(Sec. 2) Establishes in the Treasury an Individual Security Fund composed of all established ISAs, and managed by an Individual Security Fund Board. Directs the Board to study and report to the President and Congress on ways to increase an eligible individual's ISA's investment options, especially with respect to ISA rollovers or distributions.
Amends the Internal Revenue Code (IRC) to reduce FICA tax rates on the income of every eligible individual, as well as to impose an ISA contribution on such income, computed according to a specified formula, for crediting to the eligible individual's ISA. Maintains the current FICA tax rates for every individual who is not an eligible individual covered under new SSA title II part B.
Entitles each eligible individual to a specified limited ISA tax credit for the taxable year involved, treated as a tax overpayment, to be transferred by the Secretary for crediting by the Commissioner, as a contribution equal to the tax overpayment, to such eligible individual's ISA for its sole use.
Outlines further similar IRC contribution measures involving contributions based on the earned income tax credit, as well as measures involving the tax treatment of eligible individual ISAs, generally exempting them from income taxation; but including any ISA distribution in gross income for annuity-related purposes, while excluding rollovers.
(Sec. 3) Amends SSA title II new part A to establish a new minimum monthly social security benefit, as adjusted according to the new reduced Consumer Price Index (CPI) increase percentage established by this Act, for certain low-income part A beneficiaries who initially become eligible for OASDI benefits, or who die before becoming eligible for such benefits, after December 31, 2005, and who have at least 80 quarters of coverage. Eliminates the limitation on the amount of outside income (earnings test) which part A beneficiaries who have attained the appropriate retirement age as established by this Act may earn without incurring a reduction in benefits.
(Sec. 5) Amends the Social Security Amendments of 1983, as amended by the Omnibus Budget Reconciliation Act of 1993, to provide for a phased-in reduction to zero, beginning after 2009, of the subtrahend in the formula for certain transfers to the Federal Hospital Insurance Trust Fund under part A (Hospital Insurance) of the Medicare program (SSA title XVIII).
(Sec. 6) Amends SSA title II to provide for the following with regard to the computation of the primary insurance amount: (1) a new formula for determining an individual's average indexed monthly earnings; and (2) a change in the formula for computing the number of an individual's benefit computation years in the case of an individual who is entitled to old-age insurance benefits (with certain current law exceptions still applicable) or in the case of an individual who has died. Provides for a graduated increase in the early and delayed retirement credits under old-age, wife's, husband's, widow's, or widower's insurance benefits provisions.
(Sec. 8) Directs the Commissioner of the Bureau of Labor Statistics (BLS) to publish annually in the Federal Register an estimate of: (1) the number of percentage points by which the annual rate of change in the CPI (achieved substitution bias) is reduced below the rate it would otherwise have attained because of adjustments in the CPI's determination instituted by BLS after December 31, 1998; and (2) the upper level substitution bias retained in the CPI.
Makes appropriations to BLS for: (1) research, evaluation, and implementation of a superlative index to estimate such upper level substitution bias in the CPI; (2) expansion of the Consumer Expenditure Survey and the Point of Purchase Survey; and (3) implementation of revisions to the CPI with respect to SSA title II programs.
Directs BLS to establish an administrative advisory committee to advise it periodically on CPI revisions, and to conduct research and experimentation with alternative data collection and estimating approaches.
Amends SSA title II to revise requirements for determining the cost-of-living increases in primary insurance amounts, redefining CPI increase percentage to provide for an outlined limitation on such increases based on the CPI.
Ties such revision for determining the CPI increase percentage to the relevant indexes used for determining similar annual increases for other specified Federal benefits (including civil service retirement benefits, armed forces retired and retainer pay, and workers' compensation benefits) generally, incorporating BLS's achieved substitution bias correction for instance, and applies a reduced CPI for use under IRC.
Directs the Secretary to transfer, from the Treasury's general fund to the Trust Fund, for each calendar year after 1999, a specified graduated applicable percentage for the year involved of the total wages paid in, and self-employment income credited to, such year.
(Sec. 9) Prescribes an adjustment to the upper two benefit formula factors.
(Sec. 10) Amends SSA title II to phase-in an increase in social security normal and early retirement ages, requiring specified incremental increases in both retirement ages after 2011.
(Sec. 11) Directs the Commissioner to: (1) submit to Congress a study plan on the effects of increased life expectancy on the expected level of retirement income from social security, pensions, and other sources; and (2) provide to Congress an evaluation of such study plan, along with any appropriate recommendations, on whether increased life expectancy requires modification of the disability insurance program under SSA title II and other income support programs.
(Sec. 12) Amends SSA title VII (Administration) to outline a new mechanism for ensuring solvency in the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund (social security trust funds) through Trust Funds Board of Trustees (Board) oversight of the balance ratio of either social security trust fund. Requires the Board to report recommendations to Congress and the President on any statutory adjustments necessary to maintain a balance ratio of either trust fund at not less than 20 percent if the Board determines that the balance ratio of either fund for any calendar year during the succeeding 75 years will be zero, with due regard to the economic conditions that created such inadequacy in the balance ratio, and the amount of time necessary to alleviate it in a prudent manner. Requires such report also to specify the extent to which benefits would have to be reduced, taxes would have to be increased, or a combination thereof, to obtain the desired objectives. Requires the Board also to recommend statutory adjustments to the disability insurance program under SSA title II to modify the changes in disability benefits under the Strengthening Social Security Act of 1998 without reducing the balance ratio of the Federal Disability Insurance Trust Fund. Prescribes procedures for presidential review, disapproval, and approval of reported Board recommendations as well as procedures for congressional consideration of presidential recommendations based on recommendations of the Board.
[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1793 Introduced in House (IH)]
106th CONGRESS
1st Session
H. R. 1793
To amend title II of the Social Security Act to provide for individual
security accounts funded by employee and employer Social Security
payroll deductions, to extend the solvency of the old-age, survivors,
and disability insurance program, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 13, 1999
Mr. Kolbe (for himself, Mr. Stenholm, Mr. Smith of Michigan, Mr. Dooley
of California, Mr. Sanford, Ms. McCarthy of Missouri, and Mr.
Greenwood) introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committee on Rules,
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 amend title II of the Social Security Act to provide for individual
security accounts funded by employee and employer Social Security
payroll deductions, to extend the solvency of the old-age, survivors,
and disability insurance program, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``21st Century
Retirement Act''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Individual security accounts.
Sec. 3. Minimum social security benefit.
Sec. 4. Elimination of earnings test for individuals who have attained
retirement age.
Sec. 5. Reduction in the amount of certain transfers to Medicare Trust
Fund.
Sec. 6. Increase in number of years taken into account in determining
average indexed monthly earnings.
Sec. 7. Actuarial adjustment for retirement.
Sec. 8. Improvements in process for cost-of-living adjustments.
Sec. 9. Adjustment to upper 2 benefit formula factors.
Sec. 10. Phased-in increase in social security retirement ages.
Sec. 11. Modifications in PIA formula to reflect changes in life
expectancy.
Sec. 12. Mechanism for remedying unforeseen deterioration in social
security solvency.
SEC. 2. INDIVIDUAL SECURITY ACCOUNTS.
