amortization base of the plan for 
the applicable plan year in level 
annual installments over such 
last 7 plan years, and 
‘‘(bb) in the case of the first 
2 plan years in such 9-plan-year 
period, interest on such shortfall 
amortization base (determined 
using the effective rate of inter-
est for the plan for the plan 
year). 
‘‘(II) SHORTFALL AMORTIZATION 
INSTALLMENT.—The shortfall amorti-
zation installment for any plan year in 
the 9-plan-year period under this 
clause with respect to such shortfall 
amortization base is the annual in-
stallment 
determined 
under 
this 
clause for that year for that base. 
‘‘(III) MINIMUM REQUIRED CON-
TRIBUTION
FOR
FIRST
YEARS.— 
Notwithstanding the preceding provi-
sions of this clause, the minimum re-
quired contribution for the two plan 
years described in subclause (I)(bb) 
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shall be increased to the extent nec-
essary so that the minimum required 
contribution for such plan year is at 
least equal to the applicable percent-
age of the minimum required con-
tribution for the plan year preceding 
the first applicable plan year. If the 
minimum required contribution is in-
creased by reason of the preceding 
sentence, the shortfall amortization 
installments with respect to the short-
fall amortization base for any applica-
ble plan year shall be reduced to take 
such increase into account, pursuant 
to rules issued by the Secretary, but 
only if the shortfall amortization in-
stallments with respect to the shortfall 
amortization base for such applicable 
plan year are determined under this 
clause. For purposes of this subclause, 
any reference to the minimum re-
quired contribution for any plan year 
shall be a reference to the minimum 
required contribution for such plan 
year prior to any reduction under sub-
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section (f) and without taking into ac-
count 
any 
waiver 
under 
section 
412(c). For purposes of this clause, 
the applicable percentage shall be de-
termined as follows: 
The applicable 
‘‘For the: 
percentage is: 
First applicable plan year .................................................
105 
Second applicable plan year ..............................................
110 
Plan year following the second applicable plan year ........
115 
‘‘(iii) 15-YEAR
AMORTIZATION.—The 
shortfall 
amortization 
installments 
de-
scribed in this clause are the amounts nec-
essary to amortize the shortfall amortiza-
tion base of the plan for the applicable 
plan year in level annual installments over 
15 years. The shortfall amortization in-
stallments for any plan year in the 15- 
plan-year period under this clause is the 
annual installment determined under this 
clause for that year for that base. 
‘‘(iv) ELECTION.—The plan sponsor 
may, with respect to a plan, elect whether 
to determine shortfall amortization install-
ments under clause (ii), clause (iii), or 
without regard to this subparagraph. Such 
election shall be made at such times, and 
in such form and manner, as shall be pre-
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scribed by the Secretary, and may be re-
voked only with the consent of the Sec-
retary. In the absence of a timely election 
to determine shortfall amortization install-
ments under such clause (ii) or clause (iii), 
such installments shall be determined with-
out regard to this subparagraph. 
‘‘(E) 
FAILURE
TO
MAINTAIN
ACTIVE 
PLAN.— 
‘‘(i) 2 AND 7 RULE.—If the shortfall 
amortization installments with respect to a 
shortfall amortization base for an applica-
ble plan year are determined under sub-
paragraph (D)(ii), the plan must remain 
an active plan for the subsequent plan 
year. If such plan fails to be an active plan 
in such plan year, the minimum required 
contribution for the plan year with respect 
to which a failure occurs shall be increased 
by all amounts by which the minimum re-
quired contribution for the current plan 
year or any prior plan year has been re-
duced by the application of subparagraph 
(D), plus interest on such amounts at the 
effective rate of interest for the plan for 
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the plan year for which the increase ap-
plies. However, any such increase in the 
minimum required contribution shall not 
require a contribution to the extent that 
the contribution would cause the value of 
plan assets for the plan year to exceed the 
funding target of the plan for the plan 
year (determined without regard to sub-
section (i)(1)). If the minimum required 
contribution is increased by reason of this 
clause, the shortfall amortization install-
ments with respect to the shortfall amorti-
zation base for any applicable plan year 
shall be reduced to take such increase into 
account, pursuant to rules issued by the 
Secretary, but only if the shortfall amorti-
zation installments with respect to the 
shortfall amortization base for such appli-
cable plan year are determined under sub-
paragraph (D)(ii). For purposes of this 
clause, any reference to the minimum re-
quired contribution for any plan year shall 
be a reference to the minimum required 
contribution for such plan year prior to 
any reduction under subsection (f) and 
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without taking into account any waiver 
under section 412(c). 
‘‘(ii) 15-YEAR RULE.—If the shortfall 
amortization installments with respect to a 
shortfall amortization base for an applica-
ble plan year are determined under sub-
paragraph (D)(iii), the plan must remain 
an active plan for the 7 subsequent plan 
years. If such plan fails to be an active 
plan in any such plan year, the shortfall 
amortization base, reduced by the principal 
portion of prior shortfall amortization in-
stallments relating to that base, shall be 
amortized over 7 years. 
‘‘(iii) SPECIAL RULE.—In the case of 
an applicable plan year that ends before 
July 1, 2009, the plan sponsor may elect 
not to have the active plan requirement 
apply for such plan year. If such election 
is made— 
‘‘(I) clause (i) shall be applied so 
as to require the plan to remain an 
active plan for the 2 subsequent plan 
years (instead of 1 subsequent plan 
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year) under rules prescribed by the 
Secretary, and 
‘‘(II) clause (ii) shall be applied 
by substituting ‘8’ for ‘7’ the first 
place it appears and by substituting 
‘6’ for ‘7’ the second place it appears. 
Such election shall be made at such times, 
and in such form and manner, as shall be 
prescribed by the Secretary, and may be 
revoked only with consent of the Secretary. 
‘‘(F) APPLICABLE PLAN YEAR.—For pur-
poses of this paragraph, the term ‘applicable 
plan year’ shall mean— 
‘‘(i) except as provided in clauses (ii) 
and (iii), any plan year beginning in 2009 
or 2010, 
‘‘(ii) in the case of a plan with a plan 
year beginning after October 31 and before 
January 1, any plan year beginning in 
2008 or 2009, and 
‘‘(iii) in the case of a plan for which 
the valuation date is not the first day of 
the plan year, any plan year beginning in 
2008 or 2009. 
‘‘(G) ACTIVE PLAN.— 
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‘‘(i) IN
GENERAL.—For purposes of 
this paragraph, the term ‘active plan’ 
means a defined benefit plan that is de-
scribed in clause (ii), (iii), or (iv). A de-
fined benefit plan may satisfy different 
clauses in different years. Notwithstanding 
clause (ii), (iii), or (iv), a defined benefit 
plan is not an active plan if an election 
under section 402(a)(1) of the Pension 
Protection Act of 2006 is in effect with re-
spect to such plan, or if the plan is de-
scribed under rules prescribed by the Sec-
retary designed to prevent evasion of the 
purposes of this subparagraph. 
‘‘(ii) DEFINED BENEFIT PLAN.— 
‘‘(I) IN
GENERAL.—A defined 
benefit plan is described in this clause 
if minimum benefit accruals are pro-
vided on behalf of all employees who 
have satisfied the plan’s age and serv-
ice requirements and who would, but 
for any prior amendment ceasing ac-
cruals, be eligible for an accrual under 
the plan. 
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‘‘(II) SPECIAL RULE REGARDING 
MINIMUM
BENEFIT
ACCRUALS.—For 
purposes of this clause, the employees 
described in this clause shall be treat-
ed as receiving minimum benefit ac-
cruals for a plan year if all such em-
ployees are accruing a benefit and— 
‘‘(aa) the rate of benefit ac-
crual for any such employee is 
not less than the greater of— 
‘‘(AA) the rate of ben-
efit accrual that would have 
been applied to the employee 
under the benefit formula in 
effect on July 1, 2009, dis-
regarding any amendments 
to the plan adopted after 
June 30, 2009, or 
‘‘(BB) the rate of ben-
efit accrual that would have 
applied 
to 
the 
employee 
under the benefit formula in 
effect as of the last date 
prior to the effective date of 
any plan amendment adopt-
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ed prior to July 1, 2009, 
that ceased providing benefit 
accruals based on additional 
service credit with respect to 
such employee, or 
‘‘(bb) the target normal cost 
(without regard to plan adminis-
trative expenses) for such plan 
year with respect to such employ-
ees is at least 3 percent of the 
aggregate compensation (as de-
fined in section 415(c)(3)) of 
such employees for such plan 
year. 
Solely for purposes of this paragraph, 
target normal cost shall be determined 
by using 5 percent in lieu of the inter-
est rate applicable under subsection 
(h) and by using the mortality tables 
described in subsection (h)(3)(A). 
‘‘(iii) 
DEFINED
CONTRIBUTION 
PLAN.— 
‘‘(I) IN
GENERAL.—A defined 
benefit plan is described in this clause 
if— 
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‘‘(aa) the defined benefit 
plan satisfies clause (ii) except 
with respect to employees whose 
failure to accrue a minimum ben-
efit is attributable to a plan 
amendment adopted prior to July 
1, 2009, and 
‘‘(bb) the plan sponsor (or 
any member of such sponsor’s 
controlled group) maintains a de-
fined contribution plan under 
which allocations are made on be-
half of each employee whose fail-
ure to accrue a benefit under the 
defined benefit plan causes the 
defined benefit plan not to be de-
scribed in clause (ii). 
‘‘(II) MINIMUM ALLOCATIONS.— 
Such allocations shall not be less than 
3 percent of an employee’s compensa-
tion (as determined in accordance 
with section 414(s)). A defined con-
tribution plan shall not fail to satisfy 
the requirements of this clause solely 
by reason of the failure to make allo-
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cations on behalf of one or more high-
ly compensated employees (as defined 
in section 414(q)). 
‘‘(III) ALLOCATIONS TAKEN INTO 
ACCOUNT.—For 
purposes 
of 
this 
clause, only the following types of al-
locations may be taken into account: 
‘‘(aa) 
Employer 
contribu-
tions 
or 
forfeitures 
allocated 
without regard to whether an em-
ployee makes an elective con-
tribution or an employee con-
tribution. 
‘‘(bb) In the case of the first 
plan year ending after June 30, 
2009, matching contributions (as 
defined in section 401(m)(4)(A)). 
‘‘(iv) NONQUALIFIED PLAN.— 
‘‘(I) IN
GENERAL.—A defined 
benefit plan is described in this clause 
if no key employee (as defined in sec-
tion 416(i) without regard to para-
graph (5) thereof) accrues any new 
benefits for the plan year under any 
nonqualified deferred compensation 
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plan (as defined in section 409A(d)) 
maintained by the sponsor of the de-
fined benefit plan or by any member 
of such sponsor’s controlled group. 
‘‘(II) REVOCATION
OF
CERTAIN 
ELECTIONS.—The Secretary shall pro-
vide rules under section 409A under 
which elections to defer compensation 
made prior to the date of enactment 
of this clause may be revoked by an 
employee within 180 days after the 
date of enactment of this clause, but 
only to the extent that, pursuant to 
this clause, such elections could other-
wise cause a failure of the employee 
to— 
‘‘(aa) 
earn 
compensation 
under an arrangement that, but 
for the election, is not a non-
qualified deferred compensation 
plan 
(as 
defined 
in 
section 
409A(d)), and 
‘‘(bb) 
earn 
compensation 
that is not payable to the em-
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ployee in another form or under 
a different arrangement. 
