II

106TH CONGRESS

2D SESSION S. 2922

To create a Pension Reform and Simplification Commission to evaluate and

suggest ways to enhance access to the private pension plan system.

IN THE SENATE OF THE UNITED STATES

JULY 26, 2000

Mr. BINGAMAN introduced the following bill; which was read twice and

referred to the Committee on Health, Education, Labor, and Pensions

A BILL

To create a Pension Reform and Simplification Commission

to evaluate and suggest ways to enhance access to the

private pension plan system.

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 Reform and

5 Simplification Commission Act’’.

6 SEC. 2. FINDINGS.

7 Congress makes the following findings:

8 (1) The creation and implementation of an af9 fordable, accessible, equitable, efficient, cost-effec10 tive, and easy to understand system is essential to
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1 the continuity and viability of the current private

2 pension plan system in the United States.

3 (2) There is a near universal recognition in the

4 United States that the laws that regulate our pen5 sion system have become unwieldy, complex, and

6 burdensome, a condition that hinders the achieve7 ment of increased saving and economic growth and

8 cannot be fixed by ad hoc improvements to ERISA

9 and the Internal Revenue Code of 1986.

10 (3) Significant and effective improvement of

11 laws can only be accomplished through a coordi12 nated, comprehensive, and sustained effort to revise

13 and simplify current laws by a high-level body of

14 pension experts, whose recommendations are then

15 transmitted to Congress.

16 (4) In recent years, the adoption of narrowly fo17 cused and increasingly complex statutes through

18 amendment of the Employee Retirement Income Se19 curity Act of 1974 (in this Act referred to as

20 ‘‘ERISA’’) and the Internal Revenue Code of 1986

21 has impeded the efforts of employers and employees

22 to save for their retirement and imposed significant

23 challenges for businesses which consider establishing

24 pension plans for their workforce.
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1 (5) A high national savings rate can contribute

2 significantly to the economic security of the Nation

3 as it adds to available investment capital, fuels eco4 nomic growth, and enhances productivity, competi5 tiveness, and prosperity.

6 (6) The Federal Government can potentially in7 crease the national savings rate through the imple8 mentation of policies that create an effective frame9 work for the spread of voluntary retirement plans

10 and the protection of the private assets held in those

11 plans.

12 (7) Private pension plans have been, and re13 main, the single largest repository of private capital

14 in the world and potentially act as a significant in15 ducement for personal saving and investment.

16 (8) Pensions represent the only hope that most

17 working Americans have an adequate supplement to

18 social security benefits, and while the private pen19 sion system has been greatly improved since the es20 tablishment of ERISA, many inequities remain, and

21 many workers are still not covered by the system.

22 (9) It is essential that all Americans, no matter

23 what their income security level, have the oppor24 tunity to achieve income security in their retirement

25 years. Currently, many tax and retirement incentives
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1 for private pension plans, while benefiting higher in2 come employees who can often save adequately for

3 their retirement, do not serve sufficiently the needs

4 of low and moderate income workers.

5 (10) The current pensions rules have tended to

6 produce disparate coverage rates for low and mod7 erate income workers.

8 (11) The failure of the Government to modify

9 current pension policies will mean that many work10 ers will be deprived of the options needed to save for

11 their retirement and will, consequently, have their

12 retirement expectations minimized or eliminated.

13 (12) The failure of the Government to redress

14 the burdens imposed by over-regulation and com15 plexity on employer-sponsored pension plans will

16 harm employees and their families.

17 (13) The failure of the Government to redress

18 the problems related to private pension plans may

19 erode the ability of United States companies to com20 pete effectively in the international market and re21 sult in a decrease in the economic health of the Na22 tion.
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1 SEC. 3. ESTABLISHMENT OF COMMISSION.

2 There is established a commission to be known as the

3 Pension Reform and Simplification Commission (in this

4 Act referred to as the ‘‘Commission’’).

5 SEC. 4. DUTIES.

6 (a) IN GENERAL.—The Commission shall—

7 (1) study the strengths, weaknesses, and chal8 lenges involved in the regulation of the current pri9 vate pension system;

10 (2) review and assess Federal statutes relating

11 to the regulation of the current private pension sys12 tem; and

13 (3) recommend changes in the law regarding

14 the regulation of the current private pension system

15 to mitigate the problems identified under subsection

16 (b), with the goal of making the system more afford17 able, accessible, efficient, less costly, less complex,

18 and, in general, to expand pension coverage.

