118 
† HR 4213 EAS 
purposes of clause (i), there shall only be 
taken into account dividends declared, and 
redemptions occurring, after February 28, 
2010. 
‘‘(iii) EXCEPTION
FOR
INTRA-GROUP 
DIVIDENDS.—Dividends paid by one mem-
ber of a controlled group (as defined in sec-
tion 412(d)(3)) to another member of such 
group shall not be taken into account under 
clause (i). 
‘‘(iv) EXCEPTION
FOR
CERTAIN
RE-
DEMPTIONS.—Redemptions that are made 
pursuant to a plan maintained with respect 
to employees, or that are made on account 
of the death, disability, or termination of 
employment of an employee or shareholder, 
shall not be taken into account under clause 
(i). 
‘‘(v) EXCEPTION
FOR
CERTAIN
PRE-
FERRED STOCK.— 
‘‘(I) 
IN
GENERAL.—Dividends 
and redemptions with respect to appli-
cable preferred stock shall not be taken 
into account under clause (i) to the ex-
tent that dividends accrue with respect
119 
† HR 4213 EAS 
to such stock at a specified rate in all 
events and without regard to the plan 
sponsor’s income, and interest accrues 
on any unpaid dividends with respect 
to such stock. 
‘‘(II) 
APPLICABLE
PREFERRED 
STOCK.—For purposes of subclause (I), 
the term ‘applicable preferred stock’ 
means preferred stock which was issued 
before March 1, 2010 (or which was 
issued after such date and is held by 
an employee benefit plan subject to the 
provisions of title I of Employee Re-
tirement Income Security Act of 1974). 
‘‘(F) OTHER
DEFINITIONS
AND
RULES.— 
For purposes of this paragraph— 
‘‘(i) PLAN SPONSOR.—The term ‘ plan 
sponsor’ includes any member of the plan 
sponsor’s controlled group (as defined in 
section 412(d)(3)). 
‘‘(ii) RESTRICTION PERIOD.—The term 
‘restriction period’ means, with respect to 
any election year— 
‘‘(I) except as provided in sub-
clause (II), the 3-year period beginning
120 
† HR 4213 EAS 
with the election year (or, if later, the 
first plan year beginning after Decem-
ber 31, 2009), and 
‘‘(II) if the plan sponsor elects 15- 
year amortization for the shortfall am-
ortization base for the election year, the 
5-year period beginning with the elec-
tion year (or, if later, the first plan 
year beginning after December 31, 
2009). 
‘‘(iii) 
ELECTIONS
FOR
MULTIPLE 
PLANS.—If a plan sponsor makes elections 
under paragraph (2)(D) with respect to 2 
or more plans, the Secretary shall provide 
rules for the application of this paragraph 
to such plans, including rules for the ratable 
allocation of any installment acceleration 
amount among such plans on the basis of 
each plan’s relative reduction in the plan’s 
shortfall amortization installment for the 
first plan year in the amortization period 
described in subparagraph (A) (determined 
without regard to this paragraph). 
‘‘(iv) MERGERS AND ACQUISITIONS.— 
The Secretary shall prescribe rules for the
121 
† HR 4213 EAS 
application of paragraph (2)(D) and this 
paragraph in any case where there is a 
merger or acquisition involving a plan 
sponsor making the election under para-
graph (2)(D).’’. 
(3) CONFORMING AMENDMENTS.—Section 430 is 
amended— 
(A) in subsection (c)(1), by striking ‘‘the 
shortfall amortization bases for such plan year 
and each of the 6 preceding plan years’’ and in-
serting ‘‘any shortfall amortization base which 
has not been fully amortized under this sub-
section’’, and 
(B) in subsection (j)(3), by adding at the 
end the following: 
‘‘(F) QUARTERLY CONTRIBUTIONS NOT TO 
INCLUDE
CERTAIN
INCREASED
CONTRIBU-
TIONS.—Subparagraph (D) shall be applied 
without regard to any increase under subsection 
(c)(7).’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to plan years beginning after December 
31, 2007.
122 
† HR 4213 EAS 
SEC. 302. APPLICATION OF EXTENDED AMORTIZATION PE-
RIOD TO PLANS SUBJECT TO PRIOR LAW 
FUNDING RULES. 
(a) IN GENERAL.—Title I of the Pension Protection 
Act of 2006 is amended by redesignating section 107 as sec-
tion 108 and by inserting the following after section 106: 
‘‘SEC. 107. APPLICATION OF EXTENDED AMORTIZATION PE-
RIODS TO PLANS WITH DELAYED EFFECTIVE 
DATE. 
‘‘(a) IN GENERAL.—If the plan sponsor of a plan to 
which section 104, 105, or 106 of this Act applies elects 
to have this section apply for any eligible plan year (in 
this section referred to as an ‘election year’), section 302 
of the Employee Retirement Income Security Act of 1974 
and section 412 of the Internal Revenue Code of 1986 (as 
in effect before the amendments made by this subtitle and 
subtitle B) shall apply to such year in the manner described 
in subsection (b) or (c), whichever is specified in the elec-
tion. All references in this section to ‘such Act’ or ‘such 
Code’ shall be to such Act or such Code as in effect before 
the amendments made by this subtitle and subtitle B. 
‘‘(b) APPLICATION OF 2 AND 7 RULE.—In the case of 
an election year to which this subsection applies— 
‘‘(1) 2-YEAR LOOKBACK FOR DETERMINING DEF-
ICIT
REDUCTION
CONTRIBUTIONS
FOR
CERTAIN 
PLANS.—For purposes of applying section 302(d)(9)
123 
† HR 4213 EAS 
of such Act and section 412(l)(9) of such Code, the 
funded current liability percentage (as defined in sub-
paragraph (C) thereof) for such plan for such plan 
year shall be such funded current liability percentage 
of such plan for the second plan year preceding the 
first election year of such plan. 
‘‘(2) CALCULATION OF DEFICIT REDUCTION CON-
TRIBUTION.—For purposes of applying section 302(d) 
of such Act and section 412(l) of such Code to a plan 
to which such sections apply (after taking into ac-
count paragraph (1))— 
‘‘(A) in the case of the increased unfunded 
new liability of the plan, the applicable percent-
age described in section 302(d)(4)(C) of such Act 
and section 412(l)(4)(C) of such Code shall be the 
third segment rate described in sections 104(b), 
105(b), and 106(b) of this Act, and 
‘‘(B) in the case of the excess of the un-
funded new liability over the increased unfunded 
new liability, such applicable percentage shall be 
determined without regard to this section. 
‘‘(c) APPLICATION
OF 15-YEAR AMORTIZATION.—In 
the case of an election year to which this subsection applies, 
for purposes of applying section 302(d) of such Act and sec-
tion 412(l) of such Code—
126 
† HR 4213 EAS 
‘‘(3) INCREASED UNFUNDED NEW LIABILITY.— 
The term ‘increased unfunded new liability’ means, 
with respect to a year, the excess (if any) of the un-
funded new liability over the amount of unfunded 
new liability determined as if the value of the plan’s 
assets determined under subsection 302(c)(2) of such 
Act and section 412(c)(2) of such Code equaled the 
product of the current liability of the plan for the 
year multiplied by the funded current liability per-
centage (as defined in section 302(d)(8)(B) of such 
Act and 412(l)(8)(B) of such Code) of the plan for the 
second plan year preceding the first election year of 
such plan. 
‘‘(4) OTHER DEFINITIONS.—The terms ‘unfunded 
new liability’ and ‘current liability’ shall have the 
meanings set forth in section 302(d) of such Act and 
section 412(l) of such Code.’’. 
