II 

116TH CONGRESS 

1ST SESSION S. 2254 

To amend the Internal Revenue Code of 1986 to create a Pension Rehabilitation Trust Fund, to establish a Pension Rehabilitation Administration 

within the Department of the Treasury to make loans to multiemployer 

defined benefit plans, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JULY 24, 2019 

Mr. BROWN (for himself, Ms. BALDWIN, Mr. BLUMENTHAL, Mr. BOOKER, Mr. 

CASEY, Ms. DUCKWORTH, Mr. DURBIN, Ms. HARRIS, Ms. HASSAN, Mr. 

HEINRICH, Ms. HIRONO, Mr. JONES, Mr. KAINE, Ms. KLOBUCHAR, Mr. 

MANCHIN, Mr. MARKEY, Mr. MERKLEY, Mr. PETERS, Ms. ROSEN, Mr. 

SANDERS, Mr. SCHUMER, Mrs. SHAHEEN, Ms. SMITH, Ms. STABENOW, 

Mr. VAN HOLLEN, Ms. WARREN, and Mr. WHITEHOUSE) introduced the 

following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to create 

a Pension Rehabilitation Trust Fund, to establish a Pension Rehabilitation Administration within the Department of the Treasury to make loans to multiemployer 

defined benefit plans, 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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Butch Lewis Act of 

3 2019’’. 

4 SEC. 2. PENSION REHABILITATION ADMINISTRATION; ES5 TABLISHMENT; POWERS. 

6 (a) ESTABLISHMENT.—There is established in the 

7 Department of the Treasury an agency to be known as 

8 the ‘‘Pension Rehabilitation Administration’’. 

9 (b) DIRECTOR.— 

10 (1) ESTABLISHMENT OF POSITION.—There 

11 shall be at the head of the Pension Rehabilitation 

12 Administration a Director, who shall be appointed 

13 by the President. 

14 (2) TERM.— 

15 (A) IN GENERAL.—The term of office of 

16 the Director shall be 5 years. 

17 (B) SERVICE UNTIL APPOINTMENT OF

18 SUCCESSOR.—An individual serving as Director 

19 at the expiration of a term may continue to 

20 serve until a successor is appointed. 

21 (3) POWERS.— 

22 (A) APPOINTMENT OF DEPUTY DIREC23 TORS, OFFICERS, AND EMPLOYEES.—The Di24 rector may appoint Deputy Directors, officers, 

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1 ance with chapter 51 and subchapter III of 

2 chapter 53 of title 5, United States Code. 

3 (B) CONTRACTING.— 

4 (i) IN GENERAL.—The Director may 

5 contract for financial and administrative 

6 services (including those related to budget 

7 and accounting, financial reporting, per8 sonnel, and procurement) with the General 

9 Services Administration, or such other 

10 Federal agency as the Director determines 

11 appropriate, for which payment shall be 

12 made in advance, or by reimbursement, 

13 from funds of the Pension Rehabilitation 

14 Administration in such amounts as may be 

15 agreed upon by the Director and the head 

16 of the Federal agency providing the serv17 ices. 

18 (ii) SUBJECT TO APPROPRIATIONS.— 

19 Contract authority under clause (i) shall be 

20 effective for any fiscal year only to the ex21 tent that appropriations are available for 

22 that purpose. 

23 (c) TRANSFER OF FUNDS.—The Secretary of the 

24 Treasury may transfer for any fiscal year, from unobli25 gated amounts appropriated to the Department of the 


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1 Treasury, to the Pension Rehabilitation Administration 

2 such sums as may be reasonably necessary for the admin3 istrative and operating expenses of the Pension Rehabilita4 tion Administration. 

5 SEC. 3. PENSION REHABILITATION TRUST FUND. 

6 (a) IN GENERAL.—Subchapter A of chapter 98 of the 

7 Internal Revenue Code of 1986 is amended by adding at 

8 the end the following new section: 

9 ‘‘SEC. 9512. PENSION REHABILITATION TRUST FUND. 

10 ‘‘(a) CREATION OF TRUST FUND.—There is estab11 lished in the Treasury of the United States a trust fund 

12 to be known as the ‘Pension Rehabilitation Trust Fund’ 

13 (hereafter in this section referred to as the ‘Fund’), con14 sisting of such amounts as may be appropriated or cred15 ited to the Fund as provided in this section and section 

16 9602(b). 

17 ‘‘(b) TRANSFERS TO FUND.— 

18 ‘‘(1) AMOUNTS ATTRIBUTABLE TO TREASURY

19 BONDS.—There shall be credited to the Fund the 

20 amounts transferred under section 6 of the Butch 

21 Lewis Act of 2019. 

22 ‘‘(2) LOAN INTEREST AND PRINCIPAL.— 

23 ‘‘(A) IN GENERAL.—The Director of the 

24 Pension Rehabilitation Administration estab25 lished under section 2 of the Butch Lewis Act 


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1 of 2019 shall deposit in the Fund any amounts 

2 received from a plan as payment of interest or 

3 principal on a loan under section 4 of such Act. 

4 ‘‘(B) INTEREST.—For purposes of sub5 paragraph (A), the term ‘interest’ includes 

6 points and other similar amounts. 

7 ‘‘(3) TRANSFERS FROM SECRETARY.—The Di8 rector of the Pension Rehabilitation Administration 

9 shall deposit in the Fund any amounts received from 

10 the Secretary under section 2(c) of such Act. 

11 ‘‘(4) AVAILABILITY OF FUNDS.—Amounts cred12 ited to or deposited in the Fund shall remain avail13 able until expended. 

