‘‘(B) DEDICATED BOND PORTFOLIO.—The 
Secretary may by regulations provide that the 
value of any dedicated bond portfolio of a plan 
shall be determined by using the interest rate 
under section 412(b)(5) (as in effect on the day 
before the enactment of the Pension Protection 
Act of 2006). 
‘‘(3) ACTUARIAL ASSUMPTIONS MUST BE REA-
SONABLE.—For purposes of this section, all costs, li-
abilities, rates of interest, and other factors under 
the plan shall be determined on the basis of actu-
arial assumptions and methods— 
‘‘(A) each of which is reasonable (taking 
into account the experience of the plan and rea-
sonable expectations), and 
‘‘(B) which, in combination, offer the actu-
ary’s best estimate of anticipated experience 
under the plan. 
‘‘(4) TREATMENT OF CERTAIN CHANGES AS EX-
PERIENCE GAIN OR LOSS.—For purposes of this sec-
tion, if— 
‘‘(A) a change in benefits under the Social 
Security Act or in other retirement benefits cre-
ated under Federal or State law, or
‘‘(B) a change in the definition of the term 
‘wages’ under section 3121 or a change in the 
amount of such wages taken into account under 
regulations prescribed for purposes of section 
401(a)(5), 
results in an increase or decrease in accrued liability 
under a plan, such increase or decrease shall be 
treated as an experience loss or gain. 
‘‘(5) FUNDING METHOD AND PLAN YEAR.— 
‘‘(A) FUNDING METHODS AVAILABLE.—All 
funding methods available to CSEC plans under 
section 412 (as in effect on the day before the 
enactment of the Pension Protection Act of 
2006) shall continue to be available under this 
section. 
‘‘(B) CHANGES.—If the funding method 
for a plan is changed, the new funding method 
shall become the funding method used to deter-
mine costs and liabilities under the plan only if 
the change is approved by the Secretary. If the 
plan year for a plan is changed, the new plan 
year shall become the plan year for the plan 
only if the change is approved by the Secretary. 
‘‘(C) APPROVAL REQUIRED FOR CERTAIN 
CHANGES
IN
ASSUMPTIONS
BY
CERTAIN
SIN-
GLE-EMPLOYER
PLANS
SUBJECT
TO
ADDI-
TIONAL FUNDING REQUIREMENT.— 
‘‘(i) IN GENERAL.—No actuarial as-
sumption (other than the assumptions de-
scribed in subsection (h)(3)) used to deter-
mine the current liability for a plan to 
which this subparagraph applies may be 
changed without the approval of the Sec-
retary. 
‘‘(ii) PLANS
TO
WHICH
SUBPARA-
GRAPH APPLIES.—This subparagraph shall 
apply to a plan only if— 
‘‘(I) the plan is a CSEC plan, 
‘‘(II) the aggregate unfunded 
vested benefits as of the close of the 
preceding plan year (as determined 
under section 4006(a)(3)(E)(iii) of the 
Employee Retirement Income Security 
Act of 1974) of such plan and all 
other plans maintained by the contrib-
uting sponsors (as defined in section 
4001(a)(13) of such Act) and mem-
bers of such sponsors’ controlled 
groups 
(as 
defined 
in 
section 
4001(a)(14) of such Act) which are
covered by title IV (disregarding plans 
with no unfunded vested benefits) ex-
ceed $50,000,000, and 
‘‘(III) the change in assumptions 
(determined after taking into account 
any changes in interest rate and mor-
tality table) results in a decrease in 
the funding shortfall of the plan for 
the current plan year that exceeds 
$50,000,000, 
or 
that 
exceeds 
$5,000,000 and that is 5 percent or 
more of the current liability of the 
plan before such change. 
‘‘(6) FULL FUNDING.—If, as of the close of a 
plan year, a plan would (without regard to this para-
graph) have an accumulated funding deficiency (de-
termined without regard to the alternative minimum 
funding standard account permitted under sub-
section (e)) in excess of the full funding limitation— 
‘‘(A) the funding standard account shall be 
credited with the amount of such excess, and 
‘‘(B) all amounts described in paragraphs 
(2)(B), (C), and (D) and (3)(B) of subsection 
(b) which are required to be amortized shall be
considered fully amortized for purposes of such 
paragraphs. 
‘‘(7) FULL-FUNDING
LIMITATION.—For pur-
poses of paragraph (6), the term ‘full-funding limita-
tion’ means the excess (if any) of— 
‘‘(A) the accrued liability (including nor-
mal cost) under the plan (determined under the 
entry age normal funding method if such ac-
crued liability cannot be directly calculated 
under the funding method used for the plan), 
over 
‘‘(B) the lesser of— 
‘‘(i) the fair market value of the 
plan’s assets, or 
‘‘(ii) the value of such assets deter-
mined under paragraph (2). 
