(2) EXCEPTION
FOR
FROZEN
PLAN.—Para-
graph (1) shall not apply in the case of a defined 
benefit plan unless the participant is eligible to re-
ceive service-based accruals under such plan. 
(c) APPLICABLE EMPLOYER.—For purposes of this 
title— 
(1) IN GENERAL.—The term ‘‘applicable em-
ployer’’ means, with respect to any year, any em-
ployer— 
(A)(i) the aggregate number of hours of 
service of employees of which for months during 
the preceding calendar year is 1,600 or more, 
and 
(ii) which does not make available to all 
employees a plan or arrangement described in 
section 219(g)(5) of the Internal Revenue Code 
of 1986, or 
(B) which elects the application of this 
title for any year. 
(2) HOURS
OF
SERVICE.—The SAVE UP 
Board of Governors, in consultation with the Sec-
retary of Labor, shall prescribe such guidance as 
may be necessary to determine the hours of service 
of employees, including with respect to employees 
who are not compensated on an hourly basis. 
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(3) GOVERNMENT ENTITIES AND CHURCHES.— 
The term ‘‘applicable employer’’ shall not include— 
(A) a government or entity described in 
section 414(d) of the Internal Revenue Code of 
1986; or 
(B) a church or a convention or association 
of churches that is exempt from tax under sec-
tion 501 of such Code. 
(4) AGGREGATION RULE.—All persons treated 
as a single employer under subsection (b), (c), (m), 
or (o) of section 414, of the Internal Revenue Code 
of 1986 shall be treated as a single employer. 
SEC. 102. SAVE UP ACCOUNT CONTRIBUTION PROGRAMS. 
(a) IN GENERAL.—Each applicable employer shall es-
tablish a SAVE UP Account contribution program. 
(b) SAVE UP ACCOUNT
CONTRIBUTION
PRO-
GRAM.— 
(1) IN GENERAL.—For purposes of this part, 
the term ‘‘SAVE UP Account contribution program’’ 
means, with respect to any applicable employer, a 
written arrangement that meets the requirements of 
paragraphs (2) through (5). 
(2) AUTOMATIC DEFERRAL.— 
(A) IN
GENERAL.—The requirements of 
this paragraph are met if the SAVE UP Ac-
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count contribution program includes a SAVE 
UP Account cash or deferred arrangement 
under which each eligible employee is treated as 
having elected to have the employer make elec-
tive contributions on the employee’s behalf in 
an amount equal to the applicable percentage of 
wages (as defined in section 3121(a) without 
regard to the contribution and benefit base lim-
itation in paragraph (1) thereof). 
(B) ELECTION OUT.—The election treated 
as having been made under subparagraph (A) 
shall cease to apply with respect to any em-
ployee if such employee makes an affirmative 
election— 
(i) to not have such contributions 
made, or 
(ii) to make elective contributions 
under the SAVE UP Account cash or de-
ferred arrangement at a level specified in 
such affirmative election. 
(C) SAVE UP
ACCOUNT
CASH
OR
DE-
FERRED ARRANGEMENT.—For purposes of this 
subsection, the term ‘‘SAVE UP Account cash 
or deferred arrangement’’ means an arrange-
ment under which the eligible employee may 
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elect to have the employer make payments as 
contributions under the arrangement to the em-
ployee’s SAVE UP Account on behalf of the 
employee, or to the employee directly in cash. 
(D) APPLICABLE PERCENTAGE.—For pur-
poses of this paragraph, the term ‘‘applicable 
percentage’’ means, with respect to any em-
ployee— 
(i) 3 percent during the period ending 
on the last day of the first calendar year 
which begins after the date on which the 
first elective contribution described in sub-
paragraph (A) is made with respect to 
such employee; 
(ii) 3.5 percent during the first cal-
endar year following the calendar year de-
scribed in clause (i); 
(iii) 4 percent during the second cal-
endar year following the calendar year de-
scribed in clause (i); 
(iv) 4.5 percent during the third cal-
endar year following the calendar year de-
scribed in clause (i); and 
(v) 5 percent during any subsequent 
calendar year. 
