Page 499 TITLE 29—LABOR § 1306

EFFECTIVE DATE OF 1987 AMENDMENT

Amendment by section 9312(c)(4) of Pub. L. 100–203 applicable with respect to plan terminations under section 1341 of this title with respect to which notices of

intent to terminate are provided under section

1341(a)(2) of this title after Dec. 17, 1987, and plan terminations with respect to which proceedings are instituted by the Pension Benefit Guaranty Corporation

under section 1342 of this title after that date, see section 9312(d)(1) of Pub. L. 100–203, as amended, set out as

a note under section 1301 of this title.

Section 9331(f) of Pub. L. 100–203 provided that:

‘‘(1) IN GENERAL.—The amendments made by this section [amending this section and sections 1306 and 1307

of this title] shall apply to plan years beginning after

December 31, 1987.

‘‘(2) SEPARATE ACCOUNTING.—The amendments made

by subsection (d) [amending this section] shall apply to

fiscal years beginning after September 30, 1988.’’

EFFECTIVE DATE OF 1986 AMENDMENT

Amendment by Pub. L. 99–272 effective Jan. 1, 1986,

with certain exceptions, see section 11019 of Pub. L.

99–272, set out as a note under section 1341 of this title.

EFFECTIVE DATE OF 1980 AMENDMENT

Amendment by Pub. L. 96–364 effective Sept. 26, 1980,

except as specifically provided, see section 1461(e) of

this title.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1301, 1302, 1308,

1322a, 1361, 1461 of this title.

§ 1306. Premium rates

(a) Schedules for premium rates and bases for

application; establishment, coverage, etc.

(1) The corporation shall prescribe such schedules of premium rates and bases for the application of those rates as may be necessary to provide sufficient revenue to the fund for the corporation to carry out its functions under this

subchapter. The premium rates charged by the

corporation for any period shall be uniform for

all plans, other than multiemployer plans, insured by the corporation with respect to basic

benefits guaranteed by it under section 1322 of

this title, and shall be uniform for all multiemployer plans with respect to basic benefits guaranteed by it under section 1322a of this title.

(2) The corporation shall maintain separate

schedules of premium rates, and bases for the

application of those rates, for—

(A) basic benefits guaranteed by it under

section 1322 of this title for single-employer

plans,

(B) basic benefits guaranteed by it under

section 1322a of this title for multiemployer

plans,

(C) nonbasic benefits guaranteed by it under

section 1322 of this title for single-employer

plans,

(D) nonbasic benefits guaranteed by it under

section 1322a of this title for multiemployer

plans, and

(E) reimbursements of uncollectible withdrawal liability under section 1402 of this title.

The corporation may revise such schedules

whenever it determines that revised schedules

are necessary. Except as provided in section

1322a(f) of this title, in order to place a revised

schedule described in subparagraph (A) or (B) in

effect, the corporation shall proceed in accordance with subsection (b)(1) of this section, and

such schedule shall apply only to plan years beginning more than 30 days after the date on

which a joint resolution approving such revised

schedule is enacted.

(3)(A) Except as provided in subparagraph (C),

the annual premium rate payable to the corporation by all plans for basic benefits guaranteed under this subchapter is—

(i) in the case of a single-employer plan, for

plan years beginning after December 31, 1990,

an amount equal to the sum of $19 plus the additional premium (if any) determined under

subparagraph (E) for each individual who is a

participant in such plan during the plan year;

(ii) in the case of a multiemployer plan, for

the plan year within which the date of enactment of the Multiemployer Pension Plan

Amendments Act of 1980 falls, an amount for

each individual who is a participant in such

plan for such plan year equal to the sum of—

(I) 50 cents, multiplied by a fraction the

numerator of which is the number of months

in such year ending on or before such date

and the denominator of which is 12, and

(II) $1.00, multiplied by a fraction equal to

1 minus the fraction determined under

clause (i),

(iii) in the case of a multiemployer plan, for

plan years beginning after September 26, 1980,

an amount equal to—

(I) $1.40 for each participant, for the first,

second, third, and fourth plan years,

(II) $1.80 for each participant, for the fifth

and sixth plan years,

(III) $2.20 for each participant, for the seventh and eighth plan years, and

(IV) $2.60 for each participant, for the

ninth plan year, and for each succeeding

plan year.

(B) The corporation may prescribe by regulation the extent to which the rate described in

subparagraph (A)(i) applies more than once for

any plan year to an individual participating in

more than one plan maintained by the same employer, and the corporation may prescribe regulations under which the rate described in subparagraph (A)(iii) will not apply to the same

participant in any multiemployer plan more

than once for any plan year.

