H. R. 4275 
One Hundred Thirteenth Congress 
of the 
United States of America 
AT THE SECOND SESSION 
Begun and held at the City of Washington on Friday, 
the third day of January, two thousand and fourteen 
An Act 
To amend the Employee Retirement Income Security Act of 1974 and the Internal 
Revenue Code of 1986 to provide for cooperative and small employer charity 
pension plans. 
Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the ‘‘Cooperative 
and Small Employer Charity Pension Flexibility Act’’. 
(b) TABLE OF CONTENTS.—The table of contents of this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Congressional findings and declarations of policy. 
Sec. 3. Effective date. 
TITLE I—AMENDMENTS TO EMPLOYEE RETIREMENT INCOME SECURITY 
ACT OF 1974 AND OTHER PROVISIONS 
Sec. 101. Definition of cooperative and small employer charity pension plans. 
Sec. 102. Funding rules applicable to cooperative and small employer charity pen-
sion plans. 
Sec. 103. Elections. 
Sec. 104. Transparency. 
Sec. 105. Sponsor education and assistance. 
TITLE II—AMENDMENTS TO INTERNAL REVENUE CODE OF 1986 
Sec. 201. Definition of cooperative and small employer charity pension plans. 
Sec. 202. Funding rules applicable to cooperative and small employer charity pen-
sion plans. 
Sec. 203. Election not to be treated as a CSEC plan. 
SEC. 2. CONGRESSIONAL FINDINGS AND DECLARATIONS OF POLICY. 
Congress finds as follows: 
(1) Defined benefit pension plans are a cost-effective way 
for cooperative associations and charities to provide their 
employees with economic security in retirement. 
(2) Many cooperative associations and charitable organiza-
tions are only able to provide their employees with defined 
benefit pension plans because those organizations are able to 
pool their resources using the multiple employer plan structure. 
(3) The pension funding rules should encourage cooperative 
associations and charities to continue to provide their employees 
with pension benefits. 
SEC. 3. EFFECTIVE DATE. 
Unless otherwise specified in this Act, the provisions of this 
Act shall apply to years beginning after December 31, 2013.
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TITLE I—AMENDMENTS TO EMPLOYEE 
RETIREMENT INCOME SECURITY ACT 
OF 1974 AND OTHER PROVISIONS 
SEC. 101. DEFINITION OF COOPERATIVE AND SMALL EMPLOYER 
CHARITY PENSION PLANS. 
Section 210 of the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1060) is amended by adding at the end the 
following new subsection: 
‘‘(f) COOPERATIVE
AND SMALL EMPLOYER CHARITY PENSION 
PLANS.— 
‘‘(1) IN
GENERAL.—For purposes of this title, except as 
provided in this subsection, a CSEC plan is an employee pen-
sion benefit plan (other than a multiemployer plan) that is 
a defined benefit plan— 
‘‘(A) to which section 104 of the Pension Protection 
Act of 2006 applies, without regard to— 
‘‘(i) section 104(a)(2) of such Act; 
‘‘(ii) the amendments to such section 104 by section 
202(b) of the Preservation of Access to Care for Medi-
care Beneficiaries and Pension Relief Act of 2010; and 
‘‘(iii) paragraph (3)(B); or 
‘‘(B) that, as of June 25, 2010, was maintained by 
more than one employer and all of the employers were 
organizations described in section 501(c)(3) of the Internal 
Revenue Code of 1986. 
‘‘(2) AGGREGATION.—All employers that are treated as a 
single employer under subsection (b) or (c) of section 414 of 
the Internal Revenue Code of 1986 shall be treated as a single 
employer for purposes of determining if a plan was maintained 
by more than one employer under paragraph (1)(B).’’. 
SEC. 102. FUNDING RULES APPLICABLE TO COOPERATIVE AND SMALL 
EMPLOYER CHARITY PENSION PLANS. 
(a) IN GENERAL.—Part 3 of title I of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1081 et seq.) is amended 
by adding at the end the following new section: 
‘‘SEC. 306. MINIMUM FUNDING STANDARDS. 
‘‘(a) GENERAL RULE.—For purposes of section 302, the term 
‘accumulated funding deficiency’ for a CSEC plan means the excess 
of the total charges to the funding standard account for all plan 
years (beginning with the first plan year to which section 302 
applies) over the total credits to such account for such years or, 
if less, the excess of the total charges to the alternative minimum 
funding standard account for such plan years over the total credits 
to such account for such years. 
‘‘(b) FUNDING STANDARD ACCOUNT.— 
‘‘(1) ACCOUNT REQUIRED.—Each plan to which this section 
applies shall establish and maintain a funding standard 
account. Such account shall be credited and charged solely 
as provided in this section. 
‘‘(2) CHARGES TO ACCOUNT.—For a plan year, the funding 
standard account shall be charged with the sum of— 
‘‘(A) the normal cost of the plan for the plan year,
H. R. 4275—3 
‘‘(B) the amounts necessary to amortize in equal annual 
installments (until fully amortized)— 
‘‘(i) in the case of a plan in existence on January 
1, 1974, the unfunded past service liability under the 
plan on the first day of the first plan year to which 
section 302 applies, over a period of 40 plan years, 
‘‘(ii) in the case of a plan which comes into exist-
ence after January 1, 1974, but before the first day 
of the first plan year beginning after December 31, 
2013, the unfunded past service liability under the 
plan on the first day of the first plan year to which 
section 302 applies, over a period of 30 plan years, 
‘‘(iii) separately, with respect to each plan year, 
the net increase (if any) in unfunded past service 
liability under the plan arising from plan amendments 
adopted in such year, over a period of 15 plan years, 
‘‘(iv) separately, with respect to each plan year, 
the net experience loss (if any) under the plan, over 
a period of 5 plan years, and 
‘‘(v) separately, with respect to each plan year, 
the net loss (if any) resulting from changes in actuarial 
assumptions used under the plan, over a period of 
10 plan years, 
‘‘(C) the amount necessary to amortize each waived 
funding deficiency (within the meaning of section 302(c)(3)) 
for each prior plan year in equal annual installments (until 
fully amortized) over a period of 5 plan years, 
‘‘(D) the amount necessary to amortize in equal annual 
installments (until fully amortized) over a period of 5 plan 
years any amount credited to the funding standard account 
under paragraph (3)(D), and 
‘‘(E) the amount necessary to amortize in equal annual 
installments (until fully amortized) over a period of 20 
years the contributions which would be required to be 
made under the plan but for the provisions of section 
302(c)(7)(A)(i)(I) (as in effect on the day before the enact-
ment of the Pension Protection Act of 2006). 
