[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 1979 Introduced in Senate (IS)]
113th CONGRESS
2d Session
S. 1979
To provide for USA Retirement Funds, to reform the pension system, and
for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 30, 2014
Mr. Harkin (for himself and Mr. Brown) introduced the following bill;
which was read twice and referred to the Committee on Health,
Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To provide for USA Retirement Funds, to reform the pension system, and
for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``USA Retirement
Funds Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--USA RETIREMENT FUNDS
Sec. 101. Automatic USA Retirement Fund arrangements.
Sec. 102. Establishment of USA Retirement Funds.
Sec. 103. Commission on USA Retirement Funds.
Sec. 104. Limitation on employer liability.
Sec. 105. Enforcement and fraud prevention.
TITLE II--DEFINED CONTRIBUTION PLAN REFORMS
Subtitle A--Savings Enhancements
Sec. 201. Pooled employer plans.
Sec. 202. Pooled employer and multiple employer plan reporting.
Subtitle B--Participant Protections
Sec. 211. Alternative fiduciary arrangements to protect plan
participants.
Sec. 212. Rollover protections.
Subtitle C--Lifetime Income
Sec. 221. Lifetime income disclosure.
Sec. 222. Lifetime income safe harbor.
Sec. 223. Default investment safe harbor clarification.
Sec. 224. Administration of joint and survivor annuity requirements.
TITLE III--DEFINED BENEFIT SYSTEM REFORMS
Subtitle A--Defined Benefit Pension Plan Reforms
Sec. 301. Hybrid plans.
Sec. 302. Clarification of the normal retirement age.
Sec. 303. Moratorium on imposition of shutdown liability.
Sec. 304. Alternative funding target attainment percentage determined
without regard to reduction for credit
balances.
Sec. 305. Method for determining changes for quarterly contributions.
Sec. 306. Election to discount contributions from final due date.
Sec. 307. Simplification of elections and notices.
Sec. 308. Improved multiemployer plan disclosure.
Subtitle B--Improvements to the Pension Insurance Program
Sec. 311. Modifications of technical changes made by the Pension
Protection Act of 2006 to termination
liability.
Sec. 312. Payment of lump sum distributions in bankruptcy.
Sec. 313. Trusteeship clarifications.
Sec. 314. Recordkeeping for terminating plans.
Sec. 315. Termination date in bankruptcy.
TITLE IV--OTHER SYSTEMIC REFORMS
Sec. 401. Plan audit quality improvement.
Sec. 402. Special rules relating to treatment of qualified domestic
relations orders.
Sec. 403. Correction to bonding requirement.
Sec. 404. Retaliation protections.
TITLE I--USA RETIREMENT FUNDS
SEC. 101. AUTOMATIC USA RETIREMENT FUND ARRANGEMENTS.
(a) Requirement To Provide Access.--Each covered employer shall
make available to each qualifying employee for the calendar year an
automatic USA Retirement Fund arrangement.
(b) Covered Employer.--For purposes of this title--
(1) In general.--Except as otherwise provided in this
subsection and subsection (c)(2), the term ``covered employer''
means, with respect to any calendar year, an employer who does
not maintain a qualifying plan or arrangement for any part of
such year.
(2) Qualifying plan or arrangement.--
(A) In general.--The term ``qualifying plan or
arrangement'' means a plan or arrangement described in
section 219(g)(5) of the Internal Revenue Code of 1986.
(B) Exceptions.--Such term shall not include the
following:
(i) Frozen defined benefit plan.--A defined
benefit plan that had no ongoing accruals as of
the first day of the preceding calendar year,
unless the plan failed to have accruals only
because of the application of section 206 of
the Employee Retirement Income Security Act (29
U.S.C. 1056) and section 436 of the Internal
Revenue Code of 1986.
(ii) Defined contribution plan without
lifetime income options.--A defined
contribution plan that does not provide
participants with a distribution option that
provides lifetime income.
(iii) Plans not meeting contribution
requirements.--A plan--
(I) which consists of a cash or
deferred arrangement (as defined in
section 401(k) of such Code) with
respect to which the employer does not
automatically enroll all eligible
employees at contribution rates at or
above those specified in subsection
(d)(4); or
(II) for which the only
contributions are nonelective employer
contributions and with respect to which
the employer's annual contribution rate
is not at or above the rates specified
in subsection (d)(4).
(3) Exception for certain small and new employers.--
(A) In general.--The term ``covered employer''
shall not include an employer for a calendar year if
the employer--
(i) did not employ during the preceding
calendar year more than 10 employees who each
received at least $5,000 of compensation (as
defined in section 3401(a) of the Internal
Revenue Code of 1986) from the employer for
such preceding calendar year;
(ii) did not normally employ more than 10
employees on a typical business day during the
preceding calendar year; or
(iii) was not in existence at all times
during the calendar year and the preceding
calendar year.
(B) Operating rules.--In determining the number of
employees for purposes of subparagraph (A)--
(i) rules consistent with any rules
applicable in determining the number of
employees for purposes of section 408(p)(2)(C)
and section 4980B(d) of the Internal Revenue
Code of 1986 shall apply;
(ii) all members of the same family (within
the meaning of section 318(a)(1) of the
Internal Revenue Code of 1986) shall be treated
as 1 individual; and
(iii) any reference to an employer shall
include a reference to any predecessor
employer.
(4) Exception for governments and churches.--The term
``covered employer'' shall not include--
(A) a government or entity described in section
414(d) of the Internal Revenue Code of 1986; or
(B) a church or a convention or association of
churches that is exempt from tax under section 501 of
such Code.
(5) Aggregation rule.--A person treated as a single
employer under subsection (a) or (b) of section 52 of the
Internal Revenue Code of 1986 or subsection (m) or (o) of
section 414 of such Code shall be treated as a single employer.
(c) Qualifying Employee.--For purposes of this title--
(1) In general.--The term ``qualifying employee'' means any
employee who is not an excluded employee.
(2) Plan sponsor's employees.--If--
(A) an employer maintains one or more qualifying
plans or arrangements described in section 219(g)(5) of
the Internal Revenue Code of 1986; and
(B) the employees of a subsidiary, division, or
other business unit are generally not eligible to
participate in any such qualifying plan or arrangement,
for purposes of this section, the employer shall be treated as
a covered employer with respect to such employees (other than
excluded employees), and such employees (other than excluded
employees) shall be treated as qualifying employees for the
calendar year.
(3) Excluded employees.--
(A) In general.--The term ``excluded employee''
means an employee who is an excludable employee and who
is in a class or category that the employer excludes
from treatment as qualifying employees.
(B) Excludable employee.--The term ``excludable
employee'' means--
(i) an employee described in section
410(b)(3) of the Internal Revenue Code of 1986;
(ii) an employee who has not attained the
age of 21 before the beginning of the calendar
year;
(iii) an employee who has not completed at
least 3 months of service with the employer;
(iv) in the case of an employer that
maintains a qualifying plan or arrangement
which excludes employees who have not satisfied
the minimum age and service requirements for
participation in the plan, an employee who has
not satisfied such requirements;
(v) in the case of an employer that
maintains an annuity contract (including a
custodial account or retirement income account)
under section 403(b) of the Internal Revenue
Code of 1986, an employee who is permitted to
be excluded from any salary reduction
arrangement under the contract pursuant to
paragraph (12) of such section 403(b);
(vi) in the case of an employer that
maintains an arrangement described in section
408(p) of such Code, an employee who is not
required to be eligible to participate in the
arrangement under paragraph (4) of such section
408(p); and
(vii) in the case of an employer that
maintains a simplified employee pension
described in section 408(k) of such Code, an
employee who is permitted to be excluded from
participation under paragraph (2) of such
section 408(k).
(4) Guidance.--The Secretary of Labor (in this title
referred to as the ``Secretary'') shall issue regulations or
other guidance to carry out this subsection, including--
(A) guidelines for determining the classes or
categories of employees to be covered by a USA
Retirement Fund;
(B) guidelines requiring employers to specify the
classification or categories of employees (if any) who
are excluded from the USA Retirement Fund; and
(C) rules to prevent avoidance of the requirements
of this section.
(d) Automatic USA Retirement Fund Arrangement.--For purposes of
this title--
(1) In general.--The term ``automatic USA Retirement Fund
arrangement'' means an arrangement of an employer (determined
without regard to whether the employer is required to maintain
the arrangement)--
(A) that covers each qualifying employee of the
covered employer for the calendar year;
(B) under which a qualifying employee--
(i) may elect--
(I) to contribute to an automatic
USA Retirement Fund by having the
employer deposit payroll deduction
amounts or make other periodic direct
deposits (including electronic
payments) to the Fund; or
(II) to have such payments paid to
the employee directly in cash;
(ii) is treated as having made the election
under clause (i)(I) in the amount specified in
paragraph (4) unless the individual
specifically elects not to have such
contributions made (or specifically elects to
have such contributions made at a different
percentage or in a different amount); and
(iii) not more than once per calendar year,
may elect to modify the selection of the USA
Retirement Fund to which contributions are made
for such year; and
(C) that meets the administrative requirements of
paragraph (3), including the notice requirement of
paragraph (3)(C).
(2) Automatic re-enrollment.--An employee's election not to
contribute to a USA Retirement Fund (or to have such
contributions made at a different percentage or in a different
amount from those specified in paragraph (4)) shall expire
after 2 years. After such 2-year period and absent a new
election, the employee shall be treated as having made the
election under paragraph (1)(B)(i)(I) in the amount specified
in paragraph (4).
(3) Administrative requirements.--
(A) Payments.--An employer shall make the payments
elected or treated as elected under paragraph (1)(B) on
or before--
(i) the last day of the month following the
month in which the compensation otherwise would
have been payable to the employee in cash; or
(ii) such later date as the Secretary may
prescribe.
(B) Termination of employee participation.--Subject
to a requirement for reasonable notice, an employee may
elect to terminate participation in the arrangement at
any time during a calendar year. The arrangement may
provide that, if an employee so terminates
participation, the employee may not elect to resume
participation until the beginning of the next calendar
year.
(C) Notice of election period.--The employer shall
notify each employee eligible to participate for a year
in a USA Retirement Fund arrangement, within a
reasonable period of time before the 30th day before
the beginning of such year (and, for the first year the
employee is so eligible, the 30th day before the first
day such employee is so eligible), of--
(i) the payments that may be elected or
treated as elected under paragraph (1)(B);
(ii) the opportunity to make the election
to terminate participation in the arrangement
under subparagraph (B);
(iii) the opportunity to make the election
under paragraph (1)(B)(ii) to have
contributions or purchases made at a different
percentage or in a different amount; and
(iv) the opportunity under paragraph
(1)(B)(iii) to modify the manner in which such
amounts are invested for such year.
(D) Employees may choose usa retirement fund.--The
arrangement shall provide that a qualified employee may
elect to have contributions made to any USA Retirement
Fund available to the employee.
(4) Amount of contributions and payments.--The amount
specified in this paragraph is--
(A) 3 percent of compensation for the calendar year
beginning on January 1, 2015;
(B) 4 percent of compensation for the calendar year
beginning on January 1, 2016;
(C) 5 percent of compensation for the calendar year
beginning on January 1, 2017; and
(D) 6 percent of compensation for calendar years
beginning after December 31, 2017.
(5) Coordination with withholding.--The Secretary of the
Treasury shall modify the withholding exemption certificate
under section 3402(f) of the Internal Revenue Code of 1986 so
that, in the case of any qualifying employee covered by a USA
Retirement Fund arrangement, any notice and election
requirements with respect to the arrangement may be met through
the use of an attachment to such certificate or other
modifications of the withholding exemption procedures.
(e) Deposits to USA Retirement Funds.--
(1) In general.--Except as provided in paragraph (2), an
employer shall make all contributions on behalf of employees to
the USA Retirement Fund specified by the employee.
(2) USA retirement funds other than those selected by
employee.--In the absence of an affirmative selection of a USA
Retirement Fund by the employee, contributions on behalf of the
employee shall be made to the USA Retirement Fund designated by
the employer.
(3) Regulations.--The Secretary may issue such regulations
as are necessary to carry out this subsection.
(f) Preemption of Conflicting State Laws.--The requirements under
this section preempt any law of a State that directly or indirectly
prohibits or restricts the establishment or operation of an automatic
USA Retirement Fund arrangement. Nothing in this section shall be
construed to impair or preempt any State law to the extent such State
law provides a remedy for the failure to make payroll deposit payments
under any such automatic USA Retirement Fund arrangement within the
period required.
SEC. 102. ESTABLISHMENT OF USA RETIREMENT FUNDS.
(a) Qualification as a USA Retirement Fund.--For purposes of this
title--
(1) In general.--The term ``USA Retirement Fund'' means a
fund for which the Secretary has determined the requirements
under this title are met.
(2) Request for determination.--The board of trustees of a
program established for purposes of being treated as a USA
Retirement Fund under this section shall, prior to beginning
operations, submit to the Secretary (at such time and in such
manner as the Secretary may prescribe) a request for the
Secretary to make a determination as to whether the plan meets
the requirements of this title for such treatment. Such request
shall include copies of the written documents establishing the
plan and such other materials as the Secretary may request. The
Secretary shall make such determination within 180 days of
receiving such request.
(3) Periodic review.--The Secretary shall establish a
process to periodically review each plan determined to be a USA
Retirement Fund under paragraph (1) to ensure that the plan
continues to meet the requirements of this title.
(4) Public list of plans.--The Secretary shall maintain a
public list of plans determined by the Secretary to qualify as
USA Retirement Funds. Such list shall be posted to a publicly
available Internet website.
(b) Participation.--
(1) Eligibility.--An individual may participate in any USA
Retirement Fund for which such individual meets the eligibility
requirements, individually or through an arrangement
established by an employer.
(2) Participation in other plans.--An individual who
participates in a USA Retirement Fund shall not be precluded
from participating in a plan or arrangement described in
section 219(g)(5) of the Internal Revenue Code of 1986.
(c) Governance.--
(1) Assets held in trust; board of trustees.--For purposes
of this title--
(A) the assets of each USA Retirement Fund shall be
held in trust, and
(B) the Fund shall be governed by a board of
trustees which shall consist of at least 3 individuals
who--
(i) are independent of service providers to
the Fund;
(ii) meet the qualification requirements
established under this section; and
(iii) are collectively able to adequately
represent the interests of active participants,
retirees, and contributing employers.
(2) Independence requirement.--An individual is not
independent of Fund service providers for purposes of paragraph
(1)(B)(i) if such individual--
(A) is an employee of any Fund service provider;
(B) is a current or former officer or director of a
significant Fund service provider, or is otherwise
affiliated with such a provider;
(C) is a member of the immediate family of any
person who is affiliated with a significant Fund
service provider;
(D) derives more than 1 percent of the individual's
annual income from a significant Fund service provider;
(E) derives more than 5 percent of the individual's
annual income from any Fund service provider; or
(F) fails to meet meets such other criteria as are
specified by the Secretary to ensure the independence
of the board of directors.
(3) Multiple trusteeships.--No individual may serve on the
board of trustees of more than 1 USA Retirement Fund unless the
Secretary receives attestation from the board of trustees of
each applicable USA Retirement Fund and the individual that, at
the time of appointment, there is no reasonably foreseeable
conflict between the duties of such individual to the
participants in each applicable USA Retirement Fund. In no case
may an individual serve on the boards of trustees of more than
3 USA Retirement Funds.
(4) Trustee qualifications.--Each trustee of a USA
Retirement Fund shall attest that the trustee is knowledgeable
of the trustee's duties and responsibilities as a fiduciary of
a USA Retirement Fund. The Secretary may require by regulation
such other qualifications and documentation as may be necessary
to ensure that trustees are suitable and qualified. Such
requirements may include those related to education, training,
and minimum competency standards.