(C)(i) If the sum of—

(I) the amounts in any fund for basic benefits guaranteed for multiemployer plans, and

(II) the value of any assets held by the corporation for payment of basic benefits guaranteed for multiemployer plans,

is for any calendar year less than 2 times the

amount of basic benefits guaranteed by the corporation under this subchapter for multiemployer plans which were paid out of any such

fund or assets during the preceding calendar

year, the annual premium rates under subparagraph (A) shall be increased to the next highest

premium level necessary to insure that such

sum will be at least 2 times greater than such

amount during the following calendar year.

(ii) If the board of directors of the corporation

determines that an increase in the premium

rates under subparagraph (A) is necessary to
§ 1306 TITLE 29—LABOR Page 500

provide assistance to plans which are receiving

assistance under section 1431 of this title and to

plans the board finds are reasonably likely to require such assistance, the board may order such

increase in the premium rates.

(iii) The maximum annual premium rate

which may be established under this subparagraph is $2.60 for each participant.

(iv) The provisions of this subparagraph shall

not apply if the annual premium rate is increased to a level in excess of $2.60 per participant under any other provisions of this subchapter.

(D)(i) Not later than 120 days before the date

on which an increase under subparagraph (C)(ii)

is to become effective, the corporation shall

publish in the Federal Register a notice of the

determination described in subparagraph (C)(ii),

the basis for the determination, the amount of

the increase in the premium, and the anticipated increase in premium income that would

result from the increase in the premium rate.

The notice shall invite public comment, and

shall provide for a public hearing if one is requested. Any such hearing shall be commenced

not later than 60 days before the date on which

the increase is to become effective.

(ii) The board of directors shall review the

hearing record established under clause (i) and

shall, not later than 30 days before the date on

which the increase is to become effective, determine (after consideration of the comments received) whether the amount of the increase

should be changed and shall publish its determination in the Federal Register.

(E)(i) The additional premium determined

under this subparagraph with respect to any

plan for any plan year shall be an amount equal

to the amount determined under clause (ii) divided by the number of participants in such plan

as of the close of the preceding plan year.

(ii) The amount determined under this clause

for any plan year shall be an amount equal to

$9.00 for each $1,000 (or fraction thereof) of unfunded vested benefits under the plan as of the

close of the preceding plan year.

(iii) For purposes of clause (ii)—

(I) Except as provided in subclause (II) or

(III), the term ‘‘unfunded vested benefits’’

means the amount which would be the unfunded current liability (within the meaning

of section 1082(d)(8)(A) of this title) if only

vested benefits were taken into account.

(II) The interest rate used in valuing vested

benefits for purposes of subclause (I) shall be

equal to the applicable percentage of the annual yield on 30-year Treasury securities for

the month preceding the month in which the

plan year begins. For purposes of this subclause, the applicable percentage is 80 percent

for plan years beginning before July 1, 1997, 85

percent for plan years beginning after June 30,

1997, and before the 1st plan year to which the

first tables prescribed under section

1082(d)(7)(C)(ii)(II) of this title apply, and 100

percent for such 1st plan year and subsequent

plan years.

(III) In the case of any plan year for which

the applicable percentage under subclause (II)

is 100 percent, the value of the plan’s assets

used in determining unfunded current liability

under subclause (I) shall be their fair market

value.

(iv) No premium shall be determined under

this subparagraph for any plan year if, as of the

close of the preceding plan year, contributions

to the plan for the preceding plan year were not

less than the full funding limitation for the preceding plan year under section 412(c)(7) of title

26.

(4) The corporation may prescribe, subject to

the enactment of a joint resolution in accordance with this section or section 1322a(f) of this

title, alternative schedules of premium rates,

and bases for the application of those rates, for

basic benefits guaranteed by it under sections

1322 and 1322a of this title based, in whole or in

part, on the risks insured by the corporation in

each plan.

(5)(A) In carrying out its authority under

paragraph (1) to establish schedules of premium

rates, and bases for the application of those

rates, for nonbasic benefits guaranteed under

sections 1322 and 1322a of this title the premium

rates charged by the corporation for any period

for nonbasic benefits guaranteed shall—

(i) be uniform by category of nonbasic benefits guaranteed,

(ii) be based on the risks insured in each category, and

(iii) reflect the experience of the corporation

(including experience which may be reasonably anticipated) in guaranteeing such benefits.