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(3) 
NONELECTIVE
EMPLOYER
CONTRIBU-
TIONS.—The requirements of this paragraph are 
met if, under the arrangement, the employer, with-
out regard to any election by the employee under 
paragraph (2), is required to make a contribution to 
the plan on behalf of each qualifying employee in an 
amount equal to at least 50 cents per hour worked 
by the employee. Such contribution shall not be 
counted as partial payment of an hourly wage. An 
employer shall not fail to meet the requirements of 
this paragraph solely by reason of making contribu-
tions on behalf of employees at a rate greater than 
50 cents per hour, but only if such contributions are 
made at the same rate for all qualifying employees 
of the employer. 
(4) NOTICES.—The requirements of this para-
graph shall not be treated as met with respect to 
any year unless the employer notifies each employee 
eligible to participate, within a reasonable period of 
time before the 30th day before the beginning of 
such year (and, for the first year the employee is so 
eligible, the 30th day before the first day such em-
ployee is so eligible), of— 
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(A) the elective contributions that may be 
elected or treated as elected under paragraph 
(2), and 
(B) the opportunity to elect under para-
graph (2)(B)(i) to not make elective contribu-
tions. 
(5) TREATMENT OF CONTRIBUTIONS.—All con-
tributions with respect to an employee made under 
a SAVE UP Account contribution program shall be 
nonforfeitable and shall be paid over to the SAVE 
UP Accounts Fund for crediting to the employee’s 
SAVE UP Account under section 103. 
(6) WAGE GROWTH ADJUSTMENT.— 
(A) IN GENERAL.—In the case of calendar 
years beginning after 2016, the 50 cent amount 
in paragraph (3) shall be increased by the aver-
age annual wage growth adjustment. 
(B) AVERAGE ANNUAL WAGE GROWTH AD-
JUSTMENT.—For purposes of subparagraph 
(A), the average annual wage growth adjust-
ment for any calendar year is the percentage (if 
any) by which— 
(i) the national average wage index 
(as defined in section 219(k)(1) of the So-
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cial Security Act) for the preceding cal-
endar year, exceeds 
(ii) the national average wage index 
(as so defined) for 2015. 
(C) ROUNDING.—Adjustments under this 
paragraph shall be rounded to the nearest cent. 
SEC. 103. SAVE UP ACCOUNTS FUND. 
(a) ESTABLISHMENT OF FUND.— 
(1) ESTABLISHMENT.—There is established in 
the Treasury of the United States a trust fund to 
be known as the ‘‘SAVE UP Accounts Fund’’. 
(2) AMOUNTS IN FUND.—The SAVE UP Ac-
counts Fund shall consist of amounts paid to SAVE 
UP Accounts pursuant to a SAVE UP Account con-
tribution programs, increased by the total net earn-
ings from investments of sums in the Fund attrib-
utable to such deposited amounts, and reduced by 
the total net losses from investments of such sums. 
(3) BUDGET
AUTHORITY; APPROPRIATION.— 
This title constitutes budget authority in advance of 
appropriations Acts and represents the obligation of 
the SAVE UP Board of Trustees to provide for the 
payment of amounts provided under this title. The 
amounts held in the SAVE UP Accounts Fund are 
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appropriated and shall remain available without fis-
cal year limitation. 
(b) ACCUMULATION ACCOUNT.—There is established 
in the SAVE UP Accounts Fund a separate account to 
be known as the ‘‘Accumulations Account’’ consisting of 
such amounts described in subsection (a)(2), less amounts 
credited to the Annuity Account. 
(c) ANNUITY ACCOUNT.—There is established in the 
SAVE UP Accounts Fund a separate account to be known 
as the ‘‘Annuity Account’’ to which the aggregate amounts 
credited to a participant’s SAVE UP Account under sec-
tion 105 shall be transferred at such time as the partici-
pant elects to start receiving benefit payments under sec-
tion 106. 