‘‘(3) CREDITS TO ACCOUNT.—For a plan year, the funding 
standard account shall be credited with the sum of— 
‘‘(A) the amount considered contributed by the 
employer to or under the plan for the plan year, 
‘‘(B) the amount necessary to amortize in equal annual 
installments (until fully amortized)— 
‘‘(i) separately, with respect to each plan year, 
the net decrease (if any) in unfunded past service 
liability under the plan arising from plan amendments 
adopted in such year, over a period of 15 plan years, 
‘‘(ii) separately, with respect to each plan year, 
the net experience gain (if any) under the plan, over 
a period of 5 plan years, and 
‘‘(iii) separately, with respect to each plan year, 
the net gain (if any) resulting from changes in actuarial 
assumptions used under the plan, over a period of 
10 plan years, 
‘‘(C) the amount of the waived funding deficiency 
(within the meaning of section 302(c)(3)) for the plan year, 
and
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‘‘(D) in the case of a plan year for which the accumu-
lated funding deficiency is determined under the funding 
standard account if such plan year follows a plan year 
for which such deficiency was determined under the alter-
native minimum funding standard, the excess (if any) of 
any debit balance in the funding standard account (deter-
mined without regard to this subparagraph) over any debit 
balance in the alternative minimum funding standard 
account. 
‘‘(4) COMBINING AND OFFSETTING AMOUNTS TO BE AMOR-
TIZED.—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 period determined on 
the basis of the remaining amortization period for all items 
entering into such combined amount, and 
‘‘(B) may be offset against amounts required to be 
amortized under the other such paragraph, with the 
resulting amount to be amortized 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. 
‘‘(5) INTEREST.— 
‘‘(A) IN GENERAL.—Except as provided in subparagraph 
(B), the funding standard account (and items therein) shall 
be charged or credited (as determined under regulations 
prescribed by the Secretary of the Treasury) with interest 
at the appropriate rate consistent with the rate or rates 
of interest used under the plan to determine costs. 
‘‘(B) EXCEPTION.—The interest rate used for purposes 
of computing the amortization charge described in sub-
section (b)(2)(C) or for purposes of any arrangement under 
subsection (d) for any plan year shall be the greater of— 
‘‘(i) 150 percent of the Federal mid-term rate (as 
in effect under section 1274 of the Internal Revenue 
Code of 1986 for the 1st month of such plan year), 
or 
‘‘(ii) the rate of interest determined under subpara-
graph (A). 
‘‘(6) AMORTIZATION
SCHEDULES
IN
EFFECT.—Amortization 
schedules for amounts described in paragraphs (2) and (3) 
that are in effect as of the last day of the last plan year 
beginning before January 1, 2014, by reason of section 104 
of the Pension Protection Act of 2006 shall remain in effect 
pursuant to their terms and this section, except that such 
amounts shall not be amortized again under this section. 
‘‘(c) SPECIAL RULES.— 
‘‘(1) DETERMINATIONS
TO
BE
MADE
UNDER
FUNDING 
METHOD.—For purposes of this section, normal costs, accrued 
liability, past service liabilities, and experience gains and losses 
shall be determined under the funding method used to deter-
mine costs under the plan. 
‘‘(2) VALUATION OF ASSETS.— 
‘‘(A) IN GENERAL.—For purposes of this section, the 
value of the plan’s assets shall be determined on the basis 
of any reasonable actuarial method of valuation which
H. R. 4275—5 
takes into account fair market value and which is permitted 
under regulations prescribed by the Secretary of the 
Treasury. 
‘‘(B) DEDICATED BOND PORTFOLIO.—The Secretary of 
the Treasury may by regulations provide that the value 
of any dedicated bond portfolio of a plan shall be deter-
mined by using the interest rate under section 302(b)(5) 
(as in effect on the day before the enactment of the Pension 
Protection Act of 2006). 
‘‘(3) ACTUARIAL ASSUMPTIONS MUST BE REASONABLE.—For 
purposes of this section, all costs, liabilities, rates of interest, 
and other factors under the plan shall be determined on the 
basis of actuarial assumptions and methods— 
‘‘(A) each of which is reasonable (taking into account 
the experience of the plan and reasonable expectations), 
and 
‘‘(B) which, in combination, offer the actuary’s best 
estimate of anticipated experience under the plan. 
‘‘(4) TREATMENT OF CERTAIN CHANGES AS EXPERIENCE GAIN 
OR LOSS.—For purposes of this section, if— 
‘‘(A) a change in benefits under the Social Security 
Act or in other retirement benefits created under Federal 
or State law, or 
‘‘(B) a change in the definition of the term ‘wages’ 
under section 3121 of the Internal Revenue Code of 1986 
or a change in the amount of such wages taken into account 
under regulations 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 treated as an experi-
ence loss or gain. 
‘‘(5) FUNDING METHOD AND PLAN YEAR.— 
‘‘(A) 
FUNDING
METHODS
AVAILABLE.—All 
funding 
methods available to CSEC plans under section 302 (as 
in effect on the day before the enactment of the Pension 
Protection Act of 2006) shall continue to be available under 
this section. 
‘‘(B) CHANGES.—If the funding method for a plan is 
changed, the new funding method shall become the funding 
method used to determine costs and liabilities under the 
plan only if the change is approved by the Secretary of 
the Treasury. If the plan year for a plan is changed, the 
new plan year shall become the plan year for the plan 
only if the change is approved by the Secretary of the 
Treasury. 
‘‘(C) APPROVAL
REQUIRED
FOR
CERTAIN
CHANGES
IN 
ASSUMPTIONS BY CERTAIN SINGLE-EMPLOYER PLANS SUBJECT 
TO ADDITIONAL FUNDING REQUIREMENT.— 
‘‘(i) IN GENERAL.—No actuarial assumption (other 
than the assumptions described in subsection (h)(3)) 
used to determine the current liability for a plan to 
which this subparagraph applies may be changed with-
out the approval of the Secretary of the Treasury. 
‘‘(ii) PLANS
TO
WHICH
SUBPARAGRAPH
APPLIES.— 
This subparagraph shall apply to a plan only if— 
‘‘(I) the plan is a CSEC plan,
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‘‘(II) the aggregate unfunded vested benefits 
as of the close of the preceding plan year (as deter-
mined under section 4006(a)(3)(E)(iii)) of such plan 
and all other plans maintained by the contributing 
sponsors (as defined in section 4001(a)(13)) and 
members of such sponsors’ controlled groups (as 
defined in section 4001(a)(14)) which are covered 
by title IV (disregarding plans with no unfunded 
vested benefits) exceed $50,000,000, and 
‘‘(III) the change in assumptions (determined 
after taking into account any changes in interest 
rate and mortality table) results in a decrease 
in the funding shortfall of the plan for the current 
plan year that exceeds $50,000,000, or that exceeds 
$5,000,000 and that is 5 percent or more of the 
current liability of the plan before such change. 