(B) Notwithstanding subparagraph (A), premium rates charged to any multiemployer plan

by the corporation for any period for supplemental guarantees under section 1322a(g)(2) of

this title may reflect any reasonable considerations which the corporation determines to be

appropriate.

(6)(A) In carrying out its authority under

paragraph (1) to establish premium rates and

bases for basic benefits guaranteed under section 1322 of this title with respect to single-employer plans, the corporation shall establish

such rates and bases in coverage schedules in accordance with the provisions of this paragraph.

(B) The corporation may establish annual premiums for single-employer plans composed of

the sum of—

(i) a charge based on a rate applicable to the

excess, if any, of the present value of the basic

benefits of the plan which are guaranteed over

the value of the assets of the plan, not in excess of 0.1 percent, and

(ii) an additional charge based on a rate applicable to the present value of the basic benefits of the plan which are guaranteed.

The rate for the additional charge referred to in

clause (ii) shall be set by the corporation for

every year at a level which the corporation estimates will yield total revenue approximately

equal to the total revenue to be derived by the

corporation from the charges referred to in

clause (i) of this subparagraph.

(C) The corporation may establish annual premiums for single-employer plans based on—

(i) the number of participants in a plan, but

such premium rates shall not exceed the rates

described in paragraph (3),
Page 501 TITLE 29—LABOR § 1306

1So in original. The word ‘‘and’’ probably should not appear.

(ii) unfunded basic benefits guaranteed

under this subchapter, but such premium rates

shall not exceed the limitations applicable to

charges referred to in subparagraph (B)(i), or

(iii) total guaranteed basic benefits, but

such premium rates shall not exceed the rates

for additional charges referred to in subparagraph (B)(ii).

If the corporation uses two or more of the rate

bases described in this subparagraph, the premium rates shall be designed to produce approximately equal amounts of aggregate premium revenue from each of the rate bases used.

(D) For purposes of this paragraph, the corporation shall by regulation define the terms

‘‘value of assets’’ and ‘‘present value of the benefits of the plan which are guaranteed’’ in a

manner consistent with the purposes of this subchapter and the provisions of this section.

(b) Revised schedule; Congressional procedures

applicable

(1) In order to place a revised schedule (other

than a schedule described in subsection (a)(2)(C),

(D), or (E) of this section) in effect, the corporation shall transmit the proposed schedule, its

proposed effective date, and the reasons for its

proposal to the Committee on Ways and Means

and the Committee on Education and Labor of

the House of Representatives, and to the Committee on Finance and the Committee on Labor

and Human Resources of the Senate.

(2) The succeeding paragraphs of this subsection are enacted by Congress as an exercise of

the rulemaking power of the Senate and the

House of Representatives, respectively, and as

such they shall be deemed a part of the rules of

each House, respectively, but applicable only

with respect to the procedure to be followed in

that House in the case of resolutions described

in paragraph (3). They shall supersede other

rules only to the extent that they are inconsistent therewith. They are enacted with full recognition of the constitutional right of either

House to change the rules (so far as relating to

the procedure of that House) at any time, in the

same manner and to the same extent as in the

case of any rule of that House.

(3) For the purpose of the succeeding paragraphs of this subsection, ‘‘resolution’’ means

only a joint resolution, the matter after the resolving clause of which is as follows: ‘‘The proposed revised schedule transmitted to Congress

by the Pension Benefit Guaranty Corporation on

ll is hereby approved.’’, the blank space therein being filled with the date on which the corporation’s message proposing the rate was delivered.

(4) A resolution shall be referred to the Committee on Ways and Means and the Committee

on Education and Labor of the House of Representatives and to the Committee on Finance

and the Committee on Labor and Human Resources of the Senate.

(5) If a committee to which has been referred

a resolution has not reported it before the expiration of 10 calendar days after its introduction,

it shall then (but not before) be in order to move

to discharge the committee from further consideration of that resolution, or to discharge the

committee from further consideration of any

other resolution with respect to the proposed

adjustment which has been referred to the committee. The motion to discharge may be made

only by a person favoring the resolution, shall

be highly privileged (except that it may not be

made after the committee has reported a resolution with respect to the same proposed rate),

and debate thereon shall be limited to not more

than 1 hour, to be divided equally between those

favoring and those opposing the resolution. An

amendment to the motion is not in order, and it

is not in order to move to reconsider the vote by

which the motion is agreed to or disagreed to. If

the motion to discharge is agreed to or disagreed to, the motion may not be renewed, nor

may another motion to discharge the committee

be made with respect to any other resolution

with respect to the same proposed rate.