19 (b) ISSUES TO BE STUDIED.—The Commission shall

20 include in the study under subsection (a) a consideration

21 of—

22 (1) the manner in which the current rules im23 pact private pension coverage, how such coverage

24 has changed over the last 25 years (since the enact25 ment of ERISA), and reasons for such change;
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1 (2) the primary burdens placed on small and

2 medium business in the United States regarding ad3 ministration of pension plans, especially how such

4 burdens affect the tenuous position occupied by

5 these organizations in the competitive market;

6 (3) the simplification of existing pension rules

7 in order to eliminate undue costs on employers while

8 providing retirement security protection to employ9 ees;

10 (4) the primary obstacles to employees in gain11 ing optimum advantages from the current pension

12 system, with particular attention to the small and

13 medium business sector and low and moderate in14 come employees, including minorities and women;

15 (5) the feasibility of providing innovative design

16 options to enable small and medium businesses to be

17 relieved of complex and costly legislative and regu18 latory burdens in matters of adoption, operation, ad19 ministration, and reporting of pension plans, in

20 order to increase affordable and effective coverage in

21 that sector, for low and moderate income employees,

22 with emphasis on minorities and women;

23 (6) the means of leveling distribution of private

24 pension plan coverage between high wage earners

25 and low and moderate income workers;
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1 (7) the feasibility of forward-looking reforms

2 that anticipate the needs of small and medium busi3 nesses in the United States given the obstacles and

4 opportunities of the new global economy, in par5 ticular issues related to the mobility and retention of

6 skilled workers;

7 (8) how pension plan benefits can be made

8 more portable;

9 (9) the means of achieving the expansion and

10 adoption of pension plans by United States busi11 nesses, especially those employing low and moderate

12 income workers who currently lack access to such

13 plans;

14 (10) the impact of expanding individual retire15 ment account contribution limits and income limits

16 on private pension plan coverage;

17 (11) the provision of innovative incentives that

18 encourage more employers to use existing private

19 pension plans;

20 (12) the impact of qualified plan contribution

21 and benefit limits on coverage; and

22 (13) any proposals for major simplification of

23 Federal legislation and regulation regarding quali24 fied pension plans, in order to address and mitigate
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1 problem areas identified under this subsection, with

2 the goal of—

3 (A) strengthening the private pension sys4 tem;

5 (B) expanding the availability, adoption,

6 and retention of tax-favored savings plans by all

7 Americans;

8 (C) eliminating rules that burden the pen9 sion system beyond the benefits they provide,

10 for low and moderate income workers, including

11 minorities and women, with specific emphasis

12 on—

13 (i) eligibility and coverage;

14 (ii) contributions and benefits;

15 (iii) minimum distributions, with16 drawals, and loans;

17 (iv) spousal and beneficiary benefits;

18 (v) portability between plans;

19 (vi) asset recapture;

20 (vii) plan compliance and termination;

21 (viii) income and excise taxation; and

22 (ix) reporting, disclosure, and pen23 alties; and

24 (D) identification of the trade-offs involved

25 in simplification under subparagraph (C).
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1 (c) REPORT.—

2 (1) IN GENERAL.—Not later than 24 months

3 after the designation of the chairperson under sec4 tion 5(d), the Commission shall transmit to the

5 President and Congress a report containing—

6 (A) the issues studied under subsection

7 (b);

8 (B) the results of such study;

9 (C) draft legislation and commentary

10 under paragraph (2); and

11 (D) any other recommendations based on

12 such study.

13 (2) LEGISLATIVE RECOMMENDATIONS.—The

14 Commission shall develop draft legislation and asso15 ciated explanations and commentary to achieve

16 major simplification of Federal legislation regarding

17 regulation of pension plans (including ERISA and

18 the Internal Revenue Code of 1986) to implement

19 any findings or recommendations of the study con20 ducted under subsection (b).

