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22 as much as it might be deplored, is not an uncommon occurrence throughout the country in the midst of civilization and enlightenment.” Great excitement ensued in the settlements near the Ute Reservation; and the trial of Mr. Berry, the United States Indian agent, was vociferously demanded on the ground that he, in confiding Jackson to the escort of three white men and one Indian, had deliberately betrayed him into the hands of Indians eager to avenge the death of one of their people. Mr. Berry was subsequently arrested by the United States marshal, and taken before the United States district court at Denver, where his case is now pending. Before his arrest he showed great skill and influence over the Indians, in keeping them quiet and preventing further disturbance on their part. It is to be hoped that the State and local authorities in Colorado will use their best judgment and endeavors to allay the excitement existing in that State, so as to restrain evil-disposed persons from invading the Indian reservation and provoking collisions with the Indians, which would be especially deplorable at a time when the so-called Ute problem is on the point of successful solution by just and peaceable agencies and in accordance with an agreement successfully concluded.

The case of the Poncas has continued to be a subject of public as well as private attention, on account of the hardships suffered by that tribe in consequence of its removal from Dakota to the Indian Territory. I have repeatedly in my reports expressed the opinion that the Poncas had a serious grievance on account of that removal, and that a generous indemnity was due to them. I am free to say, also, that a clear knowledge of their case at the time of their removal, which happened at the very beginning of the present administration, would have induced me then to oppose it to the extent of the discretion permitted by existing law to this department in such cases. The question how that grievance was to be redressed admitted of two different answers. One was that they should be returned to Dakota and the other that their condition be made as comfortable and prosperous as possible on their new location in the Indian Territory. There were several reasons against their return to Dakota. Their lands in Dakota had, by the treaty of 1868, been ceded to the Sioux, who had been their old enemies, and whose hostile incursions in, years past had called forth among the Poncas themselves a desire to get out of their way by removal. The great problem in the management of Indian affairs at that time was to insure the general pacification of the Sioux tribes, in all over 30,000 souls strong. The Sioux occupied the Ponca Reserve for some time in 1877, shortly after the removal of the Poncas to the Indian Territory had taken place. Two large Sioux bands, numbering over 13,000, are now permanently located in the southern part of the great Sioux Reservation, at a distance from the old Ponca Reserve, but within comparatively easy reach. The Poncas could


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100 STAT. 227

day before the qualifying event for that employee, is a beneficiary under the plan— "(I) as the spouse of the covered employee, or "(II) as the dependent child of the employee, "(ii) SPECIAL RULE FOR TERMINATIONS AND REDUCED

EMPLOYMENT.—In the case of a qualifying event described in paragraph (3)(B), the term 'qualified beneficiary' includes the covered employee. "(C) PLAN ADMINISTRATOR.—The term 'plan administrator' has the meaning given the term 'administrator' by section 3(16)(A) of the Employee Retirement Income Security Act of 1974.". 29 USC 1002. (d) CONFORMING AMENDMENT.—Paragraph (1) of section 162(i) is 26 USC 162. amended by striking out "GENERAL RULE ' in the heading thereof and inserting in lieu thereof "COVERAGE RELATING TO END STAGE RENAL DISEASE". (e) EFFECTIVE DATES.— (1) GENERAL RULE.—The amendments made by this section

26 USC 106 note.

shall apply to plan years beginning on or after July 1, 1986. (2) SPECIAL RULE FOR COLLECTIVE BARGAINING AGREEMENTS.—

In the case of a group health plan maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers ratified before the date of the enactment of this Act, the amendments made by this section shall not apply to plan years beginning before the later of— (A) the date on which the last of the collective bargaining agreements relating to the plan terminates (determined without regard to any extension thereof agreed to after the date of the enactment of this Act), or (B) January 1, 1987. For purposes of subparagraph (A), any plan amendment made pursuant to a collective bargaining agreement relating to the plan which amends the plan solely to conform to any requirement added by this section shall not be treated as a termination of such collective bargaining agreement. SEC. 10002. TEMPORARY EXTENSION OF COVERAGE AT GROUP RATES FOR CERTAIN EMPLOYEES AND FAMILY MEMBERS (ERISA AMENDMENTS).

(a) IN GENERAL.—Subtitle B of title I of the Employee Retirement Income Security Act of 1974 is amended by adding at the end thereof the following new part: "PART 6—CONTINUATION COVERAGE UNDER GROUP HEALTH PLANS "SEC. 601. PLANS MUST PROVIDE CONTINUATION COVERAGE TO CERTAIN

INDIVIDUALS.

"(a) IN GENERAL.—The plan sponsor of each group health plan shall provide, in accordance with this part, that each qualified beneficiary who would lose coverage under the plan as a result of a qualifying event is entitled, under the plan, to elect, within the election period, continuation coverage under the plan. "(b) EXCEPTION FOR CERTAIN PLANS.—Subsection (a) shall not apply to any group health plan for any calendar year if all employers maintaining such plan normally employed fewer than 20 employees on a typical business day during the preceding calendar

29 USC 1161.

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license: Creative Commons - Attribution Share-Alike - https://creativecommons.org/licenses/by-sa/4.0/


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Page:United States Statutes at Large Volume 100 Part 1.djvu/264

 100 STAT. 228 26 USC 52.

29 USC 1162.

42 USC 1395.

PUBLIC LAW 99-272—APR. 7, 1986

year. Under regulations, rules similar to the rules of subsections (a) and (b) of section 52 of the Internal Revenue Code of 1954 (relating to employers under common control) shall apply for purposes of this subsection. "SEC. 602. CONTINUATION COVERAGE.

"For purposes of section 601, the term 'continuation coverage' means coverage under the plan which meets the following requirements: "(1) TYPE OF BENEFIT COVERAGE.—The coverage must consist of coverage which, as of the time the coverage is being provided, is identical to the coverage provided under the plan to similarly situated beneficiaries under the plan with respect to whom a qualifying event has not occurred. "(2) PERIOD OF COVERAGE,—The coverage must extend for at least the period beginning on the date of the qualifying event and ending not earlier than the earliest of the following: "(A) MAXIMUM PERIOD.—In the case of— "(i) a qualifying event described in section 603(2) (relating to terminations and reduced hours), the date which is 18 months after the date of the qualifying event, and "(ii) any qualifying event not described in clause (i), the date which is 36 months after the date of the qualifying event. "(B) END OF PLAN.—The date on which the employer ceases to provide any group health plan to any employee. "(C) FAILURE TO PAY PREMIUM.—The date on which coverage ceases under the plan by reason of a failure to make timely payment of any premium required under the plan with respect to the qualified beneficiary. "(D) REEMPLOYMENT OR MEDICARE ELIGIBILITY.—The date on which the qualified beneficiary first becomes, after the date of the election— "(i) a covered employee under any other group health plan, or "(ii) entitled to benefits under title XVIII of the Social Security Act. "(E) REMARRIAGE OF SPOUSE.—In the case of an individual who is a qualified beneficiary by reason of being the spouse of a covered employee, the date on which the beneficiary remarries and becomes covered under a group health plan. "(3) PREMIUM REQUIREMENTS.—The plan may require payment of a premium for any period of continuation coverage, except that such premium— "(A) shall not exceed 102 percent of the applicable premium for such period, and "(B) may, at the election of the payor, be made in monthly installments. If an election is made after the qualifying event, the plan shall permit payment for continuation coverage during the period preceding the election to be made within 45 days of the date of the election. "(4) No REQUIREMENT OF INSURABILITY.—The coverage may

not be conditioned upon, or discriminate on the basis of lack of, evidence of insurability.

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 PUBLIC LAW 99-272—APR. 7, 1986

100 STAT. 229

"(5) CONVERSION OPTION.—In the case of a qualified beneficiary whose period of continuation coverage expires under paragraph (2)(A), the plan must, during the 180-day period ending on such expiration date, provide to the qualified beneficiary the option of enrollment under a conversion health plan otherwise generally available under the plan. "SEC. 603. QUALIFYING EVENT.

29 USC 1163.

"For purposes of this part, the term 'qualifying event' means, with respect to any covered employee, any of the following events which, but for the continuation coverage required under this part, would result in the loss of coverage of a qualified beneficiary: "(1) The death of the covered employee. "(2) The termination (other than by reason of such employee's gross misconduct), or reduction of hours, of the covered employee's employment. "(3) 'The divorce or legal separation of the covered employee from the employee's spouse. "(4) The covered employee becoming entitled to benefits under title XVIII of the Social Security Act. 42 USC 1395. "(5) A dependent child ceasing to be a dependent child under the generally applicable requirements of the plan. "SEC. 604. APPLICABLE PREMIUM.

29 USC 1164.

"For purposes of this part— "(1) IN GENERAL.—The term 'applicable premium' means, with respect to any period of continuation coverage of qualified beneficiaries, the cost to the plan for such period of the coverage for similarly situated beneficiaries with respect to whom a qualifying event has not occurred (without regard to whether such cost is paid by the employer or employee). "(2) SPECIAL RULE FOR SELF-INSURED PLANS.—To the extent that a plan is a self-insured plan— "(A) IN GENERAL.—Except as provided in subparagraph (B), the applicable premium for any period of continuation coverage of qualified beneficiaries shall be equal to a reasonable estimate of the cost of providing coverage for such period for similarly situated beneficiaries which— "(i) is determined on an actuarial basis, and "(ii) takes into account such factors as the Secretary may prescribe in regulations. "(B)

DETERMINATION ON BASIS OF PAST COST.—If

an

administrator elects to have this subparagraph apply, the applicable premium for any period of continuation coverage of qualified beneficiaries shall be equal to— "(i) the cost to the plan for similarly situated beneficiaries for the same period occurring during the preceding determination period under paragraph (3), adjusted by "(ii) the percentage increase or decrease in the implicit price deflator of the gross national product (calculated by the Department of Commerce and published in the Survey of Current Business) for the 12-month period ending on the last day of the sixth month of such preceding determination period. "(C) SUBPARAGRAPH (B) NOT TO APPLY WHERE SIGNIFICANT

CHANGE.—An administrator may not elect to have subpara-

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 100 STAT. 230

PUBLIC LAW 99-272—APR. 7, 1986 graph (B) apply in any case in which there is any significant difference, between the determination period and the preceding determination period, in coverage under, or in employees covered by, the plan. The determination under the preceding sentence for any determination period shall be made at the same time as the determination under paragraph (3). "(3) DETERMINATION PERIOD.—The determination of any ap-

plicable premium shall be made for a period of 12 months and shall be made before the beginning of such period. 29 USC 1165.