(6) When a committee has reported, or has

been discharged from further consideration of a

resolution, it is at any time thereafter in order

(even though a previous motion to the same effect has been disagreed to) to move to proceed to

the consideration of the resolution. The motion

is highly privileged and is not debatable. An

amendment to the motion is not in order, and it

is not in order to move to reconsider the vote by

which the motion is agreed to or disagreed to.

Debate on the resolution shall be limited to not

more than 10 hours, which shall be divided

equally between those favoring and those opposing the resolution. A motion further to limit debate is not debatable. An amendment to, or motion to recommit, the resolution is not in order,

and it is not in order to move to reconsider the

vote by which the resolution is agreed to or disagreed to.

(7) Motions to postpone, made with respect to

the discharge from committee, or the consideration of, a resolution and motions to proceed to

the consideration of other business shall be decided without debate. Appeals from the decisions of the Chair relating to the application of

the rules of the Senate or the House of Representatives, as the case may be, to the procedure relating to a resolution shall be decided

without debate.

(c) Rates for plans for basic benefits

(1) Except as provided in subsection (a)(3) of

this section, and subject to paragraph (2), the

rate for all plans for basic benefits guaranteed

under this subchapter with respect to plan years

ending after September 2, 1974, is—

(A) in the case of each plan which was not a

multiemployer plan in a plan year—

(i) with respect to each plan year beginning before January 1, 1978, an amount equal

to $1 for each individual who was a participant in such plan during the plan year,

(ii) with respect to each plan year beginning after December 31, 1977, and before January 1, 1986, an amount equal to $2.60 for

each individual who was a participant in

such plan during the plan year, and 1

(iii) with respect to each plan year beginning after December 31, 1985, and before January 1, 1988, an amount equal to $8.50 for

each individual who was a participant in

such plan during the plan year, and
§ 1306 TITLE 29—LABOR Page 502

(iv) with respect to each plan year beginning after December 31, 1987, and before January 1, 1991, an amount equal to $16 for each

individual who was a participant in such

plan during the plan year, and

(B) in the case of each plan which was a

multiemployer plan in a plan year, an amount

equal to 50 cents for each individual who was

a participant in such plan during the plan

year.

(2) The rate applicable under this subsection

for the plan year preceding September 1, 1975, is

the product of—

(A) the rate described in the preceding sentence; and

(B) a fraction—

(i) the numerator of which is the number

of calendar months in the plan year which

ends after September 2, 1974, and before the

date on which the new plan year commences,

and

(ii) the denominator of which is 12.

(Pub. L. 93–406, title IV, §4006, Sept. 2, 1974, 88

Stat. 1010; Pub. L. 96–364, title I, §105, Sept. 26,

1980, 94 Stat. 1264; Pub. L. 99–272, title XI,

§11005(a)–(c)(3), Apr. 7, 1986, 100 Stat. 240–242;

Pub. L. 100–203, title IX, §9331(a), (b), (e), Dec. 22,

1987, 101 Stat. 1330–367, 1330–368; Pub. L. 101–239,

title VII, §7881(h), Dec. 19, 1989, 103 Stat. 2442;

Pub. L. 101–508, title XII, §12021(a), (b), Nov. 5,

1990, 104 Stat. 1388–573; Pub. L. 103–465, title VII,

§774(a)(1), (b)(1), (2), Dec. 8, 1994, 108 Stat. 5045,

5046.)

REFERENCES IN TEXT

The plan year within which the date of enactment of

the Multiemployer Pension Plan Amendments Act of

1980 falls, referred to in subsec. (a)(3)(A)(ii), refers to

the plan year within which the date of the enactment

of Pub. L. 96–364 falls, such enactment being approved

Sept. 26, 1980.

AMENDMENTS

1994—Subsec. (a)(3)(E)(iii). Pub. L. 103–465, §774(b)(1),

(2), in subcl. (I), inserted ‘‘or (III)’’ after ‘‘subclause

(II)’’, in subcl. (II), substituted ‘‘equal to the applicable

percentage’’ for ‘‘equal to 80 percent’’ and inserted at

end ‘‘For purposes of this subclause, the applicable percentage is 80 percent for plan years beginning before

July 1, 1997, 85 percent for plan years beginning after

June 30, 1997, and before the 1st plan year to which the

first tables prescribed under section 1082(d)(7)(C)(ii)(II)

of this title apply, and 100 percent for such 1st plan

year and subsequent plan years.’’, and added subcl.

