(1) increasing the awareness and knowledge of 
small employers concerning the availability and use 
of the program; 
(2) taking into account special concerns and 
circumstances that small employers face with respect 
to compliance and correction of compliance failures; 
(3) extending the duration of the self-correction 
period under the Self-Correction Program for signifi-
cant compliance failures; 
(4) expanding the availability to correct insig-
nificant compliance failures under the Self-Correc-
tion Program during audit; and 
(5) assuring that any tax, penalty, or sanction 
that is imposed by reason of a compliance failure is 
not excessive and bears a reasonable relationship to 
the nature, extent, and severity of the failure. 
The Secretary of the Treasury shall have full authority 
to effectuate the foregoing with respect to the Employee 
Plans Compliance Resolution System (or any successor 
program) and any other employee plans correction poli-
cies, including the authority to waive income, excise, or 
other taxes to ensure that any tax, penalty, or sanction 
is not excessive and bears a reasonable relationship to the 
nature, extent, and severity of the failure.
SEC. 204. FLEXIBILITY IN NONDISCRIMINATION, COV-
ERAGE, AND LINE OF BUSINESS RULES. 
(a) NONDISCRIMINATION.—
(1) IN GENERAL.—The Secretary of the Treas-
ury shall, by regulation, provide that a plan shall be 
deemed to satisfy the requirements of section 
401(a)(4) of the Internal Revenue Code of 1986 if 
such plan satisfies the facts and circumstances test 
under section 401(a)(4) of such Code, as in effect 
before January 1, 1994, but only if—
(A) the plan satisfies conditions prescribed 
by the Secretary to appropriately limit the 
availability of such test; and 
(B) the plan is submitted to the Secretary 
for a determination of whether it satisfies such 
test. 
Subparagraph (B) shall only apply to the extent pro-
vided by the Secretary. 
(2) EFFECTIVE DATES.—
(A) REGULATIONS.—The regulation re-
quired by paragraph (1) shall apply to years be-
ginning after December 31, 2004. 
(B) CONDITIONS OF AVAILABILITY.—Any 
condition of availability prescribed by the Sec-
retary under paragraph (1)(A) shall not apply 
before the first year beginning not less than
120 days after the date on which such condition 
is prescribed. 
(b) COVERAGE TEST.—
(1) IN GENERAL.—Section 410(b)(1) of the In-
ternal Revenue Code of 1986 (relating to minimum 
coverage requirements) is amended by adding at the 
end the following: 
‘‘(D) In the case that the plan fails to 
meet the requirements of subparagraphs (A), 
(B) and (C), the plan—
‘‘(i) satisfies subparagraph (B), as in 
effect immediately before the enactment of 
the Tax Reform Act of 1986, 
‘‘(ii) is submitted to the Secretary for 
a determination of whether it satisfies the 
requirement described in clause (i), and 
‘‘(iii) satisfies conditions prescribed by 
the Secretary by regulation that appro-
priately limit the availability of this sub-
paragraph. 
Clause (ii) shall apply only to the extent pro-
vided by the Secretary.’’. 
(2) EFFECTIVE DATES.—
(A) IN GENERAL.—The amendment made 
by paragraph (1) shall apply to years beginning 
after December 31, 2004. 
(B) CONDITIONS OF AVAILABILITY.—Any 
condition of availability prescribed by the Sec-
retary under regulations prescribed by the Sec-
retary under section 410(b)(1)(D) of the Inter-
nal Revenue Code of 1986 shall not apply be-
fore the first year beginning not less than 120 
days after the date on which such condition is 
prescribed. 
(c) LINE OF BUSINESS RULES.—The Secretary of 
the Treasury shall, on or before December 31, 2004, mod-
ify the existing regulations issued under section 414(r) of 
the Internal Revenue Code of 1986 in order to expand 
(to the extent that the Secretary determines appropriate) 
the ability of a pension plan to demonstrate compliance 
with the line of business requirements based upon the 
facts and circumstances surrounding the design and oper-
ation of the plan, even though the plan is unable to satisfy 
the mechanical tests currently used to determine compli-
ance.
SEC. 205. EXTENSION TO ALL GOVERNMENTAL PLANS OF 
MORATORIUM ON APPLICATION OF CERTAIN 
NONDISCRIMINATION RULES APPLICABLE TO 
STATE AND LOCAL PLANS. 
