Increasing the statutory limit on the public debt.
PL 101-140 (H.J.Res.280), enacted 11/08/1989

103 STAT. 830 
PUBLIC LAW 101-140—NOV. 8, 1989 
Public Law 101-140 
101st Congress 
Joint Resolution 
Nov. 8, 1989 
[H.J. Res. 280] 
Increasing the statutory limit on the public debt. 
Resolved by the Senate and House of Representatives of the United 
States of America in Congress assembled, That subsection (b) of 
section 3101 of title 31, United States Code, is amended by striking 
out the dollar limitation contained in such subsection, and inserting 
in lieu thereof "$3,122,700,000,000". 
TITLE II—REPEAL OF SECTION 89 
NONDISCRIMINATION RULES 
SEC. 201. AMENDMENT OF 1986 CODE. 
Whenever in this title an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986. 
SEC. 202. REPEAL OF SECTION 89. 
(a) IN GENERAL.—Section 89 (relating to benefits provided under 
certain discriminatory employee benefit plans) is hereby repealed. 
Ot)) CLERICAL AMENDMENT.—The table of sections for part II of 
subchapter B of chapter 1 is amended by striking the item relating 
to section 89. 
26 use 89 note. 
(c) EFFECTIVE DATE.—The amendments made by this section shall 
take effect as if included in section 1151 of the Tax Reform Act of 
1986. 
SEC. 203. REINSTATEMENT OF PRE.1986 ACT NONDISCRIMINATION RULES. 
(a) IN GENERAL.— 
26 use 6652, 79, 
(1) Each provision of law amended by subsection (b), (c), (d)(1), 
129' 12?' 1??' 
^^ ^^^ °^ section 1151 of the Tax Reform Act of 1986 is amended 
132 505 
^° ^^^^ ^^ ^^ ^^® amendments made by such subsection had not 
been enacted. 
(2) Each provision of law amended by paragraph (22), (27), or 
(31) of section lOllB(a) of the Technical and Miscellaneous 
26 use 3121, 
Revenue Act of 1988 is amended to read as if the amendments 
4976' 505^'i29^^' 
made by such paragraph had not been enacted. 
117, 'l20,127,' 
(3) Subparagraph (A) of section 125(g)(3) (as in effect on the 
132; 42 use 409. 
day before the date of the enactment of the Tax Reform Act of 
1986) is amended by striking "subparagraph (B) of section 
410(b)(1)" and inserting "section 410(b)(2)(A)(i)^'. 
(4) Section 162(1)(2) is amended by striking subparagraph (B) 
and redesignating subparagraph (C) as subparagraph (B). 
(5) Subparagraph (C) of section 401(a)(9) is amended— 
(A) by striking "(as defined in section 89(i)(4))", and 
(B) by adding at the end the following: "For purposes of 
this subparagraph, the term 'church plan' means a plan 
PUBLIC LAW 101-140—NOV. 8, 1989 
103 STAT. 831 
maintained by a church for church employees, and the term 
'church' 
means 
any 
church 
(as defined 
in 
section 
3121(w)(3)(A)) or qualified church-controlled organization 
(as defined in section 3121(w)(3)(B))." 
(6XA) Subparagraph (C) of section 414(n)(3) is amended by 
striking "89,". 
(B) Paragraph (1) of section 414(r) is amended by striking 
"sections 89 and" and inserting "section". 
(C) Paragraph (2) of section 414(t) is amended by striking 
"89,". 
(7) Sections 3021(c) and 6070 of the Technical and Miscellane- 
26 use 89 notes, 
ous Revenue Act of 1988 are hereby repealed, 
(b) EXCEPTIONS.— 
(1)(A) Paragraph (7) of section 79(d) (£is in effect on the day 
before the date of the enactment of the Tax Reform Act of 1986) 
is amended to read as follows: 
"(7) EXEMPTION FOR CHURCH PLANS.— 
"(A) IN GENERAL.—This subsection shall not apply to a 
church plan maintained for church employees. 
"(B) DEFINITIONS.—For purposes of subparagraph (A), the 
terms 'church plan' and 'church employee' have the mean-
ing given such terms by paragraphs (1) and (3XB) of section 
414(e), respectively, except that— 
"(i) section 414(e) shall be applied by substituting 
'section 501(c)(3)' for 'section 501' each place it appears, 
and 
"(ii) the term 'church employee' shall not include an 
employee o
f
— 
"(I) 
an 
organization 
described 
in 
section 
170(bXl)(A)(ii) above the secondary school level 
(other than a school for religious training), 
"(II) 
an 
organization 
described 
in 
section 
170(bXlXAXiii), and 
"(III) an 
organization 
described 
in 
section 
501(cX3), the basis of the exemption for which is 
substantially similar to the basis for exemption of 
an organization described in subclause (II)." 
