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‘‘(i) by treating any reference in this
section to an employer as a reference to all
employers maintaining the plan (or, if ap-
propriate, the plan sponsor), and
‘‘(ii) in accordance with such modi-
fications of this section (and the provisions
of this title and the Employee Retirement
Income Security Act of 1974 relating to this
section) as the Secretary determines appro-
priate to reflect the fact the plan is not
maintained by a single employer.’’
(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 ‘‘American Jobs Creation Act
of 2004’’ and inserting ‘‘Pension Security and Trans-
parency Act of 2005’’.
(2) Section 403(c)(1) of such Act (29 U.S.C.
1103(c)(1)) is amended by striking ‘‘American Jobs
Creation Act of 2004’’ and inserting ‘‘Pension Secu-
rity and Transparency Act of 2005’’.
(3) Section 408(b)(13) of such Act (29 U.S.C.
1108(b)(13)) is amended by striking ‘‘American Jobs
Creation Act of 2004’’ and inserting ‘‘Pension Secu-
rity and Transparency Act of 2005’’.
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(c) EFFECTIVE DATE.—The amendment made by this
section shall apply to transfers made in taxable years begin-
ning after December 31, 2004.
TITLE III—INTEREST RATE
ASSUMPTIONS
SEC. 301. INTEREST RATE ASSUMPTION FOR DETERMINA-
TION OF LUMP SUM DISTRIBUTIONS.
(a) AMENDMENTS OF ERISA.—
(1) IN GENERAL.—Section 205(g)(3)(A) of the
Employee Retirement Income Security Act of 1974
(29 U.S.C. 1055(g)(3)(A)) is amended by adding at
the end the following new sentence: ‘‘In the case of
plan years beginning after 2006, the preceding sen-
tence shall be applied by using the applicable yield
curve method under subparagraph (C) rather than the
applicable interest rate.’’.
(2) APPLICABLE YIELD CURVE METHOD.—Sec-
tion 205(g)(3) of such Act (29 U.S.C. 1055(g)(3)) is
amended by adding at the end the following new sub-
paragraphs:
‘‘(C) APPLICABLE YIELD CURVE METHOD.—
For purposes of subparagraph (A), the term ‘ap-
plicable yield curve method’ means—
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‘‘(i) the phase-in yield curve method in
the case of plan years beginning in 2007,
2008, and 2009, and
‘‘(ii) the yield curve method for years
beginning after 2009.
‘‘(D) YIELD CURVE METHOD.—For purposes
of this paragraph—
‘‘(i) IN
GENERAL.—The yield curve
method is a method under which present
value is determined—
‘‘(I) by using interest rates drawn
from a yield curve which is prescribed
by the Secretary of the Treasury and
which reflects the yield on high-quality
corporate bonds with varying matu-
rities, and
‘‘(II) by matching the timing of
the expected benefit payments under
the plan to the interest rates on such
yield curve.
‘‘(ii) PUBLICATION.—Each month the
Secretary of the Treasury shall publish any
yield curve prescribed under this subpara-
graph which shall apply to plan years be-
ginning in such month and such yield curve
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shall be based on average interest rates for
business days occurring during the 3 pre-
ceding months.
‘‘(E) PHASE-IN YIELD CURVE METHOD.—
‘‘(i) IN GENERAL.—Present value de-
termined under the phase-in yield curve
method shall be equal to the sum of—
‘‘(I) the applicable percentage of
such amount determined under the
yield curve method described in sub-
paragraph (D), and
‘‘(II) the product of such amount
determined by using the applicable in-
terest rate and a percentage equal to
100 percent minus the applicable per-
centage.
‘‘(ii) APPLICABLE PERCENTAGE.—For
purposes of clause (i), the applicable per-
centage is 25 percent for plan years begin-
ning in 2007, 50 percent for plan years be-
ginning in 2008, and 75 percent for plan
years beginning in 2009.’’.
(b) AMENDMENTS OF INTERNAL REVENUE CODE.—
(1) IN GENERAL.—Section 417(e)(3)(A) of the
Internal Revenue Code of 1986 (relating to deter-
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mination of present value) is amended by adding at
the end the following new sentence: ‘‘In the case of
plan years beginning after 2006, the preceding sen-
tence shall be applied by using the applicable yield
curve method under subparagraph (C) rather than the
applicable interest rate.’’
(2) APPLICABLE YIELD CURVE METHOD.—Sec-
tion 417(e) of such Code is amended by adding at the
end the following new subparagraphs:
‘‘(C) APPLICABLE YIELD CURVE METHOD.—
For purposes of subparagraph (A), the term ‘ap-
plicable yield curve method’ means—
‘‘(i) the phase-in yield curve method in
the case of plan years beginning in 2007,
2008, and 2009, and
‘‘(ii) the yield curve method for years
beginning after 2009.
‘‘(D) YIELD CURVE METHOD.—For purposes
of this paragraph—
‘‘(i) IN
GENERAL.—The yield curve
method is a method under which present
value is determined—
‘‘(I) by using interest rates drawn
from a yield curve which is prescribed
by the Secretary and which reflects the
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yield on high-quality corporate bonds
with varying maturities, and
‘‘(II) by matching the timing of
the expected benefit payments under
the plan to the interest rates on such
yield curve.
‘‘(ii) PUBLICATION.—Each month the
Secretary shall publish any yield curve pre-
scribed under this subparagraph which shall
apply to plan years beginning in such
month and such yield curve shall be based
on average interest rates for business days
occurring during the 3 preceding months.
‘‘(E) PHASE-IN YIELD CURVE METHOD.—
‘‘(i) IN GENERAL.—Present value de-
termined under the phase-in yield curve
method shall be equal to the sum of—
‘‘(I) the applicable percentage of
such amount determined under the
yield curve method described in sub-
paragraph (D), and
‘‘(II) the product of such amount
determined by using the applicable in-
terest rate and a percentage equal to
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100 percent minus the applicable per-
centage.
‘‘(ii) APPLICABLE PERCENTAGE.—For
purposes of clause (i), the applicable per-
centage is 25 percent for plan years begin-
ning in 2007, 50 percent for plan years be-
ginning in 2008, and 75 percent for plan
years beginning in 2009.’’.
(c) SPECIAL RULE FOR PLAN AMENDMENTS.—A plan
shall not fail to meet the requirements of section 204(g) of
the Employee Retirement Income Security Act of 1974 or
section 411(d)(6) of the Internal Revenue Code of 1986 sole-
ly by reason of the adoption by the plan of an amendment
necessary to meet the requirements of the amendments made
by this section.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply with respect to plan years beginning
after 2006.
SEC. 302. INTEREST RATE ASSUMPTION FOR APPLYING
BENEFIT LIMITATIONS TO LUMP SUM DIS-
TRIBUTIONS.
(a) IN GENERAL.—Clause (ii) of section 415(b)(2)(E)
of the Internal Revenue Code of 1986 is amended to read
as follows:
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‘‘(ii) For purposes of adjusting any
benefit under subparagraph (B) for any
form of benefit subject to section 417(e)(3),
clause (i) shall be applied by substituting
‘5.5 percent’ for ‘5 percent’.’’.
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to years beginning after December
31, 2005.
SEC. 303. RESTRICTIONS ON FUNDING OF NONQUALIFIED
DEFERRED COMPENSATION PLANS BY EM-
PLOYERS MAINTAINING UNDERFUNDED OR
TERMINATED SINGLE-EMPLOYER PLANS.
(a) AMENDMENTS OF ERISA.—
(1) IN GENERAL.—Part 3 of subtitle A of title I
of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1081 et seq.), as amended by this
Act, is amended by adding at the end the following
new section:
‘‘NOTICE OF FUNDING OF NONQUALIFIED DEFERRED
COMPENSATION PLANS
‘‘SEC. 306. (a) NOTICE AND ACCESS.—
‘‘(1) NOTICE
RELATING
TO
RESTRICTED
PE-
RIOD.—The plan administrator of a defined benefit
plan which is a single-employer plan shall notify each
plan sponsor of the plan within a reasonable period
of time after the occurrence of an event which results
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in a restricted period with respect to the plan. Such
notice shall include information—
‘‘(A) as to the duration of the restricted pe-
riod, and
‘‘(B) 
the 
restrictions 
under 
section
409A(b)(3) of the Internal Revenue Code of 1986
which apply during the restricted period to the
plan sponsor and any member of a controlled
group which includes such sponsor.
‘‘(2) NOTICE OF EXISTENCE OF, AND TRANSFERS
TO, 
NONQUALIFIED
DEFERRED
COMPENSATION
PLANS.—
‘‘(A) INITIAL NOTICE.—Within 30 days of
receipt of a notice under paragraph (1), each
plan sponsor shall notify the plan administrator
of the plan described in paragraph (1)—
‘‘(i) of nonqualified deferred compensa-
tion plans maintained by the plan sponsor
or any member of a controlled group which
includes such sponsor, and
‘‘(ii) the amount of any assets trans-
ferred or otherwise reserved by the plan
sponsor or such member in violation of sec-
tion 409A(b)(3) of such Code during any
portion of the restricted period occurring on
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or before the date the plan sponsor provides
such notice.
‘‘(B) ADDITIONAL
NOTICES.—If, after the
date on which notice is provided under subpara-
graph (A) and during any portion of the re-
maining restricted period specified in the notice
provided under paragraph (1), the plan sponsor
of a plan described in paragraph (1) or a mem-
ber of a controlled group which includes such
sponsor—
‘‘(i) transfers or reserves assets in vio-
lation of section 409A(b)(3) of such Code, or
‘‘(ii) establishes a new nonqualified de-
ferred compensation plan,
the plan sponsor shall notify the plan adminis-
trator of the plan described in paragraph (1) of
such transfer, reservation, or establishment with-
in 3 days of the date of such action.
‘‘(3) ACCESS TO FINANCIAL DATA.—Any fidu-
ciary of the plan shall have access to the financial
records of a plan sponsor or any member of a con-
trolled group which includes such sponsor to deter-
mine if assets were transferred or otherwise reserved
in violation of section 409A(b)(3) of such Code.
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‘‘(4) FORM AND MANNER.—The Secretary may
prescribe the form and manner of a notice required
under this section. Such a notice shall be written in
a manner calculated to be understood by the average
plan participant and may be delivered in written,
electronic, or other appropriate form to the extent
that such form is reasonably accessible to the recipi-
ent.
