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for the following plan year, such reasonable 
measures may also include— 
‘‘(i) a further reduction in the rate of 
future benefit accruals without regard to 
the limitation applicable under subpara-
graph (B)(ii), or 
‘‘(ii) a reduction of core benefits, 
provided that such reductions shall be equitably 
distributed across the participant and bene-
ficiary population, taking into account factors, 
with respect to participants and beneficiaries 
and their benefits, that may include one or 
more of the factors listed in subclauses (I) 
through (X) of section 432(e)(9)(D)(vi), to the 
extent necessary to enable the plan to achieve 
a projected funded ratio of at least 120 percent 
for the following plan year, or at the election of 
the plan sponsor, a projected funded ratio of at 
least 100 percent for the following plan year 
and a current funded ratio of at least 90 per-
cent. 
‘‘(3) ADJUSTABLE
BENEFIT
DEFINED.—For 
purposes of this subpart, the term ‘adjustable ben-
efit’ means— 
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‘‘(A) benefits, rights, and features under 
the plan, including post-retirement death bene-
fits, 60-month guarantees, disability benefits 
not yet in pay status, and similar benefits, 
‘‘(B) any early retirement benefit or retire-
ment-type subsidy (within the meaning of sec-
tion 411(d)(6)(B)(i)) and any benefit payment 
option (other than the qualified joint and sur-
vivor annuity), and 
‘‘(C) benefit increases that were adopted 
(or, if later, took effect) less than 60 months 
before the first day such realignment program 
took effect. 
‘‘(4) CORE BENEFIT DEFINED.—For purposes 
of this subpart, the term ‘core benefit’ means a par-
ticipant’s accrued benefit payable in the normal form 
of an annuity commencing at normal retirement age, 
determined without regard to— 
‘‘(A) any early retirement benefits, retire-
ment-type subsidies, or other benefits, rights, or 
features that may be associated with that ben-
efit, and 
‘‘(B) any cost-of-living adjustments or ben-
efit increases effective after the date of retire-
ment. 
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‘‘(5) COORDINATION WITH CONTRIBUTION IN-
CREASES.— 
‘‘(A) IN
GENERAL.—A realignment pro-
gram may provide that some or all of the ben-
efit modifications described in the program will 
only take effect if the bargaining parties fail to 
agree to specified levels of increases in contribu-
tions to the plan, effective as of specified dates. 
‘‘(B) INDEPENDENT
BENEFIT
MODIFICA-
TIONS.—If a realignment program adopts any 
changes to the benefit formula that are inde-
pendent of potential contribution increases, 
such changes shall take effect not later than 
180 days following the first day of the first 
plan year that begins following the adoption of 
the realignment program. 
‘‘(C) CONDITIONAL
BENEFIT
MODIFICA-
TIONS.—If a realignment program adopts any 
changes to the benefit formula that take effect 
only if the bargaining parties fail to agree to 
contribution increases, such changes shall take 
effect not later than the first day of the first 
plan year beginning after the third anniversary 
of the date of adoption of the realignment pro-
gram. 
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‘‘(D) REVOCATION OF CERTAIN BENEFIT 
MODIFICATIONS.—Benefit 
modifications 
de-
scribed in paragraph (3) may be revoked, in 
whole or in part, and retroactively or prospec-
tively, when contributions to the plan are in-
creased, as specified in the realignment pro-
gram, including any amendments thereto. The 
preceding sentence shall not apply unless the 
contribution increases are to be effective not 
later than the fifth anniversary of the first day 
of the first plan year that begins after the 
adoption of the realignment program. 
‘‘(b) NOTICE.— 
‘‘(1) IN GENERAL.—In any case in which it is 
certified under section 438(a) that the projected 
funded ratio is less than 120 percent, the plan spon-
sor shall, not later than 30 days after the date of 
the certification, provide notification of the current 
and projected funded ratios to the participants and 
beneficiaries, the bargaining parties, and the Sec-
retary. Such notice shall include— 
‘‘(A) an explanation that contribution rate 
increases or benefit reductions may be nec-
essary, 
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‘‘(B) a description of the types of benefits 
that might be reduced, and 
‘‘(C) an estimate of the contribution in-
creases and benefit reductions that may be nec-
essary to achieve a projected funded ratio of 
120 percent. 
‘‘(2) NOTICE OF BENEFIT MODIFICATIONS.— 
‘‘(A) IN GENERAL.—No modifications may 
be made that reduce the rate of future benefit 
accrual or that reduce core benefits or adjust-
able benefits unless notice of such reduction has 
been given at least 180 days before the general 
effective date of such reduction for all partici-
pants and beneficiaries to— 
‘‘(i) plan participants and bene-
ficiaries, 
‘‘(ii) each employer who has an obliga-
tion to contribute to the composite plan, 
and 
‘‘(iii) 
each 
employee 
organization 
which, for purposes of collective bar-
gaining, represents plan participants em-
ployed by such employers. 
‘‘(B) CONTENT
OF
NOTICE.—The notice 
under subparagraph (A) shall contain— 
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‘‘(i) sufficient information to enable 
participants and beneficiaries to under-
stand the effect of any reduction on their 
benefits, including an illustration of any 
affected benefit or subsidy, on an annual 
or monthly basis that a participant or ben-
eficiary would otherwise have been eligible 
for as of the general effective date de-
scribed in subparagraph (A), and 
‘‘(ii) information as to the rights and 
remedies of plan participants and bene-
ficiaries as well as how to contact the De-
partment of Labor for further information 
and assistance, where appropriate. 
‘‘(C) FORM
AND
MANNER.—Any notice 
under subparagraph (A)— 
‘‘(i) shall be provided in a form and 
manner prescribed in regulations of the 
Secretary of Labor, 
‘‘(ii) shall be written in a manner so 
as to be understood by the average plan 
participant. 
‘‘(3) MODEL NOTICES.—The Secretary shall— 
‘‘(A) prescribe model notices that the plan 
sponsor of a composite plan may use to satisfy 
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the notice requirements under this subsection, 
and 
‘‘(B) by regulation enumerate any details 
related to the elements listed in paragraph (1) 
that any notice under this subsection must in-
clude. 
‘‘(4) DELIVERY
METHOD.—Any notice under 
this part shall be provided in writing and may also 
be provided in electronic form to the extent that the 
form is reasonably accessible to persons to whom the 
notice is provided. 
‘‘SEC. 440. LIMITATION ON INCREASING BENEFITS. 
‘‘(a) LEVEL OF CURRENT FUNDED RATIOS.—Except 
as provided in subsections (c), (d), and (e), no plan 
amendment increasing benefits or establishing new bene-
fits under a composite plan may be adopted for a plan 
year unless— 
‘‘(1) the plan’s current funded ratio is at least 
110 percent (without regard to the benefit increase 
or new benefits), 
‘‘(2) taking the benefit increase or new benefits 
into account, the current funded ratio is at least 100 
percent and the projected funded ratio for the cur-
rent plan year is at least 120 percent, 
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‘‘(3) in any case in which, after taking the ben-
efit increase or new benefits into account, the cur-
rent funded ratio is less than 140 percent or the 
projected funded ratio is less than 140 percent, the 
benefit increase or new benefits are projected by the 
plan actuary to increase the present value of the 
plan’s liabilities for the plan year by not more than 
3 percent, and 
‘‘(4) expected contributions for the current plan 
year are at least 120 percent of normal cost for the 
plan year, determined using the unit credit funding 
method and treating the benefit increase or new ben-
efits as in effect for the entire plan year. 
‘‘(b) ADDITIONAL REQUIREMENTS WHERE CORE 
BENEFITS REDUCED.—If a plan has been amended to re-
duce core benefits pursuant to a realignment program 
under section 439(a)(2)(D), such plan may not be subse-
quently amended to increase core benefits unless the 
amendment— 
‘‘(1) increases the level of future benefit pay-
ments only, and 
‘‘(2) provides for an equitable distribution of 
benefit increases across the participant and bene-
ficiary population, taking into account the extent to 
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which the benefits of participants were previously re-
duced pursuant to such realignment program. 
‘‘(c) EXCEPTION TO COMPLY WITH APPLICABLE 
LAW.—Subsection (a) shall not apply in connection with 
a plan amendment if the amendment is required as a con-
dition of qualification under part I of subchapter D of 
chapter 1 or to comply with other applicable law. 
‘‘(d) EXCEPTION WHERE MAXIMUM DEDUCTIBLE 
LIMIT APPLIES.—Subsection (a) shall not apply in con-
nection with a plan amendment if and to the extent that 
contributions to the composite plan would not be deduct-
ible for the plan year under section 404(a)(1)(E) if the 
plan amendment is not adopted. The Secretary of the 
Treasury shall issue regulations to implement this para-
graph. 
‘‘(e) EXCEPTION FOR CERTAIN BENEFIT MODIFICA-
TIONS.—Subsection (a) shall not apply in connection with 
a plan amendment under section 439(a)(5)(C), regarding 
conditional benefit modifications. 
‘‘(f) TREATMENT OF PLAN AMENDMENTS.—For pur-
poses of this section— 
‘‘(1) if two or more plan amendments increas-
ing benefits or establishing new benefits are adopted 
in a plan year, such amendments shall be treated as 
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a single amendment adopted on the last day of the 
plan year, 
‘‘(2) all benefit increases and new benefits 
adopted in a single amendment are treated as a sin-
gle benefit increase, irrespective of whether the in-
creases and new benefits take effect in more than 
one plan year, and 
‘‘(3) increases in contributions or decreases in 
plan liabilities which are scheduled to take effect in 
future plan years may be taken into account in con-
nection with a plan amendment if they have been 
agreed to in writing or otherwise formalized by the 
date the plan amendment is adopted. 
‘‘SEC. 440A. COMPOSITE PLAN RESTRICTIONS TO PRE-
SERVE LEGACY PLAN FUNDING. 
‘‘(a) TREATMENT AS A LEGACY PLAN.— 
‘‘(1) IN GENERAL.—For purposes of this sub-
chapter, a defined benefit plan shall be treated as a 
legacy plan with respect to the composite plan under 
which the employees who were eligible to accrue a 
benefit under the defined benefit plan become eligi-
ble to accrue a benefit under such composite plan. 
‘‘(2) COMPONENT
PLANS.—In any case in 
which a defined benefit plan is amended to add a 
composite plan component pursuant to section 
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437(b), paragraph (1) shall be applied by sub-
stituting ‘defined benefit component’ for ‘defined 
benefit plan’ and ‘composite plan component’ for 
‘composite plan’. 
‘‘(3) ELIGIBLE TO ACCRUE A BENEFIT.—For 
purposes of paragraph (1), an employee is consid-
ered eligible to accrue a benefit under a composite 
plan as of the first day in which the employee com-
pletes an hour of service under a collective bar-
gaining agreement that provides for contributions to 
and accruals under the composite plan in lieu of ac-
cruals under the legacy plan. 