(a) IN GENERAL.—
(1) Subparagraph (G) of section 401(a)(5) of 
the Internal Revenue Code of 1986 and subpara-
graph (H) of section 401(a)(26) of such Code are 
each amended by striking ‘‘section 414(d))’’ and all 
that follows and inserting ‘‘section 414(d)).’’. 
(2) Subparagraph (G) of section 401(k)(3) of 
the Internal Revenue Code of 1986 and paragraph 
(2) of section 1505(d) of the Taxpayer Relief Act of 
1997 are each amended by striking ‘‘maintained by 
a State or local government or political subdivision 
thereof (or agency or instrumentality thereof)’’. 
(b) CONFORMING AMENDMENTS.—
(1) The heading for subparagraph (G) of sec-
tion 401(a)(5) of such Code is amended to read as 
follows: ‘‘GOVERNMENTAL PLANS.—’’. 
(2) The heading for subparagraph (H) of sec-
tion 401(a)(26) of such Code is amended to read as 
follows: 
‘‘EXCEPTION
FOR
GOVERNMENTAL
PLANS.—’’.
(3) Subparagraph (G) of section 401(k)(3) of 
such Code is amended by inserting ‘‘GOVERN-
MENTAL PLANS.—’’ after ‘‘(G)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to years beginning after December 
31, 2003. 
SEC. 206. NOTICE AND CONSENT PERIOD REGARDING DIS-
TRIBUTIONS. 
(a) EXPANSION OF PERIOD.—
(1) AMENDMENT
OF
INTERNAL
REVENUE 
CODE.—
(A) IN
GENERAL.—Subparagraph (A) of 
section 417(a)(6) of the Internal Revenue Code 
of 1986 is amended by striking ‘‘90-day’’ and 
inserting ‘‘180-day’’. 
(B) MODIFICATION
OF
REGULATIONS.—
The Secretary of the Treasury shall modify the 
regulations under sections 402(f), 411(a)(11), 
and 417 of the Internal Revenue Code of 1986 
to substitute ‘‘180 days’’ for ‘‘90 days’’ each 
place it appears in Treasury Regulations sec-
tions 1.402(f)–1, 1.411(a)–11(c), and 1.417(e)–
1(b). 
(2) AMENDMENT OF ERISA.—
(A) IN GENERAL.—Section 205(c)(7)(A) of 
the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1055(c)(7)(A)) is amended 
by striking ‘‘90-day’’ and inserting ‘‘180-day’’. 
(B) MODIFICATION
OF
REGULATIONS.—
The Secretary of the Treasury shall modify the 
regulations under part 2 of subtitle B of title 
I of the Employee Retirement Income Security 
Act of 1974 to the extent that they relate to 
sections 203(e) and 205 of such Act to sub-
stitute ‘‘180 days’’ for ‘‘90 days’’ each place it 
appears. 
(3) EFFECTIVE DATE.—The amendments made 
by paragraphs (1)(A) and (2)(A) and the modifica-
tions required by paragraphs (1)(B) and (2)(B) 
shall apply to years beginning after December 31, 
2003. 
(b) CONSENT REGULATION INAPPLICABLE TO CER-
TAIN DISTRIBUTIONS.—
(1) IN GENERAL.—The Secretary of the Treas-
ury shall modify the regulations under section 
411(a)(11) of the Internal Revenue Code of 1986 
and under section 205 of the Employee Retirement 
Income Security Act of 1974 to provide that the de-
scription of a participant’s right, if any, to defer re-
ceipt of a distribution shall also describe the con-
sequences of failing to defer such receipt. 
(2) EFFECTIVE DATE.—
(A) IN GENERAL.—The modifications re-
quired by paragraph (1) shall apply to years be-
ginning after December 31, 2003. 
(B) REASONABLE NOTICE.—In the case of 
any description of such consequences made be-
fore the date that is 90 days after the date on 
which the Secretary of the Treasury issues a 
safe harbor description under paragraph (1), a 
plan shall not be treated as failing to satisfy the 
requirements of section 411(a)(11) of such 
Code or section 205 of such Act by reason of 
the failure to provide the information required 
by the modifications made under paragraph (1) 
if the Administrator of such plan makes a rea-
sonable attempt to comply with such require-
ments. 
SEC. 207. ANNUAL REPORT DISSEMINATION. 