(III).

Subsec. (a)(3)(E)(iv), (v). Pub. L. 103–465, §774(a)(1), redesignated cl. (v) as (iv) and struck out former cl. (iv)

which read as follows:

‘‘(iv)(I) Except as provided in this clause, the aggregate increase in the premium payable with respect to

any participant by reason of this subparagraph shall

not exceed $53.

‘‘(II) If an employer made contributions to a plan during 1 or more of the 5 plan years preceding the 1st plan

year to which this subparagraph applies in an amount

not less than the maximum amount allowable as a deduction with respect to such contributions under section 404 of title 26, the dollar amount in effect under

subclause (I) for the 1st 5 plan years to which this subparagraph applies shall be reduced by $3 for each plan

year for which such contributions were made in such

amount.’’

1990—Subsec. (a)(3)(A)(i). Pub. L. 101–508, §12021(a)(1),

substituted ‘‘for plan years beginning after December

31, 1990, an amount equal to the sum of $19’’ for ‘‘for

plan years beginning after December 31, 1987, an

amount equal to the sum of $16’’.

Subsec. (a)(3)(E)(ii). Pub. L. 101–508, §12021(b)(1), substituted ‘‘$9.00’’ for ‘‘$6.00’’.

Subsec. (a)(3)(E)(iv)(I). Pub. L. 101–508, §12021(b)(2),

substituted ‘‘$53’’ for ‘‘$34’’.

Subsec. (c)(1)(A)(iv). Pub. L. 101–508, §12021(a)(2),

added cl. (iv).

1989—Subsec. (a)(3)(E)(v). Pub. L. 101–239, §7881(h)(1),

added cl. (v).

Subsec. (c)(1)(A)(iii). Pub. L. 101–239, §7881(h)(2), realigned margin.

1987—Subsec. (a)(3)(A)(i). Pub. L. 100–203, §9331(a),

substituted ‘‘for plan years beginning after December

31, 1987, an amount equal to the sum of $16 plus the additional premium (if any) determined under subparagraph (E)’’ for ‘‘for plan years beginning after December 31, 1985, an amount equal to $8.50’’.

Subsec. (a)(3)(E). Pub. L. 100–203, §9331(b), added subpar. (E).

Subsec. (c)(1)(A). Pub. L. 100–203, §9331(e), struck out

‘‘and’’ at end of cl. (i), inserted ‘‘and before January 1,

1986,’’ in cl. (ii), and added cl. (iii).

1986—Subsec. (a)(1). Pub. L. 99–272, §11005(b)(1), struck

out provision that in establishing annual premiums

with respect to plans, other than multiemployer plans,

pars. (5) and (6) of this subsection, as in effect before

Sept. 26, 1980, would continue to apply.

Subsec. (a)(2). Pub. L. 99–272, §11005(c)(1), substituted

‘‘a joint resolution approving such revised schedule is

enacted’’ for ‘‘the Congress approves such revised

schedule by a concurrent resolution’’.

Subsec. (a)(3)(A)(i). Pub. L. 99–272, §11005(a)(1), substituted ‘‘December 31, 1985, an amount equal to $8.50’’

for ‘‘December 31, 1977, an amount equal to $2.60’’.

Subsec. (a)(4). Pub. L. 99–272, §11005(c)(2), substituted

‘‘the enactment of a joint resolution’’ for ‘‘approval by

the Congress’’.

Subsec. (a)(6). Pub. L. 99–272, §11005(b)(2), added par.

(6).

Subsec. (b)(3). Pub. L. 99–272, §11005(c)(3), substituted

‘‘joint’’ for ‘‘concurrent’’ and ‘‘The’’ for ‘‘That the Congress favors the’’ and inserted ‘‘is hereby approved’’.

Subsec. (c)(1)(A). Pub. L. 99–272, §11005(a)(2), amended

subpar. (A) generally. Prior to amendment, subpar. (A)

read as follows: ‘‘in the case of each plan which was not

a multiemployer plan in a plan year, an amount equal

to $1 for each individual who was a participant in such

plan during the plan year, and’’.

1980—Subsec. (a). Pub. L. 96–364, §105(a), substituted

provisions setting forth authority of corporation to

prescribe schedules of premium rates and bases for the

application of such rates and provisions respecting contents, coverages, alternate schedules, etc., of schedules

and application bases, for provisions setting forth authority of corporation to prescribe insurance premium

rates and coverage schedules for the application of such

rates and provisions respecting contents, coverages,

rates, etc., of schedules and premium rates.

