I

105TH CONGRESS

1ST SESSION H. R. 766

To amend the Internal Revenue Code of 1986 to provide comprehensive

pension protection for women.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 13, 1997

Mrs. KENNELLY of Connecticut (for herself, Ms. BROWN of Florida, Mrs.

CARSON, Ms. JACKSON-LEE of Texas, Ms. KAPTUR, Mrs. LOWEY, Mrs.

MALONEY of New York, Mrs. MEEK of Florida, Ms. MILLENDERMCDONALD, Ms. SANCHEZ, Mrs. MORELLA, and Ms. FURSE) introduced

the following bill; which was referred to the Committee on Ways and

Means, and in addition to the Committees on Education and the

Workforce, Transportation and Infrastructure, and Government Reform

and Oversight, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To amend the Internal Revenue Code of 1986 to provide

comprehensive pension protection for women.

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

5 ‘‘Comprehensive Women’s Pension Protection Act of

6 1997’’.
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1 (b) TABLE OF CONTENTS.—

Sec. 1. Short title.

TITLE I—PENSION REFORM

Sec. 101. Pension integration rules.

Sec. 102. Application of minimum coverage requirements with respect to separate lines of business.

Sec. 103. Division of pension benefits upon divorce.

Sec. 104. Clarification of continued availability of remedies relating to matters

treated in domestic relations orders entered before 1985.

Sec. 105. Entitlement of divorced spouses to railroad retirement annuities independent of actual entitlement of employee.

Sec. 106. Effective dates.

TITLE II—PROTECTION OF RIGHTS OF FORMER SPOUSES TO

PENSION BENEFITS UNDER CERTAIN GOVERNMENT AND GOVERNMENT-SPONSORED RETIREMENT PROGRAMS

Sec. 201. Extension of tier II railroad retirement benefits to surviving former

spouses pursuant to divorce agreements.

Sec. 202. Survivor annuities for widows, widowers, and former spouses of Federal employees who die before attaining age for deferred annuity under civil service retirement system.

Sec. 203. Court orders relating to Federal retirement benefits for former

spouses of Federal employees.

TITLE III—REFORMS RELATED TO 401(K) PLANS

Sec. 301. Requirement of annual, detailed investment reports applied to certain

401(k) plans.

Sec. 302. Section 401(k) investment protection.

TITLE IV—MODIFICATIONS OF JOINT AND SURVIVOR ANNUITY

REQUIREMENTS

Sec. 401. Modifications of joint and survivor annuity requirements.

TITLE V—SPOUSAL CONSENT REQUIRED FOR DISTRIBUTIONS

FROM SECTION 401(K) PLANS

Sec. 501. Spousal consent required for distributions from section 401(k) plans.

TITLE VI—WOMEN’S PENSION TOLL-FREE PHONE NUMBER

Sec. 601. Women’s pension toll-free phone number.

TITLE VII—PERIODIC PENSION BENEFITS STATEMENTS

Sec. 701. Periodic pension benefits statements.
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1 TITLE I—PENSION REFORM

2 SEC. 101. PENSION INTEGRATION RULES.

3 (a) APPLICABILITY OF NEW INTEGRATION RULES

4 EXTENDED TO ALL EXISTING ACCRUED BENEFITS.—

5 Notwithstanding subsection (c)(1) of section 1111 of the

6 Tax Reform Act of 1986 (relating to effective date of ap7 plication of nondiscrimination rules to integrated plans)

8 (100 Stat. 2440), effective for plan years beginning after

9 the date of the enactment of this Act, the amendments

10 made by subsection (a) of such section 1111 shall also

11 apply to benefits attributable to plan years beginning on

12 or before December 31, 1988.

13 (b) INTEGRATION DISALLOWED FOR SIMPLIFIED

14 EMPLOYEE PENSIONS.—

15 (1) IN GENERAL.—Subparagraph (D) of section

16 408(k)(3) of the Internal Revenue Code of 1986 (re17 lating to permitted disparity under rules limiting

18 discrimination under simplified employee pensions)

19 is repealed.

20 (2) CONFORMING AMENDMENT.—Subparagraph

21 (C) of such section 408(k)(3) is amended by striking

22 ‘‘and except as provided in subparagraph (D),’’.

23 (3) EFFECTIVE DATE.—The amendments made

24 by this subsection shall apply with respect to taxable

25 years beginning on or after January 1, 1998.
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1 (c) EVENTUAL REPEAL OF INTEGRATION RULES.—

2 Effective for plan years beginning on or after January 1,

3 2004—

4 (1) subparagraphs (C) and (D) of section

5 401(a)(5) of the Internal Revenue Code of 1986 (re6 lating to pension integration exceptions under non7 discrimination requirements for qualification) are re8 pealed, and subparagraph (E) of such section

9 401(a)(5) is redesignated as subparagraph (C); and

10 (2) subsection (l) of section 401 of such Code

11 (relating to nondiscriminatory coordination of de12 fined contribution plans with OASDI) is repealed.