‘‘(4) COLLECTIVE BARGAINING AGREEMENT.— 
As used in this subpart, the term ‘collective bar-
gaining agreement’ includes any agreement under 
which an employer has an obligation to contribute to 
a plan. 
‘‘(5) OTHER TERMS.—Any term used in this 
subpart which is not defined in this part and which 
is also used in section 432 shall have the same 
meaning provided such term in such section. 
‘‘(b) RESTRICTIONS ON ACCEPTANCE BY COMPOSITE 
PLAN OF AGREEMENTS AND CONTRIBUTIONS.— 
‘‘(1) IN GENERAL.—The plan sponsor of a com-
posite plan shall not accept or recognize a collective 
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bargaining agreement (or any modification to such 
agreement), and no contributions may be accepted 
and no benefits may be accrued or otherwise earned 
under the agreement— 
‘‘(A) in any case in which the plan actuary 
of any defined benefit plan that would be treat-
ed as a legacy plan with respect to such com-
posite 
plan 
has 
certified 
under 
section 
432(b)(3) that such defined benefit plan is or 
will be in critical status for the plan year in 
which such agreement would take effect or for 
any of the succeeding 5 plan years, and 
‘‘(B) unless the agreement requires each 
employer who is a party to such agreement, in-
cluding employers whose employees are not par-
ticipants in the legacy plan, to provide contribu-
tions to the legacy plan with respect to such 
composite plan in a manner that satisfies the 
transition contribution requirements of sub-
section (d). 
‘‘(2) NOTICE.—Not later than 30 days after a 
determination by a plan sponsor of a composite plan 
that an agreement fails to satisfy the requirements 
described in paragraph (1), the plan sponsor shall 
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provide notification of such failure and the reasons 
for such determination to— 
‘‘(A) the parties to the agreement, 
‘‘(B) active participants of the composite 
plan who have ceased to accrue or otherwise 
earn benefits with respect to service with an 
employer pursuant to paragraph (1), and 
‘‘(C) the Secretary of Labor, the Secretary 
of the Treasury, and the Pension Benefit Guar-
anty Corporation. 
‘‘(3) LIMITATION ON RETROACTIVE EFFECT.— 
This subsection shall not apply to benefits accrued 
before the date on which notice is provided under 
paragraph (2). 
‘‘(c) RESTRICTION
ON
ACCRUAL
OF
BENEFITS 
UNDER A COMPOSITE PLAN.— 
‘‘(1) IN GENERAL.—In any case in which an 
employer, under a collective bargaining agreement 
entered into after the date of enactment of the Giv-
ing Retirement Options to Workers Act of 2020, 
ceases to have an obligation to contribute to a multi-
employer defined benefit plan, no employees em-
ployed by the employer may accrue or otherwise earn 
benefits under any composite plan, with respect to 
service with that employer, for a 60-month period 
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beginning on the date on which the employer entered 
into such collective bargaining agreement. 
‘‘(2) NOTICE OF CESSATION OF OBLIGATION.— 
Within 30 days of determining that an employer has 
ceased to have an obligation to contribute to a leg-
acy plan with respect to employees employed by an 
employer that is or will be contributing to a com-
posite plan with respect to service of such employees, 
the plan sponsor of the legacy plan shall notify the 
plan sponsor of the composite plan of that cessation. 
‘‘(3) NOTICE OF CESSATION OF ACCRUALS.— 
Not later than 30 days after determining that an 
employer has ceased to have an obligation to con-
tribute to a legacy plan, the plan sponsor of the 
composite plan shall notify the bargaining parties, 
the active participants affected by the cessation of 
accruals, the Secretary, the Secretary of Labor, and 
the Pension Benefit Guaranty Corporation of the 
cessation of accruals, the period during which such 
cessation is in effect, and the reasons therefor. 
‘‘(4) LIMITATION ON RETROACTIVE EFFECT.— 
This subsection shall not apply to benefits accrued 
before the date on which notice is provided under 
paragraph (3). 
‘‘(d) TRANSITION CONTRIBUTION REQUIREMENTS.— 
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‘‘(1) IN
GENERAL.—A collective bargaining 
agreement satisfies the transition contribution re-
quirements of this subsection if the agreement— 
‘‘(A) authorizes for payment of contribu-
tions to a legacy plan at a rate or rates equal 
to or greater than the transition contribution 
rate established under paragraph (2), and 
‘‘(B) does not provide for— 
‘‘(i) a suspension of contributions to 
the legacy plan with respect to any period 
of service, or 
‘‘(ii) any new direct or indirect exclu-
sion of younger or newly hired employees 
of the employer from being taken into ac-
count in determining contributions owed to 
the legacy plan. 
‘‘(2) TRANSITION CONTRIBUTION RATE.— 
‘‘(A) IN
GENERAL.—The transition con-
tribution rate for a plan year is the contribution 
rate that, as certified by the actuary of the leg-
acy plan in accordance with the principles in 
section 432(b)(3)(B), is reasonably expected to 
be adequate— 
‘‘(i) to fund the normal cost for the 
plan year, 
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‘‘(ii) to amortize the plan’s unfunded 
liabilities in level annual installments over 
25 years, beginning with the plan year in 
which the transition contribution rate is 
first established, and 
‘‘(iii) to amortize any subsequent 
changes in the legacy plan’s unfunded li-
ability due to experience gains or losses 
(including investment gains or losses, gains 
or losses due to contributions greater or 
less than the contributions made under the 
prior transition contribution rate, and 
other actuarial gains or losses), changes in 
actuarial assumptions, changes to the leg-
acy plan’s benefits, or changes in funding 
method over a period of 15 plan years be-
ginning with the plan year in which such 
change in unfunded liability is incurred. 
The transition contribution rate for any plan 
year may not be less than the transition con-
tribution rate for the plan year in which such 
rate is first established. 
‘‘(B) MULTIPLE RATES.—If different rates 
of contribution are payable to the legacy plan 
by different employers or for different classes of 
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employees, the certification shall specify a tran-
sition contribution rate for each such employer. 
‘‘(C) RATE APPLICABLE TO EMPLOYER.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided by clause (ii), the transition con-
tribution rate applicable to an employer for 
a plan year is the rate in effect for the 
plan year of the legacy plan that com-
mences on or after 180 days before the 
earlier of— 
‘‘(I) the effective date of the col-
lective bargaining agreement pursuant 
to which the employer contributes to 
the legacy plan, or 
‘‘(II) 5 years after the last plan 
year for which the transition contribu-
tion rate applicable to the employer 
was established or updated. 
‘‘(ii) 
EXCEPTION.—The 
transition 
contribution rate applicable to an employer 
for the first plan year beginning on or 
after the commencement of the employer’s 
obligation to contribute to the composite 
plan is the rate in effect for the plan year 
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of the legacy plan that commences on or 
after 180 days before such first plan year. 
‘‘(D) EFFECT OF LEGACY PLAN FINANCIAL 
CIRCUMSTANCES.—If the plan actuary of the 
legacy plan has certified under section 432 that 
the plan is in endangered or critical status for 
a plan year, the transition contribution rate for 
the following plan year is the rate determined 
with respect to the employer under the legacy 
plan’s funding improvement or rehabilitation 
plan under section 432, if greater than the rate 
otherwise determined, but in no event greater 
than 75 percent of the sum of the contribution 
rates applicable to the legacy plan and the com-
posite plan for the plan year. 
‘‘(E) OTHER
ACTUARIAL
ASSUMPTIONS 
AND
METHODS.—Except as provided in sub-
paragraph (A), the determination of the transi-
tion contribution rate for a plan year shall be 
based on actuarial assumptions and methods 
consistent with the minimum funding deter-
minations made under section 431 (or, if appli-
cable, section 432) with respect to the legacy 
plan for the plan year. 
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‘‘(F) ADJUSTMENTS IN RATE.—The plan 
sponsor of a legacy plan from time to time may 
adjust the transition contribution rate or rates 
applicable to an employer under this paragraph 
by increasing some rates and decreasing others 
if the actuary certifies that such adjusted rates 
in combination will produce projected contribu-
tion income for the plan year beginning on or 
after the date of certification that is not less 
than would be produced by the transition con-
tribution rates in effect at the time of the cer-
tification. 
‘‘(G) NOTICE OF TRANSITION CONTRIBU-
TION RATE.—The plan sponsor of a legacy plan 
shall provide notice to the parties to collective 
bargaining agreements pursuant to which con-
tributions are made to the legacy plan of 
changes to the transition contribution rate re-
quirements at least 30 days before the begin-
ning of the plan year for which the rate is effec-
tive. 
‘‘(H) NOTICE TO COMPOSITE PLAN SPON-
SOR.—Not later than 30 days after a deter-
mination by the plan sponsor of a legacy plan 
that a collective bargaining agreement provides 
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for a rate of contributions that is below the 
transition contribution rate applicable to one or 
more employers that are parties to the collective 
bargaining agreement, the plan sponsor of the 
legacy plan shall notify the plan sponsor of any 
composite plan under which employees of such 
employer would otherwise be eligible to accrue 
a benefit. 
‘‘(3) CORRECTION PROCEDURES.—Pursuant to 
standards prescribed by the Secretary of Labor, the 
plan sponsor of a composite plan shall adopt rules 
and procedures that give the parties to the collective 
bargaining agreement notice of the failure of such 
agreement to satisfy the transition contribution re-
quirements of this subsection, and a reasonable op-
portunity to correct such failure, not to exceed 180 
days from the date of notice given under subsection 
(b)(2). 
‘‘(4) SUPPLEMENTAL CONTRIBUTIONS.—A col-
lective bargaining agreement may provide for supple-
mental contributions to the legacy plan for a plan 
year in excess of the transition contribution rate de-
termined under paragraph (2), regardless of whether 
the legacy plan is in endangered or critical status for 
such plan year. 
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‘‘(e) NONAPPLICATION
OF COMPOSITE PLAN RE-
STRICTIONS.— 
‘‘(1) IN
GENERAL.—The provisions of sub-
sections (a), (b), and (c) shall not apply with respect 
to a collective bargaining agreement, to the extent 
the agreement, or a predecessor agreement, provides 
or provided for contributions to a defined benefit 
plan that is a legacy plan, as of the first day of the 
first plan year following a plan year for which the 
plan actuary certifies that the plan is fully funded, 
has been fully funded for at least three out of the 
immediately preceding 5 plan years, and is projected 
to remain fully funded for at least the following 4 
plan years. 
‘‘(2) DETERMINATION OF FULLY FUNDED.—A 
plan is fully funded for purposes of paragraph (1) 
if, as of the valuation date of the plan for a plan 
year, the value of the plan’s assets equals or exceeds 
the present value of the plan’s liabilities, determined 
in accordance with the rules prescribed by the Pen-
sion Benefit Guaranty Corporation under sections 
4219(c)(1)(D) and 4281 of Employee Retirement 
Income and Security Act for multiemployer plans 
terminating by mass withdrawal, as in effect for the 
date of the determination, except the plan’s reason-
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able assumption regarding the starting date of bene-
fits may be used. 