(b) ELIGIBLE CHARITY PLANS.—Section 104 of the 
Pension Protection Act of 2006 is amended— 
(1) by striking ‘‘eligible cooperative plan’’ wher-
ever it appears in subsections (a) and (b) and insert-
ing ‘‘eligible cooperative plan or an eligible charity 
plan’’, and 
(2) by adding at the end the following new sub-
section:
127 
† HR 4213 EAS 
‘‘(d) ELIGIBLE CHARITY PLAN DEFINED.—For pur-
poses of this section, a plan shall be treated as an eligible 
charity plan for a plan year if the plan is maintained by 
more than one employer (determined without regard to sec-
tion 414(c) of the Internal Revenue Code) and 100 percent 
of the employers are described in section 501(c)(3) of such 
Code.’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendment made by sub-
section (a) shall take effect as if included in the Pen-
sion Protection Act of 2006. 
(2) ELIGIBLE CHARITY PLAN.—The amendments 
made by subsection (b) shall apply to plan years be-
ginning after December 31, 2007, except that a plan 
sponsor may elect to apply such amendments to plan 
years beginning after December 31, 2008. Any such 
election shall be made at such time, and in such form 
and manner, as shall be prescribed by the Secretary 
of the Treasury, and may be revoked only with the 
consent of the Secretary of the Treasury. 
SEC. 303. LOOKBACK FOR CERTAIN BENEFIT RESTRIC-
TIONS. 
(a) IN GENERAL.—
128 
† HR 4213 EAS 
(1) AMENDMENT TO ERISA.—Section 206(g)(9) of 
the Employee Retirement Income Security Act of 
1974 is amended by adding at the end the following: 
‘‘(D) SPECIAL RULE FOR CERTAIN YEARS.— 
Solely for purposes of any applicable provi-
sion— 
‘‘(i) IN GENERAL.—For plan years be-
ginning on or after October 1, 2008, and be-
fore October 1, 2010, the adjusted funding 
target attainment percentage of a plan shall 
be the greater of— 
‘‘(I) such percentage, as deter-
mined without regard to this subpara-
graph, or 
‘‘(II) the adjusted funding target 
attainment percentage for such plan 
for the plan year beginning after Octo-
ber 1, 2007, and before October 1, 
2008, as determined under rules pre-
scribed by the Secretary of the Treas-
ury. 
‘‘(ii) SPECIAL RULE.—In the case of a 
plan for which the valuation date is not the 
first day of the plan year—
129 
† HR 4213 EAS 
‘‘(I) clause (i) shall apply to plan 
years beginning after December 31, 
2007, and before January 1, 2010, and 
‘‘(II) clause (i)(II) shall apply 
based on the last plan year beginning 
before November 1, 2007, as determined 
under rules prescribed by the Secretary 
of the Treasury. 
‘‘(iii) APPLICABLE
PROVISION.—For 
purposes of this subparagraph, the term 
‘applicable provision’ means— 
‘‘(I) paragraph (3), but only for 
purposes of applying such paragraph 
to a payment which, as determined 
under rules prescribed by the Secretary 
of the Treasury, is a payment under a 
social security leveling option which 
accelerates payments under the plan 
before, and reduces payments after, a 
participant starts receiving social secu-
rity benefits in order to provide sub-
stantially similar aggregate payments 
both before and after such benefits are 
received, and 
‘‘(II) paragraph (4).’’.
130 
† HR 4213 EAS 
(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Section 436(j) of the Internal Revenue Code 
of 1986 is amended by adding at the end the fol-
lowing: 
‘‘(3) SPECIAL RULE FOR CERTAIN YEARS.—Sole-
ly for purposes of any applicable provision— 
‘‘(A) IN GENERAL.—For plan years begin-
ning on or after October 1, 2008, and before Oc-
tober 1, 2010, the adjusted funding target attain-
ment percentage of a plan shall be the greater 
of— 
‘‘(i) such percentage, as determined 
without regard to this paragraph, or 
‘‘(ii) the adjusted funding target at-
tainment percentage for such plan for the 
plan year beginning after October 1, 2007, 
and before October 1, 2008, as determined 
under rules prescribed by the Secretary. 
‘‘(B) SPECIAL RULE.—In the case of a plan 
for which the valuation date is not the first day 
of the plan year— 
‘‘(i) subparagraph (A) shall apply to 
plan years beginning after December 31, 
2007, and before January 1, 2010, and
131 
† HR 4213 EAS 
‘‘(ii) subparagraph (A)(ii) shall apply 
based on the last plan year beginning before 
November 1, 2007, as determined under 
rules prescribed by the Secretary. 
‘‘(C) APPLICABLE
PROVISION.—For pur-
poses of this paragraph, the term ‘applicable 
provision’ means— 
‘‘(i) subsection (d), but only for pur-
poses of applying such paragraph to a pay-
ment which, as determined under rules pre-
scribed by the Secretary, is a payment 
under a social security leveling option 
which accelerates payments under the plan 
before, and reduces payments after, a par-
ticipant starts receiving social security ben-
efits in order to provide substantially simi-
lar aggregate payments both before and 
after such benefits are received, and 
‘‘(ii) subsection (e).’’. 
(b) INTERACTION WITH WRERA RULE.—Section 203 
of the Worker, Retiree, and Employer Recovery Act of 2008 
shall apply to a plan for any plan year in lieu of the 
amendments made by this section applying to sections 
206(g)(4) of the Employee Retirement Income Security Act 
of 1974 and 436(e) of the Internal Revenue Code of 1986
132 
† HR 4213 EAS 
only to the extent that such section produces a higher ad-
justed funding target attainment percentage for such plan 
for such year. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section shall 
apply to plan years beginning on or after October 1, 
2008. 
(2) SPECIAL RULE.—In the case of a plan for 
which the valuation date is not the first day of the 
plan year, the amendments made by this section shall 
apply to plan years beginning after December 31, 
2007. 
SEC. 304. LOOKBACK FOR CREDIT BALANCE RULE FOR 
PLANS MAINTAINED BY CHARITIES. 
(a) AMENDMENT TO ERISA.—Paragraph (3) of section 
303(f) of the Employee Retirement Income Security Act of 
1974 is amended by adding the following at the end thereof: 
‘‘(D) SPECIAL RULE FOR CERTAIN YEARS 
OF PLANS MAINTAINED BY CHARITIES.— 
‘‘(i) IN GENERAL.—For purposes of ap-
plying subparagraph (C) for plan years be-
ginning after August 31, 2009, and before 
September 1, 2011, the ratio determined
133 
† HR 4213 EAS 
under such subparagraph for the preceding 
plan year shall be the greater of— 
‘‘(I) such ratio, as determined 
without regard to this subparagraph, 
or 
‘‘(II) the ratio for such plan for 
the plan year beginning after August 
31, 2007, and before September 1, 
2008, as determined under rules pre-
scribed by the Secretary of the Treas-
ury. 
‘‘(ii) SPECIAL RULE.—In the case of a 
plan for which the valuation date is not the 
first day of the plan year— 
‘‘(I) clause (i) shall apply to plan 
years beginning after December 31, 
2008, and before January 1, 2011, and 
‘‘(II) clause (i)(II) shall apply 
based on the last plan year beginning 
before September 1, 2007, as deter-
mined under rules prescribed by the 
Secretary of the Treasury. 
‘‘(iii) LIMITATION
TO
CHARITIES.— 
This subparagraph shall not apply to any 
plan unless such plan is maintained exclu-
134 
† HR 4213 EAS 
sively by one or more organizations de-
scribed in section 501(c)(3) of the Internal 
Revenue Code of 1986.’’. 