‘‘(b) RESTRICTED PERIOD.—For purposes of this sec-
tion, the term ‘restricted period’ means, with respect to any
plan described in subsection (a)(1)—
‘‘(1) any period—
‘‘(A) beginning on the first day of a plan
year following a plan year for which the plan’s
adjusted funding target attainment percentage
(as defined in section 303) was less than 60 per-
cent (determined as of the close of such year),
and
‘‘(B) ending on the last day of the first pe-
riod of 2 consecutive plan years (beginning on or
after such first day) for which such percentage
was at least 60 percent,
‘‘(2) any period the plan sponsor is in bank-
ruptcy, and
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‘‘(3) the 12-month period beginning on the date
which is 6 months before the termination date of the
plan if, as of the termination date, the plan is not
sufficient for benefit liabilities (within the meaning of
section 4041).
In the case of a plan which is in at-risk status, paragraph
(1) shall be applied by substituting ‘80 percent’ for ‘60 per-
cent’ each place it appears.
‘‘(c) 
NONQUALIFIED
DEFERRED
COMPENSATION
PLAN.—For purposes of this section—
‘‘(1) IN GENERAL.—The term ‘nonqualified de-
ferred compensation plan’ means any plan that pro-
vides for the deferral of compensation, other than—
‘‘(A) a qualified employer plan, and
‘‘(B) any bona fide vacation leave, sick
leave, compensatory time, disability pay, or
death benefit plan.
‘‘(2) QUALIFIED
EMPLOYER
PLAN.—The term
‘qualified employer plan’ means—
‘‘(A) any plan, contract, pension, account,
or trust described in subparagraph (A) or (B) of
section 219(g)(5) of the Internal Revenue Code of
1986 (without regard to subparagraph (A)(iii)),
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‘‘(B) any eligible deferred compensation
plan (within the meaning of section 457(b)) of
such Code, and
‘‘(C) any plan described in section 415(m)
of such Code.
‘‘(3) PLAN INCLUDES ARRANGEMENTS, ETC.—The
term ‘plan’ includes any agreement or arrangement,
including an agreement or arrangement that includes
one person.
‘‘(d) OTHER DEFINITIONS.—For purposes of this
section—
‘‘(1) APPLICABLE COVERED EMPLOYEE.—
‘‘(A) IN
GENERAL.—The term ‘applicable
covered employee’ means any—
‘‘(i) covered employee of a plan spon-
sor,
‘‘(ii) covered employee of a member of
a controlled group which includes the plan
sponsor, and
‘‘(iii) former employee who was a cov-
ered employee at the time of termination of
employment with the plan sponsor or a
member of a controlled group which in-
cludes the plan sponsor.
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‘‘(B) COVERED EMPLOYEE.—The term ‘cov-
ered employee’ has the meaning given such term
by section 162(m)(3) of the Internal Revenue
Code of 1986.
‘‘(2) CONTROLLED GROUP.—The term ‘controlled
group’ has the meaning given such term by section
302(d)(3).’’.
(2) ENFORCEMENT.—
(A) IN
GENERAL.—Section 502(a) of the
Employee Retirement Income Security Act (29
U.S.C. 1132(a)), as amended by this Act, is
amended—
(i) by striking ‘‘or’’ at the end of para-
graph (9), by striking the period at the end
of paragraph (10) and inserting ‘‘; or’’, and
by adding at the end the following new
paragraph:
‘‘(11) by a fiduciary of a defined benefit plan
which is a single-employer plan against—
‘‘(A) a plan sponsor, a member of a con-
trolled group which includes the plan sponsor,
an applicable covered employee, or a person
holding assets which are part of a nonqualified
deferred compensation plan to recover on behalf
of the plan—
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‘‘(i) assets which were set aside or
transferred 
in 
violation 
of 
section
409A(b)(3) of the Internal Revenue Code of
1986 (and any earnings properly allocable
to the assets); or
‘‘(ii) amounts equivalent to the assets
and earnings described in clause (i); or
‘‘(B) a plan sponsor, or a member of a con-
trolled group which includes the plan sponsor, to
compel the production of records the fiduciary is
entitled to under section 306.’’; and
(ii) by adding at the end the following
new flush sentence:
‘‘For purposes of paragraph (11), any term used in such
paragraph which is also used in section 306 shall have the
meaning given such term by section 306.’’.
(B) AWARDING OF FEES.—Section 502(g) of
such Act (29 U.S.C. 1132(g)) is amended by add-
ing at the end the following new paragraph:
‘‘(3) ACTIONS
TO
RECOVER
ASSETS
TRANS-
FERRED
TO
NONQUALIFIED
DEFERRED
COMPENSA-
TION
PLANS.—If, in any action under subsection
(a)(11) by a fiduciary for or on behalf of a plan to
enforce section 306 of this Act and section 409A(b)(3),
a judgment is awarded in favor of the plan, the court
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may, in addition to any other amount, award the
plan reasonable attorney’s fees and costs of the action,
to be paid by the defendant’’.
(3) CLERICAL AMENDMENT.—The table of con-
tents in section 1 of such Act, as amended by this Act,
is amended by adding at the end the following new
item:
‘‘Sec. 306. Restrictions on funding of nonqualified deferred compensation
plans.’’.
(b) AMENDMENTS OF INTERNAL REVENUE CODE.—
(1) IN GENERAL.—Subsection (b) of section 409A
of the Internal Revenue Code of 1986 (providing rules
relating to funding) is amended by redesignating
paragraphs (3) and (4) as paragraphs (4) and (5),
respectively, and by inserting after paragraph (2) the
following new paragraph:
‘‘(3) EMPLOYERS OF UNDERFUNDED OR TERMI-
NATED DEFINED BENEFIT PLANS.—During any re-
stricted period—
‘‘(A) a plan sponsor of a defined benefit
plan which is a single-employer plan, or
‘‘(B) any member of a controlled group
which includes such sponsor,
shall not directly or indirectly transfer assets, or di-
rectly or indirectly otherwise reserve assets, in a trust
(or other arrangement determined by the Secretary)
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for purposes of paying deferred compensation of an
applicable covered employee under a nonqualified de-
ferred compensation plan of the plan sponsor or mem-
ber. Any assets transferred or reserved in violation of
the preceding sentence shall, for purposes of section
83, be treated as property transferred in connection
with the performance of services whether or not such
assets are available to satisfy claims of general credi-
tors. For purposes of this paragraph, any term used
in this paragraph which is also used in section 306
of the Employee Retirement Income Security Act of
1974 shall have the meaning given such term by such
section.’’.
(2) 
CONFORMING
AMENDMENTS.—Paragraphs
(4) and (5) of section 409A(b) of such Code, as redes-
ignated by subsection (a) of this subsection, are each
amended by striking ‘‘paragraph (1) or (2)’’ each
place it appears and inserting ‘‘paragraph (1), (2), or
(3)’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to transfers or other reservation of assets
after December 31, 2006.
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SEC. 304. MODIFICATION OF PENSION FUNDING REQUIRE-
MENTS FOR PLANS SUBJECT TO CURRENT
TRANSITION RULE.
(a) PLAN YEAR BEFORE NEW FUNDING RULES.—Sec-
tion 769(c)(3) of the Retirement Protection Act of 1994, as
added by section 201 of the Pension Funding Equity Act
of 2004, is amended by striking ‘‘and 2005’’ and inserting
‘‘, 2005, and 2006’’.
(b) PLAN YEARS AFTER NEW FUNDING RULES.—
(1) IN GENERAL.—In the case of a plan that—
(A) was not required to pay a variable rate
premium for the plan year beginning in 1996,
(B) has not, in any plan year beginning
after 1995, merged with another plan (other than
a plan sponsored by an employer that was in
1996 within the controlled group of the plan
sponsor), and
(C) is sponsored by a company that is en-
gaged primarily in the interurban or interstate
passenger bus service,
the rules described in subsection (b) shall apply for
any plan year beginning after 2006.
(2) MODIFIED RULES.—The rules described in
this subsection are as follows:
(A) For purposes of—
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(i) 
determining 
unfunded 
benefits
under section 4006(a)(3)(E)(ii) of the Em-
ployee Retirement Income Security Act of
1974, and
(ii) determining any present value or
making any computation under section 412
and section 430 of the Internal Revenue
Code of 1986 and sections 302 and 303 of
such Act,
the mortality table shall be the mortality table used
by the plan.
(B) Notwithstanding section 303(f)(4) of
such Act or 430(f)(4) of such Code, for purposes
of section 303(c)(4)(A)(ii) of such Act and
430(c)(4)(A)(ii) of such Code, the value of plan
assets shall not be reduced by the amount of the
prefunding balance if, pursuant to a binding
written agreement with the Pension Benefit
Guaranty Corporation entered into before Janu-
ary 1, 2006, the prefunding balance is not avail-
able to reduce the minimum required contribu-
tion for the plan year.
(3) DEFINITIONS.—Any term used in this section
which is also used in section 303 of such Act or sec-
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tion 430 of such Code shall have the meaning pro-
vided such term in such section.
(4) CONFORMING AMENDMENT.—Section 769 of
the Retirement Protection Act of 1994 is amended by
striking subsection (c).
(5) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to plan years beginning
after 2006.
TITLE IV—IMPROVEMENTS IN
PBGC GUARANTEE PROVISIONS
SEC. 401. INCREASES IN PBGC PREMIUMS.
(a) FLAT-RATE PREMIUMS.—
(1) IN
GENERAL.—Section 4006(a)(3)(A)(i) of
the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1306(a)(3)(A)(i)) is amended to read
as follows:
‘‘(i) in the case of a single-employer
plan, an amount equal to—
‘‘(I) for plan years beginning
after December 31, 1990, and before
January 1, 2006, $19, or
‘‘(II) for plan years beginning
after December 31, 2005, the amount
determined under subparagraph (H),
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plus the additional premium (if any) deter-
mined under subparagraph (E) for each in-
dividual who is a participant in such plan
during the plan year;’’.
(2) AMOUNT OF PREMIUM AFTER 2005.—Section
4006(a)(3) of such Act (29 U.S.C. 1306(a)(3)), as
amended by sections 406 and 407, is amended by
adding at the end the following:
‘‘(H) AMOUNT OF PREMIUM.—
‘‘(i) IN GENERAL.—The amount deter-
mined under this subparagraph is the great-
er of $30 or in the case of plan years begin-
ning after December 31, 2006, the adjusted
amount determined under clause (ii).