‘‘(6) FULL FUNDING.—If, as of the close of a plan year, 
a plan would (without regard to this paragraph) have an 
accumulated funding deficiency (determined without regard to 
the alternative minimum funding standard account permitted 
under subsection (e)) in excess of the full funding limitation— 
‘‘(A) the funding standard account shall be credited 
with the amount of such excess, and 
‘‘(B) all amounts described in paragraphs (2)(B), (C), 
and (D) and (3)(B) of subsection (b) which are required 
to be amortized shall be considered fully amortized for 
purposes of such paragraphs. 
‘‘(7) FULL-FUNDING LIMITATION.—For purposes of paragraph 
(6), the term ‘full-funding limitation’ means the excess (if any) 
of— 
‘‘(A) the accrued liability (including normal cost) under 
the plan (determined under the entry age normal funding 
method if such accrued liability cannot be directly cal-
culated under the funding method used for the plan), over 
‘‘(B) the lesser of— 
‘‘(i) the fair market value of the plan’s assets, 
or 
‘‘(ii) the value of such assets determined under 
paragraph (2). 
‘‘(C) MINIMUM AMOUNT.— 
‘‘(i) IN GENERAL.—In no event shall the full-funding 
limitation determined under subparagraph (A) be less 
than the excess (if any) of— 
‘‘(I) 90 percent of the current liability (deter-
mined without regard to paragraph (4) of sub-
section (h)) of the plan (including the expected 
increase in such 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. 
‘‘(8) ANNUAL VALUATION.— 
‘‘(A) IN GENERAL.—For purposes of this section, a deter-
mination of experience gains and losses and a valuation 
of the plan’s liability shall be made not less frequently
H. R. 4275—7 
than once every year, except that such determination shall 
be made more frequently to the extent required in par-
ticular cases under regulations prescribed by the Secretary 
of the Treasury. 
‘‘(B) VALUATION DATE.— 
‘‘(i) CURRENT YEAR.—Except as provided 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 VALUATION.—The valu-
ation referred to in subparagraph (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 current liability. 
‘‘(iii) ADJUSTMENTS.—Information under clause (ii) 
shall, in accordance with regulations, be actuarially 
adjusted to reflect significant differences in partici-
pants. 
‘‘(iv) LIMITATION.—A change in funding 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. 
‘‘(9) TIME WHEN CERTAIN CONTRIBUTIONS DEEMED MADE.— 
For purposes of this section, any contributions for a plan year 
made by an employer during the period— 
‘‘(A) beginning on the day after the last day of such 
plan year, and 
‘‘(B) ending on the day which is 81⁄2 months after 
the close of the plan year, 
shall be deemed to have been made on such last day. 
‘‘(10) ANTICIPATION OF BENEFIT INCREASES EFFECTIVE IN 
THE FUTURE.—In determining projected benefits, the funding 
method of a collectively bargained CSEC plan described in 
section 413(a) of the Internal Revenue Code of 1986 shall 
anticipate benefit increases scheduled to take effect during 
the term of the collective bargaining agreement applicable to 
the plan. 
‘‘(d) EXTENSION
OF AMORTIZATION PERIODS.—The period of 
years required to amortize any unfunded liability (described in 
any clause of subsection (b)(2)(B)) of any plan may be extended 
by the Secretary of the Treasury for a period of time (not in 
excess of 10 years) if such Secretary determines that such extension 
would carry out the purposes of this Act and provide adequate 
protection for participants under the plan and their beneficiaries, 
and if such Secretary determines that the failure to permit such 
extension would result in— 
‘‘(1) a substantial risk to the voluntary continuation of 
the plan, or 
‘‘(2) a substantial curtailment of pension benefit levels or 
employee compensation. 
‘‘(e) ALTERNATIVE MINIMUM FUNDING STANDARD.— 
‘‘(1) IN
GENERAL.—A CSEC plan which uses a funding 
method that requires contributions in all years not less than
H. R. 4275—8 
those required under the entry age normal funding method 
may maintain an alternative minimum funding standard 
account for any plan year. Such account shall be credited and 
charged solely as provided in this subsection. 
‘‘(2) CHARGES AND CREDITS TO ACCOUNT.—For a plan year 
the alternative minimum funding standard account shall be— 
‘‘(A) charged with the sum of— 
‘‘(i) the lesser of normal cost under the funding 
method used under the plan or normal cost determined 
under the unit credit method, 
‘‘(ii) the excess, if any, of the present value of 
accrued benefits under the plan over the fair market 
value of the assets, and 
‘‘(iii) an amount equal to the excess (if any) of 
credits to the alternative minimum standard account 
for all prior plan years over charges to such account 
for all such years, and 
‘‘(B) credited with the amount considered contributed 
by the employer to or under the plan for the plan year. 
‘‘(3) 
INTEREST.—The 
alternative 
minimum 
funding 
standard account (and items therein) shall be charged or cred-
ited with interest in the manner provided under subsection 
(b)(5) with respect to the funding standard account. 
‘‘(f) QUARTERLY CONTRIBUTIONS REQUIRED.— 
‘‘(1) IN GENERAL.—If a CSEC plan which has a funded 
current liability percentage for the preceding plan year of less 
than 100 percent fails to pay the full amount of a required 
installment for the plan year, then the rate of interest charged 
to the funding standard account under subsection (b)(5) with 
respect to the amount of the underpayment for the period 
of the underpayment shall be equal to the greater of— 
‘‘(A) 175 percent of the Federal mid-term rate (as in 
effect under section 1274 of the Internal Revenue Code 
of 1986 for the 1st month of such plan year), or 
‘‘(B) the rate of interest used under the plan in deter-
mining costs. 
‘‘(2) AMOUNT
OF
UNDERPAYMENT, 
PERIOD
OF
UNDER-
PAYMENT.—For purposes of paragraph (1)— 
‘‘(A) AMOUNT.—The amount of the underpayment shall 
be the excess of— 
‘‘(i) the required installment, over 
‘‘(ii) the amount (if any) of the installment contrib-
uted to or under the plan on or before the due date 
for the installment. 
‘‘(B) PERIOD OF UNDERPAYMENT.—The period for which 
interest is charged under this subsection with regard to 
any portion of the underpayment shall run from the due 
date for the installment to the date on which such portion 
is contributed to or under the plan (determined without 
regard to subsection (c)(9)). 
‘‘(C) ORDER OF CREDITING CONTRIBUTIONS.—For pur-
poses of subparagraph (A)(ii), contributions shall be cred-
ited against unpaid required installments in the order in 
which such installments are required to be paid. 
‘‘(3) NUMBER OF REQUIRED INSTALLMENTS; DUE DATES.— 
For purposes of this subsection—
H. R. 4275—9 
‘‘(A) PAYABLE IN 4 INSTALLMENTS.—There shall be 4 
required installments for each plan year. 
‘‘(B) TIME FOR PAYMENT OF INSTALLMENTS.— 
‘‘In the case of the following 
required installments: 
The due date is: 
1st .................................................
