II 

108TH CONGRESS 

1ST SESSION S. 1756

To amend the Internal Revenue Code of 1986 to protect the health benefits 

of retired miners and to restore stability and equity to the financing 

of the United Mine Workers of America Combined Benefit Fund by 

providing additional sources of revenue to the Fund, and for other 

purposes. 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 17, 2003

Mr. CONRAD (for himself, Mr. SMITH, Mr. BREAUX, Mr. COCHRAN, Ms. 

LANDRIEU, and Mr. CRAIG) 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 protect 

the health benefits of retired miners and to restore stability and equity to the financing of the United Mine 

Workers of America Combined Benefit Fund by providing additional sources of revenue to the Fund, 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,
2

•S 1756 IS 

1 SECTION 1. SHORT TITLE, ETC. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Coal Industry Retiree Health Benefit Stability and Fair4 ness Act’’. 

5 (b) AMENDMENT OF 1986 CODE.—Except as other6 wise expressly provided, whenever in this Act an amend7 ment or repeal is expressed in terms of an amendment 

8 to, or repeal of, a section or other provision, the reference 

9 shall be considered to be made to a section or other provi10 sion of the Internal Revenue Code of 1986. 

11 (c) TABLE OF CONTENTS.—The table of contents for 

12 this Act is as follows:

Sec. 1. Short title, etc. 

TITLE I—FINANCING PROVISIONS 

Subtitle A—Federal Funds 

Sec. 101. Mandatory transfer of general funds to Combined Benefit Fund. 

Sec. 102. Annual audit. 

Sec. 103. Appointment of Government trustees. 

Subtitle B—Premiums 

Sec. 111. Modifications of premiums to reflect transfers from general fund. 

Sec. 112. Refunds to certain operators. 

Sec. 113. Reduction in annual premiums to Combined Benefit Fund if surplus 

exists. 

Sec. 114. Refund of contributions paid by certain small entities to United Mine 

Workers Combined Benefit Fund. 

Sec. 115. First year payments of 1988 operators. 

Sec. 116. Liability in the event of prefunding. 

Sec. 117. Definition of successor in interest. 

TITLE II—RETROACTIVE PROVISIONS 

Sec. 201. Reform of retroactive provisions of Coal Industry Health Benefit System.
3

•S 1756 IS 

1 TITLE I—FINANCING 

2 PROVISIONS 

3 Subtitle A—Federal Funds 

4 SEC. 101. MANDATORY TRANSFER OF GENERAL FUNDS TO 

5 COMBINED BENEFIT FUND. 

6 (a) IN GENERAL.—Section 9705 (relating to trans7 fers to the Combined Benefit Fund) is amended by adding 

8 at the end the following new subsection: 

9 ‘‘(c) MANDATORY TRANSFERS FROM GENERAL

10 FUND.—

11 ‘‘(1) IN GENERAL.—There are hereby author12 ized and appropriated, out of any amounts in the 

13 Treasury not otherwise appropriated, to the Com14 bined Fund such sums as may be necessary to—

15 ‘‘(A) pay any benefit or administrative 

16 costs of unassigned beneficiaries of the Com17 bined Fund remaining after the transfer under 

18 subsection (b), and 

19 ‘‘(B) eliminate any annual deficit in any 

20 premium account of the Combined Fund as cer21 tified by the Trustees of the Combined Fund. 

22 Deficits referred to in subparagraph (B) shall be 

23 certified by the trustees only after utilizing and tak24 ing into account all premiums and other government 

25 reimbursements to the Fund. 
4

•S 1756 IS 

1 ‘‘(2) USE OF FUNDS.—Any amounts trans2 ferred under paragraph (1) shall be available with3 out fiscal year limitation. 

4 ‘‘(3) TRANSFER.—The Secretary of the Treas5 ury shall transfer amounts appropriated under para6 graph (1) on October 1 of each fiscal year.’’. 

7 (b) TRANSFER FROM ABANDONED MINE RECLAMA8 TION FUND.—Section 9705(b)(2) (relating to use of 

9 funds) is amended to read as follows: 

10 ‘‘(2) USE OF FUNDS.—Any amount transferred 

11 under paragraph (1) for any fiscal year shall be used 

12 to pay any benefit or administrative costs of unas13 signed beneficiaries of the Combined Fund for the 

14 plan year in which transferred.’’ 

