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transportation system projects carried out using 
amounts made available from the Highway Trust 
Fund, including amounts made available to deploy 
intelligent transportation systems, conform to the ap-
propriate regional ITS architecture, applicable stand-
ards, and protocols developed under subsection (a) or 
(c). 
‘‘(2) DISCRETION OF THE SECRETARY.—The Sec-
retary, at the discretion of the Secretary, may offer 
an exemption from paragraph (1) for projects de-
signed to achieve specific research objectives outlined 
in the national intelligent transportation system pro-
gram plan or the surface transportation research and 
development strategic plan developed under section 
508.’’. 
(b) CONFORMING
AMENDMENT.—The analysis for 
chapter 5 of title 23, United States Code, is amended by 
adding after the item relating to section 516 (as added by 
section 53004) the following: 
‘‘517. National architecture and standards.’’. 
SEC. 53006. VEHICLE-TO-VEHICLE AND VEHICLE-TO-INFRA-
STRUCTURE COMMUNICATIONS SYSTEMS DE-
PLOYMENT. 
(a) IN GENERAL.—Chapter 5 of title 23, United States 
Code, is amended by adding after section 517 (as added 
by section 53005) the following:
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‘‘§ 518. Vehicle-to-vehicle and vehicle-to-infrastructure 
communications systems deployment 
‘‘(a) IN GENERAL.—Not later than 3 years after the 
date of enactment of this section, the Secretary shall submit 
a report to the Committee on Commerce, Science, and 
Transportation of the Senate, the Committee on Environ-
ment and Public Works of the Senate, the Committee on 
Transportation and Infrastructure of the House of Rep-
resentatives, and the Committee on Energy and Commerce 
of the House of Representatives that— 
‘‘(1) defines a recommended implementation 
path for dedicated short-range communications tech-
nology and applications; 
‘‘(2) includes guidance on the relationship of the 
proposed deployment of dedicated short-range commu-
nications to the National ITS Architecture and ITS 
Standards; and 
‘‘(3) ensures competition by not preferencing the 
use of any particular frequency for vehicle to infra-
structure operations. 
‘‘(b) REPORT REVIEW.—The Secretary shall enter into 
agreements with the National Research Council and an 
independent third party with subject matter expertise for 
the review of the report described in subsection (a).’’. 
(b) CONFORMING
AMENDMENT.—The analysis for 
chapter 5 of title 23, United States Code, is amended by
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† HR 4348 EAS 
adding after section 517 (as added by section 53005) the 
following: 
‘‘518. Vehicle-to-vehicle and vehicle-to-infrastructure communications systems de-
ployment.’’. 
DIVISION F—MISCELLANEOUS 
TITLE I—REAUTHORIZATION OF 
CERTAIN PROGRAMS 
Subtitle A—Secure Rural Schools 
and Community Self-determina-
tion Program 
SEC. 100101. SECURE RURAL SCHOOLS AND COMMUNITY 
SELF-DETERMINATION PROGRAM. 
(a) AMENDMENTS.—The Secure Rural Schools and 
Community Self-Determination Act of 2000 (16 U.S.C. 
7101 et seq.) is amended— 
(1) in section 3(11)— 
(A) in subparagraph (A), by striking ‘‘and’’ 
after the semicolon at the end; 
(B) in subparagraph (B)— 
(i) by striking ‘‘fiscal year 2009 and 
each fiscal year thereafter’’ and inserting 
‘‘each of fiscal years 2009 through 2011’’; 
and 
(ii) by striking the period at the end 
and inserting ‘‘; and’’; and 
(C) by adding at the end the following:
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‘‘(C) for fiscal year 2012 and each fiscal 
year thereafter, the amount that is equal to 95 
percent of the full funding amount for the pre-
ceding fiscal year.’’; 
(2) in sections 101, 102, 203, 207, 208, 304, and 
402, by striking ‘‘2011’’ each place it appears and in-
serting ‘‘2012’’; 
(3) in section 102— 
(A) by striking ‘‘2008’’ each place it ap-
pears and inserting ‘‘2012’’; 
(B) in subsection (b)(2)(B), by inserting 
‘‘in 2012’’ before ‘‘, the election’’; and 
(C) in subsection (d)— 
(i) in paragraph (1)(A), by striking 
‘‘paragraph (3)(B)’’ and inserting ‘‘sub-
paragraph (D)’’; and 
(ii) in paragraph (3)— 
(I) by striking subparagraph (A) 
and inserting the following: 
‘‘(A) NOTIFICATION.—The Governor of each 
eligible State shall notify the Secretary concerned 
of an election by an eligible county under this 
subsection not later than September 30, 2012, 
and each September 30 thereafter for each suc-
ceeding fiscal year.’’;
1578 
† HR 4348 EAS 
(II) by redesignating subpara-
graph (B) as subparagraph (D) and 
moving the subparagraph so as to ap-
pear at the end of paragraph (1) of 
subsection (d); and 
(III) by inserting after subpara-
graph (A) the following: 
‘‘(B) FAILURE TO ELECT.—If the Governor 
of an eligible State fails to notify the Secretary 
concerned of the election for an eligible county by 
the date specified in subparagraph (A)— 
‘‘(i) the eligible county shall be consid-
ered to have elected to expend 80 percent of 
the funds in accordance with paragraph 
(1)(A); and 
‘‘(ii) the remainder shall be available 
to the Secretary concerned to carry out 
projects in the eligible county to further the 
purpose described in section 202(b).’’; 
(4) in section 103(d)(2), by striking ‘‘fiscal year 
2011’’ and inserting ‘‘each of fiscal years 2011 and 
2012’’; 
(5) in section 202, by adding at the end the fol-
lowing:
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† HR 4348 EAS 
‘‘(c) ADMINISTRATIVE EXPENSES.—A resource advi-
sory committee may, in accordance with section 203, pro-
pose to use not more than 10 percent of the project funds 
of an eligible county for any fiscal year for administrative 
expenses associated with operating the resource advisory 
committee under this title.’’; 
(6) in section 204(e)(3)(B)(iii), by striking ‘‘and 
2011’’ and inserting ‘‘through 2012’’; 
(7) in section 205(a)(4), by striking ‘‘2006’’ each 
place it appears and inserting ‘‘2011’’; 
(8) in section 208(b), by striking ‘‘2012’’ and in-
serting ‘‘2013’’; 
(9) in section 302(a)(2)(A), by inserting ‘‘and’’ 
after the semicolon; and 
(10) in section 304(b), by striking ‘‘2012’’ and 
inserting ‘‘2013’’. 
(b) FAILURE TO MAKE ELECTION.—For each county 
that failed to make an election for fiscal year 2011 in ac-
cordance with section 102(d)(3)(A) of the Secure Rural 
Schools and Community Self-Determination Act of 2000 
(16 U.S.C. 7112(d)(3)(A)), there shall be available to the 
Secretary of Agriculture to carry out projects to further the 
purpose described in section 202(b) of that Act (16 U.S.C. 
7122(b)), from amounts in the Treasury not otherwise ap-
propriated, the amount that is equal to 15 percent of the
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† HR 4348 EAS 
total share of the State payment that otherwise would have 
been made to the county under that Act for fiscal year 2011. 
Subtitle B—Payment in Lieu of 
Taxes Program 
SEC. 100111. PAYMENTS IN LIEU OF TAXES. 
Section 6906 of title 31, United States Code, is amend-
ed by striking ‘‘2012’’ and inserting ‘‘2013’’. 
Subtitle C—Offsets 
SEC. 100112. TAX REPORTING FOR LIFE SETTLEMENT 
TRANSACTIONS. 
(a) IN GENERAL.—Subpart B of part III of subchapter 
A of chapter 61 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new section: 
‘‘SEC. 6050X. RETURNS RELATING TO CERTAIN LIFE INSUR-
ANCE CONTRACT TRANSACTIONS. 
‘‘(a) REQUIREMENT OF REPORTING OF CERTAIN PAY-
MENTS.— 
‘‘(1) IN GENERAL.—Every person who acquires a 
life insurance contract or any interest in a life insur-
ance contract in a reportable policy sale during any 
taxable year shall make a return for such taxable year 
(at such time and in such manner as the Secretary 
shall prescribe) setting forth— 
‘‘(A) the name, address, and TIN of such 
person,
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‘‘(B) the name, address, and TIN of each re-
cipient of payment in the reportable policy sale, 
‘‘(C) the date of such sale, 
‘‘(D) the name of the issuer of the life insur-
ance contract sold and the policy number of such 
contract, and 
‘‘(E) the amount of each payment. 
‘‘(2) STATEMENT TO BE FURNISHED TO PERSONS 
WITH
RESPECT
TO
WHOM
INFORMATION
IS
RE-
QUIRED.—Every person required to make a return 
under this subsection shall furnish to each person 
whose name is required to be set forth in such return 
a written statement showing— 
‘‘(A) the name, address, and phone number 
of the information contact of the person required 
to make such return, and 
‘‘(B) the information required to be shown 
on such return with respect to such person, ex-
cept that in the case of an issuer of a life insur-
ance contract, such statement is not required to 
include the information specified in paragraph 
(1)(E). 