13 SEC. 102. APPLICATION OF MINIMUM COVERAGE REQUIRE14 MENTS WITH RESPECT TO SEPARATE LINES

15 OF BUSINESS.

16 (a) IN GENERAL.—Subsection (b) of section 410 of

17 the Internal Revenue Code of 1986 (relating to minimum

18 coverage requirements) is amended—

19 (1) in paragraph (1), by striking ‘‘A trust’’ and

20 inserting ‘‘In any case in which the employer with

21 respect to a plan is treated, under section 414(r), as

22 operating separate lines of business for a plan year,

23 a trust’’, and by inserting ‘‘for such plan year’’ after

24 ‘‘requirements’’; and
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1 (2) by redesignating paragraphs (3) through

2 (6) as paragraphs (4) through (7), respectively and

3 by inserting after paragraph (2) the following new

4 paragraph:

5 ‘‘(3) SPECIAL RULE WHERE EMPLOYER OPER6 ATES SINGLE LINE OF BUSINESS.—In any case in

7 which the employer with respect to a plan is not

8 treated, under section 414(r), as operating separate

9 lines of business for a plan year, a trust shall not

10 constitute a qualified trust under section 401(a) un11 less such trust is designated by the employer as part

12 of a plan which benefits all employees of the em13 ployer.’’.

14 (b) LIMITATION ON LINE OF BUSINESS EXCEP15 TION.—Paragraph (6) of section 410(b) of such Code (as

16 redesignated by subsection (a)(2) of this section) is

17 amended by inserting ‘‘other than paragraph (1)(A)’’ after

18 ‘‘this subsection’’.

19 SEC. 103. DIVISION OF PENSION BENEFITS UPON DIVORCE.

20 (a) AMENDMENTS TO THE INTERNAL REVENUE

21 CODE OF 1986.—

22 (1) IN GENERAL.—Paragraph (1) of section

23 414(p) of the Internal Revenue Code of 1986 (relat24 ing to qualified domestic relations order defined) is
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1 amended by adding at the end the following new

2 subparagraph:

3 ‘‘(C) DEEMED DOMESTIC RELATIONS

4 ORDER UPON DIVORCE.—

5 ‘‘(i) IN GENERAL.—Except as pro6 vided in clause (iv), a domestic relations

7 order with respect to a marriage of at least

8 5 years duration between the participant

9 and the former spouse (including an annul10 ment or other order of marital dissolution)

11 shall, if the former spouse, within 60 days

12 after the receipt of notice under paragraph

13 (6)(B)(i)(II), so elects, be deemed by the

14 plan to be a domestic relations order that

15 specifies that 50 percent of the marital

16 share of the participant’s accrued benefit

17 is to be provided to such former spouse.

18 ‘‘(ii) MARITAL SHARE.—The marital

19 share shall be the accrued benefit of the

20 participant under the plan as of the date

21 of the first payment under the plan (to the

22 extent such accrued benefit is vested at the

23 date of the divorce or any later date) mul24 tiplied by a fraction, the numerator of

25 which is the period of participation by the
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1 participant under the plan starting with

2 the date of marriage and ending with the

3 date of divorce, and the denominator of

4 which is the total period of participation by

5 the participant under the plan.

6 ‘‘(iii) INTERPRETATION AS QUALIFIED

7 DOMESTIC RELATIONS ORDER.—Each plan

8 shall establish reasonable rules for deter9 mining how any such deemed domestic re10 lations order is to be interpreted under the

11 plan so as to constitute a qualified domes12 tic relations order that satisfies paragraphs

13 (2) through (4) (and a copy of such rules

14 shall be provided to such former spouse

15 promptly after delivery of the divorce de16 cree). Such rules—

17 ‘‘(I) may delay the effect of such

18 an order until the earlier of the date

19 the participant is fully vested or has

20 terminated employment,

21 ‘‘(II) may allow the former

22 spouse to be paid out immediately,

23 ‘‘(III) shall permit the former

24 spouse to be paid not later than the
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1 earliest retirement age under the plan

2 or the participant’s death,

3 ‘‘(IV) may require the submitter

4 of the divorce decree to present a

5 marriage certificate or other evidence

6 of the marriage date to assist in bene7 fit calculations, and

8 ‘‘(V) may conform to the rules

9 applicable to qualified domestic rela10 tions orders regarding form or type of

11 benefit.

12 ‘‘(iv) APPLICATION.—This subpara13 graph shall not apply—

14 ‘‘(I) if the domestic relations

15 order states that pension benefits

16 were considered by the parties and no

17 division is intended, or

18 ‘‘(II) to the extent that a quali19 fied domestic relations order issued in

20 connection with such divorce provides

21 otherwise.’’.

22 (2) NOTIFICATION PROCEDURES.—Section

23 414(p)(6) of such Code (relating to plan procedures

24 with respect to orders) is amended by striking sub25 paragraph (A), by redesignating subparagraph (B)
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1 as subparagraph (C), and by inserting before sub2 paragraph (C) (as so redesignated) the following

3 new subparagraphs:

4 ‘‘(A) NOTICE AND DETERMINATION BY AD5 MINISTRATOR.—In the case of any domestic re6 lations order received by a plan, including such

7 an order received under subparagraph (B) or

8 section 4980B(f)(6)(C)—

9 ‘‘(i) within 14 days after receipt of

10 such order, the plan administrator shall—

11 ‘‘(I) notify the participant and

12 each alternate payee of the receipt of

13 such order and the plan’s procedures

14 for determining the qualified status of

15 domestic relation orders, and

16 ‘‘(II) notify the former spouse of

17 such former spouse’s rights under

18 paragraph (1)(C), and

19 ‘‘(ii) within a reasonable period after

20 receipt of such order, the plan adminis21 trator shall determine whether such order