"SEC. 605. ELECTION.

"For purposes of this part— "(1) ELECTION PERIOD.—The term 'election period' means the period which— "(A) begins not later than the date on which coverage terminates under the plan by reason of a qualifying event, "(B) is of at least 60 days' duration, and "(C) ends not earlier than 60 days after the later of— "(i) the date described in subparagraph (A), or "(ii) in the case of any qualified beneficiary who receives notice under section 606(4), the date of such notice. "(2) EFFECT OF ELECTION ON OTHER BENEFICIARIES.—Except as

otherwise specified in an election, any election by a qualified beneficiary described in subparagraph (A)(i) or (B) of section 607(3) shall be deemed to include an election of continuation coverage on behalf of any other qualified beneficiary who would lose coverage under the plan by reason of the qualifying event. 29 USC 1166.

"SEC. 606. NOTICE REQUIREMENTS.

"In accordance with regulations prescribed by the Secretary— "(1) the group health plan shall provide, at the time of commencement of coverage under the plan, written notice to each covered employee and spouse of the employee (if any) of the rights provided under this subsection, "(2) the employer of an employee under a plan must notify the administrator of a qualifying event described in paragraph (1), (2), or (4) of section 603 within 30 days of the date of the qualifying event, "(3) each covered employee or qualified beneficiary is responsible for notifying the administrator of the occurrence of any qualifying event described in paragraph (3) or (5) of section 603, and "(4) the administrator shall notify— "(A) in the case of a qualifying event described in paragraph (1), (2), or (4) of section 603, any qualified beneficiary with respect to such event, and "(B) in the case of a qualifying event described in paragraph (3) or (5) of section 603 where the covered employee notifies the administrator under paragraph (3), any qualified beneficiary with respect to such event, of such beneficiary's rights under this subsection. For purposes of paragraph (4), any notification shall be made within 14 days of the date on which the administrator is notified under paragraph (2) or (3), whichever is applicable, and any such notification to an individual who is a qualified beneficiary as the spouse of

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Page:United States Statutes at Large Volume 100 Part 1.djvu/267

 PUBLIC LAW 99-272—APR. 7, 1986

100 STAT. 231

the covered employee shall be treated as notification to all other qualified beneficiaries residing with such spouse at the time such notification is made. "SEC. 607. DEFINITIONS. 29 USC 1167. "For purposes of this part— "(1) GROUP HEALTH PLAN.—The term 'group health plan' means an employee welfare benefit plan that is a group health plan (within the meaning of section 162(i)(3) of the Internal Revenue Code of 1954). 26 USC 162. "(2) COVERED EMPLOYEE.—The term 'covered employee' means an individual who is (or was) provided coverage under a group health plan by virtue of the individual's employment or previous employment with an employer. "(3) QUALIFIED BENEFICIARY.—

"(A) IN GENERAL.—The term 'qualified beneficiary' means, with respect to a covered employee under a group health plan, any other individual who, on the day before the qualifying event for that employee, is a beneficiary under the plan— "(i) as the spouse of the covered employee, or "(ii) as the dependent child of the employee. "(B)

SPECIAL RULE FOR TERMINATIONS AND REDUCED

EMPLOYMENT.—In the case of a qualifying event described in section 603(2), the term 'qualified beneficiary' includes the covered employee. "SEC. 608. REGULATIONS. 29 USC 1168. "The Secretary may prescribe regulations to carry out the provisions of this part.". (b) PENALTY FOR FAILURE TO PROVIDE NOTICE.—Section 502(c) of such Act (29 U.S.C. 1132(c)) is amended by inserting after "Any administrator" the following: "(1) who fails to meet the requirements of paragraph (1) or (4) of section 606 with respect to a participant or beneficiary, or (2)". (c) CLERICAL AMENDMENTS.—The table of contents in section 1 of such Act is amended by inserting after the item relating to section 514 the following new items: "PART 6—CONTINUATION COVERAGE UNDER GROUP HEALTH PLANS

"Sec. "Sec. "Sec. "Sec. "Sec. "Sec. "Sec. "Sec.

601. Plans must provide continuation coverage to certain individuals. 602. Continuation coverage. 603. Qualifying event. 604. Applicable premium. 605. Election. 606. Notice requirements. 607. Definitions. 608. Regulations.".

(d) EFFECTIVE D A T E S. —

29 USC

(1) GENERAL RULE.—The amendments made by this section ^°^^shall apply to plan years beginning on or after July 1, 1986. (2) SPECIAL RULE FOR COLLECTIVE BARGAINING AGREEMENTS.—

In the case of a group health plan maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers ratified before the date of the enactment of this Act, the amendments made by this section shall not apply to plan years beginning before the later of—

1161

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Page:United States Statutes at Large Volume 100 Part 1.djvu/268

 100 STAT. 232

29 USC 1166 note. Ante, p. 231. Ante, p. 227. Ante, p. 230.

PUBLIC LAW 99-272—APR. 7, 1986

(A) the date on which the last of the collective bargaining agreements relating to the plan terminates (determined without regard to any extension thereof agreed to after the date of the enactment of this Act), or (B) January 1, 1987. For purposes of subparagraph (A), any plan amendment made pursuant to a collective bargaining agreement relating to the plan which amends the plan solely to conform to any requirement added by this section shall not be treated as a termination of such collective bargaining agreement. (e) NOTIFICATION TO COVERED EMPLOYEES.—At the time that the amendments made by this section apply to a group health plan (within the meaning of section 607(1) of the Employee Retirement Income Security Act of 1974), the plan shall notify each covered employee, and spouse of the employee (if any), who is covered under the plan at that time of the continuation coverage required under part 6 of subtitle B of title I of such Act. The notice furnished under this subsection is in lieu of notice that may otherwise be required under section 606(1) of such Act with respect to such individuals. SEC.

10003. CONTINUATION OF HEALTH INSURANCE FOR ST.4TE AND LOCAL EMPLOYEES WHO LOST EMPLOYMENT-RELATED COVERAGE (PUBLIC HEALTH SERVICE ACT AMENDMENTS).

(a) IN GENERAL.—The Public Health Service Act is amended by adding at the end the following new title: "TITLE XXII—REQUIREMENTS FOR CERTAIN GROUP HEALTH PLANS FOR CERTAIN STATE AND LOCAL EMPLOYEES 42 USC 300bb-l.

District of Columbia.

26 USC 52.

"SEC. 220L STATE AND LOCAL GOVERNMENTAL GROUP HEALTH PLANS MUST PROVIDE CONTINUATION COVERAGE TO CERTAIN INDIVIDUALS.

"(a) IN GENERAL.—In accordance with regulations which the Secretary shall prescribe, each group health plan that is maintained by any State that receives funds under this Act, by any political subdivision of such a State, or by any agency or instrumentality of such a State or political subdivision, shall provide, in accordance with this title, that each qualified beneficiary who would lose coverage under the plan as a result of a qualifying event is entitled, under the plan, to elect, within the election period, continuation coverage under the plan. "(b) EXCEPTION FOR CERTAIN PLANS.—Subsection (a) shall not apply to— "(1) any group health plan for any calendar year if all employers maintaining such plan normally employed fewer than 20 employees on a typical business day during the preceding calendar year, or "(2) any group health plan maintained for employees by the government of the District of Columbia or any territory or possession of the United States or any agency or instrumentality. Under regulations, rules similar to the rules of subsections (a) and (b) of section 52 of the Internal Revenue Code of 1954 (relating to employers under common control) shall apply for purposes of paragraph (1).

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Page:United States Statutes at Large Volume 100 Part 1.djvu/269

 PUBLIC LAW 99-272—APR. 7, 1986

100 STAT. 233

"SEC. 2202. CONTINUATION COVERAGE.

42 USC 300bb-2.

"For purposes of section 2201, the term 'continuation coverage' means coverage under the plan which meets the following requirements: "(1) TYPE OF BENEFIT COVERAGE.—The coverage must consist of coverage which, as of the time the coverage is being provided, is identical to the coverage provided under the plan to similarly situated beneficiaries under the plan with respect to whom a qualifying event has not occurred. "(2) PERIOD OF COVERAGE.—The coverage must extend for at least the period beginning on the date of the qualifying event and ending not earlier than the earliest of the following: "(A) MAXIMUM PERIOD.—In the case of— "(i) a qualifying event described in section 2203(2) (relating to terminations and reduced hours), the date which is 18 months after the date of the qualifying event, and "(ii) any qualifying event not described in clause (i), the date which is 36 months after the date of the qualifying event. "(B) END OF PLAN.—The date on which the employer ceases to provide any group health plan to any employee. "(C) FAILURE TO PAY PREMIUM.—The date on which coverage ceases under the plan by reason of a failure to make timely payment of any premium required under the plan with respect to the qualified beneficiary. "(D) REEMPLOYMENT OR MEDICARE ELIGIBILITY.—The date on which the qualified beneficiary first becomes, after the date of the election— "(i) a covered employee under any other group health plan, or "(ii) entitled to benefits under title XVIII of the Social Security Act. 42 USC 1395. "(E) REMARRIAGE OF SPOUSE.—In the case of an individual who is a qualified beneficiary by reason of being the spouse of a covered employee, the date on which the beneficiary remarries and becomes covered under a group health plan. "(3) PREMIUM REQUIREMENTS.—The plan may require payment of a premium for any period of continuation coverage, except that such premium— "(A) shall not exceed 102 percent of the applicable premium for such period, and "(B) may, at the election of the payor, be made in monthly installments. If an election is made after the qualifying event, the plan shall permit payment for continuation coverage during the period preceding the election to be made within 45 days of the date of the election. "(4) No REQUIREMENT OF INSURABILITY.—The coverage

may

not be conditioned upon, or discriminate on the basis of lack of, evidence of insurability. "(5) CONVERSION OPTION.—In the case of a qualified beneficiary whose period of continuation coverage expires under paragraph (2)(A), the plan must, during the 180-day period ending on such expiration date, provide to the qualified bene-

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Page:United States Statutes at Large Volume 100 Part 1.djvu/270

 100 STAT. 234

PUBLIC LAW 99-272—APR. 7, 1986 ficiary the option of enrollment under a conversion health plan otherwise generally available under the plan.

42 USC 300bb-3.

"SEC. 2203. QUALIFYING EVENT.