‘‘(ii) ADJUSTED
AMOUNT.—The ad-
justed amount determined under this clause
is the product derived by multiplying $30
by the ratio of—
‘‘(I) the contribution and benefit
base (determined under section 230 of
the Social Security Act) in effect in the
calendar year in which the plan year
begins, to
‘‘(II) the contribution and benefit
base in effect in 2006.
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‘‘(iii) ROUNDING.—If the amount de-
termined under clause (ii) is not a multiple
of $1, such product shall be rounded to the
nearest multiple of $1.’’.
(b) RISK-BASED PREMIUMS.—
(1) CONFORMING
AMENDMENTS
RELATED
TO
FUNDING RULES FOR SINGLE-EMPLOYER PLANS.—Sec-
tion 4006(a)(3)(E) of such Act is amended by striking
clauses (iii) and (iv) and inserting the following:
‘‘(iii)(I) For purposes of clause (ii), except as provided
in subclause (II), the term ‘unfunded benefits’ means, for
a plan year, the amount which would be the plan’s funding
shortfall (as defined in section 303(c)(4)) if the value of
plan assets of the plan were equal to the fair market value
of such assets.
‘‘(II) The interest rate used in valuing benefits for pur-
poses of subclause (I) shall be equal to the first, second, or
third segment rate which would be determined under section
303(h)(2)(C) if section 303(h)(2)(D) were applied by using
the yields on investment grade corporate bonds with vary-
ing maturities rather than the average of such yields for
a 12-month period.’’.
(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall apply with respect to plan
years beginning after 2006.
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(c) FLAT-RATE PREMIUM ADJUSTMENT.—
(1) IN GENERAL.—Beginning in 2011, and every
5 years thereafter, the Board of Directors of the Pen-
sion Benefit Guaranty Corporation under title IV of
the Employee Retirement Income Security Act (29
U.S.C. 1301 et seq.) shall submit to Congress a report
that describes any recommendations for adjusting the
premium rate payable to the Corporation described
under section 4006(a)(3)(A)(i) of such Act (as amend-
ed by subsection (a)).
(2) CONSIDERATIONS.—In developing the report
described under paragraph (1), the Corporation shall
consider—
(A) the national average wage index (as de-
fined in section 209(k)(1) of the Social Security
Act (42 U.S.C. 409(k)(1)));
(B) the finances of the Corporation as of the
date of such report and an actuarial evaluation
of the expected operations and status of the funds
established under section 4005 of such title IV
(29 U.S.C. 1305) for the 5 years succeeding such
date;
(C) the impact of any increases in such pre-
mium rate on plan sponsors subject to such title
IV; and
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(D) such other factors determined relevant
by the Corporation.
SEC. 402. AUTHORITY TO ENTER ALTERNATIVE FUNDING
AGREEMENTS TO PREVENT PLAN TERMI-
NATIONS.
(a) AUTHORITY TO ENTER INTO AGREEMENTS.—
(1) DISTRESS TERMINATIONS.—Section 4041(c)
of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1341(c)) is amended by adding at
the end the following:
‘‘(4) ALTERNATIVE FUNDING AGREEMENTS.—
‘‘(A) IN GENERAL.—If the corporation de-
termines that—
‘‘(i) a plan meets the requirements for
a distress termination under this subsection
without regard to an alternative funding
agreement under section 4047(a), and
‘‘(ii) the termination of the plan would
not be necessary if such an agreement were
entered into,
the corporation may request that the Secretary of
the Treasury, in consultation with the corpora-
tion, enter into such an agreement with the con-
tributing sponsors under the plan.
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‘‘(B) EARLY ACTION INITIATIVES.—Subject
to the limitations in subsection (a)(3), if—
‘‘(i) the corporation determines that it
is reasonable to believe that a plan may be
subject to a distress termination within 6
months unless action is taken, the corpora-
tion may request that the Secretary of the
Treasury, in consultation with the corpora-
tion, enter into an alternative funding
agreement under section 4047(a); and
‘‘(ii) the corporation, upon the request
of the contributing sponsor of a plan or
other person, determines that it is reason-
able to believe that a plan may be subject
to a distress termination within 2 years un-
less action is taken, the corporation may re-
quest that the Secretary of the Treasury, in
consultation with the corporation, enter into
an alternative funding agreement under sec-
tion 4047(a).’’.
(2) INVOLUNTARY TERMINATIONS.—Section 4042
of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1342) is amended by adding at the
end the following:
‘‘(i) ALTERNATIVE FUNDING AGREEMENTS.—If—
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‘‘(1) the corporation determines that it is reason-
able to believe that a plan will meet the requirements
for an involuntary termination under this section
without regard to an alternative funding agreement
under section 4047(a) within 6 months unless action
is taken, or
‘‘(B) the corporation, upon the request of the
contributing sponsor of a plan or other person, deter-
mines that it is reasonable to believe that a plan may
be subject to an involuntary termination within 2
years unless action is taken,
and such a termination would not be necessary if such an
agreement is entered into, the corporation may request that
the Secretary of the Treasury, in consultation with the cor-
poration, enter into an alternative funding agreement
under section 4047(a).’’.
(b) ALTERNATIVE FUNDING SCHEDULES TO PREVENT
PLAN TERMINATION.—
(1) IN GENERAL.—Section 4047 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1347) is amended by—
(A) striking the section heading and all that
follows through ‘‘Whenever’’ and inserting—
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‘‘SEC. 4047. ALTERNATIVE FUNDING SCHEDULES TO PRE-
VENT TERMINATION; RESTORATION OF TER-
MINATED PLANS.
‘‘(a) ALTERNATIVE FUNDING AGREEMENTS.—
‘‘(1) IN GENERAL.—If the requirements of section
4041(c)(4) or 4042(i) are met with respect to any
plan, the Secretary of the Treasury, in consultation
with the corporation, may enter into an alternative
funding agreement with the contributing sponsors
under the plan that meets the requirements of this
subsection.
‘‘(2) OTHER
REQUIREMENTS.—An alternative
funding agreement may be entered into by the Sec-
retary of the Treasury, in consultation with corpora-
tion, only if—
‘‘(A) such Secretary finds the agreement to
be in the best interests of the participants and
beneficiaries; and
‘‘(B) the agreement meets the requirements
set forth by such Secretary in regulations.
‘‘(3) ALTERNATIVE FUNDING AGREEMENT.—
‘‘(A) IN GENERAL.—An agreement meets the
requirements 
of 
this 
subsection 
if 
the
agreement—
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‘‘(i) provides for an additional amorti-
zation schedule for a period not to exceed 10
years,
‘‘(ii) requires the plan to pay at the
time the agreement is entered into any pro-
fessional fees or other expenses incurred by
the Secretary of the Treasury or the cor-
poration in connection with the agreements,
‘‘(iii) requires approval by the cor-
poration before the contributing sponsor es-
tablishes or maintains any other defined
benefit plan other than any multiemployer
plan that covers a substantial number of
employees who are covered by the plan sub-
ject to the agreement or who perform sub-
stantially the same type of work with re-
spect to the same business operations as em-
ployees covered by such plan, and
‘‘(iv) provides for a termination date,
or a schedule of termination dates, for the
purpose of the guarantee under section
4022, to apply if a plan terminates during
the period that the agreement is in effect.
‘‘(B) 
OTHER
CONDITIONS.—Notwith-
standing any other provision of this Act, an
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agreement meeting the requirements of this sub-
section may provide—
‘‘(i) for restrictions on, or the elimi-
nation of, future accruals, but only to the
extent that such restrictions or eliminations
would have been permitted under section
204(g) or section 411(d)(6) of the Internal
Revenue Code of 1986 if they had been im-
plemented by a plan amendment adopted
immediately before the effective date of the
agreement,
‘‘(ii) that the contributing sponsors
will provide security or other collateral in
such form and amount as specified in the
agreement,
‘‘(iii) conditions under which the plan
could be terminated in a standard termi-
nation under section 4041(b) or conditions
under which accruals to which clause (i)
applies could resume in the future, and
‘‘(iv) for such other terms and condi-
tions as the Secretary of the Treasury, in
consultation with the corporation, deter-
mines necessary to protect the interests of
the corporation.
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‘‘(C) EMPLOYEE REQUIREMENTS.—
‘‘(i) 
IN
GENERAL.—An 
agreement
meets the requirements of this subsection
only if—
‘‘(I) at least 60 days before the
agreement is to take effect the contrib-
uting sponsors notify affected parties
(other than the corporation) of the
terms of the agreement and its effect on
such parties, and
‘‘(II) each employee organization
representing participants in the plan
approves the agreement before it takes
effect.
‘‘(ii) FORM AND MANNER OF NOTICE.—
The notice under clause (i) shall be written
in a manner calculated to be understood by
the average plan participant and may be
provided to a person designated, in writing,
by the person to which it would otherwise be
provided. Such notice may be provided in
written, electronic, or other appropriate
form to the extent such form is reasonably
accessible to persons to whom the notice is
required to be provided.
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‘‘(4) COORDINATION
WITH
MINIMUM
FUNDING
REQUIREMENTS.—Any alternative funding schedule
under an agreement meeting the requirements under
this subsection shall supersede the minimum funding
requirements of this Act and the Internal Revenue
Code of 1986. For purposes of applying this Act or
such Code, any contribution required under such
schedule shall be treated in the same manner as con-
tributions required under section 302 of this Act and
section 412 of such Code.
‘‘(b) RESTORATION OF TERMINATED PLANS.—When-
ever’’.
(2) CONFORMING
AMENDMENT.—The table of
contents for title IV of such Act is amended by strik-
ing the item relating to section 4047 and inserting
the following:
‘‘4047. Alternative funding schedules to prevent terminations; restoration of
terminated plans.’’.