April 15
2nd ...............................................
July 15
3rd ................................................
October 15
4th ................................................
January 15 of the following 
year. 
‘‘(4) AMOUNT OF REQUIRED INSTALLMENT.—For purposes of 
this subsection— 
‘‘(A) IN GENERAL.—The amount of any required install-
ment shall be 25 percent of the required annual payment. 
‘‘(B) REQUIRED
ANNUAL
PAYMENT.—For purposes of 
subparagraph (A), the term ‘required annual payment’ 
means the lesser of— 
‘‘(i) 90 percent of the amount required to be contrib-
uted to or under the plan by the employer for the 
plan year under section 302 (without regard to any 
waiver under subsection (c) thereof), or 
‘‘(ii) 100 percent of the amount so required for 
the preceding plan year. 
Clause (ii) shall not apply if the preceding plan year was 
not a year of 12 months. 
‘‘(5) LIQUIDITY REQUIREMENT.— 
‘‘(A) IN
GENERAL.—A plan to which this paragraph 
applies shall be treated as failing to pay the full amount 
of any required installment to the extent that the value 
of the liquid assets paid in such installment is less than 
the liquidity shortfall (whether or not such liquidity short-
fall exceeds the amount of such installment required to 
be paid but for this paragraph). 
‘‘(B) PLANS TO WHICH PARAGRAPH APPLIES.—This para-
graph shall apply to a CSEC plan other than a plan 
described in section 302(d)(6)(A) (as in effect on the day 
before the enactment of the Pension Protection Act of 2006) 
which— 
‘‘(i) is required to pay installments under this sub-
section for a plan year, and 
‘‘(ii) has a liquidity shortfall for any quarter during 
such plan year. 
‘‘(C) PERIOD OF UNDERPAYMENT.—For purposes of para-
graph (1), any portion of an installment that is treated 
as not paid under subparagraph (A) shall continue to be 
treated as unpaid until the close of the quarter in which 
the due date for such installment occurs. 
‘‘(D) LIMITATION ON INCREASE.—If the amount of any 
required installment is increased by reason of subpara-
graph (A), in no event shall such increase exceed the 
amount which, when added to prior installments for the 
plan year, is necessary to increase the funded current 
liability percentage (taking into account the expected
H. R. 4275—10 
increase in current liability due to benefits accruing during 
the plan year) to 100 percent. 
‘‘(E) DEFINITIONS.—For purposes of this paragraph— 
‘‘(i) LIQUIDITY
SHORTFALL.—The term ‘liquidity 
shortfall’ means, with respect to any required install-
ment, an amount equal to the excess (as of the last 
day of the quarter for which such installment is made) 
of the base amount with respect to such quarter over 
the value (as of such last day) of the plan’s liquid 
assets. 
‘‘(ii) BASE AMOUNT.— 
‘‘(I) IN
GENERAL.—The term ‘base amount’ 
means, with respect to any quarter, an amount 
equal to 3 times the sum of the adjusted disburse-
ments from the plan for the 12 months ending 
on the last day of such quarter. 
‘‘(II) SPECIAL RULE.—If the amount determined 
under subclause (I) exceeds an amount equal to 
2 times the sum of the adjusted disbursements 
from the plan for the 36 months ending on the 
last day of the quarter and an enrolled actuary 
certifies to the satisfaction of the Secretary of the 
Treasury that such excess is the result of non-
recurring circumstances, the base amount with 
respect to such quarter shall be determined with-
out regard to amounts related to those non-
recurring circumstances. 
‘‘(iii) DISBURSEMENTS FROM THE PLAN.—The term 
‘disbursements from the plan’ means all disbursements 
from the trust, including purchases of annuities, pay-
ments of single sums and other benefits, and adminis-
trative expenses. 
‘‘(iv) 
ADJUSTED
DISBURSEMENTS.—The 
term 
‘adjusted disbursements’ means disbursements from 
the plan reduced by the product of— 
‘‘(I) the plan’s funded current liability percent-
age for the plan year, and 
‘‘(II) the sum of the purchases of annuities, 
payments of single sums, and such other disburse-
ments as the Secretary of the Treasury shall pro-
vide in regulations. 
‘‘(v) LIQUID
ASSETS.—The term ‘liquid assets’ 
means cash, marketable securities and such other 
assets as specified by the Secretary of the Treasury 
in regulations. 
‘‘(vi) QUARTER.—The term ‘quarter’ means, with 
respect to any required installment, the 3-month period 
preceding the month in which the due date for such 
installment occurs. 
‘‘(F) REGULATIONS.—The Secretary of the Treasury may 
prescribe such regulations as are necessary to carry out 
this paragraph. 
‘‘(6) FISCAL YEARS AND SHORT YEARS.— 
‘‘(A) FISCAL YEARS.—In applying this subsection to a 
plan year beginning on any date other than January 1, 
there shall be substituted for the months specified in this 
subsection, the months which correspond thereto.
H. R. 4275—11 
‘‘(B) SHORT
PLAN
YEAR.—This subsection shall be 
applied to plan years of less than 12 months in accordance 
with regulations prescribed by the Secretary of the 
Treasury. 
‘‘(g) IMPOSITION OF LIEN WHERE FAILURE TO MAKE REQUIRED 
CONTRIBUTIONS.— 
‘‘(1) IN
GENERAL.—In the case of a plan to which this 
section applies, if— 
‘‘(A) any person fails to make a required installment 
under subsection (f) or any other payment required under 
this section before the due date for such installment or 
other payment, and 
‘‘(B) the unpaid balance of such installment or other 
payment (including interest), when added to the aggregate 
unpaid balance of all preceding such installments or other 
payments for which payment was not made before the 
due date (including interest), exceeds $1,000,000, 
then there shall be a lien in favor of the plan in the amount 
determined under paragraph (3) upon all property and rights 
to property, whether real or personal, belonging to such person 
and any other person who is a member of the same controlled 
group of which such person is a member. 
‘‘(2) PLANS TO WHICH SUBSECTION APPLIES.—This subsection 
shall apply to a CSEC plan for any plan year for which the 
funded current liability percentage of such plan is less than 
100 percent. This subsection shall not apply to any plan to 
which section 4021 does not apply (as such section is in effect 
on the date of the enactment of the Retirement Protection 
Act of 1994). 
‘‘(3) AMOUNT OF LIEN.—For purposes of paragraph (1), the 
amount of the lien shall be equal to the aggregate unpaid 
balance of required installments and other payments required 
under this section (including interest)— 
‘‘(A) for plan years beginning after 1987, and 
‘‘(B) for which payment has not been made before 
the due date. 