14 ‘‘(c) EXPENDITURES FROM FUND.—Amounts in the 

15 Fund are available without further appropriation to the 

16 Pension Rehabilitation Administration— 

17 ‘‘(1) for the purpose of making the loans de18 scribed in section 4 of the Butch Lewis Act of 2019, 

19 ‘‘(2) for the payment of principal and interest 

20 on obligations issued under section 6 of such Act, 

21 and 

22 ‘‘(3) for administrative and operating expenses 

23 of such Administration.’’. 

24 (b) CLERICAL AMENDMENT.—The table of sections 

25 for subchapter A of chapter 98 of the Internal Revenue 


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1 Code of 1986 is amended by adding at the end the fol2 lowing new item: 

‘‘Sec. 9512. Pension Rehabilitation Trust Fund.’’. 

3 SEC. 4. LOAN PROGRAM FOR MULTIEMPLOYER DEFINED 

4 BENEFIT PLANS. 

5 (a) LOAN AUTHORITY.— 

6 (1) IN GENERAL.—The Pension Rehabilitation 

7 Administration established under section 2 is au8 thorized— 

9 (A) to make loans to multiemployer plans 

10 (as defined in section 414(f) of the Internal 

11 Revenue Code of 1986) which are defined ben12 efit plans (as defined in section 414(j) of such 

13 Code) and which— 

14 (i) are in critical and declining status 

15 (within the meaning of section 432(b)(6) 

16 of such Code and section 305(b)(6) of such 

17 Act) as of the date of the enactment of 

18 this Act, or with respect to which a sus19 pension of benefits has been approved 

20 under section 432(e)(9) of such Code and 

21 section 305(e)(9) of such Act as of such 

22 date; 

23 (ii) as of such date of enactment, are 

24 in critical status (within the meaning of 

25 section 432(b)(2) of such Code and section 


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1 305(b)(2) of such Act), have a funded per2 centage of less than 40 percent (as deter3 mined for purposes of section 432 of such 

4 Code and section 305 of such Act), and 

5 have a ratio of active to inactive partici6 pants which is less than 2 to 3; or 

7 (iii) are insolvent for purposes of sec8 tion 418E of such Code as of such date of 

9 enactment, if they became insolvent after 

10 December 16, 2014, and have not been 

11 terminated; and 

12 (B) subject to subsection (b), to establish 

13 appropriate terms for such loans. 

14 (2) CONSULTATION.—The Director of the Pen15 sion Rehabilitation Administration shall consult with 

16 the Secretary of the Treasury, the Secretary of 

17 Labor, and the Director of the Pension Benefit 

18 Guaranty Corporation before making any loan under 

19 paragraph (1), and shall share with such persons the 

20 application and plan information with respect to 

21 each such loan. 

22 (3) ESTABLISHMENT OF LOAN PROGRAM.— 

23 (A) IN GENERAL.—A program to make the 

24 loans authorized under this section shall be es25 tablished not later than September 30, 2019, 


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1 with guidance regarding such program to be 

2 promulgated by the Director of the Pension Re3 habilitation Administration, in consultation with 

4 the Pension Benefit Guaranty Corporation and 

5 the Department of Labor, not later than De6 cember 31, 2019. 

7 (B) LOANS AUTHORIZED BEFORE PRO8 GRAM DATE.—Without regard to whether the 

9 program under subparagraph (A) has been es10 tablished, a plan may apply for a loan under 

11 this section before either date described in such 

12 subparagraph, and the Pension Rehabilitation 

13 Administration shall approve the application 

14 and make the loan before establishment of the 

15 program if necessary to avoid any suspension of 

16 the accrued benefits of participants. 

17 (b) LOAN TERMS.— 

18 (1) IN GENERAL.—The terms of any loan made 

19 under subsection (a) shall state that— 

20 (A) the plan shall make payments of inter21 est on the loan for a period of 29 years begin22 ning on the date of the loan (or 19 years in the 

23 case of a plan making the election under sub24 section (c)(5)); 


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1 (B) final payment of interest and principal 

2 shall be due in the 30th year after the date of 

3 the loan (except as provided in an election 

4 under subsection (c)(5)); and 

5 (C) as a condition of the loan, the plan 

6 sponsor stipulates that— 

7 (i) except as provided in clause (ii), 

8 the plan will not increase benefits, allow 

9 any employer participating in the plan to 

10 reduce its contributions, or accept any col11 lective bargaining agreement which pro12 vides for reduced contribution rates, dur13 ing the 30-year period described in sub14 paragraphs (A) and (B); 

15 (ii) in the case of a plan with respect 

16 to which a suspension of benefits has been 

17 approved under section 432(e)(9) of the 

18 Internal Revenue Code of 1986 and section 

19 305(e)(9) of the Employee Retirement In20 come Security Act of 1974, or under sec21 tion 418E of such Code, before the loan, 

22 the plan will reinstate the suspended bene23 fits (or will not carry out any suspension 

24 which has been approved but not yet im25 plemented); 


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1 (iii) the plan sponsor will comply with 

2 the requirements of section 6059A of the 

3 Internal Revenue Code of 1986; 

4 (iv) the plan will continue to pay all 

5 premiums due under section 4007 of the 

6 Employee Retirement Income Security Act 

7 of 1974; and 

8 (v) the plan and plan administrator 

9 will meet such other requirements as the 

10 Director of the Pension Rehabilitation Ad11 ministration provides in the loan terms. 

12 The terms of the loan shall not make reference 

13 to whether the plan is receiving financial assist14 ance under section 4261(d) of the Employee 

15 Retirement Income Security Act of 1974 (29 

16 U.S.C. 1431(d)) or to any adjustment of the 

17 loan amount under subsection (d)(2)(A)(ii). 