(c) AMENDMENTS TO OTHER PROVISIONS.—
(1) 
QUALIFICATION
REQUIREMENT.—Section
401(a) of the Internal Revenue Code of 1986, as
amended by sections 115 and 701 of this Act, is
amended by inserting after paragraph (35) the fol-
lowing new paragraph:
‘‘(36) SUCCESSOR PLANS TO CERTAIN PLANS.—
If—
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‘‘(A) an alternative funding agreement de-
scribed in section 4047(a) of the Employee Re-
tirement Income Security Act of 1974 is in effect
with respect to any plan, and
‘‘(B) the plan is maintained by an em-
ployer that establishes or maintains 1 or more
other defined benefit plans (other than any mul-
tiemployer plan), and such other plans in com-
bination provide benefit accruals to any substan-
tial number of successor employees,
the Secretary may, in the Secretary’s discretion, de-
termine that any trust of which any other such plan
is a part does not constitute a qualified trust under
this subsection unless all benefit obligations of the
plan to which the alternative funding agreement ap-
plies have been satisfied. For purposes of this para-
graph, the term ‘successor employee’ means any em-
ployee who is or was covered by the plan to which the
alternative funding agreement applies and any em-
ployee who performs substantially the same type of
work with respect to the same business operations as
an employee covered by such plan.’’.
(2) LIMITATION ON DEDUCTIONS UNDER CERTAIN
PLANS.—Section 404(a)(7)(C) of the Internal Revenue
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Code of 1986 is amended by adding at the end the fol-
lowing:
‘‘(iii) PLANS
SUBJECT
TO
ALTER-
NATIVE
FUNDING
AGREEMENTS.—This
paragraph shall not apply to any plan for
a plan year if an alternative funding agree-
ment described in section 4047(a) of the
Employee Retirement Income Security Act
of 1974 is in effect for such year.’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall take effect on the date of enactment of this Act.
SEC. 403. SPECIAL FUNDING RULES FOR PLANS MAIN-
TAINED BY COMMERCIAL AIRLINES THAT ARE
AMENDED TO CEASE FUTURE BENEFIT AC-
CRUALS.
(a) IN GENERAL.—If an election is made to have this
section apply to an eligible plan—
(1) in the case of any applicable plan year be-
ginning before January 1, 2007, the plan shall not
have an accumulated funding deficiency for purposes
of section 302 of the Employee Retirement Income Se-
curity Act of 1974 and sections 412 and 4971 of the
Internal Revenue Code of 1986 if contributions to the
plan for the plan year are not less than the minimum
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required contribution determined under subsection (d)
for the plan for the plan year, and
(2) in the case of any applicable plan year be-
ginning on or after January 1, 2007, the minimum
required contribution determined under sections 303
of such Act and 430 of such Code shall, for purposes
of sections 302 and 303 of such Act and sections 412,
430, and 4971 of such Code, be equal to the minimum
required contribution determined under subsection (d)
for the plan for the plan year.
(b) ELIGIBLE PLAN.—For purposes of this section—
(1) IN
GENERAL.—The term ‘‘eligible plan’’
means a defined benefit plan (other than a multiem-
ployer plan) to which sections 302 of such Act and
412 of such Code applies—
(A) which is sponsored by an employer—
(i) which is a commercial airline pas-
senger airline, or
(ii) the principal business of which is
providing catering services to a commercial
passenger airline, and
(B) with respect to which the requirements
of paragraphs (2) and (3) are met.
(2) ACCRUAL RESTRICTIONS.—
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(A) IN GENERAL.—The requirements of this
paragraph are met if, effective as of the first day
of the first applicable plan year and at all times
thereafter while an election under this section is
in effect, the plan provides that—
(i) the accrued benefit, any death or
disability benefit, and any social security
supplement described in the last sentence of
section 411(a)(9) of such Code and section
204(b)(1)(G) of such Act, of each partici-
pant are frozen at the amount of such ben-
efit or supplement immediately before such
first day, and
(ii) all other benefits under the plan
are eliminated,
but only to the extent the freezing or elimination
of such benefits would have been permitted under
section 411(d)(6) of such Code and section 204(g)
of such Act if they had been implemented by a
plan amendment adopted immediately before
such first day.
(B) INCREASES IN SECTION 415 LIMITS DIS-
REGARDED.—If a plan provides that an accrued
benefit of a participant which has been subject to
any limitation under section 415 of such Code
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will be increased if such limitation is increased,
the plan shall not be treated as meeting the re-
quirements of this paragraph unless, effective as
of the first day of the first applicable plan year
and at all times thereafter while an election
under this section is in effect, the plan provides
that any such increase shall not take effect. A
plan shall not fail to meet the requirements of
section 411(d)(6) of such Code and section 204(g)
of such Act solely because the plan is amended
to meet the requirements of this subparagraph.
(3) RESTRICTION ON APPLICABLE BENEFIT IN-
CREASES.—
(A) IN GENERAL.—The requirements of this
paragraph are met if no applicable benefit in-
crease takes effect at any time during the period
beginning on July 26, 2005, and ending on the
day before the first day of the first applicable
plan year.
(B) APPLICABLE BENEFIT INCREASE.—For
purposes of this paragraph, the term ‘‘applicable
benefit increase’’ means, with respect to any
plan year, any increase in liabilities of the plan
by plan amendment (or otherwise provided in
regulations provided by the Secretary) which,
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but for this paragraph, would occur during the
plan year by reason of—
(i) any increase in benefits,
(ii) any change in the accrual of bene-
fits, or
(iii) any change in the rate at which
benefits become nonforfeitable under the
plan.
(4) EXCEPTION FOR IMPUTED DISABILITY SERV-
ICE.—Paragraphs (2) and (3) shall not apply to any
accrual or increase with respect to imputed service
provided to a participant during any period of the
participant’s disability occurring on or after the effec-
tive date of the plan amendment providing the re-
strictions under paragraph (2) if the participant—
(A) was receiving disability benefits as of
such date, or
(B) was receiving sick pay and subsequently
determined to be eligible for disability benefits as
of such date.
(c) ELECTIONS AND RELATED TERMS.—
(1) IN GENERAL.—A plan sponsor shall make the
election under subsection (a) at such time and in such
manner as the Secretary of the Treasury may pre-
scribe. Except as provided in subsection (h)(5), such
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election, once made, may be revoked only with the
consent of such Secretary.
(2) YEARS FOR WHICH ELECTION MADE.—
(A) IN GENERAL.—The plan sponsor may
select the first plan year to which the election
under subsection (a) applies from among plan
years ending after the date of the election. The
election shall apply to such plan year and all
subsequent years.
(B) ELECTION OF NEW PLAN YEAR.—The
plan sponsor may specify a new plan year in the
election under subsection (a) and the plan year
of the plan may be changed to such new plan
year without the approval of the Secretary of the
Treasury.
(3) APPLICABLE PLAN YEAR.—The term ‘‘appli-
cable plan year’’ means each plan year to which the
election under subsection (a) applies under paragraph
(1).
(d) MINIMUM REQUIRED CONTRIBUTION.—
(1) IN GENERAL.—In the case of any applicable
plan year during the amortization period, the min-
imum required contribution shall be the amount nec-
essary to amortize the unfunded liability of the plan,
determined as of the first day of the plan year, in
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equal annual installments (until fully amortized) over
the remainder of the amortization period. Such
amount shall be separately determined for each appli-
cable plan year.
(2) YEARS AFTER AMORTIZATION PERIOD.—In
the case of any plan year beginning after the end of
the amortization period, section 302(a)(2)(A) of such
Act and section 412(a)(2)(A) of such Code shall apply
to such plan, but the prefunding balance as of the
first day of the first of such years under section 303(f)
of such Act and section 430(f) of such Code shall be
zero.
(3) 
DEFINITIONS.—For 
purposes 
of 
this
section—
(A) UNFUNDED LIABILITY.—The term ‘‘un-
funded liability’’ means the unfunded accrued li-
ability under the plan, determined under the
unit credit funding method.
(B) AMORTIZATION
PERIOD.—The term
‘‘amortization period’’ means the 20-plan year
period beginning with the first applicable plan
year.
(4) OTHER RULES.—In determining the min-
imum 
required 
contribution 
and 
amortization
amount under this subsection—
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(A) the provisions of section 302(c)(3) of
such Act and section 412(c)(3) of such Code, as
in effect before the date of enactment of this sec-
tion, shall apply,
(B) the rate of interest under section 302(b)
of such Act and section 412(b) of such Code, as
so in effect, shall be used for all calculations re-
quiring an interest rate, and
(C) the value of plan assets shall be equal
to their fair market value.
(5) SPECIAL
RULE
FOR
CERTAIN
PLAN
SPIN-
OFFS.—For purposes of subsection (a), if, with respect
to any eligible plan to which this subsection applies—
(A) any applicable plan year includes the
date of the enactment of this Act,
(B) a plan was spun off from the eligible
plan during the plan year but before such date
of enactment,
the minimum required contribution under subsection
(a)(1) for the eligible plan for such applicable plan
year shall be determined as if the plans were a single
plan for that plan year (based on the full 12-month
plan year in effect prior to the spin-off). The em-
ployer shall designate the allocation of the minimum
required contribution between such plans for the ap-
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plicable plan year and direct the appropriate re-
allocation between the plans of any contributions for
the applicable plan year.
(e) FUNDING STANDARD ACCOUNT AND PREFUNDING
BALANCE.—Any charge or credit in the funding standard
account under section 302 of such Act or section 412 of such
Code, and any prefunding balance under section 303 of such
Act or section 430 of such Code, as of the day before the
first day of the first applicable plan year, shall be reduced
to zero.
(f) AMENDMENTS TO OTHER PROVISIONS.—
(1) 
QUALIFICATION
REQUIREMENT.—Section
401(a)(36) of the Internal Revenue Code of 1986, as
added by section 402 of this Act, is amended by add-
ing at the end the following: ‘‘This paragraph shall
also apply to any plan during any period during
which an amortization schedule under section 403 of
the Pension Security and Transparency Act of 2005
is in effect.’’
(2) PBGC LIABILITY LIMITED.—Section 4022 of
the Employee Retirement Income Security Act of
1974, as amended by this Act, is amended by adding
at the end the following new subsection:
‘‘(h) SPECIAL RULE FOR PLANS ELECTING CERTAIN
FUNDING REQUIREMENTS.—During any period in which
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an election by a plan under section 403 of the Pension Secu-
rity and Transparency Act of 2005 is in effect, then this
section and section 4044(a)(3) shall be applied by treating
the first day of the first applicable plan year as the termi-
nation date of the plan. This subsection shall not apply to
any plan for which an election under section 403(h) of such
Act is in effect.’’.
(3) LIMITATION ON DEDUCTIONS UNDER CERTAIN
PLANS.—Section 404(a)(7)(C)(iii) of the Internal
Revenue Code of 1986, as added by this Act, is
amended by adding at the end the following new sen-
tence: ‘‘This clause shall also apply to any plan for
a plan year if an election under section 403 of the
Pension Security and Transparency Act of 2005 is in
effect for such year.’’