‘‘(v) MULTIPLE EMPLOYER PLANS.— 
In the case of a defined benefit plan de-
scribed in section 413(c)(4)(B), such plan 
shall be treated as an active plan if such 
plan satisfies clause (ii), (iii), or (iv) with 
respect to at least 85 percent of the em-
ployers participating in such plan. In ap-
plying the 85 percent requirement, dif-
ferent employers may satisfy different 
clauses. 
‘‘(vi) CONTROLLED GROUP.—For pur-
poses of this paragraph, the term ‘con-
trolled group’ means all employers treated 
as a single employer pursuant to sub-
sections (b) and (c) of section 414.’’. 
(2) CONFORMING AMENDMENT.—Paragraph (1) 
of section 430(c) of such Code is amended by strik-
ing ‘‘the shortfall amortization bases for such plan 
year and each of the 6 preceding plan years’’ and in-
serting ‘‘any shortfall amortization base which has 
not been fully amortized under this subsection’’. 
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(3) AMENDMENT TO SECTION 409A.—Paragraph 
(3) of section 409A(a) of the Internal Revenue Code 
of 1986 is amended to read as follows: 
‘‘(3) ACCELERATION OF BENEFITS.— 
‘‘(A) IN GENERAL.—The requirements of 
this paragraph are met if the plan does not per-
mit the acceleration of the time or schedule of 
any payment under the plan, except as provided 
in regulations by the Secretary. The require-
ments of this paragraph shall not be treated as 
satisfied if the plan makes any payment de-
scribed in subparagraph (B) or (C). 
‘‘(B) EXCESS PAYMENTS FOR CERTAIN AD-
JUSTED FUNDING TARGET ATTAINMENT PER-
CENTAGES BY ACTIVE PLAN.—A payment is de-
scribed in this subparagraph if— 
‘‘(i) such payment is made during a 
year in which a defined benefit plan main-
tained by the employer sponsoring a non-
qualified deferred compensation plan is re-
quired to be an active plan under section 
430(c)(2)(E) or section 107(e) of the Pen-
sion Protection Act of 2006, and such de-
fined benefit plan has not otherwise failed 
VerDate Nov 24 2008 
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to be an active plan in such plan year or 
any prior plan year, 
‘‘(ii) such defined benefit plan is not 
described in clause (ii) or (iii) of section 
430(c)(2)(G) (modified, if applicable by 
section 107(f)(5) of the Pension Protection 
Act of 2006), 
‘‘(iii) such defined benefit plan is de-
scribed in paragraph (1) or (3) of section 
436(d)(or would be if section 430(g)(3)(C) 
did not apply), and 
‘‘(iv) the nonqualified deferred com-
pensation plan makes any payment in ex-
cess of the amounts that would be per-
mitted if the requirements of such para-
graph (1) or (3), as applicable, applied to 
such plan. 
In the case of a defined benefit plan to which 
section 107 of the Pension Protection Act of 
2006 applies, clauses (iii) and (iv) shall apply 
based on rules similar to the rules of section 
436, as prescribed by the Secretary, except that 
the 
parenthetical 
regarding 
section 
430(g)(3)(C) shall not apply. Under rules pre-
scribed by the Secretary, a plan shall not fail to 
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satisfy the requirements of this subsection sole-
ly by reason of a modification with respect to 
the time and form of distribution that is con-
sistent with the requirements of this subpara-
graph. 
‘‘(C) EXCESS PAYMENTS BY REASON OF 
CERTAIN INTEREST RATES AND MORTALITY AS-
SUMPTIONS.—A payment is described in this 
subparagraph if— 
‘‘(i) the requirements of clauses (i) 
and (ii) of subparagraph (B) are satisfied, 
and 
‘‘(ii) the nonqualified deferred com-
pensation plan makes any payment in ex-
cess of the amount that would be payable 
if such plan used the interest rate and 
mortality assumptions from the defined 
benefit plan described in section 401(a) 
that would create the smallest payments, 
determined on a present value basis using 
the interest rate and mortality assump-
tions described in section 430(h). 
For purposes of this subparagraph, all defined 
benefit plans maintained by the employer shall 
be taken into account.’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after De-
cember 31, 2007. 
SEC. 102. EXPANSION OF CORRIDOR WITHIN WHICH SIN-
GLE-EMPLOYER DEFINED BENEFIT PLANS 
ARE ALLOWED TO AVERAGE ASSET VALUES. 
(a) AMENDMENT TO ERISA.—Paragraph (3) of sec-
tion 303(g) of the Employee Retirement Income Security 
Act of 1974 is amended by adding at the end the following 
new subparagraphs: 
‘‘(C) SPECIAL RULE.—In the case of any 
applicable plan year, subparagraph (B)(iii) shall 
be applied— 
‘‘(i) by substituting ‘80 percent’ for 
‘90 percent’, and 
‘‘(ii) by substituting ‘120 percent’ for 
‘110 percent’. 
‘‘(D) APPLICABLE PLAN YEAR.—For pur-
poses of this paragraph, the term ‘applicable 
plan year’ means— 
‘‘(i) except as provided in clauses (ii) 
and (iii), any plan year beginning in 2009 
or 2010, 
‘‘(ii) in the case of a plan with a plan 
year beginning after October 31 and before 
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January 1, any plan year beginning in 
2008 or 2009, and 
‘‘(iii) in the case of a plan for which 
the valuation date is not the first day of 
the plan year, any plan year beginning in 
2008 or 2009.’’. 
(b) AMENDMENT
TO
INTERNAL REVENUE 
CODE OF 1986.—Paragraph (3) of section 430(g) of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following new subparagraphs: 
‘‘(C) SPECIAL RULE.—In the case of any 
applicable plan year, subparagraph (B)(iii) shall 
be applied— 
‘‘(i) by substituting ‘80 percent’ for 
‘90 percent’, and 
‘‘(ii) by substituting ‘120 percent’ for 
‘110 percent’. 
‘‘(D) APPLICABLE PLAN YEAR.—For pur-
poses of this paragraph, the term ‘applicable 
plan year’ means— 
‘‘(i) except as provided in clauses (ii) 
and (iii), any plan year beginning in 2009 
or 2010, 
‘‘(ii) in the case of a plan with a plan 
year beginning after October 31 and before 
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January 1, any plan year beginning in 
2008 or 2009, and 
‘‘(iii) in the case of a plan for which 
the valuation date is not the first day of 
the plan year, any plan year beginning in 
2008 or 2009.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after De-
cember 31, 2007. 
SEC. 103. LOOKBACK FOR BENEFIT ACCRUAL RESTRIC-
TION. 
(a) AMENDMENT TO ERISA.—Subsection (g) of sec-
tion 206 of the Employee Retirement Income Security Act 
of 1974 is amended by adding at the end thereof the fol-
lowing: 
‘‘(12) SPECIAL RULE FOR CERTAIN YEARS.— 
For purposes of paragraph (4) only— 
‘‘(A) IN GENERAL.—For plan years begin-
ning after October 31, 2008, and before No-
vember 1, 2010, the adjusted funding target at-
tainment percentage of a plan for purposes of 
paragraph (4) shall be the greater of— 
‘‘(i) such percentage, as determined 
without regard to this paragraph, or 
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‘‘(ii) the adjusted funding target at-
tainment percentage for such plan for the 
plan year beginning after October 31, 
2007, and before November 1, 2008, as 
determined under rules prescribed by the 
Secretary of the Treasury. 
‘‘(B) SPECIAL
RULE.—In the case of a 
plan for which the valuation date is not the 
first day of the plan year— 
‘‘(i) subparagraph (A) shall apply to 
plan years beginning after December 31, 
2007, and before January 1, 2010, and 
‘‘(ii) subparagraph (A)(ii) shall apply 
based on the last plan year beginning be-
fore November 1, 2007, as determined 
under rules prescribed by the Secretary of 
the Treasury.’’. 
(b) AMENDMENT
TO
INTERNAL REVENUE 
CODE OF 1986.—Section 436 of the Internal Revenue 
Code of 1986 is amended by adding the following at the 
end thereof: 
‘‘(n) SPECIAL RULE FOR CERTAIN YEARS.—For pur-
poses of subsection (e) only— 
‘‘(1) IN GENERAL.—For plan years beginning 
after October 31, 2008, and before November 1, 
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2010, the adjusted funding target attainment per-
centage of a plan for purposes of subsection (e) shall 
be the greater of— 
‘‘(A) such percentage, as determined with-
out regard to this subsection, or 
‘‘(B) the adjusted funding target attain-
ment percentage for such plan for the plan year 
beginning after October 31, 2007, and before 
November 1, 2008, as determined under rules 
prescribed by the Secretary. 
‘‘(2) SPECIAL RULE.—In the case of a plan for 
which the valuation date is not the first day of the 
plan year— 
‘‘(A) paragraph (1) shall apply to plan 
years beginning after December 31, 2007, and 
before January 1, 2010, and 
‘‘(B) paragraph (1)(B) shall apply based 
on the last plan year beginning before Novem-
ber 1, 2007, as determined under rules pre-
scribed by the Secretary.’’. 
(c) INTERACTION WITH WRERA RULE.—Section 
203 or the Worker, Retiree, and Employer Recovery Act 
of 2008 shall apply to a plan for any plan year in lieu 
of the amendments made by this section only to the extent 
that such section produces a higher adjusted funding tar-
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get attainment percentage for such plan for such year. In 
all other cases, such section shall not be applicable to any 
plan. 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to plan years beginning after October 31, 
2008. 
(2) SPECIAL RULE.—In the case of a plan for 
which the valuation date is not the first day of the 
plan year, the amendments made by this section 
shall apply to plan years beginning after December 
31, 2007. 
SEC. 104. LOOKBACK FOR CREDIT BALANCE RULE. 
(a) AMENDMENT TO ERISA.—Paragraph (3) of sec-
tion 303(f) of the Employee Retirement Income Security 
Act of 1974 is amended by adding the following at the 
end thereof: 
‘‘(D) 
SPECIAL
RULE
FOR
CERTAIN 
YEARS.— 
‘‘(i) IN
GENERAL.—For purposes of 
applying subparagraph (C) for plan years 
beginning after October 31, 2009, and be-
fore November 1, 2011, the ratio deter-
mined under such subparagraph for the 
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preceding plan year shall be the greater 
of— 
‘‘(I) such ratio, as determined 
without regard to this subparagraph, 
or 
‘‘(II) the ratio for such plan for 
the plan year beginning after October 
31, 2007, and before November 1, 
2008, as determined under rules pre-
scribed by the Secretary of the Treas-
ury. 
‘‘(ii) SPECIAL RULE.—In the case of a 
plan for which the valuation date is not the 
first day of the plan year— 
‘‘(I) clause (i) shall apply to plan 
years beginning after December 31, 
2008, and before January 1, 2011, 
and 
‘‘(II) clause (i)(II) shall apply 
based on the last plan year beginning 
before November 1, 2007, as deter-
mined under rules prescribed by the 
Secretary of the Treasury.’’. 