‘‘(3) OTHER
APPLICABLE
RULES.—Except as 
provided in paragraph (2), actuarial determinations 
and projections under this section shall be based on 
the rules in section 432(b)(3) and section 438(b). 
‘‘SEC. 440B. MERGERS AND ASSET TRANSFERS OF COM-
POSITE PLANS. 
‘‘(a) IN GENERAL.—Assets and liabilities of a com-
posite plan may only be merged with, or transferred to, 
another plan if— 
‘‘(1) the other plan is a composite plan, 
‘‘(2) the plan or plans resulting from the merg-
er or transfer is a composite plan, 
‘‘(3) no participant’s accrued benefit or adjust-
able benefit is lower immediately after the trans-
action than it was immediately before the trans-
action, and 
‘‘(4) the value of the assets transferred in the 
case of a transfer reasonably reflects the value of the 
amounts contributed with respect to the participants 
whose benefits are being transferred, adjusted for al-
locable distributions, investment gains and losses, 
and administrative expenses. 
‘‘(b) LEGACY PLAN.— 
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‘‘(1) IN GENERAL.—After a merger or transfer 
involving a composite plan, the legacy plan with re-
spect to an employer that is obligated to contribute 
to the resulting composite plan is the legacy plan 
that applied to that employer immediately before the 
merger or transfer. 
‘‘(2) MULTIPLE
LEGACY
PLANS.—If an em-
ployer is obligated to contribute to more than one 
legacy plan with respect to employees eligible to ac-
crue benefits under more than one composite plan 
and there is a merger or transfer of such legacy 
plans, the transition contribution rate applicable to 
the legacy plan resulting from the merger or trans-
fer with respect to that employer shall be determined 
in accordance with the provisions of section 
440A(d)(2)(B).’’. 
(2) CLERICAL AMENDMENT.—The table of sub-
parts for part III of subchapter D of chapter 1 of 
the Internal Revenue Code of 1986 is amended by 
adding at the end the following new item: 
‘‘SUBPART C. COMPOSITE PLANS AND LEGACY PLANS’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after the 
date of the enactment of this Act. 
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SEC. 140003. APPLICATION OF CERTAIN REQUIREMENTS TO 
COMPOSITE PLANS. 
(a) AMENDMENTS TO THE EMPLOYEE RETIREMENT 
INCOME SECURITY ACT OF 1974.— 
(1) TREATMENT FOR PURPOSES OF FUNDING 
NOTICES.—Section 101(f) of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 
1021(f)) is amended— 
(A) in paragraph (1) by striking ‘‘title IV 
applies’’ and inserting ‘‘title IV applies or which 
is a composite plan’’; and 
(B) by adding at the end the following: 
‘‘(5) APPLICATION TO COMPOSITE PLANS.—The 
provisions of this subsection shall apply to a com-
posite plan only to the extent prescribed by the Sec-
retary in regulations that take into account the dif-
ferences between a composite plan and a defined 
benefit plan that is a multiemployer plan.’’. 
(2) TREATMENT
FOR
PURPOSES
OF
ANNUAL 
REPORT.—Section 103 of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1023) is 
amended— 
(A) in subsection (d) by adding at the end 
the following sentence: ‘‘The provisions of this 
subsection shall apply to a composite plan only 
to the extent prescribed by the Secretary in reg-
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ulations that take into account the differences 
between a composite plan and a defined benefit 
plan that is a multiemployer plan.’’; 
(B) in subsection (f) by adding at the end 
the following: 
‘‘(3) ADDITIONAL
INFORMATION
FOR
COM-
POSITE
PLANS.—With respect to any composite 
plan— 
‘‘(A) the provisions of paragraph (1)(A) 
shall apply by substituting ‘current funded ratio 
and projected funded ratio (as such terms are 
defined in section 802(a)(2))’ for ‘funded per-
centage’ each place it appears; and 
‘‘(B) the provisions of paragraph (2) shall 
apply only to the extent prescribed by the Sec-
retary in regulations that take into account the 
differences between a composite plan and a de-
fined benefit plan that is a multiemployer 
plan.’’; and 
(C) by adding at the end the following: 
‘‘(h) COMPOSITE PLANS.—A multiemployer plan that 
incorporates the features of a composite plan as provided 
in section 801(b) shall be treated as a single plan for pur-
poses of the report required by this section, except that 
separate financial statements and actuarial statements 
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shall be provided under paragraphs (3) and (4) of sub-
section (a) for the defined benefit plan component and for 
the composite plan component of the multiemployer 
plan.’’. 
(3) TREATMENT FOR PURPOSES OF PENSION 
BENEFIT STATEMENTS.—Section 105(a) of the Em-
ployee Retirement Income Security Act of 1974 (29 
U.S.C. 1025(a)) is amended by adding at the end 
the following: 
‘‘(4) COMPOSITE PLANS.—For purposes of this 
subsection, a composite plan shall be treated as a 
defined benefit plan to the extent prescribed by the 
Secretary in regulations that take into account the 
differences between a composite plan and a defined 
benefit plan that is a multiemployer plan.’’. 
(b) AMENDMENTS
TO
THE INTERNAL REVENUE 
CODE OF 1986.—Section 6058 of the Internal Revenue 
Code of 1986 is amended by redesignating subsection (f) 
as subsection (g) and by inserting after subsection (e) the 
following: 
‘‘(f) COMPOSITE PLANS.—A multiemployer plan that 
incorporates the features of a composite plan as provided 
in section 437(b) shall be treated as a single plan for pur-
poses of the return required by this section, except that 
separate financial statements shall be provided for the de-
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fined benefit plan component and for the composite plan 
component of the multiemployer plan.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after the 
date of the enactment of this Act. 
SEC. 140004. TREATMENT OF COMPOSITE PLANS UNDER 
TITLE IV. 
(a) DEFINITION.—Section 4001(a) of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 
1301(a)) is amended by striking the period at the end of 
paragraph (21) and inserting a semicolon and by adding 
at the end the following: 
‘‘(22) COMPOSITE PLAN.—The term ‘composite 
plan’ has the meaning set forth in section 801.’’. 
(b) COMPOSITE PLANS DISREGARDED FOR CALCU-
LATING PREMIUMS.—Section 4006(a) of such Act (29 
U.S.C. 1306(a)) is amended by adding at the end the fol-
lowing: 
‘‘(9) The composite plan component of a multi-
employer plan shall be disregarded in determining 
the premiums due under this section from the multi-
employer plan.’’. 
(c) COMPOSITE
PLANS
NOT
COVERED.—Section 
4021(b)(1) of such Act (29 U.S.C. 1321(b)(1)) is amend-
ed by striking ‘‘Act’’ and inserting ‘‘Act, or a composite 
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plan, as defined in paragraph (43) of section 3 of this 
Act’’. 
(d) NO WITHDRAWAL LIABILITY.—Section 4201 of 
such Act (29 U.S.C. 1381) is amended by adding at the 
end the following: 
‘‘(c) Contributions by an employer to the composite 
plan component of a multiemployer plan shall not be taken 
into account for any purpose under this title.’’. 
(e) NO
WITHDRAWAL
LIABILITY
FOR
CERTAIN 
PLANS.—Section 4201 of such Act (29 U.S.C. 1381) is 
further amended by adding at the end the following: 
‘‘(d) Contributions by an employer to a multiem-
ployer plan described in the except clause of section 3(35) 
of this Act pursuant to a collective bargaining agreement 
that specifically designates that such contributions shall 
be allocated to the separate defined contribution accounts 
of participants under the plan shall not be taken into ac-
count with respect to the defined benefit portion of the 
plan for any purpose under this title (including the deter-
mination of the employer’s highest contribution rate under 
section 4219), even if, under the terms of the plan, partici-
pants have the option to transfer assets in their separate 
defined contribution accounts to the defined benefit por-
tion of the plan in return for service credit under the de-
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fined benefit portion, at rates established by the plan 
sponsor. 
‘‘(e) A legacy plan created under section 805 shall 
be deemed to have no unfunded vested benefits for pur-
poses of this part, for each plan year following a period 
of 5 consecutive plan years for which— 
‘‘(1) the plan was fully funded within the mean-
ing of section 805 for at least 3 of the plan years 
during that period, ending with a plan year for 
which the plan is fully funded; 
‘‘(2) the plan had no unfunded vested benefits 
for at least 3 of the plan years during that period, 
ending with a plan year for which the plan is fully 
funded; and 
‘‘(3) the plan is projected to be fully funded 
and to have no unfunded vested benefits for the fol-
lowing four plan years.’’. 
(f) NO WITHDRAWAL LIABILITY FOR EMPLOYERS 
CONTRIBUTING TO CERTAIN FULLY FUNDED LEGACY 
PLANS.—Section 4211 of such Act (29 U.S.C. 1382) is 
amended by adding at the end the following: 
‘‘(g) No amount of unfunded vested benefits shall be 
allocated to an employer that has an obligation to con-
tribute to a legacy plan described in subsection (e) of sec-
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tion 4201 for each plan year for which such subsection 
applies.’’. 
(g) NO
OBLIGATION
TO
CONTRIBUTE.—Section 
4212 of such Act (29 U.S.C. 1392) is amended by adding 
at the end the following: 
‘‘(d) NO OBLIGATION TO CONTRIBUTE.—An em-
ployer shall not be treated as having an obligation to con-
tribute to a multiemployer defined benefit plan within the 
meaning of subsection (a) solely because— 
‘‘(1) in the case of a multiemployer plan that 
includes a composite plan component, the employer 
has an obligation to contribute to the composite plan 
component of the plan; 
‘‘(2) the employer has an obligation to con-
tribute to a composite plan that is maintained pur-
suant to one or more collective bargaining agree-
ments under which the multiemployer defined ben-
efit plan is or previously was maintained; or 
‘‘(3) the employer contributes or has contrib-
uted under section 805(d) to a legacy plan associ-
ated with a composite plan pursuant to a collective 
bargaining agreement but employees of that em-
ployer were not eligible to accrue benefits under the 
legacy plan with respect to service with that em-
ployer.’’. 
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(h) NO INFERENCE.—Nothing in the amendment 
made by subsection (e) shall be construed to create an in-
ference with respect to the treatment under title IV of the 
Employee Retirement Income Security Act of 1974, as in 
effect before such amendment, of contributions by an em-
ployer to a multiemployer plan described in the except 
clause of section 3(35) of such Act that are made before 
the effective date of subsection (e) specified in subsection 
(h)(2). 
(i) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in sub-
paragraph (2), the amendments made by this section 
shall apply to plan years beginning after the date of 
the enactment of this Act. 
