II 

111TH CONGRESS 

2D SESSION S. 3157 

To amend the Employee Retirement Income Security Act of 1974 and the 

Internal Revenue Code of 1986 to allow time for pensions to fund 

benefit obligations in light of economic circumstances in the financial 

markets of 2008, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 23, 2010 

Mr. CASEY (for himself, Mr. BROWN of Ohio, Ms. STABENOW, and Mr. 

BURRIS) introduced the following bill; which was read twice and referred 

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

A BILL 

To amend the Employee Retirement Income Security Act 

of 1974 and the Internal Revenue Code of 1986 to 

allow time for pensions to fund benefit obligations in 

light of economic circumstances in the financial markets 

of 2008, and for other purposes. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Create Jobs and Save 

5 Benefits Act of 2010’’. 

6 SEC. 2. MULTIEMPLOYER PLAN MERGERS AND ALLIANCES. 

7 (a) MULTIEMPLOYER PLAN ALLIANCES.— 


dcolon on DSK2BSOYB1PROD with BILLS
2 

•S 3157 IS

1 (1) AMENDMENTS TO ERISA.— 

2 (A) Section 4231 of the Employee Retire3 ment Income Security Act of 1974 is amended 

4 by adding at the end the following new sub5 section: 

6 ‘‘(e) MULTIEMPLOYER PLAN ALLIANCES.— 

7 ‘‘(1) IN GENERAL.—The plan sponsor of a mul8 tiemployer plan into which another multiemployer 

9 plan (referred to in this subsection as the ‘allied 

10 plan’) has been merged in accordance with this sec11 tion may designate the merger as an alliance to 

12 which the rules of this subsection apply by amending 

13 such sponsor’s plan— 

14 ‘‘(A) to identify the allied plan, and 

15 ‘‘(B) to delineate the terms of operation of 

16 the alliance, including the allocation of em17 ployer contributions and experience gains and 

18 losses between the merged plan and the frozen 

19 allied plan. 

20 ‘‘(2) APPLICABLE PROVISIONS.—Except to the 

21 extent otherwise provided in the plan amendment 

22 under paragraph (1), sections 302, 304, and 305, 

23 part 1 of subtitle E, sections 4244A and 4281, part 

24 3 of subtitle E, and section 4261 shall apply to the 


dcolon on DSK2BSOYB1PROD with BILLS
3 

•S 3157 IS

1 frozen allied plan and the plan into which the allied 

2 plan was merged as if they were separate plans. 

3 ‘‘(3) FROZEN ALLIED PLAN.— 

4 ‘‘(A) IN GENERAL.—The term ‘frozen al5 lied plan’ means a plan— 

6 ‘‘(i) which comprises the assets and li7 abilities of the allied plan as if it had been 

8 amended, effective immediately before the 

9 effective date of the merger, to cease all 

10 benefit accruals, and 

11 ‘‘(ii) which is treated in part as a sep12 arate plan from the merged plan, as pro13 vided in subparagraphs (B) and (C) and 

14 paragraph (2). 

15 ‘‘(B) EMPLOYERS MAINTAINING PLAN.— 

16 The employers that were obligated to contribute 

17 to the allied plan immediately before the effec18 tive date of the merger, and any successors 

19 thereto whether by sale, reorganization, or oth20 erwise, shall be considered to be the employers 

21 maintaining the frozen allied plan to the extent 

22 they continue to have an obligation to con23 tribute with respect to participants or facilities 

24 covered by the allied plan before such effective 

25 date. 


dcolon on DSK2BSOYB1PROD with BILLS
4 

•S 3157 IS

1 ‘‘(C) PARTICIPANTS AND BENE2 FICIARIES.—The participants and beneficiaries 

3 of the allied plan immediately before the effec4 tive date of the merger shall be considered to 

5 be the participants and beneficiaries of the fro6 zen allied plan on and after such date. 

7 ‘‘(4) TREATMENT OF MERGED PLAN AS SINGLE

8 PLAN.—Except as provided in paragraphs (2) and 

9 (3), the allied plan and the plan into which it has 

10 been merged shall be treated as a single plan. 

11 ‘‘(5) OTHER RULES.— 

12 ‘‘(A) ADOPTION OF INITIAL PLAN AMEND13 MENT.—The plan amendment initially desig14 nating a merger as an alliance, identifying the 

15 allied plan, and delineating the terms of the al16 liance must be adopted by no later than the last 

17 day of the plan year in which the merger takes 

18 effect. 

19 ‘‘(B) SUBSEQUENT AMENDMENTS.—The 

20 initial plan amendment described in subpara21 graph (A) may subsequently be modified or re22 pealed, except that the plan shall give notice of 

23 any such change to the employers and partici24 pants with respect to the allied plan at least 15 


dcolon on DSK2BSOYB1PROD with BILLS
5 

•S 3157 IS

1 days before such subsequent amendment takes 

2 effect. 

