TABLE OF CONTENTS:
Title I: Contributions to Personal Retirement Accounts
Title II: Personal Retirement Accounts
Title III: Certification of Financial Institutions Other
Than Insured Depository Institutions
Title IV: Personal Retirement Account Insurance
Title V: Enforcement Authority
Title VI: Transition from Coverage for Old-Age and Survivors
Insurance Benefits Under Title II of the Social Security
Act
Title VII: Provisions Relating to Federal Civilian and
Military Personnel
Title VIII: Social Security Transition Commission
Personal Retirement Accounts Act of 1997 - Title I: Contributions to Personal Retirement Accounts - Requires employers to: (1) have personal retirement account payroll deduction programs in effect for their eligible employees; and (2) deduct and pay into such accounts the prescribed employee contribution, together with a prescribed employer contribution. Authorizes eligible individuals to elect to establish a personal retirement account. Requires self-employed individuals to establish and pay into such accounts. Establishes penalties for employers and self-employed individuals who fail to establish and make required deductions and contributions to such accounts. Requires the Securities and Exchange Commission (SEC) to impose such penalties in a civil action.
Title II: Personal Retirement Accounts - Prescribes general requirements for personal retirement accounts, as well as investment, distribution, and insurance requirements. Provides for tax deductible contributions by an eligible individual to a nonworking spousal retirement account.
(Sec. 205) Exempts personal retirement accounts from income tax, except the tax on unrelated business income of charitable, etc. organizations. Requires inclusion in the gross income of the account holder for the taxable year of any amount paid or distributed out of such an account, except: (1) amounts used to acquire minimum or more generous immediate annuities; and (2) transfers incident to a divorce.
(Sec. 207) Subjects trustees of personal retirement accounts to penalties (for prohibited transactions) for failure to meet investment or distribution requirements.
(Sec. 208) Requires the relevant Federal agency to notify the SEC of: (1) the identity of each insured depository institution or credit union; and (2) any termination of such status.
Directs the trustee of a personal retirement account to make certain reports regarding such account to the SEC and to the account holder with respect to contributions (and the years to which they relate), distributions, and other matters the SEC may require.
(Sec. 210) Directs the SEC to study and report to the President and the Congress on the best means of providing for options under which distributions from a personal retirement account established under this Act may commence in advance of the date on which the account holder attains retirement age.
Title III: Certification of Financial Institutions Other Than Insured Depository Institutions - Allows any financial institution to apply to the SEC for certification.
(Sec. 302) Authorizes the SEC to require any certified financial institution to file certain reports, including information on the total amount of all liability of the institution for balances maintained in personal retirement accounts for which such institution serves as trustee.
(Sec. 303) Provides for voluntary and involuntary revocation of certification status, including judicial review of involuntary revocations.
Title IV: Personal Retirement Account Insurance - Requires the SEC, in any case in which it declares an insurable event with respect to a qualified financial institution serving as trustee of a personal retirement account, to guarantee the timely distribution of the balance in such account (but not in excess of the minimum annuity amount) to the account holder in accordance with the terms governing such account and the provisions of this Act.
(Sec. 401) Defines as an insurable event with respect to a qualified financial institution serving as trustee of a personal retirement account: (1) termination of the institution's qualified status; (2) the inability of the institution to make full distributions of the balance in the account when due; and (3) termination of the account.
Requires the SEC to guarantee a minimum distribution from the account as of the normal retirement date in the amount of the minimum annuity amount, notwithstanding that the balance in the account as of such date is less than the minimum annuity amount, if certain conditions apply. Requires the SEC also to provide for a range of alternative guarantee arrangements providing for timely distribution of all, or a larger portion, of the balance in the personal retirement account to the account holder, which may be elected by the account holder upon payment to the SEC of supplemental premiums. Allows for the substitution of private insurance providing for a guarantee of timely distributions at the election of the account holder which is at least equivalent to the guarantee provided for by this title.
Entitles an account holder, in certain cases, to a supplemental minimum benefit payment to their account upon application to the SEC on or after the normal retirement date.
(Sec. 402) Directs the SEC to: (1) establish a risk-based assessment system for any qualified financial institution serving as trustee of a personal retirement account; (2) set semiannual assessments for such institutions to achieve and maintain the designated reserve ratio; and (3) notify each qualified financial institution of that institution's semiannual assessment.
Sets forth a special rule until the Social Security Savings Insurance Trust Fund established by this title achieves the designated reserve ratio, as well as a special rule for recapitalizing the Trust Fund if it becomes undercapitalized.
Provides that, in addition to the other assessments on qualified financial institutions, the SEC may impose one or more special assessments on qualified financial institutions if the amount of any such assessment is necessary: (1) to provide sufficient assessment income to repay amounts borrowed from the Secretary of the Treasury which become due; or (2) for any other purpose the Commission may deem necessary.
Requires each qualified financial institution to: (1) file with the SEC a certified statement containing such information as the Commission may require for determining the institution's semiannual assessment; and (2) pay to the Commission the semiannual assessment imposed.
Establishes penalties for inaccurate certified statements and for late payments.
(Sec. 403) Establishes in the Treasury the Social Security Savings Insurance Trust Fund, made up of various specified funds, assessments, penalties, earnings, attorney's fees, and receipts. Makes the Trust Fund available for: (1) making guaranteed payments; (2) purchasing the assets of a financial institution which ceases to be qualified; (3) repaying borrowed sums to the Secretary of the Treasury; (4) paying the SEC's operational and administrative expenses; and (5) paying account holders the amounts guaranteed with respect to any personal retirement account. Provides for the investment of trust fund assets.
Authorizes the SEC to borrow from the Secretary of the Treasury.
(Sec. 404) Authorizes the SEC to institute proceedings to terminate a personal retirement account whenever it determines that: (1) the SEC's possible long-run loss with respect to the account may reasonably be expected to increase unreasonably if the account is not terminated; or (2) an insurable event has occurred. Provides for appointment of an alternative trustee pending issuance of a termination decree.
(Sec. 405) Makes each person who is the financial institution serving as trustee of the account on the termination date or a member of the financial institution's controlled group jointly and severally liable to the SEC in any case in which a personal retirement account is terminated in a SEC-instituted proceeding. Sets such liability as the total amount of account assets guaranteed by the SEC which are not available for payment. Provides for payment of the liability.
(Sec. 406) Requires each qualified financial institution, while serving as trustee for a personal retirement account subject to SEC guarantee, to display at each place of business maintained by such institution a sign with specified declarations relating to such accounts.
Title V: Enforcement Authority - Provides for a personal retirement account holder adversely affected by an act or practice of any party other than the SEC in violation of this Act to bring an action in U.S. district court to enjoin such act or practice, or obtain other appropriate equitable relief. Grants the relevant Federal agency, the SEC, and the Social Security Commission the right to intervene in any such action.
Title VI: Transition from Coverage for Old-Age and Survivors Insurance Benefits Under Title II of the Social Security Act - Amends title II (Old Age, Survivors and Disability Insurance) (OASDI) of the Social Security Act (SSA) to provide for primary insurance amounts for transitional eligible individuals under this Act who elect to participate in the personal retirement account payroll deduction programs of their employer.
(Sec. 602) Requires the Commissioner of Social Security to provide a written certification to each individual with a social security account number who has been credited with wages or net earnings from self-employment indicating whether such recipient is or is not an eligible individual, together with a description of OASDI benefits available.
(Sec. 603) Amends the Internal Revenue Code to provide for a reduction in Federal Insurance Contributions Act and Self-Employment Contributions Act of 1954 taxes for wages and self-employment income imposed on an individual who has elected to forego OASDI benefits in favor of a personal retirement account.
(Sec. 604) Amends SSA title II to: (1) add a supplemental retirement benefit program for certain individuals with personal retirement accounts; (2) provide for a phased-in increase in the social security retirement age; and (3) place a limitation on cost-of-living adjustments (COLAs), with a reduction in COLA increases applied to higher primary insurance amounts.
(Sec. 607) Provides for modification of the Consumer Price Index calculation of such COLAs.
(Sec. 608) Amends SSA title II to provide for: (1) a phased-in reduction in spousal benefits other than survivors' benefits to 33 percent of the primary insurance amount; (2) coverage of newly hired State and local employees; and (3) adjustments in the formula for determining primary insurance amounts.
(Sec. 611) Amends Federal law to require submission to the Congress along with the Federal budget of a statement of the current accrued liability of the Federal Government for future benefit payments under the OASDI program.
Title VII: Provisions Relating to Federal Civilian and Military Personnel - Directs the Office of Personnel Management to study and report to the President and the Congress: (1) on how to provide for the application of this Act with respect to Federal civilian and military personnel; and (2) draft legislation which, if enacted, would carry out any recommendations in the report.
(Sec. 702) Requires such report and draft legislation to address specified aspects of the existing Civil Service and Federal Employees' Retirement Systems for such Federal personnel.
(Sec. 703) Specifies matters in the new system for the report and draft legislation to address with respect to the implementation of any other title of this Act.
Title VIII: Social Security Transition Commission - Establishes the Social Security Transition Commission to make findings and recommendations about the most appropriate actions which should be taken to minimize, and adequately fund, any increases in budget outlays resulting from implementation of this Act. Requires all recommended reductions in obligational authority to be done in a manner that makes them permanent.
(Sec. 805) Sets forth procedures (including expedited procedures) for congressional consideration of such recommendations.
(Sec. 807) Authorizes appropriations.
[Congressional Bills 105th Congress]
[From the U.S. Government Printing Office]
[H.R. 2768 Introduced in House (IH)]
105th CONGRESS
1st Session
H. R. 2768
To provide for the retirement of all Americans.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
October 29, 1997
Mr. Sanford introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committees on
Education and the Workforce, Rules, and Banking and Financial Services,
for a period to be subsequently determined by the Speaker, in each case
for consideration of such provisions as fall within the jurisdiction of
the committee concerned
_______________________________________________________________________
A BILL
To provide for the retirement of all Americans.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Personal
Retirement Accounts Act of 1997''.
(b) Table of Contents.--
Sec. 1. Short title and table of contents.
Sec. 2. Definitions.
TITLE I--CONTRIBUTIONS TO PERSONAL RETIREMENT ACCOUNTS
Sec. 101. Personal retirement account payroll deduction programs.
Sec. 102. Designation of personal retirement accounts.
Sec. 103. Self-employed individuals.
Sec. 104. Elective participation.
Sec. 105. Penalties.
TITLE II--PERSONAL RETIREMENT ACCOUNTS
Sec. 201. General requirements for personal retirement accounts.
Sec. 202. Investment requirements.
Sec. 203. Distribution requirements.
Sec. 204. Insurance requirements.
Sec. 205. Personal retirement account exempt from income tax.
Sec. 206. Tax treatment of distributions.
Sec. 207. Penalty on trustee for failure of personal retirement account
to meet requirement.
Sec. 208. Notification regarding insured depository institutions.
Sec. 209. Reports.
Sec. 210. Study on implementation of early retirement options.
TITLE III--CERTIFICATION OF FINANCIAL INSTITUTIONS OTHER THAN INSURED
DEPOSITORY INSTITUTIONS
Sec. 301. Certification of financial institutions by the Securities and
Exchange Commission.
Sec. 302. Access to records.
Sec. 303. Revocation of certification.
TITLE IV--PERSONAL RETIREMENT ACCOUNT INSURANCE
Sec. 401. Guarantees and supplemental minimum benefit payments.
Sec. 402. Assessments of qualified financial institutions by the
Commission.
Sec. 403. Establishment of Social Security Savings Insurance Trust
Fund.
Sec. 404. Institution of termination proceedings by the Commission.
Sec. 405. Liability upon termination of accounts.
Sec. 406. Insurance logo.
Sec. 407. Report by the Commission.
TITLE V--ENFORCEMENT AUTHORITY
Sec. 501. Cause of action.
Sec. 502. Jurisdiction and venue.
Sec. 503. Right of Securities and Exchange Commission to intervene.
Sec. 504. Awards of costs and expenses.
Sec. 505. Limitation on actions.
Sec. 506. Penalty for failure to timely provide required information.
Sec. 507. Actions by Securities and Exchange Commission.
TITLE VI--TRANSITION FROM COVERAGE FOR OLD-AGE AND SURVIVORS INSURANCE
BENEFITS UNDER TITLE II OF THE SOCIAL SECURITY ACT
Sec. 601. Primary insurance amounts for transitional eligible
individuals.
Sec. 602. Certification of covered status under the old-age, survivors,
and disability insurance program.
Sec. 603. Reduction in FICA and SECA taxes with respect to eligible
individuals.
Sec. 604. Supplemental retirement benefits.
Sec. 605. Phased in increase in social security retirement age.
Sec. 606. Limitation in cost-of-living adjustments.
Sec. 607. Modification of CPI calculation for social security COLAs.
Sec. 608. Phased reduction in spousal benefits other than survivor's
benefits to 33 percent of primary insurance
amount.
Sec. 609. Coverage of newly hired State and local employees.
Sec. 610. Adjustments in formula for determining primary insurance
amount.
Sec. 611. Annual statement of accrued liability of the old-age and
survivors insurance program.
TITLE VII--PROVISIONS RELATING TO FEDERAL CIVILIAN AND MILITARY
PERSONNEL
Sec. 701. Federal civilian and military personnel.
Sec. 702. Provisions relating to the continued operation of existing
retirement systems.
Sec. 703. Provisions relating to the new system.
TITLE VIII--SOCIAL SECURITY TRANSITION COMMISSION
Sec. 801. Establishment of Commission.
Sec. 802. Duties.
Sec. 803. Membership.
Sec. 804. Powers.
Sec. 805. Congressional consideration of recommendations.
Sec. 806. Definitions.
Sec. 807. Authorization of appropriations.
SEC. 2. DEFINITIONS.
For purposes of this Act--
(1) Account holder.--The term ``account holder'' means,
with respect to any personal retirement account, the individual
for whose benefit such account is maintained.
(2) Business day.--The term ``business day'' means any day
other than a Saturday, Sunday, or legal holiday in the area
involved.
(3) Covered employer.--The term ``covered employer'' means,
for any calendar year, a person for whom an eligible individual
is engaged in employment during the year.
(4) Eligible individual.--The term ``eligible individual''
means any individual who, as of January 1, 2000--
(A) is not entitled to an old-age insurance benefit
under section 202(a) of the Social Security Act or to a
disability insurance benefit under section 223 of such
Act, and
(B) has made the election under section 104(a).
(5) Employment.--The term ``employment'' has the meaning
provided in section 210 of the Social Security Act.
(6) Minimum annuity amount; minimum annuity.--
(A) Minimum annuity amount.--
(i) In general.--The term ``minimum annuity
amount'' means, as of any date, the amount
determined by the trustee (under regulations
issued by appropriate regulatory agency) to be
necessary to purchase on such date an immediate
annuity which is a minimum annuity.
(ii) Reduction to account for old-age
insurance benefits.--In the case of an eligible
individual who is entitled to old-age insurance
benefits under section 202 of the Social
Security Act, the minimum annuity amount
determined under clause (i) shall be reduced by
the actuarial present value, as of the date
referred to in clause (ii), of future old-age
insurance benefits payable to such individual
under such section (determined by using
reasonable assumptions which shall be
prescribed by the Commission).
(iii) Immediate annuity.--For purposes of
clause (i), the term ``immediate annuity''
means an annuity--
(I) which is purchased with a
single premium or annuity
consideration,
(II) the annuity starting date (as
defined in section 72(c)(4) of the
Internal Revenue Code of 1986) of which
commences no later than 1 year from the
date of the purchase of the annuity,
and
(III) which provides for a series
of substantially equal periodic
payments (to be made not less
frequently than annually) during the
annuity period, subject to adjustment
under subparagraph (C).
(B) Minimum annuity.--
(i) In general.--The term ``minimum
annuity'' means an annuity making payments over
the life (or life expectancy) of the account
holder which (on an annual basis) equals
$9,150.
(ii) Joint and survivor annuity and
preretirement survivor annuity requirements.--
An annuity shall not be treated as a minimum
annuity within the meaning of clause (i) unless
the requirements of section 401(a)(11) of the
Internal Revenue Code of 1986 applicable to
plans are met with respect to such annuity.
(C) Cost-of-living adjustment.--
(i) In general.--The Securities and
Exchange Commission shall--
(I) assume, in determining any
minimum annuity amount under
subparagraph (A), an annual adjustment
in the equal periodic payments referred
to in subparagraph (A)(iii)(III), and
(II) adjust annually after calendar
year 2000 the dollar amount set forth
in subparagraph (B)(i),
for increases in the cost of living in
accordance with regulations prescribed by the
Commission.
