[Congressional Record (Bound Edition), Volume 156 (2010), Part 7]
[Senate]
[Pages 10092-10140]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

   SA 4301. Mr. BAUCUS proposed an amendment to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; as follows:

       In lieu of the matter proposed to be inserted by the 
     amendment of the House, insert the following:

     SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE; TABLE OF 
                   CONTENTS.

       (a) Short Title.--This Act may be cited as the ``American 
     Jobs and Closing Tax Loopholes Act of 2010''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in titles I, II, and IV of this Act an 
     amendment or repeal is expressed in terms of an amendment to, 
     or repeal of, a section or other provision, the reference 
     shall be considered to be made to a section or other 
     provision of the Internal Revenue Code of 1986.
       (c) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; amendment of 1986 Code; table of contents.

                   TITLE I--INFRASTRUCTURE INCENTIVES

Sec. 101. Extension of Build America Bonds.
Sec. 102. Exempt-facility bonds for sewage and water supply facilities.
Sec. 103. Extension of exemption from alternative minimum tax treatment 
              for certain tax-exempt bonds.
Sec. 104. Extension and additional allocations of recovery zone bond 
              authority.
Sec. 105. Allowance of new markets tax credit against alternative 
              minimum tax.
Sec. 106. Extension of tax-exempt eligibility for loans guaranteed by 
              Federal home loan banks.
Sec. 107. Extension of temporary small issuer rules for allocation of 
              tax-exempt interest expense by financial institutions.

               TITLE II--EXTENSION OF EXPIRING PROVISIONS

                           Subtitle A--Energy

Sec. 201. Alternative motor vehicle credit for new qualified hybrid 
              motor vehicles other than passenger automobiles and light 
              trucks.
Sec. 202. Incentives for biodiesel and renewable diesel.
Sec. 203. Credit for electricity produced at certain open-loop biomass 
              facilities.
Sec. 204. Extension and modification of credit for steel industry fuel.
Sec. 205. Credit for producing fuel from coke or coke gas.
Sec. 206. New energy efficient home credit.
Sec. 207. Excise tax credits and outlay payments for alternative fuel 
              and alternative fuel mixtures.
Sec. 208. Special rule for sales or dispositions to implement FERC or 
              State electric restructuring policy for qualified 
              electric utilities.
Sec. 209. Suspension of limitation on percentage depletion for oil and 
              gas from marginal wells.
Sec. 210. Direct payment of energy efficient appliances tax credit.
Sec. 211. Modification of standards for windows, doors, and skylights 
              with respect to the credit for nonbusiness energy 
              property.

                   Subtitle B--Individual Tax Relief

                    PART I--Miscellaneous Provisions

Sec. 221. Deduction for certain expenses of elementary and secondary 
              school teachers.
Sec. 222. Additional standard deduction for State and local real 
              property taxes.
Sec. 223. Deduction of State and local sales taxes.
Sec. 224. Contributions of capital gain real property made for 
              conservation purposes.
Sec. 225. Above-the-line deduction for qualified tuition and related 
              expenses.
Sec. 226. Tax-free distributions from individual retirement plans for 
              charitable purposes.
Sec. 227. Look-thru of certain regulated investment company stock in 
              determining gross estate of nonresidents.

                  PART II--Low-income Housing Credits

Sec. 231. Election for direct payment of low-income housing credit for 
              2010.

                    Subtitle C--Business Tax Relief

Sec. 241. Research credit.
Sec. 242. Indian employment tax credit.
Sec. 243. New markets tax credit.
Sec. 244. Railroad track maintenance credit.
Sec. 245. Mine rescue team training credit.

[[Page 10093]]

Sec. 246. Employer wage credit for employees who are active duty 
              members of the uniformed services.
Sec. 247. 5-year depreciation for farming business machinery and 
              equipment.
Sec. 248. 15-year straight-line cost recovery for qualified leasehold 
              improvements, qualified restaurant buildings and 
              improvements, and qualified retail improvements.
Sec. 249. 7-year recovery period for motorsports entertainment 
              complexes.
Sec. 250. Accelerated depreciation for business property on an Indian 
              reservation.
Sec. 251. Enhanced charitable deduction for contributions of food 
              inventory.
Sec. 252. Enhanced charitable deduction for contributions of book 
              inventories to public schools.
Sec. 253. Enhanced charitable deduction for corporate contributions of 
              computer inventory for educational purposes.
Sec. 254. Election to expense mine safety equipment.
Sec. 255. Special expensing rules for certain film and television 
              productions.
Sec. 256. Expensing of environmental remediation costs.
Sec. 257. Deduction allowable with respect to income attributable to 
              domestic production activities in Puerto Rico.
Sec. 258. Modification of tax treatment of certain payments to 
              controlling exempt organizations.
Sec. 259. Exclusion of gain or loss on sale or exchange of certain 
              brownfield sites from unrelated business income.
Sec. 260. Timber REIT modernization.
Sec. 261. Treatment of certain dividends of regulated investment 
              companies.
Sec. 262. RIC qualified investment entity treatment under FIRPTA.
Sec. 263. Exceptions for active financing income.
Sec. 264. Look-thru treatment of payments between related controlled 
              foreign corporations under foreign personal holding 
              company rules.
Sec. 265. Basis adjustment to stock of S corps making charitable 
              contributions of property.
Sec. 266. Empowerment zone tax incentives.
Sec. 267. Tax incentives for investment in the District of Columbia.
Sec. 268. Renewal community tax incentives.
Sec. 269. Temporary increase in limit on cover over of rum excise taxes 
              to Puerto Rico and the Virgin Islands.
Sec. 270. Payment to American Samoa in lieu of extension of economic 
              development credit.
Sec. 271. Election to temporarily utilize unused AMT credits determined 
              by domestic investment.
Sec. 272. Study of extended tax expenditures.

            Subtitle D--Temporary Disaster Relief Provisions

                    PART I--National Disaster Relief

Sec. 281. Waiver of certain mortgage revenue bond requirements.
Sec. 282. Losses attributable to federally declared disasters.
Sec. 283. Special depreciation allowance for qualified disaster 
              property.
Sec. 284. Net operating losses attributable to federally declared 
              disasters.
Sec. 285. Expensing of qualified disaster expenses.

                      PART II--Regional Provisions

                    subpart a--new york liberty zone

Sec. 291. Special depreciation allowance for nonresidential and 
              residential real property.
Sec. 292. Tax-exempt bond financing.

                           subpart b--go zone

Sec. 295. Increase in rehabilitation credit.
Sec. 296. Work opportunity tax credit with respect to certain 
              individuals affected by Hurricane Katrina for employers 
              inside disaster areas.
Sec. 297. Extension of low-income housing credit rules for buildings in 
              GO zones.

                   TITLE III--PENSION FUNDING RELIEF

                   Subtitle A--Single-Employer Plans

Sec. 301. Extended period for single-employer defined benefit plans to 
              amortize certain shortfall amortization bases.
Sec. 302. Application of extended amortization period to plans subject 
              to prior law funding rules.
Sec. 303. Suspension of certain funding level limitations.
Sec. 304. Lookback for credit balance rule.
Sec. 305. Information reporting.
Sec. 306. Rollover of amounts received in airline carrier bankruptcy.

                    Subtitle B--Multiemployer Plans

Sec. 311. Optional use of 30-year amortization periods.
Sec. 312. Optional longer recovery periods for multiemployer plans in 
              endangered or critical status.
Sec. 313. Modification of certain amortization extensions under prior 
              law.
Sec. 314. Alternative default schedule for plans in endangered or 
              critical status.
Sec. 315. Transition rule for certifications of plan status.

                       TITLE IV--REVENUE OFFSETS

                     Subtitle A--Foreign Provisions

Sec. 401. Rules to prevent splitting foreign tax credits from the 
              income to which they relate.
Sec. 402. Denial of foreign tax credit with respect to foreign income 
              not subject to United States taxation by reason of 
              covered asset acquisitions.
Sec. 403. Separate application of foreign tax credit limitation, etc., 
              to items resourced under treaties.
Sec. 404. Limitation on the amount of foreign taxes deemed paid with 
              respect to section 956 inclusions.
Sec. 405. Special rule with respect to certain redemptions by foreign 
              subsidiaries.
Sec. 406. Modification of affiliation rules for purposes of rules 
              allocating interest expense.
Sec. 407. Termination of special rules for interest and dividends 
              received from persons meeting the 80-percent foreign 
              business requirements.
Sec. 408. Source rules for income on guarantees.
Sec. 409. Limitation on extension of statute of limitations for failure 
              to notify Secretary of certain foreign transfers.

    Subtitle B--Personal Service Income Earned in Pass-thru Entities

Sec. 411. Partnership interests transferred in connection with 
              performance of services.
Sec. 412. Income of partners for performing investment management 
              services treated as ordinary income received for 
              performance of services.
Sec. 413. Employment tax treatment of professional service businesses.

                    Subtitle C--Corporate Provisions

Sec. 421. Treatment of securities of a controlled corporation exchanged 
              for assets in certain reorganizations.
Sec. 422. Taxation of boot received in reorganizations.

                      Subtitle D--Other Provisions

Sec. 431. Modifications with respect to Oil Spill Liability Trust Fund.
Sec. 432. Time for payment of corporate estimated taxes.

          TITLE V--UNEMPLOYMENT, HEALTH, AND OTHER ASSISTANCE

        Subtitle A--Unemployment Insurance and Other Assistance

Sec. 501. Extension of unemployment insurance provisions.
Sec. 502. Coordination of emergency unemployment compensation with 
              regular compensation.
Sec. 503. Extension of the Emergency Contingency Fund.

                     Subtitle B--Health Provisions

Sec. 511. Extension of section 508 reclassifications.
Sec. 512. Repeal of delay of RUG-IV.
Sec. 513. Limitation on reasonable costs payments for certain clinical 
              diagnostic laboratory tests furnished to hospital 
              patients in certain rural areas.
Sec. 514. Funding for claims reprocessing.
Sec. 515. Medicaid and CHIP technical corrections.
Sec. 516. Addition of inpatient drug discount program to 340B drug 
              discount program.
Sec. 517. Continued inclusion of orphan drugs in definition of covered 
              outpatient drugs with respect to children's hospitals 
              under the 340B drug discount program.
Sec. 518. Conforming amendment related to waiver of coinsurance for 
              preventive services.
Sec. 519. Establish a CMS-IRS data match to identify fraudulent 
              providers.
Sec. 520. Clarification of effective date of part B special enrollment 
              period for disabled TRICARE beneficiaries.
Sec. 521. Physician payment update.
Sec. 522. Adjustment to Medicare payment localities.
Sec. 523. Clarification of 3-day payment window.
Sec. 524. Extension of ARRA increase in FMAP.

                       TITLE VI--OTHER PROVISIONS

Sec. 601. Extension of national flood insurance program.
Sec. 602. Allocation of geothermal receipts.
Sec. 603. Small business loan guarantee enhancement extensions.
Sec. 604. Emergency agricultural disaster assistance.

[[Page 10094]]

Sec. 605. Summer employment for youth.
Sec. 606. Housing Trust Fund.
Sec. 607. The Individual Indian Money Account Litigation Settlement Act 
              of 2010.
Sec. 608. Appropriation of funds for final settlement of claims from In 
              re Black Farmers Discrimination Litigation.
Sec. 609. Expansion of eligibility for concurrent receipt of military 
              retired pay and veterans' disability compensation to 
              include all chapter 61 disability retirees regardless of 
              disability rating percentage or years of service.
Sec. 610. Extension of use of 2009 poverty guidelines.
Sec. 611. Refunds disregarded in the administration of Federal programs 
              and federally assisted programs.
Sec. 612. State court improvement program.
Sec. 613. Qualifying timber contract options.
Sec. 614. Extension and flexibility for certain allocated surface 
              transportation programs.
Sec. 615. Community College and Career Training Grant Program.
Sec. 616. Extensions of duty suspensions on cotton shirting fabrics and 
              related provisions.
Sec. 617. Modification of Wool Apparel Manufacturers Trust Fund.
Sec. 618. Department of Commerce Study.
Sec. 619. ARRA planning and reporting.
Sec. 620. Amendment of Travel Promotion Act of 2009.

                    TITLE VII--BUDGETARY PROVISIONS

Sec. 701. Budgetary provisions.

                   TITLE I--INFRASTRUCTURE INCENTIVES

     SEC. 101. EXTENSION OF BUILD AMERICA BONDS.

       (a) In General.--Subparagraph (B) of section 54AA(d)(1) is 
     amended by striking ``January 1, 2011'' and inserting 
     ``January 1, 2013''.
       (b) Extension of Payments to Issuers.--
       (1) In general.--Section 6431 is amended--
       (A) by striking ``January 1, 2011'' in subsection (a) and 
     inserting ``January 1, 2013''; and
       (B) by striking ``January 1, 2011'' in subsection (f)(1)(B) 
     and inserting ``a particular date''.
       (2) Conforming amendments.--Subsection (g) of section 54AA 
     is amended--
       (A) by striking ``January 1, 2011'' and inserting ``January 
     1, 2013''; and
       (B) by striking ``Qualified Bonds Issued Before 2011'' in 
     the heading and inserting ``Certain Qualified Bonds''.
       (c) Reduction in Percentage of Payments to Issuers.--
     Subsection (b) of section 6431 is amended--
       (1) by striking ``The Secretary'' and inserting the 
     following:
       ``(1) In general.--The Secretary'';
       (2) by striking ``35 percent'' and inserting ``the 
     applicable percentage''; and
       (3) by adding at the end the following new paragraph:
       ``(2) Applicable percentage.--For purposes of this 
     subsection, the term `applicable percentage' means the 
     percentage determined in accordance with the following table:

------------------------------------------------------------------------
 ``In the case of a qualified bond issued     The applicable percentage
           during calendar year:                         is:
------------------------------------------------------------------------
2009 or 2010..............................  35 percent
2011......................................  32 percent
2012......................................  30 percent''.
------------------------------------------------------------------------

       (d) Current Refundings Permitted.--Subsection (g) of 
     section 54AA is amended by adding at the end the following 
     new paragraph:
       ``(3) Treatment of current refunding bonds.--
       ``(A) In general.--For purposes of this subsection, the 
     term `qualified bond' includes any bond (or series of bonds) 
     issued to refund a qualified bond if--
       ``(i) the average maturity date of the issue of which the 
     refunding bond is a part is not later than the average 
     maturity date of the bonds to be refunded by such issue,
       ``(ii) the amount of the refunding bond does not exceed the 
     outstanding amount of the refunded bond, and
       ``(iii) the refunded bond is redeemed not later than 90 
     days after the date of the issuance of the refunding bond.
       ``(B) Applicable percentage.--In the case of a refunding 
     bond referred to in subparagraph (A), the applicable 
     percentage with respect to such bond under section 6431(b) 
     shall be the lowest percentage specified in paragraph (2) of 
     such section.
       ``(C) Determination of average maturity.--For purposes of 
     subparagraph (A)(i), average maturity shall be determined in 
     accordance with section 147(b)(2)(A).''.
       (e) Clarification Related to Levees and Flood Control 
     Projects.--Subparagraph (A) of section 54AA(g)(2) is amended 
     by inserting ``(including capital expenditures for levees and 
     other flood control projects)'' after ``capital 
     expenditures''.

     SEC. 102. EXEMPT-FACILITY BONDS FOR SEWAGE AND WATER SUPPLY 
                   FACILITIES.

       (a) Bonds for Water and Sewage Facilities Exempt From 
     Volume Cap on Private Activity Bonds.--
       (1) In general.--Paragraph (3) of section 146(g) is amended 
     by inserting ``(4), (5),'' after ``(2),''.
       (2) Conforming amendment.--Paragraphs (2) and (3)(B) of 
     section 146(k) are both amended by striking ``(4), (5), 
     (6),'' and inserting ``(6)''.
       (b) Tax-exempt Issuance by Indian Tribal Governments.--
       (1) In general.--Subsection (c) of section 7871 is amended 
     by adding at the end the following new paragraph:
       ``(4) Exception for bonds for water and sewage 
     facilities.--Paragraph (2) shall not apply to an exempt 
     facility bond 95 percent or more of the net proceeds (as 
     defined in section 150(a)(3)) of which are to be used to 
     provide facilities described in paragraph (4) or (5) of 
     section 142(a).''.
       (2) Conforming amendment.--Paragraph (2) of section 7871(c) 
     is amended by striking ``paragraph (3)'' and inserting 
     ``paragraphs (3) and (4)''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after the date of the 
     enactment of this Act.

     SEC. 103. EXTENSION OF EXEMPTION FROM ALTERNATIVE MINIMUM TAX 
                   TREATMENT FOR CERTAIN TAX-EXEMPT BONDS.

       (a) In General.--Clause (vi) of section 57(a)(5)(C) is 
     amended--
       (1) by striking ``January 1, 2011'' in subclause (I) and 
     inserting ``January 1, 2012''; and
       (2) by striking ``and 2010'' in the heading and inserting 
     ``, 2010, and 2011''.
       (b) Adjusted Current Earnings.--Clause (iv) of section 
     56(g)(4)(B) is amended--
       (1) by striking ``January 1, 2011'' in subclause (I) and 
     inserting ``January 1, 2012''; and
       (2) by striking ``and 2010'' in the heading and inserting 
     ``, 2010, and 2011''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after December 31, 2010.

     SEC. 104. EXTENSION AND ADDITIONAL ALLOCATIONS OF RECOVERY 
                   ZONE BOND AUTHORITY.

       (a) Extension of Recovery Zone Bond Authority.--Section 
     1400U-2(b)(1) and section 1400U-3(b)(1)(B) are each amended 
     by striking ``January 1, 2011'' and inserting ``January 1, 
     2012''.
       (b) Additional Allocations of Recovery Zone Bond Authority 
     Based on Unemployment.--Section 1400U-1 is amended by adding 
     at the end the following new subsection:
       ``(c) Allocation of 2010 Recovery Zone Bond Limitations 
     Based on Unemployment.--
       ``(1) In general.--The Secretary shall allocate the 2010 
     national recovery zone economic development bond limitation 
     and the 2010 national recovery zone facility bond limitation 
     among the States in the proportion that each such State's 
     2009 unemployment number bears to the aggregate of the 2009 
     unemployment numbers for all of the States.
       ``(2) Minimum allocation.--The Secretary shall adjust the 
     allocations under paragraph (1) for each State to the extent 
     necessary to ensure that no State (prior to any reduction 
     under paragraph (3)) receives less than 0.9 percent of the 
     2010 national recovery zone economic development bond 
     limitation and 0.9 percent of the 2010 national recovery zone 
     facility bond limitation.
       ``(3) Allocations by states.--
       ``(A) In general.--Each State with respect to which an 
     allocation is made under paragraph (1) shall reallocate such 
     allocation among the counties and large municipalities (as 
     defined in subsection (a)(3)(B)) in such State in the 
     proportion that each such county's or municipality's 2009 
     unemployment number bears to the aggregate of the 2009 
     unemployment numbers for all the counties and large 
     municipalities (as so defined) in such State.
       ``(B) 2010 allocation reduced by amount of previous 
     allocation.--Each State shall reduce (but not below zero)--
       ``(i) the amount of the 2010 national recovery zone 
     economic development bond limitation allocated to each county 
     or large municipality (as so defined) in such State by the 
     amount of the national recovery zone economic development 
     bond limitation allocated to such county or large 
     municipality under subsection (a)(3)(A) (determined without 
     regard to any waiver thereof), and
       ``(ii) the amount of the 2010 national recovery zone 
     facility bond limitation allocated to each county or large 
     municipality (as so defined) in such State by the amount of 
     the national recovery zone facility bond limitation allocated 
     to such county or large municipality under subsection 
     (a)(3)(A) (determined without regard to any waiver thereof).
       ``(C) Waiver of suballocations.--A county or municipality 
     may waive any portion of an allocation made under this 
     paragraph. A county or municipality shall be treated as 
     having waived any portion of an allocation made under this 
     paragraph which has not been allocated to a bond issued 
     before May 1, 2011. Any allocation waived (or treated as 
     waived) under this subparagraph may be used or reallocated by 
     the State.
       ``(D) Special rule for a municipality in a county.--In the 
     case of any large municipality any portion of which is in a 
     county, such portion shall be treated as part of such 
     municipality and not part of such county.

[[Page 10095]]

       ``(4) 2009 unemployment number.--For purposes of this 
     subsection, the term `2009 unemployment number' means, with 
     respect to any State, county or municipality, the number of 
     individuals in such State, county, or municipality who were 
     determined to be unemployed by the Bureau of Labor Statistics 
     for December 2009.
       ``(5) 2010 national limitations.--
       ``(A) Recovery zone economic development bonds.--The 2010 
     national recovery zone economic development bond limitation 
     is $10,000,000,000. Any allocation of such limitation under 
     this subsection shall be treated for purposes of section 
     1400U-2 in the same manner as an allocation of national 
     recovery zone economic development bond limitation.
       ``(B) Recovery zone facility bonds.--The 2010 national 
     recovery zone facility bond limitation is $15,000,000,000. 
     Any allocation of such limitation under this subsection shall 
     be treated for purposes of section 1400U-3 in the same manner 
     as an allocation of national recovery zone facility bond 
     limitation.''.
       (c) Authority of State to Waive Certain 2009 Allocations.--
     Subparagraph (A) of section 1400U-1(a)(3) is amended by 
     adding at the end the following: ``A county or municipality 
     shall be treated as having waived any portion of an 
     allocation made under this subparagraph which has not been 
     allocated to a bond issued before May 1, 2011. Any allocation 
     waived (or treated as waived) under this subparagraph may be 
     used or reallocated by the State.''.

     SEC. 105. ALLOWANCE OF NEW MARKETS TAX CREDIT AGAINST 
                   ALTERNATIVE MINIMUM TAX.

       (a) In General.--Subparagraph (B) of section 38(c)(4), as 
     amended by the Patient Protection and Affordable Care Act, is 
     amended by redesignating clauses (v) through (ix) as clauses 
     (vi) through (x), respectively, and by inserting after clause 
     (iv) the following new clause:
       ``(v) the credit determined under section 45D, but only 
     with respect to credits determined with respect to qualified 
     equity investments (as defined in section 45D(b)) initially 
     made before January 1, 2012,''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to credits determined with respect to qualified 
     equity investments (as defined in section 45D(b) of the 
     Internal Revenue Code of 1986) initially made after March 15, 
     2010.

     SEC. 106. EXTENSION OF TAX-EXEMPT ELIGIBILITY FOR LOANS 
                   GUARANTEED BY FEDERAL HOME LOAN BANKS.

       Clause (iv) of section 149(b)(3)(A) is amended by striking 
     ``December 31, 2010'' and inserting ``December 31, 2011''.

     SEC. 107. EXTENSION OF TEMPORARY SMALL ISSUER RULES FOR 
                   ALLOCATION OF TAX-EXEMPT INTEREST EXPENSE BY 
                   FINANCIAL INSTITUTIONS.

       (a) In General.--Clauses (i), (ii), and (iii) of section 
     265(b)(3)(G) are each amended by striking ``or 2010'' and 
     inserting ``, 2010, or 2011''.
       (b) Conforming Amendment.--Subparagraph (G) of section 
     265(b)(3) is amended by striking ``and 2010'' in the heading 
     and inserting ``, 2010, and 2011''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after December 31, 2010.

               TITLE II--EXTENSION OF EXPIRING PROVISIONS

                           Subtitle A--Energy

     SEC. 201. ALTERNATIVE MOTOR VEHICLE CREDIT FOR NEW QUALIFIED 
                   HYBRID MOTOR VEHICLES OTHER THAN PASSENGER 
                   AUTOMOBILES AND LIGHT TRUCKS.

       (a) In General.--Paragraph (3) of section 30B(k) is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property purchased after December 31, 2009.

     SEC. 202. INCENTIVES FOR BIODIESEL AND RENEWABLE DIESEL.

       (a) Credits for Biodiesel and Renewable Diesel Used as 
     Fuel.--Subsection (g) of section 40A is amended by striking 
     ``December 31, 2009'' and inserting ``December 31, 2010''.
       (b) Excise Tax Credits and Outlay Payments for Biodiesel 
     and Renewable Diesel Fuel Mixtures.--
       (1) Paragraph (6) of section 6426(c) is amended by striking 
     ``December 31, 2009'' and inserting ``December 31, 2010''.
       (2) Subparagraph (B) of section 6427(e)(6) is amended by 
     striking ``December 31, 2009'' and inserting ``December 31, 
     2010''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to fuel sold or used after December 31, 2009.

     SEC. 203. CREDIT FOR ELECTRICITY PRODUCED AT CERTAIN OPEN-
                   LOOP BIOMASS FACILITIES.

       (a) In General.--Clause (ii) of section 45(b)(4)(B) is 
     amended--
       (1) by striking ``5-year period'' and inserting ``6-year 
     period''; and
       (2) by adding at the end the following: ``In the case of 
     the last year of the 6-year period described in the preceding 
     sentence, the credit determined under subsection (a) with 
     respect to electricity produced during such year shall not 
     exceed 80 percent of such credit determined without regard to 
     this sentence.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to electricity produced and sold after December 
     31, 2009.

     SEC. 204. EXTENSION AND MODIFICATION OF CREDIT FOR STEEL 
                   INDUSTRY FUEL.

       (a) Credit Period.--
       (1) In general.--Subclause (II) of section 45(e)(8)(D)(ii) 
     is amended to read as follows:

       ``(II) Credit period.--In lieu of the 10-year period 
     referred to in clauses (i) and (ii)(II) of subparagraph (A), 
     the credit period shall be the period beginning on the date 
     that the facility first produces steel industry fuel that is 
     sold to an unrelated person after September 30, 2008, and 
     ending 2 years after such date.''.

       (2) Conforming amendment.--Section 45(e)(8)(D) is amended 
     by striking clause (iii) and by redesignating clause (iv) as 
     clause (iii).
       (b) Extension of Placed-in-service Date.--Subparagraph (A) 
     of section 45(d)(8) is amended--
       (1) by striking ``(or any modification to a facility)''; 
     and
       (2) by inserting ``or after the date of the enactment of 
     the American Jobs and Closing Tax Loopholes Act of 2010 and 
     before January 1, 2011,'' after ``2010,''.
       (c) Clarifications.--
       (1) Steel industry fuel.--Subclause (I) of section 
     45(c)(7)(C)(i) is amended by inserting ``, a blend of coal 
     and petroleum coke, or other coke feedstock'' after ``on 
     coal''.
       (2) Ownership interest.--Section 45(d)(8) is amended by 
     adding at the end the following new flush sentence:

     ``With respect to a facility producing steel industry fuel, 
     no person (including a ground lessor, customer, supplier, or 
     technology licensor) shall be treated as having an ownership 
     interest in the facility or as otherwise entitled to the 
     credit allowable under subsection (a) with respect to such 
     facility if such person's rent, license fee, or other 
     entitlement to net payments from the owner of such facility 
     is measured by a fixed dollar amount or a fixed amount per 
     ton, or otherwise determined without regard to the profit or 
     loss of such facility.''.
       (3) Production and sale.--Subparagraph (D) of section 
     45(e)(8), as amended by subsection (a)(2), is amended by 
     redesignating clause (iii) as clause (iv) and by inserting 
     after clause (ii) the following new clause:
       ``(iii) Production and sale.--The owner of a facility 
     producing steel industry fuel shall be treated as producing 
     and selling steel industry fuel where that owner manufactures 
     such steel industry fuel from coal, a blend of coal and 
     petroleum coke, or other coke feedstock to which it has 
     title. The sale of such steel industry fuel by the owner of 
     the facility to a person who is not the owner of the facility 
     shall not fail to qualify as a sale to an unrelated person 
     solely because such purchaser may also be a ground lessor, 
     supplier, or customer.''.
       (d) Specified Credit for Purposes of Alternative Minimum 
     Tax Exclusion.--Subclause (II) of section 38(c)(4)(B)(iii) is 
     amended by inserting ``(in the case of a refined coal 
     production facility producing steel industry fuel, during the 
     credit period set forth in section 45(e)(8)(D)(ii)(II))'' 
     after ``service''.
       (e) Effective Dates.--
       (1) In general.--The amendments made by subsections (a), 
     (b), and (d) shall take effect on the date of the enactment 
     of this Act.
       (2) Clarifications.--The amendments made by subsection (c) 
     shall take effect as if included in the amendments made by 
     the Energy Improvement and Extension Act of 2008.

     SEC. 205. CREDIT FOR PRODUCING FUEL FROM COKE OR COKE GAS.

       (a) In General.--Paragraph (1) of section 45K(g) is amended 
     by striking ``January 1, 2010'' and inserting ``January 1, 
     2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to facilities placed in service after December 
     31, 2009.

     SEC. 206. NEW ENERGY EFFICIENT HOME CREDIT.

       (a) In General.--Subsection (g) of section 45L is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to homes acquired after December 31, 2009.

     SEC. 207. EXCISE TAX CREDITS AND OUTLAY PAYMENTS FOR 
                   ALTERNATIVE FUEL AND ALTERNATIVE FUEL MIXTURES.

       (a) Alternative Fuel Credit.--Paragraph (5) of section 
     6426(d) is amended by striking ``after December 31, 2009'' 
     and all that follows and inserting ``after--
       ``(A) September 30, 2014, in the case of liquefied 
     hydrogen,
       ``(B) December 31, 2010, in the case of fuels described in 
     subparagraph (A), (C), (F), or (G) of paragraph (2), and
       ``(C) December 31, 2009, in any other case.''.
       (b) Alternative Fuel Mixture Credit.--Paragraph (3) of 
     section 6426(e) is amended by striking ``after December 31, 
     2009'' and all that follows and inserting ``after--
       ``(A) September 30, 2014, in the case of liquefied 
     hydrogen,
       ``(B) December 31, 2010, in the case of fuels described in 
     subparagraph (A), (C), (F), or (G) of subsection (d)(2), and
       ``(C) December 31, 2009, in any other case.''.

[[Page 10096]]

       (c) Payment Authority.--
       (1) In general.--Paragraph (6) of section 6427(e) is 
     amended by striking ``and'' at the end of subparagraph (C), 
     by striking the period at the end of subparagraph (D) and 
     inserting ``, and'', and by adding at the end the following 
     new subparagraph:
       ``(E) any alternative fuel or alternative fuel mixture (as 
     so defined) involving fuel described in subparagraph (A), 
     (C), (F), or (G) of section 6426(d)(2) sold or used after 
     December 31, 2010.''.
       (2) Conforming amendment.--Subparagraph (C) of section 
     6427(e)(6) is amended by inserting ``or (E)'' after 
     ``subparagraph (D)''.
       (d) Exclusion of Black Liquor From Credit Eligibility.--The 
     last sentence of section 6426(d)(2) is amended by striking 
     ``or biodiesel'' and inserting ``biodiesel, or any fuel 
     (including lignin, wood residues, or spent pulping liquors) 
     derived from the production of paper or pulp''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to fuel sold or used after December 31, 2009.

     SEC. 208. SPECIAL RULE FOR SALES OR DISPOSITIONS TO IMPLEMENT 
                   FERC OR STATE ELECTRIC RESTRUCTURING POLICY FOR 
                   QUALIFIED ELECTRIC UTILITIES.

       (a) In General.--Paragraph (3) of section 451(i) is amended 
     by striking ``January 1, 2010'' and inserting ``January 1, 
     2011''.
       (b) Modification of Definition of Independent Transmission 
     Company.--
       (1) In general.--Clause (i) of section 451(i)(4)(B) is 
     amended to read as follows:
       ``(i) who the Federal Energy Regulatory Commission 
     determines in its authorization of the transaction under 
     section 203 of the Federal Power Act (16 U.S.C. 824b) or by 
     declaratory order--

       ``(I) is not itself a market participant as determined by 
     the Commission, and also is not controlled by any such market 
     participant, or
       ``(II) to be independent from market participants or to be 
     an independent transmission company within the meaning of 
     such Commission's rules applicable to independent 
     transmission providers, and''.

       (2) Related persons.--Paragraph (4) of section 451(i) is 
     amended by adding at the end the following flush sentence:

     ``For purposes of subparagraph (B)(i)(I), a person shall be 
     treated as controlled by another person if such persons would 
     be treated as a single employer under section 52.''.
       (c) Effective Date.--
       (1) In general.--The amendment made by subsection (a) shall 
     apply to dispositions after December 31, 2009.
       (2) Modifications.--The amendments made by subsection (b) 
     shall apply to dispositions after the date of the enactment 
     of this Act.

     SEC. 209. SUSPENSION OF LIMITATION ON PERCENTAGE DEPLETION 
                   FOR OIL AND GAS FROM MARGINAL WELLS.

       (a) In General.--Clause (ii) of section 613A(c)(6)(H) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 210. DIRECT PAYMENT OF ENERGY EFFICIENT APPLIANCES TAX 
                   CREDIT.

       In the case of any taxable year which includes the last day 
     of calendar year 2009 or calendar year 2010, a taxpayer who 
     elects to waive the credit which would otherwise be 
     determined with respect to the taxpayer under section 45M of 
     the Internal Revenue Code of 1986 for such taxable year shall 
     be treated as making a payment against the tax imposed under 
     subtitle A of such Code for such taxable year in an amount 
     equal to 85 percent of the amount of the credit which would 
     otherwise be so determined. Such payment shall be treated as 
     made on the later of the due date of the return of such tax 
     or the date on which such return is filed. Elections under 
     this section may be made separately for 2009 and 2010, but 
     once made shall be irrevocable. No amount shall be includible 
     in gross income or alternative minimum taxable income by 
     reason of this section.

     SEC. 211. MODIFICATION OF STANDARDS FOR WINDOWS, DOORS, AND 
                   SKYLIGHTS WITH RESPECT TO THE CREDIT FOR 
                   NONBUSINESS ENERGY PROPERTY.

       (a) In General.--Paragraph (4) of section 25C(c) is amended 
     by striking ``unless'' and all that follows and inserting 
     ``unless--
       ``(A) in the case of any component placed in service after 
     the date which is 90 days after the date of the enactment of 
     the American Jobs and Closing Tax Loopholes Act of 2010, such 
     component meets the criteria for such components established 
     by the 2010 Energy Star Program Requirements for Residential 
     Windows, Doors, and Skylights, Version 5.0 (or any subsequent 
     version of such requirements which is in effect after January 
     4, 2010),
       ``(B) in the case of any component placed in service after 
     the date of the enactment of the American Jobs and Closing 
     Tax Loopholes Act of 2010 and on or before the date which is 
     90 days after such date, such component meets the criteria 
     described in subparagraph (A) or is equal to or below a U 
     factor of 0.30 and SHGC of 0.30, and
       ``(C) in the case of any component which is a garage door, 
     such component is equal to or below a U factor of 0.30 and 
     SHGC of 0.30.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act.

                   Subtitle B--Individual Tax Relief

                    PART I--MISCELLANEOUS PROVISIONS

     SEC. 221. DEDUCTION FOR CERTAIN EXPENSES OF ELEMENTARY AND 
                   SECONDARY SCHOOL TEACHERS.

       (a) In General.--Subparagraph (D) of section 62(a)(2) is 
     amended by striking ``or 2009'' and inserting ``2009, or 
     2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 222. ADDITIONAL STANDARD DEDUCTION FOR STATE AND LOCAL 
                   REAL PROPERTY TAXES.

       (a) In General.--Subparagraph (C) of section 63(c)(1) is 
     amended by striking ``or 2009'' and inserting ``2009, or 
     2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 223. DEDUCTION OF STATE AND LOCAL SALES TAXES.

       (a) In General.--Subparagraph (I) of section 164(b)(5) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 224. CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY MADE 
                   FOR CONSERVATION PURPOSES.

       (a) In General.--Clause (vi) of section 170(b)(1)(E) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Contributions by Certain Corporate Farmers and 
     Ranchers.--Clause (iii) of section 170(b)(2)(B) is amended by 
     striking ``December 31, 2009'' and inserting ``December 31, 
     2010''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to contributions made in taxable years beginning 
     after December 31, 2009.

     SEC. 225. ABOVE-THE-LINE DEDUCTION FOR QUALIFIED TUITION AND 
                   RELATED EXPENSES.

       (a) In General.--Subsection (e) of section 222 is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.
       (c) Temporary Coordination With Hope and Lifetime Learning 
     Credits.--In the case of any taxpayer for any taxable year 
     beginning in 2010, no deduction shall be allowed under 
     section 222 of the Internal Revenue Code of 1986 if--
       (1) the taxpayer's net Federal income tax reduction which 
     would be attributable to such deduction for such taxable 
     year, is less than
       (2) the credit which would be allowed to the taxpayer for 
     such taxable year under section 25A of such Code (determined 
     without regard to sections 25A(e) and 26 of such Code).

     SEC. 226. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT 
                   PLANS FOR CHARITABLE PURPOSES.

       (a) In General.--Subparagraph (F) of section 408(d)(8) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to distributions made in taxable years beginning 
     after December 31, 2009.

     SEC. 227. LOOK-THRU OF CERTAIN REGULATED INVESTMENT COMPANY 
                   STOCK IN DETERMINING GROSS ESTATE OF 
                   NONRESIDENTS.

       (a) In General.--Paragraph (3) of section 2105(d) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to estates of decedents dying after December 31, 
     2009.

                  PART II--LOW-INCOME HOUSING CREDITS

     SEC. 231. ELECTION FOR DIRECT PAYMENT OF LOW-INCOME HOUSING 
                   CREDIT FOR 2010.

       (a) In General.--Section 42 is amended by redesignating 
     subsection (n) as subsection (o) and by inserting after 
     subsection (m) the following new subsection:
       ``(n) Election for Direct Payment of Credit.--
       ``(1) In general.--The housing credit agency of each State 
     shall be allowed a credit in an amount equal to such State's 
     2010 low-income housing refundable credit election amount, 
     which shall be payable by the Secretary as provided in 
     paragraph (5).
       ``(2) 2010 low-income housing refundable credit election 
     amount.--For purposes of this subsection, the term `2010 low-
     income housing refundable credit election amount' means, with 
     respect to any State, such amount as the State may elect 
     which does not exceed 85 percent of the product of--
       ``(A) the sum of--
       ``(i) 100 percent of the State housing credit ceiling for 
     2010 which is attributable to amounts described in clauses 
     (i) and (iii) of subsection (h)(3)(C), and
       ``(ii) 40 percent of the State housing credit ceiling for 
     2010 which is attributable to amounts described in clauses 
     (ii) and (iv) of such subsection, multiplied by
       ``(B) 10.
       ``(3) Coordination with non-refundable credit.--For 
     purposes of this section, the

[[Page 10097]]

     amounts described in clauses (i) through (iv) of subsection 
     (h)(3)(C) with respect to any State for 2010 shall each be 
     reduced by so much of such amount as is taken into account in 
     determining the amount of the credit allowed with respect to 
     such State under paragraph (1).
       ``(4) Special rule for basis.--Basis of a qualified low-
     income building shall not be reduced by the amount of any 
     payment made under this subsection.
       ``(5) Payment of credit; use to finance low-income 
     buildings.--The Secretary shall pay to the housing credit 
     agency of each State an amount equal to the credit allowed 
     under paragraph (1). Rules similar to the rules of 
     subsections (c) and (d) of section 1602 of the American 
     Recovery and Reinvestment Tax Act of 2009 shall apply with 
     respect to any payment made under this paragraph, except that 
     such subsection (d) shall be applied by substituting `January 
     1, 2012' for `January 1, 2011'.''.
       (b) Conforming Amendment.--Section 1324(b)(2) of title 31, 
     United States Code, is amended by inserting ``42(n),'' after 
     ``36C,''.

                    Subtitle C--Business Tax Relief

     SEC. 241. RESEARCH CREDIT.

       (a) In General.--Subparagraph (B) of section 41(h)(1) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Conforming Amendment.--Subparagraph (D) of section 
     45C(b)(1) is amended by striking ``December 31, 2009'' and 
     inserting ``December 31, 2010''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred after December 31, 
     2009.

     SEC. 242. INDIAN EMPLOYMENT TAX CREDIT.

       (a) In General.--Subsection (f) of section 45A is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 243. NEW MARKETS TAX CREDIT.

       (a) In General.--Subparagraph (F) of section 45D(f)(1) is 
     amended by inserting ``and 2010'' after ``2009''.
       (b) Conforming Amendment.--Paragraph (3) of section 45D(f) 
     is amended by striking ``2014'' and inserting ``2015''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to calendar years beginning after 2009.

     SEC. 244. RAILROAD TRACK MAINTENANCE CREDIT.

       (a) In General.--Subsection (f) of section 45G is amended 
     by striking ``January 1, 2010'' and inserting ``January 1, 
     2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to expenditures paid or incurred in taxable years 
     beginning after December 31, 2009.

     SEC. 245. MINE RESCUE TEAM TRAINING CREDIT.

       (a) In General.--Subsection (e) of section 45N is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Credit Allowable Against AMT.--Subparagraph (B) of 
     section 38(c)(4), as amended by section 105, is amended--
       (1) by redesignating clauses (vii) through (x) as clauses 
     (viii) through (xi), respectively; and
       (2) by inserting after clause (vi) the following new 
     clause:
       ``(vii) the credit determined under section 45N,''.
       (c) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 2009.
       (2) Allowance against amt.--The amendments made by 
     subsection (b) shall apply to credits determined for taxable 
     years beginning after December 31, 2009, and to carrybacks of 
     such credits.

     SEC. 246. EMPLOYER WAGE CREDIT FOR EMPLOYEES WHO ARE ACTIVE 
                   DUTY MEMBERS OF THE UNIFORMED SERVICES.

       (a) In General.--Subsection (f) of section 45P is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to payments made after December 31, 2009.

     SEC. 247. 5-YEAR DEPRECIATION FOR FARMING BUSINESS MACHINERY 
                   AND EQUIPMENT.

       (a) In General.--Clause (vii) of section 168(e)(3)(B) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2009.

     SEC. 248. 15-YEAR STRAIGHT-LINE COST RECOVERY FOR QUALIFIED 
                   LEASEHOLD IMPROVEMENTS, QUALIFIED RESTAURANT 
                   BUILDINGS AND IMPROVEMENTS, AND QUALIFIED 
                   RETAIL IMPROVEMENTS.

       (a) In General.--Clauses (iv), (v), and (ix) of section 
     168(e)(3)(E) are each amended by striking ``January 1, 2010'' 
     and inserting ``January 1, 2011''.
       (b) Conforming Amendments.--
       (1) Clause (i) of section 168(e)(7)(A) is amended by 
     striking ``if such building is placed in service after 
     December 31, 2008, and before January 1, 2010,''.
       (2) Paragraph (8) of section 168(e) is amended by striking 
     subparagraph (E).
       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2009.

     SEC. 249. 7-YEAR RECOVERY PERIOD FOR MOTORSPORTS 
                   ENTERTAINMENT COMPLEXES.

       (a) In General.--Subparagraph (D) of section 168(i)(15) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2009.

     SEC. 250. ACCELERATED DEPRECIATION FOR BUSINESS PROPERTY ON 
                   AN INDIAN RESERVATION.

       (a) In General.--Paragraph (8) of section 168(j) is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2009.

     SEC. 251. ENHANCED CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF 
                   FOOD INVENTORY.

       (a) In General.--Clause (iv) of section 170(e)(3)(C) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to contributions made after December 31, 2009.

     SEC. 252. ENHANCED CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF 
                   BOOK INVENTORIES TO PUBLIC SCHOOLS.

       (a) In General.--Clause (iv) of section 170(e)(3)(D) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to contributions made after December 31, 2009.

     SEC. 253. ENHANCED CHARITABLE DEDUCTION FOR CORPORATE 
                   CONTRIBUTIONS OF COMPUTER INVENTORY FOR 
                   EDUCATIONAL PURPOSES.

       (a) In General.--Subparagraph (G) of section 170(e)(6) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to contributions made in taxable years beginning 
     after December 31, 2009.

     SEC. 254. ELECTION TO EXPENSE MINE SAFETY EQUIPMENT.

       (a) In General.--Subsection (g) of section 179E is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2009.

     SEC. 255. SPECIAL EXPENSING RULES FOR CERTAIN FILM AND 
                   TELEVISION PRODUCTIONS.

       (a) In General.--Subsection (f) of section 181 is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to productions commencing after December 31, 
     2009.

     SEC. 256. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS.

       (a) In General.--Subsection (h) of section 198 is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to expenditures paid or incurred after December 
     31, 2009.

     SEC. 257. DEDUCTION ALLOWABLE WITH RESPECT TO INCOME 
                   ATTRIBUTABLE TO DOMESTIC PRODUCTION ACTIVITIES 
                   IN PUERTO RICO.

       (a) In General.--Subparagraph (C) of section 199(d)(8) is 
     amended--
       (1) by striking ``first 4 taxable years'' and inserting 
     ``first 5 taxable years''; and
       (2) by striking ``January 1, 2010'' and inserting ``January 
     1, 2011''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 258. MODIFICATION OF TAX TREATMENT OF CERTAIN PAYMENTS 
                   TO CONTROLLING EXEMPT ORGANIZATIONS.

       (a) In General.--Clause (iv) of section 512(b)(13)(E) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to payments received or accrued after December 
     31, 2009.

     SEC. 259. EXCLUSION OF GAIN OR LOSS ON SALE OR EXCHANGE OF 
                   CERTAIN BROWNFIELD SITES FROM UNRELATED 
                   BUSINESS INCOME.

       (a) In General.--Subparagraph (K) of section 512(b)(19) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property acquired after December 31, 2009.

     SEC. 260. TIMBER REIT MODERNIZATION.

       (a) In General.--Paragraph (8) of section 856(c) is amended 
     by striking ``means'' and all that follows and inserting 
     ``means December 31, 2010.''.
       (b) Conforming Amendments.--
       (1) Subparagraph (I) of section 856(c)(2) is amended by 
     striking ``the first taxable year beginning after the date of 
     the enactment of this subparagraph'' and inserting ``a 
     taxable year beginning on or before the termination date''.
       (2) Clause (iii) of section 856(c)(5)(H) is amended by 
     inserting ``in taxable years beginning'' after 
     ``dispositions''.

[[Page 10098]]

       (3) Clause (v) of section 857(b)(6)(D) is amended by 
     inserting ``in a taxable year beginning'' after ``sale''.
       (4) Subparagraph (G) of section 857(b)(6) is amended by 
     inserting ``in a taxable year beginning'' after ``In the case 
     of a sale''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after May 22, 2009.

     SEC. 261. TREATMENT OF CERTAIN DIVIDENDS OF REGULATED 
                   INVESTMENT COMPANIES.

       (a) In General.--Paragraphs (1)(C) and (2)(C) of section 
     871(k) are each amended by striking ``December 31, 2009'' and 
     inserting ``December 31, 2010''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 262. RIC QUALIFIED INVESTMENT ENTITY TREATMENT UNDER 
                   FIRPTA.

       (a) In General.--Clause (ii) of section 897(h)(4)(A) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--
       (1) In general.--The amendment made by subsection (a) shall 
     take effect on January 1, 2010. Notwithstanding the preceding 
     sentence, such amendment shall not apply with respect to the 
     withholding requirement under section 1445 of the Internal 
     Revenue Code of 1986 for any payment made before the date of 
     the enactment of this Act.
       (2) Amounts withheld on or before date of enactment.--In 
     the case of a regulated investment company--
       (A) which makes a distribution after December 31, 2009, and 
     before the date of the enactment of this Act; and
       (B) which would (but for the second sentence of paragraph 
     (1)) have been required to withhold with respect to such 
     distribution under section 1445 of such Code,

     such investment company shall not be liable to any person to 
     whom such distribution was made for any amount so withheld 
     and paid over to the Secretary of the Treasury.

     SEC. 263. EXCEPTIONS FOR ACTIVE FINANCING INCOME.

       (a) In General.--Sections 953(e)(10) and 954(h)(9) are each 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Conforming Amendment.--Section 953(e)(10) is amended by 
     striking ``December 31, 2009'' and inserting ``December 31, 
     2010''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years of foreign corporations 
     beginning after December 31, 2009, and to taxable years of 
     United States shareholders with or within which any such 
     taxable year of such foreign corporation ends.

     SEC. 264. LOOK-THRU TREATMENT OF PAYMENTS BETWEEN RELATED 
                   CONTROLLED FOREIGN CORPORATIONS UNDER FOREIGN 
                   PERSONAL HOLDING COMPANY RULES.

       (a) In General.--Subparagraph (C) of section 954(c)(6) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years of foreign corporations 
     beginning after December 31, 2009, and to taxable years of 
     United States shareholders with or within which any such 
     taxable year of such foreign corporation ends.

     SEC. 265. BASIS ADJUSTMENT TO STOCK OF S CORPS MAKING 
                   CHARITABLE CONTRIBUTIONS OF PROPERTY.

       (a) In General.--Paragraph (2) of section 1367(a) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to contributions made in taxable years beginning 
     after December 31, 2009.

     SEC. 266. EMPOWERMENT ZONE TAX INCENTIVES.

       (a) In General.--Section 1391 is amended--
       (1) by striking ``December 31, 2009'' in subsection 
     (d)(1)(A)(i) and inserting ``December 31, 2010''; and
       (2) by striking the last sentence of subsection (h)(2).
       (b) Increased Exclusion of Gain on Stock of Empowerment 
     Zone Businesses.--Subparagraph (C) of section 1202(a)(2) is 
     amended--
       (1) by striking ``December 31, 2014'' and inserting 
     ``December 31, 2015''; and
       (2) by striking ``2014'' in the heading and inserting 
     ``2015''.
       (c) Treatment of Certain Termination Dates Specified in 
     Nominations.--In the case of a designation of an empowerment 
     zone the nomination for which included a termination date 
     which is contemporaneous with the date specified in 
     subparagraph (A)(i) of section 1391(d)(1) of the Internal 
     Revenue Code of 1986 (as in effect before the enactment of 
     this Act), subparagraph (B) of such section shall not apply 
     with respect to such designation unless, after the date of 
     the enactment of this section, the entity which made such 
     nomination reconfirms such termination date, or amends the 
     nomination to provide for a new termination date, in such 
     manner as the Secretary of the Treasury (or the Secretary's 
     designee) may provide.
       (d) Effective Date.--The amendments made by this section 
     shall apply to periods after December 31, 2009.

     SEC. 267. TAX INCENTIVES FOR INVESTMENT IN THE DISTRICT OF 
                   COLUMBIA.

       (a) In General.--Subsection (f) of section 1400 is amended 
     by striking ``December 31, 2009'' each place it appears and 
     inserting ``December 31, 2010''.
       (b) Tax-exempt DC Empowerment Zone Bonds.--Subsection (b) 
     of section 1400A is amended by striking ``December 31, 2009'' 
     and inserting ``December 31, 2010''.
       (c) Zero-percent Capital Gains Rate.--
       (1) Acquisition date.--Paragraphs (2)(A)(i), (3)(A), 
     (4)(A)(i), and (4)(B)(i)(I) of section 1400B(b) are each 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (2) Limitation on period of gains.--
       (A) In general.--Paragraph (2) of section 1400B(e) is 
     amended--
       (i) by striking ``December 31, 2014'' and inserting 
     ``December 31, 2015''; and
       (ii) by striking ``2014'' in the heading and inserting 
     ``2015''.
       (B) Partnerships and s-corps.--Paragraph (2) of section 
     1400B(g) is amended by striking ``December 31, 2014'' and 
     inserting ``December 31, 2015''.
       (d) First-time Homebuyer Credit.--Subsection (i) of section 
     1400C is amended by striking ``January 1, 2010'' and 
     inserting ``January 1, 2011''.
       (e) Effective Dates.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to periods after December 31, 2009.
       (2) Tax-exempt dc empowerment zone bonds.--The amendment 
     made by subsection (b) shall apply to bonds issued after 
     December 31, 2009.
       (3) Acquisition dates for zero-percent capital gains 
     rate.--The amendments made by subsection (c) shall apply to 
     property acquired or substantially improved after December 
     31, 2009.
       (4) Homebuyer credit.--The amendment made by subsection (d) 
     shall apply to homes purchased after December 31, 2009.

     SEC. 268. RENEWAL COMMUNITY TAX INCENTIVES.