18 (2) INTEREST RATE.—Except as provided in 

19 the second sentence of this paragraph and sub20 section (c)(5), loans made under subsection (a) shall 

21 have as low an interest rate as is feasible. Such rate 

22 shall be determined by the Pension Rehabilitation 

23 Administration and shall— 

24 (A) not be lower than the rate of interest 

25 on 30-year Treasury securities on the first day 


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1 of the calendar year in which the loan is issued; 

2 and 

3 (B) not exceed the greater of— 

4 (i) a rate .2 percent higher than such 

5 rate of interest on such date; or 

6 (ii) the rate necessary to collect reve7 nues sufficient to administer the program 

8 under this section. 

9 (c) LOAN APPLICATION.— 

10 (1) IN GENERAL.—In applying for a loan under 

11 subsection (a), the plan sponsor shall— 

12 (A) demonstrate that, except as provided 

13 in subparagraph (C)— 

14 (i) the loan will enable the plan to 

15 avoid insolvency for at least the 30-year 

16 period described in subparagraphs (A) and 

17 (B) of subsection (b)(1) or, in the case of 

18 a plan which is already insolvent, to 

19 emerge from insolvency within and avoid 

20 insolvency for the remainder of such pe21 riod; and 

22 (ii) the plan is reasonably expected to 

23 be able to pay benefits and the interest on 

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1 mulate sufficient funds to repay the prin2 cipal when due; 

3 (B) provide the plan’s most recently filed 

4 Form 5500 as of the date of application and 

5 any other information necessary to determine 

6 the loan amount under subsection (d); 

7 (C) stipulate whether the plan is also ap8 plying for financial assistance under section 

9 4261(d) of the Employee Retirement Income 

10 Security Act of 1974 (29 U.S.C. 1431(d)) in 

11 combination with the loan to enable the plan to 

12 avoid insolvency and to pay benefits, or is al13 ready receiving such financial assistance as a 

14 result of a previous application; 

15 (D) state in what manner the loan pro16 ceeds will be invested pursuant to subsection 

17 (d), the person from whom any annuity con18 tracts under such subsection will be purchased, 

19 and the person who will be the investment man20 ager for any portfolio implemented under such 

21 subsection; and 

22 (E) include such other information and 

23 certifications as the Director of the Pension Re24 habilitation Administration shall require. 


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1 (2) STANDARD FOR ACCEPTING ACTUARIAL AND

2 PLAN SPONSOR DETERMINATIONS AND DEMONSTRA3 TIONS IN THE APPLICATION.—In evaluating the plan 

4 sponsor’s application, the Director of the Pension 

5 Rehabilitation Administration shall accept the deter6 minations and demonstrations in the application un7 less the Director, in consultation with the Director 

8 of the Pension Benefit Guaranty Corporation and 

9 the Secretary of Labor, concludes that the deter10 minations and demonstrations in the application are 

11 unreasonable or are inconsistent with any rules 

12 issued by the Director pursuant to subsection (g). 

13 (3) REQUIRED ACTIONS; DEEMED APPROVAL.— 

14 The Director of the Pension Rehabilitation Adminis15 tration shall approve or deny any application under 

16 this subsection within 90 days after the submission 

17 of such application. An application shall be deemed 

18 approved unless, within such 90 days, the Director 

19 notifies the plan sponsor of the denial of such appli20 cation and the reasons for such denial. Any approval 

21 or denial of an application by the Director of the 

22 Pension Rehabilitation Administration shall be treat23 ed as a final agency action for purposes of section 

24 704 of title 5, United States Code. The Pension Re25 habilitation Administration shall make the loan purVerDate Sep 11 2014 00:49 Jul 31, 2019 Jkt 089200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S2254.IS S2254

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1 suant to any application promptly after the approval 

2 of such application. 

3 (4) CERTAIN PLANS REQUIRED TO APPLY.— 

4 The plan sponsor of any plan with respect to which 

5 a suspension of benefits has been approved under 

6 section 432(e)(9) of the Internal Revenue Code of 

7 1986 and section 305(e)(9) of the Employee Retire8 ment Income Security Act of 1974 or under section 

9 418E of such Code, before the date of the enactment 

10 of this Act shall apply for a loan under this section. 

11 The Director of the Pension Rehabilitation Adminis12 tration shall provide for such plan sponsors to use 

13 the simplified application under subsection 

14 (d)(2)(B). 

15 (5) INCENTIVE FOR EARLY REPAYMENT.—The 

16 plan sponsor may elect at the time of the application 

17 to repay the loan principal, along with the remaining 

18 interest, over the 10-year period beginning with the 

19 21st year after the date of the loan. In the case of 

20 a plan making this election, the interest on the loan 

21 shall be reduced by 0.5 percent. 

22 (d) LOAN AMOUNT AND USE.— 

23 (1) AMOUNT OF LOAN.— 

24 (A) IN GENERAL.—Except as provided in 

25 subparagraphs (B) and (C) and paragraph (2), 


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1 the amount of any loan under subsection (a) 

2 shall be, as demonstrated by the plan sponsor 

3 on the application under subsection (c), the 

4 amount needed to purchase annuity contracts 

5 or to implement a portfolio described in para6 graph (3)(C) (or a combination of the two) suf7 ficient to provide benefits of participants and 

8 beneficiaries of the plan in pay status, and ter9 minated vested benefits, at the time the loan is 

10 made. 