(a) Establishment and Maintenance of Individual Security
Accounts.--Title II of the Social Security Act (42 U.S.C. 401 et seq.)
is amended--
(1) by inserting before section 201 the following:
``Part A--Insurance Benefits'';
and
(2) by adding at the end the following:
``Part B--Individual Security Accounts
``individual security accounts
``Sec. 251. (a) Establishment.--
``(1) In general.--The Commissioner of Social Security,
within 30 days of the receipt of the first contribution
received pursuant to subsection (b) with respect to an eligible
individual, shall establish in the name of such individual an
individual security account. The individual security account
shall be identified to the account holder by means of the
account holder's Social Security account number.
``(2) Definition of eligible individual.--In this part, the
term `eligible individual' means any individual born after
December 31, 1944.
``(b) Contributions.--
``(1) Amounts transferred from the trust fund.--The
Secretary of the Treasury shall transfer from the Federal Old-
Age and Survivors Insurance Trust Fund, for crediting by the
Commissioner of Social Security to an individual security
account of an eligible individual, an amount equal to the sum
of any amount received by such Secretary on behalf of such
individual under section 3101(a)(2) or 1401(a)(2) of the
Internal Revenue Code of 1986.
``(2) Other contributions.--For provisions relating to
additional contributions credited to individual security
accounts, see sections 531(c)(2) and 6402(l) of the Internal
Revenue Code of 1986.
``(c) Designation of Investment Type of Individual Security
Account.--
``(1) Designation.--Each eligible individual who is
employed or self-employed shall designate the investment type
of individual security account to which the contributions
described in subsection (b) on behalf of such individual are to
be credited.
``(2) Form of designation.--The designation described in
paragraph (1) shall be made in such manner and at such
intervals as the Commissioner of Social Security may prescribe
in order to ensure ease of administration and reductions in
burdens on employers.
``(3) Special rule for 2000.--Not later than January 1,
2000, any eligible individual that is employed or self-employed
as of such date shall execute the designation required under
paragraph (1).
``(4) Designation in absence of designation by eligible
individual.--In any case in which no designation of the
individual security account is made, the Commissioner of Social
Security shall make the designation of the individual security
account in accordance with regulations that take into account
the competing objectives of maximizing returns on investments
and minimizing the risk involved with such investments.
``definition of individual security account; treatment of accounts
``Sec. 252. (a) Individual Security Account.--In this part, the
term `individual security account' means any individual security
account in the Individual Security Fund (established under section 254)
which is administered by the Individual Security Fund Board.
``(b) Treatment of Account.--Except as otherwise provided in this
part and in section 531 of the Internal Revenue Code of 1986, any
individual security account described in subsection (a) shall be
treated in the same manner as an individual account in the Thrift
Savings Fund under subchapter III of chapter 84 of title 5, United
States Code.
``individual security account distributions
``Sec. 253. (a) Date of Initial Distribution.--Except as provided
in subsection (c), distributions may only be made from an individual
security account of an eligible individual on and after the earliest
of--
``(1) the date the eligible individual attains normal
retirement age, as determined under section 216 (or early
retirement age (as so determined) if elected by such
individual), or
``(2) the date on which funds in the eligible individual's
individual security account are sufficient to provide a monthly
payment over the life expectancy of the eligible individual
(determined under reasonable actuarial assumptions) which, when
added to the eligible individual's monthly benefit under part A
(if any), is at least equal to an amount equal to \1/12\ of the
poverty line (as defined in section 673(2) of the Community
Services Block Grant Act (42 U.S.C. 9902(2) and determined on
such date for a family of the size involved) and adjusted
annually thereafter by the adjustment determined under section
215(i).
``(b) Forms of Distribution.--
``(1) Required monthly payments.--Except as provided in
paragraph (2), beginning with the date determined under
subsection (a), the balance in an individual security account
available to provide monthly payments not in excess of the
amount described in subsection (a)(2) shall be paid, as elected
by the account holder (in such form and manner as shall be
prescribed in regulations of the Individual Security Fund
Board), by means of the purchase of annuities or equal monthly
payments over the life expectancy of the eligible individual
(determined under reasonable actuarial assumptions) in
accordance with requirements (which shall be provided in
regulations of the Board) similar to the requirements
applicable to payments of benefits under subchapter III of
chapter 84 of title 5, United States Code, and providing for
indexing for inflation.
``(2) Payment of excess funds.--To the extent funds remain
in an eligible individual's individual security account after
the application of paragraph (1) and to the extent not
inconsistent with the provisions of subchapter III of chapter
84 of title 5, United States Code, such funds shall be payable
to the eligible individual in such manner and in such amounts
as determined by the eligible individual.
``(c) Distribution in the Event of Death Before the Date of Initial
Distribution.--If the eligible individual dies before the date
determined under subsection (a), the balance in such individual's
individual security account shall be distributed in a lump sum, under
rules established by the Individual Security Fund Board, to the
individual's heirs.
``individual security fund
``Sec. 254. (a) Establishment.--There is established and maintained
in the Treasury of the United States an Individual Security Fund in the
same manner as the Thrift Savings Fund under sections 8437, 8438, and
8439 (but not section 8440) of title 5, United States Code.
``(b) Individual Security Fund Board.--
``(1) In general.--There is established and operated in the
Social Security Administration an Individual Security Fund
Board in the same manner as the Federal Retirement Thrift
Investment Board under subchapter VII of chapter 84 of title 5,
United States Code.
``(2) Specific investment and reporting duties.--
``(A) In general.--The Individual Security Fund
Board shall manage and report on the activities of the
Individual Security Fund and the individual security
accounts of such Fund in the same manner as the Federal
Retirement Thrift Investment Board manages and reports
on the Thrift Savings Fund and the individual accounts
of such Fund under subchapter VII of chapter 84 of
title 5, United States Code.
``(B) Study and report on increased investment
options.--
``(i) Study.--The Individual Security Fund
Board shall conduct a study regarding ways to
increase an eligible individual's investment
options with respect to such individual's
individual security account and with respect to
rollovers or distributions from such account.
``(ii) Report.--Not later than 2 years
after the date of enactment of the 21st Century
Retirement Act of 1999, the Individual Security
Fund Board shall submit a report to the
President and Congress that contains a detailed
statement of the results of the study conducted
pursuant to clause (i), together with the
Board's recommendations for such legislative
actions as the Board considers appropriate.
``budgetary treatment of individual security fund and accounts
``Sec. 255. The receipts and disbursements of the Individual
Security Fund and any accounts within such fund shall not be included
in the totals of the budget of the United States Government as
submitted by the President or of the congressional budget and shall be
exempt from any general budget limitation imposed by statute on
expenditures and net lending (budget outlays) of the United States
Government.''.
(b) Modification of FICA Rates.--
(1) Employees.--Section 3101(a) of the Internal Revenue
Code of 1986 (relating to tax on employees) is amended to read
as follows:
``(a) Old-Age, Survivors, and Disability Insurance.--
``(1) In general.--
``(A) Individuals covered under part a of title ii
of the social security act.--In addition to other
taxes, there is hereby imposed on the income of every
individual who is not a part B eligible individual a
tax equal to 6.2 percent of the wages (as defined in
section 3121(a)) received by him with respect to
employment (as defined in section 3121(b)).