(b) AMENDMENT TO INTERNAL REVENUE CODE OF 
1986.—Paragraph (3) of section 430(f) of the Internal Rev-
enue Code of 1986 is amended by adding the following at 
the end thereof: 
‘‘(D) SPECIAL RULE FOR CERTAIN YEARS 
OF PLANS MAINTAINED BY CHARITIES.— 
‘‘(i) IN GENERAL.—For purposes of ap-
plying subparagraph (C) for plan years be-
ginning after August 31, 2009, and before 
September 1, 2011, the ratio determined 
under such subparagraph for the preceding 
plan year of a plan shall be the greater of— 
‘‘(I) such ratio, as determined 
without regard to this subsection, or 
‘‘(II) the ratio for such plan for 
the plan year beginning after August 
31, 2007 and before September 1, 2008, 
as determined under rules prescribed 
by the Secretary. 
‘‘(ii) SPECIAL RULE.—In the case of a 
plan for which the valuation date is not the 
first day of the plan year—
135 
† HR 4213 EAS 
‘‘(I) clause (i) shall apply to plan 
years beginning after December 31, 
2007, and before January 1, 2010, and 
‘‘(II) clause (i)(II) shall apply 
based on the last plan year beginning 
before September 1, 2007, as deter-
mined under rules prescribed by the 
Secretary. 
‘‘(iii) LIMITATION
TO
CHARITIES.— 
This subparagraph shall not apply to any 
plan unless such plan is maintained exclu-
sively by one or more organizations de-
scribed in section 501(c)(3).’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section shall 
apply to plan years beginning after August 31, 2009. 
(2) SPECIAL RULE.—In the case of a plan for 
which the valuation date is not the first day of the 
plan year, the amendments made by this section shall 
apply to plan years beginning after December 31, 
2008.
136 
† HR 4213 EAS 
Subtitle B—Multiemployer Plans 
SEC. 311. ADJUSTMENTS TO FUNDING STANDARD ACCOUNT 
RULES. 
(a) ADJUSTMENTS.— 
(1) AMENDMENT TO ERISA.—Section 304(b) of 
the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1084(b)) is amended by adding at 
the end the following new paragraph: 
‘‘(8) SPECIAL RELIEF RULES.—Notwithstanding 
any other provision of this subsection— 
‘‘(A) AMORTIZATION OF NET INVESTMENT 
LOSSES.— 
‘‘(i) IN
GENERAL.—A multiemployer 
plan with respect to which the solvency test 
under subparagraph (C) is met may treat 
the portion of any experience loss or gain 
attributable to net investment losses in-
curred in either or both of the first two plan 
years ending after August 31, 2008, as an 
item separate from other experience losses, 
to be amortized in equal annual install-
ments (until fully amortized) over the pe-
riod — 
‘‘(I) beginning with the plan year 
in which such portion is first recog-
137 
† HR 4213 EAS 
nized in the actuarial value of assets, 
and 
‘‘(II) ending with the last plan 
year in the 30-plan year period begin-
ning with the plan year in which such 
net investment loss was incurred. 
‘‘(ii) COORDINATION
WITH
EXTEN-
SIONS.—If this subparagraph applies for 
any plan year— 
‘‘(I) no extension of the amortiza-
tion period under clause (i) shall be al-
lowed under subsection (d), and 
‘‘(II) if an extension was granted 
under subsection (d) for any plan year 
before the election to have this subpara-
graph apply to the plan year, such ex-
tension shall not result in such amorti-
zation period exceeding 30 years. 
‘‘(iii) NET INVESTMENT LOSSES.—For 
purposes of this subparagraph— 
‘‘(I) IN
GENERAL.—Net invest-
ment losses shall be determined in the 
manner prescribed by the Secretary of 
the Treasury on the basis of the dif-
ference between actual and expected re-
138 
† HR 4213 EAS 
turns (including any difference attrib-
utable to any criminally fraudulent in-
vestment arrangement). 
‘‘(II) CRIMINALLY
FRAUDULENT 
INVESTMENT ARRANGEMENTS.—The de-
termination as to whether an arrange-
ment is a criminally fraudulent invest-
ment arrangement shall be made under 
rules substantially similar to the rules 
prescribed by the Secretary of the 
Treasury for purposes of section 165 of 
the Internal Revenue Code of 1986. 
‘‘(B) EXPANDED SMOOTHING PERIOD.— 
‘‘(i) IN
GENERAL.—A multiemployer 
plan with respect to which the solvency test 
under subparagraph (C) is met may change 
its asset valuation method in a manner 
which— 
‘‘(I) spreads the difference between 
expected and actual returns for either 
or both of the first 2 plan years ending 
after August 31, 2008, over a period of 
not more than 10 years, 
‘‘(II) provides that for either or 
both of the first 2 plan years beginning
139 
† HR 4213 EAS 
after August 31, 2008, the value of 
plan assets at any time shall not be 
less than 80 percent or greater than 
130 percent of the fair market value of 
such assets at such time, or 
‘‘(III) makes both changes de-
scribed in subclauses (I) and (II) to 
such method. 
‘‘(ii) ASSET VALUATION METHODS.—If 
this subparagraph applies for any plan 
year— 
‘‘(I) the Secretary of the Treasury 
shall not treat the asset valuation 
method of the plan as unreasonable 
solely because of the changes in such 
method described in clause (i), and 
‘‘(II) such changes shall be deemed 
approved by such Secretary under sec-
tion 302(d)(1) and section 412(d)(1) of 
such Code. 
‘‘(iii) AMORTIZATION
OF
REDUCTION 
IN UNFUNDED ACCRUED LIABILITY.—If this 
subparagraph and subparagraph (A) both 
apply for any plan year, the plan shall 
treat any reduction in unfunded accrued li-
140 
† HR 4213 EAS 
ability resulting from the application of 
this subparagraph as a separate experience 
amortization base, to be amortized in equal 
annual installments (until fully amortized) 
over a period of 30 plan years rather than 
the period such liability would otherwise be 
amortized over. 
‘‘(C) SOLVENCY
TEST.—The solvency test 
under this paragraph is met only if the plan ac-
tuary certifies that the plan is projected to have 
sufficient assets to timely pay expected benefits 
and anticipated expenditures over the amortiza-
tion period, taking into account the changes in 
the funding standard account under this para-
graph. 
‘‘(D) 
RESTRICTION
ON
BENEFIT
IN-
CREASES.—If subparagraph (A) or (B) apply to 
a multiemployer plan for any plan year, then, 
in addition to any other applicable restrictions 
on benefit increases, a plan amendment increas-
ing benefits may not go into effect during either 
of the 2 plan years immediately following such 
plan year unless— 
‘‘(i) the plan actuary certifies that—
141 
† HR 4213 EAS 
‘‘(I) any such increase is paid for 
out of additional contributions not al-
located to the plan immediately before 
the application of this paragraph to 
the plan, and 
‘‘(II) the plan’s funded percentage 
and projected credit balances for such 2 
plan years are reasonably expected to 
be at least as high as such percentage 
and balances would have been if the 
benefit increase had not been adopted, 
or 
‘‘(ii) the amendment is required as a 
condition of qualification under part I of 
subchapter D of chapter 1 of the Internal 
Revenue Code of 1986 or to comply with 
other applicable law. 
‘‘(E) REPORTING.—A plan sponsor of a 
plan to which this paragraph applies shall— 
‘‘(i) give notice of such application to 
participants and beneficiaries of the plan, 
and 
‘‘(ii) inform the Pension Benefit Guar-
anty Corporation of such application in 
such form and manner as the Director of
142 
† HR 4213 EAS 
the Pension Benefit Guaranty Corporation 
may prescribe.’’. 