‘‘(C) MINIMUM AMOUNT.— 
‘‘(i) IN GENERAL.—In no event shall 
the 
full-funding 
limitation 
determined 
under subparagraph (A) be less than the 
excess (if any) of— 
‘‘(I) 90 percent of the current li-
ability (determined without regard to 
paragraph (4) of subsection (h)) of 
the plan (including the expected in-
crease in such current liability due to 
benefits accruing during the plan 
year), over 
‘‘(II) the value of the plan’s as-
sets determined under paragraph (2). 
‘‘(ii) ASSETS.—For purposes of clause 
(i), assets shall not be reduced by any 
credit balance in the funding standard ac-
count. 
‘‘(8) 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 
in particular cases under regulations prescribed 
by the Secretary. 
‘‘(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. 
‘‘(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, 
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. 
‘‘(9) TIME
WHEN
CERTAIN
CONTRIBUTIONS 
DEEMED MADE.—For purposes of this section, any 
contributions for a plan year made by an employer 
during the period— 
‘‘(A) beginning on the day after the last 
day of such plan year, and
‘‘(B) ending on the day which is 81⁄2 
months after the close of the plan year, 
shall be deemed to have been made on such last day. 
‘‘(10) ANTICIPATION
OF
BENEFIT
INCREASES 
EFFECTIVE IN THE FUTURE.—In determining pro-
jected benefits, the funding method of a collectively 
bargained CSEC plan described in section 413(a) 
shall anticipate benefit increases scheduled to take 
effect during the term of the collective bargaining 
agreement applicable to the plan. 
‘‘(d) EXTENSION OF AMORTIZATION PERIODS.—The 
period of years required to amortize any unfunded liability 
(described in any clause of subsection (b)(2)(B)) of any 
plan may be extended by the Secretary for a period of 
time (not in excess of 10 years) if the Secretary deter-
mines that such extension would carry out the purposes 
of the Employee Retirement Income Security Act of 1974 
and provide adequate protection for participants under the 
plan and their beneficiaries, and if the Secretary deter-
mines that the failure to permit such extension would re-
sult in— 
‘‘(1) a substantial risk to the voluntary continu-
ation of the plan, or 
‘‘(2) a substantial curtailment of pension ben-
efit levels or employee compensation.
‘‘(e) ALTERNATIVE
MINIMUM
FUNDING
STAND-
ARD.— 
‘‘(1) IN GENERAL.—A CSEC plan which uses a 
funding method that requires contributions in all 
years not less than those required under the entry 
age normal funding method may maintain an alter-
native minimum funding standard account for any 
plan year. Such account shall be credited and 
charged solely as provided in this subsection. 
‘‘(2) CHARGES AND CREDITS TO ACCOUNT.— 
For a plan year the alternative minimum funding 
standard account shall be— 
‘‘(A) charged with the sum of— 
‘‘(i) the lesser of normal cost under 
the funding method used under the plan or 
normal cost determined under the unit 
credit method, 
‘‘(ii) the excess, if any, of the present 
value of accrued benefits under the plan 
over the fair market value of the assets, 
and 
‘‘(iii) an amount equal to the excess 
(if any) of credits to the alternative min-
imum standard account for all prior plan
years over charges to such account for all 
such years, and 
‘‘(B) credited with the amount considered 
contributed by the employer to or under the 
plan for the plan year. 
‘‘(3) INTEREST.—The alternative minimum 
funding standard account (and items therein) shall 
be charged or credited with interest in the manner 
provided under subsection (b)(5) with respect to the 
funding standard account. 
‘‘(f) QUARTERLY CONTRIBUTIONS REQUIRED.— 
‘‘(1) IN GENERAL.—If a CSEC plan which has 
a funded current liability percentage for the pre-
ceding plan year of less than 100 percent fails to 
pay the full amount of a required installment for the 
plan year, then the rate of interest charged to the 
funding standard account under subsection (b)(5) 
with respect to the amount of the underpayment for 
the period of the underpayment shall be equal to the 
greater of— 
‘‘(A) 175 percent of the Federal mid-term 
rate (as in effect under section 1274 for the 1st 
month of such plan year), or 
‘‘(B) the rate of interest used under the 
plan in determining costs.
‘‘(2) AMOUNT OF UNDERPAYMENT, PERIOD OF 
UNDERPAYMENT.—For purposes of paragraph (1)— 
‘‘(A) AMOUNT.—The amount of the under-
payment shall be the excess of— 
‘‘(i) the required installment, over 
‘‘(ii) the amount (if any) of the in-
stallment contributed to or under the plan 
on or before the due date for the install-
ment. 