       (a) In General.--Subsection (b) of section 1400E is 
     amended--
       (1) by striking ``December 31, 2009'' in paragraphs (1)(A) 
     and (3) and inserting ``December 31, 2010''; and
       (2) by striking ``January 1, 2010'' in paragraph (3) and 
     inserting ``January 1, 2011''.
       (b) Zero-percent Capital Gains Rate.--
       (1) Acquisition date.--Paragraphs (2)(A)(i), (3)(A), 
     (4)(A)(i), and (4)(B)(i) of section 1400F(b) are each amended 
     by striking ``January 1, 2010'' and inserting ``January 1, 
     2011''.
       (2) Limitation on period of gains.--Paragraph (2) of 
     section 1400F(c) is amended--
       (A) by striking ``December 31, 2014'' and inserting 
     ``December 31, 2015''; and
       (B) by striking ``2014'' in the heading and inserting 
     ``2015''.
       (3) Clerical amendment.--Subsection (d) of section 1400F is 
     amended by striking ``and `December 31, 2014' for `December 
     31, 2014'''.
       (c) Commercial Revitalization Deduction.--
       (1) In general.--Subsection (g) of section 1400I is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (2) Conforming amendment.--Subparagraph (A) of section 
     1400I(d)(2) is amended by striking ``after 2001 and before 
     2010'' and inserting ``which begins after 2001 and before the 
     date referred to in subsection (g)''.
       (d) Increased Expensing Under Section 179.--Subparagraph 
     (A) of section 1400J(b)(1) is amended by striking ``January 
     1, 2010'' and inserting ``January 1, 2011''.
       (e) Treatment of Certain Termination Dates Specified in 
     Nominations.--In the case of a designation of a renewal 
     community the nomination for which included a termination 
     date which is contemporaneous with the date specified in 
     subparagraph (A) of section 1400E(b)(1) of the Internal 
     Revenue Code of 1986 (as in effect before the enactment of 
     this Act), subparagraph (B) of such section shall not apply 
     with respect to such designation unless, after the date of 
     the enactment of this section, the entity which made such 
     nomination reconfirms such termination date, or amends the 
     nomination to provide for a new termination date, in such 
     manner as the Secretary of the Treasury (or the Secretary's 
     designee) may provide.
       (f) Effective Dates.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to periods after December 31, 2009.
       (2) Acquisitions.--The amendments made by subsections 
     (b)(1) and (d) shall apply to acquisitions after December 31, 
     2009.
       (3) Commercial revitalization deduction.--
       (A) In general.--The amendment made by subsection (c)(1) 
     shall apply to buildings placed in service after December 31, 
     2009.
       (B) Conforming amendment.--The amendment made by subsection 
     (c)(2) shall apply to calendar years beginning after December 
     31, 2009.

     SEC. 269. TEMPORARY INCREASE IN LIMIT ON COVER OVER OF RUM 
                   EXCISE TAXES TO PUERTO RICO AND THE VIRGIN 
                   ISLANDS.

       (a) In General.--Paragraph (1) of section 7652(f) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to distilled spirits brought into the United 
     States after December 31, 2009.

[[Page 10099]]



     SEC. 270. PAYMENT TO AMERICAN SAMOA IN LIEU OF EXTENSION OF 
                   ECONOMIC DEVELOPMENT CREDIT.

       The Secretary of the Treasury (or his designee) shall pay 
     $18,000,000 to the Government of American Samoa for purposes 
     of economic development. The payment made under the preceding 
     sentence shall be treated for purposes of section 1324 of 
     title 31, United States Code, as a refund of internal revenue 
     collections to which such section applies.

     SEC. 271. ELECTION TO TEMPORARILY UTILIZE UNUSED AMT CREDITS 
                   DETERMINED BY DOMESTIC INVESTMENT.

       (a) In General.--Section 53 is amended by adding at the end 
     the following new subsection:
       ``(g) Election for Corporations With New Domestic 
     Investments.--
       ``(1) In general.--If a corporation elects to have this 
     subsection apply for its first taxable year beginning after 
     December 31, 2009, the limitation imposed by subsection (c) 
     for such taxable year shall be increased by the AMT credit 
     adjustment amount.
       ``(2) AMT credit adjustment amount.--For purposes of 
     paragraph (1), the term `AMT credit adjustment amount' means, 
     the lesser of--
       ``(A) 50 percent of a corporation's minimum tax credit for 
     its first taxable year beginning after December 31, 2009, 
     determined under subsection (b), or
       ``(B) 10 percent of new domestic investments made during 
     such taxable year.
       ``(3) New domestic investments.--For purposes of this 
     subsection, the term `new domestic investments' means the 
     cost of qualified property (as defined in section 
     168(k)(2)(A)(i))--
       ``(A) the original use of which commences with the taxpayer 
     during the taxable year, and
       ``(B) which is placed in service in the United States by 
     the taxpayer during such taxable year.
       ``(4) Credit refundable.--For purposes of subsection (b) of 
     section 6401, the aggregate increase in the credits allowable 
     under this part for any taxable year resulting from the 
     application of this subsection shall be treated as allowed 
     under subpart C (and not under any other subpart). For 
     purposes of section 6425, any amount treated as so allowed 
     shall be treated as a payment of estimated income tax for the 
     taxable year.
       ``(5) Election.--An election under this subsection shall be 
     made at such time and in such manner as prescribed by the 
     Secretary, and once made, may be revoked only with the 
     consent of the Secretary. Not later than 90 days after the 
     date of the enactment of this subsection, the Secretary shall 
     issue guidance specifying such time and manner.
       ``(6) Treatment of certain partnership investments.--For 
     purposes of this subsection, a corporation shall take into 
     account its allocable share of any new domestic investments 
     by a partnership for any taxable year if, and only if, more 
     than 90 percent of the capital and profits interests in such 
     partnership are owned by such corporation (directly or 
     indirectly) at all times during such taxable year.
       ``(7) No double benefit.--
       ``(A) In general.--A corporation making an election under 
     this subsection may not make an election under subparagraph 
     (H) of section 172(b)(1).
       ``(B) Special rules with respect to taxpayers previously 
     electing applicable net operating losses.--In the case of a 
     corporation which made an election under subparagraph (H) of 
     section 172(b)(1) and elects the application of this 
     subsection--
       ``(i) Election of applicable net operating loss treated as 
     revoked.--The election under such subparagraph (H) shall 
     (notwithstanding clause (iii)(II) of such subparagraph) be 
     treated as having been revoked by the taxpayer.
       ``(ii) Coordination with provision for expedited refund.--
     The amount otherwise treated as a payment of estimated income 
     tax under the last sentence of paragraph (4) shall be reduced 
     (but not below zero) by the aggregate increase in unpaid tax 
     liability determined under this chapter by reason of the 
     revocation of the election under clause (i).
       ``(iii) Application of statute of limitations.--With 
     respect to the revocation of an election under clause (i)--

       ``(I) the statutory period for the assessment of any 
     deficiency attributable to such revocation shall not expire 
     before the end of the 3-year period beginning on the date of 
     the election to have this subsection apply, and
       ``(II) such deficiency may be assessed before the 
     expiration of such 3-year period notwithstanding the 
     provisions of any other law or rule of law which would 
     otherwise prevent such assessment.

       ``(C) Exception for eligible small businesses.--
     Subparagraphs (A) and (B) shall not apply to an eligible 
     small business as defined in section 172(b)(1)(H)(v)(II).
       ``(8) Regulations.--The Secretary may issue such 
     regulations or other guidance as may be necessary or 
     appropriate to carry out the purposes of this subsection, 
     including to prevent fraud and abuse under this 
     subsection.''.
       (b) Conforming Amendments.--
       (1) Section 6211(b)(4)(A) is amended by inserting 
     ``53(g),'' after ``53(e),''.
       (2) Section 1324(b)(2) of title 31, United States Code, is 
     amended by inserting ``53(g),'' after ``53(e),''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 272. STUDY OF EXTENDED TAX EXPENDITURES.

       (a) Findings.--Congress finds the following:
       (1) Currently, the aggregate cost of Federal tax 
     expenditures rivals, or even exceeds, the amount of total 
     Federal discretionary spending.
       (2) Given the escalating public debt, a critical 
     examination of this use of taxpayer dollars is essential.
       (3) Additionally, tax expenditures can complicate the 
     Internal Revenue Code of 1986 for taxpayers and complicate 
     tax administration for the Internal Revenue Service.
       (4) To facilitate a better understanding of tax 
     expenditures in the future, it is constructive for 
     legislation extending these provisions to include a study of 
     such provisions.
       (b) Requirement to Report.--Not later than November 30, 
     2010, the Chief of Staff of the Joint Committee on Taxation, 
     in consultation with the Comptroller General of the United 
     States, shall submit to the Committee on Ways and Means of 
     the House of Representatives and the Committee on Finance of 
     the Senate a report on each tax expenditure (as defined in 
     section 3(3) of the Congressional Budget Impoundment Control 
     Act of 1974 (2 U.S.C. 622(3)) extended by this title.
       (c) Rolling Submission of Reports.--The Chief of Staff of 
     the Joint Committee on Taxation shall initially submit the 
     reports for each such tax expenditure enacted in this 
     subtitle (relating to business tax relief) and subtitle A 
     (relating to energy) in order of the tax expenditure 
     incurring the least aggregate cost to the greatest aggregate 
     cost (determined by reference to the cost estimate of this 
     Act by the Joint Committee on Taxation). Thereafter, such 
     reports may be submitted in such order as the Chief of Staff 
     determines appropriate.
       (d) Contents of Report.--Such reports shall contain the 
     following:
       (1) An explanation of the tax expenditure and any relevant 
     economic, social, or other context under which it was first 
     enacted.
       (2) A description of the intended purpose of the tax 
     expenditure.
       (3) An analysis of the overall success of the tax 
     expenditure in achieving such purpose, and evidence 
     supporting such analysis.
       (4) An analysis of the extent to which further extending 
     the tax expenditure, or making it permanent, would contribute 
     to achieving such purpose.
       (5) A description of the direct and indirect beneficiaries 
     of the tax expenditure, including identifying any unintended 
     beneficiaries.
       (6) An analysis of whether the tax expenditure is the most 
     cost-effective method for achieving the purpose for which it 
     was intended, and a description of any more cost-effective 
     methods through which such purpose could be accomplished.
       (7) A description of any unintended effects of the tax 
     expenditure that are useful in understanding the tax 
     expenditure's overall value.
       (8) An analysis of how the tax expenditure could be 
     modified to better achieve its original purpose.
       (9) A brief description of any interactions (actual or 
     potential) with other tax expenditures or direct spending 
     programs in the same or related budget function worthy of 
     further study.
       (10) A description of any unavailable information the staff 
     of the Joint Committee on Taxation may need to complete a 
     more thorough examination and analysis of the tax 
     expenditure, and what must be done to make such information 
     available.
       (e) Minimum Analysis by Deadline.--In the event the Chief 
     of Staff of the Joint Committee on Taxation concludes it will 
     not be feasible to complete all reports by the date specified 
     in subsection (a), at a minimum, the reports for each tax 
     expenditure enacted in this subtitle (relating to business 
     tax relief) and subtitle A (relating to energy) shall be 
     completed by such date.

            Subtitle D--Temporary Disaster Relief Provisions

                    PART I--NATIONAL DISASTER RELIEF

     SEC. 281. WAIVER OF CERTAIN MORTGAGE REVENUE BOND 
                   REQUIREMENTS.

       (a) In General.--Paragraph (11) of section 143(k) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Special Rule for Residences Destroyed in Federally 
     Declared Disasters.--Paragraph (13) of section 143(k), as 
     redesignated by subsection (c), is amended by striking 
     ``January 1, 2010'' in subparagraphs (A)(i) and (B)(i) and 
     inserting ``January 1, 2011''.
       (c) Technical Amendment.--Subsection (k) of section 143 is 
     amended by redesignating the second paragraph (12) (relating 
     to special rules for residences destroyed in federally 
     declared disasters) as paragraph (13).
       (d) Effective Dates.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendment made by this section shall apply to 
     bonds issued after December 31, 2009.
       (2) Residences destroyed in federally declared disasters.--
     The amendments

[[Page 10100]]

     made by subsection (b) shall apply with respect to disasters 
     occurring after December 31, 2009.
       (3) Technical amendment.--The amendment made by subsection 
     (c) shall take effect as if included in section 709 of the 
     Tax Extenders and Alternative Minimum Tax Relief Act of 2008.

     SEC. 282. LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED 
                   DISASTERS.

       (a) In General.--Subclause (I) of section 165(h)(3)(B)(i) 
     is amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) $500 Limitation.--Paragraph (1) of section 165(h) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (c) Effective Date.--
       (1) In general.--The amendment made by subsection (a) shall 
     apply to federally declared disasters occurring after 
     December 31, 2009.
       (2) $500 limitation.--The amendment made by subsection (b) 
     shall apply to taxable years beginning after December 31, 
     2009.

     SEC. 283. SPECIAL DEPRECIATION ALLOWANCE FOR QUALIFIED 
                   DISASTER PROPERTY.

       (a) In General.--Subclause (I) of section 168(n)(2)(A)(ii) 
     is amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to disasters occurring after December 31, 2009.

     SEC. 284. NET OPERATING LOSSES ATTRIBUTABLE TO FEDERALLY 
                   DECLARED DISASTERS.

       (a) In General.--Subclause (I) of section 172(j)(1)(A)(i) 
     is amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to losses attributable to disasters occurring 
     after December 31, 2009.

     SEC. 285. EXPENSING OF QUALIFIED DISASTER EXPENSES.

       (a) In General.--Subparagraph (A) of section 198A(b)(2) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to expenditures on account of disasters occurring 
     after December 31, 2009.

                      PART II--REGIONAL PROVISIONS

                    Subpart A--New York Liberty Zone

     SEC. 291. SPECIAL DEPRECIATION ALLOWANCE FOR NONRESIDENTIAL 
                   AND RESIDENTIAL REAL PROPERTY.

       (a) In General.--Subparagraph (A) of section 1400L(b)(2) is 
     amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2009.

     SEC. 292. TAX-EXEMPT BOND FINANCING.

       (a) In General.--Subparagraph (D) of section 1400L(d)(2) is 
     amended by striking ``January 1, 2010'' and inserting 
     ``January 1, 2011''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to bonds issued after December 31, 2009.

                           Subpart B--GO Zone

     SEC. 295. INCREASE IN REHABILITATION CREDIT.

       (a) In General.--Subsection (h) of section 1400N is amended 
     by striking ``December 31, 2009'' and inserting ``December 
     31, 2010''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to amounts paid or incurred after December 31, 
     2009.

     SEC. 296. WORK OPPORTUNITY TAX CREDIT WITH RESPECT TO CERTAIN 
                   INDIVIDUALS AFFECTED BY HURRICANE KATRINA FOR 
                   EMPLOYERS INSIDE DISASTER AREAS.

       (a) In General.--Paragraph (1) of section 201(b) of the 
     Katrina Emergency Tax Relief Act of 2005 is amended by 
     striking ``4-year'' and inserting ``5-year''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to individuals hired after August 27, 2009.

     SEC. 297. EXTENSION OF LOW-INCOME HOUSING CREDIT RULES FOR 
                   BUILDINGS IN GO ZONES.

       Section 1400N(c)(5) is amended by striking ``January 1, 
     2011'' and inserting ``January 1, 2013''.

                   TITLE III--PENSION FUNDING RELIEF

                   Subtitle A--Single-Employer Plans

     SEC. 301. EXTENDED PERIOD FOR SINGLE-EMPLOYER DEFINED BENEFIT 
                   PLANS TO AMORTIZE CERTAIN SHORTFALL 
                   AMORTIZATION BASES.

       (a) ERISA Amendments.--
       (1) In general.--Section 303(c)(2) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1083(c)(2)) 
     is amended by adding at the end the following subparagraphs:
       ``(D) Special rule.--
       ``(i) In general.--In the case of the shortfall 
     amortization base of a plan for any applicable plan year, the 
     shortfall amortization installments are the amounts described 
     in clause (ii) or (iii), if made applicable by an election 
     under clause (iv). In the absence of a timely election, such 
     installments shall be determined without regard to this 
     subparagraph.
       ``(ii) 2 plus 7 amortization schedule.--The shortfall 
     amortization installments described in this clause are--

       ``(I) in the case of the first 2 plan years in the 9-plan-
     year period beginning with the applicable plan year, interest 
     on the shortfall amortization base (determined by using the 
     effective interest rate for the applicable plan year), and
       ``(II) in the case of the last 7 plan years in such 9-plan-
     year period, the amounts necessary to amortize the balance of 
     such shortfall amortization base in level annual installments 
     over such last 7 plan years (determined using the segment 
     rates determined under subparagraph (C) of subsection (h)(2) 
     for the applicable plan year, applied under rules similar to 
     the rules of subparagraph (B) of subsection (h)(2)).

       ``(iii) 15-year amortization.--The shortfall amortization 
     installments described in this clause are the amounts under 
     subparagraphs (A) and (B) determined by substituting `15 
     plan-year period' for `7-plan-year period'.
       ``(iv) Election.--

       ``(I) In general.--The plan sponsor may, with respect to a 
     plan, elect, with respect to any of not more than 2 
     applicable plan years, to determine shortfall amortization 
     installments under this subparagraph. An election under 
     either clause (ii) or clause (iii) may be made with respect 
     to either of such applicable plan years.
       ``(II) Eligibility for election.--An election may be made 
     to determine shortfall amortization installments under this 
     subparagraph with respect to a plan only if, as of the date 
     of the election--

       ``(aa) the plan sponsor is not a debtor in a case under 
     title 11, United States Code, or similar Federal or State 
     law,
       ``(bb) there are no unpaid minimum required contributions 
     with respect to the plan for purposes of section 4971 of the 
     Internal Revenue Code of 1986,
       ``(cc) there is no lien in favor of the plan under 
     subsection (k) or under section 430(k) of such Code, and
       ``(dd) a distress termination has not been initiated for 
     the plan under section 4041(c).

       ``(III) Rules relating to election.--Such election shall be 
     made at such times, and in such form and manner, as shall be 
     prescribed by the Secretary of the Treasury and shall be 
     irrevocable, except under such limited circumstances, and 
     subject to such conditions, as such Secretary may prescribe.

       ``(E) Applicable plan year.--
       ``(i) In general.--For purposes of this paragraph, the term 
     `applicable plan year' means, subject to the election of the 
     plan sponsor under subparagraph (D)(iv), each of not more 
     than 2 of the plan years beginning in 2008, 2009, 2010, or 
     2011.
       ``(ii) Special rule relating to 2008.--A plan year may be 
     elected as an applicable plan year pursuant to this 
     subparagraph only if the due date under subsection (j)(1) for 
     the payment of the minimum required contribution for such 
     plan year occurs on or after March 10, 2010.
       ``(F) Increases in shortfall amortization installments in 
     cases of excess compensation or certain dividends or stock 
     redemptions.--
       ``(i) In general.--If, with respect to an election for an 
     applicable plan year under subparagraph (D), there is an 
     installment acceleration amount with respect to a plan for 
     any plan year in the restriction period (or if there is an 
     installment acceleration amount carried forward to a plan 
     year not in the restriction period), then the shortfall 
     amortization installment otherwise determined and payable 
     under this paragraph for such plan year shall be increased by 
     such amount.
       ``(ii) Back-end adjustment to amortization schedule.--
     Subject to rules prescribed by the Secretary of the Treasury, 
     if a shortfall amortization installment with respect to any 
     shortfall amortization base for an applicable plan year is 
     required to be increased for any plan year under clause (i), 
     subsequent shortfall amortization installments with respect 
     to such base shall be reduced, in reverse order of the 
     otherwise required installments beginning with the final 
     scheduled installment, to the extent necessary to limit the 
     present value of such subsequent shortfall amortization 
     installments (after application of this subparagraph) to the 
     present value of the remaining unamortized shortfall 
     amortization base.
       ``(iii) Installment acceleration amount.--For purposes of 
     this subparagraph--

       ``(I) In general.--The term `installment acceleration 
     amount' means, with respect to any plan year in a restriction 
     period with respect to an applicable plan year, the sum of--

       ``(aa) the aggregate amount of excess employee compensation 
     determined under clause (iv) for the plan year, plus
       ``(bb) the dividend and redemption amount determined under 
     clause (v) for the plan year.

       ``(II) Cumulative limitation.--The installment acceleration 
     amount for any plan year shall not exceed the excess (if any) 
     of--

       ``(aa) the sum of the shortfall amortization installments 
     for the plan year and all preceding plan years in the 
     amortization period elected under subparagraph (D) with 
     respect to the shortfall amortization base with respect to an 
     applicable year, determined without regard to subparagraph 
     (D) and this subparagraph, over
       ``(bb) the sum of the shortfall amortization installments 
     for such plan year and all such

[[Page 10101]]

     preceding plan years, determined after application of 
     subparagraph (D) (and in the case of any preceding plan year, 
     after application of this subparagraph).

       ``(III) Carryover of excess installment acceleration 
     amounts.--

       ``(aa) In general.--If the installment acceleration amount 
     for any plan year (determined without regard to subclause 
     (II)) exceeds the limitation under subclause (II), then, 
     subject to item (bb), such excess shall be treated as an 
     installment acceleration amount for the succeeding plan year.
       ``(bb) Cap to apply.--If any amount treated as an 
     installment acceleration amount under item (aa) or this item 
     with respect any succeeding plan year, when added to other 
     installment acceleration amounts (determined without regard 
     to subclause (II)) with respect to the plan year, exceeds the 
     limitation under subclause (II), the portion of such amount 
     representing such excess shall be treated as an installment 
     acceleration amount with respect to the next succeeding plan 
     year.
       ``(cc) Limitation on years to which amounts carried 
     forward.--No amount shall be carried forward under item (aa) 
     or (bb) to a plan year which begins after the last plan year 
     in the restriction period (or after the second plan year 
     following such last plan year in the case of an election year 
     with respect to which 15-year amortization was elected under 
     subparagraph (D)(iii)).
       ``(dd) Ordering rules.--For purposes of applying item (bb), 
     installment acceleration amounts for the plan year 
     (determined without regard to any carryover under this 
     clause) shall be applied first against the limitation under 
     subclause (II) and then carryovers to such plan year shall be 
     applied against such limitation on a first-in, first-out 
     basis.
       ``(iv) Excess employee compensation.--

       ``(I) In general.--For purposes of this paragraph, the term 
     `excess employee compensation' means the sum of--

       ``(aa) with respect to any employee, for any plan year, the 
     excess (if any) of--
       ``(AA) the aggregate amount includible in income under 
     chapter 1 of the Internal Revenue Code of 1986 for 
     remuneration during the calendar year in which such plan year 
     begins for services performed by the employee for the plan 
     sponsor (whether or not performed during such calendar year), 
     over
       ``(BB) $1,000,000, plus
       ``(bb) the amount of assets set aside or reserved (directly 
     or indirectly) in a trust (or other arrangement as determined 
     by the Secretary of the Treasury), or transferred to such a 
     trust or other arrangement, during the calendar year by a 
     plan sponsor for purposes of paying deferred compensation of 
     an employee under a nonqualified deferred compensation plan 
     (as defined in section 409A of such Code) of the plan 
     sponsor.

       ``(II) No double counting.--No amount shall be taken into 
     account under subclause (I) more than once.
       ``(III) Employee; remuneration.--For purposes of this 
     clause, the term `employee' includes, with respect to a 
     calendar year, a self-employed individual who is treated as 
     an employee under section 401(c) of the Internal Revenue Code 
     of 1986 for the taxable year ending during such calendar 
     year, and the term `remuneration' shall include earned income 
     of such an individual.
       ``(IV) Certain payments under existing contracts.--There 
     shall not be taken into account under subclause (I)(aa) any 
     remuneration consisting of nonqualified deferred 
     compensation, restricted stock (or restricted stock units), 
     stock options, or stock appreciation rights payable or 
     granted under a written binding contract that was in effect 
     on March 1, 2010, and which was not modified in any material 
     respect before such remuneration is paid.
       ``(V) Only remuneration for post-2009 services counted.--
     Remuneration shall be taken into account under subclause 
     (I)(aa) only to the extent attributable to services performed 
     by the employee for the plan sponsor after December 31, 2009.
       ``(VI) Commissions.--

       ``(aa) In general.--There shall not be taken into account 
     under subclause (I)(aa) any remuneration payable on a 
     commission basis solely on account of income directly 
     generated by the individual performance of the individual to 
     whom such remuneration is payable.
       ``(bb) Specified employees.--Item (aa) shall not apply in 
     the case of any specified employee (within the meaning of 
     section 409A(a)(2)(B)(i) of the Internal Revenue Code of 
     1986) or any employee who would be such a specified employee 
     if the plan sponsor were a corporation described in such 
     section.

       ``(VII) Indexing of amount.--In the case of any calendar 
     year beginning after 2010, the dollar amount under subclause 
     (I)(aa)(BB) shall be increased by an amount equal to--

       ``(aa) such dollar amount, multiplied by
       ``(bb) the cost-of-living adjustment determined under 
     section 1(f)(3) of the Internal Revenue Code of 1986 for the 
     calendar year, determined by substituting `calendar year 
     2009' for `calendar year 1992' in subparagraph (B) thereof.

     If the amount of any increase under clause (i) is not a 
     multiple of $20,000, such increase shall be rounded to the 
     next lowest multiple of $20,000.

       ``(v) Certain dividends and redemptions.--

       ``(I) In general.--The dividend and redemption amount 
     determined under this clause for any plan year is the lesser 
     of--

       ``(aa) the excess of--
       ``(AA) the sum of the dividends paid during the plan year 
     by the plan sponsor, plus the amounts paid for the redemption 
     of stock of the plan sponsor redeemed during the plan year, 
     over
       ``(BB) an amount equal to the average of adjusted annual 
     net income of the plan sponsor for the last 5 fiscal years of 
     the plan sponsor ending before such plan year, or
       ``(bb) the sum of--
       ``(AA) the amounts paid for the redemption of stock of the 
     plan sponsor redeemed during the plan year, plus
       ``(BB) the excess of dividends paid during the plan year by 
     the plan sponsor over the dividend base amount.

       ``(II) Definitions.--

       ``(aa) Adjusted annual net income.--For purposes of 
     subclause (I)(aa)(BB), the term `adjusted annual net income' 
     with respect to any fiscal year means annual net income, 
     determined in accordance with generally accepted accounting 
     principles (before after-tax gain or loss on any sale of 
     assets), but without regard to any reduction by reason of 
     depreciation or amortization, except that in no event shall 
     adjusted annual net income for any fiscal year be less than 
     zero.
       ``(bb) Dividend base amount.--For purposes of this clause, 
     the term `dividend base amount' means, with respect to a plan 
     year, an amount equal to the greater of--
       ``(AA) the median of the amounts of the dividends paid 
     during each of the last 5 fiscal years of the plan sponsor 
     ending before such plan year, or
       ``(BB) the amount of dividends paid during such plan year 
     on preferred stock that was issued on or before May 21, 2010, 
     or that is replacement stock for such preferred stock.

       ``(III) Only certain post-2009 dividends and redemptions 
     counted.--For purposes of subclause (I) (other than for 
     purposes of calculating the dividend base amount), there 
     shall only be taken into account dividends declared, and 
     redemptions occurring, after February 28, 2010.
       ``(IV) Exception for intra-group dividends.--Dividends paid 
     by one member of a controlled group (as defined in section 
     302(d)(3)) to another member of such group shall not be taken 
     into account under subclause (I).
       ``(V) Exception for stock dividends.--Any distribution by 
     the plan sponsor to its shareholders of stock issued by the 
     plan sponsor shall not be taken into account under subclause 
     (I).
       ``(VI) Exception for certain redemptions.--The following 
     shall not be taken into account under subclause (I):

       ``(aa) Redemptions of securities which, at the time of 
     redemption, are not listed on an established securities 
     market and--
       ``(AA) are made pursuant to a pension plan that is 
     qualified under section 401 of the Internal Revenue Code of 
     1986 or a shareholder-approved program, or
       ``(BB) are made on account of an employee's termination of 
     employment with the plan sponsor, or the death or disability 
     of a shareholder.
       ``(bb) Redemptions of securities which are not, immediately 
     after issuance, listed on an established securities market 
     and are, or had previously been--
       ``(AA) held, directly or indirectly, by, or for the benefit 
     of, the Federal Government or a Federal reserve bank, or
       ``(BB) held by a national government (or a government-
     related entity of such a government) or an employee benefit 
     plan if such shares are substantially identical to shares 
     described in subitem (AA).
       ``(vi) Other definitions and rules.--For purposes of this 
     subparagraph--

       ``(I) Plan sponsor.--The term `plan sponsor' includes any 
     member of the plan sponsor's controlled group (as defined in 
     section 302(d)(3)).
       ``(II) Restriction period.--The term `restriction period' 
     means, with respect to any applicable plan year with respect 
     to which an election is made under subparagraph (D)--

       ``(aa) except as provided in item (bb), the 3-year period 
     beginning with the applicable plan year (or, if later, the 
     first plan year beginning after December 31, 2009), or
       ``(bb) if the plan sponsor elects 15-year amortization for 
     the shortfall amortization base for the applicable plan year, 
     the 5-year period beginning with such plan year (or, if 
     later, the first plan year beginning after December 31, 
     2009).

       ``(III) Elections for multiple plans.--If a plan sponsor 
     makes elections under subparagraph (D) with respect to 2 or 
     more plans, the Secretary of the Treasury shall provide rules 
     for the application of this subparagraph to such plans, 
     including rules for the ratable allocation of any installment 
     acceleration amount among such plans on the basis of each 
     plan's relative reduction in the plan's shortfall 
     amortization installment for the first plan year in the 
     amortization period described in clause (i) (determined 
     without regard to this subparagraph).

       ``(G) Mergers and acquisitions.--The Secretary of the 
     Treasury shall prescribe rules for the application of 
     subparagraphs (D) and

[[Page 10102]]

     (F) in any case where there is a merger or acquisition 
     involving a plan sponsor making the election under 
     subparagraph (D).
       ``(H) Regulations and guidance.--The Secretary of the 
     Treasury may prescribe such regulations and other guidance of 
     general applicability as such Secretary may determine 
     necessary to achieve the purposes of subparagraphs (D) and 
     (F).''.
       (2) Notice requirement.--Section 204 of such Act (29 U.S.C. 
     1054) is amended--
       (A) by redesignating subsection (k) as subsection (l); and
       (B) by inserting after subsection (j) the following new 
     subsection:
       ``(k) Notice in Connection With Shortfall Amortization 
     Election.--
       ``(1) In general.--Not later 30 days after the date of an 
     election under clause (iv) of section 303(c)(2)(D) in 
     connection with a single-employer plan, the plan 
     administrator shall provide notice of such election in 
     accordance with this subsection to each plan participant and 
     beneficiary, each labor organization representing such 
     participants and beneficiaries, and the Pension Benefit 
     Guaranty Corporation.
       ``(2) Matters included in notice.--Each notice provided 
     pursuant to this subsection shall set forth--
       ``(A) a statement that recently enacted legislation permits 
     employers to delay pension funding;
       ``(B) with respect to required contributions--
       ``(i) the amount of contributions that would have been 
     required had the election not been made;
       ``(ii) the amount of the reduction in required 
     contributions for the applicable plan year that occurs on 
     account of the election; and
       ``(iii) the number of plan years to which such reduction 
     will apply;
       ``(C) with respect to a plan's funding status as of the end 
     of the plan year preceding the applicable plan year--
       ``(i) the liabilities determined under section 
     4010(d)(1)(A); and
       ``(ii) the market value of assets of the plan; and
       ``(D) with respect to installment acceleration amounts (as 
     defined in section 303(c)(2)(F)(iii)(I))--
       ``(i) an explanation of section 303(c)(2)(F) (relating to 
     increases in shortfall amortization installments in cases of 
     excess compensation or certain dividends or stock 
     redemptions); and
       ``(ii) a statement that increases in required contributions 
     may occur in the event of future payments of excess employee 
     compensation or certain share repurchasing or dividend 
     activity and that subsequent notices of any such payments or 
     activity will be provided in the annual funding notice 
     provided pursuant to section 101(f).
       ``(3) Other requirements.--
       ``(A) Form.--The notice required by paragraph (1) shall be 
     written in a manner calculated to be understood by the 
     average plan participant. The Secretary of the Treasury shall 
     prescribe a model notice that a plan administrator may use to 
     satisfy the requirements of paragraph (1).
       ``(B) Provision to designated persons.--Any notice under 
     paragraph (1) may be provided to a person designated, in 
     writing, by the person to which it would otherwise be 
     provided.
       ``(4) Effect of egregious failure.--
       ``(A) In general.--In the case of any egregious failure to 
     meet any requirement of this subsection with respect to any 
     election, such election shall be treated as having not been 
     made.
       ``(B) Egregious failure.--For purposes of subparagraph (A), 
     there is an egregious failure to meet the requirements of 
     this subsection if such failure is in the control of the plan 
     sponsor and is--
       ``(i) an intentional failure (including any failure to 
     promptly provide the required notice or information after the 
     plan administrator discovers an unintentional failure to meet 
     the requirements of this subsection),
       ``(ii) a failure to provide most of the participants and 
     beneficiaries with most of the information they are entitled 
     to receive under this subsection, or
       ``(iii) a failure which is determined to be egregious under 
     regulations prescribed by the Secretary of the Treasury.
       ``(5) Use of new technologies.--The Secretary of the 
     Treasury may, in consultation with the Secretary, by 
     regulations or other guidance of general applicability, allow 
     any notice under this subsection to be provided using new 
     technologies.''.
       (C) Subsequent supplemental notices.--Section 101(f)(2)(C) 
     of such Act (29 U.S.C. 1021(f)(2)(C)) is amended--
       (i) by striking ``and'' at the end of clause (i);
       (ii) by redesignating clause (ii) as clause (iii); and
       (iii) by inserting after clause (i) the following new 
     clause:
       ``(ii) any excess employee compensation amounts and any 
     dividends and redemptions amounts determined under section 
     303(c)(2)(F) for the preceding plan year with respect to the 
     plan, and''.
       (3) Disregard of installment acceleration amounts in 
     determining quarterly contributions.--Section 303(j)(3) of 
     such Act (29 U.S.C. 1083(j)(3)) is amended by adding at the 
     end the following new subparagraph:
       ``(F) Disregard of installment acceleration amounts.--
     Subparagraph (D) shall be applied without regard to any 
     increase under subsection (c)(2)(F).''.
       (4) Conforming amendment.--Section 303(c)(1) of such Act 
     (29 U.S.C. 1083(c)(1)) is amended by striking ``the shortfall 
     amortization bases for such plan year and each of the 6 
     preceding plan years'' and inserting ``any shortfall 
     amortization base which has not been fully amortized under 
     this subsection''.
       (b) IRC Amendments.--
       (1) In general.--Section 430(c)(2) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     subparagraphs:
       ``(D) Special rule.--
       ``(i) In general.--In the case of the shortfall 
     amortization base of a plan for any applicable plan year, the 
     shortfall amortization installments are the amounts described 
     in clause (ii) or (iii), if made applicable by an election 
     under clause (iv). In the absence of a timely election, such 
     installments shall be determined without regard to this 
     subparagraph.
       ``(ii) 2 plus 7 amortization schedule.--The shortfall 
     amortization installments described in this clause are--

       ``(I) in the case of the first 2 plan years in the 9-plan-
     year period beginning with the applicable plan year, interest 
     on the shortfall amortization base (determined by using the 
     effective interest rate for the applicable plan year), and
       ``(II) in the case of the last 7 plan years in such 9-plan-
     year period, the amounts necessary to amortize the balance of 
     such shortfall amortization base in level annual installments 
     over such last 7 plan years (determined using the segment 
     rates determined under subparagraph (C) of subsection (h)(2) 
     for the applicable plan year, applied under rules similar to 
     the rules of subparagraph (B) of subsection (h)(2)).

       ``(iii) 15-year amortization.--The shortfall amortization 
     installments described in this clause are the amounts under 
     subparagraphs (A) and (B) determined by substituting `15 
     plan-year period' for `7-plan-year period'.
       ``(iv) Election.--

       ``(I) In general.--The plan sponsor may, with respect to a 
     plan, elect, with respect to any of not more than 2 
     applicable plan years, to determine shortfall amortization 
     installments under this subparagraph. An election under 
     either clause (ii) or clause (iii) may be made with respect 
     to either of such applicable plan years.
       ``(II) Eligibility for election.--An election may be made 
     to determine shortfall amortization installments under this 
     subparagraph with respect to a plan only if, as of the date 
     of the election--

       ``(aa) the plan sponsor is not a debtor in a case under 
     title 11, United States Code, or similar Federal or State 
     law,
       ``(bb) there are no unpaid minimum required contributions 
     with respect to the plan for purposes of section 4971,
       ``(cc) there is no lien in favor of the plan under 
     subsection (k) or under section 303(k) of the Employee 
     Retirement Income Security Act of 1974, and
       ``(dd) a distress termination has not been initiated for 
     the plan under section 4041(c) of such Act.

       ``(III) Rules relating to election.--Such election shall be 
     made at such times, and in such form and manner, as shall be 
     prescribed by the Secretary and shall be irrevocable, except 
     under such limited circumstances, and subject to such 
     conditions, as the Secretary may prescribe.

       ``(E) Applicable plan year.--
       ``(i) In general.--For purposes of this paragraph, the term 
     `applicable plan year' means, subject to the election of the 
     plan sponsor under subparagraph (D)(iv), each of not more 
     than 2 of the plan years beginning in 2008, 2009, 2010, or 
     2011.
       ``(ii) Special rule relating to 2008.--A plan year may be 
     elected as an applicable plan year pursuant to this 
     subparagraph only if the due date under subsection (j)(1) for 
     the payment of the minimum required contribution for such 
     plan year occurs on or after March 10, 2010.
       ``(F) Increases in shortfall amortization installments in 
     cases of excess compensation or certain dividends or stock 
     redemptions.--
       ``(i) In general.--If, with respect to an election for an 
     applicable plan year under subparagraph (D), there is an 
     installment acceleration amount with respect to a plan for 
     any plan year in the restriction period (or if there is an 
     installment acceleration amount carried forward to a plan 
     year not in the restriction period), then the shortfall 
     amortization installment otherwise determined and payable 
     under this paragraph for such plan year shall be increased by 
     such amount.
       ``(ii) Back-end adjustment to amortization schedule.--
     Subject to rules prescribed by the Secretary, if a shortfall 
     amortization installment with respect to any shortfall 
     amortization base for an applicable plan year is required to 
     be increased for any plan year under clause (i), subsequent 
     shortfall amortization installments with respect to such base 
     shall be reduced, in reverse order of the otherwise required 
     installments beginning with the final scheduled installment, 
     to

[[Page 10103]]

     the extent necessary to limit the present value of such 
     subsequent shortfall amortization installments (after 
     application of this subparagraph) to the present value of the 
     remaining unamortized shortfall amortization base.
       ``(iii) Installment acceleration amount.--For purposes of 
     this subparagraph--

       ``(I) In general.--The term `installment acceleration 
     amount' means, with respect to any plan year in a restriction 
     period with respect to an applicable plan year, the sum of--

       ``(aa) the aggregate amount of excess employee compensation 
     determined under clause (iv) for the plan year, plus
       ``(bb) the dividend and redemption amount determined under 
     clause (v) for the plan year.

       ``(II) Cumulative limitation.--The installment acceleration 
     amount for any plan year shall not exceed the excess (if any) 
     of--

       ``(aa) the sum of the shortfall amortization installments 
     for the plan year and all preceding plan years in the 
     amortization period elected under subparagraph (D) with 
     respect to the shortfall amortization base with respect to an 
     applicable year, determined without regard to subparagraph 
     (D) and this subparagraph, over
       ``(bb) the sum of the shortfall amortization installments 
     for such plan year and all such preceding plan years, 
     determined after application of subparagraph (D) (and in the 
     case of any preceding plan year, after application of this 
     subparagraph).

       ``(III) Carryover of excess installment acceleration 
     amounts.--

       ``(aa) In general.--If the installment acceleration amount 
     for any plan year (determined without regard to subclause 
     (II)) exceeds the limitation under subclause (II), then, 
     subject to item (bb), such excess shall be treated as an 
     installment acceleration amount for the succeeding plan year.
       ``(bb) Cap to apply.--If any amount treated as an 
     installment acceleration amount under item (aa) or this item 
     with respect any succeeding plan year, when added to other 
     installment acceleration amounts (determined without regard 
     to subclause (II)) with respect to the plan year, exceeds the 
     limitation under subclause (II), the portion of such amount 
     representing such excess shall be treated as an installment 
     acceleration amount with respect to the next succeeding plan 
     year.
       ``(cc) Limitation on years to which amounts carried 
     forward.--No amount shall be carried forward under item (aa) 
     or (bb) to a plan year which begins after the last plan year 
     in the restriction period (or after the second plan year 
     following such last plan year in the case of an election year 
     with respect to which 15-year amortization was elected under 
     subparagraph (D)(iii)).
       ``(dd) Ordering rules.--For purposes of applying item (bb), 
     installment acceleration amounts for the plan year 
     (determined without regard to any carryover under this 
     clause) shall be applied first against the limitation under 
     subclause (II) and then carryovers to such plan year shall be 
     applied against such limitation on a first-in, first-out 
     basis.
       ``(iv) Excess employee compensation.--

       ``(I) In general.--For purposes of this paragraph, the term 
     `excess employee compensation' means the sum of--

       ``(aa) with respect to any employee, for any plan year, the 
     excess (if any) of--
       ``(AA) the aggregate amount includible in income under 
     chapter 1 for remuneration during the calendar year in which 
     such plan year begins for services performed by the employee 
     for the plan sponsor (whether or not performed during such 
     calendar year), over
       ``(BB) $1,000,000, plus
       ``(bb) the amount of assets set aside or reserved (directly 
     or indirectly) in a trust (or other arrangement as determined 
     by the Secretary), or transferred to such a trust or other 
     arrangement, during the calendar year by a plan sponsor for 
     purposes of paying deferred compensation of an employee under 
     a nonqualified deferred compensation plan (as defined in 
     section 409A) of the plan sponsor.

       ``(II) No double counting.--No amount shall be taken into 
     account under subclause (I) more than once.
       ``(III) Employee; remuneration.--For purposes of this 
     clause, the term `employee' includes, with respect to a 
     calendar year, a self-employed individual who is treated as 
     an employee under section 401(c) for the taxable year ending 
     during such calendar year, and the term `remuneration' shall 
     include earned income of such an individual.
       ``(IV) Certain payments under existing contracts.--There 
     shall not be taken into account under subclause (I) any 
     remuneration consisting of nonqualified deferred 
     compensation, restricted stock (or restricted stock units), 
     stock options, or stock appreciation rights payable or 
     granted under a written binding contract that was in effect 
     on March 1, 2010, and which was not modified in any material 
     respect before such remuneration is paid.
       ``(V) Only remuneration for post-2009 services counted.--
     Remuneration shall be taken into account under subclause 
     (I)(aa) only to the extent attributable to services performed 
     by the employee for the plan sponsor after December 31, 2009.
       ``(VI) Commissions.--

       ``(aa) In general.--There shall not be taken into account 
     under subclause (I)(aa) any remuneration payable on a 
     commission basis solely on account of income directly 
     generated by the individual performance of the individual to 
     whom such remuneration is payable.
       ``(bb) Specified employees.--Item (aa) shall not apply in 
     the case of any specified employee (within the meaning of 
     section 409A(a)(2)(B)(i)) or any employee who would be such a 
     specified employee if the plan sponsor were a corporation 
     described in such section.

       ``(VII) Indexing of amount.--In the case of any calendar 
     year beginning after 2010, the dollar amount under subclause 
     (I)(aa)(BB) shall be increased by an amount equal to--

       ``(aa) such dollar amount, multiplied by
       ``(bb) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year, determined by 
     substituting `calendar year 2009' for `calendar year 1992' in 
     subparagraph (B) thereof.

     If the amount of any increase under clause (i) is not a 
     multiple of $20,000, such increase shall be rounded to the 
     next lowest multiple of $20,000.

       ``(v) Certain dividends and redemptions.--

       ``(I) In general.--The dividend and redemption amount 
     determined under this clause for any plan year is the lesser 
     of--

       ``(aa) the excess of--
       ``(AA) the sum of the dividends paid during the plan year 
     by the plan sponsor, plus the amounts paid for the redemption 
     of stock of the plan sponsor redeemed during the plan year, 
     over
       ``(BB) an amount equal to the average of adjusted annual 
     net income of the plan sponsor for the last 5 fiscal years of 
     the plan sponsor ending before such plan year, or
       ``(bb) the sum of--
       ``(AA) the amounts paid for the redemption of stock of the 
     plan sponsor redeemed during the plan year, plus
       ``(BB) the excess of dividends paid during the plan year by 
     the plan sponsor over the dividend base amount.

       ``(II) Definitions.--

       ``(aa) Adjusted annual net income.--For purposes of 
     subclause (I)(aa)(BB), the term `adjusted annual net income' 
     with respect to any fiscal year means annual net income, 
     determined in accordance with generally accepted accounting 
     principles (before after-tax gain or loss on any sale of 
     assets), but without regard to any reduction by reason of 
     depreciation or amortization, except that in no event shall 
     adjusted annual net income for any fiscal year be less than 
     zero.
       ``(bb) Dividend base amount.--For purposes of this clause, 
     the term `dividend base amount' means, with respect to a plan 
     year, an amount equal to the greater of--
       ``(AA) the median of the amounts of the dividends paid 
     during each of the last 5 fiscal years of the plan sponsor 
     ending before such plan year, or
       ``(BB) the amount of dividends paid during such plan year 
     on preferred stock that was issued on or before May 21, 2010, 
     or that is replacement stock for such preferred stock.

       ``(III) Only certain post-2009 dividends and redemptions 
     counted.--For purposes of subclause (I) (other than for 
     purposes of calculating the dividend base amount), there 
     shall only be taken into account dividends declared, and 
     redemptions occurring, after February 28, 2010.
       ``(IV) Exception for intra-group dividends.--Dividends paid 
     by one member of a controlled group (as defined in section 
     412(d)(3)) to another member of such group shall not be taken 
     into account under subclause (I).
       ``(V) Exception for stock dividends.--Any distribution by 
     the plan sponsor to its shareholders of stock issued by the 
     plan sponsor shall not be taken into account under subclause 
     (I).
       ``(VI) Exception for certain redemptions.--The following 
     shall not be taken into account under subclause (I):

       ``(aa) Redemptions of securities which, at the time of 
     redemption, are not listed on an established securities 
     market and--
       ``(AA) are made pursuant to a pension plan that is 
     qualified under section 401 or a shareholder-approved 
     program, or
       ``(BB) are made on account of an employee's termination of 
     employment with the plan sponsor, or the death or disability 
     of a shareholder.
       ``(bb) Redemptions of securities which are not, immediately 
     after issuance, listed on an established securities market 
     and are, or had previously been--
       ``(AA) held, directly or indirectly, by, or for the benefit 
     of, the Federal Government or a Federal reserve bank, or
       ``(BB) held by a national government (or a government-
     related entity of such a government) or an employee benefit 
     plan if such shares are substantially identical to shares 
     described in subitem (AA).
       ``(vi) Other definitions and rules.--For purposes of this 
     subparagraph--

       ``(I) Plan sponsor.--The term `plan sponsor' includes any 
     group of which the plan sponsor is a member and which is 
     treated as a single employer under subsection (b), (c), (m), 
     or (o) of section 414.

[[Page 10104]]

       ``(II) Restriction period.--The term `restriction period' 
     means, with respect to any applicable plan year with respect 
     to which an election is made under subparagraph (D)--

       ``(aa) except as provided in item (bb), the 3-year period 
     beginning with the applicable plan year (or, if later, the 
     first plan year beginning after December 31, 2009), or
       ``(bb) if the plan sponsor elects 15-year amortization for 
     the shortfall amortization base for the applicable plan year, 
     the 5-year period beginning with such plan year (or, if 
     later, the first plan year beginning after December 31, 
     2009).

       ``(III) Elections for multiple plans.--If a plan sponsor 
     makes elections under subparagraph (D) with respect to 2 or 
     more plans, the Secretary shall provide rules for the 
     application of this subparagraph to such plans, including 
     rules for the ratable allocation of any installment 
     acceleration amount among such plans on the basis of each 
     plan's relative reduction in the plan's shortfall 
     amortization installment for the first plan year in the 
     amortization period described in clause (i) (determined 
     without regard to this subparagraph).

       ``(G) Mergers and acquisitions.--The Secretary shall 
     prescribe rules for the application of subparagraphs (D) and 
     (F) in any case where there is a merger or acquisition 
     involving a plan sponsor making the election under 
     subparagraph (D).
       ``(H) Regulations and guidance.--The Secretary may 
     prescribe such regulations and other guidance of general 
     applicability as the Secretary may determine necessary to 
     achieve the purposes of subparagraphs (D) and (F).''.
       (2) Notice requirement.--
       (A) In general.--Section 4980F of such Code is amended--
       (i) by striking ``subsection (e)'' each place it appears in 
     subsection (a) and paragraphs (1) and (3) of subsection (c) 
     and inserting ``subsections (e) and (f)'';
       (ii) by striking ``subsection (e)'' in subsection (c)(2)(A) 
     and inserting ``subsection (e), (f), or both, as the case may 
     be''; and
       (iii) by redesignating subsection (f) as subsection (g) and 
     by inserting after subsection (e) the following new 
     subsection:
       ``(f) Notice in Connection With Shortfall Amortization 
     Election.--
       ``(1) In general.--Not later 30 days after the date of an 
     election under clause (iv) of section 430(c)(2)(D) in 
     connection with a plan, the plan administrator shall provide 
     notice of such election in accordance with this subsection to 
     each plan participant and beneficiary, each labor 
     organization representing such participants and 
     beneficiaries, and the Pension Benefit Guaranty Corporation.
       ``(2) Matters included in notice.--Each notice provided 
     pursuant to this subsection shall set forth--
       ``(A) a statement that recently enacted legislation permits 
     employers to delay pension funding;
       ``(B) with respect to required contributions--
       ``(i) the amount of contributions that would have been 
     required had the election not been made;
       ``(ii) the amount of the reduction in required 
     contributions for the applicable plan year that occurs on 
     account of the election; and
       ``(iii) the number of plan years to which such reduction 
     will apply;
       ``(C) with respect to a plan's funding status as of the end 
     of the plan year preceding the applicable plan year--
       ``(i) the liabilities determined under section 
     4010(d)(1)(A) of the Employee Retirement Income Security Act 
     of 1974; and
       ``(ii) the market value of assets of the plan; and
       ``(D) with respect to installment acceleration amounts (as 
     defined in section 430(c)(2)(F)(iii)(I))--
       ``(i) an explanation of section 430(c)(2)(F) (relating to 
     increases in shortfall amortization installments in cases of 
     excess compensation or certain dividends or stock 
     redemptions); and
       ``(ii) a statement that increases in required contributions 
     may occur in the event of future payments of excess employee 
     compensation or certain share repurchasing or dividend 
     activity and that subsequent notices of any such payments or 
     activity will be provided in the annual funding notice 
     provided pursuant to section 101(f) of the Employee 
     Retirement Income Security Act of 1974.
       ``(3) Other requirements.--
       ``(A) Form.--The notice required by paragraph (1) shall be 
     written in a manner calculated to be understood by the 
     average plan participant and shall provide sufficient 
     information (as determined in accordance with regulations or 
     other guidance of general applicability prescribed by the 
     Secretary) to allow plan participants and beneficiaries to 
     understand the effect of the election. The Secretary shall 
     prescribe a model notice that a plan administrator may use to 
     satisfy the requirements of paragraph (1).
       ``(B) Provision to designated persons.--Any notice under 
     paragraph (1) may be provided to a person designated, in 
     writing, by the person to which it would otherwise be 
     provided.''.
       (B) Conforming amendment.--Subsection (g) of section 4980F 
     of such Code is amended by inserting ``or (f)'' after 
     ``subsection (e)''.
       (3) Disregard of installment acceleration amounts in 
     determining quarterly contributions.--Section 430(j)(3) of 
     such Code is amended by adding at the end the following new 
     subparagraph:
       ``(F) Disregard of installment acceleration amounts.--
     Subparagraph (D) shall be applied without regard to any 
     increase under subsection (c)(2)(F).''.
       (4) Conforming amendment.--Paragraph (1) of section 430(c) 
     of such Code is amended by striking ``the shortfall 
     amortization bases for such plan year and each of the 6 
     preceding plan years'' and inserting ``any shortfall 
     amortization base which has not been fully amortized under 
     this subsection''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after December 31, 2007.

     SEC. 302. APPLICATION OF EXTENDED AMORTIZATION PERIOD TO 
                   PLANS SUBJECT TO PRIOR LAW FUNDING RULES.

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

     ``SEC. 107. APPLICATION OF FUNDING RELIEF TO PLANS WITH 
                   DELAYED EFFECTIVE DATE.