(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Section 431(b) is amended by adding at the 
end the following new paragraph: 
‘‘(8) SPECIAL RELIEF RULES.—Notwithstanding 
any other provision of this subsection— 
‘‘(A) AMORTIZATION OF NET INVESTMENT 
LOSSES.— 
‘‘(i) IN
GENERAL.—A multiemployer 
plan with respect to which the solvency test 
under subparagraph (C) is met may treat 
the portion of any experience loss or gain 
attributable to net investment losses in-
curred in either or both of the first two plan 
years ending after August 31, 2008, as an 
item separate from other experience losses, 
to be amortized in equal annual install-
ments (until fully amortized) over the pe-
riod — 
‘‘(I) beginning with the plan year 
in which such portion is first recog-
nized in the actuarial value of assets, 
and
143 
† HR 4213 EAS 
‘‘(II) ending with the last plan 
year in the 30-plan year period begin-
ning with the plan year in which such 
net investment loss was incurred. 
‘‘(ii) COORDINATION
WITH
EXTEN-
SIONS.—If this subparagraph applies for 
any plan year— 
‘‘(I) no extension of the amortiza-
tion period under clause (i) shall be al-
lowed under subsection (d), and 
‘‘(II) if an extension was granted 
under subsection (d) for any plan year 
before the election to have this subpara-
graph apply to the plan year, such ex-
tension shall not result in such amorti-
zation period exceeding 30 years. 
‘‘(iii) NET INVESTMENT LOSSES.—For 
purposes of this subparagraph— 
‘‘(I) IN
GENERAL.—Net invest-
ment losses shall be determined in the 
manner prescribed by the Secretary on 
the basis of the difference between ac-
tual and expected returns (including 
any difference attributable to any
144 
† HR 4213 EAS 
criminally fraudulent investment ar-
rangement). 
‘‘(II) CRIMINALLY
FRAUDULENT 
INVESTMENT ARRANGEMENTS.—The de-
termination as to whether an arrange-
ment is a criminally fraudulent invest-
ment arrangement shall be made under 
rules substantially similar to the rules 
prescribed by the Secretary for pur-
poses of section 165. 
‘‘(B) EXPANDED SMOOTHING PERIOD.— 
‘‘(i) IN
GENERAL.—A multiemployer 
plan with respect to which the solvency test 
under subparagraph (C) is met may change 
its asset valuation method in a manner 
which— 
‘‘(I) spreads the difference between 
expected and actual returns for either 
or both of the first 2 plan years ending 
after August 31, 2008, over a period of 
not more than 10 years, 
‘‘(II) provides that for either or 
both of the first 2 plan years beginning 
after August 31, 2008, the value of 
plan assets at any time shall not be
145 
† HR 4213 EAS 
less than 80 percent or greater than 
130 percent of the fair market value of 
such assets at such time, or 
‘‘(III) makes both changes de-
scribed in subclauses (I) and (II) to 
such method. 
‘‘(ii) ASSET VALUATION METHODS.—If 
this subparagraph applies for any plan 
year— 
‘‘(I) the Secretary shall not treat 
the asset valuation method of the plan 
as unreasonable solely because of the 
changes in such method described in 
clause (i), and 
‘‘(II) such changes shall be deemed 
approved by the Secretary under sec-
tion 302(d)(1) of the Employee Retire-
ment Income Security Act of 1974 and 
section 412(d)(1). 
‘‘(iii) AMORTIZATION
OF
REDUCTION 
IN UNFUNDED ACCRUED LIABILITY.—If this 
subparagraph and subparagraph (A) both 
apply for any plan year, the plan shall 
treat any reduction in unfunded accrued li-
ability resulting from the application of
146 
† HR 4213 EAS 
this subparagraph as a separate experience 
amortization base, to be amortized in equal 
annual installments (until fully amortized) 
over a period of 30 plan years rather than 
the period such liability would otherwise be 
amortized over. 
‘‘(C) SOLVENCY
TEST.—The solvency test 
under this paragraph is met only if the plan ac-
tuary certifies that the plan is projected to have 
sufficient assets to timely pay expected benefits 
and anticipated expenditures over the amortiza-
tion period, taking into account the changes in 
the funding standard account under this para-
graph. 
‘‘(D) 
RESTRICTION
ON
BENEFIT
IN-
CREASES.—If subparagraph (A) or (B) apply to 
a multiemployer plan for any plan year, then, 
in addition to any other applicable restrictions 
on benefit increases, a plan amendment increas-
ing benefits may not go into effect during either 
of the 2 plan years immediately following such 
plan year unless— 
‘‘(i) the plan actuary certifies that— 
‘‘(I) any such increase is paid for 
out of additional contributions not al-
147 
† HR 4213 EAS 
located to the plan immediately before 
the application of this paragraph to 
the plan, and 
‘‘(II) the plan’s funded percentage 
and projected credit balances for such 2 
plan years are reasonably expected to 
be at least as high as such percentage 
and balances would have been if the 
benefit increase had not been adopted, 
or 
‘‘(ii) the amendment is required as a 
condition of qualification under part I of 
subchapter D or to comply with other appli-
cable law. 
‘‘(E) REPORTING.—A plan sponsor of a 
plan to which this paragraph applies shall— 
‘‘(i) give notice of such application to 
participants and beneficiaries of the plan, 
and 
‘‘(ii) inform the Pension Benefit Guar-
anty Corporation of such application in 
such form and manner as the Director of 
the Pension Benefit Guaranty Corporation 
may prescribe.’’. 
(b) EFFECTIVE DATES.—
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† HR 4213 EAS 
(1) IN
GENERAL.—The amendments made by 
this section shall take effect as of the first day of the 
first plan year ending after August 31, 2008, except 
that any election a plan makes pursuant to this sec-
tion that affects the plan’s funding standard account 
for the first plan year beginning after August 31, 
2008, shall be disregarded for purposes of applying 
the provisions of section 305 of the Employee Retire-
ment Income Security Act of 1974 and section 432 of 
the Internal Revenue Code of 1986 to such plan year. 
(2) RESTRICTIONS
ON
BENEFIT
INCREASES.— 
Notwithstanding paragraph (1), the restrictions on 
plan amendments increasing benefits in sections 
304(b)(8)(D) of such Act and 431(b)(8)(D) of such 
Code, as added by this section, shall take effect on the 
date of enactment of this Act. 
TITLE IV—OFFSET PROVISIONS 
Subtitle A—Black Liquor 
SEC. 401. EXCLUSION OF UNPROCESSED FUELS FROM THE 
CELLULOSIC BIOFUEL PRODUCER CREDIT. 
(a) IN
GENERAL.—Subparagraph (E) of section 
40(b)(6) is amended by adding at the end the following new 
clause:
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† HR 4213 EAS 
‘‘(iii) EXCLUSION
OF
UNPROCESSED 
FUELS.—The term ‘cellulosic biofuel’ shall 
not include any fuel if— 
‘‘(I) more than 4 percent of such 
fuel (determined by weight) is any 
combination of water and sediment, or 
‘‘(II) the ash content of such fuel 
is more than 1 percent (determined by 
weight).’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to fuels sold or used after the date of 
the enactment of this Act. 
SEC. 402. PROHIBITION ON ALTERNATIVE FUEL CREDIT 
AND ALTERNATIVE FUEL MIXTURE CREDIT 
FOR BLACK LIQUOR. 
(a) IN
GENERAL.—The last sentence of section 
6426(d)(2) is amended by striking ‘‘or biodiesel’’ and in-
serting ‘‘biodiesel, or any fuel (including lignin, wood resi-
dues, or spent pulping liquors) derived from the production 
of paper or pulp’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to fuel sold or used after December 31, 
2009.
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Subtitle B—Homebuyer Credit 
SEC. 411. TECHNICAL MODIFICATIONS TO HOMEBUYER 
CREDIT. 