21 (3) RECOMMENDATIONS.—Any official findings

22 or recommendations of the Commission shall be

adopted by 2 23 ⁄3 of the members of the Commission.

24 (4) MINORITY VIEWS.—All findings and rec25 ommendations of the Commission formally proposed
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1 by any member of the Commission and not adopted

2 under paragraph (3) shall also be included in the re3 port.

4 SEC. 5. MEMBERSHIP OF THE COMMISSION; RULES; POW5 ERS.

6 (a) COMPOSITION.—

7 (1) NUMBER.—The Commission shall be com8 posed of 15 members, appointed not later than 45

9 days after the date of enactment of this Act.

10 (2) APPOINTMENTS.—The membership of the

11 Commission shall be as follows:

12 (A) 3 individuals appointed by the Presi13 dent, after consultation with the Secretary of

14 Labor and the Secretary of the Treasury, or

15 their respective designees.

16 (B) 3 individuals appointed by the major17 ity leader of the Senate.

18 (C) 3 individuals appointed by the minority

19 leader of the Senate.

20 (D) 3 individuals appointed by the Speaker

21 of the House of Representatives.

22 (E) 3 individuals appointed by the minor23 ity leader of the House of Representatives.

24 (b) QUALIFICATIONS OF MEMBERS.—
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1 (1) IN GENERAL.—Individuals appointed under

2 subsection (a)(2) shall be individuals who—

3 (A) have experience in actuarial disciplines,

4 law, economics, public policy, human relations,

5 business, manufacturing, labor, multiemployer

6 pension plan administration, single employer

7 pension plan administration, or academia, or

8 have other distinctive and pertinent qualifica9 tions or experience in retirement policy;

10 (B) are not officers or employees of the

11 United States; and

12 (C) are selected without regard to political

13 affiliation or past partisan activity.

14 (2) OTHER CONSIDERATIONS.—In the appoint15 ment of members under subsection (a), every effort

16 shall be made to ensure that the individuals, as a

17 group—

18 (A) are representatives of a broad cross19 section of perspectives on private pension plans

20 within the United States;

21 (B) have the capacity to provide significant

22 analytical insight into existing obstacles and op23 portunities of private pension plans; and

24 (C) represent all of the areas of experience

25 under paragraph (1)(A).
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1 (c) TERMS; VACANCIES.—

2 (1) TERMS.—Each member shall be appointed

3 for the life of the Commission.

4 (2) VACANCIES.—Any vacancy in the Commis5 sion shall not affect its powers and shall be filled in

6 the same manner as the appointment of the member

7 causing the vacancy.

8 (d) CHAIRPERSON; VICE CHAIRPERSON.—Not later

9 than 60 days after the date of enactment of this Act, the

10 President shall designate a chairperson and vice chair11 person of the Commission from the individuals appointed

12 under subsection (a)(2).

13 (e) COMPENSATION.—

14 (1) PROHIBITION OF PAY.—Except as provided

15 in subparagraph (B), members of the Commission

16 shall serve without pay.

17 (2) TRAVEL EXPENSES.—Each member of the

18 Commission may receive travel expenses, including

19 per diem in lieu of subsistence, in accordance with

20 sections 5702 and 5703 of title 5, United States

21 Code, while away from their homes or regular place

22 of business in the performance of services for the

23 Commission.

24 (f) RULES OF THE COMMISSION.—
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1 (1) QUORUM.—Eight members of the Commis2 sion shall constitute a quorum for conducting the

3 business of the Commission, except 5 members of

4 the Commission may hold hearings, take testimony,

5 or receive evidence.

6 (2) NOTICE.—Any meetings held by the Com7 mission shall be duly noticed in the Federal Register

8 at least 14 days prior to such meeting and shall be

9 open to the public.

10 (3) OPPORTUNITIES TO TESTIFY.—The Com11 mission shall provide opportunities for representa12 tives of the general public, taxpayer groups, con13 sumer groups, think tanks, and State and local gov14 ernment officials to testify.

15 (4) MEETINGS.—The Commission shall meet at

16 the call of the chairperson of the Commission.

17 (5) OTHER RULES.—The Commission shall

18 adopt such other rules as necessary.