``(B) Individuals covered under part b of title ii
of the social security act.--In addition to other
taxes, there is hereby imposed on the income of every
part B eligible individual a tax equal to 4.2 percent
of the wages (as defined in section 3121(a)) received
by such individual with respect to employment (as
defined in section 3121(b)).
``(2) Contribution of oasdi tax reduction to individual
security accounts.--
``(A) In general.--In addition to other taxes,
there is hereby imposed on the income of every part B
eligible individual an individual security account
contribution equal to the sum of--
``(i) 2 percent of the wages (as so
defined) received by such individual with
respect to employment (as so defined), plus
``(ii) so much of such wages (not to exceed
$2,000) as designated by the individual in the
same manner as described in section 251(c) of
the Social Security Act.
``(B) Inflation adjustment.--
``(i) In general.--In the case of any
calendar year beginning after 2000, the dollar
amount in subparagraph (A)(ii) shall be
increased by an amount equal to--
``(I) such dollar amount,
multiplied by
``(II) the cost-of-living
adjustment determined under section
1(f)(3) for the calendar year,
determined by substituting `calendar
year 1999' for `calendar year 1992' in
subparagraph (B) thereof.
``(ii) Rounding.--If any dollar amount
after being increased under clause (i) is not a
multiple of $10, such dollar amount shall be
rounded to the nearest multiple of $10.''.
(2) Self-employed.--Section 1401(a) of the Internal Revenue
Code of 1986 (relating to tax on self-employment income) is
amended to read as follows:
``(a) Old-Age, Survivors, and Disability Insurance.--
``(1) In general.--
``(A) Individuals covered under part a of the
social security act.--In addition to other taxes, there
shall be imposed for each taxable year, on the self-
employment income of every individual who is not a part
B eligible individual for the calendar year ending with
or during such taxable year, a tax equal to 12.40
percent of the amount of the self-employment income for
such taxable year.
``(B) Individuals covered under part b of title ii
of the social security act.--In addition to other
taxes, there is hereby imposed for each taxable year,
on the self-employment income of every part B eligible
individual, a tax equal to 10.4 percent of the amount
of the self-employment income for such taxable year.
``(2) Contribution of oasdi tax reduction to individual
security accounts.--
``(A) In general.--In addition to other taxes,
there is hereby imposed for each taxable year, on the
self-employment income of every individual, an
individual security account contribution equal to the
sum of--
``(i) 2 percent of the amount of the self-
employment income for each individual for such
taxable year; and
``(ii) so much of such self-employment
income (not to exceed $2,000) as designated by
the individual in the same manner as described
in section 251(c) of the Social Security Act.
``(B) Inflation adjustment.--
``(i) In general.--In the case of any
taxable year beginning after 2000, the dollar
amount in subparagraph (A)(ii) shall be
increased by an amount equal to--
``(I) such dollar amount,
multiplied by
``(II) the cost-of-living
adjustment determined under section
1(f)(3) for the calendar year in which
the taxable year begins, determined by
substituting `calendar year 1999' for
`calendar year 1992' in subparagraph
(B) thereof.
``(ii) Rounding.--If any dollar amount
after being increased under clause (i) is not a
multiple of $10, such dollar amount shall be
rounded to the nearest multiple of $10.''.
(3) Part b eligible individual.--
(A) Taxes on employees.--Section 3121 of such Code
(relating to definitions) is amended by inserting after
subsection (s) the following new subsection:
``(t) Part B Eligible Individual.--For purposes of this chapter,
the term `part B eligible individual' means, for any calendar year, an
individual who is an eligible individual (as defined in section
251(a)(2) of the Social Security Act) for such calendar year.''.
(B) Self-employment tax.--Section 1402 of such Code
(relating to definitions) is amended by adding at the
end the following new subsection:
``(k) Part B Eligible Individual.--The term `part B eligible
individual' means, for any calendar year, an individual who is an
eligible individual (as defined in section 251(a)(2) of the Social
Security Act) for such calendar year.''.
(4) Effective dates.--
(A) Employees.--The amendments made by paragraphs
(1) and (3)(A) apply to remuneration paid after
December 31, 1999.
(B) Self-employed individuals.--The amendments made
by paragraphs (2) and (3)(B) apply to taxable years
beginning after December 31, 1999.
(c) Matching Contributions.--
(1) In general.--Part IV of subchapter A of chapter 1 of
the Internal Revenue Code of 1986 (relating to credits against
tax) is amended by adding at the end the following new subpart:
``Subpart H--Individual Security Account Credits
``Sec. 54. Individual security account credit.''.
``SEC. 54. INDIVIDUAL SECURITY ACCOUNT CREDIT.
``(a) Allowance of Credit.--Each part B eligible individual is
entitled to a credit for the taxable year in an amount equal to the sum
of--
``(1) $150,
``(2) 50 percent of the designated wages of such individual
for the taxable year,
``(3) 50 percent of the designated self-employment income
of such individual for the taxable year, and
``(4) 50 percent of the designated earned income credit.
``(b) Limitations.--
``(1) Amount.--The amount determined under subparagraphs
(A) and (B) of paragraph (1) with respect to such individual
for any taxable year may not exceed the excess (if any) of--
``(A) $600, over
``(B) the sum of the amounts received by the
Secretary on behalf of such individual under sections
3101(a)(2)(A)(i) and 1401(a)(2)(A)(i) for the taxable
year.
``(2) Failure to make voluntary contributions.--In the case
of a part B eligible individual with respect to whom the amount
of wages designated under section 3101(a)(2)(A)(ii) plus
the amount self-employment income designated under section
1401(a)(2)(A)(ii) for the taxable year is zero, the credit to which
such individual is entitled under this section shall be equal to zero.
``(c) Definitions.--For purposes of this section--
``(1) Part b eligible individual.--The term `part B
eligible individual' means, for any calendar year, an
individual who is an eligible individual (as defined in section
251(a)(2) of the Social Security Act) for such calendar year.
``(2) Designated wages.--The term `designated wages' means
with respect to any taxable year the amount designated under
section 3101(a)(2)(A)(ii).
``(3) Designated self-employment income.--The term
`designated self-employment income' means with respect to any
taxable year the amount designated under section
1401(a)(2)(A)(ii) for such taxable year.
``(4) Designated earned income credit.--The term
`designated earned income credit' means the amount of the
credit allowed under section 32 for the taxable year that is
designated by the part B eligible individual in the same manner
as described in section 251(c) of the Social Security Act.
``(d) Credit Used Only for Individual Security Account.--For
purposes of this title, the credit allowed under this section with
respect to any part B eligible individual--
``(1) shall not be treated as a credit allowed under this
part, but
``(2) shall be treated as an overpayment of tax under
section 6401(b)(3) which may, in accordance with section
6402(l), only be transferred to an individual security account
established under part B of title II of the Social Security Act
with respect to such individual.''.