‘‘(B) PERIOD
OF
UNDERPAYMENT.—The 
period for which interest is charged under this 
subsection with regard to any portion of the un-
derpayment shall run from the due date for the 
installment to the date on which such portion is 
contributed to or under the plan (determined 
without regard to subsection (c)(9)). 
‘‘(C) ORDER
OF
CREDITING
CONTRIBU-
TIONS.—For purposes of subparagraph (A)(ii), 
contributions shall be credited against unpaid 
required installments in the order in which such 
installments are required to be paid. 
‘‘(3) NUMBER
OF
REQUIRED
INSTALLMENTS; 
DUE DATES.—For purposes of this subsection—
‘‘(A) PAYABLE
IN
INSTALLMENTS.— 
There shall be 4 required installments for each 
plan year. 
‘‘(B) TIME
FOR
PAYMENT
OF
INSTALL-
MENTS.— 
‘‘In the case of the following 
required installments: 
The due date is: 
1st ........................................................
April 15
2nd .......................................................
July 15
3rd ........................................................
October 15
4th ........................................................
January 15 of the following year. 
‘‘(4) AMOUNT OF REQUIRED INSTALLMENT.— 
For purposes of this subsection— 
‘‘(A) IN GENERAL.—The amount of any 
required installment shall be 25 percent of the 
required annual payment. 
‘‘(B) REQUIRED ANNUAL PAYMENT.—For 
purposes of subparagraph (A), the term ‘re-
quired annual payment’ means the lesser of— 
‘‘(i) 90 percent of the amount re-
quired to be contributed to or under the 
plan by the employer for the plan year 
under section 412 (without regard to any 
waiver under subsection (c) thereof), or 
‘‘(ii) 100 percent of the amount so re-
quired for the preceding plan year.
Clause (ii) shall not apply if the preceding plan 
year was not a year of 12 months. 
‘‘(5) LIQUIDITY REQUIREMENT.— 
‘‘(A) IN GENERAL.—A plan to which this 
paragraph applies shall be treated as failing to 
pay the full amount of any required installment 
to the extent that the value of the liquid assets 
paid in such installment is less than the liquid-
ity shortfall (whether or not such liquidity 
shortfall exceeds the amount of such install-
ment required to be paid but for this para-
graph). 
‘‘(B) PLANS
TO
WHICH
PARAGRAPH
AP-
PLIES.—This paragraph shall apply to a CSEC 
plan other than a plan described in section 
412(l)(6)(A) (as in effect on the day before the 
enactment of the Pension Protection Act of 
2006) which— 
‘‘(i) is required to pay installments 
under this subsection for a plan year, and 
‘‘(ii) has a liquidity shortfall for any 
quarter during such plan year. 
‘‘(C) PERIOD
OF
UNDERPAYMENT.—For 
purposes of paragraph (1), any portion of an 
installment that is treated as not paid under
subparagraph (A) shall continue to be treated 
as unpaid until the close of the quarter in 
which the due date for such installment occurs. 
‘‘(D) LIMITATION
ON
INCREASE.—If the 
amount of any required installment is increased 
by reason of subparagraph (A), in no event 
shall such increase exceed the amount which, 
when added to prior installments for the plan 
year, is necessary to increase the funded cur-
rent liability percentage (taking into account 
the expected increase in current liability due to 
benefits accruing during the plan year) to 100 
percent. 
‘‘(E) DEFINITIONS.—For purposes of this 
paragraph— 
‘‘(i) 
LIQUIDITY
SHORTFALL.—The 
term ‘liquidity shortfall’ means, with re-
spect to any required installment, an 
amount equal to the excess (as of the last 
day of the quarter for which such install-
ment is made) of the base amount with re-
spect to such quarter over the value (as of 
such last day) of the plan’s liquid assets. 
‘‘(ii) BASE AMOUNT.—
‘‘(I) IN
GENERAL.—The term 
‘base amount’ means, with respect to 
any quarter, an amount equal to 3 
times the sum of the adjusted dis-
bursements from the plan for the 12 
months ending on the last day of such 
quarter. 
‘‘(II) SPECIAL
RULE.—If the 
amount determined under subclause 
(I) exceeds an amount equal to 2 
times the sum of the adjusted dis-
bursements from the plan for the 36 
months ending on the last day of the 
quarter and an enrolled actuary cer-
tifies to the satisfaction of the Sec-
retary that such excess is the result of 
nonrecurring circumstances, the base 
amount with respect to such quarter 
shall be determined without regard to 
amounts related to those nonrecurring 
circumstances. 