15 (c) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to fiscal years beginning after Sep17 tember 30, 2003. 

18 SEC. 102. ANNUAL AUDIT. 

19 (a) IN GENERAL.—Section 9702 (relating to estab20 lishment of the Combined Fund) is amended by adding 

21 at the end the following: 

22 ‘‘(d) ANNUAL AUDIT.—

23 ‘‘(1) AUDIT.—The Comptroller General of the 

24 United States shall conduct an annual audit of the 

25 Combined Fund. Such audit shall include—
5

•S 1756 IS 

1 ‘‘(A) a review of the progress the Com2 bined Fund is making toward a managed care 

3 system as required under this subchapter, and 

4 ‘‘(B) a review of the use of, and necessity 

5 for, amounts transferred to the Combined Fund 

6 under section 9705(c). 

7 ‘‘(2) REPORT.—The Comptroller General shall 

8 report the results of any audit under paragraph (1) 

9 to the Secretary of the Treasury and to the appro10 priate committees of Congress, including the Comp11 troller General’s recommendations (if any) as to any 

12 administrative savings which may be achieved with13 out reducing the effective level of benefits under sec14 tion 9703.’’. 

15 (b) EFFECTIVE DATE.—The amendment made by 

16 subsection (a) shall apply to plan years of the Combined 

17 Fund beginning after the date of the enactment of this 

18 Act. 

19 SEC. 103. APPOINTMENT OF GOVERNMENT TRUSTEES. 

20 (a) IN GENERAL.—Section 9702(b)(1) (relating to 

21 the Board of Trustees), as amended by section 201(c), is 

22 amended by striking ‘‘and’’ at the end of subparagraph 

23 (B), by striking the period at the end of subparagraph 

24 (C) and inserting ‘‘; or’’, and by inserting after subpara25 graph (C) the following new subparagraph:
6

•S 1756 IS 

1 ‘‘(D) 2 persons designated by the Sec2 retary of the Treasury.’’ 

3 (b) EFFECTIVE DATE.—The amendments made by 

4 this section shall take effect on the date of the enactment 

5 of this Act.

6 Subtitle B—Premiums 

7 SEC. 111. MODIFICATIONS OF PREMIUMS TO REFLECT 

8 TRANSFERS FROM GENERAL FUND. 

9 (a) ELIMINATION OF UNASSIGNED BENEFICIARIES

10 PREMIUM.—Section 9704(d) (establishing unassigned 

11 beneficiaries premium) is amended to read as follows: 

12 ‘‘(d) UNASSIGNED BENEFICIARIES PREMIUM.—

13 ‘‘(1) PLAN YEARS ENDING ON OR BEFORE SEP14 TEMBER 30, 2003.—For plan years ending on or be15 fore September 30, 2003, the unassigned bene16 ficiaries premium for any assigned operator shall be 

17 equal to the applicable percentage of the product of 

18 the per beneficiary premium for the plan year multi19 plied by the number of eligible beneficiaries who are 

20 not assigned under section 9706 to any person for 

21 such plan year. 

22 ‘‘(2) PLAN YEARS BEGINNING ON OR AFTER OC23 TOBER 1, 2003.—For plan years beginning on or 

24 after October 1, 2003, there shall be no unassigned 

25 beneficiaries premium.’’. 
7

•S 1756 IS 

1 (b) PREMIUM ACCOUNTS.—

2 (1) CREDITING OF ACCOUNTS.—Section 

3 9704(e)(1) (relating to premium accounts; adjust4 ments) is amended by inserting ‘‘and amounts trans5 ferred under section 9705 (b) or (c)’’ after ‘‘pre6 miums received’’. 

7 (2) SHORTFALLS.—Section 9704(e)(3) (relating 

8 to shortfalls and surpluses) is amended—

9 (A) by striking ‘‘shortfall or’’ each place it 

10 appears in subparagraph (A), 

11 (B) by striking ‘‘reduced or increased, 

12 whichever is applicable,’’ in subparagraph (A) 

13 and inserting ‘‘reduced’’, 

14 (C) by striking ‘‘or the unassigned bene15 ficiaries premium account’’ in subparagraph 

16 (B), and 

17 (D) by striking ‘‘SHORTFALLS AND SUR18 PLUSES’’ in the heading and inserting ‘‘SUR19 PLUSES’’. 

