I
105TH CONGRESS
1ST SESSION
H. R. 3008
To amend title II of the Social Security Act to allow workers who attain
age 65 after 1981 and before 1992 to choose either lump sum payments
over four years totalling $5,000 or an improved benefit computation
formula under a new 10-year rule governing the transition to the changes
in benefit computation rules enacted in the Social Security Amendments
of 1977, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 9, 1997
Mr. NEUMANN introduced the following bill; which was referred to the Com-
mittee on Ways and Means, and in addition to the Committee on the
Budget, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned
A BILL
To amend title II of the Social Security Act to allow workers
who attain age 65 after 1981 and before 1992 to choose
either lump sum payments over four years totalling
$5,000 or an improved benefit computation formula
under a new 10-year rule governing the transition to
the changes in benefit computation rules enacted in the
Social Security Amendments of 1977, and for other pur-
poses.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Notch Fairness Act
of 1997’’.
SEC. 2. NEW GUARANTEED MINIMUM PRIMARY INSURANCE
AMOUNT WHERE ELIGIBILITY ARISES DUR-
ING TRANSITIONAL PERIOD.
(a) IN GENERAL.—Section 215(a) of the Social Secu-
rity Act is amended—
(1) in paragraph (4)(B), by inserting ‘‘(with or
without the application of paragraph (8))’’ after
‘‘would be made’’, and by striking ‘‘1984’’ in clause
(i) and inserting ‘‘1989’’; and
(2) by adding at the end the following:
‘‘(8)(A) In the case of an individual described in
paragraph (4)(B) (subject to subparagraphs (F) and (G)
of this paragraph), the amount of the individual’s primary
insurance amount as computed or recomputed under para-
graph (1) shall be deemed equal to the sum of—
‘‘(i) such amount, and
‘‘(ii) the applicable transitional increase amount
(if any).
‘‘(B) For purposes of subparagraph (A)(ii), the term
‘applicable transitional increase amount’ means, in the
case of any individual, the product derived by multiply-
ing—
‘‘(i) the excess under former law, by
‘‘(ii) the applicable percentage in relation to the
year in which the individual becomes eligible for old-
age insurance benefits, as determined by the follow-
ing table:
‘‘If the individual
becomes eligible for
The applicable
such benefits in:
percentage is:
1979 .......................................................................
55 percent
1980 .......................................................................
45 percent
1981 .......................................................................
35 percent
1982 .......................................................................
32 percent
1983 .......................................................................
25 percent
1984 .......................................................................
20 percent
1985 .......................................................................
16 percent
1986 .......................................................................
10 percent
1987 .......................................................................
3 percent
1988 .......................................................................
5 percent.
‘‘(C) For purposes of subparagraph (B), the term ‘ex-
cess under former law’ means, in the case of any individ-
ual, the excess of—
‘‘(i) the applicable former law primary insur-
ance amount, over
‘‘(ii) the amount which would be such individ-
ual’s primary insurance amount if computed or re-
computed under this section without regard to this
paragraph and paragraphs (4), (5), and (6).
‘‘(D) For purposes of subparagraph (C)(i), the term
‘applicable former law primary insurance amount’ means,
in the case of any individual, the amount which would be
such individual’s primary insurance amount if it were—
‘‘(i) computed or recomputed (pursuant to
paragraph (4)(B)(i)) under section 215(a) as in ef-
fect in December 1978, or
‘‘(ii) computed or recomputed (pursuant to
paragraph (4)(B)(ii)) as provided by subsection (d),
(as applicable) and modified as provided by subparagraph
(E).
‘‘(E) In determining the amount which would be an
individual’s primary insurance amount as provided in sub-
paragraph (D)—
‘‘(i) subsection (b)(4) shall not apply;
‘‘(ii) section 215(b) as in effect in December
1978 shall apply, except that section 215(b)(2)(C)
(as then in effect) shall be deemed to provide that
an individual’s ‘computation base years’ may include
only calendar years in the period after 1950 (or
1936 if applicable) and ending with the calendar
year in which such individual attains age 61, plus
the 3 calendar years after such period for which the
total of such individual’s wages and self-employment
income is the largest; and
‘‘(iii) subdivision (I) in the last sentence of
paragraph (4) shall be applied as though the words
‘without regard to any increases in that table’ in
such subdivision read ‘including any increases in
that table’.
