[Congressional Record Volume 166, Number 214 (Thursday, December 17, 2020)]
[Senate]
[Pages S7592-S7634]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTION

      By Mrs. FEINSTEIN (for herself and Ms. Cortez Masto):
  S. 5041. A bill to establish the Advisory Committee on Climate Risk 
on the Financial Stability Oversight Council; to the Committee on 
Banking, Housing, and Urban Affairs.
  Ms. FEINSTEIN. Mr. President, I rise to speak in support of the 
``Addressing Climate Financial Risk Act,'' which I introduced today.


                               Background

  The average global temperature has increased by over 3 degrees 
Fahrenheit in parts of my home State of California over the last 
century, and 2020 is on track to be the hottest year on record. Climate 
change is driving the increasing frequency and severity of wildfires, 
floods, droughts, and other natural disasters and extreme weather 
events.
  In California, wildfires in particular have become a major annual 
concern. This year alone, wildfires have burned 4.1 million acres of 
California forests and destroyed more than 10,000 structures, including 
more than 5,000 homes.
  The damage and risk generated by these events--in addition to the 
changes needed to transition to a lower-carbon economy--threaten to 
severely disrupt real estate values in high-risk areas, make insuring 
against risk increasingly unaffordable, and dramatically change whole 
sectors of the economy.


                          Need for Legislation

  Unfortunately, U.S. Federal financial regulators have not done enough 
to ensure that they fully understand and are appropriately acting on 
the risk that climate change poses to the stability of the U.S. 
financial system.
  Therefore, I believe there are a series of simple steps we should 
take to ensure that U.S. financial regulators are well-equipped to 
mitigate climate financial risk.
  This bill would make five main improvements to the U.S. financial 
regulatory system.
  First, it would establish a permanent committee on the Financial 
Stability Oversight Council (FSOC)--which Congress has charged with 
identifying risks to the U.S. financial system--made up of experts in 
climate science, climate economics, and climate financial risk.
  This committee would assist FSOC in publishing a report that assesses 
the ability of the U.S. financial regulatory system to mitigate climate 
financial risk and makes recommendations for improving its ability to 
do so.
  Second, the bill would require each Federal bank and credit union 
regulatory agency to update its supervisory guidance to include climate 
financial risk, and to develop a strategy to identify and mitigate 
climate financial risk.
  Third, the bill would require FSOC to specify how it will take 
climate financial risk into account when making decisions on whether to 
subject nonbank financial firms to additional oversight by the Federal 
Reserve Board.
  Fourth, the bill would mandate a report from the Federal Insurance 
Office on how to modernize and improve the regulation of climate 
financial risk insurance regulation in the United States.
  Finally, the bill would express the sense of Congress that climate 
change is a global problem, and that U.S. financial regulators should 
join international organizations focused on addressing climate 
financial risk and work with financial regulators in other countries to 
the extent possible and consistent with U.S. law.


                               Conclusion

  Climate change is real. It's happening now and it will have a 
profound effect on our financial system if we continue to do nothing. 
We must act to ensure that federal financial regulators have expertise 
in climate financial risk and develop approaches to mitigate that risk.
  I hope my colleagues will join me in support of this bill. Thank you, 
Mr. President, and I yield the floor.
                                 ______
                                 
      By Mr. GRASSLEY (for himself and Mr. Alexander):
  S. 5045. A bill to amend the Internal Revenue Code of 1986 and the 
Employee Retirement Income Security Act of 1974 to reform the treatment 
of multiemployer plans, to ensure the ability of the Pension Benefit 
Guaranty Corporation to provide guaranteed benefits of retirees, and 
for other purposes; to the Committee on Finance.
  Mr. GRASSLEY. Mr. President, in late June, I came to the floor to 
speak about the need to fix the multiemployer pension system and how 
that system is failing its employees and retirees. I spoke about the 
need to secure retirement benefits for the millions of Americans who 
will start to see plans fail and benefits cut in the coming years if 
Congress doesn't fix this problem.
  For the past 2 weeks, Chairman Alexander and I were negotiating with 
our Democratic colleagues to do just that--fix the system so future 
retirees and retirees now would not lose out on what they were 
promised. Those negotiations were very constructive, and I believe that 
both sides worked in good faith. While both sides agreed to make 
significant changes, in the end, we weren't able to find a compromise 
that satisfied our respective principles and objectives for resolving 
this situation.
  Here is the hang up--time. Now at the end of the session, with the 
end-of-the-year agenda and adjournment of the Congress, we just ran out 
of time. So in the midst of yearend appropriations and COVID relief 
negotiations, there simply wasn't enough time to reconcile our 
differences on how to fix this failing system.
  My hope had been to use the last 8 months to negotiate a solution in 
a thoughtful and measured manner, instead of like now, in the heat of a 
complex yearend bill. But sadly, those 8 months didn't produce results.
  From the beginning, we have agreed that Federal funds will be needed 
to solve the crisis in the short term--yes, money from the Treasury for 
pension plans that are in trouble now. But we have been equally 
resolute that reforms are essential to ensure the system can be self-
sustaining in the long term. So we were trying to find a short-term 
solution that would involve the injection of Federal dollars, but we 
wanted a long-term solution that would make sure that private pension 
plans were self-sustaining and not relying upon the Federal Treasury. 
Otherwise, taxpayers will be perpetually subsidizing a private sector 
system of employee benefit promises.
  Last November, Chairman Alexander and I presented our comprehensive 
approach to rescue and reform the multiemployer pension system, which 
we have been working on and improving ever since. The product was 
improved with an amazing amount of input from workers, retirees, 
unions, employers, actuaries, academics, plan officials, and even 
members of the general public. Something as big as this needed to 
involve all of those people being at the table.
  Today, Chairman Alexander and I will introduce a revised version of 
that plan, the Chris Allen Multiemployer Pension Recapitalization and 
Reform Act. This legislation served as the basis for our recent 
negotiations and is the product of years of work with Chairman 
Alexander to produce a serious, responsible plan that can provide 
relief to failing plans and to protect retirees' benefits.
  It is also designed to ensure the long-term solvency of the Pension 
Benefit Guaranty Corporation's multiemployer insurance fund, based on 
the many comments and proposals we received to the original Grassley-
Alexander plan released last November.
  We believe this legislation would ensure that the PBGC's 
multiemployer insurance fund remains solvent over the long term after 
the initial rescue of the currently failing plans. But, most 
importantly, this legislation would reform the system to prevent this 
from happening again.
  I would also like to note that the bill is named after Chris Allen, 
who was a

[[Page S7593]]

dedicated member of my Finance Committee staff, who passed away nearly 
1 year ago at too young of an age. Chris poured thousands of hours of 
work into developing, drafting, and perfecting the Grassley-Alexander 
plan. I am grateful for all the work that Chris did, and I am proud 
this legislation bears his name.
  I am also grateful to Andy Banducci, who helped us continue Chris's 
work while on detail to the committee from the PBGC for several months 
earlier this year. His expertise and commitment, especially during the 
pandemic, were essential to bringing this legislation to completion.
  Lastly, Mark Warren of the Finance Committee staff has led my team on 
this very important issue with the help of Jamie Cummins.
  This bill would not be possible without their efforts. So I thank 
Mark, Jamie, Andy, and Chris for their dedicated service.
  Let me close by stressing two points for my Democratic colleagues. I 
appreciate the Democrats' professional and good-faith effort to try to 
find an agreement to this important issue. Although we were not able to 
reconcile our differences before the clock ran out, we need to carry 
that work forward, and I remain ready to continue that discussion. I 
want to make clear that, while the last 2 years I have been chairman of 
the Finance Committee, I won't be chairman the next 2 years, and we 
will be working under the leadership of the next chairman, Senator 
Crapo, if Republicans continue to be in the majority.
  These issues are not simple, and as I said in June, delaying the 
solution is only going to make the whole effort more costly. We should 
continue to work together to find a solution for the 10 million workers 
and retirees in these multiemployer plans. America's retirees deserve 
it.
  Mr. President. I ask that the text of the bill be printed in the 
Record.ZPERSONAL COMPUTER\J\019060-A17DE6-023-*****-*****-Payroll No.: 
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                                S. 5045

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Chris 
     Allen Multiemployer Pension Recapitalization and Reform Act 
     of 2020''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

  TITLE I--RESTRUCTURING PENSION INSURANCE FOR MULTIEMPLOYER DEFINED 
                         BENEFIT PENSION PLANS

     Subtitle A--Special Partitions of Eligible Multiemployer Plans

Sec. 101. Special partitions of eligible multiemployer plans.

                        Subtitle B--PBGC Reforms

Sec. 111. Guarantee rate increase for plans receiving financial 
              assistance.
Sec. 112. Amendment to definition of insolvency.
Sec. 113. Termination of multiemployer plans.
Sec. 114. Benefits under certain terminated plans.

                 Subtitle C--Pension Insurance Modeling

Sec. 121. Pension insurance modeling.

    TITLE II--FUNDING RULES, WITHDRAWAL LIABILITY, AND OTHER REFORMS

      Subtitle A--Minimum Funding Standard for Multiemployer Plans

Sec. 201. Valuation of plan liabilities.

      Subtitle B--Additional Funding Rules for Multiemployer Plans

                     PART I--Plan Status Amendments

Sec. 211. Amendments to Internal Revenue Code of 1986.
Sec. 212. Amendments to Employee Retirement Income Security Act of 
              1974.
Sec. 213. Transition rules.

              PART II--Provisions Relating to Plan Mergers

Sec. 221. Provisions relating to plan mergers and consolidations.
Sec. 222. Clarification of PBGC financial assistance for plan mergers 
              and partitions.
Sec. 223. Restoration not required for certain mergers.

                 PART III--Withdrawal Liability Reform

Sec. 231. Withdrawal liability reform.

     TITLE III--PLAN GOVERNANCE, DISCLOSURE, AND OTHER REFORMS FOR 
              MULTIEMPLOYER DEFINED BENEFIT PENSION PLANS

   Subtitle A--Plan Governance and Operations for Multiemployer Plans

Sec. 301. Independent trustees.
Sec. 302. Investigatory authority.
Sec. 303. Conditions on financial assistance.
Sec. 304. Excise tax on excess compensation of covered employees of 
              partitioned multiemployer plans.

         Subtitle B--Reportable Events for Multiemployer Plans

Sec. 311. Reportable events.

   Subtitle C--Funding Notices to Participants in Multiemployer Plans

Sec. 321. Improved multiemployer plan disclosure.
Sec. 322. Penalties for failure to provide notices.

             Subtitle D--Consistency of Criminal Penalties

Sec. 331. Consistency of criminal penalties.

               TITLE IV--OTHER MULTIEMPLOYER PLAN REFORMS

Sec. 401. Clarification of fiduciary duty of retiree representative who 
              is a trustee.
Sec. 402. Safe harbors.
Sec. 403. Clarification of notice and comment process.
Sec. 404. Protection of participants receiving disability benefits.
Sec. 405. Model notice.

                  TITLE V--ALTERNATIVE PLAN STRUCTURES

Sec. 501. Composite plans.
Sec. 502. Application of certain requirements to composite plans.
Sec. 503. Treatment of composite plans under title IV.
Sec. 504. Conforming changes.
Sec. 505. Effective date.

                     TITLE VI--FINANCIAL PROVISIONS

Sec. 601. Additional premiums.
Sec. 602. Funding.
Sec. 603. Composite plan transition fee.

  TITLE I--RESTRUCTURING PENSION INSURANCE FOR MULTIEMPLOYER DEFINED 
                         BENEFIT PENSION PLANS

     Subtitle A--Special Partitions of Eligible Multiemployer Plans

     SEC. 101. SPECIAL PARTITIONS OF ELIGIBLE MULTIEMPLOYER PLANS.

       (a) In General.--Title IV of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1301 et seq.) is amended by 
     inserting after section 4233 the following:

     ``SEC. 4233A. SPECIAL PARTITIONS OF ELIGIBLE MULTIEMPLOYER 
                   PLANS.

       ``(a) In General.--
       ``(1) Requirement to order partition.--Upon the application 
     by the plan sponsor of an eligible multiemployer plan 
     described in subsection (b) for a partition of the plan, the 
     corporation shall order a partition of the plan in accordance 
     with this section, provided the other requirements in this 
     section are met. The corporation shall make a determination 
     regarding the application not later than 150 days after the 
     date such application was filed (or, if later, the date such 
     application was completed) in accordance with regulations 
     that shall be issued by the corporation under subsection (h).
       ``(2) Notification of participants.--Not later than 30 days 
     after submitting an application for partition of a plan under 
     paragraph (1), the plan sponsor of the plan shall notify the 
     participants and beneficiaries of such application, in the 
     form and manner prescribed by the corporation.
       ``(3) Implementation of transfer.--The corporation shall 
     implement the partition order issued under this section not 
     later than 60 days after the completion of the corporation's 
     determination under paragraph (1).
       ``(4) Filing date of application.--Partitions under this 
     section shall apply only with respect to any eligible 
     multiemployer plan whose plan sponsor files an application 
     that is determined by the corporation to be complete pursuant 
     to regulations issued by the corporation under subsection 
     (h)(1) and that is filed by the later of the time specified 
     in such regulations or 1 year after the corporation issues 
     such regulations.
       ``(b) Eligible Multiemployer Plan.--For purposes of this 
     section--
       ``(1) In general.--The term `eligible multiemployer plan' 
     means a multiemployer plan that meets any of the following 
     conditions:
       ``(A) The plan became insolvent ( as described in section 
     4245(b), as in effect the day before the date of enactment of 
     this section) on or after December 16, 2014, and prior to the 
     date of enactment of this section and has not terminated.
       ``(B) The plan--
       ``(i)(I) was certified, in the most recent annual 
     certification filed pursuant to section 305(b)(3) (as in 
     effect on the day before the date of enactment of this 
     section) before the date of enactment of this section, to be 
     in critical and declining status (as defined in section 
     305(b)(6), as so in effect), and has not terminated as of 
     such date;
       ``(II) implemented a suspension of benefits under section 
     305(e)(9) (as in effect on the day before the date of 
     enactment of this section) prior to the date of enactment of 
     this section;
       ``(III)(aa) was certified, in the most recent annual 
     certification filed pursuant to section 305(b)(3) (as so in 
     effect) before the date of enactment of this section, to be 
     in critical status (as defined in section 305(b)(2), as so in 
     effect), and has not terminated as of such date;
       ``(bb) has a funded percentage that is less than 40 percent 
     on a current liability basis, based on the most recent Form 
     5500, Schedule MB, line 1b(1) for current value of assets and 
     line 1d(2)(a) for current liability, filed before the date of 
     enactment of this section; and
       ``(cc) has an active to inactive participant ratio that is 
     below 40 percent as of the most recent Form 5500 filed before 
     the date of enactment of this section; or
       ``(IV)(aa) was certified, in the most recent annual 
     certification filed pursuant to section 305(b)(3) (as so in 
     effect) before the date of

[[Page S7594]]

     enactment of this section, to be in critical status (as 
     defined in section 305(b)(2), as so in effect) and has not 
     terminated before such date,
       ``(bb) has an active to total participant ratio that is 
     below 20 percent as of the most recent Form 5500 filed before 
     the date of enactment of the section; and
       ``(cc) has more than 100,000 participants as of the most 
     recent Form 5500 filed before the date of enactment of the 
     section; and
       ``(ii) is not the plan described in section 9701(a)(3) of 
     the Internal Revenue Code of 1986, determined without regard 
     to the limitation on participation to individuals who retired 
     in 1976 and thereafter.
       ``(2) Eligible plans required to file for partition.--
       ``(A) In general.--An eligible multiemployer plan (other 
     than a plan eligible under paragraph (1)(B)(i)(II)) shall 
     file with the corporation for partition under this section. 
     If an eligible plan required under the preceding sentence to 
     file for partition does not so file in a timely manner, the 
     plan is subject to termination under section 4042.
       ``(B) Exception.--If a plan is reasonably determined to be 
     ineligible for future adjustments under subsection 
     (j)(3)(C)(iii)--
       ``(i) subparagraph (A) shall not apply to such plan, and
       ``(ii) such plan may withdraw the partition application 
     (or, as provided by the corporation in regulations, not 
     submit such application at all).
       ``(c) Conditions for Partition.--
       ``(1) Rate of accruals.--
       ``(A) In general.--As a condition of any partition under 
     this section, the rate of future accruals, during the period 
     beginning on the date of the partition order and ending 15 
     years after the effective date of the partition, shall not 
     exceed the lesser of--
       ``(i) a monthly benefit (payable as a single life annuity 
     commencing at the participant's normal retirement age) equal 
     or equivalent to 1 percent of the annual contributions 
     required to be made with respect to a participant as of the 
     first day of the first plan year that begins after the date 
     of enactment of this section; or
       ``(ii) the accrual rate under the plan on such first day.
       ``(B) Determination of equivalent rate.--The plan sponsor 
     may determine the equivalent rate of future accruals based on 
     the standard or average contribution base units which the 
     plan sponsor determines to be representative for active 
     participants and such other factors as the plan sponsor 
     determines to be relevant. Such determinations by the plan 
     sponsor may be made on the basis of individual active 
     participants, groups of active participants, or all active 
     participants in total.
       ``(C) Special rule for future accruals.--To the extent that 
     the rate of future accruals exceeds the limitation determined 
     under this paragraph, the plan sponsor shall adjust the rate 
     of future accruals in accordance with this paragraph 
     effective as of the date of the partition order.
       ``(2) Elimination of adjustable benefits.--As a condition 
     of any partition under this section, the plan sponsor of an 
     eligible multiemployer plan shall eliminate all adjustable 
     benefits in the nature of an early retirement subsidy 
     (including a subsidized early retirement actuarial reduction 
     factor) for all participants not in pay status as of the date 
     of the partition application. Nothing in this paragraph shall 
     affect the right of a participant to receive an unsubsidized 
     early retirement benefit.
       ``(d) Successor Plans and Original Plans.--
       ``(1) In general.--The plan created by the partition order 
     is a successor plan to which section 4022A applies.
       ``(2) Plan sponsor and plan administrator.--The plan 
     sponsor of an eligible multiemployer plan prior to partition 
     and the administrator of such plan shall be the plan sponsor 
     and the administrator, respectively, of the original plan and 
     the successor plan created by the partition order.
       ``(3) Original plan.--The remaining plan after benefits 
     have been transferred to the successor plan pursuant to the 
     partition order is the original plan. Benefit payments made 
     by the successor plan shall not constitute a reduction in 
     benefits with respect to the original plan.
       ``(e) Financial Assistance to Successor Plans From the 
     Corporation.--
       ``(1) In general.--Upon approval of an application filed 
     pursuant to subsection (i), the corporation shall provide 
     financial assistance to each successor plan of an eligible 
     multiemployer plan.
       ``(2) Nonapplicability of repayment rule.--Financial 
     assistance provided to a successor plan pursuant to this 
     subsection shall not be subject to the requirements of 
     section 4261(b)(2), except that the corporation may condition 
     receipt of financial assistance under this subsection on 
     reasonable terms consistent with regulations prescribed by 
     the corporation to prevent abuse of the multiemployer plan 
     program or prevent unreasonable risk of loss to the 
     corporation.
       ``(f) Payment Requirements of Original Plan.--For each 
     participant or beneficiary of the plan whose benefit or 
     portion thereof was transferred to the successor plan, the 
     original plan shall pay a monthly benefit to such participant 
     or beneficiary for each month in which such benefit is in pay 
     status following the effective date of such partition in an 
     amount equal to the excess of--
       ``(1) the monthly benefit that would be paid to the 
     participant or beneficiary under the terms of the original 
     plan had the transfer of benefits not occurred (taking into 
     account any applicable benefit reductions or plan amendments 
     following the effective date of the partition); over
       ``(2) the monthly benefit for such participant or 
     beneficiary that is paid by the successor plan.
       ``(g) Transfer of Benefits.--
       ``(1) In general.--A partition order under subsection (a) 
     shall provide for a transfer of benefits from the original 
     plan to the successor plan in the amount necessary for the 
     original plan to be projected to remain solvent indefinitely, 
     as defined in section 1.432(e)(9)-1(d)(5)(ii) of title 26, 
     Code of Federal Regulations (excluding subparagraph (A)(2)), 
     as in effect on the date on which such regulations were 
     issued, using actuarial and other assumptions to be 
     promulgated by the corporation in the regulations described 
     in subsection (h)(4). Such transfer amounts shall be 
     determined without respect to the amount guaranteed under 
     section 4022A.
       ``(2) Considerations.--
       ``(A) In general.--In determining the transfer amount under 
     paragraph (1), the corporation shall take into account all 
     obligations of the original plan, including the payment of 
     benefits required under subsection (f) in excess of the 
     amount paid by the successor plan and all plan expenses and 
     premium amounts.
       ``(B) Projection of assets and liabilities.--The amount of 
     the transfer of benefits shall be based on a projection of 
     plan assets and liabilities to the projected partition date, 
     as specified in the partition application, and--
       ``(i) the projection of plan assets shall be based on the 
     fair market value of plan assets as of the end of the last 
     plan year preceding the date of the application, with 
     appropriate adjustments for actual or anticipated plan 
     experience through the projected partition date; and
       ``(ii) the projection of plan liabilities shall be based on 
     the participant data used in the most recently completed 
     actuarial valuation.
       ``(3) Special rule for insolvent plans.--With respect to an 
     insolvent plan described in subsection (b)(1)(A), the 
     corporation shall provide financial assistance to the 
     original plan, as needed for the plan to pay to each 
     participant and beneficiary in the successor plan the excess, 
     if any, of--
       ``(A) the monthly benefit that would be paid to the 
     participant or beneficiary under the terms of the original 
     plan, prior to insolvency, had the transfer of benefits not 
     occurred (taking into account any applicable benefit 
     reductions or plan amendments following the effective date of 
     the partition); over
       ``(B) the monthly benefit for such participant or 
     beneficiary that is paid by the successor plan.
       ``(h) Regulations.--
       ``(1) In general.--The corporation shall issue regulations 
     on the requirements for partition applications not later than 
     180 days after the date of enactment of this section. By 
     regulation, the corporation may assign eligible multiemployer 
     plans into groups, based on plan size (prioritizing larger 
     plans), projected date of plan insolvency (prioritizing plans 
     expected to become insolvent within 5 years), or such other 
     factors as the corporation deems appropriate, for determining 
     when an application for partition under this section may be 
     filed. Any regulations issued under this section shall be 
     interim final or final regulations.
       ``(2) Effect of no regulation.--If the corporation does not 
     issue regulations within 180 days after the date of enactment 
     of this section, any applications for partition under this 
     section filed after the date that is 180 days after such date 
     of enactment (and prior to the date regulations are issued) 
     shall be deemed to be approved.
       ``(3) Rules for determining participants and 
     beneficiaries.--The regulations under this subsection shall 
     include rules for determining which participants and 
     beneficiaries are included in the transfer of benefits.
       ``(4) Actuarial assumptions.--The regulations under this 
     subsection shall prescribe acceptable actuarial assumptions, 
     for purposes of an application, relating to the following:
       ``(A) Future investment returns which must be consistent 
     with the applicable discount rate under section 304, except 
     that--
       ``(i) in no case shall the assumption for future returns be 
     less than 5.5 percent for purposes of determining the initial 
     partition amount; and
       ``(ii) in no case, while the partition amount is being 
     determined or while the partition is in effect, shall the 
     assumption used for determining adjustments under subsection 
     (j) be less than the lesser of--

       ``(I) the rate equal to the 24-month average of the third 
     segment rate (as defined in section 303(h)(2)(C)(iii)), as of 
     the date the determination is made, without regard to section 
     303(h)(2)(C)(iv), increased by 2 percent; or
       ``(II) 5.5 percent.

       ``(B) Future contribution base units.
       ``(C) Future contribution rate increases, taking into 
     account the adopted rehabilitation plan.
       ``(D) Future withdrawal liability payments.
       ``(E) Future administrative expenses.
       ``(F) Mortality.
       ``(G) Any other assumptions deemed by the corporation to be 
     material.

[[Page S7595]]

       ``(5) Rules relating to assumptions.--
       ``(A) Information required.--For purposes of paragraph (4), 
     when prescribing acceptable actuarial assumptions, the 
     corporation shall not require a plan sponsor to obtain data 
     or other information that a plan sponsor should not 
     reasonably be expected to have in its possession, unless it 
     can be obtained with reasonable effort and expense.
       ``(B) Economic activity assumption.--For purposes of 
     paragraph (4)(B), an assumption related to future 
     contribution base units shall be considered reasonable and 
     appropriate for purposes of the application under this 
     section, provided that--
       ``(i) if the recent experience of the plan has been 
     declining contribution base units, the plan actuary may 
     assume future contribution base units will continue to 
     decline at the same annualized trend as over the 5 
     immediately preceding plan years unless such assumption is 
     unreasonable based on criteria which may be prescribed by the 
     corporation by regulation, and
       ``(ii) if the recent experience of the plan has been 
     increasing, or neither increasing nor decreasing, 
     contribution base units, the plan actuary may assume future 
     contribution base units will remain unchanged indefinitely, 
     unless such assumption is unreasonable based on criteria the 
     corporation may prescribe.
       ``(6) Determination of benefits guarantees.--The 
     regulations under this subsection shall include rules for 
     determining the amounts of benefits guaranteed under section 
     4022A, including acceptable methods to approximate credited 
     service for participants and beneficiaries in pay status 
     where records cannot reasonably be obtained by the plan 
     administrator.
       ``(i) Partition Applications.--
       ``(1) In general.--An application for partition under this 
     section submitted by a plan sponsor shall be filed 
     electronically and contain the required information set forth 
     in regulations promulgated by the corporation.
       ``(2) Approval standards.--The corporation shall approve a 
     partition application if the applying plan meets the 
     requirements for a partition under this section.
       ``(3) Evaluation of initial transfer.--In reviewing an 
     application under this section, the plan shall propose the 
     initial amount of the transfer of benefits under the 
     partition order that is required under subsection (g)(1) and 
     the corporation shall review and modify the amount, if 
     applicable, pursuant to its regulations.
       ``(4) Determinations by the corporation.--
       ``(A) Determination of ineligibility.--If the corporation 
     determines the plan to be ineligible under subsection (b) for 
     a partition under this section, the corporation shall notify 
     the plan sponsor in writing of such determination not later 
     than 30 days after the application is filed. Such notice 
     shall specify the reasons the plan is ineligible for a 
     special partition. The applicant plan will have a period of 
     at least 60 days, or longer if specified by the Corporation 
     through regulations, to modify its application, which shall 
     be subject to expedited review by the corporation and, for 
     purposes of satisfying the 1-year filing requirement for 
     special partition, will relate back to the date the 
     application was initially filed.
       ``(B) Incomplete applications.--If the corporation 
     determines the application by the plan sponsor lacks 
     information necessary for the corporation to approve or deny 
     the application, the corporation shall notify the plan 
     sponsor in writing, detailing which components are missing, 
     not later than 30 days after the application is filed. 
     Nothing in the preceding sentence shall prevent the 
     corporation from asking the plan sponsor at a later date for 
     additional information necessary to determine the partition 
     amount.
       ``(C) Factual submissions by plan sponsor.--The factual 
     submissions made by a plan sponsor in a partition 
     application, including participant data and benefit 
     calculations, shall be presumed to be correct, unless clearly 
     erroneous.
       ``(j) Post-partition Adjustments.--
       ``(1) Process for adjustments.--
       ``(A) In general.--After benefits have been transferred 
     under the partition order, the corporation shall, at least 
     every third year thereafter, adjust the transfer of benefits, 
     as necessary to enable the original plan to be projected to 
     remain solvent indefinitely, consistent with limitations on 
     guaranteed benefits (if applicable under paragraph (3)(C)). 
     The adjustments shall be made based on such procedures as the 
     corporation shall prescribe by regulation.
       ``(B) Plans projected to be insolvent.--If the original 
     plan is not projected to be solvent 30 years after any 
     adjustment review date (without regard to whether or not an 
     adjustment takes place in connection with such date), taking 
     into account the adjustments permitted by this paragraph, 
     such plan shall electronically file a report with the 
     corporation, as the corporation shall require by regulation. 
     If the plan subsequently reports for 3 consecutive years for 
     which an adjustment review is conducted that the plan is not 
     projected to be solvent 30 years after the date of each such 
     adjustment review, the plan shall be terminated.
       ``(2) Basis for adjustment.--The adjustment shall be based 
     solely on, as applicable, updated participant data, 
     calculations of guaranteed benefits for participants and 
     beneficiaries covered under the successor plan, contribution 
     experience, current actuarial assumptions (if changed since 
     the initial transfer of benefits), and changes in the market 
     value of the original plan's assets.
       ``(3) Limitations on adjustment.--
       ``(A) In general.--The corporation shall not adjust under 
     paragraph (1) the transfer of benefits to provide additional 
     financial assistance if the corporation determines that the 
     original plan or the bargaining parties committed an abuse of 
     the multiemployer program with respect to the original plan 
     or otherwise unreasonably took actions (or avoided taking 
     actions) with the result that there is an increased risk of 
     loss to the corporation with respect to the successor plan or 
     the original plan.
       ``(B) End of adjustment authority.-- No adjustments under 
     paragraph (1) to the transfer of benefits shall be allowed 
     with respect to any plan year beginning 30 or more years 
     after the date of the partition.
       ``(C) Aggregate limits.--If the initial transfer of 
     benefits from the plan under subsection (g)--
       ``(i) was less than 100 percent of the amount of benefits 
     under the plan guaranteed under section 4022A for each 
     participant, any adjustment under paragraph (1) shall not 
     result in a benefit for any participant in the successor plan 
     in excess of 100 percent of the participant's guaranteed 
     benefit, determined as of the date of the initial transfer;
       ``(ii) was equal to or greater than 100 percent of the 
     amount of benefits so guaranteed, any adjustment under 
     paragraph (1) shall not result in a benefit for any 
     participant in the successor plan in excess of the amount of 
     the participant's benefit subject to the initial transfer; 
     and
       ``(iii) was less than 5 percent of the amount of benefits 
     so guaranteed, there shall be no adjustment under paragraph 
     (1).
       ``(4) Terminated and insolvent plans.--With respect to an 
     original plan partitioned under this section that 
     subsequently is terminated or becomes insolvent, the benefits 
     transferred under the partition order shall revert to the 
     original plan, the partition shall be reversed, and financial 
     assistance provided pursuant to the partition order shall 
     cease.
       ``(5) Regulations.--The corporation shall promulgate 
     regulations describing the process and requirements for 
     reporting and the circumstances under which plans will be 
     terminated in accordance with the provisions of section 4041A 
     pursuant to this subsection.
       ``(k) Plans That Implemented Suspension of Benefits.--
       ``(1) In general.--An eligible multiemployer plan described 
     in subsection (b)(1)(B)(i)(II) may be approved for a 
     partition under this section only if it unwinds the 
     suspension, and, if applicable, the previous partition 
     described in such subsection in accordance with regulations 
     to be issued by the corporation, in consultation with the 
     Secretary of the Treasury. The unwinding of a suspension or 
     partition described in such subsection must be contingent 
     upon the corporation's approval of the application for 
     partition under this section.
       ``(2) Timing of unwinding of suspension of benefits.--In 
     the case of a partition described in paragraph (1), the 
     suspension of benefits shall be unwound retroactively. 
     Benefits shall be restored to pre-suspension levels as of the 
     effective date of the partition under this section and 
     participants who are receiving benefits on the date of 
     enactment of this section shall, beginning not later than 180 
     days after the approval of a partition order under this 
     section, receive a special payment, payable over a period not 
     to exceed 2 years, equal to the amount of benefits previously 
     suspended as prescribed in regulations. Such plans are 
     subject to the requirements of subsection (c).
       ``(l) Fiduciary Protection.--Plan participants and 
     beneficiaries shall not have a claim under section 409 or 
     section 502 of this Act against plan fiduciaries with respect 
     to an application for partition assistance made in good faith 
     or the allocation of benefit liabilities between the 
     successor plan and the original plan.
       ``(m) Effect of Partition on Withdrawal Liability.--
       ``(1) In general.--A partition order under this section is 
     taken into account in determining withdrawal liability under 
     section 4201 of an employer that contributes to the original 
     plan, provided that the employer remains a contributing 
     employer to the original plan (and in compliance with any 
     applicable funding improvement or rehabilitation plan) for a 
     period of 15 years following the effective date of the 
     liability transfer.
       ``(2) Withdrawals after less than 15 years.--
       ``(A) In general.--If an employer completely withdraws or 
     partially withdraws from a plan that was partitioned under 
     this section at any time within the 15-year period described 
     in paragraph (1), the transfer of benefits under subsection 
     (g) shall not be taken into account in computing the 
     employer's complete or partial withdrawal liability, and the 
     amount of the annual withdrawal liability payment amount 
     otherwise determined shall be increased by 10 percent.
       ``(B) Exception.--Subparagraph (A) shall not apply--
       ``(i) if the complete or partial withdrawal is due to a 
     decertification, a change in bargaining representatives, 
     disclaimer of interest, or because of an event described in 
     section 4218; or
       ``(ii) in the case of a partial withdrawal due to a 
     bargaining unit or facility take-out if the contribution base 
     units for the plan year immediately following the year of the 
     partial withdrawal are at least 97 percent of the

[[Page S7596]]

     contribution base units for the plan year immediately 
     preceding the year of the partial withdrawal.
       ``(3) Exception.-- Paragraphs (1) and (2) shall not apply 
     to an employer that first had an obligation to contribute to 
     the plan partitioned under this section after the date of 
     enactment of this section.
       ``(n) Restrictions on Benefit Improvements.--
       ``(1) Increase in plan liabilities.--
       ``(A) In general.--If the plan sponsor adopts a plan 
     amendment that increases plan liabilities (due to any 
     increase in benefits, any change in the accrual of benefits, 
     or any change in the rate at which benefits become 
     nonforfeitable) that takes effect after the effective date of 
     the partition, the original plan shall make payments to the 
     corporation for each year during the 20-year period following 
     the effective date of the benefit increase. For purposes of 
     this paragraph, an increase in benefits due to an increase in 
     the contribution rate or compensation shall be considered a 
     prohibited increase in benefits.
       ``(B) Exception for certain accruals.--Subparagraph (A) 
     shall not apply to any change in future accruals after the 
     end of the 15-year period during which such accruals are 
     limited under subsection (c).
       ``(2) Amount payable to corporation.--The amount paid by 
     the original plan to the corporation under paragraph (1) each 
     year shall be equal to the lesser of--
       ``(A) the total value of the increase in benefit payments 
     for the year that is attributable to the benefit improvement; 
     or
       ``(B) the total benefit payments from the successor plan 
     for such year.
       ``(3) Timing of payment.--Payments under paragraph (2) 
     shall be made by the original plan at the time of, and in 
     addition to, any premium imposed by the corporation on the 
     plan.
       ``(4) PBGC authority.--The corporation is authorized to 
     bring an action against the original plan to prevent or 
     correct any and all actions by plan sponsors, a principal 
     purpose of which is to evade or avoid payments due to the 
     corporation under paragraph (2), or that may have the effect 
     of evading or avoiding such payments. Payments under 
     paragraph (2) shall be determined without regard to such 
     actions by plan sponsors.
       ``(5) Exception for certain changes.--The requirements of 
     this subsection do not apply to an increase or change in 
     benefits that is required by law or that is a de minimis 
     change, as determined by the corporation.
       ``(o) Post-partition Disclosures.--Not later than 90 days 
     after the first day of each plan year beginning after the 
     effective date of a partition under this section, the plan 
     sponsor of the original plan shall electronically file with 
     the corporation a report including the following information:
       ``(1) The estimated funded percentage (as defined in 
     section 305(k)(2)) as of the first day of such plan year, and 
     the underlying actuarial value of assets and liabilities 
     taken into account in determining such percentage.
       ``(2) The estimated amount of all investment returns for 
     the original plan during the preceding plan year.
       ``(3) The market value of the assets of the plan 
     (determined as provided in paragraph (1)) as of the last day 
     of the plan year preceding such plan year.
       ``(4) The total value of all contributions made by 
     employers and employees during the plan year preceding such 
     plan year.
       ``(5) The total value of all benefits paid during the plan 
     year preceding such plan year.
       ``(6) Cash flow projections for such plan year and the 29 
     succeeding plan years, and the assumptions used in making 
     such projections.
       ``(7) Funding standard account projections for such plan 
     year and the 9 succeeding plan years, and the assumptions 
     used in making such projections.
       ``(8) Any significant reduction in the number of active 
     participants during the plan year preceding such plan year, 
     and the reason for such reduction.
       ``(9) A list of employers that withdrew from the plan in 
     the plan year preceding such plan year, and the resulting 
     reduction in contributions.
       ``(10) A list of employers that paid withdrawal liability 
     to the plan during the plan year preceding such plan year 
     and, for each employer, a total assessment of the withdrawal 
     liability paid, the annual payment amount, and the number of 
     years remaining in the payment schedule with respect to such 
     withdrawal liability.
       ``(11) Any material changes to benefits, accrual rates, or 
     contribution rates during the plan year preceding such plan 
     year, and whether such changes relate to the conditions of 
     the partition assistance.
       ``(12) Details regarding any funding improvement plan or 
     rehabilitation plan and updates to such plan.
       ``(13) The number of participants and beneficiaries during 
     the plan year preceding such plan year who are active 
     participants, the number of participants and beneficiaries in 
     pay status, and the number of terminated vested participants 
     and beneficiaries.
       ``(14) For--
       ``(A) the first plan year after the effective date of the 
     partition, a list of all employers that contributed to the 
     plan during the plan year; and
       ``(B) subsequent plan years, changes to the list of 
     contributing employers.
       ``(15) The information contained on the most recent annual 
     return under section 6058 of the Internal Revenue Code of 
     1986 and actuarial report under section 6059 of such Code of 
     the plan.
       ``(16) Copies of the plan document and amendments, other 
     retirement benefit or ancillary benefit plans relating to the 
     plan and contribution obligations under such plans, a 
     breakdown of administrative expenses of the plan, participant 
     census data and distribution of benefits, the most recent 
     actuarial valuation report as of the plan year, financial 
     reports, and copies of the portions of collective bargaining 
     agreements relating to plan contributions, funding coverage, 
     or benefits, and such other information as the corporation 
     may reasonably require.
       ``(17) A list of the employers that contributed more than 5 
     percent of total contributions to the plan during the 
     preceding plan year, and the amount contributed by each such 
     employer.
     Any information or documentary material submitted to the 
     corporation pursuant to this subsection that could identify 
     individual employers, if clearly designated by the person 
     making the submission as confidential (on each page in the 
     case of a document, and in the file name in the case of a 
     digital file), shall be exempt from disclosure under section 
     552 of title 5, United States Code, and no such information 
     or documentary material may be made public except as may be 
     relevant to any administrative or judicial action or 
     proceeding, including an informal rulemaking.
       ``(p) Restrictions on Contribution Decreases.--
       ``(1) In general.--Subject to paragraph (2), except in any 
     plan year in which the plan is certified by the plan actuary 
     as in unrestricted status pursuant to section 305(b)(1)(B), 
     the plan sponsor of an original plan may not accept a 
     collective bargaining agreement with respect to such original 
     plan that includes a reduction in employer contribution 
     rates.
       ``(2) Exception.--Under a process to be promulgated by 
     regulation by the corporation, a plan sponsor of an original 
     plan may petition the corporation for the authority to 
     approve a collective bargaining agreement that contemplates a 
     reduction in employer contribution rates. Such regulation 
     shall include a requirement that a plan petitioning for such 
     authority demonstrate that its existing contribution rates 
     are higher than contribution rates paid on behalf of other 
     workers covered by collective bargaining agreements in the 
     same industry in nearby localities. The corporation shall 
     approve the petition if the plan sponsor demonstrates that 
     the reduction in contribution rates improves the long-term 
     funding or solvency of the plan, and does not increase the 
     corporation's expected loss with respect to the plan.
       ``(q) Effect on Accumulated Funding Deficiency.--Any 
     accumulated funding deficiency (as defined in section 304(a)) 
     of a plan shall be reduced to zero as of the first day of the 
     plan year during which the partition under this section is 
     effective.
       ``(r) Coordination of Reporting and Disclosure 
     Requirements.--The corporation, the Secretary, and the 
     Secretary of the Treasury may, individually or collectively, 
     promulgate regulations to reduce reporting and disclosure 
     obligations for successor plans, including coordinating with 
     reporting and disclosure by original plans.''.
       (b) Conforming Amendment.--Section 4233 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1413) is 
     amended by adding at the end the following:
       ``(g) This section shall not apply to an eligible 
     multiemployer plan described in section 4233A(b) that 
     receives a special partition under that section.''.
       (c) Clerical Amendment.--The table of contents in section 1 
     of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1001 et seq.) is amended by inserting after the item 
     relating to section 4233 the following:

``4233A. Special partitions of eligible multiemployer plans.''.

                        Subtitle B--PBGC Reforms

     SEC. 111. GUARANTEE RATE INCREASE FOR PLANS RECEIVING 
                   FINANCIAL ASSISTANCE.

       (a) In General.--Section 4022A(c)(1) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1322(c)(1)) 
     is amended by striking subparagraph (A) and inserting the 
     following:
       ``(A) 100 percent of the accrual rate up to $15, plus 75 
     percent of the lesser of--
       ``(i) $54.67, or
       ``(ii) the accrual rate, if any, in excess of $15, and''.
       (b) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     apply to financial assistance provided by the Pension Benefit 
     Guaranty Corporation--
       (A) to plans that become insolvent after the date of the 
     enactment of this Act; or
       (B) pursuant to a special partition under section 4233A of 
     the Employee Retirement Income Security Act of 1974, as added 
     by this Act.
       (2) Exception for partitions on or before date of 
     enactment.--The amendments made by this section shall not 
     apply to financial assistance provided by the Pension Benefit 
     Guaranty Corporation pursuant to a partition of a 
     multiemployer plan occurring on or before the date of the 
     enactment of this Act.

     SEC. 112. AMENDMENT TO DEFINITION OF INSOLVENCY.

       (a) Amendments to Employee Retirement Income Security Act 
     of 1974.--Section 4245

[[Page S7597]]

     of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1426) is amended--
       (1) by amending subsection (a) to read as follows:
       ``(a) Notwithstanding sections 203 and 204, an insolvent 
     multiemployer plan shall suspend the payments of benefits 
     which are not basic benefits, in accordance with this 
     section, and terminate the plan under section 4041A(a)(4).'';
       (2) in subsection (b)--
       (A) by striking paragraphs (1) and (2) and inserting the 
     following:
       ``(1) a multiemployer plan is insolvent if the plan's 
     available resources in any of the next 5 plan years are 
     projected not to be sufficient to pay benefits under the plan 
     when due for the plan year;'';
       (B) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively; and
       (C) in paragraph (2), as so redesignated, by inserting 
     ``expected'' before ``contributions'';
       (3) by striking subsection (c);
       (4) by redesignating subsections (d) through (g) as 
     subsections (c) through (f), respectively;
       (5) in subsection (c), as so redesignated--
       (A) in paragraph (1)--
       (i) by striking ``critical status, as described in 
     subsection 305(b)(2),)'' and inserting ``such critical 
     status)'';
       (ii) by striking ``3 times'' and inserting ``10 times''; 
     and
       (iii) by striking ``5 plan years'' each place such term 
     appears and inserting ``8 plan years'';
       (B) in paragraph (2)--
       (i) by striking ``plan's available resources are not 
     sufficient to pay benefits under the plan when due for the 
     next plan year'' and inserting ``plan will be insolvent in 
     any of the next 10 plan years''; and
       (ii) by inserting ``and the corporation'' before the period 
     at the end;
       (C) by striking paragraph (3); and
       (D) by redesignating paragraph (4) as paragraph (3).
       (6) in subsection (d), as so redesignated--
       (A) in paragraph (1)--
       (i) by striking ``subsection (d)(1) or (2)'' and inserting 
     ``subsection (c)(1) or (2)''; and
       (ii) by striking ``Treasury,'' in subparagraph (A) and 
     inserting ``Treasury and'';
       (B) in paragraph (2)--
       (i) by striking ``resource benefit level determined in 
     writing for that insolvency year'' and inserting ``reduction 
     of benefit payments to the level of basic benefits and the 
     termination of the plan under section 4041A(a)(4) as of the 
     first day of the seventh full plan month of the plan's first 
     insolvency year under subsection (b)(3)''; and
       (ii) by striking ``each insolvency year'' and inserting 
     ``the first insolvency year'';
       (C) by striking paragraph (3); and
       (D) by redesignating paragraphs (4) and (5) as paragraphs 
     (3) and (4), respectively;
       (7) in subsection (e), as so redesignated--
       (A) in paragraph (1) by striking ``, for which the resource 
     benefit level is above the level of basic benefits,''; and
       (B) by striking paragraph (2) and inserting after paragraph 
     (1) the following new paragraph:
       ``(2) A plan sponsor who has determined that the plan's 
     available resources for an insolvency year are below the 
     level of basic benefits shall apply for financial assistance 
     from the corporation under section 4261.''; and
       (8) in subsection (f), as so redesignated, by striking 
     ``Subsections (a) and (c)'' and inserting ``Subsection (a)''.
       (b) Amendments to Internal Revenue Code of 1986.--Section 
     418E of the Internal Revenue Code of 1986 is amended--
       (1) by amending subsection (a) to read as follows:
       ``(a) Suspension of Certain Benefit Payments; 
     Termination.--Notwithstanding section 411, an insolvent 
     multiemployer plan shall suspend the payments of benefits 
     which are not basic benefits, in accordance with this 
     section, and terminate the plan under section 4041A(a)(4) of 
     the Employee Retirement Income Security Act of 1974.'';
       (2) in subsection (b)--
       (A) by striking paragraphs (1) and (2) and inserting the 
     following:
       ``(1) Insolvent multiemployer plan.--A multiemployer plan 
     is insolvent if the plan's available resources in any of the 
     next 5 plan years are projected not to be sufficient to pay 
     benefits under the plan when due for the plan year.'';
       (B) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively; and
       (C) in paragraph (2), as so redesignated, by inserting 
     ``expected'' before ``contributions'';
       (3) by striking subsection (c);
       (4) by redesignating subsections (d) through (h) as 
     subsections (c) through (g), respectively;
       (5) in subsection (c), as so redesignated--
       (A) in paragraph (1)--
       (i) by striking ``critical status, as described in 
     subsection 432(b)(2))'' and inserting ``such critical 
     status)'';
       (ii) by striking ``3 times'' and inserting ``10 times''; 
     and
       (iii) by striking ``5 plan years'' each place such term 
     appears and inserting ``8 plan years'';
       (B) in paragraph (2)--
       (i) by striking ``plan's available resources are not 
     sufficient to pay benefits under the plan when due for the 
     next plan year'' and inserting ``plan will be insolvent in 
     any of the next 10 plan years''; and
       (ii) by inserting ``and the corporation'' before the period 
     at the end;
       (C) by striking paragraph (3); and
       (D) by redesignating paragraph (4) as paragraph (3);
       (6) in subsection (d), as so redesignated--
       (A) in paragraph (1), by striking ``subsection (d)(1) or 
     (2)'' and inserting ``subsection (c)(1) or (2)'';
       (B) in paragraph (2)--
       (i) by striking ``resource benefit level determined in 
     writing for that insolvency year'' and inserting ``reduction 
     of benefit payments to the level of basic benefits and the 
     termination of the plan under section 4041A(a)(4) of the 
     Employee Retirement Income Security Act of 1974 as of the 
     first day of the seventh full plan month of the plan's first 
     insolvency year under subsection (b)(3)'';
       (ii) by striking ``each insolvency year'' and inserting 
     ``the first insolvency year''; and
       (iii) by striking ``Resource benefit level'' in the heading 
     and inserting ``Notice of insolvency'';
       (C) by striking paragraph (3); and
       (D) by redesignating paragraphs (4) and (5) as paragraphs 
     (3) and (4), respectively;
       (7) in subsection (e), as so redesignated--
       (A) in paragraph (1) by striking ``, for which the resource 
     benefit level is above the level of basic benefits,''; and
       (B) by striking paragraph (2) and inserting after paragraph 
     (1) the following new paragraph:
       ``(2) Plans without available resources.--A plan sponsor 
     who has determined that the plan's available resources for an 
     insolvency year are below the level of basic benefits shall 
     apply for financial assistance from the Pension Benefit 
     Guaranty Corporation under section 4261 of the Employee 
     Retirement Income Security Act of 1974.''; and
       (8) in subsection (g), as so redesignated, by striking 
     ``Subsections (a) and (c)'' and inserting ``Subsection (a)''.
       (c) Regulations.--The Pension Benefit Guaranty Corporation 
     shall issue regulations implementing the amendments made by 
     this section. Such regulations shall address the assumptions 
     a plan may use in projecting whether a plan's available 
     resources in any of the next 5 plan years are projected not 
     to be sufficient to pay benefits under the plan when due.

     SEC. 113. TERMINATION OF MULTIEMPLOYER PLANS.