20 (c) EFFECTIVE DATE.—The amendments made by 

21 this section shall apply to plan years of the Combined 

22 Fund beginning after September 30, 2003. 
8

•S 1756 IS 

1 SEC. 112. REFUNDS TO CERTAIN OPERATORS. 

2 (a) IN GENERAL.—Section 9704 (relating to the li3 ability of assigned operators) is amended by adding at the 

4 end the following new subsection: 

5 ‘‘(j) REFUNDS TO CERTAIN OPERATORS.—The Com6 bined Fund shall, before December 31, 2003, refund to 

7 an assigned operator which was an assigned operator prior 

8 to the date of the enactment of this subsection (and any 

9 related person to such operator) an amount equal to the 

10 sum of—

11 ‘‘(1) any amount paid by such operator or per12 son to the Combined Fund (and not previously re13 funded) by reason of the operator having been a sig14 natory to a pre-1974 coal wage agreement, and 

15 ‘‘(2) interest on the amount under paragraph 

16 (1) at the overpayment rate established under sec17 tion 6621 for the period from the payment of such 

18 amount to the refund under this subsection.’’

19 (b) EFFECTIVE DATE.—The amendment made by 

20 subsection (a) shall take effect on the date of the enact21 ment of this Act.

22 SEC. 113. REDUCTION IN ANNUAL PREMIUMS TO COM23 BINED BENEFIT FUND IF SURPLUS EXISTS. 

24 (a) IN GENERAL.—Part II of subchapter B of chap25 ter 99 (relating to financing of Combined Benefit Fund) 
9

•S 1756 IS 

1 is amended by inserting after section 9704 the following 

2 new section: 

3 ‘‘SEC. 9704A. REDUCTIONS IN HEALTH BENEFIT PREMIUM 

4 IF SURPLUS EXISTS. 

5 ‘‘(a) GENERAL RULE.—If this section applies to any 

6 plan year, the per beneficiary premium used for purposes 

7 of computing the health benefit premium under section 

8 9704(b) for the plan year shall be the reduced per bene9 ficiary premium determined under subsection (c). 

10 ‘‘(b) YEARS TO WHICH SECTION APPLIES.—

11 ‘‘(1) IN GENERAL.—This section applies to any 

12 plan year beginning after September 30, 2003, if the 

13 trustees determine that the Combined Fund has an 

14 excess reserve for the plan year. 

15 ‘‘(2) EXCESS RESERVE.—For purposes of this 

16 section—

17 ‘‘(A) IN GENERAL.—The term ‘excess re18 serve’ means, with respect to any plan year, the 

19 excess (if any) of—

20 ‘‘(i) the projected net assets as of the 

21 close of the test period for the plan year, 

22 over 

23 ‘‘(ii) the projected 3-month asset re24 serve as of such time. 
10

•S 1756 IS 

1 ‘‘(B) PROJECTED NET ASSETS.—For pur2 poses of subparagraph (A)(i), the projected net 

3 assets shall be the amount of the net assets 

4 which the trustees determine will be available at 

5 the end of the test period for projected fund 

6 benefits. Such determination shall be made in 

7 the same manner used by the Combined Fund 

8 to calculate net assets available for projected 

9 fund benefits in the Statement of Net Assets 

10 (Deficits) Available for Fund Benefits for pur11 poses of the monthly financial statements of the 

12 Combined Fund for the plan year beginning Oc13 tober 1, 2003. 

14 ‘‘(C) PROJECTED 3-MONTH ASSET RE15 SERVE.—For purposes of subparagraph (A)(ii), 

16 the projected 3-month asset reserve is an 

17 amount equal to 25 percent of the projected ex18 penses (including administrative expenses) from 

19 the health benefit premium account and unas20 signed beneficiaries premium account for the 

21 plan year immediately following the test period. 