(a) EXPANDED DOCUMENTATION REQUIREMENT.— 
Subsection (d) of section 36, as amended by the Worker, 
Homeownership, and Business Assistance Act of 2009, is 
amended— 
(1) by striking ‘‘or’’ at the end of paragraph (3), 
(2) by striking the period at the end of para-
graph (4) and inserting a comma, and 
(3) by adding at the end the following new para-
graphs: 
‘‘(5) in the case of a taxpayer to whom such a 
credit would be allowed (but for this paragraph) by 
reason of subsection (c)(6), the taxpayer fails to at-
tach to the return of tax for such taxable year a copy 
of such property tax bills or other documentation as 
are required by the Secretary to demonstrate compli-
ance with the requirements of subsection (c)(6), or 
‘‘(6) in the case of a taxpayer to whom such a 
credit would be allowed (but for this paragraph) by 
reason of subsection (h)(2), the taxpayer fails to at-
tach to the return of tax for such taxable year a copy 
of the binding contract which meets the requirements 
of subsection (h)(2).’’.
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† HR 4213 EAS 
‘‘(B) TREATMENT OF FEES AND FOREIGN 
TAXES.—Fees and other transaction expenses 
shall be taken into account as expenses in deter-
mining pre-tax profit under subparagraph (A). 
The Secretary may issue regulations requiring 
foreign taxes to be treated as expenses in deter-
mining pre-tax profit in appropriate cases. 
‘‘(3) STATE
AND
LOCAL
TAX
BENEFITS.—For 
purposes of paragraph (1), any State or local income 
tax effect which is related to a Federal income tax ef-
fect shall be treated in the same manner as a Federal 
income tax effect. 
‘‘(4) FINANCIAL
ACCOUNTING
BENEFITS.—For 
purposes of paragraph (1)(B), achieving a financial 
accounting benefit shall not be taken into account as 
a purpose for entering into a transaction if the origin 
of such financial accounting benefit is a reduction of 
Federal income tax. 
‘‘(5) DEFINITIONS
AND
SPECIAL
RULES.—For 
purposes of this subsection— 
‘‘(A) ECONOMIC
SUBSTANCE
DOCTRINE.— 
The term ‘economic substance doctrine’ means 
the common law doctrine under which tax bene-
fits under subtitle A with respect to a trans-
action are not allowable if the transaction does
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† HR 4213 EAS 
not have economic substance or lacks a business 
purpose. 
‘‘(B) EXCEPTION
FOR
PERSONAL
TRANS-
ACTIONS OF INDIVIDUALS.—In the case of an in-
dividual, paragraph (1) shall apply only to 
transactions entered into in connection with a 
trade or business or an activity engaged in for 
the production of income. 
‘‘(C) OTHER COMMON LAW DOCTRINES NOT 
AFFECTED.—Except as specifically provided in 
this subsection, the provisions of this subsection 
shall not be construed as altering or supplanting 
any other rule of law, and the requirements of 
this subsection shall be construed as being in ad-
dition to any such other rule of law. 
‘‘(D) DETERMINATION OF APPLICATION OF 
DOCTRINE
NOT
AFFECTED.—The determination 
of whether the economic substance doctrine is rel-
evant to a transaction shall be made in the same 
manner as if this subsection had never been en-
acted. 
‘‘(E) 
TRANSACTION.—The 
term 
‘trans-
action’ includes a series of transactions.
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† HR 4213 EAS 
‘‘(6) REGULATIONS.—The Secretary shall pre-
scribe such regulations as may be necessary or appro-
priate to carry out the purposes of this subsection.’’. 
(b) PENALTY FOR UNDERPAYMENTS ATTRIBUTABLE 
TO TRANSACTIONS LACKING ECONOMIC SUBSTANCE.— 
(1) IN GENERAL.—Subsection (b) of section 6662 
is amended by inserting after paragraph (5) the fol-
lowing new paragraph: 
‘‘(6) Any disallowance of claimed tax benefits by 
reason of a transaction lacking economic substance 
(within the meaning of section 7701(o)) or failing to 
meet the requirements of any similar rule of law.’’. 
(2) INCREASED
PENALTY
FOR
NONDISCLOSED 
TRANSACTIONS.—Section 6662 is amended by adding 
at the end the following new subsection: 
‘‘(i) INCREASE
IN PENALTY
IN CASE
OF NONDIS-
CLOSED NONECONOMIC SUBSTANCE TRANSACTIONS.— 
‘‘(1) IN GENERAL.—In the case of any portion of 
an underpayment which is attributable to one or 
more nondisclosed noneconomic substance trans-
actions, subsection (a) shall be applied with respect to 
such portion by substituting ‘40 percent’ for ‘20 per-
cent’. 
‘‘(2) NONDISCLOSED NONECONOMIC SUBSTANCE 
TRANSACTIONS.—For purposes of this subsection, the
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† HR 4213 EAS 
term ‘nondisclosed noneconomic substance trans-
action’ means any portion of a transaction described 
in subsection (b)(6) with respect to which the relevant 
facts affecting the tax treatment are not adequately 
disclosed in the return nor in a statement attached to 
the return. 
‘‘(3) SPECIAL RULE FOR AMENDED RETURNS.— 
Except as provided in regulations, in no event shall 
any amendment or supplement to a return of tax be 
taken into account for purposes of this subsection if 
the amendment or supplement is filed after the earlier 
of the date the taxpayer is first contacted by the Sec-
retary regarding the examination of the return or 
such other date as is specified by the Secretary.’’. 
(3) CONFORMING
AMENDMENT.—Subparagraph 
(B) of section 6662A(e)(2) is amended— 
(A) by striking ‘‘section 6662(h)’’ and in-
serting ‘‘subsections (h) or (i) of section 6662’’; 
and 
(B) 
by 
striking 
‘‘GROSS
VALUATION 
MISSTATEMENT
PENALTY’’ in the heading and 
inserting ‘‘CERTAIN INCREASED UNDERPAYMENT 
PENALTIES’’. 
(c) REASONABLE CAUSE EXCEPTION NOT APPLICABLE 
TO NONECONOMIC SUBSTANCE TRANSACTIONS.—
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† HR 4213 EAS 
(1) REASONABLE CAUSE EXCEPTION FOR UNDER-
PAYMENTS.—Subsection (c) of section 6664 is amend-
ed— 
(A) by redesignating paragraphs (2) and 
(3) as paragraphs (3) and (4), respectively; 
(B) by striking ‘‘paragraph (2)’’ in para-
graph (4)(A), as so redesignated, and inserting 
‘‘paragraph (3)’’; and 
(C) by inserting after paragraph (1) the fol-
lowing new paragraph: 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply to any portion of an underpayment which is 
attributable to one or more transactions described in 
section 6662(b)(6).’’. 
(2) REASONABLE
CAUSE
EXCEPTION
FOR
RE-
PORTABLE
TRANSACTION
UNDERSTATEMENTS.—Sub-
section (d) of section 6664 is amended— 
(A) by redesignating paragraphs (2) and 
(3) as paragraphs (3) and (4), respectively; 
(B) by striking ‘‘paragraph (2)(C)’’ in 
paragraph (4), as so redesignated, and inserting 
‘‘paragraph (3)(C)’’; and 
(C) by inserting after paragraph (1) the fol-
lowing new paragraph:
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† HR 4213 EAS 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply to any portion of a reportable transaction un-
derstatement which is attributable to one or more 
transactions described in section 6662(b)(6).’’. 