(4) NOTICE.—In the case of a plan amendment
adopted in order to comply with this section, any no-
tice required under section 204(h) of such Act or sec-
tion 4980F(e) of such Code shall be provided within
15 days of the effective date of such plan amendment.
This subsection shall not apply to any plan unless
such plan is maintained pursuant to one or more col-
lective bargaining agreements between employee rep-
resentatives and 1 or more employers.
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(g) SPECIAL RULES FOR TERMINATION OF ELIGIBLE
PLANS.—During any period an election is in effect under
this section with respect to an eligible plan, the Pension
Benefit Guaranty Corporation shall, before it seeks or ap-
proves a termination of such plan under section 4041(c)
or 4042 of the Employee Retirement Income Security Act
of 1974—
(1) 
make 
a 
determination 
under 
section
4041(c)(4) or 4042(i) of such Act whether the termi-
nation would be necessary if the Secretary of the
Treasury were to enter into an agreement under sec-
tion 4047(a) of such Act which provides an alter-
native funding agreement to replace the amortization
schedule under this section, and
(2) if the Corporation determines such an agree-
ment would make such termination unnecessary, take
all necessary actions to ensure the agreement is en-
tered into.
The Pension Benefit Guaranty Corporation shall make the
determination under paragraph (1) within 90 days of re-
ceiving all information needed in connection with a request
for a termination (or if no such request is made, within
90 days of consideration of the termination by the Corpora-
tion).
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(h) CERTAIN BENEFIT ACCRUALS AND INCREASES AL-
LOWED IF ADDITIONAL CONTRIBUTIONS MADE TO COVER
COSTS.—
(1) IN GENERAL.—If an employer elects the ap-
plication of this subsection—
(A) the requirements of paragraphs (2) and
(3) of subsection (b) shall not apply with respect
to any eligible plan maintained by the employer
and specified in the election, and
(B) the minimum required contribution
under subsection (d) for any plan year with re-
spect to the plan shall be increased by the
amounts described in paragraphs (2) and (3).
Any liabilities and assets taken into account under
this subsection shall not be taken into account in de-
termining the unfunded liability of the plan for pur-
poses of subsection (d).
(2) CURRENT FUNDING OF ACCRUALS AND IN-
CREASES.—The amount determined under this para-
graph for any plan year is the target normal cost
which would occur under section 303(b) of such Act
and 430(b) of such Code if—
(A) any benefit accrual, or benefit increase
taking effect, during the plan year by reason of
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this subsection were treated as having been ac-
crued or earned during the plan year, and
(B) the plan were treated as if it were in
at-risk status.
(3) 
FUNDING
MUST
BE
MAINTAINED.—The
amount determined under this paragraph for any
plan year is the amount of any increase in the short-
fall amortization charge which would occur under sec-
tion 303(c) of such Act and 430(c) of such Code if—
(A) the funding target were determined by
only taking into account benefits to which para-
graph (2) applied for preceding plan years,
(B) the only assets taken into account were
the contributions required under this paragraph
and paragraph (2) for preceding plan years
(and any earnings thereon),
(C) the amortization period included only
the plan year,
(D) the transition rule under section
303(c)(4)(B) 
of 
such 
Act 
and 
section
430(c)(4)(B) of such Code did not apply, and
(E) the plan were treated as if it were in
at-risk status.
(4) SPECIAL RULES FOR YEARS BEFORE 2007.—
Notwithstanding any other provision of this Act, in
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the case of an applicable plan year of an eligible plan
to which this subsection applies which begins before
January 1, 2007, in determining the amounts de-
scribed in paragraphs (2) and (3) for such plan
year—
(A) the provisions of, and amendments
made by, sections 101, 102, 111, and 112 shall
apply to such plan year, except that
(B) the interest rate used under section 303
of such Act and section 430 of such Code for pur-
poses of applying paragraphs (2) and (3) to such
plan year shall be the interest rate determined
under section 302(b)(5) of such Act and section
412(b)(5) of such Code, as in effect for plan
years beginning in 2005.
(5) ELECTION OUT OF SECTION.—An employer
maintaining an eligible plan to which this subsection
applies may make a one-time election with respect to
any applicable plan year not to have this section
apply to such plan year and all subsequent plan
years. Subject to subsection (d)(2), the minimum re-
quired contribution under section 303 of such Act and
430 of such Code for all such plan years shall be de-
termined without regard to this section.
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(i) EXCLUSION OF CERTAIN EMPLOYEES FROM MIN-
IMUM COVERAGE REQUIREMENTS.—
(1) IN
GENERAL.—Section 410(b)(3) of such
Code is amended by striking the last sentence and in-
serting the following: ‘‘For purposes of subparagraph
(B), management pilots who are not represented in
accordance with title II of the Railway Labor Act
shall be treated as covered by a collective bargaining
agreement described in such subparagraph if the
management pilots manage the flight operations of
air pilots who are so represented and the management
pilots are, pursuant to the terms of the agreement, in-
cluded in the group of employees benefitting under the
trust described in such subparagraph. Subparagraph
(B) shall not apply in the case of a plan which pro-
vides contributions or benefits for employees whose
principal duties are not customarily performed
aboard an aircraft in flight (other than management
pilots described in the preceding sentence).’’
(2) EFFECTIVE DATE.—The amendment made by
this subsection shall apply to years beginning before,
on, or after the date of the enactment of this Act.
(j) EFFECTIVE DATE.—Except as otherwise provided
in this section, the amendments made by this section shall
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apply to plan years ending after the date of the enactment
of this Act.
SEC. 404. LIMITATION ON PBGC GUARANTEE OF SHUTDOWN
AND OTHER BENEFITS.
(a) IN GENERAL.—Section 4022(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1322(b)) is amended by adding at the end the following:
‘‘(8) If a benefit is payable by reason of—
‘‘(A) a plant shutdown or similar event; or
‘‘(B) any event other than attainment of
any age, performance of any service, receipt or
derivation of any compensation, or the occur-
rence of death or disability,
this section shall be applied as if a plan amendment
had been adopted on the date such event occurred that
provides for the payment of such benefit.’’.
(b) EFFECTIVE DATE.—The amendment made by this
section shall apply to benefits that become payable as a re-
sult of a plant shutdown or other similar event, as such
terms are used in the amendment made by subsection (a),
that occurs after July 26, 2005.
SEC. 405. RULES RELATING TO BANKRUPTCY OF EM-
PLOYER.
(a) GUARANTEE.—Section 4022 of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 1322),
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as amended by this Act, is amended by adding at the end
the following:
‘‘(i) BANKRUPTCY FILING SUBSTITUTED FOR TERMI-
NATION DATE.—If a contributing sponsor of a plan has
filed or has had filed against such person a petition seeking
liquidation or reorganization in a case under title 11,
United States Code, or under any similar Federal law or
law of a State or political subdivision, and the case has
not been dismissed as of the termination date, then this sec-
tion shall be applied by treating the date such petition was
filed as the termination date of the plan.’’.
(b) ALLOCATION OF ASSETS AMONG PRIORITY GROUPS
IN BANKRUPTCY PROCEEDINGS.—Section 4044 of the Em-
ployee Retirement Income Security Act of 1974 (29 U.S.C.
1344) is amended by adding at the end the following:
‘‘(e) BANKRUPTCY FILING SUBSTITUTED FOR TERMI-
NATION DATE.—If a contributing sponsor of a plan has
filed or has had filed against such person a petition seeking
liquidation or reorganization in a case under title 11,
United States Code, or under any similar Federal law or
law of a State or political subdivision, and the case has
not been dismissed as of the termination date, then sub-
section (a)(3) shall be applied by treating the date such pe-
tition was filed as the termination date of the plan.’’.
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(c) EFFECTIVE DATE.—The amendments made this
section shall apply with respect to proceedings initiated
under title 11, United States Code, or under any similar
Federal law or law of a State or political subdivision, on
or after the date that is 30 days after the date of enactment
of this Act.
SEC. 406. PBGC PREMIUMS FOR NEW PLANS OF SMALL EM-
PLOYERS.
(a) IN
GENERAL.—Subparagraph (A) of section
4006(a)(3) of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1306(a)(3)(A)) is amended—
(1) in clause (i), by inserting ‘‘other than a new
single-employer plan (as defined in subparagraph
(F)) maintained by a small employer (as so de-
fined),’’ after ‘‘single-employer plan,’’,
(2) in clause (iii), by striking the period at the
end and inserting ‘‘, and’’, and
(3) by adding at the end the following new
clause:
‘‘(v) in the case of a new single-employer plan
(as defined in subparagraph (F)) maintained by a
small employer (as so defined) for the plan year, $5
for each individual who is a participant in such plan
during the plan year.’’
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(b) DEFINITION OF NEW SINGLE-EMPLOYER PLAN.—
Section 4006(a)(3) of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1306(a)(3)) is amended by
adding at the end the following new subparagraph:
‘‘(F)(i) For purposes of this paragraph, a single-em-
ployer plan maintained by a contributing sponsor shall be
treated as a new single-employer plan for each of its first
5 plan years if, during the 36-month period ending on the
date of the adoption of such plan, the sponsor or any mem-
ber of such sponsor’s controlled group (or any predecessor
of either) did not establish or maintain a plan to which
this title applies with respect to which benefits were accrued
for substantially the same employees as are in the new sin-
gle-employer plan.
‘‘(ii)(I) For purposes of this paragraph, the term
‘small employer’ means an employer which on the first day
of any plan year has, in aggregation with all members of
the controlled group of such employer, 100 or fewer employ-
ees.
‘‘(II) In the case of a plan maintained by two or more
contributing sponsors that are not part of the same con-
trolled group, the employees of all contributing sponsors and
controlled groups of such sponsors shall be aggregated for
purposes of determining whether any contributing sponsor
is a small employer.’’
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(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to plans first effective after December
31, 2005.
SEC. 407. PBGC PREMIUMS FOR SMALL AND NEW PLANS.
(a) NEW
PLANS.—Subparagraph (E) of section
4006(a)(3) of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1306(a)(3)), as amended by this
Act, is amended by adding at the end the following new
clause:
‘‘(iv) In the case of a new defined benefit plan, the
amount determined under clause (ii) for any plan year
shall be an amount equal to the product of the amount de-
termined under clause (ii) and the applicable percentage.