22 The determination of such amount shall be 

23 based on the 10-year forecast of the projected 

24 net assets and cash balance of the Combined
11

•S 1756 IS 

1 Fund prepared annually by an actuary retained 

2 by the Combined Fund. 

3 ‘‘(D) TEST PERIOD.—For purposes of this 

4 section, the term ‘test period’ means, with re5 spect to any plan year, that plan year and the 

6 following plan year. 

7 ‘‘(c) REDUCED PER BENEFICIARY PREMIUM.—For 

8 purposes of this section, the reduced per beneficiary pre9 mium for any plan year to which this section applies is 

10 the per beneficiary premium determined under section 

11 9704(b)(2) without regard to this section, reduced (but 

12 not below zero) by—

13 ‘‘(1) the excess reserve for the plan year, di14 vided by 

15 ‘‘(2) the total number of eligible beneficiaries 

16 which are assigned to assigned operators under sec17 tion 9706 as of the close of the preceding plan year. 

18 ‘‘(d) TERMINATION OF PREMIUM REDUCTION.—If, 

19 on any day during a plan year to which this section ap20 plies, the Combined Fund has net assets available for pro21 jected fund benefits (determined in the same manner as 

22 projected net assets under subsection (b)(2)(B)) in an 

23 amount less than the projected 3-month asset reserve de24 termined under subsection (b)(2)(C) for the plan year—
12

•S 1756 IS 

1 ‘‘(1) this section shall not apply to months in 

2 the plan year beginning after such day, and 

3 ‘‘(2) the monthly installment under section 

4 9704(g)(1) for such months shall be equal to the 

5 amount which would have been determined if the 

6 health benefits premium under section 9704(b) had 

7 not been reduced under this section for the plan 

8 year.’’

9 (b) CONFORMING AMENDMENTS.—

10 (1) Section 9704(a) (relating to annual pre11 miums) is amended by striking ‘‘Each’’ and insert12 ing ‘‘Subject to section 9704A, each’’. 

13 (2) The table of sections for part II of sub14 chapter B of chapter 99 is amended by inserting 

15 after the item relating to section 9704 the following 

16 new item:

‘‘Sec. 9704A. Reductions in health benefit premium if surplus exists.’’

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to plan years of the Combined 

19 Fund beginning after September 30, 2003. 
13

•S 1756 IS 

1 SEC. 114. REFUND OF CONTRIBUTIONS PAID BY CERTAIN 

2 SMALL ENTITIES TO UNITED MINE WORKERS 

3 COMBINED BENEFIT FUND. 

4 (a) IN GENERAL.—Part II of subchapter B of chap5 ter 99, as amended by section 113, is amended by insert6 ing after section 9704A the following new section: 

7 ‘‘SEC. 9704B. REFUNDS OF ANNUAL PREMIUMS OF CERTAIN 

8 SMALL ENTITIES. 

9 ‘‘(a) GENERAL RULE.—The Combined Fund shall re10 fund to each eligible small entity any premiums paid by 

11 the entity to the Combined Fund under section 9704 for 

12 any plan year of the Combined Fund which began before 

13 October 1, 2003. This section shall not apply to any pre14 mium which was previously refunded. 

15 ‘‘(b) ELIGIBLE SMALL ENTITY.—For purposes of 

16 this section, the term ‘eligible small entity’ means an as17 signed operator, but only if, as determined under the 

18 records of the Combined Fund, such operator (or any re19 lated person of such operator)—

20 ‘‘(1) was not a signatory to the 1981 or later 

21 National Bituminous Coal Wage Agreement or any 

22 ‘me too’ agreement related to such Coal Wage 

23 Agreement; 

24 ‘‘(2) reported credit hours to the UMWA 1974 

25 Pension Plan on fewer than ten classified mine 

26 workers in every month during its last year of oper-
14

•S 1756 IS 

1 ations under the National Bituminous Coal Wage 

2 Agreement of 1978 or any ‘me too’ agreement re3 lated to such Coal Wage Agreement; 

4 ‘‘(3) has had not more than 60 beneficiaries, in5 cluding eligible dependents of retired miners, as6 signed to it under section 9706 (determined without 

7 regard to beneficiary assignments relieved by the So8 cial Security Administration); 

9 ‘‘(4) was assessed premiums by the Combined 

10 Fund, made payments pursuant to those assess11 ments, and has no delinquency as of September 30, 

12 2003; and 

13 ‘‘(5) is not directly engaged in the production 

14 or sale of coal engaged in the production of coal as 

15 of September 30, 2003.’’