‘‘(b) REQUIREMENT
OF REPORTING
OF SELLER’S 
BASIS IN LIFE INSURANCE CONTRACTS.—
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‘‘(1) IN GENERAL.—Upon receipt of the state-
ment required under subsection (a)(2) or upon notice 
of a transfer of a life insurance contract to a foreign 
person, each issuer of a life insurance contract shall 
make a return (at such time and in such manner as 
the Secretary shall prescribe) setting forth— 
‘‘(A) the name, address, and TIN of the sell-
er who transfers any interest in such contract in 
such sale, 
‘‘(B) the investment in the contract (as de-
fined in section 72(e)(6)) with respect to such 
seller, and 
‘‘(C) the policy number of such contract. 
‘‘(2) STATEMENT TO BE FURNISHED TO PERSONS 
WITH
RESPECT
TO
WHOM
INFORMATION
IS
RE-
QUIRED.—Every person required to make a return 
under this subsection shall furnish to each person 
whose name is required to be set forth in such return 
a written statement showing— 
‘‘(A) the name, address, and phone number 
of the information contact of the person required 
to make such return, and 
‘‘(B) the information required to be shown 
on such return with respect to each seller whose 
name is required to be set forth in such return.
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‘‘(c) REQUIREMENT OF REPORTING WITH RESPECT TO 
REPORTABLE DEATH BENEFITS.— 
‘‘(1) IN GENERAL.—Every person who makes a 
payment of reportable death benefits during any tax-
able year shall make a return for such taxable year 
(at such time and in such manner as the Secretary 
shall prescribe) setting forth— 
‘‘(A) the name, address, and TIN of the per-
son making such payment, 
‘‘(B) the name, address, and TIN of each re-
cipient of such payment, 
‘‘(C) the date of each such payment, and 
‘‘(D) the amount of each such payment. 
‘‘(2) STATEMENT TO BE FURNISHED TO PERSONS 
WITH
RESPECT
TO
WHOM
INFORMATION
IS
RE-
QUIRED.—Every person required to make a return 
under this subsection shall furnish to each person 
whose name is required to be set forth in such return 
a written statement showing— 
‘‘(A) the name, address, and phone number 
of the information contact of the person required 
to make such return, and 
‘‘(B) the information required to be shown 
on such return with respect to each recipient of
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† HR 4348 EAS 
payment whose name is required to be set forth 
in such return. 
‘‘(d) DEFINITIONS.—For purposes of this section: 
‘‘(1) PAYMENT.—The term ‘payment’ means the 
amount of cash and the fair market value of any con-
sideration transferred in a reportable policy sale. 
‘‘(2) REPORTABLE POLICY SALE.—The term ‘re-
portable policy sale’ has the meaning given such term 
in section 101(a)(3)(B). 
‘‘(3) ISSUER.—The term ‘issuer’ means any life 
insurance company that bears the risk with respect to 
a life insurance contract on the date any return or 
statement is required to be made under this section. 
‘‘(4) REPORTABLE DEATH BENEFITS.—The term 
‘reportable death benefits’ means amounts paid by 
reason of the death of the insured under a life insur-
ance contract that has been transferred in a report-
able policy sale.’’. 
(b) CLERICAL AMENDMENT.—The table of sections for 
subpart B of part III of subchapter A of chapter 61 of the 
Internal Revenue Code of 1986 is amended by inserting 
after the item relating to section 6050W the following new 
item: 
‘‘Sec. 6050X. Returns relating to certain life insurance contract transactions.’’. 
(c) CONFORMING AMENDMENTS.—
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† HR 4348 EAS 
(1) Subsection (d) of section 6724 of the Internal 
Revenue Code of 1986 is amended— 
(A) by striking ‘‘or’’ at the end of clause 
(xxiv) of paragraph (1)(B), by striking ‘‘and’’ at 
the end of clause (xxv) of such paragraph and 
inserting ‘‘or’’, and by inserting after such clause 
(xxv) the following new clause: 
‘‘(xxvi) section 6050X (relating to re-
turns relating to certain life insurance con-
tract transactions), and’’, and 
(B) by striking ‘‘or’’ at the end of subpara-
graph (GG) of paragraph (2), by striking the pe-
riod at the end of subparagraph (HH) of such 
paragraph and inserting ‘‘, or’’, and by insert-
ing after such subparagraph (HH) the following 
new subparagraph: 
‘‘(II) subsection (a)(2), (b)(2), or (c)(2) of 
section 6050X (relating to returns relating to 
certain life insurance contract transactions).’’. 
(2) Section 6047 of such Code is amended— 
(A) by redesignating subsection (g) as sub-
section (h), 
(B) by inserting after subsection (f) the fol-
lowing new subsection:
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† HR 4348 EAS 
‘‘(g) INFORMATION RELATING
TO LIFE INSURANCE 
CONTRACT TRANSACTIONS.—This section shall not apply to 
any information which is required to be reported under sec-
tion 6050X.’’, and 
(C) by adding at the end of subsection (h), 
as so redesignated, the following new paragraph: 
‘‘(4) For provisions requiring reporting of infor-
mation relating to certain life insurance contract 
transactions, see section 6050X.’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall apply to— 
(1) reportable policy sales after December 31, 
2012, and 
(2) reportable death benefits paid after December 
31, 2012. 
SEC. 100113. CLARIFICATION OF TAX BASIS OF LIFE INSUR-
ANCE CONTRACTS. 
(a) CLARIFICATION
WITH
RESPECT
TO
ADJUST-
MENTS.—Paragraph (1) of section 1016(a) of the Internal 
Revenue Code of 1986 is amended by striking subparagraph 
(A) and all that follows and inserting the following: 
‘‘(A) for— 
‘‘(i) taxes or other carrying charges de-
scribed in section 266; or
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† HR 4348 EAS 
‘‘(ii) expenditures described in section 
173 (relating to circulation expenditures), 
for which deductions have been taken by the tax-
payer in determining taxable income for the tax-
able year or prior taxable years; or 
‘‘(B) for mortality, expense, or other reason-
able charges incurred under an annuity or life 
insurance contract;’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to transactions entered into after August 
25, 2009. 
SEC. 100114. EXCEPTION TO TRANSFER FOR VALUABLE 
CONSIDERATION RULES. 
(a) IN GENERAL.—Subsection (a) of section 101 of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following new paragraph: 
‘‘(3) EXCEPTION TO VALUABLE CONSIDERATION 
RULES FOR COMMERCIAL TRANSFERS.— 
‘‘(A) IN GENERAL.—The second sentence of 
paragraph (2) shall not apply in the case of a 
transfer of a life insurance contract, or any in-
terest therein, which is a reportable policy sale. 
‘‘(B) REPORTABLE POLICY SALE.—For pur-
poses of this paragraph, the term ‘reportable pol-
icy sale’ means the acquisition of an interest in
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† HR 4348 EAS 
a life insurance contract, directly or indirectly, 
if the acquirer has no substantial family, busi-
ness, or financial relationship with the insured 
apart from the acquirer’s interest in such life in-
surance contract. For purposes of the preceding 
sentence, the term ‘indirectly’ applies to the ac-
quisition of an interest in a partnership, trust, 
or other entity that holds an interest in the life 
insurance contract.’’. 
(b) CONFORMING AMENDMENT.—Paragraph (1) of sec-
tion 101(a) of the Internal Revenue Code of 1986 is amend-
ed by striking ‘‘paragraph (2)’’ and inserting ‘‘paragraphs 
(2) and (3)’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to transfers after December 31, 2012. 
SEC. 100115. PHASED RETIREMENT AUTHORITY. 
(a) CSRS.—Chapter 83 of title 5, United States Code, 
is amended— 
(1) in section 8331— 
(A) in paragraph (30) by striking ‘‘and’’ at 
the end; 
(B) in paragraph (31) by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(C) by adding at the end the following:
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† HR 4348 EAS 
‘‘(32) ‘Director’ means the Director of the Office 
of Personnel Management.’’; 
(2) by inserting after section 8336 the following: 
‘‘§ 8336a. Phased retirement 
‘‘(a) For the purposes of this section— 
‘‘(1) the term ‘composite retirement annuity’ 
means the annuity computed when a phased retiree 
attains full retirement status; 
‘‘(2) the term ‘full retirement status’ means that 
a phased retiree has ceased employment and is enti-
tled, upon application, to a composite retirement an-
nuity; 
‘‘(3) the term ‘phased employment’ means the 
less-than-full-time employment of a phased retiree; 
‘‘(4) the term ‘phased retiree’ means a retire-
ment-eligible employee who— 
‘‘(A) makes an election under subsection (b); 
and 
‘‘(B) has not entered full retirement status; 
‘‘(5) the term ‘phased retirement annuity’ means 
the annuity payable under this section before full re-
tirement; 
‘‘(6) the term ‘phased retirement percentage’ 
means the percentage which, when added to the work-
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† HR 4348 EAS 
ing percentage for a phased retiree, produces a sum 
of 100 percent; 
‘‘(7) the term ‘phased retirement period’ means 
the period beginning on the date on which an indi-
vidual becomes entitled to receive a phased retirement 
annuity and ending on the date on which the indi-
vidual dies or separates from phased employment; 
‘‘(8) the term ‘phased retirement status’ means 
that a phased retiree is concurrently employed in 
phased employment and eligible to receive a phased 
retirement annuity; 
‘‘(9) the term ‘retirement-eligible employee’— 
‘‘(A) means an individual who, if the indi-
vidual separated from the service, would meet the 
requirements for retirement under subsection (a) 
or (b) of section 8336; and 
‘‘(B) does not include— 
‘‘(i) an individual who, if the indi-
vidual separated from the service, would 
meet the requirements for retirement under 
subsection (c), (e), (m), or (n) of section 
8336; or 
‘‘(ii) a law enforcement officer, fire-
fighter, nuclear materials courier, air traffic 
controller, customs and border protection of-
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† HR 4348 EAS 
ficer, or member of the Capitol Police or 
Supreme Court Police; and 
‘‘(10) the term ‘working percentage’ means the 
percentage of full-time employment equal the quotient 
obtained by dividing— 
‘‘(A) the number of hours per pay period to 
be worked by a phased retiree as scheduled in ac-
cordance with subsection (b)(2); by 
‘‘(B) the number of hours per pay period to 
be worked by an employee serving in a com-
parable position on a full-time basis. 