(a) REPORT AVAILABLE THROUGH ELECTRONIC 
MEANS.—Section 104(b)(3) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1024(b)(3)) is 
amended by adding at the end the following new sentence: 
‘‘The requirement to furnish information under the pre-
vious sentence with respect to an employee pension benefit 
plan shall be satisfied if the administrator makes such in-
formation reasonably available through electronic means 
or other new technology.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to reports for years beginning after 
December 31, 2003. 
SEC. 208. TECHNICAL CORRECTIONS TO SAVER ACT. 
Section 517 of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1147) is amended—
(1) in subsection (a), by striking ‘‘2001 and 
2005 on or after September 1 of each year involved’’ 
and inserting ‘‘2006 and 2010’’; 
(2) in subsection (e)(2)—
(A) by striking ‘‘Committee on Labor and 
Human Resources’’ in subparagraph (D) and 
inserting ‘‘Committee on Health, Education, 
Labor, and Pensions’’; 
(B) by striking subparagraph (F) and in-
serting the following: 
‘‘(F) the Chairman and Ranking Member 
of the Subcommittee on Labor, Health and 
Human Services, and Education of the Com-
mittee on Appropriations of the House of Rep-
resentatives and the Chairman and Ranking
Member of the Subcommittee on Labor, Health 
and Human Services, and Education of the 
Committee on Appropriations of the Senate;’’; 
(C) by redesignating subparagraph (G) as 
subparagraph (J); and 
(D) by inserting after subparagraph (F) 
the following new subparagraphs: 
‘‘(G) the Chairman and Ranking Member 
of the Committee on Finance of the Senate; 
‘‘(H) the Chairman and Ranking Member 
of the Committee on Ways and Means of the 
House of Representatives; 
‘‘(I) the Chairman and Ranking Member 
of the Subcommittee on Employer-Employee 
Relations of the Committee on Education and 
the Workforce of the House of Representatives; 
and’’; 
(3) in subsection (e)(3)(B), by striking ‘‘Janu-
ary 31, 1998’’ and inserting ‘‘2 months before the 
convening of each summit;’’; 
(4) in subsection (f)(1)(C), by inserting ‘‘, no 
later than 60 days prior to the date of the com-
mencement of the National Summit,’’ after ‘‘com-
ment’’; 
(5) in subsection (i)—
(A) by striking ‘‘for fiscal years beginning 
on or after October 1, 1997,’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(3) RECEPTION
AND
REPRESENTATION
AU-
THORITY.—The Secretary is hereby granted recep-
tion and representation authority limited specifically 
to the events at the National Summit. The Secretary 
shall use any private contributions accepted in con-
nection with the National Summit prior to using 
funds appropriated for purposes of the National 
Summit pursuant to this paragraph.’’; and 
(6) in subsection (k)—
(A) by striking ‘‘shall enter into a contract 
on a sole-source basis’’ and inserting ‘‘may 
enter into a contract on a sole-source basis’’; 
and 
(B) by striking ‘‘in fiscal year 1998’’. 
SEC. 209. MISSING PARTICIPANTS. 
(a) IN GENERAL.—Section 4050 of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 1350) 
is amended by redesignating subsection (c) as subsection 
(e) and by inserting after subsection (b) the following new 
subsections:
‘‘(c) MULTIEMPLOYER
PLANS.—The corporation 
shall prescribe rules similar to the rules in subsection (a) 
for multiemployer plans covered by this title that termi-
nate under section 4041A. 
‘‘(d) PLANS NOT OTHERWISE SUBJECT TO TITLE.—
‘‘(1) TRANSFER TO CORPORATION.—The plan 
administrator of a plan described in paragraph (4) 
may elect to transfer a missing participant’s benefits 
to the corporation upon termination of the plan. 
‘‘(2) INFORMATION TO THE CORPORATION.—To 
the extent provided in regulations, the plan adminis-
trator of a plan described in paragraph (4) shall, 
upon termination of the plan, provide the corpora-
tion information with respect to benefits of a miss-
ing participant if the plan transfers such benefits—
‘‘(A) to the corporation, or 
‘‘(B) to an entity other than the corpora-
tion or a plan described in paragraph (4)(B)(ii). 