‘‘(4) NOTICE OF FAILURE; LIEN.— 
‘‘(A) NOTICE
OF
FAILURE.—A person committing a 
failure described in paragraph (1) shall notify the Pension 
Benefit Guaranty Corporation of such failure within 10 
days of the due date for the required installment or other 
payment. 
‘‘(B) PERIOD OF LIEN.—The lien imposed by paragraph 
(1) shall arise on the due date for the required installment 
or other payment and shall continue until the last day 
of the first plan year in which the plan ceases to be 
described in paragraph (1)(B). Such lien shall continue 
to run without regard to whether such plan continues 
to be described in paragraph (2) during the period referred 
to in the preceding sentence. 
‘‘(C) CERTAIN
RULES
TO
APPLY.—Any amount with 
respect to which a lien is imposed under paragraph (1) 
shall be treated as taxes due and owing the United States 
and rules similar to the rules of subsections (c), (d), and 
(e) of section 4068 shall apply with respect to a lien imposed 
by subsection (a) and the amount with respect to such 
lien.
H. R. 4275—12 
‘‘(5) ENFORCEMENT.—Any lien created under paragraph (1) 
may be perfected and enforced only by the Pension Benefit 
Guaranty Corporation, or at the direction of the Pension Benefit 
Guaranty Corporation, by any contributing employer (or any 
member of the controlled group of the contributing employer). 
‘‘(6) DEFINITIONS.—For purposes of this subsection— 
‘‘(A) DUE DATE; REQUIRED INSTALLMENT.—The terms 
‘due date’ and ‘required installment’ have the meanings 
given such terms by subsection (f), except that in the case 
of a payment other than a required installment, the due 
date shall be the date such payment is required to be 
made under this section. 
‘‘(B) CONTROLLED GROUP.—The term ‘controlled group’ 
means any group treated as a single employer under sub-
sections (b), (c), (m), and (o) of section 414 of the Internal 
Revenue Code of 1986. 
‘‘(h) CURRENT LIABILITY.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘current liability’ means all 
liabilities to employees and their beneficiaries under the plan. 
‘‘(2) TREATMENT
OF
UNPREDICTABLE
CONTINGENT
EVENT 
BENEFITS.— 
‘‘(A) IN GENERAL.—For purposes of paragraph (1), any 
unpredictable contingent event benefit shall not be taken 
into account until the event on which the benefit is contin-
gent occurs. 
‘‘(B) UNPREDICTABLE
CONTINGENT
EVENT
BENEFIT.— 
The term ‘unpredictable contingent event benefit’ means 
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). 
‘‘(3) INTEREST RATE AND MORTALITY ASSUMPTIONS USED.— 
‘‘(A) INTEREST RATE.—The rate of interest used to deter-
mine current liability under this section shall be the third 
segment rate determined under section 303(h)(2)(C). 
‘‘(B) MORTALITY TABLES.— 
‘‘(i) SECRETARIAL AUTHORITY.—The Secretary of the 
Treasury may by regulation prescribe mortality tables 
to be used in determining current liability under this 
subsection. Such tables shall be based upon the actual 
experience of pension plans and projected trends in 
such experience. In prescribing such tables, the Sec-
retary of the Treasury shall take into account results 
of available independent studies of mortality of individ-
uals covered by pension plans. 
‘‘(ii) PERIODIC
REVIEW.—The Secretary of the 
Treasury shall periodically (at least every 5 years) 
review any tables in effect under this subsection and 
shall, to the extent the Secretary of the Treasury deter-
mines necessary, by regulation update the tables to 
reflect the actual experience of pension plans and pro-
jected trends in such experience. 
‘‘(C) SEPARATE MORTALITY TABLES FOR THE DISABLED.— 
Notwithstanding subparagraph (B)—
H. R. 4275—13 
‘‘(i) IN GENERAL.—In the case of plan years begin-
ning after December 31, 1995, the Secretary of the 
Treasury shall establish mortality tables which may 
be used (in lieu of the tables under subparagraph 
(B)) to determine current liability under this subsection 
for individuals who are entitled to benefits under the 
plan on account of disability. The Secretary of the 
Treasury shall establish separate tables for individuals 
whose disabilities occur in plan years beginning before 
January 1, 1995, and for individuals whose disabilities 
occur in plan years beginning on or after such date. 
‘‘(ii) SPECIAL
RULE
FOR
DISABILITIES
OCCURRING 
AFTER 1994.—In the case of disabilities occurring in 
plan years beginning after December 31, 1994, the 
tables under clause (i) shall apply only with respect 
to individuals described in such subclause who are 
disabled within the meaning of title II of the Social 
Security Act and the regulations thereunder. 
‘‘(4) CERTAIN SERVICE DISREGARDED.— 
‘‘(A) IN GENERAL.—In the case of a participant to whom 
this paragraph applies, only the applicable percentage of 
the years of service before such individual became a partici-
pant shall be taken into account in computing the current 
liability of the plan. 
‘‘(B) APPLICABLE PERCENTAGE.—For purposes of this 
subparagraph, the applicable percentage shall be deter-
mined as follows: 
‘‘If the years of participation 
are: 
The applicable percentage 
is: 
1 .....................................................
2 .....................................................
3 .....................................................
4 .....................................................
5 or more .......................................
100. 
‘‘(C) PARTICIPANTS TO WHOM PARAGRAPH APPLIES.—This 
subparagraph shall apply to any participant who, at the 
time of becoming a participant— 
‘‘(i) has not accrued any other benefit under any 
defined benefit plan (whether or not terminated) main-
tained by the employer or a member of the same con-
trolled group of which the employer is a member, 
‘‘(ii) who first becomes a participant under the 
plan in a plan year beginning after December 31, 1987, 
and 
‘‘(iii) has years of service greater than the min-
imum years of service necessary for eligibility to 
participate in the plan. 
‘‘(D) ELECTION.—An employer may elect not to have 
this subparagraph apply. Such an election, once made, 
may be revoked only with the consent of the Secretary 
of the Treasury.
H. R. 4275—14 
‘‘(i) FUNDED CURRENT LIABILITY PERCENTAGE.—For purposes 
of this section, the term ‘funded current liability percentage’ means, 
with respect to any plan year, the percentage which— 
‘‘(1) the value of the plan’s assets determined under sub-
section (c)(2), is of 
‘‘(2) the current liability under the plan. 
‘‘(j) FUNDING
RESTORATION
STATUS.—Notwithstanding any 
other provisions of this section— 
‘‘(1) NORMAL COST PAYMENT.— 
‘‘(A) IN GENERAL.—In the case of a CSEC plan that 
is in funding restoration status for a plan year, for purposes 
of section 302, the term ‘accumulated funding deficiency’ 
means, for such plan year, the greater of— 
‘‘(i) the amount described in subsection (a), or 
‘‘(ii) the excess of the normal cost of the plan 
for the plan year over the amount actually contributed 
to or under the plan for the plan year. 