‘‘(b)(1) With the concurrence of the head of the employ-
ing agency, and under regulations promulgated by the Di-
rector, a retirement-eligible employee who has been em-
ployed on a full time basis for not less than the 3-year pe-
riod ending on the date on which the retirement-eligible em-
ployee makes an election under this subsection may elect 
to enter phased retirement status. 
‘‘(2)(A) Subject to subparagraph (B), at the time of 
entering phased retirement status, a phased retiree shall be 
appointed to a position for which the working percentage 
is 50 percent. 
‘‘(B) The Director may, by regulation, provide for 
working percentages different from the percentage specified
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† HR 4348 EAS 
under subparagraph (A), which shall be not less than 20 
percent and not more than 80 percent. 
‘‘(C) The working percentage for a phased retiree may 
not be changed during the phased retiree’s phased retire-
ment period. 
‘‘(D)(i) Not less than 20 percent of the hours to be 
worked by a phased retiree shall consist of mentoring. 
‘‘(ii) The Director may, by regulation, provide for ex-
ceptions to the requirement under clause (i). 
‘‘(3) A phased retiree— 
‘‘(A) may not be employed in more than one po-
sition at any time; and 
‘‘(B) may transfer to another position in the 
same or a different agency, if the transfer does not re-
sult in a change in the working percentage. 
‘‘(4) A retirement-eligible employee may make only one 
election under this subsection during the retirement-eligible 
employee’s lifetime. 
‘‘(5) A retirement-eligible employee who makes an elec-
tion under this subsection may not make an election under 
section 8343a. 
‘‘(c)(1) Except as otherwise provided under this sub-
section, the phased retirement annuity for a phased retiree 
is the product obtained by multiplying—
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† HR 4348 EAS 
‘‘(A) the amount of an annuity computed under 
section 8339 that would have been payable to the 
phased retiree if, on the date on which the phased re-
tiree enters phased retirement status, the phased re-
tiree had separated from service and retired under 
section 8336(a) or (b); by 
‘‘(B) the phased retirement percentage for the 
phased retiree. 
‘‘(2) A phased retirement annuity shall be paid in ad-
dition to the basic pay for the position to which a phased 
retiree is appointed during phased employment. 
‘‘(3) A phased retirement annuity shall be adjusted in 
accordance with section 8340. 
‘‘(4)(A) A phased retirement annuity shall not be sub-
ject to reduction for any form of survivor annuity, shall 
not serve as the basis of the computation of any survivor 
annuity, and shall not be subject to any court order requir-
ing a survivor annuity to be provided to any individual. 
‘‘(B) A phased retirement annuity shall be subject to 
a court order providing for division, allotment, assignment, 
execution, levy, attachment, garnishment, or other legal 
process on the same basis as other annuities. 
‘‘(5) Any reduction of a phased retirement annuity 
based on an election under section 8334(d)(2) shall be ap-
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† HR 4348 EAS 
plied to the phased retirement annuity after computation 
under paragraph (1). 
‘‘(6)(A) Any deposit, or election of an actuarial annu-
ity reduction in lieu of a deposit, for military service or 
for creditable civilian service for which retirement deduc-
tions were not made or refunded shall be made by a retire-
ment-eligible employee at or before the time the retirement- 
eligible employee enters phased retirement status. No such 
deposit may be made, or actuarial adjustment in lieu there-
of elected, at the time a phased retiree enters full retirement 
status. 
‘‘(B) Notwithstanding subparagraph (A), if a phased 
retiree does not make such a deposit and dies in service 
as a phased retiree, a survivor of the phased retiree shall 
have the same right to make such deposit as would have 
been available had the employee not entered phased retire-
ment status and died in service. 
‘‘(C) If a phased retiree makes an election for an actu-
arial annuity reduction under section 8334(d)(2) and dies 
in service as a phased retiree, the amount of any deposit 
upon which such actuarial reduction shall have been based 
shall be deemed to have been fully paid. 
‘‘(7) A phased retirement annuity shall commence on 
the date on which a phased retiree enters phased employ-
ment.
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† HR 4348 EAS 
‘‘(8) No unused sick leave credit may be used in the 
computation of the phased retirement annuity. 
‘‘(d) All basic pay not in excess of the full-time rate 
of pay for the position to which a phased retiree is ap-
pointed shall be deemed to be basic pay for purposes of sec-
tion 8334. 
‘‘(e) Under such procedures as the Director may pre-
scribe, a phased retiree may elect to enter full retirement 
status at any time. Upon making such an election, a phased 
retiree shall be entitled to a composite retirement annuity. 
‘‘(f)(1) Except as provided otherwise under this sub-
section, a composite retirement annuity is a single annuity 
computed under regulations prescribed by the Director, 
equal to the sum of— 
‘‘(A) the amount of the phased retirement annu-
ity as of the date of full retirement, before any reduc-
tion based on an election under section 8334(d)(2), 
and including any adjustments made under section 
8340; and 
‘‘(B) the product obtained by multiplying— 
‘‘(i) the amount of an annuity computed 
under section 8339 that would have been payable 
at the time of full retirement if the individual 
had not elected a phased retirement and as if the 
individual was employed on a full-time basis in
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† HR 4348 EAS 
the position occupied during the phased retire-
ment period and before any reduction for sur-
vivor annuity or reduction based on an election 
under section 8334(d)(2); by 
‘‘(ii) the working percentage. 
‘‘(2) After computing a composite retirement annuity 
under paragraph (1), the Director shall adjust the amount 
of the annuity for any applicable reductions for a survivor 
annuity and any previously elected actuarial reduction 
under section 8334(d)(2). 
‘‘(3) A composite retirement annuity shall be adjusted 
in accordance with section 8340, except that subsection 
(c)(1) of that section shall not apply. 
‘‘(4) In computing a composite retirement annuity 
under paragraph (1)(B)(i), the unused sick leave to the 
credit of a phased retiree at the time of entry into full re-
tirement status shall be adjusted by dividing the number 
of hours of unused sick leave by the working percentage. 
‘‘(g)(1) Under such procedures and conditions as the 
Director may provide, and with the concurrence of the head 
of the employing agency, a phased retiree may elect to ter-
minate phased retirement status and return to a full-time 
work schedule.
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† HR 4348 EAS 
‘‘(2) Upon entering a full-time work schedule based 
upon an election under paragraph (1), the phased retire-
ment annuity of a phased retiree shall terminate. 
‘‘(3) After the termination of a phased retirement an-
nuity under this subsection, the individual’s rights under 
this subchapter shall be determined based on the law in ef-
fect at the time of any subsequent separation from service. 
For purposes of this subchapter or chapter 84, at time of 
the subsequent separation from service, the phased retire-
ment period shall be treated as if it had been a period of 
part-time employment with the work schedule described in 
subsection (b)(2). 
‘‘(h) For purposes of section 8341— 
‘‘(1) the death of a phased retiree shall be deemed 
to be the death in service of an employee; and 
‘‘(2) the phased retirement period shall be 
deemed to have been a period of part-time employ-
ment with the work schedule described in subsection 
(b)(2). 
‘‘(i) Employment of a phased retiree shall not be 
deemed to be part-time career employment, as defined in 
section 3401(2). 
‘‘(j) A phased retiree is not eligible to apply for an 
annuity under section 8337.
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† HR 4348 EAS 
‘‘(k) For purposes of section 8341(h)(4), retirement 
shall be deemed to occur on the date on which a phased 
retiree enters into full retirement status. 
‘‘(l) For purposes of sections 8343 and 8351, and sub-
chapter III of chapter 84, a phased retiree shall be deemed 
to be an employee. 
‘‘(m) A phased retiree is not subject to section 8344. 
‘‘(n) For purposes of chapter 87, a phased retiree shall 
be deemed to be receiving basic pay at the rate of a full- 
time employee in the position to which the phased retiree 
is appointed.’’; and 
(3) in the table of sections by inserting after the 
item relating to section 8336 the following: 
‘‘8336a. Phased retirement.’’. 