(2) SPECIAL RULE FOR SECTION 414(k) MULTI-
EMPLOYER PLANS.—The amendment made by sub-
section (e) shall apply only to required contributions 
payable for plan years beginning after the date of 
the enactment of this Act. 
SEC. 140005. CONFORMING CHANGES. 
(a) DEFINITIONS.—Section 3 of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 1002) 
is amended— 
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(1) in paragraph (35), by inserting ‘‘or a com-
posite plan’’ after ‘‘other than an individual account 
plan’’; and 
(2) by adding at the end the following: 
‘‘(43) The term ‘composite plan’ has the mean-
ing given the term in section 801(a).’’. 
(b) SPECIAL FUNDING RULE FOR CERTAIN LEGACY 
PLANS.— 
(1) AMENDMENT TO EMPLOYEE RETIREMENT 
INCOME SECURITY ACT OF 1974.—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: 
‘‘(9) SPECIAL
FUNDING
RULE
FOR
CERTAIN 
LEGACY PLANS.—In the case of a multiemployer de-
fined benefit plan that has adopted an amendment 
under section 801(b), in accordance with which no 
further benefits shall accrue under the multiem-
ployer defined benefit plan, the plan sponsor may 
combine the outstanding balance of all charge and 
credit bases and amortize that combined base in 
level annual installments (until fully amortized) over 
a period of 25 plan years beginning with the plan 
year following the date all benefit accruals ceased.’’. 
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(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Section 431(b) of the Internal Revenue 
Code of 1986 is amended by adding at the end the 
following: 
‘‘(9) SPECIAL
FUNDING
RULE
FOR
CERTAIN 
LEGACY PLANS.—In the case of a multiemployer de-
fined benefit plan that has adopted an amendment 
under section 437(b), in accordance with which no 
further benefits shall accrue under the multiem-
ployer defined benefit plan, the plan sponsor may 
combine the outstanding balance of all charge and 
credit bases and amortize that combined base in 
level annual installments (until fully amortized) over 
a period of 25 plan years beginning with the plan 
year following the date on which all benefit accruals 
ceased.’’. 
(c) BENEFITS AFTER MERGER, CONSOLIDATION, OR 
TRANSFER OF ASSETS.— 
(1) AMENDMENT TO EMPLOYEE RETIREMENT 
INCOME SECURITY ACT OF 1974.—Section 208 of the 
Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1058) is amended— 
(A) by striking so much of the first sen-
tence as precedes ‘‘may not merge’’ and insert-
ing the following: 
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‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), a pension plan may not merge, and’’; and 
(B) by striking the second sentence and 
adding at the end the following: 
‘‘(2) SPECIAL REQUIREMENTS FOR MULTIEM-
PLOYER PLANS.—Paragraph (1) shall not apply to 
any transaction to the extent that participants either 
before or after the transaction are covered under a 
multiemployer plan to which title IV of this Act ap-
plies or a composite plan.’’. 
(2) AMENDMENTS
TO
INTERNAL
REVENUE 
CODE OF 1986.— 
(A) QUALIFICATION REQUIREMENT.—Sec-
tion 401(a)(12) of the Internal Revenue Code 
of 1986 is amended— 
(i) by striking ‘‘(12) A trust’’ and in-
serting the following: 
‘‘(12) BENEFITS AFTER MERGER, CONSOLIDA-
TION, OR TRANSFER OF ASSETS.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), a trust’’; 
(ii) by striking the second sentence; 
and 
(iii) by adding at the end the fol-
lowing: 
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‘‘(B) SPECIAL REQUIREMENTS FOR MULTI-
EMPLOYER
PLANS.—Subparagraph (A) shall 
not apply to any multiemployer plan with re-
spect to any transaction to the extent that par-
ticipants either before or after the transaction 
are covered under a multiemployer plan to 
which title IV of the Employee Retirement In-
come Security Act of 1974 applies or a com-
posite plan.’’. 
(B) ADDITIONAL QUALIFICATION REQUIRE-
MENT.—Paragraph (1) of section 414(l) of such 
Code is amended— 
(i) by striking ‘‘(1) IN GENERAL’’ and 
all that follows through ‘‘shall not con-
stitute’’ and inserting the following: 
‘‘(1) BENEFIT
PROTECTIONS: MERGER, CON-
SOLIDATION, TRANSFER.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), a trust which forms a part 
of a plan shall not constitute’’; and 
(ii) by striking the second sentence; 
and 
(iii) by adding at the end the fol-
lowing: 
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‘‘(B) SPECIAL REQUIREMENTS FOR MULTI-
EMPLOYER PLANS.—Subparagraph (A) does not 
apply to any multiemployer plan with respect to 
any transaction to the extent that participants 
either before or after the transaction are cov-
ered under a multiemployer plan to which title 
IV of the Employee Retirement Income Secu-
rity Act of 1974 applies or a composite plan.’’. 
(d) REQUIREMENTS FOR STATUS AS A QUALIFIED 
PLAN.— 
(1) REQUIREMENT THAT ACTUARIAL ASSUMP-
TIONS BE SPECIFIED.—Section 401(a)(25) of the In-
ternal Revenue Code of 1986 is amended by insert-
ing ‘‘(in the case of a composite plan, benefits objec-
tively calculated pursuant to a formula)’’ after ‘‘defi-
nitely determinable benefits’’. 
(2) MISSING
PARTICIPANTS
IN
TERMINATING 
COMPOSITE PLAN.—Section 401(a)(34) of the Inter-
nal Revenue Code of 1986 is amended by striking ‘‘, 
a trust’’ and inserting ‘‘or a composite plan, a 
trust’’. 
(e) DEDUCTION FOR CONTRIBUTIONS TO A QUALI-
FIED PLAN.—Section 404(a)(1) of the Internal Revenue 
Code of 1986 is amended by redesignating subparagraph 
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(E) as subparagraph (F) and by inserting after subpara-
graph (D) the following: 
‘‘(E) COMPOSITE PLANS.— 
‘‘(i) IN GENERAL.—In the case of a 
composite plan, subparagraph (D) shall 
not apply and the maximum amount de-
ductible for a plan year shall be the excess 
(if any) of— 
‘‘(I) 160 percent of the greater 
of— 
‘‘(aa) the current liability of 
the plan determined in accord-
ance with the principles of sec-
tion 431(c)(6)(D), or 
‘‘(bb) the present value of 
plan liabilities as determined 
under section 438, over 
‘‘(II) the fair market value of the 
plan’s assets, projected to the end of 
the plan year. 
‘‘(ii) SPECIAL
RULES
FOR
PREDE-
CESSOR
MULTIEMPLOYER
PLAN
TO
COM-
POSITE PLAN.— 
‘‘(I) IN
GENERAL.—Except as 
provided in subclause (II), if an em-
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ployer contributes to a composite plan 
with respect to its employees, con-
tributions by that employer to a mul-
tiemployer defined benefit plan with 
respect to some or all of the same 
group of employees shall be deductible 
under sections 162 and this section, 
subject to the limits in subparagraph 
(D). 
‘‘(II) 
TRANSITION
CONTRIBU-
TION.—The full amount of a contribu-
tion to satisfy the transition contribu-
tion requirement (as defined in sec-
tion 440A(d)) and allocated to the 
legacy defined benefit plan for the 
plan year shall be deductible for the 
employer’s taxable year ending with or 
within the plan year.’’. 
(f) MINIMUM VESTING STANDARDS.— 
(1) YEARS
OF
SERVICE
UNDER
COMPOSITE 
PLANS.— 
(A) EMPLOYEE RETIREMENT INCOME SE-
CURITY ACT OF 1974.—Section 203 of the Em-
ployee Retirement Income Security Act of 1974 
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(29 U.S.C. 1053) is amended by inserting after 
subsection (f) the following: 
‘‘(g) SPECIAL RULES FOR COMPUTING YEARS OF 
SERVICE UNDER COMPOSITE PLANS.— 
‘‘(1) IN GENERAL.—In determining a qualified 
employee’s years of service under a composite plan 
for purposes of this section, the employee’s years of 
service under a legacy plan shall be treated as years 
of service earned under the composite plan. For pur-
poses of such determination, a composite plan shall 
not be treated as a defined benefit plan pursuant to 
section 801(d). 
‘‘(2) QUALIFIED EMPLOYEE.—For purposes of 
this subsection, an employee is a qualified employee 
if the employee first completes an hour of service 
under the composite plan (determined without re-
gard to the provisions of this subsection) within the 
12-month period immediately preceding or the 24- 
month period immediately following the date the em-
ployee ceased to accrue benefits under the legacy 
plan. 
‘‘(3) CERTIFICATION OF YEARS OF SERVICE.— 
For purposes of paragraph (1), the plan sponsor of 
the composite plan shall rely on a written certifi-
cation by the plan sponsor of the legacy plan of the 
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years of service the qualified employee completed 
under the defined benefit plan as of the date the em-
ployee satisfies the requirements of paragraph (2), 
disregarding any years of service that had been for-
feited under the rules of the defined benefit plan be-
fore that date. 
‘‘(h) SPECIAL RULES FOR COMPUTING YEARS OF 
SERVICE UNDER LEGACY PLANS.— 
‘‘(1) IN GENERAL.—In determining a qualified 
employee’s years of service under a legacy plan for 
purposes of this section, and in addition to any serv-
ice under applicable regulations, the employee’s 
years of service under a composite plan shall be 
treated as years of service earned under the legacy 
plan. For purposes of such determination, a com-
posite plan shall not be treated as a defined benefit 
plan pursuant to section 801(d). 
‘‘(2) QUALIFIED EMPLOYEE.—For purposes of 
this subsection, an employee is a qualified employee 
if the employee first completes an hour of service 
under the composite plan (determined without re-
gard to the provisions of this subsection) within the 
12-month period immediately preceding or the 24- 
month period immediately following the date the em-
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ployee ceased to accrue benefits under the legacy 
plan. 
‘‘(3) CERTIFICATION OF YEARS OF SERVICE.— 
For purposes of paragraph (1), the plan sponsor of 
the legacy plan shall rely on a written certification 
by the plan sponsor of the composite plan of the 
years of service the qualified employee completed 
under the composite plan after the employee satisfies 
the requirements of paragraph (2), disregarding any 
years of service that has been forfeited under the 
rules of the composite plan.’’. 
(B) INTERNAL REVENUE CODE OF 1986.— 
Section 411(a) of the Internal Revenue Code of 
1986 is amended by adding at the end the fol-
lowing: 
‘‘(14) SPECIAL
RULES
FOR
DETERMINING 
YEARS OF SERVICE UNDER COMPOSITE PLANS.— 
‘‘(A) IN
GENERAL.—In determining a 
qualified employee’s years of service under a 
composite plan for purposes of this subsection, 
the employee’s years of service under a legacy 
plan shall be treated as years of service earned 
under the composite plan. For purposes of such 
determination, a composite plan shall not be 
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treated as a defined benefit plan pursuant to 
section 437(d). 