(ii) Adjustment method.--The regulations
shall provide for--
(I) in the case of assumptions made
pursuant to clause (i)(I), projected
annual adjustments in the periodic
payments with respect to future
calendar years based on projected
increases in the Consumer Price Index
(published by the Bureau of Labor
Statistics) for the last calendar
quarter of each future calendar year
over such Index for the last calendar
quarter of the year in which the
determination is made pursuant to
subparagraph (A)(i),
(II) in the case of adjustments
made pursuant to clause (i)(II), an
adjustment with respect to any calendar
year based on the increase in such
Consumer Price Index for the calendar quarter ending September 30 of
the preceding calendar year over such Index for the calendar quarter
ending with September 30, 1999 (in the case of adjustments made
pursuant to clause (i)(II)), and
(III) in either case, adjustment
procedures which are similar to the
procedures used to adjust benefit
amounts under section 215(i)(2)(A) of
the Social Security Act.
Any dollar amount in subparagraph (B)(i), as in effect
for any calendar year (taking into account any
adjustments under this clause), shall apply with
respect to determinations under this paragraph made
during such calendar year of minimum annuity amounts
and of whether an annuity is a minimum annuity.
(7) Personal retirement account.--The term ``personal
retirement account'' has the meaning provided in section 201.
(8) Prescribed employee contribution.--The term
``prescribed employee contribution'' means, with respect to any
eligible individual who is engaged in employment for a covered
employer, an amount equal to 4.0 percent of the wages received
by such employee with respect to such employment.
(9) Prescribed employer contribution.--The term
``prescribed social security employer contribution'' means,
with respect to a covered employer for whom an eligible
individual is engaged in employment, 4.0 percent of the wages
paid by such employer to such individual with respect to
employment of such individual.
(10) Prescribed self-employment contribution.--The term
``prescribed social security self-employment contribution''
means, with respect to the self-employment income of an
eligible individual for any calendar year, 8.0 percent of the
amount of such self-employment income for such calendar year.
(11) Qualified financial institution.--The term ``qualified
financial institution'' means any financial institution if--
(A) such institution is an insured depository
institution (as defined in section 3(c)(2) of the
Federal Deposit Insurance Act) or an insured credit
union (as defined in section 102(7) of the Federal
Credit Union Act), or
(B) there is in effect a certification of the
financial institution by the Securities and Exchange
Commission under title III.
(12) Retirement age.--The term ``retirement age'' has the
meaning provided such term by section 216(l).
(13) Self-employment income.--The term ``self-employment
income'' has the meaning provided in section 211(b) of the
Social Security Act.
(14) Trustee-to-trustee transfer.--The term ``trustee-to-
trustee transfer'' means a transfer by the trustee from a
personal retirement account for the benefit of an individual to
the trustee of another such account for the benefit of such
individual.
(15) Wages.--The term ``wages'' has the meaning provided in
section 209 of the Social Security Act.
TITLE I--CONTRIBUTIONS TO PERSONAL RETIREMENT ACCOUNTS
SEC. 101. PERSONAL RETIREMENT ACCOUNT PAYROLL DEDUCTION PROGRAMS.
(a) In General.--Each person who is a covered employer for any
calendar year shall have in effect throughout such calendar year a
personal retirement accounts payroll deduction program for such
person's employees who are eligible individuals.
(b) Requirements.--For purposes of this title, the term ``personal
retirement account payroll deduction program'' means a written program
maintained by a covered employer if--
(1) under such program, the prescribed employee
contribution is deducted from the wages of each employee who is
an eligible individual and paid as a contribution on behalf of
the employee to a personal retirement account of such employee
designated in accordance with section 102,
(2) under such program, the covered employer makes timely
payment of the amount so deducted as a contribution to the
designated personal retirement account under regulations of the
Securities and Exchange Commission applying the same principles
relating to the timeliness of payment as are applicable under
chapter 62 of the Internal Revenue Code of 1986 with respect to
taxes under chapter 21 of such Code,
(3) under such program, the covered employer pays as a
contribution to the personal retirement account, together with
the contribution paid pursuant to paragraph (2), the prescribed
employer contribution with respect to the employee, and
(4) the employer receives no compensation for the cost of
administering such program.
(c) Amount Deducted May Be Accumulated by Employer in Certain
Cases.--If, under the terms of the governing instruments creating a
personal retirement account selected under section 102, contributions
below a specified amount will not be accepted, the requirements of
subsection (b)(2) shall be treated as met if amounts deducted from the
wages of an employee who is an eligible individual are accumulated by
the covered employer and paid to such account otherwise in accordance
with subsection (b)(2) with reference to the first day on which the
accumulated amount exceeds such specified amount.
SEC. 102. DESIGNATION OF PERSONAL RETIREMENT ACCOUNTS.
(a) In General.--Except as provided in subsection (b), the personal
retirement accounts to which contributions with respect to any employee
who is an eligible individual are required to be paid under section 101
shall be such an account designated by such employee to such employer
not later than 10 business days after the date on which such employee
becomes an employee of such employer. Any such designation shall be
made in such form and manner as may be prescribed in regulations of the
Securities and Exchange Commission.
(b) Designation in Absence of Timely Designation by Employee.--In
any case in which no timely designation of the personal retirement
account is made, the covered employer shall designate such account in
accordance with regulations of the Commission.
(c) Subsequent Substitution of Accounts.--The Commission shall
provide by regulation for subsequent designation of a personal
retirement account by an account holder in lieu of an account
previously designated by such account holder under this section.
SEC. 103. SELF-EMPLOYED INDIVIDUALS.
(a) In General.--In the case of an eligible individual who has
self-employment income for any calendar year, such individual shall
make timely payments to a personal retirement account designated by
such individual of the prescribed self-employment contribution with
respect to such individual for such calendar year in accordance with
regulations of the Securities and Exchange Commission applying the same
principles relating to timeliness of payment as are applicable under
chapter 62 of the Internal Revenue Code of 1986 with respect to taxes
under chapter 2 of such Code.
(b) Designation of Account.--The designation of a personal
retirement account for payment of prescribed self-employment
contributions shall be made in such form and manner as may be
prescribed in regulations of the Securities and Exchange Commission.
SEC. 104. ELECTIVE PARTICIPATION.
(a) Election for Inclusion by Individuals.--
(1) In general.--Any individual may, during calendar year
1998, elect to be included in the definition of ``eligible
individual'' under section 2(4), irrespective of whether such
individual is (or may be as of January 1, 2000) credited with
one or more quarters of coverage under section 213 of the
Social Security Act, by filing with the employer, the Social
Security Administration, and the Securities and Exchange
Commission, in such form and manner as shall be prescribed in
regulations of the Administration (in consultation with the
Commission), a written and signed declaration of such
individual's intention to be treated as an eligible individual
for purposes of this title. Any such filing shall not be final
in the case of an individual who is engaged in employment as of
December 31, 1998, unless a copy of such filing is provided by
the individual to the covered employer during such period.
(2) Irrevocability.--Any election under paragraph (1) shall
be irrevocable and shall be effective with respect to wages
paid, and self-employment income derived, after December 31,
1999.
(3) Subsequent open seasons.--The Commissioner of Social
Security, in consultation with the Securities and Exchange
Commission, may provide by regulation for subsequent periods of
time during which elections under paragraph (1) may be made
periodically (not more frequently that biennially), effective
with respect to wages paid, and self-employment income derived,
after one year after the close of such periods.
SEC. 105. PENALTIES.
(a) Failure To Establish Personal Retirement Account Payroll
Deduction Program.--Any covered employer who fails to meet the
requirements of section 101 for any calendar year shall be subject to a
civil penalty of not to exceed--
(1) $250,000, in the case of an employer who is an
individual, or
(2) $500,000, in any other case.
(b) Failure To Make Deductions Required Under Program.--Any covered
employer who fails to timely deduct in full the amount from the wages
of an employee who is an eligible individual as required under an
applicable personal retirement account payroll deduction program shall
be subject to a civil penalty for each such failure of not to exceed--
(1) $250,000, in the case of an employer who is an
individual, or
(2) $500,000, in any other case.
(c) Failure To Pay Deducted Wages to Personal Retirement Account.--
If an amount deducted under a personal retirement account payroll
deduction program from the wages of an employee who is an eligible
individual is not timely paid in full to the designated personal
retirement account in accordance with section 101, the covered employer
failing to make such payment--
(1) shall be subject to a civil penalty for each such
failure of not to exceed--
(A) $250,000, in the case of an employer who is an
individual, or
(B) $500,000, in any other case, and
(2) shall be liable to the employee for interest on the
unpaid amount at a rate equal to 10 percentage points in excess
of the Federal short-term rate under section 1274(d)(1) of the
Internal Revenue Code of 1986, calculated from the last day by
which such amount was required to be so paid to the date on
which such amount is paid into the designated personal
retirement account.
(d) Failure To Pay Prescribed Self-Employment Contributions to
Personal Retirement Account.--Any eligible individual failing to timely
pay in full a prescribed self-employment contribution to a designated
personal retirement account as required under section 103 shall be
subject to a civil penalty for each such failure of not to exceed
$250,000, plus interest on the unpaid amount at a rate equal to 10
percentage points in excess of the Federal short-term rate under
section 1274(d)(1) of the Internal Revenue Code of 1986, calculated
from the last day by which such amount was required to be so paid to
the date on which such amount is paid into the designated personal
retirement account.
(e) Rules for Application of Section.--
(1) Penalties assessed by securities and exchange
commission.--Any civil penalty assessed by this section shall
be imposed by the Securities and Exchange Commission and
collected in a civil action.
(2) Compromises.--The Commission may compromise the amount
of any civil penalty imposed by this section.
(3) Authority to waive penalty in certain cases.--The
Commission may waive the application of this section with
respect to any failure if the Commission determines that such
failure is due to reasonable cause and not to intentional
disregard of rules and regulations.
TITLE II--PERSONAL RETIREMENT ACCOUNTS
SEC. 201. GENERAL REQUIREMENTS FOR PERSONAL RETIREMENT ACCOUNTS.
(a) In General.--For purposes of this Act, the term ``personal
retirement account'' means a trust created or organized in the United
States for the exclusive benefit of an eligible individual or his
beneficiaries, but only if the written governing instrument creating
the trust meets the following requirements:
(1) No contribution may be made to such trust unless--
(A) such contribution is made pursuant to title I
of this Act, subsection (c) or (d) of this section, or
section 401 of this Act, or
(B) such contribution is a trustee-to-trustee
transfer.
(2) The trustee is a qualified financial institution.
(3) The investment requirements of section 202 shall be
met.
(4) The distribution limitations of section 203 shall be
met.
(5) The insurance requirements of section 204 are met.
(6) The interest of an individual in the balance in his
account is nonforfeitable.
(7) The trustee makes an annual disclosure to each
beneficiary of all fees and other charges imposed by the
trustee with respect to the trust.
(8) The trustee provides to the beneficiary--
(A) on a quarterly basis, an accounting of all
activity of the trust during the preceding quarter, and
(B) on an annual basis, an accounting of all
activity of the trust during the preceding year.
(b) Aggregation of Accounts.--For purposes of determining whether
the requirements of sections 202 and 203 are met in a taxable year, a
predecessor personal retirement account and a successor personal
retirement account of an account holder shall be treated as 1 account.
(c) Contributions to Individual's Nonworking Spouse's Personal
Retirement Account.--
(1) In general.--In the case of an individual to whom this
paragraph applies for the taxable year, there shall be allowed
as a deduction from gross income qualified nonworking spousal
contributions made by such individual for the taxable year.
(2) Maximum amount of deduction.--The amount allowable as a
deduction under paragraph (1) to any individual for any taxable
year shall not exceed--
(A) an amount equal to 5 percent of the taxpayer's
adjusted gross income for the taxable year, reduced
(but not below zero) by
(B) the compensation of such individual's spouse
that is includible in gross income for the taxable
year.
(3) Individuals to whom paragraph (1) applies.--Paragraph
(1) shall apply to any individual if--
(A) such individual files a joint return for the
taxable year, and
(B) the amount of compensation (if any) includible
in such individual's gross income for the taxable year
is greater than the compensation includible in the
gross income of such individual's spouse for the
taxable year.
(d) Additional Contributions to Individual's Own Personal
Retirement Account.--
(1) In general.--An individual may make contributions to
the personal retirement account of the individual for the
taxable year.
(2) Maximum amount of contributions.--The amount allowable
as a contribution under paragraph (1) to any individual for any
taxable year shall not exceed the amount in effect under
section 415(c)(1) of the Internal Revenue Code of 1986
(relating to limitation on contribution to defined contribution
plans), determined by substituting ``individual's'' for
``participant's'' in subparagraph (B) of such section
415(c)(1).
SEC. 202. INVESTMENT REQUIREMENTS.
(a) In General.--The investment requirements of this section are
met with respect to a trust only if--
(1) the risk limitations of subsection (b) are met,
(2) no asset of the trust is--
(A) a life insurance contract (except as provided
in section 204), or
(B) a collectible (as defined in section 408(m) of
the Internal Revenue Code of 1986) other than a coin
described in section 408(m)(3) of such Code,
(3) no asset of the trust is commingled with other property
except in a common trust fund or common investment fund,
(4) no person borrows any money under or by use of such
trust or uses any portion of such trust as security for a loan.
(b) Risk Limitations.--The risk limitations of this subsection are
met only if so much of the balance in the trust as does not exceed the
minimum annuity amount is invested in common stock having a moderate or
lower risk, as determined under regulations which shall be prescribed
by the Securities and Exchange Commission, and forming a portfolio
designed to replicate the performance of a commonly recognized index
comprised of common stock the aggregate market value of which is a
reasonably complete representation of the United States equity markets.
SEC. 203. DISTRIBUTION REQUIREMENTS.
(a) In General.--The distribution requirements of this section are
met with respect to a trust only if--
(1) the distribution timing requirements of subsection (b)
are met, and
(2) the distribution amount requirements of subsection (c)
are met.
(b) Timing Requirements.--
(1) In general.--The distribution timing requirements of
this subsection are met only if--
(A) no distribution may be made from the trust
before the date the account holder attains retirement
age, unless the balance in the trust immediately after
the distribution is not less than the minimum annuity
amount, and
(B) no distribution may be made from the trust
before the date the account holder attains age 62.
(2) Exceptions.--Paragraph (1) shall not apply to--
(A) any trustee-to-trustee transfer, and
(B) any distribution made to a beneficiary (or to
the estate of the employee) on or after the death of
the account holder.
(c) Amount Requirements.--
(1) In general.--The distribution amount requirements of
this subsection are met only if no distribution may be made
from the trust on or after the date the account holder attains
retirement age unless the aggregate amount of distributions for
any year does not exceed the amount which would be payable to
the account holder from the trust under a minimum annuity.
(2) Exceptions.--Paragraph (1) shall not apply to any
distribution if--
(A) subsection (b)(1) does not apply to such
distribution,
(B) the balance in the trust immediately after the
distribution is not less than the minimum annuity
amount, or
(C) the distribution is used to purchase a minimum
annuity.
(d) Cross Reference.--
For penalty on trustee for failure of
trust to meet the distribution requirements of this section, see
section 207.
SEC. 204. INSURANCE REQUIREMENTS.
(a) In General.--The insurance requirements of this section are met
with respect to a trust only if the trustee maintains for each calendar
year insurance on the life of each account holder who--
(1) is married, or
(2) has at least one dependent child with respect to whom
the same requirements are met as are applicable under section
202(d)(1)(B) of the Social Security Act with respect to an
application filed under section 202(d) of such Act.
(b) Required coverage.--Insurance meets the requirements of
subsection (a) only if such insurance provides for a benefit payable
upon the account holder's death to the account holder's spouse (if any)
and to each dependent child (if any) described in subsection (a). Each
such benefit shall be equal to at least the product derived by
multiplying the average indexed monthly earnings (as defined in section
215(b) of the Social Security Act) of the account holder by 36.
SEC. 205. PERSONAL RETIREMENT ACCOUNT EXEMPT FROM INCOME TAX.
Any personal retirement account is exempt from taxation under
subtitle A of the Internal Revenue Code of 1986. Notwithstanding the
preceding sentence, any such account is subject to the taxes imposed by
section 511 of such Code (relating to imposition of tax on unrelated
business income of charitable, etc. organizations).