       ``(a) Alternative Elections.--
       ``(1) In general.--Subject to this section, a plan sponsor 
     of a plan to which section 104, 105, or 106 of this Act 
     applies may either elect the application of subsection (b) 
     with respect to the plan for not more than 2 applicable plan 
     years or elect the application of subsection (c) with respect 
     to the plan for 1 applicable plan year.
       ``(2) Eligibility for elections.--An election may be made 
     by a plan sponsor under paragraph (1) with respect to a plan 
     only if at the time of the election--
       ``(A) the plan sponsor is not a debtor in a case under 
     title 11, United States Code, or similar Federal or State 
     law,
       ``(B) there are no accumulated funding deficiencies (as 
     defined in section 302(a)(2) of the Employee Retirement 
     Income Security Act of 1974 (as in effect immediately before 
     the enactment of this Act) or in section 412(a) of the 
     Internal Revenue Code of 1986 (as so in effect)) with respect 
     to the plan,
       ``(C) there is no lien in favor of the plan under section 
     302(d) (as so in effect) or under section 412(n) of such Code 
     (as so in effect), and
       ``(D) a distress termination has not been initiated for the 
     plan under section 4041(c) of the Employee Retirement Income 
     Security Act of 1974.
       ``(b) Alternative Additional Funding Charge.--If the plan 
     sponsor elects the application of this subsection with 
     respect to the plan, for purposes of applying section 302(d) 
     of the Employee Retirement Income Security Act of 1974 (as in 
     effect before the amendments made by this subtitle and 
     subtitle B) and section 412(l) of the Internal Revenue Code 
     of 1986 (as so in effect)--
       ``(1) the deficit reduction contribution under paragraph 
     (2) of such section 302(d) and paragraph (2) of such section 
     412(l) for such plan for any applicable plan year, shall be 
     zero, and
       ``(2) the additional funding charge under paragraph (1) of 
     such section 302(d) and paragraph (1) of such section 412(l) 
     for such plan for any applicable plan year shall be increased 
     by an amount equal to the installment acceleration amount (as 
     defined in sections 303(c)(2)(F)(iii)(I) of such Act (as 
     amended by the American Jobs and Closing Tax Loopholes Act of 
     2010) and 430(c)(2)(F)(iii)(I) of such Code (as so amended)) 
     with respect to the plan sponsor for such plan year, 
     determined by treating the later of such plan year or the 
     first plan year beginning after December 31, 2009, as the 
     restriction period.
       ``(c) Application of 15-year Amortization.--If the plan 
     sponsor elects the application of this subsection with 
     respect to the plan, for purposes of applying section 302(d) 
     of such Act (as in effect before the amendments made by this 
     subtitle and subtitle B) and section 412(l) of such Code (as 
     so in effect)--
       ``(1) in the case of the increased unfunded new liability 
     of the plan, the applicable percentage described in paragraph 
     (4)(C) of such section 302(d) and paragraph (4)(C) of such 
     section 412(l) for any pre-effective date plan year beginning 
     with or after the applicable plan year shall be the ratio 
     of--
       ``(A) the annual installments payable in each plan year if 
     the increased unfunded new liability for such plan year were 
     amortized in equal installments over the period beginning 
     with such plan year and ending with the last plan year in the 
     period of 15 plan years beginning with the applicable plan 
     year, using an interest rate equal to the third segment rate 
     described in sections 104(b), 105(b), and 106(b) of this Act, 
     to
       ``(B) the increased unfunded new liability for such plan 
     year,
       ``(2) in the case of the excess of the unfunded new 
     liability over the increased unfunded new liability, such 
     applicable percentage shall be determined without regard to 
     this section, and
       ``(3) the additional funding charge with respect to the 
     plan for a plan year shall be increased by an amount equal to 
     the installment acceleration amount (as defined in section 
     303(c)(2)(F)(iii) of such Act (as amended

[[Page 10105]]

     by the American Jobs and Closing Tax Loopholes Act of 2010 
     and section 430(c)(2)(F)(iii) of such Code (as so amended)) 
     with respect to the plan sponsor for such plan year, 
     determined without regard to subclause (II) of such sections 
     303(c)(2)(F)(iii) and 430(c)(2)(F)(iii).
       ``(d) Definitions and Special Rules.--For purposes of this 
     section--
       ``(1) Applicable plan year.--
       ``(A) In general.--The term `applicable plan year' with 
     respect to a plan means, subject to the election of the plan 
     sponsor under subsection (a), a plan year beginning in 2009, 
     2010, or 2011.
       ``(B) Election.--
       ``(i) In general.--The election described in subsection (a) 
     shall be made at such times, and in such form and manner, as 
     shall be prescribed by the Secretary of the Treasury.
       ``(ii) Reduction in years which may be elected.--The number 
     of applicable plan years for which an election may be made 
     under section 303(c)(2)(D) of the Employee Retirement Income 
     Security Act of 1974 (as amended by the American Jobs and 
     Closing Tax Loopholes Act of 2010) or section 430(c)(2)(D) of 
     the Internal Revenue Code of 1986 (as so amended) shall be 
     reduced by the number of applicable plan years for which an 
     election under this section is made.
       ``(C) Allocation of installment acceleration amount for 
     multiple plan election.--In the case of an election under 
     this section with respect to 2 or more plans by the same plan 
     sponsor, the installment acceleration amount shall be 
     apportioned ratably with respect to such plans in proportion 
     to the deficit reduction contributions of the plans 
     determined without regard to subsection (b)(1).
       ``(2) Plan sponsor.--The term `plan sponsor' shall have the 
     meaning provided such term in section 303(c)(2)(F)(vi)(I) of 
     the Employee Retirement Income Security Act of 1974 (as 
     amended by the American Jobs and Closing Tax Loopholes Act of 
     2010) and section 430(c)(2)(F)(vi)(I) of the Internal Revenue 
     Code of 1986 (as so amended).
       ``(3) Pre-effective date plan year.--The term `pre-
     effective date plan year' means, with respect to a plan, any 
     plan year prior to the first year in which the amendments 
     made by this subtitle and subtitle B apply to the plan.
       ``(4) Increased unfunded new liability.--The term 
     `increased unfunded new liability' means, with respect to a 
     year, the excess (if any) of the unfunded new liability over 
     the amount of unfunded new liability determined as if the 
     value of the plan's assets determined under subsection 
     302(c)(2) of such Act (as in effect before the amendments 
     made by this subtitle and subtitle B) and section 412(c)(2) 
     of such Code (as so in effect) equaled the product of the 
     current liability of the plan for the year multiplied by the 
     funded current liability percentage (as defined in section 
     302(d)(8)(B) of such Act (as so in effect) and 412(l)(8)(B) 
     of such Code (as so in effect)) of the plan for the second 
     plan year preceding the first applicable plan year of such 
     plan for which an election under this section is made.
       ``(5) Other definitions.--The terms `unfunded new 
     liability' and `current liability' shall have the meanings 
     set forth in section 302(d) of such Act (as so in effect) and 
     section 412(l) of such Code (as so in effect).
       ``(6) Additional funding charge increase not to exceed 
     relief.--
       ``(A) Election under subsection (b).--In the case of an 
     election under subsection (b), an increase resulting from the 
     application of subsection (b)(2) in the additional funding 
     charge with respect to a plan for a plan year shall not 
     exceed the excess (if any) of--
       ``(i) the deficit reduction contribution under section 
     302(d)(2) of such Act (as so in effect) and section 412(l)(2) 
     of such Code (as so in effect) for such plan year, determined 
     as if the election had not been made, over
       ``(ii) the deficit reduction contribution under such 
     sections for such plan (determined without regard to any 
     increase under subsection (b)(2)).
       ``(B) Election under subsection (c).--An increase resulting 
     from the application of subsection (c)(3) in the additional 
     funding charge with respect to a plan for a plan year shall 
     not exceed the excess (if any) of--
       ``(i) the sum of the deficit reduction contributions under 
     section 302(d)(2) of such Act (as so in effect) and section 
     412(l)(2) of such Code (as so in effect) for such plan for 
     such plan year and for all preceding plan years beginning 
     with or after the applicable plan year, determined as if the 
     election had not been made, over
       ``(ii) the sum of the deficit reduction contributions under 
     such sections for such plan years (determined without regard 
     to any increase under subsection (c)(3)).
       ``(e) Notice.--Not later 30 days after the date of an 
     election under subsection (a) in connection with a plan, the 
     plan administrator shall provide notice pursuant to, and 
     subject to, rules similar to the rules of sections 204(k) of 
     the Employee Retirement Income Security Act of 1974 (as 
     amended by the American Jobs and Closing Tax Loopholes Act of 
     2010) and 4980F(f) of the Internal Revenue Code of 1986 (as 
     so amended).''.
       (b) Eligible Charity Plans.--Section 104 of such Act is 
     amended--
       (1) by striking ``eligible cooperative plan'' wherever it 
     appears in subsections (a) and (b) and inserting ``eligible 
     cooperative plan or an eligible charity plan''; and
       (2) by adding at the end the following new subsection:
       ``(d) Eligible Charity Plan Defined.--For purposes of this 
     section, a plan shall be treated as an eligible charity plan 
     for a plan year if--
       ``(1) the plan is maintained by one or more employers 
     employing employees who are accruing benefits based on 
     service for the plan year,
       ``(2) such employees are employed in at least 20 States,
       ``(3) each such employee (other than a de minimis number of 
     employees) is employed by an employer described in section 
     501(c)(3) of such Code and the primary exempt purpose of each 
     such employer is to provide services with respect to 
     children, and
       ``(4) the plan sponsor elects (at such time and in such 
     form and manner as shall be prescribed by the Secretary of 
     the Treasury) to be so treated.

     Any election under this subsection may be revoked only with 
     the consent of the Secretary of the Treasury.''.
       (c) Regulations.--The Secretary of the Treasury may 
     prescribe such regulations as may be necessary to carry out 
     the purposes of the amendments made by this section.
       (d) Effective Date.--
       (1) In general.--The amendment made by subsection (a) shall 
     apply to plan years beginning on or after January 1, 2009.
       (2) Eligible charity plans.--The amendments made by 
     subsection (b) shall apply to plan years beginning after 
     December 31, 2009.

     SEC. 303. SUSPENSION OF CERTAIN FUNDING LEVEL LIMITATIONS.

       (a) Limitations on Benefit Accruals.--Section 203 of the 
     Worker, Retiree, and Employer Recovery Act of 2008 (Public 
     Law 110-458; 122 Stat. 5118) is amended--
       (1) by striking ``the first plan year beginning during the 
     period beginning on October 1, 2008, and ending on September 
     30, 2009'' and inserting ``any plan year beginning during the 
     period beginning on October 1, 2008, and ending on December 
     31, 2011'';
       (2) by striking ``substituting'' and all that follows 
     through ``for such plan year'' and inserting ``substituting 
     for such percentage the plan's adjusted funding target 
     attainment percentage for the last plan year ending before 
     September 30, 2009,''; and
       (3) by striking ``for the preceding plan year is greater'' 
     and inserting ``for such last plan year is greater''.
       (b) Social Security Level-income Options.--
       (1) ERISA amendment.--Section 206(g)(3)(E) of the Employee 
     Retirement Income Security Act of 1974 is amended by adding 
     at the end the following new sentence: ``For purposes of 
     applying clause (i) in the case of payments the annuity 
     starting date for which occurs on or before December 31, 
     2011, payments under a social security leveling option shall 
     be treated as not in excess of the monthly amount paid under 
     a single life annuity (plus an amount not in excess of a 
     social security supplement described in the last sentence of 
     section 204(b)(1)(G)).''.
       (2) IRC amendment.--Section 436(d)(5) of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new sentence: ``For purposes of applying 
     subparagraph (A) in the case of payments the annuity starting 
     date for which occurs on or before December 31, 2011, 
     payments under a social security leveling option shall be 
     treated as not in excess of the monthly amount paid under a 
     single life annuity (plus an amount not in excess of a social 
     security supplement described in the last sentence of section 
     411(a)(9)).''.
       (3) Effective date.--
       (A) In general.--The amendments made by this subsection 
     shall apply to annuity payments the annuity starting date for 
     which occurs on or after January 1, 2011.
       (B) Permitted application.--A plan shall not be treated as 
     failing to meet the requirements of sections 206(g) of the 
     Employee Retirement Income Security Act of 1974 (as amended 
     by this subsection) and section 436(d) of the Internal 
     Revenue Code of 1986 (as so amended) if the plan sponsor 
     elects to apply the amendments made by this subsection to 
     payments the annuity starting date for which occurs on or 
     after the date of the enactment of this Act and before 
     January 1, 2011.
       (c) Application of Credit Balance With Respect to 
     Limitations on Shutdown Benefits and Unpredictable Contingent 
     Event Benefits.--With respect to plan years beginning on or 
     before December 31, 2011, in applying paragraph (5)(C) of 
     subsection (g) of section 206 of the Employee Retirement 
     Income Security Act of 1974 and subsection (f)(3) of section 
     436 of the Internal Revenue Code of 1986 in the case of 
     unpredictable contingent events (within the meaning of 
     section 206(g)(1)(C) of such Act and section 436(b)(3) of 
     such Code) occurring on or after January 1, 2010, the 
     references, in clause (i) of such paragraph (5)(C) and 
     subparagraph (A) of such subsection (f)(3), to paragraph 
     (1)(B) of such subsection (g) and subsection (b)(2) of such 
     section 436 shall be disregarded.

     SEC. 304. LOOKBACK FOR CREDIT BALANCE RULE.

       (a) Amendment to Erisa.--Paragraph (3) of section 303(f) of 
     the Employee Retirement

[[Page 10106]]

     Income Security Act of 1974 is amended by adding the 
     following at the end thereof:
       ``(D) Special rule for certain plan years.--
       ``(i) In general.--For purposes of applying subparagraph 
     (C) for plan years beginning after June 30, 2009, and on or 
     before December 31, 2011, the ratio determined under such 
     subparagraph for the preceding plan year shall be the greater 
     of--

       ``(I) such ratio, as determined without regard to this 
     subparagraph, or
       ``(II) the ratio for such plan for the plan year beginning 
     after June 30, 2007, and on or before June 30, 2008, as 
     determined under rules prescribed by the Secretary of the 
     Treasury.

       ``(ii) Special rule.--In the case of a plan for which the 
     valuation date is not the first day of the plan year--

       ``(I) clause (i) shall apply to plan years beginning after 
     December 31, 2008, and on or before December 31, 2010, and
       ``(II) clause (i)(II) shall apply based on the last plan 
     year beginning before July 1, 2007, as determined under rules 
     prescribed by the Secretary of the Treasury.''.

       (b) Amendment to Internal Revenue Code of 1986.--Paragraph 
     (3) of section 430(f) of the Internal Revenue Code of 1986 is 
     amended by adding the following at the end thereof:
       ``(D) Special rule for certain plan years.--
       ``(i) In general.--For purposes of applying subparagraph 
     (C) for plan years beginning after June 30, 2009, and on or 
     before December 31, 2011, the ratio determined under such 
     subparagraph for the preceding plan year shall be the greater 
     of--

       ``(I) such ratio, as determined without regard to this 
     subparagraph, or
       ``(II) the ratio for such plan for the plan year beginning 
     after June 30, 2007, and on or before June 30, 2008, as 
     determined under rules prescribed by the Secretary.

       ``(ii) Special rule.--In the case of a plan for which the 
     valuation date is not the first day of the plan year--

       ``(I) clause (i) shall apply to plan years beginning after 
     December 31, 2008, and on or before December 31, 2010, and
       ``(II) clause (i)(II) shall apply based on the last plan 
     year beginning before July 1, 2007, as determined under rules 
     prescribed by the Secretary.''.

     SEC. 305. INFORMATION REPORTING.

       (a) In General.--Section 4010(b) of the Employee Retirement 
     Security Act of 1974 (29 U.S.C. 1310(b)) is amended by 
     striking paragraph (1) and inserting the following:
       ``(1) either of the following requirements are met:
       ``(A) the funding target attainment percentage (as defined 
     in subsection (d)(2)(B)) at the end of the preceding plan 
     year of a plan maintained by the contributing sponsor or any 
     member of its controlled group is less than 80 percent; or
       ``(B) the aggregate unfunded vested benefits (as determined 
     under section 4006(a)(3)(E)(iii)) of plans maintained by the 
     contributing sponsor and the members of its controlled group 
     exceed $75,000,000 (disregarding plans with no unfunded 
     vested benefits);''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to years beginning after 2009.

     SEC. 306. ROLLOVER OF AMOUNTS RECEIVED IN AIRLINE CARRIER 
                   BANKRUPTCY.

       (a) General Rules.--
       (1) Rollover of airline payment amount.--If a qualified 
     airline employee receives any airline payment amount and 
     transfers any portion of such amount to a traditional IRA 
     within 180 days of receipt of such amount (or, if later, 
     within 180 days of the date of the enactment of this Act), 
     then such amount (to the extent so transferred) shall be 
     treated as a rollover contribution described in section 
     402(c) of the Internal Revenue Code of 1986. A qualified 
     airline employee making such a transfer may exclude from 
     gross income the amount transferred, in the taxable year in 
     which the airline payment amount was paid to the qualified 
     airline employee by the commercial passenger airline carrier.
       (2) Transfer of amounts attributable to airline payment 
     amount following rollover to roth ira.--A qualified airline 
     employee who has contributed an airline payment amount to a 
     Roth IRA that is treated as a qualified rollover contribution 
     pursuant to section 125 of the Worker, Retiree, and Employer 
     Recovery Act of 2008 may transfer to a traditional IRA, in a 
     trustee-to-trustee transfer, all or any part of the 
     contribution (together with any net income allocable to such 
     contribution), and the transfer to the traditional IRA will 
     be deemed to have been made at the time of the rollover to 
     the Roth IRA, if such transfer is made within 180 days of the 
     date of the enactment of this Act. A qualified airline 
     employee making such a transfer may exclude from gross income 
     the airline payment amount previously rolled over to the Roth 
     IRA, to the extent an amount attributable to the previous 
     rollover was transferred to a traditional IRA, in the taxable 
     year in which the airline payment amount was paid to the 
     qualified airline employee by the commercial passenger 
     airline carrier. No amount so transferred to a traditional 
     IRA may be treated as a qualified rollover contribution with 
     respect to a Roth IRA within the 5-taxable year period 
     beginning with the taxable year in which such transfer was 
     made.
       (3) Extension of time to file claim for refund.--A 
     qualified airline employee who excludes an amount from gross 
     income in a prior taxable year under paragraph (1) or (2) may 
     reflect such exclusion in a claim for refund filed within the 
     period of limitation under section 6511(a) (or, if later, 
     April 15, 2011).
       (b) Treatment of Airline Payment Amounts and Transfers for 
     Employment Taxes.--For purposes of chapter 21 of the Internal 
     Revenue Code of 1986 and section 209 of the Social Security 
     Act, an airline payment amount shall not fail to be treated 
     as a payment of wages by the commercial passenger airline 
     carrier to the qualified airline employee in the taxable year 
     of payment because such amount is excluded from the qualified 
     airline employee's gross income under subsection (a).
       (c) Definitions and Special Rules.--For purposes of this 
     section--
       (1) Airline payment amount.--
       (A) In general.--The term ``airline payment amount'' means 
     any payment of any money or other property which is payable 
     by a commercial passenger airline carrier to a qualified 
     airline employee--
       (i) under the approval of an order of a Federal bankruptcy 
     court in a case filed after September 11, 2001, and before 
     January 1, 2007; and
       (ii) in respect of the qualified airline employee's 
     interest in a bankruptcy claim against the carrier, any note 
     of the carrier (or amount paid in lieu of a note being 
     issued), or any other fixed obligation of the carrier to pay 
     a lump sum amount.

     The amount of such payment shall be determined without regard 
     to any requirement to deduct and withhold tax from such 
     payment under sections 3102(a) and 3402(a).
       (B) Exception.--An airline payment amount shall not include 
     any amount payable on the basis of the carrier's future 
     earnings or profits.
       (2) Qualified airline employee.--The term ``qualified 
     airline employee'' means an employee or former employee of a 
     commercial passenger airline carrier who was a participant in 
     a defined benefit plan maintained by the carrier which--
       (A) is a plan described in section 401(a) of the Internal 
     Revenue Code of 1986 which includes a trust exempt from tax 
     under section 501(a) of such Code; and
       (B) was terminated or became subject to the restrictions 
     contained in paragraphs (2) and (3) of section 402(b) of the 
     Pension Protection Act of 2006.
       (3) Traditional ira.--The term ``traditional IRA'' means an 
     individual retirement plan (as defined in section 7701(a)(37) 
     of the Internal Revenue Code of 1986) which is not a Roth 
     IRA.
       (4) Roth ira.--The term ``Roth IRA'' has the meaning given 
     such term by section 408A(b) of such Code.
       (d) Surviving Spouse.--If a qualified airline employee died 
     after receiving an airline payment amount, or if an airline 
     payment amount was paid to the surviving spouse of a 
     qualified airline employee in respect of the qualified 
     airline employee, the surviving spouse of the qualified 
     airline employee may take all actions permitted under section 
     125 of the Worker, Retiree and Employer Recovery Act of 2008, 
     or under this section, to the same extent that the qualified 
     airline employee could have done had the qualified airline 
     employee survived.
       (e) Effective Date.--This section shall apply to transfers 
     made after the date of the enactment of this Act with respect 
     to airline payment amounts paid before, on, or after such 
     date.

                    Subtitle B--Multiemployer Plans

     SEC. 311. OPTIONAL USE OF 30-YEAR AMORTIZATION PERIODS.

       (a) Elective Special Relief Rules.--
       (1) ERISA amendment.--Section 304(b) of the Employee 
     Retirement Income Security Act of 1974 is amended by adding 
     at the end the following new paragraph:
       ``(8) Elective special relief rules.--Notwithstanding any 
     other provision of this subsection--
       ``(A) Amortization of net investment losses.--
       ``(i) In general.--The plan sponsor of a multiemployer plan 
     with respect to which the solvency test under subparagraph 
     (B) is met may elect to treat the portion of any experience 
     loss or gain for a plan year that is attributable to the 
     allocable portion of the net investment losses incurred in 
     either or both of the first two plan years ending on or after 
     June 30, 2008, as an experience loss separate from other 
     experience losses or gains to be amortized in equal annual 
     installments (until fully amortized) over the period--

       ``(I) beginning with the plan year for which the allocable 
     portion is determined, and
       ``(II) ending with the last plan year in the 30-plan year 
     period beginning with the plan year following the plan year 
     in which such net investment loss was incurred.

       ``(ii) Coordination with extensions.--If an election is 
     made under clause (i) for any plan year--

       ``(I) no extension of the amortization period under clause 
     (i) shall be allowed under subsection (d), and
       ``(II) if an extension was granted under subsection (d) for 
     any plan year before the

[[Page 10107]]

     plan year for which the election under this subparagraph is 
     made, such extension shall not result in such amortization 
     period exceeding 30 years.

       ``(iii) Definitions and rules.--For purposes of this 
     subparagraph--

       ``(I) Net investment losses.--

       ``(aa) In general.--The net investment loss incurred by a 
     plan in a plan year is equal to the excess of--
       ``(AA) the expected value of the assets as of the end of 
     the plan year, over
       ``(BB) the market value of the assets as of the end of the 
     plan year,

     including any difference attributable to a criminally 
     fraudulent investment arrangement.
       ``(bb) Expected value.--For purposes of item (aa), the 
     expected value of the assets as of the end of a plan year is 
     the excess of--
       ``(AA) the market value of the assets at the beginning of 
     the plan year plus contributions made during the plan year, 
     over
       ``(BB) disbursements made during the plan year.

     The amounts described in subitems (AA) and (BB) shall be 
     adjusted with interest at the valuation rate to the end of 
     the plan year.

       ``(II) Criminally fraudulent investment arrangements.--The 
     determination as to whether an arrangement is a criminally 
     fraudulent investment arrangement shall be made under rules 
     substantially similar to the rules prescribed by the 
     Secretary of the Treasury for purposes of section 165 of the 
     Internal Revenue Code of 1986.
       ``(III) Amount attributable to allocable portion of net 
     investment loss.--The amount attributable to the allocable 
     portion of the net investment loss for a plan year shall be 
     an amount equal to the allocable portion of net investment 
     loss for the plan year under subclauses (IV) and (V), 
     increased with interest at the valuation rate determined from 
     the plan year after the plan year in which the net investment 
     loss was incurred.
       ``(IV) Allocable portion of net investment losses.--Except 
     as provided in subclause (V), the net investment loss 
     incurred in a plan year shall be allocated among the 5 plan 
     years following the plan year in which the investment loss is 
     incurred in accordance with the following table:

``Plan year after the plan year in which the net investment loss was 
  incurred                                                             
                                                                       
                               Allocable portion of net investment loss
1st...............................................................\1/2\
2nd.................................................................  0
3rd...............................................................\1/6\
4th...............................................................\1/6\
5th...............................................................\1/6\

       ``(V) Special rule for plans that adopt longer smoother 
     period.--If a plan sponsor elects an extended smoothing 
     period for its asset valuation method under subsection 
     (c)(2)(B), then the allocable portion of net investment loss 
     for the first two plan years following the plan year the 
     investment loss is incurred is the same as determined under 
     subclause (IV), but the remaining \1/2\ of the net investment 
     loss is allocated ratably over the period beginning with the 
     third plan year following the plan year the net investment 
     loss is incurred and ending with the last plan year in the 
     extended smoothing period.
       ``(VI) Special rule for overstatement of loss.--If, for a 
     plan year, there is an experience loss for the plan and the 
     amount described in subclause (III) exceeds the total amount 
     of the experience loss for the plan year, then the excess 
     shall be treated as an experience gain.
       ``(VII) Special rule in years for which overall experience 
     is gain.--If, for a plan year, there is no experience loss 
     for the plan, then, in addition to amortization of net 
     investment losses under clause (i), the amount described in 
     subclause (III) shall be treated as an experience gain in 
     addition to any other experience gain.

       ``(B) Solvency test.--
       ``(i) In general.--An election may be made under this 
     paragraph if the election includes certification by the plan 
     actuary in connection with the election that the plan is 
     projected to have a funded percentage at the end of the first 
     15 plan years that is not less than 100 percent of the funded 
     percentage for the plan year of the election.
       ``(ii) Funded percentage.--For purposes of clause (i), the 
     term `funded percentage' has the meaning provided in section 
     305(i)(2), except that the value of the plan's assets 
     referred to in section 305(i)(2)(A) shall be the market value 
     of such assets.
       ``(iii) Actuarial assumptions.--In making any certification 
     under this subparagraph, the plan actuary shall use the same 
     actuarial estimates, assumptions, and methods as those 
     applicable for the most recent certification under section 
     305, except that the plan actuary may take into account 
     benefit reductions and increases in contribution rates, under 
     either funding improvement plans adopted under section 305(c) 
     or under section 432(c) of the Internal Revenue Code of 1986 
     or rehabilitation plans adopted under section 305(e) or under 
     section 432(e) of such Code, that the plan actuary reasonably 
     anticipates will occur without regard to any change in status 
     of the plan resulting from the election.
       ``(C) Additional restriction on benefit increases.--If an 
     election is made under subparagraph (A), then, in addition to 
     any other applicable restrictions on benefit increases, a 
     plan amendment which is adopted on or after March 10, 2010, 
     and which increases benefits may not go into effect during 
     the period beginning on such date and ending with the second 
     plan year beginning after such date unless--
       ``(i) the plan actuary certifies that--

       ``(I) any such increase is paid for out of additional 
     contributions not allocated to the plan immediately before 
     the election to have this paragraph apply to the plan, and
       ``(II) the plan's funded percentage and projected credit 
     balances for the first 3 plan years ending on or after such 
     date are reasonably expected to be at least as high as such 
     percentage and balances would have been if the benefit 
     increase had not been adopted, or

       ``(ii) the amendment is required as a condition of 
     qualification under part I of subchapter D of chapter 1 of 
     the Internal Revenue Code of 1986 or to comply with other 
     applicable law.
       ``(D) Time, form, and manner of election.--An election 
     under this paragraph shall be made not later than June 30, 
     2011, and shall be made in such form and manner as the 
     Secretary of the Treasury may prescribe.
       ``(E) Reporting.--A plan sponsor of a plan to which this 
     paragraph applies shall--
       ``(i) give notice of such election to participants and 
     beneficiaries of the plan, and
       ``(ii) inform the Pension Benefit Guaranty Corporation of 
     such election in such form and manner as the Pension Benefit 
     Guaranty Corporation may prescribe.''.
       (2) IRC amendment.--Section 431(b) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     new paragraph:
       ``(8) Elective special relief rules.--Notwithstanding any 
     other provision of this subsection--
       ``(A) Amortization of net investment losses.--
       ``(i) In general.--The plan sponsor of a multiemployer plan 
     with respect to which the solvency test under subparagraph 
     (B) is met may elect to treat the portion of any experience 
     loss or gain for a plan year that is attributable to the 
     allocable portion of the net investment losses incurred in 
     either or both of the first two plan years ending on or after 
     June 30, 2008, as an experience loss separate from other 
     experience losses and gains to be amortized in equal annual 
     installments (until fully amortized) over the period--

       ``(I) beginning with the plan year for which the allocable 
     portion is determined, and
       ``(II) ending with the last plan year in the 30-plan year 
     period beginning with the plan year following the plan year 
     in which such net investment loss was incurred.

       ``(ii) Coordination with extensions.--If an election is 
     made under clause (i) for any plan year--

       ``(I) no extension of the amortization period under clause 
     (i) shall be allowed under subsection (d), and
       ``(II) if an extension was granted under subsection (d) for 
     any plan year before the plan year for which the election 
     under this subparagraph is made, such extension shall not 
     result in such amortization period exceeding 30 years.

       ``(iii) Definitions and rules.--For purposes of this 
     subparagraph--

       ``(I) Net investment losses.--

       ``(aa) In general.--The net investment loss incurred by a 
     plan in a plan year is equal to the excess of--
       ``(AA) the expected value of the assets as of the end of 
     the plan year, over
       ``(BB) the market value of the assets as of the end of the 
     plan year,

     including any difference attributable to a criminally 
     fraudulent investment arrangement.
       ``(bb) Expected value.--For purposes of item (aa), the 
     expected value of the assets as of the end of a plan year is 
     the excess of--
       ``(AA) the market value of the assets at the beginning of 
     the plan year plus contributions made during the plan year, 
     over
       ``(BB) disbursements made during the plan year.

     The amounts described in subitems (AA) and (BB) shall be 
     adjusted with interest at the valuation rate to the end of 
     the plan year.

       ``(II) Criminally fraudulent investment arrangements.--The 
     determination as to whether an arrangement is a criminally 
     fraudulent investment arrangement shall be made under rules 
     substantially similar to the rules prescribed by the 
     Secretary for purposes of section 165.
       ``(III) Amount attributable to allocable portion of net 
     investment loss.--The amount attributable to the allocable 
     portion of the net investment loss for a plan year shall be 
     an amount equal to the allocable portion of net investment 
     loss for the plan year under subclauses (IV) and (V), 
     increased with interest at the valuation rate determined from 
     the plan year after the plan year in which the net investment 
     loss was incurred.
       ``(IV) Allocable portion of net investment losses.--Except 
     as provided in subclause (V), the net investment loss 
     incurred in a plan year shall be allocated among the 5 plan 
     years following the plan year in which the investment loss is 
     incurred in accordance with the following table:


[[Page 10108]]


``Plan year after the plan year in which the net investment loss was 
  incurred                                                             
                                                                       
                               Allocable portion of net investment loss
1st...............................................................\1/2\
2nd.................................................................  0
3rd...............................................................\1/6\
4th...............................................................\1/6\
5th...............................................................\1/6\

       ``(V) Special rule for plans that adopt longer smoother 
     period.--If a plan sponsor elects an extended smoothing 
     period for its asset valuation method under subsection 
     (c)(2)(B), then the allocable portion of net investment loss 
     for the first two plan years following the plan year the 
     investment loss is incurred is the same as determined under 
     subclause (IV), but the remaining \1/2\ of the net investment 
     loss is allocated ratably over the period beginning with the 
     third plan year following the plan year the net investment 
     loss is incurred and ending with the last plan year in the 
     extended smoothing period.
       ``(VI) Special rule for overstatement of loss.--If, for a 
     plan year, there is an experience loss for the plan and the 
     amount described in subclause (III) exceeds the total amount 
     of the experience loss for the plan year, then the excess 
     shall be treated as an experience gain.
       ``(VII) Special rule in years for which overall experience 
     is gain.--If, for a plan year, there is no experience loss 
     for the plan, then, in addition to amortization of net 
     investment losses under clause (i), the amount described in 
     subclause (III) shall be treated as an experience gain in 
     addition to any other experience gain.

       ``(B) Solvency test.--
       ``(i) In general.--An election may be made under this 
     paragraph if the election includes certification by the plan 
     actuary in connection with the election that the plan is 
     projected to have a funded percentage at the end of the first 
     15 plan years that is not less than 100 percent of the funded 
     percentage for the plan year of the election.
       ``(ii) Funded percentage.--For purposes of clause (i), the 
     term `funded percentage' has the meaning provided in section 
     432(i)(2), except that the value of the plan's assets 
     referred to in section 432(i)(2)(A) shall be the market value 
     of such assets.
       ``(iii) Actuarial assumptions.--In making any certification 
     under this subparagraph, the plan actuary shall use the same 
     actuarial estimates, assumptions, and methods as those 
     applicable for the most recent certification under section 
     432, except that the plan actuary may take into account 
     benefit reductions and increases in contribution rates, under 
     either funding improvement plans adopted under section 432(c) 
     or under section 305(c) of the Employee Retirement Income 
     Security Act of 1974 or rehabilitation plans adopted under 
     section 432(e) or under section 305(e) of such Act, that the 
     plan actuary reasonably anticipates will occur without regard 
     to any change in status of the plan resulting from the 
     election.
       ``(C) Additional restriction on benefit increases.--If an 
     election is made under subparagraph (A), then, in addition to 
     any other applicable restrictions on benefit increases, a 
     plan amendment which is adopted on or after March 10, 2010, 
     and which increases benefits may not go into effect during 
     the period beginning on such date and ending with the second 
     plan year beginning after such date unless--
       ``(i) the plan actuary certifies that--

       ``(I) any such increase is paid for out of additional 
     contributions not allocated to the plan immediately before 
     the election to have this paragraph apply to the plan, and
       ``(II) the plan's funded percentage and projected credit 
     balances for the first 3 plan years ending on or after such 
     date are reasonably expected to be at least as high as such 
     percentage and balances would have been if the benefit 
     increase had not been adopted, or

       ``(ii) the amendment is required as a condition of 
     qualification under part I or to comply with other applicable 
     law.
       ``(D) Time, form, and manner of election.--An election 
     under this paragraph shall be made not later than June 30, 
     2011, and shall be made in such form and manner as the 
     Secretary may prescribe.
       ``(E) Reporting.--A plan sponsor of a plan to which this 
     paragraph applies shall--
       ``(i) give notice of such election to participants and 
     beneficiaries of the plan, and
       ``(ii) inform the Pension Benefit Guaranty Corporation of 
     such election in such form and manner as the Pension Benefit 
     Guaranty Corporation may prescribe.''.
       (b) Asset Smoothing for Multiemployer Plans.--
       (1) ERISA amendment.--Section 304(c)(2) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1084(c)(2)) 
     is amended--
       (A) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (B) by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) Extended asset smoothing period for certain 
     investment losses.--The Secretary of the Treasury shall not 
     treat the asset valuation method of a multiemployer plan as 
     unreasonable solely because such method spreads the 
     difference between expected and actual returns for either or 
     both of the first 2 plan years ending on or after June 30, 
     2008, over a period of not more than 10 years. Any change in 
     valuation method to so spread such difference shall be 
     treated as approved, but only if, in the case that the plan 
     sponsor has made an election under subsection (b)(8), any 
     resulting change in asset value is treated for purposes of 
     amortization as a net experience loss or gain.''.
       (2) IRC amendment.--Section 431(c)(2) of the Internal 
     Revenue Code of 1986 is amended--
       (A) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (B) by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) Extended asset smoothing period for certain 
     investment losses.--The Secretary shall not treat the asset 
     valuation method of a multiemployer plan as unreasonable 
     solely because such method spreads the difference between 
     expected and actual returns for either or both of the first 2 
     plan years ending on or after June 30, 2008, over a period of 
     not more than 10 years. Any change in valuation method to so 
     spread such difference shall be treated as approved, but only 
     if, in the case that the plan sponsor has made an election 
     under subsection (b)(8), any resulting change in asset value 
     is treated for purposes of amortization as a net experience 
     loss or gain.''.
       (c) Effective Date and Special Rules.--
       (1) Effective date.--The amendments made by this section 
     shall take effect as of the first day of the first plan year 
     beginning after June 30, 2008, except that any election a 
     plan sponsor makes pursuant to this section or the amendments 
     made thereby that affects the plan's funding standard account 
     for any plan year beginning before October 1, 2009, shall be 
     disregarded for purposes of applying the provisions of 
     section 305 of the Employee Retirement Income Security Act of 
     1974 and section 432 of the Internal Revenue Code of 1986 to 
     that plan year.
       (2) Deemed approval for certain funding method changes.--In 
     the case of a multiemployer plan with respect to which an 
     election has been made under section 304(b)(8) of the 
     Employee Retirement Income Security Act of 1974 (as amended 
     by this section) or section 431(b)(8) of the Internal Revenue 
     Code of 1986 (as so amended)--
       (A) any change in the plan's funding method for a plan year 
     beginning on or after July 1, 2008, and on or before December 
     31, 2010, from a method that does not establish a base for 
     experience gains and losses to one that does establish such a 
     base shall be treated as approved by the Secretary of the 
     Treasury; and
       (B) any resulting funding method change base shall be 
     treated for purposes of amortization as a net experience loss 
     or gain.

     SEC. 312. OPTIONAL LONGER RECOVERY PERIODS FOR MULTIEMPLOYER 
                   PLANS IN ENDANGERED OR CRITICAL STATUS.

       (a) ERISA Amendments.--
       (1) Funding improvement period.--Section 305(c)(4) of the 
     Employee Retirement Income Security Act of 1974 is amended--
       (A) by redesignating subparagraphs (C) and (D) as 
     subparagraphs (D) and (E), respectively; and
       (B) by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Election to extend period.--The plan sponsor of an 
     endangered or seriously endangered plan may elect to extend 
     the applicable funding improvement period by up to 5 years, 
     reduced by any extension of the period previously elected 
     pursuant to section 205 of the Worker, Retiree and Employer 
     Relief Act of 2008. Such an election shall be made not later 
     than June 30, 2011, and in such form and manner as the 
     Secretary of the Treasury may prescribe.''.
       (2) Rehabilitation period.--Section 305(e)(4) of such Act 
     is amended--
       (A) by redesignating subparagraph (B) as subparagraph (C);
       (B) in last sentence of subparagraph (A), by striking 
     ``subparagraph (B)'' each place it appears and inserting 
     ``subparagraph (C)''; and
       (C) by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) Election to extend period.--The plan sponsor of a 
     plan in critical status may elect to extend the 
     rehabilitation period by up to five years, reduced by any 
     extension of the period previously elected pursuant to 
     section 205 of the Worker, Retiree and Employer Relief Act of 
     2008. Such an election shall be made not later than June 30, 
     2011, and in such form and manner as the Secretary of the 
     Treasury may prescribe.''.
       (b) IRC Amendments.--
       (1) Funding improvement period.--Section 432(c)(4) of the 
     Internal Revenue Code of 1986 is amended--
       (A) by redesignating subparagraphs (C) and (D) as 
     subparagraphs (D) and (E), respectively; and
       (B) by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Election to extend period.--The plan sponsor of an 
     endangered or seriously endangered plan may elect to extend 
     the applicable funding improvement period by up to 5 years, 
     reduced by any extension of the period previously elected 
     pursuant to section 205 of the Worker, Retiree and Employer 
     Relief Act of 2008. Such an election shall be made not later 
     than June 30, 2011, and in such form and manner as the 
     Secretary may prescribe.''.
       (2) Rehabilitation period.--Section 432(e)(4) of such Code 
     is amended--

[[Page 10109]]

       (A) by redesignating subparagraph (B) as subparagraph (C);
       (B) in last sentence of subparagraph (A), by striking 
     ``subparagraph (B)'' each place it appears and inserting 
     ``subparagraph (C)''; and
       (C) by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) Election to extend period.--The plan sponsor of a 
     plan in critical status may elect to extend the 
     rehabilitation period by up to five years, reduced by any 
     extension of the period previously elected pursuant to 
     section 205 of the Worker, Retiree and Employer Relief Act of 
     2008. Such an election shall be made not later than June 30, 
     2011, and in such form and manner as the Secretary may 
     prescribe.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply with respect to funding improvement periods and 
     rehabilitation periods in connection with funding improvement 
     plans and rehabilitation plans adopted or updated on or after 
     the date of the enactment of this Act.

     SEC. 313. MODIFICATION OF CERTAIN AMORTIZATION EXTENSIONS 
                   UNDER PRIOR LAW.

       (a) In General.--In the case of an amortization extension 
     that was granted to a multiemployer plan under the terms of 
     section 304 of the Employee Retirement Income Security Act of 
     1974 (as in effect immediately prior to enactment of the 
     Pension Protection Act of 2006) or section 412(e) of the 
     Internal Revenue Code (as so in effect), the determination of 
     whether any financial condition on the amortization extension 
     is satisfied shall be made by assuming that for any plan year 
     that contains some or all of the period beginning June 30, 
     2008, and ending October 31, 2008, the actual rate of return 
     on the plan assets was equal to the interest rate used for 
     purposes of charging or crediting the funding standard 
     account in such plan year, unless the plan sponsor elects 
     otherwise in such form and manner as shall be prescribed by 
     the Secretary of Treasury.
       (b) Revocation of Amortization Extensions.--The plan 
     sponsor of a multiemployer plan may, in such form and manner 
     and after such notice as may be prescribed by the Secretary, 
     revoke any amortization extension described in subsection 
     (a), effective for plan years following the date of the 
     revocation.

     SEC. 314. ALTERNATIVE DEFAULT SCHEDULE FOR PLANS IN 
                   ENDANGERED OR CRITICAL STATUS.

       (a) ERISA Amendments.--
       (1) Endangered status.--Section 305(c)(7) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1085(c)(7)) 
     is amended by adding at the end the following new 
     subparagraph:
       ``(D) Alternative default schedule.--
       ``(i) In general.--A plan sponsor may, for purposes of this 
     paragraph, designate an alternative schedule of contribution 
     rates and related benefit changes meeting the requirements of 
     clause (ii) as the default schedule, in lieu of the default 
     schedule referred to in subparagraph (A).
       ``(ii) Requirements.--An alternative schedule designated 
     pursuant to clause (i) meets the requirements of this clause 
     if such schedule has been adopted in collective bargaining 
     agreements covering at least 75 percent of the active 
     participants as of the date of the designation.''.
       (2) Critical status.--Section 305(e)(3) of such Act (29 
     U.S.C. 1085(e)(3)) is amended by adding at the end the 
     following new subparagraph:
       ``(D) Alternative default schedule.--
       ``(i) In general.--A plan sponsor may, for purposes of 
     subparagraph (C), designate an alternative schedule of 
     contribution rates and related benefit changes meeting the 
     requirements of clause (ii) as the default schedule, in lieu 
     of the default schedule referred to in subparagraph (C)(i).
       ``(ii) Requirements.--An alternative schedule designated 
     pursuant to clause (i) meets the requirements of this clause 
     if such schedule has been adopted in collective bargaining 
     agreements covering at least 75 percent of the active 
     participants as of the date of the designation.''.
       (b) Internal Revenue Code Amendments.--
       (1) Endangered status.--Section 432(c)(7) of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new subparagraph:
       ``(C) Alternative default schedule.--
       ``(i) In general.--A plan sponsor may, for purposes of this 
     paragraph, designate an alternative schedule of contribution 
     rates and related benefit changes meeting the requirements of 
     clause (ii) as the default schedule, in lieu of the default 
     schedule referred to in subparagraph (A).
       ``(ii) Requirements.--An alternative schedule designated 
     pursuant to clause (i) meets the requirements of this clause 
     if such schedule has been adopted in collective bargaining 
     agreements covering at least 75 percent of the active 
     participants as of the date of the designation.''.
       (2) Critical status.--Section 432(e)(3) of such Code is 
     amended by adding at the end the following new subparagraph:
       ``(D) Alternative default schedule.--
       ``(i) In general.--A plan sponsor may, for purposes of 
     subparagraph (C), designate an alternative schedule of 
     contribution rates and related benefit changes meeting the 
     requirements of clause (ii) as the default schedule, in lieu 
     of the default schedule referred to in subparagraph (C)(i).
       ``(ii) Requirements.--An alternative schedule designated 
     pursuant to clause (i) meets the requirements of this clause 
     if such schedule has been adopted in collective bargaining 
     agreements covering at least 75 percent of the active 
     participants as of the date of the designation.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to designations of default schedules by plan 
     sponsors on or after the date of the enactment of this Act.
       (d) Cross-reference.--For sunset of the amendments made by 
     this section, see section 221(c) of the Pension Protection 
     Act of 2006.

     SEC. 315. TRANSITION RULE FOR CERTIFICATIONS OF PLAN STATUS.

       (a) In General.--A plan actuary shall not be treated as 
     failing to meet the requirements of section 305(b)(3)(A) of 
     the Employee Retirement Income Security Act of 1974 and 
     section 432(b)(3)(A) of the Internal Revenue Code of 1986 in 
     connection with a certification required under such sections 
     the deadline for which is after the date of the enactment of 
     this Act if the plan actuary makes such certification at any 
     time earlier than 75 days after the date of the enactment of 
     this Act.
       (b) Revision of Prior Certification.--
       (1) In general.--If--
       (A) a plan sponsor makes an election under section 
     304(b)(8) of the Employee Retirement Income Security Act of 
     1974 and section 431(b)(8) of the Internal Revenue Code of 
     1986, or under section 304(c)(2)(B) of such Act and section 
     432(c)(2)(B) such Code, with respect to a plan for a plan 
     year beginning on or after October 1, 2009; and
       (B) the plan actuary's certification of the plan status for 
     such plan year (hereinafter in this subsection referred to as 
     ``original certification'') did not take into account any 
     election so made,

     then the plan sponsor may direct the plan actuary to make a 
     new certification with respect to the plan for the plan year 
     which takes into account such election (hereinafter in this 
     subsection referred to as ``new certification'') if the 
     plan's status under section 305 of such Act and section 432 
     of such Code would change as a result of such election. Any 
     such new certification shall be treated as the most recent 
     certification referred to in section 304(b)(3)(B)(iii) of 
     such Act and section 431(b)(8)(B)(iii) of such Code.
       (2) Due date for new certification.--Any such new 
     certification shall be made pursuant to section 305(b)(3) of 
     such Act and section 432(b)(3) of such Code; except that any 
     such new certification shall be made not later than 75 days 
     after the date of the enactment of this Act.
       (3) Notice.--
       (A) In general.--Except as provided in subparagraph (B), 
     any such new certification shall be treated as the original 
     certification for purposes of section 305(b)(3)(D) of such 
     Act and section 432(b)(3)(D) of such Code.
       (B) Notice already provided.--In any case in which notice 
     has been provided under such sections with respect to the 
     original certification, not later than 30 days after the new 
     certification is made, the plan sponsor shall provide notice 
     of any change in status under rules similar to the rules such 
     sections.
       (4) Effect of change in status.--If a plan ceases to be in 
     critical status pursuant to the new certification, then the 
     plan shall, not later than 30 days after the due date 
     described in paragraph (2), cease any restriction of benefit 
     payments, and imposition of contribution surcharges, under 
     section 305 of such Act and section 432 of such Code by 
     reason of the original certification.

                       TITLE IV--REVENUE OFFSETS

                     Subtitle A--Foreign Provisions

     SEC. 401. RULES TO PREVENT SPLITTING FOREIGN TAX CREDITS FROM 
                   THE INCOME TO WHICH THEY RELATE.

       (a) In General.--Subpart A of part III of subchapter N of 
     chapter 1 is amended by adding at the end the following new 
     section:

     ``SEC. 909. SUSPENSION OF TAXES AND CREDITS UNTIL RELATED 
                   INCOME TAKEN INTO ACCOUNT.

       ``(a) In General.--If there is a foreign tax credit 
     splitting event with respect to a foreign income tax paid or 
     accrued by the taxpayer, such tax shall not be taken into 
     account for purposes of this title before the taxable year in 
     which the related income is taken into account under this 
     chapter by the taxpayer.
       ``(b) Special Rules With Respect to Section 902 
     Corporations.--If there is a foreign tax credit splitting 
     event with respect to a foreign income tax paid or accrued by 
     a section 902 corporation, such tax shall not be taken into 
     account--
       ``(1) for purposes of section 902 or 960, or
       ``(2) for purposes of determining earnings and profits 
     under section 964(a),
     before the taxable year in which the related income is taken 
     into account under this chapter by such section 902 
     corporation or a domestic corporation which meets the 
     ownership requirements of subsection (a) or (b) of section 
     902 with respect to such section 902 corporation.
       ``(c) Special Rules.--For purposes of this section--
       ``(1) Application to partnerships, etc.--In the case of a 
     partnership, subsections (a)

[[Page 10110]]

     and (b) shall be applied at the partner level. Except as 
     otherwise provided by the Secretary, a rule similar to the 
     rule of the preceding sentence shall apply in the case of any 
     S corporation or trust.
       ``(2) Treatment of foreign taxes after suspension.--In the 
     case of any foreign income tax not taken into account by 
     reason of subsection (a) or (b), except as otherwise provided 
     by the Secretary, such tax shall be so taken into account in 
     the taxable year referred to in such subsection (other than 
     for purposes of section 986(a)) as a foreign income tax paid 
     or accrued in such taxable year.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Foreign tax credit splitting event.--There is a 
     foreign tax credit splitting event with respect to a foreign 
     income tax if the related income is (or will be) taken into 
     account under this chapter by a covered person.
       ``(2) Foreign income tax.--The term `foreign income tax' 
     means any income, war profits, or excess profits tax paid or 
     accrued to any foreign country or to any possession of the 
     United States.
       ``(3) Related income.--The term `related income' means, 
     with respect to any portion of any foreign income tax, the 
     income (or, as appropriate, earnings and profits) to which 
     such portion of foreign income tax relates.
       ``(4) Covered person.--The term `covered person' means, 
     with respect to any person who pays or accrues a foreign 
     income tax (hereafter in this paragraph referred to as the 
     `payor')--
       ``(A) any entity in which the payor holds, directly or 
     indirectly, at least a 10 percent ownership interest 
     (determined by vote or value),
       ``(B) any person which holds, directly or indirectly, at 
     least a 10 percent ownership interest (determined by vote or 
     value) in the payor,
       ``(C) any person which bears a relationship to the payor 
     described in section 267(b) or 707(b), and
       ``(D) any other person specified by the Secretary for 
     purposes of this paragraph.
       ``(5) Section 902 corporation.--The term `section 902 
     corporation' means any foreign corporation with respect to 
     which one or more domestic corporations meets the ownership 
     requirements of subsection (a) or (b) of section 902.
       ``(e) Regulations.--The Secretary may issue such 
     regulations or other guidance as is necessary or appropriate 
     to carry out the purposes of this section, including 
     regulations or other guidance which provides--
       ``(1) appropriate exceptions from the provisions of this 
     section, and
       ``(2) for the proper application of this section with 
     respect to hybrid instruments.''.
       (b) Clerical Amendment.--The table of sections for subpart 
     A of part III of subchapter N of chapter 1 is amended by 
     adding at the end the following new item:

``Sec. 909. Suspension of taxes and credits until related income taken 
              into account.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to--
       (1) foreign income taxes (as defined in section 909(d) of 
     the Internal Revenue Code of 1986, as added by this section) 
     paid or accrued after May 20, 2010; and
       (2) foreign income taxes (as so defined) paid or accrued by 
     a section 902 corporation (as so defined) on or before such 
     date (and not deemed paid under section 902(a) or 960 of such 
     Code on or before such date), but only for purposes of 
     applying sections 902 and 960 with respect to periods after 
     such date.
     Section 909(b)(2) of the Internal Revenue Code of 1986, as 
     added by this section, shall not apply to foreign income 
     taxes described in paragraph (2).

     SEC. 402. DENIAL OF FOREIGN TAX CREDIT WITH RESPECT TO 
                   FOREIGN INCOME NOT SUBJECT TO UNITED STATES 
                   TAXATION BY REASON OF COVERED ASSET 
                   ACQUISITIONS.