(5) Trustee selection and removal.--
(A) In general.--Each board of trustees of a USA
Retirement Fund shall establish written procedures
regarding the appointment, removal, and replacement of
trustees on the board. Such procedures shall--
(i) take effect after adoption by the
majority of the board of trustees;
(ii) be readily available to participants;
(iii) provide participants with a
reasonable opportunity to comment on, or
participate in, the trustee selection process;
and
(iv) provide for periodic election of
trustees.
(B) Removal by the secretary.--The Secretary may
require removal or suspension of a trustee if the
conduct of the trustee is fraudulent or is causing, or
can be reasonably expected to cause, significant,
imminent, and irreparable harm to the participants or
beneficiaries of a USA Retirement Fund.
(C) Funds without qualified trustees.--If a board
of trustees of a USA Retirement Fund has no members
meeting the criteria under this subsection, the
Secretary shall appoint replacement trustees.
(6) Trustee compensation.--Trustees of the Fund may be
compensated at reasonable rates from the Fund, but only if such
compensation is paid in accordance with the written board
compensation policy adopted under paragraph (7)(A)(iv).
(7) Transparency and participant democracy.--
(A) Publicly available policies.--The board of
trustees of a USA Retirement Fund shall adopt and make
available to participants and beneficiaries of, and
employers contributing to, the USA Retirement Fund--
(i) a written investment policy statement;
(ii) a written lifetime income policy
statement;
(iii) an annual performance assessment of
the board of trustees, including an evaluation
of weaknesses of the board and a plan to
address such weaknesses;
(iv) a written board compensation policy
that includes current compensation levels and
provides a reasonable opportunity for comment
from participants, beneficiaries, and
employers; and
(v) a written policy addressing conflicts
of interests with respect to trustees.
(B) Participant input regarding board of
trustees.--
(i) In general.--The board of trustees of a
USA Retirement Fund shall establish procedures
whereby a participant or beneficiary of such
USA Retirement Fund may--
(I) petition the board of trustees
to remove a trustee or service
provider;
(II) comment on the management and
administration of the USA Retirement
Fund; and
(III) with respect to a USA
Retirement Fund with more than
$250,000,000 of assets, vote to approve
or disapprove the compensation of the
trustees at least once every 3 years.
(ii) Effect of vote.--If participants and
beneficiaries of a USA Retirement Fund vote to
disapprove the compensation of trustees under
clause (i)(III)--
(I) the results of such vote shall
not be binding on the board of
trustees; and
(II) the board of trustees shall
notify the Secretary of the results of
such vote and provide an explanation of
why the compensation is reasonable or
anticipated changes to the
compensation.
(8) Liability insurance for trustees.--The trustees of each
USA Retirement Fund shall have fiduciary liability insurance
with a per-claim limit equal to no less than the greater of--
(A) 5 percent of plan assets; or
(B) $1,000,000.
(9) Trustee duties.--
(A) In general.--The trustees of a USA Retirement
Fund shall manage the Fund with the intention of
providing each participant with a cost-effective stream
of income in retirement and reducing benefit level
volatility (particularly for those approaching
retirement).
(B) Applicability of other requirements.--Each
trustee of a USA Retirement Fund shall be a fiduciary
subject to sections 404(a), 404(b), 405, 406, and 408
through 413 of the Employee Retirement Income Security
Act of 1974 with respect to the Fund and participants
and beneficiaries of the Fund. Each such trustee shall
be subject to the standards and remedies of such
sections and section 502 of such Act, as if the Fund
were an employee benefit plan.
(d) Employer Contribution Limitation.--
(1) In general.--Subject to paragraph (2), employers may,
in addition to contributions an employee elects (or is treated
as having elected) to have made, make a contribution of up to
$5,000 per year to a USA Retirement Fund on behalf of each
employee eligible to participate in a USA Retirement Fund,
provided such contributions are made in a uniform manner (as
the same dollar amount for each such employee or the same
percentage of pay for each such employee) and are not intended
to benefit solely highly compensated employees.
(2) Annual indexing of amount.--The dollar amount under
paragraph (1) shall be indexed annually for inflation.
(e) Benefits in the Form of an Annuity.--
(1) In general.--A USA Retirement Fund shall pay benefits
in the form of an annuity in accordance with paragraph (2). The
amount of such benefits shall be dependent on the amount of
contributions made by the participant, the experience of the
Fund, and the form of distribution elected by the participant.
The amount of an annuity may be adjusted to reflect the
experience of the Fund as necessary to protect the financial
integrity of the Fund, except that annuity payments for those
in pay status shall not be reduced more than 5 percent per year
unless the Fund is faced with a significant financial hardship
and the Secretary has approved the reduction.
(2) Annuity.--A USA Retirement Fund shall pay benefits in
accordance with one of the following:
(A) In the case of a participant who does not die
before the annuity starting date, the benefit payable
to such participant shall be provided in the form of a
qualified joint and survivor annuity (as defined in
section 205(d)(1) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1055(d)(1))).
(B) In the case of a participant who dies before
the annuity starting date and who has a surviving
spouse, a qualified preretirement survivor annuity (as
defined in section 205(d)(2) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1055(d)(2)))
shall be provided to the surviving spouse of such
participant.
(C) In lieu of a qualified joint and survivor
annuity form of benefit or the qualified preretirement
survivor annuity form of benefit (or both), a
participant may elect to receive a distribution
described in subsection (f)(2) if one of the following
conditions are met:
(i)(I) The spouse of the participant
consents in writing to the election.
(II) Such election designates a beneficiary
(or form of benefits) which may not be changed
without spousal consent (or the consent of the
spouse expressly permits designations by the
participant without any requirement of further
consent by the spouse).
(III) The spouse's consent acknowledges the
effect of such election and is witnessed by a
plan representative or a notary public.
(ii) It is established to the satisfaction
of a Fund representative that the consent
required under subclause (I) cannot be obtained
because there is no spouse, because the spouse
cannot be located, or because of such other
circumstances as the Secretary may by
regulations prescribe.
The consent of a spouse (or establishment that the
consent of a spouse cannot be obtained) under this
subparagraph shall be effective only with respect to
such spouse.
(3) Commencement of benefit payments.--A participant may
elect the time to start receiving benefit payments from the USA
Retirement Fund, except that a participant--
(A) except as provided in subsection (f)(2)(B), may
not elect to receive benefit payments before reaching
the age of 60; and
(B) must begin receiving benefit payments before
the age of 72.
(4) Notice.--Each Fund shall provide to each participant,
within a reasonable period of time before the annuity starting
date, a written explanation substantially similar to that
required by section 205(c)(3) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1055(c)(3)).
(5) Assignment or alienation of fund benefits.--Benefits
under a USA Retirement Fund shall be subject to section 206(d)
of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1056(d)).
(f) Limits on Withdrawals and Transfers.--
(1) Transfers.--A participant may, not more frequently than
once per year, transfer such participant's benefit to another
USA Retirement Fund.
(2) Limits on distributions.--
(A) In general.--Except as provided in
subparagraphs (B) and (C), a participant may not take a
distribution other than one described in subsection
(e)(2).
(B) Participants aged 59 and younger.--A
participant may before age 60 take a distribution of a
portion of the participant's benefit if such
distribution does not to exceed $5,500 and is rolled
over to a qualifying plan or arrangement described in
section 219(g)(5) of the Internal Revenue Code of 1986
or an individual retirement plan.
(C) Participants aged 60 and older.--A participant
who is 60 or older but who has not entered pay status
may elect one time to take a distribution of the
greater of $10,000 or 50 percent of the participant's
benefit if the participant demonstrates to the
satisfaction of the trustees of the Fund that the
participant has sufficient retirement income apart from
the Fund or is facing a substantial hardship.
(g) Methods for Providing Annuitized Benefit Payments.--
(1) In general.--A USA Retirement Fund shall establish and
maintain mechanisms for adequately securing the payment of
annuity benefits from the Fund. The Fund shall include a
written description of such mechanisms in the investment and
lifetime income policy statements required to be disclosed to
participants.
(2) Specific goals.--The mechanisms described in paragraph
(1) shall ensure that--
(A) each participant receives a stream of income
for life;
(B) each participant and beneficiary has an
opportunity to be protected against longevity risk; and
(C) volatility in benefit levels is minimized for
participants and beneficiaries in pay status and those
approaching pay status.
(3) Self-annuitization.--
(A) In general.--Notwithstanding any other
provision of law, a USA retirement Fund may self-
annuitize if the Fund meets such requirements as the
Secretary establishes as necessary to protect
participants and beneficiaries in consideration of the
recommendations of the Commission under section 103.
(B) Duty to address emerging issues.--The Secretary
shall, periodically and in accordance with established
procedures, update the funding requirements promulgated
under this paragraph in response to changing economic
and business conditions to the extent necessary to
carry out the purposes of this Act, taking into
consideration the recommendations of the Commission.
(h) Reporting and Disclosure.--
(1) Annual statement.--The trustees of a USA Retirement
Fund shall provide each participant in the Fund an annual
statement of--
(A) the estimated amount of the monthly benefit
which the participant or beneficiary is projected to
receive from the USA Retirement Fund, in the form of
the default benefit described in the plan in accordance
with subsection (e)(2);
(B) an explanation, written in a manner calculated
to be understood by the average plan participant, that
includes interest and mortality assumptions used in
calculating the estimate and a statement that actual
benefits may be materially different from such
estimate;
(C) a disclosure of Fund fees and performance that
is substantially similar to the disclosures required of
individual account plans under the Employee Retirement
Income Security Act of 1974;
(D) any other disclosures, including projected
benefit estimates, that the board of trustees of the
USA Retirement Fund determines appropriate; and
(E) such other disclosures as may be required by
the Secretary.
(2) Summary plan description.--The trustees of a USA
Retirement Fund shall provide participants a summary plan
description (as described in section 102 of the Employee
Retirement Income Security Act (29 U.S.C. 1022)) as required by
section 104(b) of the Employee Retirement Income Security Act
(29 U.S.C. 1024(b)).
(3) Annual reports.--The trustees of a USA Retirement Fund
shall file with the Secretary of Labor periodic reports in
accordance with regulations promulgated by the Secretary.
(4) Additional requirements.--Each USA Retirement Fund
shall be subject to sections 106 and 107 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1026, 1027).
SEC. 103. COMMISSION ON USA RETIREMENT FUNDS.
(a) Recognition of Private Commission.--The Secretary shall--
(1) recognize an independent, private commission, to be
known as the ``Commission for USA Retirement Funds Funding''
(referred to in this title as the ``Commission''), and
(2) in carrying out the Secretary's duties under this
title, consider the recommendations of such Commission.
(b) Commission.--The Commission recognized under subsection (a)
shall meet the following requirements:
(1) Membership.--
(A) Composition.--The Commission shall be composed
of 9 members selected by the Secretary, in consultation
with the Secretary of the Treasury, of whom no more
than 5 may be from one political party. The Secretary
shall designate one member of the Commission as the
Chairman. No person may be appointed to the Commission
if, during the 2-year period preceding the date of
appointment, such person was a trustee of a USA
Retirement Fund.
(B) Date.--The appointments of the members of the
Commission shall be made not later than 90 days after
the date of enactment of this Act.
(C) Period of appointment; vacancies.--Members
shall be appointed for terms of 2 years and may be
appointed for consecutive terms. Any vacancy in the
Commission shall not affect its powers, and shall be
filled in the same manner as the original appointment.
(2) Majority vote.--The Commission may act by majority vote
of its members, provided that at least 7 members are present.
(3) Commission personnel matters.--
(A) Compensation of members.--Each member of the
Commission who is not an officer or employee of the
Federal Government shall be compensated at a rate equal
to the daily equivalent of the annual rate of basic pay
prescribed for level IV of the Executive Schedule under
section 5315 of title 5, United States Code, for each
day (including travel time) during which such member is
engaged in the performance of the duties of the
Commission. All members of the Commission who are
officers or employees of the United States shall serve
without compensation in addition to that received for
their services as officers or employees of the United
States.
(B) Travel expenses.--The members of the Commission
shall be allowed travel expenses, including per diem in
lieu of subsistence, at rates authorized for employees
of agencies under subchapter I of chapter 57 of title
5, United States Code, while away from their homes or
regular places of business in the performance of
services for the Commission.
(C) Staff.--
(i) In general.--The Chairman of the
Commission may, without regard to the civil
service laws and regulations, appoint and
terminate an executive director and such other
additional personnel as may be necessary to
enable the Commission to perform its duties.
The employment of an executive director shall
be subject to confirmation by the Commission.
(ii) Compensation.--The Chairman of the
Commission may fix the compensation of the
executive director and other personnel without
regard to chapter 51 and subchapter III of
chapter 53 of title 5, United States Code,
relating to classification of positions and
General Schedule pay rates, except that the
rate of pay for the executive director and
other personnel may not exceed the rate payable
for level V of the Executive Schedule under
section 5316 of such title.
(iii) Detail of government employees.--Any
Federal Government employee may be detailed to
the Commission without reimbursement, and such
detail shall be without interruption or loss of
civil service status or privilege.
(iv) Procurement of temporary and
intermittent services.--The Chairman of the
Commission may procure temporary and
intermittent services under section 3109(b) of
title 5, United States Code, at rates for
individuals which do not exceed the daily
equivalent of the annual rate of basic pay
prescribed for level V of the Executive
Schedule under section 5316 of such title.
(4) Recommendations and regulations on funding and
distribution requirements.--
(A) In general.--After taking into consideration
the recommendations of the Commission and providing the
public notice and an opportunity for comment, the
Secretary shall promulgate regulations with respect to
funding and distribution requirements for USA
Retirement Funds, as necessary or appropriate in the
public interest and for the protection of participants
and beneficiaries, including regulations described in
subparagraphs (B) and (C).
(B) Requirements relating to annuity payments made
directly by a fund.--The regulations under subparagraph
(A) shall provide that in the case of annuity payments
made directly by the Fund--
(i) the maximum annuity payment for a
participant or beneficiary shall be determined
using the mortality tables and interest rates
prescribed by the Secretary under subparagraph
(C) at the time benefits commence; and
(ii) the level of benefits paid may be
adjusted periodically in order to reflect the
mortality experience and the investment
experience of the Fund, but only after the Fund
has obtained a certification from a member of
the American Academy of Actuaries that the
adjustment is sustainable for the remaining
lifetime of participants then receiving
benefits, based on the mortality tables and
interest rates prescribed under subparagraph
(C) by the Secretary for that time.
(C) Mortality tables and interest rates used
requirements.--The regulations promulgated under
subparagraph (A) shall include the following:
(i) Mortality tables.--
(I) In general.--The Secretary
shall prescribe mortality tables to be
used in determining annuity payments
made directly by the Fund. Such tables
shall be based on the actual experience
of insurance companies that issue group
annuities and projected trends in such
experience. In prescribing such tables,
the Secretary shall take into account
results of available independent
studies of the mortality of individuals
receiving annuities under group annuity
contracts.
(II) Periodic revisions of
mortality tables.--The Secretary shall
make revisions, to become effective as
soon as practicable, in any mortality
table in effect to reflect more recent
actual experience of insurance
companies that issue group annuities
and projected trends in such
experience. In revising such tables,
the Secretary shall take into account
the results of more recent available
independent studies of the mortality
and projected trends of individuals
receiving annuities under group annuity
contracts.
