†
196
HR 2830 EAS
paragraphs (2)(B) and (3)(B), such amount shall
continue to be amortized under such section as so in
effect.
‘‘(5) COMBINING AND OFFSETTING AMOUNTS TO
BE AMORTIZED.—Under regulations prescribed by the
Secretary of the Treasury, amounts required to be
amortized under paragraph (2) or paragraph (3), as
the case may be—
‘‘(A) may be combined into one amount
under such paragraph to be amortized over a pe-
riod determined on the basis of the remaining
amortization period for all items entering into
such combined amount, and
‘‘(B) may be offset against amounts re-
quired to be amortized under the other such
paragraph, with the resulting amount to be am-
ortized over a period determined on the basis of
the remaining amortization periods for all items
entering into whichever of the two amounts being
offset is the greater.
‘‘(6) INTEREST.—The funding standard account
(and items therein) shall be charged or credited (as
determined under regulations prescribed by the Sec-
retary of the Treasury) with interest at the appro-
†
197
HR 2830 EAS
priate rate consistent with the rate or rates of interest
used under the plan to determine costs.
‘‘(7) SPECIAL
RULES
RELATING
TO
CHARGES
AND CREDITS TO FUNDING STANDARD ACCOUNT.—For
purposes of this part—
‘‘(A) 
WITHDRAWAL
LIABILITY.—Any
amount received by a multiemployer plan in
payment of all or part of an employer’s with-
drawal liability under part 1 of subtitle E of
title IV shall be considered an amount contrib-
uted by the employer to or under the plan. The
Secretary of the Treasury may prescribe by regu-
lation additional charges and credits to a multi-
employer plan’s funding standard account to the
extent necessary to prevent withdrawal liability
payments from being unduly reflected as advance
funding for plan liabilities.
‘‘(B) ADJUSTMENTS
WHEN
A
MULTIEM-
PLOYER PLAN LEAVES REORGANIZATION.—If a
multiemployer plan is not in reorganization in
the plan year but was in reorganization in the
immediately preceding plan year, any balance
in the funding standard account at the close of
such immediately preceding plan year—
†
198
HR 2830 EAS
‘‘(i) shall be eliminated by an offset-
ting credit or charge (as the case may be),
but
‘‘(ii) shall be taken into account in
subsequent plan years by being amortized
in equal annual installments (until fully
amortized) over 30 plan years.
The preceding sentence shall not apply to the ex-
tent of any accumulated funding deficiency
under section 4243(a) as of the end of the last
plan year that the plan was in reorganization.
‘‘(C) PLAN
PAYMENTS
TO
SUPPLEMENTAL
PROGRAM OR WITHDRAWAL LIABILITY PAYMENT
FUND.—Any amount paid by a plan during a
plan year to the Pension Benefit Guaranty Cor-
poration pursuant to section 4222 of this Act or
to a fund exempt under section 501(c)(22) of the
Internal Revenue Code of 1986 pursuant to sec-
tion 4223 of this Act shall reduce the amount of
contributions considered received by the plan for
the plan year.
‘‘(D) INTERIM WITHDRAWAL LIABILITY PAY-
MENTS.—Any amount paid by an employer
pending a final determination of the employer’s
withdrawal liability under part 1 of subtitle E
†
199
HR 2830 EAS
of title IV and subsequently refunded to the em-
ployer by the plan shall be charged to the fund-
ing standard account in accordance with regula-
tions prescribed by the Secretary of the Treasury.
‘‘(E) ELECTION FOR DEFERRAL OF CHARGE
FOR PORTION OF NET EXPERIENCE LOSS.—If an
election is in effect under section 302(b)(7)(F)
(as in effect on the day before the date of the en-
actment of the Pension Security and Trans-
parency Act of 2005) for any plan year, the
funding standard account shall be charged in the
plan year to which the portion of the net experi-
ence loss deferred by such election was deferred
with the amount so deferred (and paragraph
(2)(B)(ii) shall not apply to the amount so
charged).
‘‘(F) FINANCIAL ASSISTANCE.—Any amount
of any financial assistance from the Pension
Benefit Guaranty Corporation to any plan, and
any repayment of such amount, shall be taken
into account under this section and section 412
of the Internal Revenue Code of 1986 in such
manner as is determined by the Secretary of the
Treasury.