16 (b) CONFORMING AMENDMENT.—The table of sec17 tions for part II of subchapter B of chapter 99 is amended 

18 by inserting after the item relating to section 9704A the 

19 following new item:

‘‘Sec. 9704B. Refunds of annual premiums of certain small entities.’’

20 (c) EFFECTIVE DATE.—The amendments made by 

21 this section shall take effect on the date of the enactment 

22 of this Act. 
15

•S 1756 IS 

1 SEC. 115. FIRST YEAR PAYMENTS OF 1988 OPERATORS. 

2 (a) IN GENERAL.—So much of section 9704(i)(1)(D) 

3 as precedes clause (ii) is amended to read as follows: 

4 ‘‘(D) PREMIUM REDUCTIONS AND RE5 FUNDS.—

6 ‘‘(i) 1ST YEAR PAYMENTS.—In the 

7 case of a 1988 agreement operator making 

8 payments under subparagraph (A)—

9 ‘‘(I) the premium of such oper10 ator under subsection (a) shall be re11 duced by the amount paid under sub12 paragraph (A) by such operator for 

13 the plan year beginning February 1, 

14 1993, and

15 ‘‘(II) if the amount so paid ex16 ceeds the operator’s liability under 

17 subsection (a), the excess shall be re18 funded to the operator before Decem19 ber 31, 2003.’’

20 (b) EFFECTIVE DATE.—The amendment made by 

21 subsection (a) shall take effect on the date of the enact22 ment of this Act.

23 SEC. 116. LIABILITY IN THE EVENT OF PREFUNDING. 

24 (a) IN GENERAL.—Section 9704 is amended—
16

•S 1756 IS 

1 (1) by striking ‘‘Any’’ in the last sentence of 

2 subsection (a) and inserting ‘‘Except as provided in 

3 subsection (k), any’’, and 

4 (2) by adding at the end the following new sub5 section: 

6 ‘‘(k) RELATED PERSONS RELIEVED OF LIABILITY

7 FUNDED THROUGH VOLUNTARY EMPLOYEES’ BENE8 FICIARY ASSOCIATION.—

9 ‘‘(1) IN GENERAL.—If a qualified voluntary em10 ployees’ beneficiary association is established with 

11 respect to any signatory operator, then, as of the 

12 date determined under paragraph (2)—

13 ‘‘(A) the last sentence of subsection (a) 

14 shall not apply to any related person with re15 spect to the operator (determined without re16 gard to this subsection), and 

17 ‘‘(B) all such persons shall permanently 

18 cease to be treated for purposes of this sub19 chapter as related persons with respect to the 

20 signatory operator. 

21 ‘‘(2) TIMING OF LIMITATION ON LIABILITY.—

22 The date determined under this paragraph shall be 

23 the first date by which all of the following have oc24 curred: 
17

•S 1756 IS 

1 ‘‘(A) The qualified voluntary employees’ 

2 beneficiary association’s enrolled actuary (as 

3 defined in section 7701(a)(35)), using actuarial 

4 methods and assumptions each of which is rea5 sonable and which are reasonable in the aggre6 gate (as determined by such enrolled actuary), 

7 determines the balance of funds held by the as8 sociation, resulting from 1 or more contribu9 tions to the association and earnings thereon, 

10 equals or exceeds the sum of—

11 ‘‘(i) the present value of the total pre12 mium liability of the signatory operator for 

13 its assignees under section 9704 with re14 spect to the Combined Fund, plus

15 ‘‘(ii) the amount necessary to pay ad16 ministrative and other incidental expenses 

17 of such association. 