19 (g) POWERS OF THE COMMISSION.—

20 (1) INFORMATION FROM FEDERAL AGENCIES.—

21 (A) IN GENERAL.—The Commission may

22 secure directly from any Federal department or

23 agency such materials, resources, data, and

24 other information as the Commission considers

25 necessary to carry out the provisions of this
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1 section. Upon request of the chairperson of the

2 Commission, the head of such department or

3 agency shall furnish such materials, resources,

4 data, and other information to the Commission.

5 (B) COORDINATION OF RESEARCH INFOR6 MATION.—The Commission shall ensure effec7 tive use of such materials, resources, data, and

8 other information and avoid duplicative re9 search by coordinating and consulting with the

10 head of the appropriate research department

11 of—

12 (i) the Pension and Welfare Benefits

13 Administration of the Department of

14 Labor;

15 (ii) the Department of the Treasury;

16 (iii) the Social Security Administra17 tion;

18 (iv) the Small Business Administra19 tion;

20 (v) the Pension Benefit Guaranty

21 Corporation;

22 (vi) the National Institute on Aging;

23 and

24 (vii) private organizations which have

25 conducted research in the pension area.
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1 (2) MAILS.—The Commission may use the

2 United States mails in the same manner and under

3 the same conditions as any other Federal agency.

4 (3) ACCEPTANCE OF SERVICES; GIFTS; AND

5 GRANTS.—The Commission may accept, use, and

6 dispose of gifts or grants of services or property,

7 both real and personal, for purposes of aiding or fa8 cilitating the work of the Commission. Gifts or

9 grants not used at the expiration of the Commission

10 shall be returned to the donor or grantor.

11 (4) CONTRACT AND PROCUREMENT AUTHOR12 ITY.—The Commission may make purchases, and

13 may contract with and compensate government and

14 private agencies or persons for property or services,

15 without regard to—

16 (A) section 3709 of the Revised Statutes

17 (41 U.S.C. 5); and

18 (B) title III of the Federal Property and

19 Administrative Services Act of 1949 (41 U.S.C.

20 251 et seq.).

21 (5) VOLUNTEER SERVICES.—Notwithstanding

22 section 1342 of title 31, United States Code, the

23 Commission may accept and use voluntary and un24 compensated services as the Commission determines

25 necessary.
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1 SEC. 6. STAFF AND SUPPORT SERVICES.

2 (a) EXECUTIVE DIRECTOR; STAFF.—

3 (1) IN GENERAL.—The chairperson of the Com4 mission may, without regard to civil service laws and

5 regulations and after consultation with the Commis6 sion, appoint an executive director of the Commis7 sion and such other additional personnel as may be

8 necessary to enable the Commission to perform its

9 duties.

10 (2) COMPENSATION.—The chairperson of the

11 Commission may fix the compensation of the execu12 tive director and other personnel without regard to

13 the provisions of chapter 51 and subchapter III of

14 chapter 53 of title 5, United States Code, relating

15 to classification of positions and General Schedule

16 pay rates, except that the rate of pay for the execu17 tive director and other personnel may not exceed the

18 rate payable for level IV of the Executive Schedule

19 under section 5315 of such title.

20 (b) STAFF OF FEDERAL AGENCIES.—Upon request

21 by the chairperson of the Commission, the head of any

22 Federal department or agency may detail, on a non23 reimbursable basis, any of the personnel of the department

24 or agency to the Commission to assist the Commission to

25 carry out its duties under this Act and such detail shall
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1 be without interruption or loss of civil service status or

2 privilege.

3 (c) ADMINISTRATIVE SUPPORT SERVICES.—The Ad4 ministrator of General Services shall provide to the Com5 mission, on a reimbursable basis, any administrative sup6 port services that are necessary to enable the Commission

7 to carry out this Act.

8 SEC. 7. TERMINATION.

9 The Commission shall terminate not later than 26

10 months after the date of enactment of this Act.

11 SEC. 8. AUTHORIZATION OF APPROPRIATIONS.

12 There are authorized to be appropriated such sums

13 as may be necessary to carry out the provisions of this

14 Act.

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