To amend title II of the Social Security Act to establish a Social Security Surplus Protection Account in the Federal Old-Age and Survivors Insurance Trust Fund to hold the Social Security surplus, to provide for suspension of investment of amounts held in the Account until enactment of legislation providing for investment of the Trust Fund in investment vehicles other than obligations of the United States, and to establish a Social Security Investment Commission to make recommendations for alternative forms of investment of the Social Security surplus in the Trust Fund.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Savings for Seniors Act of 2005''.

SEC. 2. INTERIM PROTECTIONS FOR SOCIAL SECURITY TRUST FUND SURPLUS.

    (a) In General.--Section 201(d) of the Social Security Act (42 
U.S.C. 402(d)) is amended--
            (1) by striking ``It shall be the duty'' and inserting 
        ``(1) Except as provided in paragraph (2), it shall be the 
        duty''; and
            (2) by adding at the end the following new paragraph:
    ``(2)(A) There is established in the Federal Old-Age and Survivors 
Insurance Trust Fund a Social Security Surplus Protection Account. As 
soon as practicable after each fiscal year after 2007, the Managing 
Trustee shall transfer to the Account, from amounts otherwise available 
in the Trust Fund, amounts equivalent to the social security surplus 
for such fiscal year. Such amounts shall be transferred from time to 
time to the Account, such amounts to be determined on the basis of 
estimates by the Managing Trustee, and proper adjustments shall be made 
in amounts subsequently transferred to the extent prior estimates were 
in excess of or were less than the correct amount.
    ``(B) For purposes of subparagraph (A), the term `social security 
surplus' means, for any fiscal year, the excess, if any, of--
            ``(i) the sum of--
                    ``(I) the taxes imposed for such fiscal year by 
                chapter 21 (other than sections 3101(b) and 3111(b)) of 
                the Internal Revenue Code of 1986 with respect to wages 
                (as defined in section 3121 of such Code) reported to 
                the Secretary of the Treasury or his delegates pursuant 
                to subtitle F of such Code, as determined by the 
                Secretary of the Treasury by applying the applicable 
                rates of tax under such chapter 21 (other than sections 
                3101(b) and 3111(b)) to such wages, less the amounts 
                specified in clause (1) of subsection (b) of this 
                section for such fiscal year,
                    ``(II) the taxes imposed by chapter 2 (other than 
                section 1401(b)) of the Internal Revenue Code of 1986 
                with respect to self-employment income (as defined in 
                section 1402 of such Code) reported to the Secretary of 
                the Treasury on tax returns under subtitle F of such 
                Code, as determined by the Secretary of the Treasury by 
                applying the applicable rate of tax under such chapter 
                (other than section 1401(b)) to such self-employment 
                income, less the amounts specified in clause (2) of 
                subsection (b) of this section for such fiscal year, 
                and
                    ``(III) the amount equivalent to the aggregate 
                increase in tax liabilities under chapter 1 of the 
                Internal Revenue Code of 1986 which is attributable to 
                the application of sections 86 and 871(a)(3) of such 
                Code to payments from the Trust Fund, over
            ``(ii) the sum of--
                    ``(I) benefits paid from the Trust Fund during the 
                fiscal year, and
                    ``(II) amounts authorized to be made available from 
                the Trust Fund under subsection (g) of this section 
                which are paid from the Trust Fund during such fiscal 
                year.
    ``(C) Notwithstanding paragraph (1), the balance in the Account 
shall not be available for investment by the Managing Trustee.
    ``(D)(i) The preceding provisions of this paragraph shall not apply 
with respect to fiscal years commencing with or after the first fiscal 
year, after fiscal year 2007, for which a provision of Federal law 
takes effect and authorizes, for amounts in the Trust Fund, an 
investment vehicle other than obligations of the United States 
resulting in the transfer of Trust Fund assets to the general fund of 
the Treasury.
    ``(ii) A provision of Federal law shall be deemed to meet the 
requirements of clause (i) if such provision includes the following: 
`This Act shall be considered to be a provision of Federal law meeting 
the requirements of section 201(d)(2)(D)(i) of the Social Security 
Act.'.''.

SEC. 3. SOCIAL SECURITY INVESTMENT COMMISSION.