‘‘(iii) DISBURSEMENTS
FROM
THE 
PLAN.—The term ‘disbursements from the 
plan’ means all disbursements from the 
trust, including purchases of annuities,
payments of single sums and other bene-
fits, and administrative expenses. 
‘‘(iv) ADJUSTED
DISBURSEMENTS.— 
The term ‘adjusted disbursements’ means 
disbursements from the plan reduced by 
the product of— 
‘‘(I) the plan’s funded current li-
ability percentage for the plan year, 
and 
‘‘(II) the sum of the purchases of 
annuities, payments of single sums, 
and such other disbursements as the 
Secretary shall provide in regulations. 
‘‘(v) LIQUID ASSETS.—The term ‘liq-
uid assets’ means cash, marketable securi-
ties and such other assets as specified by 
the Secretary in regulations. 
‘‘(vi) QUARTER.—The term ‘quarter’ 
means, with respect to any required install-
ment, the 3-month period preceding the 
month in which the due date for such in-
stallment occurs. 
‘‘(F) REGULATIONS.—The Secretary may 
prescribe such regulations as are necessary to 
carry out this paragraph.
‘‘(6) FISCAL YEARS AND SHORT YEARS.— 
‘‘(A) FISCAL
YEARS.—In applying this 
subsection to a plan year beginning on any date 
other than January 1, there shall be substituted 
for the months specified in this subsection, the 
months which correspond thereto. 
‘‘(B) SHORT PLAN YEAR.—This subsection 
shall be applied to plan years of less than 12 
months in accordance with regulations pre-
scribed by the Secretary. 
‘‘(g) IMPOSITION
OF LIEN WHERE FAILURE TO 
MAKE REQUIRED CONTRIBUTIONS.— 
‘‘(1) IN GENERAL.—In the case of a plan to 
which this section applies, if— 
‘‘(A) any person fails to make a required 
installment under subsection (f) or any other 
payment required under this section before the 
due date for such installment or other payment, 
and 
‘‘(B) the unpaid balance of such install-
ment or other payment (including interest), 
when added to the aggregate unpaid balance of 
all preceding such installments or other pay-
ments for which payment was not made before
the due date (including interest), exceeds 
$1,000,000, 
then there shall be a lien in favor of the plan in the 
amount determined under paragraph (3) upon all 
property and rights to property, whether real or per-
sonal, belonging to such person and any other per-
son who is a member of the same controlled group 
of which such person is a member. 
‘‘(2) PLANS TO WHICH SUBSECTION APPLIES.— 
This subsection shall apply to a CSEC plan for any 
plan year for which the funded current liability per-
centage of such plan is less than 100 percent. This 
subsection shall not apply to any plan to which sec-
tion 4021 of the Employee Retirement Income Secu-
rity Act of 1974 does not apply (as such section is 
in effect on the date of the enactment of the Retire-
ment Protection Act of 1994). 
‘‘(3) AMOUNT OF LIEN.—For purposes of para-
graph (1), the amount of the lien shall be equal to 
the aggregate unpaid balance of required install-
ments and other payments required under this sec-
tion (including interest)— 
‘‘(A) for plan years beginning after 1987, 
and
‘‘(B) for which payment has not been 
made before the due date. 
‘‘(4) NOTICE OF FAILURE; LIEN.— 
‘‘(A) NOTICE
OF
FAILURE.—A person 
committing a failure described in paragraph (1) 
shall notify the Pension Benefit Guaranty Cor-
poration of such failure within 10 days of the 
due date for the required installment or other 
payment. 
‘‘(B) PERIOD OF LIEN.—The lien imposed 
by paragraph (1) shall arise on the due date for 
the required installment or other payment and 
shall continue until the last day of the first plan 
year in which the plan ceases to be described in 
paragraph (1)(B). Such lien shall continue to 
run without regard to whether such plan con-
tinues to be described in paragraph (2) during 
the period referred to in the preceding sentence. 
‘‘(C) CERTAIN
RULES
TO
APPLY.—Any 
amount with respect to which a lien is imposed 
under paragraph (1) shall be treated as taxes 
due and owing the United States and rules 
similar to the rules of subsections (c), (d), and 
(e) of section 4068 of the Employee Retirement 
Income Security Act of 1974 shall apply with
respect to a lien imposed by subsection (a) and 
the amount with respect to such lien. 
‘‘(5) ENFORCEMENT.—Any lien created under 
paragraph (1) may be perfected and enforced only 
by the Pension Benefit Guaranty Corporation, or at 
the direction of the Pension Benefit Guaranty Cor-
poration, by any contributing employer (or any 
member of the controlled group of the contributing 
employer). 