42 USC 1395c. ehildren and y°"*^-

"For purposes of this title; the term 'qualifying event' means, with respect to any covered employee, any of the following events which, but for the continuation coverage required under this title, would result in the loss of coverage of a qualified beneficiary: "(1) The death of the covered employee. "(2) The termination (other than by reason of such employee's gross misconduct), or reduction of hours, of the covered employee's employment. ' (3) The divorce or legal separation of the covered employee from- the employee's spouse. "(4) The covered employee becoming entitled to benefits under title XVIII of the Social Security Act. "(5) A dependent child ceasing to be a dependent child under the generally applicable requirements of the plan.

42 USC 300bb-4.

"SEC. 2204. APPLICABLE PREMIUM.

"For purposes of this title— "(1) IN GENERAL.—The term 'applicable premium' means, with respect to any period of continuation coverage of qualified beneficiaries, the cost to the plan for such period of the coverage for similarly situated beneficiaries with respect to whom a qualifying event has not occurred (without regard to whether such cost is paid by the employer or employee). "(2) SPECIAL RULE FOR SELF-INSURED PLANS.—To the extent that a plan is a self-insured plan— "(A) IN GENERAL.—Except as provided in subparagraph (B), the applicable premium for any period of continuation coverage of qualified beneficiaries shall be equal to a reasonable estimate of the cost of providing coverage for such period for similarly situated beneficiaries which— "(i) is determined on an actuarial basis, and "(ii) takes into account such factors as the Secretary may prescribe in regulations. "(B) DETERMINATION ON BASIS OF PAST COST.—If a plan administrator elects to have this subparagraph apply, the applicable premium for any period of continuation coverage of qualified beneficiaries shall be equal to— "(i) the cost to the plan for similarly situated beneficiaries for the same period occurring during the preceding determination period under paragraph (3), adjusted by (ii) the percentage increase or decrease in the implicit price deflator of the gross national product (calculated by the Department of Commerce and published in the Survey of Current Business) for the 12-month period ending on the last day of the sixth month of such preceding determination period. "(C) SUBPARAGRAPH (B) NOT TO APPLY WHERE SIGNIFICANT

CHANGE.—A plan administrator may not elect to have subparagraph (B) apply in any case in which there is any significant difference, between the determination period and the preceding determination period, in coverage under, or in employees covered by, the plan. The determination

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Page:U.S. Department of the Interior Annual Report 1880.djvu/25

 not be moved back to their old lands without a previous agreement with the Sioux. While it is said that the latter are now more favorably disposed toward the Poncas, and while the conduct of that branch of the Sioux Nation is now very satisfactory, yet it is also a matter of experience that old grudges among Indians, although smoothed over, are apt to be revived by reckless individuals among them, in which case the Poncas, numbering only a few hundreds, would be at a great disadvantage compared with their powerful neighbors. Moreover, Congress had granted neither authority nor money for the removal of the Poncas back to Dakota. I should willingly have recommended the passage of a law and appropriation to that end, there being no interest nor any pride of opinion in the Department that could possibly have prevented such a step—for in the very first report rendered by me after the removal of the Poncas, and after I had become fully aware of the whole character of the transaction, the wrong done to them was frankly acknowledged—had there not been other considerations of superior weight against it. The principal injury suffered by them immediately after their removal, by disease and the death of many of their people, could not be repaired. When they were once settled in the Indian Territory upon land which is acknowledged to be excellent for agricultural and herding purposes, and had made new beginnings in civilized pursuits and the promotion of their well-being, those beginnings would have been destroyed by a second removal, and the whole operation would have had to be repeated. It is but natural that frequent removals of an Indian tribe should have a disastrous effect upon their advancement in civilization and prosperity.

According to the latest reports, their condition is now very much improved. How much better they are situated in a sanitary point of view than immediately after their arrival in the Indian Territory appears from the fact that, according to the returns for the year just passed, there were during that year eleven deaths and fifteen births in the tribe, so that the Poncas have been actually increasing in numbers. Most of them are now living in houses, are tilling the soil, and have been provided with stock cattle for herding. They have school facilities for the education of their children. Their progress would have been greater had they not been kept in a state of restlessness by reports from the outside that they would soon be returned to Dakota, and that therefore they need not apply themselves to the improvement of their condition on the soil they occupy in the Indian Territory. Instead of benefiting them, such reports have evidently inflicted upon them an injury. Nothing would have been more apt to improve their health, raise their spirits, and promote their well-being than steady and fruitful work. That the Poncas feel this themselves appears from a petition which on the 29th of October they addressed to the Commissioner of Indian Affairs, and in which they say “that their young men are unsettled while they think they have a right to their land in Dakota,” and that “their tribe will not be finally settled until they have a title to their


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 PUBLIC LAW 99-272—APR. 7, 1986

100 STAT. 235

under the preceding sentence for any determination period shall be made at the same time as the determination under paragraph (3). "(3) DETERMINATION PERIOD.—The determination of any ap-

plicable premium shall be made for a period of 12 months and shall be made before the beginning of such period. "SEC. 2205. ELECTION.

42 USC 300bb-5.

"For purposes of this title— "(1) ELECTION PERIOD.—The term 'election period' means the period which— "(A) begins not later than the date on which coverage terminates under the plan by reason of a qualifying event, "(B) is of at least 60 days' duration, and "(C) ends not earlier than 60 days after the later of^ "(i) the date described in subparagraph (A), or "(ii) in the case of any qualified beneficiary who receives notice under section 2206(4), the date of such notice. "(2) EFFECT OF ELECTION ON OTHER BENEFICIARIES.—Except as

otherwise specified in an election, any election by a qualified beneficiary described in subparagraph (A)(i) or (B) of section 2208(3) shall be deemed to include an election of continuation coverage on behalf of any other qualified beneficiary who would lose coverage under the plan by reason of the qualifying event. "SEC. 2206. NOTICE REQUIREMENTS.

"In accordance with regulations prescribed by the Secretary— "(1) the group health plan shall provide, at the time of commencement of coverage under the plan, written notice to each covered employee and spouse of the employee (if any) of the rights provided under this subsection, "(2) the employer of an employee under a plan must notify the plan administrator of a qualifying event described in paragraph (1), (2), or (4) of section 2203 within 30 days of the date of the qualifying event, "(3) each covered employee or qualified beneficiary is responsible for notifying the plan administrator of the occurrence of any qualifying event described in paragraph (3) or (5) of section 2203, and "(4) the plan administrator shall notify— "(A) in the case of a qualifying event described in paragraph (1), (2), or (4) of section 2203, any qualified beneficiary with respect to such event, and "(B) in the case of a qualifying event described in paragraph (3) or (5) of section 2203 where the covered employee notifies the plan administrator under paragraph (3), any qualified beneficiary with respect to such event, of such beneficiary's rights under this subsection. For purposes of paragraph (4), any notification shall be made within 14 days of the date on which the plan administrator is notified under paragraph (2) or (3), whichever is applicable, and any such notification to an individual who is a qualified beneficiary as the spouse of the covered employee shall be treated as notification to all other qualified beneficiaries residing with such spouse at the time such notification is made.

42 USC 300bb-6.

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 100 STAT. 236 42 USC 300bb-7.

PUBLIC LAW 99-272—APR. 7, 1986 "SEC. 2207. ENFORCEMENT.

"Any individual who is aggrieved by the failure of a State, political subdivision, or agency or instrumentality thereof, to comply with the requirements of this title may bring an action for appropriate equitable relief. 42 USC 300bb-8. Health and medical care. 26 USC 162.

"SEC. 2208. DEFINITIONS.

"For purposes of this title— "(1) GROUP HEALTH PLAN.—The term 'group health plan' has the meaning given such term in section 162(i)(3) of the Internal Revenue Code of 1954. "(2) COVERED EMPLOYEE.—The term 'covered employee' means an individual who is (or was) provided coverage under a group health plan by virtue of the individual's employment or previous employment with an employer. "(3) QUALIFIED BENEFICIARY.—

"(A) IN GENERAL.—The term 'qualified beneficiary' means, with respect to a covered employee under a group health plan, any other individual who, on the day before the qualifying event for that employee, is a beneficiary under the plan— "(i) as the spouse of the covered employee, or "(ii) as the dependent child of the employee. "(B)

29 USC 1002. 42 USC 300bb-l note.

SPECIAL RULE FOR TERMINATIONS AND REDUCED

EMPLOYMENT.—In the case of a qualifying event described in section 2203(2), the term 'qualified beneficiary' includes the covered employee. "(4) PLAN ADMINISTRATOR.—The term 'plan administrator' has the meaning given the term 'administrator' by section 3(16)(A) of the Employee Retirement Income Security Act of 1974." (b) EFFECTIVE DATES.— (1) GENERAL RULE.—The

amendments made by this section shall apply to plan years beginning on or after July 1, 1986. (2) SPECIAL RULE FOR COLLECTIVE BARGAINING AGREEMENTS.—

42 USC 300bb-6 note.

Ante, p. 232.

In the case of a group health plan maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers ratified before the date of the enactment of this Act, the amendments made by this section shall not apply to plan years beginning before the later of— (A) the date on which the last of the collective bargaining agreements relating to the plan terminates (determined without regard to any extension thereof agreed to after the date of the enactment of this Act), or (B) January 1, 1987. For purposes of subparagraph (A), any plan amendment made pursuant to a collective bargaining agreement relating to the plan which amends the plan solely to conform to any requirement added by this section shall not be treated as a termination of such collective bargaining agreement. (c) NOTIFICATION TO COVERED EMPLOYEES.—At the time that the amendments made by this section apply to a group health plan (covered under section 2201 of the Public Health Service Act), the plan shall notify each covered employee, and spouse of the employee (if any), who is covered under the plan at that time of the continuation coverage required under title XXII of such Act. The notice furnished under this subsection is in lieu of notice that may other-

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Page:United States Statutes at Large Volume 100 Part 1.djvu/273

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100 STAT. 237

wise be required under section 2206(1) of such Act with respect to such individuals.

TITLE XI—SINGLE-EMPLOYER PLAN TER- smgie MINATION INSURANCE SYSTEM AMEND- p^Z%i.n MENTS icTo"f%r SEC. 11001. SHORT TITLE AND TABLE OF CONTENTS.

This title may be cited as "Single-Employer Pension Plan Amendments Act of 1986". Sec. Sec. Sec. Sec. Sec. Sec. Sec.

11001. 11002. 11003. 11004. 11005. 11006. 11007.

Sec. Sec. Sec. Sec.

11008. 11009. 11010. 11011.

Sec. 11012. Sec. 11013. Sec. 11014. Sec. 11015. Sec. Sec. Sec. Sec.

11016. 11017. 11018. 11019.