‘‘(B) NORMAL COST.—In the case of a CSEC plan that 
uses a spread gain funding method, for purposes of this 
subsection, the term ‘normal cost’ means normal cost as 
determined under the entry age normal funding method. 
‘‘(2) PLAN AMENDMENTS.—In the case of a CSEC plan that 
is in funding restoration status for a plan year, no amendment 
to such plan may take effect during such plan year if such 
amendment has the effect of increasing liabilities of the plan 
by means of increases in benefits, establishment of new benefits, 
changing the rate of benefit accrual, or changing the rate at 
which benefits become nonforfeitable. This paragraph shall not 
apply to any plan amendment that is required to comply with 
any applicable law. This paragraph shall cease to apply with 
respect to any plan year, effective as of the first day of the 
plan year (or if later, the effective date of the amendment) 
upon payment by the plan sponsor of a contribution to the 
plan (in addition to any contribution required under this section 
without regard to this paragraph) in an amount equal to the 
increase in the funding liability of the plan attributable to 
the plan amendment. 
‘‘(3) FUNDING RESTORATION PLAN.—The sponsor of a CSEC 
plan shall establish a written funding restoration plan within 
180 days of the receipt by the plan sponsor of a certification 
from the plan actuary that the plan is in funding restoration 
status for a plan year. Such funding restoration plan shall 
consist of actions that are calculated, based on reasonably 
anticipated experience and reasonable actuarial assumptions, 
to increase the plan’s funded percentage to 100 percent over 
a period that is not longer than the greater of 7 years or 
the shortest amount of time practicable. Such funding restora-
tion plan shall take into account contributions required under 
this section (without regard to this paragraph). If a plan 
remains in funding restoration status for 2 or more years, 
such funding restoration plan shall be updated each year after 
the 1st such year within 180 days of receipt by the plan sponsor 
of a certification from the plan actuary that the plan remains 
in funding restoration status for the plan year. 
‘‘(4) ANNUAL CERTIFICATION BY PLAN ACTUARY.—Not later 
than the 90th day of each plan year of a CSEC plan, the 
plan actuary shall certify to the plan sponsor whether or not
H. R. 4275—15 
the plan is in funding restoration status for the plan year, 
based on the plan’s funded percentage as of the beginning 
of the plan year. For this purpose, the actuary may conclusively 
rely on an estimate of— 
‘‘(A) the plan’s funding liability, based on the funding 
liability of the plan for the preceding plan year and on 
reasonable actuarial estimates, assumptions, and methods, 
and 
‘‘(B) the amount of any contributions reasonably antici-
pated to be made for the preceding plan year. 
Contributions described in subparagraph (B) shall be taken 
into account in determining the plan’s funded percentage as 
of the beginning of the plan year. 
‘‘(5) DEFINITIONS.—For purposes of this subsection— 
‘‘(A) FUNDING
RESTORATION
STATUS.—A CSEC plan 
shall be treated as in funding restoration status for a 
plan year if the plan’s funded percentage as of the begin-
ning of such plan year is less than 80 percent. 
‘‘(B) FUNDED PERCENTAGE.—The term ‘funded percent-
age’ means the ratio (expressed as a percentage) which— 
‘‘(i) the value of plan assets (as determined under 
subsection (c)(2)), bears to 
‘‘(ii) the plan’s funding liability. 
‘‘(C) FUNDING LIABILITY.—The term ‘funding liability’ 
for a plan year means the present value of all benefits 
accrued or earned under the plan as of the beginning 
of the plan year, based on the assumptions used by the 
plan pursuant to this section, including the interest rate 
described in subsection (b)(5)(A) (without regard to sub-
section (b)(5)(B)). 
‘‘(D) SPREAD GAIN FUNDING METHOD.—The term ‘spread 
gain funding method’ has the meaning given such term 
under rules and forms issued by the Secretary of the 
Treasury.’’. 
(b) SEPARATE RULES FOR CSEC PLANS.— 
(1) IN GENERAL.—Paragraph (2) of section 302(a) of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1082(a)) is amended by striking ‘‘and’’ at the end of subpara-
graph (B), by striking the period at the end of subparagraph 
(C) and inserting ‘‘, and’’, and by inserting at the end thereof 
the following new subparagraph: 
‘‘(D) in the case of a CSEC plan, the employers make 
contributions to or under the plan for any plan year which, 
in the aggregate, are sufficient to ensure that the plan 
does not have an accumulated funding deficiency under 
section 306 as of the end of the plan year.’’. 
(2) 
CONFORMING
AMENDMENTS.—Section 
302 
of 
the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1082) is amended— 
(A) by striking ‘‘multiemployer plan’’ the first place 
it appears in clause (i) of subsection (c)(1)(A) and the last 
place it appears in paragraph (2) of subsection (d), and 
inserting ‘‘multiemployer plan or a CSEC plan’’, 
(B) by striking ‘‘303(j)’’ in paragraph (1) of subsection 
(b) and inserting ‘‘303(j) or under section 306(f)’’, 
(C)(i) by striking ‘‘and’’ at the end of clause (i) of 
subsection (c)(1)(B),
H. R. 4275—16 
(ii) by striking the period at the end of clause (ii) 
of subsection (c)(1)(B), and inserting ‘‘, and’’, and 
(iii) by inserting the following new clause after clause 
(ii) of subsection (c)(1)(B): 
‘‘(iii) in the case of a CSEC plan, the funding 
standard account shall be credited under section 
306(b)(3)(C) with the amount of the waived funding 
deficiency and such amount shall be amortized as 
required under section 306(b)(2)(C).’’, 
(D) by striking ‘‘under paragraph (1)’’ in clause (i) 
of subsection (c)(4)(A) and inserting ‘‘under paragraph (1) 
or for granting an extension under section 306(d)’’, 
(E) by striking ‘‘waiver under this subsection’’ in 
subparagraph (B) of subsection (c)(4) and inserting ‘‘waiver 
under this subsection or an extension under 306(d)’’, 
(F) by striking ‘‘waiver or modification’’ in subclause 
(I) of subsection (c)(4)(B)(i) and inserting ‘‘waiver, modifica-
tion, or extension’’, 
(G) by striking ‘‘waivers’’ in the heading of subsection 
(c)(4)(C) and of clause (ii) of subsection (c)(4)(C) and 
inserting ‘‘waivers or extensions’’, 
(H) by striking ‘‘section 304(d)’’ in subparagraph (A) 
of subsection (c)(7) and in paragraph (2) of subsection (d) 
and inserting ‘‘section 304(d) or section 306(d)’’, 
(I) by striking ‘‘and’’ at the end of subclause (I) of 
subsection (c)(4)(C)(i) and adding ‘‘or the accumulated 
funding deficiency under section 306, whichever is 
applicable,’’, 
(J) by striking ‘‘303(e)(2),’’ in subclause (II) of sub-
section (c)(4)(C)(i) and inserting ‘‘303(e)(2) or 306(b)(2)(C), 
whichever is applicable, and’’, 
(K) by adding immediately after subclause (II) of sub-
section (c)(4)(C)(i) the following new subclause: 
‘‘(III) the total amounts not paid by reason 
of an extension in effect under section 306(d),’’, 
(L) by striking ‘‘for waivers of’’ in clause (ii) of sub-
section (c)(4)(C) and inserting ‘‘for waivers or extensions 
with respect to’’, and 
(M) by striking ‘‘single-employer plan’’ in subparagraph 
(A) of subsection (a)(2) and in clause (i) of subsection 
(c)(1)(B) and inserting ‘‘single-employer plan (other than 
a CSEC plan)’’. 