(d) APPLICATION OF PENALTY FOR ERRONEOUS CLAIM 
FOR REFUND OR CREDIT TO NONECONOMIC SUBSTANCE 
TRANSACTIONS.—Section 6676 is amended by redesig-
nating subsection (c) as subsection (d) and inserting after 
subsection (b) the following new subsection: 
‘‘(c) 
NONECONOMIC
SUBSTANCE
TRANSACTIONS 
TREATED AS LACKING REASONABLE BASIS.—For purposes 
of this section, any excessive amount which is attributable 
to any transaction described in section 6662(b)(6) shall not 
be treated as having a reasonable basis.’’. 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall apply to transactions entered into after the 
date of the enactment of this Act. 
(2) UNDERPAYMENTS.—The amendments made 
by subsections (b) and (c)(1) shall apply to underpay-
ments attributable to transactions entered into after 
the date of the enactment of this Act. 
(3) 
UNDERSTATEMENTS.—The 
amendments 
made by subsection (c)(2) shall apply to understate-
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† HR 4213 EAS 
ments attributable to transactions entered into after 
the date of the enactment of this Act. 
(4) REFUNDS
AND
CREDITS.—The amendment 
made by subsection (d) shall apply to refunds and 
credits attributable to transactions entered into after 
the date of the enactment of this Act. 
Subtitle D—Additional Provisions 
SEC. 431. REVISION TO THE MEDICARE IMPROVEMENT 
FUND. 
Section 1898(b)(1)(A) of the Social Security Act (42 
U.S.C. 1395iii(b)(1)(A)), as amended by section 1011(b) of 
the Department of Defense Appropriations Act, 2010 (Pub-
lic 
Law 
111–118), 
is 
amended 
by 
striking 
‘‘$20,740,000,000’’ and inserting ‘‘$12,740,000,000’’. 
TITLE V—SATELLITE 
TELEVISION EXTENSION 
SEC. 500. SHORT TITLE. 
This title may be cited as the ‘‘Satellite Television Ex-
tension and Localism Act of 2010’’. 
Subtitle A—Statutory Licenses 
SEC. 501. REFERENCE. 
Except as otherwise provided, whenever in this subtitle 
an amendment is made to a section or other provision, the 
reference shall be considered to be made to such section or 
provision of title 17, United States Code.
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† HR 4213 EAS 
SEC. 502. MODIFICATIONS TO STATUTORY LICENSE FOR 
SATELLITE CARRIERS. 
(a) HEADING RENAMED.— 
(1) IN GENERAL.—The heading of section 119 is 
amended by striking ‘‘superstations and net-
work stations for private home viewing’’ 
and inserting ‘‘distant television program-
ming by satellite’’. 
(2) TABLE OF CONTENTS.—The table of contents 
for chapter 1 is amended by striking the item relating 
to section 119 and inserting the following: 
‘‘119. Limitations on exclusive rights: Secondary transmissions of distant tele-
vision programming by satellite.’’. 
(b) UNSERVED HOUSEHOLD DEFINED.— 
(1) IN GENERAL.—Section 119(d)(10) is amend-
ed— 
(A) by striking subparagraph (A) and in-
serting the following: 
‘‘(A) cannot receive, through the use of an 
antenna, an over-the-air signal containing the 
primary stream, or, on or after the qualifying 
date, the multicast stream, originating in that 
household’s local market and affiliated with that 
network of— 
‘‘(i) if the signal originates as an ana-
log signal, Grade B intensity as defined by
161 
† HR 4213 EAS 
the Federal Communications Commission 
in section 73.683(a) of title 47, Code of Fed-
eral Regulations, as in effect on January 1, 
1999; or 
‘‘(ii) if the signal originates as a dig-
ital signal, intensity defined in the values 
for the digital television noise-limited serv-
ice contour, as defined in regulations issued 
by the Federal Communications Commis-
sion (section 73.622(e) of title 47, Code of 
Federal Regulations), as such regulations 
may be amended from time to time;’’; 
(B) in subparagraph (B)— 
(i) by striking ‘‘subsection (a)(14)’’ 
and inserting ‘‘subsection (a)(13),’’; and 
(ii) by striking ‘‘Satellite Home Viewer 
Extension and Reauthorization Act of 
2004’’ and inserting ‘‘Satellite Television 
Extension and Localism Act of 2010’’; and 
(C) in subparagraph (D), by striking 
‘‘(a)(12)’’ and inserting ‘‘(a)(11)’’. 
(2) QUALIFYING DATE DEFINED.—Section 119(d) 
is amended by adding at the end the following: 
‘‘(14) QUALIFYING DATE.—The term ‘qualifying 
date’, for purposes of paragraph (10)(A), means—
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† HR 4213 EAS 
‘‘(A) July 1, 2010, for multicast streams 
that exist on December 31, 2009; and 
‘‘(B) January 1, 2011, for all other 
multicast streams.’’. 
(c) FILING FEE.—Section 119(b)(1) is amended— 
(1) in subparagraph (A), by striking ‘‘and’’ after 
the semicolon at the end; 
(2) in subparagraph (B), by striking the period 
and inserting ‘‘; and’’; and 
(3) by adding at the end the following: 
‘‘(C) a filing fee, as determined by the Reg-
ister of Copyrights pursuant to section 708(a).’’. 
(d) 
DEPOSIT
OF
STATEMENTS
AND
FEES; 
VERIFICATION PROCEDURES.—Section 119(b) is amend-
ed— 
(1) by amending the subsection heading to read 
as follows: ‘‘(b) DEPOSIT OF STATEMENTS AND FEES; 
VERIFICATION PROCEDURES.—’’; 
(2) in paragraph (1), by striking subparagraph 
(B) and inserting the following: 
‘‘(B) a royalty fee payable to copyright 
owners pursuant to paragraph (4) for that 6- 
month period, computed by multiplying the total 
number of subscribers receiving each secondary 
transmission of a primary stream or multicast
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† HR 4213 EAS 
stream of each non-network station or network 
station during each calendar year month by the 
appropriate rate in effect under this subsection; 
and’’; 
(3) by redesignating paragraphs (2), (3), and (4) 
as paragraphs (3), (4), and (5), respectively; 
(4) by inserting after paragraph (1) the fol-
lowing: 
‘‘(2) VERIFICATION OF ACCOUNTS AND FEE PAY-
MENTS.—The Register of Copyrights shall issue regu-
lations to permit interested parties to verify and 
audit the statements of account and royalty fees sub-
mitted by satellite carriers under this subsection.’’; 
(5) in paragraph (3), as redesignated, in the 
first sentence— 
(A) by inserting ‘‘(including the filing fee 
specified in paragraph (1)(C))’’ after ‘‘shall re-
ceive all fees’’; and 
(B) by striking ‘‘paragraph (4)’’ and insert-
ing ‘‘paragraph (5)’’; 
(6) in paragraph (4), as redesignated— 
(A) by striking ‘‘paragraph (2)’’ and insert-
ing ‘‘paragraph (3)’’; and 
(B) by striking ‘‘paragraph (4)’’ each place 
it appears and inserting ‘‘paragraph (5)’’; and
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† HR 4213 EAS 
(7) in paragraph (5), as redesignated, by strik-
ing ‘‘paragraph (2)’’ and inserting ‘‘paragraph (3)’’. 