(2) Contribution of eitc amounts to individual security
accounts.--Section 32 of such Code (relating to earned income)
is amended by adding at the end the following new subsection:
``(o) Contribution to Individual Security Account.--
``(1) In general.--An eligible part B individual who is
allowed a credit under this section may designate all or a
portion of such credit as a contribution to the individual
security account established on behalf of such individual.
``(2) Credit used only for individual security account.--
For purposes of this title, the amount designated under
paragraph (1) with respect to any part B eligible individual--
``(A) shall not be treated as a credit allowed
under this section, but
``(B) shall be treated as an overpayment of tax
under section 6401(b)(3) which may, in accordance with
section 6402(l), only be transferred to an individual
security account established under part B of title II
of the Social Security Act with respect to such
individual.''.
(3) Contribution of credited amounts to individual security
account.--
(A) Credited amounts treated as overpayment of
tax.--Subsection (b) of section 6401 (relating to
excessive credits) is amended by adding at the end the
following new paragraph:
``(3) Special rule for credit under sections 32 and 54.--
Subject to the provisions of section 6402(l), the following sum
shall be considered an overpayment--
``(A) Section 54 credit.--The amount of any credit
allowed under section 54 for any taxable year, plus
``(B) Section 32 designated earned income credit
contribution.--The amount of the earned income credit
designated as a contribution to an individual security
account under section 32(o) for the taxable year.''.
(B) Transfer of credit amount to individual
security account.--Section 6402 of such Code (relating
to authority to make credits or refunds) is amended by
adding at the end the following new subsection:
``(l) Overpayments Attributable to Individual Security Account
Credit.--In the case of any overpayment described in section 6401(b)(3)
with respect to any individual, the Secretary shall transfer for
crediting by the Commissioner of Social Security to the individual
security account of an such individual, an amount equal to the amount
of such overpayment.''.
(4) Notice to eitc recipients of matching contributions to
individual security accounts.--In connection with information
and tax forms relating to the credit allowed under section 32
of the Internal Revenue Code of 1986, the Secretary of the
Treasury shall provide notice of the availability of matching
contributions pursuant to section 54 of such Code (as added by
subsection (a) of this section) to individual security accounts
under part B of title II of the Social Security Act.
(5) Conforming amendments.--
(A) Section 1324(b)(2) of title 31, United States
Code, is amended by inserting before the period at the
end ``, or enacted by the 21st Century Retirement
Act''.
(B) The table of subparts for part IV of subchapter
A of chapter 1 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new item:
``Subpart H. Individual Security Account Credits.''.
(6) Effective date.--The amendments made by this subsection
shall apply to refunds payable after December 31, 1999.
(d) Tax Treatment of Individual Security Accounts.--
(1) In general.--Subchapter F of chapter 1 of the Internal
Revenue Code of 1986 (relating to exempt organizations) is
amended by adding at the end the following new part:
``PART IX--INDIVIDUAL SECURITY FUND AND ACCOUNTS
``Sec. 531. Individual Security Fund and
Accounts.
``SEC. 531. INDIVIDUAL SECURITY FUND AND ACCOUNTS.
``(a) General Rule.--The Individual Security Fund and individual
security accounts shall be exempt from taxation under this subtitle.
``(b) Individual Security Fund and Accounts Defined.--For purposes
of this section, the terms `Individual Security Fund' and `individual
security account' means the fund and account established under sections
254 and 251, respectively, of part B of title II of the Social Security
Act.
``(c) Contributions.--
``(1) In general.--No deduction shall be allowed for
contributions credited to an individual security account under
section 251 of the Social Security Act or section 6402(l).
``(2) Rollover of inheritance.--Any portion of a
distribution to an heir from an individual security account
made by reason of the death of the beneficiary of such account
may be rolled over to the individual security account of the
heir.
``(d) Distributions.--
``(1) In general.--Any distribution from an individual
security account under section 253 of the Social Security Act
shall be included in gross income under section 72.
``(2) Period in which distributions must be made from
account of decedent.--In the case of amounts remaining in an
individual security account from which distributions began
before the death of the beneficiary, rules similar to the rules
of section 401(a)(9)(B) shall apply to distributions of such
remaining amounts.
``(3) Rollovers.--Paragraph (1) shall not apply to amounts
rolled over under subsection (c)(2) in a direct transfer by the
Commissioner of Social Security, under regulations which the
Commissioner shall prescribe.''.
(2) Clerical amendment.--The table of parts for subchapter
F of chapter 1 of the Internal Revenue Code of 1986 is amended
by adding after the item relating to part VIII the following
new item:
``Part IX. Individual security fund and
accounts.''.
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years beginning after December 31, 1999.
SEC. 3. MINIMUM SOCIAL SECURITY BENEFIT.
Section 215 of the Social Security Act (42 U.S.C. 415) is amended
by adding at the end the following:
``Minimum Monthly Insurance Benefit
``(j)(1) Notwithstanding the preceding provisions of this section--
``(A) the primary insurance amount of a qualified
individual shall be equal to the greater of--
``(i) the primary insurance amount determined under
this section (without regard to this subsection), or
``(ii) \1/12\ of the applicable percentage of the
applicable amount, and
``(B) any recomputation of the primary insurance amount of
a qualified individual shall not result in a primary insurance
amount less than the primary insurance amount as in effect
immediately prior to such recomputation.
``(2) For purposes of this subsection--
``(A) The term `qualified individual' means an individual--
``(i) who initially becomes eligible for old-age or
disability insurance benefits, or dies (before becoming
eligible for such benefits) for a month beginning after
December 31, 2005, and
``(ii) who has at least 80 quarters of coverage.
``(B) The term `applicable amount' means, in connection
with an individual, $7,992 adjusted annually--
``(i)(I) with respect to an individual whose
initial month of eligibility occurs in a year prior to
2011, by the CPI increase percentage determined under
section 215(i) for 1996 through the year prior to such
year of eligibility; and
``(II) with respect to an individual whose initial
month of eligibility occurs in a year after 2010, by
the CPI increase percentage determined under such
section for 1996 through 2009, and by the wage increase
percentage determined under such section for 2009
through the second year prior to the year of such
eligibility; and
``(ii) by the CPI increase percentage determined
under such section for all years beginning with the
year of an individual's initial eligibility.
``(C)(i) The term `applicable percentage' means, for
computations and recomputations of a qualified individual's
primary insurance amount under this section whose initial
eligibility occurs in any calendar year specified in the table
under clause (ii), the sum of--
``(I) the applicable base percentage specified in
such table in connection with such year, plus
``(II) the product derived by multiplying the
applicable percentage increment specified in such table
in connection with such year by the ratio of the number
of such individual's quarters of coverage (if any) in
excess of the minimum number of quarters required under
subparagraph (A)(ii) but not in excess of twice such
minimum, to such minimum.
``(ii) For purposes of clause (i), the applicable base
percentages and applicable percentage increments are set forth
in connection with calendar years in the following table:
``If the calendar year is: The applicable base And the applicable percentage increment is:
percentage is:
2006................................. 12 percent............. 8 percent
2007................................. 24 percent............. 16 percent
2008................................. 36 percent............. 24 percent
2009................................. 48 percent............. 32 percent
After 2009........................... 60 percent............. 40 percent.''