29 USC 1001 note.

TABLE OF CONTENTS Short title and table of contents. Findings and declaration of policy. Amendment of the Employee Retirement Income Security Act of 1974. Definitions. Single-employer plan termination insurance premiums. Notice of significant reduction in benefit accruals. General requirements relating to termination of single-employer plans by plan administrators. Standard termination of single-employer plans. Distress termination of single-employer plans. Termination proceedings; duties of the corporation. Amendments to liability provisions; liabilities relating to benefit commitments in excess of benefits guaranteed by the corporation. Distribution to participants and beneficiaries of liability payments to section 4049 trust. Treatment of transactions to evade liability; effect of corporate reorganization. Enforcement authority relating to terminations of single-employer plans. Provisions relating to waivers of minimum funding standard and extensions of amortization period. Conforming, clarifying, technical, and miscellaneous amendments. Studies. Limitation on regulations. Effective date of title; temporary procedures.

SEC. 11002. FINDINGS AND DECLARATION OF POLICY.

(a) FINDINGS.—The Congress finds that— (1) single-employer defined benefit pension plans have a substantial impact on interstate commerce and are affected with a national interest; (2) the continued well-being and retirement income security of millions of workers, retirees, and their dependents are directly affected by such plans; (3) the existence of a sound termination insurance system is fundamental to the retirement income security of participants and beneficiaries of such plans; and (4) the current termination insurance system in some instances encourages employers to terminate pension plans, evade their obligations to pay benefits, and shift unfunded pension liabilities onto the termination insurance system and the other premium-payers. (b) ADDITIONAL FINDINGS.—The Congress further finds that modification of the current termination insurance system and an increase in the insurance premium for single-employer defined benefit pension plans— (1) is desirable to increase the likelihood that full benefits will be paid to participants and beneficiaries of such plans;

29 USC 1001b.

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 100 STAT. 238

Commerce and trade.

PUBLIC LAW 99-272—APR. 7, 1986

(2) is desirable to provide for the transfer of liabilities to the termination insurance system only in cases of severe hardship; (3) is necessary to maintain the premium costs of such system at a reasonable level; and (4) is necessary to finance properly current funding deficiencies and future obligations of the single-employer pension plan termination insurance system. (c) DECLARATION OF POLICY.—It is hereby declared to be the policy of this title CD to foster and facilitate interstate commerce; (2) to encourage the maintenance and growth of single-employer defined benefit pension plans; (3) to increase the likelihood that participants and beneficiaries under single-employer defined benefit pension plans will receive their full benefits; (4) to provide for the transfer of unfunded pension liabilities onto the single-employer pension plan termination insurance system only in cases of severe hardship; (5) to maintain the premium costs of such system at a reasonable level; and (6) to assure the prudent financing of current funding deficiencies and future obligations of the single-employer pension plan termination insurance system by increasing termination insurance premiums. SEC. 11003. AMENDMENT OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. Whenever in this title an amendment or repeal is expressed in terms of an amendment to or repeal of a section or other provision, the reference is to a section or other provision of the Employee Retirement Income Security Act of 1974, unless otherwise specified. SEC. 11004. DEFINITIONS. (a) IN GENERAL.—Section 4001(a) (29 U.S.C. 1301(a)) is amended— (1) by striking out paragraph (2) and inserting in lieu thereof the following new paragraph: "(2) 'substantial employer', for any plan year of a singleemployer plan, means one or more persons— "(A) who are contributing sponsors of the plan in such plan year, "(B) who, at any time during such plan year, are members of the same controlled group, and "(C) whose required contributions to the plan for each plan year constituting one of—"(i) the two immediately preceding plan years, or "(ii) the first two of the three immediately preceding plan years, total an amount greater than or equal to 10 percent of all contributions required to be paid to or under the plan for such plan year;"; (2) in paragraph (11), by striking out "and"; (3) in paragraph (12), by striking out "corporation." and inserting in lieu thereof "corporation;'; and (4) by adding after paragraph (12) the following new paragraphs: "(13) 'contributing sponsor', of a single-employer plan, means a person—

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"(A) who is responsible, in connection with such plan, for meeting the funding requirements under section 302 of this Act or section 412 of the Internal Revenue Code of 1954, or "(B) who is a member of the controlled group of a person described in subparagraph (A), has been responsible for meeting such funding requirements, and has employed a significant number (as may be defined in regulations of the corporation) of participants under such plan while such person was so responsible; "(14) in the case of a single-employer plan— "(A) 'controlled group' means, in connection with any person, a group consisting of such person and all other persons under common control with such person; and "(B) the determination of whether two or more persons are under 'common control' shall be made under regulations of the corporation which are consistent and coextensive with regulations prescribed for similar purposes by the Secretary of the Treasury under subsections (b) and (c) of section 414 of the Internal Revenue Code of 1954; "(15) 'single-employer plan' means any defined benefit plan (as defined in section 3(35)) which is not a multiemployer plan; "(16) 'benefit commitments', to a participant or beneficiary as of any date under a single-employer plan, means all benefits provided by the plan with respect to the participant or beneficiary which— "(A) are guaranteed under section 4022, "(B) would be guaranteed under section 4022, but for the operation of subsection 4022(b), or "(C) constitute— "(i) early retirement supplements or subsidies, or "(ii) plant closing benefits, irrespective of whether any such supplements, subsidies, or benefits are benefits guaranteed under section 4022, if the participant or beneficiary has satisfied, as of such date, all of the conditions required of him or her under the provisions of the plan to establish entitlement to the benefits, except for the submission of a formal application, retirement, completion of a required waiting period subsequent to application for benefits, or designation of a beneficiary; "(17) 'amount of unfunded guaranteed benefits', of a participant or beneficiary as of any date under a single-employer plan, means an amount equal to the excess of— "(A) the actuarial present value (determined as of such date on the basis of assumptions prescribed by the corporation for purposes of section 4044) of the benefits of the participant or beneficiary under the plan which are guaranteed under section 4022, over "(B) the current value (as of such date) of the assets of the plan which are required to be allocated to those benefits under section 4044; "(18) 'amount of unfunded benefit commitments', of a participant or beneficiary as of any date under a single-employer plan, means an amount equal to the excess of— "(A) the actuarial present value (determined as of such date on the basis of assumptions prescribed by the corporation for purposes of section 4044) of the benefit commitments to the participant or beneficiary under the plan, over

29 USC 1112. 26 USC 412.

26 USC 414. 29 USC 1002.

29 USC 1322.

29 USC 1344.

29 USC 1344.

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 100 STAT. 240

29 USC 1344.

29 USC 1322. 29 USC 1002.

29 USC 1056.

PUBLIC LAW 99-272—APR. 7, 1986 "(B) the current value (as of such date) of the assets of the plan which are required to be allocated to those benefit commitments under section 4044; "(19) 'outstanding amount of benefit commitments', of a participant or beneficiary under a terminated single-employer plan, means the excess of— "(A) the actuarial present value (determined as of the termination date on the basis of assumptions prescribed by the corporation for purposes of section 4044) of the benefit commitments to such participant or beneficiary under the plan, over "(B) the actuarial present value (determined as of such date on the basis of assumptions prescribed by the corporation for purposes of section 4044) of the benefits of such participant or beneficiary which are guaranteed under section 4022 or to which assets of the plan are required to be allocated under section 4044; "(20) 'person' has the meaning set forth in section 3(9); "(21) 'affected party' means, with respect to a plan— "(A) each participant in the plan, "(B) each beneficiary under the plan who is a beneficiary of a deceased participant or who is an alternate payee (within the meaning of section 206(d)(3)(K)) under an applicable qualified domestic relations order (within the meaning of section 206(d)(3)(B)(i)), "(C) each employee organization representing participants in the plan, and "(D) the corporation, except that, in connection with any notice required to be provided to the affected party, if an affected party has designated, in writing, a person to receive such notice on behalf of the affected party, any reference to the affected party shall be construed to refer to such person.", (b) TECHNICAL CORRECTION OF ERROR IN MULTIEMPLOYER PENSION

29 USC 1301.

29 USC 1301.

26 USC 412.

PLAN AMENDMENTS ACT OF 1980.—Section 4001 is further amended

by striking out the amendments made by section 402(a)(1)(F) of the Multiemployer Pension Plan Amendments Act of 1980 (94 Stat. 1297) (adding new paragraphs after a subsection (c)(1)), and, in lieu thereof, in subsection (b), by inserting "(1)" after "(b)" and by adding at the end of such subsection the following new paragraph: "(2) For purposes of subtitle E— "(A) except as otherwise provided in subtitle E, contributions or other payments shall be considered made under a plan for a plan year if they are made within the period prescribed under section 412(c)(10) of the Internal Revenue Code of 1954 (determined, in the case of a terminated plan, as if the plan had continued beyond the termination date), and - "(B) the term 'Secretary of the Treasury' means the Secretary ^ of the Treasury or such Secretary's delegate.". SEC. 11005. SINGLE-EMPLOYER PLAN TERMINATION INSURANCE PREMIUMS. (a) PREMIUM INCREASE.— (1) GENERAL RULE.—Section

4006(a)(3)(A)(i) (29 U.S.C. 1306(a)(3)(A)(i)) is amended by striking out "for plan years beginning after December 31, 1977, an amount equal to $2.60" and

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inserting in lieu thereof "for plan years beginning after December 31, 1985, an amount equal to $8.50". (2) CONFORMING AMENDMENT WITH RESPECT TO PLAN YEARS

