II 

111TH CONGRESS 

2D SESSION S. 3319 

To amend the Internal Revenue Code of 1986 to provide recruitment and 

retention incentives for volunteer emergency service workers. 

IN THE SENATE OF THE UNITED STATES 

MAY 5, 2010 

Ms. COLLINS (for herself and Mr. DODD) 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 provide 

recruitment and retention incentives for volunteer emergency service workers. 

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 ‘‘Volunteer Emergency 

5 Services Recruitment and Retention Act of 2010’’. 

6 SEC. 2. ELECTIVE TREATMENT OF LENGTH OF SERVICE 

7 AWARD PROGRAMS AS ELIGIBLE DEFERRED 

8 COMPENSATION PLANS. 

9 (a) IN GENERAL.—Section 457(e) of the Internal 

10 Revenue Code of 1986 (relating to other definitions and 


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1 special rules) is amended by adding at the end the fol2 lowing new paragraph: 

3 ‘‘(19) SPECIAL RULES APPLICABLE TO LENGTH

4 OF SERVICE AWARD PLANS.— 

5 ‘‘(A) IN GENERAL.—The term ‘eligible de6 ferred compensation plan’ shall include, at the 

7 election of its sponsor, any length of service 

8 award plan. Any such election shall be irrev9 ocable. In the case of a length of service award 

10 plan whose sponsor has elected to have such 

11 plan treated as an eligible deferred compensa12 tion plan, such plan shall be administered in a 

13 manner consistent with the requirements of this 

14 section and such sponsor shall be treated as an 

15 eligible employer described in paragraph (1)(A). 

16 ‘‘(B) LENGTH OF SERVICE AWARD

17 PLAN.—For purposes of this paragraph— 

18 ‘‘(i) IN GENERAL.—The term ‘length 

19 of service award plan’ means any plan pay20 ing solely length of service awards to bona 

21 fide volunteers (or their beneficiaries) on 

22 account of qualified services performed by 

23 such volunteers. 

24 ‘‘(ii) BONA FIDE VOLUNTEER.—An in25 dividual shall be treated as a bona fide volVerDate Mar 15 2010 03:46 May 06, 2010 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3319.IS S3319

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1 unteer if the only compensation received by 

2 such individual for performing qualified 

3 services is in the form of— 

4 ‘‘(I) reimbursement for (or a rea5 sonable allowance for) reasonable ex6 penses incurred in the performance of 

7 such services, or 

8 ‘‘(II) reasonable benefits (includ9 ing length of service awards), and fees 

10 for such services, customarily paid by 

11 eligible employers in connection with 

12 the performance of such services by 

13 volunteers. 

14 ‘‘(iii) QUALIFIED SERVICES.—The 

15 term ‘qualified services’ means firefighting 

16 and prevention services, emergency medical 

17 services, ambulance services, and emer18 gency rescue services. 

19 ‘‘(C) MAXIMUM DEFERRAL AMOUNT.—In 

20 the case of a length of service award plan whose 

21 sponsor has elected to have such plan treated as 

22 an eligible deferred compensation plan, sub23 section (b)(2) shall be applied by striking ‘the 

24 lesser of—’ and all that follows and inserting 

25 ‘the applicable dollar amount,’. 


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1 ‘‘(D) DISTRIBUTION REQUIREMENTS.—In 

2 the case of a length of service award plan whose 

3 sponsor has elected to have such plan treated as 

4 an eligible deferred compensation plan, sub5 section (d)(1)(A)(ii) shall be applied by deeming 

6 a severance from employment to have occurred 

7 at the later of— 

8 ‘‘(i) the payment date under the terms 

9 of the plan, or 

10 ‘‘(ii) the date on which the plan par11 ticipant ceases to perform qualified serv12 ices. 

13 ‘‘(E) LIMITATION ON ACCRUALS.— 

14 ‘‘(i) IN GENERAL.—In the case of a 

15 length of service award plan that is a de16 fined benefit plan (as defined in section 

17 414(j)) whose sponsor has not elected to 

18 have such plan treated as an eligible de19 ferred compensation plan, such plan shall 

20 be treated as not providing for the deferral 

21 of compensation if the aggregate amount 

22 of length of service awards accruing with 

23 respect to any year of service for any bona 

24 fide volunteer does not exceed $5,500. In 

25 the case of a length of service award plan 


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1 described in the preceding sentence that is 

2 a defined benefit plan (as defined in sec3 tion 414(j)), the limitation on the annual 

4 deferral shall apply to the actuarial present 

5 value of the aggregate amount of length of 

6 service awards accruing with respect to 

7 any year of service. Such actuarial present 

8 value shall be calculated using reasonable 

9 actuarial assumptions and methods assum10 ing payment shall be made under the most 

11 valuable form of payment of the length of 

12 service award under the program with pay13 ment commencing at the later of the ear14 liest age at which unreduced benefits are 

15 payable under the program or the partici16 pant’s current age. 

17 ‘‘(ii) COST-OF-LIVING ADJUSTMENT.— 

18 In the case of taxable years beginning 

19 after December 31, 2010, the Secretary 

20 shall adjust the $5,500 amount under 

21 clause (i) at the same time and in the 

22 same manner as under section 415(d), ex23 cept that the base period shall be the cal24 endar quarter beginning July 1, 2009, and 

25 any increase under this paragraph that is 


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1 not a multiple of $500 shall be rounded to 

2 the next lowest multiple of $500.’’. 

3 (b) CONFORMING AMENDMENTS.— 

4 (1) Section 457(e)(11) of the Internal Revenue 

5 Code of 1986 is amended to read as follows: 

6 ‘‘(11) CERTAIN PLANS EXCLUDED.—Any bona 

7 fide vacation leave, sick leave, compensatory time, 

8 severance pay, disability pay, or death benefit plan 

9 shall be treated as not providing for the deferral of 

10 compensation.’’. 

11 (2) Section 3121(a)(5)(I) of such Code is 

12 amended by striking ‘‘section 457(e)(11)(A)(ii)’’ and 

13 inserting ‘‘section 457(e)(19)’’. 

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

15 this section shall apply to taxable years beginning after 

16 December 31, 2009. 

17 SEC. 3. EXEMPTION OF LENGTH OF SERVICE AWARD PRO18 GRAMS FROM THE EMPLOYEE RETIREMENT 

19 INCOME SECURITY ACT OF 1974. 

20 The Secretary of Labor shall issue guidance clari21 fying that a length of service award program described 

22 in section 457(e)(19) of the Internal Revenue Code of 

23 1986 is not an employee pension benefit plan under secVerDate Mar 15 2010 03:46 May 06, 2010 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S3319.IS S3319

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1 tion 3(2) of the Employee Retirement Income Security Act 

2 of 1974 (29 U.S.C. 1002(2)). 

Æ 


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