(ii) Interest rates.--The Secretary shall
prescribe interest rates to be used in
determining annuity payments made directly by
the Fund. Such rates shall be based on the
yields on investment grade corporate bonds with
varying maturities and that are in the top 3
quality levels available. Interest rates shall
be prescribed quarterly or more frequently, as
determined by the Secretary.
(5) Duty to address best practices.--The Commission shall
prepare, and periodically update, a report that describes the
best practices for the governance of boards of trustees of USA
Retirement Funds, including board of trustee composition,
appointment procedures, term length, term staggering, trustee
qualifications, delegation of duties, and performance
assessment procedures.
SEC. 104. LIMITATION ON EMPLOYER LIABILITY.
Section 404 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1021 et seq.) is amended by adding at the end the following:
``(e) An employer shall not be a fiduciary with respect to the
selection, management or administration of a USA Retirement Fund solely
because such employer makes available such Fund through an automatic
USA Retirement Fund arrangement. Notwithstanding the preceding
sentence, employers participating in a USA Retirement Fund shall be
responsible for meeting the enrollment requirements and transmitting
contributions, as required under the USA Retirement Funds Act.''.
SEC. 105. ENFORCEMENT AND FRAUD PREVENTION.
(a) Penalty for Failure To Timely Remit Contributions to Automatic
USA Retirement Fund Arrangements.--
(1) In general.--If an employer is required under an
automatic USA Retirement Fund arrangement to deposit amounts
withheld from an employee's compensation into a USA Retirement
Fund but fails to do so within the time prescribed under
section 101(d)(3), such amounts shall be treated as assets of a
USA Retirement Fund.
(2) Failure to provide access to payroll savings
arrangements.--
(A) General rule.--A covered employer who fails to
meet the requirements of section 101(a) for a calendar
year shall be subject to a civil money penalty of $100
per calendar year for each employee to whom such
failure relates.
(B) Exceptions.--No civil money penalty shall be
imposed under this paragraph for a failure to meet the
requirements under section 101(a)--
(i) during a period for which the Secretary
determines that the employer subject to
liability for the civil money penalty did not
know that the failure existed and exercised
reasonable diligence to meet the requirements
of section 101(a); or
(ii)(I) the employer subject to liability
for the civil money penalty exercised
reasonable diligence to meet the requirements
of section 101(a); and
(II) the employer provides the automatic
USA Retirement Fund arrangement described to
each employee eligible to participate in the
arrangement by the end of the 90-day period
beginning on the first date the employer knew,
or exercising reasonable diligence should have
known, that such failure existed.
(C) Waiver by the secretary.--In the case of a
failure to meet the requirements of section 101(a) that
is due to reasonable cause and not to willful neglect,
the Secretary may, in the sole discretion of the
Secretary, waive part or all of the civil money penalty
imposed under this paragraph to the extent that the
payment of such civil money penalty would be excessive
or otherwise inequitable relative to the failure
involved.
(D) Procedures for notice.--The Secretary may
prescribe and implement procedures for obtaining
confirmation that employers are in compliance with
subsection (a). The Secretary, in the discretion of
such Secretary, may prescribe that the confirmation
shall be obtained on an annual or less frequent basis,
and may use for this purpose the annual report or
quarterly report for employment taxes, or such other
means as the Secretary may deem advisable.
(b) Civil Actions and Enforcement.--
(1) Administration and enforcement.--Part 5 of title I of
the Employee Retirement Income Security Act of 1974 (29 U.S.C.
1132 et seq.) shall apply to a USA Retirement Fund as if a USA
Retirement Fund were an employee benefit plan.
(2) Amendment.--Section 502(a) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1132 et seq.) is
amended--
(A) in paragraph (9), by striking ``; or'' and
inserting ``;'';
(B) in paragraph (10), by striking the period at
the end and inserting ``; or''; and
(C) by adding at the end the following:
``(11) in the event that an employer fails to make timely
contributions or payments to a USA Retirement Fund established
under title I of the USA Retirement Funds Act, by the
Secretary, a participant, a beneficiary, or a fiduciary, to
compel an employer to make such contributions or payments as if
such contributions or payments were delinquent contributions or
payments under section 515 or subsection (g)(2).''.
(3) Non-preemption of certain state law.--Nothing in this
section shall preempt State law insofar as State law relates to
the enforcement of an obligation to contribute to a USA
Retirement Fund.
(c) False Statements.--
(1) In general.--No person, in connection with a plan or
other arrangement that is or purports to be a USA Retirement
Fund, shall make a false statement or false representation of
fact, knowing it to be false, in connection with the marketing
or sale of such plan or arrangement, to any employee, any
member of an employee organization, any beneficiary, any
employer, any employee organization, the Secretary, or any
State, or the representative or agent of any such person,
State, or the Secretary, concerning--
(A) the financial condition or solvency of such
fund or arrangement;
(B) the benefits provided by such fund or
arrangement;
(C) the regulatory status of such fund or other
arrangement under any Federal or State law governing
collective bargaining, labor management relations, or
intern union affairs; or
(D) the regulatory status of such fund or other
arrangement.
(2) Penalty.--Any person who violates this subsection
shall, upon conviction, be imprisoned not more than 10 years or
fined under title 18, United States Code, or both.
(d) Cease and Desist Orders.--
(1) Issuance of order.--The Secretary may issue a cease and
desist (ex parte) order under this title if the Secretary
determines that the alleged conduct of a fund purporting to be
a USA Retirement Fund is fraudulent, or creates an immediate
danger to the public safety or welfare, or is causing or can be
reasonably expected to cause significant, imminent, and
irreparable public injury.
(2) Hearings.--
(A) In general.--A person who is adversely affected
by the issuance of a cease and desist order under
paragraph (1) may request a hearing by the Secretary
regarding such order. The Secretary may require that a
hearing under this paragraph, including all related
information and evidence, be conducted in a
confidential manner.
(B) Burden of proof.--The burden of proof in any
hearing conducted under subparagraph (A) shall be on
the party requesting the hearing to show cause why the
cease and desist order should be set aside.
(C) Determination.--Based upon the evidence
presented at a hearing under subparagraph (A), the
Secretary may affirm, modify, or set aside the cease
and desist order at issue, in whole or in part.
(3) Regulations.--The Secretary may promulgate such
regulations or other guidance as may be necessary or
appropriate to carry out this subsection.
TITLE II--DEFINED CONTRIBUTION PLAN REFORMS
Subtitle A--Savings Enhancements
SEC. 201. POOLED EMPLOYER PLANS.
(a) No Common Interest Required for Pooled Employer Plans.--Section
3(2) of the Employee Retirement Income Security Act of 1974 (29 U.S.C.
1002(2)) is amended by adding at the end the following:
``(C) A pooled employer plan shall be treated as a
single employee pension benefit plan or single pension
plan without regard to whether the participating
employers share a common interest other than
participation in the plan.''.
(b) Pooled Employer Plan and Provider Defined.--Section 3 of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002) is
amended by adding at the end the following:
``(43)(A) The term `pooled employer plan' means a pension
plan (without regard to whether any participating employers
share a common interest other than participation in the plan)
that is a single individual account plan established or
maintained for the purpose of providing benefits to the
employees of 2 or more employers but only if--
``(i) the terms of the plan designate a pooled plan
provider,
``(ii) under the plan each participating employer
retains fiduciary responsibility for--
``(I) the prudent selection and monitoring
of the person designated as the pooled employer
plan provider and, if different from the
provider, the person designated as the plan's
named fiduciary, and
``(II) to the extent not otherwise
delegated to another fiduciary, the investment
and management of that portion of the plan's
assets attributable to the employees of that
participating employer,
``(iii) under the plan a participating employer is
not subject to unreasonable restrictions, fees, or
penalties with regard to ceasing participation or
otherwise transferring assets of the plan in accordance
with section 414(l) of the Internal Revenue Code of
1986, and
``(iv) the pooled employer plan provider provides
to participating employers any disclosures or other
information as the Secretary may require.
``(B) The term `pooled employer plan' does not include--
``(i) a multiemployer plan, or
``(ii) a plan established before January 1, 2014,
or any successor thereof.
``(44)(A) The term `pooled plan provider' means a person
who--
``(i) is designated by the terms of a pooled
employer plan as a pooled plan provider;
``(ii) registers as a pooled plan provider with the
Secretary and provides such other identifying
information to the Secretary as the Secretary may
require; and
``(iii) has such educational or professional
qualifications as the Secretary may require.
``(B) The Secretary may perform examinations and
investigations of pooled plan providers as may be necessary to
enforce and carry out the purposes of the Act.
``(C) For purposes of this section, the following shall be
treated as a single pooled plan provider:
``(i) All corporations that provide services to a
plan and are members of a controlled group of
corporations within the meaning of section 1563(a) of
the Internal Revenue Code of 1986 (determined without
regard to subsection (a)(4) of such section 1563).
``(ii) All persons treated as a single employer
under section 210(d).''.
(c) Technical Amendment.--Section 3 of such Act is amended by
striking the second paragraph (41).
SEC. 202. POOLED EMPLOYER AND MULTIPLE EMPLOYER PLAN REPORTING.
(a) Additional Information.--Section 103 of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1023) is amended--
(1) in subsection (a)(1)(B), by striking ``applicable
subsections (d), (e), and (f)'' and inserting ``applicable
subsections (d), (e), (f), and (g)''; and
(2) by adding at the end the following:
``(g) Additional Information With Respect to Pooled Employer and
Multiple Employer Plans.--An annual report under this section for a
plan year shall include--
``(1) with respect to any pooled employer plan or other
pension plan maintained by more than one employer (other than a
multiemployer plan), a list of participating employers and a
good faith estimate of the percentage of the total
contributions made, or expected to be made, by each such
participating employer for the plan year, and
``(2) with respect to a pooled employer plan, the
identifying information for the person designated under the
terms of the plan as the pooled plan provider.''.
(b) Simplified Annual Reports.--Section 104(a) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1024(a)) is amended
by striking paragraph (2)(A) and inserting the following:
``(2)(A) With respect to annual reports required to be
filed with the Secretary under this part, the Secretary may by
regulation prescribe simplified annual reports for any pension
plan that--
``(i) covers fewer than 100 participants, or
``(ii) is a pooled employer plan (as defined in
section 3(43)) that covers fewer than 1,000
participants but only if no single participating
employer has more than 100 participants covered by the
plan.''.
(c) Effective Date.--The amendments made by this section shall
apply to annual reports for plan years beginning after December 31,
2014.
Subtitle B--Participant Protections
SEC. 211. ALTERNATIVE FIDUCIARY ARRANGEMENTS TO PROTECT PLAN
PARTICIPANTS.
Section 405 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1105) is amended by adding at the end the following:
``(e) Small Employer Plan Alternative Fiduciary Arrangements.--
``(1) In general.--A small employer that is a plan sponsor
of an employee pension benefit plan shall not be liable for a
breach of fiduciary responsibility of a small employer plan
service provider with respect to the same plan if the
requirements of the following subparagraphs are met:
``(A) Small employer plan sponsor requirements.--
The requirements of this subparagraph are met if the
small employer prudently selects and monitors the small
employer plan named fiduciary.
``(B) Small employer plan named fiduciary
requirements.--The requirements of this subparagraph
are met if the small employer plan named fiduciary--
``(i) engages a small employer plan service
provider with respect to the employee pension
benefit plan;
``(ii) registers as a small employer plan
named fiduciary with the Secretary in
accordance with paragraph (2)(A);
``(iii) has such educational or
professional qualifications as the Secretary
may require;
``(iv) provides to employers disclosures or
other information as may be required by the
Secretary by regulations to facilitate
monitoring of the named fiduciary;
``(v) is bonded in accordance with section
412; and
``(vi) meets the financial responsibility
requirements of paragraph (2)(B).
``(2) Rules relating to named fiduciary requirements.--
``(A) Reporting by small employer plan named
fiduciary.--For purposes of paragraph (1)(B)(ii), the
small employer plan named fiduciary shall file the
required registration with the Secretary--
``(i) before the date upon which the safe
harbor provided in this subsection first
applies to a small employer plan sponsor and at
such other times as the Secretary may prescribe
by regulations, and
``(ii) in such form and manner, and
containing such information, as the Secretary
determines necessary or appropriate to carry
out the purposes of this Act.
``(B) Financial responsibility requirements.--For
purposes of paragraph (1)(B)(vi), a small employer plan
named fiduciary shall meet the requirements of this
subparagraph if the fiduciary either--
``(i) has fiduciary liability insurance
with a per-claim limit equal to no less than--
``(I) the greater of 5 percent of
plan assets or $1,000,000; or
``(II) such other amount as is
determined by the Secretary by
regulation; or
``(ii) is--
``(I) a bank, as defined in section
202(a)(2) of the Investment Advisers
Act of 1940, that has the power to
manage, acquire, or dispose of assets
of a plan, and that has, as of the last
day of its most recent fiscal year,
equity capital in excess of $1,000,000;
``(II) a savings and loan
association, the accounts of which are
insured by the Federal Savings and Loan
Insurance Corporation, that has made
application for and been granted trust
powers to manage, acquire, or dispose
of assets of a plan by a State or
Federal authority having supervision
over savings and loan associations, and
that has, as of the last day of its
most recent fiscal year, equity capital
or net worth in excess of $1,000,000;
``(III) an insurance company that
is subject to supervision and
examination by a State authority having
supervision over insurance companies,
that is qualified under the laws of
more than one State to manage, acquire,
or dispose of assets of a plan, and
that has, as of the last day of its
most recent fiscal year, net worth in
excess of $1,000,000; or
``(IV) an investment adviser
registered under the Investment
Advisers Act of 1940 that, as of the
last day of its most recent fiscal
year, has total client assets under its
management and control in excess of
$85,000,000 and shareholders' or
partners' equity in excess of
$1,000,000.
``(C) Adjustment of amounts.--The Secretary may by
regulation adjust the dollar amounts under subparagraph
(B)(ii).
``(3) Administrative summary cease and desist orders and
summary seizure orders against small employer plan named
fiduciary.--
``(A) In general.--The Secretary may issue an ex
parte cease and desist order under this title if the
Secretary--
``(i) determines that a small plan named
fiduciary or small employer plan service
provider has not met the requirements under
paragraph (1) or (2); or
``(ii) has reasonable cause to believe that
the named fiduciary or service provider has
engaged in or is about to engage in conduct
that is a violation of this title or that the
Secretary determines to be contrary to accepted
standards of plan operations that might result
in abnormal risk to the plan or participants
and beneficiaries of the plan.
``(B) Hearings.--
``(i) In general.--A person that is
adversely affected by the issuance of a cease
and desist order under subparagraph (A) may
request a hearing by the Secretary regarding
such order.
``(ii) Confidentiality.--The Secretary may
require that a hearing under this subparagraph,
including all related information and evidence,
be conducted in a confidential manner.
``(iii) Burden of proof.--The burden of
proof in any hearing conducted under this
subparagraph shall be on the party requesting
the hearing to show cause why the cease and
desist order should be set aside.
``(iv) Determination.--Based upon the
evidence presented at a hearing under this
subparagraph, the Secretary may affirm, modify,
or set aside the cease and desist order, in
whole or in part.
``(C) Seizure.--The Secretary may issue a summary
seizure order under this subtitle if the Secretary
determines that a small employer plan named fiduciary
or small employer plan service provider is in a
financially hazardous condition.
``(D) Regulations.--The Secretary may promulgate
such regulations or other guidance as may be necessary
or appropriate to carry out this paragraph.
