229 
shall establish separate tables for indi-
viduals whose disabilities occur in 
plan years beginning before January 
1, 1995, and for individuals whose 
disabilities occur in plan years begin-
ning on or after such date. 
‘‘(II) SPECIAL
RULE
FOR
DIS-
ABILITIES OCCURRING AFTER 1994.— 
In the case of disabilities occurring in 
plan years beginning after December 
31, 1994, the tables under subclause 
(I) shall apply only with respect to in-
dividuals described in such subclause 
who are disabled within the meaning 
of title II of the Social Security Act 
and the regulations thereunder. 
‘‘(vi) PERIODIC
REVIEW.—The Sec-
retary of the Treasury shall periodically (at 
least every 5 years) review any tables in ef-
fect under this subparagraph and shall, to 
the extent such Secretary determines nec-
essary, by regulation update the tables to 
reflect the actual experience of pension 
plans and projected trends in such experi-
ence. 
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230 
‘‘(E) REQUIRED
CHANGE
OF
INTEREST 
RATE.—For purposes of determining a plan’s 
current liability for purposes of this para-
graph— 
‘‘(i) IN GENERAL.—If any rate of in-
terest used under the plan under sub-
section (b)(6) to determine cost is not 
within the permissible range, the plan shall 
establish a new rate of interest within the 
permissible range. 
‘‘(ii) PERMISSIBLE RANGE.—For pur-
poses of this subparagraph— 
‘‘(I) IN
GENERAL.—Except as 
provided in subclause (II), the term 
‘permissible range’ means a rate of in-
terest which is not more than 5 per-
cent above, and not more than 10 per-
cent below, the weighted average of 
the rates of interest on 30-year Treas-
ury securities during the 4-year period 
ending on the last day before the be-
ginning of the plan year. 
‘‘(II) 
SECRETARIAL
AUTHOR-
ITY.—If the Secretary of the Treasury 
finds that the lowest rate of interest 
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231 
permissible under subclause (I) is un-
reasonably high, such Secretary may 
prescribe a lower rate of interest, ex-
cept that such rate may not be less 
than 80 percent of the average rate 
determined under such subclause. 
‘‘(iii) 
ASSUMPTIONS.—Notwith-
standing paragraph (3)(A), the interest 
rate used under the plan shall be— 
‘‘(I) determined without taking 
into account the experience of the 
plan and reasonable expectations, but 
‘‘(II) consistent with the assump-
tions which reflect the purchase rates 
which would be used by insurance 
companies to satisfy the liabilities 
under the plan. 
‘‘(7) ANNUAL VALUATION.— 
‘‘(A) IN GENERAL.—For purposes of this 
section, a determination of experience gains and 
losses and a valuation of the plan’s liability 
shall be made not less frequently than once 
every year, except that such determination shall 
be made more frequently to the extent required 
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ccoleman on PROD1PC71 with BILLS
232 
in particular cases under regulations prescribed 
by the Secretary of the Treasury. 
‘‘(B) VALUATION DATE.— 
‘‘(i) CURRENT YEAR.—Except as pro-
vided in clause (ii), the valuation referred 
to in subparagraph (A) shall be made as of 
a date within the plan year to which the 
valuation refers or within one month prior 
to the beginning of such year. 
‘‘(ii) USE
OF
PRIOR
YEAR
VALU-
ATION.—The valuation referred to in sub-
paragraph (A) may be made as of a date 
within the plan year prior to the year to 
which the valuation refers if, as of such 
date, the value of the assets of the plan are 
not less than 100 percent of the plan’s cur-
rent liability (as defined in paragraph 
(6)(D) without regard to clause (iv) there-
of). 
‘‘(iii) 
ADJUSTMENTS.—Information 
under clause (ii) shall, in accordance with 
regulations, be actuarially adjusted to re-
flect significant differences in participants. 
‘‘(iv) LIMITATION.—A change in fund-
ing method to use a prior year valuation, 
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233 
as provided in clause (ii), may not be made 
unless as of the valuation date within the 
prior plan year, the value of the assets of 
the plan are not less than 125 percent of 
the plan’s current liability (as defined in 
paragraph (6)(D) without regard to clause 
(iv) thereof). 
‘‘(8) TIME
WHEN
CERTAIN
CONTRIBUTIONS 
DEEMED MADE.—For purposes of this section, any 
contributions for a plan year made by an employer 
after the last day of such plan year, but not later 
than two and one-half months after such day, shall 
be deemed to have been made on such last day. For 
purposes of this subparagraph, such two and one- 
half month period may be extended for not more 
than six months under regulations prescribed by the 
Secretary of the Treasury. 
‘‘(d) EXTENSION OF AMORTIZATION PERIODS FOR 
MULTIEMPLOYER PLANS.— 
‘‘(1) AUTOMATIC
EXTENSION
UPON
APPLICA-
TION BY CERTAIN PLANS.— 
‘‘(A) IN GENERAL.—If the plan sponsor of 
a multiemployer plan— 
‘‘(i) submits to the Secretary of the 
Treasury an application for an extension of 
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234 
the period of years required to amortize 
any unfunded liability described in any 
clause of subsection (b)(2)(B) or described 
in subsection (b)(4), and 
‘‘(ii) includes with the application a 
certification by the plan’s actuary de-
scribed in subparagraph (B), 
the Secretary of the Treasury shall extend the 
amortization period for the period of time (not 
in excess of 5 years) specified in the applica-
tion. Such extension shall be in addition to any 
extension under paragraph (2). 