11 (B) LIMITATION BASED ON ABILITY TO

12 REPAY.—If at the time of the application under 

13 subsection (c) the plan sponsor determines that, 

14 based on a repayment schedule that would pro15 vide for repayment of the full amount deter16 mined under subparagraph (A) or (C)(ii) within 

17 the 30-year period described in subsection 

18 (b)(1), making payments would cause the plan 

19 to be within 18 months of becoming insolvent at 

20 any point during such period, the loan amount 

21 shall be such lesser amount as the plan sponsor 

22 determines the plan will be able to repay with23 out becoming within 18 months of insolvency. 

24 (C) PLANS WITH SUSPENDED BENEFITS.— 

25 In the case of a plan with respect to which a 


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1 suspended benefits has been approved under 

2 section 432(e)(9) of the Internal Revenue Code 

3 of 1986 and section 305(e)(9) of the Employee 

4 Retirement Income Security Act of 1974 (29 

5 U.S.C. 1085(e)(9)) or under section 418E of 

6 such Code— 

7 (i) the suspension of benefits shall not 

8 be taken into account in applying subpara9 graph (A); and 

10 (ii) except as provided in subpara11 graph (B), the loan amount shall be the 

12 amount sufficient to provide benefits of 

13 participants and beneficiaries of the plan 

14 in pay status and terminated vested bene15 fits at the time the loan is made, deter16 mined without regard to the suspension, 

17 including retroactive payment of benefits 

18 which would otherwise have been payable 

19 during the period of the suspension. 

20 (2) COORDINATION WITH PBGC FINANCIAL AS21 SISTANCE.— 

22 (A) IN GENERAL.—In the case of a plan 

23 which is also applying for financial assistance 

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1 ment Income Security Act of 1974 (29 U.S.C. 

2 1431(d))— 

3 (i) the plan sponsor shall submit the 

4 loan application and the application for fi5 nancial assistance jointly to the Pension 

6 Rehabilitation Administration and the Pen7 sion Benefit Guaranty Corporation with 

8 the information necessary to determine the 

9 eligibility for and amount of the loan under 

10 this section and the financial assistance 

11 under section 4261(d) of such Act; and 

12 (ii) if such financial assistance is 

13 granted, the amount of the loan under sub14 section (a) shall not exceed an amount 

15 equal to the excess of— 

16 (I) the amount determined under 

17 paragraph (1)(A) or (1)(C)(ii) (which18 ever is applicable), without regard to 

19 paragraph (1)(B); over 

20 (II) the amount of such financial 

21 assistance. 

22 (B) PLANS ALREADY RECEIVING PBGC AS23 SISTANCE.—The Director of the Pension Reha24 bilitation Administration shall provide for a 

25 simplified application for the loan under this 


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1 section which may be used by an insolvent plan 

2 which has not been terminated and which is al3 ready receiving financial assistance (other than 

4 under section 4261(d) of such Act) from the 

5 Pension Benefit Guaranty Corporation at the 

6 time of the application for the loan under this 

7 section. 

8 (3) USE OF LOAN FUNDS.— 

9 (A) IN GENERAL.—The loan received 

10 under subsection (a) shall be used to purchase 

11 annuity contracts which meet the requirements 

12 of subparagraph (B) or to implement a port13 folio described in subparagraph (C) (or a com14 bination of the two) to provide the benefits de15 scribed in paragraph (1). 

16 (B) ANNUITY CONTRACT REQUIRE17 MENTS.—The annuity contracts purchased 

18 under subparagraph (A) shall be issued by an 

19 insurance company which is licensed to do busi20 ness under the laws of any State and which is 

21 rated A or better by a nationally recognized sta22 tistical rating organization, and the purchase of 

23 such contracts shall meet all applicable fidu24 ciary standards under the Employee Retirement 

25 Income Security Act of 1974. 


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1 (C) PORTFOLIO.— 

2 (i) IN GENERAL.—A portfolio de3 scribed in this subparagraph is— 

4 (I) a cash matching portfolio or 

5 duration matching portfolio consisting 

6 of investment grade (as rated by a na7 tionally recognized statistical rating 

8 organization) fixed income invest9 ments, including United States dollar10 denominated public or private debt 

11 obligations issued or guaranteed by 

12 the United States or a foreign issuer, 

13 which are tradeable in United States 

14 currency and are issued at fixed or 

15 zero coupon rates; or 

16 (II) any other portfolio pre17 scribed by the Secretary of the Treas18 ury in regulations which has a similar 

19 risk profile to the portfolios described 

20 in subclause (I) and is equally protec21 tive of the interests of participants 

22 and beneficiaries. 

23 Once implemented, such a portfolio shall 

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1 pants and beneficiaries in pay status at the 

2 time of the loan are satisfied. 

3 (ii) FIDUCIARY DUTY.—Any invest4 ment manager of a portfolio under this 

5 subparagraph shall acknowledge in writing 

6 that such person is a fiduciary under the 

7 Employee Retirement Income Security Act 

8 of 1974 with respect to the plan. 

9 (iii) TREATMENT OF PARTICIPANTS

10 AND BENEFICIARIES.—Participants and 

11 beneficiaries covered by a portfolio under 

12 this subparagraph shall continue to be 

13 treated as participants and beneficiaries of 

14 the plan, including for purposes of title IV 

15 of the Employee Retirement Income Secu16 rity Act of 1974. 