(d) RESERVE ACCOUNT.— 
(1) IN GENERAL.—There is established in the 
SAVE UP Accounts Fund a separate account to be 
known as the ‘‘Reserve Account’’ which shall rep-
resent the amounts described in subsection (a)(2), 
less amounts credited to SAVE UP Accounts under 
section 104(c). 
(2) USE OF RESERVE ACCOUNT.—The Board of 
Governors shall— 
(A) use Reserve Account amounts that are 
allocable to the investment of amounts in the 
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Accumulation Account to make up any shortfall 
in the crediting individuals accounts under sec-
tion 104(c), and 
(B) use Reserve Account amounts that are 
allocable to the investment of amounts in the 
Annuity Account to make up any shortfall in 
the payment of annuity benefits under section 
105. 
(e) AVAILABILITY.—The sums in the SAVE UP Ac-
counts Fund are appropriated and shall remain available 
without fiscal year limitation— 
(1) to invest under section 104; 
(2) to provide for the payment of benefits in ac-
cordance with section 105; and 
(3) to pay the administrative expenses incurred 
with respect to management of SAVE UP Accounts 
and such Funds. 
(f) LIMITATIONS
ON USE
OF AMOUNTS
IN
THE 
FUND.— 
(1) IN GENERAL.—Amounts in the SAVE UP 
Accounts Fund credited to an individual’s SAVE UP 
Account are nonforfeitable and may not be used for, 
or diverted to, purposes other than for the exclusive 
benefit of the individual or the individual’s bene-
ficiaries under this title. 
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(2) ASSIGNMENTS.—Amounts in the SAVE UP 
Accounts Fund credited to an individual’s SAVE UP 
Account may not be assigned or alienated and are 
not subject to execution, levy, attachment, garnish-
ment, or other legal process. 
SEC. 104. INVESTMENT OF SAVE UP ACCOUNT ASSETS. 
(a) IN GENERAL.—Amounts in the Accumulation Ac-
count of the SAVE UP Accounts Trust Fund shall be in-
vested by each SAVE UP Board of Trustees under rules 
and guidance established by the SAVE UP Board of Gov-
ernors. Each SAVE UP Board of Trustees shall be re-
sponsible for investing an amount (determined by the 
Board of Governors quarterly) that is proportional to the 
credited balances of SAVE UP Accounts within such 
Board’s jurisdiction. 
(b) INVESTMENT RETURNS.— 
(1) DAILY.—The SAVE UP Board of Gov-
ernors shall determine daily the net investment re-
turn of the entire SAVE UP Accounts Trust Fund. 
(2) ANNUAL AUDIT.—Not less than annually, 
the SAVE UP Board of Governors shall, through an 
independent audit of each SAVE UP Board of 
Trustee’s investments, determine the net investment 
return of the entire SAVE UP Accounts Trust 
Fund. 
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(c) CREDITING OF ACCOUNTS AND ALLOCATION OF 
POSITIVE INVESTMENT RETURNS.— 
(1) IN GENERAL.—Each SAVE UP Board of 
Trustees shall separately account for each individ-
ual’s SAVE UP Account within its jurisdiction and 
shall provide for crediting of— 
(A) amounts contributed with respect to 
the individual’s account under section 102, and 
(B) in the case of any period for which the 
SAVE UP Accounts Trust Fund is determined 
by the SAVE UP Board of Governors to have 
had an annualized positive net investment re-
turn, an amount equal to the individual’s allo-
cable share of such investment return. 
(2) ALLOCATION OF INVESTMENT RETURN.— 
For purposes of paragraph (1), an individual’s allo-
cable share of investment returns shall be an 
amount equal to the return such individual’s SAVE 
UP Account would have experienced had such return 
(annualized and expressed as a percentage) been 
equal to the lesser of— 
(A) 6 percent, or 
(B) the SAVE UP Accounts Trust Fund 
annualized investment return (expressed as a 
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percentage) determined by the SAVE UP 
Board of Governors. 
SEC. 105. BENEFITS IN THE FORM OF AN ANNUITY. 