Subsec. (b). Pub. L. 96–364, §105(b), in par. (1) substituted ‘‘(C), (D), or (E)’’ for ‘‘(B) or (C)’’, ‘‘revised

schedule’’ for ‘‘revised coverage schedule’’, and

‘‘Human Resources’’ for ‘‘Public Welfare’’, in par. (3)

substituted ‘‘revised schedule’’ for ‘‘revised coverage

schedule’’, and in par. (4) substituted ‘‘Human Resources’’ for ‘‘Public Welfare’’.

Subsec. (c). Pub. L. 96–364, §105(c), added subsec. (c).

CHANGE OF NAME

Committee on Education and Labor of House of Representatives treated as referring to Committee on Economic and Educational Opportunities of House of Representatives by section 1(a) of Pub. L. 104–14, set out as

a note preceding section 21 of Title 2, The Congress.

Committee on Economic and Educational Opportunities of House of Representatives changed to Committee

on Education and the Workforce of House of Representatives by House Resolution No. 5, One Hundred Fifth

Congress, Jan. 7, 1997.
Page 503 TITLE 29—LABOR § 1306

EFFECTIVE DATE OF 1994 AMENDMENT

Section 774(a)(2) of Pub. L. 103–465 provided that:

‘‘(A) IN GENERAL.—The amendments made by this

subsection [amending this section] shall be effective for

plan years beginning on or after July 1, 1994.

‘‘(B) TRANSITION RULE.—In the case of plan years beginning on or after July 1, 1994, and before July 1, 1996,

the additional premium payable with respect to any

participant by reason of the amendments made by this

section shall not exceed the sum of—

‘‘(i) $53, and

‘‘(ii) the product derived by multiplying—

‘‘(I) the excess (if any) of the amount determined

under clause (i) of section 4006(a)(3)(E) of the Employee Retirement Income Security Act of 1974

[subsec. (a)(3)(E) of this section], over $53, by

‘‘(II) the applicable percentage.

For purposes of this subparagraph, the applicable percentage shall be the percentage specified in the following table:

For the plan year beginning: The applicable

percentage is: on or after but before

July 1, 1994 .......... July 1, 1995 ........ 20 percent

July 1, 1995 .......... July 1, 1996 ........ 60 percent.’’

Section 774(b)(3) of Pub. L. 103–465 provided that:

‘‘The amendments made by this subsection [amending

this section] shall apply to plan years beginning after

the date of the enactment of this Act [Dec. 8, 1994].

EFFECTIVE DATE OF 1990 AMENDMENT

Section 12021(c) of Pub. L. 101–508 provided that: ‘‘The

amendments made by this section [amending this section] shall apply to plan years beginning after December 31, 1990.’’

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by Pub. L. 101–239 effective, except as

otherwise provided, as if included in the provision of

the Pension Protection Act, Pub. L. 100–203, §§9302–9346,

to which such amendment relates, see section 7882 of

Pub. L. 101–239, set out as a note under section 401 of

Title 26, Internal Revenue Code.

EFFECTIVE DATE OF 1987 AMENDMENT

Amendment by Pub. L. 100–203 applicable to plan

years beginning after Dec. 31, 1987, see section 9331(f)(1)

of Pub. L. 100–203, set out as a note under section 1305

of this title.

EFFECTIVE DATE OF 1986 AMENDMENT

Section 11005(d) of Pub. L. 99–272 provided that:

‘‘(1) GENERAL RULE.—Except as provided in paragraph

(2), the amendments made by this section [amending

this section and section 1322a of this title] shall be effective for plan years commencing after December 31,

1985.

‘‘(2) SPECIAL RULE.—The amendments made by subsection (b) [amending this section] shall be effective as

of the date of the enactment of the Multiemployer Pension Plan Amendments Act of 1980 [Sept. 26, 1980].’’

EFFECTIVE DATE OF 1980 AMENDMENT

Amendment by Pub. L. 96–364 effective Sept. 26, 1980,

except as specifically provided, see section 1461(e) of

this title.