SEC. 4. ELIMINATION OF EARNINGS TEST FOR INDIVIDUALS WHO HAVE ATTAINED
RETIREMENT AGE.
(a) In General.--Section 203 of the Social Security Act (42 U.S.C.
403) is amended--
(1) in subsection (c)(1), by striking ``the age of
seventy'' and inserting ``retirement age (as defined in section
216(l))'';
(2) in paragraphs (1)(A) and (2) of subsection (d), by
striking ``the age of seventy'' each place it appears and
inserting ``retirement age (as defined in section 216(l))'';
(3) in subsection (f)(1)(B), by striking ``was age seventy
or over'' and inserting ``was at or above retirement age (as
defined in section 216(l))'';
(4) in subsection (f)(3)--
(A) by striking ``33\1/3\ percent'' and all that
follows through ``any other individual,'' and inserting
``50 percent of such individual's earnings for such
year in excess of the product of the exempt amount as
determined under paragraph (8),''; and
(B) by striking ``age 70'' and inserting
``retirement age (as defined in section 216(l))'';
(5) in subsection (h)(1)(A), by striking ``age 70'' each
place it appears and inserting ``retirement age (as defined in
section 216(l))''; and
(6) in subsection (j)--
(A) in the heading, by striking ``Age Seventy'' and
inserting ``Retirement Age''; and
(B) by striking ``seventy years of age'' and
inserting ``having attained retirement age (as defined
in section 216(l))''.
(b) Conforming Amendments Eliminating the Special Exempt Amount for
Individuals Who Have Attained Retirement Age.--
(1) Uniform exempt amount.--Section 203(f)(8)(A) of the
Social Security Act (42 U.S.C. 403(f)(8)(A)) is amended by
striking ``the new exempt amounts (separately stated for
individuals described in subparagraph (D) and for other
individuals) which are to be applicable'' and inserting ``a new
exempt amount which shall be applicable''.
(2) Conforming amendments.--Section 203(f)(8)(B) of such
Act (42 U.S.C. 403(f)(8)(B)) is amended--
(A) in the matter preceding clause (i), by striking
``Except'' and all that follows through ``whichever''
and inserting ``The exempt amount which is applicable
for each month of a particular taxable year shall be whichever'';
(B) in clauses (i) and (ii), by striking
``corresponding'' each place it appears; and
(C) in the last sentence, by striking ``an exempt
amount'' and inserting ``the exempt amount''.
(3) Repeal of basis for computation of special exempt
amount.--Section 203(f)(8)(D) of such Act (42 U.S.C.
403(f)(8)(D)) is repealed.
(c) Additional Conforming Amendments.--
(1) Elimination of redundant references to retirement
age.--Section 203 of the Social Security Act (42 U.S.C. 403) is
amended--
(A) in subsection (c), in the last sentence, by
striking ``nor shall any deduction'' and all that
follows and inserting ``nor shall any deduction be made
under this subsection from any widow's or widower's
insurance benefit if the widow, surviving divorced
wife, widower, or surviving divorced husband involved
became entitled to such benefit prior to attaining age
60.''; and
(B) in subsection (f)(1), by striking subparagraph
(D) and inserting the following: ``(D) for which such
individual is entitled to widow's or widower's
insurance benefits if such individual became so
entitled prior to attaining age 60,''.
(2) Conforming amendment to provisions for determining
amount of increase on account of delayed retirement.--Section
202(w)(2)(B)(ii) of such Act (42 U.S.C. 402(w)(2)(B)(ii)) is
amended--
(A) by striking ``either''; and
(B) by striking ``or suffered deductions under
section 203(b) or 203(c) in amounts equal to the amount
of such benefit''.
(3) Provisions relating to earnings taken into account in
determining substantial gainful activity of blind
individuals.--The second sentence of section 223(d)(4) of such
Act (42 U.S.C. 423(d)(4)) is amended by striking ``if section
102 of the Senior Citizens' Right to Work Act of 1996 had not
been enacted'' and inserting the following: ``if the amendments
to section 203 made by section 102 of the Senior Citizens'
Right to Work Act of 1996 and by the Strengthening Social
Security Act of 1998 had not been enacted''.
(d) Effective Date.--The amendments and repeals made by this
section shall apply with respect to taxable years ending after December
31, 1999.
SEC. 5. REDUCTION IN THE AMOUNT OF CERTAIN TRANSFERS TO MEDICARE TRUST
FUND.
Subparagraph (A) of section 121(e)(1) of the Social Security
Amendments of 1983 (42 U.S.C. 401 note), as amended by section
13215(c)(1) of the Omnibus Budget Reconciliation Act of 1993, is
amended--
(1) in clause (ii), by striking ``the amounts'' and
inserting ``the applicable percentage of the amounts''; and
(2) by adding at the end the following: ``For purposes of
clause (ii), the applicable percentage for a year is equal to
100 percent, reduced (but not below zero) by 10 percentage
points for each year after 2009.''.
SEC. 6. INCREASE IN NUMBER OF YEARS TAKEN INTO ACCOUNT IN DETERMINING
AVERAGE INDEXED MONTHLY EARNINGS.
(a) In General.--Section 215(b) of the Social Security Act (42
U.S.C. 415(b)(1)) is amended--
(1) by striking subparagraph (B) of paragraph (1) and
inserting the following:
``(B) the product derived by multiplying--
``(i) the number of elapsed years, reduced (in any
case to which paragraph (2)(A)(i) applies) to the
extent provided in paragraph (2)(C), by
``(ii) 12.'';
(2) in subparagraph (A) of paragraph (2), by striking all
of such subparagraph as precedes ``Clause (ii),'' and inserting
the following:
``(2)(A) The number of an individual's benefit computation years
equals--
``(i) in the case of an individual who is entitled to old-
age insurance benefits (except as provided in the second
sentence of this subparagraph), or who has died, the number of
his computation base years, and
``(ii) in the case of an individual who is entitled to
disability insurance benefits, the number of elapsed years
reduced by the number of years equal to one-fifth of the number
of elapsed years (disregarding any resulting fractional part of
a year), but not by more than 5 years.''; and
(3) by adding at the end of paragraph (2) the following new
subparagraph:
``(C)(i) For purposes of clause (i) of paragraph (1)(B), the number
of elapsed years shall be reduced pursuant to such clause by the number
of years specified in connection with the calendar year in which such
individual becomes eligible for old-age insurance benefits, or dies
(before becoming eligible for such benefits), as set forth in the
following table:
``If such calendar year is: The applicable number of years is:
2000 or 2001........................................... 5.
2002 or 2003........................................... 4.
2004 or 2005........................................... 3.
2006 or 2007........................................... 2.
2008 or 2009........................................... 1.
After 2009............................................. 0.
``(ii) The reduction provided in clause (i) of paragraph
(1)(B) shall not apply in any case in which--
``(I) the individual is married at the time the
individual becomes eligible for old-age insurance
benefits or dies (before becoming eligible for such
benefits), and
``(II) the total of the wages paid in and self-
employment income credited to the preceding calendar
year with respect to the individual is less than the
total of the wages paid in and self-employment income
credited to such year with respect to the individual's
spouse.''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to individuals attaining early retirement age (as
defined in section 216(l)(2) of the Social Security Act) or dying after
December 31, 1999.