       (a) Termination by Court Order.--Section 4041A of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1341a) is amended by adding at the end the following:
       ``(g) Effect of Termination Order.--If a court orders the 
     termination of a multiemployer plan under section 4042--
       ``(1) the corporation shall determine whether the 
     termination of such plan shall be carried out in accordance 
     with paragraph (1) or (2) of subsection (a) (and such 
     termination shall be treated as described in whichever of 
     such paragraphs is applicable under the determination), and
       ``(2) the plan shall take such actions as the corporation 
     determines necessary to implement the corporation's 
     determination under paragraph (1) by such date as the 
     corporation specifies in such determination.''.
       (b) Termination by Reason of Insolvency.--
       (1) In general.--Section 4041A(a) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1341a(a)) 
     is amended--
       (A) in paragraph (2), by striking ``or'' at the end;
       (B) in paragraph (3)--
       (i) by striking ``section 4203(b)(1)'' and inserting 
     ``section 4021(b)(1)''; and
       (ii) by striking the period and inserting ``; or''; and
       (C) by adding at the end the following:
       ``(4) becoming insolvent (within the meaning of section 
     4245(b)(1).''.
       (2) Time of termination.--Section 4041A(b) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1341a(b)) 
     is amended by adding at the end the following new paragraphs:
       ``(3) Except as provided in paragraph (4), the date on 
     which a plan terminates under paragraph (4) of subsection (a) 
     is the first day of the seventh full plan month of the plan's 
     first insolvency year under section 4245(b)(3).
       ``(4)(A) In the case of a multiemployer plan which is an 
     insolvent plan on the date of enactment of this paragraph--
       ``(i) paragraph (4) of subsection (a) shall apply to such 
     plan unless such plan applies for, and receives, a special 
     partition under section 4233A, and
       ``(ii) the date on which plan terminates shall be 
     determined under subparagraph (B).
       ``(B) In the case of a plan described in subparagraph (A), 
     the date on which a plan terminates under paragraph (4) of 
     subsection (a) is--
       ``(i) if the plan is not eligible for a special partition 
     under section 4233A, the first day of the seventh full plan 
     month following such date of enactment, except that such plan 
     may, notwithstanding the amendment required to be adopted by 
     the plan under section 4245(a), continue to provide service 
     credit solely for purposes of vesting under the plan until 
     such time as the plan's available resources are not 
     sufficient to pay benefits under the plan, and
       ``(ii) if the plan applies for such special partition but 
     the corporation does not approve it, the first day of the 
     seventh full plan month following the final determination of 
     the corporation disallowing such special partition.''.
       (3) Adoption of amendment providing for no service 
     credit.--Section 4245(a) of such

[[Page S7598]]

     Act (29 U.S.C. 1426(a)), as amended by this Act, is amended 
     by adding at the end the following: ``The insolvent 
     multiemployer plan shall also, at the time of becoming 
     insolvent, adopt an amendment which provides that 
     participants will receive no credit for any purpose under the 
     plan for service with any employer after the date specified 
     in 4041A(b)(3) or (4), whichever is applicable.''
       (4) Other amendments.--Section 4041A of such Act of 1974 
     (29 U.S.C. 1341a) is amended--
       (A) in subsection (c)--
       (i) in the matter preceding paragraph (1)--

       (I) by striking ``Except'' and inserting ``Consistent with 
     the provisions of section 4281, and except''; and
       (II) by striking ``paragraph (2)'' and inserting 
     ``paragraph (1), (2), or (4)'';

       (ii) in paragraph (1), by striking ``and'' at the end;
       (iii) by redesignating paragraph (2) as paragraph (3); and
       (iv) by inserting after paragraph (1) the following:
       ``(2) suspend the payment of benefits in excess of the 
     level of basic benefits, and'';
       (B) by striking subsection (d) and redesignating 
     subsections (e) and (f) as subsections (d) and (e), 
     respectively; and
       (C) in subsection (d), as so redesignated--
       (i) by striking ``paragraph (1) or (3)'' and inserting 
     ``paragraph (1), (3), or (4)'';
       (ii) by striking ``termination date, unless'' and inserting 
     ``termination date and the total contribution amount shall be 
     not less than the average amount of the highest 3 
     contributions in the previous 10 years, unless''; and
       (iii) by adding at the end the following new sentence: 
     ``Any liability under section 4201 due by an employer that 
     withdraws from the plan after the plan termination date shall 
     be offset by the contributions made under this subsection 
     subsequent to the plan termination.''.
       (c) Pooling of Assets.--Section 4041A of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1341a), as 
     amended by this section, is further amended by adding at the 
     end the following:
       ``(g) Pooling of Assets.--Notwithstanding any other 
     provision of this title, the corporation is authorized to 
     pool assets of terminated or insolvent multiemployer plans 
     with fewer than 5,000 participants or to consolidate such 
     plans by merger, for purposes of administration, investment, 
     payment of liabilities of all such plans, and such other 
     purposes as it determinates to be appropriate in the 
     administration of this title, if it determines that such 
     action would reduce administrative expenses or avoid an 
     increased risk of loss. The corporation may exercise this 
     consolidation authority by administrative action without 
     petitioning a court for an order to replace the plan's 
     governing board of trustees, including receivership by the 
     corporation, or to consolidate or merge any plans.''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect on the date of enactment of this section, 
     except that the amendments made by subsection (b) shall also 
     apply to multiemployer plans that are insolvent on such date.

     SEC. 114. BENEFITS UNDER CERTAIN TERMINATED PLANS.

       Section 4281 of the Employee Retirement Income Security Act 
     of 1974 (29 U.S.C. 1441) is amended--
       (1) in subsection (a), by striking ``section 4041A(d)'' and 
     inserting ``Section 4041A(c)'';
       (2) by striking subsections (b), (c), and (d); and
       (3) by inserting after subsection (a) the following:
       ``(b)(1) If a plan has been terminated pursuant to 
     paragraph (1), (2), or (4) of section 4041A(a), the plan 
     sponsor shall amend the plan to suspend benefits in excess of 
     the level of basic benefits.
       ``(2) Any plan amendment required by this subsection shall, 
     in accordance with regulations prescribed by the corporation, 
     take effect not later than 6 months after the date on which 
     the plan is terminated.
       ``(c)(1) The value of nonforfeitable benefits under a 
     terminated plan described in subsection (a), and the value of 
     the plan's assets, shall be determined in writing, in 
     accordance with regulations prescribed by the corporation, as 
     of the end of the plan year during which section 4041A(c) 
     becomes applicable to such plan.
       ``(2) For purposes of this subsection, plan assets include 
     outstanding claims for withdrawal liability (within the 
     meaning of section 4001(a)(12).
       ``(3) If, according to the determination made under 
     paragraph (1), the value of plan assets is sufficient to pay 
     nonforfeitable benefits, the plan sponsor shall use the plan 
     assets to purchase irrevocable commitments to provide such 
     benefits from an insurer or otherwise distribute plan assets 
     in satisfaction of the plan's obligations with respect to 
     nonforfeitable benefits, in accordance with all applicable 
     regulations.
       ``(d)(1) If, according to the determination made under 
     subsection (c)(1), the value of nonforfeitable benefits 
     exceeds the value of the plan's assets, the plan sponsor 
     shall amend the plan to reduce benefits under the plan as 
     provided in paragraph (2).
       ``(2) Any plan amendment required by paragraph (1) shall, 
     in accordance with regulations prescribed by the 
     corporation--
       ``(A) reduce benefits to the extent necessary to eliminate 
     any benefits that are not nonforfeitable;
       ``(B) reduce accrued benefits to the extent that those 
     benefits are not eligible for the corporation's guarantee 
     under section 4022A(b); and
       ``(C) suspend payment of benefits which are not basic 
     benefits under section 4022A(c).
       ``(e) The powers and duties under this section of a sponsor 
     of a plan that is terminated as described in section 4041A, 
     before or after the plan begins receiving financial 
     assistance under section 4261, shall be prescribed by the 
     corporation, and the corporation shall prescribe by 
     regulation the requirements which assure that plan 
     participants and beneficiaries receive adequate notice of any 
     suspension of benefits.''.

                 Subtitle C--Pension Insurance Modeling

     SEC. 121. PENSION INSURANCE MODELING.

       Section 40233(a) of the Moving Ahead for Progress in the 
     21st Century Act (126 Stat. 857; Public Law 112-141) is 
     amended--
       (1) in the subsection heading, by striking ``Annual'';
       (2) by striking ``The Pension'' and inserting ``Not later 
     than January 1, 2025, and not less frequently than once every 
     5 years thereafter, the Pension'';
       (3) by striking ``an annual peer review'' and inserting ``a 
     peer review''; and
       (4) by striking the third sentence.

    TITLE II--FUNDING RULES, WITHDRAWAL LIABILITY, AND OTHER REFORMS

      Subtitle A--Minimum Funding Standard for Multiemployer Plans

     SEC. 201. VALUATION OF PLAN LIABILITIES.

       (a) Amendments to Internal Revenue Code of 1986.--
       (1) Charges to funding standard account.--Subparagraph (B) 
     of section 431(b)(2) of the Internal Revenue Code of 1986 is 
     amended--
       (A) by striking ``and'' at the end of clause (iii),
       (B) by redesignating clause (iv) as clause (v),
       (C) by striking ``actuarial assumptions'' in clause (v), as 
     so redesignated, and inserting ``actuarial assumptions not 
     described in clause (iv)'', and
       (D) by inserting after clause (iii) the following new 
     clause:
       ``(iv) separately, with respect to each plan year, an 
     amount equal to the excess, if any, of--

       ``(I) the net increase (if any) in the unfunded past 
     service liability resulting from a reduction in the interest 
     rate under paragraph (6)(A) from the rate which applied for 
     the preceding year, over
       ``(II) the amount in the investment risk reduction 
     subaccount under paragraph (9),

     over a period of 30 years, and''.
       (2) Credits to funding standard account.--Clause (iii) of 
     section 431(b)(3)(B) of such Code is amended by inserting ``, 
     except that any amount of net gain resulting from an increase 
     in the interest rate from the rate which applied for the 
     preceding year shall first be offset against any unamortized 
     amounts charged under paragraph (2)(B)(iv)'' after ``15 plan 
     years''.
       (3) Interest.--Paragraph (6) of section 431(b) of such Code 
     is amended to read as follows:
       ``(6) Interest.--
       ``(A) In general.--The funding standard account (and items 
     therein) shall be charged or credited (as determined under 
     regulations prescribed by the Secretary) with interest at the 
     appropriate rate consistent with the rate or rates of 
     interest used under the plan to determine the unfunded past 
     service liability. Notwithstanding any other provision of 
     this section, the interest rate used shall not exceed--
       ``(i) 7.5 percent for actuarial valuations for plan years 
     beginning after December 31, 2020, and before January 1, 
     2024,
       ``(ii) 7.25 percent for actuarial valuations for plan years 
     beginning after December 31, 2023, and before January 1, 
     2028,
       ``(iii) 7.0 percent for actuarial valuations for plan years 
     beginning after December 31, 2027, and before January 1, 
     2032,
       ``(iv) 6.75 percent for actuarial valuations for plan years 
     beginning after December 31, 2031, and before January 1, 
     2036, and
       ``(v) 6.5 percent for actuarial valuations for plan years 
     beginning after December 31, 2035.
     Notwithstanding subsection (c), the plan sponsor may direct 
     the plan actuary to use any rate which is not lower than the 
     rate determined under subparagraph (B) (without regard to 
     this sentence) and not greater than the rate determined under 
     the preceding sentence. for the plan year. Nothing in this 
     subparagraph shall require a plan to take into account the 
     interest rate limitation for subsequent years under the 
     preceding sentence in determining actuarial valuations as of 
     any given year.
       ``(B) Interest rate for determining normal cost.--
     Notwithstanding any other provision of this section, the 
     interest rate used for determining the normal cost to be 
     charged under paragraph (2) for the plan year shall be equal 
     to the least of--
       ``(i) the interest rate applicable under subparagraph (A) 
     for the plan year,
       ``(ii) a rate equal to the 24-month average of the third 
     segment rate (as defined in section 430(h)(2)(C)(iii)), as of 
     the date the determination is made, without regard to section 
     430(h)(2)(C)(iv), increased by 2 percent, or
       ``(iii) 5.5 percent.
       ``(C) Exception for certain partitioned plans.--
     Notwithstanding subparagraph (A), in the case of a plan which 
     has been partitioned under section 4233A of the Employee 
     Retirement Income Security Act of 1974, the rate of interest 
     used to determine normal cost under subparagraph (B) shall 
     also be

[[Page S7599]]

     used to determine the unfunded past service liability of the 
     plan.
       ``(D) Exception for plans using a spread-gain method.--
     Notwithstanding subparagraph (B), and except as noted in 
     subparagraph (C), in the case of a plan which uses a funding 
     method other than the unit credit method or entry-age normal 
     method--
       ``(i) the normal cost and past service liability shall be 
     calculated using interest rates under subparagraph (A),
       ``(ii) an additional normal cost component shall be 
     calculated in the same manner as under paragraph (9)(B)(i) 
     based on the unit credit method, and
       ``(iii) the amount determined under clause (ii) shall be 
     added to the otherwise calculated normal cost under the 
     funding method in lieu of the credit under paragraph 
     (9)(B)(i).''.
       (4) Investment risk reduction subaccount.--Subsection (b) 
     of section 431 of such Code is amended by adding at the end 
     the following new paragraph:
       ``(9) Investment risk reduction subaccount.--For purposes 
     of this part--
       ``(A) In general.--The funding standard account shall 
     include an investment risk reduction subaccount used solely 
     to offset losses attributable to reductions in the rate of 
     interest used to determine the unfunded past service 
     liability of the plan over time.
       ``(B) Annual adjustments.--For a plan year, the investment 
     risk reduction subaccount shall be--
       ``(i) credited with the net change (if any) in the normal 
     cost for the immediately preceding plan year due to 
     recalculation to reflect the difference in interest rates 
     under paragraphs (6)(A) and (6)(B),
       ``(ii) charged with the amount of any reduction applied 
     under paragraph (2)(B)(iv)(II), or, in the case of a plan 
     using a spread-gain method, an amount equal to the lesser 
     of--

       ``(I) the entire remaining balance of such subaccount 
     immediately before the charge, or
       ``(II) the amount of the increase in the present value of 
     benefits resulting from a decrease in the interest rate from 
     the rate which applied for the preceding year,

       ``(iii) at the election of the plan sponsor, and pursuant 
     to regulations to be issued by the Secretary, credited with 
     the net decrease in the unfunded past service liability (or 
     present value of benefits, in the case of a plan using a 
     spread-gain method) resulting from an increase in the 
     interest rate under paragraph (6)(A), not to exceed the 
     amount of any previous charges to the account under clause 
     (ii), reduced by any previous credits under this clause, and
       ``(iv) adjusted with interest at the rate under paragraph 
     (6)(A), as applicable.''.
       (5) Determinations to be made under funding method.--
     Paragraph (1) of section 431(c) of such Code is amended to 
     read as follows:
       ``(1) Determinations to be made under funding method.--
       ``(A) In general.--For purposes of this part, normal costs, 
     accrued liability, and experience gains and losses used to 
     determine the unfunded past service liability for the plan 
     shall be determined under the funding method used to 
     determine costs under the plan and based on the interest rate 
     under subparagraph (A) (or subparagraph (C), if applicable) 
     of subsection (b)(6).
       ``(B) Adjustments for funding standard account normal 
     cost.--Notwithstanding subparagraph (A), in the case of a 
     plan using the unit credit funding method or the entry-age 
     normal funding method, the normal cost for a plan year to be 
     charged to the funding standard account under subsection 
     (b)(2) shall be determined under the funding method used to 
     determine costs under the plan and based on the interest rate 
     under subsection (b)(6)(B).''.
       (b) Amendments to Employee Retirement Income Security Act 
     of 1974.--
       (1) Charges to funding standard account.--Subparagraph (B) 
     of section 304(b)(2) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1084(b)(2)) is amended--
       (A) by striking ``and'' at the end of clause (iii),
       (B) by redesignating clause (iv) as clause (v),
       (C) by striking ``actuarial assumptions'' in clause (v), as 
     so redesignated, and inserting ``actuarial assumptions not 
     described in clause (iv)'', and
       (D) by inserting after clause (iii) the following new 
     clause:
       ``(iv) separately, with respect to each plan year, an 
     amount equal to the excess, if any, of--

       ``(I) the net increase (if any) in the unfunded past 
     service liability resulting from a reduction in the interest 
     rate under paragraph (6)(A) from the rate which applied for 
     the preceding year, over
       ``(II) the amount in the investment risk reduction 
     subaccount under paragraph (9),

     over a period of 30 years, and''.
       (2) Credits to funding standard account.--Clause (iii) of 
     section 304(b)(3)(B) of such Act (29 U.S.C. 1084(b)(3)(B)) is 
     amended by inserting ``, except that any amount of net gain 
     resulting from an increase in the interest rate from the rate 
     which applied for the preceding year shall first be offset 
     against any unamortized amounts charged under paragraph 
     (2)(B)(iv)'' after ``15 plan years''.
       (3) Interest.--
       (A) In general.--Paragraph (6) of section 304(b) of such 
     Act (29 U.S.C. 1084(b)) is amended to read as follows:
       ``(6) Interest.--
       ``(A) In general.--The funding standard account (and items 
     therein) shall be charged or credited (as determined under 
     regulations prescribed by the Secretary) with interest at the 
     appropriate rate consistent with the rate or rates of 
     interest used under the plan to determine the unfunded past 
     service liability. Notwithstanding any other provision of 
     this section, this interest rate shall not exceed--
       ``(i) 7.5 percent for actuarial valuations for plan years 
     beginning after December 31, 2020, and before January 1, 
     2024,
       ``(ii) 7.25 percent for actuarial valuations for plan years 
     beginning after December 31, 2023, and before January 1, 
     2028,
       ``(iii) 7.0 percent for actuarial valuations for plan years 
     beginning after December 31, 2027, and before January 1, 
     2032,
       ``(iv) 6.75 percent for actuarial valuations for plan years 
     beginning after December 31, 2031, and before January 1, 
     2036, and
       ``(v) 6.5 percent for actuarial valuations for plan years 
     beginning after December 31, 2035.
     Notwithstanding subsection (c), the plan sponsor may direct 
     the plan actuary to use any rate which is not lower than the 
     rate determined under subparagraph (B) (without regard to 
     this sentence) and not greater than the rate determined under 
     the preceding sentence. for the plan year. Nothing in this 
     subparagraph shall require a plan to take into account the 
     interest rate limitation for subsequent years under the 
     preceding sentence in determining actuarial valuations as of 
     any given year.
       ``(B) Interest rate for determining normal cost.--
     Notwithstanding any other provision of this section, the 
     interest rate used for determining the normal cost to be 
     charged under paragraph (2) for the plan year shall be equal 
     to the least of--
       ``(i) the interest rate applicable under subparagraph (A) 
     for the plan year,
       ``(ii) a rate equal to the 24-month average of the third 
     segment rate (as defined in section 303(h)(2)(C)(iii)), as of 
     the date the determination is made, without regard to section 
     303(h)(2)(C)(iv), increased by 2 percent, or
       ``(iii) 5.5 percent.
       ``(C) Exception for certain partitioned plans.--
     Notwithstanding subparagraph (A), in the case of a plan which 
     has been partitioned under section 4233A, the rate of 
     interest used to determine normal cost under subparagraph (B) 
     shall also be used to determine the unfunded past service 
     liability of the plan.
       ``(D) Exception for plans using a spread-gain method.--
     Notwithstanding subparagraph (B), and except as noted in 
     subparagraph (C), in the case of a plan which uses a funding 
     method other than the unit credit method or entry-age normal 
     method--
       ``(i) the normal cost and past service liability shall be 
     calculated using interest rates under subparagraph (A),
       ``(ii) an additional normal cost component shall be 
     calculated in the same manner as under paragraph (9)(B)(i) 
     based on the unit credit method, and
       ``(iii) the amount determined under clause (ii) shall be 
     added to the otherwise calculated normal cost under the 
     funding method in lieu of the credit under paragraph 
     (9)(B)(i).''.
       (B) Conforming amendment.--Subparagraph (A) of section 
     4233A(h)(4) of such Act, as added by this Act, is amended by 
     inserting ``, consistent with section 304(b)(6)(C)'' before 
     the period.
       (4) Investment risk reduction subaccount.--Subsection (b) 
     of section 304 of such Act (29 U.S.C. 1084) is amended by 
     adding at the end the following new paragraph:
       ``(9) Investment risk reduction subaccount.--For purposes 
     of this part--
       ``(A) In general.--The funding standard account shall 
     include an investment risk reduction subaccount used solely 
     to offset losses attributable to reductions in the rate of 
     interest used to determine the unfunded past service 
     liability of the plan over time.
       ``(B) Annual adjustments.--For a plan year, the investment 
     risk reduction subaccount shall be--
       ``(i) credited with the net change (if any) in the normal 
     cost for the immediately preceding plan year due to 
     recalculation to reflect the difference in interest rates 
     under paragraphs (6)(A) and (6)(B),
       ``(ii) charged with the amount of any reduction applied 
     under paragraph (2)(B)(iv)(II), or, in the case of a plan 
     using a spread-gain method, an amount equal to the lesser 
     of--

       ``(I) the entire remaining balance of such subaccount 
     immediately before the charge, or
       ``(II) the amount of the increase in the present value of 
     benefits resulting from a decrease in the interest rate from 
     the rate which applied for the preceding year,

       ``(iii) at the election of the plan sponsor, and pursuant 
     to regulations to be issued by the Secretary of the Treasury, 
     credited with the net decrease in the unfunded past service 
     liability (or present value of benefits, in the case of a 
     plan using a spread-gain method) resulting from an increase 
     in the interest rate under paragraph (6)(A), not to exceed 
     the amount of any previous charges to the account under 
     clause (ii), reduced by any previous credits under this 
     clause, and
       ``(iv) adjusted with interest at the rate under paragraph 
     (6)(A), as applicable.''.
       (5) Determinations to be made under funding method.--
     Paragraph (1) of section 304(c) of such Act (29 U.S.C. 
     1084(c)) is amended to read as follows:

[[Page S7600]]

       ``(1) Determinations to be made under funding method.--
       ``(A) In general.--For purposes of this part, normal costs, 
     accrued liability, and experience gains and losses used to 
     determine the unfunded past service liability for the plan 
     shall be determined under the funding method used to 
     determine costs under the plan and based on the interest rate 
     under subparagraph (A) (or subparagraph (C), if applicable) 
     of subsection (b)(6).
       ``(B) Adjustments for funding standard account normal 
     cost.--Notwithstanding subparagraph (A), in the case of a 
     plan using the unit credit funding method or the entry-age 
     normal funding method, the normal cost for a plan year to be 
     charged to the funding standard account under subsection 
     (b)(2) shall be determined under the funding method used to 
     determine costs under the plan and based on the interest rate 
     under subsection (b)(6)(B).''.
       (c) Plan Petitions to Increase Interest Assumptions.--
       (1) In general.--Pursuant to regulations to be issued by 
     the Secretary of the Treasury (or such Secretary's delegate), 
     a multiemployer plan must petition the Secretary of the 
     Treasury (or delegate) for any increase in the interest 
     assumption made after a 30-year amortization base is 
     established in accordance with section 431(b)(2)(B)(iv) of 
     the Internal Revenue Code of 1986 and section 
     304(b)(2)(B)(iv) of the Employee Retirement Income Security 
     Act of 1974 (as added by this Act). The Secretary of the 
     Treasury (or delegate) shall approve such request upon a 
     determination that the change is reasonably supported by 
     changes in the financial markets or changes in the plan's 
     asset allocation, and is consistent with the manner in which 
     prior changes in interest rate assumptions were determined 
     since the date of the enactment of this Act.
       (2) Approval.--If the Secretary of the Treasury (or such 
     Secretary's delegate) does not approve or deny any petition 
     submitted pursuant to paragraph (1) within 180 days of 
     receiving such petition, such petition shall be deemed to 
     have been approved.
       (d) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after December 31, 2020.

      Subtitle B--Additional Funding Rules for Multiemployer Plans

                     PART I--PLAN STATUS AMENDMENTS

     SEC. 211. AMENDMENTS TO INTERNAL REVENUE CODE OF 1986.

       (a) Rules Applying to All Multiemployer Plans.--
       (1) In general.--Subsection (a) of section 432 of the 
     Internal Revenue Code of 1986 is amended--
       (A) by striking ``a multiemployer plan in effect on July 
     16, 2006--'' and inserting ``any multiemployer plan--'',
       (B) by redesignating paragraphs (1), (2), and (3) as 
     paragraphs (2), (3), and (4), respectively,
       (C) by inserting before paragraph (2), as so redesignated, 
     the following new paragraph:
       ``(1) the rules of subsection (c) shall apply,'',
       (D) by striking ``subsection (c)'' in paragraph (2)(A), as 
     so redesignated, and inserting ``subsection (d)'',
       (E) by striking ``subsection (d)'' in paragraph (2)(B), as 
     so redesignated, and inserting ``subsection (e)'',
       (F) by striking ``subsection (e)'' in paragraph (3)(A), as 
     so redesignated, and inserting ``subsection (f)'',
       (G) by striking ``subsection (f)'' in paragraph (3)(B), as 
     so redesignated, and inserting ``subsection (g)'', and
       (H) by striking ``subsection (e)(9)'' in paragraph (4)(B), 
     as so redesignated, and inserting ``subsection (f)(9)''.
       (2) Rules of immediate application.--Section 432 of such 
     Code is amended--
       (A) by redesignating subsections (c), (d), (e), (f), (g), 
     (h), (i), and (j) as subsections (d), (e), (f), (g), (h), 
     (i), (j), and (k), respectively, and
       (B) by inserting after subsection (b) the following new 
     subsection:
       ``(c) Rules Applying to All Multiemployer Plans.--
       ``(1) Benefit increases.--
       ``(A) Increases by plan amendment.--The plan sponsor of any 
     multiemployer plan shall not adopt a plan amendment which 
     increases plan liabilities (as determined as of the date of 
     the adoption of the amendment) due to any increase in 
     benefits, any change in the accrual rate of benefits, or any 
     change in the rate at which benefits become nonforfeitable, 
     unless--
       ``(i) if the plan is in unrestricted status as of the 
     adoption of such amendment, the plan actuary certifies in 
     accordance with subsection (b)(4) that the increase in 
     liabilities will not cause the plan to no longer be in 
     unrestricted status,
       ``(ii) if the plan is in stable status as of the adoption 
     of such amendment, the plan actuary certifies in accordance 
     with subsection (b)(4) that any such increase or change in 
     benefits will be paid from additional contributions not 
     required by any collective bargaining agreement in effect as 
     of the adoption of the amendment,
       ``(iii) if the plan is in endangered status as of the 
     adoption of such amendment, the plan actuary certifies in 
     accordance with subsection (b)(4) that any such increase or 
     change in benefits will be paid from additional contributions 
     not contemplated in any current funding improvement plan, or
       ``(iv) the increase or change in benefits is required by 
     law or is a de minimis change.
       ``(B) Increases under critical or critical and declining 
     status.--Unless required as a condition of qualification 
     under part I of this subchapter or to comply with other 
     applicable law, in the case of a plan which is in critical or 
     critical and declining status, no increase in benefits, 
     change in the accrual rate of benefits, or change in the rate 
     at which benefits become nonforfeitable which increases plan 
     liabilities shall take effect while the plan is in such 
     status, without regard to whether such increase or change 
     would otherwise occur under the provisions of the plan, 
     unless the increase in plan liabilities due to the change is 
     de minimis.
       ``(2) Contribution reductions.--The plan sponsor of any 
     multiemployer plan shall not accept any collective bargaining 
     agreement or participation agreement which reduces the rate 
     of contributions under the plan for any participants, 
     suspends contributions with respect to any period of service, 
     or directly or indirectly excludes younger, probationary, or 
     newly hired employees from participation in the plan, 
     unless--
       ``(A) the plan is in unrestricted status as of the adoption 
     of such agreement and the plan actuary certifies in 
     accordance with subsection (b)(4) that the reduction in 
     contributions will not cause the plan to no longer be in 
     unrestricted status,
       ``(B) the reduction in contributions is accompanied by a 
     reduction in future accruals for the affected participants, 
     and the plan actuary certifies in accordance with subsection 
     (b)(4) that the combined effect of the changes in 
     contributions and benefits is not projected to reduce the 
     funded percentage of the plan in any year, or
       ``(C) subject to regulations issued by the Secretary, the 
     plan sponsor reasonably determines that the acceptance of 
     such an agreement is in the best interests of plan 
     participants and beneficiaries and that rejection of the 
     agreement would have an adverse financial effect on the 
     plan.''.
       (3) Stable and unrestricted plans.--Subsection (b) of 
     section 432 of such Code is amended--
       (A) by striking ``Endangered and Critical'' in the heading,
       (B) by redesignating paragraphs (1), (2), (3), (4), (5), 
     and (6) as paragraphs (2), (3), (4), (5), (6), and (7), 
     respectively, and
       (C) by inserting before paragraph (2) the following new 
     paragraph:
       ``(1) Stable and unrestricted status.--
       ``(A) Stable.--A multiemployer plan is in stable status for 
     a plan year if, as determined by the plan actuary under 
     paragraph (4), the plan is not in unrestricted status for the 
     plan year, is not in endangered, critical, or critical and 
     declining status for the plan year, and is not described in 
     paragraph (6).
       ``(B) Unrestricted.--A multiemployer plan is in 
     unrestricted status for a plan year if, as determined by the 
     plan actuary under paragraph (4)--
       ``(i) the plan is not in endangered, critical, or critical 
     and declining status for the plan year,
       ``(ii) the plan is not described in paragraph (6), and
       ``(iii) as of the beginning of the plan year--

       ``(I) the plan's current liability funded percentage for 
     such plan year is at least 70 percent and the plan's 
     projected funded percentage as of the first day of the 15th 
     succeeding plan year is at least 115 percent, or
       ``(II) the plan's current liability funded percentage for 
     such plan year is at least 80 percent.

       ``(C) Current liability funded percentage.--For purposes of 
     this section, the term `current liability funded percentage' 
     means the percentage equal to a fraction the numerator of 
     which is the value of plan assets (as determined for purposes 
     of section 431(c)(6)(A)(ii)(II)) and the denominator of which 
     is the current liabilities of the plan (as defined in section 
     431(c)(6)(D)).''.
       (4) Amendment to annual certification by plan actuary.--
     Subparagraph (A) of paragraph (4) (as redesignated by 
     paragraph (3)) of section 432(b) of such Code is amended by 
     inserting ``whether or not the plan is in unrestricted or 
     stable status for such plan year,'' in clause (i) before 
     ``whether or not the plan is in endangered status''.
       (5) Conforming amendments.--
       (A) Paragraphs (2) and (3) of section 432(b) of such Code, 
     as redesignated by paragraph (3), are each amended by 
     striking ``paragraph (3)'' and inserting ``paragraph (4)''.
       (B) Section 432(b)(2) of such Code, as so redesignated and 
     amended, is further amended by striking ``paragraph (5)'' and 
     inserting ``paragraph (6)''.
       (C) Section 432(b)(4) of such Code, as so redesignated, is 
     amended--
       (i) by striking ``paragraph (4)'' in subparagraph (B)(iv) 
     thereof and inserting ``paragraph (5)'',
       (ii) by striking ``subsection (e)(9)'' both places it 
     appears in subparagraph (B)(v) and inserting ``subsection 
     (f)(9)'',
       (iii) by striking ``subsection (e)(3)(A)(ii)'' in 
     subparagraph (B)(v) and inserting ``subsection 
     (f)(3)(A)(ii)'',
       (iv) by striking ``subsection (e)'' in subparagraph (B)(v) 
     and inserting ``subsection (f)'',
       (v) by striking ``paragraph (4)'' each place it appears in 
     subparagraphs (D)(i) and (D)(v) thereof and inserting 
     ``paragraph (5)'',
       (vi) by striking ``subsection (e)(8)'' in subparagraph 
     (D)(ii)(I) thereof and inserting ``subsection (f)(8)'',
       (vii) by striking ``paragraph (5)'' in subparagraph 
     (D)(iii) thereof and inserting ``paragraph (6)'', and

[[Page S7601]]

       (viii) by striking ``(iii) In the case of'' in subparagraph 
     (D)(iii) thereof and inserting ``(iii) Special rule.--''.
       (D) Section 432(b)(5) of such Code, as redesignated by 
     paragraph (3), is amended--
       (i) by striking ``paragraph (2)'' and inserting ``paragraph 
     (3)'',
       (ii) by striking ``paragraph (3)(B)(iv)'' and inserting 
     ``paragraph (4)(B)(iv)'',
       (iii) by striking ``paragraph (3)'' in subparagraph (A) 
     thereof and inserting ``paragraph (4)'',
       (iv) by striking ``paragraph (3)(A)'' in subparagraph (A) 
     thereof and inserting ``paragraph (4)(A)'',
       (v) by striking ``paragraph (2)'' in subparagraph (B) 
     thereof and inserting ``paragraph (3)'', and
       (vi) by striking ``subsection (e)(4)(B)'' in subparagraph 
     (C) thereof and inserting ``subsection (f)(4)(B)''.
       (E) Section 432(b)(6)(A) of such Code, as so redesignated, 
     is amended--
       (i) by striking ``paragraph (3)(A)'' and inserting 
     ``paragraph (4)(A)'',
       (ii) by striking ``paragraph (1)(A)'' and inserting 
     ``paragraph (2)(A)'', and
       (iii) by striking ``paragraph (1)(B)'' and inserting 
     ``paragraph (2)(B)''.
       (F) Section 432(b)(7) of such Code, as so redesignated, is 
     amended by striking ``paragraph (2)'' and inserting 
     ``paragraph (3)''.
       (G) Paragraphs (1)(A), (4)(A)(ii), (4)(C)(i), (4)(C)(ii), 
     (4)(D), (5)(A)(i), (5)(B), and (8) of subsection (d), and 
     subsections (e)(2), (f)(1)(A), (f)(4)(B)(i), 
     (f)(4)(B)(ii)(I), (f)(5), and (g)(3) of section 432 of such 
     Code, as respectively redesignated by paragraph (2), are each 
     amended by striking ``subsection (b)(3)(A)'' and inserting 
     ``subsection (b)(4)(A)''.
       (H) Section 432(d)(3)(A)(i)(I) of such Code, as so 
     redesignated, is amended by striking ``paragraph (b)(3)'' and 
     inserting ``subsection (b)(4)''.
       (I) Section 432(d)(4)(D) of such Code, as so redesignated, 
     is amended by striking ``subsection (d)'' and inserting 
     ``subsection (e)''.
       (J) Section 432(e) of such Code, as so redesignated, is 
     amended to read as follows:
       ``(e) Rules for Operation of Plan During Adoption and 
     Improvement Periods.--A plan may not be amended after the 
     date of the adoption of a funding improvement plan under 
     subsection (d) so as to be inconsistent with the funding 
     improvement plan or the requirements of subsection (c).''.
       (K) Clauses (i)(I) and (ii)(I) of section 432(f)(4)(B) of 
     such Code, as so redesignated, are each amended by striking 
     ``subsection (b)(2)'' and inserting ``subsection (b)(3)''.
       (L) Subsections (f)(8)(A)(ii) and (g)(2)(A) of section 432 
     of such Code, as so redesignated, are each amended by 
     striking ``subsection (b)(3)(D)'' and inserting ``subsection 
     (b)(4)(D)''.
       (M) Section 432(f)(9)(J) of such Code, as so redesignated, 
     is amended--
       (i) by striking ``subsection (b)(3)'' and inserting 
     ``subsection (b)(4)'', and
       (ii) by striking ``paragraphs (1) and (2)'' in clause (i) 
     thereof and inserting ``paragraphs (2) and (3)''.
       (N) Subparagraphs (A) and (B) of section 432(g)(1) of such 
     Code, as so redesignated, are each amended by striking 
     ``subsection (e)'' and inserting ``subsection (f)''.
       (O) Paragraph (2)(A) of section 432(g) of such Code, as so 
     redesignated, is amended by striking ``(b)(3)(D)'' and 
     inserting ``(b)(4)(D)''.
       (P) Section 432(h) of such Code, as so redesignated, is 
     amended--
       (i) by striking ``subsection (e)(8) or (f)'' in paragraph 
     (1) thereof and inserting ``subsection (f)(8) or (g)'',
       (ii) by striking ``subsection (e)(9)'' in paragraph (1) 
     thereof and inserting ``subsection (f)(9)'',
       (iii) by striking ``subsection (e)(7)'' in paragraph (2) 
     thereof and inserting ``subsection (f)(7)'', and
       (iv) by striking ``rehabilitation plan'' and all that 
     follows in paragraph (3)(B) thereof and inserting 
     ``rehabilitation plan. The preceding sentence shall not apply 
     to any increase in contribution requirements due to increased 
     levels of work, employment, or periods for which compensation 
     is provided, except to the extent such an increase is used to 
     provide an increased accrual rate of benefits or change in 
     the rate at which benefits become nonforfeitable which 
     increases plan liabilities.''.
       (Q) Section 432(i) of such Code, as so redesignated, is 
     amended--
       (i) by striking ``subsection (c)'' and inserting 
     ``subsection (d)'', and
       (ii) by striking ``subsection (e)'' and inserting 
     ``subsection (f)''.
       (R) Section 432(j)(2) of such Code, as so redesignated, is 
     amended by striking ``subsections (c) and (e)'' and inserting 
     ``subsections (d) and (f)''.
       (S) Section 412(b)(3) of such Code is amended by striking 
     ``section 432(e)'' and inserting ``section 432(f)''.
       (T) Section 418E of such Code, as amended by this Act, is 
     further amended--
       (i) by striking ``432(b)(2)'' each place it appears in 
     subsections (c)(1), (c)(2), (d)(1), and (d)(2), as 
     redesignated by section 112, and inserting ``432(b)(3)'', and
       (ii) by striking ``432(e)(9)'' in subsection (g), as so 
     redesignated, and inserting ``432(f)(9)''.
       (U) Section 4971(g) of such Code is amended--
       (i) by striking ``432(e)'' in paragraph (3)(B)(i) and 
     inserting ``432(f)'',
       (ii) by striking ``432(b)(3)(A)(ii)'' in paragraph 
     (3)(B)(ii) and inserting ``432(b)(4)(A)(i)(II)'',
       (iii) by striking ``432(e)(1)(A)'' in paragraph (4)(B)(ii) 
     and inserting ``432(f)(1)(A)'', and
       (iv) by striking ``432(j)(9)'' in paragraph (4)(C)(ii) and 
     inserting ``432(k)(9)''.
       (V) Subsection (c)(1) of section 4980I of such Code, as 
     added by this Act, is amended by adding at the end the 
     following: ``Such term shall not include such an original 
     plan for any plan year in which the plan is in unrestricted 
     status (as defined in section 432(b)(1)(B)).''.
       (W) The heading of section 432 of such Code is amended by 
     striking ``in endangered status or critical status''.
       (6) Withdrawal liability determination for plans emerging 
     from endangered or critical status.--Section 432(h) of such 
     Code, as redesignated by paragraph (2) and as amended by 
     paragraph (5), is further amended by striking paragraph (4) 
     and by inserting after paragraph (3) the following new 
     paragraph:
       ``(4) Emergence from endangered or critical status.--
       ``(A) In general.--In the case of increases in the 
     contribution rate (or other increases in contribution 
     requirements unless due to increased levels of work, 
     employment, or periods for which compensation is provided) 
     disregarded pursuant to paragraph (3), this subsection shall 
     cease to apply as of the later of--
       ``(i) the end of the first plan year following the plan 
     year in which the plan is no longer in endangered or critical 
     status, or
       ``(ii) the end of the plan year which includes the 
     expiration date of the first collective bargaining agreement 
     requiring plan contributions which expires after the plan is 
     no longer in endangered or critical status.
       ``(B) Highest contribution rate.--Notwithstanding 
     subparagraph (A), once the plan emerges from endangered or 
     critical status--
       ``(i) increases in the contribution rate disregarded 
     pursuant to paragraph (3) shall continue to be disregarded in 
     determining the highest contribution rate under section 
     4219(c) of such Act for plan years during which the plan was 
     in endangered or critical status, and
       ``(ii) the highest contribution rate for purposes of such 
     section shall be the greater of--

       ``(I) the sum of--

       ``(aa) the employer's contribution rate as of the later of 
     the last day of the last plan year ending before December 31, 
     2014, and the last day of the plan year for which the 
     employer first had an obligation to contribute to the plan, 
     and
       ``(bb) any contribution increases determined in accordance 
     with this section after such later date and before the date 
     the employer withdraws from the plan, or

       ``(II) the highest contribution rate for any plan year 
     after the plan year which includes the earlier of--

       ``(aa) the expiration date of the first collective 
     bargaining agreement applicable to the withdrawing employer 
     requiring plan contributions which expires after the plan is 
     no longer in endangered or critical status, or
       ``(bb) the date as of which the withdrawing employer 
     negotiated a contribution rate effective after the plan year 
     in which the plan is no longer in endangered or critical 
     status.''.
       (7) Effective date.--The amendments made by this subsection 
     shall take effect on the date of the enactment of this Act.
       (b) Determination of Endangered Status.--Paragraph (2) of 
     section 432(b) of the Internal Revenue Code of 1986, as 
     redesignated by subsection (a)(3), is amended to read as 
     follows:
       ``(2) Endangered status.--A multiemployer plan is in 
     endangered status for a plan year if, as determined by the 
     plan actuary under paragraph (5), the plan is not in critical 
     or declining status for the plan year and is not described in 
     paragraph (7), and, as of the beginning of the plan year--
       ``(A) the plan's funded percentage for such plan year is 
     less than 80 percent,
       ``(B) the plan is projected to have an accumulated funding 
     deficiency for any of the 9 succeeding plan years, taking 
     into account any extension of amortization periods under 
     section 431(d), or
       ``(C) the plan's projected funded percentage as of the 
     first day of the 15th succeeding plan year is less than 100 
     percent.''.
       (c) Determination of Critical Status.--Paragraph (3) of 
     section 432(b) of the Internal Revenue Code of 1986, as 
     redesignated by subsection (a)(3), is amended to read as 
     follows:
       ``(3) Critical status.--
       ``(A) In general.--A multiemployer plan is in critical 
     status for a plan year if, as determined by the plan actuary 
     under paragraph (5), the plan is not in declining status for 
     the plan year and, as of the beginning of the plan year--
       ``(i) the plan's funded percentage is less than 65 percent,
       ``(ii) the plan has an accumulated funding deficiency for 
     the plan year, or is projected to have such an accumulated 
     funding deficiency for any of the 6 succeeding plan years, 
     taking into account any extension of amortization periods 
     under section 431(d), or
       ``(iii) the plan's projected funded percentage as of the 
     first day of the 15th succeeding plan year is less than 80 
     percent.
       ``(B) Original plans.--Notwithstanding subparagraph (A), a 
     multiemployer plan which is an original plan pursuant to 
     section 4233A(d)(3) of the Employee Retirement Income 
     Security Act of 1974 shall be treated as being in critical 
     status for the period of 15 consecutive plan years beginning 
     with the

[[Page S7602]]

     plan year that includes the date of the partition under such 
     section 4233A.''.
       (d) Declining Status.--
       (1) In general.--
       (A) The following provisions of section 432 of the Internal 
     Revenue Code of 1986 are each amended by striking ``critical 
     and declining'' each place it appears and inserting 
     ``declining'':
       (i) Subsection (a)(4) (as redesignated by subsection 
     (a)(1)).
       (ii) Subparagraphs (A) and (B)(i) of subsection (b)(1), as 
     added by subsection (a)(3).
       (iii) Subsection (b)(4)(B)(v) (as redesignated by 
     subsection (a)(3)), and the heading thereof.
       (iv) Paragraph (1)(B), and the heading of such paragraph 
     (1)(B), of subsection (c), as added by subsection (a)(2).
       (v) The heading of paragraph (9) of subsection (f) (as 
     redesignated by subsection (a)(2)).
       (vi) Subparagraphs (A), (C), (G)(i), and (J) of subsection 
     (f)(9) (as so redesignated).
       (vii) Subsection (h)(1) (as so redesignated).
       (B) Section 418E(g) of such Code, as amended by section 112 
     and subsection (a), is further amended by striking ``critical 
     and declining status'' and inserting ``declining status''.
       (2) Determination of declining status.--
       (A) In general.--Subsection (b) of section 432 of such Code 
     is amended--
       (i) by striking paragraph (7), as redesignated by 
     subsection (a)(3),
       (ii) by redesignating paragraphs (4), (5), and (6), as so 
     redesignated, as paragraphs (5), (6), and (7), respectively, 
     and
       (iii) by inserting after paragraph (3), as so redesignated, 
     the following new paragraph:
       ``(4) Declining status.--A multiemployer plan is in 
     declining status for a plan year if--
       ``(A) as determined by the plan actuary under paragraph 
     (5), as of the beginning of the plan year the plan is 
     projected to become insolvent within the plan year or any of 
     the 29 succeeding plan years,
       ``(B) the plan is otherwise in critical status for the plan 
     year as determined by the plan actuary under paragraph (5), 
     and the plan sponsor determines that, based on reasonable 
     actuarial assumptions and upon exhaustion of all reasonable 
     measures, the plan cannot reasonably be expected to emerge 
     from critical status within the next 30 plan years, or
       ``(C) the plan has a funded percentage for the plan year 
     which is greater than the projected funded percentage as of 
     the first day of the 15th succeeding plan year, unless the 
     funded percentage for the plan year is 100 percent or greater 
     and the projected funded percentage as of the first day of 
     such 15th succeeding plan year is less than 100 percent.''.
       (B) Conforming amendments.--
       (i) Paragraph (1) of section 432(b) of such Code, as added 
     by subsection (a)(3), is amended--

       (I) by striking ``paragraph (4)'' each place it appears in 
     subparagraphs (A) and (B) and inserting ``paragraph (5)'', 
     and
       (II) by striking ``paragraph (6)'' each place it appears in 
     subparagraphs (A) and (B) and inserting ``paragraph (7)''.

       (ii) Subsection (c) of section 432 of such Code, as added 
     by subsection (a)(2), is amended by striking ``(b)(4)'' each 
     place it appears in paragraphs (1)(A)(i), (1)(A)(ii), 
     (1)(A)(iii), (2)(A), and (2)(B) and inserting ``(b)(5)''.
       (iii) Section 432(b)(5) of such Code, as further 
     redesignated by subparagraph (A) and as amended by section 
     321 and subsection (a), is further amended--

       (I) by striking ``paragraph (5)'' in subparagraph (B)(iv) 
     thereof and inserting ``paragraph (6)'',
       (II) by striking ``paragraph (5)'' each place it appears in 
     subparagraphs (D)(i) and (D)(vi) thereof and inserting 
     ``paragraph (6)'', and
       (III) by striking ``paragraph (6)'' in subparagraph (D)(iv) 
     thereof and inserting ``paragraph (7)''.

       (iv) Section 432(b)(6) of such Code, as so further 
     redesignated and amended, is further amended--

       (I) by striking ``paragraph (4)(B)(iv)'' and inserting 
     ``paragraph (5)(B)(iv)'',
       (II) by striking ``paragraph (4)'' in subparagraph (A) 
     thereof and inserting ``paragraph (5)'', and
       (III) by striking ``paragraph (4)(A)'' in subparagraph (A) 
     thereof and inserting ``paragraph (5)(A)''.

       (v) Section 432(b)(7)(A) of such Code, as so further 
     redesignated and amended, is further amended--

       (I) by striking ``paragraph (4)(A)'' and inserting 
     ``paragraph (5)(A)'', and
       (II) by striking ``either paragraph (2)(A) or paragraph 
     (2)(B)'' and inserting ``any subparagraph of paragraph (2)''.