‘‘(6) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) DUE
DATE; 
REQUIRED
INSTALL-
MENT.—The terms ‘due date’ and ‘required in-
stallment’ have the meanings given such terms 
by subsection (f), except that in the case of a 
payment other than a required installment, the 
due date shall be the date such payment is re-
quired to be made under this section. 
‘‘(B) CONTROLLED
GROUP.—The term 
‘controlled group’ means any group treated as 
a single employer under subsections (b), (c), 
(m), and (o) of section 414. 
‘‘(h) CURRENT LIABILITY.—For purposes of this sec-
tion—
‘‘(1) IN GENERAL.—The term ‘current liability’ 
means all liabilities to employees and their bene-
ficiaries under the plan. 
‘‘(2) TREATMENT OF UNPREDICTABLE CONTIN-
GENT EVENT BENEFITS.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), any unpredictable contingent event 
benefit shall not be taken into account until the 
event on which the benefit is contingent occurs. 
‘‘(B) 
UNPREDICTABLE
CONTINGENT 
EVENT
BENEFIT.—The term ‘unpredictable 
contingent event benefit’ means any benefit 
contingent on an event other than— 
‘‘(i) age, service, compensation, death, 
or disability, or 
‘‘(ii) an event which is reasonably and 
reliably predictable (as determined by the 
Secretary). 
‘‘(3) INTEREST RATE AND MORTALITY ASSUMP-
TIONS USED.— 
‘‘(A) INTEREST RATE.—The rate of inter-
est used to determine current liability under 
this section shall be the third segment rate de-
termined under section 430(h)(2)(C). 
‘‘(B) MORTALITY TABLES.—
‘‘(i) SECRETARIAL AUTHORITY.—The 
Secretary may by regulation prescribe mor-
tality tables to be used in determining cur-
rent liability under this subsection. Such 
tables shall be based upon the actual expe-
rience of pension plans and projected 
trends in such experience. In prescribing 
such tables, the Secretary shall take into 
account results of available independent 
studies of mortality of individuals covered 
by pension plans. 
‘‘(ii) PERIODIC
REVIEW.—The Sec-
retary shall periodically (at least every 5 
years) review any tables in effect under 
this subsection and shall, to the extent the 
Secretary determines necessary, by regula-
tion update the tables to reflect the actual 
experience of pension plans and projected 
trends in such experience. 
‘‘(C) SEPARATE MORTALITY TABLES FOR 
THE
DISABLED.—Notwithstanding 
subpara-
graph (B)— 
‘‘(i) IN
GENERAL.—In the case of 
plan years beginning after December 31, 
1995, the Secretary shall establish mor-
tality tables which may be used (in lieu of 
the tables under subparagraph (B)) to de-
termine current liability under this sub-
section for individuals who are entitled to 
benefits under the plan on account of dis-
ability. The Secretary shall establish sepa-
rate tables for individuals whose disabil-
ities occur in plan years beginning before 
January 1, 1995, and for individuals 
whose disabilities occur in plan years be-
ginning on or after such date. 
‘‘(ii) SPECIAL RULE FOR DISABILITIES 
OCCURRING AFTER 1994.—In the case of 
disabilities occurring in plan years begin-
ning after December 31, 1994, the tables 
under clause (i) shall apply only with re-
spect to individuals described in such sub-
clause who are disabled within the meaning 
of title II of the Social Security Act and 
the regulations thereunder. 
‘‘(4) CERTAIN SERVICE DISREGARDED.— 
‘‘(A) IN GENERAL.—In the case of a par-
ticipant to whom this paragraph applies, only 
the applicable percentage of the years of service 
before such individual became a participant
shall be taken into account in computing the 
current liability of the plan. 
‘‘(B) 
APPLICABLE
PERCENTAGE.—For 
purposes of this subparagraph, the applicable 
percentage shall be determined as follows: 
‘‘If the years of participation 
are: 
The applicable percentage 
is: 
1 ....................................................................
2 ....................................................................
3 ....................................................................
4 ....................................................................
5 or more ......................................................
100. 
‘‘(C) PARTICIPANTS TO WHOM PARAGRAPH 
APPLIES.—This subparagraph shall apply to 
any participant who, at the time of becoming a 
participant— 
‘‘(i) has not accrued any other benefit 
under any defined benefit plan (whether or 
not terminated) maintained by the em-
ployer or a member of the same controlled 
group of which the employer is a member, 
‘‘(ii) who first becomes a participant 
under the plan in a plan year beginning 
after December 31, 1987, and 
‘‘(iii) has years of service greater than 
the minimum years of service necessary for 
eligibility to participate in the plan.
