II 

111TH CONGRESS 

1ST SESSION S. 1544 

To amend the Employee Retirement Income Security Act of 1974 with respect 

to the composition of the board of directors of the Pension Benefit 

Guaranty Corporation, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JULY 30, 2009 

Mr. KOHL (for himself, Mr. BENNET, Mrs. MCCASKILL, and Mr. FEINGOLD) 

introduced the following bill; which was read twice and referred to the 

Committee on Health, Education, Labor, and Pensions 

A BILL 

To amend the Employee Retirement Income Security Act 

of 1974 with respect to the composition of the board 

of directors of the Pension Benefit Guaranty Corporation, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Pension Benefit Guar5 anty Corporation Governance Improvement Act of 2009’’. 


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1 SEC. 2. BOARD OF DIRECTORS OF THE PENSION BENEFIT 

2 GUARANTY CORPORATION. 

3 (a) IN GENERAL.—Section 4002(d) of the Employee 

4 Retirement Income Security Act of 1974 (29 U.S.C. 

5 1302(d)) is amended to read as follows: 

6 ‘‘(d)(1) The board of directors of the corporation con7 sists of— 

8 ‘‘(A) the Secretary of the Treasury, the Sec9 retary of Labor, and the Secretary of Commerce; 

10 ‘‘(B) a member that is a representative of em11 ployers offering defined benefit plans; 

12 ‘‘(C) a member that is a representative of orga13 nized labor and employees; and 

14 ‘‘(D) 2 other members. 

15 ‘‘(2)(A) The members of the board of directors de16 scribed under subparagraphs (B) through (D) of para17 graph (1)— 

18 ‘‘(i) shall be appointed by the President by 

19 and with the advice and consent of the Sen20 ate— 

21 ‘‘(I) at the beginning of the second 

22 year of the President’s term of office, with 

23 respect to such members described under 

24 subparagraphs (B) and (C) of paragraph 

25 (1); and 


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1 ‘‘(II) at the beginning of the fourth 

2 year of the President’s term of office, with 

3 respect to such members described under 

4 subparagraph (D) of paragraph (1); and 

5 ‘‘(ii) shall serve for a term of 4 years. 

6 ‘‘(B) Not more than 2 members of the board of 

7 directors described under subparagraphs (B) 

8 through (D) of paragraph (1) shall be affiliated with 

9 the same political party. 

10 ‘‘(C) Each member of the board of directors de11 scribed under subparagraphs (B) through (D) of 

12 paragraph (1) shall not have a direct financial inter13 est in the decisions of the corporation. 

14 ‘‘(3) Each member of the board of directors described 

15 under subparagraph (A) of paragraph (1) shall designate 

16 in writing an official, not below the level of Assistant Sec17 retary, to serve as the voting representative of such mem18 ber on the board. Such designation shall be effective until 

19 revoked or until a date or event specified therein. Any such 

20 representative may refer for board action any matter 

21 under consideration by the designating board member. 

22 ‘‘(4) The members of the board of directors described 

23 under— 

24 ‘‘(A) subparagraph (A) of paragraph (1), shall 

25 serve without compensation, but shall be reimbursed 


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1 for travel, subsistence, and other necessary expenses 

2 incurred in the performance of their duties as mem3 bers of the board; and 

4 ‘‘(B) subparagraphs (B) through (D) of para5 graph (1) shall, for each day (including traveltime) 

6 during which they are attending meetings or con7 ferences of the board or otherwise engaged in the 

8 business of the board, be compensated at a rate 

9 fixed by the corporation which is not in excess of the 

10 daily equivalent of the annual rate of basic pay in 

11 effect for grade GS–18 of the General Schedule, and 

12 while away from their homes or regular places of 

13 business they may be allowed travel expenses, in14 cluding per diem in lieu of subsistence, as authorized 

15 by section 5703 of title 5, United States Code. 

16 ‘‘(5)(A) The Secretary of Labor is the chairman of 

17 the board of directors. 

18 ‘‘(B) The President shall designate 1 of the members 

19 appointed under paragraph (2) as the vice-chairman of the 

20 board of directors. 

21 ‘‘(6) The Inspector General of the corporation shall 

22 report to the board of directors, and not less than twice 

23 a year, shall attend a meeting of the board of directors 

24 to provide a report on the activities and findings of the 


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1 Inspector General, including with respect to monitoring 

2 and review of the operations of the corporation. 