(b) AMENDMENT
TO
INTERNAL REVENUE 
CODE OF 1986.—Paragraph (3) of section 430(f) of the 
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Internal Revenue Code of 1986 is amended by adding the 
following at the end thereof: 
‘‘(D) 
SPECIAL
RULE
FOR
CERTAIN 
YEARS.— 
‘‘(i) IN
GENERAL.—For purposes of 
applying subparagraph (C) for plan years 
beginning after October 31, 2009, and be-
fore November 1, 2011, the ratio deter-
mined under such subparagraph for the 
preceding plan year of a plan shall be the 
greater of— 
‘‘(I) such ratio, as determined 
without regard to this subsection, or 
‘‘(II) the ratio for such plan for 
the plan year beginning after October 
31, 2007 and before November 1, 
2008, as determined under rules pre-
scribed by the Secretary. 
‘‘(ii) SPECIAL RULE.—In the case of a 
plan for which the valuation date is not the 
first day of the plan year— 
‘‘(I) clause (i) shall apply to plan 
years beginning after December 31, 
2007, and before January 1, 2010, 
and 
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‘‘(II) clause (i)(II) shall apply 
based on the last plan year beginning 
before November 1, 2007, as deter-
mined under rules prescribed by the 
Secretary.’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to plan years beginning after October 31, 
2009. 
(2) SPECIAL RULE.—In the case of a plan for 
which the valuation date is not the first day of the 
plan year, the amendments made by this section 
shall apply to plan years beginning after December 
31, 2008. 
SEC. 105. CLARIFICATION OF TREATMENT OF EXPENSES. 
(a) AMENDMENTS TO ERISA.— 
(1) IN
GENERAL.—Clause (ii) of section 
303(b)(1)(A) of the Employee Retirement Income 
Security Act of 1974 is amended by striking ‘‘plan- 
related expenses’’ and inserting ‘‘plan-related admin-
istrative expenses’’. 
(2) CONFORMING AMENDMENT.—Subclause (II) 
of section 303(i)(2)(A)(i) of such Act is amended by 
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striking ‘‘plan-related expenses’’ and inserting 
‘‘plan-related administrative expenses’’. 
(b) AMENDMENTS
TO
INTERNAL REVENUE 
CODE OF 1986.— 
(1) IN
GENERAL.—Clause (ii) of section 
430(b)(1)(A) of the Internal Revenue Code of 1986 
is amended by striking ‘‘plan-related expenses’’ and 
inserting ‘‘plan-related administrative expenses’’. 
(2) CONFORMING AMENDMENT.—Subclause (II) 
of section 430(i)(2)(A)(i) of such Code is amended 
by striking ‘‘plan-related expenses’’ and inserting 
‘‘plan-related administrative expenses’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in paragraphs 
(1)(A), (1)(F)(i), (2)(A), and (2)(F)(i) of section 101(b) 
of the Worker, Retiree, and Employer Recovery Act of 
2008. 
SEC. 106. INFORMATION REPORTING. 
(a) IN GENERAL.—Paragraph (1) of section 4010(b) 
of the Employee Retirement Security Act of 1974 is 
amended by striking ‘‘80’’ and inserting ‘‘90’’. 
(b) FUNDING TARGET ATTAINMENT PERCENTAGE.— 
Subparagraph (B) of section 4010(d)(2) of such Act is 
amended 
by 
striking 
‘‘303(d)(2).’’ 
and 
inserting 
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‘‘303(d)(2), without regard to the reduction under section 
303(f)(4)(B).’’. 
(c) CONFIDENTIALITY.—Subsection (c) of section 
4010 of such Act is amended— 
(1) by striking ‘‘and no such information or 
documentary material may be made public,’’, and 
(2) by adding at the end the following: ‘‘All 
parties, governmental or otherwise, receiving the in-
formation (or summary report of such information) 
required to be provided under this section shall be 
required to— 
‘‘(1) ensure that the information received will 
be kept confidential, 
‘‘(2) use the information only for the purpose 
for which it was requested, and 
‘‘(3) not further disclose the information except 
to accomplish that purpose, unless a separate con-
sent from the taxpayer is obtained. 
Such requirements shall not apply to information provided 
under this section that is otherwise publicly available. The 
corporation shall notify each person providing information 
under this section of any public disclosure of such infor-
mation not permitted by this subsection within a reason-
able time of such disclosure becoming known to the cor-
poration. If any party, governmental or otherwise, makes 
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an unauthorized disclosure, the person required to provide 
such information under this section may bring suit against 
such party in Federal district court. No liability results 
from a disclosure based upon a good faith, but erroneous, 
interpretation of this section. Upon a finding of a liability, 
such person can recover an amount not to exceed 
$100,000 per act of unauthorized disclosure plus reason-
able attorney fees. The person shall have two years from 
the date of discovery of the unauthorized disclosure to 
bring suit.’’. 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to plan years beginning after December 
31, 2009. 
(2) CONFIDENTIALITY.—The amendment made 
by subsection (c) shall take effect on the date of the 
enactment of this Act. 
SEC. 107. BENEFIT RESTRICTION EFFECTIVE DATE FOR 
COLLECTIVELY BARGAINED PLANS. 
(a) AMENDMENTS WITH RESPECT TO ERISA.— 
(1) PLAN
AMENDMENTS.—Paragraph (2) of 
section 103(c) of the Pension Protection Act of 2006 
is amended— 
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(A) by striking ‘‘In the case’’ and inserting 
‘‘Except as provided in paragraph (3), in the 
case’’, and 
(B) by striking ‘‘the amendments made by 
this section’’ and inserting ‘‘section 206(g)(2) 
of the Employee Retirement Income Security 
Act of 1974 (and other provisions of such sec-
tion 206(g) to the extent that they apply to 
such section 206(g)(2)), as added by this sec-
tion,’’. 
(2) OTHER BENEFIT RESTRICTIONS.— 
(A) IN GENERAL.—Subsection (c) of sec-
tion 103 of the Pension Protection Act of 2006 
is amended by adding at the end thereof the 
following: 
‘‘(3) COLLECTIVE BARGAINING DELAY EXCEPT 
REGARDING CERTAIN PLAN AMENDMENTS.— 
‘‘(A) IN GENERAL.—In the case of a plan 
maintained pursuant to 1 or more collective 
bargaining agreements between employee rep-
resentatives and 1 or more employers, the 
amendments made by this section shall apply to 
plan years beginning after December 31, 2011, 
except that paragraph (2) shall apply to plan 
amendments made pursuant to a collective bar-
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gaining agreement ratified after the date of in-
troduction of the Preserve Benefits and Jobs 
Act of 2009. 
‘‘(B) TRANSITION RULE.— 
‘‘(i) In the case of a plan described in 
clause (ii), such plan shall not be required 
to comply with this section and the amend-
ments made by this section until the date 
that is 60 days after the date of the enact-
ment of this paragraph, but such a plan 
may comply on any otherwise permitted 
earlier date. 
‘‘(ii) A plan is described in this clause 
if a limit on benefits or benefit accruals 
has been or is, pursuant to section 206(g) 
of the Employee Retirement Income Secu-
rity Act of 1974 and section 436 of the In-
ternal Revenue Code of 1986, in effect 
with respect to such plan as of the date of 
the enactment of this paragraph.’’. 
(3) CONFORMING AMENDMENT.—The heading 
of paragraph (2) of section 103(c) of the Pension 
Protection Act of 2006 is amended to read as fol-
lows: ‘‘COLLECTIVE
BARGAINING
EXCEPTION
RE-
GARDING CERTAIN PLAN AMENDMENTS’’. 
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(b) AMENDMENTS WITH RESPECT TO INTERNAL 
REVENUE CODE OF 1986.— 
(1) PLAN
AMENDMENTS.—Paragraph (2) of 
section 113(b) of the Pension Protection Act of 
2006 is amended by— 
(A) striking ‘‘In the case’’ and inserting 
‘‘Except as provided in paragraph (3), in the 
case’’, and 
(B) striking ‘‘the amendments made by 
this section’’ and inserting ‘‘section 436(c) of 
the Internal Revenue Code of 1986 (and other 
provisions such section 436 to the extent that 
they apply to such section 436(c)), as added by 
this section,’’. 
(2) OTHER BENEFIT RESTRICTIONS.— 
(A) IN GENERAL.—Subsection (b) of sec-
tion 113 of the Pension Protection Act of 2006 
is amended by adding at the end thereof the 
following: 
‘‘(3) COLLECTIVE BARGAINING DELAY EXCEPT 
REGARDING CERTAIN PLAN AMENDMENTS.— 
‘‘(A) IN GENERAL.—In the case of a plan 
maintained pursuant to 1 or more collective 
bargaining agreements between employee rep-
resentatives and 1 or more employers, the 
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amendments made by this section shall apply to 
plan years beginning after December 31, 2011, 
except that paragraph (2) shall apply to plan 
amendments made pursuant to a collective bar-
gaining agreement ratified after the date of in-
troduction of the Preserve Benefits and Jobs 
Act of 2009. 
‘‘(B) TRANSITION RULE.— 
‘‘(i) In the case of a plan described in 
clause (ii), a plan shall not be required to 
comply with this section and the amend-
ments made by this section until the date 
that is 60 days after the date of the enact-
ment of this paragraph, but such a plan 
may comply on any otherwise permitted 
earlier date. 
‘‘(ii) A plan is described in this clause 
if a limit on benefits or benefit accruals 
has been or is, pursuant to section 206(g) 
of the Employee Retirement Income Secu-
rity Act of 1974 and section 436 of the In-
ternal Revenue Code of 1986, in effect 
with respect to such plan as of the date of 
the enactment of this paragraph.’’. 
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(3) CONFORMING AMENDMENT.—The heading 
of paragraph (2) of section 103(b) of the Pension 
Protection Act of 2006 is amended to read as fol-
lows: ‘‘COLLECTIVE
BARGAINING
EXCEPTION
RE-
GARDING CERTAIN PLAN AMENDMENTS’’. 
(c) EFFECTIVE DATE.—Except as provided in the 
amendments made by this section, the amendments made 
by this section shall apply as if included in sections 103(c) 
and 113(b) of such Act. 
SEC. 108. SOCIAL SECURITY LEVEL-INCOME OPTIONS. 
(a) AMENDMENT TO ERISA.—Subparagraph (E) of 
section 206(g)(3) of the Employee Retirement Income Se-
curity Act of 1974 is amended by adding at the end there-
of the following: 
‘‘For purposes of this paragraph, any stream of pay-
ments that is structured to be similar in amount and 
duration to social security supplements described in 
the last sentence of section 204(b)(1)(G) shall be 
treated in the same manner as such supplements.’’. 
(b) AMENDMENT
TO
INTERNAL REVENUE 
CODE OF 1986.—Paragraph (5) of section 436(d) of the 
Internal Revenue Code of 1986 is amended by adding at 
the end thereof the following: 
‘‘For purposes of this subsection, any stream of payments 
that is structured to be similar in amount and duration 
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to social security supplements described in the last sen-
tence of section 411(a)(9) shall be treated in the same 
manner as such supplements.’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply as if included in sections 103(a) and 
113(a)(1) of the Pension Protection Act of 2006. 