``(E) Exception.--This paragraph shall not apply to
any named fiduciary that is not a named fiduciary under
paragraph (1)(A) or small employer plan service
provider under paragraph (1)(B)(i).
``(F) Savings clause.--The Secretary's authority
under this paragraph shall not be construed to limit
the Secretary's ability to exercise enforcement or
investigatory authority under any other provision of
this title. The Secretary may, in the sole discretion
of the Secretary, initiate court proceedings without
using the procedures in this paragraph.
``(4) Definitions.--For purposes of this subsection--
``(A) Small employer.--
``(i) In general.--The term `small
employer' means, with respect to any year, an
employer that did not have more than 50
employees on any day during the preceding year.
``(ii) 2-year grace period.--A small
employer that establishes and maintains an
employee pension benefit plan for 1 or more
years and that is not a small employer for any
subsequent year shall be treated as a small
employer for the 2 years following the last
year the employer was a small employer. If such
employer is not a small employer as described
in the preceding sentence on account of an
acquisition, disposition, or similar
transaction involving a small employer, the
preceding sentence shall not apply.
``(B) Small employer plan named fiduciary.--The
term `small employer plan named fiduciary' means the
fiduciary that is designated as the small employer plan
named fiduciary in the instrument under which an
employee pension benefit plan is maintained.
``(C) Small employer plan service provider.--The
term `small employer plan service provider' means--
``(i) an administrator (as defined in
section 3(16)(A));
``(ii) a fiduciary (as defined in section
3(21)(A)); or
``(iii) an investment manager (as defined
in section 3(38)),
that is independent from the small employer plan named
fiduciary.''.
SEC. 212. ROLLOVER PROTECTIONS.
(a) Sense of Congress.--It is the sense of Congress that a person
may be providing investment advice within the meaning of section 3(21)
of the Employee Retirement Income Security Act of 1974 (29 U.S.C.
1002(21)) when such person advises a plan participant to take a
permissible plan distribution and such distribution advice is combined
with a recommendation as to how the distribution should be invested.
(b) Guidance.--Not later than 90 days after the date of enactment
of this Act, the Secretary of Labor shall issue guidance consistent
with subsection (a) clarifying the applicability of section 3(21) of
the Employee Retirement Income Security Act of 1974 to investment
advice provided in connection with distribution recommendations.
(c) Fiduciary and Prohibited Transaction Awareness.--The
Comptroller General of the United States shall study the extent to
which advisors, broker-dealers, and other financial professionals
dealing with individual and employer-provided retirement plans are
aware of, and receive ongoing training regarding, the requirements of
part 4 of subtitle B of title I of the Employee Retirement Income
Security Act (29 U.S.C. 1101 et seq.) and section 4975 of the Internal
Revenue Code of 1986. The Comptroller General shall submit a report to
the Committee on Health, Education, Labor, and Pensions of the Senate
and the Committee on Education and the Workforce of the House of
Representatives summarizing its findings and including recommendations
regarding ways to improve awareness of and compliance with the
fiduciary and prohibited transaction rules.
Subtitle C--Lifetime Income
SEC. 221. LIFETIME INCOME DISCLOSURE.
(a) Requirements To Provide Pension Benefit Statements.--Section
105(a)(2)(B) of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1025(a)(2)(B)) is amended--
(1) in clause (i), by striking ``and'' at the end;
(2) in clause (ii), by striking the period at the end and
inserting ``, and''; and
(3) by adding at the end the following:
``(iii) an illustration of the
participant's benefit as an estimated lifetime
income stream beginning at retirement
determined in accordance with assumptions and
requirements established by regulation.''.
(b) Limitation on Liability.--Section 404 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1104), as amended by
section 105, is amended by adding at the end the following:
``(f) Limitation on Liability.--No plan fiduciary, plan sponsor, or
other person shall have any liability under this title solely by reason
of providing an illustration as required under section
105(a)(2)(B)(iii).''.
(c) Regulations.--Not later than 1 year after the date of the
enactment of this Act, the Secretary of Labor shall issue regulations
implementing the amendments made by subsections (a) and (b).
(d) Clarification.--The requirement under section 105(a)(2)(B)(iii)
of the Employee Retirement Income Security Act of 1974, as added by
subsection (a)(3), shall apply to pension benefit statements furnished
more than 1 year after the issuance of the final rules implementing
section 105(a)(2)(B)(iii) of such Act.
SEC. 222. LIFETIME INCOME SAFE HARBOR.
Section 404 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1104), as amended by sections 105 and 221(b), is amended by
adding at the end the following:
``(g) Safe Harbor for Annuity Selection.--
``(1) In general.--With respect to the selection of a
lifetime retirement income contract as part of an individual
account plan, a fiduciary will be deemed to satisfy the
requirements of subsection (a)(1)(B) with respect to the
selection of an insurer and lifetime retirement income contract
if the fiduciary engages in an objective, thorough, and
analytical search for the purpose of identifying insurers from
which to purchase lifetime retirement income contracts and
appropriately concludes that--
``(A) at the time of the selection, the insurer is
financially capable of satisfying its obligations under
the lifetime income contract; and
``(B) the cost (including fees, surrender
penalties, and commissions) of the selected lifetime
retirement income contract is reasonable in relation to
the benefits and product features of the contract and
the administrative services to be provided under such
contract.
``(2) Fiduciaries.--A fiduciary meets the requirements of
paragraph (1)(A) if the fiduciary meets all of the following
conditions:
``(A) The fiduciary obtains written representations
from the insurer that--
``(i) the insurer is licensed to offer
lifetime retirement income contracts;
``(ii) the insurer, at the time of
selection and for each of the immediately
preceding 10 years--
``(I) operates under a certificate
of authority from the Insurance
Commissioner of its domiciliary state
that has not been revoked or suspended;
``(II) has filed financial
statements in accordance with the laws
of its domiciliary state under
applicable statutory accounting
principles;
``(III) maintains reserves that
satisfy all the statutory requirements
of all States where the insurer does
business; and
``(IV) is not operating under an
order of supervision, rehabilitation,
or liquidation;
``(iii) the insurer undergoes, at least
every 5 years, a financial examination (within
the meaning of the law of the State in which
the insurer is domiciled) by the insurance
commissioner of the domiciliary State (or any
representative, designee, or other party
approved thereby);
``(iv) if, following the issuance of the
representations described in clauses (i)
through (iii), there is any change that would
preclude the insurer from making such
representations at the time of issuance of the
lifetime retirement income contract, the
insurer will inform the fiduciary that the
fiduciary can no longer rely on one or more of
the representations; and
``(v) meet such other requirements
specified by the Secretary by regulation.
``(B) The fiduciary has not received the
notification described in clause (iv) of subparagraph
(A) and has no other facts that would cause the
fiduciary to question the representations described in
clauses (i) through (iii) of subparagraph (A).
``(C) The fiduciary inquires about additional
protections that might be available through a State
guaranty association for the lifetime retirement income
contract.
``(D) The fiduciary obtains evidence from the
insurer that, not more than 1 year prior to the time of
selection, the insurer has obtained written
confirmation from the insurance commissioner of the
domiciliary State of such insurer that, at the time the
confirmation is issued, the insurer met the conditions
of clauses (i) and (ii) of subparagraph (A).
``(3) Time of selection.--For purposes of this subsection,
the `time of selection' is--
``(A) the time that the insurer and contract are
selected for distribution of benefits to a specific
participant or beneficiary; or
``(B) the time that the insurer and contract are
selected to provide benefits at future dates to
participants or beneficiaries, but only if the
selecting fiduciary periodically reviews the continuing
appropriateness of the conclusion described in
paragraph (1)(A).
``(4) Periodic review.--For purposes of paragraph (3)(B), a
fiduciary is not required to review the appropriateness of the
conclusion under paragraph (1)(A) before or after the purchase
of any contract for specific participants or beneficiaries. A
fiduciary will be deemed to have conducted a periodic review of
the financial capability of the insurer if the fiduciary
obtains the written representations described in clauses (i)
through (iii) of paragraph (2)(A) on an annual basis, unless,
in the interim, the fiduciary becomes aware of facts that would
cause the fiduciary to question such representations.
``(5) Definitions.--For purposes of this subsection--
``(A) the term `insurer' means an insurance
company, insurance service, or insurance organization
qualified to do business in a State and includes
affiliates of such companies to the extent the
affiliate is licensed to offer lifetime retirement
income contracts; and
``(B) the term `lifetime retirement income
contract' means an annuity contract or a contract (or
provision or feature thereof) that provides a
participant fixed or variable benefits for a fixed term
or the remainder of the life of the participant or the
joint lives of the participant and the designated
beneficiary of the participant.
``(6) Savings clause.--Nothing in this subsection shall be
construed to establish minimum requirements or the exclusive
means for a fiduciary to satisfy the fiduciary duties under
subsection (a)(1)(B). Nothing in this subsection shall be
construed to require a fiduciary to select the lowest cost
contract. A fiduciary may consider the value, including
features and benefits of the contract and attributes of the
insurer, in conjunction with the contract's cost. Attributes of
the insurer that may be considered may include, without
limitation, the issuer's financial strength.''.
SEC. 223. DEFAULT INVESTMENT SAFE HARBOR CLARIFICATION.
(a) In General.--Section 404(c)(5) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1104(c)(5)) is amended by adding
at the end the following:
``(C) Availability of options.--The availability of
annuity purchase rights, death benefit guarantees,
investment guarantees, or other features in insurance
contracts will not, in and of themselves, affect the
status of a fund, product, or portfolio as a default
investment under this paragraph.''.
(b) Rules of Construction.--The amendment made by subsection (a)
shall be construed to codify existing law and shall not be construed as
modifying the regulations promulgated by the Secretary of Labor under
section 404(c)(5) of Employee Retirement Income Security Act of 1974
(29 U.S.C. 1104(c)(5)), as in effect before the amendment made by this
section.
SEC. 224. ADMINISTRATION OF JOINT AND SURVIVOR ANNUITY REQUIREMENTS.
(a) Option To Appoint Annuity Administrators.--Section 402(c) of
the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1102(c))
is amended--
(1) in paragraph (2), by striking ``or'' at the end,
(2) in paragraph (3), by striking the period at the end and
inserting ``; or'', and
(3) by adding at the end the following new paragraph:
``(4) that a named fiduciary, or a fiduciary designated by
a named fiduciary pursuant to a plan procedure described in
section 405(c)(1), may appoint an annuity administrator or
administrators with responsibility for administration of an
individual account plan in accordance with the requirements of
section 205 and payment of any annuity required thereunder.''.
(b) Liability of Annuity Administrator.--Section 405 of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1105), as
amended by section 211(a), is amended by adding at the end the
following:
``(f) Annuity Administrator.--If 1 or more persons has been
appointed under section 402(c)(4) as an annuity administrator or
administrators of an individual account plan, and each such person
acknowledges in writing that such person is the annuity administrator
and a fiduciary under the plan with respect to appointed duties,
neither the named fiduciary nor any appointing fiduciary shall be
liable for any act or omission of the annuity administrator except to
the extent that--
``(1) the named fiduciary or appointing fiduciary violated
section 404(a)(1)--
``(A) with respect to such appointment; or
``(B) in continuing the appointment;
``(2) the named fiduciary or appointing fiduciary would
otherwise be liable in accordance with subsection (a); or
``(3) the entity appointed to be the annuity administrator
is not an insurance company or approved to be an annuity
administrator by the Secretary.''.
TITLE III--DEFINED BENEFIT SYSTEM REFORMS
Subtitle A--Defined Benefit Pension Plan Reforms
SEC. 301. HYBRID PLANS.
(a) Amendments to ERISA.--
(1) Reasonable minimum rates disregarded.--Section
204(b)(5)(B)(i) of the Employee Retirement Income Security Act
of 1974 (29 U.S.C. 1054(b)(5)(B)(i)) is amended--
(A) in subclause (I), by adding at the end the
following new sentence: ``Any rate described in
subclause (IV) or (V) shall be disregarded in
determining whether a plan is treated as satisfying the
requirements of the first sentence of this
subclause.''; and
(B) by adding at the end the following:
``(IV) Reasonable minimum
guaranteed rates for investment-based
interest credits.--In the case of an
interest credit (or equivalent amount)
that is based on an actual investment
(or on an index that is structured to
have effects similar to the effects of
an actual investment), a fixed annual
crediting rate equal to 3 percent (or a
lower rate not less than zero that is
specified in the plan) with respect to
all contribution credits credited to a
participant's account balance or
similar amount during the guarantee
period shall be treated as a reasonable
minimum guaranteed rate of return. For
purposes of this subclause, the
guarantee period begins on the
prospective date that such reasonable
minimum guaranteed rate applies to the
participant's benefit under the plan
and ends on the date that such
reasonable minimum guaranteed rate
ceases to apply to the participant's
benefit.
``(V) Reasonable minimum rates for
other interest crediting bases.--In the
case of an interest credit (or
equivalent amount) that is not
described in subclause (IV), an annual
interest rate equal to the lowest
interest rate permitted with respect to
any plan under section 415(b)(2)(E)(i)
of the Internal Revenue Code of 1986
(without regard to section
415(b)(2)(E)(ii) of such Code) shall be
treated as a reasonable minimum
guaranteed rate of return described in
such subclause.''.
(2) Permitted fixed rates.--Section 204(b)(5)(B)(i) of such
Act (29 U.S.C. 1054(b)(5)(B)(i)), as amended by paragraph
(1)(B), is amended by adding at the end the following:
``(VI) Permitted fixed rate of
return.--An annual interest crediting
rate that is a fixed annual crediting
rate and that does not exceed the rate
described in subclause (V) plus one
percentage point shall be deemed to
satisfy the requirements of subclause
(I).''.
(3) Protecting plan participants from losing access to
market rates.--
(A) In general.--Section 204(b)(5)(B) of such Act
(29 U.S.C. 1054(b)(5)(B)(i)(III)) is amended by adding
at the end the following new clause:
``(iii) Special rules relating to market
rate of return.--For purposes of clause
(i)(III)--
``(I) In general.--Except as
provided in this subclause, any rate of
return available in the market, shall,
under the regulation under clause
(i)(III), be permitted as a market rate
of return under clause (i)(I).
``(II) Secretarial authority.--
Except as provided in subclause (III),
the Secretary of the Treasury may
prescribe by regulation that a rate of
return available in the market is not
permitted under clause (i)(I) if such
rate is designed to evade the purposes
of clause (i)(I) and is not consistent
with the purposes of a defined benefit
plan. Such authority shall apply only
to a rate of return based exclusively
or primarily on the returns on employer
securities (as defined in section
407(d)(1)), on alternative investments
generally not appropriate as an
exclusive or primary investment for
retirement, or on other similar
investments.
``(III) Specified safe harbor
rates.--The following rates of return
and any combination of such rates shall
be deemed to be market rates of return
that satisfy clause (i)(I):
``(aa) The first, second,
or third segment rate (as
defined in section 430(h)(2)(C)
of the Internal Revenue Code of
1986 (without regard to clause
(iv) thereof)) or any
combination of such rates.
``(bb) The discount rate on
3-month, 6-month, and 12-month
Treasury bills with appropriate
margins determined under
regulations prescribed by the
Secretary of the Treasury.
``(cc) The yield on 1-year,
2-year, 3-year, 5-year, 7-year,
10-year, and 30-year Treasury
Constant Maturities with
appropriate margins determined
under regulations prescribed by
the Secretary of the Treasury.
``(dd) The actual return on
all or a diversified portion of
the assets of the plan.
``(ee) Any total return
index or price index commonly
used as an investment
benchmark, as determined under
regulations prescribed by the
Secretary of the Treasury.