       (vi) Section 432(b)(7)(B) of such Code, as so further 
     redesignated, is amended by striking ``critical or 
     endangered'' and inserting ``endangered, critical, or 
     declining''.
       (vii) Paragraphs (1)(A), (4)(A)(ii), (4)(C)(i), (4)(C)(ii), 
     (4)(D), and (8) of subsection (d), and subsections (f)(1)(A), 
     (f)(4)(B)(i), (f)(4)(B)(ii)(I), (f)(5), and (g)(3) of section 
     432 of such Code, as redesignated and amended by subsection 
     (a), are each further amended by striking ``subsection 
     (b)(4)(A)'' and inserting ``subsection (b)(5)(A)''.
       (viii) Section 432(d)(3)(A)(i)(I) of such Code, as so 
     redesignated and amended, is further amended by striking 
     ``subsection (b)(4)'' and inserting ``subsection (b)(5)''.
       (ix) Subsections (f)(8)(A)(ii) and (g)(2)(A) of section 432 
     of such Code, as so redesignated and amended, are each 
     further amended by striking ``subsection (b)(4)(D)'' and 
     inserting ``subsection (b)(5)(D)''.
       (x) Section 432(f)(9)(J) of such Code, as so redesignated 
     and amended, is further amended by striking ``subsection 
     (b)(4)'' and inserting ``subsection (b)(5)''.
       (3) Solvency plan.--
       (A) In general.--Paragraph (4) (as redesignated by 
     subsection (a)(1) and amended by paragraph (1)) of section 
     432(a) of such Code is amended--
       (i) by redesignating subparagraph (B) as subparagraph (D), 
     and
       (ii) by striking subparagraph (A) and inserting before 
     subparagraph (D) (as so redesignated) the following new 
     subparagraphs:
       ``(A) the plan sponsor shall adopt and implement a solvency 
     plan in accordance with the requirements of subsection (h),
       ``(B) any rehabilitation plan in place as of the date the 
     plan enters declining status shall continue to apply 
     throughout the solvency plan adoption period,
       ``(C) the requirements of subsection (i) and paragraphs (6) 
     and (7) of subsection (f) shall apply during the solvency 
     plan adoption period and the solvency attainment period, 
     and''.
       (B) Adoption of plan.--Section 432 of such Code, as amended 
     by this section, is further amended--
       (i) by redesignating subsection (l), as added by title V of 
     this Act, as subsection (n), and by further redesignating 
     subsections (h), (i), (j), and (k), as redesignated by 
     subsection (a)(2), as subsections (j), (k), (l), and (m), 
     respectively, and
       (ii) by inserting after subsection (g), as redesignated by 
     subsection (a)(2), the following new subsections:
       ``(h) Solvency Plan Must Be Adopted for Multiemployer Plans 
     in Declining Status.--
       ``(1) In general.--In any case in which a multiemployer 
     plan is in declining status for a plan year, the plan 
     sponsor, in accordance with this subsection--
       ``(A) shall adopt a solvency plan not later than 240 days 
     following the required date for the actuarial certification 
     of declining status under subsection (b)(5)(A), and
       ``(B) within 30 days after the adoption of the solvency 
     plan shall provide to the bargaining parties 1 or more 
     schedules showing revised benefit structures, revised 
     contribution structures, or both, which, if adopted, may 
     reasonably be expected to enable the multiemployer plan to 
     meet the requirements of paragraph (3), including--
       ``(i) one default proposal under which--

       ``(I) all adjustable benefits in the form of early 
     retirement subsidies (including early reduction factors which 
     are not provided on an actuarially equivalent basis) under 
     the plan are eliminated, and
       ``(II) the future monthly benefit accrual rate under the 
     plan is reduced to the equivalent of 1 percent of annual 
     contributions (or, if lower, the current accrual rate) based 
     on the contribution rate in effect as of the later of the 
     first day of the plan year in which the plan enters declining 
     status or the date of a partition under section 4233A of the 
     Employee Retirement Income Security Act of 1974, and

     which may also include reduction or elimination of any other 
     adjustable benefits under the plan, and
       ``(ii) any additional schedules which reduce or eliminate 
     adjustable benefits under the plan which the plan sponsor 
     deems appropriate to provide as an alternative to the default 
     proposal.
     No schedule provided to or adopted by the bargaining parties 
     shall provide for a monthly benefit accrual rate in excess of 
     the rate described in subparagraph (B)(i)(II).
       ``(2) Exception for years after process begins.--Paragraph 
     (1) shall not apply to a plan year if such year is in a 
     solvency plan adoption period or solvency attainment period 
     by reason of the plan being in declining status for a 
     preceding plan year, except that the next update of the 
     solvency plan shall fulfill the requirement of paragraph 
     (1)(B)(i). For purposes of this section, such preceding plan 
     year shall be the initial determination year with respect to 
     the solvency plan to which it relates.
       ``(3) Solvency plan.--For purposes of this section, a 
     solvency plan is a plan which consists of the actions, 
     including options or a range of options to be proposed to the 
     bargaining parties, formulated, based on reasonably 
     anticipated experience and reasonable actuarial assumptions, 
     to enable the plan to delay or avoid the projected 
     insolvency.
       ``(4) Solvency attainment period.--For purposes of this 
     section--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the solvency attainment period for any solvency plan adopted 
     pursuant to this subsection is the period--
       ``(i) beginning on the first day of the first plan year of 
     the multiemployer plan beginning after the earlier of--

       ``(I) the second anniversary of the date of the adoption of 
     the solvency plan, or
       ``(II) the expiration of the collective bargaining 
     agreements in effect on the due date for the actuarial 
     certification of declining status for the initial 
     determination year under subsection (b)(5)(A) and covering, 
     as of such due date, at least 75 percent of the active 
     participants in such plan, and

       ``(ii) ending on the date the plan either emerges from 
     declining status or becomes insolvent.
       ``(B) Coordination with changes in status.--

[[Page S7603]]

       ``(i) Plans no longer in declining status.--If the plan's 
     actuary certifies in accordance with subparagraph (C) for a 
     plan year in any solvency plan adoption period or solvency 
     attainment period that the plan is no longer in declining 
     status, the solvency plan adoption period or solvency 
     attainment period, whichever is applicable, shall end as of 
     the date of such certification.
       ``(ii) Plans in critical or endangered status.--If the 
     plan's actuary certifies under subsection (b)(5)(A) for the 
     plan year described in clause (i) that the plan is in 
     critical or endangered rather than declining status, the 
     provisions of subsections (d) and (e), or subsections (f) and 
     (g), whichever are applicable, shall be applied as if such 
     plan year were an initial determination year, except that the 
     plan may not be amended in a manner inconsistent with the 
     solvency plan in effect for the preceding plan year until a 
     new funding improvement plan or rehabilitation plan, 
     whichever is applicable, is adopted.
       ``(C) Emergence.--A plan in declining status shall remain 
     in such status until a plan year for which the plan actuary 
     certifies, in accordance with subsection (b)(5)(A), that the 
     plan is not described in one or more of the subparagraphs in 
     subsection (b)(4) as of the beginning of the plan year.
       ``(5) Updates to solvency plans and schedules.--
       ``(A) Solvency plan.--The plan sponsor shall annually 
     update the solvency plan and shall file the update with the 
     plan's annual report under section 104 of the Employee 
     Retirement Income Security Act of 1974.
       ``(B) Schedules.--The plan sponsor shall annually update 
     any schedule of contribution rates provided under this 
     subsection to reflect the experience of the plan.
       ``(C) Duration of schedule.--A schedule of contribution 
     rates provided by the plan sponsor and relied upon by 
     bargaining parties in negotiating a collective bargaining 
     agreement shall remain in effect for the duration of that 
     collective bargaining agreement.
       ``(6) Imposition of schedule where failure to adopt 
     solvency plan.--
       ``(A) Initial contribution schedule.--If--
       ``(i) a collective bargaining agreement providing for 
     contributions under a multiemployer plan that was in effect 
     at the time the plan entered declining status expires, and
       ``(ii) after receiving one or more schedules from the plan 
     sponsor under paragraph (1)(B), the bargaining parties with 
     respect to such agreement fail to adopt a contribution 
     schedule with terms consistent with the solvency plan and a 
     schedule from the plan sponsor,
     the plan sponsor shall implement the schedule described in 
     paragraph (1)(B)(i) beginning on the date specified in 
     subparagraph (C).
       ``(B) Subsequent contribution schedule.--If--
       ``(i) a collective bargaining agreement providing for 
     contributions under a multiemployer plan in accordance with a 
     schedule provided by the plan sponsor pursuant to a solvency 
     plan (or imposed under subparagraph (A)) expires while the 
     plan is still in declining status, and
       ``(ii) after receiving one or more updated schedules from 
     the plan sponsor under paragraph (5)(B), the bargaining 
     parties with respect to such agreement fail to adopt a 
     contribution schedule with terms consistent with the updated 
     solvency plan and a schedule from the plan sponsor,
     then the contribution schedule applicable under the expired 
     collective bargaining agreement, as updated and in effect on 
     the date the collective bargaining agreement expires, shall 
     be implemented by the plan sponsor beginning on the date 
     specified in subparagraph (C).
       ``(C) Date of implementation.--The date specified in this 
     subparagraph is the date which is 180 days after the date on 
     which the collective bargaining agreement described in 
     subparagraph (A) or (B) expires.
       ``(7) Solvency plan adoption period.--For purposes of this 
     section, the term `solvency plan adoption period' means the 
     period beginning on the date of the certification under 
     subsection (b)(5)(A) for the initial determination year and 
     ending on the day before the first day of the solvency 
     attainment period.
       ``(i) Rules for Operation of Plan During Adoption and 
     Attainment Periods.--
       ``(1) Compliance with solvency plan.--
       ``(A) In general.--A plan may not be amended after the date 
     of the adoption of a solvency plan under subsection (h) so as 
     to be inconsistent with the solvency plan.
       ``(B) Special rules for benefit increases.--A plan may not 
     be amended after the date of the adoption of a solvency plan 
     under subsection (h) so as to increase benefits, including 
     future benefit accruals, unless the increase is required by 
     law or is a de minimis change.
       ``(C) Special rules for increases in compensation or 
     contribution rate.--Any increase in employee compensation or 
     contribution rates which takes effect after the first day of 
     the plan year in which the plan enters declining status shall 
     not give rise to an increase in benefits or future benefit 
     accruals under the plan.
       ``(2) Restriction on lump sums and similar benefits.--
       ``(A) In general.--Effective on the date the notice of 
     certification of the plan's declining status for the initial 
     determination year under subsection (b)(5)(D) is sent, and 
     notwithstanding section 411(d)(6), the plan shall not pay--
       ``(i) any payment, in excess of the monthly amount paid 
     under a single life annuity (plus any social security 
     supplements described in the last sentence of section 
     411(a)(9)), to a participant or beneficiary whose annuity 
     starting date (as defined in section 417(f)(2)) occurs after 
     the date such notice is sent,
       ``(ii) any payment for the purchase of an irrevocable 
     commitment from an insurer to pay benefits, or
       ``(iii) any other payment specified by the Secretary by 
     regulations,
     unless it is a de minimis amount.
       ``(B) Exception.--Subparagraph (A) shall not apply to a 
     benefit which under section 411(a)(11) may be immediately 
     distributed without the consent of the participant or to any 
     makeup payment in the case of a retroactive annuity starting 
     date or any similar payment of benefits owed with respect to 
     a prior period.
       ``(3) Special rules for plan adoption period.--During the 
     period beginning on the date of the certification under 
     subsection (b)(5)(A) for the initial determination year and 
     ending on the date of the adoption of a solvency plan--
       ``(A) the plan sponsor may not accept a collective 
     bargaining agreement or participation agreement with respect 
     to the multiemployer plan that provides for--
       ``(i) a reduction in the level of contributions for any 
     participants,
       ``(ii) a suspension of contributions with respect to any 
     period of service, or
       ``(iii) any new direct or indirect exclusion of younger or 
     newly hired employees from plan participation,
     unless the plan sponsor reasonably determines that the 
     acceptance of such an agreement is in the best interests of 
     participants and beneficiaries and that rejection of such 
     agreement would adversely affect the plan, and
       ``(B) no amendment of the plan which increases the 
     liabilities of the plan by reason of any increase in 
     benefits, any change in the accrual of benefits, or any 
     change in the rate at which benefits become nonforfeitable 
     under the plan may be adopted unless the amendment is 
     required as a condition of qualification under part I of 
     subchapter D of chapter 1 or to comply with other applicable 
     law.''.
       (C) Suspension of benefits.--Section 432 of such Code, as 
     amended by this section, is further amended--
       (i) by redesignating paragraph (9) of subsection (f) (as 
     redesignated by subsection (a)(2)) as paragraph (8) of 
     subsection (h) (as added by subparagraph (B)), and
       (ii) by moving such paragraph to the position immediately 
     after paragraph (7) of such subsection (h).
       (4) Conforming amendments.--
       (A) Subsection (a)(4)(D) of section 432 of such Code, as 
     redesignated and amended by the preceding provisions of this 
     section, is further amended by striking ``subsection (f)(9)'' 
     and inserting ``subsection (h)(8)''.
       (B) Paragraph (5) of section 432(b) of such Code, as so 
     redesignated and as amended by section 321 and the preceding 
     provisions of this section, is further amended--
       (i) by striking ``critical'' in subparagraph (A)(i)(I) and 
     inserting ``critical or declining'',
       (ii) by striking ``funding improvement or rehabilitation 
     period'' in subparagraph (A)(i)(II) and inserting ``funding 
     improvement, rehabilitation, or solvency attainment period'',
       (iii) by striking ``funding improvement or rehabilitation 
     plan'' in subparagraph (A)(i)(II) and inserting ``funding 
     improvement, rehabilitation, or solvency plan'',
       (iv) by striking ``endangered or critical'' in subparagraph 
     (A)(i)(V)(bb) and inserting ``endangered, critical, or 
     declining'',
       (v) by striking ``funding improvement plan or 
     rehabilitation'' in subparagraph (A)(iv) and inserting 
     ``funding improvement, rehabilitation, or solvency'',
       (vi) by striking ``critical'' each place it appears in 
     subparagraph (A)(vi) and inserting ``critical or declining'',
       (vii) by striking ``rehabilitation period'' in subparagraph 
     (A)(vi) and inserting ``rehabilitation or solvency attainment 
     period'',
       (viii) by striking ``as described in subsection (f)(9)'' in 
     subparagraph (B)(v),
       (ix) by inserting ``if the plan is already in a 
     rehabilitation period, and'' before ``if reasonable'' in 
     subparagraph (B)(v)(I),
       (x) by striking ``subsection (f)(9)'' in subparagraph 
     (B)(v)(II) and inserting ``subsection (h)(8)'',
       (xi) by striking ``endangered or critical'' both places it 
     appears in subparagraph (D)(i) and inserting ``endangered, 
     critical, or declining'',
       (xii) by striking ``endangered or critical'' in the heading 
     of subparagraph (D)(ii) and inserting ``endangered, critical, 
     or declining'',
       (xiii) by striking ``endangered or critical'' in 
     subparagraph (D)(ii) and inserting ``endangered, critical, or 
     declining'',
       (xiv) by striking ``funding improvement or rehabilitation 
     plan'' both places it appears in subclauses (I) and (II) of 
     subparagraph (D)(ii) and inserting ``funding improvement, 
     rehabilitation, or solvency plan'', and
       (xv) by adding at the end of subparagraph (D) the following 
     new clause:
       ``(vii) Notice of projection to be in declining status in a 
     future plan year.--In any case in which it is certified under 
     subparagraph (A)(i) that a multiemployer plan will be in 
     declining status for any of 5 succeeding plan years (but not 
     for the current plan year), the plan sponsor shall, not later

[[Page S7604]]

     than 30 days after the date of the certification, provide 
     notification of the projected declining status to the Pension 
     Benefit Guaranty Corporation.''.
       (C) Subparagraph (J) of section 432(h)(8) of such Code, as 
     so redesignated and amended, is further amended--
       (i) by striking ``critical'' in the heading and inserting 
     ``declining'', and
       (ii) by striking ``shall not emerge from critical status 
     under paragraph (4)(B),'' and inserting ``shall not emerge 
     from declining status''.
       (D) Subsection (j) of section 432 of such Code, as so 
     redesignated and amended, is further amended--
       (i) by striking ``(f)(8) or (g)'' in paragraph (1) and 
     inserting ``(f)(8), (g), or (i)'',
       (ii) by striking ``subsection (f)(9)'' in paragraph (1) and 
     inserting ``subsection (h)(8)'',
       (iii) by striking ``funding improvement or rehabilitation 
     plan'' in the heading of paragraph (3) and inserting 
     ``funding improvement, rehabilitation, or solvency'',
       (iv) by striking ``funding improvement plan or 
     rehabilitation plan'' both places it appears in subparagraphs 
     (A) and (B) of paragraph (3) and inserting ``funding 
     improvement, rehabilitation, or solvency plan'',
       (v) by striking ``endangered or critical'' in the heading 
     of paragraph (4), as amended by subsection (a), and inserting 
     ``endangered, critical, or declining'',
       (vi) by striking ``endangered or critical'' each place it 
     appears in paragraph (4), as so amended, and inserting 
     ``endangered, critical, or declining'', and
       (vii) by striking ``critical or endangered'' in paragraph 
     (4) and inserting ``endangered, critical, or declining''.
       (E) Subsection (k) of section 432 of such Code, as so 
     redesignated and amended, is further amended--
       (i) by striking ``or a rehabilitation plan under subsection 
     (f)'' and inserting ``, a rehabilitation plan under 
     subsection (f), or a solvency plan under subsection (h)'',
       (ii) by striking ``endangered status or a plan in critical 
     status'' and inserting ``endangered, critical, or declining 
     status'',
       (iii) by striking ``has not agreed on a funding improvement 
     plan or rehabilitation plan'' and inserting ``has not agreed 
     on a funding improvement, rehabilitation, or solvency plan 
     (whichever is applicable)'', and
       (iv) by striking ``adoption of a funding improvement plan 
     or rehabilitation plan'' and inserting ``adoption of a 
     funding improvement, rehabilitation, or solvency plan''.
       (F) Subsection (l) of section 432 of such Code, as so 
     redesignated and amended, is further amended--
       (i) by striking ``endangered status or in critical status'' 
     in paragraph (1) and inserting ``endangered, critical, or 
     declining status'',
       (ii) by striking ``endangered or critical'' in paragraph 
     (1) and inserting ``endangered, critical, or declining'', and
       (iii) by striking ``(d) and (f)'' in paragraph (2) and 
     inserting ``(d), (f), and (h)''.
       (G) Section 418E of such Code, as amended by section 112 
     and this section, is further amended--
       (i) by striking ``432(b)(3)'' each place it appears in 
     subsections (c)(1), (c)(2), (d)(1), and (d)(2) and inserting 
     ``432(b)(3), or a plan in declining status, as described in 
     section 432(b)(4)'', and
       (ii) by striking ``432(f)(9)'' in subsection (g) and 
     inserting ``432(h)(8)''.
       (H) Section 4971(g) of such Code, as amended by this 
     section, is further amended--
       (i) by striking ``Endangered or Critical'' in the heading 
     and inserting ``Endangered, Critical, or Declining'',
       (ii) by striking ``critical status'' in paragraph (1)(A) 
     and inserting ``critical or declining status'',
       (iii) by striking ``or rehabilitation plan'' in the heading 
     of paragraph (2) and inserting ``, rehabilitation, or 
     solvency plan'',
       (iv) by striking ``plan or rehabilitation plan'' in 
     paragraph (2)(A) and inserting ``, rehabilitation, or 
     solvency plan'',
       (v) by striking ``rehabilitation plan'' in paragraph (2)(C) 
     and inserting ``funding improvement, rehabilitation, or 
     solvency plan'',
       (vi) by striking paragraph (3) and redesignating paragraphs 
     (4), (5), and (6) as paragraphs (3), (4), and (5), 
     respectively,
       (vii) by striking ``rehabilitation plan'' in the heading of 
     paragraph (3), as so redesignated, and inserting 
     ``rehabilitation or solvency plan'',
       (viii) by striking ``critical status'' in paragraph (3)(A), 
     as so redesignated, and inserting ``critical or declining 
     status'',
       (ix) by striking ``rehabilitation plan'' in paragraph 
     (3)(A), as so redesignated, and inserting ``rehabilitation or 
     solvency plan'',
       (x) by striking ``described in section 432(f)(1)(A) and 
     ending on the day on which the rehabilitation plan is 
     adopted'' in paragraph (3)(B)(ii), as so redesignated, and 
     inserting ``described in section 432(f)(1)(A) or 
     432(h)(1)(A), whichever is applicable, and ending on the day 
     on which the rehabilitation plan or solvency plan is 
     adopted'',
       (xi) by striking ``432(k)(9)'' in paragraph (3)(C)(ii), as 
     so redesignated, and inserting ``432(n)(9)'', and
       (xii) by striking ``or (3)'' in paragraph (4), as so 
     redesignated.
       (e) Adjustment of Benefits.--
       (1) In general.--Section 432 of the Internal Revenue Code 
     of 1986, as amended by this section, is further amended--
       (A) by further redesignating subsections (m) and (n), as 
     redesignated by subsection (d), as subsections (n) and (o), 
     respectively,
       (B) by redesignating paragraph (8) of subsection (f), as 
     redesignated by subsection (a)(2), as subsection (m), and
       (C) by moving such subsection to the position immediately 
     after subsection (l).
       (2) Clerical and conforming amendments.--
       (A) The heading of subsection (m) of section 432 of such 
     Code, as redesignated by paragraph (1), is amended to read as 
     follows:
       ``(m) Adjustment of Benefits.--''.
       (B) The following provisions of such subsection (m) are 
     amended as follows:
       (i) Subparagraphs (A), (B), and (C) are redesignated as 
     paragraphs (1), (2), and (4), respectively, and moved 2 ems 
     to the left.
       (ii) Clauses (i), (ii), (iii), and (iv) of paragraph (1) 
     (as so redesignated) are redesignated as subparagraphs (A), 
     (B), (C), and (D), respectively, and moved 2 ems to the left.
       (iii) Subclauses (I), (II), and (III) of paragraph (1)(D) 
     (as so redesignated) are redesignated as clauses (i), (ii), 
     and (iii), respectively, and moved 2 ems to the left.
       (iv) Clauses (i), (ii), and (iii) of paragraph (4) (as so 
     redesignated) are redesignated as subparagraphs (A), (B), and 
     (C), respectively, and moved 2 ems to the left, and the flush 
     sentence at the end of subparagraph (C) (as so redesignated) 
     is moved 2 ems to the left.
       (v) Subclauses (I), (II), and (III) of paragraph (4)(A) (as 
     so redesignated) are redesignated as clauses (i), (ii), and 
     (iii), respectively, and moved 2 ems to the left.
       (vi) Subclauses (I) and (II) of paragraph (4)(B) (as so 
     redesignated) are redesignated as clauses (i) and (ii), 
     respectively, and moved 2 ems to the left.
       (vii) Subclauses (I), (II), and (III) of paragraph (4)(C) 
     (as so redesignated) are redesignated as clauses (i), (ii), 
     and (iii), respectively, and moved 2 ems to the left.
       (viii) Paragraph (1)(A), as so redesignated, is amended by 
     striking ``subparagraph (C)'' and inserting ``paragraph 
     (4)''.
       (ix) Paragraph (1)(B), as so redesignated, is amended by 
     striking ``clause (iv)(III)'' and inserting ``subparagraph 
     (D)(iii)''.
       (x) Paragraph (1)(D), as so redesignated, is amended by 
     striking ``this paragraph'' and inserting ``this 
     subsection''.
       (xi) Paragraph (2), as so redesignated, is amended--

       (I) by striking ``subparagraph (A)(iv)(III)'' and inserting 
     ``paragraph (1)(D)(iii)'', and
       (II) by striking ``this paragraph'' and inserting ``this 
     subsection''.

       (xii) Paragraph (4)(A), as so redesignated, is amended by 
     striking ``subparagraph (A)'' and inserting ``paragraph 
     (1)''.
       (xiii) Paragraphs (4)(B) and (4)(C), as so redesignated, 
     are each amended by striking ``clause (i)'' each place it 
     appears and inserting ``subparagraph (A)''.
       (xiv) The last sentence of paragraph (4)(C), as so 
     redesignated, is amended--

       (I) by striking ``subclause (I)'' and inserting ``clause 
     (i)'', and
       (II) by striking ``this subparagraph'' and inserting ``this 
     paragraph''.

       (3) Application to all plans in endangered, critical, or 
     declining status.--
       (A) In general.--Subparagraph (A) of section 432(m)(1) of 
     such Code, as redesignated and amended by this section, is 
     further amended--
       (i) by striking ``the plan sponsor shall'' and inserting 
     ``the plan sponsor of a multiemployer plan in endangered, 
     critical, or declining status may'', and
       (ii) by striking ``paragraph (1)(B)(i)'' and inserting 
     ``subsection (d)(1)(B), (f)(1)(B), or (h)(1)(B), whichever is 
     applicable''.
       (B) Conforming amendment.--Subparagraph (B) of section 
     432(m)(1) of such Code, as redesignated and amended by this 
     section, is further amended by striking ``critical'' both 
     places it appears and inserting ``endangered, critical, or 
     declining''.
       (4) Additional adjustable benefits.--
       (A) In general.--Subparagraph (D) of section 432(m)(1) of 
     such Code, as redesignated by this section, is amended--
       (i) by inserting ``, including early reduction factors 
     which are not provided on an actuarially equivalent basis,'' 
     after ``(i))'' in clause (ii), as so redesignated,
       (ii) by striking ``and'' at the end of clause (ii) (as so 
     redesignated),
       (iii) by striking ``that would not be eligible'' and all 
     that follows through the period in clause (iii) (as so 
     redesignated) and inserting ``which were adopted (or, if 
     later, took effect) less than 120 months before the first day 
     of the first plan year in which the plan was in endangered, 
     critical, or declining status,'', and
       (iv) by adding at the end the following new clauses:
       ``(iv) any one-time bonus payment or `thirteenth check' 
     provision, and
       ``(v) benefits granted for periods of service prior to 
     participation in the plan.''.
       (B) Conforming amendments.--
       (i) Subparagraph (B) of section 432(m)(1) of such Code, as 
     redesignated and amended by this section, is further amended 
     by striking ``subparagraph (D)(iii)'' and inserting ``clause 
     (iii), (iv), or (v) of subparagraph (D)''.
       (ii) Paragraph (2) of section 432(m) of such Code, as 
     amended by paragraph (2)(B), is further amended by striking 
     ``paragraph (1)(D)(iii)'' and inserting ``clause (iii), (iv), 
     or (v) of paragraph (1)(D)''.
       (5) Rules relating to suspension of benefits upon return to 
     work.--Subsection (m) of section 432 of such Code, as 
     redesignated and amended by this section, is further

[[Page S7605]]

     amended by inserting after paragraph (2) the following new 
     paragraph:
       ``(3) Rules relating to suspension of benefits upon return 
     to work.--The plan sponsor of a multiemployer plan in 
     endangered, critical, or declining status may amend rules 
     regarding the suspension of a participant's benefits upon a 
     return to work after commencement of benefits, or the 
     commencement of benefits after normal retirement age 
     (including in the case of continued employment after normal 
     retirement age). Any such changes shall apply only to future 
     payments of benefits.''.
       (6) Additional conforming amendments.--
       (A) Clause (iii) of section 432(b)(5)(D) of such Code, as 
     redesignated and amended by this section, is further 
     amended--
       (i) by striking ``critical'' in the heading and inserting 
     ``endangered, critical, or declining'',
       (ii) by striking ``critical status'' both places it appears 
     and inserting ``endangered, critical, or declining status'', 
     and
       (iii) by striking ``subsection (f)(8)'' in subclause (I) 
     and inserting ``subsection (m)(1)(D)''.
       (B) Subsection (j) of section 432 of such Code, as amended 
     by subsection (d), is further amended by striking ``(f)(8), 
     (g), or (i)'' and inserting ``(e), (g), (i), or (m)''.
       (f) Elections to Be in Critical or Endangered Status.--
       (1) In general.--Paragraph (6) of section 432(b) of the 
     Internal Revenue Code of 1986, as redesignated and amended by 
     this section, is further amended--
       (A) by striking ``is not in critical status'' in 
     subparagraph (A) and inserting ``is not in critical or 
     declining status'',
       (B) by striking ``but that is projected'' in subparagraph 
     (A) and inserting ``but--
       ``(i) that is projected'',
       (C) by striking ``5 plan years may, not later than'' in 
     subparagraph (A) and inserting ``5 plan years, or
       ``(ii) that is in endangered status and is not reasonably 
     projected to be able to emerge from endangered status within 
     the funding improvement period under the funding improvement 
     plan in effect,
     may, not later than'', and
       (D) by striking ``under paragraph (3)'' in subparagraph (B) 
     and inserting ``under paragraph (3) or for endangered status 
     under paragraph (2)''.
       (2) Election to be in endangered status.--Subsection (b) of 
     section 432 of such Code, as so redesignated and amended, is 
     further amended by adding at the end the following new 
     paragraph:
       ``(8) Election to be in endangered status.--Notwithstanding 
     paragraph (2)--
       ``(A) the plan sponsor of a multiemployer plan that is not 
     in endangered, critical, or declining status for a plan year 
     but that is projected by the plan actuary, pursuant to the 
     determination under paragraph (5), to be in endangered status 
     in any of the 5 succeeding plan years, may, not later than 30 
     days after the date of the certification under paragraph 
     (5)(A), elect to be in endangered status effective for the 
     current plan year,
       ``(B) the plan year in which the plan sponsor elects to be 
     in endangered status under subparagraph (A) shall be treated 
     for purposes of this section as the first year in which the 
     plan is in endangered status, regardless of the date on which 
     the plan first satisfies the criteria for endangered status 
     under paragraph (2), and
       ``(C) a plan that is in endangered status under this 
     paragraph shall not emerge from endangered status unless the 
     plan's actuary certifies under paragraph (5)(A) that the plan 
     is no longer in endangered status and is not in critical or 
     declining status.''.
       (g) Amendments Relating to Funding Improvement Plan.--
       (1) In general.--Paragraph (1) of section 432(d) of the 
     Internal Revenue Code of 1986, as redesignated and amended by 
     this section, is further amended--
       (A) by striking the last sentence, and
       (B) in subparagraph (B), by striking ``funding improvement 
     plan--'' and all that follows and inserting ``funding 
     improvement plan, shall provide to the bargaining parties 1 
     or more schedules showing revised benefit structures, revised 
     contribution structures, or both, which, if adopted, may 
     reasonably be expected to enable the multiemployer plan to 
     meet the requirements of paragraph (3), including--
       ``(i) one default proposal under which--

       ``(I) all adjustable benefits in the form of early 
     retirement subsidies (including early reduction factors which 
     are not provided on an actuarially equivalent basis) under 
     the plan are eliminated, and
       ``(II) the future monthly benefit accrual rate under the 
     plan is reduced to the equivalent of 1 percent of annual 
     contributions (or, if lower, the accrual rate as of the date 
     of the enactment of the Chris Allen Multiemployer Pension 
     Recapitalization and Reform Act of 2020) based on the 
     contribution rate in effect as of the first day of the plan 
     year in which the plan enters endangered status, and

     which may also include reduction or elimination of any other 
     adjustable benefits under the plan, and
       ``(ii) any additional schedules which reduce or eliminate 
     adjustable benefits under the plan which the plan sponsor 
     deems appropriate to provide as an alternative to the default 
     proposal.''.
       (2) Funding improvement plan.--Paragraph (3) of section 
     432(d) of such Code, as so redesignated and amended, is 
     further amended--
       (A) by striking ``For purposes of this section--'' and all 
     that follows through ``which consists of'' in subparagraph 
     (A) and inserting ``For purposes of this section, a funding 
     improvement plan is a plan which consists of'', and
       (B) by striking ``formulated to provide'' and all that 
     follows and inserting ``formulated, based on reasonably 
     anticipated experience and reasonable actuarial assumptions, 
     to--
       ``(A) enable the plan to no longer be in endangered status 
     (as certified by the plan actuary) by the end of the funding 
     improvement period, and
       ``(B) avoid any accumulated funding deficiencies during the 
     funding improvement period (taking into account any extension 
     of amortization periods under section 431(d)).''.
       (3) Funding improvement period.--Paragraph (4) of section 
     432(d) of such Code, as so redesignated and amended, is 
     further amended by striking subparagraph (B) and inserting 
     after subparagraph (A) the following new subparagraph:
       ``(B) New period based on adverse experience.--
       ``(i) In general.--If the plan's actuary determines 
     necessary based on adverse plan experience, the plan sponsor 
     may provide for a new 10-year period as of the first day of 
     any plan year in the original funding improvement period, but 
     only if the plan is still projected to meet the requirements 
     of the funding improvement plan and emerge from endangered 
     status at the end of the new funding improvement period.
       ``(ii) Limitation.--A plan sponsor may provide a new 10-
     year period under clause (i) not more than 1 time in any 20-
     consecutive-year period, unless the plan sponsor submits to 
     the Secretary an application for an additional new period. 
     Such application shall include a certification that the plan 
     is projected to emerge from endangered status in the proposed 
     new 10-year period and a description of key assumptions, to 
     be specified in regulations promulgated by the Secretary in 
     consultation with the Pension Benefit Guaranty 
     Corporation.''.
       (4) Conforming amendments.--
       (A) Subparagraph (C) of section 432(d)(4) of such Code, as 
     so redesignated and amended, is further amended--
       (i) by striking ``critical status'' both places it appears 
     in clauses (i) and (ii) and inserting ``critical or declining 
     status'',
       (ii) by striking ``rehabilitation period'' in clause (ii) 
     and inserting ``rehabilitation or solvency attainment 
     period'', and
       (iii) by striking ``critical status'' in the heading of 
     clause (ii) and inserting ``critical or declining status''.
       (B) Subsection (d) of section 432 of such Code, as so 
     redesignated and amended, is further amended by striking 
     paragraph (5) and by redesignating paragraphs (6), (7), and 
     (8) as paragraphs (5), (6), and (7), respectively.
       (C) Paragraph (6) of section 432(d) of such Code, as so 
     redesignated, is amended--
       (i) by striking ``(1)(B)(i)(I)'' in subparagraph (A) and 
     inserting ``(1)(B)(i)'', and
       (ii) by striking ``paragraph (6)(B)'' in subparagraph 
     (B)(ii) and inserting ``paragraph (5)(B)''.
       (D) Paragraph (2) of section 432(d) of such Code, as so 
     redesignated, is amended by inserting ``, except that the 
     next update of the funding improvement plan shall fulfill the 
     requirement of paragraph (1)(B)(i)'' after ``for a preceding 
     plan year''.
       (h) Amendments Relating to Rehabilitation Plan.--
       (1) In general.--Paragraph (1) of section 432(f) of the 
     Internal Revenue Code of 1986, as redesignated and amended by 
     this section, is further amended--
       (A) by striking the last 2 sentences, and
       (B) in subparagraph (B), by striking ``rehabilitation 
     plan--'' and all that follows and inserting ``rehabilitation 
     plan, shall provide to the bargaining parties 1 or more 
     schedules showing revised benefit structures, revised 
     contribution structures, or both, which, if adopted, may 
     reasonably be expected to enable the multiemployer plan to 
     meet the requirements of paragraph (3), including--
       ``(i) one default proposal under which--

       ``(I) all adjustable benefits in the form of early 
     retirement subsidies (including early reduction factors which 
     are not provided on an actuarially equivalent basis) under 
     the plan are eliminated, and
       ``(II) the future monthly benefit accrual rate under the 
     plan is reduced to the equivalent of 1 percent of annual 
     contributions (or, if lower, the accrual rate as of the date 
     of the enactment of the Chris Allen Multiemployer Pension 
     Recapitalization and Reform Act of 2020) based on the 
     contribution rate in effect as of the first day of the plan 
     year in which the plan enters critical status, and

     which may also include reduction or elimination of any other 
     adjustable benefits under the plan, and
       ``(ii) any additional schedules which reduce or eliminate 
     adjustable benefits under the plan which the plan sponsor 
     deems appropriate to provide as an alternative to the default 
     proposal.
     In the case of a plan adopting a rehabilitation plan 
     described in paragraph (3)(A)(ii), no schedule provided to or 
     adopted by the bargaining parties shall provide for a monthly 
     benefit accrual rate in excess of the rate described in 
     subparagraph (B)(i)(II).''.
       (2) Rehabilitation plan.--
       (A) In general.--Subparagraph (A) of section 432(f)(3) of 
     such Code, as so redesignated, is amended--

[[Page S7606]]

       (i) by striking ``and may include'' and all that follows 
     through ``such actions'' in clause (i),
       (ii) by inserting ``, while delaying insolvency for as long 
     as possible and maximizing the income of the plan, including 
     income after insolvency'' before the period in clause (ii), 
     and
       (iii) by striking ``(1)(B)(i)'' in the last sentence and 
     inserting ``(1)(B)''.
       (B) Conforming amendments.--Clause (i) of section 
     432(f)(3)(C) of such Code, as so redesignated, is amended--
       (i) by striking ``(1)(B)(i)'' in subclause (II) and 
     inserting ``(1)(B)'', and
       (ii) by striking ``the last sentence of paragraph (1)'' and 
     inserting ``paragraph (1)(B)(i)''.
       (3) Rehabilitation period.--
       (A) In general.--Subparagraph (A) of section 432(f)(4) of 
     such Code, as so redesignated and amended, is further 
     amended--
       (i) by striking ``The rehabilitation period'' and inserting 
     ``Except as otherwise provided in this subparagraph, the 
     rehabilitation period'', and
       (ii) by adding at the end the following: ``If, upon 
     exhaustion of all reasonable measures, the plan is not 
     reasonably expected to emerge from critical status by the end 
     of such 10-year period, the rehabilitation period shall be 
     extended to take into account the projected date of emergence 
     from critical status (if the rehabilitation plan remained in 
     effect until such date) or the projected date of insolvency 
     (if applicable) (unless the plan enters declining status).''.
       (B) Emergence from critical status.--Subparagraph (B) of 
     section 432(f)(4) of such Code, as so redesignated and 
     amended, is further amended--
       (i) by inserting ``and is not in declining status,'' after 
     the comma in clause (i)(I),
       (ii) by striking subclause (III) of clause (i) and 
     inserting the following:

       ``(III) the plan's projected funded percentage as of the 
     first day of the 15th succeeding plan year is at least 100 
     percent and is projected to increase after such date.'',

       (iii) by striking ``that--'' and all that follows through 
     ``regardless of whether'' in clause (ii)(I) and inserting 
     ``that the plan meets the requirements of subclauses (II) and 
     (III) of clause (i), regardless of whether'', and
       (iv) by striking ``unless--'' and all that follows in 
     clause (ii)(II) and inserting ``unless, as of such plan year, 
     the plan fails to meet the requirements of subclause (II) or 
     (III) of clause (i).''.
       (4) Rules relating to benefit increases during 
     rehabilitation period.--Subparagraph (B) of section 432(g)(1) 
     of such Code, as so redesignated and amended, is further 
     amended by striking ``unless'' and all that follows and 
     inserting ``unless the amendment is required as a condition 
     of qualification under part I of subchapter D of chapter 1 or 
     to comply with other applicable law, or the amendment 
     provides for only a de minimis increase in the liabilities of 
     the plan.''.
       (5) Conforming amendments.--
       (A) Paragraph (6) of section 432(f) of such Code, as so 
     redesignated, is amended by striking ``the last sentence of 
     paragraph (1)'' and inserting ``paragraph (1)(B)(i)''.
       (B) Paragraph (2) of section 432(f) of such Code, as so 
     redesignated, is amended by inserting ``, except that the 
     next update of the rehabilitation plan shall fulfill the 
     requirement of paragraph (1)(B)(i)'' after ``for a preceding 
     plan year''.
       (i) Actuarial Assumptions.--
       (1) In general.--Subsection (n) of section 432 of the 
     Internal Revenue Code of 1986, as redesignated by subsections 
     (a), (d), and (e), is amended--
       (A) by striking ``Method'' in the heading and inserting 
     ``Method and Assumptions'', and
       (B) by adding at the end the following new paragraph:
       ``(11) Actuarial assumptions.--
       ``(A) In general.--The actuarial assumptions relied upon 
     for purposes of this section by a plan actuary shall be 
     individually reasonable and, in the aggregate, shall be 
     reasonable and (with the exception of assumptions regarding 
     future contributions) represent the actuary's best estimate 
     of future plan experience, within limitations prescribed by 
     the Secretary. A plan actuary shall avoid conservatism or 
     optimism in individual assumptions to the extent that they 
     would result in a set of assumptions that is unreasonable in 
     the aggregate.
       ``(B) Investment returns.--The investment return assumption 
     for projecting plan assets may differ from the actuarial 
     valuation interest rate. In selecting the investment return 
     assumption for projecting plan assets, the plan actuary shall 
     estimate the expected return of the plan's investments as 
     currently invested and as expected to be invested in the 
     future, consistent with the plan's adopted investment policy, 
     if applicable. It is reasonable for an actuary to expect that 
     the plan's investment decisions will consider risk, expected 
     returns over time, and expected future benefit payments. The 
     investment return assumption shall not exceed the interest 
     rate used to determine past service liability under section 
     431(b)(6).
       ``(C) Contributions.--
       ``(i) In general.--The plan actuary shall develop 
     assumptions for the projection of future contributions, 
     including assumptions regarding industry activity among 
     contributing employers and contribution rates, based on 
     information provided by the plan sponsor, which must act 
     reasonably and in good faith. The plan actuary shall certify 
     the reasonableness of all assumptions.
       ``(ii) Projected industry activity.--Any projection of 
     activity in the industry or industries covered by the plan, 
     including future covered employment and contribution levels, 
     shall be based on information provided by the plan sponsor 
     acting reasonably and in good faith.
       ``(iii) Future contribution base units.--

       ``(I) Declining contribution base units.--If recent 
     experience of the plan has been declining contribution base 
     units, the plan actuary may assume future contribution base 
     units will continue to decline at the same annualized trend 
     as over the 5 immediately preceding plan years, unless the 
     actuary determines that there have been significant changes 
     that would make such assumption unreasonable.
       ``(II) Flat or increasing contribution base units.--If 
     recent experience of the plan has been increasing, or neither 
     increasing nor decreasing, contribution base units, the plan 
     actuary may assume future contribution base units will remain 
     unchanged indefinitely, unless the actuary determines that 
     there have been significant changes that would make such 
     assumption unreasonable.

       ``(iv) Future contribution rates.--

       ``(I) In general.--Projections of contributions shall be 
     based on the contribution rates consistent with the terms of 
     collective bargaining and participation agreements currently 
     in effect.
       ``(II) Future increases in accordance with correction 
     plans.--If reasonable and applicable, the plan actuary may 
     assume future increases in contribution rates consistent with 
     the adopted funding improvement plan, rehabilitation plan, or 
     solvency plan.
       ``(III) Additional factors.--Information provided by the 
     plan sponsor to the plan actuary in setting the assumption 
     regarding future increases in contribution rates shall take 
     into account the ability of the participating employers to 
     make contributions at the scheduled rates over time, 
     considering relevant factors such as projected industry 
     activity, the financial strength of participating employers, 
     market competition, and the scheduled contribution rate to 
     the plan relative to the overall wage package.

       ``(D) Assumptions for developing schedules.--All schedules 
     under any funding improvement plan, rehabilitation plan, or 
     solvency plan must be developed based on the same set of 
     actuarial assumptions unless it would be unreasonable to do 
     so, taking into account the anticipated impact of the 
     schedules on participant behavior and employer 
     participation.''.
       (2) Additions to form 5500 schedule mb.--Subparagraph (B) 
     of section 432(b)(5) of such Code, as redesignated and 
     amended by this section, is further amended by adding at the 
     end the following new clause:
       ``(vi) Additional attachments.--The plan actuary shall 
     attach to the certification required under subparagraph (A)--

       ``(I) documentation supporting the certification of status 
     under subparagraph (A), including projections of the funding 
     standard account, funded percentage, and solvency of the 
     plan,
       ``(II) a clear description of the key assumptions used in 
     performing the projections, including investment returns, 
     contribution base units, and contribution rates,
       ``(III) a 5-year history of contributions, including 
     contribution base units, average contribution rates, and 
     withdrawal liability payments, and a comparison of such 
     contribution base units, rates, and payments to projections 
     made by the plan, and
       ``(IV) an alternate projection of the funding standard 
     account, funded percentage, and solvency, based on the 
     following assumptions:

       ``(aa) Annual future investment returns on plan assets 
     equal the actuarial interest rate assumption minus 1 percent.
       ``(bb) Future contribution base units projected using a 
     trend equal to the lesser of--
       ``(AA) the annualized trend of actual contribution base 
     units over the 5 preceding plan years, and
       ``(BB) no change in future contribution base units.
       ``(cc) No increases in future contribution rates beyond 
     those consistent with the collective bargaining agreements 
     and participation agreements in effect for the plan year.
       ``(dd) The withdrawal from the plan of the employer which 
     has contributed the greatest total amount of contributions 
     over the 5 preceding plan years, if such employer has 
     contributed at least 10 percent of the total contributions to 
     the plan over such 5 plan years and such employer has a below 
     investment grade credit rating (but only if obtaining the 
     credit rating of such employer is not an undue burden).
       ``(ee) If such credit rating cannot be obtained without 
     undue burden, the withdrawal of the employer which has 
     contributed the greatest total amount of contributions over 
     the 5 preceding plan years, if such employer has contributed 
     at least 10 percent of the total contributions to the plan 
     over such 5 plan years without regard to collection of any 
     withdrawal liability.
       ``(ff) If no employer has contributed at least 10 percent 
     of the total contributions to the plan over the 5 preceding 
     plan years, the

[[Page S7607]]

     withdrawal of the employer which contributed the greatest 
     total amount of contributions for the current plan year, 
     without regard to collection of any withdrawal liability, 
     unless the employer contributed less than 1 percent of the 
     total contributions to the plan for such plan year.
       ``(gg) Other assumptions consistent with the projection 
     based on the actuary's best estimate assumptions.''.
       (3) Conforming amendments.--
       (A) Section 432(b)(5)(B)(i) of such Code, as redesignated 
     by this section, is amended by striking ``assumptions'' and 
     inserting ``assumptions meeting the requirements of 
     subsection (n)(11)''.
       (B) Section 432(b)(5)(A)(vi) of such Code, as amended by 
     this section and section 321, is further amended by striking 
     ``reasonable actuarial assumptions'' and inserting 
     ``assumptions meeting the requirements of subsection 
     (n)(11)''.
       (C) Paragraph (3) of section 432(d) of such Code, as 
     amended by subsection (g), is further amended by striking 
     ``reasonable actuarial assumptions'' and inserting 
     ``assumptions meeting the requirements of subsection 
     (n)(11)''.
       (D) Clause (i) of section 432(f)(3)(A) of such Code, as 
     amended by subsection (h), is further amended by striking 
     ``reasonable actuarial assumptions'' and inserting 
     ``assumptions meeting the requirements of subsection 
     (n)(11)''.
       (E) Section 432(h)(3) of such Code, as added by subsection 
     (d), is amended by striking ``reasonable actuarial 
     assumptions'' and inserting ``assumptions meeting the 
     requirements of subsection (n)(11)''.
       (j) Conforming Amendments Relating to Legacy Plans.--
       (1) Subsections (a)(3)(F), (b)(1)(B)(i), (b)(1)(H)(iv), and 
     (d)(6)(A) of section 411 of the Internal Revenue Code of 
     1986, as amended by title V, are each further amended by 
     striking ``432(f)'' each place it appears and inserting 
     ``432(h)(8)''.
       (2) Sections 431(b)(10), 440A(d)(2)(D), and 440A(d)(4) of 
     such Code, as added by title V, are each amended by striking 
     ``endangered or critical'' and inserting ``endangered, 
     critical, or declining''.
       (3) Section 437(b)(1) of such Act, as so added, is amended 
     by striking ``endangered or critical'' both places it appears 
     and inserting ``endangered, critical, or declining''.
       (4) Sections 437(b)(5)(B) and 440A(b)(1)(A) of such Code, 
     as so added, are each amended by striking ``endangered or 
     critical'' and inserting ``endangered, critical, or 
     declining''.
       (5) Sections 437(b)(1), 437(b)(5)(B), 440A(b)(1)(A), and 
     440A(e)(3) of such Code, as so added, are each amended by 
     striking ``432(b)(4)'' and inserting ``432(b)(5)''.
       (6) Sections 438(b)(5) and 440A(d)(2)(A) of such Code, as 
     so added, are each amended by striking ``432(b)(4)(B)'' and 
     inserting ``432(b)(5)(B)''.
       (7) Section 438(b)(1) of such Code, as so added, is amended 
     by striking ``and'' at the end of subparagraph (B), by 
     striking the period at the end of subparagraph (C) and 
     inserting ``, and'', and by adding at the end the following 
     new subparagraph:
       ``(D) consistent with the principles of subparagraphs (B), 
     (C), and (D) of section 432(n)(11).''.
       (8) Section 439(a)(2)(D) of such Code, as so added, is 
     amended by striking ``432(f)(9)(D)(vi)'' and inserting 
     ``432(h)(8)(D)(vi)''.
       (9) Section 439(a)(3) of such Code, as so added, is amended 
     by striking ``432(f)(8)'' and inserting ``432(m)(1)(D)''.
       (10) Section 440A(d)(2)(D) of such Code, as so added and 
     amended, is further amended by striking ``funding improvement 
     or rehabilitation plan'' and inserting ``funding improvement, 
     rehabilitation, or solvency plan''.
       (k) Effective Date.--Except as otherwise provided in 
     subsection (a)(7), the amendments made by this section shall 
     apply to plan years beginning after December 31, 2020.
       (l) Credit Ratings.--No requirement of section 939 or 939A 
     of the Dodd-Frank Wall Street Reform and Consumer Protection 
     Act (124 Stat. 1887; 15 U.S.C. 78o-7 note) shall apply with 
     respect to the amendment made by subsection (i)(2).

     SEC. 212. AMENDMENTS TO EMPLOYEE RETIREMENT INCOME SECURITY 
                   ACT OF 1974.

       (a) Rules Applying to All Multiemployer Plans.--
       (1) In general.--Subsection (a) of section 305 of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1085) is amended--
       (A) by striking ``a multiemployer plan in effect on July 
     16, 2006--'' and inserting ``any multiemployer plan--'',
       (B) by redesignating paragraphs (1), (2), and (3) as 
     paragraphs (2), (3), and (4), respectively,
       (C) by inserting before paragraph (2), as so redesignated, 
     the following new paragraph:
       ``(1) the rules of subsection (c) shall apply,'',
       (D) by striking ``subsection (c)'' in paragraph (2)(A), as 
     so redesignated, and inserting ``subsection (d)'',
       (E) by striking ``subsection (d)'' in paragraph (2)(B), as 
     so redesignated, and inserting ``subsection (e)'',
       (F) by striking ``subsection (e)'' in paragraph (3)(A), as 
     so redesignated, and inserting ``subsection (f)'',
       (G) by striking ``subsection (f)'' in paragraph (3)(B), as 
     so redesignated, and inserting ``subsection (g)'', and
       (H) by striking ``subsection (e)(9)'' in paragraph (4)(B), 
     as so redesignated, and inserting ``subsection (f)(9)''.
       (2) Rules of immediate application.--Section 305 of such 
     Act (29 U.S.C. 1085) is amended--
       (A) by redesignating subsections (c), (d), (e), (f), (g), 
     (h), (i), and (j) as subsections (d), (e), (f), (g), (h), 
     (i), (j), and (k), respectively, and
       (B) by inserting after subsection (b) the following new 
     subsection:
       ``(c) Rules Applying to All Multiemployer Plans.--
       ``(1) Benefit increases.--
       ``(A) Increases by plan amendment.--The plan sponsor of any 
     multiemployer plan shall not adopt a plan amendment which 
     increases plan liabilities (as determined as of the date of 
     the adoption of the amendment) due to any increase in 
     benefits, any change in the accrual rate of benefits, or any 
     change in the rate at which benefits become nonforfeitable, 
     unless--
       ``(i) if the plan is in unrestricted status as of the 
     adoption of such amendment, the plan actuary certifies in 
     accordance with subsection (b)(4) that the increase in 
     liabilities will not cause the plan to no longer be in 
     unrestricted status,
       ``(ii) if the plan is in stable status as of the adoption 
     of such amendment, the plan actuary certifies in accordance 
     with subsection (b)(4) that any such increase or change in 
     benefits will be paid from additional contributions not 
     required by any collective bargaining agreement in effect as 
     of the adoption of the amendment,
       ``(iii) if the plan is in endangered status as of the 
     adoption of such amendment, the plan actuary certifies in 
     accordance with subsection (b)(4) that any such increase or 
     change in benefits will be paid from additional contributions 
     not contemplated in any current funding improvement plan, or
       ``(iv) the increase or change in benefits is required by 
     law or is a de minimis change.
       ``(B) Increases under critical or critical and declining 
     status.--Unless required as a condition of qualification 
     under part I of subchapter D of chapter 1 of the Internal 
     Revenue Code of 1986 or to comply with other applicable law, 
     in the case of a plan which is in critical or critical and 
     declining status, no increase in benefits, change in the 
     accrual rate of benefits, or change in the rate at which 
     benefits become nonforfeitable which increases plan 
     liabilities shall take effect while the plan is in such 
     status, without regard to whether such increase or change 
     would otherwise occur under the provisions of the plan, 
     unless the increase in plan liabilities due to the change is 
     de minimis.
       ``(2) Contribution reductions.--The plan sponsor of any 
     multiemployer plan shall not accept any collective bargaining 
     agreement or participation agreement which reduces the rate 
     of contributions under the plan for any participants, 
     suspends contributions with respect to any period of service, 
     or directly or indirectly excludes younger, probationary, or 
     newly hired employees from participation in the plan, 
     unless--
       ``(A) the plan is in unrestricted status as of the adoption 
     of such agreement and the plan actuary certifies in 
     accordance with subsection (b)(4) that the reduction in 
     contributions will not cause the plan to no longer be in 
     unrestricted status,
       ``(B) the reduction in contributions is accompanied by a 
     reduction in future accruals for the affected participants, 
     and the plan actuary certifies in accordance with subsection 
     (b)(4) that the combined effect of the changes in 
     contributions and benefits is not projected to reduce the 
     funded percentage of the plan in any year, or
       ``(C) subject to regulations issued by the Secretary of the 
     Treasury, the plan sponsor reasonably determines that the 
     acceptance of such an agreement is in the best interests of 
     plan participants and beneficiaries and that rejection of the 
     agreement would have an adverse financial effect on the 
     plan.''.
       (3) Stable and unrestricted plans.--Subsection (b) of 
     section 305 of such Act (29 U.S.C. 1085) is amended--
       (A) by striking ``Endangered and Critical'' in the heading,
       (B) by redesignating paragraphs (1), (2), (3), (4), (5), 
     and (6) as paragraphs (2), (3), (4), (5), (6), and (7), 
     respectively, and
       (C) by inserting before paragraph (2) the following new 
     paragraph:
       ``(1) Stable and unrestricted status.--
       ``(A) Stable.--A multiemployer plan is in stable status for 
     a plan year if, as determined by the plan actuary under 
     paragraph (4), the plan is not in unrestricted status for the 
     plan year, is not in endangered, critical, or critical and 
     declining status for the plan year, and is not described in 
     paragraph (6).
       ``(B) Unrestricted.--A multiemployer plan is in 
     unrestricted status for a plan year if, as determined by the 
     plan actuary under paragraph (4)--
       ``(i) the plan is not in endangered, critical, or critical 
     and declining status for the plan year,
       ``(ii) the plan is not described in paragraph (6), and
       ``(iii) as of the beginning of the plan year--

       ``(I) the plan's current liability funded percentage for 
     such plan year is at least 70 percent and the plan's 
     projected funded percentage as of the first day of the 15th 
     succeeding plan year is at least 115 percent, or
       ``(II) the plan's current liability funded percentage for 
     such plan year is at least 80 percent.