(b) FERS.—Chapter 84 of title 5, United States Code, 
is amended— 
(1) by inserting after section 8412 the following 
new section: 
‘‘§ 8412a. Phased retirement 
‘‘(a) For the purposes of this section— 
‘‘(1) the term ‘composite retirement annuity’ 
means the annuity computed when a phased retiree 
attains full retirement status; 
‘‘(2) the term ‘full retirement status’ means that 
a phased retiree has ceased employment and is enti-
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† HR 4348 EAS 
tled, upon application, to a composite retirement an-
nuity; 
‘‘(3) the term ‘phased employment’ means the 
less-than-full-time employment of a phased retiree; 
‘‘(4) the term ‘phased retiree’ means a retire-
ment-eligible employee who— 
‘‘(A) makes an election under subsection (b); 
and 
‘‘(B) has not entered full retirement status; 
‘‘(5) the term ‘phased retirement annuity’ means 
the annuity payable under this section before full re-
tirement; 
‘‘(6) the term ‘phased retirement percentage’ 
means the percentage which, when added to the work-
ing percentage for a phased retiree, produces a sum 
of 100 percent; 
‘‘(7) the term ‘phased retirement period’ means 
the period beginning on the date on which an indi-
vidual becomes entitled to receive a phased retirement 
annuity and ending on the date on which the indi-
vidual dies or separates from phased employment; 
‘‘(8) the term ‘phased retirement status’ means 
that a phased retiree is concurrently employed in 
phased employment and eligible to receive a phased 
retirement annuity;
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† HR 4348 EAS 
‘‘(9) the term ‘retirement-eligible employee’— 
‘‘(A) means an individual who, if the indi-
vidual separated from the service, would meet the 
requirements for retirement under subsection (a) 
or (b) of section 8412; and 
‘‘(B) does not include— 
‘‘(i) an individual who, if the indi-
vidual separated from the service, would 
meet the requirements for retirement under 
subsection (d) or (e) of section 8412; or 
‘‘(ii) a law enforcement officer, fire-
fighter, nuclear materials courier, air traffic 
controller, customs and border protection of-
ficer, or member of the Capitol Police or 
Supreme Court Police; and 
‘‘(10) the term ‘working percentage’ means the 
percentage of full-time employment equal to the 
quotient obtained by dividing— 
‘‘(A) the number of hours per pay period to 
be worked by a phased retiree as scheduled in ac-
cordance with subsection (b)(2); by 
‘‘(B) the number of hours per pay period to 
be worked by an employee serving in a com-
parable position on a full-time basis.
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† HR 4348 EAS 
‘‘(b)(1) With the concurrence of the head of the employ-
ing agency, and under regulations promulgated by the Di-
rector, a retirement-eligible employee who has been em-
ployed on a full time basis for not less than the 3-year pe-
riod ending on the date on which the retirement-eligible em-
ployee makes an election under this subsection may elect 
to enter phased retirement status. 
‘‘(2)(A) Subject to subparagraph (B), at the time of 
entering phased retirement status, a phased retiree shall be 
appointed to a position for which the working percentage 
is 50 percent. 
‘‘(B) The Director may, by regulation, provide for 
working percentages different from the percentage specified 
under subparagraph (A), which shall be not less than 20 
percent and not more than 80 percent. 
‘‘(C) The working percentage for a phased retiree may 
not be changed during the phased retiree’s phased retire-
ment period. 
‘‘(D)(i) Not less than 20 percent of the hours to be 
worked by a phased retiree shall consist of mentoring. 
‘‘(ii) The Director may, by regulation, provide for ex-
ceptions to the requirement under clause (i). 
‘‘(3) A phased retiree— 
‘‘(A) may not be employed in more than one po-
sition at any time; and
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† HR 4348 EAS 
‘‘(B) may transfer to another position in the 
same or a different agency, if the transfer does not re-
sult in a change in the working percentage. 
‘‘(4) A retirement-eligible employee may make only one 
election under this subsection during the retirement-eligible 
employee’s lifetime. 
‘‘(5) A retirement-eligible employee who makes an elec-
tion under this subsection may not make an election under 
section 8420a. 
‘‘(c)(1) Except as otherwise provided under this sub-
section, the phased retirement annuity for a phased retiree 
is the product obtained by multiplying— 
‘‘(A) the amount of an annuity computed under 
section 8415 that would have been payable to the 
phased retiree if, on the date on which the phased re-
tiree enters phased retirement status, the phased re-
tiree had separated from service and retired under 
section 8412 (a) or (b); by 
‘‘(B) the phased retirement percentage for the 
phased retiree. 
‘‘(2) A phased retirement annuity shall be paid in ad-
dition to the basic pay for the position to which a phased 
retiree is appointed during the phased employment. 
‘‘(3) A phased retirement annuity shall be adjusted in 
accordance with section 8462.
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† HR 4348 EAS 
‘‘(4)(A) A phased retirement annuity shall not be sub-
ject to reduction for any form of survivor annuity, shall 
not serve as the basis of the computation of any survivor 
annuity, and shall not be subject to any court order requir-
ing a survivor annuity to be provided to any individual. 
‘‘(B) A phased retirement annuity shall be subject to 
a court order providing for division, allotment, assignment, 
execution, levy, attachment, garnishment, or other legal 
process on the same basis as other annuities. 
‘‘(5)(A) Any deposit, or election of an actuarial annu-
ity reduction in lieu of a deposit, for military service or 
for creditable civilian service for which retirement deduc-
tions were not made or refunded, shall be made by a retire-
ment-eligible employee at or before the time the retirement- 
eligible employee enters phased retirement status. No such 
deposit may be made, or actuarial adjustment in lieu there-
of elected, at the time a phased retiree enters full retirement 
status. 
‘‘(B) Notwithstanding subparagraph (A), if a phased 
retiree does not make such a deposit and dies in service 
as a phased retiree, a survivor of the phased retiree shall 
have the same right to make such deposit as would have 
been available had the employee not entered phased retire-
ment status and died in service.
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† HR 4348 EAS 
‘‘(6) A phased retirement annuity shall commence on 
the date on which a phased retiree enters phased employ-
ment. 
‘‘(7) No unused sick leave credit may be used in the 
computation of the phased retirement annuity. 
‘‘(d) All basic pay not in excess of the full-time rate 
of pay for the position to which a phased retiree is ap-
pointed shall be deemed to be basic pay for purposes of sec-
tion 8422 and 8423. 
‘‘(e) Under such procedures as the Director may pre-
scribe, a phased retiree may elect to enter full retirement 
status at any time. Upon making such an election, a phased 
retiree shall be entitled to a composite retirement annuity. 
‘‘(f)(1) Except as provided otherwise under this sub-
section, a composite retirement annuity is a single annuity 
computed under regulations prescribed by the Director, 
equal to the sum of— 
‘‘(A) the amount of the phased retirement annu-
ity as of the date of full retirement, including any ad-
justments made under section 8462; and 
‘‘(B) the product obtained by multiplying— 
‘‘(i) the amount of an annuity computed 
under section 8412 that would have been payable 
at the time of full retirement if the individual 
had not elected a phased retirement and as if the
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† HR 4348 EAS 
individual was employed on a full-time basis in 
the position occupied during the phased retire-
ment period and before any adjustment to pro-
vide for a survivor annuity; by 
‘‘(ii) the working percentage; 
‘‘(2) After computing a composite retirement annuity 
under paragraph (1), the Director shall adjust the amount 
of the annuity for any applicable reductions for a survivor 
annuity. 
‘‘(3) A composite retirement annuity shall be adjusted 
in accordance with section 8462, except that subsection 
(c)(1) of that section shall not apply. 
‘‘(4) In computing a composite retirement annuity 
under paragraph (1)(B)(i), the unused sick leave to the 
credit of a phased retiree at the time of entry into full re-
tirement status shall be adjusted by dividing the number 
of hours of unused sick leave by the working percentage. 
‘‘(g)(1) Under such procedures and conditions as the 
Director may provide, and with the concurrence of the head 
of employing agency, a phased retiree may elect to termi-
nate phased retirement status and return to a full-time 
work schedule. 
‘‘(2) Upon entering a full-time work schedule based on 
an election under paragraph (1), the phased retirement an-
nuity of a phased retiree shall terminate.
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† HR 4348 EAS 
‘‘(3) After termination of the phased retirement annu-
ity under this subsection, the individual’s rights under this 
chapter shall be determined based on the law in effect at 
the time of any subsequent separation from service. For 
purposes of this chapter, at the time of the subsequent sepa-
ration from service, the phased retirement period shall be 
treated as if it had been a period of part-time employment 
with the work schedule described in subsection (b)(2). 
‘‘(h) For purposes of subchapter IV— 
‘‘(1) the death of a phased retiree shall be deemed 
to be the death in service of an employee; 
‘‘(2) 
except 
for 
purposes 
of 
section 
8442(b)(1)(A)(i), the phased retirement period shall 
be deemed to have been a period of part-time employ-
ment with the work schedule described in subsection 
(b)(2) of this section; and 
‘‘(3) for purposes of section 8442(b)(1)(A)(i), the 
phased retiree shall be deemed to have been at the full- 
time rate of pay for the position occupied. 