SEC. 206. TAX TREATMENT OF DISTRIBUTIONS.
(a) In General.--Except as otherwise provided in this section, any
amount paid or distributed out of a personal retirement account shall
be included in the gross income of the account holder for the taxable
year in which the payment or distribution is received. Notwithstanding
any other provision of law, the basis of the account holder in such
account shall be zero.
(b) Exception for Amounts Used To Acquire Minimum or More Generous
Immediate Annuity.--No portion of a payment or distribution out of a
personal retirement account shall be included in gross income so long
as a sufficient portion of such payment or distribution is used within
a reasonable period to acquire an immediate annuity which provides
payments which, on an annual basis, are not less than the payments
under a minimum annuity purchased on the date of such acquisition.
(c) Exception for Transfers Incident to Divorce.--The transfer of
an individual's interest in a personal retirement account to his spouse
or former spouse under a divorce or separation instrument described in
subparagraph (A) of section 71(b)(2) of the Internal Revenue Code of
1986 is not to be considered a taxable transfer for purposes of
subtitle A of the Internal Revenue Code of 1986, and such interest at
the time of the transfer is to be treated as a personal retirement
account of such spouse, and not of such individual. Thereafter such
spouse shall, for purposes of this title, be treated as the account
holder of such account.
SEC. 207. PENALTY ON TRUSTEE FOR FAILURE OF PERSONAL RETIREMENT ACCOUNT
TO MEET REQUIREMENT.
For purposes of section 4975 of the Internal Revenue Code of 1986
(relating to tax on prohibited transactions)--
(1) a personal retirement account shall be treated as a
plan to which such section applies, and
(2) the term ``prohibited transaction'' includes any
failure of a personal retirement account to meet any
requirement of section 202 or 203.
SEC. 208. NOTIFICATION REGARDING INSURED DEPOSITORY INSTITUTIONS.
(a) Notification of Insured Status.--The relevant Federal agency
shall notify the Securities and Exchange Commission of the identity of
each financial institution which is an insured depository institution
or an insured credit union not later than--
(1) in the case of financial institutions which are insured
depository institutions or insured credit unions on the date of
the enactment of this Act, 60 days after such date, or
(2) in any other case, 60 days after the date on which the
institution becomes an insured depository institution or an
insured credit union.
(b) Notification of Termination of Insured Status.--The relevant
Federal agency shall notify the Commission of the termination of a
financial institution's status as an insured depository institution or
an insured credit union not later than the effective date of the
termination of such status.
(c) Relevant Federal Agency.--For purposes of this section, the
term ``relevant Federal agency'' means--
(1) in the case of an insured credit union (as defined in
section 101(7) of the Federal Credit Union Act), the National
Credit Union Administration Board, and
(2) in any other case, the appropriate Federal banking
agency (as defined in section 3(q) of the Federal Deposit
Insurance Act).
SEC. 208. REPORTS.
(a) In General.--The trustee of a personal retirement account shall
make such reports regarding such account to the Securities and Exchange
Commission and to the account holder with respect to contributions (and
the years to which they relate), distributions, and such other matters
as the Commission may require under regulations.
(b) Filing and Furnishing of Reports.--The reports required by this
section--
(1) shall be filed at such time and in such manner as the
Commission prescribes in the regulations prescribed pursuant to
subsection (a), and
(2) shall be furnished to individuals--
(A) not later than January 31 of the calendar year
following the calendar year to which such reports
relate, and
(B) in such manner as the Commission prescribes in
such regulations.
SEC. 210. STUDY ON IMPLEMENTATION OF EARLY RETIREMENT OPTIONS.
(a) In General.--As soon as practicable after the date of the
enactment of this Act, the Securities and Exchange Commission, in
consultation with the Commissioner of Social Security, shall conduct a
study of the best means of providing for options under which
distributions from a personal retirement account established under this
Act may commence in advance of the date on which the account holder
attains retirement age.
(b) Matters To Be Studied.--The study conducted pursuant to
subsection (a) shall consider specifically--
(1) the extent to which minimum levels of assets held in
the account may need to be required as a prerequisite for
distribution of assets from the account at an age earlier than
retirement age, and
(2) possible forms of distribution to which such early
distributions might be restricted,
in order to minimize any adverse affects that such early distributions
might have on retirement income security and to forestall any
likelihood of reliance by the account holder in the future on other
Federal or State benefit programs for financial support.
(c) Reports.--Not later than December 31 of each calendar year
beginning after the date of the enactment of this Act and ending with
2003, the Commission shall transmit to the President and to each House
of the Congress interim reports on the progress of the study being
conducted under subsection (a). Not later than December 31, 2004, the
Commission shall submit to the President and to each House of the
Congress a final report on the study conducted under subsection (a)
setting forth the Commission's conclusions and recommendations. The
report shall include any recommendations for legislation that the
Commission considers necessary or appropriate, together with suggested
legislative language necessary to carry out such recommendations.
TITLE III--CERTIFICATION OF FINANCIAL INSTITUTIONS OTHER THAN INSURED
DEPOSITORY INSTITUTIONS
SEC. 301. CERTIFICATION OF FINANCIAL INSTITUTIONS BY THE SECURITIES AND
EXCHANGE COMMISSION.
(a) In General.--Any financial institution may apply to the
Securities and Exchange Commission (in such form and manner as shall be
provided by the Commission by regulation) for certification under this
title.
(b) Review Requirements.--In reviewing any application for
certification under this title and determining whether to approve the
application for certification, the Commission shall consider the
following factors:
(1) The financial history and condition of the financial
institution.
(2) The adequacy of the financial institution's capital
structure.
(3) The future earnings prospects of the financial
institution.
(4) The general character and fitness of the management of
the financial institution.
(5) The risk presented by such financial institution to the
Social Security Savings Guaranty Trust Fund.
(6) The convenience and needs of individuals who are
account holders with respect to personal retirement accounts
for which the institution is to serve as trustee.
(7) Whether the financial institution's corporate powers
are consistent with the purposes of this Act.
(c) Notice of Denial of Application for Certification.--If the
Commission votes to deny any application for certification by any
financial institution, the Commission shall promptly notify the
financial institution of the denial of such application, giving
specific reasons in writing for the Commission's determination with
reference to the factors described in subsection (b).
(d) Nondelegation Requirement.--The authority of the Commission to
make any determination to deny any application under this section may
not be delegated by the Commission.
SEC. 302. ACCESS TO RECORDS.
(a) In General.--The Securities and Exchange Commission may from
time to time require any certified financial institution to file such
reports as the Commission may deem advisable for purposes of this
title.
(b) Reports by Certified Financial Institutions.--
(1) In general.--Each such report shall contain a
declaration by the president, by a vice president, by the
cashier or the treasurer, or by any other officer designated by
the board of directors or trustees of the reporting certified
financial institution to make such declaration, that the report
is true and correct to the best of his knowledge and belief.
The correctness of such report shall be attested by the
signatures of at least two directors or trustees of the
reporting certified financial institution other than the
officer making such declaration, with a declaration that the
report has been examined by them and to be the best of their
knowledge and belief is true and correct. At the time of making
such reports each certified financial institution shall furnish
to the Commission a copy thereof containing such signed
declaration and attestations. Nothing in this paragraph shall
be construed to preclude any Federal or State agency or
instrumentality from requiring a certified financial
institution under its jurisdiction to make additional reports
at any time.
(2) Information to be provided.--In the reports required to
be made by paragraph (1), each certified financial institution
shall report the total amount of the liability of the
institution for balances maintained in personal retirement
accounts for which such institution serves as trustee.
(3) Data collections.--In addition to or in connection with
any other report required under this subsection, the Commission
shall take such action as may be necessary to ensure that--
(A) each certified financial institution maintains;
and
(B) the Commission receives on a regular basis from
such institution,
information on the total amount of all liability of the
institution for balances maintained in personal retirement
accounts for which such institution serves as trustee. In
prescribing reporting and other requirements for the collection
of actual and accurate information pursuant to this paragraph,
the Commission shall minimize the regulatory burden imposed
upon certified financial institutions while taking into account
the benefit of the information to the Commission in carrying
out its functions under this title.
SEC. 303. REVOCATION OF CERTIFICATION.
(a) Voluntary Revocation.--Any financial institution may revoke
such institution's status as a certified financial institution if such
institution provides written notice to the Securities and Exchange
Commission of the institution's intent to revoke such status not less
than 90 days before the effective date of such revocation.
(b) Involuntary Revocation.--
(1) Notice to primary regulator.--
(A) In general.--If the Commission determines
that--
(i) a certified financial institution or
the directors or trustees of a certified
financial institution have engaged or are
engaging in unsafe or unsound practices in
conducting the business of the institution,
(ii) a certified financial institution is
in an unsafe or unsound condition to continue
operations as a certified financial
institution, or
(iii) a certified financial institution or
the directors or trustees of the institution
have violated any applicable law, regulation,
order, condition imposed in writing by the
Commission in connection with the approval of
any application or other request by the
institution, or written agreement entered into between the institution
and the Commission,
and the Commission determines that any unsafe or
unsound practice or condition or any violation
specified in such notice requires the revocation of the
certified status of the certified financial
institution, the Commission shall take the actions
required under subparagraph (B).
(B) Required actions.--If the Commission makes the
determination under subparagraph (A) with respect to a
certified financial institution, the Commission shall--
(i) serve written notice to the certified
financial institution of the Commission's
intention to revoke the certified status of the
institution;
(ii) provide the certified financial
institution with a statement of the charges on
the basis of which the determination to revoke
such institution's certified status was made;
and
(iii) notify the certified financial
institution of the date (not less than 30 days
after notice under this paragraph) and place
for a hearing before the Commission (or any
person designated by the Commission) with
respect to the revocation of the institution's
certified status.
(2) Hearing; revocation.--If, on the basis of the evidence
presented at a hearing before the Commission (or any person
designated by the Commission for such purpose), in which all
issues shall be determined on the record pursuant to section
554 of title 5, United States Code, and the written findings of
the Commission (or such person) with respect to such evidence
(which shall be conclusive), the Commission finds that any
unsafe or unsound practice or condition or any violation
specified in the notice to a certified financial institution
under paragraph (1) has been established, the Commission may
issue an order revoking the certified status of such
institution effective as of a date subsequent to such finding.
(3) Appearance; consent to revocation.--Unless the
institution appears at the hearing by a duly authorized
representative, it shall be deemed to have consented to the
revocation of its status as a certified financial institution
and revocation of such status thereupon may be ordered.
(4) Publication of notice of revocation.--The Commission
may publish notice of such revocation and the institution shall
give notice of such revocation to the account holder of each
personal retirement account for which the institution serves as
trustee at his last address of record on the books of the
institution, in such manner and at such time as the Commission
may find to be necessary and may order for the protection of
account holders.
(5) Temporary continuance of certification as of
revocation.--After the Commission has determined under the
provisions of this subsection that the certified status of any
financial institution is to be revoked, the certification of
the institution shall continue for a period of at least 6
months or up to 2 years, within the discretion of the
Commission. No further contributions may be made to any
personal retirement account for which the institution serves as
trustee after the date of such determination of the Commission,
and the institution shall not advertise or hold itself out as
being a qualified financial institution unless in the same
connection it shall also state with equal prominence that such
contributions may not be made. Such institution shall, in all
other respects, be subject to the duties and obligations of a
qualified financial institution for the period referred to in
the first sentence of this paragraph from the date of such
revocation, and the Commission shall have the same powers and
rights with respect to such institution as in the case of a
qualified financial institution.
(6) Temporary suspension of certification.--
(A) In general.--If the Commission initiates a
revocation proceeding under paragraph (1), and the
Commission, after consultation with any appropriate
regulatory agency with jurisdiction over the financial
institution, finds that the institution has no tangible
capital under the capital guidelines or regulations of
regulatory agency, the Commission may issue a temporary
order suspending certification of the institution.
(B) Effective period of temporary order.--Any order
issued under subparagraph (A) shall become effective
not earlier than 10 days from the date of service upon
the institution and, unless set aside, limited, or
suspended by a court in proceedings authorized under
this paragraph, such temporary order shall
remain effective and enforceable until an order of the Commission under
paragraph (2) becomes final or until the Commission dismisses the
proceedings under paragraph (2).
(C) Judicial review.--Before the close of the 10-
day period beginning on the date any temporary order
has been served upon the institution under subparagraph
(A), the institution may apply to the United States
District Court for the District of Columbia, or the
United States district court for the judicial district
in which the home office of the institution is located,
for an injunction setting aside, limiting, or
suspending the enforcement, operation, or effectiveness
of such order, and such court shall have jurisdiction
to issue such injunction.
(D) Publication of order.--The institution shall
give notice of such order to the account holder of each
personal retirement account for which the institution
serves as trustee in such manner and at such times as
the Commission may find to be necessary and may order
for the protection of account holders.
(E) Notice by commission.--If the Commission
determines that the institution has not substantially
complied with the notice to contributors required by
the Commission, the Commission may provide such notice
in such manner as the Commission may find to be
necessary and appropriate.
(7) Final decisions to revoke certification.--Any decision
by the Commission to--
(A) issue a temporary order revoking certification;
or
(B) issue a final order revoking certification;
shall be made by the Commission and may not be delegated.
(8) Judicial review.--Any party to any proceeding under
this subsection to which a financial institution is a party may
obtain a review of any order served pursuant to this subsection
by the filing in the court of appeals of the United States for
the circuit in which the home office of the financial
institution is located, or in the United States Court of
Appeals for the District of Columbia Circuit, within 30 days
after the date of service of such order, a written petition
praying that the order of the Commission be modified,
terminated, or set aside. A copy of such petition shall be
forthwith transmitted by the clerk of the court to the
Commission, and thereupon the Commission shall file in the
court the record in the proceeding, as provided in section 2112
of title 28, United States Code. Upon the filing of such
petition, such court shall have jurisdiction, which upon the
filing of the record shall be exclusive, to affirm, modify,
terminate, or set aside, in whole or in part, the order of the
Commission. Review of such proceedings shall be had as provided
in chapter 7 of title 5, United States Code. The judgment and
decree of the court shall be final, except that the judgment
and decree shall be subject to review by the Supreme Court upon
certiorari, as provided in section 1254 of title 28, United
States Code. The commencement of proceedings for judicial
review under this paragraph shall not, unless specifically
ordered by the court, operate as a stay of any order issued by
the Commission.
TITLE IV--PERSONAL RETIREMENT ACCOUNT INSURANCE
SEC. 401. GUARANTEES AND SUPPLEMENTAL MINIMUM BENEFIT PAYMENTS.
(a) Distributions From Personal Retirement Accounts Guaranteed.--In
any case in which the Securities and Exchange Commission declares an
insurable event with respect to a qualified financial institution
serving as trustee of a personal retirement account, subject to the
limitations contained in subsection (b), the Commission shall
guarantee, in accordance with this section, the timely distribution of
the balance in such account to the account holder in accordance with
the terms governing such account and the provisions of this Act.
(b) Limitation.--The amount of any account balance, the
distribution of which is subject to the Commission's guarantee under
subsection (a), shall not exceed the minimum annuity amount.
(c) Aggregate Limit on Amount Guaranteed.--Notwithstanding the
preceding provisions of this section, no person shall receive from the
Commission, pursuant to a guarantee by the Commission with respect to
all personal retirement accounts for which such person is the account
holder, an amount which, in the aggregate, exceeds the minimum annuity
amount.
(d) Insurable Event.--For purposes of subsection (a), any of the
following shall constitute an insurable event with respect to a
qualified financial institution serving as trustee of a personal
retirement account:
(1) the termination of the qualified status of a the
institution;
(2) inability of the qualified financial institution to
make full distributions of the balance in the account when due;
and
(3) termination of the account under section 405.
(e) Minimum Distribution Level Guarantee.--In addition to the
guarantee provided under subsection (a), the Commission shall guarantee
a minimum distribution from the account as of the normal retirement
date in the amount of the minimum annuity amount, notwithstanding that
the balance in the account as of such date is less than the minimum
annuity amount, if--
(1) the account holder was not credited with any quarters
of coverage under section 213 of the Social Security Act as of
January 1, 2000,
(2) as of the normal retirement date, no distributions have
been made by the individual from such account holder's personal
retirement account,
(3) the Commission determines that the failure of the
balance in the account to attain the level of the minimum
annuity amount as of the normal retirement date is due to
inadvertent and substantial investment losses occurring during
the 90-day period ending with such date.