22 is a qualified domestic relations order and

23 notify the participant and each alternate

24 payee of such determination.
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1 ‘‘(B) NOTIFICATION OF PLAN ADMINIS2 TRATOR.—In the case of a domestic relations

3 order which is not a qualified domestic relations

4 order, each plan—

5 ‘‘(i) shall require that each participant

6 is responsible for notifying the plan admin7 istrator of the occurrence of a divorce of

8 the participant from the former spouse and

9 for delivery to the plan administrator of

10 the domestic relations order along with the

11 information required by paragraph (2)(A)

12 within 60 days after the date of the di13 vorce, and

14 ‘‘(ii) shall allow a former spouse to so

15 notify the plan administrator and deliver to

16 the plan administrator the domestic rela17 tions order within 60 days after the date

18 of the divorce.’’.

19 (b) AMENDMENTS TO THE EMPLOYEE RETIREMENT

20 INCOME SECURITY ACT OF 1974.—

21 (1) IN GENERAL.—Subsection (d)(3)(B) of sec22 tion 206 of the Employee Retirement Income Secu23 rity Act of 1974 (29 U.S.C. 1056) is amended—

24 (A) by striking ‘‘this paragraph—’’ and in25 serting ‘‘this paragraph:’’,
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1 (B) in clause (i)—

2 (i) by striking ‘‘the term’’ and insert3 ing ‘‘The term’’, and

4 (ii) by striking ‘‘met, and’’ and insert5 ing ‘‘met.’’,

6 (C) in clause (ii), by striking ‘‘the term’’

7 and inserting ‘‘The term’’, and

8 (D) by adding at the end the following new

9 clause:

10 ‘‘(iii)(I) Except as provided on subclause (IV),

11 a domestic relations order with respect to a marriage

12 of at least 5 years duration between the participant

13 and the former spouse (including an annulment or

14 other order of marital dissolution) shall, if the

15 former spouse, within 60 days after the receipt of

16 notice under subparagraph (G)(ii)(I)(bb), so elects,

17 be deemed by the plan to be a domestic relations

18 order that specifies that 50 percent of the marital

19 share of the participant’s accrued benefit is to be

20 provided to such former spouse.

21 ‘‘(II) The marital share shall be the accrued

22 benefit of the participant under the plan as of the

23 date of the first payment under the plan (to the ex24 tent such accrued benefit is vested at the date of the

25 divorce or any later date) multiplied by a fraction,
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1 the numerator of which is the period of participation

2 by the participant under the plan starting with the

3 date of marriage and ending with the date of di4 vorce, and the denominator of which is the total pe5 riod of participation by the participant under the

6 plan.

7 ‘‘(III) Each plan shall establish reasonable rules

8 for determining how any such deemed domestic rela9 tions order is to be interpreted under the plan so as

10 to constitute a qualified domestic relations order

11 that satisfies subparagraphs (C) through (E) (and a

12 copy of such rules shall be provided to such former

13 spouse promptly after delivery of the divorce decree).

14 Such rules—

15 ‘‘(aa) may delay the effect of such an order

16 until the earlier of the date the participant is

17 fully vested or has terminated employment,

18 ‘‘(bb) may allow the former spouse to be

19 paid out immediately,

20 ‘‘(cc) shall permit the spouse to be paid

21 not later than the earliest retirement age under

22 the plan or the participant’s death,

23 ‘‘(dd) may require the submitter of the di24 vorce decree to present a marriage certificate or
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1 other evidence of the marriage date to assist in

2 benefit calculations, and

3 ‘‘(ee) may conform to the rules applicable

4 to qualified domestic relations orders regarding

5 form or type of benefit.

6 ‘‘(IV) This clause shall not apply—

7 ‘‘(aa) if the domestic relations order states

8 that pension benefits were considered by the

9 parties and no division is intended, or

10 ‘‘(bb) to the extent that a qualified domes11 tic relations order issued in connection with

12 such divorce provides otherwise.’’.

13 (2) NOTIFICATION PROCEDURES.—Section

14 206(d)(3)(G) of such Act (29 U.S.C. 1056(d)(3)(G))

15 is amended by striking all matter before clause (ii),

16 by redesignating clause (ii) as clause (iii), and by in17 serting before clause (iii) (as so redesignated) the

18 following:

19 ‘‘(G)(i) In the case of any domestic relations order

20 received by a plan, including such an order received under

21 clause (ii) or section 606(a)(3)—

22 ‘‘(I) within 14 days after receipt of such order,

23 the plan administrator shall—

24 ‘‘(aa) notify the participant and each alter25 nate payee of the receipt of such order and the
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1 plan’s procedures for determining the qualified

2 status of domestic relation orders, and

3 ‘‘(bb) notify the former spouse of such

4 former spouse’s rights under subparagraph

5 (B)(iii), and

6 ‘‘(II) within a reasonable period after receipt of

7 such order, the plan administrator shall determine

8 whether such order is a qualified domestic relations

9 order and notify the participant and each alternate

10 payee of such determination.