3 ‘‘(C) DISCRETION TO TREAT MERGERS

4 DIFFERENTLY.—The plan sponsor of a multi5 employer plan may, in its discretion, treat some 

6 mergers as alliances and others as full mergers, 

7 and may prescribe different terms of operation 

8 for different alliances, if the basis for such dis9 parate treatment is not unreasonable.’’. 

10 (B) Subsection (b) of section 4231 of such 

11 Act is amended by striking ‘‘and’’ at the end of 

12 paragraph (3), by striking the period at the end 

13 of paragraph (4) and inserting ‘‘; and’’, and by 

14 adding at the end the following new paragraph: 

15 ‘‘(5) a merger that is designated as an alliance 

16 under subsection (e) shall not be treated as failing 

17 to meet any of the criteria of this subsection solely 

18 because benefits under the allied plan are, or are ex19 pected to be, reduced or eliminated pursuant to sec20 tion 305 as a result of the endangered or critical 

21 status of the frozen allied plan.’’. 

22 (C) Section 404(a) of such Act is amended 

23 by adding at the end the following new para24 graph: 


dcolon on DSK2BSOYB1PROD with BILLS
6 

•S 3157 IS

1 ‘‘(3) With respect to a merger of multiemployer 

2 plans, including a merger that is designated as an 

3 alliance under section 4231(e), the plan sponsors of 

4 a plan which is merging with another plan shall be 

5 considered to meet the requirements of paragraph 

6 (1)(A) if such plan sponsors determine that the 

7 merger is not reasonably likely to be adverse to the 

8 long-term interests of the participants and bene9 ficiaries of the plan for which such plan sponsors are 

10 responsible prior to such merger.’’. 

11 (D) Section 4231(c) of such Act is amend12 ed by striking ‘‘The merger of multiemployer 

13 plans or the transfer’’ and inserting ‘‘The 

14 merger of multiemployer plans, including a 

15 merger that is designated as an alliance, or the 

16 transfer’’. 

17 (2) AMENDMENT TO INTERNAL REVENUE CODE

18 OF 1986.—Section 412 of the Internal Revenue Code 

19 of 1986 is amended by adding at the end the fol20 lowing new subsection: 

21 ‘‘(f) MULTIEMPLOYER PLAN ALLIANCES.— 

22 ‘‘(1) IN GENERAL.—Except to the extent other23 wise provided in the plan amendment under section 

24 4231(e)(1) of the Employee Retirement Income Se25 curity Act of 1974 designating a multiemployer plan 


dcolon on DSK2BSOYB1PROD with BILLS
7 

•S 3157 IS

1 merger as an alliance, this section and sections 431 

2 and 432 shall apply to the frozen allied plan and the 

3 plan into which the allied plan was merged as if they 

4 were separate plans. 

5 ‘‘(2) EMPLOYERS MAINTAINING PLAN.—The 

6 employers that were obligated to contribute to the 

7 allied plan immediately before the effective date of 

8 the merger, and any successors thereto whether by 

9 sale, reorganization, or otherwise, shall be considered 

10 to be the employers maintaining the frozen allied 

11 plan to the extent they continue to have an obliga12 tion to contribute with respect to participants or fa13 cilities covered by the allied plan before such effec14 tive date. 

15 ‘‘(3) PARTICIPANTS AND BENEFICIARIES.—The 

16 participants and beneficiaries of the allied plan im17 mediately before the effective date of the merger 

18 shall be considered to be the participants and bene19 ficiaries of the frozen allied plan on and after such 

20 date. 

21 ‘‘(4) TREATMENT OF MERGED PLAN AS SINGLE

22 PLAN.—Except as provided in paragraphs (2) and 

23 (3) of section 4231(e) of the Employee Retirement 

24 Income Security Act of 1974, the allied plan and the 


dcolon on DSK2BSOYB1PROD with BILLS
8 

•S 3157 IS

1 plan into which it has been merged shall be treated 

2 as a single plan. 

3 ‘‘(5) ALLIANCE; ALLIED PLAN; FROZEN ALLIED

4 PLAN.—For purposes of this subsection, the terms 

5 ‘alliance’, ‘allied plan’, and ‘frozen allied plan’ shall 

6 have the same meanings as when used in section 

7 4231(e) of the Employee Retirement Income Secu8 rity Act of 1974.’’. 

9 (b) PBGC ASSISTANCE FOR MULTIEMPLOYER PLAN

10 MERGERS.—Section 4231 of the Employee Retirement In11 come Security Act of 1974, as amended by subsection (a), 

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

14 ‘‘(f) FACILITATED MERGERS.— 

15 ‘‘(1) IN GENERAL.—When requested to do so 

16 by the plan sponsors, the corporation shall take rea17 sonable actions to promote and facilitate the merger 

18 of two or more multiemployer plans, including a 

19 merger that is designated as an alliance under sub20 section (e), if it determines that the transaction is 

21 in the interests of the participants and beneficiaries 

22 of at least one of the plans and is not reasonably ex23 pected to be adverse to the long-term interests of the 

24 participants and beneficiaries of the other plan or 

25 plans. Such facilitation may include training, techVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
9 

•S 3157 IS

1 nical assistance, mediation, communication with 

2 stakeholders, and support with related requests to 

3 other government agencies. 