17 (D) ACCOUNTING.— 

18 (i) IN GENERAL.—Annuity contracts 

19 purchased and portfolios implemented 

20 under this paragraph shall be used solely 

21 to provide the benefits described in para22 graph (1) until all such benefits have been 

23 paid and shall be accounted for separately 

24 from the other assets of the plan. 


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1 (ii) OVERSIGHT OF NON-ANNUITY IN2 VESTMENTS.— 

3 (I) IN GENERAL.—Any portfolio 

4 implemented under this paragraph 

5 shall be subject to oversight by the 

6 Pension Rehabilitation Administra7 tion, including a mandatory triennial 

8 review of the adequacy of the portfolio 

9 to provide the benefits described in 

10 paragraph (1) and approval (to be 

11 provided within a reasonable period of 

12 time) of any decision by the plan 

13 sponsor to change the investment 

14 manager of the portfolio. 

15 (II) REMEDIAL ACTION.—If the 

16 triennial review under subclause (I) 

17 determines an inadequacy, the plan 

18 sponsor shall take remedial action to 

19 ensure that the inadequacy will be 

20 cured within 5 years of the review. 

21 (E) OMBUDSPERSON.—The Participant 

22 and Plan Sponsor Advocate established under 

23 section 4004 of the Employee Retirement In24 come Security Act of 1974 shall act as 

25 ombudsperson for participants and beneficiaries 


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1 on behalf of whom annuity contracts are pur2 chased or who are covered by a portfolio under 

3 this paragraph. 

4 (e) COLLECTION OF REPAYMENT.—Except as pro5 vided in subsection (f), the Pension Rehabilitation Admin6 istration shall make every effort to collect repayment of 

7 loans under this section in accordance with section 3711 

8 of title 31, United States Code. 

9 (f) LOAN DEFAULT.—If a plan is unable to make any 

10 payment on a loan under this section when due, the Pen11 sion Rehabilitation Administration shall negotiate with the 

12 plan sponsor revised terms for repayment (including in13 stallment payments over a reasonable period or forgive14 ness of a portion of the loan principal), but only to the 

15 extent necessary to avoid insolvency in the subsequent 18 

16 months. 

17 (g) AUTHORITY TO ISSUE RULES, ETC.—The Direc18 tor of the Pension Rehabilitation Administration, in con19 sultation with the Pension Benefit Guaranty Corporation 

20 and the Department of Labor, is authorized to issue rules 

21 regarding the form, content, and process of applications 

22 for loans under this section, actuarial standards and as23 sumptions to be used in making estimates and projections 

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1 garding interest rates, mortality, and distributions with 

2 respect to a portfolio described in subsection (d)(3)(C). 

3 (h) COORDINATION WITH TAXATION OF UNRELATED

4 BUSINESS INCOME.—Subparagraph (A) of section 

5 514(c)(6) of the Internal Revenue Code of 1986 is amend6 ed— 

7 (1) by striking ‘‘or’’ at the end of clause (i); 

8 (2) by striking the period at the end of clause 

9 (ii)(II) and inserting ‘‘, or’’; and 

10 (3) by adding at the end the following new 

11 clause: 

12 ‘‘(iii) indebtedness with respect to a 

13 multiemployer plan under a loan made by 

14 the Pension Rehabilitation Administration 

15 pursuant to section 4 of the Butch Lewis 

16 Act of 2019.’’. 

17 SEC. 5. COORDINATION WITH WITHDRAWAL LIABILITY AND 

18 FUNDING RULES. 

19 (a) AMENDMENT TO INTERNAL REVENUE CODE OF

20 1986.—Section 432 of the Internal Revenue Code of 1986 

21 is amended by adding at the end the following new sub22 section: 

23 ‘‘(k) SPECIAL RULES FOR PLANS RECEIVING PEN24 SION REHABILITATION LOANS.— 


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1 ‘‘(1) DETERMINATION OF WITHDRAWAL LIABIL2 ITY.— 

3 ‘‘(A) IN GENERAL.—If any employer par4 ticipating in a plan at the time the plan receives 

5 a loan under section 4(a) of the Butch Lewis 

6 Act of 2019 withdraws from the plan before the 

7 end of the 30-year period beginning on the date 

8 of the loan, the withdrawal liability of such em9 ployer shall be determined under the Employee 

10 Retirement Income Security Act of 1974— 

11 ‘‘(i) by applying section 4219(c)(1)(D) 

12 of the Employee Retirement Income Secu13 rity Act of 1974 as if the plan were termi14 nating by the withdrawal of every employer 

15 from the plan, and 

16 ‘‘(ii) by determining the value of non17 forfeitable benefits under the plan at the 

18 time of the deemed termination by using 

19 the interest assumptions prescribed for 

20 purposes of section 4044 of the Employee 

21 Retirement Income Security Act of 1974, 

22 as prescribed in the regulations under sec23 tion 4281 of the Employee Retirement In24 come Security Act of 1974 in the case of 

25 such a mass withdrawal. 


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1 ‘‘(B) ANNUITY CONTRACTS AND INVEST2 MENT PORTFOLIOS PURCHASED WITH LOAN

3 FUNDS.—Annuity contracts purchased and 

4 portfolios implemented under section 4(d)(3) of 

5 the Butch Lewis Act of 2019 shall not be taken 

6 into account in determining the withdrawal li7 ability of any employer under subparagraph 

8 (A), but the amount equal to the greater of— 

9 ‘‘(i) the benefits provided under such 

10 contracts or portfolios to participants and 

11 beneficiaries, or 

12 ‘‘(ii) the remaining payments due on 

13 the loan under section 4(a) of such Act, 

14 shall be so taken into account. 