‘‘(i) Employment of a phased retiree shall not be 
deemed to be part-time career employment, as defined in 
section 3401(2). 
‘‘(j) A phased retiree is not eligible to receive an annu-
ity supplement under section 8421.
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† HR 4348 EAS 
‘‘(k) For purposes of subchapter III, a phased retiree 
shall be deemed to be an employee. 
‘‘(l) For purposes of section 8445(d), retirement shall 
be deemed to occur on the date on which a phased retiree 
enters into full retirement status. 
‘‘(m) A phased retiree is not eligible to apply for an 
annuity under subchapter V. 
‘‘(n) A phased retiree is not subject to section 8468. 
‘‘(o) For purposes of chapter 87, a phased retiree shall 
be deemed to be receiving basic pay at the rate of a full- 
time employee in the position to which the phased retiree 
is appointed.’’; and 
(2) in the table of sections by inserting after the 
item relating to section 8412 the following: 
‘‘8412a. Phased retirement.’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the effective date of the imple-
menting regulations issued by the Director of the Office of 
Personnel Management. 
SEC. 100116. ROLL-YOUR-OWN CIGARETTE MACHINES. 
(a) IN GENERAL.—Subsection (d) of section 5702 of 
the Internal Revenue Code of 1986 is amended by adding 
at the end the following new flush sentence: 
‘‘Such term shall include any person who for commercial 
purposes makes available for consumer use (including such 
consumer’s personal consumption or use under paragraph
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† HR 4348 EAS 
(1)) a machine capable of making cigarettes, cigars, or other 
tobacco products. A person making such a machine avail-
able for consumer use shall be deemed the person making 
the removal as defined by subsection (j) with respect to any 
tobacco products manufactured by such machine.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to articles removed after the date of the 
enactment of this Act. 
TITLE II—STOP TAX HAVEN 
ABUSE 
SEC. 100201. AUTHORIZING SPECIAL MEASURES AGAINST 
FOREIGN JURISDICTIONS, FINANCIAL INSTI-
TUTIONS, AND OTHERS THAT SIGNIFICANTLY 
IMPEDE UNITED STATES TAX ENFORCEMENT. 
Section 5318A of title 31, United States Code, is 
amended— 
(1) by striking the section heading and inserting 
the following: 
‘‘§ 5318A. Special measures for jurisdictions, financial 
institutions, or international transactions 
that are of primary money laundering 
concern or significantly impede United 
States tax enforcement’’; 
(2) in subsection (a), by striking the subsection 
heading and inserting the following:
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† HR 4348 EAS 
‘‘(a) SPECIAL MEASURES TO COUNTER MONEY LAUN-
DERING AND EFFORTS TO SIGNIFICANTLY IMPEDE UNITED 
STATES TAX ENFORCEMENT.—’’; 
(3) in subsection (c)— 
(A) by striking the subsection heading and 
inserting the following: 
‘‘(c) CONSULTATIONS AND INFORMATION TO BE CON-
SIDERED
IN
FINDING
JURISDICTIONS, INSTITUTIONS, 
TYPES OF ACCOUNTS, OR TRANSACTIONS TO BE OF PRI-
MARY MONEY LAUNDERING CONCERN OR TO BE SIGNIFI-
CANTLY IMPEDING UNITED STATES TAX ENFORCEMENT.— 
’’; and 
(B) by inserting at the end of paragraph 
(2) thereof the following new subparagraph: 
‘‘(C) OTHER
CONSIDERATIONS.—The fact 
that a jurisdiction or financial institution is co-
operating with the United States on imple-
menting the requirements specified in chapter 4 
of the Internal Revenue Code of 1986 may be fa-
vorably considered in evaluating whether such 
jurisdiction or financial institution is signifi-
cantly impeding United States tax enforce-
ment.’’;
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† HR 4348 EAS 
(4) in subsection (a)(1), by inserting ‘‘or is sig-
nificantly impeding United States tax enforcement’’ 
after ‘‘primary money laundering concern’’; 
(5) in subsection (a)(4)— 
(A) in subparagraph (A)— 
(i) by inserting ‘‘in matters involving 
money laundering,’’ before ‘‘shall consult’’; 
and 
(ii) by striking ‘‘and’’ at the end; 
(B) by redesignating subparagraph (B) as 
subparagraph (C); and 
(C) by inserting after subparagraph (A) the 
following: 
‘‘(B) in matters involving United States tax 
enforcement, shall consult with the Commissioner 
of the Internal Revenue, the Secretary of State, 
the Attorney General of the United States, and 
in the sole discretion of the Secretary, such other 
agencies and interested parties as the Secretary 
may find to be appropriate; and’’; 
(6) in each of paragraphs (1)(A), (2), (3), and 
(4) of subsection (b), by inserting ‘‘or to be signifi-
cantly impeding United States tax enforcement’’ after 
‘‘primary money laundering concern’’ each place that 
term appears;
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† HR 4348 EAS 
(7) in subsection (b), by striking paragraph (5) 
and inserting the following: 
‘‘(5) PROHIBITIONS OR CONDITIONS ON OPENING 
OR MAINTAINING CERTAIN CORRESPONDENT OR PAY-
ABLE-THROUGH ACCOUNTS OR AUTHORIZING CERTAIN 
PAYMENT CARDS.—If the Secretary finds a jurisdic-
tion outside of the United States, 1 or more financial 
institutions operating outside of the United States, or 
1 or more classes of transactions within or involving 
a jurisdiction outside of the United States to be of 
primary money laundering concern or to be signifi-
cantly impeding United States tax enforcement, the 
Secretary, in consultation with the Secretary of State, 
the Attorney General of the United States, and the 
Chairman of the Board of Governors of the Federal 
Reserve System, may prohibit, or impose conditions 
upon— 
‘‘(A) the opening or maintaining in the 
United States of a correspondent account or pay-
able-through account; or 
‘‘(B) the authorization, approval, or use in 
the United States of a credit card, charge card, 
debit card, or similar credit or debit financial 
instrument by any domestic financial institu-
tion, financial agency, or credit card company
1612 
† HR 4348 EAS 
or association, for or on behalf of a foreign bank-
ing institution, if such correspondent account, 
payable-through account, credit card, charge 
card, debit card, or similar credit or debit finan-
cial instrument, involves any such jurisdiction 
or institution, or if any such transaction may be 
conducted through such correspondent account, 
payable-through account, credit card, charge 
card, debit card, or similar credit or debit finan-
cial instrument.’’; and 
(8) in subsection (c)(1), by inserting ‘‘or is sig-
nificantly impeding United States tax enforcement’’ 
after ‘‘primary money laundering concern’’; 
(9) in subsection (c)(2)(A)— 
(A) in clause (ii), by striking ‘‘bank secrecy 
or special regulatory advantages’’ and inserting 
‘‘bank, tax, corporate, trust, or financial secrecy 
or regulatory advantages’’; 
(B) in clause (iii), by striking ‘‘supervisory 
and counter-money’’ and inserting ‘‘supervisory, 
international tax enforcement, and counter- 
money’’; 
(C) in clause (v), by striking ‘‘banking or 
secrecy’’ and inserting ‘‘banking, tax, or se-
crecy’’; and
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† HR 4348 EAS 
(D) in clause (vi), by inserting ‘‘, tax trea-
ty, or tax information exchange agreement’’ after 
‘‘treaty’’; 
(10) in subsection (c)(2)(B)— 
(A) in clause (i), by inserting ‘‘or tax eva-
sion’’ after ‘‘money laundering’’; and 
(B) in clause (iii), by inserting ‘‘, tax eva-
sion,’’ after ‘‘money laundering’’; and 
(11) in subsection (d), by inserting ‘‘involving 
money laundering, and shall notify, in writing, the 
Committee on Finance of the Senate and the Com-
mittee on Ways and Means of the House of Represent-
atives of any such action involving United States tax 
enforcement’’ after ‘‘such action’’. 
DIVISION G—AIR 
TRANSPORTATION 
SEC. 100301. TECHNICAL CORRECTIONS RELATING TO 
OVERFLIGHTS OF NATIONAL PARKS. 
(a) IN GENERAL.—Section 40128 of title 49, United 
States Code, is amended to read as follows: 
‘‘§ 40128. Overflights of national parks 
‘‘(a) IN GENERAL.— 
‘‘(1) GENERAL DELINEATION OF RESPONSIBIL-
ITIES.—
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† HR 4348 EAS 
‘‘(A) AUTHORITY OF DIRECTOR.—The Di-
rector has the authority to establish air tour 
management plans, issue air tour permits for 
commercial air tour operations conducted in ac-
cordance with an air tour management plan, 
enter into a voluntary agreement with a com-
mercial air tour operator, and issue interim op-
erating permits under subsection (c). 
‘‘(B) AUTHORITY OF ADMINISTRATOR.—The 
Administrator has the authority to ensure that 
any action taken under this section does not ad-
versely affect aviation safety or the management 
of the national airspace system. 