AFTER 1977.—Section 4006(c)(1) (29 U.S.C. 1306(c)(1)) is amended by striking out subparagraph (A) and inserting in lieu thereof the following new subparagraph: "(A) in the case of each plan which was not a multiemployer plan in a plan year— "(i) with respect to each plan year beginning before January 1, 1978, an amount equal to $1 for each individual who was a participant in such plan during the plan year, and "(ii) with respect to each plan year beginning after December 31, 1977, an amount equal to $2.60 for each individual who was a participant in such plan during the plan year, and", (b) INCORPORATION OF CERTAIN P'ORMER PROVISIONS IN LIEU OF CROSS REFERENCE THERETO.—Section 4006(a) (29 U.S.C. 1306(a)) is

amended— (1) in paragraph (1), by striking out the last sentence; and (2) by adding at the end thereof the following new paragraph: "(6)(A) In carrying out its authority under paragraph (1) to establish premium rates and bases for basic benefits guaranteed under section 4022 with respect to single-employer plans, the corporation 29 USC 1322. shall establish such rates and bases in coverage schedules in accordance with the provisions of this paragraph. "(B) The corporation may establish annual premiums for singleemployer plans composed of the sum of— "(i) a charge based on a rate applicable to the excess, if any, of the present value of the basic benefits of the plan which are guaranteed over the value of the assets of the plan, not in excess of 0.1 percent, and "(ii) an additional charge based on a rate applicable to the present value of the basic benefits of the plan which are guaranteed. The rate for the additional charge referred to in clause (ii) shall be set by the corporation for every year at a level which the corporation estimates will yield total revenue approximately equal to the total revenue to be derived by the corporation from the charges referred to in clause (i) of this subparagraph. "(C) The corporation may establish annual premiums for singleemployer plans based on— "(i) the number of participants in a plan, but such premium rates shall not exceed the rates described in paragraph (3), "(ii) unfunded basic benefits guaranteed under this title, but such premium rates shall not exceed the limitations applicable to charges referred to in subparagraph (B)(i), or "(iii) total guaranteed basic benefits, but such premium rates shall not exceed the rates for additional charges referred to in subparagraph (B)(ii). If the corporation uses two or more of the rate bases described in this subparagraph, the premium rates shall be designed to produce approximately equal amounts of aggregate premium revenue from each of the rate bases used. "(D) For purposes of this paragraph, the corporation shall by regulation define the terms 'value of assets' and 'present value of the benefits of the plan which are guaranteed' in a manner consist-

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 100 STAT. 242

PUBLIC LAW 99-272—APR. 7, 1986 ent with the purposes of this title and the provisions of this section.". (c) APPROVAL BY JOINT RESOLUTION OF RECOMMENDATIONS OF THE PENSION BENEFIT GUARANTY CORPORATION.—Title IV is amended as

follows: (1) The last sentence of subsection (a)(2) of section 4006 (29 U.S.C. 1306(a)(2)) is amended by striking out "the Congress approves such revised schedule by a concurrent resolution" and inserting in lieu thereof "a joint resolution approving such revised schedule is enacted". (2) Subsection (a)(4) of section 4006 (29 U.S.C. 1306(a)(4)) is amended by striking out "approval by the Congress" and inserting in lieu thereof "the enactment of a joint resolution". (3) Subsection (b)(3) of section 4006 (29 U.S.C. 1306(b)(3)) is amended by striking out "concurrent" and inserting in lieu thereof "joint", by striking out "That the Congress favors the" and inserting in lieu thereof "The", and by inserting "is hereby approved" before the period preceding the quotation marks. (4) Subsection (f)(2)(B) of section 4022A (29 U.S.C. 1322a(f)(2)(B)) is amended by striking out "Congress by concurrent resolution" and inserting in lieu thereof "the enactment of a joint resolution". (5) Subsection (f)(2)(C) of section 4022A (29 U.S.C. 1322a(f)(2)(C)) is amended by striking out "approved" and inserting in lieu thereof "so enacted". (6) Subsection (f)(3)(B) of section 4022A (29 U.S.C. 1322a(f)(3)(A)) is amended by striking out "Congress by a concurrent resolution" and inserting in lieu thereof "enactment of a joint resolution". (7) Subsection (f)(4)(A) of section 4022A (29 U.S.C. 1322a(f)(4)(A)) is amended by striking out "concurrent" and inserting in lieu thereof "joint". (8) Subsection (f)(4)(B) of section 4022A (29 U.S.C. 1322a(f)(4)(B)) is amended by striking out "concurrent" each place it appears and inserting in lieu thereof "joint", by striking out "That the Congress favors the" and inserting in lieu thereof "The", and by inserting "is hereby approved" immediately before the period preceding the quotation marks. (9) Subsection (f)(4)(C) of section 4022A (29 U.S.C. 1322a(f)(4)(C)) is amended by striking out "concurrent" and inserting in lieu thereof "joint". (10) Subsection (g)(4)(A)(ii) of section 4022A (29 U.S.C. 1322a(g)(4)(A)(ii)) is amended by striking out "concurrent" and inserting in lieu thereof "joint", and by striking out "adopted" and inserting in lieu thereof "enacted". (11) Subsection (g)(4)(B) of section 4022A (29 U.S.C. 1322a(g)(4)(B)) is amended by striking out "concurrent" each place it appears and inserting in lieu thereof "joint", by striking out "That the Congress disapproves the" and inserting in lieu thereof "The", and by inserting "is hereby disapproved" immediately before the period preceding the quotation marks. (12) Subsection (g)(4)(D) of section 4022A (29 U.S.C. 1322a(g)(4)(D)) is amended by striking out "concurrent" and inserting in lieu thereof "joint". 42 USC 1306

note.

(d) EFFECTIVE DATES.—

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24 present reservation and have relinquished all right to their Dakota land.” They therefore earnestly request that they be given an opportunity for “signing away all their right to all lands in Dakota and to obtain a title to their present reservation.” They desire to visit Washington for the purpose of “convincing the government that it is their intention to remain where they are, and requesting the aid of the government in obtaining more teams, wagons, harness, and tools with which to work their land.” This petition is signed by all the chiefs and headmen of the Ponca tribe, and it would seem to show that the Poncas themselves understand their own interests better than they are understood by some of their sincere but ill-advised friends. Their request “that the chiefs of the Ponca tribe be permitted to visit Washington the coming winter” for the purpose indicated in their petition has been complied with, and it is hoped that arrangements generally satisfactory will be arrived at.

But there is another reason why I could not conscientiously recommend the return of the Poncas to their old reserve in Dakota, and that reason is perhaps less appreciated by the general public than it is by those who bear the responsibility for the whole management of Indian affairs at large, and who have to take care of the welfare not of the Poncas alone, but of all the Indian tribes, of whom the Poncas form only a very small part.

It is a well-known fact that the Indian Territory is exposed to constant invasions on the part of white people who strive to possess themselves of certain unoccupied lands therein, which are held for Indian settlement in the future. To defeat such invasions, and to maintain the integrity of the Indian Territory, has been a subject of constant solicitude by the government; it required the greatest watchfulness and energy on the part of officers and troops of the United States in arresting and turning back the invaders, to prevent the success of those lawless attempts. Whatever the ultimate fate of the Indian Territory may be, it would be a great disaster to the Indians now inhabiting it, were the stream of immigration, which is constantly threatening to break its barriers, permitted to enter before the Indians are settled there in severalty, with such individual title to their lands as will stand under the protection of the laws and courts of the country in the same light and with the same security as the land titles of white people. The tracts in the Indian Territory mainly coveted by those who strive to enter without warrant of law, are held against intruders on the ground that they are reserved for Indian occupation according to the original intention. What the consequence would be if, just at the time when the struggle for the integrity of the Indian Territory is on our hands, the government itself organized an emigration of Indians from the Indian Territory, and from the vicinity of the same lands that are held for Indian settlement against intruders, it is easy to conjecture. If the Poncas were removed back to Dakota, nothing is more certain than that this very fact would make other Northern Indians who have been taken into the Indian Territory, restless with a desire to follow their example, such as the Northern Cheyennes,


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(1) GENERAL RULE.—Except as provided in paragraph (2), the

amendments made by this section shall be effective for plan years commencing after December 31, 1985. (2) SPECIAL RULE.—The amendments made by subsection (b) shall be effective as of the date of the enactment of the Multiemployer Pension Plan Amendments Act of 1980. 29 USC lOOl (e) TRANSITIONAL RULE.— note. (1) NOTICE OF PREMIUM INCREASE.—Not later than 30 days ^ote^^ ^ after the date of the enactment of this Act, the Pension Benefit Guaranty Corporation shall send a notice to the plan administrator of each single-employer plan affected by the premium increase established by the amendment made by subsection (a)(1). Such notice shall describe such increase and the requirements of this subsection. (2) DUE DATE FOR UNPAID PREMIUMS.—With respect to any

plan year beginning during the period beginning on January 1, 1986, and ending 30 days after the date of the enactment of this Act, any unpaid amount of such premium increase shall be due and payable no later than the earlier of 60 days after the date of the enactment of this Act or 30 days after the date on which the notice required by paragraph (1) is sent, except that in no event shall the amount of the premium increase established under the amendment made by subsection (a)(1) be due and payable for a plan year earlier than the date on which premiums for the plan would have been due for such plan year had this Act not been enacted. (3) ENFORCEMENT.—For purposes of enforcement, the requirements of paragraphs (1) and (2) shall be considered to be requirements of sections 4006 and 4007 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1306 and 1307). SEC. 11006. NOTICE OF SIGNIFICANT REDUCTION IN BENEFIT ACCRUALS.

(a) IN GENERAL.—Section 204 (29 U.S.C. 1054) is amended— (1) by redesignating subsection (h) as subsection (i); and (2) by inserting after subsection (g) the following new subsection: "(h) A single-employer plan may not be amended so as to provide for a significant reduction in the rate of future benefit accrual, unless, after adoption of the plan amendment and not less than 15 days before the effective date of the plan amendment, the plan administrator provides a written notice, setting forth the plan amendment and its effective date, to— "(1) each participant in the plan, "(2) each beneficiary who is an alternate payee (within the meaning of section 206(d)(3)(K)) under an applicable qualified 29 USC 1056. domestic relations order (within the meaning of section 206(d)(3)(B)(i)), and "(3) each employee organization representing participants in the plan, except that such notice shall instead be provided to a person designated, in writing, to receive such notice on behalf of any person referred to in paragraph (1), (2), or (3).". (b) EFFECTIVE DATE.—The amendments made by subsection (a) 29 USC 1054 shall apply with respect to plan amendments adopted on or after note. January 1, 1986, except that, in the case of plan amendments adopted on or after January 1, 1986, and on or before the date of the enactment of this Act, the requirements of section 204(h) of the

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PUBLIC LAW 99-272—APR. 7, 1986

Employee Retirement Income Security Act of 1974 (as added by this section) shall be treated as met if the written notice required under such section 204(h) is provided before 60 days after the date of the enactment of this Act. SEC. 11007. GENERAL REQUIREMENTS RELATING TO TERMINATION OF SINGLE-EMPLOYER PLANS BY PLAN ADMINISTRATORS.