(e) ADJUSTMENT OF ROYALTY FEES.—Section 119(c) 
is amended as follows: 
(1) Paragraph (1) is amended— 
(A) in the heading for such paragraph, by 
striking ‘‘ANALOG’’; 
(B) in subparagraph (A)— 
(i) by striking ‘‘primary analog trans-
missions’’ and inserting ‘‘primary trans-
missions’’; and 
(ii) by striking ‘‘July 1, 2004’’ and in-
serting ‘‘July 1, 2009’’; 
(C) in subparagraph (B)— 
(i) by striking ‘‘January 2, 2005, the 
Librarian of Congress’’ and inserting ‘‘May 
1, 2010, the Copyright Royalty Judges’’; 
and 
(ii) by striking ‘‘primary analog 
transmission’’ 
and 
inserting 
‘‘primary 
transmissions’’; 
(D) in subparagraph (C), by striking ‘‘Li-
brarian of Congress’’ and inserting ‘‘Copyright 
Royalty Judges’’; 
(E) in subparagraph (D)—
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† HR 4213 EAS 
(i) in clause (i)— 
(I) by striking ‘‘(i) Voluntary 
agreements’’ and inserting the fol-
lowing: 
‘‘(i) VOLUNTARY
AGREEMENTS; FIL-
ING.—Voluntary agreements’’; and 
(II) by striking ‘‘that a parties’’ 
and inserting ‘‘that are parties’’; and 
(ii) in clause (ii)— 
(I) by striking ‘‘(ii)(I) Within’’ 
and inserting the following: 
‘‘(ii) PROCEDURE
FOR
ADOPTION
OF 
FEES.— 
‘‘(I) PUBLICATION OF NOTICE.— 
Within’’; 
(II) in subclause (I), by striking 
‘‘an arbitration proceeding pursuant to 
subparagraph (E)’’ and inserting ‘‘a 
proceeding under subparagraph (F)’’; 
(III) in subclause (II), by striking 
‘‘(II) Upon receiving a request under 
subclause (I), the Librarian of Con-
gress’’ and inserting the following: 
‘‘(II) PUBLIC NOTICE OF FEES.— 
Upon receiving a request under sub-
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† HR 4213 EAS 
clause (I), the Copyright Royalty 
Judges’’; and 
(IV) in subclause (III)— 
(aa) by striking ‘‘(III) The 
Librarian’’ and inserting the fol-
lowing: 
‘‘(III) ADOPTION OF FEES.—The 
Copyright Royalty Judges’’; 
(bb) by striking ‘‘an arbitra-
tion proceeding’’ and inserting 
‘‘the proceeding under subpara-
graph (F)’’; and 
(cc) by striking ‘‘the arbitra-
tion proceeding’’ and inserting 
‘‘that proceeding’’; 
(F) in subparagraph (E)— 
(i) by striking ‘‘Copyright Office’’ and 
inserting ‘‘Copyright Royalty Judges’’; and 
(ii) by striking ‘‘March 28, 2010’’ and 
inserting ‘‘December 31, 2014’’; and 
(G) in subparagraph (F)— 
(i) in the heading, by striking ‘‘COM-
PULSORY
ARBITRATION’’ 
and 
inserting 
‘‘COPYRIGHT
ROYALTY
JUDGES
PRO-
CEEDING’’;
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† HR 4213 EAS 
(ii) in clause (i)— 
(I) in the heading, by striking 
‘‘PROCEEDINGS’’ and inserting ‘‘THE 
PROCEEDING’’; 
(II) in the matter preceding sub-
clause (I)— 
(aa) by striking ‘‘May 1, 
2005, the Librarian of Congress’’ 
and inserting ‘‘July 1, 2010, the 
Copyright Royalty Judges’’; 
(bb) by striking ‘‘arbitration 
proceedings’’ and inserting ‘‘a 
proceeding’’; 
(cc) by striking ‘‘fee to be 
paid’’ and inserting ‘‘fees to be 
paid’’; 
(dd) by striking ‘‘primary 
analog transmission’’ and insert-
ing ‘‘the primary transmissions’’; 
and 
(ee) by striking ‘‘distribu-
tors’’ and inserting ‘‘distribu-
tors—’’; 
(III) in subclause (II)—
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† HR 4213 EAS 
(aa) by striking ‘‘Librarian 
of Congress’’ and inserting ‘‘Copy-
right Royalty Judges’’; and 
(bb) by striking ‘‘arbitra-
tion’’; and 
(IV) by amending the last sen-
tence to read as follows: ‘‘Such pro-
ceeding shall be conducted under chap-
ter 8.’’; 
(iii) in clause (ii), by amending the 
matter preceding subclause (I) to read as 
follows: 
‘‘(ii) ESTABLISHMENT
OF
ROYALTY 
FEES.—In determining royalty fees under 
this subparagraph, the Copyright Royalty 
Judges shall establish fees for the secondary 
transmissions of the primary transmissions 
of network stations and non-network sta-
tions that most clearly represent the fair 
market value of secondary transmissions, 
except that the Copyright Royalty Judges 
shall adjust royalty fees to account for the 
obligations of the parties under any appli-
cable voluntary agreement filed with the 
Copyright Royalty Judges in accordance
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† HR 4213 EAS 
with subparagraph (D). In determining the 
fair market value, the Judges shall base 
their decision on economic, competitive, and 
programming information presented by the 
parties, including—’’; 
(iv) by amending clause (iii) to read 
as follows: 
‘‘(iii) EFFECTIVE DATE FOR DECISION 
OF COPYRIGHT ROYALTY JUDGES.—The obli-
gation to pay the royalty fees established 
under a determination that is made by the 
Copyright Royalty Judges in a proceeding 
under this paragraph shall be effective as of 
January 1, 2010.’’; and 
(v) in clause (iv)— 
(I) in the heading, by striking 
‘‘FEE’’ and inserting ‘‘FEES’’; and 
(II) by striking ‘‘fee referred to in 
(iii)’’ and inserting ‘‘fees referred to in 
clause (iii)’’. 
(2) Paragraph (2) is amended to read as follows: 
‘‘(2) ANNUAL ROYALTY FEE ADJUSTMENT.—Ef-
fective January 1 of each year, the royalty fee pay-
able under subsection (b)(1)(B) for the secondary 
transmission of the primary transmissions of network
170 
† HR 4213 EAS 
stations and non-network stations shall be adjusted by 
the Copyright Royalty Judges to reflect any changes 
occurring in the cost of living as determined by the 
most recent Consumer Price Index (for all consumers 
and for all items) published by the Secretary of Labor 
before December 1 of the preceding year. Notification 
of the adjusted fees shall be published in the Federal 
Register at least 25 days before January 1.’’. 
(f) DEFINITIONS.— 
(1) SUBSCRIBER.—Section 119(d)(8) is amended 
to read as follows: 
‘‘(8) SUBSCRIBER; SUBSCRIBE.— 
‘‘(A) SUBSCRIBER.—The term ‘subscriber’ 
means a person or entity that receives a sec-
ondary transmission service from a satellite car-
rier and pays a fee for the service, directly or in-
directly, to the satellite carrier or to a dis-
tributor. 
‘‘(B) SUBSCRIBE.—The term ‘subscribe’ 
means to elect to become a subscriber.’’. 
(2) LOCAL
MARKET.—Section 119(d)(11) is 
amended to read as follows: 
‘‘(11) LOCAL MARKET.—The term ‘local market’ 
has the meaning given such term under section 
122(j).’’.
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† HR 4213 EAS 
(3) LOW POWER TELEVISION STATION.—Section 
119(d) is amended by striking paragraph (12) and 
redesignating paragraphs (13) and (14) as para-
graphs (12) and (13), respectively. 
(4) MULTICAST
STREAM.—Section 119(d), as 
amended by paragraph (3), is further amended by 
adding at the end the following new paragraph: 
‘‘(14) MULTICAST STREAM.—The term ‘multicast 
stream’ means a digital stream containing program-
ming and program-related material affiliated with a 
television network, other than the primary stream.’’. 