       ``(C) Current liability funded percentage.--For purposes of 
     this section, the term `current liability funded percentage' 
     means

[[Page S7608]]

     the percentage equal to a fraction the numerator of which is 
     the value of plan assets (as determined for purposes of 
     section 304(c)(6)(A)(ii)(II)) and the denominator of which is 
     the current liabilities of the plan (as defined in section 
     304(c)(6)(D)).''.
       (4) Amendment to annual certification by plan actuary.--
     Subparagraph (A) of paragraph (4) (as redesignated by 
     paragraph (3)) of section 305(b) of such Act (29 U.S.C. 
     1085(b)) is amended by inserting ``whether or not the plan is 
     in unrestricted or stable status for such plan year,'' in 
     clause (i) before ``whether or not the plan is in endangered 
     status''.
       (5) Conforming and technical amendments.--
       (A) Technical correction.--Section 305(b)(3)(B) of such Act 
     (29 U.S.C. 1085(b)(3)(B)) is amended by redesignating the 
     clause (iv) relating to projections of critical and declining 
     status, as added by section 201(a)(5) of the Consolidated and 
     Further Continuing Appropriations Act, 2015, as clause (v), 
     and by moving such clause to the position immediately after 
     clause (iv).
       (B) Conforming amendments.--
       (i) Paragraphs (2) and (3) of section 305(b) of such Act 
     (29 U.S.C. 1085(b)), as redesignated by paragraph (3), are 
     each amended by striking ``paragraph (3)'' and inserting 
     ``paragraph (4)''.
       (ii) Section 305(b)(2) of such Act (29 U.S.C. 1085(b)(2)), 
     as so redesignated and amended, is further amended by 
     striking ``paragraph (5)'' and inserting ``paragraph (6)''.
       (iii) Section 305(b)(4) of such Act (29 U.S.C. 1085(b)(4)), 
     as so redesignated, is amended--

       (I) by striking ``paragraph (4)'' in subparagraph (B)(iv) 
     thereof and inserting ``paragraph (5)'',
       (II) by striking ``subsection (e)(9)'' both places it 
     appears in subparagraph (B)(v), as redesignated by 
     subparagraph (A), and inserting ``subsection (f)(9)'',
       (III) by striking ``subsection (e)(3)(A)(ii)'' in 
     subparagraph (B)(v), as so redesignated, and inserting 
     ``subsection (f)(3)(A)(ii)'',
       (IV) by striking ``subsection (e)'' in subparagraph (B)(v), 
     as so redesignated, and inserting ``subsection (f)'',
       (V) by striking ``paragraph (4)'' each place it appears in 
     subparagraphs (D)(i) and (D)(v) thereof and inserting 
     ``paragraph (5)'',
       (VI) by striking ``subsection (e)(8)'' in subparagraph 
     (D)(iii)(I) thereof and inserting ``subsection (f)(8)'',
       (VII) by striking ``paragraph (5)'' in subparagraph 
     (D)(iii) thereof and inserting ``paragraph (6)'', and
       (VIII) by striking ``(iii) In the case of'' in subparagraph 
     (D)(iii) thereof and inserting ``(iii) Special rule.--''.

       (iv) Section 305(b)(5) of such Act (29 U.S.C. 1085(b)(5)), 
     as redesignated by paragraph (3), is amended--

       (I) by striking ``paragraph (2)'' and inserting ``paragraph 
     (3)'',
       (II) by striking ``paragraph (3)(B)(iv)'' and inserting 
     ``paragraph (4)(B)(iv)'',
       (III) by striking ``paragraph (3)'' in subparagraph (A) 
     thereof and inserting ``paragraph (4)'',
       (IV) by striking ``paragraph (3)(A)'' in subparagraph (A) 
     thereof and inserting ``paragraph (4)(A)'',
       (V) by striking ``paragraph (2)'' in subparagraph (B) 
     thereof and inserting ``paragraph (3)'', and
       (VI) by striking ``subsection (e)(4)(B)'' in subparagraph 
     (C) thereof and inserting ``subsection (f)(4)(B)''.

       (v) Section 305(b)(6)(A) of such Act (29 U.S.C. 
     1085(b)(6)(A)), as so redesignated, is amended--

       (I) by striking ``paragraph (3)(A)'' and inserting 
     ``paragraph (4)(A)'',
       (II) by striking ``paragraph (1)(A)'' and inserting 
     ``paragraph (2)(A)'', and
       (III) by striking ``paragraph (1)(B)'' and inserting 
     ``paragraph (2)(B)''.

       (vi) Section 305(b)(7) of such Act (29 U.S.C. 1085(b)(7)), 
     as so redesignated, is amended by striking ``paragraph (2)'' 
     and inserting ``paragraph (3)''.
       (vii) Paragraphs (1)(A), (4)(A)(ii), (4)(C)(i), (4)(C)(ii), 
     (4)(D), (5)(A)(i), (5)(B), and (8) of subsection (d), and 
     subsections (e)(2), (f)(1)(A), (f)(4)(B)(i), 
     (f)(4)(B)(ii)(I), (f)(5), and (g)(3) of section 305 of such 
     Act (29 U.S.C. 1085), as respectively redesignated by 
     paragraph (2), are each amended by striking ``subsection 
     (b)(3)(A)'' and inserting ``subsection (b)(4)(A)''.
       (viii) Section 305(d)(3)(A)(i)(I) of such Act (29 U.S.C. 
     1085(d)(3)(A)(i)(I)), as so redesignated, is amended by 
     striking ``paragraph (b)(3)'' and inserting ``subsection 
     (b)(4)''.
       (ix) Section 305(d)(4)(D) of such Act (29 U.S.C. 
     1085(d)(4)(D)), as so redesignated, is amended by striking 
     ``subsection (d)'' and inserting ``subsection (e)''.
       (x) Section 305(e) of such Act (29 U.S.C. 1085(e)), as so 
     redesignated, is amended to read as follows:
       ``(e) Rules for Operation of Plan During Adoption and 
     Improvement Periods.--A plan may not be amended after the 
     date of the adoption of a funding improvement plan under 
     subsection (d) so as to be inconsistent with the funding 
     improvement plan or the requirements of subsection (c).''.
       (xi) Clauses (i)(I) and (ii)(I) of section 305(f)(4)(B) of 
     such Act (29 U.S.C. 1085(f)(4)(B)), as so redesignated, are 
     each amended by striking ``subsection (b)(2)'' and inserting 
     ``subsection (b)(3)''.
       (xii) Subsections (f)(8)(A)(ii) and (g)(2)(A) of section 
     305 of such Act (29 U.S.C. 1085), as so redesignated, are 
     each amended by striking ``subsection (b)(3)(D)'' and 
     inserting ``subsection (b)(4)(D)''.
       (xiii) Section 305(f)(9)(J) of such Act (29 U.S.C. 
     1085(f)(9)(J)), as so redesignated, is amended--

       (I) by striking ``subsection (b)(3)'' and inserting 
     ``subsection (b)(4)'', and
       (II) by striking ``paragraphs (1) and (2)'' in clause (i) 
     thereof and inserting ``paragraphs (2) and (3)''.

       (xiv) Subparagraphs (A) and (B) of section 305(g)(1) of 
     such Act (29 U.S.C. 1085(g)(1)), as so redesignated, are each 
     amended by striking ``subsection (e)'' and inserting 
     ``subsection (f)''.
       (xv) Paragraph (2)(A) of section 305(g) of such Act (29 
     U.S.C. 1085(g)), as so redesignated, is amended by striking 
     ``(b)(3)(D)'' and inserting ``(b)(4)(D)''.
       (xvi) Section 305(h) of such Act (29 U.S.C. 1085(h)), as so 
     redesignated, is amended--

       (I) by striking ``subsection (e)(8) or (f)'' in paragraph 
     (1) thereof and inserting ``subsection (f)(8) or (g)'',
       (II) by striking ``subsection (e)(9)'' in paragraph (1) 
     thereof and inserting ``subsection (f)(9)'',
       (III) by striking ``subsection (e)(7)'' in paragraph (2) 
     thereof and inserting ``subsection (f)(7)'', and
       (IV) by striking ``rehabilitation plan'' and all that 
     follows in paragraph (3)(B) thereof and inserting 
     ``rehabilitation plan. The preceding sentence shall not apply 
     to any increase in contribution requirements due to increased 
     levels of work, employment, or periods for which compensation 
     is provided, except to the extent such an increase is used to 
     provide an increased accrual rate of benefits or change in 
     the rate at which benefits become nonforfeitable which 
     increases plan liabilities.''.

       (xvii) Section 305(i) of such Act (29 U.S.C. 1085(i)), as 
     so redesignated, is amended--

       (I) by striking ``subsection (c)'' and inserting 
     ``subsection (d)'', and
       (II) by striking ``subsection (e)'' and inserting 
     ``subsection (f)''.

       (xviii) Section 305(j)(2) of such Act (29 U.S.C. 
     1085(j)(2)), as so redesignated, is amended by striking 
     ``subsections (c) and (e)'' and inserting ``subsections (d) 
     and (f)''.
       (xix) Section 101(f)(2)(B) of such Act (29 U.S.C. 
     1021(f)(2)(B)) is amended--

       (I) by striking ``305(i)'' in clause (i)(II) and inserting 
     ``305(k)'', and
       (II) by striking ``305(i)(8)'' in clause (ii)(II) and 
     inserting ``305(k)(8)''.

       (xx) Section 103(f)(1)(B)(ii) of such Act (29 U.S.C. 
     1023(f)(1)(B)(ii)) is amended by striking ``305(i)(2)'' and 
     inserting ``305(k)(2)''.
       (xxi) Section 302(b)(3) of such Act (29 U.S.C. 1082) is 
     amended by striking ``section 305(e)'' and inserting 
     ``section 305(f)''.
       (xxii) Section 4231(e)(2)(A) of such Act (29 U.S.C. 
     1411(e)(2)(A)) is amended by striking ``section 305(b)(4)'' 
     and inserting ``305(b)(7)''.
       (xxiii) Section 4233 of such Act (29 U.S.C. 1413) is 
     amended--

       (I) by striking ``305(e)(9)'' each place it appears in 
     subsections (b)(2) and (e)(1)(A) and inserting ``305(f)(9)'', 
     and
       (II) by striking ``305(e)(9)(E)(vi)'' in subsection (e)(2) 
     and inserting ``305(f)(9)(E)(vi)''.

       (xxiv) Section 4245 of such Act (29 U.S.C. 1426), as 
     amended by this Act, is amended--

       (I) by striking ``305(b)(2),,'' in subsection (c)(1), as 
     redesignated by section 112, and inserting ``305(b)(3),'',
       (II) by striking ``305(b)(2)'' each place it appears in 
     subsections (c)(2), (d)(1), and (d)(2), as so redesignated, 
     and inserting ``305(b)(3)'', and
       (III) by striking ``305(e)(9)'' in subsection (f), as so 
     redesignated, and inserting ``305(f)(9)''.

       (xxv) The heading of section 305 of such Act (29 U.S.C. 
     1085) is amended by striking ``in endangered status or 
     critical status''.
       (6) Withdrawal liability determination for plans emerging 
     from endangered or critical status.--Section 305(h) of such 
     Act (29 U.S.C. 1085(h)), as redesignated by paragraph (2) and 
     as amended by paragraph (5), is further amended by striking 
     paragraph (4) and by inserting after paragraph (3) the 
     following new paragraph:
       ``(4) Emergence from endangered or critical status.--
       ``(A) In general.--In the case of increases in the 
     contribution rate (or other increases in contribution 
     requirements unless due to increased levels of work, 
     employment, or periods for which compensation is provided) 
     disregarded pursuant to paragraph (3), this subsection shall 
     cease to apply as of the later of--
       ``(i) the end of the first plan year following the plan 
     year in which the plan is no longer in endangered or critical 
     status, or
       ``(ii) the end of the plan year which includes the 
     expiration date of the first collective bargaining agreement 
     requiring plan contributions which expires after the plan is 
     no longer in endangered or critical status.
       ``(B) Highest contribution rate.--Notwithstanding 
     subparagraph (A), once the plan emerges from endangered or 
     critical status--
       ``(i) increases in the contribution rate disregarded 
     pursuant to paragraph (3) shall continue to be disregarded in 
     determining the highest contribution rate under section 
     4219(c) for plan years during which the plan was in 
     endangered or critical status, and
       ``(ii) the highest contribution rate for purposes of such 
     section shall be the greater of--

       ``(I) the sum of--

       ``(aa) the employer's contribution rate as of the later of 
     the last day of the last plan year ending before December 31, 
     2014, and the

[[Page S7609]]

     last day of the plan year for which the employer first had an 
     obligation to contribute to the plan, and
       ``(bb) any contribution increases determined in accordance 
     with this section after such later date and before the date 
     the employer withdraws from the plan, or

       ``(II) the highest contribution rate for any plan year 
     after the plan year which includes the earlier of--

       ``(aa) the expiration date of the first collective 
     bargaining agreement applicable to the withdrawing employer 
     requiring plan contributions which expires after the plan is 
     no longer in endangered or critical status, or
       ``(bb) the date as of which the withdrawing employer 
     negotiated a contribution rate effective after the plan year 
     in which the plan is no longer in endangered or critical 
     status.''.
       (7) Effective date.--The amendments made by this subsection 
     shall take effect on the date of the enactment of this Act.
       (b) Determination of Endangered Status.--Paragraph (2) of 
     section 305(b) of the Employee Retirement Income Security Act 
     of 1974 (29 U.S.C. 1085(b)), as redesignated by subsection 
     (a)(3), is amended to read as follows:
       ``(2) Endangered status.--A multiemployer plan is in 
     endangered status for a plan year if, as determined by the 
     plan actuary under paragraph (5), the plan is not in critical 
     or declining status for the plan year and is not described in 
     paragraph (7), and, as of the beginning of the plan year--
       ``(A) the plan's funded percentage for such plan year is 
     less than 80 percent,
       ``(B) the plan is projected to have an accumulated funding 
     deficiency for any of the 9 succeeding plan years, taking 
     into account any extension of amortization periods under 
     section 304(d), or
       ``(C) the plan's projected funded percentage as of the 
     first day of the 15th succeeding plan year is less than 100 
     percent.''.
       (c) Determination of Critical Status.--Paragraph (3) of 
     section 305(b) of the Employee Retirement Income Security Act 
     of 1974 (29 U.S.C. 1085(b)), as redesignated by subsection 
     (a)(3), is amended to read as follows:
       ``(3) Critical status.--
       ``(A) In general.--A multiemployer plan is in critical 
     status for a plan year if, as determined by the plan actuary 
     under paragraph (5), the plan is not in declining status for 
     the plan year and, as of the beginning of the plan year--
       ``(i) the plan's funded percentage is less than 65 percent,
       ``(ii) the plan has an accumulated funding deficiency for 
     the plan year, or is projected to have such an accumulated 
     funding deficiency for any of the 6 succeeding plan years, 
     taking into account any extension of amortization periods 
     under section 304(d), or
       ``(iii) the plan's projected funded percentage as of the 
     first day of the 15th succeeding plan year is less than 80 
     percent.
       ``(B) Original plans.--Notwithstanding subparagraph (A), a 
     multiemployer plan which is an original plan pursuant to 
     section 4233A(d)(3) shall be treated as being in critical 
     status for the period of 15 consecutive plan years beginning 
     with the plan year that includes the date of the partition 
     under section 4233A.''.
       (d) Declining Status.--
       (1) In general.--
       (A) The following provisions of section 305 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1085) are 
     each amended by striking ``critical and declining'' each 
     place it appears and inserting ``declining'':
       (i) Subsection (a)(4) (as redesignated by subsection 
     (a)(1)).
       (ii) Subparagraphs (A) and (B)(i) of subsection (b)(1), as 
     added by subsection (a)(3).
       (iii) Subsection (b)(4)(B)(v) (as redesignated by 
     subsection (a)(3)).
       (iv) The heading of clause (v) of subsection (b)(4)(B), as 
     redesignated by subsection (a)(3).
       (v) Paragraph (1)(B), and the heading of such paragraph 
     (1)(B), of subsection (c), as added by subsection (a)(2).
       (vi) The heading of paragraph (9) of subsection (f) (as 
     redesignated by subsection (a)(2)).
       (vii) Subparagraphs (A), (C), (G)(i), and (J) of subsection 
     (f)(9) (as so redesignated).
       (viii) Subsection (h)(1) (as so redesignated).
       (B) Subsections (c), as amended by section 221, and 
     (e)(2)(A), as amended by this section, of section 4231 of 
     such Act (29 U.S.C. 1411(e)(2)(A)) are each further amended 
     by striking ``critical and declining status'' and inserting 
     ``declining status''.
       (C) Section 4233(b)(1) of such Act (29 U.S.C. 1413(b)(1)) 
     is amended by striking ``critical and declining status'' and 
     inserting ``declining status''.
       (D) Section 4245(f) of such Act (29 U.S.C. 1426), as 
     amended by section 112 and subsection (a), is further amended 
     by striking ``critical and declining status'' and inserting 
     ``declining status''.
       (2) Determination of declining status.--
       (A) In general.--Subsection (b) of section 305 of such Act 
     (29 U.S.C. 1085) is amended--
       (i) by striking paragraph (7), as redesignated by 
     subsection (a)(3),
       (ii) by redesignating paragraphs (4), (5), and (6), as so 
     redesignated, as paragraphs (5), (6), and (7), respectively, 
     and
       (iii) by inserting after paragraph (3), as so redesignated, 
     the following new paragraph:
       ``(4) Declining status.--A multiemployer plan is in 
     declining status for a plan year if--
       ``(A) as determined by the plan actuary under paragraph 
     (5), as of the beginning of the plan year the plan is 
     projected to become insolvent within the plan year or any of 
     the 29 succeeding plan years,
       ``(B) the plan is otherwise in critical status for the plan 
     year as determined by the plan actuary under paragraph (5), 
     and the plan sponsor determines that, based on reasonable 
     actuarial assumptions and upon exhaustion of all reasonable 
     measures, the plan cannot reasonably be expected to emerge 
     from critical status within the next 30 plan years, or
       ``(C) the plan has a funded percentage for the plan year 
     which is greater than the projected funded percentage as of 
     the first day of the 15th succeeding plan year, unless the 
     funded percentage for the plan year is 100 percent or greater 
     and the projected funded percentage as of the first day of 
     such 15th succeeding plan year is less than 100 percent.''.
       (B) Conforming amendments.--
       (i) Paragraph (1) of section 305(b) of such Act (29 U.S.C. 
     1085), as added by subsection (a)(3), is amended--

       (I) by striking ``paragraph (4)'' each place it appears in 
     subparagraphs (A) and (B) and inserting ``paragraph (5)'', 
     and
       (II) by striking ``paragraph (6)'' each place it appears in 
     subparagraphs (A) and (B) and inserting ``paragraph (7)''.

       (ii) Subsection (c) of section 305 of such Act (29 U.S.C. 
     1085), as added by subsection (a)(2), is amended by striking 
     ``(b)(4)'' each place it appears in paragraphs (1)(A)(i), 
     (1)(A)(ii), (1)(A)(iii), (2)(A), and (2)(B) and inserting 
     ``(b)(5)''.
       (iii) Section 305(b)(5) of such Act (29 U.S.C. 1085(b)(5)), 
     as further redesignated by subparagraph (A) and as amended by 
     section 321 and subsection (a), is further amended--

       (I) by striking ``paragraph (5)'' in subparagraph (B)(iv) 
     thereof and inserting ``paragraph (6)'',
       (II) by striking ``paragraph (5)'' each place it appears in 
     subparagraphs (D)(i) and (D)(vi) thereof and inserting 
     ``paragraph (6)'', and
       (III) by striking ``paragraph (6)'' in subparagraph (D)(iv) 
     thereof and inserting ``paragraph (7)''.

       (iv) Section 305(b)(6) of such Act (29 U.S.C. 1085(b)(6)), 
     as so further redesignated and amended, is further amended--

       (I) by striking ``paragraph (4)(B)(iv)'' and inserting 
     ``paragraph (5)(B)(iv)'',
       (II) by striking ``paragraph (4)'' in subparagraph (A) 
     thereof and inserting ``paragraph (5)'', and
       (III) by striking ``paragraph (4)(A)'' in subparagraph (A) 
     thereof and inserting ``paragraph (5)(A)''.

       (v) Section 305(b)(7)(A) of such Act (29 U.S.C. 
     1085(b)(7)(A)), as so further redesignated and amended, is 
     further amended--

       (I) by striking ``paragraph (4)(A)'' and inserting 
     ``paragraph (5)(A)'', and
       (II) by striking ``either paragraph (2)(A) or paragraph 
     (2)(B)'' and inserting ``any subparagraph of paragraph (2)''.

       (vi) Section 305(b)(7)(B) of such Act (29 U.S.C. 
     1085(b)(7)(B)), as so further redesignated, is amended by 
     striking ``critical or endangered'' and inserting 
     ``endangered, critical, or declining''.
       (vii) Paragraphs (1)(A), (4)(A)(ii), (4)(C)(i), (4)(C)(ii), 
     (4)(D), and (8) of subsection (d), and subsections (f)(1)(A), 
     (f)(4)(B)(i), (f)(4)(B)(ii)(I), (f)(5), and (g)(3) of section 
     305 of such Act (29 U.S.C. 1085), as redesignated and amended 
     by subsection (a), are each further amended by striking 
     ``subsection (b)(4)(A)'' and inserting ``subsection 
     (b)(5)(A)''.
       (viii) Section 305(d)(3)(A)(i)(I) of such Act (29 U.S.C. 
     1085(d)(3)(A)(i)(I)), as so redesignated and amended, is 
     further amended by striking ``subsection (b)(4)'' and 
     inserting ``subsection (b)(5)''.
       (ix) Subsections (f)(8)(A)(ii) and (g)(2)(A) of section 305 
     of such Act (29 U.S.C. 1085), as so redesignated and amended, 
     are each further amended by striking ``subsection (b)(4)(D)'' 
     and inserting ``subsection (b)(5)(D)''.
       (x) Section 305(f)(9)(J) of such Act (29 U.S.C. 
     1085(f)(9)(J)), as so redesignated and amended, is further 
     amended by striking ``subsection (b)(4)'' and inserting 
     ``subsection (b)(5)''.
       (xi) Section 4231(e)(2)(A) of such Act (29 U.S.C. 
     1411(e)(2)(A)), as amended by this section, is further 
     amended by striking ``305(b)(7)'' and inserting 
     ``305(b)(4)''.
       (3) Solvency plan.--
       (A) In general.--Paragraph (4) (as redesignated by 
     subsection (a)(1) and amended by paragraph (1)) of section 
     305(a) of such Act (29 U.S.C. 1085(a)) is amended--
       (i) by redesignating subparagraph (B) as subparagraph (D), 
     and
       (ii) by striking subparagraph (A) and inserting before 
     subparagraph (D) (as so redesignated) the following new 
     subparagraphs:
       ``(A) the plan sponsor shall adopt and implement a solvency 
     plan in accordance with the requirements of subsection (h),
       ``(B) any rehabilitation plan in place as of the date the 
     plan enters declining status shall continue to apply 
     throughout the solvency plan adoption period,
       ``(C) the requirements of subsection (i) and paragraphs (6) 
     and (7) of subsection (f) shall apply during the solvency 
     plan adoption period and the solvency attainment period, 
     and''.
       (B) Adoption of plan.--Section 305 of such Act (29 U.S.C. 
     1085), as amended by this section, is further amended--
       (i) by redesignating subsection (l), as added by title V of 
     this Act, as subsection (n), and by further redesignating 
     subsections (h), (i), (j), and (k), as redesignated by 
     subsection

[[Page S7610]]

     (a)(2), as subsections (j), (k), (l), and (m), respectively, 
     and
       (ii) by inserting after subsection (g), as redesignated by 
     subsection (a)(2), the following new subsections:
       ``(h) Solvency Plan Must Be Adopted for Multiemployer Plans 
     in Declining Status.--
       ``(1) In general.--In any case in which a multiemployer 
     plan is in declining status for a plan year, the plan 
     sponsor, in accordance with this subsection--
       ``(A) shall adopt a solvency plan not later than 240 days 
     following the required date for the actuarial certification 
     of declining status under subsection (b)(5)(A), and
       ``(B) within 30 days after the adoption of the solvency 
     plan shall provide to the bargaining parties 1 or more 
     schedules showing revised benefit structures, revised 
     contribution structures, or both, which, if adopted, may 
     reasonably be expected to enable the multiemployer plan to 
     meet the requirements of paragraph (3), including--
       ``(i) one default proposal under which--

       ``(I) all adjustable benefits in the form of early 
     retirement subsidies (including early reduction factors which 
     are not provided on an actuarially equivalent basis) under 
     the plan are eliminated, and
       ``(II) the future monthly benefit accrual rate under the 
     plan is reduced to the equivalent of 1 percent of annual 
     contributions (or, if lower, the current accrual rate) based 
     on the contribution rate in effect as of the later of the 
     first day of the plan year in which the plan enters declining 
     status or the date of a partition under section 4233A, and

     which may also include reduction or elimination of any other 
     adjustable benefits under the plan, and
       ``(ii) any additional schedules which reduce or eliminate 
     adjustable benefits under the plan which the plan sponsor 
     deems appropriate to provide as an alternative to the default 
     proposal.
     No schedule provided to or adopted by the bargaining parties 
     shall provide for a monthly benefit accrual rate in excess of 
     the rate described in subparagraph (B)(i)(II).
       ``(2) Exception for years after process begins.--Paragraph 
     (1) shall not apply to a plan year if such year is in a 
     solvency plan adoption period or solvency attainment period 
     by reason of the plan being in declining status for a 
     preceding plan year, except that the next update of the 
     solvency plan shall fulfill the requirement of paragraph 
     (1)(B)(i). For purposes of this section, such preceding plan 
     year shall be the initial determination year with respect to 
     the solvency plan to which it relates.
       ``(3) Solvency plan.--For purposes of this section, a 
     solvency plan is a plan which consists of the actions, 
     including options or a range of options to be proposed to the 
     bargaining parties, formulated, based on reasonably 
     anticipated experience and reasonable actuarial assumptions, 
     to enable the plan to delay or avoid the projected 
     insolvency.
       ``(4) Solvency attainment period.--For purposes of this 
     section--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the solvency attainment period for any solvency plan adopted 
     pursuant to this subsection is the period--
       ``(i) beginning on the first day of the first plan year of 
     the multiemployer plan beginning after the earlier of--

       ``(I) the second anniversary of the date of the adoption of 
     the solvency plan, or
       ``(II) the expiration of the collective bargaining 
     agreements in effect on the due date for the actuarial 
     certification of declining status for the initial 
     determination year under subsection (b)(5)(A) and covering, 
     as of such due date, at least 75 percent of the active 
     participants in such plan, and

       ``(ii) ending on the date the plan either emerges from 
     declining status or becomes insolvent.
       ``(B) Coordination with changes in status.--
       ``(i) Plans no longer in declining status.--If the plan's 
     actuary certifies in accordance with subparagraph (C) for a 
     plan year in any solvency plan adoption period or solvency 
     attainment period that the plan is no longer in declining 
     status, the solvency plan adoption period or solvency 
     attainment period, whichever is applicable, shall end as of 
     the date of such certification.
       ``(ii) Plans in critical or endangered status.--If the 
     plan's actuary certifies under subsection (b)(5)(A) for the 
     plan year described in clause (i) that the plan is in 
     critical or endangered rather than declining status, the 
     provisions of subsections (d) and (e), or subsections (f) and 
     (g), whichever are applicable, shall be applied as if such 
     plan year were an initial determination year, except that the 
     plan may not be amended in a manner inconsistent with the 
     solvency plan in effect for the preceding plan year until a 
     new funding improvement plan or rehabilitation plan, 
     whichever is applicable, is adopted.
       ``(C) Emergence.--A plan in declining status shall remain 
     in such status until a plan year for which the plan actuary 
     certifies, in accordance with subsection (b)(5)(A), that the 
     plan is not described in one or more of the subparagraphs in 
     subsection (b)(4) as of the beginning of the plan year.
       ``(5) Updates to solvency plans and schedules.--
       ``(A) Solvency plan.--The plan sponsor shall annually 
     update the solvency plan and shall file the update with the 
     plan's annual report under section 104.
       ``(B) Schedules.--The plan sponsor shall annually update 
     any schedule of contribution rates provided under this 
     subsection to reflect the experience of the plan.
       ``(C) Duration of schedule.--A schedule of contribution 
     rates provided by the plan sponsor and relied upon by 
     bargaining parties in negotiating a collective bargaining 
     agreement shall remain in effect for the duration of that 
     collective bargaining agreement.
       ``(6) Imposition of schedule where failure to adopt 
     solvency plan.--
       ``(A) Initial contribution schedule.--If--
       ``(i) a collective bargaining agreement providing for 
     contributions under a multiemployer plan that was in effect 
     at the time the plan entered declining status expires, and
       ``(ii) after receiving one or more schedules from the plan 
     sponsor under paragraph (1)(B), the bargaining parties with 
     respect to such agreement fail to adopt a contribution 
     schedule with terms consistent with the solvency plan and a 
     schedule from the plan sponsor,
     the plan sponsor shall implement the schedule described in 
     paragraph (1)(B)(i) beginning on the date specified in 
     subparagraph (C).
       ``(B) Subsequent contribution schedule.--If--
       ``(i) a collective bargaining agreement providing for 
     contributions under a multiemployer plan in accordance with a 
     schedule provided by the plan sponsor pursuant to a solvency 
     plan (or imposed under subparagraph (A)) expires while the 
     plan is still in declining status, and
       ``(ii) after receiving one or more updated schedules from 
     the plan sponsor under paragraph (5)(B), the bargaining 
     parties with respect to such agreement fail to adopt a 
     contribution schedule with terms consistent with the updated 
     solvency plan and a schedule from the plan sponsor,
     then the contribution schedule applicable under the expired 
     collective bargaining agreement, as updated and in effect on 
     the date the collective bargaining agreement expires, shall 
     be implemented by the plan sponsor beginning on the date 
     specified in subparagraph (C).
       ``(C) Date of implementation.--The date specified in this 
     subparagraph is the date which is 180 days after the date on 
     which the collective bargaining agreement described in 
     subparagraph (A) or (B) expires.
       ``(7) Solvency plan adoption period.--For purposes of this 
     section, the term `solvency plan adoption period' means the 
     period beginning on the date of the certification under 
     subsection (b)(5)(A) for the initial determination year and 
     ending on the day before the first day of the solvency 
     attainment period.
       ``(i) Rules for Operation of Plan During Adoption and 
     Attainment Periods.--
       ``(1) Compliance with solvency plan.--
       ``(A) In general.--A plan may not be amended after the date 
     of the adoption of a solvency plan under subsection (h) so as 
     to be inconsistent with the solvency plan.
       ``(B) Special rules for benefit increases.--A plan may not 
     be amended after the date of the adoption of a solvency plan 
     under subsection (h) so as to increase benefits, including 
     future benefit accruals, unless the increase is required by 
     law or is a de minimis change.
       ``(C) Special rules for increases in compensation or 
     contribution rate.--Any increase in employee compensation or 
     contribution rates which takes effect after the first day of 
     the plan year in which the plan enters declining status shall 
     not give rise to an increase in benefits or future benefit 
     accruals under the plan.
       ``(2) Restriction on lump sums and similar benefits.--
       ``(A) In general.--Effective on the date the notice of 
     certification of the plan's declining status for the initial 
     determination year under subsection (b)(5)(D) is sent, and 
     notwithstanding section 204(g), the plan shall not pay--
       ``(i) any payment, in excess of the monthly amount paid 
     under a single life annuity (plus any social security 
     supplements described in the last sentence of section 
     204(b)(1)(G)), to a participant or beneficiary whose annuity 
     starting date (as defined in section 205(h)(2)) occurs after 
     the date such notice is sent,
       ``(ii) any payment for the purchase of an irrevocable 
     commitment from an insurer to pay benefits, or
       ``(iii) any other payment specified by the Secretary of the 
     Treasury by regulations,
     unless it is a de minimis amount.
       ``(B) Exception.--Subparagraph (A) shall not apply to a 
     benefit which under section 203(e) may be immediately 
     distributed without the consent of the participant or to any 
     makeup payment in the case of a retroactive annuity starting 
     date or any similar payment of benefits owed with respect to 
     a prior period.
       ``(3) Special rules for plan adoption period.--During the 
     period beginning on the date of the certification under 
     subsection (b)(5)(A) for the initial determination year and 
     ending on the date of the adoption of a solvency plan--
       ``(A) the plan sponsor may not accept a collective 
     bargaining agreement or participation agreement with respect 
     to the multiemployer plan that provides for--
       ``(i) a reduction in the level of contributions for any 
     participants,
       ``(ii) a suspension of contributions with respect to any 
     period of service, or
       ``(iii) any new direct or indirect exclusion of younger or 
     newly hired employees from plan participation,
     unless the plan sponsor reasonably determines that the 
     acceptance of such an agreement is in the best interests of 
     participants and beneficiaries and that rejection of such

[[Page S7611]]

     agreement would adversely affect the plan, and
       ``(B) no amendment of the plan which increases the 
     liabilities of the plan by reason of any increase in 
     benefits, any change in the accrual of benefits, or any 
     change in the rate at which benefits become nonforfeitable 
     under the plan may be adopted unless the amendment is 
     required as a condition of qualification under part I of 
     subchapter D of chapter 1 of the Internal Revenue Code of 
     1986 or to comply with other applicable law.''.
       (C) Suspension of benefits.--Section 305 of such Act (29 
     U.S.C. 1085), as amended by this section, is further 
     amended--
       (i) by redesignating paragraph (9) of subsection (f) (as 
     redesignated by subsection (a)(2)) as paragraph (8) of 
     subsection (h) (as added by subparagraph (B)), and
       (ii) by moving such paragraph to the position immediately 
     after paragraph (7) of such subsection (h).
       (4) Conforming amendments.--
       (A) Subsection (a)(4)(D) of section 305 of such Act (29 
     U.S.C. 1085), as redesignated and amended by the preceding 
     provisions of this section, is further amended by striking 
     ``subsection (f)(9)'' and inserting ``subsection (h)(8)''.
       (B) Paragraph (5) of section 305(b) of such Act (29 U.S.C. 
     1085(b)), as so redesignated and as amended by section 321 
     and the preceding provisions of this section, is further 
     amended--
       (i) by striking ``critical'' in subparagraph (A)(i)(I) and 
     inserting ``critical or declining'',
       (ii) by striking ``funding improvement or rehabilitation 
     period'' in subparagraph (A)(i)(II) and inserting ``funding 
     improvement, rehabilitation, or solvency attainment period'',
       (iii) by striking ``funding improvement or rehabilitation 
     plan'' in subparagraph (A)(i)(II) and inserting ``funding 
     improvement, rehabilitation, or solvency plan'',
       (iv) by striking ``endangered or critical'' in subparagraph 
     (A)(i)(V)(bb) and inserting ``endangered, critical, or 
     declining'',
       (v) by striking ``funding improvement plan or 
     rehabilitation'' in subparagraph (A)(iv) and inserting 
     ``funding improvement, rehabilitation, or solvency'',
       (vi) by striking ``critical'' each place it appears in 
     subparagraph (A)(vi) and inserting ``critical or declining'',
       (vii) by striking ``rehabilitation period'' in subparagraph 
     (A)(vi) and inserting ``rehabilitation or solvency attainment 
     period'',
       (viii) by striking ``as described in subsection (f)(9)'' in 
     subparagraph (B)(v),
       (ix) by inserting ``if the plan is already in a 
     rehabilitation period, and'' before ``if reasonable'' in 
     subparagraph (B)(v)(I),
       (x) by striking ``subsection (f)(9)'' in subparagraph 
     (B)(v)(II) and inserting ``subsection (h)(8)'',
       (xi) by striking ``endangered or critical'' both places it 
     appears in subparagraph (D)(i) and inserting ``endangered, 
     critical, or declining'',
       (xii) by striking ``endangered or critical'' in the heading 
     of subparagraph (D)(ii) and inserting ``endangered, critical, 
     or declining'',
       (xiii) by striking ``endangered or critical'' in 
     subparagraph (D)(ii) and inserting ``endangered, critical, or 
     declining'',
       (xiv) by striking ``funding improvement or rehabilitation 
     plan'' both places it appears in subclauses (I) and (II) of 
     subparagraph (D)(ii) and inserting ``funding improvement, 
     rehabilitation, or solvency plan'', and
       (xv) by adding at the end of subparagraph (D) the following 
     new clause:
       ``(vii) Notice of projection to be in declining status in a 
     future plan year.--In any case in which it is certified under 
     subparagraph (A)(i) that a multiemployer plan will be in 
     declining status for any of 5 succeeding plan years (but not 
     for the current plan year), the plan sponsor shall, not later 
     than 30 days after the date of the certification, provide 
     notification of the projected declining status to the Pension 
     Benefit Guaranty Corporation.''.
       (C) Subparagraph (J) of section 305(h)(8) of such Act (29 
     U.S.C. 1085(h)(8)), as so redesignated and amended, is 
     further amended--
       (i) by striking ``critical'' in the heading and inserting 
     ``declining'', and
       (ii) by striking ``shall not emerge from critical status 
     under paragraph (4)(B),'' and inserting ``shall not emerge 
     from declining status''.
       (D) Subsection (j) of section 305 of such Act (29 U.S.C. 
     1085), as so redesignated and amended, is further amended--
       (i) by striking ``(f)(8) or (g)'' in paragraph (1) and 
     inserting ``(f)(8), (g), or (i)'',
       (ii) by striking ``subsection (f)(9)'' in paragraph (1) and 
     inserting ``subsection (h)(8)'',
       (iii) by striking ``funding improvement or rehabilitation 
     plan'' in the heading of paragraph (3) and inserting 
     ``funding improvement, rehabilitation, or solvency'',
       (iv) by striking ``funding improvement plan or 
     rehabilitation plan'' both places it appears in subparagraphs 
     (A) and (B) of paragraph (3) and inserting ``funding 
     improvement, rehabilitation, or solvency plan'',
       (v) by striking ``endangered or critical'' in the heading 
     of paragraph (4), as amended by subsection (a), and inserting 
     ``endangered, critical, or declining'',
       (vi) by striking ``endangered or critical'' each place it 
     appears in paragraph (4), as so amended, and inserting 
     ``endangered, critical, or declining'', and
       (vii) by striking ``critical or endangered'' in paragraph 
     (4) and inserting ``endangered, critical, or declining''.
       (E) Subsection (k) of section 305 of such Act (29 U.S.C. 
     1085), as so redesignated and amended, is further amended--
       (i) by striking ``or a rehabilitation plan under subsection 
     (f)'' and inserting ``, a rehabilitation plan under 
     subsection (f), or a solvency plan under subsection (h)'',
       (ii) by striking ``endangered status or a plan in critical 
     status'' and inserting ``endangered, critical, or declining 
     status'',
       (iii) by striking ``has not agreed on a funding improvement 
     plan or rehabilitation plan'' and inserting ``has not agreed 
     on a funding improvement, rehabilitation, or solvency plan 
     (whichever is applicable)'', and
       (iv) by striking ``adoption of a funding improvement plan 
     or rehabilitation plan'' and inserting ``adoption of a 
     funding improvement, rehabilitation, or solvency plan''.
       (F) Subsection (l) of section 305 of such Act (29 U.S.C. 
     1085), as so redesignated and amended, is further amended--
       (i) by striking ``endangered status or in critical status'' 
     in paragraph (1) and inserting ``endangered, critical, or 
     declining status'',
       (ii) by striking ``endangered or critical'' in paragraph 
     (1) and inserting ``endangered, critical, or declining'', and
       (iii) by striking ``(d) and (f)'' in paragraph (2) and 
     inserting ``(d), (f), and (h)''.
       (G) Section 101(f)(2)(B) of such Act (29 U.S.C. 
     1021(f)(2)(B)), as amended by this section, is amended--
       (i) by striking ``305(k)'' in clause (i)(II) and inserting 
     ``305(m)'', and
       (ii) by striking ``305(k)(8)'' in clause (ii)(II) and 
     inserting ``305(m)(8)''.
       (H) Section 101(k)(1)(K) of such Act (29 U.S.C. 
     1021(k)(1)(K)) is amended--
       (i) by striking ``critical or endangered'' and inserting 
     ``endangered, critical, or declining'', and
       (ii) by striking ``funding improvement or rehabilitation'' 
     both places it appears and inserting ``funding improvement, 
     rehabilitation, or solvency''.
       (I) Section 103(f)(1)(B)(ii) of such Act (29 U.S.C. 
     1023(f)(1)(B)(ii)), as amended by this section, is amended by 
     striking ``305(k)(2)'' and inserting ``305(m)(2)''.
       (J) Section 103(f)(2)(G) of such Act (29 U.S.C. 
     1023(f)(2)(G)) is amended--
       (i) by striking ``critical or endangered'' and inserting 
     ``endangered, critical, or declining'', and
       (ii) by striking ``funding improvement or rehabilitation'' 
     and inserting ``funding improvement, rehabilitation, or 
     solvency''.
       (K) Section 104(d)(1)(E) of such Act (29 U.S.C. 
     1024(d)(1)(E)) is amended--
       (i) by striking ``critical or endangered'' and inserting 
     ``endangered, critical, or declining'', and
       (ii) by striking ``funding improvement or rehabilitation'' 
     and inserting ``funding improvement, rehabilitation, or 
     solvency''.
       (L) Section 502(a)(10) of such Act (29 U.S.C. 1132(a)(10)) 
     is amended--
       (i) by striking ``endangered or critical'' and inserting 
     ``endangered, critical, or declining'', and
       (ii) by striking ``funding improvement or rehabilitation'' 
     each place it appears and inserting ``funding improvement, 
     rehabilitation, or solvency''.
       (M) Section 502(c)(8) of such Act (29 U.S.C. 1132(c)(8)) is 
     amended--
       (i) by striking ``funding improvement plan or 
     rehabilitation'' in subparagraph (A) and inserting ``funding 
     improvement, rehabilitation, or solvency'',
       (ii) by striking ``endangered or critical'' in subparagraph 
     (A) and inserting ``endangered, critical, or declining'',
       (iii) by striking ``which is not in seriously endangered 
     status'' in subparagraph (B), and
       (iv) by striking ``meet the applicable benchmarks'' in 
     subparagraph (B) and inserting ``emerge from endangered 
     status''.
       (N) Section 4233 of such Act (29 U.S.C. 1413), as amended 
     by this section, is further amended--
       (i) by striking ``305(f)(9)'' each place it appears in 
     subsections (b)(2) and (e)(1)(A) and inserting ``305(h)(8)'', 
     and
       (ii) by striking ``305(f)(9)(E)(vi)'' in subsection (e)(2) 
     and inserting ``305(h)(8)(E)(vi)''.
       (O) Section 4233(m)(1) of such Act, as added by this Act, 
     is amended by striking ``funding improvement or 
     rehabilitation'' and inserting ``funding improvement, 
     rehabilitation, or solvency''.
       (P) Section 4233A(h)(4)(C) of such Act, as added by this 
     Act, is amended by striking ``rehabilitation plan'' and 
     inserting ``rehabilitation or solvency plan''.
       (Q) Section 4233A(m)(1) of such Act, as added by this Act, 
     is amended by striking ``funding improvement or 
     rehabilitation'' and inserting ``funding improvement, 
     rehabilitation, or solvency''
       (R) Section 4233A(o)(1) of such Act, as added by this Act, 
     is amended by striking ``305(k)(2)'' and inserting 
     ``305(m)(2)''.
       (S) Section 4233A(o)(12) of such Act, as added by this Act, 
     is amended by striking ``funding improvement plan or 
     rehabilitation'' and inserting ``funding improvement, 
     rehabilitation, or solvency''.
       (T) Section 4245 of such Act (29 U.S.C. 1426), as amended 
     by section 112 and this section, is further amended--
       (i) by striking ``305(b)(3)'' each place it appears in 
     subsections (c)(1), (c)(2), (d)(1), and (d)(2) and inserting 
     ``305(b)(3), or a plan in declining status, as described in 
     section 305(b)(4)'', and
       (ii) by striking ``305(f)(9)'' in subsection (f) and 
     inserting ``305(h)(8)''.
       (e) Adjustment of Benefits.--

[[Page S7612]]

       (1) In general.--Section 305 of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1085), as amended by 
     this section, is further amended--
       (A) by further redesignating subsections (m) and (n), as 
     redesignated by subsection (d), as subsections (n) and (o), 
     respectively,
       (B) by redesignating paragraph (8) of subsection (f), as 
     redesignated by subsection (a)(2), as subsection (m), and
       (C) by moving such subsection to the position immediately 
     after subsection (l).
       (2) Clerical and conforming amendments.--
       (A) The heading of subsection (m) of section 305 of such 
     Act (29 U.S.C. 1085), as redesignated by paragraph (1), is 
     amended to read as follows:
       ``(m) Adjustment of Benefits.--''.
       (B) The following provisions of such subsection (m) are 
     amended as follows:
       (i) Subparagraphs (A), (B), and (C) are redesignated as 
     paragraphs (1), (2), and (4), respectively, and moved 2 ems 
     to the left.
       (ii) Clauses (i), (ii), (iii), and (iv) of paragraph (1) 
     (as so redesignated) are redesignated as subparagraphs (A), 
     (B), (C), and (D), respectively, and moved 2 ems to the left.
       (iii) Subclauses (I), (II), and (III) of paragraph (1)(D) 
     (as so redesignated) are redesignated as clauses (i), (ii), 
     and (iii), respectively, and moved 2 ems to the left.
       (iv) Clauses (i), (ii), and (iii) of paragraph (4) (as so 
     redesignated) are redesignated as subparagraphs (A), (B), and 
     (C), respectively, and moved 2 ems to the left, and the flush 
     sentence at the end of subparagraph (C) (as so redesignated) 
     is moved 2 ems to the left.
       (v) Subclauses (I), (II), and (III) of paragraph (4)(A) (as 
     so redesignated) are redesignated as clauses (i), (ii), and 
     (iii), respectively, and moved 2 ems to the left.
       (vi) Subclauses (I) and (II) of paragraph (4)(B) (as so 
     redesignated) are redesignated as clauses (i) and (ii), 
     respectively, and moved 2 ems to the left.
       (vii) Subclauses (I), (II), and (III) of paragraph (4)(C) 
     (as so redesignated) are redesignated as clauses (i), (ii), 
     and (iii), respectively, and moved 2 ems to the left.
       (viii) Paragraph (1)(A), as so redesignated, is amended by 
     striking ``subparagraph (C)'' and inserting ``paragraph 
     (4)''.
       (ix) Paragraph (1)(B), as so redesignated, is amended by 
     striking ``clause (iv)(III)'' and inserting ``subparagraph 
     (D)(iii)''.
       (x) Paragraph (1)(D), as so redesignated, is amended by 
     striking ``this paragraph'' and inserting ``this 
     subsection''.
       (xi) Paragraph (2), as so redesignated, is amended--

       (I) by striking ``subparagraph (A)(iv)(III)'' and inserting 
     ``paragraph (1)(D)(iii)'', and
       (II) by striking ``this paragraph'' and inserting ``this 
     subsection''.

       (xii) Paragraph (4)(A), as so redesignated, is amended by 
     striking ``subparagraph (A)'' and inserting ``paragraph 
     (1)''.
       (xiii) Paragraphs (4)(B) and (4)(C), as so redesignated, 
     are each amended by striking ``clause (i)'' each place it 
     appears and inserting ``subparagraph (A)''.
       (xiv) The last sentence of paragraph (4)(C), as so 
     redesignated, is amended--

       (I) by striking ``subclause (I)'' and inserting ``clause 
     (i)'', and
       (II) by striking ``this subparagraph'' and inserting ``this 
     paragraph''.