(3) BENEFIT RESTRICTIONS.—Subsection (g) of section 206 
of the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1056) is amended by adding at the end thereof the 
following new paragraph: 
‘‘(12) CSEC PLANS.—This subsection shall not apply to a 
CSEC plan (as defined in section 210(f)).’’. 
(4) BENEFIT INCREASES.—Paragraph (3) of section 204(i) 
of the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1054(i)) is amended by striking ‘‘multiemployer plans’’ 
and inserting ‘‘multiemployer plans or CSEC plans’’. 
(5) SECTION
103.—Subparagraph (B) of section 103(d)(8) 
of the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1023(d)(8)) is amended by striking ‘‘303(h) and 304(c)(3)’’ 
and inserting ‘‘303(h), 304(c)(3), and 306(c)(3)’’.
H. R. 4275—17 
(6) SECTION
502.—Subsection (c) of section 502 of the 
Employee Retirement Income Security Act of 1974 is amended— 
(A) by redesignating the last paragraph as paragraph 
(11), and 
(B) by adding at the end the following new paragraph: 
‘‘(12) The Secretary may assess a civil penalty against 
any sponsor of a CSEC plan of up to $100 a day from the 
date of the plan sponsor’s failure to comply with the require-
ments of section 306(j)(3) to establish or update a funding 
restoration plan.’’. 
(7) SECTION 4003.—Subparagraph (B) of section 4003(e)(1) 
of the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1303(e)(1)) is amended by striking ‘‘303(k)(1)(A) and 
(B) of this Act or section 430(k)(1)(A) and (B) of the Internal 
Revenue Code of 1986’’ and inserting ‘‘303(k)(1)(A) and (B) 
or 306(g)(1)(A) and (B) of this Act or section 430(k)(1)(A) and 
(B) or 433(g)(1)(A) and (B) of the Internal Revenue Code of 
1986’’. 
(8) SECTION 4010.—Paragraph (2) of section 4010(b) of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1310(b)) is amended by striking ‘‘303(k)(1)(A) and (B) of this 
Act or section 430(k)(1)(A) and (B) of the Internal Revenue 
Code of 1986’’ and inserting ‘‘303(k)(1)(A) and (B) or 306(g)(1)(A) 
and (B) of this Act or section 430(k)(1)(A) and (B) or 433(g)(1)(A) 
and (B) of the Internal Revenue Code of 1986’’. 
(9) SECTION 4071.—Section 4071 of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 1371) is amended 
by striking ‘‘section 303(k)(4)’’ and inserting ‘‘section 303(k)(4) 
or 306(g)(4)’’. 
SEC. 103. ELECTIONS. 
(a) ELECTION NOT TO BE TREATED AS A CSEC PLAN.—Sub-
section (f) of section 210 of the Employee Retirement Income Secu-
rity Act of 1974, as added by section 101, is amended by adding 
at the end the following new paragraph: 
‘‘(3) ELECTION.— 
‘‘(A) IN GENERAL.—If a plan falls within the definition 
of a CSEC plan under this subsection (without regard 
to this paragraph), such plan shall be a CSEC plan unless 
the plan sponsor elects not later than the close of the 
first plan year of the plan beginning after December 31, 
2013, not to be treated as a CSEC plan. An election under 
the preceding sentence shall take effect for such plan year 
and, once made, may be revoked only with the consent 
of the Secretary of the Treasury. 
‘‘(B) SPECIAL RULE.—If a plan described in subpara-
graph (A) is treated as a CSEC plan, section 104 of the 
Pension Protection Act of 2006, as amended by the 
Preservation of Access to Care for Medicare Beneficiaries 
and Pension Relief Act of 2010, shall cease to apply to 
such plan as of the first date as of which such plan is 
treated as a CSEC plan.’’. 
(b) ELECTION TO CEASE TO BE TREATED
AS
AN ELIGIBLE 
CHARITY PLAN.—Subsection (d) of section 104 of the Pension Protec-
tion Act of 2006, as added by section 202 of the Preservation 
of Access to Care for Medicare Beneficiaries and Pension Relief 
Act of 2010, is amended—
H. R. 4275—18 
(1) by striking ‘‘For purposes of’’ and inserting ‘‘(1) IN 
GENERAL.—For purposes of’’, and 
(2) by adding at the end the following: 
‘‘(2) ELECTION NOT TO BE AN ELIGIBLE CHARITY PLAN.— 
A plan sponsor may elect for a plan to cease to be treated 
as an eligible charity plan for plan years beginning after 
December 31, 2013. Such election shall be made at such time 
and in such form and manner as shall be prescribed by the 
Secretary of the Treasury. Any such election may be revoked 
only with the consent of the Secretary of the Treasury. 
‘‘(3) ELECTION
TO
USE
FUNDING
OPTIONS
AVAILABLE
TO 
OTHER PLAN SPONSORS.— 
‘‘(A) A plan sponsor that makes the election described 
in paragraph (2) may elect for a plan to apply the rules 
described in subparagraphs (B), (C), and (D) for plan years 
beginning after December 31, 2013. Such election shall 
be made at such time and in such form and manner as 
shall be prescribed by the Secretary of the Treasury. Any 
such election may be revoked only with the consent of 
the Secretary of the Treasury. 
‘‘(B) Under the rules described in this subparagraph, 
for the first plan year beginning after December 31, 2013, 
a plan has— 
‘‘(i) an 11-year shortfall amortization base, 
‘‘(ii) a 12-year shortfall amortization base, and 
‘‘(iii) a 7-year shortfall amortization base. 
‘‘(C) Under the rules described in this subparagraph, 
section 303(c)(2)(A) and (B) of the Employee Retirement 
Income Security Act of 1974, and section 430(c)(2)(A) and 
(B) of the Internal Revenue Code of 1986 shall be applied 
by— 
‘‘(i) in the case of an 11-year shortfall amortization 
base, substituting ‘11-plan-year period’ for ‘7-plan-year 
period’ wherever such phrase appears, and 
‘‘(ii) in the case of a 12-year shortfall amortization 
base, substituting ‘12-plan-year period’ for ‘7-plan-year 
period’ wherever such phrase appears. 