11 ‘‘(ii) In the case of a domestic relations order which

12 is not a qualified domestic relations order, each plan—

13 ‘‘(I) shall require that each participant is re14 sponsible for notifying the plan administrator of the

15 occurrence of a divorce of the participant from the

16 former spouse and for delivery to the plan adminis17 trator of the domestic relations order along with the

18 information required by subparagraph (C)(i) within

19 60 days after the date of the divorce, and

20 ‘‘(II) shall allow a former spouse to so notify

21 the plan administrator and deliver to the plan ad22 ministrator the domestic relations order within 60

23 days after the date of the divorce.’’.
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1 SEC. 104. CLARIFICATION OF CONTINUED AVAILABILITY OF

2 REMEDIES RELATING TO MATTERS TREATED

3 IN DOMESTIC RELATIONS ORDERS ENTERED

4 BEFORE 1985.

5 (a) IN GENERAL.—In any case in which—

6 (1) under a prior domestic relations order en7 tered before January 1, 1985, in an action for di8 vorce—

9 (A) the right of a spouse under a pension

10 plan to an accrued benefit under such plan was

11 not divided between spouses,

12 (B) any right of a spouse with respect to

13 such an accrued benefit was waived without the

14 informed consent of such spouse, or

15 (C) the right of a spouse as a participant

16 under a pension plan to an accrued benefit

17 under such plan was divided so that the other

18 spouse received less than such other spouse’s

19 pro rata share of the accrued benefit under the

20 plan, or

21 (2) a court of competent jurisdiction determines

22 that any further action is appropriate with respect

23 to any matter to which a prior domestic relations

24 order entered before such date applies,

25 nothing in the provisions of section 104, 204, or 303 of

26 the Retirement Equity Act of 1984 (Public Law 98–397)
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1 or the amendments made thereby shall be construed to

2 require or permit the treatment, for purposes of such pro3 visions, of a domestic relations order, which is entered on

4 or after the date of the enactment of this Act and which

5 supersedes, amends the terms of, or otherwise affects such

6 prior domestic relations order, as other than a qualified

7 domestic relations order solely because such prior domestic

8 relations order was entered before January 1, 1985.

9 (b) DEFINITIONS.—For purposes of this section—

10 (1) IN GENERAL.—Terms used in this section

11 which are defined in section 3 of the Employee Re12 tirement Income Security Act of 1974 (29 U.S.C.

13 1002) shall have the meanings provided such terms

14 by such section.

15 (2) PRO RATA SHARE.—The term ‘‘pro rata

16 share’’ of a spouse means, in connection with an ac17 crued benefit under a pension plan, 50 percent of

18 the product derived by multiplying—

19 (A) the actuarial present value of the ac20 crued benefit, by

21 (B) a fraction—

22 (i) the numerator of which is the pe23 riod of time, during the marriage between

24 the spouse and the participant in the plan,
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1 which constitutes creditable service by the

2 participant under the plan, and

3 (ii) the denominator of which is the

4 total period of time which constitutes cred5 itable service by the participant under the

6 plan.

7 (3) PLAN.—All pension plans in which a person

8 has been a participant shall be treated as one plan

9 with respect to such person.

10 SEC. 105. ENTITLEMENT OF DIVORCED SPOUSES TO RAIL11 ROAD RETIREMENT ANNUITIES INDEPEND12 ENT OF ACTUAL ENTITLEMENT OF EM13 PLOYEE.

14 Section 2 of the Railroad Retirement Act of 1974 (45

15 U.S.C. 231a) is amended—

16 (1) in subsection (c)(4)(i), by striking ‘‘(A) is

17 entitled to an annuity under subsection (a)(1) and

18 (B)’’; and

19 (2) in subsection (e)(5), by striking ‘‘or di20 vorced wife’’ the second place it appears.

21 SEC. 106. EFFECTIVE DATES.

22 (a) IN GENERAL.—Except as provided in subsection

23 (b), the amendments made by this title, other than section

24 101, shall apply with respect to plan years beginning on

25 or after January 1, 1998, and the amendments made by
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1 section 103 shall apply only with respect to divorces be2 coming final in such plan years.

3 (b) SPECIAL RULE FOR COLLECTIVELY BARGAINED

4 PLANS.—In the case of a plan maintained pursuant to 1

5 or more collective bargaining agreements between em6 ployee representatives and 1 or more employers ratified

7 on or before the date of the enactment of this Act, sub8 section (a) shall be applied to benefits pursuant to, and

9 individuals covered by, any such agreement by substituting

10 for ‘‘January 1, 1998’’ the date of the commencement of

11 the first plan year beginning on or after the earlier of—

12 (1) the later of—

13 (A) January 1, 1999, or

14 (B) the date on which the last of such col15 lective bargaining agreements terminates (de16 termined without regard to any extension there17 of after the date of the enactment of this Act),

18 or

19 (2) January 1, 2000.

20 (c) PLAN AMENDMENTS.—If any amendment made

21 by this title requires an amendment to any plan, such plan

22 amendment shall not be required to be made before the

23 first plan year beginning on or after January 1, 2000, if—

24 (1) during the period after such amendment

25 made by this title takes effect and before such first
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1 plan year, the plan is operated in accordance with

2 the requirements of such amendment made by this

3 title, and

4 (2) such plan amendment applies retroactively

5 to the period after such amendment made by this

6 title takes effect and such first plan year.