SEC. 7. ACTUARIAL ADJUSTMENT FOR RETIREMENT.
(a) Early Retirement.--
(1) In general.--Section 202(q) of the Social Security Act
(42 U.S.C. 402(q)) is amended--
(A) in paragraph (1)(A), by striking ``\5/9\'' and
inserting ``the applicable fraction (determined under
paragraph (12))''; and
(B) by adding at the end the following:
``(12) For purposes of paragraph (1)(A), the `applicable fraction'
for an individual who attains the age of 62 in--
``(A) any year before 2001, is \5/9\;
``(B) 2001, is \7/12\;
``(C) 2002, is \11/18\;
``(D) 2003, is \23/36\;
``(E) 2004, is \2/3\; and
``(F) 2005 or any succeeding year, is \25/36\.''.
(2) Months beyond first 36 months.--Section 202(q) of such
Act (42 U.S.C. 402(q)(9)) (as amended by paragraph (1)) is
amended--
(A) in paragraph (9)(A), by striking ``five-
twelfths'' and inserting ``the applicable fraction
(determined under paragraph (13))''; and
(B) by adding at the end the following:
``(13) For purposes of paragraph (9)(A), the `applicable fraction'
for an individual who attains the age of 62 in--
``(A) any year before 2001, is \5/12\;
``(B) 2001, is \16/36\;
``(C) 2002, is \16/36\;
``(D) 2003, is \17/36\;
``(E) 2004, is \17/36\; and
``(F) 2005 or any succeeding year, is \1/2\.''.
(3) Effective date.--The amendments made by paragraphs (1)
and (2) shall apply to individuals who attain the age of 62 in
years after 1999.
(b) Delayed Retirement.--Section 202(w)(6) of the Social Security
Act (42 U.S.C. 402(w)(6)) is amended--
(1) in subparagraph (C), by striking ``and'' at the end;
(2) in subparagraph (D), by striking ``2004.'' and
inserting ``2004 and before 2007;''; and
(3) by adding at the end the following:
``(E) \17/24\ of 1 percent in the case of an individual who
attains the age of 62 in a calendar year after 2006 and before
2009;
``(F) \3/4\ of 1 percent in the case of an individual who
attains the age of 62 in a calendar year after 2008 and before
2011;
``(G) \19/24\ of 1 percent in the case of an individual who
attains the age of 62 in a calendar year after 2010 and before
2013; and
``(H) \5/6\ of 1 percent in the case of an individual who
attains the age of 62 in a calendar year after 2012.''.
SEC. 8. IMPROVEMENTS IN PROCESS FOR COST-OF-LIVING ADJUSTMENTS.
(a) Annual Declarations of Achieved Substitution Bias Correction
and Retained Upper Level Substitution Bias.--
(1) Achieved substitution bias correction.--Not later than
October 1, 1999, and annually thereafter, the Commissioner of
the Bureau of Labor Statistics shall publish in the Federal
Register an estimate of the number of percentage points by
which the annual rate of change in the Consumer Price Index is
reduced below the rate it would otherwise have attained by
reason of adjustments in the determination of such index
instituted by the Bureau after December 31, 1998.
(2) Upper level substitution bias.--Not later than August
1, 2000, and annually thereafter, the Commissioner of the
Bureau of Labor Statistics shall publish in the Federal
Register an estimate of the upper level substitution bias
retained in the Consumer Price Index, expressed in terms of a
percentage point effect on the annual rate of change in the
Consumer Price Index for the preceding calendar year determined
through the use of a superlative index that accounts for
changes that consumers make in the quantities of goods and
services consumed.
(b) Funding for CPI Improvements.--
(1) In general.--There is hereby appropriated to the Bureau
of Labor Statistics in the Department of Labor, for each of
fiscal years 1999, 2000, and 2001, $30,000,000 for use by the
Bureau for the following purposes:
(A) Research, evaluation, and implementation of a
superlative index to estimate upper level substitution
bias in the Consumer Price Index.
(B) Expansion of the Consumer Expenditure Survey
and the Point of Purchase Survey.
(C) Implementation of revisions to the Consumer
Price Index with respect to programs under title II of
the Social Security Act (42 U.S.C. 401 et seq.).
(2) Reports.--The Commissioner of the Bureau of Labor
Statistics shall submit reports regarding the use of
appropriations made under paragraph (1) to the Committee on
Appropriations of the House of Representative and the Committee
on Appropriations of the Senate upon the request of each
Committee.
(c) Information Sharing.--The Commissioner of the Bureau of Labor
Statistics may secure directly from the Secretary of Commerce
information necessary for purposes of calculating the Consumer Price
Index. Upon request of the Commissioner of the Bureau of Labor
Statistics, the Secretary of Commerce shall furnish that information to
the Commissioner.
(d) Administrative Advisory Committee.--The Bureau of Labor
Statistics shall, in consultation with the National Bureau of Economic
Research, the American Economic Association, and the National Academy
of Statisticians, establish an administrative advisory committee. The
advisory committee shall periodically advise the Bureau of Labor
Statistics regarding revisions of the Consumer Price Index and conduct
research and experimentation with alternative data collection and
estimating approaches.
(e) Modifications to Cost-of-Living Indexing of Benefits.--
(1) In general.--Section 215(i)(1)(D) of the Social
Security Act (42 U.S.C. 415(i)(1)(D)) is amended to to read as
follows:
``(D) the term `CPI increase percentage', with respect to a
base quarter or cost-of-living computation quarter in any
calendar year, means--
``(i) the percentage (rounded to the nearest one-
hundredth of 1 percent) by which the Consumer Price
Index for that quarter (as prepared by the Department
of Labor) exceeds such index for the most recent prior
calendar quarter which was a base quarter under
subparagraph (A)(ii) or, if later, the most recent
cost-of-living computation quarter under subparagraph
(B),
``(ii) reduced (but not below zero) by the upper
level substitution bias (rounded to the nearest one-
hundredth of 1 percent) retained in such index (as
published by the Secretary of Labor pursuant to section
8(a)(2) of the 21st Century Retirement Act of 1999 in
connection with the annual rate of change in the
Consumer Price Index for the preceding calendar year),
to the extent applicable to such percentage, and
``(iii) reduced further (but not below zero) by the
excess (if any) of 0.33 percentage points over the sum
of--
``(I) the reduction in percentage points
undergone by the percentage described in clause
(i) pursuant to clause (ii), and
``(II) the reduction in percentage points
undergone by the percentage described in clause
(i) (rounded to the nearest one-hundredth of 1
percent) attributable to the achieved
substitution bias correction (as last published
by the Secretary of Labor pursuant to section
8(a)(1) of the 21st Century Retirement Act of
1999), to the extent applicable to such
percentage.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply with respect to increases under section 215(i) of
the Social Security Act effective with the month of December of
years after 1999.
(f) Consumer Price Index Adjustments Applicable to Internal Revenue
Code Provisions.--
(1) In general.--Paragraph (3) of section 1(f) of the
Internal Revenue Code of 1986 (defining cost-of-living
adjustment) is amended by striking the period at the end and
inserting a comma and by inserting at the end the following
flush material:
``reduced (but not below zero) by the number of
percentage points determined under paragraph (8) for
the calendar year for which such adjustment is being
determined.''.