(a) IN GENERAL.—A SAVE UP Account shall pay 
benefits in the form of an annuity in accordance with sub-
section (b). The amount of such benefits shall be based 
on the amounts credited to the individual’s SAVE UP Ac-
count and the form of distribution the individual elects. 
Notwithstanding the preceding sentence, the amount of an 
annuity may be adjusted to reflect the experience of the 
Fund as necessary to protect the financial integrity of the 
Fund, except that annuity payments for those in pay sta-
tus shall not be reduced more than 5 percent per year 
unless the Fund is faced with a significant financial hard-
ship and the SAVE UP Board of Governors has approved 
the reduction. 
(b) ANNUITY.—SAVE UP Accounts shall pay bene-
fits in accordance with one of the following: 
(1) In the case of a participant who does not 
die before the annuity starting date, the benefit pay-
able to such participant shall be provided in the 
form of a qualified joint and survivor annuity (as de-
fined in section 205(d)(1) of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 
1055(d)(1))). 
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(2) In the case of a participant who dies before 
the annuity starting date and who has a surviving 
spouse, a qualified preretirement survivor annuity 
(as defined in section 205(d)(2) of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 
1055(d)(2))) shall be provided to the surviving 
spouse of such participant. 
(3) In lieu of a qualified joint and survivor an-
nuity form of benefit or the qualified preretirement 
survivor annuity form of benefit (or both), a partici-
pant may elect to receive a distribution described in 
subsection (f)(3) if one of the following conditions 
are met: 
(A)(i) The spouse of the participant con-
sents in writing to the election. 
(ii) Such election designates a beneficiary 
(or form of benefits) which may not be changed 
without spousal consent (or the consent of the 
spouse expressly permits designations by the 
participant without any requirement of further 
consent by the spouse). 
(iii) The spouse’s consent acknowledges the 
effect of such election and is witnessed by a 
plan representative or a notary public. 
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(B) It is established to the satisfaction of 
a Fund representative that the consent required 
under clause (i) cannot be obtained because 
there is no spouse, because the spouse cannot 
be located, or because of such other cir-
cumstances as the SAVE UP Board of Gov-
ernors may by regulations prescribe. The con-
sent of a spouse (or establishment that the con-
sent of a spouse cannot be obtained) under this 
subparagraph shall be effective only with re-
spect to such spouse. 
(c) COMMENCEMENT OF BENEFIT PAYMENTS.—A 
participant may elect the time to start receiving benefit 
payments under this section, except that a participant— 
(1) may not elect to receive benefit payments 
before reaching the age of 62; and 
(2) must begin receiving benefit payments be-
fore the age of 70. 
(d) NOTICE.—Each Fund shall provide to each par-
ticipant, within a reasonable period of time before the an-
nuity starting date, a written explanation substantially 
similar to that required by section 205(c)(3) of the Em-
ployee Retirement Income Security Act of 1974 (29 
U.S.C. 1055(c)(3)). 
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(e) ASSIGNMENT OR ALIENATION OF FUND BENE-
FITS.—Benefits under a SAVE UP Account shall be sub-
ject to section 206(d) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1056(d)). 
(f) METHODS FOR PROVIDING ANNUITIZED BENEFIT 
PAYMENTS.— 
(1) IN
GENERAL.—The SAVE UP Board of 
Trustees shall establish and maintain mechanisms 
for adequately securing the payment of annuity ben-
efits under this section. The SAVE UP Board of 
Trustees shall include a written description of such 
mechanisms in the investment and lifetime income 
policy statements required to be disclosed to partici-
pants. 
(2) SPECIFIC
GOALS.—The mechanisms de-
scribed in paragraph (1) shall ensure that— 
(A) each participant receives a stream of 
income for life; 
(B) each participant and beneficiary has 
an opportunity to be protected against longevity 
risk; and 
(C) volatility in benefit levels is minimized 
for participants and beneficiaries in pay status 
and those approaching pay status. 
(3) SELF-ANNUITIZATION.— 
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(A) IN
GENERAL.—Notwithstanding any 
other provision of law, a SAVE UP Account 
may self-annuitize if the SAVE UP Accounts 
Fund meets such requirements as the SAVE 
UP Board of Governors establishes as nec-
essary to protect participants and beneficiaries. 