(2) TRANSITION RULE.— 
(A) In the case of a plan described in sub-
paragraph (B), a plan shall not be required to 
comply with the amendments made by this sec-
tion until the date that is 60 days after the 
date of enactment of this Act, but such a plan 
may comply on any otherwise permitted earlier 
date. 
(B) A plan is described in this subpara-
graph (B) if a limit on prohibited payments is 
or has been, pursuant to section 206(g) of the 
Employee Retirement Income Security Act of 
1974 and section 436 of the Internal Revenue 
Code of 1986, in effect with respect to such 
plan as of the date of enactment of this Act. 
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SEC. 109. PBGC GUARANTEE. 
(a) GUARANTEE.—Section 4022 of the Employee re-
tirement Income Security Act of 1974 is amended by 
striking subsection (g). 
(b) ALLOCATION
OF
ASSETS
AMONG
PRIORITY 
GROUPS.—Section 4044 of such Act is amended by strik-
ing subsection (e). 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall be as if included in section 404 of the 
Pension Protection Act of 2006, except that such amend-
ments shall not apply to proceedings initiated under title 
11, United States Code, or under any similar Federal law 
or law of a State or political subdivision, on or before the 
date of enactment of this Act. 
SEC. 110. APPLICATION OF EXTENDED AMORTIZATION PE-
RIOD TO PLANS SUBJECT TO PRIOR LAW 
FUNDING RULES. 
(a) IN GENERAL.—Title I of the Pension Protection 
Act of 2006 is amended by redesignating section 107 as 
section 108 and by inserting the following after section 
106: 
‘‘SEC. 107. APPLICATION OF EXTENDED AMORTIZATION PE-
RIODS TO PLANS WITH DELAYED EFFECTIVE 
DATE. 
‘‘(a) IN GENERAL.—In the case of plans to which sec-
tion 104, 105, or 106 of this Act apply, section 302 of 
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the Employee Retirement Income Security Act of 1974 
and section 412 of the Internal Revenue Code of 1986 
(as in effect before the amendments made by this subtitle 
and subtitle B) shall apply in the manner described in this 
section. All references in this section to ‘such Act’ or ‘such 
Code’ shall be to such Act or such Code as in effect before 
the amendments made by this subtitle and subtitle B. 
‘‘(b) APPLICATION OF 2 AND 7 RULE.— 
‘‘(1) IN GENERAL.—In the case of an active 
plan to which this subsection applies, section 302 of 
such Act and section 412 of such Code shall apply 
in the manner described in this subsection. 
‘‘(2) TWO YEAR SUSPENSION OF DEFICIT RE-
DUCTION
CONTRIBUTIONS
FOR
CERTAIN
PLANS.— 
For purposes of applying section 302(d)(9) of such 
Act and section 412(l)(9) of such Code to a plan de-
scribed in paragraph (1), the funded current liability 
percentage for such plan for any applicable plan 
year shall be the funded current liability percentage 
of such plan for the pre-applicable plan year. 
‘‘(3) CALCULATION
OF
DEFICIT
REDUCTION 
CONTRIBUTION.—For purposes of applying section 
302(d) of such Act and section 412(l) of such Code 
to a plan to which such subsections apply (after tak-
ing into account paragraph (2)), the applicable per-
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centage described in section 302(d)(4)(C) of such 
Act and section 412(l)(4)(C) of such Code shall be 
the third segment rate described in sections 104(b), 
105(b), and 106(b) of this Act, provided that such 
applicable percentage shall only apply to the in-
creased unfunded new liability. The applicable per-
centage determined without regard to this section 
shall apply to the excess of the unfunded new liabil-
ity over the increased unfunded new liability. 
‘‘(c) APPLICATION OF 15-YEAR AMORTIZATION.— 
‘‘(1) IN GENERAL.—In the case of an active 
plan to which this subsection applies, section 302 of 
such Act and section 412 of such Code shall apply 
in the manner described in this subsection. 
‘‘(2) CALCULATION
OF
DEFICIT
REDUCTION 
CONTRIBUTION.—For purposes of applying section 
302(d) of such Act and section 412(l) of such Code 
to a plan described in paragraph (1), the applicable 
percentage described in section 302(d)(4)(C) of such 
Act and section 412(l)(4)(C) of such Code for any 
pre-effective date plan year shall be the ratio of— 
‘‘(A) the annual installments payable in 
each year if the increased unfunded new liabil-
ity for such plan year were amortized over 15 
years, using an interest rate equal to the third 
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segment rate described in sections 104(b), 
105(b), and 106(b) of this Act, to 
‘‘(B) the increased unfunded new liability 
for such plan year. 
However, such applicable percentage shall only apply 
to the increased unfunded new liability. The applica-
ble percentage determined without regard to this 
section shall apply to the excess of the unfunded new 
liability over the increased unfunded new liability. 
‘‘(d) ELECTION.—The plan sponsor may, with re-
spect to a plan, elect whether to apply subsection (b) or 
subsection (c) or whether neither subsection shall apply. 
Such election shall be made at such times, and in such 
form and manner, as shall be prescribed by the Secretary 
of the Treasury, and may be revoked only with the consent 
of the Secretary of the Treasury. In the absence of a time-
ly election regarding which subsection shall apply to a 
plan, neither subsection shall apply to such plan. 
‘‘(e) FAILURE TO MAINTAIN ACTIVE PLAN.—If the 
minimum contribution required for a plan to avoid an ac-
cumulated funding deficiency under section 302 of such 
Act and section 412 of such Code is determined under 
subsection (b) or (c) for a plan year, the plan must remain 
an active plan for the subsequent plan year. If such plan 
fails to be an active plan in such plan year, the minimum 
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contribution requirement to avoid an accumulated funding 
deficiency shall be increased by all amounts by which such 
minimum contribution was reduced by the application of 
subsection (b) or (c), plus interest on such amounts at 
the third segment rate described in sections 104(b), 
105(b), and 106(b) of this Act. However, any such in-
crease in such minimum contribution shall not require a 
contribution to the extent that the contribution would 
cause the value of plan assets (determined under section 
302(c)(2) of such Act and section 412(c)(2) of such Code) 
to exceed the current liability of such plan for such year. 
‘‘(f) DEFINITIONS.— 
‘‘(1) APPLICABLE PLAN YEAR.—For purposes 
of this section, the term ‘applicable plan year’ 
means— 
‘‘(A) except as provided in subparagraphs 
(B), (C), and (D), any plan year beginning in 
2010 or 2011, 
‘‘(B) in the case of a plan with a plan year 
beginning after June 30 and before January 1, 
any plan year beginning in 2009 or 2010, 
‘‘(C) in the case of a plan for which the 
valuation date is not the first day of the plan 
year, any plan year beginning in 2009 or 2010, 
and 
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‘‘(D) in the case of a plan to which section 
106 of the Pension Protection Act of 2006 ap-
plies, subparagraphs (A), (B), and (C) shall be 
applied by inserting ‘2008’, ‘2009’, or ‘2010’ 
for ‘2009’, ‘2010’, or ‘2011’, respectively, each 
place such year is referenced. 
‘‘(2) PRE-APPLICABLE PLAN YEAR.—For pur-
poses of this section, the term ‘pre-applicable plan 
year’ means, with respect to a plan, the second plan 
year preceding the first applicable plan year of such 
plan, except that in the case of a plan described in 
paragraph (1)(D), such term means the first plan 
year preceding the first applicable plan year of such 
plan. 
‘‘(3) PRE-EFFECTIVE DATE PLAN YEAR.—For 
purposes of this section, the term ‘pre-effective date 
plan year’ means, with respect to a plan, any plan 
year prior to the first year in which the amendments 
made by this subtitle and subtitle B apply to the 
plan, provided that the first pre-effective date plan 
year shall be the first applicable plan year with re-
spect to the plan. 
‘‘(4) INCREASED UNFUNDED NEW LIABILITY.— 
For purposes of this section, the term ‘increased un-
funded new liability’ means, with respect to a year, 
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the excess (if any) of the unfunded new liability over 
the amount of unfunded new liability determined as 
if the value of the plan’s assets determined under 
subsection 302(c)(2) of such Act and section 
412(c)(2) of such Code equaled the product of the 
current liability of the plan for the year multiplied 
by the funded current liability percentage of the plan 
for the pre-applicable plan year. 
‘‘(5) ACTIVE PLAN.—For purposes of this sec-
tion, the term ‘active plan’ shall have the meaning 
given such term by section 303(c)(2)(G) of the Em-
ployee Retirement Income Security Act of 1974 and 
in section 430(c)(2)(G) of the Internal Revenue 
Code of 1986, except that ‘target normal cost’ (with-
out regard to plan administrative expenses) shall be 
determined as if section 303 of the Employee Retire-
ment Income Security Act of 1974 and section 430 
of the Internal Revenue Code of 1986 applied to 
such plan with the modification regarding the inter-
est rate used, as set forth in section 303(c)(2)(G) of 
the Employee Retirement Income Security Act of 
1974 and in section 430(c)(2)(G) of the Internal 
Revenue Code of 1986. 
‘‘(6) OTHER
DEFINITIONS.—For purposes of 
this section, the terms ‘funded current liability per-
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centage’, ‘unfunded new liability’, and ‘current liabil-
ity’ shall have the meanings set forth in section 
302(d) of such Act and section 412(l) of such 
Code.’’. 
(b) ELIGIBLE CHARITY PLANS.—Section 104 of the 
Pension Protection Act of 2006 is amended by— 
(1) striking ‘‘eligible cooperative plan’’ wherever 
it appears in subsections (a) and (b) and inserting 
‘‘eligible cooperative plan or an eligible charity 
plan’’, and 
(2) adding at the end the following new sub-
section: 
‘‘(d) ELIGIBLE CHARITY PLAN DEFINED.—For pur-
poses of this section, a plan shall be treated as an eligible 
charity plan for a plan year if the plan is maintained by 
more than one employer and 100 percent of the employers 
are described in section 501(c)(3) of such Code.’’. 
(c) EFFECTIVE DATE.— 
(1) IN
GENERAL.—The amendment made by 
subsection (a) shall take effect as if included in the 
Pension Protection Act of 2006. 
(2) ELIGIBLE
CHARITY
PLAN.—The amend-
ments made by subsection (b) shall apply to plan 
years beginning after December 31, 2008. 
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SEC. 111. ADDITIONS TO FUNDING-BASED LIMITS ON BENE-
FITS AND BENEFITS ACCRUALS UNDER SIN-
GLE-EMPLOYER PLANS. 