TRANSITIONAL RULE

Section 774(c) of Pub. L. 103–465 provided that: ‘‘In the

case of a regulated public utility described in section

7701(a)(33)(A)(i) of the Internal Revenue Code of 1986 [26

U.S.C. 7701(a)(33)(A)(i)], the amendments made by this

section [amending this section] shall not apply to plan

years beginning before the earlier of—

‘‘(1) January 1, 1998, or

‘‘(2) the date the regulated public utility begins to

collect from utility customers rates that reflect the

costs incurred or projected to be incurred for additional premiums under section 4006(a)(3)(E) of the

Employee Retirement Income Security Act of 1974

[subsec. (a)(3)(E) of this section] pursuant to final and

nonappealable determinations by all public utility

commissions (or other authorities having jurisdiction

over the rates and terms of service by the regulated

public utility) that the costs are just and reasonable

and recoverable from customers of the regulated public utility.’’

Section 11005(e) of Pub. L. 99–272 provided that:

‘‘(1) NOTICE OF PREMIUM INCREASE.—Not later than 30

days after the date of the enactment of this Act [Apr.

7, 1986], the Pension Benefit Guaranty Corporation

shall send a notice to the plan administrator of each

single-employer plan affected by the premium increase

established by the amendment made by subsection

(a)(1) [amending this section]. Such notice shall describe such increase and the requirements of this subsection.

‘‘(2) DUE DATE FOR UNPAID PREMIUMS.—With respect to

any plan year beginning during the period beginning on

January 1, 1986, and ending 30 days after the date of the

enactment of this Act, any unpaid amount of such premium increase shall be due and payable no later than

the earlier of 60 days after the date of the enactment

of this Act or 30 days after the date on which the notice

required by paragraph (1) is sent, except that in no

event shall the amount of the premium increase established under the amendment made by subsection (a)(1)

be due and payable for a plan year earlier than the date

on which premiums for the plan would have been due

for such plan year had this Act [probably means the

Single-Employee Pension Plan Amendments Act of

1986, title XI of Pub. L. 99–272, see Short Title of 1986

Amendment note set out under section 1001 of this

title] not been enacted.

‘‘(3) ENFORCEMENT.—For purposes of enforcement, the

requirements of paragraphs (1) and (2) shall be considered to be requirements of sections 4006 and 4007 of the

Employee Retirement Income Security Act of 1974 (29

U.S.C. 1306 and 1307).’’

SINGLE-EMPLOYER PENSION PLAN TERMINATION

INSURANCE PREMIUM STUDY

Section 11017(a) of Pub. L. 99–272 directed Pension

Benefit Guaranty Corporation to conduct a study of,

and submit to an advisory council not later than one

year after Apr. 7, 1986, a report on the premiums established under the single-employer pension plan termination insurance program under this subchapter, including (1) the long-term stability of the program, (2)

alternatives with respect to proposals for changes in

the premium levels under such program, (3) methods

currently used in projecting future costs, (4) alternative methods of projecting such future costs, (5)

methods currently used in determining premiums needed to allocate and adequately fund such future costs,

along with any alternative methods of making such

premium determinations, and (6) alternative premium

bases upon which some or all of such projected future

costs would be allocated on an exposure-related or riskrelated computation; and further provided for submission of the advisory council’s report to Congress 180

days after submission of the Corporation’s report to the

advisory council, as well as the cooperation and consultation with other Federal agencies in compilation of

reports.

STUDIES AND REPORTS RESPECTING GRADUATED PREMIUM RATE SCHEDULES AND UNION MANDATED WITHDRAWALS FROM MULTIEMPLOYER PENSION PLANS

Section 412(a) of Pub. L. 96–364 directed Pension Benefit Guaranty Corporation to conduct a separate study

with respect to advantages and disadvantages of establishing a graduated premium rate schedule under this

section which is based on risk, and necessity of adopting special rules in cases of union-mandated withdrawal from multiemployer pension plans, and to re-
§ 1307 TITLE 29—LABOR Page 504

port to Congress the results of the studies conducted,

including its recommendations with respect thereto.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1082, 1302, 1305,

1310, 1311, 1322a, 1343 of this title; title 26 section 412.

§ 1307. Payment of premiums

(a) Premiums payable when due; accrual; waiver

or reduction

The designated payor of each plan shall pay

the premiums imposed by the corporation under

this subchapter with respect to that plan when

they are due. Premiums under this subchapter

are payable at the time, and on an estimated,

advance, or other basis, as determined by the

corporation. Premiums imposed by this subchapter on September 2, 1974 (applicable to that

portion of any plan year during which such date

occurs) are due within 30 days after such date.

