Pension Stability Act

Bill: 116-s-2598
Sponsor: full_name: Sen. Baldwin, Tammy [D-WI]
Introduced: 2019-10-15
Policy area: Labor and Employment
Subjects: Administrative law and regulatory procedures

Department of Labor

Employee benefits and pensions

Executive agency funding and structure

Financial services and investments

Pension Benefit Guaranty Corporation

User charges and fees
Latest action: action_date: 2019-10-15
text: Read twice and referred to the Committee on Health, Education, Labor, and Pensions. (Sponsor introductory remarks on measure: CR S5798)

Summaries:
action_date: 2019-10-15
action_desc: Introduced in Senate
text: <p><b>Pension Stability Act </b></p> <p>This bill requires the Department of Labor to establish user fees for qualified professional asset managers (QPAMs) who have been convicted of a crime and apply for an individual exemption (known as a QPAM waiver) to the prohibited transaction rules under requirements for certain private benefit plans. <p>The fees</p> <ul> <li> apply to large regulated banks, savings and loan associations, insurance companies, and federally registered investment advisors who are QPAMs; </li> <li> must be at least $1 million per application for an individual exemption; and </li> <li> increase based on the severity of the crime and the number of prior applications for individual exemptions. </li> </ul> <p>Labor must transfer the amounts collected from the user fees to the Pension Benefit Guaranty Corporation to assist in guaranteeing benefits under pension plans. </p>

tv_txt: II 116th CONGRESS 1st Session S. 2598 IN THE SENATE OF THE UNITED STATES October 15, 2019 Ms. Baldwin introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions A BILL To require the payment of user fees by qualified professional asset managers seeking an individual exemption from certain requirements.

1. Short title This Act may be cited as the Pension Stability Act . 2. User fees (a) In general Not later than 6 months after the date of enactment of this Act, the Secretary of Labor (referred to in this section as the Secretary ) shall promulgate regulations establishing user fees applicable to large regulated banks, savings and loan associations, insurance companies, and federally registered investment advisors (referred to in this section as entities ) that— (1) meet the definition of a qualified professional asset manager , as set forth by the Secretary; and (2) apply for an individual exemption, pursuant to the Prohibited Transaction Exemption 84–14, from the prohibitions of section 406 of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1106 ) and the sanctions resulting from the application of section 4975 of the Internal Revenue Code of 1986, despite the inability of such entities to comply with section I(g) of the Prohibited Transaction Exemption 84–14. (b) User fee amounts (1) General fees In establishing user fees under subsection (a), the Secretary shall ensure that such fees— (A) are not less than $1,000,000 per application for an individual exemption under section I(g) of the Prohibited Transaction Exemption 84–14; and (B) are scaled higher than the base fee established under subparagraph (A), based on the severity of the crime related to such application. (2) Repeat offenders In the case of an entity that previously filed an application for an individual exemption under section I(g) of the Prohibited Transaction Exemption 84–14 (including a successor company or a company that has subsequently acquired a previous offender), the applicable user fee under paragraph (1) shall be multiplied by the number of such prior applications. (c) Transfer of fees collected (1) In general Amounts collected in user fees under this section shall be transferred to the first and the second Pension Benefit Guaranty funds described in section 4005(a) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1305(a) ) and shall be allocated— (A) to the fund used with respect to basic benefits guaranteed under section 4022A of such Act ( 29 U.S.C. 1322a ), until such time that the Pension Benefits Guaranty Corporation's annual projections report indicates that such fund and the fund used with respect to basic benefits guaranteed under section 4022 of such Act ( 29 U.S.C. 1322 ) have substantially similar future financial conditions and substantially similar risks of insolvency; and (B) thereafter, to each of the funds described in subparagraph (A) in equal amounts, subject to paragraph (2). (2) Adjustments to allocations If, after amounts collected in user fees under this section have been allocated in accordance with paragraph (1)(B), the Director of the Pension Benefit Guaranty Corporation determines that the future financial conditions or risks of insolvency of the funds used with respect to basic benefits guaranteed under each of sections 4022A and 4022 of the Employee Retirement Income Security Act of 1974 are no longer substantially similar as described in paragraph (1)(A), the Director, in consultation with the board of directors of the Pension Benefit Guaranty Corporation, shall determine an appropriate allocation of such amounts between such funds.