3 ‘‘(7) The General Counsel of the corporation shall— 

4 ‘‘(A) serve as the secretary to the board of di5 rectors, and shall advise such board as needed; and 

6 ‘‘(B) have overall responsibility for all legal 

7 matters affecting the corporation and provide the 

8 corporation with legal advice and opinions on all 

9 matters of law affecting the corporation, except that 

10 the authority of the General Counsel shall not ex11 tend to the Office of Inspector General and the inde12 pendent legal counsel of such Office. 

13 ‘‘(8) Notwithstanding any other provision of this Act, 

14 the Office of Inspector General and the legal counsel of 

15 such Office is independent of the management of the cor16 poration and the General Counsel of the corporation.’’. 

17 (b) NUMBER OF MEETINGS; PUBLIC AVAIL18 ABILITY.—Section 4002(e) of the Employee Retirement 

19 Income Security Act of 1974 (29 U.S.C. 1302(e)) is 

20 amended— 

21 (1) by striking ‘‘The board’’ and inserting ‘‘(1) 

22 The board’’; 

23 (2) by striking ‘‘the corporation.’’ and inserting 

24 ‘‘the corporation, but in no case less than 4 times 

25 a year with a quorum of not less than 5 members. 


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1 Not less than 1 meeting of the board of directors 

2 during each year shall be a joint meeting with the 

3 advisory committee under subsection (h).’’; and 

4 (3) by adding at the end the following: 

5 ‘‘(2) The chairman of the board of directors shall 

6 make available to the public the minutes from each meet7 ing of the board, unless the chairman designates a meeting 

8 or portion of a meeting as closed to the public, based on 

9 the confidentiality of the matters to be discussed during 

10 such meeting.’’. 

11 (c) ADVISORY COMMITTEE.— 

12 (1) ISSUES CONSIDERED BY THE COM13 MITTEE.—Section 4002(h)(1) of the Employee Re14 tirement Income Security Act of 1974 (29 U.S.C. 

15 1302(h)(1)) is amended— 

16 (A) by striking ‘‘, and (D)’’ and inserting 

17 ‘‘, (D)’’; and 

18 (B) by striking ‘‘time to time.’’ and insert19 ing ‘‘time to time, and (E) other issues as de20 termined appropriate by the advisory com21 mittee.’’. 

22 (2) JOINT MEETING.—Section 4002(h)(3) of 

23 the Employee Retirement Income Security Act of 

24 1974 (29 U.S.C. 1302(h)(3)) is amended by adding 

25 at the end the following: ‘‘Not less than 1 meeting 


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1 of the advisory committee during each year shall be 

2 a joint meeting with the board of directors under 

3 subsection (e).’’. 

4 SEC. 3. AVOIDING CONFLICTS OF INTEREST. 

5 Section 4002 of the Employee Retirement Income Se6 curity Act of 1974 (29 U.S.C. 1302) is amended by adding 

7 at the end the following: 

8 ‘‘(j) The Director of the corporation, and each mem9 ber of the board of directors described under subpara10 graphs (B) through (D) of subsection (d)(1), shall agree 

11 in writing to recuse him or herself from participation in 

12 activities which present a potential conflict of interest or 

13 appearance of such conflict, including by not serving on 

14 a technical evaluation panel.’’. 

15 SEC. 4. SENSE OF CONGRESS. 

16 (a) FORMATION OF COMMITTEES.—It is the sense of 

17 Congress that the board of directors of the Pension Ben18 efit Guaranty Corporation established under section 4002 

19 of the Employee Retirement Income Security Act of 1974 

20 (29 U.S.C. 1302), as amended by this Act, should form 

21 committees, including an audit committee and an invest22 ment committee, to enhance the overall effectiveness of the 

23 board of directors. 

24 (b) RISK MANAGEMENT POSITION.—It is the sense 

25 of Congress that the Pension Benefit Guaranty CorporaVerDate Nov 24 2008 08:25 Jul 31, 2009 Jkt 079200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1544.IS S1544

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1 tion established under section 4002 of the Employee Re2 tirement Income Security Act of 1974 (29 U.S.C. 1302), 

3 as amended by this Act, should establish a risk manage4 ment position that evaluates and mitigates the risk that 

5 the corporation might experience. The individual in such 

6 position should coordinate the risk management efforts of 

7 the corporation, explain risks and controls to senior man8 agement and the board of directors of the corporation, and 

9 make recommendations. 

Æ 


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