7 A plan shall not be treated as failing to provide definitely

8 determinable benefits or contributions, or to be operated

9 in accordance with the provisions of the plan, merely be10 cause it operates in accordance with this subsection.

11 TITLE II—PROTECTION OF

12 RIGHTS OF FORMER SPOUSES

13 TO PENSION BENEFITS

14 UNDER CERTAIN GOVERN15 MENT AND GOVERNMENT16 SPONSORED RETIREMENT

17 PROGRAMS

18 SEC. 201. EXTENSION OF TIER II RAILROAD RETIREMENT

19 BENEFITS TO SURVIVING FORMER SPOUSES

20 PURSUANT TO DIVORCE AGREEMENTS.

21 (a) IN GENERAL.—Section 5 of the Railroad Retire22 ment Act of 1974 (45 U.S.C. 231d) is amended by adding

23 at the end the following new subsection:
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1 ‘‘(d) Notwithstanding any other provision of law, the

2 payment of any portion of an annuity computed under sec3 tion 3(b) to a surviving former spouse in accordance with

4 a court decree of divorce, annulment, or legal separation

5 or the terms of any court-approved property settlement

6 incident to any such court decree shall not be terminated

7 upon the death of the individual who performed the service

8 with respect to which such annuity is so computed unless

9 such termination is otherwise required by the terms of

10 such court decree.’’.

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

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

13 of this Act.

14 SEC. 202. SURVIVOR ANNUITIES FOR WIDOWS, WIDOWERS,

15 AND FORMER SPOUSES OF FEDERAL EM16 PLOYEES WHO DIE BEFORE ATTAINING AGE

17 FOR DEFERRED ANNUITY UNDER CIVIL

18 SERVICE RETIREMENT SYSTEM.

19 (a) BENEFITS FOR WIDOW OR WIDOWER.—Section

20 8341(f) of title 5, United States Code, is amended—

21 (1) in the matter preceding paragraph (1) by—
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1 (A) by inserting ‘‘a former employee sepa2 rated from the service with title to deferred an3 nuity from the Fund dies before having estab4 lished a valid claim for annuity and is survived

5 by a spouse, or if’’ before ‘‘a Member’’; and

6 (B) by inserting ‘‘of such former employee

7 or Member’’ after ‘‘the surviving spouse’’;

8 (2) in paragraph (1)—

9 (A) by inserting ‘‘former employee or’’ be10 fore ‘‘Member commencing’’; and

11 (B) by inserting ‘‘former employee or’’ be12 fore ‘‘Member dies’’; and

13 (3) in the undesignated sentence following para14 graph (2)—

15 (A) in the matter preceding subparagraph

16 (A) by inserting ‘‘former employee or’’ before

17 ‘‘Member’’; and

18 (B) in subparagraph (B) by inserting

19 ‘‘former employee or’’ before ‘‘Member’’.

20 (b) BENEFITS FOR FORMER SPOUSE.—Section

21 8341(h) of title 5, United States Code, is amended—

22 (1) in paragraph (1) by adding after the first

23 sentence ‘‘Subject to paragraphs (2) through (5) of

24 this subsection, a former spouse of a former em25 ployee who dies after having separated from the
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1 service with title to a deferred annuity under section

2 8338(a) but before having established a valid claim

3 for annuity is entitled to a survivor annuity under

4 this subsection, if and to the extent expressly pro5 vided for in an election under section 8339(j)(3) of

6 this title, or in the terms of any decree of divorce

7 or annulment or any court order or court-approved

8 property settlement agreement incident to such de9 cree.’’; and

10 (2) in paragraph (2)—

11 (A) in subparagraph (A)(ii) by striking ‘‘or

12 annuitant,’’ and inserting ‘‘annuitant, or former

13 employee’’; and

14 (B) in subparagraph (B)(iii) by inserting

15 ‘‘former employee or’’ before ‘‘Member’’.

16 (c) PROTECTION OF SURVIVOR BENEFIT RIGHTS.—

17 Section 8339(j)(3) of title 5, United States Code, is

18 amended by inserting at the end the following:

19 ‘‘The Office shall provide by regulation for the appli20 cation of this subsection to the widow, widower, or surviv21 ing former spouse of a former employee who dies after

22 having separated from the service with title to a deferred

23 annuity under section 8338(a) but before having estab24 lished a valid claim for annuity.’’.
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1 (d) EFFECTIVE DATE.—The amendments made by

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

3 of this Act and shall apply only in the case of a former

4 employee who dies on or after such date.

5 SEC. 203. COURT ORDERS RELATING TO FEDERAL RETIRE6 MENT BENEFITS FOR FORMER SPOUSES OF

7 FEDERAL EMPLOYEES.

8 (a) CIVIL SERVICE RETIREMENT SYSTEM.—

9 (1) IN GENERAL.—Section 8345(j) of title 5,

10 United States Code, is amended—

11 (A) by redesignating paragraph (3) as

12 paragraph (4); and

13 (B) by inserting after paragraph (2) the

14 following new paragraph:

15 ‘‘(3) Payment to a person under a court decree, court

16 order, property settlement, or similar process referred to

17 under paragraph (1) shall include payment to a former

18 spouse of the employee, Member, or annuitant.’’.