``(ff) The rate of return
on an annuity contract for a
participant issued by an
insurance company licensed
under the laws of a State.
``(gg) A cost of living
index with appropriate margin,
as determined under regulations
promulgated by the Secretary of
the Treasury.
``(hh) The rate of return
on a broad-based regulated
investment company, as
determined under regulations
promulgated by the Secretary of
the Treasury.
``(ii) Any investment in
which participants may elect to
invest under a defined
contribution plan maintained by
the sponsor of the plan other
than an investment with a rate
of return prohibited under
clause (i), a stable value
fund, or an investment
available only through a
brokerage account (or similar
arrangement).''.
(b) Amendments to 1986 Code.--
(1) Reasonable minimum rates disregarded.--Section
411(b)(5)(B)(i) of the Internal Revenue Code of 1986 is
amended--
(A) in subclause (I), by adding at the end the
following new sentence: ``Any rate described in
subclause (IV) or (V) shall be disregarded in
determining whether a plan is treated as satisfying the
requirements of the first sentence of this
subclause.''; and
(B) by adding at the end the following:
``(IV) Reasonable minimum
guaranteed rates for investment-based
interest credits.--In the case of an
interest credit (or equivalent amount)
that is based on an actual investment
(or on an index that is structured to
have effects similar to the effects of
an actual investment), a fixed annual
crediting rate equal to 3 percent (or a
lower rate not less than zero that is
specified in the plan) with respect to
all contribution credits credited to a
participant's account balance or
similar amount during the guarantee
period shall be treated as a reasonable
minimum guaranteed rate of return. For
purposes of this subclause, the
guarantee period begins on the
prospective date that such reasonable
minimum guaranteed rate applies to the
participant's benefit under the plan
and ends on the date that such
reasonable minimum guaranteed rate
ceases to apply to the participant's
benefit.
``(V) Reasonable minimum rates for
other interest crediting bases.--In the
case of an interest credit (or
equivalent amount) that is not
described in subclause (IV), an annual
interest rate equal to the lowest
interest rate permitted with respect to
any plan under section 415(b)(2)(E)(i)
(without regard to section
415(b)(2)(E)(ii)) shall be treated as a
reasonable minimum guaranteed rate of
return described in such subclause.''.
(2) Permitted fixed rates.--Section 411(b)(5)(B)(i) of such
Code, as amended by paragraph (1)(B), is further amended by
adding at the end the following:
``(VI) Permitted fixed rate of
return.--An annual interest crediting
rate that is a fixed annual crediting
rate and that does not exceed the rate
described in subclause (V) plus one
percentage point shall be deemed to
satisfy the requirements of subclause
(I).''.
(3) Protecting plan participants from losing access to
market rates.--
(A) In general.--Section 411(b)(5)(B) of such Code
is amended by adding at the end the following:
``(iii) Special rules relating to market
rate of return.--For purposes of clause
(i)(III)--
``(I) In general.--Except as
provided in this subclause, any rate of
return available in the market, shall,
under the regulation under clause
(i)(III), be permitted as a market rate
of return under clause (i)(I).
``(II) Secretarial authority.--
Except as provided in subclause (III),
the Secretary may prescribe by
regulation that a rate of return
available in the market is not
permitted under clause (i)(I) if such
rate is designed to evade the purposes
of clause (i)(I) and is not consistent
with the purposes of a defined benefit
plan. Such authority shall apply only
to a rate of return based exclusively
or primarily on the returns on employer
securities (as defined in section
407(d)(1)), on alternative investments
generally not appropriate as an
exclusive or primary investment for
retirement, or on other similar
investments.
``(III) Specified safe harbor
rates.--The following rates of return
and any combination of such rates shall
be deemed to be market rates of return
that satisfy clause (i)(I):
``(aa) The first, second,
or third segment rate (as
defined in section 430(h)(2)(C)
(without regard to clause (iv)
thereof)) or any combination of
such rates.
``(bb) The discount rate on
3-month, 6-month, and 12-month
Treasury bills with appropriate
margins determined under
regulations prescribed by the
Secretary.
``(cc) The yield on 1-year,
2-year, 3-year, 5-year, 7-year,
10-year, and 30-year Treasury
Constant Maturities with
appropriate margins determined
under regulations prescribed by
the Secretary.
``(dd) The actual return on
all or a diversified portion of
the assets of the plan.
``(ee) Any total return
index or price index commonly
used as an investment
benchmark, as determined under
regulations prescribed by the
Secretary.
``(ff) The rate of return
on an annuity contract for a
participant issued by an
insurance company licensed
under the laws of a State.
``(gg) A cost of living
index with appropriate margin,
as determined under regulations
promulgated by the Secretary.
``(hh) The rate of return
on a broad-based regulated
investment company, as
determined under regulations
promulgated by the Secretary.
``(ii) Any investment in
which participants may elect to
invest under a defined
contribution plan maintained by
the sponsor of the plan other
than an investment with a rate
of return prohibited under
clause (i), a stable value
fund, or an investment
available only through a
brokerage account (or similar
arrangement).''.
(c) Protecting Plan Participants From Retroactive Benefit
Decreases.--
(1) In general.--If an interest credit (or equivalent
amount) under a plan subject to section 411(b)(5)(B)(i)(I) of
the Internal Revenue Code of 1986 or section 204(b)(5)(B)(i)(I)
of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1054(b)(5)(B)(i)(I)) was reasonable in relation to
market rates in existence when such interest credit (or
equivalent amount) was established (disregarding any minimum
rates of return that were reasonable when established), such
interest credit (or equivalent amount) shall be treated as
satisfying the requirements of section 411(b)(5)(B)(i)(I) of
such Code and section 204(b)(5)(B)(i)(I) of such Act for the
transition period.
(2) Transition period.--For purposes of paragraph (1), the
transition period, with respect to any plan, begins on the date
that section 411(b)(5)(B)(i)(I) of such Code or section
204(b)(5)(B)(i)(I) of such Act first applied to such plan and
ends on the effective date of comprehensive final regulations
under such sections prescribed by the Secretary of the
Treasury.
(d) Ensuring Fairness When Interest Credits Are Required To Be
Decreased.--
(1) In general.--In the case of an interest credit (or
equivalent amount) under a plan subject to section
411(b)(5)(B)(i)(I) of the Internal Revenue Code of 1986 or
section 204(b)(5)(B)(i)(I) of the Employee Retirement Income
Security Act of 1974 that is in effect for the last plan year
prior to the effective date of comprehensive final regulations
under such section of such Code but does not comply with such
regulations determined after application of subsection (c), the
Secretary of the Treasury shall provide an exception from the
requirements of section 411(d)(6) of such Code and section
204(g) of such Act for a reduction in such interest credit (or
equivalent amendment) that is made pursuant to such
comprehensive final regulations.
(2) Exception.--The exception under paragraph (1) from
section 204(g) of such Act and section 411(d)(6) of such Code
shall be issued through regulations to ensure the opportunity
of interested persons to make comments through a public notice
and comment process. Such exception shall permit any interest
credit (or equivalent amount) to which this subsection applies
to be modified to be the maximum fixed rate of return permitted
under section 204(b)(5)(B)(i)(VI) of such Act or section
411(b)(5)(B)(i)(VI) of such Code or to be the maximum rate
permitted under any rate of return deemed to be a market rate
of return pursuant to section 204(b)(5)(B)(i)(III) of such Act
or section 411(b)(5)(B)(i)(III) of such Code. The Secretary of
the Treasury shall further structure the exception to ensure
that there are clear and simple methods for plans to comply
with the requirements of section 204(b)(5)(B)(i)(I) of such Act
and section 411(b)(5)(B)(i)(I) of such Code.
(e) Protecting Participants From Plan Freezes Through Appropriate
Transition Rules.--
(1) In general.--In the case of any defined benefit plan to
which this subsection applies, comprehensive regulations under
sections 203(f)(1) and 204(b)(5)(B)(i) of the Employee
Retirement Income Security Act of 1974 or sections
411(a)(13)(A) and 411(b)(5)(B)(i) of the Internal Revenue Code
of 1986 shall not take effect before the first plan year
beginning at least 1 year after the later of--
(A) the date of publication of such regulations; or
(B) the date of publication of the regulations
described in subsection (d).
(2) Pension equity plans.--This subsection applies to any
defined benefit plan that--
(A) is subject to section 204(b)(5) of the Employee
Retirement Income Security Act of 1974 or section
411(b)(5) of the Internal Revenue Code of 1986;
(B) expresses any portion of any participant's
benefit as a current value equal to an accumulated
percentage of the employee's final average
compensation; and
(C) in the absence of guidance from the Secretary
of the Treasury or the Secretary of Labor, has been
structured in a reasonable, good faith manner to comply
with the requirements of such Code and such Act with
respect to benefits described in subparagraph (B).
(3) Period prior to effective date of regulations.--In the
case of a plan to which this subsection applies, no rule shall
be issued and no adverse enforcement action shall be taken by
the Secretary of the Treasury or the Secretary of Labor with
respect to a plan described in paragraph (2) regarding the
structure of the benefits described in paragraph (2)(B) for any
period prior to the effective date of comprehensive final
regulations issued by the Secretary of the Treasury with
respect to such benefits. Such final regulations shall not be
effective before the first plan year beginning at least 1 year
after publication of such regulations.
(f) Effective Date.--
(1) In general.--Except as otherwise provided, the
amendments and other provisions of this section shall take
effect as if included in section 701 of the Pension Protection
Act of 2006 (Public Law 109-280; 120 Stat. 981).
(2) Hold harmless.--With respect to any period prior to the
effective date of the comprehensive regulations described in
subsection (e), no plan shall fail to comply with any
requirement of the Employee Retirement Income Security Act of
1974 or of the Internal Revenue Code of 1986 by reason of
complying with the law in effect without regard to the
amendments made by subsections (a) and (b).
SEC. 302. CLARIFICATION OF THE NORMAL RETIREMENT AGE.
(a) Amendments to ERISA.--Section 204 of the Employee Retirement
Income Security Act of 1974 is amended by redesignating subsection (k)
as subsection (l) and by inserting after subsection (j) the following
new subsection:
``(k) Special Rule for Determining Normal Retirement Age for
Certain Existing Defined Benefit Plans.--
``(1) In general.--For purposes of section 3(24), an
applicable plan shall not be treated as failing to meet any
requirement of this title, or as failing to have a uniform
normal retirement age for purposes of this title, solely
because the plan has adopted the normal retirement age
described in paragraph (2).
``(2) Applicable plan.--For purposes of this subsection--
``(A) In general.--The term `applicable plan' means
a defined benefit plan that, on the date of the
introduction of this subsection, has adopted a normal
retirement age which is the earlier of--
``(i) an age otherwise permitted under
section 2(24), or
``(ii) the age at which a participant
completes the number of years (not less than 30
years) of benefit accrual service specified by
the plan.
A plan shall not fail to be treated as an applicable
plan solely because, as of such date, the normal
retirement age described in the preceding sentence only
applied to certain participants or to certain employers
participating in the plan.
``(B) Expanded application.--If, after the date
described in subparagraph (A), an applicable plan
expands the application of the normal retirement age
described in subparagraph (A) to additional
participants or participating employers, such plan
shall also be treated as an applicable plan with
respect to such participants or participating
employers.''.
(b) Amendment to 1986 Code.--Section 411 of the Internal Revenue
Code of 1986 is amended by adding at the end the following new
subsection:
``(f) Special Rule for Determining Normal Retirement Age for
Certain Existing Defined Benefit Plans.--
``(1) In general.--For purposes of subsection (a)(8)(A), an
applicable plan shall not be treated as failing to meet any
requirement of this subchapter, or as failing to have a uniform
normal retirement age for purposes of this subchapter, solely
because the plan has adopted the normal retirement age
described in paragraph (2).
``(2) Applicable plan.--For purposes of this subsection--
``(A) In general.--The term `applicable plan' means
a defined benefit plan that, on the date of the
introduction of this subsection, has adopted a normal
retirement age which is the earlier of--
``(i) an age otherwise permitted under
subsection (a)(8)(A), or
``(ii) the age at which a participant
completes the number of years (not less than 30
years) of benefit accrual service specified by
the plan.
A plan shall not fail to be treated as an applicable
plan solely because, as of such date, the normal
retirement age described in the preceding sentence only
applied to certain participants or to certain employers
participating in the plan.
``(B) Expanded application.--If, after the date
described in subparagraph (A), an applicable plan
expands the application of the normal retirement age
described in subparagraph (A) to additional
participants or participating employers, such plan
shall also be treated as an applicable plan with
respect to such participants or participating
employers.''.
SEC. 303. MORATORIUM ON IMPOSITION OF SHUTDOWN LIABILITY.
(a) In General.--The Pension Benefit Guaranty Corporation shall not
bring any new action against a plan sponsor to enforce subsection (e)
of section 4062 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1362) before January 30, 2016.
(b) Study.--The Comptroller General of the United States shall
study the effectiveness, fairness, and utility of section 4062(e) of
the Employee Retirement Income Security Act (29 U.S.C. 1101 et seq.).
No later than January 30, 2015, the Comptroller General shall submit a
report to the Committee on Health, Education, Labor, and Pensions of
the Senate and the Committee on Education and the Workforce of the
House of Representatives summarizing its findings and including
recommendations for alternative ways to protect retirees and the
Pension Benefit Guaranty Corporation from cessations of operations
while encouraging employers to both continue to offer defined benefit
pension plans and to restructure as may be necessary to ensure the
ongoing viability of the business.
SEC. 304. ALTERNATIVE FUNDING TARGET ATTAINMENT PERCENTAGE DETERMINED
WITHOUT REGARD TO REDUCTION FOR CREDIT BALANCES.
(a) Amendments to ERISA.--Section 206(g) of Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1056(g)) is amended--
(1) in paragraph (5), by striking subparagraph (C); and
(2) in paragraph (9)--
(A) in subparagraph (B)--
(i) by striking the period at the end and
inserting ``; and'';
(ii) by striking ``under subparagraph (A)
by increasing'' and inserting the following:
``under subparagraph (A)--
``(i) by increasing''; and
(iii) by adding at the end the following:
``(ii) without regard to the reduction
under section 303(f)(4)(B).''; and
(B) by striking subparagraphs (C) and (D).
(b) Amendments to 1986 Code.--Section 436 of the Internal Revenue
Code of 1986 is amended--
(1) in subsection (f), by striking paragraph (3); and
(2) in subsection (j)--
(A) in paragraph (2)--
(i) by striking the period at the end and
inserting ``, and''; and
(ii) by striking ``under paragraph (1) by
increasing'' and inserting the following:
``under subparagraph (A)--
``(A) by increasing''; and
(iii) by adding at the end the following:
``(B) without regard to the reduction under section
430(f)(4)(B).''; and
(B) by striking the first and second paragraph (3).
(c) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2014.
SEC. 305. METHOD FOR DETERMINING CHANGES FOR QUARTERLY CONTRIBUTIONS.
(a) Amendment to ERISA.--Section 303(j)(3)(A) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1083(j)(3)(A)) is
amended by inserting ``(determined without regard to the reduction
under subsection (f)(4)(B))'' after ``preceding plan year''.
(b) Amendment to 1986 Code.--Section 430(j)(3) of the Internal
Revenue Code of 1986 is amended by inserting ``(determined without
regard to the reduction under subsection (f)(4)(B))'' after ``preceding
plan year''.
(c) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2014.
SEC. 306. ELECTION TO DISCOUNT CONTRIBUTIONS FROM FINAL DUE DATE.
