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(1) in paragraphs (1), (2)(A)(iii), (2)(B), (4)(B), and (5)(A)(ii) of subsection (b), by striking "through 1987" and inserting "through 1989"; (2) in paragraph (5)(A) of subsection (b) (in the matter preceding clause (i)), by striking "October 1, 1987" and inserting "October 1, 1989"; and (3) in paragraphs (1) and (2) of subsection (c), by striking "through 1987" and inserting "through 1989". 42 USC 674 note. (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall become effective October 1, 1987. SEC. 9133. MOTHER/INFANT FOSTER CARE.

42 USC 675.

42 USC 602.

(a) IN GENERAL.—Section 475(4) of the Social Security Act is amended— (1) by inserting "(A)" after "(4)"; and (2) by adding at the end the following new subparagraph: "(B) In cases where— "(i) a child placed in a foster family home or child-care institution is the parent of a son or daughter who is in the same home or institution, and "(ii) payments described in subparagraph (A) are being made under this part with respect to such child, the foster care maintenance payments made with respect to such child as otherwise determined under subparagraph (A) shall also include such amounts as may be necessary to cover the cost of the items described in that subparagraph with respect to such son or daughter.", (b) CONFORMING AMENDMENTS RELATING TO ELIGIBILITY UNDER OTHER PROGRAMS.—(1) Section 402(a)(24) of such Act is amended by

striking "if an individual is receiving benefits under title XVI, then, for the period for which such benefits are received," and inserting the following: "if an individual is receiving benefits under title XVI or his costs in a foster family home or child-care institution are covered by the foster care maintenance payments being made to his or her minor parent as provided in section 475(4)(B), then, for the period for which such benefits are received or such costs are so covered ". 42 USC 672. (2) Section 472(h) of such Act is amended by adding at the end the following new sentence: "For purposes of the preceding sentence, a child whose costs in a foster family home or child-care institution are covered by the foster care maintenance payments being made with respect to his or her minor parent, as provided in section 475(4)(B), shall be considered a child with respect to whom foster care maintenance payments are made under this section.". 42 USC 673. (3)(A) Section 473(a)(2)(A) of such Act is amended— (i) by striking "or" at the end of clause (i); (ii) by adding "or" at the end of clause (ii); and 4 (iii) by adding after clause (ii) the following new clause: "(iii) is a child whose costs in a foster family home or child; % J: care institution are covered by the foster care maintenance payments being made with respect to his or her minor parent as provided in section 475(4)(B),". (B) Section 473(a)(2)(B)(iii) of such Act is amended by inserting "or (A)(iii)" after "(A)(ii)". (4) Section 473(b) of such Act is amended by adding at the end the following new sentence: "For purposes of the preceding sentence, a child whose costs in a foster family home or child-care institution

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are covered by the foster care maintenance payments being made with respect to his or her minor parent, as provided in section 475(4)(B), shall be considered a child with respect to whom foster care maintenance payments are being made under section 472.". (c) EFFECTIVE DATE.—The amendments made by this section shall 42 USC 602 note. become effective April 1, 1988. SEC. 9134. INCREASED FUNDING FOR SOCIAL SERVICES BLOCK GRANTS.

(a) INCREASE IN FUNDING.—Section 2003(c) of the Social Security Act is amended— 42 USC 1397b. (A) by striking "and" at the end of paragraph (2); (B) in paragraph (3), by striking "year" the first place it appears and all that follows through the period and inserting "years 1984, 1985, 1986, and 1987, and for each succeeding fiscal year other than the fiscal year 1988; and"; and (C) by adding at the end the following new paragraph: "(4) $2,750,000,000 for the fiscal year 1988.". OJ) REQUIREMENT THAT ADDITIONAL FUNDS SUPPLEMENT AND NOT SUPPLANT FUNDS AVAILABLE FROM OTHER SOURCES.—The additional

42 USC 1397b note.

$50,000,000 made available to the States for the fiscal year 1988 pursuant to the amendments made by subsection (a) shall— (A) be used only for the purpose of providing additional services under title XX of the Social Security Act; and (B) be expended only to supplement the level of any funds that would, in the absence of the additional funds appropriated pursuant to such amendments, be available from other sources (including any amounts available under title XX of the Social Security Act without regard to such amendments) for services in accordance with such title, and shall in no case supplant such funds from other sources or reduce the level thereof SEC. 9135. EXTENSION OF SOCIAL SERVICES BLOCK GRANT AND CHILD WELFARE SERVICES PROGRAMS TO AMERICAN SAMOA.

(a) SOCIAL SERVICES BLOCK GRANT PROGRAM.—(1) Section 1101(a)(1) of the Social Security Act is amended by inserting "Amer- 42 USC 1301. ican Samoa," after "Guam," in the last sentence. (2)(A) Section 2003(a) of such Act is amended by adding at the end the following new sentence: "The allotment for fiscal year 1989 and each succeeding fiscal year to American Samoa shall be an amount which bears the same ratio to the amount allotted to the Northern Mariana Islands for that fiscal year as the population of American Samoa bears to the population of the Northern Mariana Islands determined on the basis of the most recent data available at the time such allotment is determined.". (B) Section 20030t>) of such Act is amended by inserting "American Samoa," after "the Virgin Islands," each place it appears. (b) CHILD WELFARE SERVICES PROGRAM.—(1) Section 1101(a)(1) of such Act is amended by adding at the end thereof the following new sentence: "Such term when used in part B of title IV also includes American Samoa.". (2) Section 4210t)) of such Act is amended by striking "and Guam" 42 USC 621. ^ and inserting "Guam, and American Samoa". (c) EFFECTIVE DATE.—The amendments made by this section shall 42 USC 62i note. apply with respect to fiscal years beginning on or after October 1, 1988.

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 101 STAT. 1330-316 Establishment.

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SEC. 9136. NATIONAL COMMISSION ON CHILDREN.

Part A of title XI of the Social Security Act is amended by adding at the end the following new section: ^ NATIONAL COMMISSION ON CHILDREN

42 USC 1320b-9.

"SEC. 1139. (a)(1) There is hereby established a commission to be known as the National Commission on Children (in this section referred to as the'Commission'). .ty, "(b)(1) The Commission shall consist of— President of U.S. "(A) 12 members to be appointed by the President, "(B) 12 members to be appointed by the Speaker of the House of Representatives, and "(C) 12 members to be appointed by the President pro tempore of the Senate. President of U.S. "(2) The President, the Speaker, and the President pro tempore shall each appoint as members of the Commission— "(A) 4 individuals who— " j, "(i) are representatives of organizations providing services to children, "(ii) are involved in activities on behalf of children, or "(iii) have engaged in academic research with respect to the problems and needs of children, "(B) 4 individuals who are elected or appointed public officials (at the Federal, State, or local level) involved in issues and programs relating to children, and "(C) 4 individuals who are parents or representatives of parents or parents' organizations. "(3) The appointments made pursuant to subparagraphs (B) and (C) of paragraph (1) shall be made in consultation with the chairmen of committees of the House of Representatives and the Senate, respectively, having jurisdiction over relevant Federal programs. Reports. "(c)(1) It shall be the duty and function of the Commission to serve as a forum on behalf of the children of the Nation and to conduct the studies and issue the report required by subsection (d). ^ '^ ' "(2) The Commission (and any committees that it may form) shall conduct public hearings in different geographic areas of the country, both urban and rural, in order to receive the views of a broad spectrum of the public on the status of the Nation's children and on ways to safeguard and enhance the physical, mental, and emotional well-being of all of the children of the Nation, including those with physical or mental disabilities, and others whose circumstances deny them a full share of the opportunities that parents of the Nation may rightfully expect for their children. "(3) The Commission shall receive testimony from individuals, and from representatives of public and private organizations and institutions with an interest in the welfare of children, including educators, health care professionals, religious leaders, providers of social services, representatives of organizations with children as members, elected and appointed public officials, and from parents and children speaking in their own behalf. Reports. "(d) The Commission shall submit to the President, and to the Committees on Finance and Labor and Human Resources of the yon i J Senate and the Committees on Ways and Means, Education and Labor, and Energy and Commerce of the House of Representatives, an interim report no later than September 30, 1988, and a final

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report no later than March 31, 1989, setting forth recommendations with respect to the following subjects: "(1) Questions relating to the health of children that the Commission shall address include— f "(A) how to reduce infant mortality, "(B) how to reduce the number of low-birth-weight babies, 5.1^'!; "(C) how to reduce the number of children with chronic illnesses and disabilities, irfi "(D) how to improve the nutrition of children,

"(E) how to promote the physical fitness of children, "(F) how to ensure that pregnant women receive adequate prenatal care, %:i y "(G) how to ensure that all children have access to both preventive and acute care health services, and ?' h. "(H) how to improve the quality and availability of health ' care for children. "(2) Questions relating to social and support services for children and their parents that the Commission shall address include— "(A) how to prevent and treat child neglect and abuse, "(B) how to provide help to parents who seek assistance in meeting the problems of their children, "(C) how to provide counseling services for children, "(D) how to strengthen the family unit, "(E) how children can be assured of adequate care while their parents are working or participating in education or training programs, "(F) how to improve foster care and adoption services, "(G) how to reduce drug and alcohol abuse by children and youths, and "(H) how to reduce the incidence of teenage pregnancy. "(3) Questions relating to education that the Commission shall address include— "(A) how to encourage academic excellence for all children at all levels of education, "(B) how to use preschool experiences to enhance educational achievement, "(C) how to improve the qualifications of teachers, "(D) how schools can better prepare the Nation's youth to compete in the labor market, "(E) how parents and schools can work together to help children achieve success at each step of the academic ladder, "(F) how to encourage teenagers to complete high school c. and remain in school to fulfill their academic potential, "(G) how to address the problems of drug and alcohol tQ abuse by young people, "(H) how schools might lend support to efforts aimed at reducing the incidence of teenage pregnancy, and "(I) how schools might better meet the special needs of children who have physical or mental handicaps. "(4) Questions relating to income security that the Commission shall address include— "(A) how to reduce poverty among children, "(B) how to ensure that parents support their cnildren to the fullest extent possible through improved child support