(2) Paragraph (2) of section 125(d) (as in effect on the day 
before the date of the enactment of the Tax Reform Act of 1986) 
is amended to read £is follows: 
"(2) DEFERRED COMPENSATION PLANS EXCLUDED.— 
"(A) IN GENERAL.—The term 'cafeteria plan' does not 
include any plan which provides for deferred compensation. 
"(B) 
EXCEPTION 
70R 
CASH 
AND DEFERRED 
ARRANGE-
MENTS.—Subparagraph (A) shall not apply to a profit-shar-
ing or stock bonus plan or rural cooperative plan (within 
the meaning of section 401(kX7)) which includes a qualified 
cash or deferred arrangement (as defined in section 
401(kX2)) to the extent of amounts which a covered em-
ployee may elect to have the employer pay as contributions 
to a trust under such plan on behalf of the employee. 
"(C) EXCEPTION FOR CERTAIN PLANS MAINTAINED BY EDU-
CATIONAL INSTITUTIONS.—Subparagraph (A) shall not apply 
to a plan maintained by an educational organization de-
scribed in section 170(bXlXAXii) to the extent of amounts 
which a covered employee may elect to have the employer 
103 STAT. 832 
PUBLIC LAW 101-140—NOV. 8, 1989 
pay as contributions for post-retirement group life insur-
ance i
f
— 
"(i) all contributions for such insurance must be 
made before retirement, and 
"(ii) such life insurance does not have a cash surren-
der value at any time. 
For purposes of section 79, any life insurance described in 
the preceding sentence shall be treated as group-term life 
insurance." 
26 USG 79 note. 
(c) EFFECTIVE DATE.—The amendments made by this section shall 
take effect as if included in section 1151 of the Tax Reform Act of 
1986. 
SEC. 
2
0
4
. 
OTHER 
PROVISIONS 
RELATING 
TO 
NONTAXABLE 
BENEFITS. 
(a) DEPENDENT CARE ASSISTANCE.— 
(1) IN GENERAL.—Paragraph (1) of section 129(d) (as in effect 
on the day before the date of the enactment of the Tax Reform 
Act of 1986) is amended by adding at the end thereof the 
following new sentence: "If any plan would qualify as a depend-
ent care assistance program but for a failure to meet the 
requirements of this subsection, then, notwithstanding such 
failure, such plan shall be treated as a dependent care assist-
ance program in the case of employees who are not highly 
compensated employees." 
(2) EXCLUDED EMPLOYEES.— 
(A) Section 129(d) is amended by adding at the end 
thereof the following new paragraph: 
"(9) EXCLUDED EMPLOYEES.—For purposes of paragraphs (3) 
and (8), there shall be excluded from consideration— 
"(A) subject to rules similar to the rules of section 
410(b)(4), employees who have not attained the age of 21 
and completed 1 year of service (as defined in section 
410(a)(8)), and 
"(B) employees not included in a dependent care assist-
ance program who are included in a unit of employees 
covered by an agreement which the Secretary finds to be a 
collective bargaining gigreement between employee rep-
resentatives and 1 or more employees, if there is evidence 
that dependent care benefits were the subject of good faith 
bargaining between such employee representatives and 
such employer or employers." 
(B) Section 129(d)(3) (as in effect on the day before the 
date of the enactment of the Tax Reform Act of 1986) is 
amended by striking the last sentence. 
(3) DELAY IN APPLICATION OF BENEFITS TEST.— 
(A) Paragraph (7) of section 129(d) (as in effect after the 
amendment made by paragraph (14) of section lOllB(a) of 
the Technical and Miscellaneous Revenue Act of 1988) is 
redesignated as paragraph (8). 
(B) Paragraph (1) of section 129(d) (as in effect on the day 
before the date of the enactment of the Tax Reform Act of 
1986) is amended by striking "paragraphs (2) through (7)" 
and inserting "paragraphs (2) through (8)". 
(C) Section 129(e)(6) is amended by striking "(7)" and 
inserting "(8)". 
PUBLIC LAW 101-140—NOV. 8, 1989 
103 STAT. 833 
(D) Section 129(dX8) (as redesignated by subparagraph 
26 use 129 note. 
(A)) shall apply to plan years beginning after December 31, 
1989. 
(b) LINE OF BUSINESS TEST.— 
26 use 414 note. 
(1) APPLICATION OF LINE OF BUSINESS TEST FOR PERIOD BEFORE 
GUIDELINES ISSUED.—In the case of any plan year beginning on 
or before the date the Secretary of the Treasury or his delegate 
issues guidelines and begins issuing determinations under sec-
tion 414(r)(2)(C) of the Internal Revenue Code of 1986, an em-
ployer shall be treated as operating separate lines of business if 
the employer reasonably determines that it meets the require-
ments of section 414(r) (other than paragraph (2)(C) thereof) of 
such Code. 
