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Billno should always have and extension i.e. h1.ih

To provide special minimum funding requirements for certain pension plans maintained pursuant to collective bargaining agreements. (Introduced in Senate)

S 119 IS

108th CONGRESS

1st Session

S. 119

To provide special minimum funding requirements for certain pension plans maintained pursuant to collective bargaining agreements.

IN THE SENATE OF THE UNITED STATES

January 9, 2003

Mr. SANTORUM (for himself, Mr. SPECTER, Mr. WARNER, and Mrs. DOLE) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To provide special minimum funding requirements for certain pension plans maintained pursuant to collective bargaining agreements.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. MODIFICATION OF FUNDING REQUIREMENTS FOR CERTAIN PLANS.

(a) FUNDING RULES FOR CERTAIN PLANS-

(1) IN GENERAL- Notwithstanding any other provision of the Internal Revenue Code of 1986 or the Employee Retirement Income Security Act of 1974, the minimum funding rules under paragraph (2) shall apply for any plan year beginning after December 31, 2002, in the case of a defined benefit plan which--

(A) was established by an air carrier which was granted a conditional loan guarantee by the Air Transport Stabilization Board on July 10, 2002, and which filed for protection under chapter 11 of title 11, United States Code, on August 11, 2002, and

(B) is maintained for the benefit of such carrier's employees pursuant to a collective bargaining agreement.

(2) SPECIAL FUNDING RULE-

(A) IN GENERAL- In the case of a plan described in paragraph (1), the minimum funding requirements under this paragraph shall be the requirements set forth in Treasury Regulation section 1.412(c)(1)-3 (as in effect on the date of the enactment of this section).

(B) RULES OF SPECIAL APPLICATION- In applying the requirements of Treasury Regulation section 1.412(c)(1)-3 for purposes of paragraph (1)--

(i) the plan shall be treated as having met the requirements of Treasury Regulation section 1.412(c)(1)-3(a)(2),

(ii) the payment schedules shall be determined--

(I) by using the maximum amortization period permitted under section 1.412(c)(1)-3, and

(II) on the basis of the actuarial valuation of the accrued liability and the current liability of the plan as of January 1, 2003, less the actuarial value of the plan assets on that date,

(iii) the payments under a restoration payment schedule shall be made in level amounts over the payment period, and

(iv) the actuarial value of assets shall be the fair market value of such assets as of January 1, 2003, with prospective investment returns in excess of or less than the assumed return phased in over 5 years.

(b) EFFECTIVE DATE- The amendments made by this section shall apply to plan years beginning after December 31, 2002.

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