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- . '..r collection services, including services on behalf of children whose parents are unmarried, and ^ "(C) how to ensure that cash assistance to needy children is adequate. "(5) Questions relating to tax policy that the Commission shall address include— "(A) how to assure the equitable tax treatment of families with children, "(B) the effect of existing tax provisions, including the r,,%• dependent care tax credit, the earned income tax credit, ,. and the targeted jobs tax credit, on children living in poverty, ,s,M. "(C) whether the dependent care tax credit should be refundable and the effect of such a policy, •i]:. "(D) whether the earned income tax credit should be adjusted for family size and the effect of such a policy, and "(E) whether there are other tax-related policies which would reduce poverty among children. "(6) In addition to addressing the questions specified in paragraphs (1) through (5), the Commission shall— "(A) seek to identify ways in which public and private organizations and institutions can work together at the community level to identify deficiencies in existing services for families and children and to develop recommendations

to ensure that the needs of families and children are met, , using all available resources, in a coordinated and comprehensive manner, and "(B) assess the existing capacities of agencies to collect and analyze data on the status of children and on relevant programs, identify gaps in the data collection system, and recommend ways to improve the collection of data and the coordination among agencies in the collection and utilization of data. The reports required by this subsection shall be based upon the testimony received in the hearings conducted pursuant to subsection (c), and upon other data and findings developed by the Commission. "(e)(1)(A) Members of the Commission shall first be appointed not later than 60 days after the date of the enactment of this section, for terms ending on March 31, 1989. "(B) A vacancy in the Commission shall not affect its powers, but shall be filled in the same manner as the vacant position was first filled. "(2) The Commission shall elect one of its members to serve as Chairman of the Commission. The Chairman shall be a nonvoting member of the Commission. "(3) A majority of the members of the Commission shall constitute a quorum for the transaction of business. (4)(A) The Commission shall meet at the call of the Chairman, or at the call of a majority of the members of the Commission. "(B) The Commission shall meet not less than 4 times during the period beginning with the date of the enactment of this section and ending with March 31, 1989. "(5) Decisions of the Commission shall be according to the vote of a simple majority of those present and voting at a properly called meeting, "(6) Members of the Commission shall serve without compensation, but shall be reimbursed for travel, subsistence, and other

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necessary expenses incurred in the performance of their duties as members of the Commission. "(f)(1) The Commission shall appoint an Executive Director of the Commission who shall be compensated at a rate fixed by the Commission, but which shall not exceed the rate established for level V of the Executive Schedule under title 5, United States Code. "(2) In addition to the Executive Director, the Commission may appoint and fix the compensation of such personnel as it deems advisable, in accordance with the provisions of title 5, United States Code, governing appointments to the competitive service, and the provisions of chapter 51 and subchapter III of chapter 53 of such title, relating to classification and General Schedule pay rates. "(g) In carrying out its duties, the Commission, or any duly organized committee thereof, is authorized to hold such hearings, sit and act at such times and places, and take such testimony, with respect to matters for which it has a responsibility under this section, as the Commission or committee may deem advisable. "(h)(1) The Commission may secure directly from any department or agency of the United States such data and information as may be necessary to carry out its responsibilities. "(2) Upon request of the Commission, any such department or agency shall furnish any such data or information. "(i) The General Services Administration shall provide to the Commission, on a reimbursable basis, such administrative support services as the Commission may request. "(j) There are authorized to be appropriated such sums as may be necessary to carry out this section.", SEC. 9137. BOARDER BABIES DEMONSTRATION PROJECT,

Section 426 of the Social Security Act is amended— 42 USC 626. (1) by redesignating subsection (b) as subsection (c); and (2) by inserting immediately after subsection (a) the following new subsection: "(b)(1) There are authorized to be appropriated $4,000,000 for each of the fiscal years 1988, 1989, and 1990 for grants by the Secretary to public or private nonprofit entities submitting applications under this subsection for the purpose of conducting demonstration projects under this subsection to develop alternative care arrangements for infants who do not have health conditions that require hospitalization and who would otherwise remain in inappropriate hospital settings. "(2) The demonstration projects conducted under this section may include— "(A) multidisciplinary projects designed to prevent the inappropriate hospitalization of infants and to allow infants described in paragraph (1) to remain with or return to a parent in a residential setting, where appropriate care for the infant and suitable treatment for the parent (including treatment for drug or alcohol addiction) may be assured, with the goal (where possible) of rehabilitating the parent and eliminating the need for such care for the infant; "(B) multidisciplinary projects that assure appropriate, individualized care for such infants in a foster home or other non-medical residential setting in cases where such infant does not require hospitalization and would otherwise remain in inappropriate hospital settings, including projects to dem-

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PUBLIC LAW 100-203—DEC. 22, 1987

onstrate methods to recruit, train, and retain foster care families; and "(C) such other projects as the Secretary determines will best serve the interests of such infants and will serve as models for projects that agencies or organizations in other communities may wish to develop. "(3) In the case of any project which includes the use of funds authorized under this subsection for the care of infants in foster homes or other non-medical residential settings away from their parents, there shall be developed for each such infant a case plan of the type described in section 475(1) (to the extent that such infant is not otherwise covered by such a plan), and each such project shall include a case review system of the type described in section 475(5) (covering each such infant who is not otherwise subject to such a system). "(4) In evaluating applications from entities proposing to conduct demonstration projects under this subsection, the Secretary shall give priority to those projects that serve areas most in need of alternative care arrangements for infants described in paragraph (1). "(5) No project may be funded unless the application therefor contains assurances that it will— "(A) provide for adequate evaluation; "(B) provide for coordination with local governments; "(C) provide for community education regarding the inappropriate hospitalization of infants; "(D) use, to the extent practical, other available private, local. State, and Federal sources for the provision of direct services; and "(E) meet such other criteria as the Secretary may prescribe. "(6) Grants may be used to pay the costs of maintenance and of necessary medical and social services (to the extent that these costs are not otherwise paid for under other titles of this Act), and for such other purposes as the Secretary may allow. "(7) The Secretary shall provide training and technical assistance to grantees, as requested.". SEC. 9138. STUDY OF INFANTS AND CHILDREN WITH AIDS IN FOSTER CARE.

(a) IN GENERAL.—The Secretary of Health and Human Services (in this section referred to as the "Secretary") shall conduct (or arrange for) a survey to determine— (1) the total number of infants and children in the United States who have been diagnosed as having acquired immune deficiency syndrome and who have been placed in foster care; (2) the problems encountered by social service agencies in placing infants and children with such syndrome in foster care; and (3) the potential increase (over the five-year period beginning on the date of the enactment of this Act) in the number of infants and children with such syndrome who will require foster care. For purposes of this section, an infant or child with acquired immune deficiency syndrome includes an infant or child who is infected with the virus associated with such syndrome. (b) RESTRICTION ON SCOPE OF SURVEY.—In conducting (or arranging for) the survey under subsection (a), the Secretary shall assure

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that survey activities do not duplicate research activities conducted by the Centers for Disease Control. (c) REPORT.—Not later than 12 months after the date of enactment of this Act, the Secretary shall report to the Congress on the results of the survey conducted under subsection (a) and shall make recommendations to the Congress with respect to improving the care of infants and children with acquired immune deficiency syndrome who lack ongoing parental involvement and support. SEC. 9139. TECHNICAL CORRECTIONS.

•

(a) The last sentence of section 472(a) of the Social Security Act is 42 USC 672. amended by striking out "473(a)(1)(B)" and inserting in lieu thereof "473(a)(2)(B)". (b) Section 201(b)(2)(B) of the Immigration Reform and Control Act of 1986 is amended by striking out "Section 473(a)(1) of such Act" 42 USC 673. and inserting in lieu thereof "Section 473(a)(2) of such Act (as amended by section 1711(a) of the Tax Reform Act of 1986)". PART 3—CHILD SUPPORT ENFORCEMENT AMENDMENTS

•if \i

SEC. 9141. CONTINUATION iW CHILD SUPPORT ENFORCEMENT SERVICES TO FAMILIES NO LONGER RECEIVING AFDC.

(a) IN GENERAL.—(1) Section 457(c) of the Social Security Act is 42 USC 657. amended to read as follows: "(c) Whenever a family with respect to which child support enforcement services have been provided pursuant to section 454(4) '•'* " _ ^ ceases to receive assistance under part A of this title, the State shall provide appropriate notice to the family and continue to provide such services, and pay any amount of support collected, subject to the same conditions and on the same basis as in the case of the individuals to whom services are furnished pursuant to section 454(6), except that no application or other request to continue services shall be required of a family to which this subsection applies, and the provisions of section 454(6)(B) may not be applied.". (2) Section 454(5) of such Act is amended by striking "(except as 42 USC 654. provided in section 457(c))". (b) EFFECTIVE DATE.—The amendments made by subsection (a) 42 USC 654 note. shall become effective upon enactment. SEC. 9142. CHILD SUPPORT ENFORCEMENT SERVICES REQUIRED FOR CERTAIN FAMILIES RECEIVING MEDICAID.

(a) IN GENERAL.—Section 454 of the Social Security Act is amended— (1)(A) by striking "an assignment under section 402(a)(26) of this title" in paragraph (4)(A) and inserting "an assignment under section 402(a)(26) or section 1912"; (B) by striking ", and" at the end of paragraph (4)(A) and inserting ", or, in the case of such a child with respect to whom an assignment under section 1912 is in effect, the State agency administering the plan approved under title XIX determines pursuant to section 1912(a)(l)(B) that it is against the best interests of the child to do so, and"; and (C) by inserting "or medical assistance under a State plan approved under title XIX" immediately after "aid to families with dependent children" in paragraph (4)(B); and (2)(A) by striking "provide that," and inserting "provide that (A)" in paragraph (5); and

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(B) by striking the semicolon at the end of paragraph (5) and inserting "; and (B) in any case in which support payments are collected for an individual pursuant to the assignment made under section 1912, such payments shall be made to the State for distribution pursuant to section 1912, except that this clause shall not apply to such payments for any month after the month in which the individual ceases to be eligible for medical assistance;". 42 USC 654 note. (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall become effective on July 1, 1988. SEC. 9143. REPEAL OF UNNECESSARY CHILD SUPPORT REVOLVING FUND. 42 USC 652. (a) IN GENERAL.—Section 452(c) of the Social Security Act is amended to read as follows: "(c) The Secretary of the Treasury shall from time to time pay to each State for distribution in accordance with the provisions of section 457 the amount of each collection made on behalf of such State pursuant to subsection (b).". 42 USC 652 note. (b) EFFECTIVE DATE.—The amendment made by subsection (a) shall apply with respect to amounts collected after the date of the enactment of this Act.

PART 4—UNEMPLOYMENT COMPENSATION 26 USC 3304 note.

SEC. 9151. DETERMINATION OF AMOUNT OF FEDERAL SHARE WITH RESPECT TO CERTAIN EXTENDED BENEFITS PAYMENTS.

For the purpose of determining the amount of the Federal payment to any State under section 204(a)(l) of the Federal-State Extended Unemployment Compensation Act of 1970 with respect to the implementation of paragraph (3) of section 202(a) of such Act (as added by section 1024(a) of the Omnibus Reconciliation Act of 1980), such paragraph shall be considered to apply only with respect to weeks of unemployment beginning after October 31, 1981, except that for any State in which the State legislature did not meet in 1981, it shall be considered to apply for such purpose only with respect to weeks of unemployment beginning after October 31, 1982. Contracts. 26 USC 3304 note.

SEC. 9152. DEMONSTRATION PROGRAM TO PROVIDE SELF-EMPLOYMENT ALLOWANCES FOR ELIGIBLE INDIVIDUALS.

