a huge
mortgage is a reasonable combination in this piece of legislation.
On September 13, the President said, in regard to paying down the
debt, and I quote from the New York Times, ``Whether we can do it this
year or not depends upon what the various spending commitments are.''
He may have very well said, ``I have other plans for this money.''
Today, this House makes spending commitments under this bill. We are
committed to paying down the debt. Maybe we could do more. I would have
liked to have done more. But the problem is that we have to make a
commitment to do it, otherwise the propensity to spend by the President
and by this Congress is too great.
Let us pass this legislation to help assure we don't simply increase
spending. The President sent us the Democrat budget proposal last
spring that increased spending $100 billion more than could be paid for
with projected revenues. That meant that without increased taxes and
increased revenues, it would have used the Social Security and the
Medicaid trust fund surpluses.
Let us pass this bill and move ahead. Let us make sure saving and
investment is easier for the American people and we do not leave our
kids with a bigger mortgage.
Mr. SHAW. Mr. Speaker, I yield 1 minute to the gentleman from
Illinois (Mr. Weller), a member of the Committee on Ways and Means.
Mr. WELLER. Mr. Speaker, this is important legislation that we are
voting on today. I strongly support setting aside 90 percent of the
projected budget surplus to pay down the national debt. Of course, our
goal is not only to build on the $360 billion in debt retirement we
have already accomplished in the last 3 years, but to pay off the
national debt by the year 2010.
I also want to stand in strong support of this legislation which
locks away 100 percent of the Social Security Trust Fund for Social
Security and locks away 100 percent of the Medicare Trust Fund for
Medicare. That is an important commitment not only for today's seniors
but for future generations.
My colleagues, I also stand in strong support of this legislation
which makes it easier for America's workers and small businesses to set
aside money for their own retirement. Efforts to expand what Americans
can contribute to their IRAs and 401(k)s can make a big difference to
many millions of working Americans.
I also want to note that this legislation includes two very important
provisions: Catch-up provisions that allow individuals to make
additional contributions to 401(k)s or IRAs if they are over 50. That
helps working moms. And the repeal of 415 limits, which helps 10
million working Americans in the building trades.
Mr. RANGEL. Mr. Speaker, I yield myself the balance of my time.
As we close the debate on this issue, quite a number of the majority
Members are concerned about the President of the United States getting
involved in spending programs. I would just want the Record to be clear
that the President will not be involved with any spending programs that
are not supported by the majority Members in this House and the
majority of the Members on the other side.
So if my colleagues do not want to support any of these programs,
then get together with the appropriation committees to see what we are
going to do, but let us not use the legislative process to send
messages to the other side or send messages to the President.
Now, this is a good piece of legislation, but some of us, even though
we supported the commitment to the reduction of the national debt,
thought that we should have included the President's retirement plan
that gave incentives for low-income workers to save. And the last time
this bill was on the floor, Members had a chance to participate because
it was not on the suspension calendar. The gentleman from Massachusetts
(Mr. Neal) had an amendment that would have improved upon this bill and
got over 200 votes, as I recall. Many of the Members who worked on this
piece of legislation that once again is before us wish that this could
have been a part of the package so that all of us, in a unanimous way,
could say that it helps all of the workers in different income
categories.
So even though I will not be supporting this in its present form,
since we do not have a chance to amend it or to work with the motion to
recommit, I do want to congratulate the gentleman from Ohio (Mr.
Portman) and the gentleman from Maryland (Mr. Cardin) for showing that
in this House we can work together in a bipartisan way.
The SPEAKER pro tempore (Mr. Scarborough). The time of the gentleman
from New York (Mr. Rangel) has expired. The gentleman from Florida (Mr.
Shaw) has 1\1/2\ minutes remaining.
Mr. SHAW. Mr. Speaker, I yield 1 minute to the gentleman from
Kentucky (Mr. Fletcher).