18 ‘‘(B) The enrolled actuary files a signed 

19 actuarial report with the Secretary containing—

20 ‘‘(i) the date of the actuarial valuation 

21 applicable to the report, 

22 ‘‘(ii) a description of the funding 

23 method and actuarial assumptions used to 

24 determine costs of the association, 
18

•S 1756 IS 

1 ‘‘(iii) a statement by the enrolled ac2 tuary signing the report that to the best of 

3 the actuary’s knowledge the report is com4 plete and accurate and that in the actu5 ary’s opinion the actuarial assumptions 

6 used are in the aggregate—

7 ‘‘(I) reasonably related to the ex8 perience of the association and to rea9 sonable expectations, and 

10 ‘‘(II) represent the actuary’s best 

11 estimate of anticipated experience of 

12 the association, and 

13 ‘‘(iv) such other information as may 

14 be necessary to fully and fairly disclose the 

15 actuarial position of the association. 

16 ‘‘(C) The signatory operator provides secu17 rity (in the form of a bond, letter of credit, or 

18 cash escrow) to the trustees of the 1992 

19 UMWA Benefit Plan which—

20 ‘‘(i) is solely for the purpose of paying 

21 premiums for beneficiaries described in 

22 section 9712(b)(2)(B), 

23 ‘‘(ii) is in an amount equal to 1 year’s 

24 liability of the signatory operator under 

25 section 9711, determined by using the av-
19

•S 1756 IS 

1 erage cost of such operator’s liability dur2 ing its prior 3 calendar years, and 

3 ‘‘(iii) is to remain in place for a pe4 riod of 5 years. 

5 ‘‘(D) 30 calendar days have elapsed after 

6 the report required by subparagraph (B) is filed 

7 with the Secretary, along with a description of 

8 the security required by subparagraph (C), and 

9 the Secretary has not notified the association’s 

10 enrolled actuary in writing that the require11 ments of this subparagraph have not been satis12 fied. 

13 ‘‘(3) QUALIFIED VOLUNTARY EMPLOYEES’ BEN14 EFICIARY ASSOCIATION.—For purposes of this sub15 section, the term ‘qualified voluntary employees’ 

16 beneficiary association’ means, with respect to a sig17 natory operator, an association described in section 

18 501(c)(9)—

19 ‘‘(A) which is established by the operator, 

20 a related person to the operator (determined 

21 without regard to this subsection), or a member 

22 of a controlled group of corporations which in23 cludes the operator; 

24 ‘‘(B) the purpose of which is exclusively—
20

•S 1756 IS 

1 ‘‘(i) to satisfy the premium liability of 

2 the signatory operator with respect to the 

3 Combined Fund, 

4 ‘‘(ii) to fund health benefits provided 

5 pursuant to a collective bargaining agree6 ment, including benefits for individuals 

7 covered by sections 9711 and 9712, or to 

8 fund premiums for insurance exclusively 

9 covering such benefits, and 

10 ‘‘(iii) to pay administrative and other 

11 incidental expenses of such association; 

12 ‘‘(C) no part of the assets of which may be 

13 used for, or diverted to, any purpose other than 

14 the purposes described in subparagraph (B); 

15 and 

16 ‘‘(D) payments from which may be made 

17 for the purposes described in subparagraph 

18 (B)(ii) only to the extent that—

19 ‘‘(i) the signatory operator no longer 

20 has an obligation to make payments under 

21 subparagraph (B)(i); or 

22 ‘‘(ii) during any annual accounting 

23 period of the association such payments do 

24 not exceed, in the aggregate, 90 percent of 

25 the excess of—
21

•S 1756 IS 

1 ‘‘(I) fair market value of the as2 sociation’s assets, over 

3 ‘‘(II) the present value of the li4 ability described in subparagraph 

5 (B)(i). 

6 Amounts under subparagraph (D)(ii) shall be deter7 mined, as of the end of the association’s prior year 

8 annual accounting period, by the association’s en9 rolled actuary (as defined in section 7701(a)(35)) 

10 using actuarial methods and assumptions each of 

11 which is reasonable and which are reasonable in the 

12 aggregate (as determined by such enrolled actuary). 