19 (2) LUMP-SUM BENEFITS.—Section 8342 of

20 title 5, United States Code, is amended—

21 (A) in subsection (c) by striking ‘‘Lump22 sum benefits’’ and inserting ‘‘Subject to sub23 section (j), lump-sum benefits’’; and

24 (B) in subsection (j)(1) by striking ‘‘the

25 lump-sum credit under subsection (a) of this
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1 section’’ and inserting ‘‘any lump-sum credit or

2 lump-sum benefit under this section’’.

3 (b) FEDERAL EMPLOYEES RETIREMENT SYSTEM.—

4 Section 8467 of title 5, United States Code, is amended—

5 (1) by redesignating subsection (c) as sub6 section (d); and

7 (2) by inserting after subsection (b) the follow8 ing new subsection:

9 ‘‘(c) Payment to a person under a court decree, court

10 order, property settlement, or similar process referred to

11 under subsection (a) shall include payment to a former

12 spouse of the employee, Member, or annuitant.’’.

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

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

15 of this Act.

16 TITLE III—REFORMS RELATED

17 TO 401(K) PLANS

18 SEC. 301. REQUIREMENT OF ANNUAL, DETAILED INVEST19 MENT REPORTS APPLIED TO CERTAIN 401(k)

20 PLANS.

21 (a) IN GENERAL.—Section 104(b)(3) of the Em22 ployee Retirement Income Security Act of 1974 (29

23 U.S.C. 1024(b)(3)) is amended—

24 (1) by inserting ‘‘(A)’’ after ‘‘(3)’’; and
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1 (2) by adding at the end the following new sub2 paragraph:

3 ‘‘(B)(i) If a plan includes a qualified cash or

4 deferred arrangement (as defined in section

5 401(k)(2) of the Internal Revenue Code of 1986)

6 and is maintained by an employer with less than 100

7 participants, the administrators shall furnish to each

8 participant and to each beneficiary receiving benefits

9 under the plan an annual investment report detail10 ing such information as the Secretary by regulation

11 shall require.

12 ‘‘(ii) Clause (i) shall not apply with respect to

13 any participant described in section 404(c).’’.

14 (b) REGULATIONS.—

15 (1) IN GENERAL.—The Secretary of Labor, in

16 prescribing regulations required under section

17 104(b)(3)(B)(i) of the Employee Retirement Income

18 Security Act of 1974 (29 U.S.C. 1023(b)(3)(B)(i)),

19 as added by subsection (a), shall consider including

20 in the information required in an annual investment

21 report the following:

22 (A) Total plan assets and liabilities as of

23 the beginning and ending of the plan year.
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1 (B) Plan income and expenses and con2 tributions made and benefits paid for the plan

3 year.

4 (C) Any transaction between the plan and

5 the employer, any fiduciary, or any 10-percent

6 owner during the plan year, including the acqui7 sition of any employer security or employer real

8 property.

9 (D) Any noncash contributions made to or

10 purchases of nonpublicly traded securities made

11 by the plan during the plan year without an ap12 praisal by an independent third party.

13 (2) ELECTRONIC TRANSFER.—The Secretary of

14 Labor in prescribing such regulations shall also

15 make provision for the electronic transfer of the re16 quired annual investment report by a plan adminis17 trator to plan participants and beneficiaries.

18 (c) EFFECTIVE DATE.—The amendment made by

19 subsection (a) shall apply to plan years beginning after

20 the date of the enactment of this Act.

21 SEC. 302. SECTION 401(k) INVESTMENT PROTECTION.

22 (a) LIMITATIONS ON INVESTMENT IN EMPLOYER SE23 CURITIES AND EMPLOYER REAL PROPERTY BY CASH OR

24 DEFERRED ARRANGEMENTS.—Paragraph (3) of section

25 407(d) of the Employee Retirement Income Security Act
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1 of 1974 (29 U.S.C. 1107(d)) is amended by adding at the

2 end the following new subparagraph:

3 ‘‘(D) The term ‘eligible individual account plan’

4 does not include that portion of an individual ac5 count plan that consists of elective deferrals (as de6 fined in section 402(g)(3) of the Internal Revenue

7 Code of 1986) pursuant to a qualified cash or de8 ferred arrangement as defined in section 401(k) of

9 the Internal Revenue Code of 1986 (and earnings

10 thereon), if such elective deferrals (or earnings

11 thereon) are required to be invested in qualifying

12 employer securities or qualifying employer real prop13 erty or both pursuant to the documents and instru14 ments governing the plan or at the direction of a

15 person other than the participant (or the partici16 pant’s beneficiary) on whose behalf such elective de17 ferrals are made to the plan. For the purposes of

18 subsection (a), such portion shall be treated as a

19 separate plan. This subparagraph shall not apply to

20 an individual account plan if the fair market value

21 of the assets of all individual account plans main22 tained by the employer equals not more than 10 per23 cent of the fair market value of the assets of all pen24 sion plans maintained by the employer.’’.

25 (b) EFFECTIVE DATE.—
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1 (1) IN GENERAL.—The amendments made by

2 this section shall take effect on the date of the en3 actment of this Act.