(2) Limitation on increases.--Subsection (f) of section 1
of such Code is amended by adding at the end the following new
paragraph:
``(8) Limitation on increases in cpi.--
``(A) In general.--The number of percentage points
determined under this paragraph for any calendar year
is--
``(i) the upper level substitution bias, to
the extent applicable to the percentage
adjustment under paragraph (3), plus
``(ii) the excess (if any) of 0.33
percentage points over the sum of--
``(I) such upper level substitution
bias, and
``(II) the achieved substitution
bias correction, to the extent
applicable to the percentage adjustment
under paragraph (3).
``(B) Computation of base to reflect limitation.--
The Secretary shall adjust the number taken into
account under paragraph (3)(B) so that any increase
which is not taken into account by reason of
subparagraph (A) shall not be taken into account at any
time so as to allow such increase for any period.
``(C) Definitions.--For purposes of this paragraph,
the terms `achieved substitution bias correction' and
`upper level substitution bias' mean, with respect to
any 12-month period ending on August 31 of a calendar
year, the achieved substitution bias correction and
upper level substitution bias most recently published
by the Secretary of Labor pursuant to section 8(a) of
the 21st Century Retirement Act of 1999 for a period
ending on or before August 31 of such calendar year.''.
(g) Corresponding Amendments to Other Provisions Utilizing the
Consumer Price Index.--
(1) In general.--For purposes of determining the amount of
any cost-of-living adjustment which takes effect for benefits
payable after December 31, 1999, with respect to any benefit
described in paragraph (5)--
(A) any increase in the relevant index (determined
without regard to this subsection) shall be reduced by
the number of percentage points determined under
paragraph (2), and
(B) the amount of the increase in such benefit
shall be equal to the product of--
(i) the increase in the relevant index (as
reduced under subparagraph (A)), and
(ii) the average such benefit for the
preceding calendar year under the program
described in paragraph (5) which provides such
benefit.
(2) Limitation on increases.--
(A) In general.--The number of percentage points
determined under this paragraph for any calendar year
is--
(i) the upper level substitution bias, to
the extent applicable to the percentage
adjustment under the relevant index, plus
(ii) the excess (if any) of 0.33 percentage
points over the sum of--
(I) such upper level substitution
bias, and
(II) the achieved substitution bias
correction, to the extent applicable to
the percentage adjustment under the
relevant index,.
(B) Computation of base to reflect limitation.--Any
increase which is not taken into account by reason of
subparagraph (A) shall not be taken into account at any
time so as to allow such increase for any period.
(3) Paragraph (1) to apply only to computation of benefit
amounts.--Paragraph (1) shall apply only for purposes of
determining the amount of benefits and not for purposes of
determining--
(A) whether a threshold increase in the relevant
index has been met, or
(B) increases in amounts under other provisions of
law not described in paragraph (5) which operate by
reference to increases in such benefits.
(4) Definitions.--For purposes of this subsection--
(A) Cost-of-living adjustment.--The term ``cost-of-
living adjustment'' means any adjustment in the amount
of benefits described in paragraph (5) which is
determined by reference to changes in an index.
(B) Index.--
(i) Index.--The term ``index'' means the
Consumer Price Index and any other index of
price or wages.
(ii) Relevant index.--The term ``relevant
index'' means the index on the basis of which
the amount of the cost-of-living adjustment is
determined.
(C) Achieved substitution bias correction; upper
level substitution bias.--The terms `achieved
substitution bias correction' and `upper level
substitution bias' mean, with respect to the applicable
12-month period preceding a cost-of-living adjustment,
the achieved substitution bias correction and upper
level substitution bias most recently published by the
Secretary of Labor pursuant to section 8(a) of the 21st
Century Retirement Act of 1999.
(5) Benefits to which subsection applies.--For purposes of
this subsection, the benefits described in this paragraph are--
(A) retired and retainer pay subject to adjustment
under section 1401a of title 10, United States Code;
(B) civil service retirement benefits under section
8340 of title 5, United States Code, foreign service
retirement benefits under section 826 of the Foreign
Service Act of 1980, Central Intelligence Agency
retirement benefits under part J of the Central
Intelligence Agency Retirement Act of 1964 for certain
employees, and any other benefits under any similar
provision under any retirement system for employees of
the government of the United States;
(C) Federal workers' compensation under section
8146a of title 5, United States Code;
(D) benefits under section 3(a), 4(a), or 4(f) of
the Railroad Retirement Act of 1974; and
(E) benefits and expenditure limits under title
XVIII or XIX of the Social Security Act.
(6) Benefit.--For purposes of this section, the term
``benefit'' includes a payment.
(h) Recapture to Federal Old-Age and Survivors Insurance Trust
Fund.--Section 201 of the Social Security Act (42 U.S.C. 401) is
amended by adding at the end the following new subsection:
``(n) On July 1 of each calendar year specified in the following
table, the Secretary of the Treasury shall transfer, from the general
fund of the Treasury to the Federal Old-Age and Survivors Insurance
Trust Fund, an amount equal to the applicable percentage for such year,
specified in such table, of the total wages paid in and self-employment
income credited to such year.
``For a calendar year-- The applicable percentage for the
year is--
After 1999 and before 2001.....
0.03 percent.
After 2000 and before 2002.....
0.07 percent.
After 2001 and before 2003.....
0.13 percent.
After 2002 and before 2004.....
0.15 percent.
After 2003 and before 2005.....
0.20 percent.
After 2004 and before 2006.....
0.24 percent.
After 2005 and before 2007.....
0.28 percent.
After 2006 and before 2008.....
0.32 percent.
After 2007 and before 2009.....
0.35 percent.
After 2008 and before 2010.....
0.38 percent.
After 2009 and before 2016.....
0.47 percent.
After 2015 and before 2040.....
0.55 percent.
After 2039 and before 2060.....
0.66 percent.
After 2059.....................
0.80 percent.''.
SEC. 9. ADJUSTMENT TO UPPER 2 BENEFIT FORMULA FACTORS.
Section 215(a)(1)(B) of the Social Security Act (42 U.S.C.
415(a)(1)(B)) is amended--
(1) by redesignating clause (iii) as clause (vi); and
(2) by inserting after clause (ii) the following:
``(iii) For an individual who initially becomes eligible for old-
age or disability insurance benefits, or who dies (before becoming
eligible for such benefits), in any calendar year after 2005, each of
the amounts otherwise established for purposes of clauses (ii) and
(iii) of subparagraph (A) under this subparagraph shall be substituted
with the product derived by successively multiplying, once for each
year of the factoring period for such individual commencing with 2006--
``(I) such amount (after applying this clause for earlier
years of the factoring period), by
``(II) the designated factor for such year.
``(iv) For purposes of clause (iii), the term `factoring period'
means, for an individual, the period beginning with 2006 and ending
with the earlier of--
``(I) the year of the individual's initial eligibility or
death, or
``(II) 2030.