(a) AMENDMENTS
TO
INTERNAL REVENUE 
CODE OF 1986.— 
(1) Subsection (c) of section 436 of the Internal 
Revenue Code of 1986 is amended by redesignating 
paragraph (3) as paragraph (4) and by inserting 
after paragraph (2) the following: 
‘‘(3) SPECIAL LIMITATIONS ON AD HOC AMEND-
MENTS.— 
‘‘(A) IN GENERAL.—No ad hoc amendment 
to a defined benefit plan which is a single em-
ployer plan which has the effect of increasing li-
abilities of the plan by reason of increases in 
benefits, establishment of new benefits, chang-
ing the rate of benefit accrual, or changing the 
rate of which benefits become nonforfeitable 
may take effect during the plan year if the ad-
justed funding target attainment percentage for 
such plan year is— 
‘‘(i) less than 120 percent, or 
‘‘(ii) would be less than 120 percent 
taking into account such amendment. 
‘‘(B) 
EXEMPTION.—Subparagraph 
(A) 
shall cease to apply with respect to any plan 
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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 (in addition to any minimum 
required contribution under section 430) equal 
to— 
‘‘(i) in the case of subparagraph 
(A)(i), the amount of the increase in the 
funding target of the plan (under section 
430) for the plan year attributable to the 
amendment, and 
‘‘(ii) in the case of subparagraph 
(A)(ii), the amount sufficient to result in 
an adjusted funding target attainment per-
centage of 120 percent. 
‘‘(C) SPECIAL RULE.—An ad hoc amend-
ment that is otherwise permitted to take effect 
under this subsection may not take effect unless 
the plan provides that the accrued pension ben-
efits of any participant or beneficiary under the 
plan become nonforfeitable in the same manner 
which would be required if the plan had termi-
nated as of the effective date of such ad hoc 
amendment. This subparagraph shall not apply 
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to an ad hoc amendment that takes effect by 
reason of subparagraph (B)(i). 
‘‘(D) AD HOC AMENDMENT.—For purposes 
of this paragraph, the term ‘ad hoc amendment’ 
means an amendment to a plan which— 
‘‘(i) increases the nonforfeitable bene-
fits payable to one or more participants, 
‘‘(ii) applies only to a subset of the 
employees otherwise eligible to accrue ben-
efits under the plan, 
‘‘(iii) applies by its terms only to em-
ployees who, during a limited period of 
time, terminate employment, and 
‘‘(iv) provides that the increase de-
scribed in clause (i) is payable in the form 
of a prohibited payment (as defined in sub-
section (d)(5)).’’. 
(2) Paragraph (4) of section 436(c) of such 
Code, as redesignated by paragraph (1), is amend-
ed— 
(A) by inserting ‘‘(A)’’ before ‘‘Paragraph 
(1)’’ and moving the text thereof 2 ems to the 
right, and 
(B) by adding at the end the following: 
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‘‘(B) Paragraph (3) shall not apply to any 
amendment of a plan maintained pursuant to 1 
or more collective bargaining agreements be-
tween employee representatives and 1 or more 
employers.’’. 
(b) AMENDMENTS TO ERISA.— 
(1) Paragraph (2) of section 206(g) of the Em-
ployee Retirement Income Security Act of 1974 is 
amended by redesignating subparagraph (C) as sub-
paragraph (D) and by inserting after subparagraph 
(B) the following: 
‘‘(C) SPECIAL
LIMITATIONS
ON
AD
HOC 
AMENDMENTS.— 
‘‘(i) IN GENERAL.—No ad hoc amend-
ment to a defined benefit plan which is a 
single employer plan which has the effect 
of increasing liabilities of the plan by rea-
son of increases in benefits, establishment 
of new benefits, changing the rate of ben-
efit accrual, or changing the rate of which 
benefits become nonforfeitable may take ef-
fect during the plan year if the adjusted 
funding target attainment percentage for 
such plan year is— 
‘‘(I) less than 120 percent, or 
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‘‘(II) would be less than 120 per-
cent taking into account such amend-
ment. 
‘‘(ii) EXEMPTION.—Clause (i) 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 (in addition 
to any minimum required contribution 
under section 303) equal to— 
‘‘(I) in the case of clause (i)(I), 
the amount of the increase in the 
funding target of the plan (under sec-
tion 303) for the plan year attrib-
utable to the amendment, and 
‘‘(II) in the case of clause (i)(II), 
the amount sufficient to result in an 
adjusted funding target attainment 
percentage of 120 percent. 
‘‘(iii) SPECIAL
RULE.—An ad hoc 
amendment that is otherwise permitted to 
take effect under this paragraph may not 
take effect unless the plan provides that 
the accrued pension benefits of any partici-
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pant or beneficiary under the plan become 
nonforfeitable in the same manner which 
would be required if the plan had termi-
nated as of the effective date of such ad 
hoc amendment. This subparagraph shall 
not apply to an ad hoc amendment that 
takes effect by reason of clause (ii)(I). 
‘‘(iv) AD
HOC
AMENDMENT.—For 
purposes of this subparagraph, the term 
‘ad hoc amendment’ means an amendment 
to a plan which— 
‘‘(I) increases the nonforfeitable 
benefits payable to one or more par-
ticipants, 
‘‘(II) applies only to a subset of 
the employees otherwise eligible to ac-
crue benefits under the plan, 
‘‘(III) applies by its terms only to 
employees who, during a limited pe-
riod of time, terminate employment, 
and 
‘‘(IV) provides that the increase 
described in subclause (I) is payable 
in the form of a prohibited payment 
(as defined in paragraph (3)(E)).’’. 
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(2) Subparagraph (D) of section 202(g)(2) of 
such Act, as redesignated by paragraph (1), is 
amended— 
(A) by inserting ‘‘(i)’’ before ‘‘Subpara-
graph (A)’’ and moving the text thereof 2 ems 
to the right, and 
(B) by adding at the end the following: 
‘‘(ii) Subparagraph (C) shall not 
apply to any amendment of a plan main-
tained pursuant to 1 or more collective 
bargaining agreements between employee 
representatives and 1 or more employers.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan amendments adopted more 
than 180 days after the date of the enactment of this Act. 
SEC. 112. REPORTABLE EVENTS. 
(a) IN GENERAL.—Section 4043 of the Employee Re-
tirement Income Security Act of 1974 is amended by re-
designating subsection (f) as subsection (g) and by insert-
ing after subsection (e) the following: 
‘‘(f) SPECIAL RULE.— 
‘‘(1) IN
GENERAL.—A reportable event de-
scribed in paragraph (3) of subsection (c) (without 
regard to this subsection) shall not be treated as oc-
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curring with respect to a plan for an applicable plan 
year if— 
‘‘(A) the number of employees of the con-
tributing sponsor is at least 80 percent of the 
number of employees of the contributing spon-
sor at the beginning of the plan year, and is at 
least 75 percent of the number of employees of 
the contributing sponsor at the beginning of the 
previous plan year, 
‘‘(B) the funded vested benefit percentage 
(as 
defined 
for 
purposes 
of 
subsection 
(b)(1)(B)) for the pre-applicable plan year was 
at least 80 percent, and 
‘‘(C) the contributing sponsor notifies the 
corporation of the use of the rule described in 
this subsection by the date that such contrib-
uting sponsor would (but for this subsection) be 
required to notify the corporation of an event 
described in subsection (c)(3). 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) EMPLOYEE.—The term ‘employee’ 
means, in connection with a contributing spon-
sor, an employee of the contributing sponsor or 
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of any member of such sponsor’s controlled 
group. 
‘‘(B) APPLICABLE PLAN YEAR.—The term 
‘applicable plan year’ means— 
‘‘(i) except as provided in this sub-
paragraph, any plan year beginning in 
2010 or 2011, 
‘‘(ii) in the case of a plan with a plan 
year beginning after October 31 and before 
January 1, any plan year beginning in 
2009 or 2010, and 
‘‘(iii) in the case of a plan for which 
the valuation date is not the first day of 
the plan year, any plan year beginning in 
2009 or 2010. 
‘‘(C) PRE-APPLICABLE PLAN YEAR.—The 
term ‘pre-applicable plan year’ means, in con-
nection with a plan, the second plan year pre-
ceding the first applicable plan year of such 
plan.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
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TITLE II—MULTIEMPLOYER 
PLANS 
SEC. 201. ADJUSTMENTS TO FUNDING STANDARD ACCOUNT 
RULES; REPORTING CLARIFICATION. 
(a) AMORTIZATION PERIODS.— 
(1) AMENDMENT TO ERISA.—Section 304(b) of 
the Employee Retirement Income Security Act of 
1974 is amended by adding at the end the following 
new paragraph: 
‘‘(8) ELECTIVE SPECIAL RELIEF RULES.— 
‘‘(A) PLAN SPONSOR ELECTION.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of this subsection, ef-
fective with the actuarial valuation for ei-
ther of the first two plan years beginning 
after August 31, 2008, the plan sponsor of 
a multiemployer plan that meets the sol-
vency test in subparagraph (B) may elect 
to use either the rule in clause (ii) or the 
rule in clause (iii) in maintaining its fund-
ing standard account. 
‘‘(ii) COMBINED
OUTSTANDING
BAL-
ANCE.—Under this clause, the outstanding 
balances of all amounts required to be am-
ortized under both paragraph (2) and 
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paragraph (3) may be combined into one 
amount under each such paragraph, to be 
amortized in equal annual installments 
(until fully amortized) over a period of 30 
plan years. 
‘‘(iii) 
CERTAIN
INVESTMENT 
LOSSES.—Under this clause, the total 
amount of the net investment losses, if 
any, incurred in either or both of the first 
two plan years ending after August 31, 
2008, may be charged as an item separate 
from other experience losses and amortized 
in equal annual installments (until fully 
amortized) over a period of 30 plan years. 
‘‘(B) SOLVENCY TEST.—An election may 
be made under this paragraph if the plan actu-
ary certifies that the plan is projected to have 
sufficient assets to timely pay expected benefits 
and anticipated expenditures over the amortiza-
tion period as extended. 
‘‘(C) 
RESTRICTION
ON
BENEFIT
IN-
CREASES.—In the case of a plan for which a 
rule described in subparagraph (A) is elected, in 
addition to any other applicable restrictions on 
benefit increases, an amendment increasing 
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benefits may not go into effect during the pe-
riod of two plan years immediately following the 
plan year for which the rule is first effective, 
unless— 
‘‘(i) the plan actuary certifies that 
such increase is paid for out of additional 
contributions not allocated to the plan at 
the time the election was made and the 
plan’s funded percentage and projected 
credit balances for those two plan years 
are reasonably expected to be generally at 
the same levels as they would have been if 
the benefit increase had not been adopted, 
or 
‘‘(ii) the amendment is required as a 
condition of qualification under part I of 
subchapter D of chapter 1 of the Internal 
Revenue Code of 1986 or to comply with 
other applicable law.’’. 
(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Section 431(b) of the Internal Revenue 
Code of 1986 is amended by adding at the end the 
following new paragraph: 
‘‘(8) ELECTIVE SPECIAL RELIEF RULES.— 
‘‘(A) PLAN SPONSOR ELECTION.— 
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‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of this subsection, ef-
fective starting with the actuarial valuation 
for either of the first two plan years begin-
ning after August 31, 2008, the plan spon-
sor of a multiemployer plan that meets the 
solvency test in subparagraph (B) may 
elect to use either the rule in clause (ii) or 
the rule in clause (iii) in maintaining its 
funding standard account. 