‘‘(D) ELECTION.—An employer may elect 
not to have this subparagraph apply. Such an 
election, once made, may be revoked only with 
the consent of the Secretary. 
‘‘(i) FUNDED CURRENT LIABILITY PERCENTAGE.— 
For purposes of this section, the term ‘funded current li-
ability percentage’ means, with respect to any plan year, 
the percentage which— 
‘‘(1) the value of the plan’s assets determined 
under subsection (c)(2), is of 
‘‘(2) the current liability under the plan. 
‘‘(j) FUNDING
RESTORATION
STATUS.—Notwith-
standing any other provisions of this section— 
‘‘(1) NORMAL COST PAYMENT.— 
‘‘(A) IN
GENERAL.—In the case of a 
CSEC plan that is in funding restoration status 
for a plan year, for purposes of section 412, the 
term ‘accumulated funding deficiency’ means, 
for such plan year, the greater of— 
‘‘(i) the amount described in sub-
section (a), or 
‘‘(ii) the excess of the normal cost of 
the plan for the plan year over the amount 
actually contributed to or under the plan 
for the plan year.
‘‘(B) NORMAL
COST.—In the case of a 
CSEC plan that uses a spread gain funding 
method, for purposes of this subsection, the 
term ‘normal cost’ means normal cost as deter-
mined under the entry age normal funding 
method. 
‘‘(2) PLAN
AMENDMENTS.—In the case of a 
CSEC plan that is in funding restoration status for 
a plan year, no amendment to such plan may take 
effect during such plan year if such amendment has 
the effect of increasing liabilities of the plan by 
means of increases in benefits, establishment of new 
benefits, changing the rate of benefit accrual, or 
changing the rate at which benefits become non-
forfeitable. This paragraph shall not apply to any 
plan amendment that is required to comply with any 
applicable law. This paragraph shall cease to apply 
with respect to any plan year, effective as of the 
first day of the plan year (or if later, the effective 
date of the amendment) upon payment by the plan 
sponsor of a contribution to the plan (in addition to 
any contribution required under this section without 
regard to this paragraph) in an amount equal to the 
increase in the funding liability of the plan attrib-
utable to the plan amendment.
‘‘(3) FUNDING RESTORATION PLAN.—The spon-
sor of a CSEC plan shall establish a written funding 
restoration plan within 180 days of the receipt by 
the plan sponsor of a certification from the plan ac-
tuary that the plan is in funding restoration status 
for a plan year. Such funding restoration plan shall 
consist of actions that are calculated, based on rea-
sonably anticipated experience and reasonable actu-
arial assumptions, to increase the plan’s funded per-
centage to 100 percent over a period that is not 
longer than the greater of 7 years or the shortest 
amount of time practicable. Such funding restora-
tion plan shall take into account contributions re-
quired under this section (without regard to this 
paragraph). If a plan remains in funding restoration 
status for 2 or more years, such funding restoration 
plan shall be updated each year after the 1st such 
year within 180 days of receipt by the plan sponsor 
of a certification from the plan actuary that the plan 
remains in funding restoration status for the plan 
year. 
‘‘(4) ANNUAL CERTIFICATION BY PLAN ACTU-
ARY.—Not later than the 90th day of each plan year 
of a CSEC plan, the plan actuary shall certify to the 
plan sponsor whether or not the plan is in funding
restoration status for the plan year, based on the 
plan’s funded percentage as of the beginning of the 
plan year. For this purpose, the actuary may conclu-
sively rely on an estimate of— 
‘‘(A) the plan’s funding liability, based on 
the funding liability of the plan for the pre-
ceding plan year and on reasonable actuarial es-
timates, assumptions, and methods, and 
‘‘(B) the amount of any contributions rea-
sonably anticipated to be made for the pre-
ceding plan year. 
Contributions described in subparagraph (B) shall 
be taken into account in determining the plan’s 
funded percentage as of the beginning of the plan 
year. 
‘‘(5) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) FUNDING RESTORATION STATUS.—A 
CSEC plan shall be treated as in funding res-
toration status for a plan year if the plan’s 
funded percentage as of the beginning of such 
plan year is less than 80 percent. 
‘‘(B) FUNDED
PERCENTAGE.—The term 
‘funded percentage’ means the ratio (expressed 
as a percentage) which—
‘‘(i) the value of plan assets (as deter-
mined under subsection (c)(2)), bears to 
‘‘(ii) the plan’s funding liability. 