(a) IN GENERAL.—The Secretary of Labor (hereinafter in this section referred to as the "Secretary") shall carry out a demonstration program under this section for the purpose of making available self-employment allowances to eligible individuals. To carry out such program, the Secretary shall enter into agreements with three States that— (1) apply to participate in such program, and (2) demonstrate to the Secretary that they are capable of implementing the provisions of the agreement. (b) SELECTION OF STATES.—(1) In determining whether to enter into an agreement with a State under this section, the Secretary shall take into consideration at least— (A) the availability and quality of technical assistance currently provided by agencies of the State to the self-employed; (B) existing local market conditions and the business climate for new, small business enterprises in the State;

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(C) the adequacy of State resources to carry out a regular unemployment compensation program and a program under this section; (D) the range and extent of specialized services to be provided by the State to individuals covered by such an agreement; (E) the design of the evaluation to be applied by the State to the program; and (F) the standards which are to be utilized by the State for the purpose of assuring that individuals who will receive selfemployment assistance under this section will have sufficient experience (or training) and ability to be self employed. (2) The Secretary may not enter into an agreement with any State under this section unless the Secretary makes a determination that the State's unemployment compensation program has adequate reserves. (c) PROVISIONS OF AGREEMENTS.—Any agreement entered into with a State under this section shall provide that— (1) each individual who is an eligible individual with respect to any benefit year beginning during the three-year period commencing on the date on which such agreement is entered into shall receive a self-employment allowance; (2) self-employment allowances made to any individual under this section shall be made in the same amount, on the same terms, and subject to the same conditions as regular or extended unemployment compensation, as the case may be, paid by such State; except that— (A) State and Federal requirements relating to availability for work, active search for work, or refusal to accept suitable work shall not apply to such individual; and (B) such individual shall be considered to be unemployed for purposes of the State and Federal laws applicable to unemployment compensation, as long as the individual meets the requirements applicable under this section to such individual; (3) to the extent that such allowances are made to an individual under this section, an amount equal to the amount of such allowances shall be charged against the amount that may be paid to such individual under State law for regular or extended unemployment compensation, as the case may be; (4) the total amount paid to an individual with respect to any benefit year under this section may not exceed the total amount that could be paid to such individual for regular or extended unemployment compensation, as the case may be, with respect to such benefit year under State law; (5) the State shall implement a program that— (A) is approved by the Secretary; (B) will not result in any cost to the Unemployment Trust Fund established by section 904(a) of the Social Security Act in excess of the cost which would have been incurred by such State and charged to such Fund if the State had not participated in the demonstration program under this 'dsection; (C) is designed to select and assist individuals for selfemployment allowances, monitor the individual's selfemployment, and provide, as described in subsection (d), to the Secretary a complete evaluation of the use of such allowances; and

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Reports.

PUBLIC LAW 100-203—DEC. 22, 1987

(D) otherwise meets the requirements of this section; and (6) the State, from its general revenue funds, shall— (A) repay to the Unemployment Trust Fund any cost •""*> incurred by the State and charged to the Fund which exceeds the cost which would have been incurred by such State and charged to such Fund if the State had not participated in the demonstration program under this section; and ^ ' '^ (B) in any case in which any excess cost described in subparagraph (A) is not repaid in the fiscal year in which it was charged to the Fund, pay to the Fund an amount of interest, on the outstanding balance of such excess cost, which is sufficient (when combined with any repayment by the State described in subparagraph (A)) to reimburse the Fund for any loss which would not have been incurred if such excess cost had not been incurred. (d) EVALUATION.—(1) Each State that enters into an agreement under this section shall carry out an evaluation of its activities under this section. Such evaluation shall be based on an experimental design with random assignment between a treatment group and a control group with not more than one-half of the individuals receiving assistance at any one time being assigned to the treatment group. (2) The Secretary shall use the data provided from such evaluation to analyze the benefits and the costs of the program carried out under this section, to formulate the reports under subsection (g), and to estimate any excess costs described in subsection (c)(6)(A). (e) FINANCING.—(1) Notwithstanding section 303(a)(5) of the Social Security Act and section 3304(a)(4) of the Internal Revenue Code of 1986, amounts in the unemployment fund of a State may be used by a State to make payments (exclusive of expenses of administration) for self-employment allowances made under this section to an individual who is receiving them in lieu of regular unemployment compensation. (2) In any case in which a self-employment allowance is made under this section to an individual in lieu of extended unemployment compensation under the Federal-State Extended Unemployment Compensation Act of 1970, payments made under this section for self-employment allowances shall be considered to be compensation described in section 204(a)(1) of such Act and paid under State law. (f) LIMITATION.—No funds made available to a State under title III of the Social Security Act or any other Federal law may be used for the purpose of administering the program carried out by such State under this section. (g) REPORT TO CONGRESS.—(1) Not later than two years after the date of the enactment of this Act, the Secretary shall submit an interim report to the Congress on the effectiveness of the demonstration program carried out under this section. Such report shall include— (A) information on the extent to which this section has been utilized; (B) an analysis of any barriers to such utilization; and (C) an analysis of the feasibility of extending the provisions of this section to individuals not covered by State unemployment compensation laws.

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101 STAT. 1330-325

(2) Not later than four years after the date of the enactment of this Act, the Secretary shall submit a final report to the Congress on such program. (h) FRAUD AND OVERPAYMENTS.—(1) If an individual knowingly

has made, or caused to be made by another, a false statement or representation of a material fact, or knowingly has failed, or caused another to fail, to disclose a material fact, and as a result of such false statement or representation or of such nondisclosure such individual has received payment under this section to which he was not entitled, such individual shall be— (A) ineligible for further assistance under this section; and (B) subject to prosecution under section 1001 of title 18, United States Code. (2)(A) If any person received any payment under this section to which such person was not entitled, the State is authorized to require such person to repay such assistance; except that the State agency may waive such repayment if it determines that— (i) the providing of such assistance or making of such payment was without fault on the part of such person; and (ii) such repayment would be contrary to equity and good conscience. (B) No repayment shall be required under subparagraph (A) until a determination has been made, notice thereof and an opportunity for a fair hearing has been given to the person, and the determination has become final. Any determination under such subparagraph shall be subject to review in the same manner and to the same extent as determinations under the State unemployment compensation law, and only in that manner and to that extent. (i) DEFINITIONS.—For purposes of this section— (1) the term "eligible individual" means, with respect to any benefit year, an individual who— (A) is eligible to receive regular or extended compensation under the State law during such benefit year; I (B) is likely to receive unemployment compensation for ( the maximum number of weeks that such compensation is made available under the State law during such benefit year;

(C) submits an application to the State agency for a self^' ' employment allowance under this section; and (D) meets applicable State requirements, except that not more than (i) 3 percent of the number of individuals eligible to receive regular compensation in a State at the beginning of a fiscal year, or (ii) the number of persons who exhausted their unemployment compensation benefits in the fiscal year ending before such fiscal year, whichever is lesser, may be considered as eligible individuals for such State for purposes of this section during such fiscal year; (2) the term "self-employment allowance" means compensation paid under this section for the purpose of assisting an eligible individual with such individual's self-employment; and (3) the terms "compensation", "extended compensation", "regular compensation", "benefit year", "State", and "State law", have the respective meanings given to such terms by section 205 of the Federal-State Extended Unemployment Compensation Act of 1970.

• K.:\J %'

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1120

 101 STAT. 1330-326

PUBLIC LAW 100-203—DEC. 22, 1987

SEC. 9153. EXTENSION OF FUTA TAX.

26 USC 3301 note.

(a) IN GENERAL.—Paragraphs (1) and (2) of section 8301 of the Federal Unemployment Tax Act (26 U.S.C. 3301) are amended to read as follows: "(1) 6.2 percent in the case of calendar years 1988, 1989, and 1990; or "(2) 6.0 percent in the case of calendar year 1991 and each calendar year thereafter;". (b) EFFECTIVE DATE.—The amendment made by subsection (a) shall apply to wages paid on or after January 1, 1988. SEC. 9154. TRANSFER OF FUNDS INTO THE FEDERAL UNEMPLOYMENT ACCOUNT AND THE EXTENDED UNEMPLOYMENT COMPENSATION ACCOUNT. (a) IN GENERAL.—Section 901 of the Social Security Act (42 U.S.C. 1101) is amended by adding at the end the following new subsection: "Transfers For Calendar Years 1988, 1989, and 1990 "(g)(1) With respect to calendar years 1988, 1989, and 1990, the Secretary of the Treasury shall transfer from the employment security administration account— "(A) to the Federal unemployment account an amount equal to 50 percent of the amount of tax received under section 3301(1) of the Federal Unemployment Tax Act which is attributable to the difference in the tax rates between paragraphs (1) and (2) of such section; and "(B) to the extended unemployment compensation account an amount equal to 50 percent of such amount of tax received. "(2) Transfers under this subsection shall be as of the beginning of the month succeeding the month in which the moneys were credited to the employment security administration account pursuant to subsection (b)(2) with respect to wages paid during such calendar years.". (b) INCREASE IN THE LIMITATION ON THE AMOUNTS IN SUCH AC-

42 USC 1101 note.

COUNTS.—(1) Section 902(a)(2) of such Act (42 U.S.C. 1102(a)(2)) is amended by striking out "one-eighth" and inserting in lieu thereof "five-eighths". (2) Section 905(b)(2)(B) of such Act (42 U.S.C. 1105a))(2)(B)) is amended by striking out "one-eighth" and inserting in lieu thereof "three-eighths". (c) CONFORMING AMENDMENTS.—(1) Section 9050bXl) of such Act (42 U.S.C. 1105(b)(l)) is amended by striking out the last sentence thereof (2) Section 901(c)(3)(C) of such Act (42 U.S.C. 1101(c)(3)(C)) is amended by striking out "(i)" and all that follows through the period and inserting in lieu thereof "a tax rate of 0.6 percent.". (d) EFFECTIVE DATE.—The amendments made by this section shall become effective on the date of the enactment of this Act. SEC. 9155. INTEREST ON ADVANCES TO THE FEDERAL UNEMPLOYMENT ACCOUNT AND THE EXTENDED UNEMPLOYMENT COMPENSATION ACCOUNT. (a) EXTENDED UNEMPLOYMENT COMPENSATION ACCOUNT.—Section

905(d) of the Social Security Act (42 U.S.C. 1105(d)) is amended— (1) by striking out 'Without interest)" and ", without interest,'; and

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1121

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-327

(2) by adding the following new sentence at the end: "Amounts appropriated as repayable advances for purposes of this subsection shall bear interest at a rate equal to the average rate of interest, computed as of the end of the calendar month next preceding the date of such advance, borne by all interest bearing obligations of the United States then forming part of the public debt; except that in cases in which such average rate is not a multiple of one-eighth of 1 percent, the rate of interest shall be the multiple of one-eighth of 1 percent next lower than such average rate.". (b) FEDERAL UNEMPLOYMENT ACCOUNT.—Section 1203 of such Act (42 U.S.C. 1323) is amended— (1) by striking out "(without interest)" and ", without interest,"; and (2) by adding the following new sentence at the end: "Amounts appropriated as repayable advances for purposes of this subsection shall bear interest at a rate equal to the average rate of interest, computed as of the end of the calendar month next preceding the date of such advance, borne by all interest bearing obligations of the United States then forming part of the public debt; except that in cases in which such average rate is not a multiple of one-eighth of 1 percent, the rate of interest shall be the multiple of one-eighth of 1 percent next lower than such average rate.". (c) CONFORMING AMENDMENT.—Section 903(a)(1) of such Act (42 U.S.C. 1103(a)(1)) is amended by inserting "and interest" after "all advances". (d) EFFECTIVE DATE.—The amendments made by this section shall 42 USC 1103 apply to advances made on or after the date of the enactment of this "ot^. Act. SEC. 9156. CREDITING TO THE FEDERAL UNEMPLOYMENT ACCOUNT OF INTEREST EARNED ON ADVANCES TO THE STATES.