4 ‘‘(2) FINANCIAL ASSISTANCE.—In order to fa5 cilitate a merger, including a merger designated as 

6 an alliance under subsection (e), which it determines 

7 is reasonably necessary to enable one or more of the 

8 plans involved to avoid or postpone insolvency, the 

9 corporation may provide financial assistance to the 

10 merged plan if it reasonably expects that such finan11 cial assistance will reduce the corporation’s likely 

12 long-term loss with respect to the plans involved.’’. 

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

14 this section shall take effect as of the first day of the first 

15 plan year beginning on or after January 1, 2009. 

16 SEC. 3. STRENGTHENING PARTICIPANTS’ BENEFIT PRO17 TECTIONS. 

18 (a) INCREASE IN MULTIEMPLOYER BENEFIT GUAR19 ANTEE.—Paragraph (1) of section 4022A(c) of the Em20 ployee Retirement Income Security Act of 1974 is amend21 ed to read as follows: 

22 ‘‘(c)(1) Except as provided in subsection (g), the 

23 monthly benefit of a participant or a beneficiary which is 

24 guaranteed under this section by the corporation with reVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
10 

•S 3157 IS

1 spect to a plan is the product of the number of the partici2 pant’s years of credited service multiplied by the sum of— 

3 ‘‘(A) 100 percent of the accrual rate up to $11, 

4 plus 75 percent of the lesser of— 

5 ‘‘(i) $33, or 

6 ‘‘(ii) the accrual rate, if any, in excess of 

7 $11, and 

8 ‘‘(B) 50 percent of the lesser of— 

9 ‘‘(i) $40 or 

10 ‘‘(ii) the accrual rate, if any, in excess of 

11 $44.’’. 

12 (b) INCREASE IN ANNUAL PREMIUM RATE PAY13 ABLE.—Subparagraph (A) of section 4006(a)(3) of the 

14 Employee Retirement Income Security Act of 1974 is 

15 amended— 

16 (1) by inserting ‘‘and before January 1, 2011,’’ 

17 after ‘‘December 31, 2005,’’ in clause (iv), 

18 (2) by striking ‘‘or’’ at the end of clause (iii), 

19 (3) by striking the period at the end of clause 

20 (iv) and inserting ‘‘, or’’, and 

21 (4) by adding at the end the following new 

22 clause: 

23 ‘‘(v) in the case of a multiemployer 

24 plan, for plan years beginning after De25 cember 31, 2010, $16.00 for each indiVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
11 

•S 3157 IS

1 vidual who is a participant in such plan 

2 during the applicable plan year.’’. 

3 (c) CERTAIN PARTITIONS OF ELIGIBLE MULTIEM4 PLOYER PLANS.— 

5 (1) PARTITIONS.—Section 4233 of the Em6 ployee Retirement Income Security Act of 1974 is 

7 amended by adding at the end the following new 

8 subsection: 

9 ‘‘(g) INTERIM PARTITION OF ELIGIBLE MULTIEM10 PLOYER PLANS.— 

11 ‘‘(1) IN GENERAL.—Notwithstanding the pre12 ceding subsections, if, within the 180-day period be13 ginning on the first day of the first plan year begin14 ning after the date of the enactment of the Create 

15 Jobs and Save Benefits Act of 2010, the plan spon16 sor of an eligible multiemployer plan provides to the 

17 corporation written notice that such plan elects a 

18 partition under this subsection, the corporation shall 

19 order a partition of such plan. A partition ordered 

20 under the preceding sentence shall be effective on 

21 the first day of the calendar month designated by 

22 the corporation which is after September 2011 and 

23 before March 2012. The written notice required by 

24 the first sentence of this paragraph shall include the 

25 certifications described in paragraph (2) and a list, 


dcolon on DSK2BSOYB1PROD with BILLS
12 

•S 3157 IS

1 certified by the plan sponsor, of eligible partition 

2 employers. 