†
200
HR 2830 EAS
‘‘(G) SHORT-TERM BENEFITS.—To the ex-
tent that any plan amendment increases the un-
funded past service liability under the plan by
reason of an increase in benefits which are pay-
able under the terms of the plan for a period that
does not exceed 14 years from the effective date
of the amendment, paragraph (2)(B)(i) shall be
applied separately with respect to such increase
in unfunded past service liability by substituting
the number of years of the period during which
such benefits are payable for ‘15’.
‘‘(c) ADDITIONAL RULES.—
‘‘(1) DETERMINATIONS
TO
BE
MADE
UNDER
FUNDING METHOD.—For purposes of this part, nor-
mal costs, accrued liability, past service liabilities,
and experience gains and losses shall be determined
under the funding method used to determine costs
under the plan.
‘‘(2) VALUATION OF ASSETS.—
‘‘(A) IN
GENERAL.—For purposes of this
part, the value of the plan’s assets shall be deter-
mined on the basis of any reasonable actuarial
method of valuation which takes into account
fair market value and which is permitted under
†
201
HR 2830 EAS
regulations prescribed by the Secretary of the
Treasury.
‘‘(B) 
ELECTION
WITH
RESPECT
TO
BONDS.—The value of a bond or other evidence
of indebtedness which is not in default as to
principal or interest may, at the election of the
plan administrator, be determined on an amor-
tized basis running from initial cost at purchase
to par value at maturity or earliest call date.
Any election under this subparagraph shall be
made at such time and in such manner as the
Secretary of the Treasury shall by regulations
provide, shall apply to all such evidences of in-
debtedness, and may be revoked only with the
consent of such Secretary.
‘‘(3) ACTUARIAL ASSUMPTIONS MUST BE REA-
SONABLE.—For purposes of this section, all costs, li-
abilities, rates of interest, and other factors under the
plan shall be determined on the basis of actuarial as-
sumptions and methods—
‘‘(A) each of which is reasonable (taking
into account the experience of the plan and rea-
sonable expectations), and
†
202
HR 2830 EAS
‘‘(B) which, in combination, offer the actu-
ary’s best estimate of anticipated experience
under the plan.
‘‘(4) TREATMENT OF CERTAIN CHANGES AS EX-
PERIENCE GAIN OR LOSS.—For purposes of this sec-
tion, if—
‘‘(A) a change in benefits under the Social
Security Act or in other retirement benefits cre-
ated under Federal or State law, or
‘‘(B) a change in the definition of the term
‘wages’ under section 3121 of the Internal Rev-
enue Code of 1986, or a change in the amount
of such wages taken into account under regula-
tions prescribed for purposes of section 401(a)(5)
of such Code,
results in an increase or decrease in accrued liability
under a plan, such increase or decrease shall be treat-
ed as an experience loss or gain.
‘‘(5) FULL FUNDING.—If, as of the close of a
plan year, a plan would (without regard to this para-
graph) have an accumulated funding deficiency in ex-
cess of the full funding limitation—
‘‘(A) the funding standard account shall be
credited with the amount of such excess, and
†
203
HR 2830 EAS
‘‘(B) all amounts described in subpara-
graphs (B), (C), and (D) of subsection (b) (2)
and subparagraph (B) of subsection (b)(3) which
are required to be amortized shall be considered
fully amortized for purposes of such subpara-
graphs.
‘‘(6) FULL-FUNDING LIMITATION.—
‘‘(A) IN GENERAL.—For purposes of para-
graph (5), the term ‘full-funding limitation’
means the excess (if any) of—
‘‘(i) the accrued liability (including
normal cost) under the plan (determined
under the entry age normal funding method
if such accrued liability cannot be directly
calculated under the funding method used
for the plan), over
‘‘(ii) the lesser of—
‘‘(I) the fair market value of the
plan’s assets, or
‘‘(II) the value of such assets de-
termined under paragraph (2).
‘‘(B) MINIMUM AMOUNT.—
‘‘(i) IN GENERAL.—In no event shall
the 
full-funding 
limitation 
determined
†
204
HR 2830 EAS
under subparagraph (A) be less than the ex-
cess (if any) of—
‘‘(I) 90 percent of the current li-
ability of the plan (including the ex-
pected increase in current liability due
to benefits accruing during the plan
year), over
‘‘(II) the value of the plan’s assets
determined under paragraph (2).