13 ‘‘(4) OTHER RULES RELATING TO ASSOCIA14 TIONS.—For purposes of this subsection—

15 ‘‘(A) if a qualified voluntary employees’ 

16 beneficiary association makes a payment, the 

17 association’s enrolled actuary shall, within 30 

18 days after the end of the association’s annual 

19 accounting period which includes the payment, 

20 file with the Secretary an actuarial report con21 taining the information described in paragraph 

22 (2)(B) and a statement that the requirements 

23 of paragraph (3)(D) have been satisfied during 

24 the prior year; and
22

•S 1756 IS 

1 ‘‘(B) a signatory operator, or member of 

2 the controlled group of corporations which in3 cludes such signatory operator, which has pre4 viously established an association under section 

5 501(c)(9) for purposes which include purposes 

6 described in paragraph (3) may use funds from 

7 such previously established association to fund 

8 all or a portion of the association established 

9 under this subsection.’’

10 (b) CONFORMING AMENDMENT.—Section 

11 419A(f)(5)(A) is amended by inserting ‘‘, including a 

12 qualified voluntary employees’ beneficiary association (as 

13 defined in section 9704(k))’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply with respect to associations estab16 lished after the date of the enactment of this Act. 

17 SEC. 117. DEFINITION OF SUCCESSOR IN INTEREST. 

18 (a) IN GENERAL.—Subsection (c) of section 9701 is 

19 amended by adding at the end the following new para20 graph: 

21 ‘‘(8) SUCCESSOR IN INTEREST.—

22 ‘‘(A) SAFE HARBOR.—The term ‘successor 

23 in interest’ shall not include any person—

24 ‘‘(i) who is an unrelated person to a 

25 seller, and 
23

•S 1756 IS 

1 ‘‘(ii) who purchases for fair market 

2 value assets, or all the stock of a related 

3 person, in a bona fide, arm’s-length sale 

4 which is subject to section 5 of the Securi5 ties Act of 1933 (15 U.S.C. 77f et seq.) or 

6 the Securities Exchange Act of 1934 (15 

7 U.S.C.78a et seq.). 

8 ‘‘(B) UNRELATED PERSON.—The term 

9 ‘unrelated person’ means a purchaser who does 

10 not bear a relationship to the seller described 

11 in section 267(b). 

12 ‘‘(C) CONTINGENT LIABILITY.—This para13 graph shall only apply if the contract for sale 

14 provides that, if the seller fails to make a pre15 mium payment to the Combined Fund during 

16 the first 5 plan years beginning after the sale, 

17 then the purchaser shall be secondarily liable 

18 for any liability to the Combined Fund it would 

19 have had but for the provisions of this para20 graph. 

21 ‘‘(D) NO INFERENCE.—Nothing in this 

22 paragraph shall be construed to infer that a 

23 purchaser in a sale not described in this para24 graph is a successor in interest.’’
24

•S 1756 IS 

1 (b) EFFECTIVE DATE.—The amendment made by 

2 subsection (a) shall apply to transactions after the date 

3 of the enactment of this Act. 

4 TITLE II—RETROACTIVE 

5 PROVISIONS 

6 SEC. 201. REFORM OF RETROACTIVE PROVISIONS OF COAL 

7 INDUSTRY HEALTH BENEFIT SYSTEM. 

8 (a) AGREEMENTS COVERED BY HEALTH BENEFIT

9 SYSTEM.—

10 (1) IN GENERAL.—Section 9701(b)(1) (defining 

11 coal wage agreement) is amended to read as follows: 

12 ‘‘(1) COAL AGREEMENTS.—

13 ‘‘(A) 1988 AGREEMENT.—The term ‘1988 

14 agreement’ means the collective bargaining 

15 agreement between the settlors which became 

16 effective on February 1, 1988. 

17 ‘‘(B) COAL WAGE AGREEMENT.—The term 

18 ‘coal wage agreement’ means the 1988 agree19 ment and any predecessor to the 1988 agree20 ment.’’

21 (2) CONFORMING AMENDMENT.—Section 

22 9701(b) (relating to agreements) is amended by 

23 striking paragraph (3). 

24 (b) DEFINITIONS APPLICABLE TO OPERATORS.—
25

•S 1756 IS 

1 (1) SIGNATORY OPERATOR.—Section 9701(c)(1) 

2 (defining signatory operator) is amended to read as 

3 follows: 

4 ‘‘(1) SIGNATORY OPERATOR.—The term ‘signa5 tory operator’ means a 1988 agreement operator.’’. 