‘‘(D) Under the rules described in this subparagraph, 
section 303(c)(7) of the Employee Retirement Income Secu-
rity Act of 1974 and section 430(c)(7) of the Internal Rev-
enue Code of 1986 shall apply to a plan for which an 
election has been made under subparagraph (A). Such 
provisions shall apply in the following manner: 
‘‘(i) The first plan year beginning after December 
31, 2013, shall be treated as an election year, and 
no other plan years shall be so treated. 
‘‘(ii) All references in section 303(c)(7) of such Act 
and section 430(c)(7) of such Code to ‘February 28, 
2010’ or ‘March 1, 2010’ shall be treated as references 
to ‘February 28, 2013’ or ‘March 1, 2013’, respectively. 
‘‘(E) For purposes of this paragraph, the 11-year 
amortization base is an amount, determined for the first 
plan year beginning after December 31, 2013, equal to 
the unamortized principal amount of the shortfall amortiza-
tion base (as defined in section 303(c)(3) of the Employee 
Retirement Income Security Act of 1974 and section 
430(c)(3) of the Internal Revenue Code of 1986) that would
H. R. 4275—19 
have applied to the plan for the first plan beginning after 
December 31, 2009, if— 
‘‘(i) the plan had never been an eligible charity 
plan, 
‘‘(ii) the plan sponsor had made the election 
described in section 303(c)(2)(D)(i) of the Employee 
Retirement Income Security Act of 1974 and in section 
430(c)(2)(D)(i) of the Internal Revenue Code of 1986 
to have section 303(c)(2)(D)(i) of such Act and section 
430(c)(2)(D)(iii) of such Code apply with respect to the 
shortfall amortization base for the first plan year begin-
ning after December 31, 2009, and 
‘‘(iii) no event had occurred under paragraph (6) 
or (7) of section 303(c) of such Act or paragraph (6) 
or (7) of section 430(c) of such Code that, as of the 
first day of the first plan year beginning after 
December 31, 2013, would have modified the shortfall 
amortization base or the shortfall amortization install-
ments with respect to the first plan year beginning 
after December 31, 2009. 
‘‘(F) For purposes of this paragraph, the 12-year 
amortization base is an amount, determined for the first 
plan year beginning after December 31, 2013, equal to 
the unamortized principal amount of the shortfall amortiza-
tion base (as defined in section 303(c)(3) of the Employee 
Retirement Income Security Act of 1974 and section 
430(c)(3) of the Internal Revenue Code of 1986) that would 
have applied to the plan for the first plan beginning after 
December 31, 2010, if— 
‘‘(i) the plan had never been an eligible charity 
plan, 
‘‘(ii) the plan sponsor had made the election 
described in section 303(c)(2)(D)(i) of the Employee 
Retirement Income Security Act of 1974 and in section 
430(c)(2)(D)(i) of the Internal Revenue Code of 1986 
to have section 303(c)(2)(D)(i) of such Act and section 
430(c)(2)(D)(iii) of such Code apply with respect to the 
shortfall amortization base for the first plan year begin-
ning after December 31, 2010, and 
‘‘(iii) no event had occurred under paragraph (6) 
or (7) of section 303(c) of such Act or paragraph (6) 
or (7) of section 430(c) of such Code that, as of the 
first day of the first plan year beginning after 
December 31, 2013, would have modified the shortfall 
amortization base or the shortfall amortization install-
ments with respect to the first plan year beginning 
after December 31, 2010. 
‘‘(G) For purposes of this paragraph, the 7-year short-
fall amortization base is an amount, determined for the 
first plan year beginning after December 31, 2013, equal 
to— 
‘‘(i) the shortfall amortization base for the first 
plan year beginning after December 31, 2013, without 
regard to this paragraph, minus 
‘‘(ii) the sum of the 11-year shortfall amortization 
base and the 12-year shortfall amortization base.
H. R. 4275—20 
‘‘(4) RETROACTIVE ELECTION.—Not later than December 31, 
2014, a plan sponsor may make a one-time, irrevocable, retro-
active election to not be treated as an eligible charity plan. 
Such election shall be effective for plan years beginning after 
December 31, 2007, and shall be made by providing reasonable 
notice to the Secretary of the Treasury.’’. 
(c) DEEMED ELECTION.—For purposes of the Internal Revenue 
Code of 1986, sections 4(b)(2) and 4021(b)(3) of the Employee Retire-
ment Income Security Act of 1974, and all other purposes, a plan 
shall be deemed to have made an irrevocable election under section 
410(d) of the Internal Revenue Code of 1986 if— 
(1) the plan was established before January 1, 2014; 
(2) the plan falls within the definition of a CSEC plan; 
(3) the plan sponsor does not make an election under 
section 210(f)(3)(A) of the Employee Retirement Income Security 
Act of 1974 and section 414(y)(3)(A) of the Internal Revenue 
Code of 1986, as added by this Act; and 
(4) the plan, plan sponsor, administrator, or fiduciary 
remits one or more premium payments for the plan to the 
Pension Benefit Guaranty Corporation for a plan year beginning 
after December 31, 2013. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply as of the date of enactment of this Act. 
SEC. 104. TRANSPARENCY. 
(a) NOTICE TO PARTICIPANTS.— 
(1) IN GENERAL.—Paragraph (2) of section 101(f) of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1021(f)) is amended by adding at the end the following new 
subparagraph: 
‘‘(E) EFFECT OF CSEC PLAN RULES ON PLAN FUNDING.— 
In the case of a CSEC plan, each notice under paragraph 
(1) shall include— 
‘‘(i) a statement that different rules apply to CSEC 
plans than apply to single-employer plans, 
‘‘(ii) for the first 2 plan years beginning after 
December 31, 2013, a statement that, as a result of 
changes in the law made by the Cooperative and Small 
Employer Charity Pension Flexibility Act, the contribu-
tions to the plan may have changed, and 
‘‘(iii) in the case of a CSEC plan that is in funding 
restoration status for the plan year, a statement that 
the plan is in funding restoration status for such plan 
year. 
A copy of the statement required under clause (iii) shall 
be provided to the Secretary, the Secretary of the Treasury, 
and the Director of the Pension Benefit Guaranty Corpora-
tion.’’. 
(2) MODEL NOTICE.—The Secretary of Labor may modify 
the model notice required to be published under section 501(c) 
of the Pension Protection Act of 2006 to include the information 
described in section 101(f)(2)(E) of the Employee Retirement 
Income Security Act of 1974, as added by this subsection. 
(b) NOTICE OF FAILURE TO MEET MINIMUM FUNDING STAND-
ARDS.— 
(1) PENDING WAIVERS.—Paragraph (2) of section 101(d) of 
the Employee Retirement Income Security Act of 1974 (29