‘‘(C) 
FUNDING
LIABILITY.—The 
term 
‘funding liability’ for a plan year means the 
present value of all benefits accrued or earned 
under the plan as of the beginning of the plan 
year, based on the assumptions used by the 
plan pursuant to this section, including the in-
terest rate described in subsection (b)(5)(A) 
(without regard to subsection (b)(5)(B)). 
‘‘(D) SPREAD GAIN FUNDING METHOD.— 
The term ‘spread gain funding method’ has the 
meaning given such term under rules and forms 
issued by the Secretary. 
‘‘(E) PLAN
SPONSOR.—The term ‘plan 
sponsor’ means, with respect to a CSEC plan, 
the association, committee, joint board of trust-
ees, or other similar group of representatives of 
the parties who establish or maintain the 
plan.’’. 
(b) CSEC PLANS.—Section 413 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection:
‘‘(d) CSEC PLANS.—Notwithstanding any other pro-
vision of this section, in the case of a CSEC plan— 
‘‘(1) FUNDING.—The requirements of section 
412 shall be determined as if all participants in the 
plan were employed by a single employer. 
‘‘(2) 
APPLICATION
OF
PROVISIONS.—Para-
graphs (1), (2), (3), and (5) of subsection (c) shall 
apply. 
‘‘(3) DEDUCTION LIMITATIONS.—Each applica-
ble limitation provided by section 404(a) shall be de-
termined as if all participants in the plan were em-
ployed by a single employer. The amounts contrib-
uted to or under the plan by each employer who 
maintains the plan (for the portion of the taxable 
year included within a plan year) shall be considered 
not to exceed such applicable limitation if the antici-
pated employer contributions for such plan year of 
all employers (determined in a reasonable manner 
not inconsistent with regulations prescribed by the 
Secretary) do not exceed such limitation. If such an-
ticipated contributions exceed such limitation, the 
portion of each such employer’s contributions which 
is not deductible under section 404 shall be deter-
mined in accordance with regulations prescribed by 
the Secretary.
‘‘(4) ALLOCATIONS.—Allocations of amounts 
under paragraph (3) and subsection (c)(5) among 
the employers maintaining the plan shall not be in-
consistent with the regulations prescribed for this 
purpose by the Secretary.’’. 
(c) SEPARATE RULES FOR CSEC PLANS.— 
(1) IN
GENERAL.—Paragraph (2) of section 
412(a) of the Internal Revenue Code of 1986 is 
amended by striking ‘‘and’’ at the end of subpara-
graph (B), by striking the period at the end of sub-
paragraph (C) and inserting ‘‘, and’’, and by insert-
ing at the end thereof the following new subpara-
graph: 
‘‘(D) in the case of a CSEC plan, the em-
ployers make contributions to or under the plan 
for any plan year which, in the aggregate, are 
sufficient to ensure that the plan does not have 
an accumulated funding deficiency under sec-
tion 433 as of the end of the plan year.’’. 
(2) CONFORMING AMENDMENTS.—Section 412 
of such Code is amended— 
(A) by striking ‘‘multiemployer plan’’ in 
paragraph (A) of subsection (a)(2), in clause (i) 
of subsection (c)(1)(B), the first place it ap-
pears in clause (i) of subsection (c)(1)(A), and
the last place it appears in paragraph (2) of 
subsection (d), and inserting ‘‘multiemployer 
plan or a CSEC plan’’, 
(B) by striking ‘‘430(j)’’ in paragraph (1) 
of subsection (b) and inserting ‘‘430(j) or under 
section 433(f)’’, 
(C)(i) by striking ‘‘and’’ at the end of 
clause (i) of subsection (c)(1)(B), 
(ii) by striking the period at the end of 
clause (ii) of subsection (c)(1)(B) and inserting 
‘‘, and’’, and 
(iii) by inserting the following new clause 
after clause (ii) of subsection (c)(1)(B): 
‘‘(iii) in the case of a CSEC plan, the 
funding standard account shall be credited 
under 
section 
433(b)(3)(C) 
with 
the 
amount of the waived funding deficiency 
and such amount shall be amortized as re-
quired under section 433(b)(2)(C).’’, 
(D) by striking ‘‘under paragraph (1)’’ in 
clause (i) of subsection (c)(4)(A) and inserting 
‘‘under paragraph (1) or for granting an exten-
sion under section 433(d)’’, 
(E) by striking ‘‘waiver under this sub-
section’’ in subparagraph (B) of subsection
(c)(4) and inserting ‘‘waiver under this sub-
section or an extension under 433(d)’’, 
(F) by striking ‘‘waiver or modification’’ in 
subclause (I) of subsection (c)(4)(B)(i) and in-
serting ‘‘waiver, modification, or extension’’, 
(G) by striking ‘‘waivers’’ in the heading of 
subsection (c)(4)(C) and of clause (ii) of sub-
section (c)(4)(C) and inserting ‘‘waivers or ex-
tensions’’, 
(H) by striking ‘‘section 431(d)’’ in sub-
paragraph (A) of subsection (c)(7) and in para-
graph (2) of subsection (d) and inserting ‘‘sec-
tion 431(d) or section 433(d)’’, 
(I) by striking ‘‘and’’ at the end of sub-
clause (I) of subsection (c)(4)(C)(i) and insert-
ing ‘‘or the accumulated funding deficiency 
under section 433, whichever is applicable,’’, 
(J) by striking ‘‘430(e)(2),’’ in subclause 
(II) of subsection (c)(4)(C)(i) and inserting 
‘‘430(e)(2) or 433(b)(2)(C), whichever is appli-
cable, and’’, 
(K) by adding immediately after subclause 
(II) of subsection (c)(4)(C)(i) the following new 
subclause:
‘‘(III) the total amounts not paid 
by reason of an extension in effect 
under section 433(d),’’, and 
(L) by striking ‘‘for waivers of’’ in clause 
(ii) of subsection (c)(4)(C) and inserting ‘‘for 
waivers or extensions with respect to’’. 