3 ‘‘(2) ELIGIBLE MULTIEMPLOYER PLAN.—An el4 igible multiemployer plan is a multiemployer plan as 

5 to which— 

6 ‘‘(A) the plan actuary has certified pursu7 ant to section 305(b) that the plan is in critical 

8 status (within the meaning of section 

9 305(b)(2)) for the plan year in which the notice 

10 described in paragraph (1) is provided to the 

11 corporation, and the plan sponsor has certified, 

12 consistent with projections provided by the plan 

13 actuary, that— 

14 ‘‘(i) a substantial reduction in the 

15 amount of aggregate contributions under 

16 the plan has resulted or will result— 

17 ‘‘(I) from cases or proceedings 

18 under title 11, United States Code, 

19 with respect to employers which were 

20 participating in the plan, or 

21 ‘‘(II) from the complete with22 drawal of employers from the plan 

23 without payment of the full amount of 

24 such employers’ allocable amount of 


dcolon on DSK2BSOYB1PROD with BILLS
13 

•S 3157 IS

1 unfunded vested benefits under sec2 tion 4211, 

3 as compared to the amount of aggregate 

4 contributions that would have been made 

5 under the plan but for such cases or pro6 ceedings, 

7 ‘‘(ii) the plan is likely to become insol8 vent, 

9 ‘‘(iii) contributions under the plan will 

10 have to be significantly increased to pre11 vent the plan from becoming insolvent, 

12 ‘‘(iv) as of the last day of each of the 

13 2 plan years immediately preceding the 

14 plan year in which the notice described in 

15 paragraph (1) is provided to the corpora16 tion— 

17 ‘‘(I) the ratio of the number of 

18 retirees, beneficiaries of deceased par19 ticipants, and terminated vested par20 ticipants in the plan to the number of 

21 the active participants in the plan for 

22 each such year was not less than 2 to 

23 1, and 

24 ‘‘(II) the ratio of benefit pay25 ments made by the plan for each such 


dcolon on DSK2BSOYB1PROD with BILLS
14 

•S 3157 IS

1 year to contributions required to be 

2 made to the plan under section 304 or 

3 305(e), whichever is applicable, for 

4 each such year was not less than 2 to 

5 1, and 

6 ‘‘(v) partition would significantly re7 duce the likelihood that the plan will be8 come insolvent, or 

9 ‘‘(B) the plan actuary has certified pursu10 ant to section 305(b) that the plan is in endan11 gered status (within the meaning of section 

12 305(b)(1)) for the plan year in which the notice 

13 described in paragraph (1) is provided to the 

14 corporation, and the plan sponsor has certified, 

15 consistent with projections provided by the plan 

16 actuary, that— 

17 ‘‘(i) clauses (i), (ii), (iii), and (v) of 

18 subparagraph (A) apply to the plan, 

19 ‘‘(ii) as of the last day of each of the 

20 2 plan years immediately preceding the 

21 plan year in which the notice described in 

22 paragraph (1) is provided to the corpora23 tion— 

24 ‘‘(I) the ratio of the number of 

25 retirees, beneficiaries of deceased parVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00014 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
15 

•S 3157 IS

1 ticipants, and terminated vested par2 ticipants in the plan to the number of 

3 the active participants in the plan for 

4 each such year was not less than 10 

5 to 1, and 

6 ‘‘(II) the ratio of benefit pay7 ments made by the plan for each such 

8 year to contributions required to be 

9 made to the plan under section 304 

10 for each such year was not less than 

11 2 to 1, and 

12 ‘‘(iii) the plan suffered a substantial 

13 reduction in the amount of contribution 

14 base units under the plan as a result of de15 clining employment within the industry of 

16 employers covered by the plan. 

17 ‘‘(3) ELIGIBLE PARTITION EMPLOYER.—For 

18 purposes of this subsection, the term ‘eligible parti19 tion employer’ means an employer which, before the 

20 date the notice described in paragraph (1) is pro21 vided to the corporation with respect to an eligible 

22 multiemployer plan in which the employer partici23 pates— 

24 ‘‘(A) ceased contributions to such eligible 

25 multiemployer plan as a result of a case or proVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
16 

•S 3157 IS

1 ceeding under title 11, United States Code, 

2 with respect to such employer, or 

3 ‘‘(B) withdrew completely from such plan 

4 without paying the full amount of the employ5 er’s allocable amount of unfunded vested bene6 fits determined under section 4211. 

7 ‘‘(4) TRANSFERS UNDER PARTITION ORDER.— 

8 ‘‘(A) SCOPE OF PARTITION ORDER.—The 

9 corporation’s partition order issued under para10 graph (1) shall provide for— 

11 ‘‘(i) a transfer, as of the date of the 

12 partition, of the nonforfeitable benefits di13 rectly attributable to service with eligible 

14 partition employers, and 

15 ‘‘(ii) a transfer of assets in an amount 

16 equal to the greater of— 

17 ‘‘(I) the amount of assets attrib18 utable to any withdrawal liability pay19 ments by such employers, as adjusted 

20 by any gains or losses thereon and re21 duced by any benefit payments made 

22 with regard to service with such em23 ployers, or 

24 ‘‘(II) the present value, as deter25 mined by the plan actuary of the eligiVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
17 

•S 3157 IS

1 ble multiemployer plan, of all non2 forfeitable benefits directly attrib3 utable to service with eligible partition 

4 employers which are expected to be 

5 paid within 60 months of the effective 

6 date of the partition order. 