15 ‘‘(2) COORDINATION WITH FUNDING REQUIRE16 MENTS.—In the case of a plan which receives a loan 

17 under section 4(a) of the Butch Lewis Act of 

18 2019— 

19 ‘‘(A) annuity contracts purchased and 

20 portfolios implemented under section 4(d)(3) of 

21 such Act, and the benefits provided to partici22 pants and beneficiaries under such contracts or 

23 portfolios, shall not be taken into account in de24 termining minimum required contributions 

25 under section 412, 


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1 ‘‘(B) payments on the interest and prin2 cipal under the loan, and any benefits owed in 

3 excess of those provided under such contracts 

4 or portfolios, shall be taken into account as li5 abilities for purposes of such section, and 

6 ‘‘(C) if such a portfolio is projected due to 

7 unfavorable investment or actuarial experience 

8 to be unable to fully satisfy the liabilities which 

9 it covers, the amount of the liabilities projected 

10 to be unsatisfied shall be taken into account as 

11 liabilities for purposes of such section.’’. 

12 (b) AMENDMENT TO EMPLOYEE RETIREMENT IN13 COME SECURITY ACT OF 1974.—Section 305 of the Em14 ployee Retirement Income Security Act of 1974 (29 

15 U.S.C. 1085) is amended by adding at the end the fol16 lowing new subsection: 

17 ‘‘(k) SPECIAL RULES FOR PLANS RECEIVING PEN18 SION REHABILITATION LOANS.— 

19 ‘‘(1) DETERMINATION OF WITHDRAWAL LIABIL20 ITY.— 

21 ‘‘(A) IN GENERAL.—If any employer par22 ticipating in a plan at the time the plan receives 

23 a loan under section 4(a) of the Butch Lewis 

24 Act of 2019 withdraws from the plan before the 

25 end of the 30-year period beginning on the date 


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1 of the loan, the withdrawal liability of such em2 ployer shall be determined— 

3 ‘‘(i) by applying section 4219(c)(1)(D) 

4 as if the plan were terminating by the 

5 withdrawal of every employer from the 

6 plan, and 

7 ‘‘(ii) by determining the value of non8 forfeitable benefits under the plan at the 

9 time of the deemed termination by using 

10 the interest assumptions prescribed for 

11 purposes of section 4044, as prescribed in 

12 the regulations under section 4281 in the 

13 case of such a mass withdrawal. 

14 ‘‘(B) ANNUITY CONTRACTS AND INVEST15 MENT PORTFOLIOS PURCHASED WITH LOAN

16 FUNDS.—Annuity contracts purchased and 

17 portfolios implemented under section 4(d)(3) of 

18 the Butch Lewis Act of 2019 shall not be taken 

19 into account in determining the withdrawal li20 ability of any employer under subparagraph 

21 (A), but the amount equal to the greater of— 

22 ‘‘(i) the benefits provided under such 

23 contracts or portfolios to participants and 

24 beneficiaries, or 


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1 ‘‘(ii) the remaining payments due on 

2 the loan under section 4(a) of such Act, 

3 shall be so taken into account. 

4 ‘‘(2) COORDINATION WITH FUNDING REQUIRE5 MENTS.—In the case of a plan which receives a loan 

6 under section 4(a) of the Butch Lewis Act of 

7 2019— 

8 ‘‘(A) annuity contracts purchased and 

9 portfolios implemented under section 4(d)(3) of 

10 such Act, and the benefits provided to partici11 pants and beneficiaries under such contracts or 

12 portfolios, shall not be taken into account in de13 termining minimum required contributions 

14 under section 302, 

15 ‘‘(B) payments on the interest and prin16 cipal under the loan, and any benefits owed in 

17 excess of those provided under such contracts 

18 or portfolios, shall be taken into account as li19 abilities for purposes of such section, and 

20 ‘‘(C) if such a portfolio is projected due to 

21 unfavorable investment or actuarial experience 

22 to be unable to fully satisfy the liabilities which 

23 it covers, the amount of the liabilities projected 

24 to be unsatisfied shall be taken into account as 

25 liabilities for purposes of such section.’’. 


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1 SEC. 6. ISSUANCE OF TREASURY BONDS. 

2 The Secretary of the Treasury (in consultation with 

3 the Director of the Pension Rehabilitation Administration 

4 established under section 2) shall from time to time trans5 fer from the general fund of the Treasury to the Pension 

6 Rehabilitation Trust Fund established under section 9512 

7 of the Internal Revenue Code of 1986 such amounts as 

8 are necessary to fund the loan program under section 4 

9 of this Act, including from proceeds from the Secretary’s 

10 issuance of obligations under chapter 31 of title 31, 

11 United States Code. 

12 SEC. 7. REPORTS OF PLANS RECEIVING PENSION REHA13 BILITATION LOANS. 

14 (a) IN GENERAL.—Subpart E of part III of sub15 chapter A of chapter 61 of the Internal Revenue Code of 

16 1986 is amended by adding at the end the following new 

17 section: 

18 ‘‘SEC. 6059A. REPORTS OF PLANS RECEIVING PENSION RE19 HABILITATION LOANS. 