(f) Alternative Guarantee Arrangements.--The Commission shall also
provide for a range of alternative guarantee arrangements providing for
timely distribution of all, or a larger portion, of the balance in the
personal retirement account to the account holder, which may be elected
by the account holder upon payment to the commission of supplemental
premiums.
(g) Substitution of Private Insurance.--The Commission shall
provide by regulation for substitution, at the election of the account
holder, of private insurance secured by the account holder or by the
trustee of the account holder's personal retirement account, providing
for a guarantee of timely distribution of the balance in the account to
the account holder, which is at least equivalent to the guarantee
provided for under subsection (a)
(h) Payment of Guarantees.--To the extent that amounts subject to a
guarantee provided for under subsection (a), (e), (f), or (g) are not
payable from the personal retirement account, such amounts shall be
payable from the Social Security Savings Insurance Trust Fund.
(i) Entitlement to Supplemental Minimum Benefit Payment to
Account.--
(1) In general.--In any case in which--
(A) an account holder attains retirement age and,
as of the normal retirement date, is a fully insured
individual (as defined in section 214(a) of the Social
Security Act),
(B) as of the normal retirement date, no
distributions have been made by the individual from
such account holder's personal retirement account,
(C) as of the normal retirement date, the balance
in the personal retirement account (before any
distributions on such date) is less than the minimum
annuity amount, and
(D) the guarantee under subsection (e) does not
apply with respect to the balance in the personal
retirement account,
the account holder, upon application to the Commission filed by
the account holder or the trustee of the account on or after
the normal retirement date and in such form and manner as shall
be prescribed by the Commission, shall be entitled to a
supplemental minimum benefit payment to such account. Upon
receipt of such application, the Commission shall certify to
the Secretary of the Treasury the amount of such payment, and
the Secretary shall pay the amount of such payment to such
account in accordance with such certification from funds
otherwise available in the general fund of the Treasury.
(2) Amount of supplemental minimum benefit payment.--The
amount of a supplemental minimum benefit payment payable to an
eligible individual's account under paragraph (1) is the excess
(if any) of--
(A) the minimum annuity amount as of the normal
retirement date, over
(B) the balance in such account as of such date.
(j) Protection From Assignment or Alienation.--Any amount subject
to any guarantee provided for under subsection (a), (e), (f), or (g)
and any supplmental minimum benefit payment under subsection (i) may
not be assigned or alienated.
(k) Normal Retirement Date.--For purposes of this section, the term
``normal retirement date'' means, in connection with an account holder,
the date on which the account holder attains retirement age (or, if
such date is not a business day, the date which is the first business
day thereafter).
SEC. 402. ASSESSMENTS OF QUALIFIED FINANCIAL INSTITUTIONS BY THE
COMMISSION.
(a) Risk-Based Assessment System.--
(1) Risk-based assessment system required.--The Securities
and Exchange Commission shall, by regulation, establish a risk-
based assessment system for qualified financial institutions serving as
trustee of a personal retirement account.
(2) Private reinsurance authorized.--In carrying out this
section, the Commission may--
(A) obtain private reinsurance covering not more
than 10 percent of any loss the Commission incurs with
respect to a qualified financial institution serving as
trustee of a personal retirement account; and
(B) base that institution's semiannual assessment
(in whole or in part) on the cost of the reinsurance.
(3) Risk-based assessment system defined.--For purposes of
this section, the term ``risk-based assessment system'' means a
system for calculating a qualified financial institution's
semiannual assessment based on--
(A) the probability that the Social Security
Savings Guarantee Trust Fund will incur a loss with
respect to the institution, taking into consideration
the risks attributable to--
(i) different categories and concentrations
of assets;
(ii) different categories and
concentrations of liabilities, both insured and
uninsured, contingent and noncontingent; and
(iii) any other factors the Commission
determines are relevant to assessing such
probability;
(B) the likely amount of any such loss; and
(C) the revenue needs of the Trust Fund.
(4) Separate assessment systems.--The Commission may
establish separate risk-based assessment systems for large and
small qualified financial institutions.
(b) Setting Assessments.--
(1) Achieving and maintaining designated reserve ratio.--
(A) In general.--The Commission shall set
semiannual assessments for qualified financial
institutions--
(i) to maintain the reserve ratio of the
Trust Fund at the designated reserve ratio; or
(ii) if the reserve ratio is less than the
designated reserve ratio, to increase the
reserve ratio to the designated reserve ratio
as provided in subsection (c).
(B) Factors to be considered.--In carrying out
subparagraph (A), the Commission shall consider the
Trust Fund's--
(i) expected operating expenses,
(ii) case resolution expenditures and
income,
(iii) the effect of assessments on earnings
and capital of qualified financial
institutions, and
(iv) any other factors that the Commission
may deem appropriate.
(C) Minimum assessment.--The semiannual assessment
for each qualified financial institution shall be not
less than $1,000.
(D) Designated reserve ratio defined.--The
designated reserve ratio of the Trust Fund for each
year shall be--
(i) 1.25 percent of so much of the total of
the estimated balances in personal retirement
accounts as is subject to the Commission's
guarantee under this title, in the aggregate;
or
(ii) a higher percentage of estimated
balances in such accounts that the Commission
determines to be justified for that year by
circumstances raising a significant risk of
substantial future losses to the Trust Fund.
(2) Notice of assessments.--The Commission shall notify
each qualified financial institution of that institution's
semiannual assessment.
(3) Special rule until the trust fund achieves the
designated reserve ratio.--Until the Trust Fund achieves the
designated reserve ratio, the Commission may provide for
uniform percentage increases in assessments on qualified
financial institutions under the risk-based assessment system
authorized under subsection (a) to not more than 10 basis
points above the assessments on qualified financial
institutions under that system which would be necessary, if the
Trust Fund had achieved the designated reserve ratio, to
maintain the reserve ratio of the Trust Fund at the designated
reserve ratio.
(c) Special Rule for Recapitalizing Undercapitalized Trust Fund.--
(1) In general.--If the reserve ratio of the Trust Fund is
less than the designated reserve ratio under subsection
(b)(1)(D), the Commission shall set semiannual assessment rates
for qualified financial institutions--
(A) that are sufficient to increase the reserve
ratio for the Trust Fund to the designated reserve
ratio not later than 1 year after such rates are set;
or
(B) in accordance with a schedule promulgated by
the Commission under paragraph (2).
(2) Recapitalization schedule.--For purposes of paragraph
(1)(B), the Commission shall by regulation promulgate a
schedule that specifies, at semiannual intervals, target
reserve ratios for the Trust Fund, culminating in a reserve
ratio that is equal to the designated reserve ratio not later
than 15 years after the date on which the schedule is
implemented.
(d) Semiannual Period Defined.--For purposes of this section, the
term ``semiannual period'' means a period beginning on January 1 of any
calendar year and ending on June 30 of the same year, or a period
beginning on July 1 of any calendar year and ending on December 31 of
the same year.
(e) Records To Be Maintained.--Each qualified financial institution
shall maintain all records that the Commission may require for
verifying the correctness of the institution's semiannual assessments.
No qualified financial institution shall be required to retain those
records for that purpose for a period of more than 5 years from the
date of the filing of any certified statement, except that when there
is a dispute between the qualified financial institution and the
Commission over the amount of any assessment, the institution shall
retain the records until final determination of the issue.
(f) Emergency Special Assessments.--In addition to the other
assessments on qualified financial institutions under this section, the
Commission may impose one or more special assessments on qualified
financial institutions in an amount determined by the Commission if the
amount of any such assessment is necessary--
(1) to provide sufficient assessment income to repay
amounts borrowed from the Secretary of the Treasury under
section 403(c) amounts due during the period with respect to
which such assessment is imposed; or
(2) for any other purpose the Commission may deem
necessary.
(g) Certified Statements; Payments.--
(1) Certified statements required.--
(A) In general.--Each qualified financial
institution shall file with the Commission a certified
statement containing such information as the Commission
may require for determining the institution's
semiannual assessment.
(B) Form of certification.--The certified statement
required under subparagraph (A) shall--
(i) be in such form and set forth such
supporting information as the Commission shall
prescribe; and
(ii) be certified by the president of the
qualified financial institution or any other
officer designated by its board of directors or
trustees that to the best of his or her
knowledge and belief, the statement is true,
correct and complete, and in accordance with
this Act and regulations issued hereunder.
(2) Payments required.--
(A) In general.--Each qualified financial
institution shall pay to the Commission the semiannual
assessment imposed under subsection (b).
(B) Form of payment.--The payments required under
subparagraph (A) shall be made in such manner and at
such time or times as the Commission shall prescribe by
regulation.
(3) Newly insured institutions.--To facilitate the
administration of this section, the Commission may waive the
requirements of paragraphs (1) and (2) for the semiannual
period in which a financial institution becomes a qualified
financial institution.
(4) Penalty for failure to make accurate certified
statement.--
(A) First tier.--Any qualified financial
institution which--
(i) maintains procedures reasonably adapted
to avoid any inadvertent error and,
unintentionally and as a result of such an
error, fails to submit the certified statement
under paragraph (1) within the period of time
required under paragraph (1) or submits a false
or misleading certified statement; or
(ii) submits the statement at a time which
is minimally after the time required in such
paragraph,
shall be subject to a penalty of not more than $2,000
for each day during which such failure continues or
such false and misleading information is not corrected. The institution
shall have the burden of proving that an error was inadvertent or that
a statement was inadvertently submitted late.
(B) Second tier.--Any qualified financial
institution which fails to submit the certified
statement under paragraph (1) within the period of time
required under paragraph (1) or submits a false or
misleading certified statement in a manner not
described in subparagraph (A) shall be subject to a
penalty of not more than $20,000 for each day during
which such failure continues or such false and
misleading information is not corrected.
(C) Third tier.--Notwithstanding subparagraphs (A)
and (B), if any qualified financial institution
knowingly or with reckless disregard for the accuracy
of any certified statement described in paragraph (1)
submits a false or misleading certified statement under
paragraph (1), the Commission may assess a penalty of
not more than $1,000,000 or not more than 1 percent of
the total assets of the institution, whichever is less,
per day for each day during which the failure continues
or the false or misleading information in such
statement is not corrected.
(h) Penalties for Late Payment.--If any assessment or penalty under
this section is not paid when it is due the Commission is authorized to
assess a late payment charge of not more than 100 percent of the
payment which was not timely paid. The preceding sentence shall not
apply to any payment made within 60 days after the date on which a
payment is due, if before such date, the person required to make such
payment obtains a waiver from the Commission based upon a showing of
substantial hardship arising from the timely payment. The Commission is
authorized to grant a waiver under this subsection upon application
made by such person, but the Commission may not grant a waiver if it
appears that such person will be unable to make the payment within 60
days after the date on which it is due. If any payment is not made by
the last date prescribed for a payment, interest on the amount of such
payment at the rate imposed under section 6601(a) of the Internal
Revenue Code of 1986 (relating to interest on underpayment, nonpayment,
or extensions of time for payment of tax) shall be paid for the period
from such last date to the date paid.
(i) Civil Action.--If any person required to make such payment
fails to make the payment when due, the Commission is authorized to
bring a civil action in any district court of the United States within
the jurisdiction of which the assets of the personal retirement account
are located, the account is administered, or in which a defendant
resides or is found for the recovery of the amount of the unpaid amount
(including penalties and interest), and process may be served in any
other district. The district courts of the United States shall have
jurisdiction over actions brought under this subsection by the
Commission without regard to the amount in controversy.
(j) Guarantee Preserved.--The Commission shall not cease its
guarantee on account of the failure of any person to pay any amount
when due under this section.
SEC. 403. ESTABLISHMENT OF SOCIAL SECURITY SAVINGS INSURANCE TRUST
FUND.
(a) Establishment.--There is established on the books of the
Treasury of the United States a Social Security Savings Insurance Trust
Fund to be used by the Securities and Exchange Commission in carrying
out its duties under this title. Whenever in this title reference is
made to the term ``Trust Fund'' the reference shall be considered to
refer to the Trust Fund established under this subsection.
(b) Flow of Funds.--
(1) Credits to trust fund.--The Trust Fund shall be
credited with the appropriate portion of--
(A) funds borrowed under subsection (c),
(B) assessments, penalties, and interest collected
under this title,
(C) earnings on investments of the Trust Fund or on
assets credited to the Trust Fund under this
subsection,
(D) attorney's fees awarded to the Commission, and
(E) receipts from any other operations under this
title.
(2) Debits from trust fund.--Subject to the provisions of
subsection (a), the Trust Fund shall be available--
(A) for making such payments as the Commission
determines are necessary to pay amounts guaranteed
under section 301,
(B) to purchase assets from a qualified financial
institution ceasing to be a qualified financial
institution when the Commission determines such
purchase will best protect the interests of the
Commission,
(C) to repay to the Secretary of the Treasury such
sums as may be borrowed (together with interest
thereon) under subsection (c),
(D) to pay the operational and administrative
expenses of the Commission under this title, including
reimbursement of the expenses incurred by the
Department of the Treasury in maintaining the funds,
and the Comptroller General in auditing the Commission,
and
(E) to pay to account holders the amounts which are
guaranteed by the Commission under this title with
respect to any personal retirement account maintained
by a financial institution which is unable to pay such
amounts when due.
(3) Investment of trust fund assets.--Whenever the
Commission determines that the moneys of the Trust Fund are in
excess of current needs, it may request the investment of such
amounts as it determines advisable by the Secretary of the
Treasury in obligations issued or guaranteed by the United
States but, until all borrowings under subsection (c) have been
repaid, the obligations in which such excess moneys are
invested may not yield a rate of return in excess of the rate
of interest payable on such borrowings.
(c) Issuance of Obligations.--The Commission is authorized to issue
to the Secretary of the Treasury notes or other obligations in an
aggregate amount of not to exceed $100,000,000, in such forms and
denominations, bearing such maturities, and subject to such terms and
conditions as may be prescribed by the Secretary of the Treasury. Such
notes or other obligations shall bear interest at a rate determined by
the Secretary of the Treasury, taking into consideration the current
average market yield on outstanding marketable obligations of the
United States of comparable maturities during the month preceding the
issuance of such notes or other obligations of the Commission. The
Secretary of the Treasury is authorized and directed to purchase any
notes or other obligations issued by the Commission under this
subsection, and for that purpose he is authorized to use as a public
debt transaction the proceeds from the sale of any securities issued
under chapter 31 of title 31, United States Code, and the purposes for
which securities may be issued under that chapter are extended to
include any purchase of such notes and obligations. The Secretary of
the Treasury may at any time sell any of the notes or other obligations
acquired by him under this subsection. All redemptions, purchases, and
sales by the Secretary of the Treasury of such notes or other
obligations shall be treated as public debt transactions of the United
States.
(d) Dedicated Amounts.--Amounts in the Trust Fund may be used only
for the purposes for which the Trust Fund was established and may not
be used to make loans to (or on behalf of) any other fund or to finance
any other activity of the Commission. None of the funds borrowed under
subsection (c) may be used to make loans to (or on behalf of) any other
fund.
(e) Voting of Stock.--Any stock in a person liable to the
Commission under this title which is paid to the Commission by such
person or a member of such person's controlled group in satisfaction of
such person's liability under this title may be voted only by the
custodial trustees or outside money managers of the Commission.
SEC. 404. INSTITUTION OF TERMINATION PROCEEDINGS BY THE COMMISSION.
(a) In General.--The Securities and Exchange Commission may
institute proceedings under this section to terminate a personal
retirement account whenever it determines that the possible long-run
loss of the Commission with respect to the account may reasonably be
expected to increase unreasonably if the account is not terminated. The
Commission shall as soon as practicable institute proceedings under
this section to terminate a personal retirement account whenever the
Commission determines that an insurable event under paragraph (1) or
(2) of section 401(d) has occurred. The Commission may prescribe a
simplified procedure to follow in terminating personal retirement
accounts as long as that procedure includes substantial safeguards for
the rights of the account holder. Notwithstanding any other provision
of this title, the Commission is authorized to pool assets of
terminated personal retirement accounts for purposes of administration,
investment, payment of liabilities of all such accounts, and such other
purposes as it determines to be appropriate in the administration of
this title.