‘‘(F) This paragraph shall apply in the case of any
individual only if such application results in a primary in-
surance amount for such individual that is greater than
it would be if computed or recomputed under paragraph
(4)(B) without regard to this paragraph.
‘‘(G)(i) This paragraph shall apply in the case of any
individual subject to any timely election to receive lump
sum payments under this subparagraph.
‘‘(ii) A written election to receive lump sum payments
under this subparagraph, in lieu of the application of this
paragraph to the computation of the primary insurance
amount of an individual described in paragraph (4)(B),
may be filed with the Commissioner of Social Security in
such form and manner as shall be prescribed in regula-
tions of the Commissioner. Any such election may be filed
by such individual or, in the event of such individual’s
death before any such election is filed by such individual,
by any other beneficiary entitled to benefits under section
202 on the basis of such individual’s wages and self-em-
ployment income. Any such election filed after December
31, 1998, shall be null and void and of no effect.
‘‘(iii) Upon receipt by the Commissioner of a timely
election filed by the individual described in paragraph
(4)(B) in accordance with clause (ii)—
‘‘(I) the Commissioner shall certify receipt of
such election to the Secretary of the Treasury, and
the Secretary of the Treasury, after receipt of such
certification, 
shall 
pay 
such 
individual, 
from
amounts in the Federal Old-Age and Survivors In-
surance Trust Fund, a total amount equal to
$5,000, in 4 annual lump sum installments of
$1,250, the first of which shall be made during fis-
cal year 1999 not later than July 1, 1999, and
‘‘(II) subparagraph (A) shall not apply in deter-
mining such individual’s primary insurance amount.
‘‘(iv) Upon receipt by the Commissioner as of Decem-
ber 31, 1998, of a timely election filed in accordance with
clause (ii) by at least one beneficiary entitled to benefits
on the basis of the wages and self–employment income of
a deceased individual described in paragraph (4)(B), if
such deceased individual has filed no timely election in ac-
cordance with clause (ii)—
‘‘(I) the Commissioner shall certify receipt of all
such elections received as of such date to the Sec-
retary of the Treasury, and the Secretary of the
Treasury, after receipt of such certification, shall
pay each beneficiary filing such a timely election,
from amounts in the Federal Old-Age and Survivors
Insurance Trust Fund, a total amount equal to
$5,000 (or, in the case of 2 or more such bene-
ficiaries, such amount distributed evenly among such
beneficiaries), in 4 equal annual lump sum install-
ments, the first of which shall be made during fiscal
year 1999 not later than July 1, 1999, and
‘‘(II) solely for purposes of determining the
amount of such beneficiary’s benefits, subparagraph
(A) shall be deemed not to apply in determining the
deceased individual’s primary insurance amount.’’.
(b) EFFECTIVE DATE AND RELATED RULES.—
(1) APPLICABILITY OF AMENDMENTS.—
(A) IN GENERAL.—Except as provided in
paragraph (2), the amendments made by this
Act shall be effective as though they had been
included or reflected in section 201 of the So-
cial Security Amendments of 1977.
(B) APPLICABILITY.—No monthly benefit
or primary insurance amount under title II of
the Social Security Act shall be increased by
reason of such amendments for any month be-
fore July 1999. The amendments made this
section shall apply with respect to benefits pay-
able in months in any fiscal year after fiscal
year 2002 only if the corresponding decrease in
adjusted discretionary spending limits for budg-
et authority and outlays under section 3 of this
Act for fiscal years prior to fiscal year 2003 is
extended by Federal law to such fiscal year
after fiscal year 2002.
(2) RECOMPUTATION TO REFLECT BENEFIT IN-
CREASES.—In any case in which an individual is en-
titled to monthly insurance benefits under title II of
the Social Security Act for June 1999, if such bene-
fits are based on a primary insurance amount com-
puted—
(A) under section 215 of such Act as in ef-
fect (by reason of the Social Security Amend-
ments of 1977) after December 1978, or
(B) under section 215 of such Act as in ef-
fect prior to January 1979 by reason of sub-
section (a)(4)(B) of such section (as amended
by the Social Security Amendments of 1977),
the Commissioner of Social Security (notwithstand-
ing section 215(f)(1) of the Social Security Act)
shall recompute such primary insurance amount so
as to take into account the amendments made by
this Act.