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is expected to be fully funded in the
year following the year in which the
increase or other change takes effect,
and any increase in the plan’s accrued
liabilities attributable to the benefit in-
crease or other change is expected to be
fully funded by the end of the third
plan year following the end of the last
hiatus period of the plan, or
‘‘(III) the plan amendment is oth-
erwise described in subparagraph (A)
or (C) of subsection (f)(2).
‘‘(iii) COLLECTIVELY
BARGAINED
IN-
CREASES
IN
CONTRIBUTIONS.—Clause (ii)
shall not apply to an increase in benefits
for a group of participants resulting solely
from a collectively bargained increase in the
contributions made on their behalf.
‘‘(iv) HIATUS PERIOD DEFINED.—For
purposes of this subparagraph, the term ‘hi-
atus period’ means any period during
which the amortization of a net experience
loss is suspended by reason of this subpara-
graph.
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‘‘(v) INTEREST ACCRUED DURING HIA-
TUS.—Interest accrued on any net experi-
ence loss during a hiatus period shall be
charged to a reconciliation account and not
to the funding standard account.
‘‘(vi) ELECTION.—An election under
this subparagraph shall be made at such
time and in such manner as the Secretary
of Labor, after consultation with the Sec-
retary, may prescribe.’’
(2) 
QUALIFICATION
REQUIREMENT.—Section
401(a) of such Code is amended by inserting after
paragraph (34) the following new paragraph:
‘‘(35) BENEFIT INCREASES IN CERTAIN MULTI-
EMPLOYER PLANS.—A trust which is part of a plan
shall not constitute a qualified trust under this sec-
tion if the plan adopts an amendment during a hia-
tus 
period 
(within 
the 
meaning 
of 
section
412(b)(7)(F)(iv)) which the plan is prohibited from
adopting by reason of section 412(b)(7)(F)(ii).’’.
SEC. 6. 2-YEAR EXTENSION OF TRANSITION RULE TO PEN-
SION FUNDING REQUIREMENTS.
(a) IN GENERAL.—Section 769(c) of the Retirement
Protection Act of 1994, as added by section 1508 of the Tax-
payer Relief Act of 1997, is amended—
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(1) by inserting ‘‘except as provided in para-
graph (3),’’ before ‘‘the transition rules’’, and
(2) by adding at the end the following:
‘‘(3) SPECIAL RULES.—In the case of plan years begin-
ning in 2004 and 2005, the following transition rules shall
apply in lieu of the transition rules described in paragraph
(2):
‘‘(A) For purposes of section 412(l)(9)(A) of
the Internal Revenue Code of 1986 and section
302(d)(9)(A) of the Employee Retirement Income
Security Act of 1974, the funded current liability
percentage for any plan year shall be treated as
not less than 90 percent.
‘‘(B) For purposes of section 412(m) of the
Internal Revenue Code of 1986 and section
302(e) of the Employee Retirement Income Secu-
rity Act of 1974, the funded current liability
percentage for any plan year shall be treated as
not less than 100 percent.
‘‘(C) For purposes of determining unfunded
vested benefits under section 4006(a)(3)(E)(iii)
of the Employee Retirement Income Security Act
of 1974, the mortality table shall be the mor-
tality table used by the plan.’’
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(b) EFFECTIVE DATE.—The amendments made by this
section shall apply to plan years beginning after December
31, 2003.
SEC. 7. PROCEDURES APPLICABLE TO DISPUTES INVOLV-
ING PENSION PLAN WITHDRAWAL LIABILITY.
(a) IN GENERAL.—Section 4221 of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 1401) is
amended by adding at the end the following new subsection:
‘‘(f) PROCEDURES APPLICABLE
TO CERTAIN DIS-
PUTES.—
‘‘(1) IN GENERAL.—If—
‘‘(A) a plan sponsor of a plan determines
that—
‘‘(i) a complete or partial withdrawal
of an employer has occurred, or
‘‘(ii) an employer is liable for with-
drawal liability payments with respect to
the complete or partial withdrawal of an
employer from the plan,
‘‘(B) such determination is based in whole
or in part on a finding by the plan sponsor
under section 4212(c) that a principal purpose
of a transaction that occurred before January 1,
1999, was to evade or avoid withdrawal liability
under this subtitle, and
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‘‘(C) such transaction occurred at least 5
years before the date of the complete or partial
withdrawal,
then the special rules under paragraph (2) shall be
used in applying subsections (a) and (d) of this sec-
tion and section 4219(c) to the employer.
‘‘(2) SPECIAL RULES.—
‘‘(A) 
DETERMINATION.—Notwithstanding
subsection (a)(3)—
‘‘(i) a determination by the plan spon-
sor under paragraph (1)(B) shall not be
presumed to be correct, and
‘‘(ii) the plan sponsor shall have the
burden to establish, by a preponderance of
the evidence, the elements of the claim under
section 4212(c) that a principal purpose of
the transaction was to evade or avoid with-
drawal liability under this subtitle.
Nothing in this subparagraph shall affect the
burden of establishing any other element of a
claim for withdrawal liability under this sub-
title.
