I
106TH CONGRESS
1ST SESSION
H. R. 3246
To amend title IV of the Employee Retirement Income Security Act of
1974 to reduce the amount of premiums required to be paid by small
businesses to the Pension Benefit Guaranty Corporation.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 8, 1999
Mr. BASS (for himself, Mr. DUNCAN, Mrs. CHRISTENSEN, Mrs. ROUKEMA,
Mrs. MYRICK, Mrs. JOHNSON of Connecticut, Mr. PETERSON of Pennsyl-
vania, and Mr. DOYLE) introduced the following bill; which was referred
to the Committee on Education and the Workforce
A BILL
To amend title IV of the Employee Retirement Income Secu-
rity Act of 1974 to reduce the amount of premiums
required to be paid by small businesses to the Pension
Benefit Guaranty Corporation.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Small Business Pen-
sion Accessibility Act of 1999’’.
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) had not established or maintained 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 established after Decem-
ber 31, 2000.
SEC. 3. 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 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 spon-
sor (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 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 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 con-
tributing sponsors and their controlled groups shall be ag-
gregated for purposes of determining whether 25-or-fewer-
employees limitation has been satisfied.’’.
(c) EFFECTIVE DATES.—
(1) SUBSECTION (a).—The amendments made
by subsection (a) shall apply to plans established
after December 31, 2000.
(2) SUBSECTION (b).—The amendments made
by subsection (b) shall apply to plan years beginning
after December 31, 2000.
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