(a) Amendment to ERISA.--Section 303(j)(2) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1083(j)(2)) is
amended by adding at the end the following: ``For purposes of this
paragraph, a plan sponsor may elect to treat all payments made after
the valuation date as having been made on the last day permissible
under paragraph (1).''.
(b) Amendment to 1986 Code.--Section 430(j)(2) of the Internal
Revenue Code of 1986 is amended by adding at the end the following:
``For purposes of this paragraph, a plan sponsor may elect to treat all
payments made after the valuation date as having been made on the last
day permissible under paragraph (1).''.
(c) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2014.
SEC. 307. SIMPLIFICATION OF ELECTIONS AND NOTICES.
(a) Amendments to ERISA.--
(1) Timeliness of elections.--Section 303 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1083) is
amended by adding at the end the following:
``(m) Timeliness of Elections.--An election required to be made by
the plan sponsor under this section, including an election made under
rules prescribed by the Secretary of the Treasury to implement this
section, shall be deemed to have been timely made if the election is
made on or before the due date specified in subsection (j)(1) or, if
later, the due date of the actuarial report required under section
103(d).''.
(2) Time for providing notice.--Section 101(f)(3)(B) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1021(f)(3)(B)) is amended--
(A) in the heading, by striking ``for small
plans'';
(B) by inserting ``a plan with an adjusted funding
target attainment percentage of more than 80 percent
for the prior year or'' after ``In the case of'';
(C) by striking ``(as such term is used under
section 303(g)(2)(B))''; and
(D) by striking ``upon'' and inserting ``not later
than 2 months after''.
(b) Amendment to 1986 Code.--Section 430 of the Internal Revenue
Code of 1986 is amended by adding at the end the following:
``(m) Timeliness of Elections.--An election required to be made by
the plan sponsor under this section, including an election made under
rules prescribed by the Secretary to implement this section, shall be
deemed to have been timely made if the election is made on or before
the due date specified in subsection (j)(1) or, if later, the due date
of the actuarial report required under section 6059.''.
(c) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2014.
SEC. 308. IMPROVED MULTIEMPLOYER PLAN DISCLOSURE.
(a) Disclosure and Reporting by Multiemployer Plans.--
(1) Plan funding notices.--Section 101(f) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1021(f)) is
amended--
(A) in paragraph (2)(B)--
(i) by striking clause (v);
(ii) by redesignating clauses (vi) through
(x) as clauses (v) through (ix), respectively;
(iii) in clause (vi), as so redesignated--
(I) by striking ``(I) in the case
of'' and inserting ``in the case of'';
(II) by striking ``, or'' and
inserting a comma; and
(III) by striking subclause (II);
and
(iv) by amending clause (vii), as so
redesignated, to read as follows:
``(vii)(I) in the case of a single-employer
plan, a general description of the benefits
under the plan which are eligible to be
guaranteed by the Pension Benefit Guaranty
Corporation, and an explanation of the
limitations on the guarantee and the
circumstances under which such limitations
apply, and
``(II) in the case of a multiemployer plan,
a statement that eligible benefits are
guaranteed by the Pension Benefit Guaranty
Corporation, and a statement of how to obtain
both a general description of the benefits
under the plan which are eligible to be
guaranteed by the Pension Benefit Guaranty
Corporation and an explanation of the
limitations on the guarantee and the
circumstances under which such limitations
apply,''; and
(B) in paragraph (4)(C)--
(i) by striking ``(C) may be provided'' and
inserting ``(C)(i) subject to clause (ii), may
be provided''; and
(ii) by striking the period and inserting
the following:
``(ii) in the case of such a notice provided to the
Pension Benefit Guaranty Corporation, shall be in an
electronic format in such manner prescribed in
regulations of such Corporation.''.
(2) Disclosures by plans regarding status.--
(A) Amendments to erisa.--Section 305(b)(3) of the
Employee Retirement Income Security Act of 1974 (29
U.S.C. 1085(b)(3)) is amended--
(i) in the paragraph heading, by striking
``by plan actuary'' and inserting ``and
report'';
(ii) by amending subparagraph (A) to read
as follows:
``(A) In general.--Not later than the 90th day of
each plan year of a multiemployer plan, the plan
sponsor shall file, in accordance with regulations
prescribed by the ERISA agencies, a report that
contains--
``(i) documentation from the plan actuary
certifying to the ERISA agencies and to the
plan sponsor--
``(I) whether or not the plan is in
endangered status for such plan year
and whether or not the plan is or will
be in critical status for such plan
year or any of the 5 succeeding plan
years,
``(II) in the case of a plan which
is in a funding improvement or
rehabilitation period, whether or not
the plan is making the scheduled
progress in meeting the requirements of
its funding improvement or
rehabilitation plan and, if not, a
summary of the primary reasons the plan
is not making the scheduled progress,
``(III) the funded percentage of
the plan determined as of the first day
of the current plan year and the value
of assets and liabilities used to
calculate such funded percentage,
``(IV) a projection of the funding
standard account on a year-by-year
basis for the current plan year and the
nine succeeding plan years and a
statement of the actuarial assumptions
for such projections, and
``(V)(aa) subject to item (bb), a
projection of the cash flow of the plan
and actuarial assumptions for the
current plan year and six succeeding
plan years, and
``(bb) in the case in which it is
certified that a multiemployer plan is
or will be in endangered or critical
status for a plan year, the projection
of the cash flow of the plan and
actuarial assumptions for the current
year and ten succeeding plan years,
``(ii) as of the last day of the prior plan
year, a good faith determination of--
``(I) the fair market value of the
assets of the plan,
``(II) the number of participants
who are--
``(aa) retired or separated
from service and are receiving
benefits,
``(bb) retired or separated
participants entitled to future
benefits, and
``(cc) active participants
under the plan,
``(III) the total value of all
benefits paid during the prior plan
year,
``(IV) the total value of all
contributions made to the plan during
the prior plan year, and
``(V) the total value of all
investment gains or losses during the
prior plan year,
``(iii) a description of any material
changes during the previous plan year to the
rates at which participants accrue benefits or
the rate at which employers contribute,
``(iv) a copy of any funding improvement
plan, rehabilitation plan, and any update
thereto or modification thereof, that was
adopted under this section prior to the filing
of the report for the current plan year in
accordance with this subparagraph and, if
applicable, after the filing of the report
required by this subparagraph for the prior
plan year,
``(v) in the case of any plan amendment,
scheduled benefit increase or reduction, or
other known event taking effect in the current
plan year and having a material effect on plan
liabilities or assets for the year (as defined
in regulations by the ERISA agencies), an
explanation of the amendment, scheduled
increase or reduction, or event, and a
projection to the end of such plan year of the
effect of the amendment, scheduled increase or
reduction, or event on plan liabilities,
``(vi) in the case of a multiemployer plan
certified to be in critical status for which
the plan sponsor has determined that, based on
reasonable actuarial assumptions and upon
exhaustion of all reasonable measures, the plan
cannot reasonably be expected to emerge from
critical status by the end of the
rehabilitation period, a description of all
reasonable measures, whether or not such
measures were implemented, and a summary of the
consideration of such measures,
``(vii) a good faith statement describing--
``(I) the withdrawal of any
employer during the prior plan year and
the percentage of total contributions
made by that employer during the prior
plan year,
``(II) any material reduction in
total contributions or withdrawal
liability payments of any employers and
the reason for such reduction,
``(III) any significant reduction
in the number of active plan
participants and the reason for such
reduction, and
``(IV) the annual withdrawal
liability payment each employer is
obligated to pay to the plan for the
plan year, whether that amount was
collected by the plan (and if not, the
amount that was collected), and the
remaining years on the employer's
obligation to make withdrawal liability
payments, and
``(viii) such other information as may be
required by the ERISA agencies by
regulation.'';
(iii) by striking subparagraph (C) and
inserting the following:
``(C) Form and manner.--The report required by
subparagraph (A) shall be filed electronically in
accordance with regulations prescribed by the ERISA
agencies.''; and
(iv) in subparagraph (D)--
(I) by redesignating clauses (ii)
and (iii) as clauses (iii) and (iv),
respectively;
(II) by inserting after clause (i)
the following:
``(ii) Plans in endangered or critical
status.--If it is certified under subparagraph
(A) that a multiemployer plan is or will be in
endangered or critical status, the plan sponsor
shall include in the notice under clause (i)--
``(I) a statement describing how a
person may obtain a copy of the plan's
funding improvement or rehabilitation
plan, as appropriate, adopted under
this section and the actuarial and
financial data that demonstrate any
action taken by the plan toward fiscal
improvement,
``(II) a summary of any funding
improvement plan, rehabilitation plan,
and any update thereto or modification
thereof, adopted under this section
prior to the furnishing of such notice,
``(III) a summary of the rules
governing reorganization or insolvency,
including the limitations on benefit
payments, and
``(IV) a general description of the
benefits under the plan which are
eligible to be guaranteed by the
Pension Benefit Guaranty Corporation
and an explanation of the limitations
on the guarantee and the circumstances
under which such limitations apply.'';
(III) in clause (iv), as so
redesignated--
(aa) by striking ``The
Secretary of the Treasury, in
consultation with the
Secretary'' and inserting ``The
ERISA agencies''; and
(bb) by striking ``clause
(ii)'' and inserting ``clauses
(ii) and (iii)''; and
(IV) by adding at the end the
following:
``(E) Designation and coordination.--The ERISA
agencies shall--
``(i) designate one ERISA agency to receive
the report described in subparagraph (A) on
behalf of all the ERISA agencies, which shall
each have full access to such report; and
``(ii) consult with each other and develop
rules, regulations, practices, and forms, which
to the extent appropriate for the efficient
administration of the provisions of this
paragraph are designed to replace duplication
of effort, duplication of reporting,
conflicting or overlapping requirements, and
the burden of compliance with such provisions
by plan administrators and plan sponsors.
``(F) ERISA agencies.--In this paragraph, the term
`ERISA agencies' means the Secretary of Labor, the
Secretary of the Treasury, and the Pension Benefit
Guaranty Corporation.''.
(B) Amendments to 1986 code.--Section 432(b)(3) of
the Internal Revenue Code of 1986 is amended--
(i) in the paragraph heading, by striking
``by plan actuary'' and inserting ``and
report'';
(ii) by amending subparagraph (A) to read
as follows:
``(A) In general.--Not later than the 90th day of
each plan year of a multiemployer plan, the plan
sponsor shall file, in accordance with regulations
prescribed by the ERISA agencies, a report that
contains--
``(i) documentation from the plan actuary
certifying to the ERISA agencies and to the
plan sponsor--
``(I) whether or not the plan is in
endangered status for such plan year
and whether or not the plan is or will
be in critical status for such plan
year or any of the 5 succeeding plan
years,
``(II) in the case of a plan which
is in a funding improvement or
rehabilitation period, whether or not
the plan is making the scheduled
progress in meeting the requirements of
its funding improvement or
rehabilitation plan and, if not, a
summary of the primary reasons the plan
is not making the scheduled progress,
``(III) the funded percentage of
the plan determined as of the first day
of the current plan year and the value
of assets and liabilities used to
calculate such funded percentage,
``(IV) a projection of the funding
standard account on a year-by-year
basis for the current plan year and the
nine succeeding plan years and a
statement of the actuarial assumptions
for such projections, and
``(V)(aa) subject to item (bb), a
projection of the cash flow of the plan
and actuarial assumptions for the
current plan year and six succeeding
plan years, and
``(bb) in the case in which it is
certified that a multiemployer plan is
or will be in endangered or critical
status for a plan year, the projection
of the cash flow of the plan and
actuarial assumptions for the current
year and ten succeeding plan years,
``(ii) as of the last day of the prior plan
year, a good faith determination of--
``(I) the fair market value of the
assets of the plan,
``(II) the number of participants
who are--
``(aa) retired or separated
from service and are receiving
benefits,
``(bb) retired or separated
participants entitled to future
benefits, and
``(cc) active participants
under the plan,
``(III) the total value of all
benefits paid during the prior plan
year,
``(IV) the total value of all
contributions made to the plan during
the prior plan year, and
``(V) the total value of all
investment gains or losses during the
prior plan year,
``(iii) a description of any material
changes during the previous plan year to the
rates at which participants accrue benefits or
the rate at which employers contribute,
``(iv) a copy of any funding improvement
plan, rehabilitation plan, and any update
thereto or modification thereof, that was
adopted under this section prior to the filing
of the report for the current plan year in
accordance with this subparagraph and, if
applicable, after the filing of the report
required by this subparagraph for the prior
plan year,
``(v) in the case of any plan amendment,
scheduled benefit increase or reduction, or
other known event taking effect in the current
plan year and having a material effect on plan
liabilities or assets for the year (as defined
in regulations by the ERISA agencies), an
explanation of the amendment, scheduled
increase or reduction, or event, and a
projection to the end of such plan year of the
effect of the amendment, scheduled increase or
reduction, or event on plan liabilities,
``(vi) in the case of a multiemployer plan
certified to be in critical status for which
the plan sponsor has determined that, based on
reasonable actuarial assumptions and upon
exhaustion of all reasonable measures, the plan
cannot reasonably be expected to emerge from
critical status by the end of the
rehabilitation period, a description of all
reasonable measures, whether or not such
measures were implemented, and a summary of the
consideration of such measures,
``(vii) a good faith statement describing--
``(I) the withdrawal of any
employer during the prior plan year and
the percentage of total contributions
made by that employer during the prior
plan year,
``(II) any material reduction in
total contributions or withdrawal
liability payments of any employers and
the reason for such reduction,
``(III) any significant reduction
in the number of active plan
participants and the reason for such
reduction, and
``(IV) the annual withdrawal
liability payment each employer is
obligated to pay to the plan for the
plan year, whether that amount was
collected by the plan (and if not, the
amount that was collected), and the
remaining years on the employer's
obligation to make withdrawal liability
payments, and
``(viii) such other information as may be
required by the ERISA agencies by
regulation.'';
(iii) by striking subparagraph (C) and
inserting the following:
``(C) Form and manner.--The report required by
subparagraph (A) shall be filed electronically in
accordance with regulations prescribed by the ERISA
agencies.'';
(iv) in subparagraph (D)--
(I) by redesignating clauses (ii)
and (iii) as clauses (iii) and (iv),
respectively;
(II) by inserting after clause (i)
the following:
``(ii) Plans in endangered or critical
status.--If it is certified under subparagraph
(A) that a multiemployer plan is or will be in
endangered or critical status, the plan sponsor
shall include in the notice under clause (i)--
``(I) a statement describing how a
person may obtain a copy of the plan's
funding improvement or rehabilitation
plan, as appropriate, adopted under
this section and the actuarial and
financial data that demonstrate any
action taken by the plan toward fiscal
improvement,
``(II) a summary of any funding
improvement plan, rehabilitation plan,
and any update thereto or modification
thereof, adopted under this section
prior to the furnishing of such notice,
``(III) a summary of the rules
governing reorganization or insolvency,
including the limitations on benefit
payments, and
``(IV) a general description of the
benefits under the plan which are
eligible to be guaranteed by the
Pension Benefit Guaranty Corporation
and an explanation of the limitations
on the guarantee and the circumstances
under which such limitations apply.'';
and
(III) in clause (iv), as so
redesignated--
(aa) by striking ``The
Secretary, in consultation with
the Secretary of Labor'' and
inserting ``The ERISA
agencies''; and
(bb) by striking ``clause
(ii)'' and inserting ``clauses
(ii) and (iii)''; and
(v) by adding at the end the following:
``(E) Designation and coordination.--The ERISA
agencies shall--
``(i) designate one ERISA agency to receive
the report described in subparagraph (A) on
behalf of all the ERISA agencies, which shall
each have full access to such report; and
``(ii) consult with each other and develop
rules, regulations, practices, and forms, which
to the extent appropriate for the efficient
administration of the provisions of this
paragraph are designed to replace duplication
of effort, duplication of reporting,
conflicting or overlapping requirements, and
the burden of compliance with such provisions
by plan administrators and plan sponsors.