(a) IN GENERAL.—Section 1202 of the Social Security Act is 42 USC 1322. amended by adding at the end the following new subsection: "(c) Interest paid by States in accordance with this section shall be credited to the Federal unemployment account established by section 904(g) in the Unemployment Trust Fund.". Ob) EFFECTIVE DATE.—The amendment made by subsection (a) 42 USC 1322 shall apply to interest paid on advances made on or after the date of ^°^^the enactment of this Act.

Subtitle C—Manufacturers Excise Tax on Certain Vaccines SEC. 9201. MANUFACTURERS EXCISE TAX ON CERTAIN VACCINES.

(a) IN GENERAL.—Chapter 32 of the Internal Revenue Code of 1986 (relating to manufacturers excise taxes) is amended by inserting after subchapter B the following new subchapter: "Subchapter C—Certain Vaccines "Sec. 4131. Imposition of tax. "Sec. 4132. Definitions and special rules.

91-194 O - 90 - 36: QL.3 Part 2

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1122

 101 STAT. 1330-328 26 USC 4131.

PUBLIC LAW 100-203—DEC. 22, 1987

"SEC. 4131. IMPOSITION OF TAX.

"(a) GENERAL RULE,—There is hereby imposed a tax on any taxable vaccine sold by the manufacturer, producer, or importer thereof. "(b) AMOUNT OF TAX.—

"(1) IN GENERAL.—The amount of the tax imposed by subsection (a) shall be determined in accordance with the following table:

r

'••" ^''' "•'••• "If the taxable vaccine is: t DPT vaccine DT vaccine ,, MMR vaccine • I.« Polio vaccine

'\*''' "

' "

The tax per dose is: $4.56 0.06 4.44 0.29.

"(2) COMBINATIONS OF VACCINES.—If any taxable vaccine is

r^j. y .• < .'

included in more than 1 category of vaccines in the table contained in paragraph (1), the amount of the tax imposed by subsection (a) on such vaccine shall be the sum of the amounts determined under such table for each category in which such vaccine is so included.

"(c) TERMINATION OF TAX IF AMOUNTS COLLECTED EXCEED PROJECTED FUND LIABILITY.—

"(1) IN GENERAL.—If the Secretary estimates under paragraph (3) that the Vaccine Injury Compensation Trust Fund would not have a negative projected balance were the tax imposed by this section to terminate as of the close of any applicable date, no tax shall be imposed by this section after such date.

7j ,,..

^

,

"(2) APPLICABLE DATE.—For purposes of paragraph (1), the

^

term 'applicable date' means— "(A) the close of any calendar quarter ending on or after December 31, 1992, and '•I© i^"(B) the 1st date on which petitions may not be filed under section 2111 and 2111(a) of the Public Health Service V;•>;; ^^^ ^y reason of section 2134 of such Act and each date ,r,.,,- J,j thereafter.

,

,

--

"" ''

.

,

"(3) E S T I M A T E S BY SECRETARY.—

"(A) IN GENERAL.—The Secretary shall estimate the projected balance of the Vaccine Injury Compensation Trust Fund as of— "(i) the close of each calendar quarter ending on or after December 31, 1992, and "(ii) such other times as are appropriate in the case of applicable dates described in paragraph (2)(B). •I* "(B) DETERMINATION OF PROJECTED BALANCE.—In determining the projected balance of the Fund as of any date, the Secretary shall assume that— "(i) the tax imposed by this section will not apply a after such date, and "(ii) there shall be paid from such Trust Fund all ^ ^.r'Sf T^ claims made or to be made against such Trust Fund— I^ ,..-.. 1 { ttQ^ ^j^j^ respect to vaccines administered before October 1, 1992, in the case of an applicable date described in paragraph (2)(A), or "(II) with respect to petitions filed under section 2111 or section 2111(a) of the Public Health Service Act, in the case of an applicable date described in paragraph (2)(B).
 * ^ r t i.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1123

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-329

"SEC. 4132. DEFINITIONS AND SPECIAL RULES.

26 USC 4132.

"(a) DEFINITIONS RELATING TO TAXABLE VACCINES.—For purposes

of this subchapter— "(1) TAXABLE VACCINE.—The term 'taxable vaccine' means any vaccine— "(A) which is listed in the table contained in section 4131(b)(1), and "(B) which is manufactured or produced in the United States or entered into the United States for consumption, ^ use, or warehousing. -''' "(2) DPT VACCINE.—The term 'DPT vaccine' means any vaccine containing pertussis bacteria, extracted or partial cell bacteria, or specific pertussis antigens. "(3) DT VACCINE.—The term 'DT vaccine' means any vaccine (other than a DPT vaccine) containing diphtheria toxoid or tetanus toxoid. "(4) MMR VACCINE,—The term "MMR vaccine' means any vaccine against measles, mumps, or rubella. Not more than 1 tax shall be imposed by section 4131 on any MMR vaccine by reason of being a vaccine against more than 1 of measles, mumps, or rubella. "(5) POLIO VACCINE.—The term 'polio vaccine' means any vaccine containing polio virus. "(6) VACCINE.—The term 'vaccine' means any substance designed to be administered to a human being for the prevention of 1 or more diseases. "(7) UNITED STATES.—The term 'United States' has the meaning given such term by section 4612(a)(4). "(8) IMPORTER.—The term 'importer* means the person entering the vaccine for consumption, use, or warehousing.

.^^ ' •'

"(b) CREDIT OR REFUND WHERE VACCINE RETURNED TO MANUFACTURER, ETC., OR DESTROYED.—

1

"(1) IN GENERAL.—Under regulations prescribed by the Secretary, whenever any vaccine on which tax was imposed by section 4131 is— "(A) returned (other than for resale) to the person who paid such tax, or "(B) destroyed, the Secretary shall abate such tax or allow a credit, or pay a refund (without interest), to such person equal to the tax paid under section 4131 with respect to such vaccine. "(2) CLAIM MUST BE FILED WITHIN 6 MONTHS.—Paragraph (1)

shall apply to any returned or destroyed vaccine only with respect to claims filed within 6 months after the date the vaccine is returned or destroyed. ^

"(3) CONDITION OF ALLOWANCE OF CREDIT OR REFUND.—No

credit or refund shall be allowed or made under paragraph (1) with respect to any vaccine unless the person who paid the tax establishes that he— "(A) has repaid or agreed to repay the amount of the tax fi >'! •> ^Q |.jjg ultimate purchaser of the vaccine, or "(B) has obtained the written consent of such purchaser '^ ' to the allowance of the credit or the making of the refund. "(4) TAX IMPOSED ONLY ONCE.—No tax shall be imposed by section 4131 on the sale of any vaccine if tax was imposed by

'

'.',

^ ^^

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1124

 101 STAT. 1330-330

PUBLIC LAW 100-203—DEC. 22, 1987

section 4131 on any prior sale of such vaccine and such tax is not abated, credited, or refunded. "(c) OTHER SPECIAL RULES.— "(1) FRACTIONAL PART OF A DOSE.—In the case of a fraction of a

dose, the tax imposed by section 4131 shall be the same fraction of the amount of such tax imposed by a whole dose. i

"(2) DISPOSITION OF REVENUES FROM PUERTO RICO AND THE VIRGIN ISLANDS.—The provisions of subsections (a)(3) and (b)(3)

of section 7652 shall not apply to any tax imposed by section 4131." (b) CERTAIN PROVISIONS RELATING TO TAX-FREE SALES, ETC. NOT TO APPLY.—

26 USC 4221.

26 USC 4131 note.

(1) Subsection (a) of section 4221 of such Code (relating to certain tax-free sales) is amended by adding at the end thereof the following new sentence: "In the case of the tax imposed by section 4131, paragraphs (3), (4), and (5) shall not apply and paragraph (2) shall apply only if the use of the exported vaccine f: meets such requirements as the Secretary may by regulations I prescribe." ' (2) Paragraph (2) of section 6416(b) of such Code (relating to ^ specified uses or resales) is amended by adding at the end thereof the following new sentence: "In the case of the tax imposed by section 4131, subparagraphs (B), (C), and (D) shall not apply and subparagraph (A) shall apply only if the use of the exported vaccine meets such requirements as the Secretary may by regulations prescribe." (c) CLERICAL AMENDMENT.—The table of subchapters for chapter 32 of such Code is amended by inserting after the item relating to subchapter B the following new item: "SUBCHAPTER C. Certain vaccines." (d) EFFECTIVE DATE.—The amendments made by this section shall

take effect on January 1, 1988. SEC. 9202. VACCINE INJURY COMPENSATION TRUST FUND.

(a) IN GENERAL.—Subchapter A of chapter 98 of the Internal Revenue Code of 1986 (relating to trust fund code) is amended by adding at the end thereof the following new section: 26 USC 9510.

"SEC. 9510. VACCINE INJURY COMPENSATION TRUST FUND.

"(a) CREATION OF TRUST FUND.—There is established in the Treasury of the United States a trust fund to be known as the 'Vaccine Injury Compensation Trust Fund', consisting of such amounts as may be credited to such Trust Fund as provided in section 9602(b). "(b) TRANSFERS TO TRUST FUND.—

"(1) IN GENERAL.—There are hereby appropriated to the Vaccine Injury Compensation Trust Fund amounts equivalent to the net revenues received in the Treasury from the tax imposed by section 4131 (relating to tax on certain vaccines). "(2) NET REVENUES.—For purposes of paragraph (1), the term 'net revenues' means the amount estimated by the Secretary based on the excess of— "(A) the taxes received in the Treasury under section 4131 (relating to tax on certain vaccines), over "(B) the decrease in the tax imposed by chapter 1 resulting from the tax imposed by section 4131. "(c) EXPENDITURES FROM TRUST FUND.—

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1125

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-331

"(1) IN GENERAL.—Amounts in the Vaccine Injury Compensation Trust Fund shall be available, as provided in appropriation Acts, only for the payment of compensation under subtitle 2 of title XXI of the Public Health Service Act (as in effect on the date of the enactment of this section) for vaccine-related injury or death with respect to vaccines administered after September 30, 1988, and before October 1, 1992. "(2) TRANSFERS FOR CERTAIN REPAYMENTS.—

,,.