(a) IN GENERAL.—Section 4041 (29 U.S.C. 1341) is amended by striking out subsections (a) through (c) and inserting in lieu thereof the following: "SEC. 4041. (a) GENERAL RULES GOVERNING SINGLE-EMPLOYER PLAN TERMINATIONS.— "(1) EXCLUSIVE MEANS OF PLAN TERMINATION.—Except in the

Post, p. 253.

case of a termination for which proceedings are otherwise instituted by the corporation as provided in section 4042, a singleemployer plan may be terminated only in a standard termination under subsection (b) or a distress termination under subsection (c). "(2) 60-DAY NOTICE OF INTENT TO TERMINATE.—Not leSS than 60

days before the proposed termination date of a standard termination under subsection (b) or a distress termination under subsection (c), the plan administrator shall provide to each affected party (other than the corporation in the case of a standard termination) a written notice of intent to terminate stating that such termination is intended and the proposed termination date. The written notice shall include any related additional information required in regulations of the corporation. Corporations.

"(3) ADHERENCE TO COLLECTIVE BARGAINING AGREEMENTS.—

The corporation shall not proceed with a termination of a plan under this section if the termination would violate the terms and conditions of an existing collective bargaining agreement. Nothing in the preceding sentence shall be construed as limiting the authority of the corporation to institute proceedings to involuntarily terminate a plan under section 4042.". (b) DEFINITIONS RELATING TO SUFFICIENCY.—Section 4041(d) (29 U.S.C. 1341(d)) is amended to read as follows: "(d) SUFFICIENCY.—For purposes of this section— "(1) SUFFICIENCY FOR BENEFIT COMMITMENTS.—A single-employer plan is sufficient for benefit commitments if there is no amount of unfunded benefit commitments under the plan. "(2) SUFFICIENCY FOR GUARANTEED BENEFITS.—A single-employer plan is sufficient for guaranteed benefits if there is no amount of unfunded guaranteed benefits under the plan.". SEC. 11008. STANDARD TERMINATION OF SINGLE-EMPLOYER PLANS.

(a) IN GENERAL.—Section 4041 (as amended by section 11007 of this Act) is further amended by inserting after subsection (a) the following new subsection: "(b) STANDARD TERMINATION OF SINGLE-EMPLOYER PLANS.— "(1) GENERAL REQUIREMENTS.—A single-employer plan

may

terminate under a standard termination only if— "(A) the plan administrator provides the 60-day advance notice of intent to terminate to affected parties required under subsection (a)(2), "(B) the requirements of subparagraphs (A) and (B) of paragraph (2) are met.

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"(C) the corporation does not issue a notice of noncompliance under subparagraph (C) of paragraph (2), and "(D) when the final distribution of assets occurs, the plan is sufficient for benefit commitments (determined as of the termination date). '(2) TERMINATION PROCEDURE.— "(A) NOTICE TO THE CORPORATION.—As

soon as practicable after the date on which the notice of intent to terminate is provided pursuant to subsection (a)(2), the plan administrator shall send a notice to the corporation setting forth— "(i) certification by an enrolled actuary— "(I) of the projected amount of the assets of the plan (as of a proposed date of final distribution of assets), "(II) of the actuarial present value (as of such date) of the benefit commitments (determined as of the proposed termination date) under the plan, and "(III) that the plan is projected to be sufficient (as of such proposed date of final distribution) for such benefit commitments, "(ii) such information as the corporation may pre- Regulations, scribe in regulations as necessary to enable the corporation to make determinations under subparagraph (C), and "(iii) certification by the plan administrator that the information on which the enrolled actuary based the certification under clause (i) and the information provided to the corporation under clause (ii) are accurate and complete. "(B) NOTICE TO PARTICIPANTS AND BENEFICIARIES OF BENE-

FIT COMMITMENTS.—No later than the date on which a notice is sent by the plan administrator under subparagraph (A), the plan administrator shall send a notice to each person who is a participant or beneficiary under the plan— "(i) specifying the amount of such person's benefit commitments (if any) as of the proposed termination date and the benefit form on the basis of which such amount is determined, and "(ii) including the following information used in determining such benefit commitments: "(I) the length of service, "(II) the age of the participant or beneficiary, "(III) wages, "(IV) the assumptions, including the interest rate, and "(V) such other information as the corporation may require. Such notice shall be written in such manner as is likely to be understood by the participant or beneficiary and as may be prescribed in regulations of the corporation. "(C) NOTICE FROM THE CORPORATION OF NONCOMPLIANCE.—

"(i) IN GENERAL.—Within 60 days after receipt of the notice under subparagraph (A), the corporation shall issue a notice of noncompliance to the plan administrator if—

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PUBLIC LAW 99-272—APR. 7, 1986 "(I) it has reason to believe that any requirement of subsection (a)(2) or subparagraph (A) or (B) has not been met, or "(II) it otherwise determines, on the basis of information provided by affected parties or otherwise obtained by the corporation, that there is reason to beUeve that the plan is not sufficient for benefit commitments, "(ii) EXTENSION.—The corporation and the plan administrator may agree to extend the 60-day period referred to in clause (i) by a written agreement signed by the corporation and the plan administrator before the expiration of the 60-day period. The 60-day period shall be extended as provided in the agreement and may be further extended by subsequent written agreements signed by the corporation and the plan administrator made before the expiration of a previously agreed upon extension of the 60-day period. Any extension may be made upon such terms and conditions (including the payment of benefits) as are agreed upon by the corporation and the plan administrator. "(D) FINAL DISTRIBUTION OF ASSETS IN ABSENCE OF NOTICE

OF NONCOMPLIANCE.—The plan administrator shall commence the final distribution of assets pursuant to the standard termination of the plan as soon as practicable after the expiration of the 60-day (or extended) period referred to in subparagraph (C), but such final distribution may occur only if— "(i) the plan administrator has not received during such period a notice of noncompliance from the corporation under subparagraph (C), and "(ii) when such final distribution occurs, the plan is sufficient for benefit commitments (determined as of the termination date). "(3) METHODS OF FINAL DISTRIBUTION OF ASSETS.—

29 USC 1344.

"(A) IN GENERAL.—In connection with any final distribution of assets pursuant to the standard termination of the plan under this subsection, the plan administrator shall distribute the assets in accordance with section 4044. In distributing such assets, the plan administrator shall— "(i) purchase irrevocable commitments from an insurer to provide the benefit commitments under the plan and all other benefits (if any) under the plan to which assets are required to be allocated under section 4044, or "(ii) in accordance with the provisions of the plan and any applicable regulations of the corporation, otherwise fully provide the benefit commitments under the plan and all other benefits (if any) under the plan to which assets are required to be allocated under section 4044. "(B) CERTIFICATION TO THE CORPORATION OF FINAL DISTRIBUTION OF ASSETS.—Within 30 days after the final dis-

tribution of assets is completed pursuant to the standard termination of the plan under this subsection, the plan administrator shall send a notice to the corporation certifying that the assets of the plan have been distributed in

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accordance with the provisions of subparagraph (A) so as to pay the benefit commitments under the plan and all other benefits under the plan to which assets are required to be allocated under section 4044. 29 USC 1344. "(4) CONTINUING AUTHORITY.—Nothing in this section shall be construed to preclude the continued exercise by the corporation, after the termination date of a plan terminated in a standard termination under this subsection, of its authority under section 4003 with respect to matters relating to the termination. A 29 USC 1303. certification under paragraph (3)(B) shall not affect the corporation's obligations under section 4022.". 29 USC 1322. (b) CONFORMING AMENDMENT.—Section 4041(f) (29 U.S.C. 1341(f))

is amended to read as follows: "(f) LIMITATION ON THE CONVERSION OF A DEFINED BENEFIT PLAN TO A DEFINED CONTRIBUTION PLAN.—The adoption of an amendment

to a plan which causes the plan to become a plan described in section 4021(b)(l) constitutes a termination of the plan. Such an 29 USC 1821. amendment may take effect only after the plan satisfies the requirements for standard termination under subsection (b) or distress termination under subsection (c).". (c) AUTHORITY FOR 60-DAY EXTENSION.—In the case of a standard 29 USC 1341 termination of a plan under section 4041(b) of the Employee Retire- note. ment Income Security Act of 1974 (as amended by this section) with ^*^' P" ^'*' respect to which a notice of intent to terminate is filed before 120 days after the date of the enactment of this Act, the Pension Benefit Guaranty Corporation may, without the consent of the plan administrator, extend the 60-day period under section 4041(b)(2)(C)(i) of such Act (as so amended) for a period not to exceed 60 days. (d) SPECIAL TEMPORARY RULE.— 29 USC 1341 (1) REQUIREMENTS TO BE MET BEFORE FINAL DISTRIBUTION OF "O^.

ASSETS.—In the case of the termination of a single-employer plan described in paragraph (2) with respect to which the amount payable to the employer pursuant to section 4044(d) 29 USC 1344. exceeds $1,000,000 (determined as of the proposed date of final distribution of assets), the final distribution of assets pursuant to such termination may not occur unless the Pension Benefit Guaranty Corporation— (A) determines that the assets of the plan are sufficient for benefit commitments (within the meaning of section 4041(d)(1) of the Employee Retirement Income Security Act of 1974 (as amended by section 11007)) under the plan, and (B) issues to the plan administrator a written notice setting forth the determination described in subparagraph (A). (2) PLANS TO WHICH SUBSECTION APPLIES.—A single-employer

plan is described in this paragraph if— (A) the plan administrator has filed a notice of intent to terminate with the Pension Benefit Guaranty Corporation, and— (i) the filing was made before January 1, 1986, and the Corporation has not issued a notice of sufficiency for such plan before the date of the enactment of this Act, or (ii) the filing is made on or after January 1, 1986, and before 60 days after the date of the enactment of this Act and the Corporation has not issued a notice of

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 100 STAT. 248

5 USC 500 et seq-

PUBLIC LAW 99-272—APR. 7, 1986 sufficiency for such plan before the date of the enactment of this Act, and (B) of the persons who are (as of the termination date) participants in the plan, the lesser of 10 percent or 200 have filed complaints with the Corporation regarding such termination— (i) in the case of plans described in subparagraph (A)(i), before 15 days after the date of the enactment of this Act, or (ii) in any other case, before the later of 15 days after the date of the enactment of this Act or 45 days after the date of the filing of such notice. (3) CONSIDERATION OF COMPLAINTS.—The Corporation shall consider and respond to such complaints not later than 90 days after the date on which the Corporation makes the determination described in paragraph (1)(A). The Corporation may hold informal hearings to expedite consideration of such complaints. Any such hearing shall be exempt from the requirements of chapter 5 of title 5, United States Code. (4) DELAY ON ISSUANCE OF NOTICE.— (A) GENERAL RULE.—Except as provided in subparagraph

(B), the Corporation shall not issue any notice described in paragraph (1)(B) until 90 days after the date on which the Corporation makes the determination described in paragraph (1)(A). (B) EXCEPTION IN CASES OF SUBSTANTIAL BUSINESS HARD-

SHIP.—Except in the case of an acquisition, takeover, or leveraged buyout, the preceding provisions of this subsection shall not apply if the contributing sponsor demonstrates to the satisfaction of the Corporation that the contributing sponsor is experiencing substantial business hardship. For purposes of this subparagraph, a contributing sponsor shall be considered as experiencing substantial business hardship if the contributing sponsor has been operating, and can demonstrate that the contributing sponsor will continue to operate, at an economic loss. SEC. 11009. DISTRESS TERMINATION OF SINGLE-EMPLOYER PLANS.