Premiums imposed by this subchapter on the

first plan year commencing after September 2,

1974, are due within 30 days after such plan year

commences. Premiums shall continue to accrue

until a plan’s assets are distributed pursuant to

a termination procedure, or until a trustee is

appointed pursuant to section 1342 of this title,

whichever is earlier. The corporation may waive

or reduce premiums for a multiemployer plan

for any plan year during which such plan receives financial assistance from the corporation

under section 1431 of this title, except that any

amount so waived or reduced shall be treated as

financial assistance under such section.

(b) Late payment charge; waiver

If any basic benefit premium is not paid when

it is due the corporation is authorized to assess

a late payment charge of not more than 100 percent of the premium payment which was not

timely paid. The preceding sentence shall not

apply to any payment of premium made within

60 days after the date on which payment is due,

if before such date, the designated payor obtains

a waiver from the corporation based upon a

showing of substantial hardship arising from the

timely payment of the premium. The corporation is authorized to grant a waiver under this

subsection upon application made by the designated payor, but the corporation may not

grant a waiver if it appears that the designated

payor will be unable to pay the premium within

60 days after the date on which it is due. If any

premium is not paid by the last date prescribed

for a payment, interest on the amount of such

premium at the rate imposed under section

6601(a) of title 26 (relating to interest on underpayment, nonpayment, or extensions of time for

payment of tax) shall be paid for the period from

such last date to the date paid.

(c) Civil action to recover premium penalty and

interest

If any designated payor fails to pay a premium

when due, the corporation is authorized to bring

a civil action in any district court of the United

States within the jurisdiction of which the plan

assets are located, the plan is administered, or

in which a defendant resides or is found for the

recovery of the amount of the premium penalty,

and interest, and process may be served in any

other district. The district courts of the United

States shall have jurisdiction over actions

brought under this subsection by the corporation without regard to the amount in controversy.

(d) Basic benefits guarantee not stopped by designated payor’s failure to pay premiums

when due

The corporation shall not cease to guarantee

basic benefits on account of the failure of a designated payor to pay any premium when due.

(e) Designated payor

(1) For purposes of this section, the term ‘‘designated payor’’ means—

(A) the contributing sponsor or plan administrator in the case of a single-employer plan,

and

(B) the plan administrator in the case of a

multiemployer plan.

(2) If the contributing sponsor of any singleemployer plan is a member of a controlled

group, each member of such group shall be jointly and severally liable for any premiums required to be paid by such contributing sponsor.

For purposes of the preceding sentence, the term

‘‘controlled group’’ means any group treated as

a single employer under subsection (b), (c), (m),

or (o) of section 414 of title 26.

(Pub. L. 93–406, title IV, §4007, Sept. 2, 1974, 88

Stat. 1013; Pub. L. 96–364, title IV, §§402(a)(3),

403(b), Sept. 26, 1980, 94 Stat. 1298, 1300; Pub. L.

100–203, title IX, §9331(c), Dec. 22, 1987, 101 Stat.

1330–368; Pub. L. 101–239, title VII, §7891(a)(1),

Dec. 19, 1989, 103 Stat. 2445.)

AMENDMENTS

1989—Subsec. (b). Pub. L. 101–239 substituted ‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue Code

of 1954’’, which for purposes of codification was translated as ‘‘title 26’’ thus requiring no change in text.

1987—Subsecs. (a) to (d). Pub. L. 100–203, §9331(c)(1),

substituted ‘‘designated payor’’ for ‘‘plan administrator’’ wherever appearing.

Subsec. (e). Pub. L. 100–203, §9331(c)(2), added subsec.

(e).

1980—Subsec. (a). Pub. L. 96–364 inserted provisions

relating to waiver or reduction of premiums, and

struck out provisions relating to payment of premiums

under statutory requirements respecting contingent liability coverage.

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by Pub. L. 101–239 effective, except as

otherwise provided, as if included in the provision of

the Tax Reform Act of 1986, Pub. L. 99–514, to which

such amendment relates, see section 7891(f) of Pub. L.

101–239, set out as a note under section 1002 of this title.

EFFECTIVE DATE OF 1987 AMENDMENT

Amendment by Pub. L. 100–203 applicable to plan

years beginning after Dec. 31, 1987, see section 9331(f)(1)

of Pub. L. 100–203, set out as a note under section 1305

of this title.

EFFECTIVE DATE OF 1980 AMENDMENT

Amendment by Pub. L. 96–364 effective Sept. 26, 1980,

except as specifically provided, see section 1461(e) of

this title.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in section 1303 of this title.