    (a) Establishment.--There is established in the executive branch of 
the Government a Social Security Investment Commission.
    (b) Study and Report.--As soon as practicable after the date of the 
enactment of this Act, the Commission shall conduct a study to 
ascertain the most effective vehicles for investment of the Federal 
Old-Age and Survivors Insurance Trust Fund, other than investment in 
the form of obligations of the United States resulting in the transfer 
of Trust Fund assets to the general fund of the Treasury. Not later 
than October 1, 2007, the Commission shall submit a report to the 
President and to each House of the Congress setting forth its 
recommendations for such vehicles for investment, together with 
proposals for such administrative and legislative changes as the 
Commission determines necessary to authorize and implement such 
recommendations.
    (c) Composition.--The Commission shall be composed of--
            (1) 3 members appointed by the President, of whom 1 shall 
        be designated by the President as Chairman;
            (2) 2 members appointed by the Speaker of the House of 
        Representatives;
            (3) 1 member appointed by the minority leader of the House 
        of Representatives;
            (4) 2 members appointed by the majority leader of the 
        Senate; and
            (5) 1 member appointed by the minority leader of the 
        Senate.
    (d) Membership Requirements.--Members of the Commission shall have 
substantial experience, training, and expertise in the management of 
financial investments and pension benefit plans.
    (e) Length of Appointments.--Members of the Commission shall serve 
for the life of the Commission. A vacancy on the Commission shall be 
filled in the manner in which the original appointment was made and 
shall be subject to any conditions that applied with respect to the 
original appointment.
    (f) Duties.--As soon as the Commission shall--
            (1) administer the program established under this part;
            (2) establish policies for the investment and management of 
        the Savings Fund, including the Tier I Investment Fund and the 
        Tier II Investment Fund, and amounts held under Tier III 
        Investment Options, including policies applicable to the asset 
        managers, recordkeepers, and custodians with responsibility for 
        managing the investment of amounts credited to personal social 
        security investment accounts, and for the management and 
        operation of personal social security savings annuities, which 
        shall provide for--
                    (A) prudent investments suitable for accumulating 
                funds for payment of retirement income;
                    (B) sound management practices; and
                    (C) low administrative costs;
            (3) review the performance of investments made for the Tier 
        I Investment Fund and the Tier II Investment Fund;
            (4) review the performance of investments made under Tier 
        III Investment Options;
            (5) review the management and operation of personal social 
        security savings annuities;
            (6) review and approve the budget of the Commission; and
            (7) comply with the fiduciary requirements of part 4 of 
        subtitle B of title I of the Employee Retirement Income 
        Security Act of 1974 (relating to fiduciary responsibility) in 
        connection with any exercise of discretion in connection with 
        the assets of the Savings Fund.
    (g) Administrative Provisions.--
            (1) Meetings.--The Commission shall meet--
                    (A) not less than once during each month; and
                    (B) at additional times at the call of the 
                Chairman.
            (2) Exercise of powers.--
                    (A) In general.--The Commission shall perform the 
                functions and exercise the powers of the Commission on 
                a majority vote of a quorum of the Commission. Three 
                members of the Commission shall constitute a quorum for 
                the transaction of business.
                    (B) Vacancies.--A vacancy on the Commission shall 
                not impair the authority of a quorum of the Commission 
                to perform the functions and exercise the powers of the 
                Commission.
    (h) Compensation.--
            (1) In general.--Each member of the Commission who is not 
        an officer or employee of the Federal Government shall be 
        compensated at the daily rate of basic pay for level IV of the 
        Executive Schedule for each day during which such member is 
        engaged in performing a function of the Commission.
            (2) Expenses.--A member of the Commission shall be paid 
        travel, per diem, and other necessary expenses under subchapter 
        I of chapter 57 of title 5, United States Code, while traveling 
        away from such member's home or regular place of business in 
        the performance of the duties of the Commission.
    (i) Termination.--The Commission shall terminate 90 days after the 
date of the submission of its report pursuant to subsection (b).

Summary: Savings for Seniors Act of 2005 - Amends title II (OASDI) of the Social Security Act to establish in the Federal Old-Age and Survivors Insurance Trust Fund a Social Security Surplus Protection Account to hold the Social Security surplus. Denies the availability of the balance in the Account for investment by the Managing Trustee. Establishes in the executive branch of Government a Social Security Investment Commission to study and report to the President and Congress on the most effective vehicles for investment of the Federal Old-Age and Survivors Insurance Trust Fund, other than investment in the form of US obligations resulting in the transfer of Trust Fund assets to the general fund of the Treasury.