(5) PRIMARY
STREAM.—Section 119(d), as 
amended by paragraph (4), is further amended by 
adding at the end the following new paragraph: 
‘‘(15) PRIMARY
STREAM.—The term ‘primary 
stream’ means— 
‘‘(A) the single digital stream of program-
ming as to which a television broadcast station 
has the right to mandatory carriage with a sat-
ellite carrier under the rules of the Federal Com-
munications Commission in effect on July 1, 
2009; or 
‘‘(B) if there is no stream described in sub-
paragraph (A), then either—
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† HR 4213 EAS 
‘‘(i) the single digital stream of pro-
gramming associated with the network last 
transmitted by the station as an analog sig-
nal; or 
‘‘(ii) if there is no stream described in 
clause (i), then the single digital stream of 
programming affiliated with the network 
that, as of July 1, 2009, had been offered by 
the television broadcast station for the long-
est period of time.’’. 
(6) CLERICAL AMENDMENT.—Section 119(d) is 
amended in paragraphs (1), (2), and (5) by striking 
‘‘which’’ each place it appears and inserting ‘‘that’’. 
(g) SUPERSTATION REDESIGNATED AS NON-NETWORK 
STATION.—Section 119 is amended— 
(1) by striking ‘‘superstation’’ each place it ap-
pears in a heading and each place it appears in text 
and inserting ‘‘non-network station’’; and 
(2) by striking ‘‘superstations’’ each place it ap-
pears in a heading and each place it appears in text 
and inserting ‘‘non-network stations’’. 
(h) REMOVAL OF CERTAIN PROVISIONS.— 
(1) REMOVAL OF PROVISIONS.—Section 119(a) is 
amended—
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† HR 4213 EAS 
(A) in paragraph (2), by striking subpara-
graph (C) and redesignating subparagraph (D) 
as subparagraph (C); 
(B) by striking paragraph (3) and redesig-
nating paragraphs (4) through (14) as para-
graphs (3) through (13), respectively; and 
(C) by striking paragraph (15) and redesig-
nating paragraph (16) as paragraph (14). 
(2) CONFORMING AMENDMENTS.—Section 119 is 
amended— 
(A) in subsection (a)— 
(i) in paragraph (1), by striking ‘‘(5), 
(6), and (8)’’ and inserting ‘‘(4), (5), and 
(7)’’; 
(ii) in paragraph (2)— 
(I) in subparagraph (A), by strik-
ing ‘‘subparagraphs (B) and (C) of 
this paragraph and paragraphs (5), 
(6), (7), and (8)’’ and inserting ‘‘sub-
paragraph (B) of this paragraph and 
paragraphs (4), (5), (6), and (7)’’; 
(II) in subparagraph (B)(i), by 
striking the second sentence; and
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† HR 4213 EAS 
(III) in subparagraph (C) (as re-
designated), by striking clauses (i) and 
(ii) and inserting the following: 
‘‘(i) INITIAL LISTS.—A satellite carrier 
that makes secondary transmissions of a 
primary transmission made by a network 
station pursuant to subparagraph (A) shall, 
not later than 90 days after commencing 
such secondary transmissions, submit to the 
network that owns or is affiliated with the 
network station a list identifying (by name 
and address, including street or rural route 
number, city, State, and 9-digit zip code) 
all subscribers to which the satellite carrier 
makes secondary transmissions of that pri-
mary 
transmission 
to 
subscribers 
in 
unserved households. 
‘‘(ii) MONTHLY LISTS.—After the sub-
mission of the initial lists under clause (i), 
the satellite carrier shall, not later than the 
15th of each month, submit to the network 
a list, aggregated by designated market 
area, identifying (by name and address, in-
cluding street or rural route number, city, 
State, and 9-digit zip code) any persons
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† HR 4213 EAS 
who have been added or dropped as sub-
scribers under clause (i) since the last sub-
mission under this subparagraph.’’; and 
(iii) in subparagraph (E) of para-
graph (3) (as redesignated)— 
(I) by striking ‘‘under paragraph 
(3) or’’; and 
(II) by striking ‘‘paragraph (12)’’ 
and inserting ‘‘paragraph (11)’’; and 
(B) in subsection (b)(1), by striking the 
final sentence. 
(i) MODIFICATIONS TO PROVISIONS FOR SECONDARY 
TRANSMISSIONS BY SATELLITE CARRIERS.— 
(1) 
PREDICTIVE
MODEL.—Section 
119(a)(2)(B)(ii) is amended by adding at the end the 
following: 
‘‘(III) 
ACCURATE
PREDICTIVE 
MODEL
WITH
RESPECT
TO
DIGITAL 
SIGNALS.—Notwithstanding subclause 
(I), 
in 
determining 
presumptively 
whether 
a 
person 
resides 
in 
an 
unserved household under subsection 
(d)(10)(A) with respect to digital sig-
nals, a court shall rely on a predictive 
model set forth by the Federal Commu-
176 
† HR 4213 EAS 
nications Commission pursuant to a 
rulemaking as provided in section 
339(c)(3) of the Communications Act 
of 1934 (47 U.S.C. 339(c)(3)), as that 
model may be amended by the Com-
mission over time under such section to 
increase the accuracy of that model. 
Until such time as the Commission sets 
forth such model, a court shall rely on 
the predictive model as recommended 
by the Commission with respect to dig-
ital signals in its Report to Congress 
in ET Docket No. 05–182, FCC 05– 
199 (released December 9, 2005).’’. 
(2) MODIFICATIONS
TO
STATUTORY
LICENSE 
WHERE
RETRANSMISSIONS
INTO
LOCAL
MARKET 
AVAILABLE.—Section 119(a)(3) (as redesignated) is 
amended— 
(A) by striking ‘‘analog’’ each place it ap-
pears in a heading and text; 
(B) by striking subparagraphs (B), (C), and 
(D), and inserting the following: 
‘‘(B) RULES FOR LAWFUL SUBSCRIBERS AS 
OF DATE OF ENACTMENT OF 2010 ACT.—In the 
case of a subscriber of a satellite carrier who, on
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† HR 4213 EAS 
the day before the date of the enactment of the 
Satellite Television Extension and Localism Act 
of 2010, was lawfully receiving the secondary 
transmission of the primary transmission of a 
network station under the statutory license under 
paragraph (2) (in this subparagraph referred to 
as the ‘distant signal’), other than subscribers to 
whom subparagraph (A) applies, the statutory 
license under paragraph (2) shall apply to sec-
ondary transmissions by that satellite carrier to 
that subscriber of the distant signal of a station 
affiliated with the same television network, and 
the subscriber’s household shall continue to be 
considered to be an unserved household with re-
spect to such network, until such time as the sub-
scriber elects to terminate such secondary trans-
missions, whether or not the subscriber elects to 
subscribe to receive the secondary transmission of 
the primary transmission of a local network sta-
tion affiliated with the same network pursuant 
to the statutory license under section 122. 
‘‘(C) FUTURE APPLICABILITY.— 
‘‘(i) WHEN LOCAL SIGNAL AVAILABLE 
AT TIME OF SUBSCRIPTION.—The statutory 
license under paragraph (2) shall not apply
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† HR 4213 EAS 
the Federal Communications Commission in ef-
fect on April 15, 1976, applicable to determining 
with respect to a cable system whether signals 
are significantly viewed in a community. 
‘‘(B) WAIVER.—A subscriber who is denied 
the secondary transmission of the primary trans-
mission of a network station or a non-network 
station under subparagraph (A) may request a 
waiver from such denial by submitting a request, 
through the subscriber’s satellite carrier, to the 
network station or non-network station in the 
local market affiliated with the same network or 
non-network where the subscriber is located. The 
network station or non-network station shall ac-
cept or reject the subscriber’s request for a waiver 
within 30 days after receipt of the request. If the 
network station or non-network station fails to 
accept or reject the subscriber’s request for a 
waiver within that 30-day period, that network 
station or non-network station shall be deemed to 
agree to the waiver request. 
‘‘(3) SECONDARY TRANSMISSION OF LOW POWER 
PROGRAMMING.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graphs (B) and (C), a secondary transmission of