       (3) Application to all plans in endangered, critical, or 
     declining status.--
       (A) In general.--Subparagraph (A) of section 305(m)(1) of 
     such Act (29 U.S.C. 1085(m)(1)), as redesignated and amended 
     by this section, is further amended--
       (i) by striking ``the plan sponsor shall'' and inserting 
     ``the plan sponsor of a multiemployer plan in endangered, 
     critical, or declining status may'', and
       (ii) by striking ``paragraph (1)(B)(i)'' and inserting 
     ``subsection (d)(1)(B), (f)(1)(B), or (h)(1)(B), whichever is 
     applicable''.
       (B) Conforming amendments.--Subparagraph (B) of section 
     305(m)(1) of such Act (29 U.S.C. 1085(m)(1)), as redesignated 
     and amended by this section, is further amended by striking 
     ``critical'' both places it appears and inserting 
     ``endangered, critical, or declining''.
       (4) Additional adjustable benefits.--
       (A) In general.--Subparagraph (D) of section 305(m)(1) of 
     such Act (29 U.S.C. 1085(m)(1)), as redesignated by this 
     section, is amended--
       (i) by inserting ``, including early reduction factors 
     which are not provided on an actuarially equivalent basis,'' 
     after ``(i))'' in clause (ii), as so redesignated,
       (ii) by striking ``and'' at the end of clause (ii) (as so 
     redesignated),
       (iii) by striking ``that would not be eligible'' and all 
     that follows through the period in clause (iii) (as so 
     redesignated) and inserting ``which were adopted (or, if 
     later, took effect) less than 120 months before the first day 
     of the first plan year in which the plan was in endangered, 
     critical, or declining status,'', and
       (iv) by adding at the end the following new clauses:
       ``(iv) any one-time bonus payment or `thirteenth check' 
     provision, and
       ``(v) benefits granted for periods of service prior to 
     participation in the plan.''.
       (B) Conforming amendments.--
       (i) Subparagraph (B) of section 305(m)(1) of such Act (29 
     U.S.C. 1085), as redesignated and amended by this section, is 
     further amended by striking ``subparagraph (D)(iii)'' and 
     inserting ``clause (iii), (iv), or (v) of subparagraph (D)''.
       (ii) Paragraph (2) of section 305(m) of such Act (29 U.S.C. 
     1085), as amended by paragraph (2)(B), is further amended by 
     striking ``paragraph (1)(D)(iii)'' and inserting ``clause 
     (iii), (iv), or (v) of paragraph (1)(D)''.
       (iii) Section 4233A(o)(1) of such Act, as added by this Act 
     and as amended by this section, is further amended by 
     striking ``305(m)(2)'' and inserting ``305(n)(2)''.
       (5) Rules relating to suspension of benefits upon return to 
     work.--Subsection (m) of section 305 of such Act (29 U.S.C. 
     1085), as redesignated and amended by this section, is 
     further amended by inserting after paragraph (2) the 
     following new paragraph:
       ``(3) Rules relating to suspension of benefits upon return 
     to work.--The plan sponsor of a multiemployer plan in 
     endangered, critical, or declining status may amend rules 
     regarding the suspension of a participant's benefits upon a 
     return to work after commencement of benefits, or the 
     commencement of benefits after normal retirement age 
     (including in the case of continued employment after normal 
     retirement age). Any such changes shall apply only to future 
     payments of benefits.''.
       (6) Additional conforming amendments.--
       (A) Clause (iii) of section 305(b)(5)(D) of such Act (29 
     U.S.C. 1085(b)(5)(D)), as redesignated and amended by this 
     section, is further amended--
       (i) by striking ``critical'' in the heading and inserting 
     ``endangered, critical, or declining'',
       (ii) by striking ``critical status'' both places it appears 
     and inserting ``endangered, critical, or declining status'', 
     and
       (iii) by striking ``subsection (f)(8)'' in subclause (I) 
     and inserting ``subsection (m)(1)(D)''.
       (B) Subsection (j) of section 305 of such Act (29 U.S.C. 
     1085), as amended by subsection (d), is further amended by 
     striking ``(f)(8), (g), or (i)'' and inserting ``(e), (g), 
     (i), or (m)''.
       (C) Section 101(f)(2)(B) of such Act (29 U.S.C. 
     1021(f)(2)(B)), as amended by this section, is amended--
       (i) by striking ``305(m)'' in clause (i)(II) and inserting 
     ``305(n)'', and
       (ii) by striking ``305(m)(8)'' in clause (ii)(II) and 
     inserting ``305(n)(8)''.
       (D) Section 103(f)(1)(B)(ii) of such Act (29 U.S.C. 
     1023(f)(1)(B)(ii)), as amended by this section, is amended by 
     striking ``305(m)(2)'' and inserting ``305(n)(2)''.
       (f) Elections to Be in Critical or Endangered Status.--
       (1) In general.--Paragraph (6) of section 305(b) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1085(b)), as redesignated and amended by this section, is 
     further amended--
       (A) by striking ``is not in critical status'' in 
     subparagraph (A) and inserting ``is not in critical or 
     declining status'',
       (B) by striking ``but that is projected'' in subparagraph 
     (A) and inserting ``but--
       ``(i) that is projected'',
       (C) by striking ``5 plan years may, not later than'' in 
     subparagraph (A) and inserting ``5 plan years, or
       ``(ii) that is in endangered status and is not reasonably 
     projected to be able to emerge from endangered status within 
     the funding improvement period under the funding improvement 
     plan in effect,
     may, not later than'', and
       (D) by striking ``under paragraph (3)'' in subparagraph (B) 
     and inserting ``under paragraph (3) or for endangered status 
     under paragraph (2)''.
       (2) Election to be in endangered status.--Subsection (b) of 
     section 305 of such Act (29 U.S.C. 1085), as so redesignated 
     and amended, is further amended by adding at the end the 
     following new paragraph:
       ``(8) Election to be in endangered status.--Notwithstanding 
     paragraph (2)--
       ``(A) the plan sponsor of a multiemployer plan that is not 
     in endangered, critical, or declining status for a plan year 
     but that is projected by the plan actuary, pursuant to the 
     determination under paragraph (5), to be in endangered status 
     in any of the 5 succeeding plan years, may, not later than 30 
     days after the date of the certification under paragraph 
     (5)(A), elect to be in endangered status effective for the 
     current plan year,
       ``(B) the plan year in which the plan sponsor elects to be 
     in endangered status under subparagraph (A) shall be treated 
     for purposes of this section as the first year in which the 
     plan is in endangered status, regardless of the date on which 
     the plan first satisfies the criteria for endangered status 
     under paragraph (2), and
       ``(C) a plan that is in endangered status under this 
     paragraph shall not emerge from endangered status unless the 
     plan's actuary certifies under paragraph (5)(A) that the plan 
     is no longer in endangered status and is not in critical or 
     declining status.''.
       (g) Amendments Relating to Funding Improvement Plan.--
       (1) In general.--Paragraph (1) of section 305(d) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1085(d)), as redesignated and amended by this section, is 
     further amended--
       (A) by striking the last sentence, and
       (B) in subparagraph (B), by striking ``funding improvement 
     plan--'' and all that follows and inserting ``funding 
     improvement plan, shall provide to the bargaining parties 1 
     or more schedules showing revised benefit structures, revised 
     contribution structures, or both, which, if adopted, may 
     reasonably be expected to enable the multiemployer plan to 
     meet the requirements of paragraph (3), including--
       ``(i) one default proposal under which--

[[Page S7613]]

       ``(I) all adjustable benefits in the form of early 
     retirement subsidies (including early reduction factors which 
     are not provided on an actuarially equivalent basis) under 
     the plan are eliminated, and
       ``(II) the future monthly benefit accrual rate under the 
     plan is reduced to the equivalent of 1 percent of annual 
     contributions (or, if lower, the accrual rate as of the date 
     of the enactment of the Chris Allen Multiemployer Pension 
     Recapitalization and Reform Act of 2020) based on the 
     contribution rate in effect as of the first day of the plan 
     year in which the plan enters endangered status, and

     which may also include reduction or elimination of any other 
     adjustable benefits under the plan, and
       ``(ii) any additional schedules which reduce or eliminate 
     adjustable benefits under the plan which the plan sponsor 
     deems appropriate to provide as an alternative to the default 
     proposal.''.
       (2) Funding improvement plan.--Paragraph (3) of section 
     305(d) of such Act (29 U.S.C. 1085(d)), as so redesignated 
     and amended, is further amended--
       (A) by striking ``For purposes of this section--'' and all 
     that follows through ``which consists of'' in subparagraph 
     (A) and inserting ``For purposes of this section, a funding 
     improvement plan is a plan which consists of'', and
       (B) by striking ``formulated to provide'' and all that 
     follows and inserting ``formulated, based on reasonably 
     anticipated experience and reasonable actuarial assumptions, 
     to--
       ``(A) enable the plan to emerge from endangered status by 
     the end of the funding improvement period, and
       ``(B) avoid any accumulated funding deficiencies during the 
     funding improvement period (taking into account any extension 
     of amortization periods under section 304(d)).''.
       (3) Funding improvement period.--Paragraph (4) of section 
     305(d) of such Act (29 U.S.C. 1085(d)(4)), as so redesignated 
     and amended, is further amended by striking subparagraph (B) 
     and inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) New period based on adverse experience.--
       ``(i) In general.--If the plan's actuary determines 
     necessary based on adverse plan experience, the plan sponsor 
     may provide for a new 10-year period as of the first day of 
     any plan year in the original funding improvement period, but 
     only if the plan is still projected to meet the requirements 
     of the funding improvement plan and emerge from endangered 
     status at the end of the new funding improvement period.
       ``(ii) Limitation.--A plan sponsor may provide a new 10-
     year period under clause (i) not more than 1 time in any 20-
     consecutive-year period, unless the plan sponsor submits to 
     the Secretary an application for an additional new period. 
     Such application shall include a certification that the plan 
     is projected to emerge from endangered status in the proposed 
     new 10-year period and a description of key assumptions, to 
     be specified in regulations promulgated by the Secretary in 
     consultation with the Pension Benefit Guaranty 
     Corporation.''.
       (4) Conforming amendments.--
       (A) Subparagraph (C) of section 305(d)(4) of such Act (29 
     U.S.C. 1085(d)(4)), as so redesignated and amended, is 
     further amended--
       (i) by striking ``critical status'' both places it appears 
     in clauses (i) and (ii) and inserting ``critical or declining 
     status'',
       (ii) by striking ``rehabilitation period'' in clause (ii) 
     and inserting ``rehabilitation or solvency attainment 
     period'', and
       (iii) by striking ``critical status'' in the heading of 
     clause (ii) and inserting ``critical or declining status''.
       (B) Subsection (d) of section 305 of such Act (29 U.S.C. 
     1085), as so redesignated and amended, is further amended by 
     striking paragraph (5) and by redesignating paragraphs (6), 
     (7), and (8) as paragraphs (5), (6), and (7), respectively.
       (C) Paragraph (6) of section 305(d) of such Act (29 U.S.C. 
     1085(d)), as so redesignated, is amended--
       (i) by striking ``(1)(B)(i)(I)'' in subparagraph (A) and 
     inserting ``(1)(B)(i)'', and
       (ii) by striking ``paragraph (6)(B)'' in subparagraph 
     (B)(ii) and inserting ``paragraph (5)(B)''.
       (D) Paragraph (2) of section 305(d) of such Act (29 U.S.C. 
     1085(d)), as so redesignated, is amended by inserting ``, 
     except that the next update of the funding improvement plan 
     shall fulfill the requirement of paragraph (1)(B)(i)'' after 
     ``for a preceding plan year''.
       (h) Amendments Relating to Rehabilitation Plan.--
       (1) In general.--Paragraph (1) of section 305(f) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1085(f)), as redesignated and amended by this section, is 
     further amended--
       (A) by striking the last 2 sentences, and
       (B) in subparagraph (B), by striking ``rehabilitation 
     plan--'' and all that follows and inserting ``rehabilitation 
     plan, shall provide to the bargaining parties 1 or more 
     schedules showing revised benefit structures, revised 
     contribution structures, or both, which, if adopted, may 
     reasonably be expected to enable the multiemployer plan to 
     meet the requirements of paragraph (3), including--
       ``(i) one default proposal under which--

       ``(I) all adjustable benefits in the form of early 
     retirement subsidies (including early reduction factors which 
     are not provided on an actuarially equivalent basis) under 
     the plan are eliminated, and
       ``(II) the future monthly benefit accrual rate under the 
     plan is reduced to the equivalent of 1 percent of annual 
     contributions (or, if lower, the accrual rate as of the date 
     of the enactment of the Chris Allen Multiemployer Pension 
     Recapitalization and Reform Act of 2020) based on the 
     contribution rate in effect as of the first day of the plan 
     year in which the plan enters critical status, and

     which may also include reduction or elimination of any other 
     adjustable benefits under the plan, and
       ``(ii) any additional schedules which reduce or eliminate 
     adjustable benefits under the plan which the plan sponsor 
     deems appropriate to provide as an alternative to the default 
     proposal.
     In the case of a plan adopting a rehabilitation plan 
     described in paragraph (3)(A)(ii), no schedule provided to or 
     adopted by the bargaining parties shall provide for a monthly 
     benefit accrual rate in excess of the rate described in 
     subparagraph (B)(i)(II).''.
       (2) Rehabilitation plan.--
       (A) In general.--Subparagraph (A) of section 305(f)(3) of 
     such Act (29 U.S.C. 1085(f)(3)), as so redesignated, is 
     amended--
       (i) by striking ``and may include'' and all that follows 
     through ``such actions'' in clause (i),
       (ii) by inserting ``, while delaying insolvency for as long 
     as possible and maximizing the income of the plan, including 
     income after insolvency'' before the period in clause (ii), 
     and
       (iii) by striking ``(1)(B)(i)'' in the last sentence and 
     inserting ``(1)(B)''.
       (B) Conforming amendments.--Clause (i) of section 
     305(f)(3)(C) of such Act (29 U.S.C. 1085(f)(3)(C)), as so 
     redesignated, is amended--
       (i) by striking ``(1)(B)(i)'' in subclause (II) and 
     inserting ``(1)(B)'', and
       (ii) by striking ``the last sentence of paragraph (1)'' and 
     inserting ``paragraph (1)(B)(i)''.
       (3) Rehabilitation period.--
       (A) In general.--Subparagraph (A) of section 305(f)(4) of 
     such Act (29 U.S.C. 1085(f)(4)), as so redesignated and 
     amended, is further amended--
       (i) by striking ``The rehabilitation period'' and inserting 
     ``Except as otherwise provided in this subparagraph, the 
     rehabilitation period'', and
       (ii) by adding at the end the following: ``If, upon 
     exhaustion of all reasonable measures, the plan is not 
     reasonably expected to emerge from critical status by the end 
     of such 10-year period, the rehabilitation period shall be 
     extended to take into account the projected date of emergence 
     from critical status (if the rehabilitation plan remained in 
     effect until such date) or the projected date of insolvency 
     (if applicable) (unless the plan enters declining status).''.
       (B) Emergence from critical status.--Subparagraph (B) of 
     section 305(f)(4) of such Act (29 U.S.C. 1085(f)(4)), as so 
     redesignated and amended, is further amended--
       (i) by inserting ``and is not in declining status,'' after 
     the comma in clause (i)(I),
       (ii) by striking subclause (III) of clause (i) and 
     inserting the following:

       ``(III) the plan's projected funded percentage as of the 
     first day of the 15th succeeding plan year is at least 100 
     percent and is projected to increase after such date.'',

       (iii) by striking ``that--'' and all that follows through 
     ``regardless of whether'' in clause (ii)(I) and inserting 
     ``that the plan meets the requirements of subclauses (II) and 
     (III) of clause (i), regardless of whether'', and
       (iv) by striking ``unless--'' and all that follows in 
     clause (ii)(II) and inserting ``unless, as of such plan year, 
     the plan fails to meet the requirements of subclause (II) or 
     (III) of clause (i).''.
       (4) Rules relating to benefit increases during 
     rehabilitation period.--Subparagraph (B) of section 305(g)(1) 
     of such Act (29 U.S.C. 1085(g)(1)), as so redesignated and 
     amended, is further amended by striking ``unless'' and all 
     that follows and inserting ``unless the amendment is required 
     as a condition of qualification under part I of subchapter D 
     of chapter 1 of the Internal Revenue Code of 1986 or to 
     comply with other applicable law, or the amendment provides 
     for only a de minimis increase in the liabilities of the 
     plan.''.
       (5) Conforming amendments.--
       (A) Paragraph (6) of section 305(f) of such Act (29 U.S.C. 
     1085(f)), as so redesignated, is amended by striking ``the 
     last sentence of paragraph (1)'' and inserting ``paragraph 
     (1)(B)(i)''.
       (B) Paragraph (2) of section 305(f) of such Act (29 U.S.C. 
     1085(f)), as so redesignated, is amended by inserting ``, 
     except that the next update of the rehabilitation plan shall 
     fulfill the requirement of paragraph (1)(B)(i)'' after ``for 
     a preceding plan year''.
       (i) Actuarial Assumptions.--
       (1) In general.--Subsection (n) of section 305 of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1085), as redesignated by subsections (a), (d), and (e), is 
     amended--
       (A) by striking ``Method'' in the heading and inserting 
     ``Method and Assumptions'', and
       (B) by adding at the end the following new paragraph:
       ``(11) Actuarial assumptions.--
       ``(A) In general.--The actuarial assumptions relied upon 
     for purposes of this section

[[Page S7614]]

     by a plan actuary shall be individually reasonable and, in 
     the aggregate, shall be reasonable and (with the exception of 
     assumptions regarding future contributions) represent the 
     actuary's best estimate of future plan experience, within 
     limitations prescribed by the Secretary of the Treasury. A 
     plan actuary shall avoid conservatism or optimism in 
     individual assumptions to the extent that they would result 
     in a set of assumptions that is unreasonable in the 
     aggregate.
       ``(B) Investment returns.--The investment return assumption 
     for projecting plan assets may differ from the actuarial 
     valuation interest rate. In selecting the investment return 
     assumption for projecting plan assets, the plan actuary shall 
     estimate the expected return of the plan's investments as 
     currently invested and as expected to be invested in the 
     future, consistent with the plan's adopted investment policy, 
     if applicable. It is reasonable for an actuary to expect that 
     the plan's investment decisions will consider risk, expected 
     returns over time, and expected future benefit payments. The 
     investment return assumption shall not exceed the interest 
     rate used to determine past service liability under section 
     431(b)(6).
       ``(C) Contributions.--
       ``(i) In general.--The plan actuary shall develop 
     assumptions for the projection of future contributions, 
     including assumptions regarding industry activity among 
     contributing employers and contribution rates, based on 
     information provided by the plan sponsor, which must act 
     reasonably and in good faith. The plan actuary shall certify 
     the reasonableness of all assumptions.
       ``(ii) Projected industry activity.--Any projection of 
     activity in the industry or industries covered by the plan, 
     including future covered employment and contribution levels, 
     shall be based on information provided by the plan sponsor 
     acting reasonably and in good faith.
       ``(iii) Future contribution base units.--

       ``(I) Declining contribution base units.--If recent 
     experience of the plan has been declining contribution base 
     units, the plan actuary may assume future contribution base 
     units will continue to decline at the same annualized trend 
     as over the 5 immediately preceding plan years, unless the 
     actuary determines that there have been significant changes 
     that would make such assumption unreasonable.
       ``(II) Flat or increasing contribution base units.--If 
     recent experience of the plan has been increasing, or neither 
     increasing nor decreasing, contribution base units, the plan 
     actuary may assume future contribution base units will remain 
     unchanged indefinitely, unless the actuary determines that 
     there have been significant changes that would make such 
     assumption unreasonable.

       ``(iv) Future contribution rates.--

       ``(I) In general.--Projections of contributions shall be 
     based on the contribution rates consistent with the terms of 
     collective bargaining and participation agreements currently 
     in effect.
       ``(II) Future increases in accordance with correction 
     plans.--If reasonable and applicable, the plan actuary may 
     assume future increases in contribution rates consistent with 
     the adopted funding improvement plan, rehabilitation plan, or 
     solvency plan.
       ``(III) Additional factors.--Information provided by the 
     plan sponsor to the plan actuary in setting the assumption 
     regarding future increases in contribution rates shall take 
     into account the ability of the participating employers to 
     make contributions at the scheduled rates over time, 
     considering relevant factors such as projected industry 
     activity, the financial strength of participating employers, 
     market competition, and the scheduled contribution rate to 
     the plan relative to the overall wage package.

       ``(D) Assumptions for developing schedules.--All schedules 
     under any funding improvement plan, rehabilitation plan, or 
     solvency plan must be developed based on the same set of 
     actuarial assumptions unless it would be unreasonable to do 
     so, taking into account the anticipated impact of the 
     schedules on participant behavior and employer 
     participation.''.
       (2) Additions to form 5500 schedule mb.--Subparagraph (B) 
     of section 305(b)(5) of such Act (29 U.S.C. 1085(b)(5)), as 
     redesignated and amended by this section, is further amended 
     by adding at the end the following new clause:
       ``(vi) Additional attachments.--The plan actuary shall 
     attach to the certification required under subparagraph (A)--

       ``(I) documentation supporting the certification of status 
     under subparagraph (A)(i), including projections of the 
     funding standard account, funded percentage, and solvency of 
     the plan,
       ``(II) a clear description of the key assumptions used in 
     performing the projections, including investment returns, 
     contribution base units, and contribution rates,
       ``(III) a 5-year history of contributions, including 
     contribution base units, average contribution rates, and 
     withdrawal liability payments, and a comparison of such 
     contribution base units, rates, and payments to projections 
     made by the plan, and
       ``(IV) an alternate projection of the funding standard 
     account, funded percentage, and solvency, based on the 
     following assumptions:

       ``(aa) Annual future investment returns on plan assets 
     equal the actuarial interest rate assumption minus 1 percent.
       ``(bb) Future contribution base units projected using a 
     trend equal to the lesser of--
       ``(AA) the annualized trend of actual contribution base 
     units over the 5 preceding plan years, and
       ``(BB) no change in future contribution base units.
       ``(cc) No increases in future contribution rates beyond 
     those consistent with the collective bargaining agreements 
     and participation agreements in effect for the plan year.
       ``(dd) The withdrawal from the plan of the employer which 
     has contributed the greatest total amount of contributions 
     over the 5 preceding plan years, if such employer has 
     contributed at least 10 percent of the total contributions to 
     the plan over such 5 plan years and such employer has a below 
     investment grade credit rating (but only if obtaining the 
     credit rating of such employer is not an undue burden).
       ``(ee) If such credit rating cannot be obtained without 
     undue burden, the withdrawal of the employer which has 
     contributed the greatest total amount of contributions over 
     the 5 preceding plan years, if such employer has contributed 
     at least 10 percent of the total contributions to the plan 
     over such 5 plan years without regard to collection of any 
     withdrawal liability.
       ``(ff) If no employer has contributed at least 10 percent 
     of the total contributions to the plan over the 5 preceding 
     plan years, the withdrawal of the employer which contributed 
     the greatest total amount of contributions for the current 
     plan year, without regard to collection of any withdrawal 
     liability, unless the employer contributed less than 1 
     percent of the total contributions to the plan for such plan 
     year.
       ``(gg) Other assumptions consistent with the projection 
     based on the actuary's best estimate assumptions.''.
       (3) Conforming amendments.--
       (A) Section 305(b)(5)(B)(i) of such Act (29 U.S.C. 
     1085(b)(5)(B)(i)), as redesignated by this section, is 
     amended by striking ``assumptions'' and inserting 
     ``assumptions meeting the requirements of subsection 
     (n)(11)''.
       (B) Section 305(b)(5)(A)(vi) of such Act (29 U.S.C. 
     1085(b)(5)(A)(vi), as amended by this section and section 
     321, is further amended by striking ``reasonable actuarial 
     assumptions'' and inserting ``assumptions meeting the 
     requirements of subsection (n)(11)''.
       (C) Paragraph (3) of section 305(d) of such Act (29 U.S.C. 
     1085(d)), as amended by subsection (g), is further amended by 
     striking ``reasonable actuarial assumptions'' and inserting 
     ``assumptions meeting the requirements of subsection 
     (n)(11)''.
       (D) Clause (i) of section 305(f)(3)(A) of such Act (29 
     U.S.C. 1085(f)(3)(A)), as amended by subsection (h), is 
     further amended by striking ``reasonable actuarial 
     assumptions'' and inserting ``assumptions meeting the 
     requirements of subsection (n)(11)''.
       (E) Section 305(h)(3) of such Act (29 U.S.C. 1085(h)(3)), 
     as added by subsection (d), is amended by striking 
     ``reasonable actuarial assumptions'' and inserting 
     ``assumptions meeting the requirements of subsection 
     (n)(11)''.
       (j) Conforming Amendments Relating to Premiums.--Paragraph 
     (10) of section 4006(a) of such Act (29 U.S.C. 1306(a)), as 
     added by this Act, is amended--
       (1) by striking ``305(b)(7)'' in subparagraph (B)(iii) 
     thereof and inserting ``305(b)(4)'',
       (2) by striking ``critical and declining'' in subparagraph 
     (B)(iii) thereof and inserting ``declining'', and
       (3) by striking ``305(f)(9)'' in subparagraph (C) and 
     inserting ``305(h)(8)''.
       (k) Conforming Amendments Relating to Composite and Legacy 
     Plans.--
       (1) Sections 203(a)(3)(E)(ii), 204(b)(1)(B)(i), 
     204(b)(1)(H)(v), and 204(g)(1) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1053(a)(3)(E)(ii), 
     1054(b)(1)(B)(i), 1054(b)(1)(H)(v), and 1054(g)(1)), as 
     amended by title V, are each further amended by striking 
     ``305(f)'' each place it appears and inserting ``305(h)(8)''.
       (2) Sections 304(b)(10), 805(d)(2)(D), and 805(d)(4) of 
     such Act, as added by title V, are each amended by striking 
     ``endangered or critical'' and inserting ``endangered, 
     critical, or declining''.
       (3) Section 801(b)(1) of such Act, as so added, is amended 
     by striking ``endangered or critical'' both places it appears 
     and inserting ``endangered, critical, or declining''.
       (4) Sections 801(b)(1), 801(b)(5)(B), 805(b)(1)(A), and 
     805(e)(3) of such Act, as so added, are each amended by 
     striking ``305(b)(4)'' and inserting ``305(b)(5)''.
       (5) Sections 801(b)(5)(B) and 805(b)(1)(A) of such Act, as 
     so added, are each amended by striking ``endangered or 
     critical'' and inserting ``endangered, critical, or 
     declining''.
       (6) Section 802(b)(1) of such Act, as so added, is amended 
     by striking ``and'' at the end of subparagraph (B), by 
     striking the period at the end of subparagraph (C) and 
     inserting ``; and'', and by adding at the end the following 
     new subparagraph:
       ``(D) consistent with the principles of subparagraphs (B), 
     (C), and (D) of section 305(n)(11).''.
       (7) Sections 802(b)(5) and 805(d)(2)(A) of such Act, as so 
     added, are each amended by striking ``305(b)(4)(B)'' and 
     inserting ``305(b)(5)(B)''.
       (8) Section 803(a)(2)(D) of such Act, as so added, is 
     amended by striking ``305(f)(9)(D)(vi)'' and inserting 
     ``305(h)(8)(D)(vi)''.
       (9) Section 803(a)(3) of such Act, as so added, is amended 
     by striking ``305(f)(8)'' and inserting ``305(m)(1)(D)''.

[[Page S7615]]

       (10) Section 805(d)(2)(D) of such Act, as so added and 
     amended, is further amended by striking ``funding improvement 
     or rehabilitation plan'' and inserting ``funding improvement, 
     rehabilitation, or solvency plan''.
       (l) Additional Conforming Amendments.--
       (1) Section 502(c) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1132(c)) is amended--
       (A) in paragraph (7)(B), as added by section 322, by 
     striking ``305(b)(4)(D)'' and inserting ``305(b)(5)(D)'', and
       (B) in paragraph (14), as so added and as redesignated by 
     section 501--
       (i) by striking ``305(b)(4)(D)'' in subparagraph (A) and 
     inserting ``305(b)(5)(D)'', and
       (ii) by striking ``305(b)(4)'' in subparagraph (B) and 
     inserting ``305(b)(5)''.
       (2) Section 4003(g) of such Act (29 U.S.C. 1303(g)), as 
     added by section 321, is amended by striking ``section 
     305(b)(4)(A)'' and inserting ``section 305(b)(5)(A)''.
       (3) Section 4042(b)(2)(B)(i) of such Act (29 U.S.C. 
     1342(b)(2)(B)), as added by section 301, is amended--
       (A) by striking ``critical and declining'' and inserting 
     ``declining'', and
       (B) by striking ``(7)'' and inserting ``(4)''.
       (m) Effective Date.--Except as otherwise provided in 
     subsection (a)(7), the amendments made by this section shall 
     apply to plan years beginning after December 31, 2020.
       (n) Credit Ratings.--No requirement of section 939 or 939A 
     of the Dodd-Frank Wall Street Reform and Consumer Protection 
     Act (124 Stat. 1887; 15 U.S.C. 78o-7 note) shall apply with 
     respect to the amendment made by subsection (i)(2).

     SEC. 213. TRANSITION RULES.

       (a) Plans in Endangered Status.--
       (1) In general.--In the case of a multiemployer plan which 
     is in endangered status as of the date of the enactment of 
     this Act, and is on schedule as of such date to meet the 
     applicable benchmarks in accordance with the plan's funding 
     improvement plan--
       (A) Election to apply law before amendment.--The plan 
     sponsor may elect to remain in endangered status and to apply 
     section 432 of the Internal Revenue Code of 1986 and section 
     305 of the Employee Retirement Income Security Act of 1974 
     (29 U.S.C. 1085) as in effect before January 1, 2021, to the 
     plan, but only if the plan continues to meet such applicable 
     benchmarks.
       (B) Transitional effective date.--If the plan sponsor does 
     not make the election under paragraph (1)--
       (i) section 432 of such Code and section 305 of such Act as 
     in effect on January 1, 2021, shall apply to such plan as of 
     the first day of the first plan year beginning after December 
     31, 2020, and
       (ii) section 432(d)(1)(B)(i)(II) of such Code and section 
     305(d)(1)(B)(i)(II) of such Act, as amended by sections 
     211(g) and 212(g), respectively, shall each apply to such 
     plan by substituting ``the date of the enactment of the Chris 
     Allen Multiemployer Pension Recapitalization and Reform Act 
     of 2020'' for ``the first day of the plan year in which the 
     plan enters endangered status''.
     In the case of any plan with respect to which the plan 
     sponsor makes the election under subparagraph (A) but which 
     fails to continue to meet the applicable benchmarks under the 
     funding improvement plan, this subparagraph shall apply to 
     such plan by substituting ``the plan year after the first 
     plan year for which the plan fails to meet the applicable 
     benchmarks'' for ``the first plan year beginning after 
     December 31, 2020''.
       (2) Plans entering endangered status between enactment and 
     january 1, 2021.--In the case of a multiemployer plan which 
     enters endangered status after the date of the enactment of 
     this Act and before January 1, 2021--
       (A) section 432 of such Code and section 305 of such Act as 
     in effect on January 1, 2021, shall apply to such plan as if 
     already in effect, and
       (i) section 432(d)(1)(B)(i)(II) of such Code and section 
     305(d)(1)(B)(i)(II) of such Act, as amended by sections 
     211(g) and 212(g), respectively, shall each apply to such 
     plan by substituting ``the date of the enactment of the Chris 
     Allen Multiemployer Pension Recapitalization and Reform Act 
     of 2020'' for ``the first day of the plan year in which the 
     plan enters endangered status''.
       (b) Plans in Critical or Critical and Declining Status.--
       (1) In general.--In the case of a qualified critical 
     multiemployer plan--
       (A) Election to apply law before amendment.--The plan 
     sponsor may elect to remain in critical or critical and 
     declining status and to apply section 432 of the Internal 
     Revenue Code of 1986 and section 305 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1085) as in 
     effect before January 1, 2021, to the plan, but only if the 
     plan continues to make scheduled progress under the plan's 
     rehabilitation plan.
       (B) Transitional effective date.--If the plan sponsor does 
     not make the election under paragraph (1)--
       (i) section 432 of such Code and section 305 of such Act as 
     in effect on January 1, 2021, shall apply to such plan as of 
     the first day of the first plan year beginning after December 
     31, 2020,
       (ii) section 432(f)(1)(B)(i)(II) of such Code and section 
     305(f)(1)(B)(i)(II) of such Act, as amended by sections 
     211(h) and 212(h), respectively, shall each apply to such 
     plan by substituting ``the date of the enactment of the Chris 
     Allen Multiemployer Pension Recapitalization and Reform Act 
     of 2020'' for ``the first day of the plan year in which the 
     plan enters critical status'', and
       (iii) section 432(h)(1)(B)(i)(II) of such Code and section 
     305(h)(1)(B)(i)(II) of such Act, as amended by sections 
     211(d)(3) and 212(d)(3), respectively, shall each apply to 
     such plan by substituting ``the date of the enactment of the 
     Chris Allen Multiemployer Pension Recapitalization and Reform 
     Act of 2020'' for ``the first day of the plan year in which 
     the plan enters declining status''.
     In the case of any plan with respect to which the plan 
     sponsor makes the election under subparagraph (A) but which 
     fails to continue to make scheduled progress under the 
     rehabilitation plan, this subparagraph shall apply to such 
     plan by substituting ``the plan year after the first plan 
     year for which the plan fails to make scheduled progress 
     under the rehabilitation plan'' for ``the first plan year 
     beginning after December 31, 2020''.
       (C) Application of premium amendments.--A plan with respect 
     to which the plan sponsor makes the election under 
     subparagraph (A) shall be treated as described in clause 
     (iii) of section 4006(a)(10)(B) of the Employee Retirement 
     Income Security Act of 1974 until such time as the plan 
     emerges from critical and declining status pursuant to 
     section 432 of such Code and section 305 of such Act as in 
     effect before January 1, 2021.
       (2) Plans entering critical or critical and declining 
     status between enactment and january 1, 2021.--In the case of 
     a multiemployer plan which enters critical or critical and 
     declining status after the date of the enactment of this Act 
     and before January 1, 2021--
       (A) section 432 of such Code and section 305 of such Act as 
     in effect on January 1, 2021, shall apply to such plan as if 
     already in effect,
       (B) section 432(f)(1)(B)(i)(II) of such Code and section 
     305(f)(1)(B)(i)(II) of such Act, as amended by sections 
     211(h) and 212(h), respectively, shall each apply to such 
     plan by substituting ``the date of the enactment of the Chris 
     Allen Multiemployer Pension Recapitalization and Reform Act 
     of 2020'' for ``the first day of the plan year in which the 
     plan enters critical status'', and
       (C) section 432(h)(1)(B)(i)(II) of such Code and section 
     305(h)(1)(B)(i)(II) of such Act, as amended by sections 
     211(d)(3) and 212(d)(3), respectively, shall each apply to 
     such plan by substituting ``the date of the enactment of the 
     Chris Allen Multiemployer Pension Recapitalization and Reform 
     Act of 2020'' for ``the first day of the plan year in which 
     the plan enters declining status''.
       (3) Qualified critical multiemployer plan.--For purposes of 
     this subsection, the term ``qualified critical multiemployer 
     plan'' means a multiemployer plan which is in critical or 
     critical and declining status as of the date of the enactment 
     of this Act, and is making scheduled progress under the 
     plan's rehabilitation plan, but only if the rehabilitation 
     plan (as in effect without regard to the amendments made by 
     this Act) targets emergence from critical status not later 
     than 3 years after the end of the rehabilitation period as in 
     effect with respect to such plan on the date of the enactment 
     of this Act.
       (c) Election.--
       (1) In general.--An election under subsection (a)(1)(A) or 
     (b)(1)(A) shall be made--
       (A) by notice to the Secretary of the Treasury and the 
     Pension Benefit Guaranty Corporation, in such manner as the 
     Secretary of the Treasury may prescribe,
       (B) not later than the due date for the notice of 
     endangered status or critical status for the first plan year 
     beginning after December 31, 2020.
       (2) Periods after election.--After making a timely election 
     under paragraph (1)--
       (A) the plan sponsor shall annually review and update (if 
     necessary) the plan's funding improvement plan or 
     rehabilitation plan, and
       (B) the plan actuary shall certify annually whether the 
     plan is making scheduled progress under the funding 
     improvement plan or rehabilitation plan.
       (d) Definitions.--Any term used in this section which is 
     also used in section 432 of the Internal Revenue Code of 1986 
     or section 305 of the Employee Retirement Income Security Act 
     of 1974 (before or after the amendments made by this Act) 
     shall have the same meaning as when used in such sections.

              PART II--PROVISIONS RELATING TO PLAN MERGERS

     SEC. 221. PROVISIONS RELATING TO PLAN MERGERS AND 
                   CONSOLIDATIONS.

       (a) In General.--Section 4231(c) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1411(c)) is amended--
       (1) by striking ``section 406(a) or section 406(b)(2)'' and 
     inserting ``section 404, 406(a), or 406(b)(2)'', and
       (2) by adding at the end the following: ``The corporation 
     shall prescribe safe harbor provisions whereby a merger of 
     multiemployer plans or the transfer of assets or liabilities 
     between multiemployer plans, where one of the plans is in 
     critical and declining status pursuant to section 305 and one 
     is in stable or unrestricted status pursuant to such section, 
     shall be deemed to satisfy the requirements of this section. 
     Notwithstanding the preceding sentences, the implementation 
     of such merger or transfer shall be subject to the rules of 
     section 404.''.
       (b) Calculation of Withdrawal Liability.--
       (1) In general.--Section 4231 of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1411) is amended by 
     adding at the end the following new subsection:
       ``(f) Calculation of Withdrawal Liability Post-merger.--The 
     corporation shall

[[Page S7616]]

     prescribe the methods and conditions under which employers 
     contributing to plans which are in stable or unrestricted 
     status under section 305 when such plan merges with a plan in 
     declining status under such section will not be allocated the 
     unfunded vested benefits of the plan in declining status (as 
     determined immediately before the merger).''.
       (2) Effective date.--The amendment made by this section 
     shall apply to plan mergers after December 31, 2020.

     SEC. 222. CLARIFICATION OF PBGC FINANCIAL ASSISTANCE FOR PLAN 
                   MERGERS AND PARTITIONS.

       (a) In General.--Paragraph (2) of section 4231(e) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1411(e)) is amended--
       (1) by striking the semicolon in subparagraph (B)(ii) and 
     inserting ``, determined solely with respect to the 
     liabilities and assets of the plan which was in critical and 
     declining status prior to the merger; and''; and
       (2) by striking subparagraph (C) and redesignating 
     subparagraph (D) as subparagraph (C).
       (b) Partitions.--Section 4233(b) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1413(b)) is amended by 
     striking paragraph (4), by adding ``and'' at the end of 
     paragraph (3)(B), and by redesignating paragraph (5) as 
     paragraph (4).
       (c) Conforming Amendment Relating to Status Changes.--
     Section 4231(e)(2)(B)(ii) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1411(e)(2)(B)(ii)), as 
     amended by subsection (a), is further amended by striking 
     ``critical and declining'' and inserting ``declining''.
       (d) Effective Dates.--
       (1) In general.--The amendments made by subsections (a) and 
     (b) shall apply to plan mergers and partitions taking effect 
     after the date of the enactment of this Act.
       (2) Conforming amendment.--The amendment made by subsection 
     (c) shall apply to plan mergers taking effect in plan years 
     beginning after December 31, 2020.

     SEC. 223. RESTORATION NOT REQUIRED FOR CERTAIN MERGERS.

       (a) Amendment of Internal Revenue Code of 1986.--Clause 
     (ii) of section 432(f)(9)(C) of the Internal Revenue Code of 
     1986, as redesignated by section 211(a) and as in effect 
     before the amendments made by section 211 other than 
     subsection (a) thereof, is amended by adding at the end the 
     following flush language:
     ``If, during the period of the benefit suspension, the plan 
     merges with a plan which is in stable or unrestricted status, 
     nothing in this clause shall be construed to require the plan 
     formed by the merger to restore the suspension of 
     benefits.''.
       (b) Amendment of ERISA.--Clause (ii) of section 
     305(f)(9)(C) of the Employee Retirement Income Security Act 
     of 1974 (29 U.S.C. 1085(f)(9)(C)), as redesignated by section 
     212(a) and as in effect before the amendments made by section 
     212 other than subsection (a) thereof, is amended by adding 
     at the end the following flush language:
     ``If, during the period of the benefit suspension, the plan 
     merges with a plan which is in stable or unrestricted status, 
     nothing in this clause shall be construed to require the plan 
     formed by the merger to restore the suspension of 
     benefits.''.
       (c) Effective Date.--The amendments made by subsections (a) 
     and (b) shall apply to plan mergers taking effect after the 
     date of the enactment of this Act.

                 PART III--WITHDRAWAL LIABILITY REFORM

     SEC. 231. WITHDRAWAL LIABILITY REFORM.

       (a) Withdrawal Liability Definition.--Section 4201(b)(1) of 
     the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1381(b)(1)) is amended to read as follows:
       ``(1) Determination of withdrawal liability.--
       ``(A) In general.--The withdrawal liability of an employer 
     to a plan is the applicable amount determined under 
     subparagraph (B), adjusted--
       ``(i) first, in the case of a partial withdrawal, in 
     accordance with section 4206;
       ``(ii) second, by any de minimis reduction applicable under 
     section 4209; and
       ``(iii) third, in accordance with section 4225.
       ``(B) Applicable amount.-- The applicable amount determined 
     under this subparagraph is the lesser of--
       ``(i) the amount determined under section 4211 to be the 
     allocable amount of unfunded vested benefits; or
       ``(ii) the present value of a series of 20 equal annual 
     payments in the amount determined with respect to the 
     employer under section 4219(c)(1)(C).
     In the case of an employer withdrawing from a multiemployer 
     plan described in subparagraph (C), clause (i) shall be 
     applied by substituting `25' for `20'.
       ``(C) Plans for which 25 payments required.--
       ``(i) In general.--A multiemployer plan is described in 
     this subparagraph if the plan--

       ``(I) is certified to be in declining status (or, for plan 
     years prior to 2021, in critical or declining status) for the 
     plan year in which the employer's withdrawal occurs; or
       ``(II) terminates as described in section 4041A(a) or 4042.

       ``(ii) Special rule for terminations.--Clause (i)(II) shall 
     apply to each employer who withdraws from a plan during a 
     period of 3 consecutive plan years that includes the 
     withdrawal of every employer from the plan, or the cessation 
     of the obligation of all employers to contribute under the 
     plan, as described in section 4041A(a)(2). For purposes of 
     this clause, withdrawal by an employer from a plan, during a 
     period of 3 consecutive plan years within which substantially 
     all the employers who have an obligation to contribute under 
     the plan withdraw, shall be presumed to be a withdrawal 
     pursuant to an agreement or arrangement, unless the employer 
     proves otherwise by a preponderance of the evidence.
       ``(D) Present value.--For purposes of subparagraph (B)(ii), 
     the present value of the annual payments shall be determined 
     based on the assumptions used for the most recent actuarial 
     valuation for the plan used to determine unfunded past 
     service liability for funding purposes.''.
       (b) De Minimis Rule.--Section 4209 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1389) is 
     amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1), by striking 
     ``unfunded vested benefits allocable under section 4211 to'' 
     and inserting ``applicable amount determined under section 
     4201(b)(1)(B) with respect to'';
       (B) in paragraph (2), by striking ``$50,000'' and inserting 
     ``$100,000''; and
       (C) in the flush text following paragraph (2)--
       (i) by striking ``the unfunded vested benefits'' and 
     inserting ``such applicable amount''; and
       (ii) by striking ``$100,000'' and inserting ``$200,000'';
       (2) in subsection (b)--
       (A) in the matter preceding paragraph (1), by striking 
     ``amount determined under section 4211'' and inserting 
     ``applicable amount determined under section 4201(b)(1)(B) 
     with respect to an employer'';
       (B) in paragraph (2)(B), by striking ``$100,000'' and 
     inserting ``$250,000''; and
       (C) in the flush text at the end--
       (i) by striking ``the amount determined under section 4211 
     for'' and inserting ``such applicable amount with respect 
     to''; and
       (ii) by striking ``$150,000'' and inserting ``$500,000''.
       (c) Payment of Withdrawal Liability.--Section 4219(c)(1) of 
     the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1399(c)(1)) is amended--
       (1) by striking so much of paragraph (1) as precedes 
     subparagraph (C) and inserting:
       ``(1)(A)(i) Subject to subparagraph (B), an employer shall 
     pay its liability determined under section 4201(b)(1) in 
     level annual payments determined under subparagraph (C) over 
     the applicable period of years determined under clause (ii), 
     calculated as if the first payment were made on the first day 
     of the plan year following the plan year in which the 
     withdrawal occurs and as if each subsequent payment were made 
     on the first day of each subsequent plan year. Actual payment 
     shall commence in accordance with paragraph (2).
       ``(ii) For purposes of clause (i), if the applicable amount 
     used under section 4201(b)(1)(A) is the amount determined--
       ``(I) under section 4201(b)(1)(B)(i), the applicable period 
     of years is the period of years necessary to amortize such 
     amount in level annual payments determined under subparagraph 
     (C), or
       ``(II) under section 4201(b)(1)(B)(ii), the applicable 
     period of years is 20 years (25 years if the plan is 
     described in section 4201(b)(1)(C)).
       ``(iii) For purposes of clause (ii)(I), the determination 
     of the amortization period described in clause (i) shall be 
     based on the assumptions used for the most recent actuarial 
     valuation for the plan to determine unfunded past service 
     liability for funding purposes.
       ``(B)(i) If any adjustment is required to the withdrawal 
     liability amount by reason of clause (i), (ii), or (iii) of 
     section 4210(b)(1)(A), modifications shall be made under 
     subparagraph (A) to reflect such adjustments in accordance 
     with this subparagraph and in such manner as the corporation 
     shall provide.
       ``(ii) In the case of a partial withdrawal described in 
     section 4205(a), the amount of each annual payment shall be 
     the product of--
       ``(I) the amount determined under subparagraph (C) 
     (determined without regard to this subparagraph), multiplied 
     by
       ``(II) the fraction determined under section 4206(a)(2).
       ``(iii) In the case of a de minimis reduction under section 
     4209, the period of years described in subparagraph 
     (A)(ii)(I) shall be adjusted so that the withdrawal liability 
     amount, as reduced under such section, is amortized in level 
     annual payments determined under subparagraph (C).''.
       (2) in subparagraph (C)--
       (A) in clause (i)(I)--
       (i) by striking ``3'' and inserting ``5''; and
       (ii) by striking ``10'' and inserting ``20''; and
       (B) by striking clause (iii);
       (3) by striking subparagraphs (D) and(E) and inserting the 
     following:
       ``(D)(i) In the case of a subsequent partial withdrawal or 
     a complete withdrawal that was preceded by one or more 
     partial withdrawals, the amount of the annual payment with 
     respect to the subsequent partial withdrawal or complete 
     withdrawal shall be reduced by the amounts of the payments 
     determined under subparagraph (B)(ii) with respect to each of 
     the preceding partial withdrawals.
       ``(ii) The amount of any reductions described in clause (i) 
     shall be phased out consistent with the method and period of 
     time being used by the plan to allocate unfunded vested 
     benefits under section 4211.

[[Page S7617]]

       ``(iii) The corporation may prescribe regulations as may be 
     necessary to provide for proper adjustments in the reduction 
     in the payment amount under clauses (i) and (ii).''.
       (d) Amendment of Plan.--Section 4211(c)(1) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1391(c)(1)) 
     is amended--
       (1) by inserting ``(A)'' after ``(c)(1)'',
       (2) by striking ``(b) or (d). A plan'' and inserting ``(b) 
     or (d).
       ``(B) A multiemployer plan'', and
       (3) by striking ``, to the extent provided'' and all that 
     follows and inserting ``to provide--
       ``(i) that the amount of the unfunded vested benefits 
     allocable to an employer that withdraws from the plan is an 
     amount determined under paragraph (5) of this subsection, 
     rather than under subsection (b), or
       ``(ii) to the extent provided in regulations prescribed by 
     the corporation, that the amount of the unfunded vested 
     benefits allocable to an employer not described in section 
     4203(b)(1)(A) shall be determined in a manner different from 
     that provided in subsection (b).''.

     TITLE III--PLAN GOVERNANCE, DISCLOSURE, AND OTHER REFORMS FOR 
              MULTIEMPLOYER DEFINED BENEFIT PENSION PLANS

   Subtitle A--Plan Governance and Operations for Multiemployer Plans

     SEC. 301. INDEPENDENT TRUSTEES.

       Section 4042 of the Employee Retirement Income Security Act 
     of 1974 (29 U.S.C. 1342) is amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1), by striking ``a 
     plan'' and inserting ``a single-employer or multiemployer 
     plan'';
       (B) in paragraph (3)--
       (i) by inserting ``with respect to a single-employer plan'' 
     before the comma; and
       (ii) by striking ``or'';
       (C) in paragraph (4), by striking the period at the end and 
     inserting ``, or''; and
       (D) by inserting after paragraph (4) the following:
       ``(5) in the case of a multiemployer plan--
       ``(A) such plan is an eligible multiemployer plan as 
     defined in section 4233A which fails to apply for a special 
     partition under such section, or
       ``(B) termination of the plan would protect the interests 
     of participants and beneficiaries.'';
       (2) in subsection (b)--
       (A) in paragraph (2)--
       (i) in subparagraph (A)--

       (I) by inserting ``or remove'' after ``appoint'',
       (II) by inserting ``or removal'' after ``appointment'', and
       (III) by striking ``and'' at the end;

       (ii) by striking subparagraph (B) and inserting the 
     following:
       ``(B) upon the petition of the corporation, the appropriate 
     United States district court shall appoint a trustee proposed 
     by the corporation for--
       ``(i) any multiemployer plan which is in critical status or 
     critical and declining status (as defined in paragraph (3) or 
     (7), respectively, of section 305(b)), if the court finds the 
     appointment of the trustee would help prevent an abuse of the 
     multiemployer insurance program or any unreasonable increase 
     in the liability of the fund, and
       ``(ii) any multiemployer plan which has terminated under 
     section 4041A(a), unless a party opposing appointment of a 
     trustee shows that such appointment would be materially 
     adverse to the interests of the plan participants and 
     beneficiaries in the aggregate, and''; and
       (iii) by adding at the end the following:
       ``(C) in the case of a special partition of a plan under 
     section 4233A, the corporation may remove and appoint 
     trustees subject to the provisions of paragraph (5).''; and
       (B) by adding at the end the following:
       ``(4)(A) A trustee appointed to a multiemployer plan under 
     paragraph (2)(B), (2)(C), or (3) shall report plan activity 
     to the corporation, in the form and manner provided for in 
     the judicial or administrative order or agreement appointing 
     the trustee. A trustee so appointed may remain a trustee 
     engaged in the ongoing governance of a multiemployer plan 
     whether or not the corporation initiates plan termination 
     proceedings under subsection (c).
       ``(B) Notwithstanding plan or trust documents to the 
     contrary, in addition to any powers described in subsection 
     (d), the order or agreement appointing a trustee under 
     paragraph (2)(B), (2)(C), or (3) may include authority for 
     the corporation to monitor and oversee plan activity and to 
     review and approve trustee decisions related to funding or 
     financial activities of the plan.
       ``(5)(A) The corporation may remove any trustees of an 
     original plan that received a special partition under section 
     4233A if the corporation determines that the actions of such 
     trustees unreasonably increased the risk of loss to 
     participants in the plan or to the corporation, and may 
     appoint 1 or more new trustees as replacements.
       ``(B) The corporation may appoint a special master, which 
     may be an employee of the corporation, the duties of whom 
     shall be disclosed to participants and contributing employers 
     in accordance with regulations to be issued by the 
     corporation, with respect to each original plan, as defined 
     in section 4233A. Such special master shall be invited to 
     every meeting of the plan's board of trustees or any 
     committees thereof; shall be furnished any requested 
     actuarial or financial information by the plan or agents 
     thereof; shall receive all creditable complaints or other 
     information from participants, beneficiaries, employers, plan 
     employees and contractors, and any other person regarding the 
     plan's operations; and shall furnish the corporation with 
     semiannual reports of the board's activities, the plan's 
     performance, and the potential liabilities of the corporation 
     with respect to the plan. The trustees shall provide the 
     special master with not less than 30 days notice prior to 
     taking any action that could increase the risk of loss to the 
     corporation, and the special master shall report such 
     potential action to the corporation within 5 days of 
     receiving such notice from the trustees.'';
       (3) in subsection (c)(1)--
       (A) in the second sentence, by striking ``subsection (b)'' 
     and inserting ``subsection (b)(1)''; and
       (B) in the third sentence, by inserting ``, including, in 
     the case of a multiemployer plan, by requiring the withdrawal 
     of employers'' before the period; and
       (4) in subsection (d)(1)--
       (A) in subparagraph (A), by striking ``subsection (b)'' in 
     the second sentence and inserting ``subsection (b)(1)''; and
       (B) in subparagraph (B), by striking ``If'' and inserting 
     ``If a trustee is appointed under paragraph (2) or (3) of 
     subsection (b), or if''.

     SEC. 302. INVESTIGATORY AUTHORITY.

       Section 4003(a) of the Employee Retirement Income Security 
     Act of 1974 (29 U.S.C. 1303(a)) is amended to read as 
     follows:
       ``(a)(1) The corporation may, in its discretion, 
     investigate any facts, conditions, practices, or matters as 
     the corporation determines necessary or proper to aid in--
       ``(A) the enforcement of any provision of this title or any 
     rule or regulation thereunder;
       ``(B) the prescribing of rules and regulations under this 
     title; or
       ``(C) evaluating the corporation's liability or potential 
     liability with respect to a plan.
       ``(2) Any information or documentary material submitted to 
     the corporation pursuant to this section, if clearly 
     designated by the person making the submission as 
     confidential (on each page in the case of a document, and in 
     the file name in the case of a digital file), shall be exempt 
     from disclosure under section 552 of title 5, United States 
     Code, and no such information or documentary material may be 
     made public, except as may be relevant to any administrative 
     or judicial action or proceeding, including an informal 
     rulemaking.
       ``(3) The corporation may require or permit any person to 
     submit a statement in writing, under oath or otherwise as the 
     corporation determines, as to all facts and circumstances 
     concerning the matter to be investigated.
       ``(4) The corporation shall annually audit a statistically 
     significant number of plans terminating under section 4041(b) 
     to determine whether participants and beneficiaries have 
     received their benefit commitments and whether section 
     4050(a) has been satisfied. Each audit shall include a 
     statistically significant number of participants and 
     beneficiaries.''.

     SEC. 303. CONDITIONS ON FINANCIAL ASSISTANCE.

       (a) In General.--Section 4261(b) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1431(b)) is amended--
       (1) in paragraph (1), by striking the period at the end and 
     inserting ``, or to prevent an abuse of the multiemployer 
     insurance program or any unreasonable increase in the 
     liability of the fund. The corporation shall provide the plan 
     sponsor written notice of each condition on financial 
     assistance and a written explanation of its determination. If 
     the sponsor fails to satisfy timely a condition on financial 
     assistance, the corporation may withhold financial assistance 
     until the condition is satisfied.''; and
       (2) by adding at the end the following:
       ``(3) The conditions described in paragraph (1) may include 
     an offset for the guaranteed benefits of a participant whose 
     benefit in excess of the benefit guaranteed under this title 
     is provided by another plan, or in the case of a plan that 
     has not yet terminated, the cessation of future accruals or a 
     requirement that contribution amounts or annual withdrawal 
     liability payment amounts under section 4219 be maintained as 
     if the employer had withdrawn on the date of insolvency.''.
       (b) Conforming Amendment.--Section 4261(a) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1431(a)) is 
     amended by striking ``section 4245(f) or section 4281(d)'' 
     and inserting ``section 4245(e) or 4281''.