(2) DEPENDENT CARE.—Paragraph (1) of section 414(r) is 
amended by striking "section 410(b)" and inserting "sections 
129(d)(8) and 410(b)". 
(c) GROUP-TERM LIFE INSURANCE.—Paragraph (7) of section 505(b) 
(relating to $200,000 compensation limit) is amended by adding at 
the end thereof the following new sentence: "This paragraph shall 
not applv in determining whether the requirements of section 79(d) 
are met.' 
(d) EFFECTIVE DATES,— 
(1) The amendments made by subsections (a)(1), (a)(2), and 26 USC129 note. 
(b)(2) shall apply to years beginning after December 31, 1988. 
(2) The amendments made by subsection (aX3) shall apply to 
26 USC 129 note, 
plan years beginning after December 31,1989. 
(3) The provisions of subsection (b)(1) shall apply to years 
26 USC 414 note. 
beginning after December 31,1986. 
(4) The amendment made by subsection (c) shall take effect as 
26 USC 505 note, 
if included in the amendment made by section 1011B(a)(32) of 
the Technical and Miscellaneous Revenue Act of 1988. 
TITLE III—RESTORATION OF TRUST 
FUNDS 
SEC. .301. RESTORATION OF TRUST FUNDS. 
31 USC 3101 
(a) IN GENERAL.— 
(1) OBLIGATIONS ISSUED.—Except as provided in subsection (b), 
within 30 days after the expiration of any debt issuance suspen-
sion period to which this section applies, the Secretary of the 
Treasury shall issue to each Federal fund obligations under 
chapter 31 of title 31, United States Code, which bear such issue 
dates, interest rates, and maturity dates as are necessary to 
ensure that, after such obligations are issued, the holdings of 
such Federal fund will replicate to the maximum extent prac-
ticable the obligations that would have been held by such 
Federal fund if any— 
(A) failure to invest amounts in such Federal fund (or any 
disinvestment) resulting from the limitation of section 
3101(b) of title 31, United States Code, had not occurred. 
103 STAT. 834 
PUBLIC LAW 101-140—NOV. 8, 1989 
(B) issuance of such obligations had occurred immediately 
on the expiration of the debt issuance suspension period. 
(2) INTEREST CREDITED.—On the first normal interest payment 
date or within 30 days after the expiration of any debt issuance 
suspension period (whichever is later) to which this section 
applies, the Secretary of the Treasury shall credit to each 
Federal fund an amount determined by the Secretary, after 
taking into account the actions taken pursuant to paragraph (1), 
to be equal to the income lost by such Federal fund by reason of 
any failure to invest amounts in such Federal fund (or any 
disinvestment) resulting from the limitation of such section 
3101(b), including any income lost between the expiration of the 
debt issuance suspension period and the date of the credit. 
(b) INTEREST ON MARKET-BASED OBLIGATIONS.—With respect to any 
Federal fund which invests in market-based special obligations, on 
the expiration of a debt issuance suspension period to which this 
section applies, the Secretary of the Treasury shall immediately 
credit to such fund an amount equal to the interest that would have 
been earned by such fund during the debt issuance suspension 
period if the daily balance in such fund that the Secretary was 
unable to invest by reason of the limitation of such section 3101(b) 
had been invested each day during such period, overnight, in obliga-
tions under chapter 31 of title 31, United States Code, earning 
interest at a rate determined by the Secretary in accordance with 
the standard practice of the Department of the Treasury. 
(c) CREDITED AMOUNTS TREATED AS INTEREST.—All amounts cred-
ited under this section shall be treated as interest on obligations 
issued under chapter 31 of title 31, United States Code, for all 
purposes of Federal law. 
(d) DEFINITIONS.—For purposes of this section— 
(1) DEBT ISSUANCE SUSPENSION PERIOD.—The term "debt issu-
ance suspension period" means the period beginning on or after 
October 31, 1989 and ending on the date of enactment of this 
Act. 
(2) FEDERAL FUND.—The term "Federal fund" means any 
Federal trust fund or Government account established pursuant 
to Federal law to which the Secretary of the Treasury has 
issued or is expressly authorized by law directly to issue obliga-
tions under chapter 31 of title 31, United States Code, in respect 
PUBLIC LAW 101-140—NOV. 8, 1989 
103 STAT. 835 
of public money, money otherwise required to be deposited in 
the Treasury, or amounts appropriated; except that such term 
shall not include the Civil Service Retirement and Disability 
Fund or the Thrift Savings Fund of the Federal Employees' 
Retirement System. 
Approved November 8, 1989. 
LEGISLATIVE HISTORY—H.J. Res. 280: 
CONGRESSIONAL RECORD, Vol. 135 (1989): 
May 17, considered and passed House pursuant to H. Con. Res. 106. 
Nov. 7, considered and passed Senate, amended. House concurred in Senate 
amendment.