Mr. FLETCHER. Mr. Speaker, I thank the gentleman for yielding me this
time. It is a busy time of the year, but this past Sunday I was able to
spend some time with a new grandson, born July 22. His name is Joshua.
And that is really what this is about up here. Joshua does not
understand partisan politics. He does not understand a lot of the games
that may go on here. He certainly does not understand why the minority
on the other side is blocking some legislation that would give him a
bright future and pay down the publicly held debt instead of handing
him a mortgage of $20,000. It would allow him, as he is growing up, to
save more, or his parents to save more to be able to afford a home in
the future. And he certainly does not understand the attitude of some
people that believe it is the government's money instead of the
people's money.
But one day he will appreciate what we are doing here today, because
this is really about Joshua and who Joshua represents: All the children
across this Nation. The future. And not only the debt that they have
that we have given them, or has been given to them due to 40 years of
minority rule when the debt was increased, but also the opportunity to
save and to be all that he can be.
Mr. SHAW. Mr. Speaker, I yield myself the balance of my time.
Because of what we do here today, if it does pass the other body and
the President's desk, little Joshua will owe $240 billion less than he
does today on the national debt.
Mr. NEAL of Massachusetts. Mr. Speaker, this is an interesting bill.
It seems to combine an unnecessary bill on debt relief that passed the
House yesterday by a vote of 381-3, with a faulty bill on retirement
policy that passed the House on July 19 by a vote of 401-25. It is my
understanding that our side of the aisle learned about the contents of
the bill about 11:00 this morning, so there may be changes that we have
not discovered yet.
Since revenue that is not spent goes to deficit reduction
automatically, a statement that 90 percent of the surplus should go to
deficit reduction next year hardly seems momentous. However, it does no
great harm either, so I intend to vote for passage of this bill to
indicate my strong support for deficit reduction. In addition, I am
pleased that Members on the other side of the aisle have adopted the
Democratic position as articulated all year, and have finally made
deficit reduction a priority.
On the retirement bill, let me just say that I continue to believe
that H.R. 1102 is flawed and is in need of many improvements. I agree
with Jane Bryant Quinn when she wrote in the Business Section of the
Washington Post this past weekend that this and other bills are ``for
the upper-middle, investor class. There should be a companion tax
incentive bill that helps the workers, too.''
Just such a companion bill, I believe, was offered by myself on July
19, but that amendment failed by a vote of 200-216, with all
Republicans present and voting opposed, and all Democrats but three
present and voting in
[[Page H7798]]
support. This amendment established a refundable tax credit for
contributions to pension plans by low and moderate income workers, and
tax credits to small businesses to establish and contribute to pension
plans. While not perfect, it at least made an attempt to deal with the
problem of access to retirement income for those who can not save due
to their low income, or can not save as much as they should. But the
House, as I indicated, adopted the narrow approach.
Mr. Speaker, in conclusion, I intend to vote for deficit reduction,
and to continue my effort to enact a comprehensive retirement bill that
helps all Americans save for retirement, not just the ``upper-middle,
investor class.''
Mr. GUTKNECHT. Mr. Speaker, today the House is taking up a bill which
would ensure that 90 percent of next year's budget surplus goes to
paying down debt. With this bill, over $600 billion of publicly held
debt would be paid down by the end of next year. It would be entirely
eliminated by 2013. This means lower interest rates on credit cards and
home mortgages for millions of Americans. I can't think of a better
gift for our children.
Unfortunately, this debt reduction measure has been attached to H.R.
1102, the Retirement Security Act. In my district, constituents have
voiced concern over certain pension provisions included in this bill.
Some recent pension conversions have been a grave injustice to American
workers, especially mid-career and older employees who have planned for
retirement based on the benefits built into their original pension
plans. While H.R. 1102 provides some much-needed disclosure
requirements, we need to be tougher on those companies who have taken
advantage of pension conversions to fatten their bottom lines. I will
continue to fight for those tougher provisions.