"(A) IN GENERAL.—The Secretary shall pay from time to time from the Vaccine Injury Compensation Trust Fund into the general fund of the Treasury amounts equivalent to amounts paid under section 4132(b) and section 6416 with respect to the taxes imposed by section 4131. "(B) TRANSFERS BASED ON ESTIMATES.—Transfers under subparagraph (A) shall be made on the basis of estimates by the Secretary, and proper adjustments shall be made in the amounts subsequently transferred to the extent prior estimates were in excess of or less than the amounts required to be transferred.

"(d) LIABILITY OF UNITED STATES LIMITED TO AMOUNT IN TRUST FUND.— "(1) GENERAL RULE.—Any claim filed against the Vaccine

Injury Compensation Trust Fund may be paid only out of such Trust Fund. "(2) COORDINATION WITH OTHER PROVISIONS.—Nothing in

the

National Childhood Vaccine Injury Act of 1986 (or in any amendment made by such Act) shall authorize the payment by the United States Government of any amount with respect to any such claim out of any source other than the Vaccine Injury Compensation Trust Fund. "(3) ORDER IN WHICH UNPAID CLAIMS TO BE PAID.—If at

any

time the Vaccine Injury Compensation Trust Fund has insufficient funds to pay all of the claims out of such Trust Fund at such time, such claims shall, to the extent permitted under paragraph (1) be paid in full in the order in which they are finally determined." (b) CLERICAL AMENDMENT.—The table of sections for such subchapter A is amended by adding at the end thereof the following new item: "Sec. 9510. Vaccine Injury Compensation Trust Fund." (c) EFFECTIVE DATE.—The amendments made by this section shall

take effect on January 1, 1988.

26 USC 9510 note.

Subtitle D—Pension Provisions PART I—FULL-FUNDING LIMITATIONS SEC. 9301. FULL-FUNDING LIMITATION FOR DEDUCTIONS TO QUALIFIED PLANS.

(a) GENERAL RULE.—Paragraph (7) of section 412(c) of the Internal Revenue Code of 1986 (defining full-funding limitation) is amended to read as follows: "(7) FULL-FUNDING LIMITATION.—

"(A) IN GENERAL.—For purposes of paragraph (6), the term 'full-funding limitation' means the excess (if any) of—

26 USC 412.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1126

 101 STAT. 1330-332 •'"-

• <^-'.

'^'

PUBLIC LAW 100-203—DEC. 22, 1987 "(i) the lesser of (I) 150 percent of c u r r e n t liability, or (II) the accrued liability (including n o r m a l cost) under the plan (determined under the entry age n o r m a l funding method if such accrued liability cannot be directly calculated under the funding method used for the plan), over "(ii) the lesser of— "(I) the fair m a r k e t value of the plan's assets, or "(II) the value of such assets determined under paragraph (2). "(B) C U R R E N T LIABILITY.—For purposes of subparagraph s

" *>'

(A) and (D), the term ' c u r r e n t liability' has the m e a n i n g given such term by subsection (1)(7) (without regard to subparagraph (D) thereof). "(C) SPECIAL RULE FOR PARAGRAPH (GKB).—For

purposes

of paragraph (6)(B), subparagraph (A)(i) shall be applied without regard to subclause (I) thereof. "(D) REGULATORY AUTHORITY.—The

Secretary

may

by

regulations provide— ''-" ' ' "(i) for adjustments to the percentage contained in subparagraph (A)(i) to t a k e into account the respective '^ ' ages or lengths of service of the participants, ' "^' "(ii) a l t e r n a t i v e methods based on factors other than c u r r e n t liability for the determination of the a m o u n t ', t a k e n into account under subparagraph (A)(i), and '* ' "(iii) for the t r e a t m e n t under this section of contribu^ tions which would be required to be m a d e under the plan b u t for the provisions of subparagraph (A)(i)(I)." (b) AMENDMENT TO E R I S A. — Paragraph (7) of section 302(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1082(c)(7)) is amended to read as follows: "(7) F U L L - F U N D I N G LIMITATION.—

' - '^ ' '•

"(A) IN GENERAL.—For purposes of paragraph (6), the term 'full-funding limitation' means the excess (if any) of— "(i) the lesser of (I) 150 percent of c u r r e n t liability, or ^ J (II) the accrued liability (including n o r m a l cost) under ^ ^ J !^^ ' the plan (determined under the entry age n o r m a l funding method if such accrued liability cannot be directly calculated under the funding method used for the plan), over •.''•' ' "(ii) the lesser of— "(I) the fair m a r k e t value of the plan's assets, or "(II) the value of such assets determined under paragraph (2). "(B) C U R R E N T L I A B I U T Y. — For purposes of subparagraph s

(A) and (D), the term ' c u r r e n t liability' has the m e a n i n g given such term by subsection (d)(7) (without regard to subparagraph (D) thereof). fiarf.

>•;. ....

, fi'.,i

<<(Q SPECIAL RULE FOR PARAGRAPH (GMB).—For purposes

of paragraph (6)(B), subparagraph (A)(i) shall b e applied without regard to subclause (I) thereof. "(D)

REGULATORY

AUTHORITY.—The

Secretary

of

the

Treasury may by regulations provide— "(i) for adjustments to the percentage contained in '^i .V' ». subparagraph (A)(i) to t a k e into account the respective It* ( « ' ages or lengths of service of the participants,

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1127

 PUBLIC LAW 100-203—DEC. 22, 1987 ^ ,,

y

101 STAT. 1330-333

"(ii) alternative methods based on factors other than current liability for the determination of the amount taken into account under subparagraph (A)(i), and "(iii) for the treatment under this section of contributions which would be required to be made under the plan but for the provisions of subparagraph (A)(i)(I)."

(c) EFFECTIVE DATE.— 26 USC 412 note. (1) IN GENERAL.—The amendments made by this section shall apply to years beginning after December 31, 1987. (2) REGULATIONS.—The Secretary of the Treasury or his delegate shall prescribe such regulations as are necessary to carry out the amendments made by this section no later than August 15, 1988. (3) STUDY.—The Secretary of the Treasury or his delegate shall study the effect of the amendments made by this section on benefit security under defined benefit pension plans and shall report the results of such study to the Committee on Ways and Means of the House of Representatives and to the Committee on Finance of the Senate no later than August 15, 1988.

PART II—PENSION FUNDING AND TERMINATION Pension Protection Act. REQUIREMENTS SEC. 9302. SHORT TITLE; DEFINITIONS.

(a) SHORT TITLE.—This part may be cited as the "Pension Protec- 26 USC l note. tion Act". (b) DEFINITIONS.—For purposes of this part— (1) 1986 CODE.—The term "1986 Code" means the Internal Revenue Code of 1986. (2) ERISA.—The term "ERISA" means the Employee Retirement Income Security Act of 1974.

Subpart A—Modifications of Minimum Funding Standard SEC. 9303. ADDITIONAL FUNDING REQUIREMENTS. (a) AMENDMENTS TO 1986 CODE.—

(1) IN GENERAL.—Section 412 of the 1986 Code (relating to 26 USC 412. minimum funding standard) is amended by adding at the end thereof the following new subsection: "(1) ADDITIONAL FUNDING REQUIREMENTS FOR PLANS WHICH ARE NOT MULTIEMPLOYER PLANS.—

"(1) IN GENERAL.—In the case of a defined benefit plan (other than a multiemployer plan) which has an unfunded current liability for any plan year, the amount charged to the funding standard account for such plan year shall be increased by the sum of— "(A) the excess (if any) of^ "(i) the deficit reduction contribution determined under paragraph (2) for such plan year, over "(ii) the sum of the charges for such plan year under subparagraphs (B) (other than clauses (iv) and (v) thereof), (C), and (D) of subsection (b)(2), reduced by the -ii sum of the credits for such plan year under subparagraph (B)(i) of subsection (b)(3), plus

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1128

 101 STAT. 1330-334

'-f'

PUBLIC LAW 100-203—DEC. 22, 1987

"(B) the unpredictable contingent event amount (if any) for such plan year. Such increase shall not exceed the amount necessary to increase the funded current liability percentage to 100 percent. "(2) DEFICIT REDUCTION CONTRIBUTION.—For purposes of paragraph (1), the deficit reduction contribution determined under this paragraph for any plan year is the sum of— "(A) the unfunded old liability amount, plus "(B) the unfunded new liability amount. "(3) UNFUNDED OLD LIABILITY AMOUNT.—For purposes of this subsection— "(A) IN GENERAL.—The unfunded old liability amount with respect to any plan for any plan year is the amount necessary to amortize the unfunded old liability under the plan in equal annual installments over a period of 18 plan years (beginning with the 1st plan year beginning after December 31, 1988). "(B) UNFUNDED OLD LIABILITY.—The term 'unfunded old liability' means the unfunded current liability of the plan as of the beginning of the 1st plan year beginning after December 31, 1987 (determined without regard to any plan amendment increasing liabilities adopted after October 16, 1987).

" -'

•'./ "' -: -'

"(C) SPECIAL RULES FOR BENEFIT INCREASES UNDER EXISTING COLLECTIVE BARGAINING AGREEMENTS.—

' r-, '^ -^sK i i

-^ '

"(i) IN GENERAL.—In the case of a plan maintained pursuant to 1 or more collective bargaining agreements between employee representatives and the employer ratified before October 17, 1987, the unfunded old liability amount with respect to such plan for any plan year shall be increased by the amount necessary to amortize the unfunded existing benefit increase liability in equal annual installments over a period of 18 plan years beginning with— "(I) the plan year in which the benefit increase with respect to such liability occurs, or "(II) if the taxpayer elects, the 1st plan year beginning after December 31, 1988. "(ii) U N F U N D E D EXISTING BENEFIT INCREASE LikBiL-

•"

ITIES.—For purposes of clause (i), the unfunded existing • benefit increase liability means, with respect to any benefit increase under the agreements described in / clause (i) which takes effect during or after the 1st plan year beginning after December 31, 1987, the unfunded "" current liability determined— "(I) by taking into account only liabilities attrib:< utable to such benefit increase, and "(II) by reducing the amount determined under paragraph (8)(A)(ii) by the current liability determined without regard to such benefit increase, "(iii) EXTENSIONS, MODIFICATIONS, ETC. NOT TAKEN INTO ACCOUNT.—For purposes of this subparagraph, any extension, amendment, or other modification of an agreement after October 16, 1987, shall not be taken into account. "(4) UNFUNDED NEW LIABILITY AMOUNT.—For purposes of this subsection— -• -• — •• «^-.'..-. >.< -•„,>-; ••• -. • •:

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1129

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-335

"(A) IN GENERAL.—The unfunded new liability amount with respect to any plan for any plan year is the applicable percentage of the unfunded new liability. "(B) UNFUNDED NEW LIABILITY.—The term 'unfunded new liability' means the unfunded current liability of the plan for the plan year determined without regard to— "(i) the unamortized portion of the unfunded old liability, and "(ii) the liability with respect to any unpredictable contingent event benefits (without regard to whether the event has occurred). "(C) APPLICABLE PERCENTAGE.—The term 'applicable percentage' means, with respect to any plan year, 30 percent, reduced by the product of— "(i).25 multiplied by "(ii) the number of percentage points (if any) by which the funded current liability percentage exceeds 35 percent. "(5) UNPREDICTABLE CONTINGENT EVENT AMOUNT.—

"(A) IN GENERAL.—The unpredictable contingent event amount with respect to a plan for any plan year is an amount equal to the greater of— "(i) the applicable percentage of the product of— "(I) 100 percent, reduced (but not below zero) by the funded current liability percentage for the plan year, multiplied by "(II) the amount of unpredictable contingent event benefits paid during the plan year, including (except as provided by the Secretary) any payment for the purchase of an annuity contract for a participant or beneficiary with respect to such '; benefits, or "(ii) the amount which would be determined for the plan year if the unpredictable contingent event benefit liabilities were amortized in equal annual installments over 7 plan years (beginning with the plan year in which such event occurs). "(B) APPLICABLE PERCENTAGE.— "In the case of plan years beginning in: 1989 and 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 and thereafter

The applicable percentage is: 5 10 15 20 30 40 50 60 70 80 90 100.