‘‘(B) CRITERIA.—A certification with re-
spect to a multiemployer plan is described in 
this subparagraph if the plan’s actuary certifies 
that, based on reasonable assumptions— 
‘‘(i) absent the extension under sub-
paragraph (A), the plan would have an ac-
cumulated funding deficiency in the cur-
rent plan year or any of the 9 succeeding 
plan years, 
‘‘(ii) the plan sponsor has adopted a 
plan to improve the plan’s funding status, 
‘‘(iii) the plan is projected to have suf-
ficient assets to timely pay expected bene-
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235 
fits and anticipated expenditures over the 
amortization period as extended, and 
‘‘(iv) the notice required under para-
graph (3)(A) has been provided. 
‘‘(C) TERMINATION.—The preceding provi-
sions of this paragraph shall not apply with re-
spect to any application submitted after Decem-
ber 31, 2014. 
‘‘(2) ALTERNATIVE EXTENSION.— 
‘‘(A) IN GENERAL.—If the plan sponsor of 
a multiemployer plan submits to the Secretary 
of the Treasury an application for an extension 
of the period of years required to amortize any 
unfunded liability described in any clause of 
subsection (b)(2)(B) or described in subsection 
(b)(4), the Secretary of the Treasury may ex-
tend the amortization period for a period of 
time (not in excess of 10 years reduced by the 
number of years of any extension under para-
graph (1) with respect to such unfunded liabil-
ity) if the Secretary of the Treasury makes the 
determination described in subparagraph (B). 
Such extension shall be in addition to any ex-
tension under paragraph (1). 
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236 
‘‘(B) DETERMINATION.—The Secretary of 
the Treasury may grant an extension under 
subparagraph (A) if such Secretary determines 
that— 
‘‘(i) such extension would carry out 
the purposes of this Act and would provide 
adequate protection for participants under 
the plan and their beneficiaries, and 
‘‘(ii) the failure to permit such exten-
sion would— 
‘‘(I) result in a substantial risk 
to the voluntary continuation of the 
plan, or a substantial curtailment of 
pension benefit levels or employee 
compensation, and 
‘‘(II) be adverse to the interests 
of plan participants in the aggregate. 
‘‘(C) ACTION
BY
SECRETARY
OF
THE 
TREASURY.—The Secretary of the Treasury 
shall act upon any application for an extension 
under this paragraph within 180 days of the 
submission of such application. If such Sec-
retary rejects the application for an extension 
under this paragraph, such Secretary shall pro-
vide notice to the plan detailing the specific rea-
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237 
sons for the rejection, including references to 
the criteria set forth above. 
‘‘(3) ADVANCE NOTICE.— 
‘‘(A) IN GENERAL.—The Secretary of the 
Treasury shall, before granting an extension 
under this subsection, require each applicant to 
provide evidence satisfactory to such Secretary 
that the applicant has provided notice of the fil-
ing of the application for such extension to each 
affected 
party 
(as 
defined 
in 
section 
4001(a)(21)) with respect to the affected plan. 
Such notice shall include a description of the 
extent to which the plan is funded for benefits 
which are guaranteed under title IV and for 
benefit liabilities. 
‘‘(B) CONSIDERATION
OF
RELEVANT
IN-
FORMATION.—The Secretary of the Treasury 
shall consider any relevant information provided 
by a person to whom notice was given under 
paragraph (1).’’. 
(b) SHORTFALL FUNDING METHOD.— 
(1) IN GENERAL.—A multiemployer plan meet-
ing the criteria of paragraph (2) may adopt, use, or 
cease using, the shortfall funding method and such 
adoption, use, or cessation of use of such method, 
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238 
shall be deemed approved by the Secretary of the 
Treasury under section 302(d)(1) of the Employee 
Retirement Income Security Act of 1974 and section 
412(d)(1) of the Internal Revenue Code of 1986. 
(2) CRITERIA.—A multiemployer pension plan 
meets the criteria of this clause if— 
(A) the plan has not used the shortfall 
funding method during the 5-year period ending 
on the day before the date the plan is to use 
the method under paragraph (1); and 
(B) the plan is not operating under an am-
ortization period extension under section 304(d) 
of such Act and did not operate under such an 
extension during such 5-year period. 
(3) SHORTFALL FUNDING METHOD DEFINED.— 
For purposes of this subsection, the term ‘‘shortfall 
funding method’’ means the shortfall funding meth-
od described in Treasury Regulations section 
1.412(c)(1)–2 (26 C.F.R. 1.412(c)(1)–2). 
(4) BENEFIT
RESTRICTIONS
TO
APPLY.—The 
benefit restrictions under section 302(c)(7) of such 
Act and section 412(c)(7) of such Code shall apply 
during any period a multiemployer plan is on the 
shortfall funding method pursuant to this sub-
section. 
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239 
(5) USE OF SHORTFALL METHOD NOT TO PRE-
CLUDE OTHER OPTIONS.—Nothing in this subsection 
shall be construed to affect a multiemployer plan’s 
ability to adopt the shortfall funding method with 
the Secretary’s permission under otherwise applica-
ble regulations or to affect a multiemployer plan’s 
right to change funding methods, with or without 
the Secretary’s consent, as provided in applicable 
rules and regulations. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 301 of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1081) is 
amended by striking subsection (d). 
(2) The table of contents in section 1 of such 
Act (as amended by this Act) is amended by insert-
ing after the item relating to section 303 the fol-
lowing new item: 
‘‘Sec. 304. Minimum funding standards for multiemployer plans.’’. 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply to plan years beginning after 
2007. 
(2) SPECIAL RULE FOR CERTAIN AMORTIZATION 
EXTENSIONS.—If the Secretary of the Treasury 
grants an extension under section 304 of the Em-
ployee Retirement Income Security Act of 1974 and 
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