29 USC 1341.

(a) IN GENERAL.—Section 4041 (as amended by sections 11007 and 11008 of this Act) is further amended by inserting after subsection (b) the following new subsection: "(c) DISTRESS TERMINATION OF SINGLE-EMPLOYER PLANS.—

"(1) IN GENERAL.—A single-employer plan may terminate under a distress termination only if— "(A) the plan administrator provides the 60-day advance notice of intent to terminate to affected parties required under subsection (a)(2), "(B) the requirements of subparagraph (A) of paragraph (2) are met, and "(C) the corporation determines that the requirements of subparagraph (B) of paragraph (2) are met. Regulations.

"(2) TERMINATION REQUIREMENTS.— "(A) INFORMATION SUBMITTED TO THE CORPORATION.—As

soon as practicable after the date on which the notice of intent to terminate is provided pursuant to subsection (a)(2), the plan administrator shall provide the corporation, in

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such form as may be prescribed by the corporation in regulations, the following information: "(i) such information as the corporation may prescribe by regulation as necessary to make determinations under subparagraph (B) and paragraph (3); "(ii) certification by an enrolled actuary of— "(I) the amount (as of the proposed termination date) of the current value of the assets of the plan, "(II) the actuarial present value (as of such date) of the benefit commitments under the plan, "(III) whether the plan is sufficient for benefit commitments as of such date, "(IV) the actuarial present value (as of such date) of benefits under the plan guaranteed under section 4022, and 29 USC 1322. "(V) whether the plan is sufficient for guaranteed benefits as of such date; "(iii) in any case in which the plan is not sufficient for benefit commitments as of such date— "(I) the name and address of each participant and beneficiary under the plan as of such date, and "(II) such other information as shall be prescribed by the corporation by regulation as necessary to enable the corporation (or its designee under section 4049(b)) to be able to make payments Post, p. 258. to participants and beneficiaries as required under section 4049; and "(iv) certification by the plan administrator that the information on which the enrolled actuary based the certifications under clause (ii) and the information provided to the corporation under clauses (i) and (iii) are accurate and complete. "(B) DETERMINATION BY THE CORPORATION OF NECESSARY

DISTRESS CRITERIA.—Upon receipt of the notice of intent to terminate required under subsection (a)(2) and the information required under subparagraph (A), the corporation shall determine whether the requirements of this subparagraph are met as provided in clause (i), (ii), or (iii). The requirements of this subparagraph are met if each person who is (as of the termination date) a contributing sponsor of such plan or a substantial member of such sponsor's controlled group meets the requirements of any of the following clauses: "(i)

LIQUIDATION

IN

BANKRUPTCY

OR

INSOLVENCY

PROCEEDINGS.—The requirements of this clause are met by a. person if— "(I) such person has filed or has had filed against such person, as of the termination date, a petition seeking liquidation in a case under title 11, United States Code, or under any similar law of a State or political subdivision of a State, and "(II) such case has not, as of the termination date, been dismissed, "(ii) REORGANIZATION IN BANKRUPTCY OR INSOLVENCY

PROCEEDINGS.—The requirements of this clause are met by a person if—

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 100 STAT. 250

PUBLIC LAW 99-272—APR. 7, 1986 "(I) such person has filed, or has had filed against such person, as of the termination date, a petition seeking reorganization in a case under title 11, United States Code, or under any similar law of a State or political subdivision of a State (or a case described in clause (i) filed by or against such person has been converted, as of such date, to such a case in which reorganization is sought), "(II) such case has not, as of the termination date, been dismissed, and "(III) the bankruptcy court (or other appropriate court in a case under such similar law of a State or political subdivision) approves the termination, "(iii) TERMINATION REQUIRED TO ENABLE PAYMENT OF DEBTS WHILE STAYING IN BUSINESS OR TO AVOID UNREASONABLY BURDENSOME PENSION COSTS CAUSED BY DECLINING WORKFORCE.—The requirements of this clause are met by a person if such person demonstrates to the satisfaction of the corporation that— "(I) unless a distress termination occurs, such person will be unable to pay such person's debts when due and will be unable to continue in business, or "(II) the costs of providing pension coverage have become unreasonably burdensome to such person, solely as a result of a decline of such person's workforce covered as participants under all singleemployer plans of which such person is a contributing sponsor. "(C) SUBSTANTIAL MEMBER.—For purposes of subpara-

graph (B), the term 'substantial member' of a controlled group means a person whose assets comprise 5 percent or more of the total assets of the controlled group as a whole. "(D) NOTIFICATION OF DETERMINATIONS BY THE CORPORA-

TION.—The corporation shall notify the plan administrator as soon as practicable of its determinations made pursuant to subparagraph (B). ^ "(3) TERMINATION PROCEDURE.— "(A) DETERMINATIONS BY THE CORPORATION RELATING TO PLAN SUFFICIENCY FOR GUARANTEED BENEFITS AND FOR BENE-

FIT COMMITMENTS.—If the Corporation determines that the requirements for a distress termination set forth in paragraphs (1) and (2) are met, the corporation shall— "(i) determine that the plan is sufficient for guaranteed benefits (as of the termination date) or that the corporation is unable to make such determination on the basis of information made available to the corporation, "(ii) determine that the plan is sufficient for benefit commitments (as of the termination date) or that the corporation is unable to make such determination on the basis of information made available to the corporation, and "(iii) notify the plan administrator of the determinations made pursuant to this subparagraph as soon as practicable.

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"(B) IMPLEMENTATION OF TERMINATION.—After the corporation notifies the plan administrator of its determinations under subparagraph (A), the termination of the plan shall be carried out as soon as practicable, as provided in clause (i), (ii), or (iii). "(i) CASES OF SUFFICIENCY FOR BENEFIT COMMIT-

MENTS.—In any case in which the corporation determines that the plan is sufficient for benefit commitments, the plan administrator shall proceed to distribute the plan s assets, and make certification to the corporation with respect to such distribution, in the manner described in subsection (b)(3), and shall take such other actions as may be appropriate to carry out the termination of the plan, "(ii) CASES OF SUFFICIENCY FOR GUARANTEED BENEFITS WITHOUT A FINDING OF SUFFICIENCY FOR BENEFIT

COMMITMENTS.—In any case in which the corporation determines that the plan is sufficient for guaranteed benefits, but further determines that it is unable to determine that the plan is sufficient for benefit commitments on the basis of the information made available to it— "(I) the plan administrator shall proceed to distribute the plan's assets in the manner described in subsection (b)(3), make certification to the corporation that the distribution has occurred, and take such actions as may be appropriate to carry out the termination of the plan, and "(II) the corporation shall establish a separate trust in connection with the plan for purposes of section 4049. Post, p. 258. "(iii) CASES WITHOUT ANY FINDING OF SUFFICIENCY.— In any case in which the corporation determines that it is unable to determine that the plan is sufficient for guaranteed benefits on the basis of the information made available to it— "(I) the corporation shall commence proceedings Post, p. 253. in accordance with section 4042, and "(II) the corporation shall establish a separate trust in connection with the plan for purposes of section 4049 unless the corporation determines that all benefit commitments under the plan are benefits guaranteed by the corporation under section 4022. 29 USC 1322. "(C) FINDING AFTER AUTHORIZED COMMENCEMENT OF TERMINATION THAT PLAN IS UNABLE TO PAY BENEFITS.— "(i) FINDING WITH RESPECT TO BENEFIT COMMITMENTS WHICH ARE NOT GUARANTEED BENEFITS.—If, after the

plan administrator has begun to terminate the plan as authorized under subparagraph (B)(i), the plan administrator finds that the plan is unable, or will be unable, to pay benefit commitments which are not benefits guaranteed by the corporation under section 4022, the plan administrator shall notify the corporation of such finding as soon as practicable thereafter. If the corporation concurs in the finding of the plan administrator (or the corporation itself makes such a

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PUBLIC LAW 99-272—APR. 7, 1986

Post, p. 258.

finding) the corporation shall take the actions set forth in subparagraph (B)(ii)(II) relating to the trust established for purposes of section 4049. "(ii) FINDING WITH RESPECT TO GUARANTEED BENE-

29 USC 1322.

29 USC 1342.

FITS.—If, after the plan administrator has begun to terminate the plan as authorized by subparagraph (B)(i) or (ii), the plan administrator finds that the plan is unable, or will be unable, to pay all benefits under the plan which are guaranteed by the corporation under section 4022, the plan administrator shall notify the corporation of such finding as soon as practicable thereafter. If the corporation concurs in the finding of the plan administrator (or the corporation itself makes such a finding), the corporation shall institute appropriate proceedings under section 4042. "(D) ADMINISTRATION OF THE PLAN DURING INTERIM PERIOD.—

"(i) IN GENERAL.—The plan administrator shall— "(I) meet the requirements of clause (ii) for the period commencing on the date on which the plan administrator provides a notice of distress termination to the corporation under subsection (a)(2) and ending on the date on which the plan administrator receives notification from the corporation of its determinations under subparagraph (A), and "(II) meet the requirements of clause (ii) commencing on the date on which the plan administrator or the corporation makes a finding under subparagraph (C)(ii). "(ii) REQUIREMENTS.—The requirements of this clause are met by the plan administrator if the plan administrator— "(I) refrains from distributing assets or taking any other actions to carry out the proposed termination of this subsection, "(II) pays benefits attributable to employer contributions, other than death benefits, only in the form of an annuity, "(III) does not use plan assets to purchase irrevocable commitments to provide benefits from an insurer, and "(IV) continues to pay all benefit commitments under the plan, but, commencing on the proposed termination date, limits the payment of benefits under the plan to those benefits which are guaranteed by the corporation under section 4022 or to which assets are required to be allocated under section 4044. In the event the plan administrator is later determined not to have met the requirements for distress termination, any benefits which are not paid solely by reason of compliance with subclause (IV) shall be due and payable immediately (together with interest, at a reasonable rate, in accordance with regulations of the corporation).". 29 USC 1341.