"(C) PARAGRAPH NOT TO APPLY TO EXISTING BENEFITS.—

This paragraph shall not apply to unpredictable contingent event benefits (and liabilities attributable thereto) for which the event occurred before October 17, 1987. "(D)

SPECIAL RULE FOR FIRST YEAR OF AMORTIZATION.—

Unless the employer elects otherwise, the amount deter-

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1130

 101 STAT. 1330-336

PUBLIC LAW 100-203—DEC. 22, 1987

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mined under subparagraph (A) for the plan year in which the event occurs shall be equal to 150 percent of the a m o u n t determined under subparagraph (A)(i). The a m o u n t under ./;;. subparagraph (A)(ii) for subsequent plan years in the ir/v amortization period shall be adjusted in the m a n n e r provided by the Secretary to reflect the application of this subparagraph. "(6) S P E C I A L RULES FOR SMALL PLANS.— "(A) P L A N S WITH lOO OR FEWER

,

-

PARTICIPANTS.—This

subsection shall not apply to any plan for any plan year if on each day during the preceding plan year such plan had no more than 100 participants.

... >,

"(B) P L A N S WITH MORE THAN lOO BUT NOT MORE THAN 1 5 0

PARTICIPANTS.—In the case of a plan to which subparagraph (A) does not apply and which on each d a y during the preceding plan year h a d no more than 150 participants, the ^ a m o u n t of the increase under paragraph (1) for such plan year shall be equal to the product of— "(i) such increase determined without regard to this ,/:vv.i subparagraph, multiplied by n"(ii) 2 percent for the highest n u m b e r of participants in excess of 100 on any such day. "(C) AGGREGATION OF PLANS.—For purposes of t h i s para-

graph, all defined benefit plans m a i n t a i n e d by the same employer (or any m e m b e r of such employer's controlled group) shall be treated as 1 plan, b u t only employees of such employer or m e m b e r shall be t a k e n into account.

'

"(7) C U R R E N T LIABILITY.—For purposes of t h i s subsection—

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"(A) IN GENERAL.—The term 'current liability' means all liabilities to employees and their beneficiaries under the plan. "(B) T R E A T M E N TO F UNPREDICTABLE CONTINGENT EVENT BENEFITS.—

.'

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"(i) IN GENERAL.—For purposes of subparagraph (A), any unpredictable contingent event benefit shall not be t a k e n into account until the event on which the benefit is contingent occurs. "(ii) UNPREDICTABLE CONTINGENT EVENT BENEFIT.—

^ .; / ^.,

The term 'unpredictable contingent event benefit' means any benefit contingent on a n event other than— "(I) age, service, compensation, death, or disability, or "(II) a n event which is reasonably and reliably predictable (as determined by the Secretary). "(C) INTEREST RATES USED.—The r a t e of i n t e r e s t used to

determine c u r r e n t liability shall be the r a t e of interest used under subsection (b)(5). "(D) CERTAIN SERVICE DISREGARDED.—

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"(i) IN GENERAL.—In the case of a participant to whom this subparagraph applies, only the applicable percentage of the years of service before such individual became a participant shall be t a k e n into account in computing the c u r r e n t liability of the plan. "(ii) APPLICABLE PERCENTAGE.—For purposes of this

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subparagraph, the applicable percentage shall be determined as follows: ^ >„^,.

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1131

 PUBLIC LAW 100-203—DEC. 22, 1987 "If the years of participation are: 1 2 3 4 5 or more "(iii) PARTICIPANTS TO WHOM

101 STAT. 1330-337 The applicable percentage is: 20 40 60 80 100.

SUBPARAGRAPH AP-

,,^s.,

PLIES.—This subparagraph shall apply to any participant who, at the time of becoming a participant— ,"(I) has not accrued any other benefit under any ,., defined benefit plan (whether or not terminated) maintained by the employer or a member of the ... •^ same controlled group of which the employer is a member, and ., J "(II) who first becomes a participant under the plan in a plan year beginning after December 31, 1987. "(8) OTHER DEFINITIONS.—For purposes of this subsection— "(A) UNFUNDED CURRENT LIABILITY.—The term 'unfunded current liability' means, with respect to any plan year, the excess (if any) of— R. "(i) the current liability under the plan, over "(ii) value of the plan's assets determined under subsection (c)(2) reduced by any credit balance in the funding standard account. "(B) FUNDED CURRENT LIABILITY PERCENTAGE.—The term 'funded current liability percentage' means, with respect to "(i) the amount determined under subparagraph (A)(ii), is of "(ii) the current liability under the plan. "(C) CONTROLLED GROUP.—The term 'controlled group' means any group treated as a single employer under • subsections (b), (c), (m), and (o) of section 414. "(D) ADJUSTMENTS TO PREVENT OMISSIONS AND DUPLICA-
 * , any plan year, the percentage which—

i-

TIONS.—The Secretary shall provide such adjustments in the unfunded old liability amount, the unfunded new liability amount, the unpredictable contingent event amount, the current payment amount, and any other charges or credits under this section as are necessary to avoid duplication or omission of any factors in the determination of such amounts, charges, or credits." (2) CONFORMING AMENDMENT.—Paragraph (2) of section 412(b)

of the 1986 Code is amended by adding at the end thereof the 26 USC 412. following new sentence: ^^ "For additional requirements in the case of plans other than multiemployer plans, see subsection (1)." (b) AMENDMENTS TO ERISA.—

(1) IN GENERAL.—Section 302 of ERISA (29 U.S.C. 1082) is amended by redesignating subsection (d) as subsection (e) and by inserting after subsection (c) the following new subsection: "(d) ADDITIONAL FUNDING REQUIREMENTS FOR PLANS WHICH ARE NOT MULTIEMPLOYER PLANS.— '•• Incorrect indention in copy.

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1132

 101 STAT. 1330-338

PUBLIC LAW 100-203—DEC. 22, 1987

I

"(1) IN GENERAL.—In the case of a defined benefit plan (other " than a multiemployer plan) which has an unfunded current liability for any plan year, the amount charged to the funding standard account for such plan year shall be increased by the sum of— "(A) the excess (if any) of— "(i) the deficit reduction contribution determined under paragraph (2) for such plan year, over "(ii) the sum of the charges for such plan year under subparagraphs (B) (other than clauses (iv) and (v) thereof), (C), and (D) of subsection (b)(2), reduced by the sum of the credits for such plan year under subparagraph (B)(i) of subsection (b)(8), plus "(B) the unpredictable contingent event amount (if any) for such plan year. .; Such increase shall not exceed the amount necessary to increase the funded current liability percentage to 100 percent. "(2) DEFICIT REDUCTION CONTRIBUTION.—For purposes of paragraph (1), the deficit reduction contribution determined under this paragraph for any plan year is the sum of— "(A) the unfunded old liability amount, plus "(B) the unfunded new liability amount. "(3) UNFUNDED OLD LiABiliTY AMOUNT.—For purposes of this "]. subsection— "(A) IN GENERAL.—The unfunded old liability amount with respect to any plan for any plan year is the amount necessary to amortize the unfunded old liability under the plan in equal annual installments over a period of 18 plan years (beginning with the 1st plan year beginning after ^ " December 31, 1988). "(B) UNFUNDED OLD LIABILITY.—The term 'unfunded old liability' means the unfunded current liability of the plan 5 ^ ^s of the beginning of the 1st plan year beginning after '^ December 31, 1987 (determined without regard to any plan amendment increasing liabilities adopted after October 16, • 1987). "(C) SPECIAL RULES FOR BENEFIT INCREASES UNDER EXISTING COLLECTIVE BARGAINING AGREEMENTS.—

' '^

• "\

"(i) IN GENERAL.—In the case of a plan maintained pursuant to 1 or more collective bargaining agreements between employee representatives and the employer ratified before October 17, 1987, the unfunded old liability amount with respect to such plan for any plan year shall be increased by the amount necessary to amortize the unfunded existing benefit increase liability in equal annual installments over a period of 18 plan years beginning with— "(I) the plan year in which the benefit increase with respect to such liability occurs, or "(II) if the taxpayer elects, the 1st plan year beginning after December 31, 1988. "(ii)

»• •'.