7 For purposes of clause (ii)(II), the cor8 poration shall reduce the 60 month period 

9 described therein as necessary in order to 

10 allow an eligible multiemployer plan to sat11 isfy the requirements of paragraph 

12 (2)(A)(v) (including the requirements of 

13 such subparagraph as applied to such plan 

14 by paragraph (2)(B)(i)). 

15 ‘‘(B) ACTUARIAL ASSUMPTIONS.—The 

16 present value of the nonforfeitable benefits de17 scribed in subparagraph (A) shall be deter18 mined by the plan actuary on the basis of the 

19 assumptions prescribed by the corporation for 

20 purposes of section 4044. In determining the 

21 benefits attributable to employment with eligible 

22 partition employers, a plan may elect to at23 tribute all employment of a participant to the 

24 participant’s most recent employer under the 

25 plan, prorate a participant’s benefit among each 


dcolon on DSK2BSOYB1PROD with BILLS
18 

•S 3157 IS

1 of the participant’s employers under the plan 

2 based on the participant’s length of covered em3 ployment with each employer, or use any other 

4 reasonable method approved by the corporation. 

5 ‘‘(C) FORM OF ASSET TRANSFER.—Not6 withstanding any other provision of this Act or 

7 the Internal Revenue Code of 1986— 

8 ‘‘(i) the transfer of assets required 

9 under subparagraph (A)(ii) may, at the 

10 discretion of the plan sponsor of the plan 

11 created by the partition, be accomplished 

12 by means of the transfer of an undivided 

13 interest in assets of the remaining eligible 

14 multiemployer plan equal in value, on the 

15 day before the transfer, to the amount re16 quired to be transferred, and 

17 ‘‘(ii) the combined assets of the re18 maining eligible multiemployer plan and of 

19 the plan created by the partition may, at 

20 the discretion of the plan sponsor of the 

21 plan created by the partition, continue to 

22 be managed and invested as a pooled fund 

23 under the eligible multiemployer plan’s in24 vestment policies without taking the parti25 tion into account, provided that each plan’s 


dcolon on DSK2BSOYB1PROD with BILLS
19 

•S 3157 IS

1 respective interest in the pooled investment 

2 fund is adjusted to reflect investment gains 

3 and losses of the fund as a whole and to 

4 reflect each plan’s actual benefit payments 

5 and expenses of administration. 

6 ‘‘(D) TRANSFER IN CASE OF DECLINE IN

7 CONTRIBUTIONS.—As of the last day of each of 

8 the 3 plan years following the plan year of the 

9 effective date of the corporation’s partition 

10 order under paragraph (1), the plan sponsor of 

11 the remaining eligible multiemployer plan shall 

12 determine whether, during such plan year, the 

13 total contributions under the plan declined by 

14 10 percent or more after the date of such parti15 tion order as a result of events described in 

16 paragraph (2)(A)(i). If such decline has oc17 curred during any such plan year, a transfer (in 

18 addition to the transfers required under sub19 paragraph (A)) shall be made as of the last day 

20 of such plan year of— 

21 ‘‘(i) the nonforfeitable benefits di22 rectly attributable to service with employ23 ers that become eligible partition employ24 ers (as determined as of the last day of 


dcolon on DSK2BSOYB1PROD with BILLS
20 

•S 3157 IS

1 such plan year) after the date of such par2 tition order, and 

3 ‘‘(ii) an amount equal to the greater 

4 of— 

5 ‘‘(I) the amount of assets attrib6 utable to any withdrawal liability pay7 ments by such employers, as adjusted 

8 by any gains or losses thereon and re9 duced by any benefit payments made 

10 with regard to service with such em11 ployers, or 

12 ‘‘(II) the present value, as deter13 mined by the plan actuary of the eligi14 ble multiemployer plan, of all non15 forfeitable benefits directly attrib16 utable to service with eligible partition 

17 employers which are expected to be 

18 paid within 60 months of the last day 

19 of such plan year. 

20 ‘‘(E) COORDINATED ADMINISTRATION

21 AGREEMENT.—The plan created by the parti22 tion and the remaining eligible multiemployer 

23 plan may enter into a coordinated administra24 tion agreement for the efficient processing of 

25 benefit payments and may remit benefit payVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00020 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
21 

•S 3157 IS

1 ments to participants and beneficiaries with a 

2 single, combined check or other combined 

3 means of transfer. 

4 ‘‘(5) PLAN CREATED BY PARTITION.—The plan 

5 created by the partition shall be— 

6 ‘‘(A) a successor plan to which section 

7 4022A applies, and 

8 ‘‘(B) a terminated multiemployer plan to 

9 which section 4041A(d) applies, with respect to 

10 which no employer has withdrawal liability ex11 cept as provided in paragraph (7). 