‘‘(ii) COMBINED
OUTSTANDING
BAL-
ANCE.—Under this clause, the outstanding 
balances of all amounts required to be am-
ortized under both paragraph (2) and 
paragraph (3) may be combined into one 
amount under each such paragraph, to be 
amortized in equal annual installments 
(until fully amortized) over a period of 30 
plan years. 
‘‘(iii) 
CERTAIN
INVESTMENT 
LOSSES.—Under this clause, the total 
amount of the net investment losses, if 
any, incurred in either or both of the first 
two plan years ending after August 31, 
2008, may be charged as an item separate 
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from other experience losses and amortized 
in equal annual installments (until fully 
amortized) over a period of 30 plan years. 
‘‘(B) SOLVENCY TEST.—An election may 
be made under this paragraph if the plan actu-
ary certifies that the plan is projected to have 
sufficient assets to timely pay expected benefits 
and anticipated expenditures over the amortiza-
tion period as extended. 
‘‘(C) 
RESTRICTION
ON
BENEFIT
IN-
CREASES.—In the case of a plan for which a 
rule described in subparagraph (A) is elected, in 
addition to any other applicable restrictions on 
benefit increases, an amendment increasing 
benefits may not go into effect during the pe-
riod of two plan years immediately following the 
plan year for which the rule is first effective, 
unless— 
‘‘(i) the plan actuary certifies that 
such increase is paid for out of additional 
contributions not allocated to the plan 
when the election was made and the plan’s 
funded percentage and projected credit bal-
ances for those two plan years are reason-
ably expected to be generally at the same 
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levels as they would have been if the ben-
efit increase had not been adopted, or 
‘‘(ii) the amendment is required as a 
condition of qualification under part I of 
subchapter D of chapter 1 or to comply 
with other applicable law.’’. 
(b) AUTOMATIC AMORTIZATION EXTENSIONS.— 
(1) 
AMENDMENT
TO
ERISA.—Section 
304(d)(1)(A) of the Employee Retirement Income 
Security Act of 1974 is amended— 
(A) by striking ‘‘(not in excess of 5 years)’’ 
and inserting ‘‘(not in excess of 10 years)’’, and 
(B) by redesignating subparagraph (C) as 
subparagraph (D) and inserting after subpara-
graph (B) the following new subparagraph: 
‘‘(C) DEEMED APPROVAL.— 
‘‘(i) IN
GENERAL.—An application 
under this paragraph shall be deemed ap-
proved unless, within 45 days after it is 
submitted, the Secretary notifies the plan 
sponsor that the actuary has failed to cer-
tify to one or more of the criteria listed in 
subparagraph (B). 
‘‘(ii) CORRECTIONS.—If, within 30 
days after receiving a notice under this 
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subparagraph, the plan sponsor corrects 
any omissions identified in the notice 
under this subparagraph or otherwise dem-
onstrates that the actuary’s certification 
satisfies subparagraph (B), the application 
shall be deemed approved.’’. 
(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Section 431(d)(1)(A) of the Internal Rev-
enue Code of 1986 is amended— 
(A) by striking ‘‘(not in excess of 5 years)’’ 
and inserting ‘‘(not in excess of 10 years)’’, and 
(B) by redesignating subparagraph (C) as 
subparagraph (D) and inserting after subpara-
graph (B) the following new subparagraph: 
‘‘(C) DEEMED APPROVAL.— 
‘‘(i) IN
GENERAL.—An application 
under this paragraph shall be deemed ap-
proved unless, within 45 days after it is 
submitted, the Secretary notifies the plan 
sponsor that the actuary has failed to cer-
tify to one or more of the criteria listed in 
subparagraph (B). 
‘‘(ii) CORRECTIONS.—If, within 30 
days after receiving a notice under this 
subparagraph, the plan sponsor corrects 
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any omissions identified in the notice 
under this subparagraph or otherwise dem-
onstrates that the actuary’s certification 
satisfies subparagraph (B), the application 
shall be deemed approved.’’. 
(c) EXTENDED SMOOTHING PERIOD
AND WIDER 
ASSET VALUATION CORRIDOR FOR CERTAIN LOSSES.— 
(1) IN GENERAL.— 
(A) The Secretary of the Treasury shall 
not treat the asset valuation method of a multi-
employer plan as unreasonable solely because 
the plan elects to use either or both of the op-
tions described in subparagraph (B) or (C). A 
plan may elect to use any or all of such options. 
The election of such options shall apply for pur-
poses of sections 431 and 432 of the Internal 
Revenue Code of 1986. 
(B) With respect to net investment losses 
incurred in either or both of the first two plan 
years ending after August 31, 2008, the plan 
may utilize a smoothing period of not more 
than ten years. 
(C) For either or both of the first two plan 
years beginning after August 31, 2008, the 
asset value reflected by the method may not be 
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more than 130 percent of the current fair mar-
ket value. 
(2) DEEMED
APPROVAL.—The election by a 
plan of either or both of the options described in 
paragraph (1) shall be deemed approved by the Sec-
retary of the Treasury under section 412(d)(1) of 
the Internal Revenue Code of 1986. 
(d) MODIFICATION OF CERTAIN AMORTIZATION EX-
TENSIONS UNDER PRIOR LAW.—Any amortization exten-
sions under the terms of section 412(e) of the Internal 
Revenue Code of 1986 (prior to enactment of the Pension 
Protection Act of 2006) that were granted to multiem-
ployer plans shall remain in effect notwithstanding the im-
pact of investment losses incurred by the plans in 2008, 
2009 or 2010, unless the plan sponsor elects otherwise. 
(e) CLARIFICATION OF MULTIEMPLOYER REPORTING 
AND
DISCLOSURE
REQUIREMENTS.—Sections 
103(f)(2)(C) and 104(d)(1)(D) of the Employee Retire-
ment Income Security Act of 1974 are both amended by 
striking ‘‘as an employer of the participant’’. 
(f) EFFECTIVE DATE.— 
(1) The amendments made by this section shall 
take effect as of the first day of the first plan year 
beginning after August 31, 2008, provided however 
that any election a plan makes pursuant to this sec-
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tion that affects the plan’s funding standard account 
for the first plan year beginning after August 31, 
2008 shall be disregarded for purposes of applying 
the provisions of section 305 of the Employee Re-
tirement Income Security Act of 1974 and section 
432 of the Internal Revenue Code of 1986 to that 
plan year. 
(2) Notwithstanding paragraph (1), the restric-
tions on plan amendments increasing benefits in sec-
tions 304(b)(8)(C) of the ERISA and 431(b)(8)(C) 
of the Internal Revenue Code, as added by this sec-
tion, shall be effective 30 days after the date of en-
actment of this Act. 
SEC. 202. MULTIEMPLOYER PLANS IN ENDANGERED OR 
CRITICAL STATUS. 
(a) OPTIONAL LONGER CORRECTION PERIODS.— 
(1) AMENDMENT TO ERISA.— 
(A) FUNDING
IMPROVEMENT
PERIOD.— 
Section 305(c)(4) of the Employee Retirement 
Income Security Act of 1974 is amended by re-
designating subparagraphs (C) and (D) as sub-
paragraphs (D) and (E), respectively, and by 
inserting after subparagraph (B) the following 
new subparagraph: 
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‘‘(C) ELECTION TO EXTEND PERIOD.—The 
plan sponsor of an endangered or seriously en-
dangered plan may elect to extend the applica-
ble funding improvement period by up to 5 
years, including any extension of the period pre-
viously elected pursuant to section 205 of the 
Worker, Retiree and Employer Relief Act of 
2008.’’. 
(B) REHABILITATION
PERIOD.—Section 
305(e)(4) of such Act is amended by redesig-
nating subparagraph (B) as subparagraph (C) 
and by inserting after subparagraph (A) the fol-
lowing new subparagraph: 
‘‘(B) ELECTION TO EXTEND PERIOD.—The 
plan sponsor of a plan in critical status may 
elect to extend the rehabilitation period by up 
to five years, including any extension of the pe-
riod previously elected pursuant to section 205 
of the Worker, Retiree and Employer Relief Act 
of 2008.’’. 
(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.— 
(A) FUNDING
IMPROVEMENT
PERIOD.— 
Section 432(c)(4) of the Internal Revenue Code 
of 1986 is amended by redesignating subpara-
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graphs (C) and (D) as subparagraphs (D) and 
(E), respectively, and by inserting after sub-
paragraph (B) the following new subparagraph: 
‘‘(C) ELECTION TO EXTEND PERIOD.—The 
plan sponsor of an endangered or seriously en-
dangered plan may elect to extend the applica-
ble funding improvement period by up to 5 
years, including any extension of the period pre-
viously elected pursuant to section 205 of the 
Worker, Retiree and Employer Relief Act of 
2008.’’. 
(B) REHABILITATION
PERIOD.—Section 
432(e)(4) of such Code is amended by redesig-
nating subparagraph (B) as subparagraph (C) 
and by inserting after subparagraph (A) the fol-
lowing new subparagraph: 
‘‘(B) ELECTION TO EXTEND PERIOD.—The 
plan sponsor of a plan in critical status may 
elect to extend the rehabilitation period by up 
to five years, including any extension of the pe-
riod previously elected pursuant to section 205 
of the Worker, Retiree and Employer Relief Act 
of 2008.’’. 
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(b) SIMPLIFICATION
OF
THE FUNDING IMPROVE-
MENT PERIOD FOR CERTAIN SERIOUSLY ENDANGERED 
PLANS.— 
(1) AMENDMENT TO ERISA.—Section 305(c) of 
the Employee Retirement Income Security Act of 
1974 is amended— 
(A) by striking paragraph (5) and redesig-
nating paragraph (6) as paragraph (5), and 
(B) in paragraph (1) by striking ‘‘(as 
modified by paragraph (5))’’. 
(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Section 432(c) of the Internal Revenue 
Code of 1986 is amended— 
(A) by striking paragraph (5) and redesig-
nating paragraph (6) as paragraph (5), and 
(B) in paragraph (1) by striking ‘‘(as 
modified by paragraph (5))’’. 
(c) SOCIAL SECURITY LEVEL INCOME OPTION.— 
(1) AMENDMENT
TO
ERISA.—Subparagraph 
(B)(i) of section 305(f)(2) of the Employee Retire-
ment Income Security Act of 1974 is amended by 
striking 
‘‘204(b)(1)(G)),’’ 
and 
inserting 
‘‘204(b)(1)(G) or any stream of payments that is 
structured to be similar in amount and duration to 
such supplements),’’. 
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(2) AMENDMENT TO INTERNAL REVENUE CODE 
OF 1986.—Subparagraph (A)(i) of section 432(f)(2) 
of the Internal Revenue Code of 1986 is amended by 
striking 
‘‘411(b)(1)(A)),’’ 
and 
inserting 
‘‘411(b)(1)(A) or any stream of payments that is 
structured to be similar in amount and duration to 
such supplements),’’. 
(3) EFFECTIVE DATE.— 
(A) IN GENERAL.—Except as provided in 
paragraph (2), the amendments made by this 
subsection shall apply as if included in sections 
202(a) and 212(a) of the Pension Protection 
Act of 2006. 