UNFUNDED EXISTING BENEFIT INCREASE LIABIL-

ITIES.—For purposes of clause (i), the unfunded existing benefit increase liability means, with respect to any benefit increase under the agreements described in clause (i) which takes effect during or after the 1st plan

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1133

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-339

year beginning after December 31, 1987, the unfunded current liability determined— "(I) by taking into account only liabilities attributable to such benefit increase, and "(II) by reducing the amount determined under paragraph (8)(A)(ii) by the current liability determined without regard to such benefit increase, "(iii) EXTENSIONS, MODIFICATIONS, ETC. NOT TAKEN INTO ACCOUNT.—For purposes of this subparagraph, any extension, amendment, or other modification of an agreement after October 16, 1987, shall not be taken into account. "(4) UNFUNDED NEW LIABILITY AMOUNT.—For purposes of this subsection— "(A) IN GENERAL.—The unfunded new liability amount with respect to any plan for any plan year is the applicable percentage of the unfunded new liability. "(B) UNFUNDED NEW LIABILITY.—The term 'unfunded new liability' means the unfunded current liability of the plan for the plan year determined without regard to— "(i) the unamortized portion of the unfunded old liability, and "(ii) the liability with respect to any unpredictable contingent event benefits (without regard to whether the event has occurred). "(C) APPLICABLE PERCENTAGE.—The term 'applicable percentage' means, with respect to any plan year, 30 percent, reduced by the product of— "(i).25 multiplied by "(ii) the number of percentage points (if any) by which the funded current liability percentage exceeds 35 percent. "(5) UNPREDICTABLE CONTINGENT EVENT AMOUNT.—

,

"(A) IN GENERAL.—The unpredictable contingent event amount with respect to a plan for any plan year is an amount equal to the greater of— "(i) the applicable percentage of the product of— "(I) 100 percent, reduced (but not below zero) by > the funded current liability percentage for the plan year, multiplied by "(II) the amount of unpredictable contingent Contracts. event benefits paid during the plan year, including (except as provided by the Secretary of the Treasury) any payment for the purchase of an annuity contract for a participant or beneficiary with respect to such benefits, or "(ii) the amount which would be determined for the plan year if the unpredictable contingent event benefit liabilities were amortized in equal annual installments over 7 plan years (beginning with the plan year in which such event occurs). "(B) A P P U C A B L E PERCENTAGE.—

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1134

 101 STAT. 1330-340

PUBLIC LAW 100-203—DEC. 22, 1987

"In the case of plan years beginning in: ,,..f, ., 1989 and 1990 ' ' ^ ' 1991 1992 ' ' 1993 1994 1995 1996 ' • 1997 1998 1999 ,.;., 2000 2001 and thereafter •.!'.>.

-. * . . '

The applicable percentage is: 5 10 15 20 30 40 50 60 70 80 90 100.

"(C) PARAGRAPH N O T TO APPLY TO EXISTING BENEFITS.—

This paragraph shall not apply to unpredictable contingent event benefits (and liabilities a t t r i b u t a b l e thereto) for '; >;.: ^ which the event occurred before October 17, 1987. "(D) SPECIAL RULE FOR FIRST YEAR OF AMORTIZATION.—

Unless the employer elects otherwise, the a m o u n t determined under subparagraph (A) for the plan year i n which the event occurs shall be equal to 150 percent of the a m o u n t determined under subparagraph (A)(i). The a m o u n t under subparagraph (A)(ii) for subsequent plan years in the amortization period shall be adjusted in the m a n n e r provided by the Secretary of the Treasury to reflect the application of t h i s subparagraph.

'. '•'->•''

"(6) SPECIAL RULES FOR SMALL P L A N S. — "(A) P L A N S W I T H lOO OR FEWER

PARTICIPANTS.—This

subsection shall not apply to any plan for any plan year if on each day during the preceding plan year such plan h a d no more than 100 participants. •:.•>: >;-.,

mi

f:!^^'^

"(B) P L A N S W I T H MORE THAN lOO BUT NOT MORE T H A N 1 5 0

PARTICIPANTS.—In the case of a plan to which subparagraph (A) does not apply and which on each d a y during the preceding plan year h a d no more than 150 participants, the a m o u n t of the increase under paragraph (1) for such plan year shall be equal to the product of— "(i) such increase determined without regard to this subparagraph, multiplied by • "(ii) 2 percent for the highest n u m b e r of participants in excess of 100 on any such day. "(C) A G G R E G A T I O N OF P L A N S. — For purposes of t h i s p a r a -

g r a p h, all defined benefit plans m a i n t a i n e d by the s a m e employer (or any m e m b e r of such employer's controlled group) shall be t r e a t e d as 1 plan, b u t only employees of such employer or m e m b e r shall be t a k e n into account. '(7) C U R R E N T LIABILITY.—For purposes of t h i s subsection—

"(A) IN GENERAL.—The term ' c u r r e n t liability' means all liabilities to participants and the i r beneficiaries under the plan. "(B) T R E A T M E N TO F UNPREDICTABLE CONTINGENT EVENT BENEFITS.—

"(i) IN GENERAL.—For purposes of subparagraph (A), any unpredictable contingent event benefit shall not be t a k e n into account until the event on which the benefit is contingent occurs. "(ii) UNPREDICTABLE CONTINGENT EVENT BENEFIT.—

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1135

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-341

The term 'unpredictable contingent event benefit* means any benefit contingent on an event other than— "(I) age, service, compensation, death, or disability, or "(II) an event which is reasonably and reliably predictable (as determined by the Secretary of the Treasury). "(C) INTEREST RATES USED.—The rate of interest used to determine current liability shall be the rate of interest used under subsection (b)(5).

t ^

"(D) CERTAIN SERVICE DISREGARDED.—

"(i) IN GENERAL.—In the case of a participant to whom this subparagraph applies, only the applicable percentage of the years of service before such individual became a participant shall be taken into account in computing the current liability of the plan. "(ii) APPLICABLE PERCENTAGE.—For purposes of this subparagraph, the applicable percentage shall be determined as follows: "If the years of participation are: 1 2 8 4 5 or more "(iii) PARTICIPANTS TO WHOM

The applicable percentage is: 20 40 60 80 100. SUBPARAGRAPH AP-

PLIES.—This subparagraph shall apply to any participant who, at the time of becoming a participant— "(I) has not accrued any other benefit under any defined benefit plan (whether or not terminated) maintained by the employer or a member of the same controlled group of which the employer is a member, and "(II) who first becomes a participant under the plan in a plan year beginning after December 31, 1987. "(8) OTHER DEFINITIONS.—For purposes of this subsection— "(A) UNFUNDED CURRENT LIABILITY.—The term 'unfunded current liability' means, with respect to any plan year, the excess (if any) of— "(i) the current liability under the plan, over "(ii) value of the plan's assets determined under subsection (c)(2) reduced by any credit balance in the funding standard account. "(B) FUNDED CURRENT LIABILITY PERCENTAGE.—The term 'funded current liability percentage' means, with respect to any plan year, the percentage which— "(i) the amount determined under subparagraph (A)(ii), is of "(ii) the current liability under the plan. "(C) CONTROLLED GROUP.—The term 'controlled group' means any group treated as a single employer under subsections^"^ (b), (c), (m), and (o) of section 414 of the Internal Revenue Code of 1986. "(D) ADJUSTMENTS TO PREVENT OMISSIONS AND DUPLICA-

TIONS.—The Secretary of the Treasury shall provide such adjustments in the unfunded old liability amount, the un'Copy read "subsection".

•

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.,. •'

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1136

 101 STAT. 1330-342

PUBLIC LAW 100-203—DEC. 22, 1987

funded new liability amount, the unpredictable contingent event amount, the current payment amount, and any other ~"-'S,. charges or credits under this section as are necessary to avoid duplication or omission of any factors in the determination of such amounts, charges, or credits." 26 USC 412 note. (c) REVISION OF VALUATION REGULATIONS.—Effective with respect to plan years beginning after December 31, 1987, the provisions of the regulations prescribed under section 412(c)(2) of the 1986 Code which permit asset valuations to be based on a range between 85 percent and 115 percent of average value shall have no force and effect with respect to plans other than multiemployer plans (as defined in section 414(f) of the 1986 Code). The Secretary of the Treasury or his delegate shall amend such regulations to carry out the purposes of the preceding sentence. Regulations. 26 USC 412.

(d) VALUATION OF BONDS.— (1) AMENDMENT TO 1986 CODE.—Subparagraph (B) of section

412(c)(2) of the 1986 Code is amended by adding at the end thereof the following new sentence: "In the case of a plan other than a multiemployer plan, this subparagraph shall not apply, but the Secretary may by regulations provide that the value of any dedicated bond portfolio of such plan shall be determined by using the interest rate under subsection (b)(5)." (2) AMENDMENT TO ERISA.—Subparagraph (B) of section 302(c)(2) of ERISA is amended by adding at the end thereof the following new sentence: "In the case of a plan other than a multiemployer plan, this subparagraph shall not apply, but the Secretary of the Treasury may by regulations provide that the value of any dedicated bond portfolio of such plan shall be determined by using the interest rate under subsection (b)(5)."

Regulations. 29 USC 1082

26 USC 412 note.

(e) EFFECTIVE DATE.—

(1) IN GENERAL.—Except as provided in this subsection, the amendments made by this section shall apply with respect to plan years beginning after December 31, 1988. (2) SUBSECTIONS (C) AND (D).—The amendments made by subsections (c) and (d) shall apply with respect to years beginning after December 31, 1987. (3) SPECIAL RULE FOR STEEL COMPANIES.—

(A) IN GENERAL.—For any plan year beginning before January 1, 1994, any increase in the funding standard account under section 412(1) of the 1986 Code or section 302(d) of ERISA (as added by this section) with respect to any steel employee plan shall not exceed the sum of— (i) the required percentage of the current liability under such plan, plus (ii) the amount determined under subparagraph (C)(i) for such plan year. (B) REQUIRED PERCENTAGE.—For purposes of subpara-

I

graph (A), the term "required percentage" means, with respect to any plan year, the excess (if any) of— (i) the sum of— ^ (I) the funded current liability percentage as of the beginning of the 1st plan year beginning after December 31, 1988 (determined without regard to any plan amendment adopted after June 30, 1987), plus (II) 1 percentage point for the plan year for which the determination under this paragraph is being made and for each prior plan year beginning after December 31, 1988, over

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text:
Author:Mary Alice Murray

Works

 * (tr.) Carlo Collodi: The Story of a Puppet or The Adventures of Pinocchio (1892)

title: Author:Mary Alice Murray


text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1137

 PUBLIC LAW 100-203—DEC. 22, 1987 ,-

I

101 STAT. 1330-343

^

(ii) the funded current liability percentage as of the beginning of the plan year for which such determination is being made. (C) SPECIAL RULES FOR CONTINGENT EVENTS.—In the case of any unpredictable contingent event benefit with respect to which the event on which such benefits are contingent occurs after December 17, 1987— (i) AMORTIZATION AMOUNT.—For purposes of subpara-

graph (A)(ii), the amount determined under this clause for any plan year is the amount which would be determined if the unpredictable contingent event benefit liability were amortized in equal annual installments over 10 plan years 0)eginning with the plan year in which such event occurs). (ii) BENEFIT AND CONTRIBUTIONS NOT TAKEN INTO AC-

COUNT.—For purposes of subparagraph (B), in determining the funded current liability percentage for any plan year, there shall not be taken into account— ' (I) the unpredictable contingent event benefit liability, or (II) any amount contributed to the plan which is ^' attributable to clause (i). (D) STEEL EMPLOYEE PLAN.—For purposes of this paragraph, the term "steel employee plan" means any plan if— (i) such plan is maintained by a steel company, and (ii) substantially all of the employees covered by such plan are employees of such company. (E) OTHER DEFINITIONS.—For purposes of this paragraph— (i) STEEL COMPANY.—The term "steel company" means any corporation described in section 80603) of the Steel Import Stabilization Act. (ii) OTHER DEFINITIONS.—The terms "current liability", "funded current liability percentage", and "unpredictable contingent event benefit" have the meanings given such terms by section 412(1) of the 1986 Code (as added by this section). (F)95 SPECIAL RULE.—The provisions of this paragraph shall apply in the case of a company which was originally incorporated on April 25, 1927, in Michigan and reincorporated on June 3, 1968, in Delaware in the same manner sis if such company were a steel company.