       (a) In General.--Section 901 is amended by redesignating 
     subsection (m) as subsection (n) and by inserting after 
     subsection (l) the following new subsection:
       ``(m) Denial of Foreign Tax Credit With Respect to Foreign 
     Income Not Subject to United States Taxation by Reason of 
     Covered Asset Acquisitions.--
       ``(1) In general.--In the case of a covered asset 
     acquisition, the disqualified portion of any foreign income 
     tax determined with respect to the income or gain 
     attributable to the relevant foreign assets--
       ``(A) shall not be taken into account in determining the 
     credit allowed under subsection (a), and
       ``(B) in the case of a foreign income tax paid by a section 
     902 corporation (as defined in section 909(d)(5)), shall not 
     be taken into account for purposes of section 902 or 960.
       ``(2) Covered asset acquisition.--For purposes of this 
     section, the term `covered asset acquisition' means--
       ``(A) a qualified stock purchase (as defined in section 
     338(d)(3)) to which section 338(a) applies,
       ``(B) any transaction which--
       ``(i) is treated as an acquisition of assets for purposes 
     of this chapter, and
       ``(ii) is treated as the acquisition of stock of a 
     corporation (or is disregarded) for purposes of the foreign 
     income taxes of the relevant jurisdiction,
       ``(C) any acquisition of an interest in a partnership which 
     has an election in effect under section 754, and
       ``(D) to the extent provided by the Secretary, any other 
     similar transaction.
       ``(3) Disqualified portion.--For purposes of this section--
       ``(A) In general.--The term `disqualified portion' means, 
     with respect to any covered asset acquisition, for any 
     taxable year, the ratio (expressed as a percentage) of--
       ``(i) the aggregate basis differences (but not below zero) 
     allocable to such taxable year under subparagraph (B) with 
     respect to all relevant foreign assets, divided by
       ``(ii) the income on which the foreign income tax referred 
     to in paragraph (1) is determined (or, if the taxpayer fails 
     to substantiate such income to the satisfaction of the 
     Secretary, such income shall be determined by dividing the 
     amount of such foreign income tax by the highest marginal tax 
     rate applicable to such income in the relevant jurisdiction).
       ``(B) Allocation of basis difference.--For purposes of 
     subparagraph (A)(i)--
       ``(i) In general.--The basis difference with respect to any 
     relevant foreign asset shall be allocated to taxable years 
     using the applicable cost recovery method under this chapter.
       ``(ii) Special rule for disposition of assets.--Except as 
     otherwise provided by the Secretary, in the case of the 
     disposition of any relevant foreign asset--

       ``(I) the basis difference allocated to the taxable year 
     which includes the date of such disposition shall be the 
     excess of the basis difference with respect to such asset 
     over the aggregate basis difference with respect to such 
     asset which has been allocated under clause (i) to all prior 
     taxable years, and
       ``(II) no basis difference with respect to such asset shall 
     be allocated under clause (i) to any taxable year thereafter.

       ``(C) Basis difference.--
       ``(i) In general.--The term `basis difference' means, with 
     respect to any relevant foreign asset, the excess of--

       ``(I) the adjusted basis of such asset immediately after 
     the covered asset acquisition, over
       ``(II) the adjusted basis of such asset immediately before 
     the covered asset acquisition.

       ``(ii) Built-in loss assets.--In the case of a relevant 
     foreign asset with respect to which the amount described in 
     clause (i)(II) exceeds the amount described in clause (i)(I), 
     such excess shall be taken into account under this subsection 
     as a basis difference of a negative amount.
       ``(iii) Special rule for section 338 elections.--In the 
     case of a covered asset acquisition described in paragraph 
     (2)(A), the covered asset acquisition shall be treated for 
     purposes of this subparagraph as occurring at the close of 
     the acquisition date (as defined in section 338(h)(2)).
       ``(4) Relevant foreign assets.--For purposes of this 
     section, the term `relevant foreign asset' means, with 
     respect to any covered asset acquisition, any asset 
     (including any goodwill, going concern value, or other 
     intangible) with respect to such acquisition if income, 
     deduction, gain, or loss attributable to such asset is taken 
     into account in determining the foreign income tax referred 
     to in paragraph (1).
       ``(5) Foreign income tax.--For purposes of this section, 
     the term `foreign income tax' means any income, war profits, 
     or excess profits tax paid or accrued to any foreign country 
     or to any possession of the United States.
       ``(6) Taxes allowed as a deduction, etc.--Sections 275 and 
     78 shall not apply to any tax which is not allowable as a 
     credit under subsection (a) by reason of this subsection.
       ``(7) Regulations.--The Secretary may issue such 
     regulations or other guidance as is necessary or appropriate 
     to carry out the purposes of this subsection, including to 
     exempt from the application of this subsection certain 
     covered asset acquisitions, and relevant foreign assets with 
     respect to which the basis difference is de minimis.''.
       (b) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to covered asset 
     acquisitions (as defined in section 901(m)(2) of the Internal 
     Revenue Code of 1986, as added by this section) after--
       (A) May 20, 2010, if the transferor and the transferee are 
     related; and
       (B) the date of the enactment of this Act in any other 
     case.
       (2) Transition rule.--The amendments made by this section 
     shall not apply to any covered asset acquisition (as so 
     defined) with respect to which the transferor and the 
     transferee are not related if such acquisition is--
       (A) made pursuant to a written agreement which was binding 
     on May 20, 2010, and at all times thereafter,
       (B) described in a ruling request submitted to the Internal 
     Revenue Service on or before such date; or
       (C) described on or before such date in a public 
     announcement or in a filing with the Securities and Exchange 
     Commission.
       (3) Related persons.--For purposes of this subsection, a 
     person shall be treated as related to another person if the 
     relationship between such persons is described in section

[[Page 10111]]

     267 or 707(b) of the Internal Revenue Code of 1986.

     SEC. 403. SEPARATE APPLICATION OF FOREIGN TAX CREDIT 
                   LIMITATION, ETC., TO ITEMS RESOURCED UNDER 
                   TREATIES.

       (a) In General.--Subsection (d) of section 904 is amended 
     by redesignating paragraph (6) as paragraph (7) and by 
     inserting after paragraph (5) the following new paragraph:
       ``(6) Separate application to items resourced under 
     treaties.--
       ``(A) In general.--If--
       ``(i) without regard to any treaty obligation of the United 
     States, any item of income would be treated as derived from 
     sources within the United States,
       ``(ii) under a treaty obligation of the United States, such 
     item would be treated as arising from sources outside the 
     United States, and
       ``(iii) the taxpayer chooses the benefits of such treaty 
     obligation,

     subsections (a), (b), and (c) of this section and sections 
     902, 907, and 960 shall be applied separately with respect to 
     each such item.
       ``(B) Coordination with other provisions.--This paragraph 
     shall not apply to any item of income to which subsection 
     (h)(10) or section 865(h) applies.
       ``(C) Regulations.--The Secretary may issue such 
     regulations or other guidance as is necessary or appropriate 
     to carry out the purposes of this paragraph, including 
     regulations or other guidance which provides that related 
     items of income may be aggregated for purposes of this 
     paragraph.''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after the date of the 
     enactment of this Act.

     SEC. 404. LIMITATION ON THE AMOUNT OF FOREIGN TAXES DEEMED 
                   PAID WITH RESPECT TO SECTION 956 INCLUSIONS.

       (a) In General.--Section 960 is amended by adding at the 
     end the following new subsection:
       ``(c) Limitation With Respect to Section 956 Inclusions.--
       ``(1) In general.--If there is included under section 
     951(a)(1)(B) in the gross income of a domestic corporation 
     any amount attributable to the earnings and profits of a 
     foreign corporation which is a member of a qualified group 
     (as defined in section 902(b)) with respect to the domestic 
     corporation, the amount of any foreign income taxes deemed to 
     have been paid during the taxable year by such domestic 
     corporation under section 902 by reason of subsection (a) 
     with respect to such inclusion in gross income shall not 
     exceed the amount of the foreign income taxes which would 
     have been deemed to have been paid during the taxable year by 
     such domestic corporation if cash in an amount equal to the 
     amount of such inclusion in gross income were distributed as 
     a series of distributions (determined without regard to any 
     foreign taxes which would be imposed on an actual 
     distribution) through the chain of ownership which begins 
     with such foreign corporation and ends with such domestic 
     corporation.
       ``(2) Authority to prevent abuse.--The Secretary shall 
     issue such regulations or other guidance as is necessary or 
     appropriate to carry out the purposes of this subsection, 
     including regulations or other guidance which prevent the 
     inappropriate use of the foreign corporation's foreign income 
     taxes not deemed paid by reason of paragraph (1).''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to acquisitions of United States property (as 
     defined in section 956(c) of the Internal Revenue Code of 
     1986) after May 20, 2010.

     SEC. 405. SPECIAL RULE WITH RESPECT TO CERTAIN REDEMPTIONS BY 
                   FOREIGN SUBSIDIARIES.

       (a) In General.--Paragraph (5) of section 304(b) is amended 
     by redesignating subparagraph (B) as subparagraph (C) and by 
     inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) Special rule in case of foreign acquiring 
     corporation.--In the case of any acquisition to which 
     subsection (a) applies in which the acquiring corporation is 
     a foreign corporation, no earnings and profits shall be taken 
     into account under paragraph (2)(A) (and subparagraph (A) 
     shall not apply) if more than 50 percent of the dividends 
     arising from such acquisition (determined without regard to 
     this subparagraph) would not--
       ``(i) be subject to tax under this chapter for the taxable 
     year in which the dividends arise, or
       ``(ii) be includible in the earnings and profits of a 
     controlled foreign corporation (as defined in section 957 and 
     without regard to section 953(c)).''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to acquisitions after May 20, 2010.

     SEC. 406. MODIFICATION OF AFFILIATION RULES FOR PURPOSES OF 
                   RULES ALLOCATING INTEREST EXPENSE.

       (a) In General.--Subparagraph (A) of section 864(e)(5) is 
     amended by adding at the end the following: ``Notwithstanding 
     the preceding sentence, a foreign corporation shall be 
     treated as a member of the affiliated group if--
       ``(i) more than 50 percent of the gross income of such 
     foreign corporation for the taxable year is effectively 
     connected with the conduct of a trade or business within the 
     United States, and
       ``(ii) at least 80 percent of either the vote or value of 
     all outstanding stock of such foreign corporation is owned 
     directly or indirectly by members of the affiliated group 
     (determined with regard to this sentence).''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after the date of the 
     enactment of this Act.

     SEC. 407. TERMINATION OF SPECIAL RULES FOR INTEREST AND 
                   DIVIDENDS RECEIVED FROM PERSONS MEETING THE 80-
                   PERCENT FOREIGN BUSINESS REQUIREMENTS.

       (a) In General.--Paragraph (1) of section 861(a) is amended 
     by striking subparagraph (A) and by redesignating 
     subparagraphs (B) and (C) as subparagraphs (A) and (B), 
     respectively.
       (b) Grandfather Rule With Respect to Withholding on 
     Interest and Dividends Received From Persons Meeting the 80-
     percent Foreign Business Requirements.--
       (1) In general.--Subparagraph (B) of section 871(i)(2) is 
     amended to read as follows:
       ``(B) The active foreign business percentage of--
       ``(i) any dividend paid by an existing 80/20 company, and
       ``(ii) any interest paid by an existing 80/20 company.''.
       (2) Definitions and special rules.--Section 871 is amended 
     by redesignating subsections (l) and (m) as subsections (m) 
     and (n), respectively, and by inserting after subsection (k) 
     the following new subsection:
       ``(l) Rules Relating to Existing 80/20 Companies.--For 
     purposes of this subsection and subsection (i)(2)(B)--
       ``(1) Existing 80/20 company.--
       ``(A) In general.--The term `existing 80/20 company' means 
     any corporation if--
       ``(i) such corporation met the 80-percent foreign business 
     requirements of section 861(c)(1) (as in effect before the 
     enactment of this subsection) for such corporation's last 
     taxable year beginning before January 1, 2011,
       ``(ii) such corporation meets the 80-percent foreign 
     business requirements of subparagraph (B) with respect to 
     each taxable year after the taxable year referred to in 
     clause (i), and
       ``(iii) there has not been an addition of a substantial 
     line of business with respect to such corporation after the 
     date of the enactment of this subsection.
       ``(B) Foreign business requirements.--
       ``(i) In general.--A corporation meets the 80-percent 
     foreign business requirements of this subparagraph if it is 
     shown to the satisfaction of the Secretary that at least 80 
     percent of the gross income from all sources of such 
     corporation for the testing period is active foreign business 
     income.
       ``(ii) Active foreign business income.--For purposes of 
     clause (i), the term `active foreign business income' means 
     gross income which--

       ``(I) is derived from sources outside the United States (as 
     determined under this subchapter), and
       ``(II) is attributable to the active conduct of a trade or 
     business in a foreign country or possession of the United 
     States.

       ``(iii) Testing period.--For purposes of this subsection, 
     the term `testing period' means the 3-year period ending with 
     the close of the taxable year of the corporation preceding 
     the payment (or such part of such period as may be 
     applicable). If the corporation has no gross income for such 
     3-year period (or part thereof), the testing period shall be 
     the taxable year in which the payment is made.
       ``(2) Active foreign business percentage.--The term `active 
     foreign business percentage' means, with respect to any 
     existing 80/20 company, the percentage which--
       ``(A) the active foreign business income of such company 
     for the testing period, is of
       ``(B) the gross income of such company for the testing 
     period from all sources.
       ``(3) Aggregation rules.--For purposes of applying 
     paragraph (1) (other than subparagraph (A)(i) thereof) and 
     paragraph (2)--
       ``(A) In general.--The corporation referred to in paragraph 
     (1)(A) and all of such corporation's subsidiaries shall be 
     treated as one corporation.
       ``(B) Subsidiaries.--For purposes of subparagraph (A), the 
     term `subsidiary' means any corporation in which the 
     corporation referred to in subparagraph (A) owns (directly or 
     indirectly) stock meeting the requirements of section 
     1504(a)(2) (determined by substituting `50 percent' for `80 
     percent' each place it appears and without regard to section 
     1504(b)(3)).
       ``(4) Regulations.--The Secretary may issue such 
     regulations or other guidance as is necessary or appropriate 
     to carry out the purposes of this section, including 
     regulations or other guidance which provide for the proper 
     application of the aggregation rules described in paragraph 
     (3).''.
       (c) Conforming Amendments.--
       (1) Section 861 is amended by striking subsection (c) and 
     by redesignating subsections (d), (e), and (f) as subsections 
     (c), (d), and (e), respectively.
       (2) Paragraph (9) of section 904(h) is amended to read as 
     follows:
       ``(9) Treatment of certain domestic corporations.--In the 
     case of any dividend treated as not from sources within the

[[Page 10112]]

     United States under section 861(a)(2)(A), the corporation 
     paying such dividend shall be treated for purposes of this 
     subsection as a United States-owned foreign corporation.''.
       (3) Subsection (c) of section 2104 is amended in the last 
     sentence by striking ``or to a debt obligation of a domestic 
     corporation'' and all that follows and inserting a period.
       (d) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 2010.
       (2) Grandfather rule for outstanding debt obligations.--
       (A) In general.--The amendments made by this section shall 
     not apply to payments of interest on obligations issued 
     before the date of the enactment of this Act.
       (B) Exception for related party debt.--Subparagraph (A) 
     shall not apply to any interest which is payable to a related 
     person (determined under rules similar to the rules of 
     section 954(d)(3)).
       (C) Significant modifications treated as new issues.--For 
     purposes of subparagraph (A), a significant modification of 
     the terms of any obligation (including any extension of the 
     term of such obligation) shall be treated as a new issue.

     SEC. 408. SOURCE RULES FOR INCOME ON GUARANTEES.

       (a) Amounts Sourced Within the United States.--Subsection 
     (a) of section 861 is amended by adding at the end the 
     following new paragraph:
       ``(9) Guarantees.--Amounts--
       ``(A) received with respect to a guarantee of an obligation 
     of a noncorporate resident or domestic corporation, and
       ``(B) paid by any foreign person with respect to guarantees 
     if such amount is connected with income which is effectively 
     connected (or treated as effectively connected) with the 
     conduct of a trade or business in the United States.''.
       (b) Amounts Sourced Without the United States.--Subsection 
     (a) of section 862 is amended by striking ``and'' at the end 
     of paragraph (7), by striking the period at the end of 
     paragraph (8) and inserting ``; and'', and by adding at the 
     end the following new paragraph:
       ``(9) amounts received with respect to guarantees other 
     than those derived from sources within the United States as 
     provided in section 861(a)(9).''.
       (c) Conforming Amendment.--Clause (ii) of section 
     864(c)(4)(B) is amended by striking ``dividends or interest'' 
     and inserting ``dividends, interest, or amounts with respect 
     to guarantees''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to guarantees issued after the date of the 
     enactment of this Act.

     SEC. 409. LIMITATION ON EXTENSION OF STATUTE OF LIMITATIONS 
                   FOR FAILURE TO NOTIFY SECRETARY OF CERTAIN 
                   FOREIGN TRANSFERS.

       (a) In General.--Paragraph (8) of section 6501(c) is 
     amended--
       (1) by striking ``In the case of any information'' and 
     inserting the following:
       ``(A) In general.--In the case of any information''; and
       (2) by adding at the end the following:
       ``(B) Application to failures due to reasonable cause.--If 
     the failure to furnish the information referred to in 
     subparagraph (A) is due to reasonable cause and not willful 
     neglect, subparagraph (A) shall apply only to the item or 
     items related to such failure.''.
       (b) Effective Date.--The amendments made by this section 
     shall take effect as if included in section 513 of the Hiring 
     Incentives to Restore Employment Act.

    Subtitle B--Personal Service Income Earned in Pass-thru Entities

     SEC. 411. PARTNERSHIP INTERESTS TRANSFERRED IN CONNECTION 
                   WITH PERFORMANCE OF SERVICES.

       (a) Modification to Election To Include Partnership 
     Interest in Gross Income in Year of Transfer.--Subsection (c) 
     of section 83 is amended by redesignating paragraph (4) as 
     paragraph (5) and by inserting after paragraph (3) the 
     following new paragraph:
       ``(4) Partnership interests.--Except as provided by the 
     Secretary, in the case of any transfer of an interest in a 
     partnership in connection with the provision of services to 
     (or for the benefit of) such partnership--
       ``(A) the fair market value of such interest shall be 
     treated for purposes of this section as being equal to the 
     amount of the distribution which the partner would receive if 
     the partnership sold (at the time of the transfer) all of its 
     assets at fair market value and distributed the proceeds of 
     such sale (reduced by the liabilities of the partnership) to 
     its partners in liquidation of the partnership, and
       ``(B) the person receiving such interest shall be treated 
     as having made the election under subsection (b)(1) unless 
     such person makes an election under this paragraph to have 
     such subsection not apply.''.
       (b) Conforming Amendment.--Paragraph (2) of section 83(b) 
     is amended by inserting ``or subsection (c)(4)(B)'' after 
     ``paragraph (1)''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to interests in partnerships transferred after 
     the date of the enactment of this Act.

     SEC. 412. INCOME OF PARTNERS FOR PERFORMING INVESTMENT 
                   MANAGEMENT SERVICES TREATED AS ORDINARY INCOME 
                   RECEIVED FOR PERFORMANCE OF SERVICES.

       (a) In General.--Part I of subchapter K of chapter 1 is 
     amended by adding at the end the following new section:

     ``SEC. 710. SPECIAL RULES FOR PARTNERS PROVIDING INVESTMENT 
                   MANAGEMENT SERVICES TO PARTNERSHIP.

       ``(a) Treatment of Distributive Share of Partnership 
     Items.--For purposes of this title, in the case of an 
     investment services partnership interest--
       ``(1) In general.--Notwithstanding section 702(b)--
       ``(A) any net income with respect to such interest for any 
     partnership taxable year shall be treated as ordinary income, 
     and
       ``(B) any net loss with respect to such interest for such 
     year, to the extent not disallowed under paragraph (2) for 
     such year, shall be treated as an ordinary loss.

     All items of income, gain, deduction, and loss which are 
     taken into account in computing net income or net loss shall 
     be treated as ordinary income or ordinary loss (as the case 
     may be).
       ``(2) Treatment of losses.--
       ``(A) Limitation.--Any net loss with respect to such 
     interest shall be allowed for any partnership taxable year 
     only to the extent that such loss does not exceed the excess 
     (if any) of--
       ``(i) the aggregate net income with respect to such 
     interest for all prior partnership taxable years, over
       ``(ii) the aggregate net loss with respect to such interest 
     not disallowed under this subparagraph for all prior 
     partnership taxable years.
       ``(B) Carryforward.--Any net loss for any partnership 
     taxable year which is not allowed by reason of subparagraph 
     (A) shall be treated as an item of loss with respect to such 
     partnership interest for the succeeding partnership taxable 
     year.
       ``(C) Basis adjustment.--No adjustment to the basis of a 
     partnership interest shall be made on account of any net loss 
     which is not allowed by reason of subparagraph (A).
       ``(D) Prior partnership years.--Any reference in this 
     paragraph to prior partnership taxable years shall only 
     include prior partnership taxable years to which this section 
     applies.
       ``(3) Net income and loss.--For purposes of this section--
       ``(A) Net income.--The term `net income' means, with 
     respect to any investment services partnership interest for 
     any partnership taxable year, the excess (if any) of--
       ``(i) all items of income and gain taken into account by 
     the holder of such interest under section 702 with respect to 
     such interest for such year, over
       ``(ii) all items of deduction and loss so taken into 
     account.
       ``(B) Net loss.--The term `net loss' means, with respect to 
     such interest for such year, the excess (if any) of the 
     amount described in subparagraph (A)(ii) over the amount 
     described in subparagraph (A)(i).
       ``(4) Special rule for dividends.--Any dividend taken into 
     account in determining net income or net loss for purposes of 
     paragraph (1) shall not be treated as qualified dividend 
     income for purposes of section 1(h).
       ``(b) Dispositions of Partnership Interests.--
       ``(1) Gain.--Any gain on the disposition of an investment 
     services partnership interest shall be--
       ``(A) treated as ordinary income, and
       ``(B) recognized notwithstanding any other provision of 
     this subtitle.
       ``(2) Loss.--Any loss on the disposition of an investment 
     services partnership interest shall be treated as an ordinary 
     loss to the extent of the excess (if any) of--
       ``(A) the aggregate net income with respect to such 
     interest for all partnership taxable years to which this 
     section applies, over
       ``(B) the aggregate net loss with respect to such interest 
     allowed under subsection (a)(2) for all partnership taxable 
     years to which this section applies.
       ``(3) Exception for certain dispositions of interests in a 
     publicly traded partnership.--
       ``(A) In general.--Paragraphs (1), (2), and (7) shall not 
     apply in the case of an applicable disposition of an 
     investment services partnership interest which is an interest 
     in a publicly traded partnership (as defined in section 7704) 
     if--
       ``(i) in the case of a disposition described in 
     subparagraph (C)(i), neither the individual nor any member of 
     such individual's family (within the meaning of section 
     318(a)(1)), or
       ``(ii) in the case of a disposition described in 
     subparagraph (C)(ii), neither the regulated investment 
     company or real estate investment trust (nor any person 
     related (within the meaning of section 267(b)) to such 
     company),

     has (at any time) provided (directly or indirectly through a 
     partnership, S corporation, estate or trust) any of the 
     services described in subsection (c)(1) with respect to 
     assets held (directly or indirectly) by such publicly traded 
     partnership.
       ``(B) Limitation on application of section.--This paragraph 
     shall apply to an interest in a publicly traded partnership 
     (as

[[Page 10113]]

     defined in section 7704) only if substantially all of such 
     partnership's gross income consists of those items described 
     in paragraph (1)(E) (or so much of paragraph (1)(F) as 
     relates to paragraph (1)(E)) of section 7704.
       ``(C) Applicable disposition.--For purposes of this 
     paragraph, the term `applicable disposition' means a 
     disposition (directly or indirectly through a partnership, S 
     corporation, estate or trust) by--
       ``(i) an individual, or
       ``(ii) either--

       ``(I) a regulated investment company other than a regulated 
     investment company treated as closely held (within the 
     meaning of section 856(h)(1)), or
       ``(II) except as provided by the Secretary, a real estate 
     investment trust.

       ``(4) Election with respect to certain exchanges.--
     Paragraph (1)(B) shall not apply to the contribution of an 
     investment services partnership interest to a partnership in 
     exchange for an interest in such partnership if--
       ``(A) the taxpayer makes an irrevocable election to treat 
     the partnership interest received in the exchange as an 
     investment services partnership interest, and
       ``(B) the taxpayer agrees to comply with such reporting and 
     recordkeeping requirements as the Secretary may prescribe.
       ``(5) Disposition of portion of interest.--In the case of 
     any disposition of an investment services partnership 
     interest, the amount of net loss which otherwise would have 
     (but for subsection (a)(2)(C)) applied to reduce the basis of 
     such interest shall be disregarded for purposes of this 
     section for all succeeding partnership taxable years.
       ``(6) Distributions of partnership property.--In the case 
     of any distribution of property by a partnership with respect 
     to any investment services partnership interest held by a 
     partner--
       ``(A) the excess (if any) of--
       ``(i) the fair market value of such property at the time of 
     such distribution, over
       ``(ii) the adjusted basis of such property in the hands of 
     the partnership,

     shall be taken into account as an increase in such partner's 
     distributive share of the taxable income of the partnership 
     (except to the extent such excess is otherwise taken into 
     account in determining the taxable income of the 
     partnership),
       ``(B) such property shall be treated for purposes of 
     subpart B of part II as money distributed to such partner in 
     an amount equal to such fair market value, and
       ``(C) the basis of such property in the hands of such 
     partner shall be such fair market value.

     Subsection (b) of section 734 shall be applied without regard 
     to the preceding sentence. In the case of a taxpayer which 
     satisfies requirements similar to the requirements of 
     subparagraphs (A) and (B) of paragraph (4), this paragraph 
     and paragraph (1)(B) shall not apply to the distribution of a 
     partnership interest if such distribution is in connection 
     with a contribution (or deemed contribution) of any property 
     of the partnership to which section 721 applies pursuant to a 
     transaction described in paragraph (1)(B) or (2) of section 
     708(b).
       ``(7) Application of section 751.--In applying section 751, 
     an investment services partnership interest shall be treated 
     as an inventory item.
       ``(c) Investment Services Partnership Interest.--For 
     purposes of this section--
       ``(1) In general.--The term `investment services 
     partnership interest' means any interest in a partnership 
     which is held (directly or indirectly) by any person if it 
     was reasonably expected (at the time that such person 
     acquired such interest) that such person (or any person 
     related to such person) would provide (directly or 
     indirectly) a substantial quantity of any of the following 
     services with respect to assets held (directly or indirectly) 
     by the partnership:
       ``(A) Advising as to the advisability of investing in, 
     purchasing, or selling any specified asset.
       ``(B) Managing, acquiring, or disposing of any specified 
     asset.
       ``(C) Arranging financing with respect to acquiring 
     specified assets.
       ``(D) Any activity in support of any service described in 
     subparagraphs (A) through (C).
       ``(2) Specified asset.--The term `specified asset' means 
     securities (as defined in section 475(c)(2) without regard to 
     the last sentence thereof), real estate held for rental or 
     investment, interests in partnerships, commodities (as 
     defined in section 475(e)(2)), or options or derivative 
     contracts with respect to any of the foregoing.
       ``(3) Exception for family farms.--The term `specified 
     asset' shall not include any farm used for farming purposes 
     if such farm is held by a partnership all of the interests in 
     which are held (directly or indirectly) by members of the 
     same family. Terms used in the preceding sentence which are 
     also used in section 2032A shall have the same meaning as 
     when used in such section.
       ``(4) Related persons.--A person shall be treated as 
     related to another person if the relationship between such 
     persons is described in section 267 or 707(b).
       ``(d) Exception for Certain Capital Interests.--
       ``(1) In general.--In the case of any portion of an 
     investment services partnership interest which is a qualified 
     capital interest, all items of income, gain, loss, and 
     deduction which are allocated to such qualified capital 
     interest shall not be taken into account under subsection (a) 
     if--
       ``(A) allocations of items are made by the partnership to 
     such qualified capital interest in the same manner as such 
     allocations are made to other qualified capital interests 
     held by partners who do not provide any services described in 
     subsection (c)(1) and who are not related to the partner 
     holding the qualified capital interest, and
       ``(B) the allocations made to such other interests are 
     significant compared to the allocations made to such 
     qualified capital interest.
       ``(2) Authority to provide exceptions to allocation 
     requirements.--To the extent provided by the Secretary in 
     regulations or other guidance--
       ``(A) Allocations to portion of qualified capital 
     interest.--Paragraph (1) may be applied separately with 
     respect to a portion of a qualified capital interest.
       ``(B) No or insignificant allocations to nonservice 
     providers.--In any case in which the requirements of 
     paragraph (1)(B) are not satisfied, items of income, gain, 
     loss, and deduction shall not be taken into account under 
     subsection (a) to the extent that such items are properly 
     allocable under such regulations or other guidance to 
     qualified capital interests.
       ``(C) Allocations to service providers' qualified capital 
     interests which are less than other allocations.--Allocations 
     shall not be treated as failing to meet the requirement of 
     paragraph (1)(A) merely because the allocations to the 
     qualified capital interest represent a lower return than the 
     allocations made to the other qualified capital interests 
     referred to in such paragraph.
       ``(3) Special rule for changes in services.--In the case of 
     an interest in a partnership which is not an investment 
     services partnership interest and which, by reason of a 
     change in the services with respect to assets held (directly 
     or indirectly) by the partnership, would (without regard to 
     the reasonable expectation exception of subsection (c)(1)) 
     have become such an interest--
       ``(A) notwithstanding subsection (c)(1), such interest 
     shall be treated as an investment services partnership 
     interest as of the time of such change, and
       ``(B) for purposes of this subsection, the qualified 
     capital interest of the holder of such partnership interest 
     immediately after such change shall not be less than the fair 
     market value of such interest (determined immediately before 
     such change).
       ``(4) Special rule for tiered partnerships.--Except as 
     otherwise provided by the Secretary, in the case of tiered 
     partnerships, all items which are allocated in a manner which 
     meets the requirements of paragraph (1) to qualified capital 
     interests in a lower-tier partnership shall retain such 
     character to the extent allocated on the basis of qualified 
     capital interests in any upper-tier partnership.
       ``(5) Exception for no-self-charged carry and management 
     fee provisions.--Except as otherwise provided by the 
     Secretary, an interest shall not fail to be treated as 
     satisfying the requirement of paragraph (1)(A) merely because 
     the allocations made by the partnership to such interest do 
     not reflect the cost of services described in subsection 
     (c)(1) which are provided (directly or indirectly) to the 
     partnership by the holder of such interest (or a related 
     person).
       ``(6) Special rule for dispositions.--In the case of any 
     investment services partnership interest any portion of which 
     is a qualified capital interest, subsection (b) shall not 
     apply to so much of any gain or loss as bears the same 
     proportion to the entire amount of such gain or loss as--
       ``(A) the distributive share of gain or loss that would 
     have been allocated to the qualified capital interest 
     (consistent with the requirements of paragraph (1)) if the 
     partnership had sold all of its assets at fair market value 
     immediately before the disposition, bears to
       ``(B) the distributive share of gain or loss that would 
     have been so allocated to the investment services partnership 
     interest of which such qualified capital interest is a part.
       ``(7) Qualified capital interest.--For purposes of this 
     subsection--
       ``(A) In general.--The term `qualified capital interest' 
     means so much of a partner's interest in the capital of the 
     partnership as is attributable to--
       ``(i) the fair market value of any money or other property 
     contributed to the partnership in exchange for such interest 
     (determined without regard to section 752(a)),
       ``(ii) any amounts which have been included in gross income 
     under section 83 with respect to the transfer of such 
     interest, and
       ``(iii) the excess (if any) of--

       ``(I) any items of income and gain taken into account under 
     section 702 with respect to such interest, over
       ``(II) any items of deduction and loss so taken into 
     account.

       ``(B) Adjustment to qualified capital interest.--
       ``(i) Distributions and losses.--The qualified capital 
     interest shall be reduced by distributions from the 
     partnership with respect to such interest and by the excess 
     (if any) of

[[Page 10114]]

     the amount described in subparagraph (A)(iii)(II) over the 
     amount described in subparagraph (A)(iii)(I).
       ``(ii) Special rule for contributions of property.--In the 
     case of any contribution of property described in 
     subparagraph (A)(i) with respect to which the fair market 
     value of such property is not equal to the adjusted basis of 
     such property immediately before such contribution, proper 
     adjustments shall be made to the qualified capital interest 
     to take into account such difference consistent with such 
     regulations or other guidance as the Secretary may provide.
       ``(8) Treatment of certain loans.--
       ``(A) Proceeds of partnership loans not treated as 
     qualified capital interest of service providing partners.--
     For purposes of this subsection, an investment services 
     partnership interest shall not be treated as a qualified 
     capital interest to the extent that such interest is acquired 
     in connection with the proceeds of any loan or other advance 
     made or guaranteed, directly or indirectly, by any other 
     partner or the partnership (or any person related to any such 
     other partner or the partnership).
       ``(B) Reduction in allocations to qualified capital 
     interests for loans from nonservice providing partners to the 
     partnership.--For purposes of this subsection, any loan or 
     other advance to the partnership made or guaranteed, directly 
     or indirectly, by a partner not providing services described 
     in subsection (c)(1) to the partnership (or any person 
     related to such partner) shall be taken into account in 
     determining the qualified capital interests of the partners 
     in the partnership.
       ``(e) Other Income and Gain in Connection With Investment 
     Management Services.--
       ``(1) In general.--If--
       ``(A) a person performs (directly or indirectly) investment 
     management services for any entity,
       ``(B) such person holds (directly or indirectly) a 
     disqualified interest with respect to such entity, and
       ``(C) the value of such interest (or payments thereunder) 
     is substantially related to the amount of income or gain 
     (whether or not realized) from the assets with respect to 
     which the investment management services are performed,

     any income or gain with respect to such interest shall be 
     treated as ordinary income. Rules similar to the rules of 
     subsections (a)(4) and (d) shall apply for purposes of this 
     subsection.
       ``(2) Definitions.--For purposes of this subsection--
       ``(A) Disqualified interest.--
       ``(i) In general.--The term `disqualified interest' means, 
     with respect to any entity--

       ``(I) any interest in such entity other than indebtedness,
       ``(II) convertible or contingent debt of such entity,
       ``(III) any option or other right to acquire property 
     described in subclause (I) or (II), and
       ``(IV) any derivative instrument entered into (directly or 
     indirectly) with such entity or any investor in such entity.

       ``(ii) Exceptions.--Such term shall not include--

       ``(I) a partnership interest,
       ``(II) except as provided by the Secretary, any interest in 
     a taxable corporation, and
       ``(III) except as provided by the Secretary, stock in an S 
     corporation.

       ``(B) Taxable corporation.--The term `taxable corporation' 
     means--
       ``(i) a domestic C corporation, or
       ``(ii) a foreign corporation substantially all of the 
     income of which is--

       ``(I) effectively connected with the conduct of a trade or 
     business in the United States, or
       ``(II) subject to a comprehensive foreign income tax (as 
     defined in section 457A(d)(2)).

       ``(C) Investment management services.--The term `investment 
     management services' means a substantial quantity of any of 
     the services described in subsection (c)(1).
       ``(f) Regulations.--The Secretary shall prescribe such 
     regulations or other guidance as is necessary or appropriate 
     to carry out the purposes of this section, including 
     regulations or other guidance to--
       ``(1) provide modifications to the application of this 
     section (including treating related persons as not related to 
     one another) to the extent such modification is consistent 
     with the purposes of this section,
       ``(2) prevent the avoidance of the purposes of this 
     section, and
       ``(3) coordinate this section with the other provisions of 
     this title.
       ``(g) Special Rules for Individuals.--In the case of an 
     individual--
       ``(1) In general.--Subsection (a)(1) shall apply only to 
     the applicable percentage of the net income or net loss 
     referred to in such subsection.
       ``(2) Dispositions, etc.--The amount which (but for this 
     paragraph) would be treated as ordinary income by reason of 
     subsection (b) or (e) shall be the applicable percentage of 
     such amount.
       ``(3) Pro rata allocation to items.--For purposes of 
     applying subsections (a) and (e), the aggregate amount 
     treated as ordinary income for any such taxable year shall be 
     allocated ratably among the items of income, gain, loss, and 
     deduction taken into account in determining such amount.
       ``(4) Special rule for recognition of gain.--Gain which 
     (but for this section) would not be recognized shall be 
     recognized by reason of subsection (b) only to the extent 
     that such gain is treated as ordinary income after 
     application of paragraph (2).
       ``(5) Coordination with limitation on losses.--For purposes 
     of applying paragraph (2) of subsection (a) with respect to 
     any net loss for any taxable year--
       ``(A) such paragraph shall only apply with respect to the 
     applicable percentage of such net loss for such taxable year,
       ``(B) in the case of a prior partnership taxable year 
     referred to in clause (i) or (ii) of subparagraph (A) of such 
     paragraph, only the applicable percentage (as in effect for 
     such prior taxable year) of net income or net loss for such 
     prior partnership taxable year shall be taken into account, 
     and
       ``(C) any net loss carried forward to the succeeding 
     partnership taxable year under subparagraph (B) of such 
     paragraph shall--
       ``(i) be taken into account in such succeeding year without 
     reduction under this subsection, and
       ``(ii) in lieu of being taken into account as an item of 
     loss in such succeeding year, shall be taken into account--

       ``(I) as an increase in net loss or as a reduction in net 
     income (including below zero), as the case may be, and
       ``(II) after any reduction in the amount of such net loss 
     or net income under this subsection.

     A rule similar to the rule of the preceding sentence shall 
     apply for purposes of subsection (b)(2)(A).
       ``(6) Coordination with treatment of dividends.--Subsection 
     (a)(4) shall only apply to the applicable percentage of 
     dividends described therein.
       ``(7) Applicable percentage.--For purposes of this 
     subsection--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the term `applicable percentage' means 65 percent (50 percent 
     in the case of any taxable year beginning before January 1, 
     2013).
       ``(B) Exceptions for sales of assets held at least 7 
     years.--In the case of any taxable year beginning after 
     December 31, 2012, the applicable percentage shall be 55 
     percent with respect to any net income or net loss under 
     subsection (a)(1), or any income or gain under subsection 
     (e), which is properly allocable to gain or loss from the 
     sale or exchange of any asset which is held at least 7 years.
       ``(h) Cross Reference.--For 40 percent penalty on certain 
     underpayments due to the avoidance of this section, see 
     section 6662.''.
       (b) Treatment for Purposes of Section 7704.--Subsection (d) 
     of section 7704 is amended by adding at the end the following 
     new paragraph:
       ``(6) Income from investment services partnership interests 
     not qualified.--
       ``(A) In general.--Items of income and gain shall not be 
     treated as qualifying income if such items are treated as 
     ordinary income by reason of the application of section 710 
     (relating to special rules for partners providing investment 
     management services to partnership). The preceding sentence 
     shall not apply to any item described in paragraph (1)(E) (or 
     so much of paragraph (1)(F) as relates to paragraph (1)(E)).
       ``(B) Special rules for certain partnerships.--
       ``(i) Certain partnerships owned by real estate investment 
     trusts.--Subparagraph (A) shall not apply in the case of a 
     partnership which meets each of the following requirements:

       ``(I) Such partnership is treated as publicly traded under 
     this section solely by reason of interests in such 
     partnership being convertible into interests in a real estate 
     investment trust which is publicly traded.
       ``(II) 50 percent or more of the capital and profits 
     interests of such partnership are owned, directly or 
     indirectly, at all times during the taxable year by such real 
     estate investment trust (determined with the application of 
     section 267(c)).
       ``(III) Such partnership meets the requirements of 
     paragraphs (2), (3), and (4) of section 856(c).

       ``(ii) Certain partnerships owning other publicly traded 
     partnerships.--Subparagraph (A) shall not apply in the case 
     of a partnership which meets each of the following 
     requirements:

       ``(I) Substantially all of the assets of such partnership 
     consist of interests in one or more publicly traded 
     partnerships (determined without regard to subsection 
     (b)(2)).
       ``(II) Substantially all of the income of such partnership 
     is ordinary income or section 1231 gain (as defined in 
     section 1231(a)(3)).

       ``(C) Transitional rule.--Subparagraph (A) shall not apply 
     to any taxable year of the partnership beginning before the 
     date which is 10 years after the date of the enactment of 
     this paragraph.''.
       (c) Imposition of Penalty on Underpayments.--
       (1) In general.--Subsection (b) of section 6662 is amended 
     by inserting after paragraph (7) the following new paragraph:
       ``(8) The application of subsection (e) of section 710 or 
     the regulations prescribed under section 710(f) to prevent 
     the avoidance of the purposes of section 710.''.

[[Page 10115]]

       (2) Amount of penalty.--
       (A) In general.--Section 6662 is amended by adding at the 
     end the following new subsection:
       ``(k) Increase in Penalty in Case of Property Transferred 
     for Investment Management Services.--In the case of any 
     portion of an underpayment to which this section applies by 
     reason of subsection (b)(8), subsection (a) shall be applied 
     with respect to such portion by substituting `40 percent' for 
     `20 percent'.''.
       (B) Conforming amendment.--Subparagraph (B) of section 
     6662A(e)(2) is amended by striking ``or (i)'' and inserting 
     ``, (i), or (k)''.
       (3) Special rules for application of reasonable cause 
     exception.--Subsection (c) of section 6664 is amended--
       (A) by redesignating paragraphs (3) and (4) as paragraphs 
     (4) and (5), respectively;
       (B) by striking ``paragraph (3)'' in paragraph (5)(A), as 
     so redesignated, and inserting ``paragraph (4)''; and
       (C) by inserting after paragraph (2) the following new 
     paragraph:
       ``(3) Special rule for underpayments attributable to 
     investment management services.--
       ``(A) In general.--Paragraph (1) shall not apply to any 
     portion of an underpayment to which this section applies by 
     reason of subsection (b)(8) unless--
       ``(i) the relevant facts affecting the tax treatment of the 
     item are adequately disclosed,
       ``(ii) there is or was substantial authority for such 
     treatment, and
       ``(iii) the taxpayer reasonably believed that such 
     treatment was more likely than not the proper treatment.
       ``(B) Rules relating to reasonable belief.--Rules similar 
     to the rules of subsection (d)(3) shall apply for purposes of 
     subparagraph (A)(iii).''.
       (d) Income and Loss From Investment Services Partnership 
     Interests Taken Into Account in Determining Net Earnings From 
     Self-Employment.--
       (1) Internal revenue code.--Section 1402(a) is amended by 
     striking ``and'' at the end of paragraph (16), by striking 
     the period at the end of paragraph (17) and inserting ``; 
     and'', and by inserting after paragraph (17) the following 
     new paragraph:
       ``(18) notwithstanding the preceding provisions of this 
     subsection, in the case of any individual engaged in the 
     trade or business of providing services described in section 
     710(c)(1) with respect to any entity, any amount treated as 
     ordinary income or ordinary loss of such individual under 
     section 710 with respect to such entity shall be taken into 
     account in determining the net earnings from self-employment 
     of such individual.''.
       (2) Social security act.--Section 211(a) of the Social 
     Security Act is amended by striking ``and'' at the end of 
     paragraph (15), by striking the period at the end of 
     paragraph (16) and inserting ``; and'', and by inserting 
     after paragraph (16) the following new paragraph:
       ``(17) Notwithstanding the preceding provisions of this 
     subsection, in the case of any individual engaged in the 
     trade or business of providing services described in section 
     710(c)(1) of the Internal Revenue Code of 1986 with respect 
     to any entity, any amount treated as ordinary income or 
     ordinary loss of such individual under section 710 of such 
     Code with respect to such entity shall be taken into account 
     in determining the net earnings from self-employment of such 
     individual.''.
       (e) Conforming Amendments.--
       (1) Subsection (d) of section 731 is amended by inserting 
     ``section 710(b)(4) (relating to distributions of partnership 
     property),'' after ``to the extent otherwise provided by''.
       (2) Section 741 is amended by inserting ``or section 710 
     (relating to special rules for partners providing investment 
     management services to partnership)'' before the period at 
     the end.
       (3) The table of sections for part I of subchapter K of 
     chapter 1 is amended by adding at the end the following new 
     item:

``Sec. 710. Special rules for partners providing investment management 
              services to partnership.''.

       (f) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to taxable years ending after December 31, 2010.
       (2) Partnership taxable years which include effective 
     date.--In applying section 710(a) of the Internal Revenue 
     Code of 1986 (as added by this section) in the case of any 
     partnership taxable year which includes December 31, 2010, 
     the amount of the net income referred to in such section 
     shall be treated as being the lesser of the net income for 
     the entire partnership taxable year or the net income 
     determined by only taking into account items attributable to 
     the portion of the partnership taxable year which is after 
     such date.
       (3) Dispositions of partnership interests.--Section 710(b) 
     of the Internal Revenue Code of 1986 (as added by this 
     section) shall apply to dispositions and distributions after 
     December 31, 2010.
       (4) Other income and gain in connection with investment 
     management services.--Section 710(e) of such Code (as added 
     by this section) shall take effect on December 31, 2010.

     SEC. 413. EMPLOYMENT TAX TREATMENT OF PROFESSIONAL SERVICE 
                   BUSINESSES.

       (a) In General.--Section 1402 is amended by adding at the 
     end the following new subsection:
       ``(m) Special Rules for Professional Service Businesses.--
       ``(1) Shareholders providing services to disqualified s 
     corporations.--
       ``(A) In general.--In the case of any disqualified S 
     corporation, each shareholder of such disqualified S 
     corporation who provides substantial services with respect to 
     the professional service business referred to in subparagraph 
     (C) shall take into account such shareholder's pro rata share 
     of all items of income or loss described in section 1366 
     which are attributable to such business in determining the 
     shareholder's net earnings from self-employment.
       ``(B) Treatment of family members.--Except as otherwise 
     provided by the Secretary, the shareholder's pro rata share 
     of items referred to in subparagraph (A) shall be increased 
     by the pro rata share of such items of each member of such 
     shareholder's family (within the meaning of section 
     318(a)(1)) who does not provide substantial services with 
     respect to such professional service business.
       ``(C) Disqualified s corporation.--For purposes of this 
     subsection, the term `disqualified S corporation' means--
       ``(i) any S corporation which is a partner in a partnership 
     which is engaged in a professional service business if 
     substantially all of the activities of such S corporation are 
     performed in connection with such partnership, and
       ``(ii) any other S corporation which is engaged in a 
     professional service business if the principal asset of such 
     business is the reputation and skill of 3 or fewer employees.
       ``(2) Partners.--In the case of any partnership which is 
     engaged in a professional service business, subsection 
     (a)(13) shall not apply to any partner who provides 
     substantial services with respect to such professional 
     service business.
       ``(3) Professional service business.--For purposes of this 
     subsection, the term `professional service business' means 
     any trade or business if substantially all of the activities 
     of such trade or business involve providing services in the 
     fields of health, law, lobbying, engineering, architecture, 
     accounting, actuarial science, performing arts, consulting, 
     athletics, investment advice or management, or brokerage 
     services.
       ``(4) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary or appropriate to carry out 
     the purposes of this subsection, including regulations which 
     prevent the avoidance of the purposes of this subsection 
     through tiered entities or otherwise.
       ``(5) Cross reference.--For employment tax treatment of 
     wages paid to shareholders of S corporations, see subtitle 
     C.''.
       (b) Conforming Amendment.--Section 211 of the Social 
     Security Act is amended by adding at the end the following 
     new subsection:
       ``(l) Special Rules for Professional Service Businesses.--
       ``(1) Shareholders providing services to disqualified s 
     corporations.--
       ``(A) In general.--In the case of any disqualified S 
     corporation, each shareholder of such disqualified S 
     corporation who provides substantial services with respect to 
     the professional service business referred to in subparagraph 
     (C) shall take into account such shareholder's pro rata share 
     of all items of income or loss described in section 1366 of 
     the Internal Revenue Code of 1986 which are attributable to 
     such business in determining the shareholder's net earnings 
     from self-employment.
       ``(B) Treatment of family members.--Except as otherwise 
     provided by the Secretary of the Treasury, the shareholder's 
     pro rata share of items referred to in subparagraph (A) shall 
     be increased by the pro rata share of such items of each 
     member of such shareholder's family (within the meaning of 
     section 318(a)(1) of the Internal Revenue Code of 1986) who 
     does not provide substantial services with respect to such 
     professional service business.
       ``(C) Disqualified s corporation.--For purposes of this 
     subsection, the term `disqualified S corporation' means--
       ``(i) any S corporation which is a partner in a partnership 
     which is engaged in a professional service business if 
     substantially all of the activities of such S corporation are 
     performed in connection with such partnership, and
       ``(ii) any other S corporation which is engaged in a 
     professional service business if the principal asset of such 
     business is the reputation and skill of 3 or fewer employees.
       ``(2) Partners.--In the case of any partnership which is 
     engaged in a professional service business, subsection 
     (a)(12) shall not apply to any partner who provides 
     substantial services with respect to such professional 
     service business.
       ``(3) Professional service business.--For purposes of this 
     subsection, the term `professional service business' means 
     any trade or business if substantially all of the activities 
     of such trade or business involve providing services in the 
     fields of health, law, lobbying,

[[Page 10116]]

     engineering, architecture, accounting, actuarial science, 
     performing arts, consulting, athletics, investment advice or 
     management, or brokerage services.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2010.

                    Subtitle C--Corporate Provisions

     SEC. 421. TREATMENT OF SECURITIES OF A CONTROLLED CORPORATION 
                   EXCHANGED FOR ASSETS IN CERTAIN 
                   REORGANIZATIONS.

       (a) In General.--Section 361 (relating to nonrecognition of 
     gain or loss to corporations; treatment of distributions) is 
     amended by adding at the end the following new subsection:
       ``(d) Special Rules for Transactions Involving Section 355 
     Distributions.--In the case of a reorganization described in 
     section 368(a)(1)(D) with respect to which stock or 
     securities of the corporation to which the assets are 
     transferred are distributed in a transaction which qualifies 
     under section 355--
       ``(1) this section shall be applied by substituting `stock 
     other than nonqualified preferred stock (as defined in 
     section 351(g)(2))' for `stock or securities' in subsections 
     (a) and (b)(1), and
       ``(2) the first sentence of subsection (b)(3) shall apply 
     only to the extent that the sum of the money and the fair 
     market value of the other property transferred to such 
     creditors does not exceed the adjusted bases of such assets 
     transferred (reduced by the amount of the liabilities assumed 
     (within the meaning of section 357(c))).''.
       (b) Conforming Amendment.--Paragraph (3) of section 361(b) 
     is amended by striking the last sentence.
       (c) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to exchanges 
     after the date of the enactment of this Act.
       (2) Transition rule.--The amendments made by this section 
     shall not apply to any exchange pursuant to a transaction 
     which is--
       (A) made pursuant to a written agreement which was binding 
     on March 15, 2010, and at all times thereafter;
       (B) described in a ruling request submitted to the Internal 
     Revenue Service on or before such date; or
       (C) described on or before such date in a public 
     announcement or in a filing with the Securities and Exchange 
     Commission.

     SEC. 422. TAXATION OF BOOT RECEIVED IN REORGANIZATIONS.

       (a) In General.--Paragraph (2) of section 356(a) is 
     amended--
       (1) by striking ``If an exchange'' and inserting ``Except 
     as otherwise provided by the Secretary--
       ``(A) In general.--If an exchange'';
       (2) by striking ``then there shall be'' and all that 
     follows through ``February 28, 1913'' and inserting ``then 
     the amount of other property or money shall be treated as a 
     dividend to the extent of the earnings and profits of the 
     corporation''; and
       (3) by adding at the end the following new subparagraph:
       ``(B) Certain reorganizations.--In the case of a 
     reorganization described in section 368(a)(1)(D) to which 
     section 354(b)(1) applies or any other reorganization 
     specified by the Secretary, in applying subparagraph (A)--
       ``(i) the earnings and profits of each corporation which is 
     a party to the reorganization shall be taken into account, 
     and
       ``(ii) the amount which is a dividend (and source thereof) 
     shall be determined under rules similar to the rules of 
     paragraphs (2) and (5) of section 304(b).''.
       (b) Earnings and Profits.--Paragraph (7) of section 312(n) 
     is amended by adding at the end the following: ``A similar 
     rule shall apply to an exchange to which section 356(a)(1) 
     applies.''.
       (c) Conforming Amendment.--Paragraph (1) of section 356(a) 
     is amended by striking ``then the gain'' and inserting ``then 
     (except as provided in paragraph (2)) the gain''.
       (d) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to exchanges 
     after the date of the enactment of this Act.
       (2) Transition rule.--The amendments made by this section 
     shall not apply to any exchange between unrelated persons 
     pursuant to a transaction which is--
       (A) made pursuant to a written agreement which was binding 
     on May 20, 2010, and at all times thereafter;
       (B) described in a ruling request submitted to the Internal 
     Revenue Service on or before such date; or
       (C) described in a public announcement or filing with the 
     Securities and Exchange Commission on or before such date.
       (3) Related persons.--For purposes of this subsection, a 
     person shall be treated as related to another person if the 
     relationship between such persons is described in section 267 
     or 707(b) of the Internal Revenue Code of 1986.

                      Subtitle D--Other Provisions

     SEC. 431. MODIFICATIONS WITH RESPECT TO OIL SPILL LIABILITY 
                   TRUST FUND.