‘‘(2) GENERAL REQUIREMENTS.—A commercial 
air tour operator may not conduct commercial air 
tour operations over a national park or tribal lands, 
as defined by this section, except— 
‘‘(A) in accordance with this section; 
‘‘(B) in accordance with conditions and 
limitations prescribed for that operator; and 
‘‘(C) in accordance with any applicable air 
tour management plan or voluntary agreement 
developed under subsection (b) for the park or 
tribal lands.
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† HR 4348 EAS 
‘‘(3) APPLICATION
FOR
OPERATING
AUTHOR-
ITY.— 
‘‘(A) APPLICATION REQUIRED.—Before com-
mencing commercial air tour operations over a 
national park or tribal lands, a commercial air 
tour operator shall apply to the Director for au-
thority to conduct the operations over the park 
or tribal lands. 
‘‘(B) NUMBER
OF
OPERATIONS
AUTHOR-
IZED.—In determining the number of authoriza-
tions to issue to provide commercial air tour op-
erations over a national park, the Director shall 
take into consideration the provisions of the air 
tour management plan, the number of existing 
commercial air tour operators and current level 
of service and equipment provided by any such 
operators, and the financial viability of each 
commercial air tour operation. 
‘‘(C) CONSULTATION
WITH
FAA.—Before 
granting an application under this paragraph, 
the Director, in consultation with the Adminis-
trator, shall develop an air tour management 
plan in accordance with subsection (b) and im-
plement such plan.
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† HR 4348 EAS 
‘‘(D) TIME LIMIT ON RESPONSE TO ATMP 
APPLICATIONS.—The Director shall make every 
effort to act on any application under this para-
graph and issue a decision on the application 
not later than 24 months after it is received or 
amended. 
‘‘(E) PRIORITY.—In acting on applications 
under this paragraph to provide commercial air 
tour operations over a national park, the Direc-
tor shall give priority to an application under 
this paragraph in any case in which a new en-
trant commercial air tour operator is seeking op-
erating authority with respect to that national 
park. 
‘‘(4) EXCEPTION.—Notwithstanding paragraph 
(2), commercial air tour operators may conduct com-
mercial air tour operations over a national park 
under part 91 of the title 14, Code of Federal Regula-
tions, if— 
‘‘(A) such activity is permitted under part 
119 of such title; 
‘‘(B) the total number of operations under 
this exception is limited to not more than five 
flights in any 30-day period over a particular 
park; and
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† HR 4348 EAS 
‘‘(C) the operator complies with the condi-
tions under which the operations will be con-
ducted as established by the Director, in con-
sultation with the Administrator. 
‘‘(5) SPECIAL
RULE
FOR
SAFETY
REQUIRE-
MENTS.—Before receiving a permit issued under this 
section, a commercial air tour operator shall have ob-
tained the appropriate operating authority as re-
quired by the Administrator under part 119, 121, or 
135 of title 14, Code of Federal Regulations, to con-
duct operations under this section. 
‘‘(6) EXEMPTION FOR NATIONAL PARKS WITH 50 
OR FEWER FLIGHTS EACH YEAR.— 
‘‘(A) IN GENERAL.—A national park that 
has 50 or fewer commercial air tour operations 
over the park each year shall be exempt from the 
requirements of this section, except as provided 
in subparagraph (B). 
‘‘(B) WITHDRAWAL OF EXEMPTION.—If the 
Director determines that an air tour manage-
ment plan or voluntary agreement is necessary 
to protect park resources and values or park vis-
itor use and enjoyment, the Director shall with-
draw the exemption of a park under subpara-
graph (A).
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† HR 4348 EAS 
‘‘(C) LIST OF PARKS.—The Director shall 
maintain a list each year of national parks that 
are covered by the exemption provided under this 
paragraph. 
‘‘(b) AIR TOUR MANAGEMENT PLANS.— 
‘‘(1) ESTABLISHMENT.— 
‘‘(A) IN GENERAL.—The Director, in con-
sultation with the Administrator, shall establish 
an air tour management plan for any national 
park or tribal land for which such a plan is not 
in effect whenever a person applies for authority 
to conduct a commercial air tour operation over 
the park. The air tour management plan shall be 
developed by means of a public process in ac-
cordance with paragraph (4). 
‘‘(B) OBJECTIVE.—The objective of any air 
tour management plan shall be to develop accept-
able and effective measures to mitigate or pre-
vent the significant adverse impacts, if any, of 
commercial air tour operations upon the natural 
and cultural resources, visitor experiences, and 
tribal lands. 
‘‘(C) EXCEPTION.—An application to begin 
commercial air tour operations at Crater Lake 
National Park may be denied without the estab-
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† HR 4348 EAS 
lishment of an air tour management plan by the 
Director of the National Park Service if the Di-
rector determines that such operations would ad-
versely affect park resources or visitor experi-
ences. 
‘‘(2) ENVIRONMENTAL DETERMINATION.—In es-
tablishing an air tour management plan and issuing 
a permit for a commercial air tour operator under 
this section, the Director shall comply with the Na-
tional Environmental Policy Act of 1969 (42 U.S.C. 
4321 et seq.). Any environmental thresholds, analyses, 
impact determinations, and conditions prepared or 
used by the Director to establish an air tour manage-
ment plan or issue a permit under this section shall 
have no broader application or be given deference be-
yond this section. 
‘‘(3) CONTENTS.—An air tour management plan 
for a national park— 
‘‘(A) may prohibit commercial air tour op-
erations over a national park in whole or in 
part; 
‘‘(B) may establish conditions for the con-
duct of commercial air tour operations over a 
national park, including commercial air tour 
routes, maximum or minimum altitudes, time-
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† HR 4348 EAS 
of-day restrictions, restrictions for particular 
events, maximum number of flights per unit of 
time, intrusions on privacy on tribal lands, and 
mitigation of noise, visual, or other impacts; 
‘‘(C) shall apply to all commercial air tour 
operations over a national park that are also 
within 1⁄2 mile outside the boundary of a na-
tional park; 
‘‘(D) shall include incentives (such as pre-
ferred commercial air tour routes and altitudes, 
relief from caps and curfews) for the adoption of 
quiet aircraft technology by commercial air tour 
operators conducting commercial air tour oper-
ations over a national park when practicable; 
‘‘(E) shall provide for the initial allocation 
of opportunities to conduct commercial air tour 
operations over a national park if the plan in-
cludes a limitation on the number of commercial 
air tour operations for any time period; 
‘‘(F) may not have been found to have ad-
verse effects on aviation safety or the manage-
ment of the national airspace system by the Ad-
ministrator; and
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† HR 4348 EAS 
‘‘(G) shall justify and document the need for 
measures taken pursuant to subparagraphs (A) 
through (F). 
‘‘(4) PROCEDURE.—In establishing an air tour 
management plan for a national park or tribal lands, 
the Director shall— 
‘‘(A) hold at least one public meeting with 
interested parties to develop the air tour man-
agement plan; 
‘‘(B) publish a notice of availability of the 
proposed plan in the Federal Register for notice 
and comment and make copies of the proposed 
plan available to the public; 
‘‘(C) comply with the regulations set forth 
in parts 1500 through 1508 of title 40, Code of 
Federal Regulations; 
‘‘(D) solicit the participation of any Indian 
tribe whose tribal lands are, or may be, 
overflown by aircraft involved in a commercial 
air tour operation over the park or tribal lands 
to which the plan applies, as a cooperating agen-
cy under the regulations referred to in subpara-
graph (C); and
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† HR 4348 EAS 
‘‘(E) consult with the Administrator with 
respect to effects on aviation safety and the man-
agement of the national airspace system. 
‘‘(5) JUDICIAL REVIEW.—An air tour manage-
ment plan developed under this subsection shall be 
subject to judicial review pursuant to chapter 7 of 
title 5, United States Code. 
‘‘(6) AMENDMENTS AND REVOCATIONS.—The Di-
rector may make amendments to an air tour manage-
ment plan and any permits issued pursuant to an air 
tour management plan, and may revoke permits. The 
Director shall consult with the Administrator to en-
sure that any such amendments or revocations will 
not adversely affect aviation safety or the manage-
ment of the national airspace system. Any such 
amendments and revocations shall be published in the 
Federal Register for notice and comment. A request 
for amendment of an air tour management plan or 
permit shall be made in such form and manner as the 
Director may prescribe. 
‘‘(7) VOLUNTARY AGREEMENTS.— 
‘‘(A) IN GENERAL.—As an alternative to an 
air tour management plan, the Director may 
enter into a voluntary agreement with a com-
mercial air tour operator (including a new en-
1623 
† HR 4348 EAS 
trant commercial air tour operator and an oper-
ator that has an interim operating permit) that 
has applied to conduct commercial air tour oper-
ations over a national park to manage commer-
cial air tour operations over such national park. 
‘‘(B) 
PARK
PROTECTION.—A 
voluntary 
agreement entered into under subparagraph (A) 
shall protect the national park resources, values, 
and visitor experience without compromising 
aviation safety or the management of the na-
tional airspace system and may— 
‘‘(i) include provisions such as those 
included in the content of an air tour man-
agement plan; 
‘‘(ii) include provisions to ensure the 
stability of, and compliance with, the vol-
untary agreement; and 
‘‘(iii) provide for fees for such oper-
ations. 