``(F) ERISA agencies.--In this paragraph, the term
`ERISA agencies' means the Secretary of Labor, the
Secretary of the Treasury, and the Pension Benefit
Guaranty Corporation.''.
(C) Disclosures by plans regarding status.--Section
4003 of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1303) is amended--
(i) in the section heading, by inserting
``; multiemployer plan information'' after
``actions''; and
(ii) by adding at the end the following:
``(g) The corporation is authorized to require such information as
it deems necessary to investigate or review any facts, conditions, or
other matters related to the actuarial certification and report by
multiemployer plans under section 305(b)(3)(A), or to obtain such
information as any duly authorized committee or subcommittee of the
Congress may request with respect to such plans. The preceding sentence
shall be considered a statute described in section 552(b)(3) of title
5, United States Code, and the information received pursuant to such
sentence shall be exempt from disclosure under such section 552(b).''.
(3) Civil enforcement.--
(A) In general.--Section 502(c) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1132)
is amended--
(i) in paragraph (7)--
(I) by striking ``(7) The
Secretary'' and inserting ``(7)(A) The
Secretary''; and
(II) by adding at the end the
following:
``(B) The Secretary may assess a civil penalty against a plan
administrator (or plan sponsor with respect to the notice of endangered
or critical status) of up to $110 per day from the date of the plan
administrator's or sponsor's failure or refusal to provide the relevant
notices under section 101(f) or section 305(b)(3)(D) to a recipient
other than the Secretary or the Pension Benefit Guaranty Corporation.
For purposes of this paragraph, each violation with respect to any
single recipient shall be treated as a separate violation.'';
(ii) by redesignating the second paragraph
(10) (regarding coordinating enforcement under
section 502(c) of such Act with enforcement
under section 1144(c)(8) of the Social Security
Act) as paragraph (12); and
(iii) by inserting after paragraph (10)
(regarding enforcement authority relating to
use of genetic information) the following:
``(11)(A) The Secretary may assess a civil penalty against
any plan sponsor of up to $1,100 per day from the date of the
plan sponsor's failure to file with the Secretary the notice
required under section 305(b)(3)(D) or with the Pension Benefit
Guaranty Corporation the notice required under section 101(f).
``(B) The Secretary may assess a civil penalty against any
plan sponsor of up to $1,100 per day from the date of the plan
sponsor's failure to file with the ERISA agency designated in
accordance with subparagraph (E) of section 305(b)(3) the
report under subparagraph (A) of such section.''.
(B) Conforming amendment.--Section 502(a)(6) of
such Act is amended by striking ``or (9)'' and
inserting ``(9), (10), or (11)''.
(b) Coordination With Respect to Multiemployer Plans.--
(1) In general.--Subtitle A of title III of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1201 et seq.)
is amended by adding at the end the following:
``SEC. 3005. DATABASE OF MULTIEMPLOYER PLAN INFORMATION.
``(a) In General.--The Secretary of Labor, the Secretary of the
Treasury, and the Pension Benefit Guaranty Corporation shall jointly
establish an electronic database that contains the following
information:
``(1) Each defined benefit plan funding notice submitted to
the Pension Benefit Guaranty Corporation by a multiemployer
plan under section 101(f).
``(2) Each report submitted by a multiemployer plan under
section 305(b)(3)(A).
``(3) Each notice submitted to the Secretary of Labor and
the Pension Benefit Guaranty Corporation by a multiemployer
plan under section 305(b)(3)(D).
``(b) Shared Access to Database.--Subject to the agreement
described in subsection (c), the Secretary of Labor, the Secretary of
the Treasury, and the Pension Benefit Guaranty Corporation shall have
full access to the data in the database established under subsection
(a). To avoid unnecessary expense and duplication of functions among
the agencies, the Secretary of Labor, the Secretary of the Treasury,
and the Pension Benefit Guaranty Corporation may make such arrangements
and agreements for cooperation or mutual assistance with respect to
access to and utilization of the data in the database.
``(c) Shared Cost of Database.--The Secretary of Labor, the
Secretary of the Treasury, and the Pension Benefit Guaranty Corporation
shall execute a cost sharing agreement to equitably allocate the
design, implementation, and maintenance costs of the database
established under subsection (a).
``(d) Exemption.--The information contained in the report described
under subsection (a)(2) shall be exempt from disclosure under section
552(b) of title 5, United States Code. For purposes of such section 552
of title 5, United States Code, this subsection shall be considered a
statute described in subsection (b)(3) of such section 552.''.
(2) Clerical amendment.--The table of sections for subtitle
A of title III of the Employee Retirement Income Security Act
of 1974 is amended by adding at the end the following new item:
``3005. Database of multiemployer plan information.''.
(c) Applicability.--This section (and the amendments made by this
section) shall apply to plan years beginning after the date that is 1
year after the date of enactment of this Act.
Subtitle B--Improvements to the Pension Insurance Program
SEC. 311. MODIFICATIONS OF TECHNICAL CHANGES MADE BY THE PENSION
PROTECTION ACT OF 2006 TO TERMINATION LIABILITY.
(a) In General.--Section 4062(c) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1362(c)) is amended by striking
paragraphs (1) and (2) and inserting the following:
``(1) the aggregate unpaid minimum required contributions
(within the meaning of section 4971(c)(4) of the Internal
Revenue Code of 1986) of the plan (if any) for the plan year in
which the termination date occurs and for all preceding plan
years, including, for purposes of this paragraph, the amount of
any increase in such aggregate unpaid minimum required
contributions that would result if--
``(A) all pending applications for waivers of the
minimum funding standard under section 302(c) of this
Act and section 412(c) of such Code with respect to
such plan were denied, and
``(B) no additional contributions (other than those
already made by the termination date) were made for the
plan year in which the termination date occurs or for
any previous plan year, and
``(2) the unamortized portion (if any) of any amounts
waived for the plan under section 302(c) of this Act and
section 412(c) of such Code for--
``(A) the plan year in which the termination date
occurs, and
``(B) all preceding plan years,''.
(b) Effective Date.--The amendments made by this section shall take
effect as if included in section 107 of the Pension Protection Act of
2006 (Public Law 109-280; 120 Stat. 816).
SEC. 312. PAYMENT OF LUMP SUM DISTRIBUTIONS IN BANKRUPTCY.
(a) Amendments to ERISA.--The second sentence of section
206(g)(3)(B) of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1056(g)(3)) is amended to read as follows: ``The preceding
sentence shall not apply on or after the date on which the enrolled
actuary of the plan certifies that the adjusted funding target
attainment percentage of such plan (determined by not taking into
account any adjustment of segment rates under section 303(h)(2)(C)(iv))
is not less than 100 percent.''.
(b) Amendments to 1986 Code.--The second sentence of section
436(d)(2) of the Internal Revenue Code of 1986 is amended to read as
follows: ``The preceding sentence shall not apply on or after the date
on which the enrolled actuary of the plan certifies that the adjusted
funding target attainment percentage of such plan (determined by not
taking into account any adjustment of segment rates under section
430(h)(2)(C)(iv)) is not less than 100 percent.''.
(c) Effective Date.--The amendments made by this section shall take
effect as of July 6, 2012.
SEC. 313. TRUSTEESHIP CLARIFICATIONS.
(a) Appointment of Trustees in Plan Termination Instituted by
PBGC.--
(1) In general.--Subsections (a) and (b) of section 4002
(29 U.S.C. 1342) are amended to read as follows:
``(a) Authority To Institute Proceedings To Terminate a Plan.--
``(1) In general.--The corporation may institute
proceedings under this section to terminate a plan whenever it
determines that the plan must be terminated in order to protect
the interests of the participants or to avoid any unreasonable
deterioration of the financial condition of the plan or any
unreasonable increase in the liability of the corporation, as
shown by one or more of the following conditions:
``(A) The plan has not met the minimum funding
standard required under section 412 of the Internal
Revenue Code of 1986, or has been notified by the
Secretary of the Treasury that a notice of deficiency
under section 6212 of such Code has been mailed with
respect to the tax imposed under section 4971(a) of
such Code.
``(B) The plan will be unable to pay benefits when
due.
``(C) The reportable event described in section
4043(c)(7) has occurred.
``(D) The possible long-run loss of the corporation
with respect to the plan may reasonably be expected to
increase unreasonably if the plan is not terminated.
``(2) Requirement.--The corporation shall, as soon as
practicable, institute proceedings under this section to
terminate a single-employer plan whenever the corporation
determines that the plan does not have assets available to pay
benefits which are currently due under the terms of the plan.
Notwithstanding any other provision of this subchapter, the
corporation shall, to the extent practicable, pool assets of
terminated plans for purposes of administration, investment,
payment of liabilities of all such terminated plans, and such
other purposes as the corporation determines to be appropriate
in the administration of this title.
``(b) Appointment of the Corporation To Administer Plan.--
``(1) In general.--Whenever the corporation makes a
determination under subsection (a) with respect to a plan or is
required under subsection (a) to institute proceedings under
this section, the corporation may, upon notice to the plan,
apply to the appropriate United States district court to
appoint the corporation as the person to administer the plan
with respect to which the determination is made pending the
issuance of a decree under subsection (c) ordering the
termination of the plan. If, within 3 business days after the
filing of an application under this subsection (or such other
period as the court may order), the administrator of the plan
consents to the appointment of the corporation to administer
the plan, or fails to show why the corporation should not be so
appointed, the court may grant the application and appoint the
corporation to administer the plan in accordance with its terms
until the corporation determines that the plan should be
terminated or that termination is unnecessary.
``(2) Appointment.--Notwithstanding any other provision of
this title--
``(A) upon the petition of a plan administrator or
the corporation, the appropriate United States district
court may appoint the corporation to administer the
plan in accordance with the provisions of this section
if the interests of the plan participants would be
better served by such appointment, and
``(B) upon the petition of the corporation, the
appropriate United States district court shall appoint
a trustee proposed by the corporation for a
multiemployer plan which is in reorganization to which
section 4041A(d) applies, unless such appointment would
be adverse to the interests of the plan participants
and beneficiaries in the aggregate.
``(3) Agreement to appointment.--The corporation and plan
administrator may agree to the appointment of the corporation
to administer the plan without proceeding in accordance with
the requirements of paragraphs (1) and (2).''.
(2) Conforming amendments.--
(A) Subsection (c) of such section 4042 is
amended--
(i) by striking ``(c)(1)'' and all that
follows through the end of paragraph (1) and
inserting the following:
``(c) Decree Enforcing Determination That Plan Must Be
Terminated.--
``(1) Court decree.--
``(A) Application.--If the corporation is required
under subsection (a) to commence proceedings under this
section with respect to a plan or, after issuing a
notice under this section to a plan administrator, has
determined that the plan should be terminated, the
corporation may, upon notice to the plan administrator,
apply to the appropriate United States district court
for a decree enforcing the corporation's determination
that the plan be terminated.
``(B) Decree.--
``(i) In general.--The district court shall
issue the decree under subparagraph (A) unless
such court finds, upon review of the
administrative record of the corporation's
determination under subsection (a), that such
determination was arbitrary, capricious, an
abuse of discretion, or otherwise not in
accordance with law.
``(ii) Effect of decree.--Upon granting a
decree for which the corporation has applied
under this subsection, the court shall
authorize the corporation if appointed under
subsection (b) (or appoint the corporation if
such corporation has not been appointed under
such subsection and authorize the corporation)
to terminate the plan in accordance with the
provisions of this subtitle.
``(C) Waiver of application.--If the corporation
and the plan administrator agree that a plan should be
terminated and agree to the appointment of the
corporation to carry out the termination of the plan
without proceeding in accordance with the requirements
of this subsection (other than this subparagraph), the
corporation shall have the power described in
subsection (d)(1) and shall be subject to the duties
described in subsection (d)(3) and any other duties
imposed on the corporation under any other provision of
law or by agreement between the corporation and the
plan administrator.''; and
(ii) in paragraph (2), by striking ``(2) In
the case of'' and inserting ``(2) Providing of
information.--In the case of''.
(B) Subsection (d) of such section 4042 is
amended--
(i) in paragraph (1)(A)--
(I) by striking ``A trustee
appointed under subsection (b)'' and
inserting ``If the corporation is
appointed to administer a plan under
subsection (b), the corporation'';
(II) in clause (ii), by striking
``himself as trustee'' and inserting
``the corporation'';
(III) in clause (iii), by striking
``he'' and inserting ``the
corporation'';
(IV) in clause (iv), by striking
``his appointment'' and inserting ``the
appointment of the corporation'';
(V) in clause (vi), by striking
``he'' and inserting ``the
corporation'';
(VI) in clause (vii), by striking
``trustee'' and inserting
``corporation''; and
(VII) by striking the flush
language after clause (vii) and
inserting the following:
``If the court to which application is made under
subsection (c) dismisses the application with
prejudice, or if the corporation fails to apply for a
decree under subsection (c), within 30 days after the
date on which the corporation is appointed under
subsection (b), the corporation shall transfer all
assets and records of the plan held by such corporation
to the plan administrator not later than 3 business
days after such dismissal or the expiration of such 30-
day period, and shall not be liable to the plan or any
other person for the acts of the corporation in
administering the plan except for willful misconduct or
gross negligence. The 30-day period described in the
preceding sentence may be extended as provided by
agreement between the plan administrator and the
corporation or by court order.'';
(ii) in paragraph (1)(B)--
(I) in the matter preceding clause
(i), by striking ``trustee'' and
inserting ``corporation'';
(II) by striking clauses (iii) and
(v);
(III) by redesignating clause (iv)
as clause (iii); and
(IV) by redesignating clauses (vi)
through (viii) as clauses (iv) through
(vi), respectively;
(iii) in paragraph (2)--
(I) in the matter preceding
subparagraph (A) by striking ``his
appointment, the trustee'' and
inserting ``the appointment of the
corporation to administer the plan, the
corporation''; and
(II) in subparagraph (D) by
striking ``section''; and
(iv) by striking paragraph (3) and
inserting the following:
``(3) Except to the extent inconsistent with the provisions
of this Act, the corporation, as appointed under this section,
shall be subject to the same duties as those of a trustee under
section 704 of title 11, United States Code, and shall be, with
respect to the plan, a fiduciary within the meaning of section
3(21) (except to the extent that the provisions of this title
are inconsistent with the requirements applicable under part 4
of subtitle B of title I). Notwithstanding any references in
this section to administering a plan, the corporation shall not
be considered a plan administrator within the meaning of
section 3 and shall not be subject to the duties of a plan
administrator under title I, including the duty to file reports
on behalf of the plan.
``(4) When appointed under subsection (b) to administer a
plan or granted a decree to terminate a plan under subsection
(c), the corporation shall, within 30 days of the receipt of a
written request from any participant or beneficiary of the plan
(or as soon as practicable thereafter), furnish a copy of the
plan document, summary plan description, and other instruments
under which the plan is established or operated that relate to
the participant's or beneficiary's benefit under the plan. The
corporation may charge a reasonable fee to cover the cost of
furnishing complete copies.''.