4 (2) TRANSITION RULE FOR PLANS HOLDING

5 EXCESS SECURITIES OR PROPERTY.—

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

7 which on the date of the enactment of this Act,

8 has holdings of employer securities and em9 ployer real property (as defined in section

10 407(d) of the Employee Retirement Income Se11 curity Act of 1974 (29 U.S.C. 1107(d)) in ex12 cess of the amount specified in such section

13 407, the amendment made by this section ap14 plies to any acquisition of such securities and

15 property on or after such date, but does not

16 apply to the specific holdings which constitute

17 such excess during the period of such excess.

18 (B) SPECIAL RULE FOR CERTAIN ACQUISI19 TIONS.—Employer securities and employer real

20 property acquired pursuant to a binding written

21 contract to acquire such securities and real

22 property entered into and in effect on the date

23 of the enactment of this Act, shall be treated as

24 acquired immediately before such date.
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1 TITLE IV—MODIFICATIONS OF

2 JOINT AND SURVIVOR ANNU3 ITY REQUIREMENTS

4 SEC. 401. MODIFICATIONS OF JOINT AND SURVIVOR ANNU5 ITY REQUIREMENTS.

6 (a) AMENDMENTS TO ERISA.—

7 (1) AMOUNT OF ANNUITY.—

8 (A) IN GENERAL.—Paragraph (1) of sec9 tion 205(a) of the Employee Retirement Income

10 Security Act of 1974 (29 U.S.C. 1055(a)) is

11 amended by inserting ‘‘or, at the election of the

12 participant, shall be provided in the form of a

qualified joint and 2 13 ⁄3 survivor annuity’’ after

14 ‘‘survivor annuity,’’.

15 (B) DEFINITION.—Subsection (d) of sec16 tion 205 of such Act (29 U.S.C. 1055) is

17 amended—

18 (i) by redesignating paragraphs (1)

19 and (2) as subparagraphs (A) and (B), re20 spectively,

21 (ii) by inserting ‘‘(1)’’ after ‘‘(d)’’,

22 and

23 (iii) by adding at the end the follow24 ing new paragraph:
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1 ‘‘(2) For purposes of this section, the term ‘‘qualified

joint and 2 2 ⁄3 survivor annuity’’ means an annuity—

3 ‘‘(A) for the participant while both the partici4 pant and the spouse are alive with a survivor annu5 ity for the life of surviving individual (either the par6 ticipant or the spouse) equal to 67 percent of the

7 amount of the annuity which is payable to the par8 ticipant while both the participant and the spouse

9 are alive,

10 ‘‘(B) which is the actuarial equivalent of a sin11 gle annuity for the life of the participant, and

12 ‘‘(C) which, for all other purposes of this Act,

13 is treated as a qualified joint and survivor annuity.’’.

14 (2) ILLUSTRATION REQUIREMENT.—Clause (i)

15 of section 205(c)(3)(A) of such Act (29 U.S.C.

16 1055(c)(3)(A)) is amended to read as follows:

17 ‘‘(i) the terms and conditions of each qualified

18 joint and survivor annuity and qualified joint and

2 19 ⁄3 survivor annuity offered, accompanied by an illus20 tration of the benefits under each such annuity for

21 the particular participant and spouse and an ac22 knowledgement form to be signed by the participant

23 and the spouse that they have read and considered

24 the illustration before any form of retirement benefit

25 is chosen,’’.
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1 (b) AMENDMENTS TO INTERNAL REVENUE CODE.—

2 (1) AMOUNT OF ANNUITY.—

3 (A) IN GENERAL.—Clause (i) of section

4 401(a)(11)(A) of the Internal Revenue Code of

5 1986 (relating to requirement of joint and sur6 vivor annuity and preretirement survivor annu7 ity) is amended by inserting ‘‘or, at the election

8 of the participant, shall be provided in the form

of a qualified joint and 2 9 ⁄3 survivor annuity’’

10 after ‘‘survivor annuity,’’.

11 (B) DEFINITION.—Section 417 of such

12 Code (relating to definitions and special rules

13 for purposes of minimum survivor annuity re14 quirements) is amended by redesignating sub15 section (f) as subsection (g) and by inserting

16 after subsection (e) the following new sub17 section:

‘‘(f) DEFINITION OF QUALIFIED JOINT AND 2 18 ⁄3 SUR19 VIVOR ANNUITY.—For purposes of this section and section

401(a)(11), the term ‘‘qualified joint and 2 20 ⁄3 survivor an21 nuity’’ means an annuity—

22 ‘‘(1) for the participant while both the partici23 pant and the spouse are alive with a survivor annu24 ity for the life of surviving individual (either the par25 ticipant or the spouse) equal to 67 percent of the
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1 amount of the annuity which is payable to the par2 ticipant while both the participant and the spouse

3 are alive,

4 ‘‘(2) which is the actuarial equivalent of a sin5 gle annuity for the life of the participant, and

6 ‘‘(3) which, for all other purposes of this title,

7 is treated as a qualified joint and survivor annuity.’’.

8 (2) ILLUSTRATION REQUIREMENT.—Clause (i)

9 of section 417(a)(3)(A) of such Code (relating to ex10 planation of joint and survivor annuity) is amended

11 to read as follows:

12 ‘‘(i) the terms and conditions of each

13 qualified joint and survivor annuity and

qualified joint and 2 14 ⁄3 survivor annuity of15 fered, accompanied by an illustration of

16 the benefits under each such annuity for

17 the particular participant and spouse and

18 an acknowledgement form to be signed by

19 the participant and the spouse that they

20 have read and considered the illustration

21 before any form of retirement benefit is

22 chosen,’’.