(B) 
DUTY
TO
ADDRESS
EMERGING 
ISSUES.—The SAVE UP Board of Governors 
shall, periodically and in accordance with estab-
lished procedures, update the funding require-
ments promulgated under this paragraph in re-
sponse to changing economic and business con-
ditions to the extent necessary to carry out the 
purposes of this Act. 
SEC. 106. SAVE UP ACCOUNTS GOVERNANCE. 
(a) SAVE UP BOARD OF GOVERNORS.— 
(1) ESTABLISHMENT.—There is established in 
the executive branch of the Government a SAVE UP 
Accounts Board of Governors. 
(2) DUTIES.—The Board of Governors shall— 
(A) administer the provisions of this title, 
except with respect to matters relating to 
SAVE UP Account contribution programs 
maintained by employers pursuant to section 
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102 and any duties charged to the SAVE UP 
Boards of Trustees; 
(B) establish policies for the investment 
and management of SAVE UP Account assets, 
and for the management and operation of 
SAVE UP Account annuities under this title, 
which shall provide for— 
(i) prudent investments suitable for 
accumulating funds for payment of retire-
ment income; 
(ii) investment targets; 
(iii) sound management practices; 
(iv) low administrative costs; 
(v) low investment costs; and 
(vi) investments in index funds; 
(C) review the performance of SAVE UP 
Account Fund investments; and 
(D) review the management and operation 
of annuities. 
(3) COMPOSITION.—The SAVE UP Board of 
Governors shall be composed of— 
(A) 5 members, each of whom must be a 
chairman of a regional SAVE UP Board of 
Trustees, and 
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(B) 6 members appointed by the President, 
of whom the President shall appoint at least 
one resident from each of the 5 jurisdictions of 
the regional SAVE UP Board of Trustees. 
(4) CHAIRMAN.—The President shall appoint 
one of such members as chairman of the SAVE UP 
Board of Governors. Such appointment shall be 
made by and with the advice and consent of the Sen-
ate. 
(5) LENGTH OF APPOINTMENTS.—Each mem-
ber appointed by the President under paragraph 
(3)(B) shall be appointed for a term of 6 years, ex-
cept that of the first such members taking office— 
(A) the chairman member shall serve a 
term of 7 years, 
(B) 1 member shall serve a term of 2 
years, 
(C) 1 member shall serve a term of 3 
years, 
(D) 1 member shall serve a term of 4 
years, 
(E) 1 member shall serve a term of 5 
years, and 
(F) 1 member shall serve a term of 6 
years. 
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No individual may serve more than 2 terms as a 
member of the Board. 
(b) REGIONAL SAVE UP BOARDS OF TRUSTEES.— 
(1) IN GENERAL.—There is established in the 
executive branch of the Government 5 regional 
SAVE UP Boards of Trustees, the jurisdiction of 
which shall be, to the extent practicable, apportioned 
by the Secretary of the Treasury geographically and 
to approximate an equal distribution of the United 
States population. 
(2) DUTIES.—The SAVE UP Board of Trust-
ees for each region shall oversee the management 
and administration of SAVE UP Accounts of the 
population within its respective jurisdiction, includ-
ing— 
(A) with respect to such population, man-
agement and investment of SAVE UP Account 
Trust Fund assets, payment of annuities, and 
compliance with reporting and disclosure re-
quirements, and 
(B) selection of the administrator, attor-
ney, internal auditor, record keeper, investment 
consulting team, and such other staff as may be 
necessary to carry out the duties of the SAVE 
UP Board of Trustees. 
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Any reference to a SAVE UP Board of Trustees in 
this title shall be construed to mean the regional 
SAVE UP Board of Trustees with respect to the 
SAVE UP Accounts within its jurisdiction, where 
such construction is necessary to carry out provi-
sions of this title. 