‘‘(B) PROCEDURE.—Notwithstanding sub-
section (d) and section 4219(c), if an employer
contests the plan sponsor’s determination under
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paragraph (1) through an arbitration proceeding
pursuant to subsection (a), or through a claim
brought in a court of competent jurisdiction, the
employer shall not be obligated to make any
withdrawal liability payments until a final deci-
sion in the arbitration proceeding, or in court,
upholds the plan sponsor’s determination.’’.
(b) EFFECTIVE DATE.—The amendments made by this
section shall apply to any employer that receives a notifica-
tion under section 4219(b)(1) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1399(b)(1)) after
October 31, 2003.
SEC. 8. SENSE OF THE SENATE ON STATUS OF PRIVATE
PENSION PLANS.
(a) FINDINGS.—Congress makes the following findings:
(1) The private pension system is integral to the
retirement security of Americans, along with indi-
vidual savings and Social Security.
(2) The Pension Benefit Guaranty Corporation
(PBGC) is responsible for insuring the nation’s pri-
vate pension system, and currently insures the pen-
sions of 34,500,000 participants in 29,500 single-em-
ployer plans, and 9,700,000 participants in more
than 1,600 multiemployer plans.
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(6) This pension plan underfunding is con-
centrated in mature and often-declining industries,
where plan liabilities will come due sooner.
(7) Neither the Senate Committee on Finance
nor the Senate Committee on Health, Education,
Labor and Pensions (HELP), the committees of juris-
diction over pension matters, has held hearings this
Congress nor reported legislation addressing the fund-
ing of multiemployer pension plans;
(8) The Senate is concerned about the current
funding status of the private pension system, both
single and multi-employer plans;
(9) The Senate is concerned about the potential
liabilities facing the PBGC and, as a result, the po-
tential burdens facing healthy pension plans and tax-
payers;
(b) SENSE OF THE SENATE.—It is the sense of the Sen-
ate that the Committee on Finance and the Committee on
Health, Education, Labor and Pensions should conduct
hearings on the status of the multiemployer pension plans,
and should work in consultation with the Departments of
Labor and Treasury on permanent measures to strengthen
the integrity of the private pension system in order to pro-
tect the benefits of current and future pension plan bene-
ficiaries.
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SEC. 9. EXTENSION OF TRANSFERS OF EXCESS PENSION
ASSETS TO RETIREE HEALTH ACCOUNTS.
(a) AMENDMENT OF INTERNAL REVENUE CODE OF
1986.—Paragraph (5) of section 420(b) of the Internal Rev-
enue Code of 1986 (relating to expiration) is amended by
striking ‘‘December 31, 2005’’ and inserting ‘‘December 31,
2013’’.
(b) AMENDMENTS OF ERISA.—
(1) Section 101(e)(3) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1021(e)(3))
is amended by striking ‘‘Tax Relief Extension Act of
1999’’ and inserting ‘‘Pension Stability Act’’.
(2) Section 403(c)(1) of such Act (29 U.S.C.
1103(c)(1)) is amended by striking ‘‘Tax Relief Ex-
tension Act of 1999’’ and inserting ‘‘Pension Stability
Act’’.
(3) Paragraph (13) of section 408(b) of such Act
(29 U.S.C. 1108(b)(3)) is amended—
(A) by striking ‘‘January 1, 2006’’ and in-
serting ‘‘January 1, 2014’’, and
(B) by striking ‘‘Tax Relief Extension Act
of 1999’’ and inserting ‘‘Pension Stability Act’’.
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SEC. 10. CLARIFICATION OF EXEMPTION FROM TAX FOR
SMALL PROPERTY AND CASUALTY INSUR-
ANCE COMPANIES.
(a) IN GENERAL.—Section 501(c)(15)(A) of the Inter-
nal Revenue Code of 1986 is amended to read as follows:
‘‘(A) Insurance companies (as defined in
section 816(a)) other than life (including inter-
insurers and reciprocal underwriters) if—
‘‘(i) the gross receipts for the taxable
year do not exceed $600,000, and
‘‘(ii) more than 50 percent of such
gross receipts consist of premiums.’’.
(b) 
CONTROLLED
GROUP
RULE.—Section
501(c)(15)(C) of the Internal Revenue Code of 1986 is
amended by inserting ‘‘, except that in applying section
1563 for purposes of section 831(b)(2)(B)(ii), subpara-
graphs (B) and (C) of section 1563(b)(2) shall be dis-
regarded’’ before the period at the end.
(c) CONFORMING AMENDMENT.—Clause (i) of section
831(b)(2)(A) of the Internal Revenue Code of 1986 is
amended by striking ‘‘exceed $350,000 but’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2003.
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SEC. 11. DEFINITION OF INSURANCE COMPANY FOR SEC-
TION 831.
(a) IN GENERAL.—Section 831 of the Internal Revenue
Code of 1986 is amended by redesignating subsection (c)
as subsection (d) and by inserting after subsection (b) the
following new subsection:
‘‘(c) INSURANCE COMPANY DEFINED.—For purposes of
this section, the term ‘insurance company’ has the meaning
given to such term by section 816(a)).’’.
(b) EFFECTIVE DATE.—The amendment made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2003.
SEC. 12. FUNDS FOR REBUILDING FISH STOCKS.
Section 105 of the Miscellaneous Appropriations and
Offsets Act, 2004 (division H of the Consolidated appro-
priations Act, 2004) is repealed.
Attest:
Secretary.