(b) Initial Appointment of Alternative Trustee.--
(1) In general.--Whenever the Commission makes a
determination under subsection (a) with respect to a personal
retirement account, it may, upon notice to the financial
institution serving as trustee of the account, apply to the
appropriate United States district court for the appointment of
an alternative trustee to administer the account pending the
issuance of a decree under subsection (c) ordering the
termination of the account. If within 3 business days after the
filing of an application under this subsection, or such other
period as the court may order, the financial institution consents to
the appointment of an alternative trustee, or fails to show why an
alternative trustee should not be appointed, the court may grant the
application and appoint an alternative trustee to administer the
account in accordance with the terms governing the account until the
Commission determines that the account should be terminated or that
termination is unnecessary. The Commission may request that it be
appointed as trustee of the account in any case.
(2) Standard for court appointment.--Notwithstanding any
other provision of this Act, upon the petition of a qualified
financial institution or the Commission, the appropriate United
States district court may appoint an alternative trustee in
accordance with the provisions of this section if the interests
of the account holder with respect to the personal retirement
account is maintained would be better served by the appointment
of the alternative trustee.
(3) Appointment by agreement between parties.--The
Commission and the qualified financial institution may agree to
the appointment of an alternative trustee without proceeding in
accordance with the requirements of paragraphs (1) and (2).
(c) Termination Proceedings.--
(1) In general.--If the Commission is required under
subsection (a) to commence proceedings under this section with
respect to a personal retirement account or, after issuing a
notice under this section to the qualified financial
institution serving as trustee of the account, has determined
that the account should be terminated, the Commission may, upon
notice to the institution, apply to the appropriate United
States district court for a decree adjudicating that the
account must be terminated in order to protect the interests of
the account holder with respect to the account or to avoid any
unreasonable deterioration of the financial condition of the
account or any unreasonable increase in the liability of the
Trust Fund. If the alternative trustee appointed under
subsection (b) disagrees with the determination of the
Commission under the preceding sentence, he may intervene in
the proceeding relating to the application for the decree, or
make application for such decree himself. Upon granting a
decree for which the Commission or alternative trustee has
applied under this subsection, the court shall authorize the
alternative trustee (or appoint an alternative trustee if one
has not been appointed under such subsection and authorize him)
to assume trusteeship of the personal retirement account, and
provide for its liquidation, in accordance with the provisions
of this section, and a transfer of its assets to a successor
personal retirement account, in accordance with paragraph (2).
(2) Transfer to successor account.--In any case in which a
personal retirement account is terminated under this section,
the Commission shall provide by regulation for procedures under
which selection for the account holder of an appropriate
successor personal retirement account is facilitated and a
trustee-to-trustee transfer of the balance in the terminated
account to the successor account is made. Whenever an
alternative trustee appointed under this section is exercising
trusteeship authority over a personal retirement account with
discretion as to the date upon which transfer of the assets
from the account to a successor account is to be performed, the
alternative trustee shall notify the Commission at least 10
days before the date on which he proposes to perform such
transfer.
(d) Trusteeship Without Termination.--If the Commission and the
financial institution agree that trusteeship over the personal
retirement account should be assumed by an alternative trustee
appointed under this section and agree to the appointment of an
alternative trustee without proceeding in accordance with the
requirements of subsection (c), the alternative trustee shall have the
power described in subsection (e)(1) of this section and, in addition
to any other duties imposed on the alternative trustee under law or by
agreement between the Commission and the financial institution, the
alternative trustee is subject to the duties described in subsection
(e)(3).
(e) Powers and Duties of Alternative Trustee.--
(1) In general.--An alternative trustee appointed under
subsection (b) shall have the power--
(A) to do any act authorized by documents governing
the personal retirement account or this title to be
done by the financial institution as trustee of the
account;
(B) to require the transfer of all (or any part) of
the assets and records of the account to himself as
trustee;
(C) to invest any assets of the account which he
holds in accordance with the documents governing the
account, regulations of the Commission and the
Securities and Exchange Commission, and applicable
rules of law;
(D) to limit payment of assets in the account to
assets guaranteed under this title as appropriate or to
continue payment of some or all of the assets in the
account which were being paid prior to his appointment;
(E) to do such other acts as he deems necessary to
continue operation of the account without increasing
the potential liability of the Commission, if such acts
may be done under the documents governing the account;
and
(F) to require the financial institution to furnish
any information with respect to the account which the
alternative trustee may reasonably need in order to
administer the account.
(2) Time limitation on alternative trusteeship where
termination does not ensue.--If the court to which application
is made under subsection (c) dismisses the application with
prejudice, or if the Commission fails to apply for a decree
under subsection (c) within 30 days after the date on which the
alternative trustee is appointed under subsection (b), the
alternative trustee shall transfer all assets and records of
the account held by him to the financial institution which had been
serving as trustee of the account within 3 business days after such
dismissal or the expiration of such 30-day period, and shall not be
liable to the financial institution or any other person for his acts as
alternative trustee except for willful misconduct, or for conduct in
violation of any other provision of this Act. The 30-day period
referred to in this paragraph may be extended as provided by agreement
between the financial institution and the Commission or by court order
obtained by the Commission.
(3) Additional powers upon termination.--If the court to
which an application is made under subsection (c) issues the
decree requested in such application, in addition to the powers
described in paragraph (1), the alternative trustee shall have
the power--
(A) to collect for the account any amounts due the
account, including but not limited to the power to
collect from the persons obligated to meet the
contribution requirements of title I or the terms of
the documents governing the account;
(B) to receive any payment made by the Commission
to the account under this title;
(C) to commence, prosecute, or defend on behalf of
the financial institution or the account any suit or
proceeding involving the account;
(D) to issue, publish, or file such notices,
statements, and reports as may be required by the
Commission or any order of the court;
(E) to liquidate the assets of the account and
perform the transfer of such assets to a successor
personal retirement account as provided in subsection
(c)(2);
(F) to recover payments inappropriately made from
the account; and
(G) to do such other acts as may be necessary to
comply with this Act or any order of the court and to
protect the interests of the account holder of the
terminated account.
(4) Notice of proceedings.--As soon as practicable after
his appointment, the alternative trustee shall give notice to
interested parties of the institution of proceedings under this
section to determine whether the account should be terminated
or to terminate the account, whichever is applicable. For
purposes of this paragraph, the term ``interested party''
means--
(A) the financial institution,
(B) the account holder with respect to the account
was maintained, including the beneficiary of the
account holder who is deceased,
(C) each person who may be subject to liability
under section 406, and
(D) each person who may be liable for payments to
the account.
(5) Additional duties.--Except to the extent inconsistent
with the provisions of this Act, or as may be otherwise ordered
by the court, an alternative trustee appointed under this
section shall be subject to the same duties as those of a
trustee under section 704 of title 11, United States Code, and
shall be, with respect to the account, a fiduciary within the
meaning of paragraph (21) of section 3 of the Employee
Retirement Income Security Act of 1974 and under section
4975(e) of the Internal Revenue Code of 1986 (except to the
extent that the provisions of this title are inconsistent with
the requirements applicable under part 4 of subtitle B of title
I of such Act and of such section 4975).
(f) Coordination with Bankruptcy or Other Insolvency Proceedings.--
An application by the Commission under this section may be filed
notwithstanding the pendency in the same or any other court of any
bankruptcy, mortgage foreclosure, or equity receivership proceeding, or
any proceeding to reorganize, conserve, or liquidate the personal
retirement account or the financial institution, or its assets, or any
proceeding to enforce a lien against assets of the account or the
institution.
(g) Court Jurisdiction.--Upon the filing of an application for the
appointment of an alternative trustee or the issuance of a decree under
this section, the court to which an application is made shall have
exclusive jurisdiction of the account involved and its assets wherever
located with the powers, to the extent consistent with the purposes of
this section, of a court of the United States having jurisdiction over
cases under chapter 11 of title 11 of the United States Code. Pending
an adjudication under subsection (c), such court shall stay, and upon
appointment by it of an alternative trustee, as provided in this
section, such court shall continue the stay of, any pending mortgage
foreclosure, equity receivership, or other proceeding to reorganize,
conserve, or liquidate the account or its assets and any other suit
against any receiver, conservator, or trustee of the account or the
financial institution, or its assets. Pending such adjudication and
upon the appointment by it of such alternative trustee, the court may
stay any proceeding to enforce a lien against property of the account
or the financial institution or any other suit against the account or
the financial institution.
(h) Venue and Process.--An action under this subsection may be
brought in the judicial district where the financial institution
serving as trustee of the personal retirement account is located or
does business or where any asset of the account or the institution is
situated. A district court in which such action is brought may issue
process with respect to such action in any other judicial district.
(i) Compensation and Personnel for Alternative Trustees.--
(1) Compensation.--The amount of compensation paid to each
alternative trustee appointed under the provisions of this
section shall require the prior approval of the Commission,
and, in the case of an alternative trustee appointed by a
court, the consent of that court.
(2) Appointment and retention of personnel.--Alternative
trustees appointed under this section shall appoint, retain,
and compensate accountants, actuaries, and other professional
service personnel in accordance with regulations prescribed by
the Commission.
SEC. 405. LIABILITY UPON TERMINATION OF ACCOUNTS.
(a) In General.--In any case in which a personal retirement account
is terminated in a proceeding instituted by the Securities and Exchange
Commission under section 405, each person who is the financial
institution serving as trustee of the account on the termination date
or a member of the financial institution's controlled group shall incur
liability to the Commission under this section. The liability under
this section of all such persons shall be joint and several.
(b) Amount of Liability.--The liability to the Commission of a
person described in subsection (a) shall be the total amount of the
assets of the account which are guaranteed by the Commission and which
are not available for payment from the account, calculated from the
termination date in accordance with regulations prescribed by the
Commission.
(c) Payment of Liability.--
(1) In general.--Except as provided in paragraph (2), the
liability to the Commission under this section shall be due and
payable to the Commission as of the termination date, in cash
or securities acceptable to the Commission.
(2) Special rule.--Payment of so much of the liability as
exceeds 30 percent of the collective net worth of all persons
described in subsection (a) (including interest) shall be made
under commercially reasonable terms prescribed by the
Commission. The parties involved shall make a reasonable effort
to reach agreement on such commercially reasonable terms. Any
such terms prescribed by the Commission shall provide for
deferral of 50 percent of any amount of liability otherwise
payable for any year under this paragraph if a person subject
to such liability demonstrates to the satisfaction of the
Commission 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 Commission and any
person liable under this section may agree to alternative
arrangements for the satisfaction of liability to the
Commission under this subsection.
(d) Definitions.--
(1) Collective net worth of persons subject to liability.--
(A) In general.--The collective net worth of
persons subject to liability in connection with the
termination of a personal retirement account consists
of the sum of the individual net worths of all persons
who--
(i) have individual net worths which are
greater than zero, and
(ii) are (as of the termination date) the
financial institution or members of the
financial institution's controlled group.
(B) Determination of net worth.--For purposes of
this paragraph, the net worth of a person is--
(i) determined on whatever basis best
reflects, in the determination of the
Commission, the current status of the person's
operations and prospects at the time chosen for
determining the net worth of the person, and
(ii) increased by the amount of any
transfers of assets made by the person which
are determined by the Commission to be improper
under the circumstances, including any such
transfers which would be inappropriate under
title 11, United States Code, if the person
were a debtor in a case under chapter 7 of such
title.
(C) Timing of determination.--For purposes of this
paragraph, determinations of net worth shall be made as
of a day chosen by the Commission (during the 120-day
period ending with the termination date) and shall be
computed without regard to any liability under this
section.
(2) Pre-tax profits.--The term ``pre-tax profits'' means,
for any fiscal year of any person, such person's consolidated
net income (excluding any extraordinary charges to income and
including any extraordinary credits to income) for such fiscal
year, as shown on audited financial statements prepared in
accordance with generally accepted accounting principles,
before provision for or deduction of Federal or other income
tax and any amounts required to be paid for such fiscal year
under this section. The Commission may by regulation require
such information to be filed on such forms as may be necessary
to determine the existence and amount of such pre-tax profits.
(3) Controlled group.--
(A) In general.--The term ``controlled group''
means, in connection with any person, a group
consisting of such person and all other persons under
common control with such person.
(B) Common control.--The determination of whether
two or more persons are under ``common control'' shall
be made under regulations of the Commission 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 1986.
(4) Termination date.--The term ``termination date''
means--
(A) the date established by the Commission (or the
alternative trustee appointed under section 405(b)(2),
if any) and agreed to by the financial institution
serving as trustee of the terminated personal
retirement account immediately before the termination,
or
(B) if no agreement is reached, the date
established by the court.
SEC. 406. INSURANCE LOGO.
(a) In General.--Each qualified financial institution, while
serving as trustee for a personal retirement account subject to the
guarantee of the Securities and Exchange Commission under this title,
shall display at each place of business maintained by such institution
a sign containing only the following items:
(1) A statement that insured contributions to personal
retirement accounts maintained by the institution are backed by
the full faith and credit of the United States Government.
(2) A statement that amounts contributed to such accounts
are federally insured to the amount necessary to purchase a
minimum annuity.
(3) A patriotic symbol defined by the Commission by
regulation.
The sign shall not contain any reference to a Government agency and
shall accord each item substantially equal prominence. No person may
display such a sign unless such person is a qualified financial
institution.
(b) Regulations.--The Commission shall prescribe regulations to
carry out the purposes of this section, including regulations governing
the manner of display or use of such signs. Initial regulations under
this section shall be prescribed not later than December 31, 1998.
(c) Penalties.--For each day a qualified financial institution
continues to violate any provision of this section or any lawful
provisions of regulations prescribed under this section, it shall be
subject to a penalty of not more than $100, which the Commission shall
recover for its use.
SEC. 407. REPORT BY THE COMMISSION.
As soon as practicable after the close of each fiscal year the
Securities and Exchange Commission shall transmit to the President and
the Congress a report relative to the conduct of its business under
this title for that fiscal year. The report shall include financial
statements setting forth the result of its operations under this title
(including the source and application of its funds) for the fiscal year
and shall include an actuarial evaluation of the expected operations
and status of the Trust Fund for the next five years (including a
detailed statement of the actuarial assumptions and methods used in
making such evaluation).
TITLE V--ENFORCEMENT AUTHORITY
SEC. 501. CAUSE OF ACTION.
The account holder with respect to a personal retirement account
who is adversely affected by an act or practice of any party (other
than the Securities and Exchange Commission or any officer or employee
thereof) in violation of any provision of this Act, may bring an
action--
(1) to enjoin such act or practice, or
(2) to obtain other appropriate equitable relief (A) to
redress such violation or (B) to enforce such provision.
SEC. 502. JURISDICTION AND VENUE.
The district courts of the United States shall have exclusive
jurisdiction of civil actions under this title. Such actions may be
brought in the district where the personal retirement account is
administered, where the violation took place, or where a defendant
resides or may be found, and process may be served in any other
district where a defendant resides or may be found. The district courts
of the United States shall have jurisdiction, without regard to the
amount in controversy or the citizenship of the parties, to grant the
relief provided for in section 501 in any action.
SEC. 503. RIGHT OF SECURITIES AND EXCHANGE COMMISSION TO INTERVENE.
A copy of the complaint or notice of appeal in any action under
this title shall be served upon the Securities and Exchange Commission
by certified mail. The relevant Federal agency, the Commission, and the
Commission shall have the right in its discretion to intervene in any
action.
SEC. 504. AWARDS OF COSTS AND EXPENSES.
In any action brought under this title, the court in its discretion
may award all or a portion of the costs and expenses incurred in
connection with such action, including reasonable attorney's fees, to
any party who prevails or substantially prevails in such action.
SEC. 505. LIMITATION ON ACTIONS.
(f) In General.--Except as provided in subsection (c), an action
under this title may not be brought after the later of--
(1) 6 years after the date on which the cause of action
arose, or
(2) 3 years after the applicable date specified in
subsection (b).
(b) Applicable Date.--The applicable date specified in this
subsection is the earliest date on which the plaintiff acquired or
should have acquired actual knowledge of the existence of such cause of
action.
(c) Cases of Fraud or Concealment.--In the case of fraud or
concealment, the period described in subsection (a)(2) shall be
extended to 6 years after the applicable date specified in subsection
(b).
SEC. 506. PENALTY FOR FAILURE TO TIMELY PROVIDE REQUIRED INFORMATION.
The Securities and Exchange Commission may assess a penalty,
payable to it, against any person who fails to provide any notice or
other material information required under this Act or any regulations
prescribed under this Act within the applicable time limit specified
therein. Such penalty shall not exceed $1,000 for each day for which
such failure continues.
SEC. 507. ACTIONS BY SECURITIES AND EXCHANGE COMMISSION.