‘‘(3) PAYMENT BY THE CORPORATION.—If ben-
efits of a missing participant were transferred to the 
corporation under paragraph (1), the corporation 
shall, upon location of the participant or beneficiary, 
pay to the participant or beneficiary the amount 
transferred (or the appropriate survivor benefit) ei-
ther—
‘‘(A) in a single sum (plus interest), or 
‘‘(B) in such other form as is specified in 
regulations of the corporation. 
‘‘(4) PLANS DESCRIBED.—A plan is described 
in this paragraph if—
‘‘(A) the plan is a pension plan (within the 
meaning of section 3(2))—
‘‘(i) to which the provisions of this 
section do not apply (without regard to 
this subsection), and 
‘‘(ii) which is not a plan described in 
paragraphs (2) through (11) of section 
4021(b), and 
‘‘(B) at the time the assets are to be dis-
tributed upon termination, the plan—
‘‘(i) has missing participants, and 
‘‘(ii) has not provided for the transfer 
of assets to pay the benefits of all missing 
participants to another pension plan (with-
in the meaning of section 3(2)). 
‘‘(5) CERTAIN PROVISIONS NOT TO APPLY.—
Subsections (a)(1) and (a)(3) shall not apply to a 
plan described in paragraph (4).’’. 
(b) CONFORMING AMENDMENTS.—Section 206(f) of 
such Act (29 U.S.C. 1056(f)) is amended—
(1) by striking ‘‘title IV’’ and inserting ‘‘section 
4050’’; and 
(2) by striking ‘‘the plan shall provide that,’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to distributions made after final 
regulations implementing subsections (c) and (d) of sec-
tion 4050 of the Employee Retirement Income Security 
Act of 1974 (as added by subsection (a)), respectively, are 
prescribed. 
SEC. 210. REDUCED PBGC PREMIUM FOR NEW PLANS OF 
SMALL EMPLOYERS. 
(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: 
‘‘(iv) 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.’’. 
(b) 
DEFINITION
OF
NEW
SINGLE-EMPLOYER 
PLAN.—Section 4006(a)(3) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1306(a)(3)) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(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 
member of such sponsor’s controlled group (or any prede-
cessor 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 single-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 em-
ployees. 
‘‘(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.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plans first effective after Decem-
ber 31, 2003. 
SEC. 211. REDUCTION OF ADDITIONAL PBGC PREMIUM FOR 
NEW AND SMALL 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)(E)) is amended by 
adding at the end the following new clause: 
‘‘(v) 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 
determined under clause (ii) and the applicable percent-
age. For purposes of this clause, the term ‘applicable per-
centage’ 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 
ending on the date of the adoption of the plan, the sponsor 
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)), as amended by section 
210(b), 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 addi-
tional premium determined under subparagraph (E) for 
each participant 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 
employees of all members of the contributing sponsor’s 
controlled group. In the case of a plan maintained by two 
or more contributing sponsors, the employees of all con-
tributing sponsors and their controlled groups shall be ag-
gregated 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, 2003. 
(2) SUBSECTION (b).—The amendments made 
by subsection (b) shall apply to plan years beginning 
after December 31, 2003. 
SEC. 212. AUTHORIZATION FOR PBGC TO PAY INTEREST ON 
PREMIUM OVERPAYMENT REFUNDS. 
(a) IN GENERAL.—Section 4007(b) of the Employ-
ment 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 inter-
est is calculated for underpayments under paragraph 
(1).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to interest accruing for periods 
beginning not earlier than the date of the enactment of 
this Act. 
SEC. 213. SUBSTANTIAL OWNER BENEFITS IN TERMINATED 
PLANS. 
(a) MODIFICATION OF PHASE-IN OF GUARANTEE.—
Section 4022(b)(5) of the Employee Retirement Income 
Security 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 
‘majority owner’ means an individual who, at any time 
during the 60-month period ending on the date the deter-
mination 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. 
For purposes of clause (iii), the constructive ownership 
rules of section 1563(e) of the Internal Revenue Code of 
1986 shall apply (determined without regard to section 
1563(e)(3)(C)). 