(C) Subsection (f) of such section 4042 is amended
to read as follows:
``(f) Upon the filing of an application for the appointment of the
corporation to administer a plan or the issuance of a decree under this
section, the court to which an application is made shall have exclusive
jurisdiction of the plan involved and property of the plan, wherever
located, with the powers, to the extent consistent with the purposes of
this section, of a court of the United States having jurisdiction over
cases under chapter 11 of title 11, United States Code. Pending an
adjudication under subsection (c), such court shall stay, and upon
appointment of the corporation to carry out the termination of the plan
under this section, such court shall continue the stay of any pending
mortgage foreclosure, equity receivership, or other proceeding to
reorganize, conserve, or liquidate the plan or the property of the plan
and any other suit against any receiver, conservator, or trustee of the
plan or property of the plan. Pending such adjudication and upon the
appointment of the corporation to carry out the termination of the
plan, the court may stay any proceeding to enforce a lien against
property of the plan or any other suit against the plan.''.
(D) Such section 4042 is amended by striking
subsection (h).
(b) Other Conforming and Technical Amendments.--
(1) Section 4002(h)(1) of such Act (29 U.S.C. 1302(h)(1))
is amended--
(A) in the first sentence--
(i) in subparagraph (A), by striking ``the
appointment of trustees in termination
proceedings'' and inserting ``the appointment
of the corporation to administer or carry out a
termination of a plan under section 4042''; and
(ii) in subparagraph (C), by striking
``under a trustee'' and inserting ``under the
corporation''; and
(B) in the second sentence--
(i) by striking ``recommend persons for
appointment as trustees in termination
proceedings,'';
(ii) by striking the comma after ``funds'';
and
(iii) by striking ``under a trustee'' and
inserting ``under the corporation''.
(2) Section 4003 of such Act (29 U.S.C. 1303) is amended--
(A) in subsection (e)(6)(B), by amending clause
(ii) to read as follows:
``(ii) If the corporation brings the action on behalf of a
plan that the corporation was appointed to administer or
terminate under section 4042, the applicable date specified in
this subparagraph is the date on which the corporation was so
appointed if such date is later than the date described in
clause (i).''; and
(B) in subsection (f)(4), by striking ``the
corporation in its capacity as a trustee under section
4042 or 4049'' and inserting ``the corporation in its
capacity as a trustee under section 4049 or in its
capacity in administering a plan pursuant to its
appointment under section 4042(b) or carrying out the
termination of a plan pursuant to its appointment under
section 4042(c)''.
(3) Section 4004(b) of such Act (29 U.S.C. 1304(b)) is
amended--
(A) in paragraph (1), by striking ``pension plans
trusteed by the corporation'' and inserting ``pension
plans for which the corporation has been appointed
under section 4042 to carry out their termination'';
and
(B) in paragraph (2), by striking ``plans trusteed
by the corporation'' and inserting ``plans for which
the corporation has been appointed under section 4042
to carry out their termination''.
(4) Section 4005(b)(1)(B) of such Act (29 U.S.C.
1305(b)(1)(B)) is amended by striking ``a plan administered
under section 4042 by a trustee'' and inserting ``a plan that
the corporation has been appointed to terminate under section
4042''.
(5) Section 4007(a) of such Act (29 U.S.C. 1307(a)) is
amended by striking ``a trustee'' and inserting ``the
corporation''.
(6) Section 4044 of such Act (29 U.S.C. 1344) is amended--
(A) in subsection (c), by striking ``the date a
trustee is appointed under section 4042(b)'' and
inserting ``the date the corporation is appointed under
section 4042(b) to administer the plan''; and
(B) in subsection (f)--
(i) in paragraph (2)(C)(ii), by striking
``the trustee appointed under section 4042(b)
or (c)'' and inserting ``the corporation, for
the account of the plan''; and
(ii) in paragraph (3), by amending
subparagraph (B) to read as follows:
``(B) the amount of any liability to the
corporation under section 4062(b) or (c).''.
(7) Section 4045 of such Act (29 U.S.C. 1345) is amended by
striking ``trustee'' each place such term appears in
subsections (a) and (c) and inserting ``corporation''.
(8)(A) Section 4046 of such Act (29 U.S.C. 1346) is
repealed.
(B) The table of sections for subtitle C of title IV of
such Act is amended by striking the item relating to section
4046.
(9) Section 4048 of such Act (29 U.S.C. 1348) is amended--
(A) in subsection (a)(4), by striking ``(or the
trustee)''; and
(B) in subsection (b)(2), by striking ``(or the
trustee appointed under section 4042(b)(2), if any)''.
(10) Section 4050(a)(2) of such Act (29 U.S.C. 1350(a)(2))
is amended by striking ``to the corporation as trustee, and
shall be held with assets of terminated plans for which the
corporation is trustee under section 4042'' and inserting ``to
the corporation, as appointed under section 4042 to carry out
the termination of a plan, and shall be held with assets of
terminated plans that the corporation has been appointed to
terminate under section 4042''.
(11) Section 4062 of such Act (29 U.S.C. 1362), as amended
by sections 303 and 321, is amended--
(A) in subsection (a), by striking paragraphs (1)
and (2) and inserting the following:
``(1) liability to the corporation, for the account of the
corporation, to the extent provided in subsection (b), and
``(2) liability to the corporation, for the account of the
plan, to the extent provided in subsection (c).'';
(B) in the heading of subsection (b), by inserting
``for Its Own Account'' after ``Corporation''; and
(C) in subsection (c)--
(i) in the heading, by striking ``Section
4042 Trustee'' and inserting ``the Corporation
for the Account of the Plan''; and
(ii) in the matter preceding paragraph (1),
by striking ``the trustee appointed under
subsection (b) or (c) of section 4042'' and
inserting ``the corporation, for the account of
the plan, as appointed under section 4042 to
carry out the termination of the plan''.
SEC. 314. RECORDKEEPING FOR TERMINATING PLANS.
(a) Single-Employer Plan Benefits Guaranteed.--Section 4022 of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1322) is
amended by adding at the end the following:
``(i) Recordkeeping.--The Corporation may issue regulations to
require plan sponsors or plan administrators to maintain records
necessary to enable the to determine benefits as of the termination
date. Such regulations may require plan sponsors or plan administrators
to certify to the corporation that such records are being
maintained.''.
(b) Allocation of Assets.--Section 4044 of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1344) is amended by adding at
the end the following:
``(g) Recordkeeping.--The Corporation may issue regulations to
require plan sponsors or plan administrators to maintain records
necessary to enable the Corporation to determine benefits as of the
termination date. Such regulations may require plan sponsors or plan
administrators to certify to the corporation that such records are
being maintained.''.
SEC. 315. TERMINATION DATE IN BANKRUPTCY.
Sections 4022(g) and 4044(e) of the Employee Retirement Income
Security Act of 1974, as added by section 404 of the Pension Protection
Act of 2006 (Public Law 109-280; 120 Stat. 928), are repealed as of
December 31, 2014, and shall not apply with respect 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 after
such date.
TITLE IV--OTHER SYSTEMIC REFORMS
SEC. 401. PLAN AUDIT QUALITY IMPROVEMENT.
(a) Annual Reports.--Section 103(a)(3) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1023(a)(3)) is amended--
(1) in subparagraph (A), by striking ``in conformity with
generally accepted accounting principles applied on a basis
consistent with that of the preceding year. Such examination
shall be conducted in accordance with generally accepted
auditing standards, and shall involve such tests of the books
and records of the plan as are considered necessary by the
independent qualified public accountant.'' and inserting ``in
conformity with generally accepted accounting principles, as
superseded or modified by the Secretary in regulations, applied
on a basis consistent with that of the preceding year. Such
examination shall be conducted in accordance with generally
accepted auditing standards, except as superseded or modified
by the Secretary in regulations, and shall involve such tests
of the books and records of the plan as are considered
necessary by the independent qualified public accountant.'';
and
(2) by adding at the end the following:
``(E) Persons described in subparagraphs (i)
through (iii) of subparagraph (D) shall be subject to
such additional standards regarding conflicts of
interest, qualifications, and direct reporting of
certain events such as fraud and other irregularities
as the Secretary may prescribe in regulations.''.
(b) Civil Enforcement.--Section 502(c)(2) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1132(c)(2)) is
amended by adding at the end the following new sentence: ``If the
Secretary rejects an annual report in whole or in part due to the
failure to comply with a requirement of section 103 imposed on an
accountant, actuary, or other person, the Secretary may assess all or
part of the civil penalty against such person. The Secretary may
require remediation in place of assessing all or part of a penalty.''.
(c) Debarment for Deficient Audits or for Failing To Meet
Qualification Standards.--
(1) In general.--Part 5 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1131
et seq.) is amended by adding at the end the following:
``SEC. 522. DEBARMENT FOR DEFICIENT AUDITS OR FOR FAILING TO MEET
QUALIFICATION STANDARDS.
``(a) In General.--If the Secretary finds, after notice and
opportunity for a hearing, that an accountant or accounting firm has
engaged in any act or practice, or failed to act, in violation of
section 103 relating to the preparation and issuance of audit reports,
or with professional standards, the Secretary may issue an order to bar
an accountant or accounting firm (or division or component of such
firm), on a temporary or permanent basis, from directly or indirectly
engaging in specified activities relating to performing or supervising
plan audits required under section 103.
``(b) Hearings.--The subject of a debarment order may request a
hearing and file an answer not later than 30 days after the date of
service of the notice of the debarment order, in accordance with
regulations prescribed by the Secretary. Failure to request a hearing
within such 30-day period shall constitute a waiver of the right to
appear and contest the facts alleged in the debarment order and an
admission of the facts alleged in the order for purposes of any related
proceedings under this part. Such order shall then become a final
agency action under section 704 of title 5, United States Code.
``(c) Modification or Termination of Orders.--The Secretary may
modify or terminate an order issued under this section, upon the
request of the subject of the order and pursuant to procedures
established by the Secretary, if the Secretary determines that such
modification or termination is in the interest of plan participants and
beneficiaries.
``(d) Publicity of Orders.--The Secretary shall make all final
orders under this section (including modified orders) public and shall
notify applicable State regulatory organizations upon the issuance of
such final orders (including modified orders).
``(e) Jurisdiction.--Lawsuits by the subject of an order to review
the final order of the Secretary may be brought only in the district
court of the United States for the district where the subject of the
order has its principal office or in the United States District Court
for the District of Columbia.
``(f) Regulations.--The Secretary may promulgate such regulations
or other guidance as may be necessary or appropriate to carry out this
section.''.
(2) Clerical amendment.--The table of sections for part 5
of subtitle B of title I of the Employee Retirement Income
Security Act of 1974 is amended by adding at the end the
following new item:
``522. Debarment for deficient audits or for failing to meet
qualification standards.''.
(d) Exception.--
(1) In general.--Section 103(a)(3)(C) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1023(a)(3)(C)) is amended by striking ``if such statements are
certified by the bank, similar institution, or insurance
carrier as accurate and are made part of the annual report.''
and inserting ``except to the extent required under regulations
promulgated by the Secretary.''.
(2) Effective date.--The amendment made by paragraph (1)
shall not become effective until the Secretary has promulgated
final regulations with respect to such amendment.
SEC. 402. SPECIAL RULES RELATING TO TREATMENT OF QUALIFIED DOMESTIC
RELATIONS ORDERS.
(a) Preservation of Assets.--
(1) Amendments to erisa.--Section 206(d)(3) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1056(d)(3))
is amended--
(A) by redesignating subparagraph (N) as
subparagraph (O); and
(B) by inserting after subparagraph (M) the
following:
``(N) Preservation of assets.--
``(i) In general.--If a spouse or former
spouse of a participant--
``(I) notifies a plan in writing
that--
``(aa) an action is pending
pursuant to a State domestic
relations law (including a
community property law), and
``(bb) all or a portion of
the benefits payable with
respect to the participant
under the plan are a subject of
such action, and
``(II) includes with the notice
evidence of the pendency of the action,
the plan administrator shall, during the
segregation period, separately account for 50
percent of such benefits. Any amounts so
separately accounted for may not be distributed
by the plan during the segregation period.
``(ii) Segregation period.--
``(I) In general.--For purposes of
clause (i), the term `segregation
period' means the period--
``(aa) beginning on the
date of receipt by the plan of
the notice under clause (i),
and
``(bb) ending on the
earlier of--
``(AA) 90 days
after the date of
receipt of such notice,
or
``(BB) the date of
receipt of a domestic
relations order with
respect to the
participant and the
prospective alternate
payee or the date on
which the action is no
longer pending.
``(II) Extension of segregation
period.--The segregation period shall
be extended for 1 or more additional
periods described in subclause (I) upon
notice by the spouse or former spouse
that the action described in clause
(i)(I)(aa) is still pending as of the
close of any prior segregation
period.''.
(2) Amendments to 1986 code.--Section 414(p) of the
Internal Revenue Code of 1986 is amended--
(A) by redesignating paragraph (13) as paragraph
(14); and
(B) by inserting after paragraph (12) the
following:
``(13) Preservation of assets.--
``(A) In general.--If a spouse or former spouse of
a participant--
``(i) notifies a plan in writing that--
``(I) an action is pending pursuant
to a State domestic relations law
(including a community property law),
and
``(II) all or a portion of the
benefits payable with respect to the
participant under the plan are a
subject of such action, and
``(ii) includes with the notice evidence of
the pendency of the action,
the plan administrator shall, during the segregation
period, separately account for 50 percent of such
benefits. Any amounts so separately accounted for may
not be distributed by the plan during the segregation
period.''.
``(B) Segregation period.--
``(i) In general.--For purposes of
subparagraph (A), the term `segregation period'
means the period--
``(I) beginning on the date of
receipt by the plan of the notice under
clause (i), and
``(II) ending on the earlier of--
``(aa) 90 days after the
date of receipt of such notice,
or
``(bb) the date of receipt
of a domestic relations order
with respect to the participant
and the prospective alternate
payee or the date on which the
action is no longer pending.
``(ii) Extension of segregation period.--
The segregation period shall be extended for 1
or more additional periods described in clause
(i) upon notice by the spouse or former spouse
that the action described in subparagraph
(A)(i)(I) is still pending as of the close of
any prior segregation period.''.
(b) Penalty for Failure To Provide Information Regarding Alternate
Payees.--
(1) In general.--Section 502(c), as amended by section 312,
of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1132(c)) is amended--
(A) by redesignating paragraphs (8), (9), (10),
(11), and (12) as paragraphs (9), (10), (11), (12), and
(13) respectively; and
(B) by inserting after paragraph (7) the following:
``(8) Failure to provide information regarding alternate
payees.--The plan administrator shall provide information
regarding the benefit to prospective alternative payees under a
domestic relations order under section 206(d)(3) or any
representative of a prospective alternative payee in connection
with such an order. The Secretary may assess a civil penalty
against any plan administrator of up to $100 a day from the
date of the plan administrator's failure or refusal to provide
such information.''.
(2) Conforming amendment.--Section 502(a)(6) of such Act
(29 U.S.C. 1132(a)(6)), as so amended, is amended by striking
``or (11)'' and inserting ``(11), or (12)''.
(c) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2014.
SEC. 403. CORRECTION TO BONDING REQUIREMENT.
Section 412(a)(3)(D) of the Employee Retirement Income Security Act
of 1974 (29 U.S.C. 1112(a)(3)(D)) is amended by striking ``Paragraph
(2)'' and inserting ``This paragraph''.
SEC. 404. RETALIATION PROTECTIONS.
Section 510 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1140) is amended by inserting ``, has filed or made any oral
or written complaint (including to a fiduciary, an employer, or the
Secretary),'' after ``given information''.
<all>