‘‘(B) QUALIFIED
EMPLOYEE.—For pur-
poses of this paragraph, an employee is a quali-
fied employee if the employee first completes an 
hour of service under the composite plan (deter-
mined without regard to the provisions of this 
paragraph) within the 12-month period imme-
diately preceding or the 24-month period imme-
diately following the date the employee ceased 
to accrue benefits under the legacy plan. 
‘‘(C) CERTIFICATION OF YEARS OF SERV-
ICE.—For purposes of subparagraph (A), the 
plan sponsor of the composite plan shall rely on 
a written certification by the plan sponsor of 
the legacy plan of the years of service the quali-
fied employee completed under the legacy plan 
as of the date the employee satisfies the re-
quirements of subparagraph (B), disregarding 
any years of service that had been forfeited 
under the rules of the defined benefit plan be-
fore that date. 
‘‘(15) SPECIAL RULES FOR COMPUTING YEARS 
OF SERVICE UNDER LEGACY PLANS.— 
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‘‘(A) IN
GENERAL.—In determining a 
qualified employee’s years of service under a 
legacy plan for purposes of this section, and in 
addition to any service under applicable regula-
tions, the employee’s years of service under a 
composite plan shall be treated as years of serv-
ice earned under the legacy plan. For purposes 
of such determination, a composite plan shall 
not be treated as a defined benefit plan pursu-
ant to section 437(d). 
‘‘(B) QUALIFIED
EMPLOYEE.—For pur-
poses of this paragraph, an employee is a quali-
fied employee if the employee first completes an 
hour of service under the composite plan (deter-
mined without regard to the provisions of this 
paragraph) within the 12-month period imme-
diately preceding or the 24-month period imme-
diately following the date the employee ceased 
to accrue benefits under the legacy plan. 
‘‘(C) CERTIFICATION OF YEARS OF SERV-
ICE.—For purposes of subparagraph (A), the 
plan sponsor of the legacy plan shall rely on a 
written certification by the plan sponsor of the 
composite plan of the years of service the quali-
fied employee completed under the composite 
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plan after the employee satisfies the require-
ments of subparagraph (B), disregarding any 
years of service that has been forfeited under 
the rules of the composite plan.’’. 
(2) REDUCTION OF BENEFITS.— 
(A) EMPLOYEE RETIREMENT INCOME SE-
CURITY ACT OF 1974.—Section 203(a)(3)(E)(ii) 
of the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1053(a)(3)(E)(ii)) is 
amended— 
(i) in subclause (I) by striking 
‘‘4244A’’ and inserting ‘‘305(e), 803,’’; 
and 
(ii) in subclause (II) by striking 
‘‘4245’’ and inserting ‘‘305(e), 4245,’’. 
(B) INTERNAL REVENUE CODE OF 1986.— 
Section 411(a)(3)(F) of the Internal Revenue 
Code of 1986 is amended— 
(i) in clause (i) by striking ‘‘section 
418D or under section 4281 of the Em-
ployee Retirement Income Security Act of 
1974’’ and inserting ‘‘section 432(e) or 
439 or under section 4281 of the Em-
ployee Retirement Income Security Act of 
1974’’; and 
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(ii) in clause (ii) by inserting ‘‘or 
432(e)’’ after ‘‘section 418E’’. 
(3) ACCRUED BENEFIT REQUIREMENTS.— 
(A) EMPLOYEE RETIREMENT INCOME SE-
CURITY ACT OF 1974.—Section 204(b)(1)(B)(i) 
of the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1054(b)(1)(B)(i)) is 
amended by inserting ‘‘, including an amend-
ment reducing or suspending benefits under 
section 305(e), 803, 4245 or 4281,’’ after ‘‘any 
amendment to the plan’’. 
(B) INTERNAL REVENUE CODE OF 1986.— 
Section 411(b)(1)(B)(i) of the Internal Revenue 
Code of 1986 is amended by inserting ‘‘, includ-
ing an amendment reducing or suspending ben-
efits under section 418E, 432(e) or 439, or 
under section 4281 of the Employee Retirement 
Income Security Act of 1974,’’ after ‘‘any 
amendment to the plan’’. 
(4) ADDITIONAL ACCRUED BENEFIT REQUIRE-
MENTS.— 
(A) EMPLOYEE RETIREMENT INCOME SE-
CURITY ACT OF 1974.—Section 204(b)(1)(H)(v) 
of the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1053(b)(1)(H)(v)) is 
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amended by inserting before the period at the 
end the following: ‘‘, or benefits are reduced or 
suspended under section 305(e), 803, 4245, or 
4281’’. 
(B) INTERNAL REVENUE CODE OF 1986.— 
Section 411(b)(1)(H)(iv) of the Internal Rev-
enue Code of 1986 is amended— 
(i) in the heading by striking ‘‘BEN-
EFIT’’ and inserting ‘‘BENEFIT AND THE 
SUSPENSION AND REDUCTION OF CERTAIN 
BENEFITS’’; and 
(ii) in the text by inserting before the 
period at the end the following: ‘‘, or bene-
fits are reduced or suspended under sec-
tion 418E, 432(e), or 439, or under sec-
tion 4281 of the Employee Retirement In-
come Security Act of 1974’’. 
(5) ACCRUED BENEFIT NOT TO BE DECREASED 
BY AMENDMENT.— 
(A) EMPLOYEE RETIREMENT INCOME SE-
CURITY ACT OF 1974.—Section 204(g)(1) of the 
Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1053(g)(1)) is amended by in-
serting after ‘‘302(d)(2)’’ the following: ‘‘, 
305(e), 803, 4245,’’. 
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(B) INTERNAL REVENUE CODE OF 1986.— 
Section 411(d)(6)(A) of the Internal Revenue 
Code of 1986 is amended by inserting after 
‘‘412(d)(2),’’ the following: ‘‘418E, 432(e), or 
439,’’. 
(g) CERTAIN FUNDING RULES NOT APPLICABLE.— 
(1) EMPLOYEE RETIREMENT INCOME SECURITY 
ACT OF 1974.—Section 305 of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 1085) 
is amended by adding at the end the following: 
‘‘(k) LEGACY PLANS.—Sections 302, 304, and 305 
shall not apply to an employer that has an obligation to 
contribute to a plan that is a legacy plan within the mean-
ing of section 805(a) solely because the employer has an 
obligation to contribute to a composite plan described in 
section 801 that is associated with that legacy plan.’’. 
(2) INTERNAL REVENUE CODE OF 1986.—Sec-
tion 432 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following: 
‘‘(k) LEGACY PLANS.—Sections 412, 431, and 432 
shall not apply to an employer that has an obligation to 
contribute to a plan that is a legacy plan within the mean-
ing of section 440A(a) solely because the employer has an 
obligation to contribute to a composite plan described in 
section 437 that is associated with that legacy plan.’’. 
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(h) TERMINATION OF COMPOSITE PLAN.—Section 
403(d) of the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1103(d) is amended— 
(1) in paragraph (1), by striking ‘‘regulations 
of the Secretary.’’ and inserting ‘‘regulations of the 
Secretary, or as provided in paragraph (3).’’; and 
(2) by adding at the end the following: 
‘‘(3) Section 4044(a) of this Act shall be ap-
plied in the case of the termination of a composite 
plan by— 
‘‘(A) limiting the benefits subject to para-
graph (3) thereof to benefits as defined in sec-
tion 802(b)(3)(B); and 
‘‘(B) including in the benefits subject to 
paragraph (4) all other benefits (if any) of indi-
viduals under the plan that would be guaran-
teed under section 4022A if the plan were sub-
ject to title IV.’’. 
(i) GOOD FAITH COMPLIANCE PRIOR
TO GUID-
ANCE.—Where the implementation of any provision of law 
added or amended by this division is subject to issuance 
of regulations by the Secretary of Labor, the Secretary 
of the Treasury, or the Pension Benefit Guaranty Cor-
poration, a multiemployer plan shall not be treated as fail-
ing to meet the requirements of any such provision prior 
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to the issuance of final regulations or other guidance to 
carry out such provision if such plan is operated in accord-
ance with a reasonable, good faith interpretation of such 
provision. 
SEC. 140006. EFFECTIVE DATE. 
Unless otherwise specified, the amendments made by 
this division shall apply to plan years beginning after the 
date of the enactment of this Act. 
DIVISION O—EDUCATION PROVI-
SIONS 
AND 
OTHER 
PRO-
GRAMS 
TITLE I—HIGHER EDUCATION 
PROVISIONS 
SEC. 150101. DEFINITIONS. 
In this title: 
(1) AWARD YEAR.—The term ‘‘award year’’ has 
the meaning given the term in section 481(a) of the 
Higher Education Act of 1965 (20 U.S.C. 1088(a)). 
(2) AUTHORIZING
COMMITTEES.—The term 
‘‘authorizing committees’’ has the meaning given the 
term in section 103 of the Higher Education Act of 
1965 (20 U.S.C. 1003). 
(3) FAFSA.—The term ‘‘FAFSA’’ means an 
application under section 483 of the Higher Edu-
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cation Act of 1965 (20 U.S.C. 1090) for Federal 
student financial aid. 
(4) INSTITUTION OF HIGHER EDUCATION.—The 
term ‘‘institution of higher education’’ has the 
meaning given the term in section 102 of the Higher 
Education Act of 1965 (20 U.S.C. 1002). 
(5) 
QUALIFYING
EMERGENCY.—The 
term 
‘‘qualifying emergency’’ has the meaning given the 
term in section 3502 of the CARES Act (Public 
Law 116–136), as amended by this Act. 
(6) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Education. 
Subtitle A—CARES Act 
Amendments 
SEC. 150102. APPLICATION OF WAIVER TO PARTICIPATING 
NONPROFIT EMPLOYERS. 
(a) IN GENERAL.—Section 3503 of the CARES Act 
(Public Law 116–136) is amended— 
(1) by redesignating subsection (b) as sub-
section (c); and 
(2) by inserting after subsection (a) the fol-
lowing: 
‘‘(b) WAIVER OF NON-FEDERAL SHARE REQUIRE-
MENT
FOR NONPROFIT EMPLOYERS.—Notwithstanding 
any other provision of law, with respect to funds made 
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available for award years 2019–2020 and 2020–2021, the 
Secretary shall waive any requirement that a nonprofit 
employer provide a non-Federal share to match Federal 
funds provided to such nonprofit employer under an agree-
ment under section 443 of the Higher Education Act of 
1965 (20 U.S.C. 1087–53).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall take effect as if included in the enact-
ment of the CARES Act (Public Law 116–136). 
SEC. 150103. EXTENSION OF FEDERAL WORK-STUDY DUR-
ING A QUALIFYING EMERGENCY. 