‘‘(B) In the case of a participant who is a majority 
owner, the amount of benefits guaranteed under this sec-
tion 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 
(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 
satisfy in full the benefits of all individuals who are 
described in that paragraph, the assets shall be allo-
cated first to benefits described in subparagraph (A) 
of that paragraph. Any remaining assets shall then 
be allocated to benefits described in subparagraph 
(B) of that paragraph. If assets allocated to such 
subparagraph (B) are insufficient to satisfy in full 
the benefits described in that subparagraph, the as-
sets 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 
Income Security Act of 1974 (29 U.S.C. 1321) is 
amended—
(A) in subsection (b)(9), by striking ‘‘as 
defined in section 4022(b)(6)’’, and 
(B) by adding at the end the following new 
subsection: 
‘‘(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 shall apply (determined without regard to section 
1563(e)(3)(C)).’’.
(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.—
(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 sec-
tion 4041(a)(2) of such Act (29 U.S.C. 
1341(a)(2)) after December 31, 2003, 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 
January 1, 2004. 
SEC. 214. BENEFIT SUSPENSION NOTICE. 
(a) MODIFICATION OF REGULATION.—The Secretary 
of Labor shall modify the regulation under subparagraph 
(B) of section 203(a)(3) of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1053(a)(3)(B)) to
provide that the notification required by such regulation 
in connection with any suspension of benefits described in 
such subparagraph—
(1) in the case of an employee who returns to 
service described in section 203(a)(3)(B)(i) or (ii) of 
such Act after commencement of payment of bene-
fits under the plan, shall be made during the first 
calendar month or the first 4 or 5-week payroll pe-
riod ending in a calendar month in which the plan 
withholds payments, and 
(2) in the case of any employee who is not de-
scribed in paragraph (1)—
(A) may be included in the summary plan 
description for the plan furnished in accordance 
with section 104(b) of such Act (29 U.S.C. 
1024(b)), rather than in a separate notice, and 
(B) need not include a copy of the relevant 
plan provisions. 
(b) EFFECTIVE
DATE.—The modification made 
under this section shall apply to plan years beginning after 
December 31, 2003. 
SEC. 215. STUDIES. 
(a) MODEL
SMALL
EMPLOYER
GROUP
PLANS 
STUDY.—As soon as practicable after the date of the en-
actment of this Act, the Secretary of Labor, in consulta-
tion with the Secretary of the Treasury, shall conduct a 
study to determine—
(1) the most appropriate form or forms of—
(A) employee pension benefit plans which 
would—
(i) be simple in form and easily main-
tained by multiple small employers, and 
(ii) provide for ready portability of 
benefits for all participants and bene-
ficiaries, 
(B) alternative arrangements providing 
comparable benefits which may be established 
by employee or employer associations, and 
(C) alternative arrangements providing 
comparable benefits to which employees may 
contribute in a manner independent of employer 
sponsorship, and 
(2) appropriate methods and strategies for 
making pension plan coverage described in para-
graph (1) more widely available to American work-
ers. 
(b) MATTERS TO BE CONSIDERED.—In conducting 
the study under subsection (a), the Secretary of Labor 
shall consider the adequacy and availability of existing em-
ployee pension benefit plans and the extent to which exist-
ing models may be modified to be more accessible to both 
employees and employers. 
(c) REPORT.—Not later than 18 months after the 
date of the enactment of this Act, the Secretary of Labor 
shall report the results of the study under subsection (a), 
together with the Secretary’s recommendations, to the 
Committee on Education and the Workforce and the Com-
mittee on Ways and Means of the House of Representa-
tives and the Committee on Health, Education, Labor, 
and Pensions and the Committee on Finance of the Sen-
ate. Such recommendations shall include one or more 
model plans described in subsection (a)(1)(A) and model 
alternative 
arrangements 
described 
in 
subsections 
(a)(1)(B) and (a)(1)(C) which may serve as the basis for 
appropriate administrative or legislative action. 
(d) STUDY ON EFFECT OF LEGISLATION.—Not later 
than 5 years after the date of the enactment of this Act, 
the Secretary of Labor shall submit to the Committee on 
Education and the Workforce of the House of Representa-
tives and the Committee on Health, Education, Labor, 
and Pensions of the Senate a report on the effect of the 
provisions of this Act and title VI of the Economic Growth 
and Tax Relief Reconciliation Act of 2001 on pension plan 
coverage, including any change in—
(1) the extent of pension plan coverage for low 
and middle-income workers, 
(2) the levels of pension plan benefits generally, 
(3) the quality of pension plan coverage gen-
erally, 
(4) workers’ access to and participation in pen-
sion plans, and 
(5) retirement security.
