I 
111TH CONGRESS 
1ST SESSION H. R. 3936 
To amend the Employee Retirement Income Security Act of 1974 and the 
Internal Revenue Code of 1986 to allow time for pensions to fund 
benefit obligations in light of economic circumstances in the financial 
markets of 2008, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 27, 2009 
Mr. POMEROY (for himself and Mr. TIBERI) introduced the following bill; 
which was referred to the Committee on Education and Labor, and in 
addition to the Committee on Ways and Means, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such 
provisions as fall within the jurisdiction of the committee concerned 
A BILL 
To amend the Employee Retirement Income Security Act 
of 1974 and the Internal Revenue Code of 1986 to 
allow time for pensions to fund benefit obligations in 
light of economic circumstances in the financial markets 
of 2008, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Preserve Benefits and Jobs Act of 2009’’. 
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(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title, etc. 
TITLE I—SINGLE EMPLOYER PLANS 
Sec. 101. Extended period for single-employer defined benefit plans to amortize 
certain shortfall amortization bases. 
Sec. 102. Expansion of corridor within which single-employer defined benefit 
plans are allowed to average asset values. 
Sec. 103. Lookback for benefit accrual restriction. 
Sec. 104. Lookback for credit balance rule. 
Sec. 105. Clarification of treatment of expenses. 
Sec. 106. Information reporting. 
Sec. 107. Benefit restriction effective date for collectively bargained plans. 
Sec. 108. Social Security level-income options. 
Sec. 109. PBGC guarantee. 
Sec. 110. Application of extended amortization period to plans subject to prior 
law funding rules. 
Sec. 111. Additions to funding-based limits on benefits and benefits accruals 
under single-employer plans. 
Sec. 112. Reportable events. 
TITLE II—MULTIEMPLOYER PLANS 
Sec. 201. Adjustments to funding standard account rules; reporting clarifica-
tion. 
Sec. 202. Multiemployer plans in endangered or critical status. 
Sec. 203. Multiemployer plan mergers and alliances. 
Sec. 204. Strengthening participants’ benefit protections. 
TITLE I—SINGLE EMPLOYER 
PLANS 
SEC. 101. EXTENDED PERIOD FOR SINGLE-EMPLOYER DE-
FINED BENEFIT PLANS TO AMORTIZE CER-
TAIN SHORTFALL AMORTIZATION BASES. 
(a) AMENDMENTS TO ERISA.— 
(1) IN
GENERAL.—Paragraph (2) of section 
303(c) of the Employee Retirement Income Security 
Act of 1974 is amended by adding at the end the 
following subparagraphs: 
‘‘(D) SPECIAL RULE.— 
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‘‘(i) IN GENERAL.—In the case of the 
shortfall amortization base of an active 
plan for any applicable plan year, the 
shortfall amortization installments are the 
amounts described in clause (ii) or clause 
(iii), as applicable, determined pursuant to 
clause (iv). 
‘‘(ii) 7-YEAR AMORTIZATION.— 
‘‘(I) IN GENERAL.—The shortfall 
amortization installments described in 
this clause are— 
‘‘(aa) in the case of the last 
7 plan years in the 9-plan-year 
period beginning with the appli-
cable plan year, the amounts nec-
essary to amortize the shortfall 
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-
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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) 
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 
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‘‘(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 
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 
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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 of the Treasury, but only if the 
shortfall amortization installments with re-
spect to the shortfall amortization base for 
such applicable plan year are determined 
under subparagraph (D)(ii). For purposes 
of this clause, any reference to the min-
imum required 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 without taking into account any waiv-
er under section 302(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 
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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 
year) under rules prescribed by the 
Secretary of the Treasury, 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 
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prescribed by the Secretary of the Treas-
ury, and may be revoked only with consent 
of the Secretary of the Treasury. 
‘‘(F) 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 
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.— 
‘‘(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 
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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 of the Treasury designed to prevent 
evasion of the purposes of this subpara-
graph. 
‘‘(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. 
‘‘(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— 
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‘‘(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-
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-
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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 the 
Internal Revenue Code of 1986) 
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 interest 
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— 
‘‘(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 
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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) of the Internal 
Revenue Code of 1986). A defined 
contribution plan shall not fail to sat-
isfy the requirements of this clause 
solely by reason of the failure to make 
allocations on behalf of one or more 
highly compensated employees (as de-
fined in section 414(q) of the Internal 
Revenue Code of 1986). 
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‘‘(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) 
of the Internal Revenue Code of 
1986). 
‘‘(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) of the Internal Revenue 
Code of 1986 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) of 
the Internal Revenue Code of 1986) 
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 of the 
Treasury shall provide rules under 
section 409A of the Internal Revenue 
Code of 1986 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 otherwise cause a fail-
ure 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) of the Internal Revenue 
Code of 1986), and 
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‘‘(bb) 
earn 
compensation 
that is not payable to the em-
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) of the In-
ternal Revenue Code of 1986, 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 of the 
Internal Revenue Code of 1986.’’. 
(2) CONFORMING AMENDMENT.—Paragraph (1) 
of section 303(c) of such Act is amended by striking 
‘‘the shortfall amortization bases for such plan year 
and each of the 6 preceding plan years’’ and insert-
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ing ‘‘any shortfall amortization base which has not 
been fully amortized under this subsection’’. 
(b) AMENDMENTS
TO
INTERNAL REVENUE 
CODE OF 1986.— 
(1) IN
GENERAL.—Paragraph (2) of section 
430(c) of the Internal Revenue Code of 1986 is 
amended by adding at the end the following sub-
paragraphs: 
‘‘(D) SPECIAL RULE.— 
‘‘(i) IN GENERAL.—In the case of the 
shortfall amortization base of an active 
plan for any applicable plan year, the 
shortfall amortization installments are the 
amounts described in clause (ii) or clause 
(iii), as applicable, determined pursuant to 
clause (iv). 
‘‘(ii) 7-YEAR AMORTIZATION.— 
‘‘(I) IN GENERAL.—The shortfall 
amortization installments described in 
this clause are— 
‘‘(aa) in the case of the last 
7 plan years in the 9-plan-year 
period beginning with the appli-
cable plan year, the amounts nec-
essary to amortize the shortfall 
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102 
liabilities transferred pursuant to a qualified partition 
order under section 4233(g).’’. 
(B) Section 4022A(f) of the Employee Re-
tirement Income Security Act of 1974 is 
amended by adding at the end the following: 
‘‘(5) Basic benefits guaranteed in connection 
with assets and liabilities transferred to the corpora-
tion pursuant to a qualified partition order under 
section 4233(g) shall be disregarded under subpara-
graphs (1), (2), and (3)’’. 
(3) PBGC GUARANTEE OF PARTITIONED BENE-
FITS.— 
(A) Section 4022A of the Employee Retire-
ment Income Security Act of 1974 is amended 
by adding at the end the following: 
‘‘(i) The monthly benefit of a participant or a bene-
ficiary whose benefit was transferred pursuant to a quali-
fied partition which is guaranteed under this section by 
the corporation with respect to a plan is the nonforfeitable 
benefits of the participant or beneficiary transferred pur-
suant to the qualified partition.’’. 
(B) Section 4022A(c)(1) of the Employee 
Retirement Income Security Act of 1974 is 
amended by striking ‘‘subsection (g)’’ and in-
serting ‘‘subsections (g) and (i)’’. 
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