(B) TRANSITION RULE.— 
(i) In the case of a plan described in 
clause (ii), a plan shall not be required to 
comply with the amendments made by this 
section until the date that is 60 days after 
the date of enactment of this Act, but such 
a plan may comply on any otherwise per-
mitted earlier date. 
(ii) A plan is described in this clause 
if a restriction on benefit payments is or 
has been imposed, pursuant to section 
305(f) of the Employee Retirement Income 
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security Act of 1974 and section 432(f) of 
the Internal Revenue Code of 1986, in ef-
fect with respect to such plan as of the 
date of enactment of this Act. 
(d) TECHNICAL CORRECTIONS.— 
(1) AMENDMENTS TO ERISA.—Section 305(c) of 
the Employee Retirement Income Security Act of 
1974 is amended— 
(A) in paragraph (1)(B)(i)— 
(i) by striking ‘‘plan, including—’’ 
and all that follows through ‘‘one proposal 
for reductions’’ and inserting ‘‘plan, in-
cluding one proposal for reductions’’, 
(ii) by striking ‘‘, and’’ at the end of 
subclause (I) and inserting a period, and 
(iii) by striking subclause (II), 
(B) in paragraph (7)(A), by striking 
‘‘(1)(B)(i)(I)’’ and inserting ‘‘(1)(B)(i)’’, 
(C) in paragraph (4) by adding at the end 
the following: 
‘‘(E) PLANS THAT ACHIEVE FUNDING IM-
PROVEMENT BENCHMARKS WHILE IN ENDAN-
GERED OR SERIOUSLY ENDANGERED STATUS.— 
If the plan’s actuary certifies under subsection 
(b)(3)(A) that the plan has achieved the appli-
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cable increase in the funding percentage de-
scribed in paragraph (3) of this subsection and 
that the plan is nevertheless still in endangered 
status, the provisions of this subsection and 
subsection (d) shall remain in effect until the 
earlier of the expiration of the funding improve-
ment period or the last day preceding the plan 
year for which the actuary certifies that the 
plan is no longer in endangered status.’’, and 
(D) in paragraph (4)(C)(ii) by striking all 
that follows ‘‘whichever is applicable,’’ and in-
serting the following: ‘‘shall end as of the close 
of the preceding plan year, except that, until 
the start of the rehabilitation plan adoption pe-
riod— 
‘‘(I) the rules of subparagraphs 
(A) and (B) of subsection (d)(1) shall 
apply if, prior to the date the of the 
critical-status certification, the plan 
was in the funding improvement plan 
adoption period for the plan year, and 
‘‘(II) the rules of subsection 
(d)(2) shall apply if, prior to the date 
of the critical-status certification, the 
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plan was in the funding improvement 
period for the plan year.’’. 
(2) AMENDMENTS
TO
INTERNAL
REVENUE 
CODE OF 1986.—Section 432(c) of the Internal Rev-
enue Code of 1986 is amended— 
(A) in paragraph (1)(B)(i)— 
(i) by striking ‘‘plan, including—’’ 
and all that follows through ‘‘one proposal 
for reductions’’ and inserting ‘‘plan, in-
cluding one proposal for reductions’’, 
(ii) by striking ‘‘, and’’ at the end of 
subclause (I) and inserting a period, and 
(iii) by striking subclause (II), 
(B) in paragraph (7)(A), by striking 
‘‘(1)(B)(i)(I)’’ and inserting ‘‘(1)(B)(i)’’, 
(C) in paragraph (4) by adding at the end 
the following: 
‘‘(E) PLANS THAT ACHIEVE FUNDING IM-
PROVEMENT BENCHMARKS WHILE IN ENDAN-
GERED OR SERIOUSLY ENDANGERED STATUS.— 
If the plan’s actuary certifies under subsection 
(b)(3)(A) that the plan has achieved the appli-
cable increase in the funding percentage de-
scribed in paragraph (3) of this subsection and 
that the plan is nevertheless still in endangered 
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status, the provisions of this subsection and 
subsection (d) shall remain in effect until the 
earlier of the expiration of the funding improve-
ment period or the last day preceding the plan 
year for which the actuary certifies that the 
plan is no longer in endangered status.’’, and 
(D) in paragraph (4)(C)(ii) by striking all 
that follows ‘‘whichever is applicable,’’ and in-
serting the following: ‘‘shall end as of the close 
of the preceding plan year, except that, until 
the start of the rehabilitation plan adoption pe-
riod— 
‘‘(I) the rules of subparagraphs 
(A) and (B) of subsection (d)(1) shall 
apply if, prior to the date the of the 
critical-status certification, the plan 
was in the funding improvement plan 
adoption period for the plan year, and 
‘‘(II) the rules of subsection 
(d)(2) shall apply if, prior to the date 
of the critical-status certification, the 
plan was in the funding improvement 
period for the plan year.’’. 
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SEC. 203. MULTIEMPLOYER PLAN MERGERS AND ALLI-
ANCES. 
(a) MULTIEMPLOYER PLAN ALLIANCES.— 
(1) AMENDMENTS TO ERISA.— 
(A) Section 4231 of the Employee Retire-
ment Income Security Act of 1974 is amended 
by adding at the end the following new sub-
section: 
‘‘(e) MULTIEMPLOYER PLAN ALLIANCES.— 
‘‘(1) IN GENERAL.—The plan sponsor of a mul-
tiemployer plan into which another multiemployer 
plan has been merged may designate the merger as 
an alliance to which the rules of this subsection 
apply by amending the plan— 
‘‘(A) to identify the allied plan, and 
‘‘(B) to delineate the terms of operation of 
the alliance, including the allocation of em-
ployer contributions and experience gains and 
losses between the merged plan and the par-
tially separate frozen allied plan described in 
paragraphs (2) and (3). 
‘‘(2) APPLICABLE PROVISIONS.—Except to the 
extent otherwise provided in the plan amendment 
under paragraph (1), sections 302, 304 and 305 
(minimum funding), Part 1 of Subtitle E (with-
drawal liability), sections 4244A and 4281 (plan ter-
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mination), part 3 of subtitle E (plan reorganization 
and insolvency) and section 4261 (financial assist-
ance from the corporation) shall apply to the frozen 
allied plan and the plan into which the allied plan 
was merged as if they were separate plans. 
‘‘(3) FROZEN ALLIED PLAN TREATED AS SEPA-
RATE PLAN.— 
‘‘(A) ASSETS AND LIABILITIES.—The fro-
zen allied plan that is treated in part as a sepa-
rate plan pursuant to this paragraph comprises 
the assets and liabilities of the allied plan as if 
it had been amended, effective immediately be-
fore the effective date of the merger, to cease 
all benefit accruals. 
‘‘(B) EMPLOYERS
MAINTAINING
PLAN.— 
The employers that were obligated to contribute 
to the allied plan immediately before the effec-
tive date of the merger, and any successors 
thereto whether by sale, reorganization or oth-
erwise, shall be considered to be the employers 
maintaining the partially separate frozen allied 
plan, to the extent they continue to have an ob-
ligation to contribute with respect to partici-
pants or facilities covered by the allied plan. 
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‘‘(C) 
PARTICIPANTS
AND
BENE-
FICIARIES.—The participants and beneficiaries 
of the allied plan immediately before the effec-
tive date of the merger shall be considered to 
be the participants and beneficiaries of the par-
tially separate frozen allied plan thereafter. 
‘‘(4) TREATMENT OF MERGED PLAN AS SINGLE 
PLAN.—Except as provided in paragraphs (2) and 
(3), the allied plan and the plan into which it has 
been merged shall be treated as a single plan. 
‘‘(5) OTHER RULES.— 
‘‘(A) ADOPTION OF INITIAL PLAN AMEND-
MENT.—The plan amendment initially desig-
nating a merger as an alliance, identifying the 
allied plan and delineating the terms of the alli-
ance must be adopted by no later than the last 
day of the plan year in which the merger takes 
effect. 
‘‘(B) SUBSEQUENT
AMENDMENTS.—That 
initial plan amendment may subsequently be 
modified or repealed, except that the plan gives 
notice of the change to the employers and par-
ticipants of the allied plan at least 15 days be-
fore the subsequent amendment takes effect. 
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‘‘(C) DISCRETION
TO
TREAT
MERGERS 
DIFFERENTLY.—The plan sponsor of a multi-
employer plan may, in its discretion, treat some 
mergers as alliances and others as full mergers, 
and may prescribe different terms of operation 
for different alliances, if the basis for the dis-
tinctions is not unreasonable.’’. 
(B) Subsection (b) of section 4231 of such 
Act is amended by striking ‘‘and’’ at the end of 
paragraph (3), by striking the period at the end 
of paragraph (4) and inserting ‘‘, and’’, and by 
inserting after paragraph (4) adding at the end 
the following: 
‘‘(5) a merger that is designated as an alliance 
under subsection (e) shall not be treated as failing 
to meet any of the criteria of this subsection solely 
because benefits under the allied plan are, or are ex-
pected to be, reduced or eliminated pursuant to sec-
tion 305 as a result of the endangered or critical 
status of the frozen allied plan.’’. 
(C) Section 404(a) of the Employee Retire-
ment Income Security Act of 1974 is amended 
by adding at the end the following new para-
graph: 
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‘‘(3) With respect to a merger of multiemployer 
plans, including a merger that is designated as an 
alliance under section 4231(e), the plan sponsors of 
the merging plans shall be considered to meet the 
requirements of paragraph (1)(A) if the plan spon-
sors determine that the merger is not reasonably 
likely to be adverse to the long-term interests of the 
participants and beneficiaries of the plan for which 
the plan sponsors are responsible prior to the merg-
er.’’. 
(i) Section 4231(c) of the Employee 
Retirement Income Security Act of 1974 is 
amended by striking ‘‘The merger of multi-
employer plans or the transfer’’ and insert-
ing ‘‘The merger of multiemployer plans, 
including a merger that is designated as an 
alliance, or the transfer’’. 
(2) AMENDMENTS
TO
INTERNAL
REVENUE 
CODE OF 1986.—Section 412 of the Internal Revenue 
Code of 1986 is amended by adding at the end the 
following: 
‘‘(e) MULTIEMPLOYER PLAN ALLIANCES.— 
‘‘(1) IN GENERAL.—Except to the extent other-
wise provided in the plan amendment under section 
4231(e)(1) of the Employee Retirement Income Se-
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curity Act of 1974 designating a multiemployer plan 
merger as an alliance, this section and sections 431 
and 432 shall apply to the frozen allied plan and the 
plan into which the allied plan was merged as if they 
were separate plans. 
‘‘(2) EMPLOYERS
MAINTAINING
PLAN.—The 
employers that were obligated to contribute to the 
allied plan immediately before the effective date of 
the merger, and any successors thereto whether by 
sale, reorganization or otherwise, shall be considered 
to be the employers maintaining the partially sepa-
rate frozen allied plan to the extent they continue to 
have an obligation to contribute with respect to par-
ticipants or facilities covered by the allied plan. 
‘‘(3) PARTICIPANTS AND BENEFICIARIES.—The 
participants and beneficiaries of the allied plan im-
mediately before the effective date of the merger 
shall be considered to be the participants and bene-
ficiaries of the partially separate frozen allied plan 
thereafter. 