(a) IN GENERAL.—Section 3505 of the CARES Act 
(Public Law 116–136) is amended— 
(1) in subsection (a)— 
(A) by striking ‘‘(not to exceed one aca-
demic year)’’; and 
(B) by striking ‘‘such academic year’’ and 
inserting ‘‘such period’’; and 
(2) in subsection (b)— 
(A) in paragraph (1), by inserting ‘‘first’’ 
before ‘‘occurred’’; and 
(B) in paragraph (3), by striking ‘‘for all 
or part of such academic year’’. 
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lated to the coronavirus declared by the 
applicable government authorities in the 
country in which the foreign institution is 
located, or in the case of a qualifying 
emergency,’’; and 
(ii) by inserting ‘‘, for the duration of 
the applicable emergency or disaster and 
the 
following 
payment 
period,’’ 
after 
‘‘1087a et seq.)’’; and 
(B) in paragraph (4)— 
(i) by striking ‘‘qualifying emergency’’ 
and inserting ‘‘applicable emergency or dis-
aster’’; and 
(ii) by striking the period at the end 
and inserting ‘‘, the name of the institution 
of higher education located in the United 
States that has entered into a written ar-
rangement with such foreign institution, 
and information regarding the nature of 
such written arrangement, including which 
coursework or program requirements are 
accomplished at each respective institu-
tion.’’. 
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(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall take effect as if included in the enact-
ment of the CARES Act (Public Law 116–136). 
SEC. 150105. FUNDING FOR HBCU CAPITAL FINANCING. 
(a) IN GENERAL.—Section 3512(d) of the CARES 
Act (Public Law 116–136) is amended by striking 
‘‘$62,000,000’’ and inserting ‘‘such sums as may be nec-
essary’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect as if included in the enact-
ment of the CARES Act (Public Law 116–136). 
SEC. 150106. WAIVER AUTHORITY FOR INSTITUTIONAL AID. 
(a) IN GENERAL.—Section 3517(a)(1)(D) of the 
CARES Act (Public Law 116–136) is amended by striking 
‘‘(b), (c), and (g)’’ and inserting ‘‘(b) and (c)’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect as if included in the enact-
ment of the CARES Act (Public Law 116–136). 
SEC. 150107. SCOPE OF MODIFICATIONS TO REQUIRED AND 
ALLOWABLE USES. 
(a) AMENDMENT TO INCLUDE MINORITY SCIENCE 
AND
ENGINEERING
IMPROVEMENT
PROGRAM.—Sub-
section (a) of section 3518 of the CARES Act (Public Law 
116–136) is amended— 
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(1) by striking ‘‘part A or B of title III,’’ and 
inserting ‘‘part A, part B, or subpart 1 of part E 
of title III,’’; and 
(2) by inserting ‘‘1067 et seq.;’’ after ‘‘1060 et 
seq.;’’. 
(b) AMENDMENT TO CLARIFY SCOPE OF AUTHOR-
ITY.—Section 3518 of the CARES Act (Public Law 116– 
136) is amended by adding at the end the following new 
subsection: 
‘‘(d) SCOPE OF AUTHORITY.—Notwithstanding sub-
section (a), the Secretary may not modify the required or 
allowable uses of funds for grants awarded under a statu-
tory provision cited in subsection (a) in a manner that 
deviates from the overall purpose of the grant program, 
as provided in the general authorization, findings, or pur-
pose of the grant program under the applicable statutory 
provision cited in such subsection.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in the enact-
ment of the CARES Act (Public Law 116–136). 
Subtitle B—Financial Aid Access 
SEC. 150108. EMERGENCY FINANCIAL AID GRANTS EX-
CLUDED FROM NEED ANALYSIS. 
(a) TREATMENT
OF EMERGENCY FINANCIAL AID 
GRANTS
FOR NEED ANALYSIS.—Notwithstanding any 
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provision of the Higher Education Act of 1965 (20 U.S.C. 
1001 et seq.), emergency financial aid grants— 
(1) shall not be included as income or assets 
(including untaxed income and benefits under sec-
tion 480(b) of the Higher Education Act of 1965 
(20 U.S.C. 1807vv(b))) in the computation of ex-
pected family contribution for any program funded 
in whole or in part under the Higher Education Act 
of 1965 (20 U.S.C. 1001 et seq.); and 
(2) shall not be treated as estimated financial 
assistance for the purposes of section 471 or section 
480(j) of the Higher Education Act of 1965 (20 
U.S.C. 1087kk; 1087vv(j)). 
(b) DEFINITION.—In this section, the term ‘‘emer-
gency financial aid grant’’ means— 
(1) an emergency financial aid grant awarded 
by an institution of higher education under section 
3504 of the CARES Act (Public Law 116–136); 
(2) an emergency financial aid grant from an 
institution of higher education made with funds 
made available under section 18004 of the CARES 
Act (Public Law 116–136); and 
(3) any other emergency financial aid grant to 
a student from a Federal agency, a State, an Indian 
tribe, an institution of higher education, or a schol-
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arship-granting organization (including a tribal or-
ganization, as defined in section 4 of the Indian 
Self-Determination and Education Assistance Act 
(25 U.S.C. 5304)) for the purpose of providing fi-
nancial relief to students enrolled at institutions of 
higher education in response to a qualifying emer-
gency. 
SEC. 150109. FACILITATING ACCESS TO FINANCIAL AID FOR 
RECENTLY UNEMPLOYED STUDENTS. 
(a) TREATMENT AS DISLOCATED WORKER.— 
(1) IN
GENERAL.—Notwithstanding section 
479(d)(1) of the Higher Education Act of 1965 (20 
U.S.C. 1087ss(d)(1)), any individual who has ap-
plied for, or who is receiving, unemployment benefits 
at the time of the submission of a FAFSA for a cov-
ered award year shall be treated as a dislocated 
worker for purposes of the need analysis under part 
F of title IV such Act (20 U.S.C. 1087kk et seq.) 
applicable to such award year. 
(2) INFORMATION TO APPLICANTS AND INSTI-
TUTIONS.—The Secretary— 
(A) in consultation with institutions of 
higher education, shall carry out activities to in-
form applicants for Federal student financial 
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aid under the Higher Education Act of 1965 
(20 U.S.C. 1001 et seq.)— 
(i) of the treatment of individuals who 
have applied for, or who are receiving, un-
employment benefits as dislocated workers 
under paragraph (1); and 
(ii) of the availability of means-tested 
Federal benefits for which such applicants 
may be eligible; 
(B) shall carry out activities to inform in-
stitutions of higher education of the authority 
of such institutions, with explicit written con-
sent of an applicant for Federal student finan-
cial aid under the Higher Education Act of 
1965 (20 U.S.C. 1001 et seq.), to provide infor-
mation collected from such applicant’s FAFSA 
to an organization assisting the applicant in ap-
plying for and receiving Federal, State, local, or 
tribal assistance in accordance with section 312 
of the Department of Defense and Labor, 
Health and Human Services, and Education 
Appropriations Act, 2019 and Continuing Ap-
propriations Act, 2019 (Public Law 115–245); 
and 
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(C) in consultation with the Secretary of 
Labor, shall carry out activities to inform appli-
cants for, and recipients of, unemployment ben-
efits of the availability of Federal student finan-
cial aid under the Higher Education Act of 
1965 (20 U.S.C. 1001 et seq.) and the treat-
ment of such applicants and recipients as dis-
located workers under paragraph (1). 
(3) IMPLEMENTATION.—The Secretary shall 
implement this subsection not later than 30 days 
after the date of enactment of this Act. 
(4) APPLICABILITY.—Paragraph (1) shall apply 
with respect to a FAFSA submitted on or after the 
earlier of— 
(A) the date on which the Secretary imple-
ments this subsection under paragraph (3); or 
(B) the date that is 30 days after the date 
of enactment of this Act. 
(b) PROFESSIONAL JUDGMENT OF FINANCIAL AID 
ADMINISTRATORS.—The guidance of the Secretary titled 
‘‘Update on the use of ‘Professional Judgment’ by Finan-
cial Aid Administrators’’ (DCL ID: GEN–09–05), as in 
effect on May 8, 2009, shall apply— 
(1) to the exercise of professional judgement by 
financial aid administrators pursuant to section 
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479A of the Higher Education Act of 1965 (20 
U.S.C. 1087tt) with respect to any FAFSA for a 
covered award year; and 
(2) to the selection of institutions for program 
reviews pursuant to section 498A of the Higher 
Education Act of 1965 (20 U.S.C. 1099c–1) for a 
covered award year. 
(c) DEFINITIONS.—In this section: 
(1) COVERED AWARD YEAR.—The term ‘‘cov-
ered award year’’ means— 
(A) an award year during which there is a 
qualifying emergency; and 
(B) the first award year beginning after 
the end of such qualifying emergency. 
(2) MEANS-TESTED
FEDERAL
BENEFIT.—The 
term ‘‘means-tested Federal benefit’’ includes the 
following: 
(A) The supplemental security income pro-
gram under title XVI of the Social Security Act 
(42 U.S.C. 1381 et seq.). 
(B) The supplemental nutrition assistance 
program under the Food and Nutrition Act of 
2008 (7 U.S.C. 2011 et seq.). 
(C) The free and reduced price school 
lunch program established under the Richard 
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B. Russell National School Lunch Act (42 
U.S.C. 1751 et seq.). 
(D) The program of block grants for 
States for temporary assistance for needy fami-
lies established under part A of title IV of the 
Social Security Act (42 U.S.C. 601 et seq.). 
(E) The special supplemental nutrition 
program for women, infants, and children es-
tablished by section 17 of the Child Nutrition 
Act of 1966 (42 U.S.C. 1786). 
(F) The Medicaid program under title XIX 
of the Social Security Act (42 U.S.C. 1396 et 
seq.). 
(G) The tax credits provided under the fol-
lowing sections of the Internal Revenue Code of 
1986 (title 26, United States Code): 
(i) Section 25A (relating to American 
Opportunity and Lifetime Learning cred-
its). 
(ii) Section 32 (relating to earned in-
come). 
(iii) Section 36B (relating to refund-
able credit for coverage under a qualified 
health plan). 
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(iv) Section 6428 (relating to 2020 re-
covery rebates for individuals). 
(H) Federal housing assistance programs, 
including tenant-based assistance under section 
8(o) of the United States Housing Act of 1937 
(42 U.S.C. 1437f(o)), and public housing, as 
defined in section 3(b)(1) of such Act (42 
U.S.C. 1437a(b)(1)). 
(I) Such other Federal means-tested bene-
fits as may be identified by the Secretary. 
SEC. 150110. STUDENT ELIGIBILITY FOR HIGHER EDU-
CATION 
EMERGENCY 
RELIEF 
FUND 
AND 
OTHER HIGHER EDUCATION FUNDS. 