       (a) Extension of Application of Oil Spill Liability Trust 
     Fund Financing Rate.--Paragraph (2) of section 4611(f) is 
     amended by striking ``December 31, 2017'' and inserting 
     ``December 31, 2020''.
       (b) Increase in Oil Spill Liability Trust Fund Financing 
     Rate.--Subparagraph (B) of section 4611(c)(2) is amended to 
     read as follows:
       ``(B) the Oil Spill Liability Trust Fund financing rate is 
     41 cents a barrel.''.
       (c) Increase in Per Incident Limitations on Expenditures.--
     Subparagraph (A) of section 9509(c)(2) is amended--
       (1) by striking ``$1,000,000,000'' in clause (i) and 
     inserting ``$5,000,000,000'';
       (2) by striking ``$500,000,000'' in clause (ii) and 
     inserting ``$2,500,000,000''; and
       (3) by striking ``$1,000,000,000 per incident, etc'' in the 
     heading and inserting ``Per incident limitations''.
       (d) Effective Date.--
       (1) Extension of financing rate.--Except as provided in 
     paragraph (2), the amendments made by this section shall take 
     effect on the date of the enactment of this Act.
       (2) Increase in financing rate.--The amendment made by 
     subsection (b) shall apply to crude oil received and 
     petroleum products entered during calendar quarters beginning 
     more than 60 days after the date of the enactment of this 
     Act.

     SEC. 432. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.

       The percentage under paragraph (2) of section 561 of the 
     Hiring Incentives to Restore Employment Act in effect on the 
     date of the enactment of this Act is increased by 36 
     percentage points.

          TITLE V--UNEMPLOYMENT, HEALTH, AND OTHER ASSISTANCE

        Subtitle A--Unemployment Insurance and Other Assistance

     SEC. 501. EXTENSION OF UNEMPLOYMENT INSURANCE PROVISIONS.

       (a) In General.--(1) Section 4007 of the Supplemental 
     Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304 
     note) is amended--
       (A) by striking ``June 2, 2010'' each place it appears and 
     inserting ``November 30, 2010'';
       (B) in the heading for subsection (b)(2), by striking 
     ``june 2, 2010'' and inserting ``november 30, 2010''; and
       (C) in subsection (b)(3), by striking ``November 6, 2010'' 
     and inserting ``April 30, 2011''.
       (2) Section 2002(e) of the Assistance for Unemployed 
     Workers and Struggling Families Act, as contained in Public 
     Law 111-5 (26 U.S.C. 3304 note; 123 Stat. 438), is amended--
       (A) in paragraph (1)(B), by striking ``June 2, 2010'' and 
     inserting ``November 30, 2010'';
       (B) in the heading for paragraph (2), by striking ``june 2, 
     2010'' and inserting ``november 30, 2010''; and
       (C) in paragraph (3), by striking ``December 7, 2010'' and 
     inserting ``May 31, 2011''.
       (3) Section 2005 of the Assistance for Unemployed Workers 
     and Struggling Families Act, as contained in Public Law 111-5 
     (26 U.S.C. 3304 note; 123 Stat. 444), is amended--
       (A) by striking ``June 2, 2010'' each place it appears and 
     inserting ``December 1, 2010''; and
       (B) in subsection (c), by striking ``November 6, 2010'' and 
     inserting ``May 1, 2011''.
       (4) Section 5 of the Unemployment Compensation Extension 
     Act of 2008 (Public Law 110-449; 26 U.S.C. 3304 note) is 
     amended by striking ``November 6, 2010'' and inserting 
     ``April 30, 2011''.
       (b) Funding.--Section 4004(e)(1) of the Supplemental 
     Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304 
     note) is amended--
       (1) in subparagraph (D), by striking ``and'' at the end; 
     and
       (2) by inserting after subparagraph (E) the following:
       ``(F) the amendments made by section 501(a)(1) of the 
     American Jobs and Closing Tax Loopholes Act of 2010; and''.
       (c) Conditions for Receiving Emergency Unemployment 
     Compensation.--Section 4001(d)(2) of the Supplemental 
     Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304 
     note) is amended, in the matter preceding subparagraph (A), 
     by inserting before ``shall apply'' the following: 
     ``(including terms and conditions relating to availability 
     for work, active search for work, and refusal to accept 
     work)''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect as if included in the enactment of the 
     Continuing Extension Act of 2010 (Public Law 111-157).

     SEC. 502. COORDINATION OF EMERGENCY UNEMPLOYMENT COMPENSATION 
                   WITH REGULAR COMPENSATION.

       (a) Certain Individuals Not Ineligible by Reason of New 
     Entitlement to Regular Benefits.--Section 4002 of the 
     Supplemental Appropriations Act, 2008 (Public Law 110-252; 26 
     U.S.C. 3304 note) is amended by adding at the end the 
     following:
       ``(g) Coordination of Emergency Unemployment Compensation 
     With Regular Compensation.--
       ``(1) If--
       ``(A) an individual has been determined to be entitled to 
     emergency unemployment compensation with respect to a benefit 
     year,
       ``(B) that benefit year has expired,
       ``(C) that individual has remaining entitlement to 
     emergency unemployment compensation with respect to that 
     benefit year, and
       ``(D) that individual would qualify for a new benefit year 
     in which the weekly benefit amount of regular compensation is 
     at least either $100 or 25 percent less than the individual's 
     weekly benefit amount in the benefit year referred to in 
     subparagraph (A),


[[Page 10117]]


     then the State shall determine eligibility for compensation 
     as provided in paragraph (2).
       ``(2) For individuals described in paragraph (1), the State 
     shall determine whether the individual is to be paid 
     emergency unemployment compensation or regular compensation 
     for a week of unemployment using one of the following 
     methods:
       ``(A) The State shall, if permitted by State law, establish 
     a new benefit year, but defer the payment of regular 
     compensation with respect to that new benefit year until 
     exhaustion of all emergency unemployment compensation payable 
     with respect to the benefit year referred to in paragraph 
     (1)(A);
       ``(B) The State shall, if permitted by State law, defer the 
     establishment of a new benefit year (which uses all the wages 
     and employment which would have been used to establish a 
     benefit year but for the application of this paragraph), 
     until exhaustion of all emergency unemployment compensation 
     payable with respect to the benefit year referred to in 
     paragraph(1)(A);
       ``(C) The State shall pay, if permitted by State law--
       ``(i) regular compensation equal to the weekly benefit 
     amount established under the new benefit year, and
       ``(ii) emergency unemployment compensation equal to the 
     difference between that weekly benefit amount and the weekly 
     benefit amount for the expired benefit year; or
       ``(D) The State shall determine rights to emergency 
     unemployment compensation without regard to any rights to 
     regular compensation if the individual elects to not file a 
     claim for regular compensation under the new benefit year.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to individuals whose benefit years, as described 
     in section 4002(g)(1)(B) the Supplemental Appropriations Act, 
     2008 (Public Law 110-252; 26 U.S.C. 3304 note), as amended by 
     this section, expire after the date of enactment of this Act.

     SEC. 503. EXTENSION OF THE EMERGENCY CONTINGENCY FUND.

       (a) In General.--Section 403(c) of the Social Security Act 
     (42 U.S.C. 603(c)) is amended--
       (1) in paragraph (2)(A), by inserting ``, and for fiscal 
     year 2011, $2,500,000,000'' before ``for payment'';
       (2) by striking paragraph (2)(B) and inserting the 
     following:
       ``(B) Availability and use of funds.--
       ``(i) Fiscal years 2009 and 2010.--The amounts appropriated 
     to the Emergency Fund under subparagraph (A) for fiscal year 
     2009 shall remain available through fiscal year 2010 and 
     shall be used to make grants to States in each of fiscal 
     years 2009 and 2010 in accordance with paragraph (3), except 
     that the amounts shall remain available through fiscal year 
     2011 to make grants and payments to States in accordance with 
     paragraph (3)(C) to cover expenditures to subsidize 
     employment positions held by individuals placed in the 
     positions before fiscal year 2011.
       ``(ii) Fiscal year 2011.--Subject to clause (iii), the 
     amounts appropriated to the Emergency Fund under subparagraph 
     (A) for fiscal year 2011 shall remain available through 
     fiscal year 2012 and shall be used to make grants to States 
     based on expenditures in fiscal year 2011 for benefits and 
     services provided in fiscal year 2011 in accordance with the 
     requirements of paragraph (3).
       ``(iii) Reservation of funds.--Of the amounts appropriated 
     to the Emergency Fund under subparagraph (A) for fiscal year 
     2011, $500,000 shall be placed in reserve for use in fiscal 
     year 2012, and shall be used to award grants for any 
     expenditures described in this subsection incurred by States 
     after September 30, 2011.'';
       (3) in paragraph (2)(C), by striking ``2010'' and inserting 
     ``2012'';
       (4) in paragraph (3)--
       (A) in clause (i) of each of subparagraphs (A), (B), and 
     (C)--
       (i) by striking ``year 2009 or 2010'' and inserting ``years 
     2009 through 2011'';
       (ii) by striking ``and'' at the end of subclause (I);
       (iii) by striking the period at the end of subclause (II) 
     and inserting ``; and''; and
       (iv) by adding at the end the following:

       ``(III) if the quarter is in fiscal year 2011, has provided 
     the Secretary with such information as the Secretary may find 
     necessary in order to make the determinations, or take any 
     other action, described in paragraph (5)(C).''; and

       (B) in subparagraph (C), by adding at the end the 
     following:
       ``(iv) Limitation on expenditures for subsidized 
     employment.--An expenditure for subsidized employment shall 
     be taken into account under clause (ii) only if the 
     expenditure is used to subsidize employment for--

       ``(I) a member of a needy family (without regard to whether 
     the family is receiving assistance under the State program 
     funded under this part); or
       ``(II) an individual who has exhausted (or, within 60 days, 
     will exhaust) all rights to receive unemployment compensation 
     under Federal and State law, and who is a member of a needy 
     family.'';

       (5) by striking paragraph (5) and inserting the following:
       ``(5) Limitations on payments; adjustment authority.--
       ``(A) Fiscal years 2009 and 2010.--The total amount payable 
     to a single State under subsection (b) and this subsection 
     for fiscal years 2009 and 2010 combined shall not exceed 50 
     percent of the annual State family assistance grant.
       ``(B) Fiscal year 2011.--Subject to subparagraph (C), the 
     total amount payable to a single State under subsection (b) 
     and this subsection for fiscal year 2011 shall not exceed 30 
     percent of the annual State family assistance grant.
       ``(C) Adjustment authority.--If the Secretary determines 
     that the Emergency Fund is at risk of being depleted before 
     September 30, 2011, or that funds are available to 
     accommodate additional State requests under this subsection, 
     the Secretary may, through program instructions issued 
     without regard to the requirements of section 553 of title 5, 
     United States Code--
       ``(i) specify priority criteria for awarding grants to 
     States during fiscal year 2011; and
       ``(ii) adjust the percentage limitation applicable under 
     subparagraph (B) with respect to the total amount payable to 
     a single State for fiscal year 2011.''; and
       (6) in paragraph (6), by inserting ``or for expenditures 
     described in paragraph (3)(C)(iv)'' before the period.
       (b) Conforming Amendments.--Section 2101 of division B of 
     the American Recovery and Reinvestment Act of 2009 (Public 
     Law 111-5) is amended--
       (1) in subsection (a)(2)--
       (A) by striking ``2010'' and inserting ``2011''; and
       (B) by striking all that follows ``repealed'' and inserting 
     a period; and
       (2) in subsection (d)(1), by striking ``2010'' and 
     inserting ``2011''.
       (c) Program Guidance.--The Secretary of Health and Human 
     Services shall issue program guidance, without regard to the 
     requirements of section 553 of title 5, United States Code, 
     which ensures that the funds provided under the amendments 
     made by this section to a jurisdiction for subsidized 
     employment do not support any subsidized employment position 
     the annual salary of which is greater than, at State option--
       (1) 200 percent of the poverty line (within the meaning of 
     section 673(2) of the Omnibus Budget Reconciliation Act of 
     1981, including any revision required by such section 673(2)) 
     for a family of 4; or
       (2) the median wage in the jurisdiction.

                     Subtitle B--Health Provisions

     SEC. 511. EXTENSION OF SECTION 508 RECLASSIFICATIONS.

       (a) In General.--Section 106(a) of division B of the Tax 
     Relief and Health Care Act of 2006 (42 U.S.C. 1395 note), as 
     amended by section 117 of the Medicare, Medicaid, and SCHIP 
     Extension Act of 2007 (Public Law 110-173), section 124 of 
     the Medicare Improvements for Patients and Providers Act of 
     2008 (Public Law 110-275), and sections 3137(a) and 10317 of 
     Public Law 111-148, is amended by striking ``September 30, 
     2010'' and inserting ``September 30, 2011''.
       (b) Conforming Amendment.--Section 117(a)(3) of the 
     Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public 
     Law 110-173)), is amended by inserting ``in fiscal years 2008 
     and 2009'' after ``For purposes of implementation of this 
     subsection''.

     SEC. 512. REPEAL OF DELAY OF RUG-IV.

       Effective as if included in the enactment of Public Law 
     111-148, section 10325 of such Act is repealed.

     SEC. 513. LIMITATION ON REASONABLE COSTS PAYMENTS FOR CERTAIN 
                   CLINICAL DIAGNOSTIC LABORATORY TESTS FURNISHED 
                   TO HOSPITAL PATIENTS IN CERTAIN RURAL AREAS.

       Section 3122 of Public Law 111-148 is repealed and the 
     provision of law amended by such section is restored as if 
     such section had not been enacted.

     SEC. 514. FUNDING FOR CLAIMS REPROCESSING.

       For purposes of carrying out the provisions of, and 
     amendments made by, this Act that relate to title XVIII of 
     the Social Security Act, and other provisions of such title 
     that involve reprocessing of claims, there are appropriated 
     to the Secretary of Health and Human Services for the Centers 
     for Medicare & Medicaid Services Program Management Account, 
     from amounts in the general fund of the Treasury not 
     otherwise appropriated, $175,000,000. Amounts appropriated 
     under the preceding sentence shall remain available until 
     expended.

     SEC. 515. MEDICAID AND CHIP TECHNICAL CORRECTIONS.

       (a) Repeal of Exclusion of Certain Individuals and Entities 
     From Medicaid.--Section 6502 of Public Law 111-148 is 
     repealed and the provisions of law amended by such section 
     are restored as if such section had never been enacted. 
     Nothing in the previous sentence shall affect the execution 
     or placement of the insertion made by section 6503 of such 
     Act.
       (b) Income Level for Certain Children Under Medicaid.--
     Effective as if included in the enactment of Public Law 111-
     148, section 2001(a)(5)(B) of such Act is amended by striking 
     all that follows ``is amended'' and inserting the following: 
     ``by inserting after `100 percent' the following: `(or, 
     beginning January 1, 2014, 133 percent)'.''.
       (c) Calculation and Publication of Payment Error Rate 
     Measurement for Certain Years.--Section 601(b) of the 
     Children's Health Insurance Program Reauthorization

[[Page 10118]]

     Act of 2009 (Public Law 111-3) is amended by adding at the 
     end the following: ``The Secretary is not required under this 
     subsection to calculate or publish a national or a State-
     specific error rate for fiscal year 2009 or fiscal year 
     2010.''.
       (d) Corrections to Exceptions to Exclusion of Children of 
     Certain Employees.--Section 2110(b)(6) of the Social Security 
     Act (42 U.S.C. 1397jj(b)(6)) is amended--
       (1) in subparagraph (B)--
       (A) by striking ``per person'' in the heading; and
       (B) by striking ``each employee'' and inserting 
     ``employees''; and
       (2) in subparagraph (C), by striking ``, on a case-by-case 
     basis,''.
       (e) Electronic Health Records.--Effective as if included in 
     the enactment of section 4201(a)(2) of the American Recovery 
     and Reinvestment Act of 2009 (Public Law 111-5), section 
     1903(t) of the Social Security Act (42 U.S.C. 1396b(t)) is 
     amended--
       (1) in paragraph (3)(E), by striking ``reduced by any 
     payment that is made to such Medicaid provider from any other 
     source (other than under this subsection or by a State or 
     local government)'' and inserting ``reduced by the average 
     payment the Secretary estimates will be made to such Medicaid 
     providers (determined on a percentage or other basis for such 
     classes or types of providers as the Secretary may specify) 
     from other sources (other than under this subsection, or by 
     the Federal government or a State or local government)''; and
       (2) in paragraph (6)(B), by inserting before the period the 
     following: ``and shall be determined to have met such 
     responsibility to the extent that the payment to the Medicaid 
     provider is not in excess of 85 percent of the net average 
     allowable cost''.
       (f) Corrections of Designations.--
       (1) Section 1902 of the Social Security Act (42 U.S.C. 
     1396a) is amended--
       (A) in subsection (a)(10), in the matter following 
     subparagraph (G), by striking ``and'' before ``(XVI) the 
     medical'' and by striking ``(XVI) if'' and inserting ``(XVII) 
     if''; and
       (B) in subsection (ii)(2), by striking ``(XV)'' and 
     inserting ``(XVI)''.
       (2) Section 2107(e)(1) of the Social Security Act (42 
     U.S.C. 1397gg(e)(1)) is amended by redesignating the 
     subparagraph (N) of that section added by 2101(e) of Public 
     Law 111-148 as subparagraph (O).

     SEC. 516. ADDITION OF INPATIENT DRUG DISCOUNT PROGRAM TO 340B 
                   DRUG DISCOUNT PROGRAM.

       (a) Addition of Inpatient Drug Discount.--Title III of the 
     Public Health Service Act is amended by inserting after 
     section 340B (42 U.S.C. 256b) the following:

     ``SEC. 340B-1. DISCOUNT INPATIENT DRUGS FOR INDIVIDUALS 
                   WITHOUT PRESCRIPTION DRUG COVERAGE.

       ``(a) Requirements for Agreements With the Secretary.--
       ``(1) In general.--
       ``(A) Agreement.--The Secretary shall enter into an 
     agreement with each manufacturer of covered inpatient drugs 
     under which the amount required to be paid (taking into 
     account any rebate or discount, as provided by the Secretary) 
     to the manufacturer for covered inpatient drugs (other than 
     drugs described in paragraph (3)) purchased by a covered 
     entity on or after January 1, 2011, does not exceed an amount 
     equal to the average manufacturer price for the drug under 
     title XIX of the Social Security Act in the preceding 
     calendar quarter, reduced by the rebate percentage described 
     in paragraph (2). For a covered inpatient drug that also is a 
     covered outpatient drug under section 340B, the amount 
     required to be paid under the preceding sentence shall be 
     equal to the amount required to be paid under section 
     340B(a)(1) for such drug. The agreement with a manufacturer 
     under this subparagraph may, at the discretion of the 
     Secretary, be included in the agreement with the same 
     manufacturer under section 340B.
       ``(B) Ceiling price.--Each such agreement shall require 
     that the manufacturer furnish the Secretary with reports, on 
     a quarterly basis, of the price for each covered inpatient 
     drug subject to the agreement that, according to the 
     manufacturer, represents the maximum price that covered 
     entities may permissibly be required to pay for the drug 
     (referred to in this section as the `ceiling price'), and 
     shall require that the manufacturer offer each covered entity 
     covered inpatient drugs for purchase at or below the 
     applicable ceiling price if such drug is made available to 
     any other purchaser at any price.
       ``(C) Allocation method.--Each such agreement shall require 
     that, if the supply of a covered inpatient drug is 
     insufficient to meet demand, then the manufacturer may use an 
     allocation method that is reported in writing to, and 
     approved by, the Secretary and does not discriminate on the 
     basis of the price paid by covered entities or on any other 
     basis related to the participation of an entity in the 
     program under this section.
       ``(2) Rebate percentage defined.--
       ``(A) In general.--For a covered inpatient drug purchased 
     in a calendar quarter, the `rebate percentage' is the amount 
     (expressed as a percentage) equal to--
       ``(i) the average total rebate required under section 
     1927(c) of the Social Security Act (or the average total 
     rebate that would be required if the drug were a covered 
     outpatient drug under such section) with respect to the drug 
     (for a unit of the dosage form and strength involved) during 
     the preceding calendar quarter; divided by
       ``(ii) the average manufacturer price for such a unit of 
     the drug during such quarter.
       ``(B) Over the counter drugs.--
       ``(i) In general.--For purposes of subparagraph (A), in the 
     case of over the counter drugs, the `rebate percentage' shall 
     be determined as if the rebate required under section 1927(c) 
     of the Social Security Act is based on the applicable 
     percentage provided under section 1927(c)(3) of such Act.
       ``(ii) Definition.--The term `over the counter drug' means 
     a drug that may be sold without a prescription and which is 
     prescribed by a physician (or other persons authorized to 
     prescribe such drug under State law).
       ``(3) Drugs provided under state medicaid plans.--Drugs 
     described in this paragraph are drugs purchased by the entity 
     for which payment is made by the State under the State plan 
     for medical assistance under title XIX of the Social Security 
     Act.
       ``(4) Requirements for covered entities.--
       ``(A) Prohibiting duplicate discounts or rebates.--
       ``(i) In general.--A covered entity shall not request 
     payment under title XIX of the Social Security Act for 
     medical assistance described in section 1905(a)(12) of such 
     Act with respect to a drug that is subject to an agreement 
     under this section if the drug is subject to the payment of a 
     rebate to the State under section 1927 of such Act.
       ``(ii) Establishment of mechanism.--The Secretary shall 
     establish a mechanism to ensure that covered entities comply 
     with clause (i). If the Secretary does not establish a 
     mechanism under the previous sentence within 12 months of the 
     enactment of this section, the requirements of section 
     1927(a)(5)(C) of the Social Security Act shall apply.
       ``(iii) Prohibiting disclosure to group purchasing 
     organizations.--In the event that a covered entity is a 
     member of a group purchasing organization, such entity shall 
     not disclose the price or any other information pertaining to 
     any purchases under this section directly or indirectly to 
     such group purchasing organization.
       ``(B) Prohibiting resale, dispensing, or administration of 
     drugs except to certain patients.--With respect to any 
     covered inpatient drug that is subject to an agreement under 
     this subsection, a covered entity shall not dispense, 
     administer, resell, or otherwise transfer the covered 
     inpatient drug to a person unless--
       ``(i) such person is a patient of the entity; and
       ``(ii) such person does not have health plan coverage (as 
     defined in subsection (c)(3)) that provides prescription drug 
     coverage in the inpatient setting with respect to such 
     covered inpatient drug.

     For purposes of clause (ii), a person shall be treated as 
     having health plan coverage (as defined in subsection (c)(3)) 
     with respect to a covered inpatient drug if benefits are not 
     payable under such coverage with respect to such drug for 
     reasons such as the application of a deductible or cost 
     sharing or the use of utilization management.
       ``(C) Auditing.--A covered entity shall permit the 
     Secretary and the manufacturer of a covered inpatient drug 
     that is subject to an agreement under this subsection with 
     the entity (acting in accordance with procedures established 
     by the Secretary relating to the number, duration, and scope 
     of audits) to audit at the Secretary's or the manufacturer's 
     expense the records of the entity that directly pertain to 
     the entity's compliance with the requirements described in 
     subparagraph (A) or (B) with respect to drugs of the 
     manufacturer. The use or disclosure of information for 
     performance of such an audit shall be treated as a use or 
     disclosure required by law for purposes of section 164.512(a) 
     of title 45, Code of Federal Regulations.
       ``(D) Additional sanction for noncompliance.--If the 
     Secretary finds, after notice and hearing, that a covered 
     entity is in violation of a requirement described in 
     subparagraph (A) or (B), the covered entity shall be liable 
     to the manufacturer of the covered inpatient drug that is the 
     subject of the violation in an amount equal to the reduction 
     in the price of the drug (as described in subparagraph (A)) 
     provided under the agreement between the Secretary and the 
     manufacturer under this subsection.
       ``(E) Maintenance of records.--
       ``(i) In general.--A covered entity shall establish and 
     maintain an effective recordkeeping system to comply with 
     this section and shall certify to the Secretary that such 
     entity is in compliance with subparagraphs (A) and (B). The 
     Secretary shall require that hospitals that purchase covered 
     inpatient drugs for inpatient dispensing or administration 
     under this subsection appropriately segregate inventory of 
     such covered inpatient drugs, either physically or 
     electronically, from drugs for outpatient use, as well as 
     from drugs for inpatient dispensing or administration to 
     individuals who have (for purposes of subparagraph (B)) 
     health plan

[[Page 10119]]

     coverage described in clause (ii) of such subparagraph.
       ``(ii) Certification of no third-party payer.--A covered 
     entity shall maintain records that contain certification by 
     the covered entity that no third party payment was received 
     for any covered inpatient drug that is subject to an 
     agreement under this subsection and that was dispensed to an 
     inpatient.
       ``(5) Treatment of distinct units of hospitals.--In the 
     case of a covered entity that is a distinct part of a 
     hospital, the distinct part of the hospital shall not be 
     considered a covered entity under this subsection unless the 
     hospital is otherwise a covered entity under this subsection.
       ``(6) Notice to manufacturers.--The Secretary shall notify 
     manufacturers of covered inpatient drugs and single State 
     agencies under section 1902(a)(5) of the Social Security Act 
     of the identities of covered entities under this subsection, 
     and of entities that no longer meet the requirements of 
     paragraph (4), by means of timely updates of the Internet 
     website supported by the Department of Health and Human 
     Services relating to this section.
       ``(7) No prohibition on larger discount.--Nothing in this 
     subsection shall prohibit a manufacturer from charging a 
     price for a drug that is lower than the maximum price that 
     may be charged under paragraph (1).
       ``(b) Covered Entity Defined.--In this section, the term 
     `covered entity' means an entity that meets the requirements 
     described in subsection (a)(4) and is one of the following:
       ``(1) A subsection (d) hospital (as defined in section 
     1886(d)(1)(B) of the Social Security Act) that--
       ``(A) is owned or operated by a unit of State or local 
     government, is a public or private non-profit corporation 
     which is formally granted governmental powers by a unit of 
     State or local government, or is a private nonprofit hospital 
     which has a contract with a State or local government to 
     provide health care services to low income individuals who 
     are not entitled to benefits under title XVIII of the Social 
     Security Act or eligible for assistance under the State plan 
     for medical assistance under title XIX of such Act; and
       ``(B) for the most recent cost reporting period that ended 
     before the calendar quarter involved, had a disproportionate 
     share adjustment percentage (as determined using the 
     methodology under section 1886(d)(5)(F) of the Social 
     Security Act as in effect on the date of enactment of this 
     section) greater than 20.20 percent or was described in 
     section 1886(d)(5)(F)(i)(II) of such Act (as so in effect on 
     the date of enactment of this section).
       ``(2) A children's hospital excluded from the Medicare 
     prospective payment system pursuant to section 
     1886(d)(1)(B)(iii) of the Social Security Act that would meet 
     the requirements of paragraph (1), including the 
     disproportionate share adjustment percentage requirement 
     under subparagraph (B) of such paragraph, if the hospital 
     were a subsection (d) hospital as defined by section 
     1886(d)(1)(B) of the Social Security Act.
       ``(3) A free-standing cancer hospital excluded from the 
     Medicare prospective payment system pursuant to section 
     1886(d)(1)(B)(v) of the Social Security Act that would meet 
     the requirements of paragraph (1), including the 
     disproportionate share adjustment percentage requirement 
     under subparagraph (B) of such paragraph, if the hospital 
     were a subsection (d) hospital as defined by section 
     1886(d)(1)(B) of the Social Security Act.
       ``(4) An entity that is a critical access hospital (as 
     determined under section 1820(c)(2) of the Social Security 
     Act), and that meets the requirements of paragraph (1)(A).
       ``(5) An entity that is a rural referral center, as defined 
     by section 1886(d)(5)(C)(i) of the Social Security Act, or a 
     sole community hospital, as defined by section 
     1886(d)(5)(C)(iii) of such Act, and that both meets the 
     requirements of paragraph (1)(A) and has a disproportionate 
     share adjustment percentage equal to or greater than 8 
     percent.
       ``(c) Other Definitions.--In this section:
       ``(1) Average manufacturer price.--
       ``(A) In general.--The term `average manufacturer price'--
       ``(i) has the meaning given such term in section 1927(k) of 
     the Social Security Act, except that such term shall be 
     applied under this section with respect to covered inpatient 
     drugs in the same manner (as applicable) as such term is 
     applied under such section 1927(k) with respect to covered 
     outpatient drugs (as defined in such section); and
       ``(ii) with respect to a covered inpatient drug for which 
     there is no average manufacturer price (as defined in clause 
     (i)), shall be the amount determined under regulations 
     promulgated by the Secretary under subparagraph (B).
       ``(B) Rulemaking.--The Secretary shall by regulation, in 
     consultation with the Administrator of the Centers for 
     Medicare & Medicaid Services, establish a method for 
     determining the average manufacturer price for covered 
     inpatient drugs for which there is no average manufacturer 
     price (as defined in subparagraph (A)(i)). Regulations 
     promulgated with respect to covered inpatient drugs under the 
     preceding sentence shall provide for the application of 
     methods for determining the average manufacturer price that 
     are the same as the methods used to determine such price in 
     calculating rebates required for such drugs under an 
     agreement between a manufacturer and a State that satisfies 
     the requirements of section 1927(b) of the Social Security 
     Act, as applicable.
       ``(2) Covered inpatient drug.--The term `covered inpatient 
     drug' means a drug--
       ``(A) that is described in section 1927(k)(2) of the Social 
     Security Act;
       ``(B) that, notwithstanding paragraph (3)(A) of section 
     1927(k) of such Act, is used in connection with an inpatient 
     service provided by a covered entity that is enrolled to 
     participate in the drug discount program under this section; 
     and
       ``(C) that is not purchased by the covered entity through 
     or under contract with a group purchasing organization.
       ``(3) Health plan coverage.--The term `health plan 
     coverage' means--
       ``(A) health insurance coverage (as defined in section 
     2791, and including coverage under a State health benefits 
     risk pool);
       ``(B) coverage under a group health plan (as defined in 
     such section, and including coverage under a church plan, a 
     governmental plan, or a collectively bargained plan);
       ``(C) coverage under a Federal health care program (as 
     defined by section 1128B(f) of the Social Security Act); or
       ``(D) such other health benefits coverage as the Secretary 
     recognizes for purposes of this section.
       ``(4) Manufacturer.--The term `manufacturer' has the 
     meaning given such term in section 1927(k) of the Social 
     Security Act.
       ``(d) Program Integrity.--
       ``(1) Manufacturer compliance.--
       ``(A) In general.--From amounts appropriated under 
     subsection (f), the Secretary shall provide for improvements 
     in compliance by manufacturers with the requirements of this 
     section in order to prevent overcharges and other violations 
     of the discounted pricing requirements specified in this 
     section.
       ``(B) Improvements.--The improvements described in 
     subparagraph (A) shall include the following:
       ``(i) The establishment of a process to enable the 
     Secretary to verify the accuracy of ceiling prices calculated 
     by manufacturers under subsection (a)(1) and charged to 
     covered entities, which shall include the following:

       ``(I) Developing and publishing through an appropriate 
     policy or regulatory issuance, precisely defined standards 
     and methodology for the calculation of ceiling prices under 
     such subsection.
       ``(II) Comparing regularly the ceiling prices calculated by 
     the Secretary with the quarterly pricing data that is 
     reported by manufacturers to the Secretary.
       ``(III) Conducting periodic monitoring of sales 
     transactions by covered entities.
       ``(IV) Inquiring into any discrepancies between ceiling 
     prices and manufacturer pricing data that may be identified 
     and taking, or requiring manufacturers to take, corrective 
     action in response to such discrepancies, including the 
     issuance of refunds pursuant to the procedures set forth in 
     clause (ii).

       ``(ii) The establishment of procedures for manufacturers to 
     issue refunds to covered entities in the event that there is 
     an overcharge by the manufacturers, including the following:

       ``(I) Providing the Secretary with an explanation of why 
     and how the overcharge occurred, how the refunds will be 
     calculated, and to whom the refunds will be issued.
       ``(II) Oversight by the Secretary to ensure that the 
     refunds are issued accurately and within a reasonable period 
     of time.

       ``(iii) The provision of access through the Internet 
     website supported by the Department of Health and Human 
     Services to the applicable ceiling prices for covered 
     inpatient drugs as calculated and verified by the Secretary 
     in accordance with this section, in a manner (such as through 
     the use of password protection) that limits such access to 
     covered entities and adequately assures security and 
     protection of privileged pricing data from unauthorized re-
     disclosure.
       ``(iv) The development of a mechanism by which--

       ``(I) rebates, discounts, or other price concessions 
     provided by manufacturers to other purchasers subsequent to 
     the sale of covered inpatient drugs to covered entities are 
     reported to the Secretary; and
       ``(II) appropriate credits and refunds are issued to 
     covered entities if such discounts, rebates, or other price 
     concessions have the effect of lowering the applicable 
     ceiling price for the relevant quarter for the drugs 
     involved.

       ``(v) Selective auditing of manufacturers and wholesalers 
     to ensure the integrity of the drug discount program under 
     this section.
       ``(vi) The establishment of a requirement that 
     manufacturers and wholesalers use the identification system 
     developed by the Secretary for purposes of facilitating the 
     ordering, purchasing, and delivery of covered inpatient drugs 
     under this section, including the processing of chargebacks 
     for such drugs.
       ``(vii) The imposition of sanctions in the form of civil 
     monetary penalties, which--

[[Page 10120]]

       ``(I) shall be assessed according to standards and 
     procedures established in regulations to be promulgated by 
     the Secretary not later than January 1, 2011;
       ``(II) shall not exceed $10,000 per single dosage form of a 
     covered inpatient drug purchased by a covered entity where a 
     manufacturer knowingly charges such covered entity a price 
     for such drug that exceeds the ceiling price under subsection 
     (a)(1); and
       ``(III) shall not exceed $100,000 for each instance where a 
     manufacturer withholds or provides materially false 
     information to the Secretary or to covered entities under 
     this section or knowingly violates any provision of this 
     section (other than subsection (a)(1)).

       ``(2) Covered entity compliance.--
       ``(A) In general.--From amounts appropriated under 
     subsection (f), the Secretary shall provide for improvements 
     in compliance by covered entities with the requirements of 
     this section in order to prevent diversion and violations of 
     the duplicate discount provision and other requirements 
     specified under subsection (a)(4).
       ``(B) Improvements.--The improvements described in 
     subparagraph (A) shall include the following:
       ``(i) The development of procedures to enable and require 
     covered entities to update at least annually the information 
     on the Internet website supported by the Department of Health 
     and Human Services relating to this section.
       ``(ii) The development of procedures for the Secretary to 
     verify the accuracy of information regarding covered entities 
     that is listed on the website described in clause (i).
       ``(iii) The development of more detailed guidance 
     describing methodologies and options available to covered 
     entities for billing covered inpatient drugs to State 
     Medicaid agencies in a manner that avoids duplicate discounts 
     pursuant to subsection (a)(4)(A).
       ``(iv) The establishment of a single, universal, and 
     standardized identification system by which each covered 
     entity site and each covered entity's purchasing status under 
     sections 340B and this section can be identified by 
     manufacturers, distributors, covered entities, and the 
     Secretary for purposes of facilitating the ordering, 
     purchasing, and delivery of covered inpatient drugs under 
     this section, including the processing of chargebacks for 
     such drugs.
       ``(v) The imposition of sanctions in the form of civil 
     monetary penalties, which--

       ``(I) shall be assessed according to standards and 
     procedures established in regulations promulgated by the 
     Secretary; and
       ``(II) shall not exceed $10,000 for each instance where a 
     covered entity knowingly violates subsection (a)(4)(B) or 
     knowingly violates any other provision of this section.

       ``(vi) The termination of a covered entity's participation 
     in the program under this section, for a period of time to be 
     determined by the Secretary, in cases in which the Secretary 
     determines, in accordance with standards and procedures 
     established by regulation, that--

       ``(I) the violation by a covered entity of a requirement of 
     this section was repeated and knowing; and
       ``(II) imposition of a monetary penalty would be 
     insufficient to reasonably ensure compliance with the 
     requirements of this section.

       ``(vii) The referral of matters, as appropriate, to the 
     Food and Drug Administration, the Office of the Inspector 
     General of the Department of Health and Human Services, or 
     other Federal or State agencies.
       ``(3) Administrative dispute resolution process.--From 
     amounts appropriated under subsection (f), the Secretary may 
     establish and implement an administrative process for the 
     resolution of the following:
       ``(A) Claims by covered entities that manufacturers have 
     violated the terms of their agreement with the Secretary 
     under subsection (a)(1).
       ``(B) Claims by manufacturers that covered entities have 
     violated subsection (a)(4)(A) or (a)(4)(B).
       ``(e) Audit and Sanctions.--
       ``(1) Audit.--From amounts appropriated under subsection 
     (f), the Inspector General of the Department of Health and 
     Human Services (referred to in this subsection as the 
     `Inspector General') shall audit covered entities under this 
     section to verify compliance with criteria for eligibility 
     and participation under this section, including the 
     antidiversion prohibitions under subsection (a)(4)(B), and 
     take enforcement action or provide information to the 
     Secretary who shall take action to ensure program compliance, 
     as appropriate. A covered entity shall provide to the 
     Inspector General, upon request, records relevant to such 
     audits.
       ``(2) Report.--For each audit conducted under paragraph 
     (1), the Inspector General shall prepare and publish in a 
     timely manner a report which shall include findings and 
     recommendations regarding--
       ``(A) the appropriateness of covered entity eligibility 
     determinations and, as applicable, certifications;
       ``(B) the effectiveness of antidiversion prohibitions; and
       ``(C) the effectiveness of restrictions on inpatient 
     dispensing and administration.
       ``(f) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for fiscal year 2011 and each 
     succeeding fiscal year.''.
       (b) Rulemaking.--Not later than January 1, 2011, the 
     Secretary shall promulgate regulations implementing section 
     340B-1 of the Public Health Service Act (as added by 
     subsection (a)).
       (c) Conforming Amendment to Section 340B.--Paragraph (1) of 
     section 340B(a) of the Public Health Service Act (42 U.S.C. 
     256b(a)) is amended by adding at the end the following: 
     ``Such agreement shall further require that, if the supply of 
     a covered outpatient drug is insufficient to meet demand, 
     then the manufacturer may use an allocation method that is 
     reported in writing to, and approved by, the Secretary and 
     does not discriminate on the basis of the price paid by 
     covered entities or on any other basis related to the 
     participation of an entity in the program under this section. 
     The agreement with a manufacturer under this paragraph may, 
     at the discretion of the Secretary, be included in the 
     agreement with the same manufacturer under section 340B-1.''.
       (d) Conforming Amendments to Medicaid.--Section 1927 of the 
     Social Security Act (42 U.S.C. 1396r-8) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1), in the first sentence, by striking 
     ``and paragraph (6)'' and inserting ``, paragraph (6), and 
     paragraph (8)''; and
       (B) by adding at the end the following new paragraph:
       ``(8) Limitation on prices of drugs purchased by 340b-1-
     covered entities.--
       ``(A) Agreement with secretary.--A manufacturer meets the 
     requirements of this paragraph if the manufacturer has 
     entered into an agreement with the Secretary that meets the 
     requirements of section 340B-1 of the Public Health Service 
     Act with respect to covered inpatient drugs (as defined in 
     such section) purchased by a 340B-1-covered entity on or 
     after January 1, 2011.
       ``(B) 340B-1-covered entity defined.--In this subsection, 
     the term `340B-1-covered entity' means an entity described in 
     section 340B-1(b) of the Public Health Service Act.''; and
       (2) in subsection (c)(1)(C)(i)(I)--
       (A) by striking ``or'' before ``a covered entity''; and
       (B) by inserting before the semicolon the following: ``, or 
     a covered entity for a covered inpatient drug (as such terms 
     are defined in section 340B-1of the Public Health Service 
     Act)''.

     SEC. 517. CONTINUED INCLUSION OF ORPHAN DRUGS IN DEFINITION 
                   OF COVERED OUTPATIENT DRUGS WITH RESPECT TO 
                   CHILDREN'S HOSPITALS UNDER THE 340B DRUG 
                   DISCOUNT PROGRAM.

       (a) Definition of Covered Outpatient Drug.--
       (1) Amendment.--Subsection (e) of section 340B of the 
     Public Health Service Act (42 U.S.C. 256b) is amended by 
     striking ``covered entities described in subparagraph 
     (M)''and inserting ``covered entities described in 
     subparagraph (M) (other than a children's hospital described 
     in subparagraph (M))''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall take effect as if included in the enactment of section 
     2302 of the Health Care and Education Reconciliation Act of 
     2010 (Public Law 111-152).
       (b) Technical Amendment.--Subparagraph (B) of section 
     1927(a)(5) of the Social Security Act (42 U.S.C. 1396r-
     8(a)(5)) is amended by striking ``and a children's hospital'' 
     and all that follows through the end of the subparagraph and 
     inserting a period.

     SEC. 518. CONFORMING AMENDMENT RELATED TO WAIVER OF 
                   COINSURANCE FOR PREVENTIVE SERVICES.

       Effective as if included in section 10501(i)(2)(A) of 
     Public Law 111-148, section 1833(a)(3)(A) of the Social 
     Security Act (42 U.S.C. 1395l(a)(3)(A)) is amended by 
     striking ``section 1861(s)(10)(A)'' and inserting ``section 
     1861(ddd)(3)''.

     SEC. 519. ESTABLISH A CMS-IRS DATA MATCH TO IDENTIFY 
                   FRAUDULENT PROVIDERS.

       (a) Authority to Disclose Return Information Concerning 
     Outstanding Tax Debts for Purposes of Enhancing Medicare 
     Program Integrity.--
       (1) In general.--Section 6103(l) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     new paragraph:
       ``(22) Disclosure of return information to department of 
     health and human services for purposes of enhancing medicare 
     program integrity.--
       ``(A) In general.--The Secretary shall, upon written 
     request from the Secretary of Health and Human Services, 
     disclose to officers and employees of the Department of 
     Health and Human Services return information with respect to 
     a taxpayer who has applied to enroll, or reenroll, as a 
     provider of services or supplier under the Medicare program 
     under title XVIII of the Social Security Act. Such return 
     information shall be limited to--
       ``(i) the taxpayer identity information with respect to 
     such taxpayer;
       ``(ii) the amount of the delinquent tax debt owed by that 
     taxpayer; and
       ``(iii) the taxable year to which the delinquent tax debt 
     pertains.
       ``(B) Restriction on disclosure.--Return information 
     disclosed under subparagraph (A) may be used by officers and 
     employees of the Department of Health and Human Services for 
     the purposes of, and to the extent

[[Page 10121]]

     necessary in, establishing the taxpayer's eligibility for 
     enrollment or reenrollment in the Medicare program, or in any 
     administrative or judicial proceeding relating to, or arising 
     from, a denial of such enrollment or reenrollment, or in 
     determining the level of enhanced oversight to be applied 
     with respect to such taxpayer pursuant to section 1866(j)(3) 
     of the Social Security Act.
       ``(C) Delinquent tax debt.--For purposes of this paragraph, 
     the term `delinquent tax debt' means an outstanding debt 
     under this title for which a notice of lien has been filed 
     pursuant to section 6323, but the term does not include a 
     debt that is being paid in a timely manner pursuant to an 
     agreement under section 6159 or 7122, or a debt with respect 
     to which a collection due process hearing under section 6330 
     is requested, pending, or completed and no payment is 
     required.''.
       (2) Conforming amendments.--Section 6103(p)(4) of such 
     Code, as amended by sections 1414 and 3308 of Public Law 111-
     148, in the matter preceding subparagraph (A) and in 
     subparagraph (F)(ii), is amended by striking ``or (17)'' and 
     inserting ``(17), or (22)'' each place it appears.
       (b) Secretary's Authority to Use Information From the 
     Department of Treasury in Medicare Enrollments and 
     Reenrollments.--Section 1866(j)(2) of the Social Security Act 
     (42 U.S.C. 1395cc(j)), as inserted by section 6401(a) of 
     Public Law 111-148, is further amended--
       (1) by redesignating subparagraph (E) as subparagraph (F); 
     and
       (2) by inserting after subparagraph (D) the following new 
     subparagraph:
       ``(E) Use of information from the department of treasury 
     concerning tax debts.--In reviewing the application of a 
     provider of services or supplier to enroll or reenroll under 
     the program under this title, the Secretary shall take into 
     account the information supplied by the Secretary of the 
     Treasury pursuant to section 6103(l)(22) of the Internal 
     Revenue Code of 1986, in determining whether to deny such 
     application or to apply enhanced oversight to such provider 
     of services or supplier pursuant to paragraph (3) if the 
     Secretary determines such provider of services or supplier 
     owes such a debt.''.
       (c) Authority to Adjust Payments of Providers of Services 
     and Suppliers With the Same Tax Identification Number for 
     Medicare Obligations.--Section 1866(j)(5) of the Social 
     Security Act (42 U.S.C. 1395cc(j)(5)), as inserted by section 
     6401(a) of Public Law 111-148, is amended--
       (1) in the paragraph heading, by striking ``past-due'' and 
     inserting ``medicare'';
       (2) in subparagraph (A), by striking ``past-due obligations 
     described in subparagraph (B)(ii) of an'' and inserting 
     ``amount described in subparagraph (B)(ii) due from such''; 
     and
       (3) in subparagraph (B)(ii), by striking ``a past-due 
     obligation'' and inserting ``an amount that is more than the 
     amount required to be paid''.

     SEC. 520. CLARIFICATION OF EFFECTIVE DATE OF PART B SPECIAL 
                   ENROLLMENT PERIOD FOR DISABLED TRICARE 
                   BENEFICIARIES.

       Effective as if included in the enactment of Public Law 
     111-148, section 3110(a)(2) of such Act is amended to read as 
     follows:
       ``(2) Effective date.--The amendment made by paragraph (1) 
     shall apply to elections made after the date of the enactment 
     of this Act.''.

     SEC. 521. PHYSICIAN PAYMENT UPDATE.

       (a) In General.--Section 1848(d) of the Social Security Act 
     (42 U.S.C. 1395w-4(d)) is amended--
       (1) in paragraph (10), in the heading, by striking 
     ``portion'' and inserting ``the first 5 months''; and
       (2) by adding at the end the following new paragraphs:
       ``(11) Update for the last 7 months of 2010.--
       ``(A) In general.--Subject to paragraphs (7)(B), (8)(B), 
     (9)(B), and (10)(B), in lieu of the update to the single 
     conversion factor established in paragraph (1)(C) that would 
     otherwise apply for 2010 for the period beginning on June 1, 
     2010, and ending on December 31, 2010, the update to the 
     single conversion factor shall be 2.2 percent.
       ``(B) No effect on computation of conversion factor for 
     2011 and subsequent years.--The conversion factor under this 
     subsection shall be computed under paragraph (1)(A) for 2011 
     and subsequent years as if subparagraph (A) had never 
     applied.
       ``(12) Update for 2011.--
       ``(A) In general.--Subject to paragraphs (7)(B), (8)(B), 
     (9)(B), (10)(B), and (11)(B), in lieu of the update to the 
     single conversion factor established in paragraph (1)(C) that 
     would otherwise apply for 2011, the update to the single 
     conversion factor shall be 1.0 percent.
       ``(B) No effect on computation of conversion factor for 
     2012 and subsequent years.--The conversion factor under this 
     subsection shall be computed under paragraph (1)(A) for 2012 
     and subsequent years as if subparagraph (A) had never 
     applied.''.
       (b) Statutory Paygo.--The budgetary effects of this Act, 
     for the purpose of complying with the Statutory Pay-As-You-Go 
     Act of 2010, shall be determined by reference to the latest 
     statement titled ``Budgetary Effects of PAYGO Legislation'' 
     for this Act, jointly submitted for printing in the 
     Congressional Record by the Chairmen of the House and Senate 
     Budget Committees, provided that such statement has been 
     submitted prior to the vote on passage in the House acting 
     first on this conference report or amendment between the 
     Houses.

     SEC. 522. ADJUSTMENT TO MEDICARE PAYMENT LOCALITIES.

       (a) In General.--Section 1848(e) of the Social Security Act 
     (42 U.S.C.1395w-4(e)) is amended by adding at the end the 
     following new paragraph:
       ``(6) Transition to use of msas as fee schedule areas in 
     california.--
       ``(A) In general.--
       ``(i) Revision.--Subject to clause (ii) and notwithstanding 
     the previous provisions of this subsection, for services 
     furnished on or after January 1, 2012, the Secretary shall 
     revise the fee schedule areas used for payment under this 
     section applicable to the State of California using the 
     Metropolitan Statistical Area (MSA) iterative Geographic 
     Adjustment Factor methodology as follows:

       ``(I) The Secretary shall configure the physician fee 
     schedule areas using the Metropolitan Statistical Areas (each 
     in this paragraph referred to as an `MSA'), as defined by the 
     Director of the Office of Management and Budget as of the 
     date of the enactment of this paragraph, as the basis for the 
     fee schedule areas.
       ``(II) For purposes of this clause, the Secretary shall 
     treat all areas not included in an MSA as a single rest-of-
     State MSA and any reference in this paragraph to an MSA shall 
     be deemed to include a reference to such rest-of-State MSA.
       ``(III) The Secretary shall list all MSAs within the State 
     by Geographic Adjustment Factor described in paragraph (2) 
     (in this paragraph referred to as a `GAF') in descending 
     order.
       ``(IV) In the first iteration, the Secretary shall compare 
     the GAF of the highest cost MSA in the State to the weighted-
     average GAF of all the remaining MSAs in the State. If the 
     ratio of the GAF of the highest cost MSA to the weighted-
     average of the GAF of remaining lower cost MSAs is 1.05 or 
     greater, the highest cost MSA shall be a separate fee 
     schedule area.
       ``(V) In the next iteration, the Secretary shall compare 
     the GAF of the MSA with the second-highest GAF to the 
     weighted-average GAF of the all the remaining MSAs (excluding 
     MSAs that become separate fee schedule areas). If the ratio 
     of the second-highest MSA's GAF to the weighted-average of 
     the remaining lower cost MSAs is 1.05 or greater, the second-
     highest MSA shall be a separate fee schedule area.
       ``(VI) The iterative process shall continue until the ratio 
     of the GAF of the MSA with highest remaining GAF to the 
     weighted-average of the remaining MSAs with lower GAFs is 
     less than 1.05, and the remaining group of MSAs with lower 
     GAFs shall be treated as a single rest-of-State fee schedule 
     area.
       ``(VII) For purposes of the iterative process described in 
     this clause, if two MSAs have identical GAFs, they shall be 
     combined.

       ``(ii) Transition.--For services furnished on or after 
     January 1, 2012, and before January 1, 2017, in the State of 
     California, after calculating the work, practice expense, and 
     malpractice geographic indices that would otherwise be 
     determined under clauses (i), (ii), and (iii) of paragraph 
     (1)(A) for a fee schedule area determined under clause (i), 
     if the index for a county within a fee schedule area is less 
     than the index that would otherwise be in effect for such 
     county, the Secretary shall instead apply the index that 
     would otherwise be in effect for such county.
       ``(B) Subsequent revisions.--After the transition described 
     in subparagraph (A)(ii), not less than every 3 years the 
     Secretary shall review and update the fee schedule areas 
     using the methodology described in subparagraph (A)(i) and 
     any updated MSAs as defined by the Director of the Office of 
     Management and Budget. The Secretary shall review and make 
     any changes pursuant to such reviews concurrent with the 
     application of the periodic review of the adjustment factors 
     required under paragraph (1)(C) for California.
       ``(C) References to fee schedule areas.--Effective for 
     services furnished on or after January 1, 2012, for the State 
     of California, any reference in this section to a fee 
     schedule area shall be deemed a reference to a fee schedule 
     area established in accordance with this paragraph.''.
       (b) Conforming Amendment to Definition of Fee Schedule 
     Area.--Section 1848(j)(2) of the Social Security Act (42 
     U.S.C. 1395w(j)(2)) is amended by striking ``The term'' and 
     inserting ``Except as provided in subsection (e)(6)(C), the 
     term''.

     SEC. 523. CLARIFICATION OF 3-DAY PAYMENT WINDOW.

       (a) In General.--Section 1886 of the Social Security Act 
     (42 U.S.C. 1395ww) is amended--
       (1) by adding at the end of subsection (a)(4) the following 
     new sentence: ``In applying the first sentence of this 
     paragraph, the term `other services related to the admission' 
     includes all services that are not diagnostic services (other 
     than ambulance and maintenance renal dialysis services) for 
     which payment may be made under this title that are provided 
     by a hospital (or an entity wholly owned or operated by the 
     hospital) to a patient--

[[Page 10122]]

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

     SEC. 524. EXTENSION OF ARRA INCREASE IN FMAP.