     SEC. 304. EXCISE TAX ON EXCESS COMPENSATION OF COVERED 
                   EMPLOYEES OF PARTITIONED MULTIEMPLOYER PLANS.

       (a) In General.--Chapter 43 of the Internal Revenue Code of 
     1986 is amended by adding at the end the following new 
     section:

     ``SEC. 4980I. TAX ON EXCESS COMPENSATION OF COVERED EMPLOYEES 
                   OF PARTITIONED MULTIEMPLOYER PLANS.

       ``(a) Tax Imposed.--In the case of an applicable 
     multiemployer plan, there is hereby imposed an excise tax for 
     each plan year in an amount equal to the product of--
       ``(1) the rate of tax under section 11 for taxable years 
     beginning in the calendar year in which such plan year 
     begins, and
       ``(2) so much of the remuneration paid by the applicable 
     multiemployer plan for the plan year with respect to 
     employment of any covered employee as exceeds $500,000.
     For purposes of the preceding sentence, remuneration shall be 
     treated as paid when

[[Page S7618]]

     there is no substantial risk of forfeiture (within the 
     meaning of section 457(f)(3)(B)) of the rights to such 
     remuneration.
       ``(b) Liability for Tax.--The applicable multiemployer plan 
     shall be liable for the tax imposed under subsection (a).
       ``(c) Definitions and Special Rules.--For purposes of this 
     section--
       ``(1) Applicable multiemployer plan.--The term `applicable 
     multiemployer plan' means any multiemployer plan which is an 
     original plan (as defined in section 4233A(d)(3) of the 
     Employee Retirement Income Security Act of 1974) with respect 
     to a multiemployer plan which was partitioned pursuant to an 
     order by the Pension Benefit Guaranty Corporation under 
     section 4233A of such Act.
       ``(2) Covered employee.--The term `covered employee' means 
     any employee (including any former employee) of an applicable 
     multiemployer plan if the employee--
       ``(A) is one of the 5 highest compensated employees of the 
     plan for the plan year, or
       ``(B) was a covered employee of the organization (or any 
     predecessor) for any preceding plan year beginning after the 
     date of the enactment of this section.
       ``(3) Remuneration.--The term `remuneration' means wages 
     (as defined in section 3401(a)).
       ``(d) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary to prevent avoidance of the 
     tax under this section, including regulations to prevent 
     avoidance of such tax through the performance of services 
     other than as an employee or by providing compensation 
     through a pass-through or other entity (including a related 
     entity) to avoid such tax.''.
       (b) Conforming Amendment.--The table of sections for 
     chapter 43 of the Internal Revenue Code of 1986 is amended by 
     adding at the end the following new item:

``Sec. 4980I. Tax on excess compensation of covered employees of 
              partitioned multiemployer plans.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after the date of 
     enactment of this Act.

         Subtitle B--Reportable Events for Multiemployer Plans

     SEC. 311. REPORTABLE EVENTS.

       (a) Additional Reportable Events.--
       (1) In general.--Section 4043(c) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1343(c)) is amended by 
     striking ``or'' at the end of paragraph (12), by 
     redesignating paragraph (13) as paragraph (17), and by 
     inserting after paragraph (12) the following new paragraphs:
       ``(13) when the plan sponsor of a multiemployer plan, or 
     such sponsor's delegate, convenes or otherwise takes action 
     to adopt any amendment (or accepts any collective bargaining 
     agreement) that would exclude newly hired employees from 
     participation in the plan, or any amendment (or agreement) 
     that would substantially reduce the rate of future benefit 
     accruals or the contribution rate for any participants under 
     the plan;
       ``(14) when--
       ``(A) the plan sponsor of a multiemployer plan, or such 
     sponsor's delegate, convenes or otherwise takes action to 
     adopt; or
       ``(B) the plan sponsor receives notice under subsection (f) 
     or otherwise becomes aware that the bargaining parties have 
     negotiated an agreement to adopt;
     a new pension plan, including any plan a trust forming part 
     of which is a qualified trust under section 401(a) of the 
     Internal Revenue Code of 1986 and any plan treated as a 
     welfare plan by reason of section 3(2)(B)(ii), the expected 
     participants of which are expected to substantially overlap 
     with the active participants in a preexisting plan;
       ``(15) when an event pertaining to a multiemployer plan 
     occurs that is prescribed by the corporation in regulations, 
     if the event materially jeopardizes the security of 
     participant benefits or the financial condition of the plan, 
     or is likely to increase the risk of loss to the corporation;
       ``(16) when a multiemployer plan has, or will foreseeably 
     have, only one trustee or no trustees on its board; or''.
       (2) Notification by bargaining parties.--Section 4043 of 
     such Act (29 U.S.C. 1343) is amended by redesignating 
     subsection (f) as subsection (g), and by inserting after 
     subsection (e) the following new subsection:
       ``(f) Notification by Bargaining Parties.--Not later than 
     60 days prior to the adoption of a new pension plan described 
     in subsection (c)(14), the bargaining parties shall notify 
     the plan sponsor of the negotiation of an agreement to adopt 
     such plan.''.
       (3) Conforming amendment.--Section 4043(b)(3) of such Act 
     (29 U.S.C. 1343(b)(3)) is amended by striking ``(13)'' and 
     inserting ``(17)''.
       (b) Application to Plans.--
       (1) In general.--Section 4043(a) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1343(a)) is amended by 
     inserting ``, plan sponsor (in the case of a multiemployer 
     plan),'' after ``plan administrator''.
       (2) Notification that event is about to occur.--Section 
     4043(b) of such Act (29 U.S.C. 1343(b)) is amended--
       (A) in paragraph (1)--
       (i) by redesignating subparagraphs (A) and (B) as clauses 
     (i) and (ii), respectively, and by moving such clauses 2 ems 
     to the right;
       (ii) by striking ``shall be applicable to a contributing 
     sponsor'' and inserting ``shall be applicable--
       ``(A) to any plan sponsor of a multiemployer plan; and
       ``(B) to any contributing sponsor''; and
       (iii) in the last sentence, by striking ``subparagraph 
     (B)'' and inserting ``clause (ii)'';
       (B) by striking ``This subsection'' in paragraph (2) and 
     inserting ``In the case of a single-employer plan, this 
     subsection'';
       (C) by striking ``any contributing sponsor'' in paragraph 
     (4) and inserting ``any plan sponsor of a multiemployer plan 
     or any contributing sponsor'';
       (D) by redesignating paragraph (4), as so amended, as 
     paragraph (5); and
       (E) by inserting after paragraph (3) the following new 
     paragraph:
       ``(4) No later than 60 days prior to an event described in 
     paragraph (13), (14)(A), (15), or (16) of subsection (c), the 
     plan sponsor of a multiemployer plan shall notify the 
     corporation that the event is about to occur.''.
       (c) Technical Corrections.--
       (1) Section 4045(c)(1) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1345(c)(1)) is amended by 
     striking ``4043(b)(7)'' and inserting ``4043(c)(7)''.
       (2) Section 4065(2) of such Act (29 U.S.C. 1365(2)) is 
     amended by striking ``4043(b)'' and inserting ``4043(c)''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to reportable events (as defined in section 
     4043(c) of the Employee Retirement Income Security Act of 
     1974 (29 U.S.C. 1343(c))) occurring after the date of the 
     enactment of this Act.

   Subtitle C--Funding Notices to Participants in Multiemployer Plans

     SEC. 321. IMPROVED MULTIEMPLOYER PLAN DISCLOSURE.

       (a) Plan Funding Notices.--Section 101(f) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1021(f)) is 
     amended--
       (1) in paragraph (2)(B)--
       (A) in clause (iv), by striking ``setting forth'' and 
     inserting ``describing how a person may obtain information 
     regarding'';
       (B) by striking clauses (v) and (vi);
       (C) by redesignating clauses (vii) through (xi) as clauses 
     (v) through (ix), respectively;
       (D) in clause (vi), as so redesignated--
       (i) by striking ``(I) in the case of'' and inserting ``in 
     the case of'';
       (ii) by striking ``, or'' and inserting a comma; and
       (iii) by striking subclause (II); and
       (E) by amending clause (vii), as so redesignated, to read 
     as follows:
       ``(vii)(I) in the case of a single-employer plan, a general 
     description of the benefits under the plan which are eligible 
     to be guaranteed by the Pension Benefit Guaranty Corporation, 
     and an explanation of the limitations on the guarantee and 
     the circumstances under which such limitations apply, and
       ``(II) in the case of a multiemployer plan, a statement 
     that eligible benefits are guaranteed by the Pension Benefit 
     Guaranty Corporation, and a statement of how to obtain both a 
     general description of the benefits under the plan which are 
     eligible to be guaranteed by the Pension Benefit Guaranty 
     Corporation and an explanation of the limitations on the 
     guarantee and the circumstances under which such limitations 
     apply,''; and
       (2) in paragraph (4)(C)--
       (A) by striking ``(C) may be provided'' and inserting 
     ``(C)(i) subject to clause (ii), may be provided'';
       (B) by striking the period and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(ii) in the case of such a notice provided to the Pension 
     Benefit Guaranty Corporation, shall be in an electronic 
     format in such manner prescribed in regulations of such 
     Corporation.''.
       (b) Disclosures by Plans Regarding Status.--
       (1) Amendments to employee retirement income security act 
     of 1974.--Section 305(b)(4) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1085(b)(4)), as redesignated 
     by section 212(a) and as in effect before the amendments made 
     by section 212 other than subsection (a) thereof, is further 
     amended--
       (A) in the paragraph heading, by striking ``by plan 
     actuary'' and inserting ``and report'';
       (B) by amending subparagraph (A) to read as follows:
       ``(A) In general.--Not later than the 90th day of each plan 
     year of a multiemployer plan, the plan sponsor shall file, in 
     accordance with regulations prescribed by the ERISA agencies, 
     a report that contains--
       ``(i) documentation from the plan actuary certifying to the 
     ERISA agencies and to the plan sponsor--

       ``(I) whether or not the plan is in unrestricted or stable 
     status for such plan year, whether or not the plan is in 
     endangered status for such plan year and whether or not the 
     plan is or will be in critical status for such plan year or 
     any of the 5 succeeding plan years,
       ``(II) in the case of a plan which is in a funding 
     improvement or rehabilitation period, whether or not the plan 
     is making the scheduled progress in meeting the requirements 
     of its funding improvement or rehabilitation plan and, if 
     not, a summary of the primary reasons the plan is not making 
     the scheduled progress,
       ``(III) the funded percentage of the plan determined as of 
     the first day of the current plan year and the value of 
     assets and liabilities used to calculate such funded 
     percentage,
       ``(IV) a projection of the funding standard account on a 
     year-by-year basis for the current plan year and the 14 
     succeeding plan

[[Page S7619]]

     years and a statement of the actuarial assumptions for such 
     projections, and
       ``(V)(aa) subject to item (bb), a projection of the cash 
     flow of the plan and actuarial assumptions for the current 
     plan year and 14 succeeding plan years, and
       ``(bb) in the case in which it is certified that a 
     multiemployer plan is or will be in endangered or critical 
     status for a plan year, the projection of the cash flow of 
     the plan and actuarial assumptions for the current year and 
     29 succeeding plan years,

       ``(ii) as of the last day of the prior plan year, a good 
     faith determination of--

       ``(I) the fair market value of the assets of the plan,
       ``(II) the number of participants who are--

       ``(aa) retired or separated from service and are receiving 
     benefits,
       ``(bb) retired or separated participants entitled to future 
     benefits, and
       ``(cc) active participants under the plan,

       ``(III) the total value of all benefits paid during the 
     prior plan year,
       ``(IV) the total value of all contributions and withdrawal 
     liability payments made to the plan during the prior plan 
     year, and
       ``(V) the total value of all investment gains or losses 
     during the prior plan year,

       ``(iii) a description of any material changes during the 
     previous plan year to the rates at which participants accrue 
     benefits or the rate at which employers contribute,
       ``(iv) a copy of any funding improvement plan or 
     rehabilitation plan, and any update thereto or modification 
     thereof, that was adopted under this section prior to the 
     filing of the report for the current plan year in accordance 
     with this subparagraph and, if applicable, after the filing 
     of the report required by this subparagraph for the prior 
     plan year,
       ``(v) in the case of any plan amendment, scheduled benefit 
     increase or reduction, or other known event taking effect in 
     the current plan year and having a material effect on plan 
     liabilities or assets for the year (as defined in regulations 
     by the ERISA agencies), an explanation of the amendment, 
     scheduled increase or reduction, or event, and a projection 
     to the end of such plan year of the effect of the amendment, 
     scheduled increase or reduction, or event on plan 
     liabilities,
       ``(vi) in the case of a multiemployer plan certified to be 
     in critical status for which the plan sponsor has determined 
     that, based on reasonable actuarial assumptions and upon 
     exhaustion of all reasonable measures, the plan cannot 
     reasonably be expected to emerge from critical status by the 
     end of the rehabilitation period, a description of all 
     reasonable measures, whether or not such measures were 
     implemented, and a summary of the consideration of such 
     measures,
       ``(vii) a statement, containing the information available 
     to the plan sponsor, describing--

       ``(I) the withdrawal of any employer during the prior plan 
     year and the percentage of total contributions made by that 
     employer during the prior plan year,
       ``(II) any material reduction in total contributions or 
     withdrawal liability payments of any employers and the reason 
     for such reduction, and a comparison to contributions 
     projected previously,
       ``(III) any material reduction in the number of active plan 
     participants and the reason for such reduction, and
       ``(IV) the annual withdrawal liability payment each 
     withdrawn employer is obligated to pay to the plan for the 
     plan year, whether that amount was collected by the plan (and 
     if not, the amount that was collected), and the remaining 
     years on the employer's obligation to make withdrawal 
     liability payments, and

       ``(viii) such other information as may be required by the 
     ERISA agencies by regulation.'';
       (C) by striking subparagraph (C) and inserting the 
     following:
       ``(C) Form and manner.--The report required by subparagraph 
     (A) shall be filed electronically in accordance with 
     regulations prescribed by the ERISA agencies.''; and
       (D) in subparagraph (D)--
       (i) by redesignating clauses (ii), (iii), (iv), and (v) as 
     clauses (iii), (iv), (v), and (vi), respectively;
       (ii) by inserting after clause (i) the following:
       ``(ii) Plans in endangered or critical status.--If it is 
     certified under subparagraph (A) that a multiemployer plan is 
     or will be in endangered or critical status, the plan sponsor 
     shall include in the notice under clause (i)--

       ``(I) a statement describing how a person may obtain a copy 
     of the plan's funding improvement or rehabilitation plan, as 
     appropriate, adopted under this section and the actuarial and 
     financial data that demonstrate any action taken by the plan 
     toward fiscal improvement,
       ``(II) a summary of any funding improvement or 
     rehabilitation plan, and any update thereto or modification 
     thereof, adopted under this section prior to the furnishing 
     of such notice,
       ``(III) a summary of the rules governing insolvency, 
     including the limitations on benefit payments, and
       ``(IV) a general description of the benefits under the plan 
     which are eligible to be guaranteed by the Pension Benefit 
     Guaranty Corporation and an explanation of the limitations on 
     the guarantee and the circumstances under which such 
     limitations apply.'';

       (iii) in clause (v), as so redesignated--

       (I) by striking ``The Secretary of the Treasury, in 
     consultation with the Secretary'' and inserting ``The ERISA 
     agencies''; and
       (II) by striking ``(ii) and (iii)'' and inserting ``(ii), 
     (iii), and (iv)''; and

       (E) by adding at the end the following:
       ``(E) Designation and coordination.--The ERISA agencies 
     shall--
       ``(i) designate one ERISA agency to receive the report 
     described in subparagraph (A) on behalf of all the ERISA 
     agencies, which shall each have full access to such report; 
     and
       ``(ii) consult with each other and develop rules, 
     regulations, practices, and forms, which to the extent 
     appropriate for the efficient administration of the 
     provisions of this paragraph are designed to replace 
     duplication of effort, duplication of reporting, conflicting 
     or overlapping requirements, and the burden of compliance 
     with such provisions by plan administrators and plan 
     sponsors.
       ``(F) ERISA agencies.--In this paragraph, the term `ERISA 
     agencies' means the Secretary, the Secretary of the Treasury, 
     and the Pension Benefit Guaranty Corporation.''.
       (2) Amendments to 1986 code.--Section 432(b)(4) of the 
     Internal Revenue Code of 1986, as redesignated by section 
     211(a) and as in effect before the amendments made by section 
     211 other than subsection (a) thereof, is further amended--
       (A) in the paragraph heading, by striking ``by plan 
     actuary'' and inserting ``and report'';
       (B) by amending subparagraph (A) to read as follows:
       ``(A) In general.--Not later than the 90th day of each plan 
     year of a multiemployer plan, the plan sponsor shall file, in 
     accordance with regulations prescribed by the ERISA agencies, 
     a report that contains--
       ``(i) documentation from the plan actuary certifying to the 
     ERISA agencies and to the plan sponsor--

       ``(I) whether or not the plan is in unrestricted or stable 
     status for such plan year, whether or not the plan is in 
     endangered status for such plan year and whether or not the 
     plan is or will be in critical status for such plan year or 
     any of the 5 succeeding plan years,
       ``(II) in the case of a plan which is in a funding 
     improvement or rehabilitation period, whether or not the plan 
     is making the scheduled progress in meeting the requirements 
     of its funding improvement or rehabilitation plan and, if 
     not, a summary of the primary reasons the plan is not making 
     the scheduled progress,
       ``(III) the funded percentage of the plan determined as of 
     the first day of the current plan year and the value of 
     assets and liabilities used to calculate such funded 
     percentage,
       ``(IV) a projection of the funding standard account on a 
     year-by-year basis for the current plan year and the 14 
     succeeding plan years and a statement of the actuarial 
     assumptions for such projections, and
       ``(V)(aa) subject to item (bb), a projection of the cash 
     flow of the plan and actuarial assumptions for the current 
     plan year and 14 succeeding plan years, and
       ``(bb) in the case in which it is certified that a 
     multiemployer plan is or will be in endangered or critical 
     status for a plan year, the projection of the cash flow of 
     the plan and actuarial assumptions for the current year and 
     29 succeeding plan years,

       ``(ii) as of the last day of the prior plan year, a good 
     faith determination of--

       ``(I) the fair market value of the assets of the plan,
       ``(II) the number of participants who are--

       ``(aa) retired or separated from service and are receiving 
     benefits,
       ``(bb) retired or separated participants entitled to future 
     benefits, and
       ``(cc) active participants under the plan,

       ``(III) the total value of all benefits paid during the 
     prior plan year,
       ``(IV) the total value of all contributions and withdrawal 
     liability payments made to the plan during the prior plan 
     year, and
       ``(V) the total value of all investment gains or losses 
     during the prior plan year,

       ``(iii) a description of any material changes during the 
     previous plan year to the rates at which participants accrue 
     benefits or the rate at which employers contribute,
       ``(iv) a copy of any funding improvement plan or 
     rehabilitation plan, and any update thereto or modification 
     thereof, that was adopted under this section prior to the 
     filing of the report for the current plan year in accordance 
     with this subparagraph and, if applicable, after the filing 
     of the report required by this subparagraph for the prior 
     plan year,
       ``(v) in the case of any plan amendment, scheduled benefit 
     increase or reduction, or other known event taking effect in 
     the current plan year and having a material effect on plan 
     liabilities or assets for the year (as defined in regulations 
     by the ERISA agencies), an explanation of the amendment, 
     scheduled increase or reduction, or event, and a projection 
     to the end of such plan year of the effect of the amendment, 
     scheduled increase or reduction, or event on plan 
     liabilities,
       ``(vi) in the case of a multiemployer plan certified to be 
     in critical status for which the plan sponsor has determined 
     that, based on reasonable actuarial assumptions and upon 
     exhaustion of all reasonable measures, the plan cannot 
     reasonably be expected to emerge from critical status by the 
     end of the rehabilitation period, a description of all

[[Page S7620]]

     reasonable measures, whether or not such measures were 
     implemented, and a summary of the consideration of such 
     measures,
       ``(vii) a statement, containing the information available 
     to the plan sponsor, describing--

       ``(I) the withdrawal of any employer during the prior plan 
     year and the percentage of total contributions made by that 
     employer during the prior plan year, and a comparison to 
     contributions projected previously.
       ``(II) any material reduction in total contributions or 
     withdrawal liability payments of any employers and the reason 
     for such reduction,
       ``(III) any material reduction in the number of active plan 
     participants and the reason for such reduction, and
       ``(IV) the annual withdrawal liability payment each 
     withdrawn employer is obligated to pay to the plan for the 
     plan year, whether that amount was collected by the plan (and 
     if not, the amount that was collected), and the remaining 
     years on the employer's obligation to make withdrawal 
     liability payments, and

       ``(viii) such other information as may be required by the 
     ERISA agencies by regulation.'';
       (C) by striking subparagraph (C) and inserting the 
     following:
       ``(C) Form and manner.--The report required by subparagraph 
     (A) shall be filed electronically in accordance with 
     regulations prescribed by the ERISA agencies.'';
       (D) in subparagraph (D)--
       (i) by redesignating clauses (ii), (iii), (iv), and (v) as 
     clauses (iii), (iv), (v), and (vi), respectively;
       (ii) by inserting after clause (i) the following:
       ``(ii) Plans in endangered or critical status.--If it is 
     certified under subparagraph (A) that a multiemployer plan is 
     or will be in endangered or critical status, the plan sponsor 
     shall include in the notice under clause (i)--

       ``(I) a statement describing how a person may obtain a copy 
     of the plan's funding improvement or rehabilitation plan, as 
     appropriate, adopted under this section and the actuarial and 
     financial data that demonstrate any action taken by the plan 
     toward fiscal improvement,
       ``(II) a summary of any funding improvement or 
     rehabilitation plan, and any update thereto or modification 
     thereof, adopted under this section prior to the furnishing 
     of such notice,
       ``(III) a summary of the rules governing insolvency, 
     including the limitations on benefit payments, and
       ``(IV) a general description of the benefits under the plan 
     which are eligible to be guaranteed by the Pension Benefit 
     Guaranty Corporation and an explanation of the limitations on 
     the guarantee and the circumstances under which such 
     limitations apply.''; and

       (iii) in clause (v), as so redesignated--

       (I) by striking ``The Secretary of the Treasury, in 
     consultation with the Secretary'' and inserting ``The ERISA 
     agencies''; and
       (II) by striking ``(ii) and (iii)'' and inserting ``(ii), 
     (iii), and (iv)''; and

       (E) by adding at the end the following:
       ``(E) Designation and coordination.--The ERISA agencies 
     shall--
       ``(i) designate one ERISA agency to receive the report 
     described in subparagraph (A) on behalf of all the ERISA 
     agencies, which shall each have full access to such report; 
     and
       ``(ii) consult with each other and develop rules, 
     regulations, practices, and forms, which to the extent 
     appropriate for the efficient administration of the 
     provisions of this paragraph are designed to replace 
     duplication of effort, duplication of reporting, conflicting 
     or overlapping requirements, and the burden of compliance 
     with such provisions by plan administrators and plan 
     sponsors.
       ``(F) ERISA agencies.--In this paragraph, the term `ERISA 
     agencies' means the Secretary, the Secretary of Labor, and 
     the Pension Benefit Guaranty Corporation.''.
       (3) Investigations.--Section 4003 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1303) is 
     amended by adding at the end the following:
       ``(g) The corporation may investigate or review any facts, 
     conditions, practices, or other matters it determines 
     necessary or proper related to the actuarial certification 
     and report by multiemployer plans under section 305(b)(4)(A), 
     or to obtain such information as any duly authorized 
     committee or subcommittee of the Congress may request with 
     respect to such plans. Any information or documentary 
     material submitted to the corporation pursuant to this 
     section, if clearly designated by the person making the 
     submission as confidential (on each page in the case of a 
     document, and in the file name in the case of a digital 
     file), shall be exempt from disclosure under section 552 of 
     title 5, United States Code, and no such information or 
     documentary material may be made public, except as may be 
     relevant to any administrative or judicial action or 
     proceeding, including an informal rulemaking.''.

     SEC. 322. PENALTIES FOR FAILURE TO PROVIDE NOTICES.

       (a) In General.--Section 502(c) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1132) is amended--
       (1) in paragraph (7)--
       (A) by striking ``(7) The Secretary'' and inserting 
     ``(7)(A) The Secretary''; and
       (B) by adding at the end the following:
       ``(B) The Secretary may assess a civil penalty against a 
     plan sponsor of up to $110 per day from the date of the plan 
     administrator's or sponsor's failure or refusal to provide 
     the relevant notices under section 101(f) or section 
     305(b)(4)(D) to a recipient other than the Secretary or the 
     Pension Benefit Guaranty Corporation. For purposes of this 
     paragraph, each violation with respect to any single 
     recipient shall be treated as a separate violation.''; and
       (2) by adding at the end the following:
       ``(13)(A) The Secretary may assess a civil penalty against 
     any plan sponsor of up to $2,140 per day from the date of the 
     plan sponsor's failure to file with the Secretary or the 
     Pension Benefit Guaranty Corporation the notice required 
     under section 305(b)(4)(D) or with the Pension Benefit 
     Guaranty Corporation the notice required under section 
     101(f).
       ``(B) The Secretary may assess a civil penalty against any 
     plan sponsor of up to $1,100 per day from the date of the 
     plan sponsor's failure to file with the ERISA agency 
     designated in accordance with subparagraph (E) of section 
     305(b)(4) the report under subparagraph (A) of such 
     section.''.
       (b) Conforming Amendment.--Section 502(a)(6) of such Act is 
     amended by striking ``or (9)'' and inserting ``(9), (10), or 
     (13)''.

             Subtitle D--Consistency of Criminal Penalties

     SEC. 331. CONSISTENCY OF CRIMINAL PENALTIES.

       Part I of title 18, United States Code, is amended--
       (1) in section 664, in the first undesignated paragraph, by 
     striking ``five years'' and inserting ``10 years'';
       (2) in section 1027, by striking ``five years'' and 
     inserting``10 years''; and
       (3) in section 1954, in the undesignated matter following 
     paragraph (4), by striking ``three years'' and inserting ``10 
     years''.

               TITLE IV--OTHER MULTIEMPLOYER PLAN REFORMS

     SEC. 401. CLARIFICATION OF FIDUCIARY DUTY OF RETIREE 
                   REPRESENTATIVE WHO IS A TRUSTEE.

       (a) Amendment of Internal Revenue Code of 1986.--Subclause 
     (III) of section 432(f)(9)(B)(v) of the Internal Revenue Code 
     of 1986, as redesignated by section 211(a) and as in effect 
     before the amendments made by section 211 other than 
     subsection (a) thereof, is amended by striking the period and 
     inserting ``, or to any other duties performed by such person 
     pursuant to such person's role as a plan trustee.''.
       (b) Amendment of Employee Retirement Income Security Act of 
     1974.--Subclause (III) of section 305(f)(9)(B)(v) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1085(f)(9)(B)(v)), as redesignated by section 212(a) and as 
     in effect before the amendments made by section 212 other 
     than subsection (a) thereof, is amended by striking the 
     period and inserting ``, or to any other duties performed by 
     such person pursuant to such person's role as a plan 
     trustee.''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 402. SAFE HARBORS.

       (a) Amendments to Internal Revenue Code of 1986.--
       (1) Equitable distribution of benefit suspensions.--Clause 
     (vi) of section 432(f)(9)(D) of the Internal Revenue Code of 
     1986, as redesignated by section 211(a) and as in effect 
     before the amendments made by section 211 other than 
     subsection (a) thereof, is amended by adding at the end the 
     following flush language:
     ``For purposes of the preceding sentence, a suspension of 
     benefits in the form of a flat percentage reduction in 
     benefits which is applied in the same manner to all 
     participants and beneficiaries (before application of clauses 
     (ii) and (iii)) shall be treated as being equitably 
     distributed across the participant and beneficiary 
     population.''.
       (2) Application assumptions.--Clause (v) of section 
     432(f)(9)(G) of such Code, as so redesignated and in effect, 
     is amended--
       (A) by striking ``Standard for accepting'' in the heading 
     and inserting ``Standards for assumptions and accepting'', 
     and
       (B) by striking ``In evaluating'' and inserting ``The 
     Secretary, in consultation with the Pension Benefit Guaranty 
     Corporation and the Secretary of Labor, shall promulgate 
     regulations regarding the actuarial assumptions that plans 
     may use for purposes of the application under this 
     subparagraph. Such regulations shall create safe harbors 
     regarding assumptions for future rate of investment returns, 
     future industry activity and contribution base units, 
     mortality, and other assumptions as determined by the 
     Secretary, and shall describe the situations in which 
     actuarial assumptions may change during review of an 
     application without the withdrawal and resubmission of the 
     application. In evaluating''.
       (b) Amendments to Employee Retirement Income Security Act 
     of 1974.--
       (1) Equitable distribution of benefit suspensions.--Clause 
     (vi) of section 305(f)(9)(D) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1085(f)(9)(D)), as 
     redesignated by section 212(a) and as in effect before the 
     amendments made by section 212 other than subsection (a) 
     thereof, is amended by adding at the end the following flush 
     language:
     ``For purposes of the preceding sentence, a suspension of 
     benefits in the form of a flat percentage reduction in 
     benefits which is applied in the same manner to all 
     participants and beneficiaries (before application of

[[Page S7621]]

     clauses (ii) and (iii)) shall be treated as being equitably 
     distributed across the participant and beneficiary 
     population.''.
       (2) Application assumptions.--Clause (v) of section 
     305(f)(9)(G) of such Act (29 U.S.C. 1085(f)(9)(G)), as so 
     redesignated and in effect, is amended--
       (A) by striking ``Standard for accepting'' in the heading 
     and inserting ``Standards for assumptions and accepting'', 
     and
       (B) by striking ``In evaluating'' and inserting ``The 
     Secretary of the Treasury, in consultation with the Pension 
     Benefit Guaranty Corporation and the Secretary of Labor, 
     shall promulgate regulations regarding the actuarial 
     assumptions that plans may use for purposes of the 
     application under this subparagraph. Such regulations shall 
     create safe harbors regarding assumptions for future rate of 
     investment returns, future industry activity and contribution 
     base units, mortality, and other assumptions as determined by 
     the Secretary, and shall describe the situations in which 
     actuarial assumptions may change during review of an 
     application without the withdrawal and resubmission of the 
     application. In evaluating''.
       (c) Effective Dates.--
       (1) In general.--The amendments made by subsections (a)(1) 
     and (b)(1) shall apply to suspensions of benefits taking 
     effect after the date of the enactment of this Act.
       (2) Applications.--The amendments made by subsections 
     (a)(2) and (b)(2) shall apply to applications submitted after 
     the date of the enactment of this Act.

     SEC. 403. CLARIFICATION OF NOTICE AND COMMENT PROCESS.

       (a) Amendments to Internal Revenue Code of 1986.--
       (1) Notice to participants.--Subparagraph (F) of section 
     432(f)(9) of the Internal Revenue Code of 1986, as 
     redesignated by section 211(a) and as in effect before the 
     amendments made by section 211 other than subsection (a) 
     thereof, is amended by adding at the end the following new 
     clause:
       ``(vi) De minimis changes.--Notice under clause (i) is not 
     required in the case of a change to a notice previously 
     issued, and an application previously submitted under 
     subparagraph (G), if such change would have a de minimis 
     effect on the suspension of benefits proposed, such as a 
     change of 5 percent or less (whether increase or decrease) of 
     a participant's post-suspension benefits.''.
       (2) Solicitation of comments.--
       (A) De minimis changes.--Clause (ii) of section 
     432(f)(9)(G) of such Code, as so redesignated and in effect, 
     is amended by adding at the end the following: ``The 
     preceding sentences shall not apply in the case of a 
     resubmission of an application previously submitted if such 
     change would have a de minimis effect on the suspension of 
     benefits proposed.''.
       (B) Extension of period for correction of defect.--Clause 
     (iii) of section 432(f)(9)(G) of such Code, as so 
     redesignated and in effect, is amended by inserting after the 
     second sentence the following: ``If the only failure with 
     respect to an application is a failure to provide adequate 
     notice to participants under subparagraph (F), the Secretary 
     may extend the 225-day deadline for consideration of the 
     application by notice to the plan sponsor.''.
       (b) Amendments to Employee Retirement Income Security Act 
     of 1974.--
       (1) Notice to participants.--Subparagraph (F) of section 
     305(f)(9) of the Employee Retirement Income Security Act of 
     1974 (29 U.S.C. 1085(f)(9)), as redesignated by section 
     212(a) and as in effect before the amendments made by section 
     212 other than subsection (a) thereof, is amended by adding 
     at the end the following new clause:
       ``(vi) De minimis changes.--Notice under clause (i) is not 
     required in the case of a change to a notice previously 
     issued, and an application previously submitted under 
     subparagraph (G), if such change would have a de minimis 
     effect on the suspension of benefits proposed, such as a 
     change of 5 percent or less (whether increase or decrease) of 
     a participant's post-suspension benefits.''.
       (2) Solicitation of comments.--
       (A) De minimis changes.--Clause (ii) of section 
     305(f)(9)(G) of such Act (29 U.S.C. 1085(f)(9)(G)), as so 
     redesignated and in effect, is amended by adding at the end 
     the following: ``The preceding sentences shall not apply in 
     the case of a resubmission of an application previously 
     submitted if such change would have a de minimis effect on 
     the suspension of benefits proposed.''.
       (B) Extension of period for correction of defect.--Clause 
     (iii) of section 305(f)(9)(G) of such Act (29 U.S.C. 
     1085(f)(9)(G)), as so redesignated and in effect, is amended 
     by inserting after the second sentence the following: ``If 
     the only failure with respect to an application is a failure 
     to provide adequate notice to participants under subparagraph 
     (F), the Secretary may extend the 225-day deadline for 
     consideration of the application by notice to the plan 
     sponsor.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to applications, or changes to applications, 
     submitted after the date of the enactment of this Act.

     SEC. 404. PROTECTION OF PARTICIPANTS RECEIVING DISABILITY 
                   BENEFITS.

       (a) Amendment to Internal Revenue Code of 1986.--Clause 
     (iii) of section 432(f)(9)(D) of the Internal Revenue Code of 
     1986, as redesignated by section 211(a) and as in effect 
     before the amendments made by section 211 other than 
     subsection (a) thereof, is amended to read as follows:
       ``(iii) No benefits based on disability (as defined under 
     the plan) may be suspended under this paragraph if the 
     participant or beneficiary is disabled (as so defined) or 
     receiving disability benefits under the plan as of the date 
     of the suspension of benefits. No benefits under the plan may 
     be suspended under this paragraph of any participant or 
     beneficiary who is entitled to a benefit under title II of 
     the Social Security Act on the basis of a disability (as 
     defined in section 223(d)(2) of such Act) as of such date.''.
       (b) Amendment to Employee Retirement Income Security Act of 
     1974.--Clause (iii) of section 305(f)(9)(D) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 
     1085(f)(9)(D)), as redesignated by section 212(a) and as in 
     effect before the amendments made by section 212 other than 
     subsection (a) thereof, is amended to read as follows:
       ``(iii) No benefits based on disability (as defined under 
     the plan) may be suspended under this paragraph if the 
     participant or beneficiary is disabled (as so defined) or 
     receiving disability benefits under the plan as of the date 
     of the suspension of benefits. No benefits under the plan may 
     be suspended under this paragraph of any participant or 
     beneficiary who is entitled to a benefit under title II of 
     the Social Security Act on the basis of a disability (as 
     defined in section 223(d)(2) of such Act) as of such date.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to suspensions of benefits taking effect after 
     the date of the enactment of this Act.

     SEC. 405. MODEL NOTICE.

       Not later than 1 year after the date of the enactment of 
     this Act, the Secretary of the Treasury, in consultation with 
     the Secretary of Labor and the Pension Benefit Guaranty 
     Corporation, shall develop a 1-page, plain-language, cover-
     page format for the model notice under section 
     432(e)(9)(F)(v) of the Internal Revenue Code of 1986 (as in 
     effect on the day before the date of the enactment of this 
     Act) and section 305(e)(9)(F)(v) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1085(e)(9)(F)(v)), as 
     so in effect.

                  TITLE V--ALTERNATIVE PLAN STRUCTURES

     SEC. 501. COMPOSITE PLANS.

       (a) Amendment to the Employee Retirement Income Security 
     Act of 1974.--
       (1) In general.--Title I of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1001 et seq.) is amended by 
     adding at the end the following:

               ``PART 8--COMPOSITE PLANS AND LEGACY PLANS

     ``SEC. 801. COMPOSITE PLAN DEFINED.

       ``(a) In General.--For purposes of this Act, the term 
     `composite plan' means a pension plan--
       ``(1) which is a multiemployer plan that is neither a 
     defined benefit plan nor a defined contribution plan;
       ``(2) the terms of which provide that the plan is a 
     composite plan for purposes of this title with respect to 
     which not more than one multiemployer defined benefit plan is 
     treated as a legacy plan within the meaning of section 805, 
     unless there is more than one legacy plan following a merger 
     of composite plans under section 806;
       ``(3) which provides systematically for the payment of 
     benefits--
       ``(A) objectively calculated pursuant to a nondiscretionary 
     formula specified in the plan document with respect to plan 
     participants for life; and
       ``(B) in the form of life annuities, except for benefits 
     which under section 203(e) may be immediately distributed 
     without the consent of the participant;
       ``(4) for which the anticipated employer contributions to 
     the plan for the first plan year are at least 120 percent of 
     the normal cost for the plan year;
       ``(5) which requires--
       ``(A) an annual valuation of the liability of the plan as 
     of a date within the plan year to which the valuation refers 
     or within one month prior to the beginning of such year;
       ``(B) an annual actuarial determination of the plan's 
     current funded ratio and projected funded ratio under section 
     802(a);
       ``(C) corrective action through a realignment program 
     pursuant to section 803 whenever the plan's projected funded 
     ratio is below 120 percent for the plan year; and
       ``(D) an annual notification to each participant describing 
     benefits under the plan and explaining that such benefits may 
     be subject to reduction under a realignment program pursuant 
     to section 803 based on the plan's funded status in future 
     plan years; and
       ``(6) the board of trustees of which includes at least one 
     retiree or beneficiary in pay status during each plan year 
     following the first plan year in which at least 5 percent of 
     the participants in the plan are retirees or beneficiaries in 
     pay status.
       ``(b) Transition From a Multiemployer Defined Benefit 
     Plan.--
       ``(1) In general.--The plan sponsor of a defined benefit 
     plan that is a multiemployer plan may, subject to paragraph 
     (2), amend the plan to incorporate the features of a 
     composite plan as a component of the multiemployer plan 
     separate from the defined benefit plan component, except in 
     the case of a defined benefit plan for which the plan actuary 
     has certified under section 305(b)(4) that the plan is or 
     will be in endangered or critical status for the plan year in 
     which such amendment would become effective or in endangered 
     or critical status for any of the succeeding 5 plan years.

[[Page S7622]]

       ``(2) Requirements.--Any amendment pursuant to paragraph 
     (1) to incorporate the features of a composite plan as a 
     component of a multiemployer plan shall--
       ``(A) apply with respect to all collective bargaining 
     agreements providing for contributions to the multiemployer 
     plan on or after the effective date of the amendment;
       ``(B) apply with respect to all participants in the 
     multiemployer plan for whom contributions are made to the 
     multiemployer plan on or after the effective date of the 
     amendment;
       ``(C) specify that the effective date of the amendment is--
       ``(i) the first day of a specified plan year following the 
     date of the adoption of the amendment, except that the plan 
     sponsor may alternatively provide for a separate effective 
     date with respect to each collective bargaining agreement 
     under which contributions to the multiemployer plan are 
     required, which shall occur on the first day of the first 
     plan year beginning after the termination, or if earlier, the 
     re-opening, of each such agreement, or such earlier date as 
     the parties to the agreement and the plan sponsor of the 
     multiemployer plan shall agree to; and
       ``(ii) not later than the first day of the fifth plan year 
     beginning on or after the date of the adoption of the 
     amendment;
       ``(D) specify that, as of the amendment's effective date, 
     no further benefits shall accrue under the defined benefit 
     component of the multiemployer plan; and
       ``(E) specify that, as of the amendment's effective date, 
     the plan sponsor of the multiemployer plan shall be the plan 
     sponsor of both the composite plan component and the defined 
     benefit plan component of the plan.
       ``(3) Special rules.--If a multiemployer plan is amended 
     pursuant to paragraph (1)--
       ``(A) the requirements of this title and title IV shall be 
     applied to the composite plan component and the defined 
     benefit plan component of the multiemployer plan as if each 
     such component were maintained as a separate plan; and
       ``(B) the assets of the composite plan component and the 
     defined benefit plan component of the plan shall be held in a 
     single trust forming part of the plan under which the trust 
     instrument expressly provides--
       ``(i) for separate accounts (and appropriate records) to be 
     maintained to reflect the interest which each of the plan 
     components has in the trust, including separate accounting 
     for additions to the trust for the benefit of each plan 
     component, disbursements made from each plan component's 
     account in the trust, investment experience of the trust 
     allocable to that account, and administrative expenses 
     (whether direct expenses or shared expenses allocated 
     proportionally), and permits, but does not require, the 
     pooling of some or all of the assets of the two plan 
     components for investment purposes, subject to the judgment 
     of the plan fiduciaries; and
       ``(ii) that the assets of each of the two plan components 
     shall be held, invested, reinvested, managed, administered 
     and distributed for the exclusive benefit of the participants 
     and beneficiaries of each such plan component, and in no 
     event shall the assets of one of the plan components be 
     available to pay benefits due under the other plan component.
       ``(4) Not a termination event.--Notwithstanding section 
     4041A, an amendment pursuant to paragraph (1) to incorporate 
     the features of a composite plan as a component of a 
     multiemployer plan does not constitute termination of the 
     multiemployer plan.
       ``(5) Notice to the secretary.--
       ``(A) Notice.--The plan sponsor of a composite plan shall 
     provide notice to the Secretary of the intent to establish 
     the composite plan (or, in the case of a composite plan 
     incorporated as a component of a multiemployer plan as 
     described in paragraph (1), the intent to amend the 
     multiemployer plan to incorporate such composite plan) at 
     least 30 days prior to the effective date of such 
     establishment or amendment.
       ``(B) Certification.--In the case of a composite plan 
     incorporated as a component of a multiemployer plan as 
     described in paragraph (1), such notice shall include a 
     certification by the plan actuary under section 305(b)(4) 
     that the effective date of the amendment occurs in a plan 
     year for which the multiemployer plan is not in endangered or 
     critical status for that plan year and any of the succeeding 
     5 plan years.
       ``(6) References to composite plan component.--As used in 
     this part, the term `composite plan' includes a composite 
     plan component added to a defined benefit plan pursuant to 
     paragraph (1).
       ``(7) Rule of construction.--Paragraph (2)(A) shall not be 
     construed as preventing the plan sponsor of a multiemployer 
     plan from adopting an amendment pursuant to paragraph (1) 
     because some collective bargaining agreements are amended to 
     cease any covered employer's obligation to contribute to the 
     multiemployer plan before or after the plan amendment is 
     effective. Paragraph (2)(B) shall not be construed as 
     preventing the plan sponsor of a multiemployer plan from 
     adopting an amendment pursuant to paragraph (1) because some 
     participants cease to have contributions made to the 
     multiemployer plan on their behalf before or after the plan 
     amendment is effective.
       ``(c) Coordination With Funding Rules.--Except as otherwise 
     provided in this part, sections 302, 304, and 305 shall not 
     apply to a composite plan.
       ``(d) Treatment of a Composite Plan.--For purposes of this 
     Act (other than sections 302 and 4245), a composite plan 
     shall be treated as if it were a defined benefit plan unless 
     a different treatment is provided for under applicable law.

     ``SEC. 802. FUNDED RATIOS; ACTUARIAL ASSUMPTIONS.

       ``(a) Certification of Funded Ratios.--
       ``(1) In general.--Not later than the one-hundred twentieth 
     day of each plan year of a composite plan, the plan actuary 
     of the composite plan shall certify to the Secretary, the 
     Secretary of the Treasury, and the plan sponsor the plan's 
     current funded ratio and projected funded ratio for the plan 
     year.
       ``(2) Determination of current funded ratio and projected 
     funded ratio.--For purposes of this section:
       ``(A) Current funded ratio.--The current funded ratio is 
     the ratio (expressed as a percentage) of--
       ``(i) the value of the plan's assets as of the first day of 
     the plan year; to
       ``(ii) the plan actuary's calculation of the present value 
     of the plan liabilities as of the first day of the plan year.
       ``(B) Projected funded ratio.--The projected funded ratio 
     is the funded ratio determined under subparagraph (A), 
     projected as of the first day of the fifteenth plan year 
     following the plan year for which the determination is being 
     made.
       ``(3) Consideration of contribution rate increases.--For 
     purposes of projections under this subsection, the plan 
     actuary may anticipate contribution rate increases beyond the 
     term of the current collective bargaining agreement and any 
     agreed-to supplements, if reasonable, not to exceed 2.5 
     percent per year, compounded annually.
       ``(b) Actuarial Assumptions and Methods.--For purposes of 
     this part:
       ``(1) In general.--All costs, liabilities, rates of 
     interest, and other factors under the plan shall be 
     determined for a plan year on the basis of actuarial 
     assumptions and methods--
       ``(A) each of which is reasonable (taking into account the 
     experience of the plan and reasonable expectations);
       ``(B) which, in combination, offer the actuary's best 
     estimate of anticipated experience under the plan; and
       ``(C) with respect to which any change from the actuarial 
     assumptions and methods used in the previous plan year shall 
     be certified by the plan actuary and the actuarial rationale 
     for such change provided in the annual report required by 
     section 103.
       ``(2) Fair market value of assets.--The value of the plan's 
     assets shall be taken into account on the basis of their fair 
     market value.
       ``(3) Determination of normal cost and plan liabilities.--A 
     plan's normal cost and liabilities shall be based--
       ``(A) on the most recent actuarial valuation required under 
     section 801(a)(5)(A) and the unit credit funding method; and
       ``(B) on rates of interest subject to section 304(b)(6).
       ``(4) Time when certain contributions deemed made.--Any 
     contributions for a plan year made by an employer after the 
     last day of such plan year, but not later than 2\1/2\ months 
     after such day, shall be deemed to have been made on such 
     last day. For purposes of this paragraph, such 2\1/2\-month 
     period may be extended to a total of not more than 120 days 
     under regulations prescribed by the Secretary of the 
     Treasury.
       ``(5) Additional actuarial assumptions.--Except where 
     otherwise provided in this part, the provisions of section 
     305(b)(4)(B) shall apply to any determination or projection 
     under this part.

     ``SEC. 803. REALIGNMENT PROGRAM.

       ``(a) Realignment Program.--
       ``(1) Adoption.--In any case in which the plan actuary 
     certifies under section 802(a) that the plan's projected 
     funded ratio is below 120 percent for the plan year, the plan 
     sponsor shall adopt a realignment program under paragraph (2) 
     not later than 210 days after the due date of the 
     certification required under such section 802(a). The plan 
     sponsor shall adopt an updated realignment program for each 
     succeeding plan year for which a certification described in 
     the preceding sentence is made.
       ``(2) Content of realignment program.--
       ``(A) In general.--A realignment program adopted under this 
     paragraph is a written program which consists of reasonable 
     measures, including options or a range of options to be 
     undertaken by the plan sponsor or proposed to the bargaining 
     parties, formulated, based on reasonably anticipated 
     experience and reasonable actuarial assumptions, to enable 
     the plan to achieve a projected funded ratio of at least 120 
     percent for the following plan year.
       ``(B) Initial program elements.--Reasonable measures under 
     a realignment program described in subparagraph (A) may 
     include any of the following:
       ``(i) Proposed contribution increases.
       ``(ii) A reduction in the rate of future benefit accruals, 
     so long as the resulting rate is not less than 1 percent of 
     the contributions on which benefits are based as of the start 
     of the plan year (or the equivalent standard accrual rate as 
     described in section 305(f)(6)).
       ``(iii) A modification or elimination of adjustable 
     benefits of participants that are not in pay status before 
     the date of the notice required under subsection (b)(1).
       ``(iv) Any other lawfully available measures not 
     specifically described in this subparagraph or subparagraph 
     (C) or (D) that the plan sponsor determines are reasonable.