For purposes of this clause, the term ‘applicable percentage’
means—
‘‘(I) 0 percent, for the first plan year.
‘‘(II) 20 percent, for the second plan year.
‘‘(III) 40 percent, for the third plan year.
‘‘(IV) 60 percent, for the fourth plan year.
‘‘(V) 80 percent, for the fifth plan year.
For purposes of this clause, a defined benefit plan (as de-
fined in section 3(35)) maintained by a contributing spon-
sor shall be treated as a new defined benefit plan for each
of its first 5 plan years if, during the 36-month period end-
ing on the date of the adoption of the plan, the sponsor
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and each member of any controlled group including the
sponsor (or any predecessor of either) did not establish or
maintain a plan to which this title applies with respect
to which benefits were accrued for substantially the same
employees as are in the new plan.’’
(b) SMALL PLANS.—Paragraph (3) of section 4006(a)
of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1306(a)), is amended—
(1) by striking ‘‘The’’ in subparagraph (E)(i)
and inserting ‘‘Except as provided in subparagraph
(G), the’’, and
(2) by inserting after subparagraph (F) the fol-
lowing new subparagraph:
‘‘(G)(i) In the case of an employer who has 25 or fewer
employees on the first day of the plan year, the additional
premium determined under subparagraph (E) for each par-
ticipant shall not exceed $5 multiplied by the number of
participants in the plan as of the close of the preceding plan
year.
‘‘(ii) For purposes of clause (i), whether an employer
has 25 or fewer employees on the first day of the plan year
is determined by taking into consideration all of the em-
ployees of all members of the contributing sponsor’s con-
trolled group. In the case of a plan maintained by two or
more contributing sponsors, the employees of all contrib-
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uting sponsors and their controlled groups shall be aggre-
gated for purposes of determining whether the 25-or-fewer-
employees limitation has been satisfied.’’
(c) EFFECTIVE DATES.—
(1) SUBSECTION (a).—The amendments made by
subsection (a) shall apply to plans first effective after
December 31, 2005.
(2) SUBSECTION (b).—The amendments made by
subsection (b) shall apply to plan years beginning
after December 31, 2005.
SEC. 408. AUTHORIZATION FOR PBGC TO PAY INTEREST ON
PREMIUM OVERPAYMENT REFUNDS.
(a) IN GENERAL.—Section 4007(b) of the Employment
Retirement Income Security Act of 1974 (29 U.S.C.
1307(b)) is amended—
(1) by striking ‘‘(b)’’ and inserting ‘‘(b)(1)’’, and
(2) by inserting at the end the following new
paragraph:
‘‘(2) The corporation is authorized to pay, subject to
regulations prescribed by the corporation, interest on the
amount of any overpayment of premium refunded to a des-
ignated payor. Interest under this paragraph shall be cal-
culated at the same rate and in the same manner as interest
is calculated for underpayments under paragraph (1).’’
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(b) EFFECTIVE DATE.—The amendments made by sub-
section (a) shall apply to interest accruing for periods be-
ginning not earlier than the date of the enactment of this
Act.
SEC. 409. RULES FOR SUBSTANTIAL OWNER BENEFITS IN
TERMINATED PLANS.
(a) MODIFICATION OF PHASE-IN OF GUARANTEE.—
Section 4022(b)(5) of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1322(b)(5)) is amended to
read as follows:
‘‘(5)(A) For purposes of this paragraph, the term ‘ma-
jority owner’ means an individual who, at any time during
the 60-month period ending on the date the determination
is being made—
‘‘(i) owns the entire interest in an unincor-
porated trade or business,
‘‘(ii) in the case of a partnership, is a partner
who owns, directly or indirectly, 50 percent or more
of either the capital interest or the profits interest in
such partnership, or
‘‘(iii) in the case of a corporation, owns, directly
or indirectly, 50 percent or more in value of either the
voting stock of that corporation or all the stock of that
corporation.
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For purposes of clause (iii), the constructive ownership
rules of section 1563(e) of the Internal Revenue Code of
1986 (other than paragraph (3)(C) thereof) shall apply, in-
cluding the application of such rules under section 414(c)
of such Code.
‘‘(B) In the case of a participant who is a majority
owner, the amount of benefits guaranteed under this section
shall equal the product of—
‘‘(i) a fraction (not to exceed 1) the numerator
of which is the number of years from the later of the
effective date or the adoption date of the plan to the
termination date, and the denominator of which is
10, and
‘‘(ii) the amount of benefits that would be guar-
anteed under this section if the participant were not
a majority owner.’’
(b) MODIFICATION OF ALLOCATION OF ASSETS.—
(1) Section 4044(a)(4)(B) of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C.
1344(a)(4)(B)) is amended by striking ‘‘section
4022(b)(5)’’ and inserting ‘‘section 4022(b)(5)(B)’’.
(2) Section 4044(b) of such Act (29 U.S.C.
1344(b)) is amended—
(A) by striking ‘‘(5)’’ in paragraph (2) and
inserting ‘‘(4), (5),’’, and
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(B) 
by 
redesignating 
paragraphs 
(3)
through (6) as paragraphs (4) through (7), re-
spectively, and by inserting after paragraph (2)
the following new paragraph:
‘‘(3) If assets available for allocation under
paragraph (4) of subsection (a) are insufficient to sat-
isfy in full the benefits of all individuals who are de-
scribed in that paragraph, the assets shall be allocated
first to benefits described in subparagraph (A) of that
paragraph. Any remaining assets shall then be allo-
cated to benefits described in subparagraph (B) of
that paragraph. If assets allocated to such subpara-
graph (B) are insufficient to satisfy in full the bene-
fits described in that subparagraph, the assets shall be
allocated pro rata among individuals on the basis of
the present value (as of the termination date) of their
respective benefits described in that subparagraph.’’
(c) CONFORMING AMENDMENTS.—
(1) Section 4021 of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1321) is
amended—
(A) in subsection (b)(9), by striking ‘‘as de-
fined in section 4022(b)(6)’’, and
(B) by adding at the end the following new
subsection:
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‘‘(d) For purposes of subsection (b)(9), the term ‘sub-
stantial owner’ means an individual who, at any time dur-
ing the 60-month period ending on the date the determina-
tion is being made—
‘‘(1) owns the entire interest in an unincor-
porated trade or business,
‘‘(2) in the case of a partnership, is a partner
who owns, directly or indirectly, more than 10 per-
cent of either the capital interest or the profits inter-
est in such partnership, or
‘‘(3) in the case of a corporation, owns, directly
or indirectly, more than 10 percent in value of either
the voting stock of that corporation or all the stock of
that corporation.
For purposes of paragraph (3), the constructive ownership
rules of section 1563(e) of the Internal Revenue Code of
1986 (other than paragraph (3)(C) thereof) shall apply, in-
cluding the application of such rules under section 414(c)
of such Code.’’
(2) Section 4043(c)(7) of such Act (29 U.S.C.
1343(c)(7)) 
is 
amended 
by 
striking 
‘‘section
4022(b)(6)’’ and inserting ‘‘section 4021(d)’’.
(d) EFFECTIVE DATES.—
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(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section shall
apply to plan terminations—
(A) under section 4041(c) of the Employee
Retirement Income Security Act of 1974 (29
U.S.C. 1341(c)) with respect to which notices of
intent to terminate are provided under section
4041(a)(2) of such Act (29 U.S.C. 1341(a)(2))
after December 31, 2005, and
(B) under section 4042 of such Act (29
U.S.C. 1342) with respect to which proceedings
are instituted by the corporation after such date.
(2) CONFORMING
AMENDMENTS.—The amend-
ments made by subsection (c) shall take effect on Jan-
uary 1, 2006.
SEC. 410. ACCELERATION OF PBGC COMPUTATION OF BEN-
EFITS ATTRIBUTABLE TO RECOVERIES FROM
EMPLOYERS.
(a) MODIFICATION OF AVERAGE RECOVERY PERCENT-
AGE OF OUTSTANDING AMOUNT OF BENEFIT LIABILITIES
PAYABLE BY CORPORATION TO PARTICIPANTS AND BENE-
FICIARIES.—Section 4022(c)(3)(B)(ii) of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C.
1322(c)(3)(B)(ii)) is amended to read as follows:
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‘‘(ii) notices of intent to terminate
were provided (or in the case of a termi-
nation by the corporation, a notice of deter-
mination under section 4042 was issued)
during the 5-Federal fiscal year period end-
ing with the third fiscal year preceding the
fiscal year in which occurs the date of the
notice of intent to terminate (or the notice
of determination under section 4042) with
respect to the plan termination for which
the recovery ratio is being determined.’’
(b) VALUATION OF SECTION 4062(c) LIABILITY FOR
DETERMINING AMOUNTS PAYABLE BY CORPORATION TO
PARTICIPANTS AND BENEFICIARIES.—
(1) SINGLE-EMPLOYER PLAN BENEFITS GUARAN-
TEED.—Section 4022(c)(3)(A) of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 13)
is amended to read as follows:
‘‘(A) IN GENERAL.—Except as provided in
subparagraph (C), the term ‘recovery ratio’
means the ratio which—
‘‘(i) the sum of the values of all recov-
eries under section 4062, 4063, or 4064, de-
termined by the corporation in connection
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with plan terminations described under sub-
paragraph (B), bears to
‘‘(ii) the sum of all unfunded benefit li-
abilities under such plans as of the termi-
nation date in connection with any such
prior termination.’’.
(2) ALLOCATION OF ASSETS.—Section 4044 of
the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1362) is amended by adding at the
end the following new subsection:
‘‘(e) VALUATION OF SECTION 4062(c) LIABILITY FOR
DETERMINING AMOUNTS PAYABLE BY CORPORATION TO
PARTICIPANTS AND BENEFICIARIES.—
‘‘(1) IN GENERAL.—In the case of a terminated
plan, the value of the recovery of liability under sec-
tion 4062(c) allocable as a plan asset under this sec-
tion for purposes of determining the amount of bene-
fits payable by the corporation shall be determined by
multiplying—
‘‘(A) the amount of liability under section
4062(c) as of the termination date of the plan,
by
‘‘(B) the applicable section 4062(c) recovery
ratio.