       Section 5001 of the American Recovery and Reinvestment Act 
     of 2009 (Public Law 111-5) is amended--
       (1) in subsection (a)(3), by striking ``first calendar 
     quarter'' and inserting ``first 3 calendar quarters'';
       (2) in subsection (c)--
       (A) in paragraph (2)(B), by striking ``July 1, 2010'' and 
     inserting ``January 1, 2011'';
       (B) in paragraph (3)(B)(i), by striking ``July 1, 2010'' 
     and inserting ``January 1, 2011'' each place it appears; and
       (C) in paragraph (4)(C)(ii), by striking ``the 3-
     consecutive-month period beginning with January 2010'' and 
     inserting ``any 3-consecutive-month period that begins after 
     December 2009 and ends before January 2011'';
       (3) in subsection (e), by adding at the end the following:

     ``Notwithstanding paragraph (5), effective for payments made 
     on or after January 1, 2010, the increases in the FMAP for a 
     State under this section shall apply to payments under title 
     XIX of such Act that are attributable to expenditures for 
     medical assistance provided to nonpregnant childless adults 
     made eligible under a State plan under such title (including 
     under any waiver under such title or under section 1115 of 
     such Act (42 U.S.C. 1315)) who would have been eligible for 
     child health assistance or other health benefits under 
     eligibility standards in effect as of December 31, 2009, of a 
     waiver of the State child health plan under the title XXI of 
     such Act.'';
       (4) in subsection (g)--
       (A) in paragraph (1), by striking ``September 30, 2011'' 
     and inserting ``March 31, 2012'';
       (B) in paragraph (2), by inserting ``of such Act'' after 
     ``1923''; and
       (C) by adding at the end the following:
       ``(3) Certification by chief executive officer.--No 
     additional Federal funds shall be paid to a State as a result 
     of this section with respect to a calendar quarter occurring 
     during the period beginning on January 1, 2011, and ending on 
     June 30, 2011, unless, not later than 45 days after the date 
     of enactment of this paragraph, the chief executive officer 
     of the State certifies that the State will request and use 
     such additional Federal funds.''; and
       (5) in subsection (h)(3), by striking ``December 31, 2010'' 
     and inserting ``June 30, 2011''.

                       TITLE VI--OTHER PROVISIONS

     SEC. 601. EXTENSION OF NATIONAL FLOOD INSURANCE PROGRAM.

       (a) Extension.--Section 129 of the Continuing 
     Appropriations Resolution, 2010 (Public Law 111-68), as 
     amended by section 7(a) of Public Law 111-157, is amended by 
     striking ``by substituting'' and all that follows through the 
     period at the end, and inserting ``by substituting December 
     31, 2010, for the date specified in each such section.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall be considered to have taken effect on May 31, 2010.

     SEC. 602. ALLOCATION OF GEOTHERMAL RECEIPTS.

       Notwithstanding any other provision of law, for fiscal year 
     2010 only, all funds received from sales, bonuses, royalties, 
     and rentals under the Geothermal Steam Act of 1970 (30 U.S.C. 
     1001 et seq.) shall be deposited in the Treasury, of which--
       (1) 50 percent shall be used by the Secretary of the 
     Treasury to make payments to States within the boundaries of 
     which the leased land and geothermal resources are located;
       (2) 25 percent shall be used by the Secretary of the 
     Treasury to make payments to the counties within the 
     boundaries of which the leased land or geothermal resources 
     are located; and
       (3) 25 percent shall be deposited in miscellaneous 
     receipts.

     SEC. 603. SMALL BUSINESS LOAN GUARANTEE ENHANCEMENT 
                   EXTENSIONS.

       (a) Appropriation.--There is appropriated, out of any funds 
     in the Treasury not otherwise appropriated, for an additional 
     amount for ``Small Business Administration--Business Loans 
     Program Account'', $505,000,000, to remain available through 
     December 31, 2010, for the cost of--
       (1) fee reductions and eliminations under section 501 of 
     division A of the American Recovery and Reinvestment Act of 
     2009 (Public Law 111-5; 123 Stat. 151), as amended by this 
     section; and
       (2) loan guarantees under section 502 of division A of the 
     American Recovery and Reinvestment Act of 2009 (Public Law 
     111-5; 123 Stat. 152), as amended by this section.

     Such costs, including the cost of modifying such loans, shall 
     be as defined in section 502 of the Congressional Budget Act 
     of 1974.
       (b) Extension of Programs.--
       (1) Fees.--Section 501 of division A of the American 
     Recovery and Reinvestment Act of 2009 (Public Law 111-5; 123 
     Stat. 151) is amended by striking ``September 30, 2010'' each 
     place it appears and inserting ``December 31, 2010''.
       (2) Loan guarantees.--Section 502(f) of division A of the 
     American Recovery and Reinvestment Act of 2009 (Public Law 
     111-5; 123 Stat. 153) is amended by striking ``May 31, 2010'' 
     and inserting ``December 31, 2010''.
       (c) Appropriation.--There is appropriated for an additional 
     amount, out of any funds in the Treasury not otherwise 
     appropriated, for administrative expenses to carry out 
     sections 501 and 502 of division A of the American Recovery 
     and Reinvestment Act of 2009 (Public Law 111-5), $5,000,000, 
     to remain available until expended, which may be transferred 
     and merged with the appropriation for ``Small Business 
     Administration--Salaries and Expenses''.

     SEC. 604. EMERGENCY AGRICULTURAL DISASTER ASSISTANCE.

       (a) Definitions.--Except as otherwise provided in this 
     section, in this section:
       (1) Disaster county.--
       (A) In general.--The term ``disaster county'' means a 
     county included in the geographic area covered by a 
     qualifying natural disaster declaration for the 2009 crop 
     year.
       (B) Exclusion.--The term ``disaster county'' does not 
     include a contiguous county.
       (2) Eligible aquaculture producer.--The term ``eligible 
     aquaculture producer'' means an aquaculture producer that 
     during the 2009 calendar year, as determined by the 
     Secretary--
       (A) produced an aquaculture species for which feed costs 
     represented a substantial percentage of the input costs of 
     the aquaculture operation; and
       (B) experienced a substantial price increase of feed costs 
     above the previous 5-year average.
       (3) Eligible producer.--The term ``eligible producer'' 
     means an agricultural producer in a disaster county.
       (4) Eligible specialty crop producer.--The term ``eligible 
     specialty crop producer'' means an agricultural producer 
     that, for the 2009 crop year, as determined by the 
     Secretary--
       (A) produced, or was prevented from planting, a specialty 
     crop; and
       (B) experienced specialty crop losses in a disaster county 
     due to drought, excessive rainfall, or a related condition.
       (5) Qualifying natural disaster declaration.--The term 
     ``qualifying natural disaster declaration'' means a natural 
     disaster declared by the Secretary for production losses 
     under section 321(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1961(a)).
       (6) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.

[[Page 10123]]

       (7) Specialty crop.--The term ``specialty crop'' has the 
     meaning given the term in section 3 of the Specialty Crops 
     Competitiveness Act of 2004 (Public Law 108-465; 7 U.S.C. 
     1621 note).
       (b) Supplemental Direct Payment.--
       (1) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use such sums as are 
     necessary to make supplemental payments under sections 1103 
     and 1303 of the Food, Conservation, and Energy Act of 2008 (7 
     U.S.C. 8713, 8753) to eligible producers on farms located in 
     disaster counties that had at least 1 crop of economic 
     significance (other than specialty crops or crops intended 
     for grazing) suffer at least a 5-percent crop loss on a farm 
     due to a natural disaster, including quality losses, as 
     determined by the Secretary, in an amount equal to 90 percent 
     of the direct payment the eligible producers received for the 
     2009 crop year on the farm.
       (2) ACRE program.--Eligible producers that received direct 
     payments under section 1105 of the Food, Conservation, and 
     Energy Act of 2008 (7 U.S.C. 8715) for the 2009 crop year and 
     that otherwise meet the requirements of paragraph (1) shall 
     be eligible to receive supplemental payments under that 
     paragraph in an amount equal to 112.5 percent of the reduced 
     direct payment the eligible producers received for the 2009 
     crop year under section 1103 or 1303 of the Food, 
     Conservation, and Energy Act of 2008 (7 U.S.C. 8713, 8753).
       (3) Relationship to other law.--Assistance received under 
     this subsection shall be included in the calculation of farm 
     revenue for the 2009 crop year under section 531(b)(4)(A) of 
     the Federal Crop Insurance Act (7 U.S.C. 1531(b)(4)(A)) and 
     section 901(b)(4)(A) of the Trade Act of 1974 (19 U.S.C. 
     2497(b)(4)(A)).
       (c) Specialty Crop Assistance.--
       (1) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use not more than 
     $300,000,000, to remain available until September 30, 2011, 
     to carry out a program of grants to States to assist eligible 
     specialty crop producers for losses due to a natural disaster 
     affecting the 2009 crops, of which not more than--
       (A) $150,000,000 shall be used to assist eligible specialty 
     crop producers in counties that have been declared a disaster 
     as the result of drought; and
       (B) $150,000,000 shall be used to assist eligible specialty 
     crop producers in counties that have been declared a disaster 
     as the result of excessive rainfall or a related condition.
       (2) Notification.--Not later than 45 days after the date of 
     enactment of this Act, the Secretary shall notify the State 
     department of agriculture (or similar entity) in each State 
     of the availability of funds to assist eligible specialty 
     crop producers, including such terms as are determined by the 
     Secretary to be necessary for the equitable treatment of 
     eligible specialty crop producers.
       (3) Provision of grants.--
       (A) In general.--The Secretary shall make grants to States 
     for disaster counties on a pro rata basis based on the value 
     of specialty crop losses in those counties during the 2009 
     calendar year, as determined by the Secretary.
       (B) Administrative costs.--State Secretary of Agriculture 
     may not use more than five percent of the funds provided for 
     costs associated with the administration of the grants 
     provided in paragraph (1).
       (C) Administration of grants.--State Secretary of 
     Agriculture may enter into a contract with the Department of 
     Agriculture to administer the grants provided in paragraph 
     (1).
       (D) Timing.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall make grants to 
     States to provide assistance under this subsection.
       (E) Maximum grant.--The maximum amount of a grant made to a 
     State for counties described in paragraph (1)(B) may not 
     exceed $40,000,000.
       (4) Requirements.--The Secretary shall make grants under 
     this subsection only to States that demonstrate to the 
     satisfaction of the Secretary that the State will--
       (A) use grant funds to issue payments to eligible specialty 
     crop producers;
       (B) provide assistance to eligible specialty crop producers 
     not later than 60 days after the date on which the State 
     receives grant funds; and
       (C) not later than 30 days after the date on which the 
     State provides assistance to eligible specialty crop 
     producers, submit to the Secretary a report that describes--
       (i) the manner in which the State provided assistance;
       (ii) the amounts of assistance provided by type of 
     specialty crop; and
       (iii) the process by which the State determined the levels 
     of assistance to eligible specialty crop producers.
       (D) Relation to other law.--Assistance received under this 
     subsection shall be included in the calculation of farm 
     revenue for the 2009 crop year under section 531(b)(4)(A) of 
     the Federal Crop Insurance Act (7 U.S.C. 1531(b)(4)(A)) and 
     section 901(b)(4)(A) of the Trade Act of 1974 (19 U.S.C. 
     2497(b)(4)(A)).
       (d) Cottonseed Assistance.--
       (1) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use not more than 
     $42,000,000 to provide supplemental assistance to eligible 
     producers and first-handlers of the 2009 crop of cottonseed 
     in a disaster county.
       (2) General terms.--Except as otherwise provided in this 
     subsection, the Secretary shall provide disaster assistance 
     under this subsection under the same terms and conditions as 
     assistance provided under section 3015 of the Emergency 
     Agricultural Disaster Assistance Act of 2006 (title III of 
     Public Law 109-234; 120 Stat. 477).
       (3) Distribution of assistance.--The Secretary shall 
     distribute assistance to first handlers for the benefit of 
     eligible producers in a disaster county in an amount equal to 
     the product obtained by multiplying--
       (A) the payment rate, as determined under paragraph (4); 
     and
       (B) the county-eligible production, as determined under 
     paragraph (5).
       (4) Payment rate.--The payment rate shall be equal to the 
     quotient obtained by dividing--
       (A) the total funds made available to carry out this 
     subsection; by
       (B) the sum of the county-eligible production, as 
     determined under paragraph (5).
       (5) County-eligible production.--The county-eligible 
     production shall be equal to the product obtained by 
     multiplying--
       (A) the number of acres planted to cotton in the disaster 
     county, as reported to the Secretary by first handlers;
       (B) the expected cotton lint yield for the disaster county, 
     as determined by the Secretary based on the best available 
     information; and
       (C) the national average seed-to-lint ratio, as determined 
     by the Secretary based on the best available information for 
     the 5 crop years immediately preceding the 2009 crop, 
     excluding the year in which the average ratio was the highest 
     and the year in which the average ratio was the lowest in 
     such period.
       (e) Aquaculture Assistance.--
       (1) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use not more than 
     $25,000,000, to remain available until September 30, 2011, to 
     carry out a program of grants to States to assist eligible 
     aquaculture producers for losses associated with high feed 
     input costs during the 2009 calendar year.
       (2) Notification.--Not later than 45 days after the date of 
     enactment of this Act, the Secretary shall notify the State 
     department of agriculture (or similar entity) in each State 
     of the availability of funds to assist eligible aquaculture 
     producers, including such terms as are determined by the 
     Secretary to be necessary for the equitable treatment of 
     eligible aquaculture producers.
       (3) Provision of grants.--
       (A) In general.--The Secretary shall make grants to States 
     under this subsection on a pro rata basis based on the amount 
     of aquaculture feed used in each State during the 2009 
     calendar year, as determined by the Secretary.
       (B) Timing.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall make grants to 
     States to provide assistance under this subsection.
       (4) Requirements.--The Secretary shall make grants under 
     this subsection only to States that demonstrate to the 
     satisfaction of the Secretary that the State will--
       (A) use grant funds to assist eligible aquaculture 
     producers;
       (B) provide assistance to eligible aquaculture producers 
     not later than 60 days after the date on which the State 
     receives grant funds; and
       (C) not later than 30 days after the date on which the 
     State provides assistance to eligible aquaculture producers, 
     submit to the Secretary a report that describes--
       (i) the manner in which the State provided assistance;
       (ii) the amounts of assistance provided per species of 
     aquaculture; and
       (iii) the process by which the State determined the levels 
     of assistance to eligible aquaculture producers.
       (5) Reduction in payments.--An eligible aquaculture 
     producer that receives assistance under this subsection shall 
     not be eligible to receive any other assistance under the 
     supplemental agricultural disaster assistance program 
     established under section 531 of the Federal Crop Insurance 
     Act (7 U.S.C. 1531) and section 901 of the Trade Act of 1974 
     (19 U.S.C. 2497) for any losses in 2009 relating to the same 
     species of aquaculture.
       (6) Report to congress.--Not later than 240 days after the 
     date of enactment of this Act, the Secretary shall submit to 
     the appropriate committees of Congress a report that--
       (A) describes in detail the manner in which this subsection 
     has been carried out; and
       (B) includes the information reported to the Secretary 
     under paragraph (4)(C).
       (f) Hawaii Transportation Cooperative.--Notwithstanding any 
     other provision of law, the Secretary shall use $21,000,000 
     of funds of the Commodity Credit Corporation to make a 
     payment to an agricultural transportation cooperative in the 
     State of Hawaii, the members of which are eligible to 
     participate in the commodity loan program of the Farm Service 
     Agency, for assistance to maintain and develop employment.
       (g) Livestock Forage Disaster Program.--

[[Page 10124]]

       (1) Definition of disaster county.--In this subsection:
       (A) In general.--The term ``disaster county'' means a 
     county included in the geographic area covered by a 
     qualifying natural disaster declaration announced by the 
     Secretary in calendar year 2009.
       (B) Inclusion.--The term ``disaster county'' includes a 
     contiguous county.
       (2) Payments.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use not more than 
     $50,000,000 to carry out a program to make payments to 
     eligible producers that had grazing losses in disaster 
     counties in calendar year 2009.
       (3) Criteria.--
       (A) In general.--Except as provided in subparagraph (B), 
     assistance under this subsection shall be determined under 
     the same criteria as are used to carry out the programs under 
     section 531(d) of the Federal Crop Insurance Act (7 U.S.C. 
     1531(d)) and section 901(d) of the Trade Act of 1974 (19 
     U.S.C. 2497(d)).
       (B) Drought intensity.--For purposes of this subsection, an 
     eligible producer shall not be required to meet the drought 
     intensity requirements of section 531(d)(3)(D)(ii) of the 
     Federal Crop Insurance Act (7 U.S.C. 1531(d)(3)(D)(ii)) and 
     section 901(d)(3)(D)(ii) of the Trade Act of 1974 (19 U.S.C. 
     2497(d)(3)(D)(ii)).
       (4) Amount.--Assistance under this subsection shall be in 
     an amount equal to 1 monthly payment using the monthly 
     payment rate under section 531(d)(3)(B) of the Federal Crop 
     Insurance Act (7 U.S.C. 1531(d)(3)(B)) and section 
     901(d)(3)(B) of the Trade Act of 1974 (19 U.S.C. 
     2497(d)(3)(B)).
       (5) Relation to other law.--An eligible producer that 
     receives assistance under this subsection shall be ineligible 
     to receive assistance for 2009 grazing losses under the 
     program carried out under section 531(d) of the Federal Crop 
     Insurance Act (7 U.S.C. 1531(d)) and section 901(d) of the 
     Trade Act of 1974 (19 U.S.C. 2497(d)).
       (h) Emergency Loans for Poultry Producers.--
       (1) Definitions.--In this subsection:
       (A) Announcement date.--The term ``announcement date'' 
     means the date on which the Secretary announces the emergency 
     loan program under this subsection.
       (B) Poultry integrator.--The term ``poultry integrator'' 
     means a poultry integrator that filed proceedings under 
     chapter 11 of title 11, United States Code, in United States 
     Bankruptcy Court during the 30-day period beginning on 
     December 1, 2008.
       (2) Loan program.--
       (A) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use not more than 
     $75,000,000, to remain available until expended, for the cost 
     of making no-interest emergency loans available to poultry 
     producers that meet the requirements of this subsection.
       (B) Terms and conditions.--Except as otherwise provided in 
     this subsection, emergency loans under this subsection shall 
     be subject to such terms and conditions as are determined by 
     the Secretary.
       (3) Loans.--
       (A) In general.--An emergency loan made to a poultry 
     producer under this subsection shall be for the purpose of 
     providing financing to the poultry producer in response to 
     financial losses associated with the termination or 
     nonrenewal of any contract between the poultry producer and a 
     poultry integrator.
       (B) Eligibility.--
       (i) In general.--To be eligible for an emergency loan under 
     this subsection, not later than 90 days after the 
     announcement date, a poultry producer shall submit to the 
     Secretary evidence that--

       (I) the contract of the poultry producer described in 
     subparagraph (A) was not continued; and
       (II) no similar contract has been awarded subsequently to 
     the poultry producer.

       (ii) Requirement to offer loans.--Notwithstanding any other 
     provision of law, if a poultry producer meets the eligibility 
     requirements described in clause (i), subject to the 
     availability of funds under paragraph (2)(A), the Secretary 
     shall offer to make a loan under this subsection to the 
     poultry producer with a minimum term of 2 years.
       (4) Additional requirements.--
       (A) In general.--A poultry producer that receives an 
     emergency loan under this subsection may use the emergency 
     loan proceeds only to repay the amount that the poultry 
     producer owes to any lender for the purchase, improvement, or 
     operation of the poultry farm.
       (B) Conversion of the loan.--A poultry producer that 
     receives an emergency loan under this subsection shall be 
     eligible to have the balance of the emergency loan converted, 
     but not refinanced, to a loan that has the same terms and 
     conditions as an operating loan under subtitle B of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 1941 et 
     seq.).
       (i) State and Local Governments.--Section 1001(f)(6)(A) of 
     the Food Security Act of 1985 (7 U.S.C. 1308(f)(6)(A)) is 
     amended by inserting ``(other than the conservation reserve 
     program established under subchapter B of chapter 1 of 
     subtitle D of title XII of this Act)'' before the period at 
     the end.
       (j) Administration.--
       (1) Regulations.--
       (A) In general.--As soon as practicable after the date of 
     enactment of this Act, the Secretary shall promulgate such 
     regulations as are necessary to implement this section and 
     the amendment made by this section.
       (B) Procedure.--The promulgation of the regulations and 
     administration of this section and the amendment made by this 
     section shall be made without regard to--
       (i) the notice and comment provisions of section 553 of 
     title 5, United States Code;
       (ii) the Statement of Policy of the Secretary of 
     Agriculture effective July 24, 1971 (36 Fed. Reg. 13804), 
     relating to notices of proposed rulemaking and public 
     participation in rulemaking; and
       (iii) chapter 35 of title 44, United States Code (commonly 
     known as the ``Paperwork Reduction Act'').
       (C) Congressional review of agency rulemaking.--In carrying 
     out this paragraph, the Secretary shall use the authority 
     provided under section 808 of title 5, United States Code.
       (2) Administrative costs.--Of the funds of the Commodity 
     Credit Corporation, the Secretary may use up to $10,000,000 
     to pay administrative costs incurred by the Secretary that 
     are directly related to carrying out this Act.
       (3) Prohibition.--None of the funds of the Agricultural 
     Disaster Relief Trust Fund established under section 902 of 
     the Trade Act of 1974 (19 U.S.C. 2497a) may be used to carry 
     out this Act.

     SEC. 605. SUMMER EMPLOYMENT FOR YOUTH.

       There is appropriated, out of any funds in the Treasury not 
     otherwise appropriated, for an additional amount for 
     ``Department of Labor--Employment and Training 
     Administration--Training and Employment Services'' for 
     activities under the Workforce Investment Act of 1998 
     (``WIA''), $1,000,000,000 shall be available for obligation 
     on the date of enactment of this Act for grants to States for 
     youth activities, including summer employment for youth: 
     Provided, That no portion of such funds shall be reserved to 
     carry out section 127(b)(1)(A) of the WIA: Provided further, 
     That for purposes of section 127(b)(1)(C)(iv) of the WIA, 
     funds available for youth activities shall be allotted as if 
     the total amount available for youth activities in the fiscal 
     year does not exceed $1,000,000,000: Provided further, That 
     with respect to the youth activities provided with such 
     funds, section 101(13)(A) of the WIA shall be applied by 
     substituting ``age 24'' for ``age 21'': Provided further, 
     That the work readiness performance indicator described in 
     section 136(b)(2)(A)(ii)(I) of the WIA shall be the only 
     measure of performance used to assess the effectiveness of 
     summer employment for youth provided with such funds: 
     Provided further, That an amount that is not more than 1 
     percent of such amount may be used for the administration, 
     management, and oversight of the programs, activities, and 
     grants carried out with such funds, including the evaluation 
     of the use of such funds: Provided further, That funds 
     available under the preceding proviso, together with funds 
     described in section 801(a) of division A of the American 
     Recovery and reinvestment Act of 2009 (Public Law 111-5), and 
     funds provided in such Act under the heading ``Department of 
     Labor-Departmental Management-Salaries and Expenses'', shall 
     remain available for obligation through September 30, 2011.

     SEC. 606. HOUSING TRUST FUND.

       (a) Funding.--There is hereby appropriated for the Housing 
     Trust Fund established pursuant to section 1338 of the 
     Federal Housing Enterprises Financial Safety and Soundness 
     Act of 1992 (12 U.S.C. 4568), $1,065,000,000, for use under 
     such section: Provided, That of the total amount provided 
     under this heading, $65,000,000 shall be available to the 
     Secretary of Housing and Urban Development only for 
     incremental project-based voucher assistance to be allocated 
     to States to be used solely in conjunction with grant funds 
     awarded under such section 1338, pursuant to the formula 
     established under section 1338 and taking into account 
     different per unit subsidy needs among states, as determined 
     by the Secretary.
       (b) Amendments.--Section 1338 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4568) is amended--
       (1) in subsection (c)--
       (A) in paragraph (4)(A) by inserting after the period at 
     the end the following: ``Notwithstanding any other provision 
     of law, for the fiscal year following enactment of this 
     sentence and thereafter, the Secretary may make such notice 
     available only on the Internet at the appropriate government 
     website or websites or through other electronic media, as 
     determined by the Secretary.'';
       (B) in paragraph (5)(C), by striking ``(8)'' and inserting 
     ``(9)''; and
       (C) in paragraph (7)(A)--
       (i) by striking ``section 1335(a)(2)(B)'' and inserting 
     ``section 1335(a)(1)(B)''; and
       (ii) by inserting ``the units funded under'' after ``75 
     percent of''; and
       (2) by adding at the end the following new subsection:
       ``(k) Environmental Review.--For the purpose of 
     environmental compliance review, funds awarded under this 
     section shall be subject to section 288 of the HOME 
     Investment Partnerships Act (12 U.S.C. 12838) and

[[Page 10125]]

     shall be treated as funds under the program established by 
     such Act.''.

     SEC. 607. THE INDIVIDUAL INDIAN MONEY ACCOUNT LITIGATION 
                   SETTLEMENT ACT OF 2010.

       (a) Short Title.--This section may be cited as the 
     ``Individual Indian Money Account Litigation Settlement Act 
     of 2010''.
       (b) Definitions.--In this section:
       (1) Amended complaint.--The term ``Amended Complaint'' 
     means the Amended Complaint attached to the Settlement.
       (2) Land consolidation program.--The term ``Land 
     Consolidation Program'' means a program conducted in 
     accordance with the Settlement and the Indian Land 
     Consolidation Act (25 U.S.C. 2201 et seq.) under which the 
     Secretary may purchase fractional interests in trust or 
     restricted land.
       (3) Litigation.--The term ``Litigation'' means the case 
     entitled Elouise Cobell et al. v. Ken Salazar et al., United 
     States District Court, District of Columbia, Civil Action No. 
     96-1285 (JR).
       (4) Plaintiff.--The term ``Plaintiff'' means a member of 
     any class certified in the Litigation.
       (5) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior.
       (6) Settlement.--The term ``Settlement'' means the Class 
     Action Settlement Agreement dated December 7, 2009, in the 
     Litigation, as modified by the parties to the Litigation.
       (7) Trust administration class.--The term ``Trust 
     Administration Class'' means the Trust Administration Class 
     as defined in the Settlement.
       (c) Purpose.--The purpose of this section is to authorize 
     the Settlement.
       (d) Authorization.--The Settlement is authorized, ratified, 
     and confirmed.
       (e) Jurisdictional Provisions.--
       (1) In general.--Notwithstanding the limitation of 
     jurisdiction of district courts contained in section 
     1346(a)(2) of title 28, United States Code, the United States 
     District Court for the District of Columbia shall have 
     jurisdiction over the claims asserted in the Amended 
     Complaint for purposes of the Settlement.
       (2) Certification of trust administration class.--
       (A) In general.--Notwithstanding the requirements of the 
     Federal Rules of Civil Procedure, the court overseeing the 
     Litigation may certify the Trust Administration Class.
       (B) Treatment.--On certification under subparagraph (A), 
     the Trust Administration Class shall be treated as a class 
     under Federal Rule of Civil Procedure 23(b)(3) for purposes 
     of the Settlement.
       (f) Trust Land Consolidation.--
       (1) Trust land consolidation fund.--
       (A) Establishment.--On final approval (as defined in the 
     Settlement) of the Settlement, there shall be established in 
     the Treasury of the United States a fund, to be known as the 
     ``Trust Land Consolidation Fund''.
       (B) Availability of amounts.--Amounts in the Trust Land 
     Consolidation Fund shall be made available to the Secretary 
     during the 10-year period beginning on the date of final 
     approval of the Settlement--
       (i) to conduct the Land Consolidation Program; and
       (ii) for other costs specified in the Settlement.
       (C) Deposits.--
       (i) In general.--On final approval (as defined in the 
     Settlement) of the Settlement, the Secretary of the Treasury 
     shall deposit in the Trust Land Consolidation Fund 
     $2,000,000,000 of the amounts appropriated by section 1304 of 
     title 31, United States Code.
       (ii) Conditions met.--The conditions described in section 
     1304 of title 31, United States Code, shall be considered to 
     be met for purposes of clause (i).
       (D) Transfers.--In a manner designed to encourage 
     participation in the Land Consolidation Program, the 
     Secretary may transfer, at the discretion of the Secretary, 
     not more than $60,000,000 of amounts in the Trust Land 
     Consolidation Fund to the Indian Education Scholarship 
     Holding Fund established under paragraph 2.
       (2) Indian education scholarship holding fund.--
       (A) Establishment.--On the final approval (as defined in 
     the Settlement) of the Settlement, there shall be established 
     in the Treasury of the United States a fund, to be known as 
     the ``Indian Education Scholarship Holding Fund''.
       (B) Availability.--Notwithstanding any other provision of 
     law governing competition, public notification, or Federal 
     procurement or assistance, amounts in the Indian Education 
     Scholarship Holding Fund shall be made available, without 
     further appropriation, to the Secretary to contribute to an 
     Indian Education Scholarship Fund, as described in the 
     Settlement, to provide scholarships for Native Americans.
       (3) Acquisition of trust or restricted land.--The Secretary 
     may acquire, at the discretion of the Secretary and in 
     accordance with the Land Consolidation Program, any 
     fractional interest in trust or restricted land.
       (4) Treatment of unlocatable plaintiffs.--A Plaintiff the 
     whereabouts of whom are unknown and who, after reasonable 
     efforts by the Secretary, cannot be located during the 5 year 
     period beginning on the date of final approval (as defined in 
     the Settlement) of the Settlement shall be considered to have 
     accepted an offer made pursuant to the Land Consolidation 
     Program.
       (g) Taxation and Other Benefits.--
       (1) Internal revenue code.--For purposes of the Internal 
     Revenue Code of 1986, amounts received by an individual 
     Indian as a lump sum or a periodic payment pursuant to the 
     Settlement--
       (A) shall not be included in gross income; and
       (B) shall not be taken into consideration for purposes of 
     applying any provision of the Internal Revenue Code of 1986 
     that takes into account excludible income in computing 
     adjusted gross income or modified adjusted gross income, 
     including section 86 of that Code (relating to Social 
     Security and tier 1 railroad retirement benefits).
       (2) Other benefits.--Notwithstanding any other provision of 
     law, for purposes of determining initial eligibility, ongoing 
     eligibility, or level of benefits under any Federal or 
     federally assisted program, amounts received by an individual 
     Indian as a lump sum or a periodic payment pursuant to the 
     Settlement shall not be treated for any household member, 
     during the 1-year period beginning on the date of receipt--
       (A) as income for the month during which the amounts were 
     received; or
       (B) as a resource.

     SEC. 608. APPROPRIATION OF FUNDS FOR FINAL SETTLEMENT OF 
                   CLAIMS FROM IN RE BLACK FARMERS DISCRIMINATION 
                   LITIGATION.

       (a) Definitions.--In this section:
       (1) Settlement agreement.--The term ``Settlement 
     Agreement'' means the settlement agreement dated February 18, 
     2010 (including any modifications agreed to by the parties 
     and approved by the court under that agreement) between 
     certain plaintiffs, by and through their counsel, and the 
     Secretary of Agriculture to resolve, fully and forever, the 
     claims raised or that could have been raised in the cases 
     consolidated in In re Black Farmers Discrimination 
     Litigation, No. 08-511 (D.D.C.), including Pigford claims 
     asserted under section 14012 of the Food, Conservation, and 
     Energy Act of 2008 (Public Law 110-246; 122 Stat. 2209).
       (2) Pigford claim.--The term ``Pigford claim'' has the 
     meaning given that term in section 14012(a)(3) of the Food, 
     Conservation, and Energy Act of 2008 (Public Law 110-246; 122 
     Stat. 2210).
       (b) Appropriation of Funds.--There is hereby appropriated 
     to the Secretary of Agriculture $1,150,000,000, to remain 
     available until expended, to carry out the terms of the 
     Settlement Agreement if the Settlement Agreement is approved 
     by a court order that is or becomes final and nonappealable. 
     The funds appropriated by this subsection are in addition to 
     the $100,000,000 of funds of the Commodity Credit Corporation 
     made available by section 14012(i) of the Food, Conservation, 
     and Energy Act of 2008 (Public Law 110-246; 122 Stat. 2212) 
     and shall be available for obligation only after those 
     Commodity Credit Corporation funds are fully obligated. If 
     the Settlement Agreement is not approved as provided in this 
     subsection, the $100,000,000 of funds of the Commodity Credit 
     Corporation made available by section 14012(i) of the Food, 
     Conservation, and Energy Act of 2008 shall be the sole 
     funding available for Pigford claims.
       (c) Use of Funds.--The use of the funds appropriated by 
     subsection (b) shall be subject to the express terms of the 
     Settlement Agreement.
       (d) Treatment of Remaining Funds.--If any of the funds 
     appropriated by subsection (b) are not obligated and expended 
     to carry out the Settlement Agreement, the Secretary of 
     Agriculture shall return the unused funds to the Treasury and 
     may not make the unused funds available for any purpose 
     related to section 14012 of the Food, Conservation, and 
     Energy Act of 2008, for any other settlement agreement 
     executed in In re Black Farmers Discrimination Litigation, 
     No. 08-511 (D.D.C.), or for any other purpose.
       (e) Rules of Construction.--Nothing in this section shall 
     be construed as requiring the United States, any of its 
     officers or agencies, or any other party to enter into the 
     Settlement Agreement or any other settlement agreement. 
     Nothing in this section shall be construed as creating the 
     basis for a Pigford claim.
       (f) Conforming Amendments.--Section 14012 of the Food, 
     Conservation, and Energy Act of 2008 (Public Law 110-246; 122 
     Stat. 2209) is amended--
       (1) in subsection (c)(1)--
       (A) by striking ``subsection (h)'' and inserting 
     ``subsection (g)''; and
       (B) by striking ``subsection (i)'' and inserting 
     ``subsection (h)'';
       (2) by striking subsection (e);
       (3) in subsection (g), by striking ``subsection (f)'' and 
     inserting ``subsection (e)'';
       (4) in subsection (i)--
       (A) by striking ``(1) In general.--Of the funds'' and 
     inserting ``Of the funds''; and
       (B) by striking paragraph (2);
       (5) by striking subsection (j); and
       (6) by redesignating subsections (f), (g), (h), (i), and 
     (k) as subsections (e), (f), (g), (h), and (i), respectively.

[[Page 10126]]



     SEC. 609. EXPANSION OF ELIGIBILITY FOR CONCURRENT RECEIPT OF 
                   MILITARY RETIRED PAY AND VETERANS' DISABILITY 
                   COMPENSATION TO INCLUDE ALL CHAPTER 61 
                   DISABILITY RETIREES REGARDLESS OF DISABILITY 
                   RATING PERCENTAGE OR YEARS OF SERVICE.

       (a) Phased Expansion Concurrent Receipt.--Subsection (a) of 
     section 1414 of title 10, United States Code, is amended to 
     read as follows:
       ``(a) Payment of Both Retired Pay and Disability 
     Compensation.--
       ``(1) Payment of both required.--
       ``(A) In general.--Subject to subsection (b), a member or 
     former member of the uniformed services who is entitled for 
     any month to retired pay and who is also entitled for that 
     month to veterans' disability compensation for a qualifying 
     service-connected disability (in this section referred to as 
     a `qualified retiree') is entitled to be paid both for that 
     month without regard to sections 5304 and 5305 of title 38.
       ``(B) Applicability of full concurrent receipt phase-in 
     requirement.--During the period beginning on January 1, 2004, 
     and ending on December 31, 2013, payment of retired pay to a 
     qualified retiree is subject to subsection (c).
       ``(C) Phase-in exception for 100 percent disabled 
     retirees.--The payment of retired pay is subject to 
     subsection (c) only during the period beginning on January 1, 
     2004, and ending on December 31, 2004, in the case of the 
     following qualified retirees:
       ``(i) A qualified retiree receiving veterans' disability 
     compensation for a disability rated as 100 percent.
       ``(ii) A qualified retiree receiving veterans' disability 
     compensation at the rate payable for a 100 percent disability 
     by reason of a determination of individual unemployability.
       ``(D) Temporary phase-in exception for certain chapter 61 
     disability retirees; termination.--Subject to subsection (b), 
     during the period beginning on January 1, 2011, and ending on 
     September 30, 2012, subsection (c) shall not apply to a 
     qualified retiree described in subparagraph (B) or (C) of 
     paragraph (2).
       ``(2) Qualifying service-connected disability defined.--In 
     this section:
       ``(A) 50 percent rating threshold.--In the case of a member 
     or former member receiving retired pay under any provision of 
     law other than chapter 61 of this title, or under chapter 61 
     with 20 years or more of service otherwise creditable under 
     section 1405 or computed under section 12732 of this title, 
     the term `qualifying service-connected disability' means a 
     service-connected disability or combination of service-
     connected disabilities that is rated as not less than 50 
     percent disabling by the Secretary of Veterans Affairs. 
     However, during the period specified in paragraph (1)(D), 
     members or former members receiving retired pay under chapter 
     61 with 20 years or more of creditable service computed under 
     section 12732 of this title, but not otherwise entitled to 
     retired pay under any other provision of this title, shall 
     qualify in accordance with subparagraphs (B) and (C).
       ``(B) Inclusion of members not otherwise entitled to 
     retired pay.--In the case of a member or former member 
     receiving retired pay under chapter 61 of this title, but who 
     is not otherwise entitled to retired pay under any other 
     provision of this title, the term `qualifying service-
     connected disability' means a service-connected disability or 
     combination of service-connected disabilities that is rated 
     by the Secretary of Veterans Affairs at the disabling level 
     specified in one of the following clauses (which, subject to 
     paragraph (3), is effective on or after the date specified in 
     the applicable clause):
       ``(i) January 1, 2011, rated 100 percent, or a rate payable 
     at 100 percent by reason of individual unemployability or 
     rated 90 percent.
       ``(ii) January 1, 2012, rated 80 percent or 70 percent.
       ``(iii) January 1, 2013, rated 60 percent or 50 percent.
       ``(C) Elimination of rating threshold.--In the case of a 
     member or former member receiving retired pay under chapter 
     61 regardless of being otherwise eligible for retirement, the 
     term `qualifying service-connected disability' means a 
     service-connected disability or combination of service-
     connected disabilities that is rated by the Secretary of 
     Veterans Affairs at the disabling level specified in one of 
     the following clauses (which, subject to paragraph (3), is 
     effective on or after the date specified in the applicable 
     clause):
       ``(i) January 1, 2014, rated 40 percent or 30 percent.
       ``(ii) January 1, 2015, any rating.
       ``(3) Limited duration.--Notwithstanding the effective date 
     specified in each clause of subparagraphs (B) and (C) of 
     paragraph (2), the clause--
       ``(A) shall apply only if the termination date specified in 
     paragraph (1)(D) would occur during or after the calendar 
     year specified in the clause; and
       ``(B) shall not apply beyond the termination date specified 
     in paragraph (1)(D).''.
       (b) Conforming Amendment to Special Rules for Chapter 61 
     Disability Retirees.--Subsection (b) of such section is 
     amended to read as follows:
       ``(b) Special Rules for Chapter 61 Disability Retirees When 
     Eligibility Has Been Established for Such Retirees.--
       ``(1) General reduction rule.--The retired pay of a member 
     retired under chapter 61 of this title is subject to 
     reduction under sections 5304 and 5305 of title 38, but only 
     to the extent that the amount of the members retired pay 
     under chapter 61 of this title exceeds the amount of retired 
     pay to which the member would have been entitled under any 
     other provision of law based upon the member's service in the 
     uniformed services if the member had not been retired under 
     chapter 61 of this title.
       ``(2) Chapter 61 retirees not otherwise entitled to retired 
     pay.--
       ``(A) Before termination date.--If a member with a 
     qualifying service-connected disability (as defined in 
     subsection (a)(2)) is retired under chapter 61 of this title, 
     but is not otherwise entitled to retired pay under any other 
     provision of this title, and the termination date specified 
     in subsection (a)(1)(D) has not occurred, the retired pay of 
     the member is subject to reduction under sections 5304 and 
     5305 of title 38, but only to the extent that the amount of 
     the member's retired pay under chapter 61 of this title 
     exceeds the amount equal to 2\1/2\ percent of the member's 
     years of creditable service multiplied by the member's 
     retired pay base under section 1406(b)(1) or 1407 of this 
     title, whichever is applicable to the member.
       ``(B) After termination date.--Subsection (a) does not 
     apply to a member described in subparagraph (A) if the 
     termination date specified in subsection (a)(1)(D) has 
     occurred.''.
       (c) Conforming Amendment to Full Concurrent Receipt Phase-
     in.--Subsection (c) of such section is amended by striking 
     ``the second sentence of''.
       (d) Clerical Amendments.--
       (1) Section heading.--The heading of such section is 
     amended to read as follows:

     ``Sec. 1414. Concurrent receipt of retired pay and veterans' 
       disability compensation''.

       (2) Table of sections.--The table of sections at the 
     beginning of chapter 71 of such title is amended by striking 
     the item related to section 1414 and inserting the following 
     new item:

``1414. Concurrent receipt of retired pay and veterans' disability 
              compensation.''.

       (e) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2011.

     SEC. 610. EXTENSION OF USE OF 2009 POVERTY GUIDELINES.

       Section 1012 of the Department of Defense Appropriations 
     Act, 2010 (Public Law 111-118), as amended by section 6 of 
     the Continuing Extension Act of 2010 (Public Law 111-157), is 
     amended--
       (1) by striking ``before May 31, 2010''; and
       (2) by inserting ``for 2011'' after ``until updated poverty 
     guidelines''.

     SEC. 611. REFUNDS DISREGARDED IN THE ADMINISTRATION OF 
                   FEDERAL PROGRAMS AND FEDERALLY ASSISTED 
                   PROGRAMS.

       (a) In General.--Subchapter A of chapter 65 of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new section:

     ``SEC. 6409. REFUNDS DISREGARDED IN THE ADMINISTRATION OF 
                   FEDERAL PROGRAMS AND FEDERALLY ASSISTED 
                   PROGRAMS.

       ``(a) In General.--Notwithstanding any other provision of 
     law, any refund (or advance payment with respect to a 
     refundable credit) made to any individual under this title 
     shall not be taken into account as income, and shall not be 
     taken into account as resources for a period of 12 months 
     from receipt, for purposes of determining the eligibility of 
     such individual (or any other individual) for benefits or 
     assistance (or the amount or extent of benefits or 
     assistance) under any Federal program or under any State or 
     local program financed in whole or in part with Federal 
     funds.
       ``(b) Termination.--Subsection (a) shall not apply to any 
     amount received after December 31, 2010.''.
       (b) Clerical Amendment.--The table of sections for such 
     subchapter is amended by adding at the end the following new 
     item:

``Sec. 6409. Refunds disregarded in the administration of Federal 
              programs and federally assisted programs.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts received after December 31, 2009.

     SEC. 612. STATE COURT IMPROVEMENT PROGRAM.

       Section 438 of the Social Security Act (42 U.S.C. 629h) is 
     amended--
       (1) in subsection (c)(2)(A), by striking ``2010'' and 
     inserting ``2011''; and
       (2) in subsection (e), by striking ``2010'' and inserting 
     ``2011''.

     SEC. 613. QUALIFYING TIMBER CONTRACT OPTIONS.

       (a) Definitions.--In this section:
       (1) Qualifying contract.--The term ``qualifying contract'' 
     means a contract that has not been terminated by the Bureau 
     of Land Management for the sale of timber on lands 
     administered by the Bureau of Land Management that meets all 
     of the following criteria:

[[Page 10127]]

       (A) The contract was awarded during the period beginning on 
     January 1, 2005, and ending on December 31, 2008.
       (B) There is unharvested volume remaining for the contract.
       (C) The contract is not a salvage sale.
       (D) The Secretary determined there is not an urgent need to 
     harvest under the contract due to deteriorating timber 
     conditions that developed after the award of the contract.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior, acting through the Director of Bureau of 
     Land Management.
       (3) Timber purchaser.--The term ``timber purchaser'' means 
     the party to the qualifying contract for the sale of timber 
     from lands administered by the Bureau of Land Management.
       (b) Market-related Contract Extension Option.--Upon a 
     timber purchaser's written request, the Secretary may make a 
     one-time modification to the qualifying contract to add 3 
     years to the contract expiration date if the written 
     request--
       (1) is received by the Secretary not later than 90 days 
     after the date of enactment of this Act; and
       (2) contains a provision releasing the United States from 
     all liability, including further consideration or 
     compensation, resulting from the modification under this 
     subsection of the term of a qualifying contract.
       (c) Reporting.--Not later than 6 months after the date of 
     the enactment of this Act, the Secretary shall submit to 
     Congress a report detailing a plan and timeline to promulgate 
     new regulations authorizing the Bureau of Land Management to 
     extend timber contracts due to changes in market conditions.
       (d) Regulations.--Not later than 2 years after the date of 
     the enactment of this Act, the Secretary shall promulgate new 
     regulations authorizing the Bureau of Land Management to 
     extend timber contracts due to changes in market conditions.
       (e) No Surrender of Claims.--This section shall not have 
     the effect of surrendering any claim by the United States 
     against any timber purchaser that arose under a timber sale 
     contract, including a qualifying contract, before the date on 
     which the Secretary adjusts the contract term under 
     subsection (b).

     SEC. 614. EXTENSION AND FLEXIBILITY FOR CERTAIN ALLOCATED 
                   SURFACE TRANSPORTATION PROGRAMS.

       (a) Modification of Allocation Rules.--Section 411(d) of 
     the Surface Transportation Extension Act of 2010 (Public Law 
     111-147; 124 Stat. 80) is amended--
       (1) in paragraph (1)--
       (A) in the matter preceding subparagraph (A)--
       (i) by striking ``1301, 1302,''; and
       (ii) by striking ``1198, 1204,''; and
       (B) in subparagraph (A)--
       (i) in the matter preceding clause (i) by striking 
     ``apportioned under sections 104(b) and 144 of title 23, 
     United States Code,'' and inserting ``specified in section 
     105(a)(2) of title 23, United States Code (except the high 
     priority projects program),''; and
       (ii) in clause (ii) by striking ``apportioned under such 
     sections of such Code'' and inserting ``specified in such 
     section 105(a)(2) (except the high priority projects 
     program)'';
       (2) in paragraph (2)--
       (A) in the matter preceding subparagraph (A)--
       (i) by striking ``1301, 1302,''; and
       (ii) by striking ``1198, 1204,''; and
       (B) in subparagraph (A)--
       (i) in the matter preceding clause (i) by striking 
     ``apportioned under sections 104(b) and 144 of title 23, 
     United States Code,'' and inserting ``specified in section 
     105(a)(2) of title 23, United States Code (except the high 
     priority projects program),''; and
       (ii) in clause (ii) by striking ``apportioned under such 
     sections of such Code'' and inserting ``specified in such 
     section 105(a)(2) (except the high priority projects 
     program)''; and
       (3) by adding at the end the following:
       ``(5) Projects of national and regional significance and 
     national corridor infrastructure improvement programs.--
       ``(A) Redistribution among states.--Notwithstanding 
     sections 1301(m) and 1302(e) of SAFETEA-LU (119 Stat. 1202 
     and 1205), the Secretary shall apportion funds authorized to 
     be appropriated under subsection (b) for the projects of 
     national and regional significance program and the national 
     corridor infrastructure improvement program among all States 
     such that each State's share of the funds so apportioned is 
     equal to the State's share for fiscal year 2009 of funds 
     apportioned or allocated for the programs specified in 
     section 105(a)(2) of title 23, United States Code.
       ``(B) Distribution among programs.--Funds apportioned to a 
     State pursuant to subparagraph (A) shall be--
       ``(i) made available to the State for the programs 
     specified in section 105(a)(2) of title 23, United States 
     Code (except the high priority projects program), and in the 
     same proportion for each such program that--

       ``(I) the amount apportioned to the State for that program 
     for fiscal year 2009; bears to
       ``(II) the amount apportioned to the State for fiscal year 
     2009 for all such programs; and

       ``(ii) administered in the same manner and with the same 
     period of availability as funding is administered under 
     programs identified in clause (i).''.
       (b) Expenditure Authority From Highway Trust Fund.--
     Paragraph (1) of section 9503(c) of the Internal Revenue Code 
     of 1986 is amended by striking ``Surface Transportation 
     Extension Act of 2010'' and inserting ``American Jobs and 
     Closing Tax Loopholes Act of 2010''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect upon the date of enactment of the Surface 
     Transportation Extension Act of 2010 (Public Law 111-147; 124 
     Stat. 78 et seq.) and shall be treated as being included in 
     that Act at the time of the enactment of that Act.
       (d) Savings Clause.--
       (1) In general.--For fiscal year 2010 and for the period 
     beginning on October 1, 2010, and ending on December 31, 
     2010, the amount of funds apportioned to each State under 
     section 411(d) of the Surface Transportation Extension Act of 
     2010 (Public Law 111-147) that is determined by the amount 
     that the State received or was authorized to receive for 
     fiscal year 2009 to carry out the projects of national and 
     regional significance program and national corridor 
     infrastructure improvement program shall be the greater of--
       (A) the amount that the State was authorized to receive 
     under section 411(d) of the Surface Transportation Extension 
     Act of 2010 with respect to each such program according to 
     the provisions of that Act, as in effect on the day before 
     the date of enactment of this Act; or
       (B) the amount that the State is authorized to receive 
     under section 411(d) of the Surface Transportation Extension 
     Act of 2010 with respect to each such program pursuant to the 
     provisions of that Act, as amended by the amendments made by 
     this section.
       (2) Obligation authority.--For fiscal year 2010, the amount 
     of obligation authority distributed to each State shall be 
     the greater of--
       (A) the amount that the State was authorized to receive 
     pursuant to section 120(a)(4)(A) (as it pertains to the 
     Appalachian Development Highway System program) of title I of 
     division A of the Consolidated Appropriations Act, 2010 
     (Public Law 111-117) and sections 120(a)(4)(B) and 120(a)(6) 
     of such title, as of the day before the date of enactment of 
     this Act; or
       (B) the amount that the State is authorized to receive 
     pursuant to section 120(a)(4)(A) (as it pertains to the 
     Appalachian Development Highway System program) of title I of 
     division A of the Consolidated Appropriations Act, 2010 
     (Public Law 111-117) and sections 120(a)(4)(B) and 120(a)(6) 
     of such title, as of the date of enactment of this Act.
       (3) Authorization of appropriations.--There is authorized 
     to be appropriated out of the Highway Trust Fund (other than 
     the Mass Transit Account) such sums as may be necessary to 
     carry out this subsection.
       (4) Increase in obligation limitation.--The limitation 
     under the heading ``Federal-aid Highways (Limitation on 
     Obligations) (Highway Trust Fund)'' in Public Law 111-117 is 
     increased by such sums as may be necessary to carry out this 
     subsection.
       (5) Contract authority.--Funds made available to carry out 
     this subsection shall be available for obligation and 
     administered in the same manner as if such funds were 
     apportioned under chapter 1 of title 23, United States Code.
       (6) Amounts.--The dollar amount specified in section 
     105(d)(1) of title 23, United States Code, the dollar amount 
     specified in section 120(a)(4)(B) of title I of division A of 
     the Consolidated Appropriations Act, 2010 (Public Law 111-
     117), and the dollar amount specified in section 120(b)(10) 
     of such title shall each be increased as necessary to carry 
     out this subsection.

     SEC. 615. COMMUNITY COLLEGE AND CAREER TRAINING GRANT 
                   PROGRAM.

       (a) In General.--Section 278(a) of the Trade Act of 1974 
     (19 U.S.C. 2372(a)) is amended by adding at the end the 
     following:
       ``(3) Rule of construction.--For purposes of this section, 
     any reference to `workers', `workers eligible for training 
     under section 236', or any other reference to workers under 
     this section shall be deemed to include individuals who are, 
     or are likely to become, eligible for unemployment 
     compensation as defined in section 85(b) of the Internal 
     Revenue Code of 1986, or who remain unemployed after 
     exhausting all rights to such compensation.''.
       (b) Definition of Eligible Institution.--Section 278(b)(1) 
     of the Trade Act of 1974 (19 U.S.C. 2372(b)(1)) is amended--
       (1) by striking ``section 102'' and inserting ``section 
     101(a)''; and
       (2) by striking ``1002'' and inserting ``1001(a)''.
       (c) Authorization of Appropriations.--Section 279 of the 
     Trade Act of 1974 (19 U.S.C. 2372a) is amended--
       (1) in subsection (a), by striking the last sentence; and
       (2) by adding at the end the following:
       ``(c) Administrative and Related Costs.--The Secretary may 
     retain not more than 5 percent of the funds appropriated 
     under subsection (b) for each fiscal year to administer, 
     evaluate, and establish reporting systems for the Community 
     College and Career Training Grant program under section 278.
       ``(d) Supplement Not Supplant.--Funds appropriated under 
     subsection (b) shall be used to supplement and not supplant 
     other

[[Page 10128]]

     Federal, State, and local public funds expended to support 
     community college and career training programs.
       ``(e) Availability.--Funds appropriated under subsection 
     (b) shall remain available for the fiscal year for which the 
     funds are appropriated and the subsequent fiscal year.''.

     SEC. 616. EXTENSIONS OF DUTY SUSPENSIONS ON COTTON SHIRTING 
                   FABRICS AND RELATED PROVISIONS.