(b) CONFORMING AMENDMENTS.—Section 4041 (as amended by the

preceding provisions of this title) is further amended— (1) by striking out subsection (e); and (2) by redesignating subsection (f) as subsection (e).

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SEC. 11010. TERMINATION PROCEEDINGS; DUTIES OF THE CORPORATION. (a) MANDATORY COMMENCEMENT OF PROCEEDINGS UPON INABILITY OF SINGLE-EMPLOYER PLAN TO PAY BENEFITS THAT ARE CURRENTLY DUE.—

(1) IN GENERAL.—Section 4042(a) (29 U.S.C. 1342(a)) is amended— (A) in paragraph (2), by striking out "is" and inserting in lieu thereof "will be"; and (B) by inserting at the beginning of the matter following paragraph (4) the following new sentence: "The corporation shall as soon as practicable institute proceedings under this section to terminate a single-employer plan whenever the corporation determines that the plan does not have assets available to pay benefits which are currently due under the terms of the plan". (2) CONFORMING AMENDMENTS.—

(A) Section 4042(b)(1) (29 U.S.C. 1342(b)(1)) is amended, in the first sentence, by inserting "or is required under subsection (a) to institute proceedings under this section," after "to a plan". (B) Section 4042(c) (29 U.S.C. 1342(c)) is amended in the first sentence by striking out "If the corporation" and all that follows down through "has determined" and inserting in lieu thereof the following: "If the corporation is required under subsection (a) of this section to commence proceedings under this section with respect to a plan or, after issuing a notice under this section to a plan administrator, has determined". (b) ESTABLISHMENT OF SECTION 4049 TRUST.—Section 4042 is further amended by adding at the end thereof the following new subsection: "(i) In any case in which a plan is terminated under this section in a termination proceeding initiated by the corporation pursuant to subsection (a), the corporation shall establish a separate trust in connection with the plan for purposes of section 4049, unless the Post, p. 258. corporation determines that all benefit commitments under the plan are benefits guaranteed by the corporation under section 4022 or 29 USC 1322. that there is no amount of unfunded benefit commitments under the plan.". (c) CONFORMING AMENDMENT.—The heading for section 4042 is amended to read as follows: "INSTITUTION OF TERMINATION PROCEEDINGS BY THE CORPORATION", SEC. 11011. AMENDMENTS TO LIABILITY PROVISIONS; LIABILITIES RELATING TO BENEFIT COMMITMENTS IN EXCESS OF BENEFITS GUARANTEED BY THE CORPORATION. (a) LIABILITY FOR DISTRESS TERMINATIONS AND TERMINATIONS BY

THE CORPORATION.—Section 4062 (29 U.S.C. 1362) is amended— (1) by redesignating subsection (e) as subsection (f); and (2) by striking out so much as precedes subsection (f) (as redesignated) and inserting in lieu thereof the following:

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 100 STAT. 254

PUBLIC LAW 99-272—APR. 7, 1986 "LIABILITY FOR TERMINATION OF SINGLE-EMPLOYER PLANS UNDER A DISTRESS TERMINATION OR A TERMINATION BY THE CORPORATION

Ante, p. 248. Ante, p. 253.

Ante, pp. 248, 253.

"SEC. 4062. (a) IN GENERAL.—In any case in which a singleemployer plan is terminated in a distress termination under section 4041(c) or a termination otherwise instituted by the corporation under section 4042, any person who is, on the termination date, a contributing sponsor of the plan or a member of such a contributing sponsor's controlled group shall incur liability under this section. The liability under this section of all such persons shall be joint and several. The liability under this section consists of— "(1) liability to the corporation, to the extent provided in subsection (b), "(2) liability to the trust established pursuant to section 4041(c)(3)(B) (ii) or (iii) or section 4042(i), to the extent provided in subsection (c), and "(3) liability to the trustee appointed under subsection (b) or (c) of section 4042, to the extent provided in subsection (d). "(b) LlABILITY TO THE CORPORATION.— "(1) AMOUNT OF LIABILITY.—

"(A) IN GENERAL.—Except as provided in subparagraph (B), the liability to the corporation of a person described in subsection (a) shall consist of the sum of— "(i) the lesser of— "(I) the total amount of unfunded guaranteed benefits (as of the termination date) of all participants and beneficiaries under the plan, or "(II) 30 percent of the collective net worth of all persons described in subsection (a), and "(ii) the excess (if any) of— "(I) 75 percent of the amount described in clause (i)(I), over "(II) the amount described in clause (i)(II), together with interest (at a reasonable rate) calculated from the termination date in accordance with regulations prescribed by the corporation. "(B)

SPECIAL RULE IN CASE OF SUBSEQUENT INSUFFI-

CIENCY.—For purposes of subparagraph (A), in any case described in section 4041(c)(3)(C)(ii), actuarial present values shall be determined as of the date of the notice to the corporation (or the finding by the corporation) described in such section. "(2) PAYMENT OF LIABILITY.—

"(A) IN GENERAL.—Except as provided in subparagraph (B), the liability to the corporation under this subsection shall be due and payable to the corporation as of the termination date, in cash or securities acceptable to the corporation. "(B) SPECIAL RULE.—Payment of the liability under paragraph (l)(A)(ii) shall be made under commercially reasonable terms prescribed by the corporation. The parties involved shall make a reasonable effort to reach agreement on such commercially reasonable terms. Any such terms prescribed by the corporation shall provide for deferral of 50 percent of any amount of liability otherwise payable for any year under this subparagraph if a person subject to

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Rh and possibly the Pawnees. I could, therefore, not have recommended the return of the Poncas to Dakota without at the same time keeping in view the probable necessity of returning other Indian tribes from the Indian Territory to the region originally inhabited by them. This would, in all probability, result in an extensive evacuation of the Indian Territory, and just of that part of it which contains the lands coveted by the intruders, and which lands are held against them on the ground that they are reserved for Indian settlement. It is obvious that the evacuation by the Indians of the region held for Indian settlement, and defended on that very ground against intruders, would be apt greatly to encourage and stimulate the projects of invasion which, although repeatedly repelled, are pursued by evil-disposed persons with persistent activity. The defense of the Indian Territory against that invasion would inevitably become much more precarious, and the breaking down of all barriers before the Indian tribes inhabiting the Territory are prepared for such an event, would, in all probability, be most disastrous to them. While the original removal of the Poncas from the North to the Indian Territory was an injustice to them, yet, that removal and their settlement in the Indian Territory accomplished, the aspect of the question changed very materially, inasmuch as the measure intended to right their wrongs by their return, would be apt to bring a new wrong upon Indian tribes far more numerous, a wrong greater than the injury originally suffered by the Poncas themselves. These are the reasons why, although recognizing the hardships endured by the Poncas, I could not conscientiously recommend their return to Dakota. There is a bill now before Congress providing for that return. If it is to become a law, it should not be without a clear view of the probable consequences. Recommendation has repeatedly been made by this department that Congress provide an appropriation for the purpose of amply indemnifying the Poncas, and that recommendation is now urgently repeated.

The long guerrilla warfare carried on by Victoria's band of hostile Indians in New Mexico has at last come to a close by the death of Victoria, and the destruction of the larger part of his followers on Mexican soil. In my last annual report, and that of the Commissioner of Indian Affairs, the circumstances which led to the outbreak of hostilities between Victoria's band and the forces of the United States were elaborately set forth. As appears therefrom those circumstances did not consist, as alleged in the report of a military officer, in the persistent efforts to remove Victoria and his followers to the San Carlos Agency, for while such a project was formerly entertained, it had been given up at the time when the outbreak occurred. Victoria had come on the 13th of June, 1879, with a small number of followers to the Mescalero Agency in New Mexico, and upon a conference with the Indian Agent, given his promise to stay there quietly. That promise had been accepted and


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such liability demonstrates to the satisfaction of the corporation that no person subject to such liability has any individual pre-tax profits for such person's fiscal year ending during such year. "(3) ALTERNATIVE ARRANGEMENTS.—The corporation and any

person liable under this section may agree to alternative arrangements for the satisfaction of liability to the corporation under this subsection. "(c) LIABILITY TO SECTION 4049 TRUST.— "(1) AMOUNT OF LIABILITY.—

"(A) IN GENERAL.—In any case in which there is an outstanding amount of benefit commitments under a plan terminated under section 4041(c) or 4042, a person described Ante, pp. 248, in subsection (a) shall be subject to liability under this ^53. subsection to the trust established under section 4041(c)(3)(B) (ii) or (iii) or section 4042(i) in connection with the terminated plan. Except as provided in subparagraph (B), the liability of such person under this subsection shall consist of the lesser of— "(i) 75 percent of the total outstanding amount of benefit commitments under the plan, or "(ii) 15 percent of the actuarial present value (determined as of the termination date on the basis of assumptions prescribed by the corporation for purposes of section 4044) of all benefit commitments under the 29 USC 1344. plan. "(B) SPECIAL RULE IN CASE OF SUBSEQUENT INSUFFI-

CIENCY.—For purposes of subparagraph (A)— "(i) PLANS INSUFFICIENT FOR GUARANTEED BENEFITS.—

In any case described in section 4041(c)(3)(C)(ii), actuarial present values shall be determined as of the date of the notice to the corporation (or the finding by the corporation) described in such section. "(ii) PLANS SUFFICIENT FOR GUARANTEED BENEFITS BUT INSUFFICIENT FOR BENEFIT ENTITLEMENTS.—In any C a s e

described in section 4041(c)(3)(C)(i) but not described in section 4041(c)(3)(C)(ii), actuarial present values shall be determined as of the date on which the final distribution of assets is completed. "(2) PAYMENT OF LIABILITY.—

"(A) GENERAL RULE.—Except as otherwise provided in this paragraph, payment of a person's liability under this subsection shall be made for liability payment years under commercially reasonable terms prescribed by the fiduciary designated by the corporation pursuant to section 4049(b)(1)(A). Such fiduciary and the liable persons assessed Post, p. 258. liability under this subsection shall make a reasonable effort to reach agreement on such commercially reasonable terms. "(B) SPECIAL RULE FOR PLANS WITH LOW AMOUNTS OF

LIABILITY.—In any case in which the amount described in paragraph (1)(A) is less than $100,000, the requirements of subparagraph (A) may be satisfied by payment of such liability over 10 liability payment years in equal annual installments (with interest at the rate determined under section 66210t)) of the Internal Revenue Code of 1954). The 26 USC 6621. corporation may, by regulation, increase the dollar amount

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