12 ‘‘(6) ADMINISTRATION AND SPONSORSHIP OF

13 PLAN CREATED BY PARTITION.—The plan adminis14 trator and the plan sponsor of an eligible multiem15 ployer plan before a partition under paragraph (1) 

16 shall be the plan administrator and the plan sponsor 

17 of the plan created by such partition, unless the cor18 poration orders otherwise. 

19 ‘‘(7) EMPLOYER WITHDRAWAL.— 

20 ‘‘(A) IN GENERAL.—If an employer com21 pletely withdraws (within the meaning of sec22 tion 4203) from the plan within 60 months of 

23 the corporation’s partition order under para24 graph (1), the employer’s withdrawal liability to 


dcolon on DSK2BSOYB1PROD with BILLS
22 

•S 3157 IS

1 the plan shall be determined as if the partition 

2 had not occurred. 

3 ‘‘(B) PAYMENT OF WITHDRAWAL LIABIL4 ITY.—In the case of an employer that com5 pletely withdraws or partially withdraws (within 

6 the meaning of section 4205) from the plan 

7 after the effective date of the corporation’s par8 tition order under paragraph (1), and an em9 ployer that completely or partially withdraws 

10 before such date whose withdrawal liability to 

11 the plan remains outstanding as of such effec12 tive date, the withdrawal liability of such em13 ployer shall be payable to, and shall be collected 

14 by the plan sponsor of, the remaining eligible 

15 multiemployer plan. 

16 ‘‘(8) LIMITATION ON BENEFIT INCREASES.—In 

17 the case of a plan that elects a partition under this 

18 subsection, in addition to any other applicable re19 strictions on benefit increases, such plan may not 

20 adopt— 

21 ‘‘(A) an amendment which increases the li22 abilities of the plan by reason of any increase 

23 in benefits, 

24 ‘‘(B) any change which has the effect of 

25 increasing the accrual of benefits, or 


dcolon on DSK2BSOYB1PROD with BILLS
23 

•S 3157 IS

1 ‘‘(C) any change in the rate at which bene2 fits become nonforfeitable under the plan, 

3 for a period of 5 plan years immediately following 

4 the plan year of the corporation’s partition order 

5 under paragraph (1), unless such amendment or 

6 change is required as a condition of qualification 

7 under part I of subchapter D of chapter 1 of the In8 ternal Revenue Code of 1986 or to comply with 

9 other applicable law.’’. 

10 (2) LIMITATION ON BENEFIT INCREASES FOL11 LOWING A PARTITION.— 

12 (A) AMENDMENT TO ERISA.—Section 305 

13 of the Employee Retirement Income Security 

14 Act of 1974 is amended by adding at the end 

15 the following new subsection: 

16 ‘‘(j) LIMITATION ON BENEFIT INCREASES FOL17 LOWING CERTAIN PARTITIONS.—For limitations in the 

18 case of a plan that elects a partition under section 

19 4233(g), see paragraph (8) thereof.’’. 

20 (B) AMENDMENT TO INTERNAL REVENUE

21 CODE OF 1986.—Section 432 of the Internal 

22 Revenue Code of 1986 is amended by adding at 

23 the end the following new subsection: 

24 ‘‘(j) LIMITATION ON BENEFIT INCREASES FOL25 LOWING CERTAIN PARTITIONS.—In the case of a plan 


dcolon on DSK2BSOYB1PROD with BILLS
24 

•S 3157 IS

1 that elects a partition under section 4233(g) of the Em2 ployee Retirement Income Security Act of 1974, in addi3 tion to any other applicable restrictions on benefit in4 creases, such plan may not adopt— 

5 ‘‘(1) an amendment which increases the liabil6 ities of the plan by reason of any increase in bene7 fits, 

8 ‘‘(2) any change which has the effect of increas9 ing the accrual of benefits, or 

10 ‘‘(3) any change in the rate at which benefits 

11 become nonforfeitable under the plan, 

12 for a period of 5 plan years immediately following the plan 

13 year of the partition order issued by the Pension Benefit 

14 Guarantee Corporation under paragraph (1) of such sec15 tion, unless such amendment or change is required as a 

16 condition of qualification under part I of subchapter D 

17 of chapter 1 or to comply with other applicable law.’’. 

18 (3) EFFECT OF PARTITION ON PREMIUMS.— 

19 (A) Clause (i) of section 4006(a)(3)(C) of 

20 the Employee Retirement Income Security Act 

21 of 1974 is amended by adding at the end the 

22 following: ‘‘For purposes of this subparagraph, 

23 the value of assets held by the corporation and 

24 the basic benefits guaranteed for multiemployer 

25 plans shall not include assets and liabilities 


dcolon on DSK2BSOYB1PROD with BILLS
25 

•S 3157 IS

1 transferred pursuant to a partition order under 

2 section 4233(g)(1).’’ 