‘‘(ii) ASSETS.—For purposes of clause
(i), assets shall not be reduced by any credit
balance in the funding standard account.
‘‘(C) FULL FUNDING LIMITATION.—For pur-
poses of this paragraph, unless otherwise pro-
vided by the plan, the accrued liability under a
multiemployer plan shall not include benefits
which are not nonforfeitable under the plan after
the termination of the plan (taking into consid-
eration section 411(d)(3) of the Internal Revenue
Code of 1986).
‘‘(D) CURRENT LIABILITY.—For purposes of
this paragraph—
‘‘(i) IN GENERAL.—The term ‘current
liability’ means all liabilities to employees
and their beneficiaries under the plan.
†
205
HR 2830 EAS
‘‘(ii) TREATMENT OF UNPREDICTABLE
CONTINGENT
EVENT
BENEFITS.—For pur-
poses of clause (i), any benefit contingent on
an event other than—
‘‘(I) age, service, compensation,
death, or disability, or
‘‘(II) an event which is reasonably
and reliably predictable (as determined
by the Secretary of the Treasury),
shall not be taken into account until the
event on which the benefit is contingent oc-
curs.
‘‘(iii) INTEREST
RATE
USED.—The
rate of interest used to determine current li-
ability under this paragraph shall be the
rate of interest determined under subpara-
graph (E).
‘‘(iv) MORTALITY TABLES.—
‘‘(I) COMMISSIONERS’ STANDARD
TABLE.—In the case of plan years be-
ginning before the first plan year to
which the first tables prescribed under
subclause (II) apply, the mortality
table used in determining current li-
ability under this paragraph shall be
†
206
HR 2830 EAS
the table prescribed by the Secretary of
the Treasury which is based on the
prevailing 
commissioners’ 
standard
table (described in section 807(d)(5)(A)
of the Internal Revenue Code of 1986)
used to determine reserves for group
annuity contracts issued on January
1, 1993.
‘‘(II) 
SECRETARIAL
AUTHOR-
ITY.—The Secretary of the Treasury
may by regulation prescribe for plan
years beginning after December 31,
1999, mortality tables to be used in de-
termining current liability under this
subsection. Such tables shall be based
upon the actual experience of pension
plans and projected trends in such ex-
perience. In prescribing such tables,
such Secretary shall take into account
results of available independent studies
of mortality of individuals covered by
pension plans.
‘‘(v) SEPARATE
MORTALITY
TABLES
FOR
THE
DISABLED.—Notwithstanding
clause (iv)—
†
207
HR 2830 EAS
‘‘(I) IN GENERAL.—The Secretary
of the Treasury shall establish mor-
tality tables which may be used (in
lieu of the tables under clause (iv)) to
determine current liability under this
subsection for individuals who are en-
titled to benefits under the plan on ac-
count of disability. Such Secretary
shall establish separate tables for indi-
viduals whose disabilities occur in
plan years beginning before January
1, 1995, and for individuals whose dis-
abilities occur in plan years beginning
on or after such date.
‘‘(II) SPECIAL RULE FOR DISABIL-
ITIES OCCURRING AFTER 1994.—In the
case of disabilities occurring in plan
years beginning after December 31,
1994, the tables under subclause (I)
shall apply only with respect to indi-
viduals described in such subclause
who are disabled within the meaning
of title II of the Social Security Act
and the regulations thereunder.
†
208
HR 2830 EAS
‘‘(vi) PERIODIC
REVIEW.—The Sec-
retary of the Treasury shall periodically (at
least every 5 years) review any tables in ef-
fect under this subparagraph and shall, to
the extent such Secretary determines nec-
essary, by regulation update the tables to
reflect the actual experience of pension
plans and projected trends in such experi-
ence.
‘‘(E) REQUIRED
CHANGE
OF
INTEREST
RATE.—For purposes of determining a plan’s
current 
liability 
for 
purposes 
of 
this
paragraph—
‘‘(i) IN GENERAL.—If any rate of in-
terest used under the plan under subsection
(b)(6) to determine cost is not within the
permissible range, the plan shall establish a
new rate of interest within the permissible
range.