       (a) Extensions.--Each of the following headings of the 
     Harmonized Tariff Schedule of the United States is amended by 
     striking the date in the effective date column and inserting 
     ``12/31/2013'':
       (1) Heading 9902.52.08 (relating to woven fabrics of 
     cotton).
       (2) Heading 9902.52.09 (relating to woven fabrics of 
     cotton).
       (3) Heading 9902.52.10 (relating to woven fabrics of 
     cotton).
       (4) Heading 9902.52.11 (relating to woven fabrics of 
     cotton).
       (5) Heading 9902.52.12 (relating to woven fabrics of 
     cotton).
       (6) Heading 9902.52.13 (relating to woven fabrics of 
     cotton).
       (7) Heading 9902.52.14 (relating to woven fabrics of 
     cotton).
       (8) Heading 9902.52.15 (relating to woven fabrics of 
     cotton).
       (9) Heading 9902.52.16 (relating to woven fabrics of 
     cotton).
       (10) Heading 9902.52.17 (relating to woven fabrics of 
     cotton).
       (11) Heading 9902.52.18 (relating to woven fabrics of 
     cotton).
       (12) Heading 9902.52.19 (relating to woven fabrics of 
     cotton).
       (13) Heading 9902.52.20 (relating to woven fabrics of 
     cotton).
       (14) Heading 9902.52.21 (relating to woven fabrics of 
     cotton).
       (15) Heading 9902.52.22 (relating to woven fabrics of 
     cotton).
       (16) Heading 9902.52.23 (relating to woven fabrics of 
     cotton).
       (17) Heading 9902.52.24 (relating to woven fabrics of 
     cotton).
       (18) Heading 9902.52.25 (relating to woven fabrics of 
     cotton).
       (19) Heading 9902.52.26 (relating to woven fabrics of 
     cotton).
       (20) Heading 9902.52.27 (relating to woven fabrics of 
     cotton).
       (21) Heading 9902.52.28 (relating to woven fabrics of 
     cotton).
       (22) Heading 9902.52.29 (relating to woven fabrics of 
     cotton).
       (23) Heading 9902.52.30 (relating to woven fabrics of 
     cotton).
       (24) Heading 9902.52.31 (relating to woven fabrics of 
     cotton).
       (b) Extension of Duty Refunds and Pima Cotton Trust Fund; 
     Modification of Affidavit Requirements.--Section 407 of title 
     IV of division C of the Tax Relief and Health Care Act of 
     2006 (Public Law 109-432; 120 Stat. 3060) is amended--
       (1) in subsection (b)--
       (A) in paragraph (1), by striking ``amounts determined by 
     the Secretary'' and all that follows through ``5208.59.80'' 
     and inserting ``amounts received in the general fund that are 
     attributable to duties received since January 1, 2004, on 
     articles classified under heading 5208''; and
       (B) in paragraph (2), by striking ``October 1, 2008'' and 
     inserting ``December 31, 2013'';
       (2) in subsection (d)--
       (A) in the matter preceding paragraph (1), by inserting 
     ``annually'' after ``provided''; and
       (B) in paragraph (1), by inserting ``during the year in 
     which the affidavit is filed and'' after ``imported cotton 
     fabric''; and
       (3) in subsection (f)--
       (A) in the matter preceding paragraph (1), by inserting 
     ``annually'' after ``provided''; and
       (B) in paragraph (1), by inserting ``during the year in 
     which the affidavit is filed and'' after ``United States''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act 
     and apply with respect to affidavits filed on or after such 
     date of enactment.

     SEC. 617. MODIFICATION OF WOOL APPAREL MANUFACTURERS TRUST 
                   FUND.

       (a) In General.--Section 4002(c)(2)(A) of the Miscellaneous 
     Trade and Technical Corrections Act of 2004 (Public Law 108-
     429; 118 Stat. 2600) is amended by striking ``chapter 51'' 
     and inserting ``chapter 62''.
       (b) Full Restoration of Payment Levels in Fiscal Year 
     2010.--
       (1) Transfer of amounts.--
       (A) In general.--Not later than 30 days after the date of 
     the enactment of this Act, the Secretary of the Treasury 
     shall transfer to the Wool Apparel Manufacturers Trust Fund, 
     out of the general fund of the Treasury of the United States, 
     amounts determined by the Secretary of the Treasury to be 
     equivalent to amounts received in the general fund that are 
     attributable to the duty received on articles classified 
     under chapter 62 of the Harmonized Tariff Schedule of the 
     United States, subject to the limitation in subparagraph (B).
       (B) Limitation.--The Secretary of the Treasury shall not 
     transfer more than the amount determined by the Secretary to 
     be necessary for--
       (i) U.S. Customs and Border Protection to make payments to 
     eligible manufacturers under section 4002(c)(3) of the 
     Miscellaneous Trade and Technical Corrections Act of 2004 so 
     that the amount of such payments, when added to any other 
     payments made to eligible manufacturers under section 
     4002(c)(3) of such Act for calendar year 2010, equal the 
     total amount of payments authorized to be provided to 
     eligible manufacturers under section 4002(c)(3) of such Act 
     for calendar year 2010; and
       (ii) the Secretary of Commerce to provide grants to 
     eligible manufacturers under section 4002(c)(6) of the 
     Miscellaneous Trade and Technical Corrections Act of 2004 so 
     that the amounts of such grants, when added to any other 
     grants made to eligible manufacturers under section 
     4002(c)(6) of such Act for calendar year 2010, equal the 
     total amount of grants authorized to be provided to eligible 
     manufacturers under section 4002(c)(6) of such Act for 
     calendar year 2010.
       (2) Payment of amounts.--U.S. Customs and Border Protection 
     shall make payments described in paragraph (1) to eligible 
     manufacturers not later than 30 days after such transfer of 
     amounts from the general fund of the Treasury of the United 
     States to the Wool Apparel Manufacturers Trust Fund. The 
     Secretary of Commerce shall promptly provide grants described 
     in paragraph (1) to eligible manufacturers after such 
     transfer of amounts from the general fund of the Treasury of 
     the United States to the Wool Apparel Manufacturers Trust 
     Fund.
       (c) Rule of Construction.--The amendment made by subsection 
     (a) shall not be construed to affect the availability of 
     amounts transferred to the Wool Apparel Manufacturers Trust 
     Fund before the date of the enactment of this Act.

     SEC. 618. DEPARTMENT OF COMMERCE STUDY.

       Not later than 180 days after the date of enactment of this 
     Act, the Secretary of Commerce shall report to Congress 
     detailing--
       (1) the pattern of job loss in the New England, Mid-
     Atlantic, and Midwest States over the past 20 years;
       (2) the role of the off-shoring of manufacturing jobs in 
     overall job loss in the regions; and
       (3) recommendations to attract industries and bring jobs to 
     the region.

     SEC. 619. ARRA PLANNING AND REPORTING.

       Section 1512 of the American Recovery and Reinvestment Act 
     of 2009 (Public Law 111-5; 123 Stat. 287) is amended--
       (1) in subsection (d)--
       (A) in the subsection heading, by inserting ``Plans and'' 
     after ``Agency'';
       (B) by striking ``Not later than'' and inserting the 
     following:
       ``(1) Definition.--In this subsection, the term `covered 
     program' means a program for which funds are appropriated 
     under this division--
       ``(A) in an amount that is--
       ``(i) more than $2,000,000,000; and
       ``(ii) more than 150 percent of the funds appropriated for 
     the program for fiscal year 2008; or
       ``(B) that did not exist before the date of enactment of 
     this Act.
       ``(2) Plans.--Not later than July 1, 2010, the head of each 
     agency that distributes recovery funds shall submit to 
     Congress and make available on the website of the agency a 
     plan for each covered program, which shall, at a minimum, 
     contain--
       ``(A) a description of the goals for the covered program 
     using recovery funds;
       ``(B) a discussion of how the goals described in 
     subparagraph (A) relate to the goals for ongoing activities 
     of the covered program, if applicable;
       ``(C) a description of the activities that the agency will 
     undertake to achieve the goals described in subparagraph (A);
       ``(D) a description of the total recovery funding for the 
     covered program and the recovery funding for each activity 
     under the covered program, including identifying whether the 
     activity will be carried out using grants, contracts, or 
     other types of funding mechanisms;
       ``(E) a schedule of milestones for major phases of the 
     activities under the covered program, with planned delivery 
     dates;
       ``(F) performance measures the agency will use to track the 
     progress of each of the activities under the covered program 
     in meeting the goals described in subparagraph (A), including 
     performance targets, the frequency of measurement, and a 
     description of the methodology for each measure;
       ``(G) a description of the process of the agency for the 
     periodic review of the progress of the covered program 
     towards meeting the goals described in subparagraph (A); and
       ``(H) a description of how the agency will hold program 
     managers accountable for achieving the goals described in 
     subparagraph (A).
       ``(3) Reports.--
       ``(A) In general.--Not later than''; and
       (C) by adding at the end the following:
       ``(B) Reports on plans.--Not later than 30 days after the 
     end of the calendar quarter ending September 30, 2010, and 
     every calendar quarter thereafter during which the agency 
     obligates or expends recovery funds, the head of each agency 
     that developed a plan for a covered program under paragraph

[[Page 10129]]

     (2) shall submit to Congress and make available on a website 
     of the agency a report for each covered program that--
       ``(i) discusses the progress of the agency in implementing 
     the plan;
       ``(ii) describes the progress towards achieving the goals 
     described in paragraph (2)(A) for the covered program;
       ``(iii) discusses the status of each activity carried out 
     under the covered program, including whether the activity is 
     completed;
       ``(iv) details the unobligated and unexpired balances and 
     total obligations and outlays under the covered program;
       ``(v) discusses--

       ``(I) whether the covered program has met the milestones 
     for the covered program described in paragraph (2)(E);
       ``(II) if the covered program has failed to meet the 
     milestones, the reasons why; and
       ``(III) any changes in the milestones for the covered 
     program, including the reasons for the change;

       ``(vi) discusses the performance of the covered program, 
     including--

       ``(I) whether the covered program has met the performance 
     measures for the covered program described in paragraph 
     (2)(F);
       ``(II) if the covered program has failed to meet the 
     performance measures, the reasons why; and
       ``(III) any trends in information relating to the 
     performance of the covered program; and

       ``(vii) evaluates the ability of the covered program to 
     meet the goals of the covered program given the performance 
     of the covered program.'';
       (2) in subsection (f)--
       (A) by striking ``Within 180 days'' and inserting the 
     following:
       ``(1) In general.--Within 180 days''; and
       (B) by adding at the end the following:
       ``(2) Penalties.--
       ``(A) In general.--Subject to subparagraphs (B), (C), and 
     (D), the Attorney General may bring a civil action in an 
     appropriate United States district court against a recipient 
     of recovery funds from an agency that does not provide the 
     information required under subsection (c) or knowingly 
     provides information under subsection (c) that contains a 
     material omission or misstatement. In a civil action under 
     this paragraph, the court may impose a civil penalty on a 
     recipient of recovery funds in an amount not more than 
     $250,000. Any amounts received from a civil penalty under 
     this paragraph shall be deposited in the general fund of the 
     Treasury.
       ``(B) Notification.--
       ``(i) In general.--The head of an agency shall provide a 
     written notification to a recipient of recovery funds from 
     the agency that fails to provide the information required 
     under subsection (c). A notification under this subparagraph 
     shall provide the recipient with information on how to comply 
     with the necessary reporting requirements and notice of the 
     penalties for failing to do so.
       ``(ii) Limitation.--A court may not impose a civil penalty 
     under subparagraph (A) relating to the failure to provide 
     information required under subsection (c) if, not later than 
     31 days after the date of the notification under clause (i), 
     the recipient of the recovery funds provides the information.
       ``(C) Considerations.--In determining the amount of a 
     penalty under this paragraph for a recipient of recovery 
     funds, a court shall consider--
       ``(i) the number of times the recipient has failed to 
     provide the information required under subsection (c);
       ``(ii) the amount of recovery funds provided to the 
     recipient;
       ``(iii) whether the recipient is a government, nonprofit 
     entity, or educational institution; and
       ``(iv) whether the recipient is a small business concern 
     (as defined under section 3 of the Small Business Act (15 
     U.S.C. 632)), with particular consideration given to 
     businesses with not more than 50 employees.
       ``(D) Applicability.--This paragraph shall apply to any 
     report required to be submitted on or after the date of 
     enactment of this paragraph.
       ``(E) Nonexclusivity.--The imposition of a civil penalty 
     under this subsection shall not preclude any other criminal, 
     civil, or administrative remedy available to the United 
     States or any other person under Federal or State law.
       ``(3) Technical assistance.--Each agency distributing 
     recovery funds shall provide technical assistance, as 
     necessary, to assist recipients of recovery funds in 
     complying with the requirements to provide information under 
     subsection (c), which shall include providing recipients with 
     a reminder regarding each reporting requirement.
       ``(4) Public listing.--
       ``(A) In general.--Not later than 45 days after the end of 
     each calendar quarter, and subject to the notification 
     requirements under paragraph (2)(B), the Board shall make 
     available on the website established under section 1526 a 
     list of all recipients of recovery funds that did not provide 
     the information required under subsection (c) for the 
     calendar quarter.
       ``(B) Contents.--A list made available under subparagraph 
     (A) shall, for each recipient of recovery funds on the list, 
     include the name and address of the recipient, the 
     identification number for the award, the amount of recovery 
     funds awarded to the recipient, a description of the activity 
     for which the recovery funds were provided, and, to the 
     extent known by the Board, the reason for noncompliance.
       ``(5) Regulations and reporting.--
       ``(A) Regulations.--Not later than 90 days after the date 
     of enactment of this paragraph, the Attorney General, in 
     consultation with the Director of the Office of Management 
     and Budget and the Chairperson, shall promulgate regulations 
     regarding implementation of this section.
       ``(B) Reporting.--
       ``(i) In general.--Not later than July 1, 2010, and every 3 
     months thereafter, the Director of the Office of Management 
     and Budget, in consultation with the Chairperson, shall 
     submit to Congress a report on the extent of noncompliance by 
     recipients of recovery funds with the reporting requirements 
     under this section.
       ``(ii) Contents.--Each report submitted under clause (i) 
     shall include--

       ``(I) information, for the quarter and in total, regarding 
     the number and amount of civil penalties imposed and 
     collected under this subsection, sorted by agency and 
     program;
       ``(II) information on the steps taken by the Federal 
     Government to reduce the level of noncompliance; and
       ``(III) any other information determined appropriate by the 
     Director.''; and

       (3) by adding at the end the following:
       ``(i) Termination.--The reporting requirements under this 
     section shall terminate on September 30, 2013.''.

     SEC. 620. AMENDMENT OF TRAVEL PROMOTION ACT OF 2009.

       (a) Travel Promotion Fund Fees.--Section 217(h)(3)(B) of 
     the Immigration and Nationality Act (8 U.S.C. 1187(h)(3)(B)) 
     is amended--
       (1) by striking ``subsection (d) of section 11 of the 
     Travel Promotion Act of 2009.'' in clause (ii) and inserting 
     ``subsection (d) of the Travel Promotion Act of 2009 (22 
     U.S.C. 2131(d)).''; and
       (2) by striking ``September 30, 2014.'' in clause (iii) and 
     inserting ``September 30, 2015.''.
       (b) Implementation Beginning in Fiscal Year 2011.--
     Subsection (d) of the Travel Promotion Act of 2009 (22 U.S.C. 
     2131(d)) is amended--
       (1) by striking ``For fiscal year 2010, the'' in paragraph 
     (2)(A) and inserting ``The'';
       (2) by striking ``quarterly, beginning on January 1, 
     2010,'' in paragraph (2)(A) and inserting ``monthly, 
     immediately following the collection of fees under section 
     217(h)(3)(B)(i)(I) of the Immigration and Nationality Act (8 
     U.S.C. 1187(h)(3)(B)(i)(I),'';
       (3) by striking ``fiscal years 2011 through 2014,'' in 
     paragraph (2)(B) and inserting ``fiscal years 2012 through 
     2015,'';
       (4) by striking ``fiscal year 2010,'' in paragraph (3)(A) 
     and inserting ``fiscal year 2011,'';
       (5) by striking ``fiscal year 2011,'' each place it appears 
     in paragraph (3)(A) and inserting ``fiscal year 2012,''; and
       (6) by striking ``fiscal year 2010, 2011, 2012, 2013, or 
     2014'' in paragraph (4)(B) and inserting ``fiscal year 2011, 
     2012, 2013, 2014, or 2015''.

                    TITLE VII--BUDGETARY PROVISIONS

     SEC. 701. BUDGETARY PROVISIONS.

       (a) Statutory Paygo.--The budgetary effects of this Act, 
     for the purpose of complying with the Statutory Pay-As-You-Go 
     Act of 2010, shall be determined by reference to the latest 
     statement titled `Budgetary Effects of PAYGO Legislation' for 
     this Act, jointly submitted for printing in the Congressional 
     Record by the Chairmen of the House and Senate Budget 
     Committees, provided that such statement has been submitted 
     prior to the vote on passage in the House acting first on 
     this conference report or amendment between the Houses.
       (b) Emergency Designations.--Sections 501 and 524--
       (1) are designated as an emergency requirement pursuant to 
     section 4(g) of the Statutory Pay-As-You-Go Act of 2010 
     (Public Law 111-139; 2 U.S.C. 933(g));
       (2) in the House of Representatives, are designated as an 
     emergency for purposes of pay-as-you-go principles; and
       (3) in the Senate, are designated as an emergency 
     requirement pursuant to section 403(a) of S. Con. Res. 13 
     (111th Congress), the concurrent resolution on the budget for 
     fiscal year 2010.
                                 ______
                                 
  SA 4302. Mr. CORNYN (for himself and Mr. Kyl) submitted an amendment 
intended to be proposed to amendment SA 4301 proposed by Mr. Baucus to 
the bill H.R. 4213, to amend the Internal Revenue Code of 1986 to 
extend certain expiring provisions, and for other purposes; as follows:

       At the appropriate place, add the following:

       TITLE __--TRANSPARENCY REQUIREMENTS FOR FOREIGN-HELD DEBT

     SEC. _01. SHORT TITLE.

       This title may be cited as the ``Foreign-Held Debt 
     Transparency and Threat Assessment Act''.

     SEC. _02. DEFINITIONS.

       In this title:

[[Page 10130]]

       (1) Appropriate congressional committees.--The term 
     ``appropriate congressional committees'' means the following:
       (A) The Committee on Armed Services, the Committee on 
     Foreign Relations, the Committee on Finance, and the 
     Committee on the Budget of the Senate.
       (B) The Committee on Armed Services, the Committee on 
     Foreign Affairs, the Committee on Ways and Means, and the 
     Committee on the Budget of the House of Representatives.
       (2) Debt instruments of the united states.--The term ``debt 
     instruments of the United States'' means all bills, notes, 
     and bonds issued or guaranteed by the United States or by an 
     entity of the United States Government, including any 
     Government-sponsored enterprise.

     SEC. _03. SENSE OF CONGRESS.

       It is the sense of Congress that--
       (1) the growing Federal debt of the United States has the 
     potential to jeopardize the national security and economic 
     stability of the United States;
       (2) the increasing dependence of the United States on 
     foreign creditors has the potential to make the United States 
     vulnerable to undue influence by certain foreign creditors in 
     national security and economic policymaking;
       (3) the People's Republic of China is the largest foreign 
     creditor of the United States, in terms of its overall 
     holdings of debt instruments of the United States;
       (4) the current level of transparency in the scope and 
     extent of foreign holdings of debt instruments of the United 
     States is inadequate and needs to be improved, particularly 
     regarding the holdings of the People's Republic of China;
       (5) through the People's Republic of China's large holdings 
     of debt instruments of the United States, China has become a 
     super creditor of the United States;
       (6) under certain circumstances, the holdings of the 
     People's Republic of China could give China a tool with which 
     China can try to manipulate the domestic and foreign 
     policymaking of the United States, including the United 
     States relationship with Taiwan;
       (7) under certain circumstances, if the People's Republic 
     of China were to be displeased with a given United States 
     policy or action, China could attempt to destabilize the 
     United States economy by rapidly divesting large portions of 
     China's holdings of debt instruments of the United States; 
     and
       (8) the People's Republic of China's expansive holdings of 
     such debt instruments of the United States could potentially 
     pose a direct threat to the United States economy and to 
     United States national security. This potential threat is a 
     significant issue that warrants further analysis and 
     evaluation.

     SEC. _04. QUARTERLY REPORT ON RISKS POSED BY FOREIGN HOLDINGS 
                   OF DEBT INSTRUMENTS OF THE UNITED STATES.

       (a) Quarterly Report.--Not later than March 31, June 30, 
     September 30, and December 31 of each year, the President 
     shall submit to the appropriate congressional committees a 
     report on the risks posed by foreign holdings of debt 
     instruments of the United States, in both classified and 
     unclassified form.
       (b) Matters To Be Included.--Each report submitted under 
     this section shall include the following:
       (1) The most recent data available on foreign holdings of 
     debt instruments of the United States, which data shall not 
     be older than the date that is 7 months preceding the date of 
     the report.
       (2) The country of domicile of all foreign creditors who 
     hold debt instruments of the United States.
       (3) The total amount of debt instruments of the United 
     States that are held by the foreign creditors, broken out by 
     the creditors' country of domicile and by public, quasi-
     public, and private creditors.
       (4) For each foreign country listed in paragraph (3)--
       (A) an analysis of the country's purpose in holding debt 
     instruments of the United States and long-term intentions 
     with regard to such debt instruments;
       (B) an analysis of the current and foreseeable risks to the 
     long-term national security and economic stability of the 
     United States posed by each country's holdings of debt 
     instruments of the United States; and
       (C) a specific determination of whether the level of risk 
     identified under subparagraph (B) is acceptable or 
     unacceptable.
       (c) Public Availability.--The President shall make each 
     report required by subsection (a) available, in its 
     unclassified form, to the public by posting it on the 
     Internet in a conspicuous manner and location.

     SEC. _05. ANNUAL REPORT ON RISKS POSED BY THE FEDERAL DEBT OF 
                   THE UNITED STATES.

       (a) In General.--Not later than December 31 of each year, 
     the Comptroller General of the United States shall submit to 
     the appropriate congressional committees a report on the 
     risks to the United States posed by the Federal debt of the 
     United States.
       (b) Content of Report.--Each report submitted under this 
     section shall include the following:
       (1) An analysis of the current and foreseeable risks to the 
     long-term national security and economic stability of the 
     United States posed by the Federal debt of the United States.
       (2) A specific determination of whether the levels of risk 
     identified under paragraph (1) are sustainable.
       (3) If the determination under paragraph (2) is that the 
     levels of risk are unsustainable, specific recommendations 
     for reducing the levels of risk to sustainable levels, in a 
     manner that results in a reduction in Federal spending.

     SEC. _06. CORRECTIVE ACTION TO ADDRESS UNACCEPTABLE AND 
                   UNSUSTAINABLE RISKS TO UNITED STATES NATIONAL 
                   SECURITY AND ECONOMIC STABILITY.

       In any case in which the President determines under section 
     ___04(b)(4)(C) that a foreign country's holdings of debt 
     instruments of the United States pose an unacceptable risk to 
     the long-term national security or economic stability of the 
     United States, or the Comptroller General of the United 
     States makes a determination under section ___5(b)(3), the 
     President shall, within 30 days of the determination--
       (1) formulate a plan of action to reduce the risk level to 
     an acceptable and sustainable level, in a manner that results 
     in a reduction in Federal spending;
       (2) submit to the appropriate congressional committees a 
     report on the plan of action that includes a timeline for the 
     implementation of the plan and recommendations for any 
     legislative action that would be required to fully implement 
     the plan; and
       (3) move expeditiously to implement the plan in order to 
     protect the long-term national security and economic 
     stability of the United States.
                                 ______
                                 
  SA 4303. Mr. SESSIONS (for himself and Mrs. McCaskill) proposed an 
amendment to amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 
4213, to amend the Internal Revenue Code of 1986 to extend certain 
expiring provisions, and for other purposes; as follows:

       At the end of the amendment, insert the following:

     SEC. ___. DISCRETIONARY SPENDING LIMITS.

       (a) Point of Order.--It shall not be in order in the House 
     of Representatives or the Senate to consider any bill, joint 
     resolution, amendment, or conference report that includes any 
     provision that would cause the discretionary spending limits 
     as set forth in this section to be exceeded.
       (b) Limits.--In this section, the term ``discretionary 
     spending limits'' has the following meaning subject to 
     adjustments in subsection (c):
       (1) For fiscal year 2011--
       (A) for the defense category (budget function 050), 
     $564,293,000,000 in budget authority; and
       (B) for the nondefense category, $540,116,000,000 in budget 
     authority.
       (2) For fiscal year 2012--
       (A) for the defense category (budget function 050), 
     $573,612,000,000 in budget authority; and
       (B) for the nondefense category, $543,790,000,000 in budget 
     authority.
       (3) For fiscal year 2013--
       (A) for the defense category (budget function 050), 
     $584,421,000,000 in budget authority; and
       (B) for the nondefense category, $551,498,000,000 in budget 
     authority.
       (4) With respect to fiscal years following 2013, the 
     President shall recommend and the Congress shall consider 
     legislation setting limits for those fiscal years.
       (c) Adjustments.--
       (1) In general.--After the reporting of a bill or joint 
     resolution relating to any matter described in paragraph (2), 
     or the offering of an amendment thereto or the submission of 
     a conference report thereon--
       (A) the Chairman of the Senate Committee on the Budget may 
     adjust the discretionary spending limits, the budgetary 
     aggregates in the concurrent resolution on the budget most 
     recently adopted by the Senate and the House of 
     Representatives, and allocations pursuant to section 302(a) 
     of the Congressional Budget Act of 1974, by the amount of new 
     budget authority in that measure for that purpose and the 
     outlays flowing there from; and
       (B) following any adjustment under subparagraph (A), the 
     Senate Committee on Appropriations may report appropriately 
     revised suballocations pursuant to section 302(b) of the 
     Congressional Budget Act of 1974 to carry out this 
     subsection.
       (2) Matters described.--Matters referred to in paragraph 
     (1) are as follows:
       (A) Overseas deployments and other activities.--If a bill 
     or joint resolution is reported making appropriations for 
     fiscal year 2011, 2012, or 2013, that provides funding for 
     overseas deployments and other activities, the adjustment for 
     purposes paragraph (1) shall be the amount of budget 
     authority in that measure for that purpose but not to 
     exceed--
       (i) with respect to fiscal year 2011, $50,000,000,000 in 
     new budget authority;
       (ii) with respect to fiscal year 2012, $50,000,000,000 in 
     new budget authority; and
       (iii) with respect to fiscal year 2013, $50,000,000,000 in 
     new budget authority.
       (B) Internal revenue service tax enforcement.--

[[Page 10131]]

       (i) In general.--If a bill or joint resolution is reported 
     making appropriations for fiscal year 2011, 2012, or 2013, 
     that includes the amount described in clause (ii)(I), plus an 
     additional amount for enhanced tax enforcement to address the 
     Federal tax gap (taxes owed but not paid) described in clause 
     (ii)(II), the adjustment for purposes of paragraph (1) shall 
     be the amount of budget authority in that measure for that 
     initiative not exceeding the amount specified in clause 
     (ii)(II) for that fiscal year.
       (ii) Amounts.--The amounts referred to in clause (i) are as 
     follows:

       (I) For fiscal year 2011, $7,171,000,000, for fiscal year 
     2012, $7,243,000,000, and for fiscal year 2013, 
     $7,315,000,000.
       (II) For fiscal year 2011, $899,000,000, for fiscal year 
     2012, and $908,000,000, for fiscal year 2013, $917,000,000.

       (C) Continuing disability reviews and ssi 
     redeterminations.--
       (i) In general.--If a bill or joint resolution is reported 
     making appropriations for fiscal year 2011, 2012, or 2013 
     that includes the amount described in clause (ii)(I), plus an 
     additional amount for Continuing Disability Reviews and 
     Supplemental Security Income Redeterminations for the Social 
     Security Administration described in clause (ii)(II), the 
     adjustment for purposes of paragraph (1) shall be the amount 
     of budget authority in that measure for that initiative not 
     exceeding the amount specified in clause (ii)(II) for that 
     fiscal year.
       (ii) Amounts.--The amounts referred to in clause (i) are as 
     follows:

       (I) For fiscal year 2011, $276,000,000, for fiscal year 
     2012, $278,000,000, and for fiscal year 2013, $281,000,000.
       (II) For fiscal year 2011, $490,000,000; for fiscal year 
     2012, and $495,000,000; for fiscal year 2013, $500,000,000.

       (iii) Asset verification.--

       (I) In general.--The additional appropriation permitted 
     under clause (ii)(II) may also provide that a portion of that 
     amount, not to exceed the amount specified in subclause (II) 
     for that fiscal year instead may be used for asset 
     verification for Supplemental Security Income recipients, but 
     only if, and to the extent that the Office of the Chief 
     Actuary estimates that the initiative would be at least as 
     cost effective as the redeterminations of eligibility 
     described in this subparagraph.
       (II) Amounts.--For fiscal year 2011, $34,340,000, for 
     fiscal year 2012, $34,683,000, and for fiscal year 2013, 
     $35,030,000.

       (D) Health care fraud and abuse.--
       (i) In general.--If a bill or joint resolution is reported 
     making appropriations for fiscal year 2011, 2012, or 2013 
     that includes the amount described in clause (ii) for the 
     Health Care Fraud and Abuse Control program at the Department 
     of Health & Human Services for that fiscal year, the 
     adjustment for purposes of paragraph (1) shall be the amount 
     of budget authority in that measure for that initiative but 
     not to exceed the amount described in clause (ii).
       (ii) Amount.--The amount referred to in clause (i) is for 
     fiscal year 2011, $314,000,000, for fiscal year 2012, 
     $317,000,000, and for fiscal year 2013, $320,000,000.
       (E) Unemployment insurance improper payment reviews.--If a 
     bill or joint resolution is reported making appropriations 
     for fiscal year 2011, 2012, or 2013 that includes 
     $10,000,000, plus an additional amount for in-person 
     reemployment and eligibility assessments and unemployment 
     improper payment reviews for the Department of Labor, the 
     adjustment for purposes paragraph (1) shall be the amount of 
     budget authority in that measure for that initiative but not 
     to exceed--
       (i) with respect to fiscal year 2011, $51,000,000 in new 
     budget authority;
       (ii) with respect to fiscal year 2012, $51,000,000 in new 
     budget authority; and
       (iii) with respect to fiscal year 2013, $52,000,000 in new 
     budget authority.
       (F) Low-income home energy assistance program (liheap).--If 
     a bill or joint resolution is reported making appropriations 
     for fiscal year 2011, 2012, or 2013 that includes 
     $3,200,000,000 in funding for the Low-Income Home Energy 
     Assistance Program and provides an additional amount up to 
     $1,900,000,000 for that program, the adjustment for purposes 
     of paragraph (1) shall be the amount of budget authority in 
     that measure for that initiative but not to exceed 
     $1,900,000,000.
       (d) Emergency Spending.--
       (1) Authority to designate.--In the Senate, with respect to 
     a provision of direct spending or receipts legislation or 
     appropriations for discretionary accounts that Congress 
     designates as an emergency requirement in such measure, the 
     amounts of new budget authority, outlays, and receipts in all 
     fiscal years resulting from that provision shall be treated 
     as an emergency requirement for the purpose of this 
     subsection.
       (2) Exemption of emergency provisions.--Any new budget 
     authority, outlays, and receipts resulting from any provision 
     designated as an emergency requirement, pursuant to this 
     subsection, in any bill, joint resolution, amendment, or 
     conference report shall not count for purposes of this 
     section, sections 302 and 311 of this Act, section 201 of S. 
     Con. Res. 21 (110th Congress) (relating to pay-as-you-go), 
     section 311 of S. Con. Res. 70 (110th Congress) (relating to 
     long-term deficits), and section 404 of S. Con. Res. 13 
     (111th Congress).
       (3) Designations.--If a provision of legislation is 
     designated as an emergency requirement under this subsection, 
     the committee report and any statement of managers 
     accompanying that legislation shall include an explanation of 
     the manner in which the provision meets the criteria in 
     paragraph (6).
       (4) Definitions.--In this subsection, the terms ``direct 
     spending'', ``receipts'', and ``appropriations for 
     discretionary accounts'' mean any provision of a bill, joint 
     resolution, amendment, motion, or conference report that 
     affects direct spending, receipts, or appropriations as those 
     terms have been defined and interpreted for purposes of the 
     Balanced Budget and Emergency Deficit Control Act of 1985.
       (5) Point of order.--
       (A) In general.--When the Senate is considering a bill, 
     resolution, amendment, motion, or conference report, if a 
     point of order is made by a Senator against an emergency 
     designation in that measure, that provision making such a 
     designation shall be stricken from the measure and may not be 
     offered as an amendment from the floor.
       (B) Supermajority waiver and appeals.--
       (i) Waiver.--Subparagraph (A) may be waived or suspended in 
     the Senate only by an affirmative vote of three-fifths of the 
     Members, duly chosen and sworn.
       (ii) Appeals.--Appeals in the Senate from the decisions of 
     the Chair relating to any provision of this paragraph shall 
     be limited to 1 hour, to be equally divided between, and 
     controlled by, the appellant and the manager of the bill or 
     joint resolution, as the case may be. An affirmative vote of 
     three-fifths of the Members of the Senate, duly chosen and 
     sworn, shall be required to sustain an appeal of the ruling 
     of the Chair on a point of order raised under this paragraph.
       (C) Definition of an emergency designation.--For purposes 
     of subparagraph (A), a provision shall be considered an 
     emergency designation if it designates any item as an 
     emergency requirement pursuant to this paragraph.
       (D) Form of the point of order.--A point of order under 
     subparagraph (A) may be raised by a Senator as provided in 
     section 313(e) of the Congressional Budget Act of 1974.
       (E) Conference reports.--When the Senate is considering a 
     conference report on, or an amendment between the Houses in 
     relation to, a bill, upon a point of order being made by any 
     Senator pursuant to this paragraph, and such point of order 
     being sustained, such material contained in such conference 
     report shall be deemed stricken, and the Senate shall proceed 
     to consider the question of whether the Senate shall recede 
     from its amendment and concur with a further amendment, or 
     concur in the House amendment with a further amendment, as 
     the case may be, which further amendment shall consist of 
     only that portion of the conference report or House 
     amendment, as the case may be, not so stricken. Any such 
     motion in the Senate shall be debatable. In any case in which 
     such point of order is sustained against a conference report 
     (or Senate amendment derived from such conference report by 
     operation of this subsection), no further amendment shall be 
     in order.
       (6) Criteria.--
       (A) In general.--For purposes of this subsection, any 
     provision is an emergency requirement if the situation 
     addressed by such provision is--
       (i) necessary, essential, or vital (not merely useful or 
     beneficial);
       (ii) sudden, quickly coming into being, and not building up 
     over time;
       (iii) an urgent, pressing, and compelling need requiring 
     immediate action;
       (iv) subject to clause (ii), unforeseen, unpredictable, and 
     unanticipated; and
       (v) not permanent, temporary in nature.
       (7) Unforeseen.--An emergency that is part of an aggregate 
     level of anticipated emergencies, particularly when normally 
     estimated in advance, is not unforeseen.
       (e) Limitations on Changes to Exemptions.--It shall not be 
     in order in the Senate or the House of Representatives to 
     consider any bill, resolution, amendment, or conference 
     report that would exempt any new budget authority, outlays, 
     and receipts from being counted for purposes of this section.
       (f) Point of Order in the Senate.--
       (1) Waiver.--The provisions of subsections (a)-(e) of this 
     section shall be waived or suspended in the Senate only--
       (A) by the affirmative vote of two-thirds of the Members, 
     duly chosen and sworn; or
       (B) in the case of the defense budget authority, if 
     Congress declares war or authorizes the use of force.
       (2) Appeal.--Appeals in the Senate from the decisions of 
     the Chair relating to any provision of this section shall be 
     limited to 1 hour, to be equally divided between, and 
     controlled by, the appellant and the manager of the measure. 
     An affirmative vote of two-thirds of the Members of the 
     Senate, duly chosen and sworn, shall be required to sustain 
     an appeal of the ruling of the Chair on a point of order 
     raised under this section.
       (g) Limitations on Changes to this Section.--It shall not 
     be in order in the Senate or the House of Representatives to 
     consider

[[Page 10132]]

     any bill, resolution, amendment, or conference report that 
     would repeal or otherwise change this section.
                                 ______
                                 
  SA 4304. Mr. CARDIN (for himself, Ms. Mikulski, Mr. Casey, Mr. 
Kaufman, Mrs. Hagan, and Mr. Begich) submitted an amendment intended to 
be proposed to amendment SA 4301 proposed by Mr. Baucus to the bill 
H.R. 4213, to amend the Internal Revenue Code of 1986 to extend certain 
expiring provisions, and for other purposes; as follows:

       At the appropriate place, insert the following:

     SEC. ____. EXTENSION OF DEPENDENT COVERAGE UNDER FEHBP.

       (a) Short Title.--This section may be cited as the ``FEHBP 
     Dependent Coverage Extension Act''.
       (b) In General.--
       (1) Provisions relating to age.--Chapter 89 of title 5, 
     United States Code, is amended--
       (A) in section 8901(5)--
       (i) in the matter before subparagraph (A), by striking ``22 
     years of age'' and inserting ``26 years of age''; and
       (ii) in the matter after subparagraph (B), by striking 
     ``age 22'' and inserting ``age 26''; and
       (B) in section 8905(c)(2)(B)--
       (i) in clause (i), by striking ``22 years of age'' and 
     inserting ``26 years of age''; and
       (ii) in clause (ii), by striking ``age 22'' and inserting 
     ``age 26''.
       (2) Provisions relating to marital status.--Chapter 89 of 
     title 5, United States Code, is further amended--
       (A) in section 8901(5) and subsections (b)(2)(A), 
     (c)(2)(B), (e)(1)(B), and (e)(2)(A) of section 8905a, by 
     striking ``an unmarried dependent'' each place it appears and 
     inserting ``a dependent''; and
       (B) in section 8905(c)(2)(B), by striking ``unmarried 
     dependent'' and inserting ``dependent''.
       (c) Effective Date.--The amendments made by this section 
     shall become effective as if included in the enactment of 
     section 1001 of the Patient Protection and Affordable Care 
     Act (Public Law 111-148), except that the Director of the 
     Office of Personnel Management may implement such amendments 
     for such periods before the effective date otherwise provided 
     in section 1004(a) of such Act as the Director may specify.
                                 ______
                                 
  SA 4305. Mr. WICKER submitted an amendment intended to be proposed to 
amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       At the end of subpart B of part II of subtitle D of title 
     II, add the following:

     SEC. ____. TAX-EXEMPT BOND FINANCING.

       (a) In General.--Paragraphs (2)(D) and (7)(C) of section 
     1400N(a) are each amended by striking ``January 1, 2011'' and 
     inserting ``January 1, 2012''.
       (b) Conforming Amendments.--Sections 702(d)(1) and 704(a) 
     of the Heartland Disaster Tax Relief Act of 2008 (Public Law 
     110-343; 122 Stat. 3913, 3919) are each amended by striking 
     ``January 1, 2011'' each place it appears and inserting 
     ``January 1, 2012''.
                                 ______
                                 
  SA 4306. Mr. WICKER submitted an amendment intended to be proposed to 
amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       At the end of subpart B of part II of subtitle D of title 
     II, add the following:

     SEC. ___. SPECIAL DEPRECIATION ALLOWANCE.

       (a) In General.--Paragraph (6) of section 1400N(d)(6) is 
     amended by striking subparagraph (D).
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2009.
                                 ______
                                 
  SA 4307. Mr. BEGICH submitted an amendment intended to be proposed to 
amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       At the end of title VI, insert the following:

     SEC. 6__. ENCOURAGEMENT OF CONTRIBUTIONS OF CAPITAL GAIN REAL 
                   PROPERTY MADE FOR CONSERVATION PURPOSES BY 
                   NATIVE CORPORATIONS.

       (a) In General.--Paragraph (2) of section 170(b) of the 
     Internal Revenue Code of 1986 is amended by redesignating 
     subparagraph (C) as subparagraph (D), and by inserting after 
     subparagraph (B) the following new subparagraph:
       ``(C) Qualified conservation contributions by certain 
     native corporations.--
       ``(i) In general.--Any qualified conservation contribution 
     (as defined in subsection (h)(1)) which--

       ``(I) is made by a Native Corporation, and
       ``(II) is a contribution of property which was land 
     conveyed under the Alaska Native Claims Settlement Act,

     shall be allowed to the extent that the aggregate amount of 
     such contributions does not exceed the excess of the 
     taxpayer's taxable income over the amount of charitable 
     contributions allowable under subparagraph (A).
       ``(ii) Limitation.--This subparagraph shall not apply to 
     any contribution of property described in clause (i)(II) 
     which, by itself or when aggregated to any other property to 
     which this subparagraph applies, is a contribution of more 
     than 10 percent of the land conveyed to the Native 
     Corporation described in clause (i)(I) under the Alaska 
     Native Claims Settlement Act.
       ``(iii) Carryover.--If the aggregate amount of 
     contributions described in clause (i) exceeds the limitation 
     of clause (i), such excess shall be treated (in a manner 
     consistent with the rules of subsection (d)(2)) as a 
     charitable contribution to which clause (i) applies in each 
     of the 5 succeeding years in order of time.
       ``(iv) Definition.--For purposes of this subparagraph, the 
     term `Native Corporation' has the meaning given such term by 
     section 3(m) of the Alaska Native Claims Settlement Act.
       ``(v) Termination.--This subparagraph shall not apply to 
     any contribution in any taxable year beginning after December 
     31, 2010.''.
       (b) Conforming Amendment.--Section 170(b)(2)(A) of such 
     Code is amended by striking ``subparagraph (B) applies'' and 
     inserting ``subparagraphs (B) or (C) apply''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to contributions made after the date of the 
     enactment of this Act.
       (d) Rule of Construction.--Nothing in this section or the 
     amendments made by this section shall be construed to modify 
     any existing property rights conveyed to Native Corporations 
     (withing the meaning of section 3(m) of the Alaska Native 
     Claims Settlement Act) under such Act.

     SEC. 6__. INCREASE IN PENALTY FOR FAILURE TO FILE A 
                   PARTNERSHIP OR S CORPORATION RETURN.

       (a) In General.--Sections 6698(b)(1) and 6699(b)(1) of the 
     Internal Revenue Code of 1986 are each amended by striking 
     ``$195'' and inserting ``$205''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to returns for taxable years beginning after 
     December 31, 2010.
                                 ______
                                 
  SA 4308. Mr. SCHUMER submitted an amendment intended to be proposed 
to amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       On page 64, between lines 18 and 19, insert the following:

     SEC. 293. SPECIAL INVESTMENT RULE FOR CERTAIN QUALIFIED NEW 
                   YORK LIBERTY BOND PROCEEDS.

       For purposes of section 149(g) of the Internal Revenue Code 
     of 1986, the proceeds of any qualified New York Liberty Bond 
     (as defined in section 1400L(d)(2)) issued after September 
     30, 2009, and before January 1, 2010, which are invested in 
     United States Treasury Obligations - State and Local 
     Government Series shall be treated as invested in bonds 
     described in paragraph (3)(B)(i) of such section.
                                 ______
                                 
  SA 4309. Mr. SCHUMER submitted an amendment intended to be proposed 
to amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       At the end of title VI, insert the following:

     SEC. 6__. CHARITABLE DEDUCTION FOR COSTS ASSOCIATED WITH 
                   DONATIONS OF WILD GAME MEAT.

       (a) In General.--Subsection (e) of section 170 of the 
     Internal Revenue Code of 1986 is amended by adding at the end 
     the following new paragraph:
       ``(8) Special rule for contributions of wild game meat.--
       ``(A) In general.--In the case of a charitable contribution 
     by an individual of qualified wild game meat, the amount of 
     such contribution otherwise taken into account under this 
     section (after the application of paragraph (1)(A)) shall be 
     increased by the amount of the qualified processing fees paid 
     with respect to such contribution.
       ``(B) Qualified wild game meat.--For purposes of this 
     paragraph, the term `qualified wild game meat' means the meat 
     of any animal which is typically used for human consumption, 
     but only if--
       ``(i) such animal is killed in the wild by the individual 
     making the charitable contribution of such meat (not 
     including animals raised on a farm for the purpose of sport 
     hunting),
       ``(ii) such animal is hunted or taken in accordance with 
     all State and local laws and

[[Page 10133]]

     regulations, including season and size restrictions,
       ``(iii) such meat is processed for human consumption by a 
     processor which is licensed for such purpose under the 
     appropriate Federal, State, and local laws and regulations 
     and which is in compliance with all such laws and 
     regulations, and
       ``(iv) such meat is apparently wholesome (under regulations 
     similar to the regulations under section 22(b)(2) of the Bill 
     Emerson Good Samaritan Food Donation Act).
       ``(C) Qualified processing fee.--For purposes of this 
     paragraph, the term `qualified processing fee' means any fee 
     or charge paid to a processor which fulfills the requirements 
     of subparagraph (B)(iii) for the purpose of processing wild 
     game meat, but only to the extent that such meat is donated 
     as a charitable contribution under this section.''.
       (b) Exclusion of Processor's Income From Tax Exempt 
     Organizations.--
       (1) In general.--Part III of subchapter B of chapter 1 of 
     the Internal Revenue Code of 1986 is amended by inserting 
     before section 140 the following new section:

     ``SEC. 139F. CERTAIN INCOME RECEIVED FROM CHARITABLE 
                   ORGANIZATIONS.

       ``(a) In General.--Gross income of a qualified meat 
     processor shall not include any amount paid to such processor 
     as a qualified processing fee by a charitable organization 
     for the processing of donated wild game meat.
       ``(b) Definitions.--For purposes of this section--
       ``(1) Qualified meat processor.--The term `qualified meat 
     processor' means a processor which fulfills the requirements 
     of section 170(e)(8)(B)(iii).
       ``(2) Charitable organization.--The term `charitable 
     organization' means an entity to which a charitable 
     contribution may be made under section 170(c) and the 
     charitable purpose of which is to provide free food to 
     individuals in need of food assistance.
       ``(3) Donated wild game meat.--The term `donated wild game 
     meat' means qualified wild game meat (as defined in section 
     170(e)(8)(B), without regard to clause (iii) thereof) which 
     is received as a charitable contribution (as defined in 
     section 170(c)) by a charitable organization.
       ``(4) Qualified processing fee.--The term `qualified 
     processing fee' means any fee or charge paid to a qualified 
     meat processor for the purpose of processing donated wild 
     game meat.''.
       (2) Clerical amendment.--The table of sections for part III 
     of subchapter B of chapter 1 of the Internal Revenue Code of 
     1986 is amended by inserting before the item relating to 
     section 140 the following new item:

``Sec. 139F. Certain income received from tax exempt organizations.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to donations made, and fees received, after the 
     date of the enactment of this Act.
                                 ______
                                 
  SA 4310. Mr. SCHUMER (for himself, Ms. Stabenow, Mr. Levin, Mr. 
Isakson, and Mr. Chambliss) submitted an amendment intended to be 
proposed to amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 
4213, to amend the Internal Revenue Code of 1986 to extend certain 
expiring provisions, and for other purposes; which was ordered to lie 
on the table; as follows:

       At the end of title VI, insert the following:

     SEC. 6__. MODIFICATION OF EXCISE TAX ON INVESTMENT INCOME OF 
                   PRIVATE FOUNDATIONS.

       (a) In General.--Subsection (a) of section 4940 of the 
     Internal Revenue Code of 1986 is amended by inserting ``(1.39 
     percent in the case of taxable years beginning before January 
     1, 2015)'' after ``2 percent''.
       (b) Temporary Elimination of Reduced Tax Where Foundation 
     Meets Certain Distribution Requirements.--Subsection (e) of 
     section 4940 of such Code is amended by adding at the end the 
     following new paragraph:
       ``(7) Application.--Paragraph (1) shall not apply for any 
     taxable year beginning after December 31, 2009, and before 
     January 1, 2015.''.
       (c) Study.--Not later than December 31, 2013, the Secretary 
     of the Treasury shall conduct and submit to the Congress a 
     study which examines the effect of the change in the rate of 
     tax under section 4940 of the Internal Revenue Code of 1986 
     (as amended by this section) has on the level of grantmaking 
     by private foundations.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2009.
                                 ______
                                 
  SA 4311. Mr. FRANKEN (for himself, Ms. Snowe, and Mrs. Murray) 
proposed an amendment to amendment SA 4301 proposed by Mr. Baucus to 
the bill H.R. 4213, to amend the Internal Revenue Code of 1986 to 
extend certain expiring provisions, and for other purposes; as follows:

       At the appropriate place, insert the following:

               TITLE __--OFFICE OF THE HOMEOWNER ADVOCATE

     SEC. _01. OFFICE OF THE HOMEOWNER ADVOCATE.

       (a) Establishment.--There is established in the Department 
     of the Treasury an office to be known as the ``Office of the 
     Homeowner Advocate'' (in this title referred to as the 
     ``Office'').
       (b) Director.--
       (1) In general.--The Director of the Office of the 
     Homeowner Advocate (in this title referred to as the 
     ``Director'') shall report directly to the Assistant 
     Secretary of the Treasury for Financial Stability, and shall 
     be entitled to compensation at the same rate as the highest 
     rate of basic pay established for the Senior Executive 
     Service under section 5382 of title 5, United States Code.
       (2) Appointment.--The Director shall be appointed by the 
     Secretary, after consultation with the Secretary of the 
     Department of Housing and Urban Development, and without 
     regard to the provisions of title 5, United States Code, 
     relating to appointments in the competitive service or the 
     Senior Executive Service.
       (3) Qualifications.--An individual appointed under 
     paragraph (2) shall have--
       (A) experience as an advocate for homeowners; and
       (B) experience dealing with mortgage servicers.
       (4) Restriction on employment.--An individual may be 
     appointed as Director only if such individual was not an 
     officer or employee of either a mortgage servicer or the 
     Department of the Treasury during the 4-year period preceding 
     the date of such appointment.
       (5) Hiring authority.--The Director shall have the 
     authority to hire staff, obtain support by contract, and 
     manage the budget of the Office of the Homeowner Advocate.

     SEC. _02. FUNCTIONS OF THE OFFICE.

       (a) In General.--It shall be the function of the Office--
       (1) to assist homeowners, housing counselors, and housing 
     lawyers in resolving problems with the Home Affordable 
     Modification Program of the Making Home Affordable initiative 
     of the Secretary, authorized under the Emergency Economic 
     Stabilization Act of 2008 (in this title referred to as the 
     ``Home Affordable Modification Program'')
       (2) to identify areas, both individual and systematic, in 
     which homeowners, housing counselors, and housing lawyers 
     have problems in dealings with the Home Affordable 
     Modification Program;
       (3) to the extent possible, to propose changes in the 
     administrative practices of the Home Affordable Modification 
     Program, to mitigate problems identified under paragraph (2);
       (4) to identify potential legislative changes which may be 
     appropriate to mitigate such problems; and
       (5) to implement other programs and initiatives that the 
     Director deems important to assisting homeowners, housing 
     counselors, and housing lawyers in resolving problems with 
     the Home Affordable Modification Program, which may include--
       (A) running a triage hotline for homeowners at risk of 
     foreclosure;
       (B) providing homeowners with access to housing counseling 
     programs of the Department of Housing and Urban Development 
     at no cost to the homeowner;
       (C) developing Internet tools related to the Home 
     Affordable Modification Program; and
       (D) developing training and educational materials.
       (b) Authority.--
       (1) In general.--Staff designated by the Director shall 
     have the authority to implement servicer remedies, on a case-
     by-case basis, subject to the approval of the Assistant 
     Secretary of the Treasury for Financial Stability.
       (2) Limitations on foreclosures.--No homeowner may be taken 
     to a foreclosure sale, until the earlier of the date on which 
     the Office of the Homeowner Advocate case involving the 
     homeowner is closed, or 60 days since the opening of the 
     Office of the Homeowner Advocate case involving the homeowner 
     have passed, except that nothing in this section may be 
     construed to relieve any loan servicers from any otherwise 
     applicable rules, directives, or similar guidance under the 
     Home Affordable Modification Program relating to the 
     continuation or completion of foreclosure proceedings.
       (3) Resolution of homeowner concerns.--The Office shall, to 
     the extent possible, resolve all homeowner concerns not later 
     than 30 days after the opening of a case with such homeowner.
       (c) Commencement of Operations.--The Office shall commence 
     its operations, as required by this title, not later than 3 
     months after the date of enactment of this Act.
       (d) Sunset.--The Office shall cease operations as of the 
     date on which the Home Affordable Modification Program ceases 
     to operate.

     SEC. _03. RELATIONSHIP WITH EXISTING ENTITIES.

       (a) Transfer.--The Office shall coordinate and centralize 
     all complaint escalations relating to the Home Affordable 
     Modification Program.
       (b) Hotline.--The HOPE hotline (or any successor triage 
     hotline) shall reroute all complaints relating to the Home 
     Affordable Modification Program to the Office.

[[Page 10134]]

       (c) Coordination.--The Office shall coordinate with the 
     compliance office of the Office of Financial Stability of the 
     Department of the Treasury and the Homeownership Preservation 
     Office of the Department of the Treasury.