20 ‘‘(a) IN GENERAL.—In the case of a plan receiving 

21 a loan under section 4(a) of the Butch Lewis Act of 2019, 

22 with respect to the first plan year beginning after the date 

23 of the loan and each of the 29 succeeding plan years, not 

24 later than the 90th day of each such plan year the plan 

25 sponsor shall file with the Secretary a report (including 

26 appropriate documentation and actuarial certifications 


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1 from the plan actuary, as required by the Secretary) that 

2 contains— 

3 ‘‘(1) the funded percentage (as defined in sec4 tion 432(i)(2)) as of the first day of such plan year, 

5 and the underlying actuarial value of assets (deter6 mined with regard, and without regard, to annuity 

7 contracts purchased and portfolios implemented with 

8 proceeds of such loan) and liabilities (including any 

9 amounts due with respect to such loan) taken into 

10 account in determining such percentage, 

11 ‘‘(2) the market value of the assets of the plan 

12 (determined as provided in paragraph (1)) as of the 

13 last day of the plan year preceding such plan year, 

14 ‘‘(3) the total value of all contributions made by 

15 employers and employees during the plan year pre16 ceding such plan year, 

17 ‘‘(4) the total value of all benefits paid during 

18 the plan year preceding such plan year, 

19 ‘‘(5) cash flow projections for such plan year 

20 and the 9 succeeding plan years, and the assump21 tions used in making such projections, 

22 ‘‘(6) funding standard account projections for 

23 such plan year and the 9 succeeding plan years, and 

24 the assumptions relied upon in making such projec25 tions, 


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1 ‘‘(7) the total value of all investment gains or 

2 losses during the plan year preceding such plan year, 

3 ‘‘(8) any significant reduction in the number of 

4 active participants during the plan year preceding 

5 such plan year, and the reason for such reduction, 

6 ‘‘(9) a list of employers that withdrew from the 

7 plan in the plan year preceding such plan year, and 

8 the resulting reduction in contributions, 

9 ‘‘(10) a list of employers that paid withdrawal 

10 liability to the plan during the plan year preceding 

11 such plan year and, for each employer, a total as12 sessment of the withdrawal liability paid, the annual 

13 payment amount, and the number of years remain14 ing in the payment schedule with respect to such 

15 withdrawal liability, 

16 ‘‘(11) any material changes to benefits, accrual 

17 rates, or contribution rates during the plan year pre18 ceding such plan year, and whether such changes re19 late to the terms of the loan, 

20 ‘‘(12) details regarding any funding improve21 ment plan or rehabilitation plan and updates to such 

22 plan, 

23 ‘‘(13) the number of participants and bene24 ficiaries during the plan year preceding such plan 

25 year who are active participants, the number of parVerDate Sep 11 2014 00:49 Jul 31, 2019 Jkt 089200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\S2254.IS S2254

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1 ticipants and beneficiaries in pay status, and the 

2 number of terminated vested participants and bene3 ficiaries, 

4 ‘‘(14) the amount of any financial assistance re5 ceived under section 4261 of the Employee Retire6 ment Income Security Act of 1974 to pay benefits 

7 during the preceding plan year, and the total 

8 amount of such financial assistance received for all 

9 preceding years, 

10 ‘‘(15) the information contained on the most re11 cent annual funding notice submitted by the plan 

12 under section 101(f) of the Employee Retirement In13 come Security Act of 1974, 

14 ‘‘(16) the information contained on the most re15 cent annual return under section 6058 and actuarial 

16 report under section 6059 of the plan, and 

17 ‘‘(17) copies of the plan document and amend18 ments, other retirement benefit or ancillary benefit 

19 plans relating to the plan and contribution obliga20 tions under such plans, a breakdown of administra21 tive expenses of the plan, participant census data 

22 and distribution of benefits, the most recent actu23 arial valuation report as of the plan year, copies of 

24 collective bargaining agreements, and financial re25 ports, and such other information as the Secretary, 


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1 in consultation with the Director of the Pension Re2 habilitation Administration, may require. 

3 ‘‘(b) ELECTRONIC SUBMISSION.—The report re4 quired under subsection (a) shall be submitted electroni5 cally. 

6 ‘‘(c) INFORMATION SHARING.—The Secretary shall 

7 share the information in the report under subsection (a) 

8 with the Secretary of Labor and the Director of the Pen9 sion Benefit Guaranty Corporation. 

10 ‘‘(d) REPORT TO PARTICIPANTS, BENEFICIARIES, 

11 AND EMPLOYERS.—Each plan sponsor required to file a 

12 report under subsection (a) shall, before the expiration of 

13 the time prescribed for the filing of such report, also pro14 vide a summary (written in a manner so as to be under15 stood by the average plan participant) of the information 

16 in such report to participants and beneficiaries in the plan 

17 and to each employer with an obligation to contribute to 

18 the plan.’’. 

19 (b) PENALTY.—Subsection (e) of section 6652 of the 

20 Internal Revenue Code of 1986 is amended— 

21 (1) by inserting ‘‘, 6059A (relating to reports of 

22 plans receiving pension rehabilitation loans)’’ after 

23 ‘‘deferred compensation)’’; 

24 (2) by inserting ‘‘($100 in the case of failures 

25 under section 6059A)’’ after ‘‘$25’’; and 


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1 (3) by adding at the end the following: ‘‘In the 

2 case of a failure with respect to section 6059A, the 

3 amount imposed under this subsection shall not be 

4 paid from the assets of the plan.’’. 

5 (c) CLERICAL AMENDMENT.—The table of sections 

6 for subpart E of part III of subchapter A of chapter 61 

7 of the Internal Revenue Code of 1986 is amended by add8 ing at the end the following new item: 

‘‘Sec. 6059A. Reports of plans receiving pension rehabilitation loans.’’. 