(3) COMPOSITION.—Each SAVE UP Board of 
Trustees shall be composed of 7 members, of 
whom— 
(A) 2 shall be appointed by the Federal 
Reserve Board, 
(B) 1 shall be appointed by the Commis-
sioner of the Securities and Exchange Commis-
sion, 
(C) 1 shall be appointed by the Speaker of 
the House of Representatives, 
(D) 1 shall be appointed by the Minority 
Leader of the House of Representatives, 
(E) 1 shall be appointed by the Majority 
Leader of the Senate, and 
(F) 1 shall be appointed by the Minority 
Leader of the Senate. 
(4) CHAIRMAN.—For each Board of Trustees, 
the President shall designate one of the trustees ap-
pointed under paragraph (3) as chairman, and, in 
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the case of the first such trustees taking office, shall 
designate the term of such trustee pursuant to para-
graph (5). 
(5) VICE CHAIRMAN.—Each Board of Trustees 
shall designate one of the trustees appointed under 
paragraph (3) as vice chairman. 
(6) LENGTH OF APPOINTMENTS.— 
(A) IN
GENERAL.—Each trustee of the 
Board appointed under paragraph (3) shall be 
appointed for a term of 5 years, except that of 
the first such trustees taking office— 
(i) the chairman trustee shall be de-
termined under subparagraph (B), 
(ii) 1 trustee shall serve a term of 5 
years, 
(iii) 1 trustee shall serve a term of 4 
years, 
(iv) 1 trustee shall serve a term of 3 
years, 
(v) the vice chairman trustee shall 
serve a term of 2 years, 
(vi) 1 trustee shall serve for a term of 
2 years, and 
(vii) 1 trustee shall serve for a term 
of 1 year. 
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Other than the chairman and vice chairman 
trustee, the terms of the first trustees taking 
office shall correspond with the individual who 
appointed the trustee under paragraph (3) and 
shall be ordered from the longest term to the 
shortest term on the basis of the order in which 
the individuals are listed in such paragraph. 
(B) CHAIRMAN TERMS.—For purposes of 
subparagraph (A)(i), of the trustees appointed 
as chairman of a Board of Trustees— 
(i) 1 chairman shall serve a term of 6 
years, 
(ii) 2 chairmen shall serve a term of 
5 years, 
(iii) 1 chairman shall serve a term of 
4 years, and 
(iv) 1 chairman shall serve a term of 
3 years. 
(C) TERM LIMITS.—No individual may be 
appointed to more than 2 terms as a trustee of 
the SAVE UP Board of Trustees. 
(c) VACANCIES.— 
(1) IN GENERAL.—A vacancy on the Boards es-
tablished under this section shall be filled in the 
manner in which the original appointment was made 
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SSpencer on DSK4SPTVN1PROD with BILLS
program, an election whether the contribution will be 
made to the trust or received by the employee in 
cash. 
‘‘(b) 
NONDISCRIMINATION
REQUIREMENTS.—A 
SAVE UP Account contribution program is not subject 
to the participation and nondiscrimination requirements 
applicable to arrangements described in section 401(k) or 
to matching contributions (as described in section 
401(m)). 
‘‘(c) ROLLOVER FROM SAVE UP ACCOUNT PROHIB-
ITED.—An eligible rollover distribution (as defined in sec-
tion 402(c)(4)) shall not include any amount distributed 
from a SAVE UP Account. 
‘‘(d) SAVE UP ACCOUNT LOANS.— 
‘‘(1) LIMITATIONS.—Section 72(p)(2)(A) shall 
only apply with respect to a SAVE UP Account to 
the extent that any loan (when added to the out-
standing balance of all other loans from such plan) 
does not exceed the lesser of— 
‘‘(A) $2,500, or 
‘‘(B) the total nonforfeitable amounts cred-
ited to the individual’s SAVE UP Account. 
‘‘(2) REPAYMENT.—A loan from a SAVE UP 
Account shall not fail to be treated as a loan de-
scribed in section 72(p)(2)(B) (relating to require-
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E:\BILLS\H5731.IH
H5731
SSpencer on DSK4SPTVN1PROD with BILLS