If any person is assessed under this Act and fails to pay the
assessment when due, or any person otherwise fails to meet any
requirement of this Act, the Securities and Exchange Commission may
bring a civil action in any district court of the United States within
the jurisdiction of which such person's assets are located or in which
such person resides or is found for the recovery of the amount of the
assessment or for appropriate equitable relief to redress the violation
or enforce the provisions of this Act, and process may be served in any
other district. The district courts of the United States shall have
jurisdiction over actions brought under this subsection by the
Commission without regard to the amount in controversy.
TITLE VI--TRANSITION FROM COVERAGE FOR OLD-AGE AND SURVIVORS INSURANCE
BENEFITS UNDER TITLE II OF THE SOCIAL SECURITY ACT
SEC. 601. PRIMARY INSURANCE AMOUNTS FOR TRANSITIONAL ELIGIBLE
INDIVIDUALS.
(a) In General.--Section 215(a) of the Social Security Act (42
U.S.C. 415(a)) is amended by adding at the end the following new
paragraph:
``(8) Notwithstanding the preceding provisions of this subsection,
the primary insurance amount of an eligible individual (as defined in
section 2(4) of the Personal Retirement Accounts Act of 1997) shall be
determined, effective for January 2000, as otherwise provided under
this section--
``(A) if such individual has not attained age 62 as of
January 1, 2000, as though such individual had attained such
age on such date, and
``(B) as though such individual had filed application for
old-age insurance benefits in January 2000.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to monthly insurance benefits under part A of title
II of the Social Security Act (as redesignated by this Act) for which
applications are filed after December 31, 1999.
SEC. 602. CERTIFICATION OF COVERED STATUS UNDER THE OLD-AGE, SURVIVORS,
AND DISABILITY INSURANCE PROGRAM.
Not later than July 1, 2000, the Commissioner of Social Security
shall provide a written certification to each individual who has a
social security account number, who has been credited with wages or net
earnings from self-employment. Such certification shall indicate to
each recipient whether such recipient is or is not an eligible
individual and a description of the benefits available to such
individual under part A of title II of the Social Security Act based on
such individual's status as an eligible individual or otherwise.
SEC. 603. REDUCTION IN FICA AND SECA TAXES WITH RESPECT TO ELIGIBLE
INDIVIDUALS.
(a) Tax on Employees.--Section 3101 of the Internal Revenue Code of
1986 (relating to OASDI tax on employees) is amended--
(1) in subsection (a), by striking ``In addition'' and
inserting ``Subject to subsection (c), in addition'';
(2) by redesignating subsection (c) as subsection (d); and
(3) by inserting after subsection (b) the following new
subsection:
``(c) Reduction in OASDI Tax.--In the case of an eligible
individual (as defined in section 104(3) of the Personal Retirement
Accounts Act of 1997), the rate of tax under subsection (a) shall be
2.90 percent.''
(b) Tax on Employers.--Section 3111 of such Code (relating to OASDI
tax on employers) is amended--
(1) in subsection (a), by striking ``In addition'' and
inserting ``Subject to subsection (c), in addition'';
(2) by redesignating subsection (c) as subsection (d); and
(3) by inserting after subsection (b) the following new
subsection:
``(d) Reduction in OASDI Tax.--The rate of tax under subsection (a)
with respect to having in the employer's employ an eligible individual
(as defined in section 104(3) of the Personal Retirement Accounts Act
of 1997) shall be 2.90 percent.''
(c) Self-Employment Tax.--Subsection (a) of section 1401 of such
Code (relating to OASDI tax on self-employment income) is amended--
(1) in subsection (a), by striking ``In addition'' and
inserting ``Subject to subsection (c), in addition'';
(2) by redesignating subsection (c) as subsection (d); and
(3) by inserting after subsection (b) the following new
subsection:
``(c) Reduction in OASDI Tax.--In the case of an eligible
individual (as defined in section 104(3) of the Personal Retirement
Accounts Act of 1997), the rate of tax under subsection (a) with
respect to self-employment income for taxable years ending after
December 31, 1999, shall be 5.80 percent.''
(d) Effective Date.--The amendments made by this section shall
apply with respect to wages received after December 31, 1999, and with
respect to self-employment income for taxable years ending after such
date.
SEC. 604. SUPPLEMENTAL RETIREMENT BENEFITS.
(a) In General.--Section 202 of the Social Security Act (42 U.S.C.
402) is amended by adding at the end the following new subsection:
``Supplemental Retirement Benefits
``(y)(1) Every individual--
``(A) who is a fully insured individual
``(B) who has attained retirement age (as defined in
section 216(l)),
``(C) who is an eligible individual (as defined in section
104(3) of the Personal Retirement Accounts Act of 1997),
``(D) to whom no distribution has been made from any
personal retirement account established under title I of the
Personal Retirement Accounts Act of 1997, and
``(E) whose personal retirement account holds, as of the
date on which the individual attains retirement age, total
assets equal, in the aggregate, to less than the minimum
annuity amount (as defined in section 2(b) of the Personal
Retirement Accounts Act of 1997),
shall be entitled to a supplemental old-age benefit for each month,
beginning with the month in which such individual attains retirement
age and ending with the month preceding the month in which he dies.
``(2) Such individual's supplemental retirement benefit for any
month shall be equal to the excess of--
``(A) the minimum annuity amount (as defined in section
2(6)(A) of the Personal Retirement Accounts Act of 1997) for
the month, over
``(B) the amount which would be payable as a monthly
periodic payment of an immediate annuity (as defined in section
202(b)(5) of the Personal Retirement Accounts Act of 1997)
purchased with the total balance, in the aggregate, of all
personal retirement accounts maintained for such individual
under title I of such Act, determined as of the date on which
such individual attains retirement age.
``(3) There are authorized to be appropriated sums sufficient to
carry out this section.''.
(b) Conforming Amendment.--Section 201(h) of such Act (42 U.S.C.
401(h)) is amended by striking ``section 226'' and inserting ``sections
202(y) and 226''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to months beginning on or after January 1, 2000.
SEC. 605. PHASED IN INCREASE IN SOCIAL SECURITY RETIREMENT AGE.
Section 216(l) of the Social Security Act (42 U.S.C. 416(l) is
amended--
(1) by striking subparagraphs (B), (C), (D), and (E) of
paragraph (1) and inserting the following new subparagraphs:
``(B) with respect to an individual who attains early
retirement age (as determined under paragraph (2)) after
December 31, 1999, and before January 1, 2029, 65 years of age
plus \2/12\ of the number of months in the period beginning
with January 2000 and ending with December of the year in which
the individual attains early retirement age (as so determined);
and
``(C) with respect to an individual who attains early
retirement age (as so determined) after December 31, 2028, 70
years of age.''; and
(2) by striking paragraph (3).
SEC. 606. LIMITATION IN COST-OF-LIVING ADJUSTMENTS.
(a) Reduction in Increases Applied to Higher Primary Insurance
Amounts.--
(1) In general.--Section 215(i)(2)(A) of the Social
Security Act (42 U.S.C. 415(i)(2)(A)) is amended--
(A) by redesignating clause (iii) as clause (vii);
and
(B) in clause (ii), by striking ``The increase
shall'' in the matter following subclause (III) and all
that follows through ``Any increase'' and inserting the
following:
``(iii) With respect to the amounts described in subclauses (I) and
(III) of clause (ii) and primary insurance amounts described in
subclause (II) of clause (ii) of individuals initially becoming
entitled to monthly insurance benefits based on their own wages and
self-employment income as disability insurance benefits, the increase
shall be derived by multiplying each of such amounts (including each of
those amounts as previously increased under this subparagraph) by the
applicable increase percentage.
``(iv) With respect to primary insurance amounts described in
subclause (II) of clause (ii) (other than primary insurance amounts
described in clause (iii) of this subparagraph), the increase shall be
derived by--
``(I) multiplying each of such amounts (including each such
amount as previously increased under this subparagraph) by the
applicable increase percentage,
``(II) determining among all such amounts as increased
under subclause (I) the primary insurance amount which is at
the 30th percentile of such amounts, and
``(III) reducing each primary insurance amount as increased
under subclause (I) to the sum of such amount determined as if
there had been no reduction in such amount under this subclause
in any preceding year and the amount of the increase under
subclause (I) in the primary insurance amount described in
subclause (II).
``(v) Any amount increased under clause (iii) or clause (iv) which
is not a multiple of $0.10 shall be decreased to the next lower
multiple of $0.10.
``(vi) Any increase''.
(2) Conforming amendment.--The last sentence of section
215(a)(4) of such Act (42 U.S.C. 415(a)(4)) is amended, in
subclause (I), by striking ``clause (iii) of subsection
(i)(2)(A)'' and inserting ``clause (vii) of subsection
(i)(2)(A)''.
(3) Conforming amendments to maintain current levels of
cost-of-living adjustment under other programs.--
(A) Supplemental security income for the aged,
blind, and disabled.--Section 1617(a)(2) of the Social
Security Act (42 U.S.C. 1382f(a)(2)) is amended by
striking ``by the same percentage'' and all that
follows through ``percentage,'' and inserting the
following: ``by the applicable increase percentage
(within the meaning of section 215(i)(1)(C)) used in
determining the amount by which benefit amounts under
title II are increased for such month''.
(B) Supplementary medical insurance.--Section
1839(a)(3)(B) of such Act (42 U.S.C. 1395r(a)(3)(B)) is
amended by striking ``by a percentage'' and all that follows through
``November 1'' and inserting the following: ``by the applicable
increase percentage (within the meaning of section 215(i)(1)(C)) used
in determining the amount by which benefit amounts under title II are
increased for the month of December preceding the year of the
promulgation''.
(C) Certain veteran's benefits.--Section 3112 of
title 38, United States Code, is amended--
(i) in subsection (a), by striking ``by the
same percentage by which such benefit amounts
are increased'' and inserting ``by the
applicable increase percentage (within the
meaning of section 215(i)(1)(C) of such Act)
used in determining the amount by which such
benefit amounts are increased''; and
(ii) in subsection (b)(1), by striking ``by
the same percentage as the percentage by which
such benefit amounts are increased'' and
inserting ``by the applicable increase
percentage (within the meaning of section
215(i)(1)(C) of such Act) used in determining
the amount by which such benefit amounts are
increased''.
(D) Cost-of-living adjustments to limitations on
benefits and contributions under qualified plans.--
Subsection (d) of section 415 of the Internal Revenue
Code of 1986 (relating to cost-of-living adjustments)
is amended by striking ``section 215(i)(2)(A)'' and
inserting ``section 215(i)(2)(A)(iii)''.
(4) Amendment to prior applicable law.--Section 215(i)(4)
of the Social Security Act (42 U.S.C. 415(i)(4)) is amended by
adding at the end the following new sentence: ``The Secretary
shall provide by regulation for the continued application of
this subsection as in effect in December 1978 as provided by
the preceding provisions of this paragraph and the amendments
referred to therein. Such regulations shall provide for the
application of the amendments to the preceding provisions of
this subsection made by section 606 of the Personal Retirement
Accounts Act of 1997 so as to have the same effect on the
corresponding provisions of this subsection as in effect in
December 1978 and applicable in accordance with this
paragraph.''.
(b) Effective Date.--The amendments made by this section shall
apply with respect to adjustments effective with months after November
1999.
SEC. 607. MODIFICATION OF CPI CALCULATION FOR SOCIAL SECURITY COLAS.
For purposes of section 215(i) of the Social Security Act,
effective for cost-of-living computation quarters occurring after 1997
and before the year following the year in which there takes effect a
revision by the Bureau of Labor Statistics in the method of computing
the Consumer Price Index referred to in section 215(i)(1)(D) of such
Act, the Consumer Price Index referred to in such section 215(i)(1)(D)
shall be reduced by 0.5 percentage points.
SEC. 608. PHASED REDUCTION IN SPOUSAL BENEFITS OTHER THAN SURVIVOR'S
BENEFITS TO 33 PERCENT OF PRIMARY INSURANCE AMOUNT.
(a) Wife's Insurance Benefits.--Section 202(b)(2) of the Social
Security Act (42 U.S.C. 402(b)(2)) is amended to read as follows:
``(2)(A) Except as provided in subsection (q) and paragraph (4) of
this subsection, such wife's insurance benefit for each month shall be
equal to the applicable percentage of the primary insurance amount of
her husband (or, in the case of a divorced wife, her former husband) in
connection with the calendar year in which such individual becomes
eligible for such benefit, as specified in the following table:
``If the calendar year in which the The applicable percentage shall be:
individual becomes eligible
is:
Before calendar year 2000.................... 50 percent
Calendar year 2000........................... 49 percent
Calendar year 2001........................... 48 percent
Calendar year 2002........................... 47 percent
Calendar year 2003........................... 46 percent
Calendar year 2004........................... 45 percent
Calendar year 2005........................... 44 percent
Calendar year 2006........................... 43 percent
Calendar year 2007........................... 42 percent
Calendar year 2008........................... 41 percent
Calendar year 2009........................... 40 percent
Calendar year 2010........................... 39 percent
Calendar year 2011........................... 38 percent
Calendar year 2012........................... 37 percent
Calendar year 2013........................... 36 percent
Calendar year 2014........................... 35 percent
Calendar year 2015........................... 34 percent
After calendar year 2015..................... 33 percent.''.
``(B) For purposes of subparagraph (A)--
``(i) an individual shall be treated as eligible for a
wife's insurance benefit if such individual meets the
requirements of subparagraphs (B), (C), and (D) of paragraph
(1), and
``(ii) in determining when an individual becomes eligible
for a wife's insurance benefit, any break in eligibility of
less than 12 consecutive months shall not be taken into
account.''.
(b) Husband's Insurance Benefits.--Section 202(c)(3) of such Act
(42 U.S.C. 402(c)(3)) is amended to read as follows:
``(3)(A) Except as provided in subsection (q) and paragraph (2) of
this subsection, such husband's insurance benefit for each month shall
be equal to the applicable percentage of the primary insurance amount
of his wife (or, in the case of a divorced husband, his former wife) in
connection with the calendar year in which such individual becomes
eligible for such benefit, as specified in the following table:
``If the calendar year in which the The applicable percentage shall be:
individual becomes eligible
is:
Before calendar year 2000.................... 50 percent
Calendar year 2000........................... 49 percent
Calendar year 2001........................... 48 percent
Calendar year 2002........................... 47 percent
Calendar year 2003........................... 46 percent
Calendar year 2004........................... 45 percent
Calendar year 2005........................... 44 percent
Calendar year 2006........................... 43 percent
Calendar year 2007........................... 42 percent
Calendar year 2008........................... 41 percent
Calendar year 2009........................... 40 percent
Calendar year 2010........................... 39 percent
Calendar year 2011........................... 38 percent
Calendar year 2012........................... 37 percent
Calendar year 2013........................... 36 percent
Calendar year 2014........................... 35 percent
Calendar year 2015........................... 34 percent
After calendar year 2015..................... 33 percent.''.
``(B) For purposes of subparagraph (A)--
``(i) an individual shall be treated as eligible for a
husband's insurance benefit if such individual meets the
requirements of subparagraphs (B), (C), and (D) of paragraph
(1), and
``(ii) in determining when an individual becomes eligible
for a husband's insurance benefit, any break in eligibility of
less than 12 consecutive months shall not be taken into
account.''.
SEC. 609. COVERAGE OF NEWLY HIRED STATE AND LOCAL EMPLOYEES.
(a) Amendments to the Social Security Act.--
(1) In general.--Paragraph (7) of section 210(a) of the
Social Security Act (42 U.S.C. 410(a)(7)) is amended to read as
follows:
``(7) Excluded State or local government employment (as
defined in subsection (s));''.
(2) Excluded state or local government employment.--
(A) In general.--Section 210 of such Act (42 U.S.C.
410) is amended by adding at the end the following new
subsection:
``Excluded State or Local Government Employment
``(s)(1) In General.--The term `excluded State or local government
employment' means any service performed in the employ of a State, of
any political subdivision thereof, or of any instrumentality of any one
or more of the foregoing which is wholly owned thereby, if--
``(A)(i) such service would be excluded from the term
`employment' for purposes of this title if the preceding
provisions of this section as in effect in October 1997 had
remained in effect, and (ii) the requirements of paragraph (2)
are met with respect to such service, or
``(B) the requirements of paragraph (3) are met with
respect to such service.