‘‘(4) TREATMENT OF MERGED PLAN AS SINGLE 
PLAN.—Except as provided in paragraphs (2) and 
(3) of section 4231(e) of the Employee Retirement 
Income Security Act of 1974, the allied plan and the 
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plan into which it has been merged shall be treated 
as a single plan. 
‘‘(5) ALLIANCE; ALLIED PLAN.—For purposes 
of this subsection, the terms ‘alliance’ and ‘allied 
plan’ shall have the same meanings as they have 
under section 4231(e) of the Employee Retirement 
Income Security Act of 1974.’’. 
(b) PBGC ASSISTANCE FOR MULTIEMPLOYER PLAN 
MERGERS.—Section 4231 of the Employee Retirement In-
come Security Act of 1974, as amended by this Act, is 
amended by adding at the end the following: 
‘‘(f) FACILITATED MERGERS.— 
‘‘(1) IN GENERAL.—When requested to do so 
by the plan sponsors, the corporation shall take rea-
sonable actions to promote and facilitate the merger 
of two or more multiemployer plans, including a 
merger that is designated as an alliance, if it deter-
mines that the transaction is in the interests of the 
participants and beneficiaries of at least one of the 
plans, and is not reasonably expected to be adverse 
to the long-term interests of the participants and 
beneficiaries of the other plan or plans. Such facili-
tation may include training, technical assistance, 
mediation, communication with stakeholders and 
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support with related requests to other government 
agencies, among other activities. 
‘‘(2) FINANCIAL
ASSISTANCE.—To facilitate 
mergers, including mergers designated as alliances, 
which it determines are reasonably necessary to en-
able one or more of the plans involved to avoid or 
postpone insolvency, the corporation may provide fi-
nancial assistance to the merged plan if it reason-
ably expects that such financial assistance will re-
duce the corporation’s likely long-term loss with re-
spect to the plans involved.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as of the first day of the first 
plan year beginning on or after January 1, 2009. 
SEC. 204. STRENGTHENING PARTICIPANTS’ BENEFIT PRO-
TECTIONS. 
(a) INCREASE IN MULTIEMPLOYER BENEFIT GUAR-
ANTEE.—Paragraph (1) of section 4022A(c) of the Em-
ployee Retirement Income Security Act of 1974 is amend-
ed to read as follows: 
‘‘(1) Except as provided in subsection (g), the 
monthly benefit of a participant or a beneficiary 
which is guaranteed under this section by the cor-
poration with respect to a plan is the product of the 
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number of the participant’s years of credited service 
multiplied by the sum of— 
‘‘(A) 100 percent of the accrual rate up to 
$11, plus 75 percent of the lesser of— 
‘‘(i) $33, or 
‘‘(ii) the accrual rate, if any, in excess 
of $11, and 
‘‘(B) 50 percent of the lesser of— 
‘‘(i) $40 or 
‘‘(ii) the accrual rate, if any, in excess of $44.’’. 
(b) QUALIFIED PARTITION OF ELIGIBLE MULTIEM-
PLOYER PLANS.— 
(1) QUALIFIED PARTITIONS.—Section 4233 of 
the Employee Retirement Income Security Act of 
1974 is amended by adding at the end the following 
new subsection: 
‘‘(g) QUALIFIED PARTITION OF ELIGIBLE MULTIEM-
PLOYER PLANS.— 
‘‘(1) 
IN
GENERAL.—Notwithstanding 
sub-
sections (a) through (f), upon the election by the 
plan sponsor of an eligible multiemployer plan of a 
qualified partition, the corporation shall order a par-
tition of the electing multiemployer plan in accord-
ance with this subsection, effective on the first day 
of the first month that begins at least 90 days after 
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the date the multiemployer plan made the qualified 
partition election. 
‘‘(2) ELIGIBLE MULTIEMPLOYER PLAN.—An el-
igible multiemployer plan is a multiemployer plan as 
to which— 
‘‘(A) the plan actuary has certified pursu-
ant to section 305(c) that the plan is currently 
in critical status (within the meaning of section 
305(b)(2)); 
‘‘(B) a substantial reduction in the amount 
of aggregate contributions under the plan has 
resulted or will result from— 
‘‘(i) cases or proceedings under title 
11, United States Code, with respect to 
employers, or 
‘‘(ii) employers’ ceasing to be in busi-
ness, if such employers did not pay the full 
amount of withdrawal liability demanded 
by the plan under section 4219; 
‘‘(C) the plan sponsor has certified, con-
sistent with projections provided by the plan ac-
tuary, that the plan is likely to become insol-
vent; 
‘‘(D) the plan sponsor has certified, con-
sistent with projections provided by the plan ac-
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tuary, that contributions will have to be in-
creased significantly to prevent insolvency; 
‘‘(E) the plan sponsor has certified that, as 
of the last day of each of the two immediately 
preceding plan years— 
‘‘(i) the ratio of the number of the 
plan’s retirees, beneficiaries of deceased 
participants, and terminated vested partici-
pants to the number of the plan’s active 
participants for each such year was at 
least 2 to 1; and 
‘‘(ii) the ratio of benefit payments 
made by the plan for each such year to 
contributions required to be made to the 
plan under section 304 or 305(e), as appli-
cable, for each such year was at least 2 to 
1; and 
‘‘(F) the plan sponsor has certified, con-
sistent with projections provided by the plan ac-
tuary, that partition would significantly reduce 
the likelihood that the plan will become insol-
vent. 
‘‘(3) TRANSFERS UNDER QUALIFIED PARTITION 
ORDER.—The corporation’s qualified partition order 
shall provide for transfers as follows: 
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100 
‘‘(A) An initial transfer of— 
‘‘(i) no more than the nonforfeitable 
benefits directly attributable to service with 
the employers referred to in paragraph 
(2)(ii), and 
‘‘(ii) assets attributable to any with-
drawal liability payments by such employ-
ers and, as adjusted by any gains or losses 
thereon, and reduced by any benefit pay-
ments made with regard to service with the 
employers. 
‘‘(B) As of the last day of each plan year 
following a plan year in which a qualified parti-
tion has occurred, the plan sponsor shall deter-
mine whether during such plan year, the aggre-
gate contributions under the plan declined by 
10 percent or more as a result of events de-
scribed in paragraph (2)(ii); and if such decline 
has occurred, an additional transfer of— 
‘‘(i) no more than the nonforfeitable 
benefits directly attributable to service with 
employers that meets the requirements of 
paragraph (2)(ii) after the election of a 
qualified partition, and 
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101 
‘‘(ii) assets attributable to any with-
drawal liability payments by such employ-
ers, as adjusted by any gains or losses 
thereon, and reduced by any benefit pay-
ments made with regard to service with the 
employers. 
‘‘(4) PLAN
CREATED
BY
QUALIFIED
PARTI-
TION.—The plan created by the qualified partition 
is— 
‘‘(A) a successor plan to which section 
4022A applies, and 
‘‘(B) a terminated multiemployer plan to 
which section 4041A(d) applies, with respect to 
which only the employers described in para-
graphs (2)(ii) and (3)(ii) have withdrawal liabil-
ity.’’. 
(2) EFFECT OF QUALIFIED PARTITION ON PRE-
MIUMS.— 
(A) Clause (i) of section 4006(a)(3)(C) of 
the Employee Retirement Income Security Act 
of 1974 is amended by adding at the end the 
following: 
‘‘For purposes of this subparagraph, the value of as-
sets held by the corporation and the basic benefits guaran-
teed for multiemployer plans shall not include assets and 
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103 
(c) FINANCING
FOR QUALIFIED PARTITIONS
AND 
OTHER SPECIAL MATTERS.— 
(1) OBLIGATIONS OF THE CORPORATION.—The 
second sentence of section 4002(g)(2) of the Em-
ployee Retirement Income Security Act of 1974 is 
amended to read as follows: 
‘‘The United States Government is not liable for any 
obligation or liability incurred by the corporation, except 
with respect to liabilities transferred pursuant to a quali-
fied partition of a multiemployer plan under section 
4233(g) and such other special matters as may be des-
ignated in legislation making funding available therefor.’’. 
(2) PBGC FUND ESTABLISHED.— 
(A) Fund Established. Section 4005 of the 
Employee Retirement Income Security Act of 
1974 is amended by deleting subsections (d) 
and (e), redesignating existing subsections (f) 
through (h) as subsections (e) through (g), and 
inserting a new subsection (d), as follows: 
‘‘(d) ESTABLISHMENT OF FIFTH FUND; PURPOSE; 
AVAILABILITY, ETC.— 
‘‘(1) IN GENERAL.—A fifth fund is hereby es-
tablished on the books of the Treasury of the United 
States. Such fund shall be for the support of special 
matters undertaken by the corporation to minimize 
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104 
its reasonably expected long-term risk of loss with 
respect to a plan and protect the reasonable benefit 
expectations of plan participants and beneficiaries 
pursuant to its responsibilities under section 4002(a) 
to encourage the continuation and maintenance of 
voluntary private pension plans for the benefit of 
their participants while maintaining premiums at the 
lowest level consistent with that objective. 
‘‘(2) USE OF FUND.—The fund established by 
this subsection shall be used to finance obligations 
undertaken by the corporation under section 4233 
(partition of multiemployer plans) and such other 
matters as may be identified from time to time in 
legislation making funding available therefor. 
‘‘(3) CREDITS TO FUND.—The fund established 
under this subsection shall be credited with funds 
made available to the corporation that are des-
ignated for special matters and the earnings thereon, 
including any amounts received in connection with a 
qualified partition under section 4233(g), and shall 
not include premiums paid under section 4007, em-
ployer liability or withdrawal liability payments, the 
assets of terminated plans or repayments of finan-
cial assistance under section 4261 or other amounts 
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105 
received in connection with terminated or insolvent 
plans. 
‘‘(4) TRANSACTIONS
WITH
OTHER
FUNDS.— 
Notwithstanding paragraph (3), this fund may en-
gage in transactions with the other funds established 
under this section to the extent reasonable and nec-
essary to meet liquidity demands and maximize the 
ability of the corporation to accomplish its mission 
under section 4002(a) without increasing the pre-
miums payable under section 4006. 
‘‘(5) INVESTMENTS.—The corporation may in-
vest amounts of the fund in such obligations as the 
corporation considers appropriate. 
‘‘(6) OBLIGATIONS OF UNITED STATES.—Not-
withstanding any other provision of this title, obliga-
tions of the corporation that are financed by the 
fund created by this subsection shall be obligations 
of the United States.’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Section 4022A(g) of such Act is 
amended by striking paragraph (2). 
(B) Part 1 of subtitle E of title IV of such 
Act is amended by striking section 4222, and 
the table of contents for such Act is amended 
by striking the item relating to section 4222. 
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106 
(d) EFFECTIVE DATE.— 
(1) The amendments made by subsection (a) 
shall apply with respect to plans that first apply for 
financial assistance from the Pension Benefit Guar-
antee Corporation after the date of enactment of 
this Act. 
(2) The amendments made by subsections (b) 
and (c) shall take effect on the date of enactment 
of this Act. 
Æ 
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