‘‘(C) PUBLIC REVIEW.—The Director shall 
provide an opportunity for public review of a 
proposed voluntary agreement under this para-
graph and shall consult with any Indian tribe 
whose tribal lands are, or may be, flown over by 
a commercial air tour operator under a vol-
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† HR 4348 EAS 
untary agreement under this paragraph. After 
such opportunity for public review and consulta-
tion, the voluntary agreement may be imple-
mented without further administrative or envi-
ronmental process beyond that described in this 
subsection. 
‘‘(D) TERMINATION.— 
‘‘(i) IN GENERAL.—A voluntary agree-
ment under this paragraph may be termi-
nated at any time at the discretion of— 
‘‘(I) the Director, if the Director 
determines that the agreement is not 
adequately protecting park resources or 
visitor experiences; or 
‘‘(II) the Administrator, if the 
Administrator 
determines 
that 
the 
agreement is adversely affecting avia-
tion safety or the national airspace 
system. 
‘‘(ii) EFFECT OF TERMINATION.—If a 
voluntary agreement with respect to a na-
tional park is terminated under this sub-
paragraph, the operators shall conform to 
the requirements for an interim operating 
permit under subsection (c) until an air
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† HR 4348 EAS 
tour management plan for the park is in ef-
fect. 
‘‘(c) INTERIM OPERATING AUTHORITY.— 
‘‘(1) IN GENERAL.—Interim operating authority 
granted by the Administrator under this subsection, 
as in effect on the day before the date of the enact-
ment of the Moving Ahead for Progress in the 21st 
Century Act, shall, on and after such date of enact-
ment, be known as an interim operating permit and 
be administered by the Director in accordance with 
the conditions of this subsection. 
‘‘(2) REQUIREMENTS AND LIMITATIONS.—An in-
terim operating permit— 
‘‘(A) shall maintain the same annual au-
thorizations as provided for interim operating 
authority under this subsection, as in effect on 
the day before the date of the enactment of the 
Moving Ahead for Progress in the 21st Century 
Act; and 
‘‘(B) may not provide for an increase in the 
number of commercial air tour operations over a 
national park conducted during any time period 
by the commercial air tour operator above the 
number that the air tour operator was granted
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† HR 4348 EAS 
unless such an increase is approved by the Direc-
tor in consultation with the Administrator; 
‘‘(C) may be revoked by the Director for 
cause; 
‘‘(D) shall terminate 180 days after the date 
on which an air tour management plan is estab-
lished for the park or tribal lands; 
‘‘(E) shall promote protection of national 
park resources, visitor experiences, and tribal 
lands; 
‘‘(F) shall promote safe commercial air tour 
operations; 
‘‘(G) shall promote the adoption of quiet 
technology, as appropriate; and 
‘‘(H) may allow for modifications of the in-
terim operating permit without further environ-
mental review beyond that described in this sub-
section, if— 
‘‘(i) adequate information regarding 
the existing and proposed operations of the 
operator under the interim operating per-
mit is provided to the Director; 
‘‘(ii) the Director agrees with the modi-
fication, based on the professional expertise 
of the Director regarding the protection of
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† HR 4348 EAS 
the resources, values, and visitor use and 
enjoyment of the park; and 
‘‘(iii) the Director receives advice in 
writing from the Administrator that there 
would be no adverse impact on aviation 
safety or the national airspace system. 
‘‘(3) MODIFICATIONS
AND
REVOCATIONS.—Any 
modification or revocation of an interim operating 
permit shall be published in the Federal Register to 
provide notice and opportunity for comment. 
‘‘(4) NEW ENTRANT AIR TOUR OPERATORS.— 
‘‘(A) IN GENERAL.—The Director, in con-
sultation with the Administrator, may grant an 
interim operating permit under this paragraph 
to an air tour operator for a national park or 
tribal lands for which that operator is a new en-
trant air tour operator without further environ-
mental process beyond that described in this 
paragraph, if— 
‘‘(i) adequate information on the pro-
posed operations of the operator is provided 
to the Director by the operator making the 
request; 
‘‘(ii) the Director agrees, based on the 
Director’s professional expertise regarding
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† HR 4348 EAS 
the protection of park resources and values 
and visitor use and enjoyment; and 
‘‘(iii) the Director receives advice in 
writing from the Administrator that there 
would be no adverse impact on aviation 
safety or the national airspace system. 
‘‘(B) SAFETY
LIMITATION.—The Director 
may not grant an interim operating permit 
under subparagraph (A) if the Administrator de-
termines that it would create a safety problem at 
the park or on the tribal lands, or the Director 
determines that it would create a noise problem 
at the park or on the tribal lands. 
‘‘(d) COMMERCIAL AIR TOUR OPERATOR REPORTS.— 
‘‘(1) REPORT.—Each commercial air tour oper-
ator conducting a commercial air tour operation over 
a national park under an interim operating permit 
granted under subsection (c) or in accordance with an 
air tour management plan or voluntary agreement 
under subsection (b) shall submit to the Director a re-
port regarding the number of commercial air tour op-
erations over each national park that are conducted 
by the operator and such other information as the Di-
rector may request in order to facilitate admin-
istering the provisions of this section.
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† HR 4348 EAS 
‘‘(2) REPORT SUBMISSION.—The Director shall 
issue a request for reports under this subsection. The 
reports shall be submitted to the Director with a fre-
quency and in a format prescribed by the Director. 
‘‘(e) COLLECTION OF FEES FROM AIR TOUR OPER-
ATIONS.— 
‘‘(1) IN GENERAL.—The Director shall determine 
and assess a fee under paragraph (2) on a commer-
cial air tour operator conducting commercial air tour 
operations over a national park, including the Grand 
Canyon National Park. 
‘‘(2) AMOUNT
OF
FEE.—In determining the 
amount of the fee assessed under paragraph (1), the 
Director shall collect sufficient revenue, in the aggre-
gate, to pay for the expenses incurred by the Federal 
Government to develop and enforce air tour manage-
ment plans for national parks. 
‘‘(3) EFFECT OF FAILURE TO PAY FEE.—The Di-
rector may assess a civil penalty against or revoke the 
interim operating permit or air tour permit, which-
ever is applicable, of a commercial air tour operator 
conducting commercial air tour operations over any 
national park, including the Grand Canyon National 
Park, that has not paid the fee assessed by the Direc-
tor under paragraph (1) by the date that is 180 days
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† HR 4348 EAS 
after the date on which the Director determines the fee 
shall be paid. 
‘‘(4) FUNDING
FOR
AIR
TOUR
MANAGEMENT 
PLANS.—The Director shall use the amounts collected 
to develop and enforce air tour management plans for 
the national parks the Director determines would 
most benefit from such a plan. 
‘‘(f) CIVIL PENALTIES.— 
‘‘(1) IN GENERAL.—Any person who violates any 
provision of this section or any regulation or permit 
issued under this section may be assessed a civil pen-
alty by the Director of not more than $25,000 for 
each such violation. 
‘‘(2) KNOWING
VIOLATIONS.—Any person who 
knowingly violates any provision of this section or 
any regulation or permit issued under this section 
may be assessed a civil penalty by the Director of not 
more than $50,000 for each violation. 
‘‘(3) PROCEDURES.—A penalty may not be as-
sessed under this subsection on a person unless the 
person is given notice and opportunity for a hearing 
with respect to the violation for which the penalty is 
assessed. Each violation of this section or a regulation 
or permit issued under this section shall be a separate 
offense. Any civil penalty assessed under this sub-
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† HR 4348 EAS 
section may be remitted or mitigated by the Director. 
Upon any failure by a person to pay a penalty as-
sessed under this subsection, the Director may request 
the Attorney General to institute a civil action in a 
district court of the United States for any district in 
which the person is found, resides, or transacts busi-
ness to collect the penalty and such court shall have 
jurisdiction to hear and decide any such action. The 
court shall hear such action on the record made before 
the Director and shall sustain his action if it is sup-
ported by substantial evidence on the record consid-
ered as a whole. 
‘‘(4) ADMINISTRATIVE PROCEEDINGS.—Hearings 
held during proceedings for the assessment of civil 
penalties under this subsection shall be conducted in 
accordance with section 554 of title 5, United States 
Code. The Director may issue subpoenas for the at-
tendance and testimony of witnesses and the produc-
tion of relevant papers, books, and documents, and 
administer oaths. Witnesses summoned shall be paid 
the same fees and mileage that are paid to witnesses 
in the courts of the United States. In case of contu-
macy or refusal to obey a subpoena served upon any 
person pursuant to this paragraph, the district court 
of the United States for any district in which such
1632 
† HR 4348 EAS 
person is found or resides or transacts business, upon 
application by the United States and after notice to 
the person, shall have jurisdiction to issue an order 
requiring the person to appear and give testimony be-
fore the Director or to appear and produce documents 
before the Director, or both, and any failure to obey 
the order of the court may be punished by such court 
as a contempt thereof. 