``(2) Exception for Current Employment Which Continues.--
``(A) In general.--Except as provided in subparagraph (B),
the requirements of this paragraph are met with respect to
service for any employer if--
``(i) such service is performed by an individual--
``(I) who was performing substantial and
regular service for remuneration for that
employer before January 1, 2000,
``(II) who is a bona fide employee of that
employer on December 31, 1999, and
``(III) whose employment relationship with
that employer was not entered into for purposes
of meeting the requirements of this
subparagraph, and
``(ii) the employment relationship with that
employer has not been terminated after December 31,
1999.
``(B) Elections for inclusion.--The requirements of this
paragraph shall be deemed not met with respect to service
performed by an individual if such individual elects in writing
before January 1, 2000, in such form and manner as shall be
prescribed in regulations of the Commissioner of Social
Security, that the requirements of this paragraph be deemed not
to be met with respect to such service.
``(C) Treatment of multiple agencies and
instrumentalities.--For purposes of subparagraph (A), under
regulations (consistent with regulations established under
section 3121(t)(2)(B) of the Internal Revenue Code of 1986)--
``(i) all agencies and instrumentalities of a State
(as defined in section 218(b)) or of the District of
Columbia shall be treated as a single employer, and
``(ii) all agencies and instrumentalities of a
political subdivision of a State (as so defined) shall
be treated as a single employer and shall not be
treated as described in clause (i).
``(3) Exception for Certain Services.--
``(A) In general.--The requirements of this paragraph are
met with respect to service if such service is performed--
``(i) by an individual who is employed by a State
or political subdivision thereof to relieve such
individual from unemployment,
``(ii) in a hospital, home, or other institution by
a patient or inmate thereof as an employee of a State
or political subdivision thereof or of the District of
Columbia,
``(iii) by an individual, as an employee of a State
or political subdivision thereof or of the District of
Columbia, serving on a temporary basis in case of fire,
storm, snow, earthquake, flood, or other similar
emergency,
``(iv) by any individual as an employee included
under section 5351(2) of title 5, United States Code
(relating to certain interns, student nurses, and other
student employees of hospitals of the District of
Columbia Government), other than as a medical or dental
intern or a medical or dental resident in training,
``(v) by an election official or election worker if
the remuneration paid in a calendar year for such
service is less than $1,000 with respect to service
performed during calendar year 2000, and the adjusted
amount determined under subparagraph (C) for any
subsequent year with respect to service performed
during such subsequent year, except to the extent that
service by such election official or election worker is
included in employment under an agreement under section
218, or
``(vi) by an employee in a position compensated
solely on a fee basis which is treated pursuant to
section 211(c)(2)(E) as a trade or business for
purposes of inclusion of such fees in net earnings from
self-employment.
``(B) Definitions.--As used in this paragraph, the terms
`State' and `political subdivision' have the meanings given
those terms in section 218(b).
``(C) Adjustments to dollar amount for election officials
and election workers.--For each year after 2000, the
Commissioner of Social Security shall adjust the amount
referred to in subparagraph (A)(v) at the same time and in the
same manner as is provided under section 215(a)(1)(B)(ii) with
respect to the amounts referred to in section 215(a)(1)(B)(i),
except that--
``(i) for purposes of this subparagraph, 1997 shall
be substituted for the calendar year referred to in
section 215(a)(1)(B)(ii)(II), and
``(ii) such amount as so adjusted, if not a
multiple of $100, shall be rounded to the next higher
multiple of $100 where such amount is a multiple of $50
and to the nearest multiple of $100 in any other case.
The Commissioner of Social Security shall determine and publish
in the Federal Register each adjusted amount determined under
this subparagraph not later than November 1 preceding the year
for which the adjustment is made.''.
(B) Conforming amendments.--
(i) Subsection (k) of section 210 of such
Act (42 U.S.C. 410(k)) (relating to covered
transportation service) is repealed.
(ii) Section 210(p) of such Act (42 U.S.C.
410(p)) is amended--
(I) in paragraph (2), by striking
``service is performed'' and all that
follows and inserting ``service is
service described in subsection
(s)(3)(A).''; and
(II) in paragraph (3)(A), by
inserting ``under subsection (a)(7) as
in effect in December 1999'' after
``section''.
(iii) Section 218(c)(6) of such Act (42
U.S.C. 418(c)(6)) is amended--
(I) by striking subparagraph (C);
(II) by redesignating subparagraphs
(D) and (E) as subparagraphs (C) and
(D), respectively; and
(III) by striking subparagraph (F)
and inserting the following:
``(E) service which is included as employment under section
210(a).''
(b) Amendments to the Internal Revenue Code of 1986.--
(1) In general.--Paragraph (7) of section 3121(b) of the
Internal Revenue Code of 1986 (relating to employment) is
amended to read as follows:
``(7) excluded State or local government employment (as
defined in subsection (t));''.
(2) Excluded state or local government employment.--Section
3121 of such Code is amended by inserting after subsection (s)
the following new subsection:
``(t) Excluded State or Local Government Employment.--
``(1) In general.--For purposes of this chapter, the term
`excluded State or local government employment' means any
service performed in the employ of a State, of any political
subdivision thereof, or of any instrumentality of any one or more of
the foregoing which is wholly owned thereby, if--
``(A)(i) such service would be excluded from the
term `employment' for purposes of this chapter if the
provisions of subsection (b)(7) as in effect in
December 1999 had remained in effect, and
``(ii) the requirements of paragraph (2) are met
with respect to such service, or
``(B) the requirements of paragraph (3) are met
with respect to such service.
``(2) Exception for current employment which continues.--
``(A) In general.--The requirements of this
paragraph are met with respect to service for any
employer if--
``(i) such service is performed by an
individual--
``(I) who was performing
substantial and regular service for
remuneration for that employer before
January 1, 2000,
``(II) who is a bona fide employee
of that employer on December 31, 2000,
and
``(III) whose employment
relationship with that employer was not
entered into for purposes of meeting
the requirements of this subparagraph,
and
``(ii) the employment relationship with
that employer has not been terminated after
December 31, 1999.
``(B) Treatment of multiple agencies and
instrumentalities.--For purposes of subparagraph (A),
under regulations--
``(i) all agencies and instrumentalities of
a State (as defined in section 218(b) of the
Social Security Act) or of the District of
Columbia shall be treated as a single employer,
and
``(ii) all agencies and instrumentalities
of a political subdivision of a State (as so
defined) shall be treated as a single employer
and shall not be treated as described in clause
(i).
``(3) Exception for certain services.--
``(A) In general.--The requirements of this
paragraph are met with respect to service if such
service is performed--
``(i) by an individual who is employed by a
State or political subdivision thereof to
relieve such individual from unemployment,
``(ii) in a hospital, home, or other
institution by a patient or inmate thereof as
an employee of a State or political subdivision
thereof or of the District of Columbia,
``(iii) by an individual, as an employee of
a State or political subdivision thereof or of
the District of Columbia, serving on a
temporary basis in case of fire, storm, snow,
earthquake, flood, or other similar emergency,
``(iv) by any individual as an employee
included under section 5351(2) of title 5,
United States Code (relating to certain
interns, student nurses, and other student
employees of hospitals of the District
of Columbia Government), other than as a medical or dental intern or a
medical or dental resident in training,
``(v) by an election official or election
worker if the remuneration paid in a calendar
year for such service is less than $1,000 with
respect to service performed during 2000, and
the adjusted amount determined under section
210(s)(3)(C) of the Social Security Act for any
subsequent year with respect to service
performed during such subsequent year, except
to the extent that service by such election
official or election worker is included in
employment under an agreement under section 218
of the Social Security Act, or
``(vi) by an employee in a position
compensated solely on a fee basis which is
treated pursuant to section 1402(c)(2)(E) as a
trade or business for purposes of inclusion of
such fees in net earnings from self-employment.
``(B) Definitions.--As used in this paragraph, the
terms `State' and `political subdivision' have the
meanings given those terms in section 218(b) of the
Social Security Act.''.
(3) Conforming amendments.--
(A) Subsection (j) of such section 3121 (relating
to covered transportation service) is repealed.
(B) Paragraph (2) of section 3121(u) of such Code
(relating to application of hospital insurance tax to
Federal, State, and local employment) is amended--
(i) in subparagraph (B), by striking
``service is performed'' in clause (ii) and all
that follows through the end of such
subparagraph and inserting ``service is service
described in subsection (t)(3)(A).''; and
(ii) in subparagraph (C)(i), by inserting
``under subsection (b)(7) as in effect in July
1996'' after ``chapter''.
(c) Effective Date.--Except as otherwise provided in this section,
the amendments made by this section shall apply with respect to service
performed after December 31, 1997.
SEC. 610. ADJUSTMENTS IN FORMULA FOR DETERMINING PRIMARY INSURANCE
AMOUNT.
(a) Additional Earnings Bracket.--Section 215(a)(1)(A) of the
Social Security Act (42 U.S.C. 415(a)(1)(A)) is amended--
(1) in clause (ii), by striking ``and'';
(2) in clause (iii), by striking ``clause (ii),'' and
inserting the following: ``clause (ii), but, in the case of an
individual who initially becomes eligible for old-age insurance
benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who dies (before becoming
eligible for such benefits), after calendar year 2001, do not
exceed the amount established for purposes of this clause by
subparagraph (B), and''; and
(3) by inserting after clause (iii) the following new
clause:
``(iv) in the case of an individual who initially becomes
eligible for old-age insurance benefits (other than solely by
reason of prior entitlement to disability insurance benefits),
or who dies (before becoming eligible for such benefits), after
calendar year 2001, 10 percent of the individual's average
indexed monthly earnings to the extent that such earnings
exceed the amount established for purposes of clause (iii),''.
(b) Bend Point Amounts.--Section 215(a)(1)(B) of the Social
Security Act (42 U.S.C. 415(a)(1)(B)) is amended--
(1) in clause (ii), by inserting ``and before 2002'' after
``1979'' the first place it appears, and by striking ``by
dividing--'' and all that follows and inserting ``under clause
(ix) of this subparagraph.'';
(2) by redesignating clause (iii) as clause (xii);
(3) by inserting after clause (ii) the following new
clauses:
``(iii) For individuals who initially become eligible for old-age
insurance benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who die (before becoming eligible
for such benefits), in any calendar year after 2001, the amount
established for purposes of clause (i) of subparagraph (A) shall be an
amount equal to the product of the following factors:
``(I) the amount established with respect to calendar year
1979 under clause (i) of this subparagraph for purposes of
clause (i) of subparagraph (A), and
``(II) the quotient obtained under clause (ix) of this
subparagraph.
``(iv) For individuals who initially become eligible for old-age
insurance benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who die (before becoming eligible
for such benefits), in any calendar year after 2001 and before 2026,
the amount established for purposes of clause (ii) of subparagraph (A)
shall be an amount equal to the product of the following factors:
``(I) the amount established with respect to the preceding
calendar year under this subparagraph for purposes of clause
(ii) of subparagraph (A),
``(II) the quotient obtained under clause (x) of this
subparagraph, and
``(III) 0.99.
``(v) For individuals who initially become eligible for old-age
insurance benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who die (before becoming eligible
for such benefits), in any calendar year after 2025, the amount
established for purposes of clause (ii) of subparagraph (A) shall be an
amount equal to the product of the following factors:
``(I) the amount established with respect to the calendar
year 2025 under clause (iv) of this subparagraph for purposes
of clause (ii) of subparagraph (A), and
``(II) the quotient obtained under clause (xi) of this
subparagraph.
``(vi) For individuals who initially become eligible for old-age
insurance benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who die (before becoming eligible
for such benefits), in the calendar year 2002, the amount established
for purposes of clause (iii) of subparagraph (A) shall be an amount
equal to the quotient derived by dividing--
``(I) the amount established with respect to the calendar
year 2002 under clause (iv) of this subparagraph for purposes
of clause (ii) of subparagraph (A), by
``(II) 0.99<SUP>50</SUP>.
``(vii) For individuals who initially become eligible for old-age
insurance benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who die (before becoming eligible
for such benefits), in any calendar year after 2002 and before 2026,
the amount established for purposes of clause (iii) of subparagraph (A)
shall be an amount equal to the product of the following factors:
``(I) the amount established with respect to the preceding
calendar year under this subparagraph for purposes of clause
(iii) of subparagraph (A),
``(II) the quotient obtained under clause (x) of this
subparagraph, and
``(III) 0.99.
``(viii) For individuals who initially become eligible for old-age
insurance benefits (other than solely by reason of prior entitlement to
disability insurance benefits), or who die (before becoming eligible
for such benefits), in any calendar year after 2025, the amount
established for purposes of clause (iii) of subparagraph (A) shall be
an amount equal to the product of the following factors:
``(I) the amount established with respect to calendar year
2025 under clause (vii) of this subparagraph for purposes of
clause (iii) of subparagraph (A), and
``(II) the quotient obtained under clause (xi) of this
subparagraph.
``(ix) The quotient obtained under this clause is the quotient
obtained by dividing--
``(I) the deemed average total wages (as defined in section
209(k)(1)) for the second calendar year preceding the calendar
year for which the determination is made, by
``(II) the average of the total wages (as defined in
regulations of the Secretary and computed without regard to the
limitations specified in section 209(a)(1)) reported to the
Secretary of the Treasury or his delegate for the calendar year
1977.
``(x) The quotient obtained under this clause is the quotient
obtained by dividing--
``(I) the deemed average total wages (as defined in section
209(k)(1)) for the second calendar year preceding the calendar
year for which the determination is made, by
``(II) the deemed average total wages (as defined in
section 209(k)(1)) for the third calendar year preceding the
calendar year for which the determination is made.
``(xi) The quotient obtained under this clause is the quotient
obtained by dividing--
``(I) the deemed average total wages (as defined in section
209(k)(1)) for the second calendar year preceding the calendar
year for which the determination is made, by
``(II) the average of the total wages (as defined in
regulations of the Secretary and computed without regard to the
limitations specified in section 209(a)(1)) reported to the
Secretary of the Treasury or his delegate for the calendar year
2024.''; and
(4) in clause (xii) (as redesignated), by striking ``clause
(ii)'' and inserting ``the preceding clauses of this
subparagraph''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to individuals who initially become eligible (within
the meaning of section 215(a)(3)(B) of the Social Security Act) for
old-age insurance benefits under title II of the Social Security Act,
or who die (before becoming eligible for such benefits), in any
calendar year after 2001.
SEC. 611. ANNUAL STATEMENT OF ACCRUED LIABILITY OF THE OLD-AGE AND
SURVIVORS INSURANCE PROGRAM.
(a) In General.--Section 1105(a) of title 31, United States Code
(relating to budget contents and submission to Congress) is amended by
adding at the end the following new paragraph:
``(31) a statement of the current accrued liability of the
Federal Government for future benefit payments under the Old-
Age and Survivors Insurance Program under title II of the
Social Security Act.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply with respect to budgets submitted for fiscal years beginning on
or after October 1, 1998.
TITLE VII--PROVISIONS RELATING TO FEDERAL CIVILIAN AND MILITARY
PERSONNEL
SEC. 701. FEDERAL CIVILIAN AND MILITARY PERSONNEL.
(a) In General.--Not later than December 31, 1998, the Office of
Personnel Management, after appropriate study, shall submit to the
President and each House of Congress a written report containing
recommendations on how to provide for the application of this Act with
respect to Federal civilian and military personnel.
(b) Requirements.--The report--
(1) shall be prepared in consultation with the Social
Security Administration, the Securities and Exchange
Commission, and other appropriate agencies; and
(2) shall be accompanied by draft legislation which, if
enacted, would carry out the recommendations contained in such
report.
SEC. 702. PROVISIONS RELATING TO THE CONTINUED OPERATION OF EXISTING
RETIREMENT SYSTEMS.
To the extent that the report and draft legislation relate to
provisions of law in effect before the date of enactment of this Act,
each shall address at least the following:
(1) Federal employees' retirement system.--
(A) Section 8401(11) of title 5, United States Code
(relating to the definition of an ``employee''), which
includes the requirement that the individual concerned
be someone whose civilian service is employment for the
purposes of title II of the Social Security Act and
chapter 21 of the Internal Revenue Code of 1986.
(B) Section 8421 of such title (relating to annuity
supplement), which includes provisions incorporating
the notion of the period of time for which the
individual is or would be entitled to old-age insurance
benefits under title II of the Social Security Act, and
provisions for computing the amount of such supplement
based on the amount of certain benefits to which the
individual would be entitled under such Act.