[[Page S7623]]

       ``(C) Additional program elements.--If the plan sponsor has 
     determined that all reasonable measures available under 
     subparagraph (B) will not enable the plan to achieve a 
     projected funded ratio of at least 120 percent for the 
     following plan year, the realignment program may also 
     include--
       ``(i) a reduction of accrued benefits that are not in pay 
     status by the date of the notice required under subsection 
     (b)(1); or
       ``(ii) a reduction of any benefits of participants that are 
     in pay status before the date of the notice required under 
     subsection (b)(1) other than core benefits as defined in 
     paragraph (4).
       ``(D) Additional elements.--In the case of a composite plan 
     for which the plan sponsor has determined that all reasonable 
     measures available under subparagraphs (B) and (C) will not 
     enable the plan to achieve a projected funded ratio of at 
     least 120 percent for the following plan year, the 
     realignment program may also include--
       ``(i) a further reduction in the rate of future benefit 
     accruals without regard to the limitation applicable under 
     subparagraph (B)(ii); or
       ``(ii) a reduction of core benefits;
     provided that such reductions shall be equitably distributed 
     across the participant and beneficiary population, taking 
     into account factors, with respect to participants and 
     beneficiaries and their benefits, that may include one or 
     more of the factors listed in subclauses (I) through (X) of 
     section 305(f)(9)(D)(vi), to the extent necessary to enable 
     the plan to achieve a projected funded ratio of at least 120 
     percent for the following plan year.
       ``(3) Adjustable benefit defined.--For purposes of this 
     part, the term `adjustable benefit' means--
       ``(A) benefits, rights, and features under the plan, 
     including post-retirement death benefits, disability benefits 
     not yet in pay status, and similar benefits,
       ``(B) any early retirement benefit or retirement-type 
     subsidy (within the meaning of section 204(g)(2)(A)) 
     (including early reduction factors which are not provided on 
     an actuarially equivalent basis) and any benefit payment 
     option (other than the qualified joint and survivor annuity),
       ``(C) benefit increases which were adopted (or, if later, 
     took effect) less than 120 months before the first day of the 
     first plan year in which such realignment program took 
     effect,
       ``(D) any one-time bonus payment or `thirteenth check' 
     provision, and
       ``(E) benefits granted for period of service prior to 
     participation in the plan.
       ``(4) Core benefit defined.--For purposes of this part, the 
     term `core benefit' means a participant's accrued benefit 
     payable in the normal form of an annuity commencing at normal 
     retirement age, determined without regard to--
       ``(A) any early retirement benefits, retirement-type 
     subsidies, or other benefits, rights, or features that may be 
     associated with that benefit; and
       ``(B) any cost-of-living adjustments or benefit increases 
     effective after the date of retirement.
       ``(5) Coordination with contribution increases.--
       ``(A) In general.--A realignment program may provide that 
     some or all of the benefit modifications described in the 
     program will only take effect if the bargaining parties fail 
     to agree to specified levels of increases in contributions to 
     the plan, effective as of specified dates.
       ``(B) Independent benefit modifications.--If a realignment 
     program adopts any changes to the benefit formula that are 
     independent of potential contribution increases, such changes 
     shall take effect not later than 180 days after the first day 
     of the first plan year that begins following the adoption of 
     the realignment program.
       ``(C) Conditional benefit modifications.--If a realignment 
     program adopts any changes to the benefit formula that take 
     effect only if the bargaining parties fail to agree to 
     contribution increases, such changes shall take effect not 
     later than the first day of the first plan year beginning 
     after the third anniversary of the date of adoption of the 
     realignment program.
       ``(D) Revocation of certain benefit modifications.--Benefit 
     modifications described in subparagraph (C) may be revoked, 
     in whole or in part, and retroactively or prospectively, when 
     contributions to the plan are increased, as specified in the 
     realignment program, including any amendments thereto. The 
     preceding sentence shall not apply unless the contribution 
     increases are to be effective not later than the fifth 
     anniversary of the first day of the first plan year that 
     begins after the adoption of the realignment program.
       ``(b) Notice.--
       ``(1) In general.--In any case in which it is certified 
     under section 802(a) that the projected funded ratio is less 
     than 120 percent, the plan sponsor shall, not later than 30 
     days after the date of the certification, provide 
     notification of the current and projected funded ratios to 
     the participants and beneficiaries, the bargaining parties, 
     the Secretary of the Treasury, and the Secretary. Such notice 
     shall include--
       ``(A) an explanation that contribution rate increases or 
     benefit reductions may be necessary;
       ``(B) a description of the types of benefits that might be 
     reduced; and
       ``(C) an estimate of the contribution increases and benefit 
     reductions that may be necessary to achieve a projected 
     funded ratio of 120 percent.
       ``(2) Notice of benefit modifications.--
       ``(A) In general.--No modifications may be made that reduce 
     the rate of future benefit accrual or that reduce core 
     benefits or adjustable benefits unless notice of such 
     reduction has been given at least 180 days before the general 
     effective date of such reduction for all participants and 
     beneficiaries to--
       ``(i) plan participants and beneficiaries;
       ``(ii) each employer who has an obligation to contribute to 
     the composite plan; and
       ``(iii) each employee organization which, for purposes of 
     collective bargaining, represents plan participants employed 
     by such employers.
       ``(B) Content of notice.--The notice under subparagraph (A) 
     shall contain--
       ``(i) sufficient information to enable participants and 
     beneficiaries to understand the effect of any reduction on 
     their benefits, including an illustration of any affected 
     benefit or subsidy, on an annual or monthly basis that a 
     participant or beneficiary would otherwise have been eligible 
     for as of the general effective date described in 
     subparagraph (A); and
       ``(ii) information as to the rights and remedies of plan 
     participants and beneficiaries as well as how to contact the 
     Department of the Treasury for further information and 
     assistance, where appropriate.
       ``(C) Form and manner.--Any notice under subparagraph (A)--
       ``(i) shall be provided in a form and manner prescribed in 
     regulations of the Secretary of the Treasury;
       ``(ii) shall be written in a manner so as to be understood 
     by the average plan participant.
       ``(3) Model notices.--The Secretary of the Treasury shall--
       ``(A) prescribe model notices that the plan sponsor of a 
     composite plan may use to satisfy the notice requirements 
     under this subsection; and
       ``(B) by regulation enumerate any details related to the 
     elements listed in paragraph (1) that any notice under this 
     subsection must include.
       ``(4) Delivery method.--Any notice under this part shall be 
     provided in writing and may be provided in electronic form to 
     the extent that the form is reasonably accessible to persons 
     to whom the notice is provided.

     ``SEC. 804. LIMITATION ON INCREASING BENEFITS.

       ``(a) Level of Current Funded Ratios.--Except as provided 
     in subsections (c), (d), and (e), no plan amendment 
     increasing benefits or establishing new benefits under a 
     composite plan may be adopted for a plan year unless--
       ``(1) the plan's current funded ratio is at least 110 
     percent (without regard to the benefit increase or new 
     benefits);
       ``(2) taking the benefit increase or new benefits into 
     account, the current funded ratio is at least 100 percent and 
     the projected funded ratio for the current plan year is at 
     least 120 percent;
       ``(3) in any case in which, after taking the benefit 
     increase or new benefits into account, the current funded 
     ratio is less than 140 percent and the projected funded ratio 
     is less than 140 percent, the benefit increase or new 
     benefits are projected by the plan actuary to increase the 
     present value of the plan's liabilities for the plan year by 
     not more than 3 percent; and
       ``(4) expected contributions for the current plan year are 
     at least 120 percent of normal cost for the plan year, 
     determined using the unit credit funding method and treating 
     the benefit increase or new benefits as in effect for the 
     entire plan year.
       ``(b) Additional Requirements Where Core Benefits 
     Reduced.--If a plan has been amended to reduce core benefits 
     pursuant to a realignment program under section 803(a)(2)(D), 
     such plan may not be subsequently amended to increase core 
     benefits unless the amendment--
       ``(1) increases the level of future benefit payments only; 
     and
       ``(2) provides for an equitable distribution of benefit 
     increases across the participant and beneficiary population, 
     taking into account the extent to which the benefits of 
     participants were previously reduced pursuant to such 
     realignment program.
       ``(c) Exception To Comply With Applicable Law.--Subsection 
     (a) shall not apply in connection with a plan amendment if 
     the amendment is required as a condition of qualification 
     under part I of subchapter D of chapter 1 of the Internal 
     Revenue Code of 1986 or to comply with other applicable law.
       ``(d) Exception Where Maximum Deductible Limit Applies.--
     Subsection (a) shall not apply in connection with a plan 
     amendment if and to the extent that contributions to the 
     composite plan would not be deductible for the plan year 
     under section 404(a)(1)(E) of the Internal Revenue Code of 
     1986 if the plan amendment is not adopted.
       ``(e) Exception for Certain Benefit Modifications.--
     Subsection (a) shall not apply in connection with a plan 
     amendment under section 803(a)(5)(C), regarding conditional 
     benefit modifications.
       ``(f) Treatment of Plan Amendments.--For purposes of this 
     section--
       ``(1) if two or more plan amendments increasing benefits or 
     establishing new benefits are adopted in a plan year, such 
     amendments shall be treated as a single amendment adopted on 
     the last day of the plan year;
       ``(2) all benefit increases and new benefits adopted in a 
     single amendment are treated

[[Page S7624]]

     as a single benefit increase, irrespective of whether the 
     increases and new benefits take effect in more than one plan 
     year; and
       ``(3) increases in contributions or decreases in plan 
     liabilities which are scheduled to take effect in future plan 
     years may be taken into account in connection with a plan 
     amendment if they have been agreed to in writing or otherwise 
     formalized by the date the plan amendment is adopted.

     ``SEC. 805. COMPOSITE PLAN RESTRICTIONS TO PRESERVE LEGACY 
                   PLAN FUNDING.

       ``(a) Treatment as a Legacy Plan.--
       ``(1) In general.--For purposes of this part and parts 2 
     and 3, a defined benefit plan shall be treated as a legacy 
     plan with respect to the composite plan under which employees 
     who were eligible to accrue a benefit under the defined 
     benefit plan become eligible to accrue a benefit under such 
     composite plan.
       ``(2) Component plans.--In any case in which a defined 
     benefit plan is amended to add a composite plan component 
     pursuant to section 801(b), paragraph (1) shall be applied by 
     substituting `defined benefit component' for `defined benefit 
     plan' and `composite plan component' for `composite plan'.
       ``(3) Eligible to accrue a benefit.--For purposes of 
     paragraph (1), an employee is considered eligible to accrue a 
     benefit under a composite plan as of the first day in which 
     the employee completes an hour of service under a collective 
     bargaining agreement that provides for contributions to and 
     accruals under the composite plan in lieu of accruals under 
     the defined benefit plan.
       ``(4) Collective bargaining agreement.--As used in this 
     part, the term `collective bargaining agreement' includes any 
     agreement under which an employer has an obligation to 
     contribute to a plan.
       ``(5) Other terms.--Any term used in this part which is not 
     defined in this part and which is also used in section 305 
     shall have the same meaning provided such term in such 
     section.
       ``(b) Restrictions on Acceptance by Composite Plan of 
     Agreements and Contributions.--
       ``(1) In general.--The plan sponsor of a composite plan 
     shall not accept or recognize a collective bargaining 
     agreement (or any modification to such agreement), and no 
     contributions may be accepted and no benefits may be accrued 
     or otherwise earned under the agreement--
       ``(A) in any case in which the plan actuary of any defined 
     benefit plan that would be treated as a legacy plan with 
     respect to such composite plan has certified under section 
     305(b)(4) that such defined benefit plan is or will be in 
     endangered or critical status for the plan year in which such 
     agreement would take effect or for any of the succeeding 5 
     plan years; and
       ``(B) unless the agreement requires each employer who is a 
     party to such agreement, including employers whose employees 
     are not participants in the legacy plan, to provide 
     contributions to the legacy plan with respect to such 
     composite plan in a manner that satisfies the transition 
     contribution requirements of subsection (d).
       ``(2) Notice.--Not later than 30 days after a determination 
     by a plan sponsor of a composite plan that an agreement fails 
     to satisfy the requirements described in paragraph (1), the 
     plan sponsor shall provide notification of such failure and 
     the reasons for such determination--
       ``(A) to the parties to the agreement;
       ``(B) to active participants of the composite plan who have 
     ceased to accrue or otherwise earn benefits with respect to 
     service with an employer pursuant to paragraph (1); and
       ``(C) to the Secretary, the Secretary of the Treasury, and 
     the Pension Benefit Guaranty Corporation.
       ``(3) Limitation on retroactive effect.--This subsection 
     shall not apply to benefits accrued before the date on which 
     notice is provided under paragraph (2).
       ``(c) Restriction on Accrual of Benefits Under a Composite 
     Plan.--
       ``(1) In general.--In any case in which an employer, under 
     a collective bargaining agreement entered into after the date 
     of enactment of this part, ceases to have an obligation to 
     contribute to a multiemployer defined benefit plan, no 
     employees employed by the employer may accrue or otherwise 
     earn benefits under any composite plan, with respect to 
     service with that employer, for a 60-month period beginning 
     on the date on which the employer entered into such 
     collective bargaining agreement.
       ``(2) Notice of cessation of obligation.--Within 30 days of 
     determining that an employer has ceased to have an obligation 
     to contribute to a legacy plan with respect to employees 
     employed by an employer that is or will be contributing to a 
     composite plan with respect to service of such employees, the 
     plan sponsor of the legacy plan shall notify the plan sponsor 
     of the composite plan of that cessation.
       ``(3) Notice of cessation of accruals.--Not later than 30 
     days after determining that an employer has ceased to have an 
     obligation to contribute to a legacy plan, the plan sponsor 
     of the composite plan shall notify the bargaining parties, 
     the active participants affected by the cessation of 
     accruals, the Secretary, the Secretary of the Treasury, and 
     the Pension Benefit Guaranty Corporation of the cessation of 
     accruals, the period during which such cessation is in 
     effect, and the reasons therefor.
       ``(4) Limitation on retroactive effect.--This subsection 
     shall not apply to benefits accrued before the date on which 
     notice is provided under paragraph (3).
       ``(d) Transition Contribution Requirements.--
       ``(1) In general.--A collective bargaining agreement 
     satisfies the transition contribution requirements of this 
     subsection if the agreement--
       ``(A) authorizes payment of contributions to a legacy plan 
     at a rate, or multiple rates, as described in paragraph 
     (2)(B), equal to or greater than the transition contribution 
     rate established by the legacy plan under paragraph (2); and
       ``(B) does not provide for--
       ``(i) a suspension of contributions to the legacy plan with 
     respect to any period of service; or
       ``(ii) any new direct or indirect exclusion of younger or 
     newly hired employees of the employer from being taken into 
     account in determining contributions owed to the legacy plan.
       ``(2) Transition contribution rate.--
       ``(A) In general.--The transition contribution rate for a 
     plan year is the contribution rate that, as certified by the 
     actuary of the legacy plan in accordance with the principles 
     in section 305(b)(4)(B), is reasonably expected to be 
     adequate--
       ``(i) to fund the normal cost for the plan year;
       ``(ii) to amortize the plan's unfunded liabilities in level 
     annual installments over 25 years, beginning with the plan 
     year in which the transition contribution rate is first 
     established; and
       ``(iii) to amortize any subsequent changes in the legacy 
     plan's unfunded liability due to experience gains or losses 
     (including investment gains or losses, gains or losses due to 
     contributions greater or less than the contributions made 
     under the prior transition contribution rate, and other 
     actuarial gains or losses), changes in actuarial assumptions, 
     changes to the legacy plan's benefits, or changes in funding 
     method over a period of 15 plan years beginning with the plan 
     year following the plan year in which such change in unfunded 
     liability is incurred, unless otherwise prescribed.
     The transition contribution rate for any plan year may not be 
     less than the transition contribution rate for the plan year 
     in which such rate is first established.
       ``(B) Multiple rates.--If different rates of contribution 
     are payable to the legacy plan by different employers or for 
     different classes of employees, the certification by the 
     actuary of the legacy plan shall specify a transition 
     contribution rate for each such employer or class of 
     employees.
       ``(C) Rate applicable to employer.--
       ``(i) In general.--Except as provided by clause (ii), the 
     transition contribution rate applicable to an employer for a 
     plan year is the rate in effect for the plan year of the 
     legacy plan that commences on or after 180 days before the 
     earlier of--

       ``(I) the effective date of the collective bargaining 
     agreement pursuant to which the employer contributes to the 
     legacy plan; or
       ``(II) 5 years after the last plan year for which the 
     transition contribution rate applicable to the employer was 
     established or updated.

       ``(ii) Exception.--The transition contribution rate 
     applicable to an employer for the first plan year beginning 
     on or after the commencement of the employer's obligation to 
     contribute to the composite plan is the rate in effect for 
     the plan year of the legacy plan that commences on or after 
     180 days before such first plan year.
       ``(D) Effect of legacy plan financial circumstances.--If 
     the plan actuary of the legacy plan has certified under 
     section 305 that the plan is in endangered or critical status 
     for a plan year, the transition contribution rate for the 
     following plan year is the rate determined with respect to 
     the employer under the legacy plan's funding improvement or 
     rehabilitation plan under section 305, if greater than the 
     rate otherwise determined, but in no event shall the 
     transition contribution rate be greater than 75 percent of 
     the sum of the contribution rates applicable to the legacy 
     plan and the composite plan for the plan year. 
     Notwithstanding the preceding sentence, if the transition 
     contribution rate in the prior year is more than 75 percent 
     of the sum of the contribution rates applicable to the legacy 
     plan and the composite plan for the prior plan year, the 
     transition contribution rate applicable to the legacy plan 
     shall not be subject to the 75-percent limitation, but shall 
     be neither increased nor reduced as a percentage of the sum 
     of the contribution rates applicable to the legacy plan and 
     the composite plan for the plan year.
       ``(E) Other actuarial assumptions and methods.--Except as 
     provided in subparagraph (A), the determination of the 
     transition contribution rate for a plan year shall be based 
     on actuarial assumptions and methods consistent with the 
     minimum funding determinations made under section 304 (or, if 
     applicable, section 305) with respect to the legacy plan for 
     the plan year.
       ``(F) Adjustments in rate.--The plan sponsor of a legacy 
     plan from time to time may adjust the transition contribution 
     rate or rates applicable to an employer under this paragraph 
     by increasing some rates and decreasing others if the actuary 
     certifies that such adjusted rates in combination will 
     produce projected contribution income for the plan year 
     beginning on or after the date of certification that is not 
     less than would be produced by the transition contribution

[[Page S7625]]

     rates in effect at the time of the certification.
       ``(G) Notice of transition contribution rate.--The plan 
     sponsor of a legacy plan shall provide notice to the parties 
     to collective bargaining agreements pursuant to which 
     contributions are made to the legacy plan of changes to the 
     transition contribution rate requirements at least 30 days 
     before the beginning of the plan year for which the rate is 
     effective.
       ``(H) Notice to composite plan sponsor.--Not later than 30 
     days after a determination by the plan sponsor of a legacy 
     plan that a collective bargaining agreement provides for a 
     rate of contributions that is below the transition 
     contribution rate applicable to one or more employers that 
     are parties to the collective bargaining agreement, the plan 
     sponsor of the legacy plan shall notify the plan sponsor of 
     any composite plan under which employees of such employer 
     would otherwise be eligible to accrue a benefit.
       ``(3) Correction procedures.--Pursuant to standards 
     prescribed by the Secretary, the plan sponsor of a composite 
     plan shall adopt rules and procedures that give the parties 
     to the collective bargaining agreement notice of the failure 
     of such agreement to satisfy the transition contribution 
     requirements of this subsection, and a reasonable opportunity 
     to correct such failure, not to exceed 180 days from the date 
     of notice given under subsection (b)(2).
       ``(4) Supplemental contributions.--A collective bargaining 
     agreement may provide for supplemental contributions to the 
     legacy plan for a plan year in excess of the transition 
     contribution rate determined under paragraph (2), regardless 
     of whether the legacy plan is in endangered or critical 
     status for such plan year.
       ``(e) Nonapplication of Composite Plan Restrictions.--
       ``(1) In general.--The provisions of subsections (a), (b), 
     and (c) shall not apply with respect to a collective 
     bargaining agreement, to the extent the agreement, or a 
     predecessor agreement, provides or provided for contributions 
     to a defined benefit plan that is a legacy plan, as of the 
     first day of the first plan year following a plan year for 
     which the plan actuary certifies that the plan is fully 
     funded, has been fully funded for at least three out of the 
     immediately preceding 5 plan years, and is projected to 
     remain fully funded for at least the following 4 plan years.
       ``(2) Determination of fully funded.--A plan is fully 
     funded for purposes of paragraph (1) if, as of the valuation 
     date of the plan for a plan year, the value of the plan's 
     assets equals or exceeds the present value of the plan's 
     liabilities, determined in accordance with the rules 
     prescribed by the Pension Benefit Guaranty Corporation under 
     sections 4219(c)(1)(D) and 4281 for multiemployer plans 
     terminating by mass withdrawal, as in effect for the date of 
     the determination, except the plan's reasonable assumption 
     regarding the starting date of benefits may be used.
       ``(3) Other applicable rules.--Except as provided in 
     paragraph (2), actuarial determinations and projections under 
     this section shall be based on the rules in section 802(b).

     ``SEC. 806. MERGERS AND ASSET TRANSFERS OF COMPOSITE PLANS.

       ``(a) In General.--Assets and liabilities of a composite 
     plan may only be merged with, or transferred to, another plan 
     if--
       ``(1) the other plan is a composite plan;
       ``(2) the plan or plans resulting from the merger or 
     transfer is a composite plan;
       ``(3) no participant's accrued benefit or adjustable 
     benefit is lower immediately after the transaction than it 
     was immediately before the transaction; and
       ``(4) the value of the assets transferred in the case of a 
     transfer reasonably reflects the value of the amounts 
     contributed with respect to the participants whose benefits 
     are being transferred, adjusted for allocable distributions, 
     investment gains and losses, and administrative expenses.
     A plan which is not a composite plan may not merge with or 
     transfer assets and liabilities to a composite plan.
       ``(b) Legacy Plan.--
       ``(1) In general.--After a merger or transfer involving a 
     composite plan, the legacy plan with respect to an employer 
     that is obligated to contribute to the resulting composite 
     plan is the legacy plan that applied to that employer 
     immediately before the merger or transfer.
       ``(2) Multiple legacy plans.--If an employer is obligated 
     to contribute to more than one legacy plan with respect to 
     employees eligible to accrue benefits under more than one 
     composite plan and there is a merger or transfer of such 
     legacy plans, the transition contribution rate applicable to 
     the legacy plan resulting from the merger or transfer with 
     respect to that employer shall be determined in accordance 
     with the provisions of section 805(d)(2)(B).''.
       (2) Penalties.--
       (A) Civil enforcement of failure to comply with realignment 
     program.--Section 502(a) of such Act (29 U.S.C. 1132(a)) is 
     amended--
       (i) in paragraph (10), by striking ``or'' at the end;
       (ii) in paragraph (11), by striking the period at the end 
     and inserting ``; or''; and
       (iii) by adding at the end the following:
       ``(12) in the case of a composite plan required to adopt a 
     realignment program under section 803, if the plan sponsor--
       ``(A) has not adopted a realignment program under that 
     section by the deadline established in such section; or
       ``(B) fails to update or comply with the terms of the 
     realignment program in accordance with the requirements of 
     such section,
     by the Secretary, by an employer that has an obligation to 
     contribute with respect to the composite plan, or by an 
     employee organization that represents active participants in 
     the composite plan, for an order compelling the plan sponsor 
     to adopt a realignment program, or to update or comply with 
     the terms of the realignment program, in accordance with the 
     requirements of such section and the realignment program.''.
       (B) Civil penalties.--Section 502(c) of such Act (29 U.S.C. 
     1132(c)), as amended by this Act, is further amended--
       (i) by moving paragraphs (8), (10), and (12) each 2 ems to 
     the left;
       (ii) by redesignating paragraphs (9) through (13) as 
     paragraphs (12) through (16), respectively; and
       (iii) by inserting after paragraph (8) the following:
       ``(9) The Secretary may assess against any plan sponsor of 
     a composite plan a civil penalty of not more than $2,140 per 
     day for each violation by such sponsor--
       ``(A) of the requirement under section 801(a)(5)(D) to 
     furnish an annual notification to each participant;
       ``(B) of the requirement under section 802(a) on the plan 
     actuary to certify the plan's current or projected funded 
     ratio by the date specified in such subsection; or
       ``(C) of the requirement under section 803 to adopt a 
     realignment program by the deadline established in that 
     section and to comply with its terms.
       ``(10)(A) The Secretary may assess against any plan sponsor 
     of a composite plan a civil penalty of not more than $100 per 
     day for each violation by such sponsor of the requirement 
     under section 803(b) to provide notice as described in such 
     section, except that no penalty may be assessed in any case 
     in which the plan sponsor exercised reasonable diligence to 
     meet the requirements of such section and--
       ``(i) the plan sponsor did not know that the violation 
     existed; or
       ``(ii) the plan sponsor provided such notice during the 30-
     day period beginning on the first date on which the plan 
     sponsor knew, or in exercising reasonable due diligence 
     should have known, that such violation existed.
       ``(B) In any case in which the plan sponsor exercised 
     reasonable diligence to meet the requirements of section 
     803(b), the Secretary may waive part or all of such penalty 
     to the extent that the payment of such penalty would be 
     excessive or otherwise inequitable relative to the violation 
     involved.
       ``(11) The Secretary may assess against any plan sponsor of 
     a composite plan a civil penalty of not more than $100 per 
     day for each violation by such sponsor of the notice 
     requirements under sections 801(b)(5) and 805(b)(2).''.
       (3) Authorities.--Section 101(a) of Reorganization Plan No. 
     4 of 1978 (29 U.S.C. 1001 note) is amended by striking 
     ``Parts 2 and 3'' and inserting ``Parts 2, 3, and 8''.
       (4) Conforming amendment.--The table of contents in section 
     1 of such Act (29 U.S.C. 1001 note) is amended by inserting 
     after the item relating to section 734 the following:

               ``Part 8--Composite Plans and Legacy Plans

``Sec. 801. Composite plan defined.
``Sec. 802. Funded ratios; actuarial assumptions.
``Sec. 803. Realignment program.
``Sec. 804. Limitation on increasing benefits.
``Sec. 805. Composite plan restrictions to preserve legacy plan 
              funding.
``Sec. 806. Mergers and asset transfers of composite plans.''.
       (b) Amendment to the Internal Revenue Code of 1986.--
       (1) In general.--Subchapter D of chapter 1 of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following:

              ``PART IV--COMPOSITE PLANS AND LEGACY PLANS

``Sec. 437. Composite plan defined.
``Sec. 438. Funded ratios; actuarial assumptions.
``Sec. 439. Realignment program.
``Sec. 440. Limitation on increasing benefits.
``Sec. 440A. Composite plan restrictions to preserve legacy plan 
              funding.
``Sec. 440B. Mergers and asset transfers of composite plans.

     ``SEC. 437. COMPOSITE PLAN DEFINED.

       ``(a) In General.--For purposes of this title, the term 
     `composite plan' means a pension plan--
       ``(1) which is a multiemployer plan that is neither a 
     defined benefit plan nor a defined contribution plan,
       ``(2) the terms of which provide that the plan is a 
     composite plan for purposes of this title with respect to 
     which not more than one multiemployer defined benefit plan is 
     treated as a legacy plan within the meaning of section 440A, 
     unless there is more than one legacy plan following a merger 
     of composite plans under section 440B,
       ``(3) which provides systematically for the payment of 
     benefits--
       ``(A) objectively calculated pursuant to a nondiscretionary 
     formula specified in the plan document with respect to plan 
     participants for life; and
       ``(B) in the form of life annuities, except for benefits 
     which under section 411(a)(11) may be immediately distributed 
     without the consent of the participant;
       ``(4) for which the anticipated employer contributions to 
     the plan for the first plan

[[Page S7626]]

     year are at least 120 percent of the normal cost for the plan 
     year;
       ``(5) which requires--
       ``(A) an annual valuation of the liability of the plan as 
     of a date within the plan year to which the valuation refers 
     or within one month prior to the beginning of such year,
       ``(B) an annual actuarial determination of the plan's 
     current funded ratio and projected funded ratio under section 
     438(a),
       ``(C) corrective action through a realignment program 
     pursuant to section 439 whenever the plan's projected funded 
     ratio is below 120 percent for the plan year, and
       ``(D) an annual notification to each participant describing 
     benefits under the plan and explaining that such benefits may 
     be subject to reduction under a realignment program pursuant 
     to section 439 based on the plan's funded status in future 
     plan years; and
       ``(6) the board of trustees of which includes at least one 
     retiree or beneficiary in pay status during each plan year 
     following the first plan year in which at least 5 percent of 
     the participants in the plan are retirees or beneficiaries in 
     pay status.
       ``(b) Transition From a Multiemployer Defined Benefit 
     Plan.--
       ``(1) In general.--The plan sponsor of a defined benefit 
     plan that is a multiemployer plan may, subject to paragraph 
     (2), amend the plan to incorporate the features of a 
     composite plan as a component of the multiemployer plan 
     separate from the defined benefit plan component, except in 
     the case of a defined benefit plan for which the plan actuary 
     has certified under section 432(b)(4) that the plan is or 
     will be in endangered or critical status for the plan year in 
     which such amendment would become effective or in endangered 
     or critical status for any of the succeeding 5 plan years.
       ``(2) Requirements.--Any amendment pursuant to paragraph 
     (1) to incorporate the features of a composite plan as a 
     component of a multiemployer plan shall--
       ``(A) apply with respect to all collective bargaining 
     agreements providing for contributions to the multiemployer 
     plan on or after the effective date of the amendment,
       ``(B) apply with respect to all participants in the 
     multiemployer plan for whom contributions are made to the 
     multiemployer plan on or after the effective date of the 
     amendment,
       ``(C) specify that the effective date of the amendment is--
       ``(i) the first day of a specified plan year following the 
     date of the adoption of the amendment, except that the plan 
     sponsor may alternatively provide for a separate effective 
     date with respect to each collective bargaining agreement 
     under which contributions to the multiemployer plan are 
     required, which shall occur on the first day of the first 
     plan year beginning after the termination, or if earlier, the 
     re-opening, of each such agreement, or such earlier date as 
     the parties to the agreement and the plan sponsor of the 
     multiemployer plan shall agree to, and
       ``(ii) not later than the first day of the fifth plan year 
     beginning on or after the date of the adoption of the 
     amendment,
       ``(D) specify that, as of the amendment's effective date, 
     no further benefits shall accrue under the defined benefit 
     component of the multiemployer plan, and
       ``(E) specify that, as of the amendment's effective date, 
     the plan sponsor of the multiemployer plan shall be the plan 
     sponsor of both the composite plan component and the defined 
     benefit plan component of the plan.
       ``(3) Special rules.--If a multiemployer plan is amended 
     pursuant to paragraph (1)--
       ``(A) the requirements of this title shall be applied to 
     the composite plan component and the defined benefit plan 
     component of the multiemployer plan as if each such component 
     were maintained as a separate plan, and
       ``(B) the assets of the composite plan component and the 
     defined benefit plan component of the plan shall be held in a 
     single trust forming part of the plan under which the trust 
     instrument expressly provides--
       ``(i) for separate accounts (and appropriate records) to be 
     maintained to reflect the interest which each of the plan 
     components has in the trust, including separate accounting 
     for additions to the trust for the benefit of each plan 
     component, disbursements made from each plan component's 
     account in the trust, investment experience of the trust 
     allocable to that account, and administrative expenses 
     (whether direct expenses or shared expenses allocated 
     proportionally), and permits, but does not require, the 
     pooling of some or all of the assets of the two plan 
     components for investment purposes, subject to the judgment 
     of the plan fiduciaries, and
       ``(ii) that the assets of each of the two plan components 
     shall be held, invested, reinvested, managed, administered 
     and distributed for the exclusive benefit of the participants 
     and beneficiaries of each such plan component, and in no 
     event shall the assets of one of the plan components be 
     available to pay benefits due under the other plan component.
       ``(4) Not a termination event.--Notwithstanding section 
     4041A of the Employee Retirement Income Security Act of 1974, 
     an amendment pursuant to paragraph (1) to incorporate the 
     features of a composite plan as a component of a 
     multiemployer plan does not constitute termination of the 
     multiemployer plan.
       ``(5) Notice to the secretary of labor.--
       ``(A) Notice.--The plan sponsor of a composite plan shall 
     provide notice to the Secretary of Labor of the intent to 
     establish the composite plan (or, in the case of a composite 
     plan incorporated as a component of a multiemployer plan as 
     described in paragraph (1), the intent to amend the 
     multiemployer plan to incorporate such composite plan) at 
     least 30 days prior to the effective date of such 
     establishment or amendment.
       ``(B) Certification.--In the case of a composite plan 
     incorporated as a component of a multiemployer plan as 
     described in paragraph (1), such notice shall include a 
     certification by the plan actuary under section 432(b)(4) 
     that the effective date of the amendment occurs in a plan 
     year for which the multiemployer plan is not in endangered or 
     critical status for that plan year and any of the succeeding 
     5 plan years.
       ``(6) References to composite plan component.--As used in 
     this part, the term `composite plan' includes a composite 
     plan component added to a defined benefit plan pursuant to 
     paragraph (1).
       ``(7) Rule of construction.--Paragraph (2)(A) shall not be 
     construed as preventing the plan sponsor of a multiemployer 
     plan from adopting an amendment pursuant to paragraph (1) 
     because some collective bargaining agreements are amended to 
     cease any covered employer's obligation to contribute to the 
     multiemployer plan before or after the plan amendment is 
     effective. Paragraph (2)(B) shall not be construed as 
     preventing the plan sponsor of a multiemployer plan from 
     adopting an amendment pursuant to paragraph (1) because some 
     participants cease to have contributions made to the 
     multiemployer plan on their behalf before or after the plan 
     amendment is effective.
       ``(c) Coordination With Funding Rules.--Except as otherwise 
     provided in this part, sections 412, 431, and 432 shall not 
     apply to a composite plan.
       ``(d) Treatment of a Composite Plan.--For purposes of this 
     title (other than sections 412 and 418E), a composite plan 
     shall be treated as if it were a defined benefit plan unless 
     a different treatment is provided for under applicable law.

     ``SEC. 438. FUNDED RATIOS; ACTUARIAL ASSUMPTIONS.

       ``(a) Certification of Funded Ratios.--
       ``(1) In general.--Not later than the one-hundred twentieth 
     day of each plan year of a composite plan, the plan actuary 
     of the composite plan shall certify to the Secretary, the 
     Secretary of Labor, and the plan sponsor the plan's current 
     funded ratio and projected funded ratio for the plan year.
       ``(2) Determination of current funded ratio and projected 
     funded ratio.--For purposes of this section--
       ``(A) Current funded ratio.--The current funded ratio is 
     the ratio (expressed as a percentage) of--
       ``(i) the value of the plan's assets as of the first day of 
     the plan year, to
       ``(ii) the plan actuary's calculation of the present value 
     of the plan liabilities as of the first day of the plan year.
       ``(B) Projected funded ratio.--The projected funded ratio 
     is the funded ratio determined under subparagraph (A), 
     projected as of the first day of the fifteenth plan year 
     following the plan year for which the determination is being 
     made.
       ``(3) Consideration of contribution rate increases.--For 
     purposes of projections under this subsection, the plan 
     actuary may anticipate contribution rate increases beyond the 
     term of the current collective bargaining agreement and any 
     agreed-to supplements, if reasonable, not to exceed 2.5 
     percent per year, compounded annually.
       ``(b) Actuarial Assumptions and Methods.--For purposes of 
     this part--
       ``(1) In general.--All costs, liabilities, rates of 
     interest, and other factors under the plan shall be 
     determined for a plan year on the basis of actuarial 
     assumptions and methods--
       ``(A) each of which is reasonable (taking into account the 
     experience of the plan and reasonable expectations),
       ``(B) which, in combination, offer the actuary's best 
     estimate of anticipated experience under the plan, and
       ``(C) with respect to which any change from the actuarial 
     assumptions and methods used in the previous plan year shall 
     be certified by the plan actuary and the actuarial rationale 
     for such change provided in the annual report required by 
     section 6058.
       ``(2) Fair market value of assets.--The value of the plan's 
     assets shall be taken into account on the basis of their fair 
     market value.
       ``(3) Determination of normal cost and plan liabilities.--A 
     plan's normal cost and liabilities shall be based on--
       ``(A) the most recent actuarial valuation required under 
     section 437(a)(5)(A) and the unit credit funding method; and
       ``(B) rates of interest subject to section 431(b)(6).
       ``(4) Time when certain contributions deemed made.--Any 
     contributions for a plan year made by an employer after the 
     last day of such plan year, but not later than 2\1/2\ months 
     after such day, shall be deemed to have been made on such 
     last day. For purposes of this paragraph, such 2\1/2\-month 
     period may be extended to a total of not more than 120 days 
     under regulations prescribed by the Secretary.
       ``(5) Additional actuarial assumptions.--Except where 
     otherwise provided in this part, the provisions of section 
     432(b)(4)(B) shall apply to any determination or projection 
     under this part.

     ``SEC. 439. REALIGNMENT PROGRAM.

       ``(a) Realignment Program.--

[[Page S7627]]

       ``(1) Adoption.--In any case in which the plan actuary 
     certifies under section 438(a) that the plan's projected 
     funded ratio is below 120 percent for the plan year, the plan 
     sponsor shall adopt a realignment program under paragraph (2) 
     not later than 210 days after the due date of the 
     certification required under section 438(a). The plan sponsor 
     shall adopt an updated realignment program for each 
     succeeding plan year for which a certification described in 
     the preceding sentence is made.
       ``(2) Content of realignment program.--
       ``(A) In general.--A realignment program adopted under this 
     paragraph is a written program which consists of reasonable 
     measures, including options or a range of options to be 
     undertaken by the plan sponsor or proposed to the bargaining 
     parties, formulated, based on reasonably anticipated 
     experience and reasonable actuarial assumptions, to enable 
     the plan to achieve a projected funded ratio of at least 120 
     percent for the following plan year.
       ``(B) Initial program elements.--Reasonable measures under 
     a realignment program described in subparagraph (A) may 
     include any of the following:
       ``(i) Proposed contribution increases.
       ``(ii) A reduction in the rate of future benefit accruals, 
     so long as the resulting rate shall not be less than 1 
     percent of the contributions on which benefits are based as 
     of the start of the plan year (or the equivalent standard 
     accrual rate as described in section 432(f)(6)).
       ``(iii) A modification or elimination of adjustable 
     benefits of participants that are not in pay status before 
     the date of the notice required under subsection (b)(1).
       ``(iv) Any other legally available measures not 
     specifically described in this subparagraph or subparagraph 
     (C) or (D) that the plan sponsor determines are reasonable.
       ``(C) Additional program elements.--If the plan sponsor has 
     determined that all reasonable measures available under 
     subparagraph (B) will not enable the plan to achieve a 
     projected funded ratio of at least 120 percent the following 
     plan year, such realignment program may also include--
       ``(i) a reduction of accrued benefits that are not in pay 
     status by the date of the notice required under subsection 
     (b)(1), or
       ``(ii) a reduction of any benefits of participants that are 
     in pay status before the date of the notice required under 
     subsection (b)(1) other than core benefits as defined in 
     paragraph (4).
       ``(D) Additional reductions.--In the case of a composite 
     plan for which the plan sponsor has determined that all 
     reasonable measures available under subparagraphs (B) and (C) 
     will not enable the plan to achieve a projected funded ratio 
     of at least 120 percent for the following plan year, the 
     realignment program may also include--
       ``(i) a further reduction in the rate of future benefit 
     accruals without regard to the limitation applicable under 
     subparagraph (B)(ii), or
       ``(ii) a reduction of core benefits,
     provided that such reductions shall be equitably distributed 
     across the participant and beneficiary population, taking 
     into account factors, with respect to participants and 
     beneficiaries and their benefits, that may include one or 
     more of the factors listed in subclauses (I) through (X) of 
     section 432(f)(9)(D)(vi), to the extent necessary to enable 
     the plan to achieve a projected funded ratio of at least 120 
     percent for the following plan year.
       ``(3) Adjustable benefit defined.--For purposes of this 
     part, the term `adjustable benefit' means--
       ``(A) benefits, rights, and features under the plan, 
     including post-retirement death benefits, disability benefits 
     not yet in pay status, and similar benefits,
       ``(B) any early retirement benefit or retirement-type 
     subsidy (within the meaning of section 411(d)(6)(B)(i)) 
     (including early reduction factors which are not provided on 
     an actuarially equivalent basis) and any benefit payment 
     option (other than the qualified joint and survivor annuity),
       ``(C) benefit increases which were adopted (or, if later, 
     took effect) less than 120 months before the first day of the 
     first plan year in which such realignment program took 
     effect,
       ``(D) any one-time bonus payment or `thirteenth check' 
     provision, and
       ``(E) benefits granted for period of service prior to 
     participation in the plan.
       ``(4) Core benefit defined.--For purposes of this part, the 
     term `core benefit' means a participant's accrued benefit 
     payable in the normal form of an annuity commencing at normal 
     retirement age, determined without regard to--
       ``(A) any early retirement benefits, retirement-type 
     subsidies, or other benefits, rights, or features that may be 
     associated with that benefit, and
       ``(B) any cost-of-living adjustments or benefit increases 
     effective after the date of retirement.
       ``(5) Coordination with contribution increases.--
       ``(A) In general.--A realignment program may provide that 
     some or all of the benefit modifications described in the 
     program will only take effect if the bargaining parties fail 
     to agree to specified levels of increases in contributions to 
     the plan, effective as of specified dates.
       ``(B) Independent benefit modifications.--If a realignment 
     program adopts any changes to the benefit formula that are 
     independent of potential contribution increases, such changes 
     shall take effect not later than 180 days following the first 
     day of the first plan year that begins following the adoption 
     of the realignment program.
       ``(C) Conditional benefit modifications.--If a realignment 
     program adopts any changes to the benefit formula that take 
     effect only if the bargaining parties fail to agree to 
     contribution increases, such changes shall take effect not 
     later than the first day of the first plan year beginning 
     after the third anniversary of the date of adoption of the 
     realignment program.
       ``(D) Revocation of certain benefit modifications.--Benefit 
     modifications described in paragraph (3) may be revoked, in 
     whole or in part, and retroactively or prospectively, when 
     contributions to the plan are increased, as specified in the 
     realignment program, including any amendments thereto. The 
     preceding sentence shall not apply unless the contribution 
     increases are to be effective not later than the fifth 
     anniversary of the first day of the first plan year that 
     begins after the adoption of the realignment program.
       ``(b) Notice.--
       ``(1) In general.--In any case in which it is certified 
     under section 438(a) that the projected funded ratio is less 
     than 120 percent, the plan sponsor shall, not later than 30 
     days after the date of the certification, provide 
     notification of the current and projected funded ratios to 
     the participants and beneficiaries, the bargaining parties, 
     the Secretary of Labor, and the Secretary. Such notice shall 
     include--
       ``(A) an explanation that contribution rate increases or 
     benefit reductions may be necessary,
       ``(B) a description of the types of benefits that might be 
     reduced, and
       ``(C) an estimate of the contribution increases and benefit 
     reductions that may be necessary to achieve a projected 
     funded ratio of 120 percent.
       ``(2) Notice of benefit modifications.--
       ``(A) In general.--No modifications may be made that reduce 
     the rate of future benefit accrual or that reduce core 
     benefits or adjustable benefits unless notice of such 
     reduction has been given at least 180 days before the general 
     effective date of such reduction for all participants and 
     beneficiaries to--
       ``(i) plan participants and beneficiaries,
       ``(ii) each employer who has an obligation to contribute to 
     the composite plan, and
       ``(iii) each employee organization which, for purposes of 
     collective bargaining, represents plan participants employed 
     by such employers.
       ``(B) Content of notice.--The notice under subparagraph (A) 
     shall contain--
       ``(i) sufficient information to enable participants and 
     beneficiaries to understand the effect of any reduction on 
     their benefits, including an illustration of any affected 
     benefit or subsidy, on an annual or monthly basis that a 
     participant or beneficiary would otherwise have been eligible 
     for as of the general effective date described in 
     subparagraph (A), and
       ``(ii) information as to the rights and remedies of plan 
     participants and beneficiaries as well as how to contact the 
     Department of the Treasury for further information and 
     assistance, where appropriate.
       ``(C) Form and manner.--Any notice under subparagraph (A)--
       ``(i) shall be provided in a form and manner prescribed in 
     regulations of the Secretary,
       ``(ii) shall be written in a manner so as to be understood 
     by the average plan participant.
       ``(3) Model notices.--The Secretary shall--
       ``(A) prescribe model notices that the plan sponsor of a 
     composite plan may use to satisfy the notice requirements 
     under this subsection, and
       ``(B) by regulation enumerate any details related to the 
     elements listed in paragraph (1) that any notice under this 
     subsection must include.
       ``(4) Delivery method.--Any notice under this part shall be 
     provided in writing and may be provided in electronic form to 
     the extent that the form is reasonably accessible to persons 
     to whom the notice is provided.

     ``SEC. 440. LIMITATION ON INCREASING BENEFITS.

       ``(a) Level of Current Funded Ratios.--Except as provided 
     in subsections (c), (d), and (e), no plan amendment 
     increasing benefits or establishing new benefits under a 
     composite plan may be adopted for a plan year unless--
       ``(1) the plan's current funded ratio is at least 110 
     percent (without regard to the benefit increase or new 
     benefits),
       ``(2) taking the benefit increase or new benefits into 
     account, the current funded ratio is at least 100 percent and 
     the projected funded ratio for the current plan year is at 
     least 120 percent,
       ``(3) in any case in which, after taking the benefit 
     increase or new benefits into account, the current funded 
     ratio is less than 140 percent or the projected funded ratio 
     is less than 140 percent, the benefit increase or new 
     benefits are projected by the plan actuary to increase the 
     present value of the plan's liabilities for the plan year by 
     not more than 3 percent, and
       ``(4) expected contributions for the current plan year are 
     at least 120 percent of normal cost for the plan year, 
     determined using the unit credit funding method and treating 
     the benefit increase or new benefits as in effect for the 
     entire plan year.
       ``(b) Additional Requirements Where Core Benefits 
     Reduced.--If a plan has been

[[Page S7628]]

     amended to reduce core benefits pursuant to a realignment 
     program under section 439(a)(2)(D), such plan may not be 
     subsequently amended to increase core benefits unless the 
     amendment--
       ``(1) increases the level of future benefit payments only, 
     and
       ``(2) provides for an equitable distribution of benefit 
     increases across the participant and beneficiary population, 
     taking into account the extent to which the benefits of 
     participants were previously reduced pursuant to such 
     realignment program.
       ``(c) Exception To Comply With Applicable Law.--Subsection 
     (a) shall not apply in connection with a plan amendment if 
     the amendment is required as a condition of qualification 
     under part I of subchapter D of chapter 1 or to comply with 
     other applicable law.
       ``(d) Exception Where Maximum Deductible Limit Applies.--
     Subsection (a) shall not apply in connection with a plan 
     amendment if and to the extent that contributions to the 
     composite plan would not be deductible for the plan year 
     under section 404(a)(1)(E) if the plan amendment is not 
     adopted. The Secretary of the Treasury shall issue 
     regulations to implement this paragraph.
       ``(e) Exception for Certain Benefit Modifications.--
     Subsection (a) shall not apply in connection with a plan 
     amendment under section 439(a)(5)(C), regarding conditional 
     benefit modifications.
       ``(f) Treatment of Plan Amendments.--For purposes of this 
     section--
       ``(1) if two or more plan amendments increasing benefits or 
     establishing new benefits are adopted in a plan year, such 
     amendments shall be treated as a single amendment adopted on 
     the last day of the plan year,
       ``(2) all benefit increases and new benefits adopted in a 
     single amendment are treated as a single benefit increase, 
     irrespective of whether the increases and new benefits take 
     effect in more than one plan year, and
       ``(3) increases in contributions or decreases in plan 
     liabilities which are scheduled to take effect in future plan 
     years may be taken into account in connection with a plan 
     amendment if they have been agreed to in writing or otherwise 
     formalized by the date the plan amendment is adopted.

     ``SEC. 440A. COMPOSITE PLAN RESTRICTIONS TO PRESERVE LEGACY 
                   PLAN FUNDING.

       ``(a) Treatment as a Legacy Plan.--
       ``(1) In general.--For purposes of this subchapter, a 
     defined benefit plan shall be treated as a legacy plan with 
     respect to the composite plan under which employees who were 
     eligible to accrue a benefit under the defined benefit plan 
     become eligible to accrue a benefit under such composite 
     plan.
       ``(2) Component plans.--In any case in which a defined 
     benefit plan is amended to add a composite plan component 
     pursuant to section 437(b), paragraph (1) shall be applied by 
     substituting `defined benefit component' for `defined benefit 
     plan' and `composite plan component' for `composite plan'.
       ``(3) Eligible to accrue a benefit.--For purposes of 
     paragraph (1), an employee is considered eligible to accrue a 
     benefit under a composite plan as of the first day in which 
     the employee completes an hour of service under a collective 
     bargaining agreement that provides for contributions to and 
     accruals under the composite plan in lieu of accruals under 
     the defined benefit plan.
       ``(4) Collective bargaining agreement.--As used in this 
     part, the term `collective bargaining agreement' includes any 
     agreement under which an employer has an obligation to 
     contribute to a plan.
       ``(5) Other terms.--Any term used in this part which is not 
     defined in this part and which is also used in section 432 
     shall have the same meaning provided such term in such 
     section.
       ``(b) Restrictions on Acceptance by Composite Plan of 
     Agreements and Contributions.--
       ``(1) In general.--The plan sponsor of a composite plan 
     shall not accept or recognize a collective bargaining 
     agreement (or any modification to such agreement), and no 
     contributions may be accepted and no benefits may be accrued 
     or otherwise earned under the agreement--
       ``(A) in any case in which the plan actuary of any defined 
     benefit plan that would be treated as a legacy plan with 
     respect to such composite plan has certified under section 
     432(b)(4) that such defined benefit plan is or will be in 
     endangered or critical status for the plan year in which such 
     agreement would take effect or for any of the succeeding 5 
     plan years, and
       ``(B) unless the agreement requires each employer who is a 
     party to such agreement, including employers whose employees 
     are not participants in the legacy plan, to provide 
     contributions to the legacy plan with respect to such 
     composite plan in a manner that satisfies the transition 
     contribution requirements of subsection (d).
       ``(2) Notice.--Not later than 30 days after a determination 
     by a plan sponsor of a composite plan that an agreement fails 
     to satisfy the requirements described in paragraph (1), the 
     plan sponsor shall provide notification of such failure and 
     the reasons for such determination to--
       ``(A) the parties to the agreement,
       ``(B) active participants of the composite plan who have 
     ceased to accrue or otherwise earn benefits with respect to 
     service with an employer pursuant to paragraph (1), and
       ``(C) the Secretary of Labor, the Secretary of the 
     Treasury, and the Pension Benefit Guaranty Corporation.
       ``(3) Limitation on retroactive effect.--This subsection 
     shall not apply to benefits accrued before the date on which 
     notice is provided under paragraph (2).
       ``(c) Restriction on Accrual of Benefits Under a Composite 
     Plan.--
       ``(1) In general.--In any case in which an employer, under 
     a collective bargaining agreement entered into after the date 
     of enactment of the Chris Allen Multiemployer Pension 
     Recapitalization and Reform Act of 2020, ceases to have an 
     obligation to contribute to a multiemployer defined benefit 
     plan, no employees employed by the employer may accrue or 
     otherwise earn benefits under any composite plan, with 
     respect to service with that employer, for a 60-month period 
     beginning on the date on which the employer entered into such 
     collective bargaining agreement.
       ``(2) Notice of cessation of obligation.--Within 30 days of 
     determining that an employer has ceased to have an obligation 
     to contribute to a legacy plan with respect to employees 
     employed by an employer that is or will be contributing to a 
     composite plan with respect to service of such employees, the 
     plan sponsor of the legacy plan shall notify the plan sponsor 
     of the composite plan of that cessation.
       ``(3) Notice of cessation of accruals.--Not later than 30 
     days after determining that an employer has ceased to have an 
     obligation to contribute to a legacy plan, the plan sponsor 
     of the composite plan shall notify the bargaining parties, 
     the active participants affected by the cessation of 
     accruals, the Secretary, the Secretary of Labor, and the 
     Pension Benefit Guaranty Corporation of the cessation of 
     accruals, the period during which such cessation is in 
     effect, and the reasons therefor.
       ``(4) Limitation on retroactive effect.--This subsection 
     shall not apply to benefits accrued before the date on which 
     notice is provided under paragraph (3).
       ``(d) Transition Contribution Requirements.--
       ``(1) In general.--A collective bargaining agreement 
     satisfies the transition contribution requirements of this 
     subsection if the agreement--
       ``(A) authorizes for payment of contributions to a legacy 
     plan at a rate, or multiple rates, as described in paragraph 
     (2)(B), equal to or greater than the transition contribution 
     rate established under paragraph (2), and
       ``(B) does not provide for--
       ``(i) a suspension of contributions to the legacy plan with 
     respect to any period of service, or
       ``(ii) any new direct or indirect exclusion of younger or 
     newly hired employees of the employer from being taken into 
     account in determining contributions owed to the legacy plan.
       ``(2) Transition contribution rate.--
       ``(A) In general.--The transition contribution rate for a 
     plan year is the contribution rate that, as certified by the 
     actuary of the legacy plan in accordance with the principles 
     in section 432(b)(4)(B), is reasonably expected to be 
     adequate--
       ``(i) to fund the normal cost for the plan year,
       ``(ii) to amortize the plan's unfunded liabilities in level 
     annual installments over 25 years, beginning with the plan 
     year in which the transition contribution rate is first 
     established, and
       ``(iii) to amortize any subsequent changes in the legacy 
     plan's unfunded liability due to experience gains or losses 
     (including investment gains or losses, gains or losses due to 
     contributions greater or less than the contributions made 
     under the prior transition contribution rate, and other 
     actuarial gains or losses), changes in actuarial assumptions, 
     changes to the legacy plan's benefits, or changes in funding 
     method over a period of 15 plan years beginning with the plan 
     year following the plan year in which such change in unfunded 
     liability is incurred, unless otherwise prescribed.
     The transition contribution rate for any plan year may not be 
     less than the transition contribution rate for the plan year 
     in which such rate is first established.
       ``(B) Multiple rates.--If different rates of contribution 
     are payable to the legacy plan by different employers or for 
     different classes of employees, the certification by the 
     actuary of the legacy plan shall specify a transition 
     contribution rate for each such employer or class of 
     employees.
       ``(C) Rate applicable to employer.--
       ``(i) In general.--Except as provided by clause (ii), the 
     transition contribution rate applicable to an employer for a 
     plan year is the rate in effect for the plan year of the 
     legacy plan that commences on or after 180 days before the 
     earlier of--

       ``(I) the effective date of the collective bargaining 
     agreement pursuant to which the employer contributes to the 
     legacy plan, or
       ``(II) 5 years after the last plan year for which the 
     transition contribution rate applicable to the employer was 
     established or updated.