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‘‘(2) SECTION 4062(c) RECOVERY
RATIO.—For
purposes of this subsection—
‘‘(A) IN GENERAL.—Except as provided in
subparagraph (C), the term ‘section 4062(c) re-
covery ratio’ means the ratio which—
‘‘(i) the sum of the values of all recov-
eries under section 4062(c) determined by
the corporation in connection with plan ter-
minations described under subparagraph
(B), bears to
‘‘(ii) the sum of all the amounts of li-
ability under section 4062(c) with respect to
such plans as of the termination date in
connection with any such prior termi-
nation.
‘‘(B) PRIOR TERMINATIONS.—A plan termi-
nation described in this subparagraph is a ter-
mination with respect to which—
‘‘(i) the value of recoveries under sec-
tion 4062(c) have been determined by the
corporation, and
‘‘(ii) notices of intent to terminate
were provided (or in the case of a termi-
nation by the corporation, a notice of deter-
mination under section 4042 was issued)
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during the 5-Federal fiscal year period end-
ing with the third fiscal year preceding the
fiscal year in which occurs the date of the
notice of intent to terminate (or the notice
of determination under section 4042) with
respect to the plan termination for which
the recovery ratio is being determined.
‘‘(C) EXCEPTION.—In the case of a termi-
nated plan with respect to which the outstanding
amount of benefit liabilities exceeds $20,000,000,
the term ‘section 4062(c) recovery ratio’ means,
with respect to the termination of such plan, the
ratio of—
‘‘(i) the value of the recoveries on be-
half of the plan under section 4062(c), to
‘‘(ii) the amount of the liability owed
under section 4062(c) as of the date of plan
termination to the trustee appointed under
section 4042 (b) or (c).
‘‘(3) SUBSECTION
NOT
TO
APPLY.—This sub-
section shall not apply with respect to the determina-
tion of—
‘‘(A) whether the amount of outstanding
benefit liabilities exceeds $20,000,000, or
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‘‘(B) the amount of any liability under sec-
tion 4062 to the corporation or the trustee ap-
pointed under section 4042 (b) or (c).
‘‘(4) DETERMINATIONS.—Determinations under
this subsection shall be made by the corporation. Such
determinations shall be binding unless shown by clear
and convincing evidence to be unreasonable.’’
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply for any termination for which notices
of intent to terminate are provided (or in the case of a ter-
mination by the corporation, a notice of determination
under section 4042 under the Employee Retirement Income
Security Act of 1974 is issued) on or after the date which
is 30 days after the date of enactment of this section.
SEC. 411. TREATMENT OF CERTAIN PLANS WHERE CES-
SATION OR CHANGE IN MEMBERSHIP OF A
CONTROLLED GROUP.
(a) IN GENERAL.—Section 4041(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1341(b)) is amended by adding at the end the following new
paragraph:
‘‘(5) SPECIAL RULE FOR CERTAIN PLANS WHERE
CESSATION OR CHANGE IN MEMBERSHIP OF A CON-
TROLLED GROUP.—
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‘‘(A) IN GENERAL.—Except as provided in
subparagraph (B), if—
‘‘(i) there is transaction or series of
transactions which result in a single-em-
ployer plan which is a defined benefit plan
being maintained by an employer which is
not a member of the same controlled group
of which the employer maintaining the plan
before such transaction or series of trans-
actions was a member,
‘‘(ii) the corporation treats the trans-
action or series of transactions as resulting
in a standard termination to which this
subsection applies, and
‘‘(iii) the plan is fully funded,
then the interest rate used in determining wheth-
er the plan is sufficient for benefit liabilities for
purposes of this subsection shall be the interest
rate used in determining whether the plan is
fully funded.
‘‘(B) 
LIMITATIONS.—Subparagraph 
(A)
shall not apply to any transaction or series of
transactions unless—
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‘‘(i) any employer maintaining the
plan immediately before or after such trans-
action or series of transactions—
‘‘(I) has an outstanding senior
unsecured debt instrument which is
rated investment grade by each of the
nationally recognized statistical rating
organizations for corporate bonds that
has issued a credit rating for such in-
strument, or
‘‘(II) if no such debt instrument
of such employer has been rated by
such an organization but 1 or more of
such organizations has made an issuer
credit rating for such employer, all
such organizations which have so rated
the employer have rated such employer
investment grade, and
‘‘(ii) the employer maintaining the
plan after the transaction or series of trans-
actions employs at least 30 percent of the
employees located in the United States who
were employed by such employer imme-
diately before the transaction or series of
transactions.
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‘‘(C) FULLY FUNDED.—For purposes of sub-
paragraph (A), a plan shall be treated as fully
funded with respect to any transaction or series
of transactions if—
‘‘(i) in the case of a transaction or se-
ries of transactions which occur in a plan
year beginning before January 1, 2007, the
funded current liability percentage deter-
mined under section 302(d) for the plan
year is at least 100 percent, and
‘‘(ii) in the case of a transaction or se-
ries of transactions which occur in a plan
year beginning on or after such date, the
funding target attainment percentage deter-
mined under section 303 is, as of the valu-
ation date for such plan year, at least 100
percent.’’
(b) EFFECTIVE DATE.—The amendments made by this
section shall apply to any transaction or series of trans-
actions occurring on and after the date of the enactment
of this Act.
SEC. 412. EFFECT OF TITLE.
The decreases in Federal outlays resulting from the en-
actment of this title, and the amendments made by this
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title, shall be treated as in lieu of the decreases in Federal
outlays which—
(1) resulted from amendments made to title IV
of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1301 et seq.); and
(2) were contained in an Act enacted pursuant
to the concurrent resolution on the budget for fiscal
year 2006.
SEC. 413. AGE REQUIREMENT FOR EMPLOYERS.
(a) SINGLE-EMPLOYER
PLAN
BENEFITS
GUARAN-
TEED.—Section 4022(b) of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1322(b)) is amended
in the flush matter following paragraph (3), by adding at
the end the following: ‘‘If, at the time of termination of a
plan under this title, regulations prescribed by the Federal
Aviation Administration require an individual to separate
from service as a commercial airline pilot after attaining
any age before age 65, paragraph (3) shall be applied to
an individual who is a participant in the plan by reason
of such service by substituting such age for age 65.’’.
(b) MULTIEMPLOYER
PLAN
BENEFITS
GUARAN-
TEED.—Section 4022B(a) of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1322b(a)) is amended
by adding at the end the following: ‘‘If, at the time of termi-
nation of a plan under this title, regulations prescribed by
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the Federal Aviation Administration require an individual
to separate from service as a commercial airline pilot after
attaining any age before age 65, this subsection shall be
applied to an individual who is a participant in the plan
by reason of such service by substituting such age for age
65.’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to benefits payable on or after the date
of enactment of this Act.
TITLE V—DISCLOSURE
SEC. 501. DEFINED BENEFIT PLAN FUNDING NOTICE.
(a) IN GENERAL.—Section 101(f) of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 1021(f))
is amended to read as follows:
‘‘(f) DEFINED BENEFIT PLAN FUNDING NOTICES.—
‘‘(1) IN GENERAL.—The administrator of a de-
fined benefit plan shall for each plan year provide a
plan funding notice to the Pension Benefit Guaranty
Corporation, to each plan participant and bene-
ficiary, to each labor organization representing such
participants or beneficiaries, and, in the case of a
multiemployer plan, to each employer that has an ob-
ligation to contribute to the plan.
‘‘(2) INFORMATION CONTAINED IN NOTICES.—
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‘‘(A) IDENTIFYING INFORMATION.—Each no-
tice required under paragraph (1) shall contain
identifying information, including the name of
the plan, the address and phone number of the
plan administrator and the plan’s principal ad-
ministrative officer, each plan sponsor’s em-
ployer identification number, and the plan num-
ber of the plan.
‘‘(B) 
SPECIFIC
INFORMATION.—A 
plan
funding notice under paragraph (1) shall
include—
‘‘(i)(I) in the case of a single-employer
plan, a statement as to whether the plan’s
funding target attainment percentage (as
defined in section 303(d)(2)) for the plan
year to which the notice relates, and for the
2 preceding plan years, is at least 100 per-
cent (and, if not, the actual percentages), or
‘‘(II) in the case of a multiemployer
plan, a statement as to whether the plan’s
funded percentage (as defined in section
305(i)) for the plan year to which the notice
relates, and for the 2 preceding plan years,
is at least 100 percent (and, if not, the ac-
tual percentages),
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‘‘(ii)(I) in the case of a single-employer
plan, a statement of the value of the plan’s
assets and liabilities for the plan year to
which the notice relates as of the last day
of the plan year to which the notice relates
determined using the asset valuation under
subclause (I) of section 4006(a)(3)(E)(iii)
and the interest rate under subclause (II) of
such section, and
‘‘(II) in the case of a multiemployer
plan, a statement of the value of the plan’s
assets and liabilities for the plan year to
which the notice relates as the last day of
such plan year,
‘‘(iii) a statement of the number of
participants who are—
‘‘(I) retired or separated from
service and are receiving benefits,
‘‘(II) retired or separated partici-
pants entitled to future benefits, and
‘‘(II) active participants under
the plan,
‘‘(iv) a statement setting forth the
funding policy of the plan and the asset al-
location of investments under the plan (ex-
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pressed as percentages of total assets) as of
the end of the plan year to which the notice
relates,
‘‘(v) in the case of a multiemployer
plan, whether the plan was in critical or
endangered status under section 305 for
such plan year and, if so—
‘‘(I) a list of the actions taken by
the plan to improve its funding status,
and
‘‘(II) a statement describing how
a person may obtain a copy of the
plan’s improvement or rehabilitation
plan, as appropriate, adopted under
section 305 and the actuarial and fi-
nancial data that demonstrate any ac-
tion taken by the plan toward fiscal
improvement,
‘‘(vi) a summary of any funding im-
provement plan, rehabilitation plan, or
modification thereof adopted under section
305 during the plan year to which the no-
tice relates,
‘‘(vii) in the case of any plan amend-
ments, scheduled benefit increase or reduc-
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tion, or other known event taking effect in
the current plan year and having a mate-
rial effect on plan liabilities or assets for
the year (as defined in regulations by the
Secretary), an explanation of the amend-
ment, schedule increase or reduction, or
event, and a projection to the end of such
plan year of the effect of the amendment,
scheduled increase or reduction, or event on
plan liabilities,
‘‘(viii)(I) in the case of a single-em-
ployer plan, a summary of the rules gov-
erning termination of single-employer plans
under subtitle C of title IV, or
‘‘(II) in the case of a multiemployer
plan, a summary of the rules governing re-
organization or insolvency, including the
limitations on benefit payments and any
potential benefit reductions and suspensions
(and the potential effects of such limita-
tions, reductions, and suspensions on the
plan), and
‘‘(ix) a general description of the bene-
fits under the plan which are eligible to be
guaranteed by the Pension Benefit Guar-
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anty Corporation, along with an expla-
nation of the limitations on the guarantee
and the circumstances under which such
limitations apply.