(a) IN GENERAL.—With respect to student eligibility 
for receipt of funds provided under section 18004 of the 
CARES Act (Public Law 116–136) and under title VI of 
division A of this Act— 
(1) the Secretary is prohibited from imposing 
any restriction on, or defining, the populations of 
students who may receive such funds other than a 
restriction based solely on the student’s enrollment 
at the institution of higher education; and 
(2) section 401(a) the Personal Responsibility 
and Work Opportunity Reconciliation Act of 1996 (8 
U.S.C. 1611(a)) shall not apply. 
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(b) EFFECTIVE DATE.—Subsection (a) shall take ef-
fect as if included in the enactment of the CARES Act 
(Public Law 116–136), and an institution of higher edu-
cation that provided funds to a student before the date 
of enactment of this Act shall not be penalized if such 
provision is consistent with such subsection and section 
18004 of the CARES Act (Public Law 116–136). 
SEC. 150111. DEFINITION OF DISTANCE EDUCATION. 
(a) IN GENERAL.—Except as otherwise provided in 
title IV of the Higher Education Act of 1965 (20 U.S.C. 
1070 et seq.), for purposes of such title, the term ‘‘dis-
tance education’’ means education that uses technology— 
(1) to deliver instruction to students enrolled at 
an institution of higher education who are separated 
from the instructor or instructors; and 
(2) to support regular and substantive inter-
action between the students and the instructor or in-
structors, either synchronously or asynchronously. 
(b) TECHNOLOGY.—For purposes of subsection (a), 
the technologies that may be used to offer distance edu-
cation include— 
(1) the internet; 
(2) one-way and two-way transmissions through 
open broadcast, closed circuit, cable, microwave, 
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broadband lines, fiber optics, satellite, or wireless 
communications devices; 
(3) audio conferencing; and 
(4) other media used in a course in conjunction 
with any of the technologies listed in paragraphs (1) 
through (3). 
(c) INSTRUCTOR.—For purposes of subsection (a), an 
instructor is an individual responsible for delivering course 
content and who meets the qualifications for instruction 
established by the institution of higher education’s accred-
iting agency. 
(d) SUBSTANTIVE INTERACTION.—For purposes of 
subsection (a), substantive interaction is engaging stu-
dents in teaching, learning, and assessment, consistent 
with the content under discussion, and also includes at 
least two of the following: 
(1) Providing direct instruction. 
(2) Assessing or providing feedback on a stu-
dent’s coursework. 
(3) Providing information or responding to 
questions about the content of a course or com-
petency. 
(4) Facilitating a group discussion regarding 
the content of a course or competency. 
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(5) Other instructional activities approved by 
the institution of higher education’s or program’s ac-
crediting agency. 
(e) REGULAR INTERACTION.—For purposes of sub-
section (a), an institution ensures regular interaction be-
tween a student and an instructor or instructors by, prior 
to the student’s completion of a course or competency— 
(1) providing the opportunity for substantive 
interactions with the student on a predictable and 
regular basis commensurate with the length of time 
and the amount of content in the course or com-
petency; and 
(2) monitoring the student’s academic engage-
ment and success and ensuring that an instructor is 
responsible for promptly and proactively engaging in 
substantive interaction with the student when need-
ed, on the basis of such monitoring, or upon request 
by the student. 
(f) EFFECTIVE DATE.—This section shall be effective 
for any semester (or the equivalent) that begins on or after 
August 15, 2020, and shall cease to be effective at the 
end of the 2020–2021 award year. 
SEC. 150112. INSTITUTIONAL STABILIZATION PROGRAM. 
(a) AUTHORITY TO PARTICIPATE.—Notwithstanding 
paragraph (1) or (2) of section 498(c) of the Higher Edu-
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cation Act of 1965 (20 U.S.C. 1099c(c)), an eligible insti-
tution described in subsection (b) may, in lieu of submit-
ting a letter of credit in accordance with section 
498(c)(3)(A) of such Act, submit an application under 
subsection (c)(1) to enter into a COVID–19 provisional 
program participation agreement in accordance with sub-
section (d) to provide the Secretary with satisfactory evi-
dence of its financial responsibility. 
(b) ELIGIBLE INSTITUTION DESCRIBED.—An eligible 
institution described in this subsection is a private non-
profit institution of higher education that— 
(1) either— 
(A) has a composite score of less than 1.0 
for the institutional fiscal year ending in 2019, 
as determined under section 668.171(b)(1) of 
title 34, Code of Federal Regulations; or 
(B) on the date of an application under 
subsection (c)(1), has (or anticipates having) a 
composite score of less than 1.0 for the institu-
tional fiscal year ending in 2020, as determined 
under section 668.171(b)(1) of title 34, Code of 
Federal Regulations; 
(2) during award year 2018–2019— 
(A) offered on-campus classes; and 
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(B) qualified for participation in a pro-
gram under title IV of the Higher Education 
Act of 1965 (20 U.S.C. 1070 et seq.); and 
(3) on the date of the application under sub-
section (c)(1), has a liquidity level of less than or 
equal to 180 days. 
(c) APPLICATION.— 
(1) IN GENERAL.—An eligible institution desir-
ing to enter into a COVID–19 provisional program 
participation agreement under subsection (d), shall, 
not later than December 31, 2020, submit to the 
Secretary an application that includes— 
(A) the estimated liquidity level of the eli-
gible institution on the date of the application 
and an assurance that such liquidity level will 
be attested to in accordance with paragraph 
(2); 
(B) an assurance that such eligible institu-
tion will submit a record-management plan in 
accordance with paragraph (3); and 
(C) an assurance that such eligible institu-
tion will submit a teach-out plan in accordance 
with paragraph (4); and 
(D) an assurance that such eligible institu-
tion will submit reports on teach-out agree-
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ments and sufficient progress made on such 
agreements in accordance with subsection 
(d)(3), as applicable. 
(2) AUDITOR ATTESTATION.—Not later than 60 
days after submitting an application under para-
graph (1), an eligible institution shall submit to the 
Secretary an auditor attestation of the liquidity level 
of such eligible institution on the date such institu-
tion submitted such application pursuant to an audit 
conducted by a qualified independent organization or 
person in accordance with standards established by 
the American Institute of Certified Public Account-
ants. 
(3) RECORD-MANAGEMENT PLAN.— 
(A) IN GENERAL.—Not later than 60 days 
after submitting an application under para-
graph (1), an eligible institution shall submit to 
the Secretary a record-management plan ap-
proved by the accrediting agency of such eligi-
ble institution that includes— 
(i) a plan for the custody, including 
by the State authorizing agency, if applica-
ble, and the disposition of— 
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(I) a teach-out plan and teach- 
out agreement records, as applicable; 
and 
(II) student records, including 
student transcripts, billing, and finan-
cial aid records; 
(ii) an estimate of the costs necessary 
to carry out such record-management plan; 
and 
(iii) a financial plan to provide fund-
ing for such costs. 
(B) ASSURANCE.—An eligible institution 
that submits a record-management plan under 
subparagraph (A) shall include an assurance to 
the Secretary that, in the case of the closure of 
such eligible institution, such eligible institu-
tion— 
(i) will release all financial holds 
placed on student records; and 
(ii) for the 3-year period beginning on 
the date of the closure of such eligible in-
stitution, will not require a student en-
rolled in such eligible institution on the 
date of such closure (and students with-
drawn from such eligible institution in the 
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120 days prior to such date) who requests 
the student records of such student to pur-
chase such records or otherwise charge 
such student a fee with respect to such 
records. 
(C) REPORT.—Not later than 60 days 
after submitting an application under para-
graph (1), an eligible institution shall submit 
the record-management plan required under 
subparagraph (A) and the assurance under sub-
paragraph (B) to the accrediting agency and, if 
applicable, the State authorizing agency, of 
such eligible institution. 
(4) TEACH-OUT PLAN.—Not later than 60 days 
after submitting an application under paragraph (1), 
an eligible institution shall submit a teach-out plan 
approved by the accrediting agency of such eligible 
institution to the Secretary and, if applicable, the 
State authorizing agency of such eligible institution. 
(5) LETTER OF CREDIT DURING PENDING AP-
PLICATION.—Notwithstanding section 498(c)(3)(A) 
of the Higher Education Act of 1965 (20 U.S.C. 
1099c(c)(3)(A)), the Secretary may not use the com-
posite score of an eligible institution (as determined 
under section 668.171(b)(1) of title 34, Code of 
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Federal Regulations) to require the eligible institu-
tion to submit a new letter of credit or increase the 
value of an existing letter of credit while the institu-
tion has an application pending under paragraph 
(1). 
(6) NOTIFICATION OF APPLICATION AND STA-
TUS.—The eligible institution shall notify the accred-
iting agency and, if applicable, the State authorizing 
agency, of such institution— 
(A) that the institution has submitted an 
application under paragraph (1) to the Sec-
retary not later than 10 days after submitting 
such application; and 
(B) of the final acceptance or denial of 
such application not later than 5 days after re-
ceiving a final decision from the Secretary. 
(7) APPLICATION
DECISION.—The Secretary 
shall accept or deny an application under paragraph 
(1) not later than 10 days after the date on which 
an eligible institution completes all of the submission 
requirements under paragraphs (2), (3), and (4). 
(d) COVID–19 PROVISIONAL PROGRAM PARTICIPA-
TION AGREEMENT.— 
(1) AUTHORITY TO ENTER AGREEMENT.—The 
Secretary may enter into a COVID–19 provisional 
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program participation agreement under this sub-
section with an eligible institution that submits an 
application under subsection (c)(1) on or before De-
cember 31, 2020, only if the Secretary has re-
ceived— 
(A) an auditor attestation under subsection 
(c)(2) that such eligible institution has a liquid-
ity level of less than or equal to 180 days on 
the date of the application of such eligible insti-
tution under subsection (c)(1); 
(B) a record-management plan with re-
spect to such eligible institution in accordance 
with subsection (c)(3); and 
(C) a teach-out plan with respect to such 
eligible institution in accordance with sub-
section (c)(4). 
(2) PARTICIPATION REQUIREMENTS.—In enter-
ing into a COVID–19 provisional program participa-
tion agreement with an eligible institution under this 
subsection, the Secretary shall require such eligible 
institution— 
(A) if such eligible institution has a liquid-
ity level of less than or equal to 90 days on the 
date of the application of such eligible institu-
tion under subsection (c)(1), to submit a teach- 
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out agreement (or teach-out agreements, as ap-
plicable) to the Secretary, to the accrediting 
agency of the institution, and, if applicable, the 
State authorizing agency of the institution, in 
accordance with paragraph (3); 
(B) to report to the Secretary in accord-
ance with paragraph (4); 
(C) to meet the administrative capacity re-
quirements under section 498(d) of the Higher 
Education Act of 1965 (20 U.S.C. 1099c(d)); 
and 
(D) to meet the cash reserves requirements 
under section 498(c)(6)(A) of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1099c(c)(6)(A)). 