3 (B) Section 4022A(f) of such Act is 

4 amended by adding at the end the following 

5 new paragraph: 

6 ‘‘(5) Basic benefits guaranteed in connection with as7 sets and liabilities transferred to the corporation pursuant 

8 to a partition order under section 4233(g)(1) shall be dis9 regarded under paragraphs (1), (2), and (3).’’. 

10 (4) PBGC GUARANTEE OF PARTITIONED BENE11 FITS.— 

12 (A) Section 4022A of the Employee Retire13 ment Income Security Act of 1974 is amended 

14 by adding at the end the following new sub15 section: 

16 ‘‘(i) The monthly benefit of a participant or a bene17 ficiary whose benefit was transferred pursuant to a parti18 tion under section 4233(g) which is guaranteed under this 

19 section by the corporation with respect to a plan is equal 

20 to the nonforfeitable benefits of such participant or bene21 ficiary transferred pursuant to the partition.’’. 

22 (B) Section 4022A(c)(1) of such Act is 

23 amended by striking ‘‘subsection (g)’’ and in24 serting ‘‘subsections (g) and (i)’’. 


dcolon on DSK2BSOYB1PROD with BILLS
26 

•S 3157 IS

1 (5) REPORT TO CONGRESS.—Not later than De2 cember 31, 2011, the Secretary of the Treasury and 

3 the Secretary of Labor shall submit a joint report to 

4 the Committee on Finance and the Committee on 

5 Health, Education, Labor, and Pensions of the Sen6 ate and the Committee on Ways and Means and the 

7 Committee on Education and Labor of the House of 

8 Representatives regarding the funding status of 

9 those plans that have received a partition order 

10 under section 4233(g)(1) of the Employee Retire11 ment Income Security Act of 1974, the amount of 

12 assets utilized in connection with any such parti13 tions, and any recommendations to extend such par14 titions or to further improve current law with re15 spect to such partitions. 

16 (6) REHABILITATION PLAN REQUIREMENTS.— 

17 (A) AMENDMENTS TO ERISA.— 

18 (i) Section 305(e)(3) of the Employee 

19 Retirement Income Security Act of 1974 is 

20 amended by adding at the end the fol21 lowing new subparagraph: 

22 ‘‘(D) CERTAIN PARTITIONS.—Notwith23 standing any other provision of this section, in 

24 the case of an eligible multiemployer plan whose 

25 plan sponsor elects a partition under section 


dcolon on DSK2BSOYB1PROD with BILLS
27 

•S 3157 IS

1 4233(g), the requirements of subparagraph (A) 

2 shall not be applied to require any action, op3 tion, or measure to be included in the plan’s re4 habilitation plan to the extent such action, op5 tion, or measure would, in the reasonable deter6 mination of the plan sponsor, adversely affect 

7 the future level of covered employment under 

8 the plan.’’. 

9 (ii) Section 305(e)(4) of such Act is 

10 amended by adding at the end the fol11 lowing new subparagraph: 

12 ‘‘(C) COORDINATION WITH SECTION

13 4233(G).—The modification of a rehabilitation 

14 plan by the plan sponsor of a plan that elects 

15 a partition under section 4233(g) shall not af16 fect the rehabilitation period of such plan, and 

17 any change to the rehabilitation plan to reflect 

18 the effect of such partition shall constitute an 

19 update of the rehabilitation plan as in effect on 

20 the day before such partition.’’. 

21 (B) AMENDMENTS TO THE INTERNAL REV22 ENUE CODE OF 1986.— 

23 (i) Section 432(e)(3) of the Internal 

24 Revenue Code of 1986 is amended by addVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
28 

•S 3157 IS

1 ing at the end the following new subpara2 graph: 

3 ‘‘(D) CERTAIN PARTITIONS.—Notwith4 standing any other provision of this section, in 

5 the case of an eligible multiemployer plan whose 

6 plan sponsor elects a partition under section 

7 4233(g) of the Employee Retirement Income 

8 Security Act of 1974, the requirements of sub9 paragraph (A) shall not be applied to require 

10 any action, option, or measure to be included in 

11 the plan’s rehabilitation plan to the extent such 

12 action, option, or measure would, in the reason13 able determination of the plan sponsor, ad14 versely affect the future level of covered employ15 ment under the plan.’’. 

16 (ii) Section 432(e)(4) of such Code is 

17 amended by adding at the end the fol18 lowing new subparagraph: 

19 ‘‘(C) COORDINATION WITH SECTION

20 4233(G) OF ERISA.—The modification of a reha21 bilitation plan by the plan sponsor of a plan 

22 that elects a partition under section 4233(g) of 

23 the Employee Retirement Income Security Act 

24 of 1974 shall not affect the rehabilitation period 

25 of such plan, and any change to the rehabilitaVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00028 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
29 

•S 3157 IS

1 tion plan to reflect the effect of such partition 

2 shall constitute an update of the rehabilitation 

3 plan as in effect on the day before such parti4 tion.’’. 