(C) Section 8442 of such title (relating to rights
of a widow or widower), which includes provisions under
which a supplementary annuity for a widow or widower is
not payable to anyone who would not be entitled to
certain benefits under the Social Security Act, and
provisions for the computation of any such annuity
based on the amount of certain benefits which would be
payable to that individual under the Social Security
Act.
(D) Section 8443 of such title (relating to rights
of a child), which includes provisions under which, as
part of the formula for computing the amount of a
survivor annuity for a child, there is incorporated the
notion of the amount of child's insurance benefits
which are or would be payable under title II of the
Social Security Act.
(2) Civil service retirement system.--
(A) Section 8334(k) of such title (relating to
special rules for determining deductions and
contributions for individuals subject to ``offset-83''
treatment), which incorporates the notion of the OASDI
contribution made from Federal wages of the individual
concerned.
(B) Section 8349 of such title (relating to offset
based on certain benefits under the Social Security
Act), which incorporates notions relating to actual or
constructive eligibility for benefits under the Social
Security Act, and the amount of those benefits.
(3) Coordination provisions.--Provisions of law involving a
reduction or other adjustment in retirement benefits (or
eligibility therefor), based on any individual's eligibility
for benefits under title II of the Social Security Act.
(4) Other retirement systems.--Similar provisions of law
under other retirement systems covering Federal civilian or
military personnel.
SEC. 703. PROVISIONS RELATING TO THE NEW SYSTEM.
To the extent that the report and draft legislation relate to the
implementation of any other title of this Act, each shall address at
least the following:
(1) What the specifications for the personal retirement
account payroll deduction program or programs covering Federal
civilian and military personnel shall be or, alternatively, how
those specifications shall be developed.
(2) Which agencies or instrumentalities of the Federal
Government shall be responsible for operating or maintaining
which aspects of the program or programs referred to in
paragraph (1).
(3) Which penalty provisions are appropriate or
inappropriate with respect to the Federal Government in its
capacity as a ``covered employer'', subject to what
modifications (if any).
(4) With respect to the enforcement provisions under title
V, issues similar to those referred to in paragraph (3).
TITLE VIII--SOCIAL SECURITY TRANSITION COMMISSION
SEC 801. ESTABLISHMENT OF COMMISSION.
There is established a commission to be known as the Social
Security Transition Commission (in this title referred to as the
``Commission'').
SEC. 802. DUTIES.
(a) Findings.--The Commission shall make findings regarding the
most appropriate actions which should be taken, together with the
implementation of the provisions of this Act, so that any increases in
budget outlays resulting from the implementation of such provisions are
minimized and are adequately funded. Such findings shall include
specific findings with respect to each of the following possible
actions:
(1) The sale of Federal assets.
(2) Budget outlay reductions.
(3) Increases in revenue.
(4) Issuance of additional obligations.
(b) Recommendations.--
(1) In general.--The Commission shall make specific
recommendations to the Congress regarding its findings under
subsection (a) not later than January 1, 2001, and shall
include with such recommendations legislative language
necessary for carrying out such recommendations. The Commission
shall develop such legislative language after conducting such
public hearings regarding the issues addressed as the
Commission considers appropriate. The Commission shall actively
consult with the appropriate Committees of each House of the
Congress, the Comptroller General of the United States, and the
Director of the Office of Management and Budget in compiling
such legislative language. The Commission shall promptly
provide, upon request, to any Member of Congress a description
of any information used by the Commission in making its
recommendations.
(2) Budget outlay reductions permanent.--All reductions in
obligational authority contained in the legislative language
included in the Commission's recommendations shall be done in a
manner that makes such reductions permanent.
(3) Accompanying report by cbo.--The Comptroller General of
the United States shall provide appropriate assistance to the
Commission in the preparation of the Commission's report and
shall transmit to each House of the Congress at the time of the
Commission's transmittal a report containing a detailed
analysis of the Commission's recommendations.
SEC. 803. MEMBERSHIP.
(a) Appointment.--
(1) In general.--The Commission shall be composed of 7
members appointed by the President, by and with the advice and
consent of the Senate.
(2) Transmittal of nominations.--The President shall
transmit to the Senate the nominations for appointment to the
Commission by no later than June 30, 1999.
(3) Recommendations.--In selecting individuals for
nominations for appointments to the Commission, the President
shall take into consideration--
(A) with respect to the nomination of 3 of the
members of the Commission, recommendations which shall
be jointly submitted by the Speaker of the House of
Representatives and the minority leader of the House of
Representatives, and
(B) with respect to the nomination of 3 other
members of the Commission, recommendations which shall
be jointly submitted by the majority leader of the
Senate and the minority leader of the Senate.
Not more than 4 members of the Commission may be of the same
political party.
(b) Chairman.--At the time the President nominates individuals for
appointment to the Commission, the President shall designate one such
individual who shall serve as Chairman of the Commission.
(c) Disqualification.--No individual may serve as a member of the
Commission while such individual serves as a Member of Congress or as
an officer or employee of the Executive branch. No individual may serve
as a member of the Commission if such individual is or has been a
registered lobbyist.
(d) Vacancies.--Any vacancy in the membership of the Commission
shall be filled in the manner in which the original appointment was
made and shall not affect the power of the remaining members to execute
the duties of the Commission.
(e) Quorum.--A quorum shall consist of 4 members of the Commission,
except that 3 members may conduct a hearing under section 804(a).
(f) Meetings.--The Commission shall meet at the call of the
Chairman or a majority of its members. Each meeting of the Commission,
other than meetings in which classified information is to be discussed,
shall be open to the public. All the proceedings, information, and
deliberations of the Commission shall be open, upon request, to the
Chairmen and the ranking minority members of the Committee on
Government Reform and Oversight, the Committee on the Budget, and the
Committee on Appropriations of the House of Representatives and the
Committee on Governmental Affairs, the Committee on the Budget, and the
Committee on Appropriations of the Senate.
(g) Compensation and Reimbursement of Expenses.--
(1) Compensation.--The members of the Commission shall be
paid for each day (including travel time) during which they are
engaged in the actual performance of duties vested in the
Commission. The members shall be paid--
(A) in the case of the Chairman, at a rate not to
exceed the daily equivalent of the minimum annual rate
of basic pay payable for level III of the Executive
Schedule under section 5314 of title 5, United States
Code, and
(B) in the case of the other members, at a rate not
to exceed the daily equivalent of the minimum annual
rate of basic pay payable for level IV of the Executive
Schedule under section 5315 of such title.
(2) Reimbursement of expenses.--Members of the Commission
shall receive travel expenses, including per diem in lieu of
subsistence, in accordance with sections 5702 and 5703 of title
5, United States Code.
(h) Staff Director and Staff.--
(1) Staff Director.--The Commission shall appoint a Staff
Director who is not otherwise, and has not during the 1-year
period preceding the date of such appointment served as, an
officer or employee in the Executive branch and who is not and
has not been Member of Congress or a registered lobbyist. The
Staff Director shall be paid at a rate not to exceed the rate
of basic pay payable for level IV of the Executive Schedule
under section 5315 of title 5, United States Code.
(2) Staff.--
(A) In general.--The Staff Director, with the
approval of the Commission, may appoint and fix pay of
additional personnel. The Staff Director may take such
appointments without regard to the provisions of title
5, United States Code, governing appointment in the
competitive service, and any personnel so appointed may
be paid without regard to the provisions of chapter 51
and subchapter III of chapter 53 of such title relating
to classification and General Schedule pay rates,
except that an individual so appointed may not receive
pay in excess of the annual rate of basic pay payable
for level V of the Executive Schedule under section
5316 of such title.
(B) Detailees.--Upon request of the Staff Director,
the head of any Federal department or agency may detail
any of the personnel of that department or agency to
the Commission to assist the Commission in carrying out
its duties under this Act. Not more than one-third of
the personnel employed by or detailed to the Commission
may be on detail from any Government agency.
(3) Experts and consultants.--The Commission may procure by
contract, to the extent funds are available, the temporary or
intermittent services of experts or consultants pursuant to
section 3109 of title 5, United States Code.
(i) Offices and Property.--The Commission may lease space and
acquire personal property to the extent funds are available.
(j) Assistance from GAO.--The Comptroller General of the United
States shall provide assistance, including the detailing of employees,
to the Commission in accordance with an agreement entered into with the
Commission.
(k) Termination.--The Commission shall terminate 30 days after the
date of submission of the report required in section 802(b).
SEC. 804. POWERS.
(a) Hearings and Other Activities.--For the purpose of carrying out
its duties, the Commission may hold such hearings and undertake such
other activities as the Commission determines to be necessary to carry
out its duties.
(b) Studies by General Accounting Office.--Upon the request of the
Commission, the Comptroller General shall conduct such studies or
investigations as the Commission determines to be necessary to carry
out its duties.
(c) Cost Estimates by Congressional Budget Office.--
(1) In general.--Upon the request of the Commission, the
Director of the Congressional Budget Office shall provide to
the Commission such cost estimates as the Commission determines
to be necessary to carry out its duties.
(2) Reimbursement.--The Commission shall reimburse the
Director of the Congressional Budget Office for expenses
relating to the employment in the office of the Director of
such additional staff as may be necessary for the Director to
comply with requests by the Commission under paragraph (1).
(d) Technical Assistance.--Upon the request of the Commission, the
head of a Federal agency shall provide such technical assistance to the
Commission as the Commission determines to be necessary to carry out
its duties.
(e) Use of Mails.--The Commission may use the United States mails
in the same manner and under the same conditions as Federal agencies,
and shall, for purposes of the frank, be considered a commission of
Congress as described in section 3215 of title 39, United States Code.
(f) Obtaining Information.--The Commission may secure directly from
any Federal agency information necessary to enable it to carry out its
duties, if the information may be disclosed under section 552 of title
5, United States Code. Upon request of the Chairman of the Commission,
the head of such agency shall furnish such information to the
Commission.
(g) Administrative Support Services.--Upon the request of the
Commission, the Administrator of General Services shall provide to the
Commission on a reimbursable basis such administrative support services
as the Commission may request.
(h) Acceptance of Donations.--The Commission may accept, use, and
dispose of gifts or donations of services or property.
(i) Printing.--For purposes of costs relating to printing and
binding, including the costs of personnel detailed from the Government
Printing Office, the Commission shall be deemed to be a committee of
the Congress.
SEC. 805. CONGRESSIONAL CONSIDERATION OF RECOMMENDATIONS.
(a) Introduction of Recommendations.--The legislative language
transmitted pursuant to section 802 with the recommendations of the
Commission shall be in the form of a joint resolution. Such joint
resolution may be introduced in either House of the Congress by any
member thereof.
(b) Terms of the Resolution.--For purposes of this section, the
term ``joint resolution'' means a joint resolution that--
(1) does not have a preamble;
(2) sets forth after the resolving clause only the
legislative language contained in the report from the
Commission; and
(3) is entitled a ``Joint resolution approving the
recommendations of the Social Security Transition
Commission.''.
(c) Expedited Procedure.--
(1) Referral.--A joint resolution that is introduced in the
House of Representatives shall be referred to the Committee on
Government Operations of the House of Representatives. A joint
resolution that is introduced in the Senate shall be referred
to the Committee on Governmental Affairs of the Senate.
(2) Discharge.--If the committee to which a joint
resolution is referred has not reported the resolution (or an
identical resolution) by the end of the 30-day period beginning
on the date on which the Commission transmits the report to the
Congress, such committee shall, at the end of that period, be
discharged from further consideration of the resolution, and
the resolution shall be placed on the appropriate calendar of
the House of Representatives or the Senate, as the case may be.
(3) Consideration.--
(A) In general.--On or after the first day after
the date on which the committee to which a joint
resolution is referred has reported, or has been
discharged (under paragraph (3)) from further
consideration of, such a resolution, it is in order
(even though a previous motion to the same effect has
been disagreed to) for any member of the House of
Representatives or the Senate, respectively, to move to
proceed to the consideration of the resolution (but
only on the date after the calendar day on which the
member announces to the House concerned the member's
intention to do so).
(B) Points of order waived.--All points of order
against a joint resolution (and against consideration
of the resolution) are waived.
(C) Motion to proceed.--A motion to proceed to the
consideration of a joint resolution is highly
privileged in the House of Representatives and is
privileged in the Senate and is not debatable. The
motion is not subject to amendment, to a motion to
postpone consideration of the resolution, or to a
motion to proceed to the consideration of other
business. A motion to reconsider the vote by which the
motion to proceed is agreed to or not agreed to shall
not be in order. If the motion to proceed is agreed to,
the House of Representatives or the Senate, as the case
may be, shall immediately proceed to consideration of
the joint resolution without intervening motion, order,
or other business, and the resolution shall remain the
unfinished business of the House of Representatives or
the Senate, as the case may be, until disposed of.
(D) Limited debate.--Debate on a joint resolution
and on all debatable motions and appeals in connection
therewith shall be limited to not more than 5 hours,
which shall be divided equally between those favoring
and those opposing the resolution. A motion further to
limit debate on a joint resolution is in order and not
debatable.
(E) Amendments not in order.--An amendment to a
joint resolution is not in order.
(F) Other motions not in order.--A motion to
postpone consideration of a joint resolution, a motion
to proceed to the consideration of other business, or a
motion to recommit the resolution is not in order. A
motion to reconsider the vote by which a joint
resolution is agreed to or not agreed to is not in
order.
(G) Vote on final passage.--Immediately following
the conclusion of the debate on a joint resolution and
a single quorum call at the conclusion of the debate if requested in
accordance with the rules of the House of Representatives or the
Senate, as the case may be, the vote on final passage of the resolution
shall occur.
(H) Appeals.--Appeals from the decisions of the
Chair relating to the application of the rules of the
House of Representatives or of the Senate, as the case
may be, to the procedure relating to a joint resolution
shall be decided without debate.
(4) Consideration by other house.--If, before the passage
by one House of a joint resolution that was introduced in such
House, such House receives from the other House a joint
resolution as passed by such other House--
(A) the resolution of the other House shall not be
referred to a committee and may not be considered in
the House that receives it otherwise than on final
passage under subparagraph (C);
(B) the procedure in the House in receipt of the
resolution of the other House, with respect to the
joint resolution that was introduced in House in
receipt of the resolution of the other House, shall be
the same as if no resolution had been received from the
other House; and
(C) notwithstanding subparagraph (B), the vote on
final passage shall be on the resolution of the other
House.
Upon disposition of a joint resolution that is received by one
House from the other House, it shall no longer be in order to
consider the joint resolution that was introduced in the
receiving House.
(5) Date certain.--If the Senate and the House of
Representatives have not acted upon the joint resolution by
September 30, 2001, then on that day or the next day of session
thereafter the joint resolution shall be called up by the
Presiding Officer of each House upon convening and a roll call
vote shall be conducted on passage. If the joint resolution
passes one House a vote on final passage shall be immediately
conducted in the other House.
(6) Rules of the senate and house of representatives.--This
subsection is enacted by Congress--
(A) as an exercise of the rulemaking power of the
Senate and House of Representatives, respectively, and
is deemed to be part of the rules of each House,
respectively, but applicable only with respect to the
procedure to be followed in that House in the case of a
joint resolution, and it supersedes other rules only to
the extent that it is inconsistent with such rules; and
(B) with full recognition of the constitutional
right of either House to change the rules (so far as
they relate to the procedure of that House) at any
time, in the same manner, and to the same extent as in
the case of any other rule of that House.
SEC. 806. DEFINITIONS.
As used in this title, the terms ``budget outlay'', ``outlay'',
``new budget authority'', ``direct spending'', and ``OMB'' have the
meanings given to such terms by section 250(c) of the Balanced Budget
and Emergency Deficit Control Act of 1985.
SEC. 807. AUTHORIZATION OF APPROPRIATIONS.
There is hereby authorized to be made available for fiscal years
1999, 2000, and 2001, from amounts not otherwise appropriated in the
general fund of the Treasury, such sums as are necessary to carry out
the provisions of this title.
<all>
Introduced in House
Introduced in House
Sponsor introductory remarks on measure. (CR H9713)
Referred to House Ways and Means
Referred to the Committee on Ways and Means, and in addition to the Committees on Education and the Workforce, Rules, and Banking and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to House Education and the Workforce
Referred to House Rules
Referred to House Banking and Financial Services
Referred to the Subcommittee on Social Security.
Referred to the Subcommittee on Financial Institutions and Consumer Credit.
Referred to the Subcommittee on Employer-Employee Relations.
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