(3) TEACH-OUT AGREEMENTS.— 
(A) SUFFICIENT
PROGRESS.—Not later 
than 30 days after the date on which an eligible 
institution described in paragraph (2)(A) enters 
into a COVID–19 provisional program partici-
pation agreement under this subsection, such 
eligible institution shall submit to the Secretary 
an interim teach-out agreement that provides 
for the equitable treatment of at least 75 per-
cent of enrolled students and a reasonable op-
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portunity for such students to complete their 
program of study. 
(B) ADDENDUM REPORTS.—Not later than 
15 days after the date on which an eligible in-
stitution submits an interim teach-out agree-
ment in accordance with subparagraph (A), and 
every 15 days thereafter, such eligible institu-
tion shall submit to the Secretary a report that 
includes— 
(i) the percentage of students enrolled 
in such eligible institution that are covered 
by a teach-out agreement; 
(ii) the increase in the percentage of 
students covered by such an agreement, as 
compared to the most recently submitted 
report; and 
(iii) such other information as the 
Secretary or accrediting agency of the eli-
gible institution may require, including the 
progress of such eligible institution in 
meeting any benchmarks set by such ac-
crediting agency related to the percentage 
of students that should be covered by such 
an agreement. 
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(C) TEACH-OUT AGREEMENT REQUIRED.— 
On the date agreed to by the eligible institution, 
the accrediting agency of such eligible institu-
tion, and the Secretary under a COVID–19 
provisional program participation agreement 
under this subsection, such eligible institution 
shall submit to the Secretary, to the accrediting 
agency of the institution, and, if applicable, the 
State authorizing agency of the institution, a 
teach-out agreement (or agreements, as applica-
ble) that— 
(i) provides for the equitable treat-
ment of all enrolled students and a reason-
able opportunity for such students to com-
plete their program of study; 
(ii) includes— 
(I) a list of all students enrolled 
in such eligible institution on the date 
such eligible institution submitted an 
application under subsection (c)(1) 
(and students withdrawn from such 
eligible institution in the 120 days 
prior to such date), including the 
name, contact information, program 
of study, program requirements com-
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pleted, and estimated date of program 
completion of each such student; 
(II) the amount of any unearned 
tuition, account balances, student 
fees, and refunds due to each such 
student; 
(III) a plan to notify each such 
student, in the case of the closure of 
such eligible institution, of— 
(aa) the process for obtain-
ing a closed school discharge 
under section 437(c)(1) of the 
Higher Education Act of 1965 
(20 U.S.C. 1087(c)(1)), using 
standard language developed by 
the Secretary under subsection 
(f), and the benefits and con-
sequences of such discharge; 
(bb) if applicable, informa-
tion on institutional and State 
refund policies; 
(cc) the teach-out institution 
or institutions available to enroll 
such student; 
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(dd) the tuition and fees of 
the educational program offered 
by each such teach-out institution 
and the number and types of 
credit each such teach-out insti-
tution will accept prior to the en-
rollment of such student; and 
(ee) the record-management 
plan submitted in accordance 
with subsection (c)(3). 
(D) DECREASE IN LIQUIDITY.—In the case 
of an eligible institution that enters into a 
COVID–19 provisional program participation 
agreement under this subsection and has a li-
quidity level of greater than 90 days on the 
date of the application of such eligible institu-
tion under subsection (c)(1), if the Secretary 
determines such eligible institution has declined 
such that the liquidity level of such eligible in-
stitution is consistently less than or equal to 90 
days, the Secretary may require such eligible in-
stitution to submit a teach-out agreement (or 
agreements, as applicable) to the Secretary in 
accordance with subparagraph (C). 
(4) REPORTING REQUIREMENTS.— 
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(B) ending on the last day of the first full 
award year that begins after the date described 
in subparagraph (A). 
(7) RENEWAL.— 
(A) IN
GENERAL.—A COVID–19 provi-
sional program participation agreement under 
this subsection may be renewed for 1 award 
year subsequent to the award year described in 
paragraph (6)(B), and shall expire no later 
than June 30, 2022. 
(B) AUTHORITY TO EXTEND RENEWAL PE-
RIOD.—Notwithstanding subparagraph (A), if 
the Secretary determines that an extension of 
renewal authority is in the best interest of the 
eligible institutions with a COVID–19 provi-
sional program participation agreement under 
this subsection, the Secretary may permit 
COVID–19 provisional program participation 
agreement under this subsection to be renewed, 
on an annual basis, for not more than 3 total 
consecutive award years subsequent to the 
award year described in paragraph (6)(B), pro-
vided that no agreement under this subsection 
shall expire later than June 30, 2024. 
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(C) RECALCULATION
OF
LIQUIDITY.—An 
eligible institution desiring to renew a COVID– 
19 provisional program participation agreement 
shall— 
(i) submit to the Secretary the liquid-
ity level of the institution on the last day 
of the most recent fiscal year of the eligible 
institution, to be used for purposes of such 
an agreement; and 
(ii) not later than 60 days after sub-
mitting such liquidity level under clause 
(i), have such liquidity level attested to in 
accordance with subsection (c)(2). 
(8) DISCONTINUATION
OF
AGREEMENT.—The 
participation of an eligible institution in a COVID– 
19 provisional program participation agreement 
under this subsection— 
(A) may be discontinued at any time at the 
request of the eligible institution; 
(B) shall be discontinued by the Secretary 
if such eligible institution receives a composite 
score of 1.0 or greater for the most recent insti-
tutional fiscal year, as determined under section 
668.171(b)(1) of title 34, Code of Federal Reg-
ulations; and 
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(C) shall have no affect on the eligibility of 
the institution to participate in a program par-
ticipation agreement under section 487(a) of 
the Higher Education Act of 1965 (20 U.S.C. 
1094) after the COVID–19 provisional program 
participation agreement under this subsection 
has expired or been discontinued. 
(9) 
GRANTS
TO
PARTICIPATING
INSTITU-
TIONS.—From the amounts authorized to be avail-
able, subject to appropriation, under subsection (j), 
the Secretary may award a grant to an eligible insti-
tution that enters into a COVID–19 provisional pro-
gram participation agreement under this subsection 
to carry out the requirements of such agreement and 
provide for the increased economic stability of such 
eligible institution. 
(10) REGULATORY
AUTHORITY.—Except as 
otherwise provided in this subsection, the Secretary 
shall have the same authority with respect to a 
COVID–19 provisional program participation agree-
ment under this subsection as the Secretary has 
with respect to a program participation agreement 
under subparagraphs (B), (F), and (G) of section 
487(c)(1) (20 U.S.C. 1099(c)(1)). 
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(e) PARTICIPATION IN TITLE IV PROGRAM.—An eli-
gible institution that enters into a COVID–19 provisional 
program participation agreement under subsection (d) 
may participate in programs under title IV of the Higher 
Education Act of 1965 (20 U.S.C. 1070 et seq.) only if 
such eligible institution submits to the Secretary (and the 
accrediting agency of such eligible institution, as applica-
ble) the agreements and reports applicable to such eligible 
institution under paragraphs (3) and (4) of subsection (d). 
(f) STANDARD LANGUAGE.—Not later than 30 days 
after the date of the enactment of this section, the Sec-
retary shall publish standard language relating to closed 
school 
discharges 
for 
purposes 
of 
subsection 
(d)(3)(C)(ii)(III)(aa). 
(g) REPORTS TO CONGRESS.—Not later than 90 days 
after the date of the enactment of this section and every 
90 days thereafter until the date on which every COVID– 
19 provisional program participation agreement under this 
subsection has expired or been terminated, or until June 
30, 2024, whichever is earlier, the Secretary shall submit 
to the authorizing committees a report that includes a 
summary of each COVID–19 provisional program partici-
pation agreement entered into or renewed in the preceding 
90 days by the Secretary under this section, including the 
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name, total student enrollment, and liquidity level of the 
institution. 
(h) AUTOMATIC CLOSED SCHOOL DISCHARGE.— 
(1) AUTOMATIC DISCHARGE REQUIRED.—With 
respect to a borrower described in paragraph (2), 
the Secretary shall, without any further action by 
the borrower, discharge the liability of the borrower 
with respect to each of the borrower’s loans (includ-
ing the interest and collection fees) described in 
paragraph (2)(A) in accordance with this subsection. 
(2) BORROWER
REQUIREMENTS.—A borrower 
described in this subparagraph is a borrower who— 
(A) was enrolled for a period of enrollment 
at an eligible institution that was participating 
in a COVID–19 provisional program participa-
tion agreement under subsection (d), and— 
(i) was unable to complete such period 
of enrollment due to the closure of the in-
stitution; or 
(ii) withdrew from the eligible institu-
tion— 
(I) not more than 120 days be-
fore the closure of the eligible institu-
tion; or 
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(II) if the Secretary determines 
an extension of the 120-day period de-
scribed in subclause (I) is necessary 
due to exceptional circumstances re-
lated to the closure of the institution, 
during the extended period deter-
mined by the Secretary; 
(B) has one or more loans— 
(i) made under title IV of the Higher 
Education Act of 1965 (20 U.S.C. 1070 et 
seq.) for a program of study at the eligible 
institution described in subparagraph (A); 
and 
(ii) that have not been discharged by 
the 
Secretary 
pursuant 
to 
section 
437(c)(1) or section 464(g)(1) of the High-
er Education Act of 1965 (20 U.S.C. 
1087(c)(1); 1087dd(g)(1)); and 
(C) during the 3-year period beginning on 
the date of the closure of the eligible institution 
described in subparagraph (A), has not enrolled 
in any institution of higher education that par-
ticipates in a program under title IV of the 
Higher Education Act of 1965 (20 U.S.C. 1070 
et seq.). 
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HR 6800 PCS
(2) APPLICATION OF INCREASED AMOUNT OF 
CASH-VALUE VOUCHER TO STATE AGENCIES.— 
(A) NOTIFICATION.—An increase to the 
amount of a cash-value voucher under para-
graph (1) shall apply to any State agency that 
notifies the Secretary of the intent to use such 
an increased amount, without further applica-
tion. 
(B) USE
OF
INCREASED
AMOUNT.—A 
State agency that notifies the Secretary under 
subparagraph (A) may use or not use the in-
creased amount described in such subparagraph 
during the period beginning on the date of the 
notification by the State agency under such 
subparagraph and ending September 30, 2020. 
(3) APPLICATION PERIOD.—An increase to the 
amount of a cash-value voucher under paragraph (1) 
may only apply during the period beginning on the 
date of the enactment of this section and ending on 
September 30, 2020. 
(4) SUNSET.—The authority to make an in-
crease to the amount of a cash-value voucher under 
paragraph (1) or to use such an increased amount 
under paragraph (2)(B) shall terminate on Sep-
tember 30, 2020. 
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