5 (7) ENFORCEMENT.—Section 4003(f)(1) of the 

6 Employee Retirement Income Security Act of 1974 

7 is amended— 

8 (A) by inserting ‘‘(A)’’ after ‘‘(f)(1)’’, and 

9 (B) by adding at the end the following: 

10 ‘‘(B) The plan sponsor of an eligible multiemployer 

11 plan that is adversely affected by the corporation’s failure 

12 to issue a partition order as required under section 

13 4233(g)(1) may bring an action against the corporation 

14 for appropriate equitable relief in the appropriate court. 

15 In any such action, the court may order the partition upon 

16 finding that the requirements of section 4233(g)(1) have 

17 been satisfied.’’. 

18 (d) FINANCING FOR PARTITIONS AND OTHER SPE19 CIAL MATTERS.— 

20 (1) OBLIGATIONS OF THE CORPORATION.—The 

21 second sentence of section 4002(g)(2) of the Em22 ployee Retirement Income Security Act of 1974 is 

23 amended to read as follows: ‘‘The United States 

24 Government is not liable for any obligation or liabil25 ity incurred by the corporation, except with respect 


dcolon on DSK2BSOYB1PROD with BILLS
30 

•S 3157 IS

1 to liabilities transferred pursuant to a partition of a 

2 multiemployer plan under section 4233(g).’’ 

3 (2) PBGC FUND ESTABLISHED.—Section 4005 

4 of such Act is amended by striking subsections (d) 

5 and (e), by redesignating subsections (f) through (h) 

6 as subsections (e) through (g), respectively, and by 

7 inserting after subsection (c) the following new sub8 section: 

9 ‘‘(d) ESTABLISHMENT OF FIFTH FUND; PURPOSE; 

10 AVAILABILITY, ETC.— 

11 ‘‘(1) IN GENERAL.—A fifth fund shall be estab12 lished for the purposes described in paragraph (2). 

13 ‘‘(2) USE OF FUND.—The fund established by 

14 this subsection shall be used to finance obligations 

15 undertaken by the corporation under section 4233. 

16 ‘‘(3) CREDITS TO FUND.—The fund established 

17 under this subsection shall be credited with funds 

18 made available to the corporation that are des19 ignated for special matters and the earnings thereon, 

20 including any amounts received in connection with a 

21 partition under section 4233(g), and shall not in22 clude premiums paid under section 4007, employer 

23 liability or withdrawal liability payments, the assets 

24 of terminated plans or repayments of financial as25 sistance under section 4261, or other amounts reVerDate Nov 24 2008 02:42 Mar 24, 2010 Jkt 089200 PO 00000 Frm 00030 Fmt 6652 Sfmt 6201 E:\BILLS\S3157.IS S3157

dcolon on DSK2BSOYB1PROD with BILLS
31 

•S 3157 IS

1 ceived in connection with terminated or insolvent 

2 plans. 

3 ‘‘(4) TRANSACTIONS WITH OTHER FUNDS.— 

4 Notwithstanding paragraph (3), this fund may en5 gage in transactions with the other funds established 

6 under this section to the extent reasonable and nec7 essary to meet liquidity demands and to maximize 

8 the ability of the corporation to accomplish its mis9 sion under section 4002(a) without increasing the 

10 premiums payable under section 4006. 

11 ‘‘(5) INVESTMENTS.—The corporation may in12 vest amounts of the fund in such obligations as the 

13 corporation considers appropriate. 

14 ‘‘(6) OBLIGATIONS OF UNITED STATES.—Not15 withstanding any other provision of this title, obliga16 tions of the corporation which are financed by the 

17 fund created by this subsection shall be obligations 

18 of the United States.’’. 

19 (3) CONFORMING AMENDMENTS.— 

20 (A) Section 4022A(g) of such Act is 

21 amended by striking paragraph (2). 

22 (B) Part 1 of subtitle E of title IV of such 

23 Act is amended by striking section 4222, and 

24 the table of contents for such Act is amended 

25 by striking the item relating to section 4222. 


dcolon on DSK2BSOYB1PROD with BILLS
32 

•S 3157 IS

1 (e) EFFECTIVE DATES.— 

2 (1) The amendments made by subsection (a) 

3 shall apply with respect to plans that first apply for 

4 financial assistance from the Pension Benefit Guar5 antee Corporation after the date of the enactment of 

6 this Act. 

7 (2) The amendments made by subsection (b) 

8 shall apply to plan years beginning after December 

9 31, 2010. 

10 (3) The amendments made by subsections (c) 

11 and (d) shall take effect on the date of the enact12 ment of this Act. 

Æ 


dcolon on DSK2BSOYB1PROD with BILLS