     SEC. _04. REPORTS TO CONGRESS.

       (a) Testimony.--The Director shall be available to testify 
     before the Committee on Banking, Housing, and Urban Affairs 
     of the Senate and the Committee on Financial Services of the 
     House of Representatives, not less frequently than 4 times a 
     year, or at any time at the request of the Chairs of either 
     committee.
       (b) Reports.--Once annually, the Director shall provide a 
     detailed report to Congress on the Home Affordable 
     Modification Program. Such report shall contain full and 
     substantive analysis, in addition to statistical information, 
     including, at a minimum--
       (1) data and analysis of the types and volume of complaints 
     received from homeowners, housing counselors, and housing 
     lawyers, broken down by category of servicer, except that 
     servicers may not be identified by name in the report;
       (2) a summary of not fewer than 20 of the most serious 
     problems encountered by Home Affordable Modification Program 
     participants, including a description of the nature of such 
     problems;
       (3) to the extent known, identification of the 10 most 
     litigated issues for Home Affordable Modification Program 
     participants, including recommendations for mitigating such 
     disputes;
       (4) data and analysis on the resolutions of the complaints 
     received from homeowners, housing counselors, and housing 
     lawyers;
       (5) identification of any programs or initiatives that the 
     Office has taken to improve the Home Affordable Modification 
     Program;
       (6) recommendations for such administrative and legislative 
     action as may be appropriate to resolve problems encountered 
     by Home Affordable Modification Program participants; and
       (7) such other information as the Director may deem 
     advisable.

     SEC. _05. FUNDING.

       Amounts made available for the costs of administration of 
     the Home Affordable Modification Program that are not 
     otherwise obligated shall be available to carry out the 
     duties of the Office. Funding shall be maintained at levels 
     adequate to reasonably carry out the functions of the Office.
                                 ______
                                 
  SA 4312. Mr. VITTER (for himself, Mr. Gregg, and Mr. Cornyn) 
submitted an amendment intended to be proposed to amendment SA 4301 
proposed by Mr. Baucus to the bill H.R. 4213, to amend the Internal 
Revenue Code of 1986 to extend certain expiring provisions, and for 
other purposes; which was ordered to lie on the table; as follows:

       At the end of the subtitle D of title IV, add the 
     following:

     SEC. ___. NEW REVENUES TO THE OIL SPILL LIABILITY TRUST FUND.

       The revenue resulting from any increase in the Oil Spill 
     Liability Trust Fund financing rate under section 4611 of the 
     Internal Revenue Code of 1986 shall--
       (1) not be counted for purposes of offsetting revenues, 
     receipts, or discretionary spending under the Congressional 
     Budget Act of 1974 or the Statutory Pay-As-You-Go Act of 
     2010; and
       (2) shall only be used for the purposes of the Oil Spill 
     Liability Trust Fund.
                                 ______
                                 
  SA 4313. Mr. BARRASSO submitted an amendment intended to be proposed 
by him to the bill H.R. 4213, to amend the Internal Revenue Code of 
1986 to extend certain expiring provisions, and for other purposes; 
which was ordered to lie on the table; as follows:

       At the appropriate place, add the following:
       (h) Attorneys' Fees and Incentive Awards.--
       (1) In general.--Any award of attorneys' fees, expenses, 
     and costs or any incentive award in connection with the 
     Litigation shall be within the discretion of the United 
     States District Court for the District of Columbia (referred 
     to in this section as the ``Court'') and in accordance with 
     controlling law, including paragraphs (2) and (3).
       (2) Attorneys' fees, expenses, and costs.--
       (A) In general.--Any motion or request for attorneys' fees, 
     expenses, and costs incurred in the Litigation shall be 
     supported by complete and contemporaneous daily time, 
     expense, and cost records for all such fees, expenses, and 
     costs.
       (B) Pre-settlement.--Notwithstanding any other provision of 
     law, any award of attorneys' fees, expenses, and costs 
     incurred in the Litigation on or before December 7, 2009, 
     shall not exceed $50,000,000 above amounts previously paid by 
     the defendants in the Litigation.
       (3) Incentive awards.--Notwithstanding any other provision 
     of law, any incentive awards to class representatives in 
     connection with the Litigation--
       (A) shall not exceed, in the aggregate, $15,000,000; and
       (B) shall be limited to reimbursement of documented 
     expenses and costs that--
       (i)(I) were paid by the class representative with the funds 
     of that class representative; or
       (II) were paid by the class representative with borrowed 
     funds that the class representative has a binding legal 
     obligation to repay; and
       (ii) have not otherwise been paid or reimbursed by the 
     United States, Class Counsel, or any other person or entity 
     other than the class representative petitioning for the 
     award.
       (i) Selection of 1 or More Qualifying Banks.--The Court, in 
     exercising the discretion of the Court to approve the 
     selection of any proposed Qualifying Bank under paragraph 
     A.1. of the Settlement, shall consider, in addition to the 
     requirements of paragraph A.29. of the Settlement and any 
     other requirements or factors that the Court determines to be 
     relevant, whether the bank--
       (1) employs officers and staff with experience in 
     administering and collateralizing large deposits of 
     settlement funds;
       (2) has a demonstrated record of compliance with all 
     applicable banking laws (including regulations); and
       (3) offers competitive rates of interest on deposits and 
     competitive fees or charges for any services that the bank 
     will perform under the Settlement.
       (j) Trust Land Consolidation Fund.--
       (1) Consultation.--In implementing paragraph F. of the 
     Settlement, the Secretary shall consult with federally 
     recognized Indian tribes with respect to--
       (A) prioritizing and selecting tracts of land for 
     consolidation of fractionated interests; and
       (B) otherwise implementing the Settlement with regard to 
     consolidation of fractionated interests under the Settlement.
       (2) Contracting and compacting.--Notwithstanding any 
     provision of the Indian Land Consolidation Act (25 U.S.C. 
     2201 et seq.), the activities in implementing paragraph F. of 
     the Settlement shall be subject to contracting and compacting 
     under titles I and IV of the Indian Self-Determination and 
     Education Assistance Act (25 U.S.C. 450 et seq.).
       (k) Trust Administration Class Adjustments.--
       (1) In general.--In addition to any amounts deducted from 
     the Accounting/Trust Administration Fund under paragraph 
     E.4.b.2. of the settlement, the Court shall require the 
     Claims Administrator (as defined in paragraph A.5. of the 
     Settlement) to set aside, from the funds paid into the 
     Accounting/Trust Administration Fund (as defined in paragraph 
     A.1 of the Settlement) pursuant to paragraph E.2.a. of the 
     Settlement, $50,000,000 for making equitable adjustments to 
     the payments to members of the Trust Administration Class 
     pursuant to this subsection.
       (2) Purpose of adjustments.--The purpose of the adjustments 
     under this subsection is to provide additional compensation 
     to any member of the Trust Administration Class who 
     demonstrates that the pro rata formula calculated under 
     paragraph E.4.b.(3) of the Settlement does not provide fair 
     compensation.
       (3) Procedures.--Except as provided in paragraph (5), the 
     procedures, sufficiency of proof, and other requirements for 
     members of the Trust Administration Class to receive 
     adjustments under this subsection shall be established by, 
     and be within the discretion of, the Court.
       (4) Amount of adjustments.--Whether an adjustment 
     authorized under this subsection should be made and the 
     amount of any such adjustment shall be within the discretion 
     of the Court and not subject to appeal.
       (5) Timing of adjustments.--Any adjustment payments 
     authorized under this subsection shall be distributed after 
     payments have been made to class members under paragraphs 
     E.3. and 4. of the Settlement.
       (6) Remaining funds.--Any funds remaining in the amount set 
     aside under paragraph (1) after completing the payments of 
     equitable adjustments under this subsection shall be 
     distributed to all members of the Trust Administration Class 
     in accordance with the pro rata percentages calculated for 
     the members of that class under paragraph E.4.b.(3) of the 
     Settlement.
       (7) Special master.--
       (A) In general.--At the discretion of the Court, the 
     determination of the amount of equitable adjustments under 
     this subsection may be made by the special master appointed 
     under the Settlement.
       (B) Review and approval.--Any adjustments made by the 
     special master under subparagraph (A) shall be subject to the 
     review of the Court.
                                 ______
                                 
  SA 4314. Mr. INHOFE submitted an amendment intended to be proposed by 
him to the bill H.R. 4213, to amend the Internal Revenue Code of 1986 
to extend certain expiring provisions, and for other purposes; which 
was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

[[Page 10135]]



            TITLE __--HONEST EXPENDITURE LIMITATION PROGRAM

     SEC. _01. SHORT TITLE; EXPIRATION.

       (a) Short Title.--This title may be cited as the ``Honest 
     Expenditure Limitation Program Act of 2010'' or the ``HELP 
     Act''.
       (b) Expiration.--This title shall expire at the end of 
     fiscal year 2020.

  Subtitle A--Congressional Non-security Discretionary Spending Limits

     SEC. _101. NON-SECURITY DISCRETIONARY SPENDING LIMITS.

       (a) In General.--Title III of the Congressional Budget Act 
     of 1974 is amended by inserting at the end the following:


              ``non-security discretionary spending limits

       ``Sec. 316.  (a) Non-security Discretionary Spending 
     Limits.--It shall not be in order in the House of 
     Representatives or the Senate to consider any bill, joint 
     resolution, amendment, or conference report that includes any 
     provision that would cause the non-security discretionary 
     spending limits as set forth in subsection (b) to be 
     exceeded.
       ``(b) Limits.--The non-security discretionary spending 
     limits are as follows:
       ``(1) For fiscal years 2011 through 2015, the spending 
     level for such spending in fiscal year 2010 reduced each year 
     thereafter on a pro rata basis so that the level for fiscal 
     year 2015 does not exceed the level for fiscal year 2008.
       ``(2) For fiscal years 2016 through 2020, the spending 
     level for fiscal year 2015.
       ``(c) Non-security Spending.--In this section, the term 
     `non-security discretionary spending' means discretionary 
     spending other than spending for the Department of Defense, 
     homeland security activities, intelligence related activities 
     within the Department of State, the Department of Veterans 
     Affairs, and national security related activities in the 
     Department of Energy.
       ``(d) Limitations on Changes to This Section.--It shall not 
     be in order in the Senate or the House of Representatives to 
     consider any bill, resolution, amendment, or conference 
     report that would--
       ``(1) repeal or otherwise change this section; or
       ``(2) exempt any new budget authority, outlays, and 
     receipts from being counted for purposes of this section.
       ``(e) Point of Order in the Senate.--
       ``(1) Waiver.--The provisions of this section shall be 
     waived or suspended in the Senate only--
       ``(A) by the affirmative vote of two-thirds of the Members, 
     duly chosen and sworn; or
       ``(B) in the case of the defense budget authority, if 
     Congress declares war or authorizes the use of force.
       ``(2) Appeal.--Appeals in the Senate from the decisions of 
     the Chair relating to any provision of this section shall be 
     limited to 1 hour, to be equally divided between, and 
     controlled by, the appellant and the manager of the measure. 
     An affirmative vote of two-thirds of the Members of the 
     Senate, duly chosen and sworn, shall be required to sustain 
     an appeal of the ruling of the Chair on a point of order 
     raised under this section.''.
       (b) Table of Contents.--The table of contents set forth in 
     section 1(b) of the Congressional Budget and Impoundment 
     Control Act of 1974 is amended by inserting after the item 
     relating to section 315 the following new item:

``Sec. 316. Non-security discretionary spending limits.''.

    Subtitle B--Statutory Non-security Discretionary Spending Limits

         PART I--DEFINITIONS, ADMINISTRATION, AND SEQUESTRATION

     SEC. _211. DEFINITIONS.

       In this title:
       (1) Account.--The term ``account'' means--
       (A) for discretionary budget authority, an item for which 
     appropriations are made in any appropriation Act; and
       (B) for items not provided for in appropriation Acts, 
     direct spending and outlays therefrom identified in the 
     program and finance schedules contained in the appendix to 
     the Budget of the United States for the current year.
       (2) Breach.--The term ``breach'' means, for any fiscal 
     year, the amount by which discretionary budget authority 
     enacted for that year exceeds the spending limit for budget 
     authority for that year.
       (3) Budget authority; new budget authority; and outlays.--
     The terms ``budget authority'', ``new budget authority'', and 
     ``outlays'' have the meanings given to such terms in section 
     3 of the Congressional Budget and Impoundment Control Act of 
     1974 (2 U.S.C. 622).
       (4) Budget year.--The term ``budget year'' means, with 
     respect to a session of Congress, the fiscal year of the 
     Government that starts on October 1 of the calendar year in 
     which that session begins.
       (5) CBO.--The term ``CBO'' means the Director of the 
     Congressional Budget Office.
       (6) Current.--The term ``current'' means--
       (A) with respect to the Office of Management and Budget 
     estimates included with a budget submission under section 
     1105(a) of title 31, United States Code, the estimates 
     consistent with the economic and technical assumptions 
     underlying that budget;
       (B) with respect to estimates made after that budget 
     submission that are not included with it, the estimates 
     consistent with the economic and technical assumptions 
     underlying the most recently submitted President's budget; 
     and
       (C) with respect to the Congressional Budget Office, 
     estimates consistent with the economic and technical 
     assumptions as required by section 202(e)(1) of the 
     Congressional Budget Act of 1974.
       (7) Current year.--The term ``current year'' means, with 
     respect to a budget year, the fiscal year that immediately 
     precedes that budget year.
       (8) Discretionary appropriations and discretionary budget 
     authority.--The terms ``discretionary appropriations'' and 
     ``discretionary budget authority'' shall have the meaning 
     given such terms in section 3(4) of the Congressional Budget 
     Act of 1974.
       (9) Non-security discretionary spending limit.--The term 
     ``non-security discretionary spending limit'' shall mean the 
     amounts specified in section 222.
       (10) OMB.--The term ``OMB'' means the Director of the 
     Office of Management and Budget.
       (11) Sequestration.--The term ``sequestration'' means the 
     cancellation or reduction of budget authority (except budget 
     authority to fund mandatory programs) provided in 
     appropriation Acts.

     SEC. _212. ADMINISTRATION AND EFFECT OF SEQUESTRATION.

       (a) Timetable.--The timetable with respect to this title is 
     as follows:


On or before:                                         Action to be completed:
5 days before the President's budget submission       CBO Discretionary Sequestration Preview Report.
 required under section 1105 of title 31, United
 States Code.
The President's budget submission...................  OMB Discretionary Sequestration Preview Report.
10 days after end of session........................  CBO Final Discretionary Sequestration Report.
15 days after end of session........................  OMB Final Discretionary Sequestration/Presidential
                                                       Sequestration Order.
 

       (b) Presidential Order.--
       (1) In general.--On the date specified in subsection (a), 
     if in its Final Sequestration Report, OMB estimates that any 
     sequestration is required, the President shall issue an order 
     fully implementing without change all sequestrations required 
     by the OMB calculations set forth in that report. This order 
     shall be effective on issuance.
       (2) Special rule.--If the date specified for the submission 
     of a Presidential order under subsection (a) falls on a 
     Sunday or legal holiday, such order shall be issued on the 
     following day.
       (c) Effects of Sequestration.--The effects of sequestration 
     shall be as follows:
       (1) Budgetary resources sequestered from any account shall 
     be permanently cancelled, except as provided in paragraph 
     (5).
       (2) Except as otherwise provided, the same percentage 
     sequestration shall apply to all programs, projects, and 
     activities within a budget account (with programs, projects, 
     and activities as delineated in the appropriation Act or 
     accompanying report for the relevant fiscal year covering 
     that account).
       (3) Administrative regulations or similar actions 
     implementing a sequestration shall be made within 120 days of 
     the sequestration order. To the extent that formula 
     allocations differ at different levels of budgetary resources 
     within an account, program, project, or activity, the 
     sequestration shall be interpreted as producing a lower total 
     appropriation, with the remaining amount of the appropriation 
     being obligated in a manner consistent with program 
     allocation formulas in substantive law.
       (4) Except as otherwise provided in this part, obligations 
     or budgetary resources in sequestered accounts shall be 
     reduced only in the fiscal year in which a sequester occurs.
       (5) Budgetary resources sequestered in special fund 
     accounts and offsetting collections sequestered in 
     appropriation accounts shall not be available for obligation 
     during the fiscal year in which the sequestration occurs, but 
     shall be available in subsequent years to the extent 
     otherwise provided in law.
       (d) Submission and Availability of Reports.--Each report 
     required by this section shall be submitted, in the case of 
     CBO, to the House of Representatives, the Senate, and OMB 
     and, in the case of OMB, to the House of Representatives, the 
     Senate, and the President on the day it is issued. On the 
     following day a notice of the report shall be printed in the 
     Federal Register.

          PART II--NON-SECURITY DISCRETIONARY SPENDING LIMITS

     SEC. _221. DISCRETIONARY SEQUESTRATION REPORTS.

       (a) Discretionary Sequestration Preview Reports.--
       (1) Reporting requirement.--On the dates specified in 
     section 212(a), OMB shall report

[[Page 10136]]

     to the President and Congress and CBO shall report to 
     Congress a Discretionary Sequestration Preview Report 
     regarding discretionary sequestration based on laws enacted 
     through those dates.
       (2) Discretionary.--The Discretionary Sequestration Preview 
     Report shall set forth estimates for the current year and 
     each subsequent year through 2014 of the applicable 
     discretionary spending limits and a projection of budget 
     authority exceeding discretionary limits subject to 
     sequester.
       (3) Explanation of differences.--The OMB reports shall 
     explain the differences between OMB and CBO estimates for 
     each item set forth in this subsection.
       (b) Discretionary Sequestration Reports.--On the dates 
     specified in section 212(a), OMB and CBO shall issue 
     Discretionary Sequestration Reports, reflecting laws enacted 
     through those dates, containing all of the information 
     required in the Discretionary Sequestration Preview Reports.
       (c) Final Discretionary Sequestration Reports.--
       (1) Reporting requirements.--On the dates specified in 
     section 212(a), OMB and CBO shall each issue a Final 
     Discretionary Sequestration Report, updated to reflect laws 
     enacted through those dates.
       (2) Discretionary spending.--The Final Discretionary 
     Sequestration Reports shall set forth estimates for each of 
     the following:
       (A) For the current year and each subsequent year through 
     2014; the applicable discretionary spending limits.
       (B) For the current year, if applicable, and the budget 
     year; the new budget authority and the breach, if any.
       (C) The sequestration percentages necessary to eliminate 
     the breach.
       (D) For the budget year, for each account to be 
     sequestered, the level of enacted, sequesterable budget 
     authority and resulting estimated outlays flowing therefrom.
       (3) Explanation of differences.--The OMB report shall 
     explain--
       (A) any differences between OMB and CBO estimates for the 
     amount of any breach and for any required discretionary 
     sequestration percentages; and
       (B) differences in the amount of sequesterable resources 
     for any budget account to be reduced if such difference is 
     greater than $5,000,000.
       (d) Economic and Technical Assumptions.--In all reports 
     required by this section, OMB shall use the same economic and 
     technical assumptions as used in the most recent budget 
     submitted by the President under section 1105(a) of title 31, 
     United States Code.

     SEC. _222. LIMITS.

       (a) Discretionary Spending Limits.--As used in this title, 
     the term ``non-security discretionary spending limit'' shall 
     have the same meaning as in section 316 of the Congressional 
     Budget Act of 1974.
       (b) Enforcement.--
       (1) Sequestration.--On the date specified in section 
     212(a), there shall be a sequestration to eliminate a budget-
     year breach.
       (2) Eliminating a breach.--Each non-security discretionary 
     account shall be reduced by a dollar amount calculated by 
     multiplying the enacted level of budget authority for that 
     year in that account at that time by the uniform percentage 
     necessary to eliminate a breach of the discretionary spending 
     limit.
       (3) Part-year appropriations.--If, on the date the report 
     is issued under paragraph (1), there is in effect an Act 
     making continuing appropriations for part of a fiscal year 
     for any budget account, then the dollar sequestration 
     calculated for that account under paragraph (2) shall be 
     subtracted from--
       (A) the annualized amount otherwise available by law in 
     that account under that or a subsequent part-year 
     appropriation; and
       (B) when a full-year appropriation for that account is 
     enacted, from the amount otherwise provided by the full-year 
     appropriation.
       (4) Look-back.--If, after June 30, an appropriation for the 
     fiscal year in progress is enacted that causes a breach for 
     that year (after taking into account any previous 
     sequestration), the discretionary spending limit for the next 
     fiscal year shall be reduced by the amount of that breach.
       (5) Within-session sequestration reports and order.--If an 
     appropriation for a fiscal year in progress is enacted (after 
     Congress adjourns to end the session for that budget year and 
     before July 1 of that fiscal year) that causes a breach, 10 
     days later CBO shall issue a report containing the 
     information required in section 221(c). Fifteen days after 
     enactment, OMB shall issue a report containing the 
     information required in section 221(c). On the same day as 
     the OMB report, the President shall issue an order fully 
     implementing without change all sequestrations required by 
     the OMB calculations set forth in that report. This order 
     shall be effective on issuance.
       (c) Estimates.--
       (1) CBO estimates.--As soon as practicable after Congress 
     completes action on any legislation providing discretionary 
     appropriations, CBO shall provide an estimate to OMB of that 
     legislation.
       (2) OMB estimates.--Not later than 7 calendar days 
     (excluding Saturdays, Sundays, and legal holidays) after the 
     date of enactment of any discretionary appropriations, OMB 
     shall transmit a report to the Senate and to the House of 
     Representatives containing--
       (A) the CBO estimate of that legislation;
       (B) an OMB estimate of that legislation using current 
     economic and technical assumptions; and
       (C) an explanation of any difference between the 2 
     estimates.
       (3) Differences.--If during the preparation of the report 
     under paragraph (2), OMB determines that there is a 
     difference between the OMB and CBO estimates, OMB shall 
     consult with the Committees on the Budget of the House of 
     Representatives and the Senate regarding that difference and 
     that consultation, to the extent practicable, shall include 
     written communication to such committees that affords such 
     committees the opportunity to comment before the issuance of 
     that report.
       (4) Assumptions and guidelines.--OMB and CBO shall prepare 
     estimates under this paragraph in conformance with 
     scorekeeping guidelines determined after consultation among 
     the House and Senate Committees on the Budget, CBO, and OMB.
                                 ______
                                 
  SA 4315. Mr. SESSIONS (for himself and Mrs. McCaskill) submitted an 
amendment intended to be proposed by him to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       At the end of the amendment, insert the following:

     SEC. ___. DISCRETIONARY SPENDING LIMITS.

       (a) Point of Order.--It shall not be in order in the House 
     of Representatives or the Senate to consider any bill, joint 
     resolution, amendment, or conference report that includes any 
     provision that would cause the discretionary spending limits 
     as set forth in this section to be exceeded.
       (b) Limits.--In this section, the term ``discretionary 
     spending limits'' has the following meaning subject to 
     adjustments in subsection (c):
       (1) For fiscal year 2011--
       (A) for the defense category (budget function 050), 
     $564,293,000,000 in budget authority; and
       (B) for the nondefense category, $540,116,000,000 in budget 
     authority.
       (2) For fiscal year 2012--
       (A) for the defense category (budget function 050), 
     $573,612,000,000 in budget authority; and
       (B) for the nondefense category, $543,790,000,000 in budget 
     authority.
       (3) For fiscal year 2013--
       (A) for the defense category (budget function 050), 
     $584,421,000,000 in budget authority; and
       (B) for the nondefense category, $551,498,000,000 in budget 
     authority.
       (4) With respect to fiscal years following 2013, the 
     President shall recommend and the Congress shall consider 
     legislation setting limits for those fiscal years.
       (c) Adjustments.--
       (1) In general.--After the reporting of a bill or joint 
     resolution relating to any matter described in paragraph (2), 
     or the offering of an amendment thereto or the submission of 
     a conference report thereon--
       (A) the Chairman of the Senate Committee on the Budget may 
     adjust the discretionary spending limits, the budgetary 
     aggregates in the concurrent resolution on the budget most 
     recently adopted by the Senate and the House of 
     Representatives, and allocations pursuant to section 302(a) 
     of the Congressional Budget Act of 1974, by the amount of new 
     budget authority in that measure for that purpose and the 
     outlays flowing there from; and
       (B) following any adjustment under subparagraph (A), the 
     Senate Committee on Appropriations may report appropriately 
     revised suballocations pursuant to section 302(b) of the 
     Congressional Budget Act of 1974 to carry out this 
     subsection.
       (2) Matters described.--Matters referred to in paragraph 
     (1) are as follows:
       (A) Overseas deployments and other activities.--If a bill 
     or joint resolution is reported making appropriations for 
     fiscal year 2011, 2012, or 2013, that provides funding for 
     overseas deployments and other activities, the adjustment for 
     purposes paragraph (1) shall be the amount of budget 
     authority in that measure for that purpose but not to 
     exceed--
       (i) with respect to fiscal year 2011, $50,000,000,000 in 
     new budget authority;
       (ii) with respect to fiscal year 2012, $50,000,000,000 in 
     new budget authority; and
       (iii) with respect to fiscal year 2013, $50,000,000,000 in 
     new budget authority.
       (B) Internal revenue service tax enforcement.--
       (i) In general.--If a bill or joint resolution is reported 
     making appropriations for fiscal year 2011, 2012, or 2013, 
     that includes the amount described in clause (ii)(I), plus an 
     additional amount for enhanced tax enforcement to address the 
     Federal tax gap (taxes owed but not paid) described in clause 
     (ii)(II), the adjustment for purposes of paragraph (1) shall 
     be the amount of budget authority in that measure for that 
     initiative not exceeding the amount specified in clause 
     (ii)(II) for that fiscal year.

[[Page 10137]]

       (ii) Amounts.--The amounts referred to in clause (i) are as 
     follows:

       (I) For fiscal year 2011, $7,171,000,000, for fiscal year 
     2012, $7,243,000,000, and for fiscal year 2013, 
     $7,315,000,000.
       (II) For fiscal year 2011, $899,000,000, for fiscal year 
     2012, and $908,000,000, for fiscal year 2013, $917,000,000.

       (C) Continuing disability reviews and ssi 
     redeterminations.--
       (i) In general.--If a bill or joint resolution is reported 
     making appropriations for fiscal year 2011, 2012, or 2013 
     that includes the amount described in clause (ii)(I), plus an 
     additional amount for Continuing Disability Reviews and 
     Supplemental Security Income Redeterminations for the Social 
     Security Administration described in clause (ii)(II), the 
     adjustment for purposes of paragraph (1) shall be the amount 
     of budget authority in that measure for that initiative not 
     exceeding the amount specified in clause (ii)(II) for that 
     fiscal year.
       (ii) Amounts.--The amounts referred to in clause (i) are as 
     follows:

       (I) For fiscal year 2011, $276,000,000, for fiscal year 
     2012, $278,000,000, and for fiscal year 2013, $281,000,000.
       (II) For fiscal year 2011, $490,000,000; for fiscal year 
     2012, and $495,000,000; for fiscal year 2013, $500,000,000.

       (iii) Asset verification.--

       (I) In general.--The additional appropriation permitted 
     under clause (ii)(II) may also provide that a portion of that 
     amount, not to exceed the amount specified in subclause (II) 
     for that fiscal year instead may be used for asset 
     verification for Supplemental Security Income recipients, but 
     only if, and to the extent that the Office of the Chief 
     Actuary estimates that the initiative would be at least as 
     cost effective as the redeterminations of eligibility 
     described in this subparagraph.
       (II) Amounts.--For fiscal year 2011, $34,340,000, for 
     fiscal year 2012, $34,683,000, and for fiscal year 2013, 
     $35,030,000.

       (D) Health care fraud and abuse.--
       (i) In general.--If a bill or joint resolution is reported 
     making appropriations for fiscal year 2011, 2012, or 2013 
     that includes the amount described in clause (ii) for the 
     Health Care Fraud and Abuse Control program at the Department 
     of Health & Human Services for that fiscal year, the 
     adjustment for purposes of paragraph (1) shall be the amount 
     of budget authority in that measure for that initiative but 
     not to exceed the amount described in clause (ii).
       (ii) Amount.--The amount referred to in clause (i) is for 
     fiscal year 2011, $314,000,000, for fiscal year 2012, 
     $317,000,000, and for fiscal year 2013, $320,000,000.
       (E) Unemployment insurance improper payment reviews.--If a 
     bill or joint resolution is reported making appropriations 
     for fiscal year 2011, 2012, or 2013 that includes 
     $10,000,000, plus an additional amount for in-person 
     reemployment and eligibility assessments and unemployment 
     improper payment reviews for the Department of Labor, the 
     adjustment for purposes paragraph (1) shall be the amount of 
     budget authority in that measure for that initiative but not 
     to exceed--
       (i) with respect to fiscal year 2011, $51,000,000 in new 
     budget authority;
       (ii) with respect to fiscal year 2012, $51,000,000 in new 
     budget authority; and
       (iii) with respect to fiscal year 2013, $52,000,000 in new 
     budget authority.
       (F) Low-income home energy assistance program (liheap).--If 
     a bill or joint resolution is reported making appropriations 
     for fiscal year 2011, 2012, or 2013 that includes 
     $3,200,000,000 in funding for the Low-Income Home Energy 
     Assistance Program and provides an additional amount up to 
     $1,900,000,000 for that program, the adjustment for purposes 
     of paragraph (1) shall be the amount of budget authority in 
     that measure for that initiative but not to exceed 
     $1,900,000,000.
       (d) Emergency Spending.--
       (1) Authority to designate.--In the Senate, with respect to 
     a provision of direct spending or receipts legislation or 
     appropriations for discretionary accounts that Congress 
     designates as an emergency requirement in such measure, the 
     amounts of new budget authority, outlays, and receipts in all 
     fiscal years resulting from that provision shall be treated 
     as an emergency requirement for the purpose of this 
     subsection.
       (2) Exemption of emergency provisions.--Any new budget 
     authority, outlays, and receipts resulting from any provision 
     designated as an emergency requirement, pursuant to this 
     subsection, in any bill, joint resolution, amendment, or 
     conference report shall not count for purposes of this 
     section, sections 302 and 311 of this Act, section 201 of S. 
     Con. Res. 21 (110th Congress) (relating to pay-as-you-go), 
     section 311 of S. Con. Res. 70 (110th Congress) (relating to 
     long-term deficits), and section 404 of S. Con. Res. 13 
     (111th Congress).
       (3) Designations.--If a provision of legislation is 
     designated as an emergency requirement under this subsection, 
     the committee report and any statement of managers 
     accompanying that legislation shall include an explanation of 
     the manner in which the provision meets the criteria in 
     paragraph (6).
       (4) Definitions.--In this subsection, the terms ``direct 
     spending'', ``receipts'', and ``appropriations for 
     discretionary accounts'' mean any provision of a bill, joint 
     resolution, amendment, motion, or conference report that 
     affects direct spending, receipts, or appropriations as those 
     terms have been defined and interpreted for purposes of the 
     Balanced Budget and Emergency Deficit Control Act of 1985.
       (5) Point of order.--
       (A) In general.--When the Senate is considering a bill, 
     resolution, amendment, motion, or conference report, if a 
     point of order is made by a Senator against an emergency 
     designation in that measure, that provision making such a 
     designation shall be stricken from the measure and may not be 
     offered as an amendment from the floor.
       (B) Supermajority waiver and appeals.--
       (i) Waiver.--Subparagraph (A) may be waived or suspended in 
     the Senate only by an affirmative vote of three-fifths of the 
     Members, duly chosen and sworn.
       (ii) Appeals.--Appeals in the Senate from the decisions of 
     the Chair relating to any provision of this paragraph shall 
     be limited to 1 hour, to be equally divided between, and 
     controlled by, the appellant and the manager of the bill or 
     joint resolution, as the case may be. An affirmative vote of 
     three-fifths of the Members of the Senate, duly chosen and 
     sworn, shall be required to sustain an appeal of the ruling 
     of the Chair on a point of order raised under this paragraph.
       (C) Definition of an emergency designation.--For purposes 
     of subparagraph (A), a provision shall be considered an 
     emergency designation if it designates any item as an 
     emergency requirement pursuant to this paragraph.
       (D) Form of the point of order.--A point of order under 
     subparagraph (A) may be raised by a Senator as provided in 
     section 313(e) of the Congressional Budget Act of 1974.
       (E) Conference reports.--When the Senate is considering a 
     conference report on, or an amendment between the Houses in 
     relation to, a bill, upon a point of order being made by any 
     Senator pursuant to this paragraph, and such point of order 
     being sustained, such material contained in such conference 
     report shall be deemed stricken, and the Senate shall proceed 
     to consider the question of whether the Senate shall recede 
     from its amendment and concur with a further amendment, or 
     concur in the House amendment with a further amendment, as 
     the case may be, which further amendment shall consist of 
     only that portion of the conference report or House 
     amendment, as the case may be, not so stricken. Any such 
     motion in the Senate shall be debatable. In any case in which 
     such point of order is sustained against a conference report 
     (or Senate amendment derived from such conference report by 
     operation of this subsection), no further amendment shall be 
     in order.
       (6) Criteria.--
       (A) In general.--For purposes of this subsection, any 
     provision is an emergency requirement if the situation 
     addressed by such provision is--
       (i) necessary, essential, or vital (not merely useful or 
     beneficial);
       (ii) sudden, quickly coming into being, and not building up 
     over time;
       (iii) an urgent, pressing, and compelling need requiring 
     immediate action;
       (iv) subject to clause (ii), unforeseen, unpredictable, and 
     unanticipated; and
       (v) not permanent, temporary in nature.
       (7) Unforeseen.--An emergency that is part of an aggregate 
     level of anticipated emergencies, particularly when normally 
     estimated in advance, is not unforeseen.
       (e) Limitations on Changes to Exemptions.--It shall not be 
     in order in the Senate or the House of Representatives to 
     consider any bill, resolution, amendment, or conference 
     report that would exempt any new budget authority, outlays, 
     and receipts from being counted for purposes of this section.
       (f) Point of Order in the Senate.--
       (1) Waiver.--The provisions of subsections (a) and (e) of 
     this section shall be waived or suspended in the Senate 
     only--
       (A) by the affirmative vote of two-thirds of the Members, 
     duly chosen and sworn; or
       (B) in the case of the defense budget authority, if 
     Congress declares war or authorizes the use of force.
       (2) Appeal.--Appeals in the Senate from the decisions of 
     the Chair relating to any provision of this section shall be 
     limited to 1 hour, to be equally divided between, and 
     controlled by, the appellant and the manager of the measure. 
     An affirmative vote of two-thirds of the Members of the 
     Senate, duly chosen and sworn, shall be required to sustain 
     an appeal of the ruling of the Chair on a point of order 
     raised under this section.
       (g) Limitations on Changes to this Section.--It shall not 
     be in order in the Senate or the House of Representatives to 
     consider any bill, resolution, amendment, or conference 
     report that would repeal or otherwise change this section.
                                 ______
                                 
  SA 4316. Mr. BINGAMAN submitted an amendment intended to be proposed 
to amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       On page 255, line 18, strike ``a drug'' and insert ``a 
     covered inpatient drug''.

[[Page 10138]]

       On page 256, line 24, strike ``a patient'' and insert ``an 
     inpatient''.
       On page 260, line 17, after ``subsection (a)(4)'' insert 
     the following: ``that has applied for and enrolled in the 
     program described under this section''.
       On page 261, line 15, strike ``20.20'' and insert 
     ``11.75''.
       On page 275, strike line 2 and insert the following: each 
     succeeding fiscal year.
       ``(g) Effect of Section.--Nothing in this section shall be 
     construed to apply to section 340B.''.
                                 ______
                                 
  SA 4317. Mr. BINGAMAN submitted an amendment intended to be proposed 
to amendment SA 4301 proposed by Mr. Baucus to the bill H.R. 4213, to 
amend the Internal Revenue Code of 1986 to extend certain expiring 
provisions, and for other purposes; which was ordered to lie on the 
table; as follows:

       Beginning on page 255, strike line 14 and all that follows 
     through line 2 on page 275 and insert the following:
       ``(i) In general.--A covered entity shall not request 
     payment under title XIX of the Social Security Act for 
     medical assistance described in section 1905(a)(12) of such 
     Act with respect to a covered inpatient drug that is subject 
     to an agreement under this section if the drug is subject to 
     the payment of a rebate to the State under section 1927 of 
     such Act.
       ``(ii) Establishment of mechanism.--The Secretary shall 
     establish a mechanism to ensure that covered entities comply 
     with clause (i). If the Secretary does not establish a 
     mechanism under the previous sentence within 12 months of the 
     enactment of this section, the requirements of section 
     1927(a)(5)(C) of the Social Security Act shall apply.
       ``(iii) Prohibiting disclosure to group purchasing 
     organizations.--In the event that a covered entity is a 
     member of a group purchasing organization, such entity shall 
     not disclose the price or any other information pertaining to 
     any purchases under this section directly or indirectly to 
     such group purchasing organization.
       ``(B) Prohibiting resale, dispensing, or administration of 
     drugs except to certain patients.--With respect to any 
     covered inpatient drug that is subject to an agreement under 
     this subsection, a covered entity shall not dispense, 
     administer, resell, or otherwise transfer the covered 
     inpatient drug to a person unless--
       ``(i) such person is an inpatient of the entity; and
       ``(ii) such person does not have health plan coverage (as 
     defined in subsection (c)(3)) that provides prescription drug 
     coverage in the inpatient setting with respect to such 
     covered inpatient drug.

     For purposes of clause (ii), a person shall be treated as 
     having health plan coverage (as defined in subsection (c)(3)) 
     with respect to a covered inpatient drug if benefits are not 
     payable under such coverage with respect to such drug for 
     reasons such as the application of a deductible or cost 
     sharing or the use of utilization management.
       ``(C) Auditing.--A covered entity shall permit the 
     Secretary and the manufacturer of a covered inpatient drug 
     that is subject to an agreement under this subsection with 
     the entity (acting in accordance with procedures established 
     by the Secretary relating to the number, duration, and scope 
     of audits) to audit at the Secretary's or the manufacturer's 
     expense the records of the entity that directly pertain to 
     the entity's compliance with the requirements described in 
     subparagraph (A) or (B) with respect to drugs of the 
     manufacturer. The use or disclosure of information for 
     performance of such an audit shall be treated as a use or 
     disclosure required by law for purposes of section 164.512(a) 
     of title 45, Code of Federal Regulations.
       ``(D) Additional sanction for noncompliance.--If the 
     Secretary finds, after notice and hearing, that a covered 
     entity is in violation of a requirement described in 
     subparagraph (A) or (B), the covered entity shall be liable 
     to the manufacturer of the covered inpatient drug that is the 
     subject of the violation in an amount equal to the reduction 
     in the price of the drug (as described in subparagraph (A)) 
     provided under the agreement between the Secretary and the 
     manufacturer under this subsection.
       ``(E) Maintenance of records.--
       ``(i) In general.--A covered entity shall establish and 
     maintain an effective recordkeeping system to comply with 
     this section and shall certify to the Secretary that such 
     entity is in compliance with subparagraphs (A) and (B). The 
     Secretary shall require that hospitals that purchase covered 
     inpatient drugs for inpatient dispensing or administration 
     under this subsection appropriately segregate inventory of 
     such covered inpatient drugs, either physically or 
     electronically, from drugs for outpatient use, as well as 
     from drugs for inpatient dispensing or administration to 
     individuals who have (for purposes of subparagraph (B)) 
     health plan coverage described in clause (ii) of such 
     subparagraph.
       ``(ii) Certification of no third-party payer.--A covered 
     entity shall maintain records that contain certification by 
     the covered entity that no third party payment was received 
     for any covered inpatient drug that is subject to an 
     agreement under this subsection and that was dispensed to an 
     inpatient.
       ``(5) Treatment of distinct units of hospitals.--In the 
     case of a covered entity that is a distinct part of a 
     hospital, the distinct part of the hospital shall not be 
     considered a covered entity under this subsection unless the 
     hospital is otherwise a covered entity under this subsection.
       ``(6) Notice to manufacturers.--The Secretary shall notify 
     manufacturers of covered inpatient drugs and single State 
     agencies under section 1902(a)(5) of the Social Security Act 
     of the identities of covered entities under this subsection, 
     and of entities that no longer meet the requirements of 
     paragraph (4), by means of timely updates of the Internet 
     website supported by the Department of Health and Human 
     Services relating to this section.
       ``(7) No prohibition on larger discount.--Nothing in this 
     subsection shall prohibit a manufacturer from charging a 
     price for a drug that is lower than the maximum price that 
     may be charged under paragraph (1).
       ``(b) Covered Entity Defined.--In this section, the term 
     `covered entity' means an entity that meets the requirements 
     described in subsection (a)(4) that has applied for and 
     enrolled in the program described under this section and is 
     one of the following:
       ``(1) A subsection (d) hospital (as defined in section 
     1886(d)(1)(B) of the Social Security Act) that--
       ``(A) is owned or operated by a unit of State or local 
     government, is a public or private non-profit corporation 
     which is formally granted governmental powers by a unit of 
     State or local government, or is a private nonprofit hospital 
     which has a contract with a State or local government to 
     provide health care services to low income individuals who 
     are not entitled to benefits under title XVIII of the Social 
     Security Act or eligible for assistance under the State plan 
     for medical assistance under title XIX of such Act; and
       ``(B) for the most recent cost reporting period that ended 
     before the calendar quarter involved, had a disproportionate 
     share adjustment percentage (as determined using the 
     methodology under section 1886(d)(5)(F) of the Social 
     Security Act as in effect on the date of enactment of this 
     section) greater than 11.75 percent or was described in 
     section 1886(d)(5)(F)(i)(II) of such Act (as so in effect on 
     the date of enactment of this section).
       ``(2) A children's hospital excluded from the Medicare 
     prospective payment system pursuant to section 
     1886(d)(1)(B)(iii) of the Social Security Act that would meet 
     the requirements of paragraph (1), including the 
     disproportionate share adjustment percentage requirement 
     under subparagraph (B) of such paragraph, if the hospital 
     were a subsection (d) hospital as defined by section 
     1886(d)(1)(B) of the Social Security Act.
       ``(3) A free-standing cancer hospital excluded from the 
     Medicare prospective payment system pursuant to section 
     1886(d)(1)(B)(v) of the Social Security Act that would meet 
     the requirements of paragraph (1), including the 
     disproportionate share adjustment percentage requirement 
     under subparagraph (B) of such paragraph, if the hospital 
     were a subsection (d) hospital as defined by section 
     1886(d)(1)(B) of the Social Security Act.
       ``(4) An entity that is a critical access hospital (as 
     determined under section 1820(c)(2) of the Social Security 
     Act), and that meets the requirements of paragraph (1)(A).
       ``(5) An entity that is a rural referral center, as defined 
     by section 1886(d)(5)(C)(i) of the Social Security Act, or a 
     sole community hospital, as defined by section 
     1886(d)(5)(C)(iii) of such Act, and that both meets the 
     requirements of paragraph (1)(A) and has a disproportionate 
     share adjustment percentage equal to or greater than 8 
     percent.
       ``(c) Other Definitions.--In this section:
       ``(1) Average manufacturer price.--
       ``(A) In general.--The term `average manufacturer price'--
       ``(i) has the meaning given such term in section 1927(k) of 
     the Social Security Act, except that such term shall be 
     applied under this section with respect to covered inpatient 
     drugs in the same manner (as applicable) as such term is 
     applied under such section 1927(k) with respect to covered 
     outpatient drugs (as defined in such section); and
       ``(ii) with respect to a covered inpatient drug for which 
     there is no average manufacturer price (as defined in clause 
     (i)), shall be the amount determined under regulations 
     promulgated by the Secretary under subparagraph (B).
       ``(B) Rulemaking.--The Secretary shall by regulation, in 
     consultation with the Administrator of the Centers for 
     Medicare & Medicaid Services, establish a method for 
     determining the average manufacturer price for covered 
     inpatient drugs for which there is no average manufacturer 
     price (as defined in subparagraph (A)(i)). Regulations 
     promulgated with respect to covered inpatient drugs under the 
     preceding sentence shall provide for the application of 
     methods for determining the average manufacturer price that

[[Page 10139]]

     are the same as the methods used to determine such price in 
     calculating rebates required for such drugs under an 
     agreement between a manufacturer and a State that satisfies 
     the requirements of section 1927(b) of the Social Security 
     Act, as applicable.
       ``(2) Covered inpatient drug.--The term `covered inpatient 
     drug' means a drug--
       ``(A) that is described in section 1927(k)(2) of the Social 
     Security Act;
       ``(B) that, notwithstanding paragraph (3)(A) of section 
     1927(k) of such Act, is used in connection with an inpatient 
     service provided by a covered entity that is enrolled to 
     participate in the drug discount program under this section; 
     and
       ``(C) that is not purchased by the covered entity through 
     or under contract with a group purchasing organization.
       ``(3) Health plan coverage.--The term `health plan 
     coverage' means--
       ``(A) health insurance coverage (as defined in section 
     2791, and including coverage under a State health benefits 
     risk pool);
       ``(B) coverage under a group health plan (as defined in 
     such section, and including coverage under a church plan, a 
     governmental plan, or a collectively bargained plan);
       ``(C) coverage under a Federal health care program (as 
     defined by section 1128B(f) of the Social Security Act); or
       ``(D) such other health benefits coverage as the Secretary 
     recognizes for purposes of this section.
       ``(4) Manufacturer.--The term `manufacturer' has the 
     meaning given such term in section 1927(k) of the Social 
     Security Act.
       ``(d) Program Integrity.--
       ``(1) Manufacturer compliance.--
       ``(A) In general.--From amounts appropriated under 
     subsection (f), the Secretary shall provide for improvements 
     in compliance by manufacturers with the requirements of this 
     section in order to prevent overcharges and other violations 
     of the discounted pricing requirements specified in this 
     section.
       ``(B) Improvements.--The improvements described in 
     subparagraph (A) shall include the following:
       ``(i) The establishment of a process to enable the 
     Secretary to verify the accuracy of ceiling prices calculated 
     by manufacturers under subsection (a)(1) and charged to 
     covered entities, which shall include the following:

       ``(I) Developing and publishing through an appropriate 
     policy or regulatory issuance, precisely defined standards 
     and methodology for the calculation of ceiling prices under 
     such subsection.
       ``(II) Comparing regularly the ceiling prices calculated by 
     the Secretary with the quarterly pricing data that is 
     reported by manufacturers to the Secretary.
       ``(III) Conducting periodic monitoring of sales 
     transactions by covered entities.
       ``(IV) Inquiring into any discrepancies between ceiling 
     prices and manufacturer pricing data that may be identified 
     and taking, or requiring manufacturers to take, corrective 
     action in response to such discrepancies, including the 
     issuance of refunds pursuant to the procedures set forth in 
     clause (ii).

       ``(ii) The establishment of procedures for manufacturers to 
     issue refunds to covered entities in the event that there is 
     an overcharge by the manufacturers, including the following:

       ``(I) Providing the Secretary with an explanation of why 
     and how the overcharge occurred, how the refunds will be 
     calculated, and to whom the refunds will be issued.
       ``(II) Oversight by the Secretary to ensure that the 
     refunds are issued accurately and within a reasonable period 
     of time.

       ``(iii) The provision of access through the Internet 
     website supported by the Department of Health and Human 
     Services to the applicable ceiling prices for covered 
     inpatient drugs as calculated and verified by the Secretary 
     in accordance with this section, in a manner (such as through 
     the use of password protection) that limits such access to 
     covered entities and adequately assures security and 
     protection of privileged pricing data from unauthorized re-
     disclosure.
       ``(iv) The development of a mechanism by which--

       ``(I) rebates, discounts, or other price concessions 
     provided by manufacturers to other purchasers subsequent to 
     the sale of covered inpatient drugs to covered entities are 
     reported to the Secretary; and
       ``(II) appropriate credits and refunds are issued to 
     covered entities if such discounts, rebates, or other price 
     concessions have the effect of lowering the applicable 
     ceiling price for the relevant quarter for the drugs 
     involved.

       ``(v) Selective auditing of manufacturers and wholesalers 
     to ensure the integrity of the drug discount program under 
     this section.
       ``(vi) The establishment of a requirement that 
     manufacturers and wholesalers use the identification system 
     developed by the Secretary for purposes of facilitating the 
     ordering, purchasing, and delivery of covered inpatient drugs 
     under this section, including the processing of chargebacks 
     for such drugs.
       ``(vii) The imposition of sanctions in the form of civil 
     monetary penalties, which--

       ``(I) shall be assessed according to standards and 
     procedures established in regulations to be promulgated by 
     the Secretary not later than January 1, 2011;
       ``(II) shall not exceed $10,000 per single dosage form of a 
     covered inpatient drug purchased by a covered entity where a 
     manufacturer knowingly charges such covered entity a price 
     for such drug that exceeds the ceiling price under subsection 
     (a)(1); and
       ``(III) shall not exceed $100,000 for each instance where a 
     manufacturer withholds or provides materially false 
     information to the Secretary or to covered entities under 
     this section or knowingly violates any provision of this 
     section (other than subsection (a)(1)).

       ``(2) Covered entity compliance.--
       ``(A) In general.--From amounts appropriated under 
     subsection (f), the Secretary shall provide for improvements 
     in compliance by covered entities with the requirements of 
     this section in order to prevent diversion and violations of 
     the duplicate discount provision and other requirements 
     specified under subsection (a)(4).
       ``(B) Improvements.--The improvements described in 
     subparagraph (A) shall include the following:
       ``(i) The development of procedures to enable and require 
     covered entities to update at least annually the information 
     on the Internet website supported by the Department of Health 
     and Human Services relating to this section.
       ``(ii) The development of procedures for the Secretary to 
     verify the accuracy of information regarding covered entities 
     that is listed on the website described in clause (i).
       ``(iii) The development of more detailed guidance 
     describing methodologies and options available to covered 
     entities for billing covered inpatient drugs to State 
     Medicaid agencies in a manner that avoids duplicate discounts 
     pursuant to subsection (a)(4)(A).
       ``(iv) The establishment of a single, universal, and 
     standardized identification system by which each covered 
     entity site and each covered entity's purchasing status under 
     sections 340B and this section can be identified by 
     manufacturers, distributors, covered entities, and the 
     Secretary for purposes of facilitating the ordering, 
     purchasing, and delivery of covered inpatient drugs under 
     this section, including the processing of chargebacks for 
     such drugs.
       ``(v) The imposition of sanctions in the form of civil 
     monetary penalties, which--

       ``(I) shall be assessed according to standards and 
     procedures established in regulations promulgated by the 
     Secretary; and
       ``(II) shall not exceed $10,000 for each instance where a 
     covered entity knowingly violates subsection (a)(4)(B) or 
     knowingly violates any other provision of this section.

       ``(vi) The termination of a covered entity's participation 
     in the program under this section, for a period of time to be 
     determined by the Secretary, in cases in which the Secretary 
     determines, in accordance with standards and procedures 
     established by regulation, that--

       ``(I) the violation by a covered entity of a requirement of 
     this section was repeated and knowing; and
       ``(II) imposition of a monetary penalty would be 
     insufficient to reasonably ensure compliance with the 
     requirements of this section.

       ``(vii) The referral of matters, as appropriate, to the 
     Food and Drug Administration, the Office of the Inspector 
     General of the Department of Health and Human Services, or 
     other Federal or State agencies.
       ``(3) Administrative dispute resolution process.--From 
     amounts appropriated under subsection (f), the Secretary may 
     establish and implement an administrative process for the 
     resolution of the following:
       ``(A) Claims by covered entities that manufacturers have 
     violated the terms of their agreement with the Secretary 
     under subsection (a)(1).
       ``(B) Claims by manufacturers that covered entities have 
     violated subsection (a)(4)(A) or (a)(4)(B).
       ``(e) Audit and Sanctions.--
       ``(1) Audit.--From amounts appropriated under subsection 
     (f), the Inspector General of the Department of Health and 
     Human Services (referred to in this subsection as the 
     `Inspector General') shall audit covered entities under this 
     section to verify compliance with criteria for eligibility 
     and participation under this section, including the 
     antidiversion prohibitions under subsection (a)(4)(B), and 
     take enforcement action or provide information to the 
     Secretary who shall take action to ensure program compliance, 
     as appropriate. A covered entity shall provide to the 
     Inspector General, upon request, records relevant to such 
     audits.
       ``(2) Report.--For each audit conducted under paragraph 
     (1), the Inspector General shall prepare and publish in a 
     timely manner a report which shall include findings and 
     recommendations regarding--
       ``(A) the appropriateness of covered entity eligibility 
     determinations and, as applicable, certifications;
       ``(B) the effectiveness of antidiversion prohibitions; and
       ``(C) the effectiveness of restrictions on inpatient 
     dispensing and administration.
       ``(f) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for fiscal year 2011 and each 
     succeeding fiscal year.

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       ``(g) Effect of Section.--Nothing in this section shall be 
     construed to apply to section 340B.''.

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