When H.R. 1102 was being considered, I fought to ensure that all
vested employees have the choice to remain in their current defined
benefit plans. I brought an amendment to the Rules Committee which
would have done just that. Unfortunately, I wasn't allowed to bring it
to the House floor for consideration. In the end, I cast a protest vote
against H.R. 1102 because it lacked this important provision.
Today, there is no opportunity to amend this bill. I wish that these
pension reform provisions had not been attached to debt relief, but it
has. The importance of this bill in locking in debt reduction and
increasing the ability of Americans to save for their own retirement
will carry the day for most Members of this House. I will support this
bill because it is critical that we offer our children a debt-free
future.
Mr. SHAW. Mr. Speaker, I have no further requests for time, and I
yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Florida (Mr. Shaw) that the House suspend the rules and
pass the bill, H.R. 5203.
The question was taken.
Mr. SHAW. Mr. Speaker, I object to the vote on the ground that a
quorum is not present and make the point of order that a quorum is not
present.
The SPEAKER pro tempore. Evidently a quorum is not present.
The Sergeant at Arms will notify absent Members.
This is a 15-minute vote on H.R. 5203 and it will be followed by a 5-
minute vote on H.R. 3986.
The vote was taken by electronic device, and there were--yeas 401,
nays 20, not voting 13, as follows:
[Roll No. 479]
YEAS--401
Abercrombie
Ackerman
Aderholt
Allen
Andrews
Archer
Armey
Baca
Bachus
Baird
Baker
Baldacci
Baldwin
Ballenger
Barcia
Barr
Barrett (NE)
Barrett (WI)
Bartlett
Barton
Bass
Becerra
Bentsen
Bereuter
Berkley
Berman
Berry
Biggert
Bilbray
Bilirakis
Bishop
Blagojevich
Bliley
Blumenauer
Blunt
Boehlert
Boehner
Bonilla
Bonior
Bono
Borski
Boswell
Boucher
Boyd
Brady (PA)
Brady (TX)
Brown (FL)
Brown (OH)
Bryant
Burr
Burton
Buyer
Callahan
Calvert
Camp
Canady
Cannon
Capps
Capuano
Cardin
Carson
Castle
Chabot
Chambliss
Chenoweth-Hage
Clayton
Clement
Clyburn
Coble
Coburn
Collins
Combest
Condit
Cook
Cooksey
Costello
Cox
Coyne
Cramer
Crane
Crowley
Cubin
Cummings
Cunningham
Danner
Davis (FL)
Davis (VA)
Deal
DeFazio
DeGette
Delahunt
DeLauro
DeLay
DeMint
Deutsch
Diaz-Balart
Dickey
Dicks
Dingell
Dixon
Doggett
Doolittle
Doyle
Dreier
Duncan
Dunn
Edwards
Ehlers
Ehrlich
Emerson
Engel
English
Eshoo
Etheridge
Evans
Everett
Ewing
Farr
Fattah
Fletcher
Foley
Forbes
Ford
Fossella
Fowler
Frelinghuysen
Frost
Gallegly
Ganske
Gejdenson
Gekas
Gephardt
Gibbons
Gilchrest
Gillmor
Gilman
Gonzalez
Goode
Goodlatte
Goodling
Gordon
Goss
Graham
Granger
Green (TX)
Green (WI)
Greenwood
Gutierrez
Gutknecht
Hall (OH)
Hall (TX)
Hansen
Hastert
Hastings (FL)
Hastings (WA)
Hayes
Hayworth
Hefley
Herger
Hill (IN)
Hill (MT)
Hilleary
Hilliard
Hinchey
Hinojosa
Hobson
Hoeffel
Hoekstra
Holden
Holt
Hooley
Horn
Hostettler
Houghton
Hoyer
Hulshof
Hunter
Hutchinson
Hyde
Inslee
Isakson
Istook
Jackson-Lee (TX)
Jefferson
Jenkins
John
Johnson, E. B.