‘‘(ii) PERMISSIBLE RANGE.—For pur-
poses of this subparagraph—
‘‘(I) IN GENERAL.—Except as pro-
vided in subclause (II), the term ‘per-
missible range’ means a rate of interest
which is not more than 5 percent
†
209
HR 2830 EAS
above, and not more than 10 percent
below, the weighted average of the rates
of interest on 30-year Treasury securi-
ties during the 4-year period ending on
the last day before the beginning of the
plan year.
‘‘(II) 
SECRETARIAL
AUTHOR-
ITY.—If the Secretary of the Treasury
finds that the lowest rate of interest
permissible under subclause (I) is un-
reasonably high, such Secretary may
prescribe a lower rate of interest, ex-
cept that such rate may not be less
than 80 percent of the average rate de-
termined under such subclause.
‘‘(iii) 
ASSUMPTIONS.—Notwith-
standing paragraph (3)(A), the interest rate
used under the plan shall be—
‘‘(I) determined without taking
into account the experience of the plan
and reasonable expectations, but
‘‘(II) consistent with the assump-
tions which reflect the purchase rates
which would be used by insurance com-
†
210
HR 2830 EAS
panies to satisfy the liabilities under
the plan.
‘‘(7) ANNUAL VALUATION.—
‘‘(A) IN
GENERAL.—For purposes of this
section, a determination of experience gains and
losses and a valuation of the plan’s liability
shall be made not less frequently than once every
year, except that such determination shall be
made more frequently to the extent required in
particular cases under regulations prescribed by
the Secretary of the Treasury.
‘‘(B) VALUATION DATE.—
‘‘(i) CURRENT YEAR.—Except as pro-
vided in clause (ii), the valuation referred
to in subparagraph (A) shall be made as of
a date within the plan year to which the
valuation refers or within one month prior
to the beginning of such year.
‘‘(ii) USE
OF
PRIOR
YEAR
VALU-
ATION.—The valuation referred to in sub-
paragraph (A) may be made as of a date
within the plan year prior to the year to
which the valuation refers if, as of such
date, the value of the assets of the plan are
not less than 100 percent of the plan’s cur-
†
211
HR 2830 EAS
rent liability (as defined in paragraph
(6)(D) without regard to clause (iv) there-
of).
‘‘(iii) 
ADJUSTMENTS.—Information
under clause (ii) shall, in accordance with
regulations, be actuarially adjusted to re-
flect significant differences in participants.
‘‘(iv) LIMITATION.—A change in fund-
ing method to use a prior year valuation,
as provided in clause (ii), may not be made
unless as of the valuation date within the
prior plan year, the value of the assets of
the plan are not less than 125 percent of the
plan’s current liability (as defined in para-
graph (6)(D) without regard to clause (iv)
thereof).
‘‘(8) TIME
WHEN
CERTAIN
CONTRIBUTIONS
DEEMED MADE.—For purposes of this section, any
contributions for a plan year made by an employer
after the last day of such plan year, but not later
than two and one-half months after such day, shall be
deemed to have been made on such last day. For pur-
poses of this subparagraph, such two and one-half
month period may be extended for not more than six
†
212
HR 2830 EAS
months under regulations prescribed by the Secretary
of the Treasury.
‘‘(d) EXTENSION
OF AMORTIZATION PERIODS
FOR
MULTIEMPLOYER PLANS.—
‘‘(1) AUTOMATIC EXTENSION UPON APPLICATION
BY CERTAIN PLANS.—
‘‘(A) IN GENERAL.—If the plan sponsor of
a multiemployer plan—
‘‘(i) submits to the Secretary of the
Treasury an application for an extension of
the period of years required to amortize any
unfunded liability described in any clause
of subsection (b)(2)(B) or described in sub-
section (b)(4), and
‘‘(ii) includes with the application a
certification by the plan’s actuary described
in subparagraph (B),
the Secretary of the Treasury shall extend the
amortization period for the period of time (not
in excess of 5 years) specified in the application.
Such extension shall be in addition to any exten-
sion under paragraph (2).
‘‘(B) CRITERIA.—A certification with re-
spect to a multiemployer plan is described in