‘‘(g) ENFORCEMENT.—The provisions of this section 
and any regulations or permits issued under this section 
may be enforced by the Director or the Administrator, as 
appropriate. The Director may utilize by agreement, with 
or without reimbursement, the personnel, services, and fa-
cilities of any other Federal agency or any State agency 
for purposes of enforcing this section. The decisions of the 
Director under this subsection shall not have broader appli-
cation or be given deference beyond this section. The Admin-
istrator shall retain enforcement authority over matters in-
volving the safety and efficiency of the national airspace 
system. 
‘‘(h) EXEMPTIONS.—This section shall not apply to— 
‘‘(1) the Grand Canyon National Park; or 
‘‘(2) tribal lands within or abutting the Grand 
Canyon National Park.
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† HR 4348 EAS 
‘‘(i) LAKE MEAD.—This section shall not apply to any 
air tour operator while flying over or near the Lake Mead 
National Recreation Area, solely as a transportation route, 
to conduct an air tour over the Grand Canyon National 
Park. For purposes of this subsection, an air tour operator 
flying over the Hoover Dam in the Lake Mead National 
Recreation Area en route to the Grand Canyon National 
Park shall be deemed to be flying solely as a transportation 
route. 
‘‘(j) SEVERABLE SERVICES CONTRACTS FOR PERIODS 
CROSSING FISCAL YEARS.— 
‘‘(1) IN GENERAL.—For purposes of this section, 
the Director may enter into a contract for procure-
ment of severable services for a period that begins 
during one fiscal year and ends in the next fiscal 
year if (without regard to any option to extend the 
period of the contract) the period of the contract does 
not exceed 1 year. 
‘‘(2) OBLIGATION
OF
FUNDS.—Funds made 
available for a fiscal year may be obligated for the 
total amount of a contract entered into under the au-
thority of paragraph (1). 
‘‘(k) RESPONSIBILITIES AND AUTHORITIES OF ADMIN-
ISTRATOR.—
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† HR 4348 EAS 
‘‘(1) IN GENERAL.—The Administrator shall ad-
vise the Director in writing of any adverse effects on 
aviation safety and or management of the national 
airspace system for any proposed action taken under 
this section. 
‘‘(2) AMENDMENTS TO AUTHORIZATION FOR COM-
MERCIAL AIR TOUR OPERATORS.—The Administrator, 
in consultation with the Director, may amend any 
authorization for a commercial air tour operator to 
include conditions set forth in any permit issued 
under this section or to address any adverse effect on 
aviation safety. 
‘‘(3) RULE OF CONSTRUCTION.—Nothing in this 
section shall be construed to limit or abrogate the Ad-
ministrator’s authority to ensure the safety and effi-
ciency of the national airspace system. 
‘‘(l) DEFINITIONS.—In this section, the following defi-
nitions apply: 
‘‘(1) COMMERCIAL
AIR
TOUR
OPERATOR.—The 
term ‘commercial air tour operator’ means any per-
son who conducts a commercial air tour operation 
over a national park. 
‘‘(2) EXISTING
COMMERCIAL
AIR
TOUR
OPER-
ATOR.—The term ‘existing commercial air tour oper-
ator’ means a commercial air tour operator that was
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† HR 4348 EAS 
actively engaged in the business of providing commer-
cial air tour operations over a national park at any 
time during the 12-month period ending on the date 
of the enactment of this section. 
‘‘(3) NEW ENTRANT COMMERCIAL AIR TOUR OP-
ERATOR.—The term ‘new entrant commercial air tour 
operator’ means a commercial air tour operator 
that— 
‘‘(A) applies for an interim operating per-
mit or air tour permit as a commercial air tour 
operator for a national park or tribal lands; and 
‘‘(B) has not engaged in the business of pro-
viding commercial air tour operations over the 
national park or tribal lands in the 12-month 
period preceding the application. 
‘‘(4) COMMERCIAL AIR TOUR OPERATION OVER A 
NATIONAL PARK.— 
‘‘(A) IN GENERAL.—The term ‘commercial 
air tour operation over a national park’ means 
any flight, conducted for compensation or hire in 
a powered aircraft where a purpose of the flight 
is sightseeing over a national park, within 1⁄2 
mile outside the boundary of any national park 
(except the Grand Canyon National Park), or 
over tribal lands (except those within or abutting
1636 
† HR 4348 EAS 
the Grand Canyon National Park), during which 
the aircraft flies— 
‘‘(i) below a minimum altitude, deter-
mined by the Administrator in cooperation 
with the Director, above ground level (except 
solely for purposes of takeoff or landing, or 
necessary for safe operation of an aircraft 
as determined under the rules and regula-
tions of the Federal Aviation Administra-
tion requiring the pilot-in-command to take 
action to ensure the safe operation of the 
aircraft); or 
‘‘(ii) less than 1 mile laterally from 
any geographic feature within the park (un-
less more than 1⁄2 mile outside the bound-
ary). 
‘‘(B) FACTORS TO CONSIDER.—In making a 
determination of whether a flight is a commer-
cial air tour operation over a national park for 
purposes of this section, the Administrator may 
consider— 
‘‘(i) whether there was a holding out to 
the public of willingness to conduct a sight-
seeing flight for compensation or hire;
1637 
† HR 4348 EAS 
‘‘(ii) whether a narrative that referred 
to areas or points of interest on the surface 
below the route of the flight was provided by 
the person offering the flight; 
‘‘(iii) the area of operation; 
‘‘(iv) the frequency of flights conducted 
by the person offering the flight; 
‘‘(v) the route of flight; 
‘‘(vi) the inclusion of sightseeing flights 
as part of any travel arrangement package 
offered by the person offering the flight; 
‘‘(vii) whether the flight would have 
been canceled based on poor visibility of the 
surface below the route of the flight; and 
‘‘(viii) any other factors that the Ad-
ministrator and the Director consider ap-
propriate. 
‘‘(5) NATIONAL PARK.—The term ‘national park’ 
means any unit of the National Park System. 
‘‘(6) TRIBAL LANDS.— 
‘‘(A) IN GENERAL.—The term ‘tribal lands’ 
means Indian country (as that term is defined 
in section 1151 of title 18) that is within or 
abutting a national park.
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† HR 4348 EAS 
‘‘(B) ABUTTING.—For purposes of subpara-
graph (A), the term ‘abutting’ means lands with-
in 1⁄2 mile outside the boundary of a national 
park. 
‘‘(7) 
ADMINISTRATOR.—The 
term 
‘Adminis-
trator’ means the Administrator of the Federal Avia-
tion Administration. 
‘‘(8) DIRECTOR.—The term ‘Director’ means the 
Director of the National Park Service. 
‘‘(9) AIR TOUR PERMIT.—The term ‘air tour per-
mit’ means a permit issued by the Director, in ac-
cordance with this section, to a commercial operator 
to conduct commercial air tour operations over a na-
tional park or tribal lands.’’. 
(b) AMENDMENTS TO NATIONAL PARKS AIR TOUR 
MANAGEMENT ACT OF 2000.— 
(1) ADVISORY GROUP.—Section 805 of the Na-
tional Parks Air Tour Management Act of 2000 (49 
U.S.C. 40128 note) is amended— 
(A) by striking subsection (a) and inserting 
the following: 
‘‘(a) IN GENERAL.—The Director of the National Park 
Service may retain the advisory group established pursuant 
to this section, as in effect on the day before the date of 
the enactment of the Moving Ahead for Progress in the 21st
1639 
† HR 4348 EAS 
Century Act, to provide continuing advice and counsel with 
respect to commercial air tour operations over and near na-
tional parks.’’; 
(B) in subsection (b)— 
(i) in paragraph (1)(A)(iv), by insert-
ing ‘‘or Native Hawaiians’’ after ‘‘Indian 
tribes’’; and 
(ii) by striking paragraph (3) and in-
serting the following: 
‘‘(3) CHAIRPERSON.—The representative of the 
National Park Service shall serve as chairperson of 
the advisory group.’’; and 
(C) in subsection (d)(2), by striking ‘‘The 
Federal Aviation Administration and the Na-
tional Park Service shall jointly’’ and inserting 
‘‘The National Park Service shall’’. 
(2) REPORTS.—Section 807 of the National 
Parks Air Tour Management Act of 2000 (49 U.S.C. 
40128 note) is repealed. 
(3) METHODOLOGIES USED TO ASSESS AIR TOUR 
NOISE.—Section 808 of the National Parks Air Tour 
Management Act of 2000 (49 U.S.C. 40128 note) is 
amended by striking ‘‘a Federal agency’’ and insert-
ing ‘‘the Director of the National Park Service’’.
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† HR 4348 EAS 
DIVISION H—BUDGETARY 
EFFECTS 
SEC. 100401. BUDGETARY EFFECTS. 
(a) PAYGO SCORECARD.—The budgetary effects of 
this Act shall not be entered on either PAYGO scorecard 
maintained pursuant to section 4(d) of the Statutory Pay- 
As-You-Go Act of 2010. 
(b) SENATE PAYGO SCORECARD.—The budgetary ef-
fects of this Act shall not be recorded on any PAYGO score-
card maintained for purposes of section 201 of S. Con. Res. 
21 (110th Congress). 
Attest: 
Secretary.