(3) BENEFIT RESTRICTIONS.— 
(A) IN GENERAL.—Paragraph (29) of sec-
tion 401(a) of such Code is amended by strik-
ing ‘‘multiemployer plan’’ and inserting ‘‘multi-
employer plan or a CSEC plan’’. 
(B) CONFORMING
CHANGE.—Subsection 
(a) of section 436 of such Code is amended by 
striking ‘‘single-employer plan’’ and inserting 
‘‘single-employer plan (other than a CSEC 
plan)’’. 
(4) BENEFIT
INCREASES.—Subparagraph (C) 
of section 401(a)(33) of such Code is amended by 
striking ‘‘multiemployer plans’’ and inserting ‘‘multi-
employer plans or CSEC plans’’. 
(5) LIQUIDITY SHORTFALLS.— 
(A) IN
GENERAL.—Subparagraph (A) of 
section 401(a)(32) of such Code is amended by 
striking ‘‘430(j)(4)’’ each place it appears and 
inserting ‘‘430(j)(4) or 433(f)(5)’’.
100 
(B) PERIOD
OF
SHORTFALL.—Subpara-
graph (C) of section 401(a)(32) of such Code is 
amended by striking ‘‘430(j)(3) by reason of 
section 430(j)(4)(A) thereof’’ and inserting 
‘‘430(j)(3) or 433(f) by reason of section 
430(j)(4)(A) or 433(f)(5), respectively’’. 
(6) DEDUCTION LIMITS.—Subsection (o) of sec-
tion 404 of such Code is amended by adding at the 
end the following new paragraph: 
‘‘(8) CSEC PLANS.—Solely for purposes of this 
subsection, a CSEC plan shall be treated as though 
section 430 applied to such plan and the minimum 
required contribution for any plan year shall be the 
amount described in section 412(a)(2)(D).’’. 
(7) SECTION
420.—Paragraph (5) of section 
420(e) of such Code is amended by striking ‘‘section 
430’’ each place it appears and inserting ‘‘sections 
430 and 433’’. 
(8) COORDINATION WITH SECTION 4971.— 
(A) Subsection (a) of section 4971 of such 
Code is amended by striking ‘‘and’’ at the end 
of paragraph (1), by striking the period at the 
end of paragraph (2) and inserting ‘‘, and’’, 
and by adding at the end thereof the following 
new paragraph:
101 
‘‘(3) in the case of a CSEC plan, 10 percent of 
the CSEC accumulated funding deficiency as of the 
end of the plan year ending with or within the tax-
able year.’’. 
(B) Subsection (b) of section 4971 of such 
Code is amended— 
(i) by striking ‘‘or’’ at the end of 
paragraph (1), by adding ‘‘or’’ at the end 
of paragraph (2), and by inserting imme-
diately after paragraph (2) the following 
new paragraph: 
‘‘(3) a tax is imposed under subsection (a)(3) 
on any CSEC accumulated funding deficiency and 
the CSEC accumulated funding deficiency is not cor-
rected within the taxable period,’’, and 
(ii) by striking ‘‘minimum required 
contributions or accumulated funding defi-
ciency’’ and inserting ‘‘minimum required 
contribution, accumulated funding defi-
ciency, or CSEC accumulated funding defi-
ciency’’. 
(C) Subsection (c) of section 4971 of such 
Code is amended— 
(i) by striking ‘‘accumulated funding 
deficiency’’ each place it appears in para-