‘‘(C) OTHER
INFORMATION.—Each notice
under paragraph (1) shall include—
‘‘(i) in the case of a multiemployer
plan, a statement that the plan adminis-
trator shall provide, upon written request,
to any labor organization representing plan
participants and beneficiaries and any em-
ployer that has an obligation to contribute
to the plan, a copy of the annual report
filed with the Secretary under section
104(a), and
‘‘(ii) 
any 
additional 
information
which the plan administrator elects to in-
clude to the extent not inconsistent with reg-
ulations prescribed by the Secretary.
‘‘(3) TIME FOR PROVIDING NOTICE.—
‘‘(A) IN GENERAL.—Any notice under para-
graph (1) shall be provided not later than 90
days after the end of the plan year to which the
notice relates.
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‘‘(B) EXCEPTION
FOR
SMALL
PLANS.—In
the case of a small plan (as such term is used
under section 303(g)(2)(B)) any notice under
paragraph (1) shall be provided upon filing of
the annual report under section 104(a).
‘‘(4) FORM
AND
MANNER.—Any notice under
paragraph (1)—
‘‘(A) shall be provided in a form and man-
ner prescribed in regulations of the Secretary,
‘‘(B) shall be written in a manner so as to
be understood by the average plan participant,
and
‘‘(C) may be provided in written, electronic,
or other appropriate form to the extent such form
is reasonably accessible to persons to whom the
notice is required to be provided.’’.
(b) MODEL NOTICE.—Not later than 180 days after
the date of the enactment of this Act, the Secretary of Labor
shall publish a model version of the notice required by sec-
tion 101(f) of the Employee Retirement Income Security
Act of 1974. The Secretary of Labor may promulgate any
interim final rules as the Secretary determines appropriate
to carry out the provisions of this subsection.
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(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to plan years beginning after December
31, 2005.
SEC. 502. ACCESS TO MULTIEMPLOYER PENSION PLAN IN-
FORMATION.
(a) FINANCIAL INFORMATION WITH RESPECT TO MUL-
TIEMPLOYER PLANS.—
(1) IN GENERAL.—Section 101 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1021) is amended—
(A) by redesignating subsection (k) as sub-
section (l); and
(B) by inserting after subsection (j) the fol-
lowing new subsection:
‘‘(k) MULTIEMPLOYER
PLAN
INFORMATION
MADE
AVAILABLE ON REQUEST.—
‘‘(1) IN
GENERAL.—Each administrator of a
multiemployer plan shall, upon written request, fur-
nish to any plan participant or beneficiary, employee
representative, or any employer that has an obliga-
tion to contribute to the plan—
‘‘(A) a copy of any periodic actuarial re-
port (including sensitivity testing) received by
the plan for any plan year which has been in the
plan’s possession for at least 30 days, and
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‘‘(B)(i) a copy of any quarterly, semi-an-
nual, or annual financial report prepared for the
plan by any plan investment manager or advi-
sor or other fiduciary which has been in the
plan’s possession for at least 30 days, or
‘‘(ii) at the discretion of the person submit-
ting the written request, a copy of a quarterly
summary of the financial reports described
clause (i).
‘‘(2) COMPLIANCE.—Information required to be
provided under paragraph (1) —
‘‘(A) shall be provided to the requesting par-
ticipant, beneficiary, or employer within 30 days
after the request in a form and manner pre-
scribed in regulations of the Secretary,
‘‘(B) may be provided in written, electronic,
or other appropriate form to the extent such form
is reasonably accessible to persons to whom the
information is required to be provided, and
‘‘(C) shall not—
‘‘(i) include any individually identifi-
able information regarding any plan par-
ticipant, beneficiary, employee, fiduciary,
or contributing employer, or
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‘‘(ii) reveal any proprietary informa-
tion regarding the plan, any contributing
employer, or entity providing services to the
plan.
‘‘(3) LIMITATIONS.—In no case shall a partici-
pant, beneficiary, or employer be entitled under this
subsection to receive more than one copy of any report
described in paragraph (1) during any one 12-month
period. The administrator may make a reasonable
charge to cover copying, mailing, and other costs of
furnishing copies of information pursuant to para-
graph (1). The Secretary may by regulations pre-
scribe the maximum amount which will constitute a
reasonable charge under the preceding sentence.’’.
(2) ENFORCEMENT.—Section 502(c)(4) of such
Act (29 U.S.C. 1132(c)(4)) is amended by striking
‘‘section 101(j)’’ and inserting ‘‘subsection (j) or (k)
of section 101’’.
(3) REGULATIONS.—The Secretary shall pre-
scribe regulations under section 101(k)(2) of the Em-
ployee Retirement Income Security Act of 1974
(added by paragraph (1)) not later than 270 days
after the date of the enactment of this Act.
(b) NOTICE OF POTENTIAL WITHDRAWAL LIABILITY
TO MULTIEMPLOYER PLANS.—
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(1) IN GENERAL.—Section 101 of such Act (as
amended by subsection (a)) is amended—
(A) by redesignating subsection (l) as sub-
section (m); and
(B) by inserting after subsection (k) the fol-
lowing new subsection:
‘‘(l) NOTICE
OF POTENTIAL WITHDRAWAL LIABIL-
ITY.—
‘‘(1) IN GENERAL.—The plan sponsor or admin-
istrator of a multiemployer plan shall, upon written
request, furnish to any employer who has an obliga-
tion to contribute to the plan a notice of—
‘‘(A) the estimated amount which would be
the amount of such employer’s withdrawal liabil-
ity under part 1 of subtitle E of title IV if such
employer withdrew on the last day of the plan
year preceding the date of the request, and
‘‘(B) an explanation of how such estimated
liability amount was determined, including the
actuarial assumptions and methods used to de-
termine the value of the plan liabilities and as-
sets, the data regarding employer contributions,
unfunded vested benefits, annual changes in the
plan’s unfunded vested benefits, and the applica-
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tion of any relevant limitations on the estimated
withdrawal liability.
For purposes of subparagraph (B), the term ‘employer
contribution’ means, in connection with a partici-
pant, a contribution made by an employer as an em-
ployer of such participant.
‘‘(2) COMPLIANCE.—Any notice required to be
provided under paragraph (1)—
‘‘(A) shall be provided to the requesting em-
ployer within—
‘‘(i) 180 days after the request in a
form and manner prescribed in regulations
of the Secretary, or
‘‘(ii) subject to regulations of the Sec-
retary, such longer time as may be nec-
essary in the case of a plan that determines
withdrawal liability based on any method
described under paragraph (4) or (5) of sec-
tion 4211(c); and
‘‘(B) may be provided in written, electronic,
or other appropriate form to the extent such form
is reasonably accessible to employers to whom the
information is required to be provided.
‘‘(3) LIMITATIONS.—In no case shall an em-
ployer be entitled under this subsection to receive
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more than one notice described in paragraph (1) dur-
ing any one 12-month period. The person required to
provide such notice may make a reasonable charge to
cover copying, mailing, and other costs of furnishing
such notice pursuant to paragraph (1). The Secretary
may by regulations prescribe the maximum amount
which will constitute a reasonable charge under the
preceding sentence.’’.
(2) ENFORCEMENT.—Section 502(c)(4) of such
Act (29 U.S.C. 1132(c)(4)) is amended by striking
‘‘section 101(j) or (k)’’ and inserting ‘‘subsection (j),
(k), or (l) of section 101’’.
(c) NOTICE OF AMENDMENT REDUCING FUTURE AC-
CRUALS.—Section 204(h)(1) of such Act (29 U.S.C.
1054(h)(1)) is amended by inserting at the end before the
period ‘‘and to each employer who has an obligation to con-
tribute to the plan.’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply to plan years beginning after December
31, 2005.
SEC. 503. ADDITIONAL ANNUAL REPORTING REQUIRE-
MENTS.
(a) ADDITIONAL ANNUAL REPORTING REQUIREMENTS
WITH RESPECT TO DEFINED BENEFIT PLANS.—
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(1) IN GENERAL.—Section 103 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1023) is amended—
(A) in subsection (a)(1)(B), by striking
‘‘subsections (d) and (e)’’ and inserting ‘‘sub-
sections (d), (e), and (f)’’; and
(B) by adding at the end the following new
subsection:
‘‘(f) ADDITIONAL INFORMATION WITH RESPECT TO
DEFINED BENEFIT PLANS.—
‘‘(1) GENERAL INFORMATION.—With respect to
any defined benefit plan, an annual report under this
section for a plan year shall include the following:
‘‘(A) In any case in which any liabilities to
participants or their beneficiaries under such
plan as of the end of such plan year consist (in
whole or in part) of liabilities to such partici-
pants and beneficiaries under 2 or more pension
plans as of immediately before such plan year,
the funded percentage of each of such 2 or more
pension plans as of the last day of such plan
year and the funded percentage of the plan with
respect to which the annual report is filed as of
the last day of such plan year.
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‘‘(B) For purposes of this paragraph, the
term ‘funded percentage’—
‘‘(i) in the case of a single-employer
plan, means the funding target attainment
percentage, as defined in section 303(d)(2),
and
‘‘(ii) in the case of a multiemployer
plan, has the meaning given such term in
section 305(i)(2).
‘‘(2) ADDITIONAL INFORMATION FOR MULTIEM-
PLOYER PLANS.—With respect to any defined benefit
plan which is a multiemployer plan, an annual re-
port under this section for a plan year shall include,
in addition to the information required under para-
graph (1), the following, as of the end of the plan year
to which the notice relates:
‘‘(A) The number of employers obligated to
contribute to the plan.
‘‘(B) A list of the employers that contrib-
uted more than 5 percent of the total contribu-
tions to the plan during such plan year.
‘‘(C) The number of participants under the
plan on whose behalf no employer contributions
have been made to the plan for such plan year
and for each of the 2 preceding plan years. For