       ``(ii) Exception.--The transition contribution rate 
     applicable to an employer for the first plan year beginning 
     on or after the commencement of the employer's obligation to 
     contribute to the composite plan is the rate in effect for 
     the plan year of the legacy plan that commences on or after 
     180 days before such first plan year.
       ``(D) Effect of legacy plan financial circumstances.--If 
     the plan actuary of the legacy plan has certified under 
     section 432 that the plan is in endangered or critical status

[[Page S7629]]

     for a plan year, the transition contribution rate for the 
     following plan year is the rate determined with respect to 
     the employer under the legacy plan's funding improvement or 
     rehabilitation plan under section 432, if greater than the 
     rate otherwise determined, but in no event shall the 
     transition contribution rate be greater than 75 percent of 
     the sum of the contribution rates applicable to the legacy 
     plan and the composite plan for the plan year. 
     Notwithstanding the preceding sentence, if the transition 
     contribution rate in the prior year is more than 75 percent 
     of the sum of the contribution rates applicable to the legacy 
     plan and the composite plan for the prior plan year, the 
     transition contribution rate applicable to the legacy plan 
     shall not be subject to the 75-percent limitation, but shall 
     be neither increased nor reduced as a percentage of the sum 
     of the contribution rates applicable to the legacy plan and 
     the composite plan for the plan year.
       ``(E) Other actuarial assumptions and methods.--Except as 
     provided in subparagraph (A), the determination of the 
     transition contribution rate for a plan year shall be based 
     on actuarial assumptions and methods consistent with the 
     minimum funding determinations made under section 431 (or, if 
     applicable, section 432) with respect to the legacy plan for 
     the plan year.
       ``(F) Adjustments in rate.--The plan sponsor of a legacy 
     plan from time to time may adjust the transition contribution 
     rate or rates applicable to an employer under this paragraph 
     by increasing some rates and decreasing others if the actuary 
     certifies that such adjusted rates in combination will 
     produce projected contribution income for the plan year 
     beginning on or after the date of certification that is not 
     less than would be produced by the transition contribution 
     rates in effect at the time of the certification.
       ``(G) Notice of transition contribution rate.--The plan 
     sponsor of a legacy plan shall provide notice to the parties 
     to collective bargaining agreements pursuant to which 
     contributions are made to the legacy plan of changes to the 
     transition contribution rate requirements at least 30 days 
     before the beginning of the plan year for which the rate is 
     effective.
       ``(H) Notice to composite plan sponsor.--Not later than 30 
     days after a determination by the plan sponsor of a legacy 
     plan that a collective bargaining agreement provides for a 
     rate of contributions that is below the transition 
     contribution rate applicable to one or more employers that 
     are parties to the collective bargaining agreement, the plan 
     sponsor of the legacy plan shall notify the plan sponsor of 
     any composite plan under which employees of such employer 
     would otherwise be eligible to accrue a benefit.
       ``(3) Correction procedures.--Pursuant to standards 
     prescribed by the Secretary of Labor, the plan sponsor of a 
     composite plan shall adopt rules and procedures that give the 
     parties to the collective bargaining agreement notice of the 
     failure of such agreement to satisfy the transition 
     contribution requirements of this subsection, and a 
     reasonable opportunity to correct such failure, not to exceed 
     180 days from the date of notice given under subsection 
     (b)(2).
       ``(4) Supplemental contributions.--A collective bargaining 
     agreement may provide for supplemental contributions to the 
     legacy plan for a plan year in excess of the transition 
     contribution rate determined under paragraph (2), regardless 
     of whether the legacy plan is in endangered or critical 
     status for such plan year.
       ``(e) Nonapplication of Composite Plan Restrictions.--
       ``(1) In general.--The provisions of subsections (a), (b), 
     and (c) shall not apply with respect to a collective 
     bargaining agreement, to the extent the agreement, or a 
     predecessor agreement, provides or provided for contributions 
     to a defined benefit plan that is a legacy plan, as of the 
     first day of the first plan year following a plan year for 
     which the plan actuary certifies that the plan is fully 
     funded, has been fully funded for at least three out of the 
     immediately preceding 5 plan years, and is projected to 
     remain fully funded for at least the following 4 plan years.
       ``(2) Determination of fully funded.--A plan is fully 
     funded for purposes of paragraph (1) if, as of the valuation 
     date of the plan for a plan year, the value of the plan's 
     assets equals or exceeds the present value of the plan's 
     liabilities, determined in accordance with the rules 
     prescribed by the Pension Benefit Guaranty Corporation under 
     sections 4219(c)(1)(D) and 4281 of Employee Retirement Income 
     and Security Act for multiemployer plans terminating by mass 
     withdrawal, as in effect for the date of the determination, 
     except the plan's reasonable assumption regarding the 
     starting date of benefits may be used.
       ``(3) Other applicable rules.--Except as provided in 
     paragraph (2), actuarial determinations and projections under 
     this section shall be based on the rules in section 438(b).

     ``SEC. 440B. MERGERS AND ASSET TRANSFERS OF COMPOSITE PLANS.

       ``(a) In General.--Assets and liabilities of a composite 
     plan may only be merged with, or transferred to, another plan 
     if--
       ``(1) the other plan is a composite plan,
       ``(2) the plan or plans resulting from the merger or 
     transfer is a composite plan,
       ``(3) no participant's accrued benefit or adjustable 
     benefit is lower immediately after the transaction than it 
     was immediately before the transaction, and
       ``(4) the value of the assets transferred in the case of a 
     transfer reasonably reflects the value of the amounts 
     contributed with respect to the participants whose benefits 
     are being transferred, adjusted for allocable distributions, 
     investment gains and losses, and administrative expenses.
     A plan which is not a composite plan may not merge with or 
     transfer assets and liabilities to a composite plan.
       ``(b) Legacy Plan.--
       ``(1) In general.--After a merger or transfer involving a 
     composite plan, the legacy plan with respect to an employer 
     that is obligated to contribute to the resulting composite 
     plan is the legacy plan that applied to that employer 
     immediately before the merger or transfer.
       ``(2) Multiple legacy plans.--If an employer is obligated 
     to contribute to more than one legacy plan with respect to 
     employees eligible to accrue benefits under more than one 
     composite plan and there is a merger or transfer of such 
     legacy plans, the transition contribution rate applicable to 
     the legacy plan resulting from the merger or transfer with 
     respect to that employer shall be determined in accordance 
     with the provisions of section 440A(d)(2)(B).''.
       (2) Clerical amendment.--The table of parts for subchapter 
     D of chapter 1 of the Internal Revenue Code of 1986 is 
     amended by adding at the end the following new item:

             ``Part IV--Composite Plans and Legacy Plans''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after the date of the 
     enactment of this Act.

     SEC. 502. APPLICATION OF CERTAIN REQUIREMENTS TO COMPOSITE 
                   PLANS.

       (a) Amendments to the Employee Retirement Income Security 
     Act of 1974.--
       (1) Treatment for purposes of funding notices.--Section 
     101(f) of the Employee Retirement Income Security Act of 1974 
     (29 U.S.C. 1021(f)), as amended by this Act, is further 
     amended--
       (A) in paragraph (1) by striking ``title IV applies'' and 
     inserting ``title IV applies or which is a composite plan''; 
     and
       (B) by adding at the end the following:
       ``(5) Application to composite plans.--The provisions of 
     this subsection shall apply to a composite plan only to the 
     extent prescribed by the Secretary in regulations that take 
     into account the differences between a composite plan and a 
     defined benefit plan that is a multiemployer plan.''.
       (2) Treatment for purposes of annual report.--Section 103 
     of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1023) is amended--
       (A) in subsection (d) by adding at the end the following 
     sentence: ``The provisions of this subsection shall apply to 
     a composite plan only to the extent prescribed by the 
     Secretary in regulations that take into account the 
     differences between a composite plan and a defined benefit 
     plan that is a multiemployer plan.'';
       (B) in subsection (f) by adding at the end the following:
       ``(3) Additional information for composite plans.--With 
     respect to any composite plan--
       ``(A) the provisions of paragraph (1)(A) shall apply by 
     substituting `current funded ratio and projected funded ratio 
     (as such terms are defined in section 802(a)(2))' for `funded 
     percentage' each place it appears; and
       ``(B) the provisions of paragraph (2) shall apply only to 
     the extent prescribed by the Secretary in regulations that 
     take into account the differences between a composite plan 
     and a defined benefit plan that is a multiemployer plan.''; 
     and
       (C) by adding at the end the following:
       ``(h) Composite Plans.--A multiemployer plan that 
     incorporates the features of a composite plan as provided in 
     section 801(b) shall be treated as a single plan for purposes 
     of the report required by this section, except that separate 
     financial statements and actuarial statements shall be 
     provided under paragraphs (3) and (4) of subsection (a) for 
     the defined benefit plan component and for the composite plan 
     component of the multiemployer plan.''.
       (3) Treatment for purposes of pension benefit statements.--
     Section 105(a) of the Employee Retirement Income Security Act 
     of 1974 (29 U.S.C. 1025(a)) is amended by adding at the end 
     the following:
       ``(4) Composite plans.--For purposes of this subsection, a 
     composite plan shall be treated as a defined benefit plan to 
     the extent prescribed by the Secretary in regulations that 
     take into account the differences between a composite plan 
     and a defined benefit plan that is a multiemployer plan.''.
       (b) Amendments to the Internal Revenue Code of 1986.--
     Section 6058 of the Internal Revenue Code of 1986 is amended 
     by redesignating subsection (f) as subsection (g) and by 
     inserting after subsection (e) the following:
       ``(f) Composite Plans.--A multiemployer plan that 
     incorporates the features of a composite plan as provided in 
     section 437(b) shall be treated as a single plan for purposes 
     of the return required by this section, except that separate 
     financial statements shall be provided for the defined 
     benefit plan component and for the composite plan component 
     of the multiemployer plan.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after the date of the 
     enactment of this Act.

[[Page S7630]]

  


     SEC. 503. TREATMENT OF COMPOSITE PLANS UNDER TITLE IV.

       (a) Definition.--Section 4001(a) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1301(a)) is amended by 
     striking the period at the end of paragraph (21) and 
     inserting a semicolon and by adding at the end the following:
       ``(22) Composite plan.--The term `composite plan' has the 
     meaning set forth in section 801.''.
       (b) Composite Plans Disregarded for Calculating Premiums.--
     Section 4006(a) of the Employee Retirement Income Security 
     Act of 1974 (29 U.S.C. 1306(a)) is amended by adding at the 
     end the following:
       ``(9) The composite plan component of a multiemployer plan 
     shall be disregarded in determining the premiums due under 
     this section from the multiemployer plan.''.
       (c) Composite Plans Not Covered.--Section 4021(b)(1) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1321(b)(1)) is amended by striking ``Act'' and inserting 
     ``Act, or a composite plan, as defined in paragraph (43) of 
     section 3 of this Act''.
       (d) No Withdrawal Liability.--Section 4201 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1381) is 
     amended by adding at the end the following:
       ``(c) Contributions by an employer to the composite plan 
     component of a multiemployer plan shall not be taken into 
     account for any purpose under this title.''.
       (e) No Withdrawal Liability for Certain Plans.--Section 
     4201 of the Employee Retirement Income Security Act of 1974 
     (29 U.S.C. 1381) is further amended by adding at the end the 
     following:
       ``(d) Contributions by an employer to a multiemployer plan 
     described in the except clause of section 3(35) of this Act 
     pursuant to a collective bargaining agreement that 
     specifically designates that such contributions shall be 
     allocated to the separate defined contribution accounts of 
     participants under the plan shall not be taken into account 
     with respect to the defined benefit portion of the plan for 
     any purpose under this title (including the determination of 
     the employer's highest contribution rate under section 4219), 
     even if, under the terms of the plan, participants have the 
     option to transfer assets in their separate defined 
     contribution accounts to the defined benefit portion of the 
     plan in return for service credit under the defined benefit 
     portion, at rates established by the plan sponsor.
       ``(e) A legacy plan created under section 805 shall be 
     deemed to have no unfunded vested benefits for purposes of 
     this part, for each plan year following a period of 5 
     consecutive plan years for which--
       ``(1) the plan was fully funded within the meaning of 
     section 805 for at least 3 of the plan years during that 
     period, ending with a plan year for which the plan is fully 
     funded;
       ``(2) the plan had no unfunded vested benefits for at least 
     3 of the plan years during that period, ending with a plan 
     year for which the plan is fully funded; and
       ``(3) the plan is projected to be fully funded and to have 
     no unfunded vested benefits for the following four plan 
     years.''.
       (f) No Withdrawal Liability for Employers Contributing to 
     Certain Fully Funded Legacy Plans.--Section 4211 of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1382) is amended by adding at the end the following:
       ``(g) Legacy Plans.--No amount of unfunded vested benefits 
     shall be allocated to an employer that has an obligation to 
     contribute to a legacy plan described in subsection (e) of 
     section 4201 for each plan year for which such subsection 
     applies.''.
       (g) No Obligation To Contribute.--Section 4212 of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1392) is amended by adding at the end the following:
       ``(d) No Obligation To Contribute.--An employer shall not 
     be treated as having an obligation to contribute to a 
     multiemployer defined benefit plan within the meaning of 
     subsection (a) solely because--
       ``(1) in the case of a multiemployer plan that includes a 
     composite plan component, the employer has an obligation to 
     contribute to the composite plan component of the plan;
       ``(2) the employer has an obligation to contribute to a 
     composite plan that is maintained pursuant to one or more 
     collective bargaining agreements under which the 
     multiemployer defined benefit plan is or previously was 
     maintained; or
       ``(3) the employer contributes or has contributed under 
     section 805(d) to a legacy plan associated with a composite 
     plan pursuant to a collective bargaining agreement but 
     employees of that employer were not eligible to accrue 
     benefits under the legacy plan with respect to service with 
     that employer.''.
       (h) No Inference.--Nothing in the amendment made by 
     subsection (e) shall be construed to create an inference with 
     respect to the treatment under title IV of the Employee 
     Retirement Income Security Act of 1974, as in effect before 
     such amendment, of contributions by an employer to a 
     multiemployer plan described in the except clause of section 
     3(35) of such Act that are made before the effective date of 
     subsection (e) specified in subsection (h)(2).
       (i) Effective Date.--
       (1) In general.--Except as provided in subparagraph (2), 
     the amendments made by this section shall apply to plan years 
     beginning after the date of the enactment of this Act.
       (2) Special rule for section 414(k) multiemployer plans.--
     The amendment made by subsection (e) shall apply only to 
     required contributions payable for plan years beginning after 
     the date of the enactment of this Act.

     SEC. 504. CONFORMING CHANGES.

       (a) Definitions.--
       (1) Amendment to employee retirement income security act of 
     1974.--Section 3 of the Employee Retirement Income Security 
     Act of 1974 (29 U.S.C. 1002) is amended--
       (A) in paragraph (35), by inserting ``or a composite plan'' 
     after ``other than an individual account plan''; and
       (B) by adding at the end the following:
       ``(43) The term `composite plan' has the meaning given the 
     term in section 801(a).''.
       (2) Amendment to internal revenue code of 1986.--Section 
     414(j) of the Internal Revenue Code of 1986 is amended by 
     inserting ``, other than a composite plan (as defined in 
     section 437(a)),'' after ``any plan''.
       (b) Special Funding Rule for Certain Legacy Plans.--
       (1) Amendment to employee retirement income security act of 
     1974.--Section 304(b) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1084(b)), as amended by this 
     Act, is amended by adding at the end the following:
       ``(10) Special funding rule for certain legacy plans.--In 
     the case of a multiemployer defined benefit plan that has 
     adopted an amendment under section 801(b), in accordance with 
     which no further benefits shall accrue under the 
     multiemployer defined benefit plan, the plan sponsor may 
     combine the outstanding balance of all charge and credit 
     bases and amortize that combined base in level annual 
     installments (until fully amortized) over a period of 25 plan 
     years beginning with the plan year following the date all 
     benefit accruals ceased, but only if the plan is not in 
     endangered or critical status under section 305.''.
       (2) Amendment to internal revenue code of 1986.--Section 
     431(b) of the Internal Revenue Code of 1986, as amended by 
     this Act, is amended by adding at the end the following:
       ``(10) Special funding rule for certain legacy plans.--In 
     the case of a multiemployer defined benefit plan that has 
     adopted an amendment under section 437(b), in accordance with 
     which no further benefits shall accrue under the 
     multiemployer defined benefit plan, the plan sponsor may 
     combine the outstanding balance of all charge and credit 
     bases and amortize that combined base in level annual 
     installments (until fully amortized) over a period of 25 plan 
     years beginning with the plan year following the date on 
     which all benefit accruals ceased, but only if the plan is 
     not in endangered or critical status under section 432.''.
       (c) Benefits After Merger, Consolidation, or Transfer of 
     Assets.--
       (1) Amendment to employee retirement income security act of 
     1974.--Section 208 of the Employee Retirement Income Security 
     Act of 1974 (29 U.S.C. 1058) is amended--
       (A) by striking so much of the first sentence as precedes 
     ``may not merge'' and inserting the following:
       ``(1) In general.--Except as provided in paragraph (2), a 
     pension plan may not merge, and''; and
       (B) by striking the second sentence and adding at the end 
     the following:
       ``(2) Special requirements for multiemployer plans.--
     Paragraph (1) shall not apply to any transaction to the 
     extent that participants either before or after the 
     transaction are covered under a multiemployer plan to which 
     title IV of this Act applies or a composite plan.''.
       (2) Amendments to internal revenue code of 1986.--
       (A) Qualification requirement.--Section 401(a)(12) of the 
     Internal Revenue Code of 1986 is amended--
       (i) by striking ``(12) A trust'' and inserting the 
     following:
       ``(12) Benefits after merger, consolidation, or transfer of 
     assets.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     a trust'';
       (ii) by striking the second sentence; and
       (iii) by adding at the end the following:
       ``(B) Special requirements for multiemployer plans.--
     Subparagraph (A) shall not apply to any multiemployer plan 
     with respect to any transaction to the extent that 
     participants either before or after the transaction are 
     covered under a multiemployer plan to which title IV of the 
     Employee Retirement Income Security Act of 1974 applies or a 
     composite plan.''.
       (B) Additional qualification requirement.--Paragraph (1) of 
     section 414(l) of such Code is amended--
       (i) by striking ``(1) In general'' and all that follows 
     through ``shall not constitute'' and inserting the following:
       ``(1) Benefit protections: merger, consolidation, 
     transfer.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     a trust which forms a part of a plan shall not constitute''; 
     and
       (ii) by striking the second sentence; and
       (iii) by adding at the end the following:
       ``(B) Special requirements for multiemployer plans.--
     Subparagraph (A) does not apply to any multiemployer plan 
     with respect to any transaction to the extent that 
     participants either before or after the transaction are 
     covered under a multiemployer plan to which title IV of the 
     Employee Retirement Income Security Act of 1974 applies or a 
     composite plan.''.
       (d) Requirements for Status as a Qualified Plan.--
       (1) Requirement that actuarial assumptions be specified.--
     Section 401(a)(25) of the Internal Revenue Code of 1986 is 
     amended by inserting ``(in the case of a composite plan,

[[Page S7631]]

     benefits objectively calculated pursuant to a formula)'' 
     after ``definitely determinable benefits''.
       (2) Missing participants in terminating composite plan.--
     Section 401(a)(34) of the Internal Revenue Code of 1986 is 
     amended by striking ``, a trust'' and inserting ``or a 
     composite plan, a trust''.
       (e) Deduction for Contributions to a Qualified Plan.--
     Section 404(a)(1) of the Internal Revenue Code of 1986 is 
     amended by redesignating subparagraph (E) as subparagraph (F) 
     and by inserting after subparagraph (D) the following:
       ``(E) Composite plans.--
       ``(i) In general.--In the case of a composite plan, 
     subparagraph (D) shall not apply and the maximum amount 
     deductible for a plan year shall be the excess (if any) of--

       ``(I) 140 percent of the greater of--

       ``(aa) the current liability of the plan determined in 
     accordance with the principles of section 431(c)(6)(D), or
       ``(bb) the present value of plan liabilities as determined 
     under section 438, over

       ``(II) the fair market value of the plan's assets, 
     projected to the end of the plan year.

       ``(ii) Special rules for predecessor multiemployer plan to 
     composite plan.--

       ``(I) In general.--Except as provided in subclause (II), if 
     an employer contributes to a composite plan with respect to 
     its employees, contributions by that employer to a legacy 
     plan with respect to some or all of the same group of 
     employees shall be deductible under sections 162 and this 
     section, subject to the limits in subparagraph (D).
       ``(II) Transition contribution.--The full amount of a 
     contribution to satisfy the transition contribution 
     requirement (as defined in section 440A(d)) and allocated to 
     the legacy defined benefit plan for the plan year shall be 
     deductible for the employer's taxable year ending with or 
     within the plan year.''.

       (f) Minimum Vesting Standards.--
       (1) Years of service under composite plans.--
       (A) Employee retirement income security act of 1974.--
     Section 203 of the Employee Retirement Income Security Act of 
     1974 (29 U.S.C. 1053) is amended by inserting after 
     subsection (f) the following:
       ``(g) Special Rules for Computing Years of Service Under 
     Composite Plans.--
       ``(1) In general.--In determining a qualified employee's 
     years of service under a composite plan for purposes of this 
     section, the employee's years of service under a legacy plan 
     shall be treated as years of service earned under the 
     composite plan. For purposes of such determination, a 
     composite plan shall not be treated as a defined benefit plan 
     pursuant to section 801(d).
       ``(2) Qualified employee.--For purposes of this subsection, 
     an employee is a qualified employee if the employee first 
     completes an hour of service under the composite plan 
     (determined without regard to the provisions of this 
     subsection) within the 12-month period immediately preceding 
     or the 24-month period immediately following the date the 
     employee ceased to accrue benefits under the legacy plan.
       ``(3) Certification of years of service.--For purposes of 
     paragraph (1), the plan sponsor of the composite plan shall 
     rely on a written certification by the plan sponsor of the 
     legacy plan of the years of service the qualified employee 
     completed under the defined benefit plan as of the date the 
     employee satisfies the requirements of paragraph (2), 
     disregarding any years of service that had been forfeited 
     under the rules of the defined benefit plan before that date 
     unless contrary to service records provided by the 
     participant. In the case of a conflict, the plan sponsor 
     shall evaluate the evidence and make a reasonable factual 
     determination.
       ``(h) Special Rules for Computing Years of Service Under 
     Legacy Plans.--
       ``(1) In general.--In determining a qualified employee's 
     years of service under a legacy plan for purposes of this 
     section, and in addition to any service under applicable 
     regulations, the employee's years of service under a 
     composite plan shall be treated as years of service earned 
     under the legacy plan. For purposes of such determination, a 
     composite plan shall not be treated as a defined benefit plan 
     pursuant to section 801(d).
       ``(2) Qualified employee.--For purposes of this subsection, 
     an employee is a qualified employee if the employee first 
     completes an hour of service under the composite plan 
     (determined without regard to the provisions of this 
     subsection) within the 12-month period immediately preceding 
     or the 24-month period immediately following the date the 
     employee ceased to accrue benefits under the legacy plan.
       ``(3) Certification of years of service.--For purposes of 
     paragraph (1), the plan sponsor of the legacy plan shall rely 
     on a written certification by the plan sponsor of the 
     composite plan of the years of service the qualified employee 
     completed under the composite plan after the employee 
     satisfies the requirements of paragraph (2), disregarding any 
     years of service that has been forfeited under the rules of 
     the composite plan unless contrary to service records 
     provided by the participant. In the case of a conflict, the 
     plan sponsor shall evaluate the evidence and make a 
     reasonable factual determination.''.
       (B) Internal revenue code of 1986.--Section 411(a) of the 
     Internal Revenue Code of 1986 is amended by adding at the end 
     the following:
       ``(14) Special rules for determining years of service under 
     composite plans.--
       ``(A) In general.--In determining a qualified employee's 
     years of service under a composite plan for purposes of this 
     subsection, the employee's years of service under a legacy 
     plan shall be treated as years of service earned under the 
     composite plan. For purposes of such determination, a 
     composite plan shall not be treated as a defined benefit plan 
     pursuant to section 437(d).
       ``(B) Qualified employee.--For purposes of this paragraph, 
     an employee is a qualified employee if the employee first 
     completes an hour of service under the composite plan 
     (determined without regard to the provisions of this 
     paragraph) within the 12-month period immediately preceding 
     or the 24-month period immediately following the date the 
     employee ceased to accrue benefits under the legacy plan.
       ``(C) Certification of years of service.--For purposes of 
     subparagraph (A), the plan sponsor of the composite plan 
     shall rely on a written certification by the plan sponsor of 
     the legacy plan of the years of service the qualified 
     employee completed under the legacy plan as of the date the 
     employee satisfies the requirements of subparagraph (B), 
     disregarding any years of service that had been forfeited 
     under the rules of the defined benefit plan before that date 
     unless contrary to service records provided by the 
     participant. In the case of a conflict, the plan sponsor 
     shall evaluate the evidence and make a reasonable factual 
     determination.
       ``(15) Special rules for computing years of service under 
     legacy plans.--
       ``(A) In general.--In determining a qualified employee's 
     years of service under a legacy plan for purposes of this 
     section, and in addition to any service under applicable 
     regulations, the employee's years of service under a 
     composite plan shall be treated as years of service earned 
     under the legacy plan. For purposes of such determination, a 
     composite plan shall not be treated as a defined benefit plan 
     pursuant to section 437(d).
       ``(B) Qualified employee.--For purposes of this paragraph, 
     an employee is a qualified employee if the employee first 
     completes an hour of service under the composite plan 
     (determined without regard to the provisions of this 
     paragraph) within the 12-month period immediately preceding 
     or the 24-month period immediately following the date the 
     employee ceased to accrue benefits under the legacy plan.
       ``(C) Certification of years of service.--For purposes of 
     subparagraph (A), the plan sponsor of the legacy plan shall 
     rely on a written certification by the plan sponsor of the 
     composite plan of the years of service the qualified employee 
     completed under the composite plan after the employee 
     satisfies the requirements of subparagraph (B), disregarding 
     any years of service that has been forfeited under the rules 
     of the composite plan unless contrary to service records 
     provided by the participant. In the case of a conflict, the 
     plan sponsor shall evaluate the evidence and make a 
     reasonable factual determination.''.
       (2) Reduction of benefits.--
       (A) Employee retirement income security act of 1974.--
     Section 203(a)(3)(E)(ii) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1053(a)(3)(E)(ii)) is 
     amended--
       (i) in subclause (I) by striking ``4244A'' and inserting 
     ``305(f), 803,''; and
       (ii) in subclause (II) by striking ``4245'' and inserting 
     ``305(f), 4245,''.
       (B) Internal revenue code of 1986.--Section 411(a)(3)(F) of 
     the Internal Revenue Code of 1986 is amended--
       (i) in clause (i) by striking ``section 418D or under 
     section 4281 of the Employee Retirement Income Security Act 
     of 1974'' and inserting ``section 432(f) or 439 or under 
     section 4281 of the Employee Retirement Income Security Act 
     of 1974''; and
       (ii) in clause (ii) by inserting ``or 432(f)'' after 
     ``section 418E''.
       (3) Accrued benefit requirements.--
       (A) Employee retirement income security act of 1974.--
     Section 204(b)(1)(B)(i) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1054(b)(1)(B)(i)) is amended 
     by inserting ``, including an amendment reducing or 
     suspending benefits under section 305(f), 803, 4245 or 
     4281,'' after ``any amendment to the plan''.
       (B) Internal revenue code of 1986.--Section 411(b)(1)(B)(i) 
     of the Internal Revenue Code of 1986 is amended by inserting 
     ``, including an amendment reducing or suspending benefits 
     under section 418E, 432(f) or 439, or under section 4281 of 
     the Employee Retirement Income Security Act of 1974,'' after 
     ``any amendment to the plan''.
       (4) Additional accrued benefit requirements.--
       (A) Employee retirement income security act of 1974.--
     Section 204(b)(1)(H)(v) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1053(b)(1)(H)(v)) is amended 
     by inserting before the period at the end the following: ``, 
     or benefits are reduced or suspended under section 305(f), 
     803, 4245, or 4281''.
       (B) Internal revenue code of 1986.--Section 
     411(b)(1)(H)(iv) of the Internal Revenue Code of 1986 is 
     amended--
       (i) in the heading by striking ``benefit'' and inserting 
     ``benefit and the suspension and reduction of certain 
     benefits''; and
       (ii) in the text by inserting before the period at the end 
     the following: ``, or benefits are reduced or suspended under 
     section 418E, 432(f), or 439, or under section 4281 of the 
     Employee Retirement Income Security Act of 1974''.

[[Page S7632]]

       (5) Accrued benefit not to be decreased by amendment.--
       (A) Employee retirement income security act of 1974.--
     Section 204(g)(1) of the Employee Retirement Income Security 
     Act of 1974 (29 U.S.C. 1053(g)(1)) is amended by inserting 
     after ``302(d)(2)'' the following: ``, 305(f), 803, 4245,''.
       (B) Internal revenue code of 1986.--Section 411(d)(6)(A) of 
     the Internal Revenue Code of 1986 is amended by inserting 
     after ``412(d)(2),'' the following: ``418E, 432(f), or 
     439,''.
       (g) Certain Funding Rules Not Applicable.--
       (1) Employee retirement income security act of 1974.--
     Section 305 of the Employee Retirement Income Security Act of 
     1974 (29 U.S.C. 1085), as amended by section 212(a) and as in 
     effect before the amendments made by section 212 other than 
     subsection (a) thereof, is further amended by adding at the 
     end the following:
       ``(l) Legacy Plans.--This section and sections 302 and 304 
     shall not apply to an employer that has an obligation to 
     contribute to a plan that is a legacy plan within the meaning 
     of section 805(a) solely because the employer has an 
     obligation to contribute to a composite plan described in 
     section 801 that is associated with that legacy plan.''.
       (2) Internal revenue code of 1986.--Section 432 of the 
     Internal Revenue Code of 1986, as amended by section 211(a) 
     and as in effect before the amendments made by section 211 
     other than subsection (a) thereof, is further amended by 
     adding at the end the following:
       ``(l) Legacy Plans.--This section and sections 412 and 431 
     shall not apply to an employer that has an obligation to 
     contribute to a plan that is a legacy plan within the meaning 
     of section 440A(a) solely because the employer has an 
     obligation to contribute to a composite plan described in 
     section 437 that is associated with that legacy plan.''.
       (h) Termination of Composite Plan.--Section 403(d) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1103(d) is amended--
       (1) in paragraph (1), by striking ``regulations of the 
     Secretary.'' and inserting ``regulations of the Secretary, or 
     as provided in paragraph (3).''; and
       (2) by adding at the end the following:
       ``(3) Section 4044(a) of this Act shall be applied in the 
     case of the termination of a composite plan by--
       ``(A) limiting the benefits subject to paragraph (3) 
     thereof to benefits as defined in section 802(b)(3)(B); and
       ``(B) including in the benefits subject to paragraph (4) 
     all other benefits (if any) of individuals under the plan 
     that would be guaranteed under section 4022A if the plan were 
     subject to title IV.''.
       (i) Good Faith Compliance Prior to Guidance.--Where the 
     implementation of any provision of law added or amended by 
     this Act is subject to issuance of regulations by the 
     Secretary of Labor, the Secretary of the Treasury, or the 
     Pension Benefit Guaranty Corporation, a multiemployer plan 
     shall not be treated as failing to meet the requirements of 
     any such provision prior to the issuance of final regulations 
     or other guidance to carry out such provision if such plan is 
     operated in accordance with a reasonable, good faith 
     interpretation of such provision.

     SEC. 505. EFFECTIVE DATE.

       Unless otherwise specified, the amendments made by this 
     title shall apply to plan years beginning after the date of 
     the enactment of this title.

                     TITLE VI--FINANCIAL PROVISIONS

     SEC. 601. ADDITIONAL PREMIUMS.

       (a) Increase in Flat Dollar Premium Beginning in 2021.--
     Section 4006(a)(3) of the Employee Retirement Income Security 
     Act of 1974 (29 U.S.C. 1306(a)(3)) is amended--
       (1) in subparagraph (A)--
       (A) in clause (vi)--
       (i) by inserting ``and before January 1, 2021,'' after 
     ``2014,''; and
       (ii) by striking ``or'' at the end;
       (B) by moving the margins of clause (vii) 2 ems to the 
     left;
       (C) by redesignating clause (vii) as clause (ix); and
       (D) by inserting after clause (vi) the following:
       ``(vii) in the case of a multiemployer plan, for plan years 
     beginning in calendar year 2021, for each individual who is a 
     participant in such plan during the plan year, the dollar 
     amount in effect under clause (i) for plan years beginning in 
     2021,''.
       (b) Flat and Variable Rate Premium for Years After 2021.--
     Section 4006(a)(3)) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1306(a)(3)), as amended by 
     subsection (a), is further amended--
       (1) by inserting after clause (vii) of subparagraph (A) the 
     following:
       ``(viii) in the case of a multiemployer plan, for any plan 
     year beginning after December 31, 2021, an amount for each 
     individual who is a participant in such plan during the plan 
     year equal to the sum of--
       ``(I) the premium rate applicable under clause (i)(VIII), 
     plus
       ``(II) the additional premium (if any) determined under 
     subparagraph (N) for the plan year, or''; and
       (2) by adding at the end the following:
       ``(N)(i) The additional premium determined under this 
     subparagraph with respect to any multiemployer plan for any 
     plan year shall be an amount equal to the least of--
       ``(I) the amount determined under clause (ii) for the plan 
     year divided by the number of participants in such plan as of 
     the close of the preceding plan year;
       ``(II) 10 percent of the historic base contributions 
     divided by the number of participants in such plan as of the 
     close of the preceding plan year; or
       ``(III) $250.
       ``(ii) The amount determined under this clause for any plan 
     year shall be an amount equal to $10 for each $1,000 (or 
     fraction thereof) of the multiemployer unfunded vested 
     benefits under the plan as of the close of the preceding plan 
     year. For purposes of this clause, the term `multiemployer 
     unfunded vested benefits' means, for a plan year, the excess 
     (if any) of--
       ``(I) the current liability of the plan as determined under 
     section 304(c)(6)(D) by taking into account only vested 
     benefits, over
       ``(II) the fair market value (as determined under section 
     304(c)(6)(A)(ii)(I)) of the plan assets for the plan year 
     which are held by the plan as of the valuation date.
       ``(iii) For purposes of clause (i)(II), the term `historic 
     base contributions' means the average amount of the 
     contributions, excluding any payments of withdrawal 
     liability, to the plan required to be reported by the plan on 
     Schedule MB of the 3 most recent Forms 5500 required to be 
     filed before the date of enactment of this subparagraph.
       ``(iv) For each plan year beginning after December 31, 
     2022, there shall be substituted for the dollar amount of 
     historic base contributions under clause (i)(II) and the 
     dollar amount specified in clause (i)(III) an amount equal to 
     the greater of--
       ``(I) the product derived by multiplying such dollar amount 
     for plan years beginning in that calendar year by the ratio 
     of--
       ``(aa) the national average wage index (as defined in 
     section 209(k)(1) of the Social Security Act) for the first 
     of the 2 calendar years preceding the calendar year in which 
     such plan year begins, to
       ``(bb) the national average wage index (as so defined) for 
     2020, or
       ``(II) such dollar amount in effect for plan years 
     beginning in the preceding calendar year.
      If any amount determined under this clause is not a multiple 
     of $1, such product shall be rounded to the nearest multiple 
     of $1.''.
       (c) Additional Premiums.--Section 4006(a) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1306(a)), 
     as amended by this Act, is further amended by adding at the 
     end the following:
       ``(10) Additional premiums payable by participants and 
     beneficiaries.--
       ``(A) In general.--In addition to the amounts payable under 
     paragraph (3), for plan years beginning after December 31, 
     2021, with respect to multiemployer plans, premiums shall be 
     payable to the corporation with respect to participants and 
     beneficiaries who are in pay status in accordance with this 
     paragraph.
       ``(B) Amounts payable.--Subject to subparagraphs (C), (D), 
     and (E), the monthly amount payable by each participant or 
     beneficiary who is in pay status is--
       ``(i) an amount equal to 3 percent of the participant's or 
     beneficiary's aggregate monthly benefit, in the case of a 
     plan in endangered status, as described in section 305(b)(2);
       ``(ii) an amount equal to 5 percent of the participant's or 
     beneficiary's aggregate monthly benefit, in the case of a 
     plan in critical status, as described in section 305(b)(3);
       ``(iii) an amount equal to 7 percent of the participant's 
     or beneficiary's aggregate monthly benefit, in the case of a 
     plan in critical and declining status (as described in 
     section 305(b)(7)), a plan that became an insolvent plan 
     after the date of enactment of this paragraph, or a plan that 
     has been terminated under section 4041A or 4042 but is not 
     insolvent, unless that plan is (or was) an original or 
     successor plan pursuant to a special partition order under 
     section 4233A; or
       ``(iv) notwithstanding clauses (i), (ii), or (iii), an 
     amount equal to 10 percent of the participant's or 
     beneficiary's aggregate monthly benefit, in the case of a 
     plan which is (or was) an original or successor plan pursuant 
     to a special partition order under section 4233A, regardless 
     of the status of the original or successor plan.
       ``(C) Coordination with suspension of benefits.--In the 
     case of any participant or beneficiary whose benefits are 
     suspended under section 305(f)(9), the percentage of benefits 
     payable under the applicable clause of subparagraph (B) with 
     respect to the participant or beneficiary shall be reduced 
     (but not below zero) by the percentage of benefits which were 
     so suspended.
       ``(D) Treatment of benefits based on disability.--No 
     benefits--
       ``(i) based on disability (as defined by the plan), or
       ``(ii) of a participant or beneficiary who is entitled to a 
     benefit under title II of the Social Security Act on the 
     basis of a disability (as defined in section 223(d)(2) of 
     such Act),
     shall be included in the calculation of the participant's or 
     beneficiary's aggregate monthly benefit for purposes of 
     determining the payment due under subparagraph (B).
       ``(E) Phaseout of premium for those aged 75 and older.--
       ``(i) In general.--In the case of a participant or 
     beneficiary who has attained or will attain at least 75 years 
     of age in a plan year, the monthly amount payable by such 
     participant or beneficiary for months during such plan year 
     under this paragraph (determined without regard to this 
     subparagraph) shall be reduced by the applicable percentage 
     of such amount.

[[Page S7633]]

       ``(ii) Applicable percentage.-- For purposes of clause (i), 
     the applicable percentage for any month shall be determined 
     in accordance with the following table:
The applicable percentage is:ll attain during the plan year, age:
  75.........................................................20 percent
  76.........................................................40 percent
  77.........................................................60 percent
  78.........................................................80 percent
  79 or older.............................................. 100 percent

       ``(F) Methods of collection.--The premiums payable under 
     subparagraph (B) shall be collected by the plan from 
     participants who are receiving benefits under the plan by 
     deducting the amount of the premium from the benefits as and 
     when paid, and holding such amounts in a separate account to 
     be remitted to the corporation annually, as prescribed by 
     regulations of the corporation. Amounts held in a separate 
     account under this subparagraph shall not accrue interest, 
     shall not be treated as assets of the plan, and shall not be 
     commingled with any other assets of the plan.
       ``(G) Plan amendments.--The administrator of each 
     multiemployer plan shall amend the plan documents to allow 
     for deductions from benefits pursuant to this paragraph.
       ``(H) Preemption.--This paragraph shall supersede any law 
     of a State which would directly or indirectly prohibit or 
     restrict an employer, plan, or labor organization from 
     withholding or remitting premium amounts in accordance with 
     this paragraph.
       ``(I) Determination of plan status.--
       ``(i) In general.--Except as otherwise provided by the 
     regulations issued pursuant to clause (ii), for purposes of 
     determining premiums due under this paragraph, the plan's 
     status shall be the status certified under section 305 for 
     the first plan year beginning on or after January 1, 2021.
       ``(ii) Subsequent changes in status.--The corporation shall 
     issue regulations regarding the timing required for 
     reflecting, in the amounts withheld, a revised plan status 
     certified at a later date. In no event shall such regulations 
     allow a delay of more than 90 days.
       ``(11) Additional premiums payable by employers and labor 
     organizations.--
       ``(A) In general.--In addition to the amounts payable under 
     paragraph (3), for plan years beginning after December 31, 
     2021, with respect to multiemployer plans, premiums shall be 
     payable to the corporation with respect to employers and 
     labor organizations in accordance with this paragraph.
       ``(B) Employers.--The monthly amount payable by employers, 
     for each employee participating in the plan (as determined 
     under subparagraph (D)) during that month is--
       ``(i) $1 in the case of a plan in unrestricted status 
     pursuant to section 305(b)(1)(B), or $1.50 in the case of a 
     plan in stable status pursuant to section 305(b)(1)(A), but 
     only if the plan is not an original plan or a successor plan 
     within the meaning of section 4233A; and
       ``(ii) $2.50 in any other case.
       ``(C) Labor organizations.--The monthly amount payable by 
     labor organizations, for each member paying dues and 
     participating in the plan (as determined under subparagraph 
     (D)) during that month is--
       ``(i) $1 in the case of a plan in unrestricted status 
     pursuant to section 305(b)(1)(B), or $1.50 in the case of a 
     plan in stable status pursuant to section 305(b)(1)(A), but 
     only if the plan is not an original plan or a successor plan 
     within the meaning of section 4233A; and
       ``(ii) $2.50 in any other case.
       ``(D) Persons participating in the plan.--For purposes of 
     subparagraphs (B) and (C), an employee or member 
     participating in the plan during any month is a person with 
     respect to whom the employer had an obligation to contribute 
     to the plan under the terms of a collective bargaining 
     agreement or other participation agreement for that month.
       ``(E) Remittance.--Premiums required under subparagraph (B) 
     or (C) shall be remitted to the plan monthly and held in a 
     separate account until remittance, as prescribed in 
     subparagraph (F). In the case of a participant or beneficiary 
     on whose behalf more than one employer contributed during a 
     month, the plan may elect to apportion the monthly amount to 
     the employers on a proportional basis. Amounts held in a 
     separate account under this subparagraph shall not accrue 
     interest, shall not be treated as assets of the plan, and 
     shall not be commingled with any other assets of the plan.
       ``(F) Submission to the corporation.--Each plan shall 
     submit the premiums under subparagraph (E) to the 
     corporation, on an annual basis, as prescribed by regulations 
     of the corporation.
       ``(G) Determination of plan status.--
       ``(i) In general.--Except as otherwise provided by the 
     regulations issued pursuant to clause (ii), for purposes of 
     determining premiums due under this paragraph, the plan's 
     status shall be the status certified under section 305 for 
     the first plan year beginning on or after January 1, 2021.
       ``(ii) Subsequent changes in status.--The corporation shall 
     issue regulations regarding the timing required for 
     reflecting, in the amounts due, a revised plan status 
     certified at a later date. In no event shall such regulations 
     allow a delay of more than 90 days.''.
       (d) Payment of Premiums.--
       (1) Applicability of premiums.--Section 4007(b) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1307(b)) is amended by adding at the end the following:
       ``(3)(A)(i) The following plans shall not owe a variable 
     rate premium determined under section 4006(a)(3)(N):
       ``(I) An insolvent plan that has commenced receiving 
     financial assistance.
       ``(II) A plan which is certified by the plan actuary under 
     section 305 as being in unrestricted status pursuant to 
     section 305(b)(1)(B), and which is not an original plan 
     within the meaning of section 4233A.
       ``(III) With respect to plan years beginning before January 
     1, 2025, a plan which is certified by the plan actuary under 
     section 305 as being in stable status pursuant to section 
     305(b)(1)(A), and which is not an original plan within the 
     meaning of section 4233A.
       ``(ii) An insolvent plan that has commenced receiving 
     financial assistance shall not owe the flat rate premium 
     under section 4006(a)(3)(A)(viii)(I).
       ``(B) In the case of a special partition under section 
     4233A, the original plan shall calculate and remit premiums 
     under section 4006 as if the original plan and successor plan 
     were one plan and the successor plan shall not be required to 
     remit any such premiums.
       ``(4) Paragraph (1) shall apply to the additional premiums 
     required by section 4006(a)(10) and (11).''.
       (2) Authorized civil actions.--Section 4007(c) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1307(c)) is amended by inserting after the first sentence the 
     following: ``The corporation is authorized to bring a civil 
     action to prevent or correct any action by a designated 
     payor, if a principal purpose of the action by the designated 
     payor is to evade or avoid the payment of premiums, and the 
     corporation shall be authorized to recover the amount of 
     premium that should have been paid by such payor, plus a late 
     payment penalty and interest.''.
       (e) Reporting on Premium Increases and Guarantee 
     Reductions.--Section 4008 of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1308) is amended by adding at 
     the end the following:
       ``(c) Beginning with the report for fiscal year 2025, if 
     the corporation projects in its reporting under this section 
     that the corporation's multiemployer plan program will not 
     remain solvent for at least 10 years after the date of the 
     report, the corporation shall include in the report a 
     recommendation for a balanced combination of premium 
     increases and guarantee reductions needed to ensure solvency 
     for the next 20 years without respect to any loans under 
     section 4005. Such recommendations shall be automatically 
     adopted at the beginning of the next fiscal year unless 
     Congress takes other action.''.
       (f) Delinquent Contributions.--
       (1) In general.--Section 515 of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1145) is amended--
       (A) by striking ``contributions.--Every'', and inserting 
     ``contributions and premiums.--
       ``(a) In General.--Every'', and
       (B) by adding at the end the following new subsection:
       ``(b) Premiums.--Every employer or labor organization which 
     is obligated to remit premiums with respect to a 
     multiemployer plan under section 4006 shall remit such 
     premiums to the plan in accordance with the terms of the plan 
     and regulations issued by the corporation.''.
       (2) Civil enforcement.--Section 502(g)(2)(A) of such Act 
     (29 U.S.C. 1132(g)(2)(A)) is amended by striking 
     ``contributions,'' and inserting ``contributions or 
     premiums,''.

     SEC. 602. FUNDING.

       (a) Loans to the Corporation for the Fund to Pay Basic 
     Benefits.--Section 4005 of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1305) is amended by adding at 
     the end the following:
       ``(i)(1) The corporation may borrow from the Secretary of 
     the Treasury such funds as are necessary to pay basic 
     benefits guaranteed under section 4022A or expenses related 
     to the corporation's multiemployer plan program if the 
     balance of assets in the revolving fund established under 
     subsection (a) for purposes of paying such benefits is 
     $500,000,000 or less within that year. The corporation may 
     invest amounts so borrowed in accordance with subsection 
     (b)(3)(A).
       ``(2) Amounts borrowed under this subsection shall be--
       ``(A) issued at an annual interest rate of 0 percent; and
       ``(B) repaid by the corporation--
       ``(i) beginning 20 years after the date on which the loan 
     is issued;
       ``(ii) over a period of not more than 20 years from 
     commencement of repayment; and
       ``(iii) out of the fund established under subsection (a) to 
     pay basic benefits guaranteed under section 4022A.
       ``(3) The corporation shall notify the Committee on Health, 
     Education, Labor, and Pensions and the Committee on Finance 
     of the Senate and the Committee on Education and Labor and 
     the Committee on Ways and Means of the House of 
     Representatives within 14 days of requesting a loan under 
     this subsection.
       ``(4) Beginning on January 1, 2021, if, as of the close of 
     any calendar year the outstanding balance of the loans 
     provided to the corporation during the previous year under 
     this subsection exceeded $2,000,000,000, the multiemployer 
     flat-rate premium rates applicable under section 4006(a) 
     solely for plan

[[Page S7634]]

     years beginning in the immediately succeeding calendar year 
     shall be increased by 20 percent.''.
       (b) Study on Funding for Basic Benefit Guarantee.--Section 
     4022A(f) of the Employee Retirement Income Security Act of 
     1974 (29 U.S.C. 1322a(f)) is amended--
       (1) by striking ``Committee on Labor and Human Resources'' 
     each place such term appears and inserting ``Committee on 
     Health, Education, Labor, and Pensions'';
       (2) in paragraph (1)(A)--
       (A) in clause (i), by striking ``, and'' and inserting a 
     semicolon; and
       (B) by inserting after clause (ii) the following:
       ``(iii) whether the Corporation projects that the loans 
     issued under section 4005(i) will be repaid in accordance 
     with the schedule set forth in paragraph (2)(B) of such 
     section; and'';
       (3) in paragraph (2)--
       (A) in subparagraph (A)--
       (i) in the matter preceding clause (i), by inserting ``and 
     repayment of loans under section 4005(i)'' after 
     ``multiemployer plans''; and
       (ii) in clause (ii), by inserting ``, and repayment of any 
     loans issued under section 4005(i)'' before the comma at the 
     end; and
       (B) in subparagraph (C), by striking ``second''; and
       (4) in paragraph (3)(A)(ii), by inserting ``and repayment 
     of loans issued under section 4005(i)'' before the period.

     SEC. 603. COMPOSITE PLAN TRANSITION FEE.

       (a) In General.--Section 4006(a) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1306(a)), as amended 
     by this Act, is further is amended by adding at the end the 
     following:
       ``(12) Composite plan transition fee.--Notwithstanding 
     paragraph (9), in any year after 2024, a composite plan (as 
     defined in section 801(a)) shall remit to the legacy plan 
     (within the meaning of section 805) $15 per participant that 
     is not also a participant in the legacy plan. The legacy plan 
     shall remit such amount to the corporation in addition to its 
     premiums otherwise required under this section.''.
       (b) Conforming Amendment.--Section 4007(b)(4) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1307(b)(4)), as added by section 601, is amended by inserting 
     ``, and the transition fees required by section 4006(a)(12)'' 
     before the period.

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