Johnson, Sam
Jones (NC)
Jones (OH)
Kanjorski
Kaptur
Kasich
Kelly
Kildee
Kilpatrick
Kind (WI)
King (NY)
Kingston
Kleczka
Knollenberg
Kolbe
Kucinich
Kuykendall
LaHood
Lampson
Lantos
Largent
Larson
Latham
LaTourette
Leach
Levin
Lewis (CA)
Lewis (GA)
Lewis (KY)
Linder
Lipinski
LoBiondo
Lofgren
Lowey
Lucas (KY)
Lucas (OK)
Luther
Maloney (CT)
Maloney (NY)
Manzullo
Markey
Martinez
Mascara
McCarthy (MO)
McCarthy (NY)
McCrery
McGovern
McHugh
McInnis
McIntyre
McKeon
McKinney
Meehan
Meek (FL)
Meeks (NY)
Menendez
Metcalf
Mica
Millender-McDonald
Miller (FL)
Miller, Gary
Miller, George
Minge
Mink
Moakley
Moore
Moran (KS)
Moran (VA)
Morella
Murtha
Myrick
Napolitano
Neal
Ney
Northup
Norwood
Nussle
Oberstar
Obey
Ortiz
Ose
Owens
Oxley
Packard
Pallone
Pascrell
Pastor
Paul
Pease
Pelosi
Peterson (MN)
Peterson (PA)
Petri
Phelps
Pickering
Pickett
Pitts
Pombo
Pomeroy
Porter
Portman
Price (NC)
Pryce (OH)
Quinn
Radanovich
Rahall
Ramstad
Regula
Reyes
Reynolds
Riley
Rivers
Rodriguez
Roemer
Rogan
Rogers
Rohrabacher
Ros-Lehtinen
Rothman
Roukema
Royce
Rush
Ryan (WI)
Ryun (KS)
Salmon
Sanchez
Sandlin
Sanford
Sawyer
Saxton
Scarborough
Schaffer
Schakowsky
Scott
Sensenbrenner
Serrano
Sessions
Shadegg
Shaw
Shays
Sherman
Sherwood
Shimkus
Shows
Shuster
Simpson
Sisisky
Skeen
Skelton
Slaughter
Smith (MI)
Smith (NJ)
Smith (TX)
Smith (WA)
Snyder
Souder
Spence
Spratt
Stabenow
Stearns
Stenholm
Strickland
Stump
Stupak
Sununu
Sweeney
Talent
Tancredo
Tanner
Tauscher
Tauzin
Taylor (MS)
Taylor (NC)
Terry
Thomas
Thompson (CA)
Thompson (MS)
Thornberry
Thune
Thurman
Tiahrt
Tierney
Toomey
Towns
Traficant
Turner
Udall (CO)
Udall (NM)
Upton
Velazquez
Visclosky
Vitter
Walden
Walsh
Wamp
Waters
Watt (NC)
Watts (OK)
Waxman
Weiner
Weldon (FL)
Weldon (PA)
Weller
Wexler
Weygand
Whitfield
Wicker
Wilson
Wolf
Woolsey
Wu
Wynn
Young (AK)
Young (FL)
NAYS--20
Clay
Conyers
Davis (IL)
Filner
Frank (MA)
Jackson (IL)
Kennedy
LaFalce
Lee
Matsui
McDermott
Mollohan
Nadler
Olver
Payne
Rangel
Roybal-Allard
Sabo
Sanders
Stark
NOT VOTING--13
Campbell
Dooley
Franks (NJ)
Johnson (CT)
Klink
Lazio
McCollum
McIntosh
McNulty
Nethercutt
Vento
Watkins
Wise
{time} 1517
Messrs. JACKSON of Illinois, FILNER, and NADLER changed their vote
from ``yea'' to ``nay.''
So (two-thirds having voted in favor thereof) the rules were
suspended and the bill was passed.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
Stated for:
Mrs. JOHNSON of Connecticut. Mr. Speaker, on rollcall No. 479 I was
inadvertently detained. Had I been present, I would have voted ``yes.''
____________________