9 SEC. 8. PBGC FINANCIAL ASSISTANCE. 

10 (a) IN GENERAL.—Section 4261 of the Employee Re11 tirement Income Security Act of 1974 (29 U.S.C. 1431) 

12 is amended by adding at the end the following new sub13 section: 

14 ‘‘(d)(1) The plan sponsor of a multiemployer plan— 

15 ‘‘(A) which is in critical and declining status 

16 (within the meaning of section 305(b)(6)) as of the 

17 date of the enactment of this subsection, or with re18 spect to which a suspension of benefits has been ap19 proved under section 305(e)(9) as of such date; 

20 ‘‘(B) which, as of such date of enactment, is in 

21 critical status (within the meaning of section 

22 305(b)(2)), has a funded percentage of less than 40 

23 percent (as determined for purposes of section 305), 

24 and has a ratio of active to inactive participants 

25 which is less than 2 to 3; or 


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1 ‘‘(C) which is insolvent for purposes of section 

2 418E of the Internal Revenue Code of 1986 as of 

3 such date of enactment, if the plan became insolvent 

4 after December 16, 2014, and has not been termi5 nated, 

6 and which is applying for a loan under section 4(a) of the 

7 Butch Lewis Act of 2019 may also apply to the corpora8 tion for financial assistance under this subsection, by 

9 jointly submitting such applications in accordance with 

10 section 4(d)(2) of such Act. The application for financial 

11 assistance under this subsection shall demonstrate, based 

12 on projections by the plan actuary, that after the receipt 

13 of the anticipated loan amount under section 4(a) of such 

14 Act, the plan will still become (or remain) insolvent within 

15 the 30-year period beginning on the date of the loan. 

16 ‘‘(2) In reviewing an application under paragraph 

17 (1), the corporation shall review the demonstrations and 

18 assumptions submitted with the loan application under 

19 section 4(c) of the Butch Lewis Act of 2019 and provide 

20 guidance regarding such assumptions prior to approving 

21 any application for financial assistance under this sub22 section. The corporation may deny any application if the 

23 assumptions and determinations are unreasonable, or in24 consistent with rules issued by the corporation, and the 


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1 plan and the corporation are unable to reach agreement 

2 on such assumptions and determinations. 

3 ‘‘(3) In the case of a plan described in paragraph 

4 (1)(A) or (1)(B), the financial assistance provided pursu5 ant to such application under this subsection shall be the 

6 amount (determined by the plan actuary and submitted 

7 on the application) equal to the sum of— 

8 ‘‘(A) the percentage of benefits of participants 

9 and beneficiaries of the plan in pay status at the 

10 time of the application; and 

11 ‘‘(B) the percentage of future benefits to which 

12 participants who have separated from service but are 

13 not yet in pay status are entitled, 

14 which, if such percentage were paid by the corporation in 

15 combination with the loan, would allow the plan to avoid 

16 projected insolvency. Such amount shall not exceed the 

17 maximum guaranteed benefit with respect to all partici18 pants and beneficiaries of the plan under sections 4022A 

19 and 4022B. For this purpose, the maximum guaranteed 

20 benefit amount shall be determined by disregarding any 

21 loan available from the Pension Rehabilitation Adminis22 tration and shall be determined as if the plan were insol23 vent on the date of the application. Further, the present 

24 value of the maximum guaranteed benefit amount with re25 spect to such participants and beneficiaries may be calVerDate Sep 11 2014 00:49 Jul 31, 2019 Jkt 089200 PO 00000 Frm 00036 Fmt 6652 Sfmt 6201 E:\BILLS\S2254.IS S2254

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1 culated in the aggregate, rather than by reference to the 

2 benefit of each such participant or beneficiary. 

3 ‘‘(4) In the case of a plan described in paragraph 

4 (1)(C), the financial assistance provided pursuant to such 

5 application under this subsection shall be the amount (de6 termined by the plan actuary and submitted on the appli7 cation) which, if such amount were paid by the corporation 

8 in combination with the loan and any other assistance 

9 being provided to the plan by the corporation at the time 

10 of the application, would enable the plan to emerge from 

11 the projected insolvency. 

12 ‘‘(5)(A) Except as provided in subparagraph (B), the 

13 corporation shall provide the financial assistance under 

14 this subsection only in such amounts as the corporation 

15 determines, at the time of approval and at the beginning 

16 of each plan year beginning thereafter during the period 

17 of assistance, are necessary for the plan to avoid insol18 vency during the 5 plan year period beginning with the 

19 current plan year. 

20 ‘‘(B) In the case of a plan described in paragraph 

21 (1)(C), the financial assistance under this subsection shall 

22 be provided in a lump sum if deemed necessary by the 

23 corporation, and in no case later than December 31, 2020. 

24 ‘‘(6) Subsections (b) and (c) shall apply to financial 

25 assistance under this subsection as if it were provided 


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1 under subsection (a), except that the terms for repayment 

2 under subsection (b)(2) shall not require the financial as3 sistance to be repaid before the date on which the loan 

4 under section 4(a) of the Butch Lewis Act of 2019 is re5 paid in full. 

6 ‘‘(7) The corporation may forgo repayment of the fi7 nancial assistance provided under this subsection if nec8 essary to avoid any suspension of the accrued benefits of 

9 participants.’’. 

10 (b) APPROPRIATIONS.—There is appropriated to the 

11 Director of the Pension Benefit Guaranty Corporation 

12 such sums as may be necessary for each fiscal year to pro13 vide the financial assistance described in section 4261(d) 

14 of the Employee Retirement Income Security Act of 1974 

15 (29 U.S.C. 1431(d)) (as added by this section) (including 

16 necessary administrative and operating expenses relating 

17 to such assistance). 

Æ 


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