23 (c) EFFECTIVE DATES.—
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1 (1) IN GENERAL.—The amendments made by

2 this section shall apply to plan years beginning on

3 or after January 1, 1998.

4 (2) SPECIAL RULE FOR COLLECTIVELY BAR5 GAINED PLANS.—In the case of a plan maintained

6 pursuant to 1 or more collective bargaining agree7 ments between employee representatives and 1 or

8 more employers ratified on or before the date of en9 actment of this Act, the amendments made by this

10 section shall apply to the first plan year beginning

11 on or after the earlier of—

12 (A) the later of—

13 (i) January 1, 1999, or

14 (ii) the date on which the last of such

15 collective bargaining agreements termi16 nates (determined without regard to any

17 extension thereof after the date of enact18 ment of this Act), or

19 (B) January 1, 2000.

20 (3) PLAN AMENDMENTS.—If any amendment

21 made by this section requires an amendment to any

22 plan, such plan amendment shall not be required to

23 be made before the first plan year beginning on or

24 after January 1, 2000, if—
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1 (A) during the period after such amend2 ment made by this section takes effect and be3 fore such first plan year, the plan is operated

4 in accordance with the requirements of such

5 amendment made by this section, and

6 (B) such plan amendment applies retro7 actively to the period after such amendment

8 made by this section takes effect and such first

9 plan year.

10 A plan shall not be treated as failing to provide defi11 nitely determinable benefits or contributions, or to

12 be operated in accordance with the provisions of the

13 plan, merely because it operates in accordance with

14 this paragraph.

15 TITLE V—SPOUSAL CONSENT

16 REQUIRED FOR DISTRIBU17 TIONS FROM SECTION 401(k)

18 PLANS

19 SEC. 501. SPOUSAL CONSENT REQUIRED FOR DISTRIBU20 TIONS FROM SECTION 401(k) PLANS.

21 (a) IN GENERAL.—Paragraph (2) of section 401(k)

22 of the Internal Revenue Code of 1986 (defining qualified

23 cash or deferred arrangement) is amended by striking
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1 ‘‘and’’ at the end of subparagraph (C), by striking the pe2 riod at the end of subparagraph (D) and inserting ‘‘, and’’,

3 and by adding at the end the following new subparagraph:

4 ‘‘(E) which provides that no distribution

5 may be made unless—

6 ‘‘(i) the spouse of the employee (if

7 any) consents in writing (during the 90-

8 day period ending on the date of the dis9 tribution) to such distribution, and

10 ‘‘(ii) requirements comparable to the

11 requirements of section 417(a)(2) are met

12 with respect to such consent.’’

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

14 this section shall apply to distributions in plan years be15 ginning on or after January 1, 1998.

16 TITLE VI—WOMEN’S PENSION

17 TOLL-FREE PHONE NUMBER

18 SEC. 601. WOMEN’S PENSION TOLL-FREE PHONE NUMBER.

19 (a) IN GENERAL.—The Secretary of Labor shall con20 tract with an independent organization to create a wom21 en’s pension toll-free telephone number and contact to

22 serve as—

23 (1) a resource for women on pension questions

24 and issues;
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1 (2) a source for referrals to appropriate agen2 cies; and

3 (3) a source for printed information.

4 (b) AUTHORIZATION OF APPROPRIATIONS.—There

5 are authorized to be appropriated $500,000 for each of

6 the fiscal years 1998, 1999, 2000, and 2001 to carry out

7 subsection (a).

8 TITLE VII—PERIODIC PENSION

9 BENEFITS STATEMENTS

10 SEC. 701. PERIODIC PENSION BENEFITS STATEMENTS.

11 (a) IN GENERAL.—Subsection (a) of section 105 of

12 the Employee Retirement Income Security Act of 1974

13 (29 U.S.C. 1025) is amended by striking ‘‘shall furnish

14 to any plan participant or beneficiary who so requests in

15 writing,’’ and inserting ‘‘shall furnish at least once every

16 3 years, in the case of a defined benefit plan, and annu17 ally, in the case of a defined contribution plan, to each

18 plan participant, and shall furnish to any plan participant

19 or beneficiary who so requests,’’.

20 (b) RULE FOR MULTIEMPLOYER PLANS.—Subsection

21 (d) of section 105 of the Employee Retirement Income Se22 curity Act of 1974 (29 U.S.C. 1025) is amended to read

23 as follows:
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1 ‘‘(d) Each administrator of a plan to which more than

2 1 unaffiliated employer is required to contribute shall fur3 nish to any plan participant or beneficiary who so requests

4 in writing, a statement described in subsection (a).’’.

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

6 this section shall apply to plan years beginning after the

7 earlier of—

8 (1) the date of issuance by the Secretary of

9 Labor of regulations providing guidance for simplify10 ing defined benefit plan calculations with respect to

11 the information required under section 105 of the

12 Employee Retirement Income Security Act of 1974

13 (29 U.S.C. 1025), or

14 (2) December 31, 1997.

Æ