6 (2) 1988 AGREEMENT OPERATOR.—Section 

7 9701(c)(3) (defining 1988 agreement operator) is 

8 amended to read as follows: 

9 ‘‘(3) 1988 AGREEMENT OPERATOR.—The term 

10 ‘1988 agreement operator’ means—

11 ‘‘(A) an operator which was a signatory to 

12 the 1988 agreement, or 

13 ‘‘(B) a person in business which, during 

14 the term of the 1988 agreement, was a signa15 tory to an agreement (other than the National 

16 Coal Mine Construction Agreement or the Coal 

17 Haulers’ Agreement) containing pension and 

18 health care contribution and benefit provisions 

19 which are the same as those contained in the 

20 1988 agreement. 

21 Such term shall not include any operator who was 

22 assessed, and paid the full amount of, contractual 

23 withdrawal liability to the 1950 UMWA Benefit 

24 Plan, the 1974 UMWA Benefit Plan, or the Com25 bined Fund.’’
26

•S 1756 IS 

1 (3) CONFORMING AMENDMENTS.—

2 (A) Section 9711(a) is amended by strik3 ing ‘‘maintained pursuant to a 1978 or subse4 quent coal wage agreement’’. 

5 (B) Section 9711(b)(1) is amended by 

6 striking ‘‘pursuant to a 1978 or subsequent 

7 coal wage agreement’’. 

8 (c) MODIFICATIONS TO REFLECT REACHBACK RE9 FORMS.—

10 (1) BOARD OF TRUSTEES OF COMBINED

11 FUND.—

12 (A) IN GENERAL.—Section 9702(b)(1) is 

13 amended—

14 (i) by striking ‘‘one individual who 

15 represents’’ in subparagraph (A) and in16 serting ‘‘two individuals who represent’’, 

17 (ii) by striking subparagraph (B) and 

18 redesignating subparagraphs (C) and (D) 

19 as subparagraphs (B) and (C), respec20 tively, and 

21 (iii) by striking ‘‘(A), (B), and (C)’’ in 

22 subparagraph (C) (as so redesignated) and 

23 inserting ‘‘(A) and (B)’’. 

24 (B) CONFORMING AMENDMENT.—Section 

25 9702(b)(3) is amended to read as follows: 
27

•S 1756 IS 

1 ‘‘(3) SPECIAL RULE.—If the BCOA ceases to 

2 exist, any trustee or successor under paragraph 

3 (1)(A) shall be designated by the 3 employers who 

4 were members of the BCOA on October 24, 1992, 

5 and who have been assigned the greatest number of 

6 eligible beneficiaries under section 9706.’’

7 (C) TRANSITION RULE.—Any trustee serv8 ing on the date of the enactment of this Act 

9 who was appointed to serve under section

10 9702(b)(1)(B) of the Internal Revenue Code of 

11 1986 (as in effect before the amendments made 

12 by this paragraph) shall continue to serve until 

13 a successor is appointed under section 

14 9702(b)(1)(A) of such Code (as in effect after 

15 such amendments). 

16 (2) ASSIGNMENT OF BENEFICIARIES.—Section 

17 9706 (relating to assignment of eligible bene18 ficiaries) is amended by adding at the end the fol19 lowing: 

20 ‘‘(h) ASSIGNMENT AS OF OCTOBER 1, 2003.—

21 ‘‘(1) IN GENERAL.—Effective October 1, 2003, 

22 the Commissioner of Social Security shall—

23 ‘‘(A) revoke all assignments to persons 

24 other than 1988 agreement operators for pur-
28

•S 1756 IS 

1 poses of assessing premiums for periods after 

2 September 30, 2003, 

3 ‘‘(B) make no further assignments to per4 sons other than 1988 agreement operators, and 

5 ‘‘(C) terminate all unpaid liabilities of per6 sons other than 1988 agreement operators with 

7 respect to eligible beneficiaries whose assign8 ment to such persons is pending on October 1, 

9 2003. 

10 ‘‘(2) REASSIGNMENT UPON PURCHASE.—This 

11 subsection shall not be construed to prohibit the re12 assignment under subsection (b)(2) of an eligible 

13 beneficiary.’’

Æ