SEC. 216. INTEREST RATE RANGE FOR ADDITIONAL FUND-
ING REQUIREMENTS. 
(a) IN
GENERAL.—Subclause (III) of section 
412(l)(7)(C)(i) of the Internal Revenue Code of 1986 is 
amended—
(1) by striking ‘‘2002 or 2003’’ in the text and 
inserting ‘‘2001, 2002, or 2003’’, and 
(2) by striking ‘‘2002 AND 2003’’ in the heading 
and inserting ‘‘2001, 2002, AND 2003’’. 
(b) SPECIAL
RULE.—Subclause (III) of section 
302(d)(7)(C)(i) of the Employee Retirement Income Secu-
rity Act of 1974 (29 U.S.C. 1082(d)(7)(C)(i)) is amend-
ed—
(1) by striking ‘‘2002 or 2003’’ in the text and 
inserting ‘‘2001, 2002, or 2003’’, and 
(2) by striking ‘‘2002 AND 2003’’ in the heading 
and inserting ‘‘2001, 2002, AND 2003’’.
(c) 
PBGC.—Subclause 
(IV) 
of 
section 
4006(a)(3)(E)(iii) 
of 
such 
Act 
(29 
U.S.C. 
1306(a)(3)(E)(iii)) is amended to read as follows—
‘‘(IV) In the case of plan years beginning after 
December 31, 2001, and before January 1, 2004, 
subclause (II) shall be applied by substituting ‘100 
percent’ for ‘85 percent’ and by substituting ‘115 
percent’ for ‘100 percent’. Subclause (III) shall be 
applied for such years without regard to the pre-
ceding sentence. Any reference to this clause or this 
subparagraph by any other sections or subsections 
(other than sections 4005, 4010, 4011 and 4043) 
shall be treated as a reference to this clause or this 
subparagraph without regard to this subclause.’’. 
(d) EFFECTIVE DATE.—
(1) GENERAL RULE.—Subject to paragraph (2), 
the amendments made by this section shall take ef-
fect as if included in the amendments made by sec-
tion 405 of the Job Creation and Worker Assistance 
Act of 2002. 
(2) ELECTION.—The plan sponsor or plan ad-
ministrator of a plan may elect whether to have the 
amendments made by subsections (a) and (b) apply. 
Such election shall be made in such manner and at 
such time as the Secretary of the Treasury or his
delegate may prescribe and, once made, may not be 
revoked. An election to apply such amendments shall 
not be treated as a prohibited change in actuarial 
assumptions for purposes of reports required to be 
filed with the Secretary of Labor, the Secretary of 
Treasury, or the Pension Benefit Guaranty Corpora-
tion. 
TITLE III—GENERAL 
PROVISIONS 
SEC. 301. PROVISIONS RELATING TO PLAN AMENDMENTS. 
(a) IN GENERAL.—If this section applies to any plan 
or contract amendment—
(1) such plan or contract shall be treated as 
being operated in accordance with the terms of the 
plan during the period described in subsection 
(b)(2)(A), and 
(2) except as provided by the Secretary of the 
Treasury, such plan shall not fail to meet the re-
quirements of section 411(d)(6) of the Internal Rev-
enue Code of 1986 and section 204(g) of the Em-
ployee Retirement Income Security Act of 1974 by 
reason of such amendment. 
(b) AMENDMENTS TO WHICH SECTION APPLIES.—
(1) IN GENERAL.—This section shall apply to 
any amendment to any plan or annuity contract 
which is made—
(A) pursuant to any amendment made by 
section 101, 102, 103, or 104, by title II, or by 
title VI of the Economic Growth and Tax Relief 
Reconciliation Act of 2001, or pursuant to any 
regulation issued by the Secretary of the Treas-
ury or the Secretary of Labor under any such 
section, title II, or such title VI, and 
(B) on or before the last day of the first 
plan year beginning on or after January 1, 
2006. 
In the case of a governmental plan (as defined in 
section 414(d) of the Internal Revenue Code of 
1986), this paragraph shall be applied by sub-
stituting ‘‘2008’’ for ‘‘2006’’. 
(2) CONDITIONS.—This section shall not apply 
to any amendment unless—
(A) during the period—
(i) beginning on the date the legisla-
tive or regulatory amendment described in 
paragraph (1)(A) takes effect (or in the 
case of a plan or contract amendment not 
required by such legislative or regulatory