\

•i

SEC. 9304. TIME FOR MAKING CONTRIBUTIONS. (a) PERIOD DURING WHICH CONTRIBUTIONS MAY B E MADE AFTER CLOSE OF YEAR.— (1) AMENDMENT TO 1986 CODE.—Paragraph (10) of section

412(c) of the 1986 Code (relating to time when certain contributions deemed made) is amended to read as follows: "(10) TIME WHEN CERTAIN CONTRIBUTIONS DEEMED MADE.—For

purposes of this section— "(A) PLANS OTHER THAN MULTIEMPLOYER PLANS.—In the

J case of a plan other than a multiemployer plan, any contributions for a plan year made by gm employer during the period— »» Copy read "(E)"

26 USC 412.

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/1138

 101 STAT. 1330-344

PUBLIC LAW 100-203—DEC. 22, 1987

,.....,,;

"(i) beginning on the day after the last day of such plan year, and "(ii) ending on the day which is SVz months after the close of the plan year, shall be deemed to have been made on such last day. "(B) MULTIEMPLOYER PLANS.—In the case of a multiemployer plan, any contributions for a plan year made by an employer after the Isist day of such plan year, but not later than two and one-half months after such day, shall be deemed to have been made on such leist day. For purposes of this subparagraph, such two and one-half month period may be extended for not more than six months under regulations prescribed by the Secretary." (2) AMENDMENT TO ERISA.—Paragraph (10) of section 302(c) of ERISA (relating to time when certain contributions deemed made) (29 U.S.C. 1082(c)(10))»» is amended to read as follows: "(10) For purposes of this section—

"(A) In the case of a plan other than a multiemployer plan, any contributions for a plan year made by an employer during sf ri the period— "(i) beginning on the day after the last day of such plan year, and "(ii) ending on the date which is 8V2 months after the close of the plan year, i shall be deemed to have been made on such last day. "(B) In the case of a multiemployer plan, any contributions for a plan year made by an employer after the last day of such plan year, but not later than two and one-half months after such day, shall be deemed to have been made on such last day. Regulations. For purposes of this subparagraph, such two and one-half month period may be extended for not more than six months under regulations prescribed by the Secretary of the Treasury." 26 USC 412 note. (3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to plan years beginning after December 31, 1987. (b) QUARTERLY ESTIMATED PAYMENTS REQUIRED.— (1) AMENDMENT TO 1986 CODE.—Section 412 of the 1986 Code

26 USC 412.

(relating to minimum funding standard) is amended by adding at the end thereof the following new subsection: "(m) QUARTERLY CONTRIBUTIONS REQUIRED.—

,..^J, y i

"(1) IN GENERAL.—If a plan (other than a multiemployer plan) fails to pay the full amount of a required installment for any plan year, then the rate of interest charged to the funding ' standard account under subsection (b)(5) with respect to the amount of the underpayment for the period of the underpayment shall be equal to the greater of— ji; i. «^^j -jYg percent of the Federal mid-term rate (as in effect under section 1274 for the 1st month of such plan year), or lij I u(g) ^j^g j. ^ ^ ^jjjgj. subsection (b)(5). "(2) AMOUNT OF UNDERPAYMENT, PERIOD OF UNDERPAYMENT.—

For purposes of paragraph (1)— ^;^; "(A) AMOUNT.—The amount of the underpayment shall " " * be the excess of— "(i) the required installment, over »• Copy read "1082(c)(10)".

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1139

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-345

.^.j. /. -•

"(ii) the amount (if any) of the installment contributed to or under the plan on or before the due date for the installment. "(B) PERIOD OF UNDERPAYMENT.—The period for which interest is charged under this subsection with regard to any portion of the underpayment shall run from the due date for the installment to the date on which such portion is contributed to or under the plan (determined without regard to subsection (c)(10)). "(C) ORDER OF CREDITING CONTRIBUTIONS.—For purposes of subparagraph (A)(ii), contributions shall be credited against unpaid required installments in the order in which such installments are required to be paid.

"(8) NUMBER OF REQUIRED INSTALLMENTS; DUE DATES.—For

purposes of this subsection— "(A) PAYABLE IN 4 INSTALLMENTS.—There shall be 4 required installments for each plan year. "(B) TIME FOR PAYMENT OF INSTALLMENTS.— ''= "In the case of the following required installments: The due date is: 1st April 15 2nd July 15 3rd October 15 4th January 15 of the following year.

"(4) AMOUNT OF REQUIRED INSTALLMENT.—For purposes of this subsection— "(A) IN GENERAL.—The amount of any required installment shall be the applicable percentage of the required annual payment. "(B)

REQUIRED

ANNUAL

PAYMENT.—For

purposes

of

subparagraph (A), the term 'required annual payment' means the lesser of— "(i) 90 percent of the amount required to be contributed to or under the plan by the employer for the plan year under section 412 (without regard to any waiver 'l^'; under subsection (c) thereof), or "(ii) 100 percent of the amount so required for the preceding plan year. Clause (ii) shall not apply if the preceding plan year was not a year of 12 months. "(C) APPLICABLE PERCENTAGE.—For purposes of subpara-

graph (A), the applicable percentage shall be determined in accordance with the following table: "For plan years beginning in: 1989 1990 1991 1992 and thereafter

The applicable percentage is: 6.25 12.5 18.75 25.

"(D) SPECIAL RULES FOR UNPREDICTABLE CONTINGENT EVENT BENEFITS.—In the case of a plan with any unpredict-

able contingent event benefit liabilities— "(i) such liabilities shall not be taken into account in computing the required annual payment under subparagraph (B), and

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1140

 101 STAT. 1330-346

• '

PUBLIC LAW 100-203—DEC. 22, 1987 "(ii) each required installment shall be increased by the greater of— "(I) the amount of benefits described in subsection (l)(5)(A)(i) paid during the 3-month period preceding the month in which the due date for such installment occurs, or "(ID 25 percent of the amount determined under subsection (l)(5)(A)(ii) for the plan year.

"(5) FISCAL YEARS AND SHORT YEARS.— "(A) FISCAL YEARS.—In applying this

subsection to a plan year beginning on any date other than January 1, there shall be substituted for the months specified in this subsection, the months which correspond thereto.

- vi ^

"(B) SHORT PLAN YEAR.—This subsection shall be applied

to plan years of less than 12 months in accordance with regulations prescribed by the Secretary." (2) AMENDMENT TO ERISA.—Section 302 of ERISA (29 U.S.C. 1082) is amended by redesignating subsection (e) as subsection (f) and by inserting after subsection (d) the following new subsection: "(e) QUARTERLY CONTRIBUTIONS REQUIRED.—

"(1) IN GENERAL.—If a plan (other than a multiemployer plan) fails to pay the full amount of a required installment for any plan year, then the rate of interest charged to the funding standard account under subsection (b)(5) with respect to the amount of the underpa3mient for the period of the underpayment shall be equal to the greater of— "(A) 175 percent of the Federal mid-term rate (as in effect under section 1274 of the Internal Revenue Code of 1986 for the 1st month of such plan year), or "(B) the rate under subsection (b)(5). "(2) AMOUNT OF UNDERPAYMENT, PERIOD OF UNDERPAYMENT.—

For purposes of paragraph (1)— "(A) AMOUNT.—The amount of the underpa3rment shall be the excess of— "(i) the required installment, over "(ii) the amount (if any) of the installment contrib,,. uted to or under the plan on or before the due date for the installment. "(B) PERIOD OF UNDERPAYMENT.—The period for which any interest is charged under this subsection with respect to any portion of the underpayment shall run from the due date for the installment to the date on which such portion is contributed to or under the plan (determined without regard to subsection (c)(10)). " (C) ORDER OF CREDITING CONTRIBUTIONS.—For purposes of subparagraph (A)(ii), contributions shall be credited against unpaid required installments in the order in which such installments are required to be paid. "(3) NUMBER OF REQUIRED INSTALLMENTS; DUE DATES.—For

purposes of this subsection— "(A) PAYABLE IN 4 INSTALLMENTS.—There shall be 4 required installments for each plan year. "(B) TIME FOR PAYMENT OF INSTALLMENTS.—

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Page:United States Statutes at Large Volume 101 Part 2.djvu/1141

 PUBLIC LAW 100-203—DEC. 22, 1987

V

"In the case of the followin|r required installments: 1st 2nd 3rd 4th

101 STAT. 1330-347

The due date is: April 15 July 15 October 15 January 15 of the following year.

,,

"(4) AMOUNT OF REQUIRED INSTALLMENT.—For purposes of this subsection— "(A) IN GENERAL.—The amount of any required installment shall be the applicable percentage of the required annual payment. "(B)

REQUIRED

ANNUAL

PAYMENT.—For

purposes

of

subparagraph (A), the term 'required annual payment' means the lesser of— "(i) 90 percent of the amount required to be contributed to or under the plan by the employer for the plan year under section 412 of the Internal Revenue Code of 1986 (without regard to any waiver under subsection (c) thereof), or "(ii) 100 percent of the amount so required for the preceding plan year. Clause (ii) shall not apply if the preceding plan year was not a year of 12 months. "(C) APPLICABLE PERCENTAGE.—For purposes of subpara-

graph (A), the applicable percentage shall be determined in accordance with the following table:

. -:>

"For plan years beginning in: 1989 1990 1991 -^ 1992 and thereaRer

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"(D) SPECIAL RULES FOR UNPREDICTABLE CONTINGENT EVENT BENEFITS.—In the case of a plan with any unpredict-

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The applicable percentage is: 6.25 12.5 18.75 25.

able contingent event benefit liabilities— "(i) such liabilities shall not be taken into account in computing the required annual payment under subparagraph (B), and "(ii) each required installment shall be increased by the greater of— "(I) the amount of benefits described in subsection (d)(5)(A)(i) paid during the 3-month period preceding the month in which the due date for such installment occurs, or "(II) 25 percent of the amount determined under subsection (d)(5)(A)(ii) for the plan year. "(5) FISCAL YEARS AND SHORT YEARS.— "(A) FISCAL YEARS.—In applying this

subsection to a plan year beginning on any date other than January 1, there shall be substituted for the months specified in this subsection, the months which correspond thereto. "(B) SHORT PLAN YEAR.—This section shall be applied to Regulations. plan years of less than 12 months in accordance with regulations prescribed by the Secretary of the Treasury." (3) EFFECTIVE DATE.—The amendments made by this subsec- 26 USC 412 note. tion shall apply with respect to plan years beginning after 1988. (c) INCREASE IN EXCISE TAX FROM 5 PERCENT TO 10 PERCENT.—

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