``(v) For purposes of clause (iii), the term `designated factor'
means--
``(I) for a year prior to 2011, 0.985, and
``(II) for a year after 2010, 0.980.''.
SEC. 10. PHASED-IN INCREASE IN SOCIAL SECURITY RETIREMENT AGES.
(a) Normal Retirement Age.--Section 216(l) of the Social Security
Act (42 U.S.C. 416(l) is amended--
(1) in paragraph (1), by striking subparagraphs (A), (B),
(C), (D), and (E) and inserting the following:
``(A) with respect to an individual who attains age
62 (or in the case of a widow's or widower's insurance
benefit, age 60) before January 1, 2000, 65 years of
age;
``(B) with respect to an individual who attains age
62 (or in the case of a widow's or widower's insurance
benefit, age 60) after December 31, 1999 and before
January 1, 2011, 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 age 62 (or in the case of a widow's
or widower's insurance benefit, age 60);
``(C) with respect to an individual who attains age
62 (or in the case of a widow's or widower's insurance
benefit, age 60) after December 31, 2010, and before
January 1, 2012, 67 years of age; and
``(D) with respect to an individual who attains age
62 (or in the case of a widow's or widower's insurance
benefit, age 60) after December 31, 2011, 67 years of
age plus \1/24\ of the number of months in the period
beginning with January 2012 and ending with December of
the year in which the individual attains age 62
(rounded down to a full month).''; and
(2) by striking paragraph (3).
(b) Early Retirement Age.--Section 216(l)(2) of the Social Security
Act (42 U.S.C. 416(l)(2)) is amended to read as follows:
``(2) The term `early retirement age' means--
``(A)(i) in the case of an old-age, wife's, or
husband's insurance benefit, except as provided in
subparagraph (B), age 62, and
``(ii) in the case of a widow's or widower's
insurance benefit, age 60; and
``(B) in the case of an old-age, wife's, or
husband's insurance benefit with respect to an
individual who attains age 62 after December 31, 2011,
62 years of age plus \1/18\ of the number of whole
months elapsing since such date.''.
SEC. 11. MODIFICATION OF PIA FORMULA TO REFLECT CHANGES IN LIFE
EXPECTANCY.
(a) Modification of Formula.--Section 215(a)(1) of the Social
Security Act (42 U.S.C. 415(a)(1)(B)) is amended by redesignating
subparagraph (D) as subparagraph (E) and by inserting after
subparagraph (C) the following new subparagraph:
``(D)(i) For individuals who initially become eligible for old-age
insurance benefits (or who die before becoming eligible for such
benefits) in any calendar year after 2011, the primary insurance amount
computed under this paragraph shall be the product derived by
multiplying such amount as computed under the preceding subparagraphs
of this paragraph the applicable number of times by 0.995.
``(ii) For purposes of the clause (i), the term `applicable number
of times' means a number equal to the number of years beginning with
2012 and ending with the earlier of the year of initial eligibility (or
death) or 2045.''.
(b) Study of the Effect of Increases in Life Expectancy.--
(1) Study plan.--Not later than February 15, 2001, the
Commissioner of Social Security shall submit to Congress a
detailed study plan for evaluating the effects of increases in
life expectancy on the expected level of retirement income from
social security, pensions, and other sources. The study plan
shall include a description of the methodology, data, and
funding that will be required in order to provide to the
Congress not later than February 15, 2006--
(A) an evaluation of trends in mortality and their
relationship to trends in health status, among
individuals approaching eligibility for old-age
insurance benefits under title II of the Social
Security Act;
(B) an evaluation of trends in labor force
participation among individuals approaching eligibility
for such benefits and among individuals receiving such
benefits, and of the factors that influence the choice
between retirement and participation in the labor
force;
(C) an evaluation of changes, if any, in the
disability insurance program under title II of the
Social Security Act that would reduce the impact of
changes in the retirement income of workers in poor
health or physically demanding occupations;
(D) an evaluation of the methodology used to
develop projections for trends in mortality, health
status, and labor force participation among individuals
approaching eligibility for old-age insurance benefits
and among individuals receiving such benefits; and
(E) an evaluation of such other matters as the
Commissioner deems appropriate for evaluating the
effects of increases in life expectancy.
(2) Report on results of study.--Not later than February
15, 2006, the Commissioner of Social Security shall provide to
the Congress an evaluation of the implications of the trends
studied under paragraph (1), along with recommendations, if
any, of the extent to which the conclusions of such evaluations
indicate that projected increases in life expectancy require
modification in the disability insurance program under title II
of the Social Security Act and other income support programs.
SEC. 12. MECHANISM FOR REMEDYING UNFORESEEN DETERIORATION IN SOCIAL
SECURITY SOLVENCY.
(a) In General.--Section 709 of the Social Security Act (42 U.S.C.
910) is amended--
(1) by redesignating subsection (b) as subsection (c); and
(2) by striking ``Sec. 709. (a) If the Board of Trustees''
and all that follows through ``any such Trust Fund'' and
inserting the following:
``Sec. 709. (a)(1)(A) If the Board of Trustees of the Federal Old-
Age and Survivors Insurance Trust Fund and the Federal Disability
Insurance Trust Fund determines at any time, using intermediate
actuarial assumptions, that the balance ratio of either such Trust Fund
for any calendar year during the succeeding period of 75 calendar years
will be zero, the Board shall promptly submit to each House of the
Congress and to the President a report setting forth its
recommendations for statutory adjustments affecting the receipts and
disbursements of such Trust Fund necessary to maintain the balance
ratio of such Trust Fund at not less than 20 percent, with due regard
to the economic conditions which created such inadequacy in the balance
ratio and the amount of time necessary to alleviate such inadequacy in
a prudent manner. The report shall set forth specifically the extent to
which benefits would have to be reduced, taxes under section 1401,
3101, or 3111 of the Internal Revenue Code of 1986 would have to be
increased, or a combination thereof, in order to obtain the objectives
referred to in the preceding sentence.
``(B) In addition to any reports under subparagraph (A), the Board
shall, not later than May 30, 2001, prepare and submit to Congress and
the President recommendations for statutory adjustments to the
disability insurance program under title II of this Act to modify the
changes in disability benefits under the Strengthening Social Security
Act of 1998 without reducing the balance ratio of the Federal
Disability Insurance Trust Fund. The Board shall develop such
recommendations in consultation with the National Council on
Disability, taking into consideration the adequacy of benefits under
the program, the relationship of such program with old age benefits
under such title, and changes in the process for determining initial
eligibility and reviewing continued eligibility for benefits under such
program.
``(2)(A) The President shall, no later than 30 days after the
submission of the report to the President, transmit to the Board and to
the Congress a report containing the President's approval or
disapproval of the Board's recommendations.
``(B) If the President approves all the recommendations of the
Board, the President shall transmit a copy of such recommendations to
the Congress as the President's recommendations, together with a
certification of the President's adoption of such recommendations.
``(C) If the President disapproves the recommendations of the
Board, in whole or in part, the President shall transmit to the Board
and the Congress the reasons for that disapproval. The Board shall then
transmit to the Congress and the President, no later than 60 days after
the date of the submission of the original report to the President, a
revised list of recommendations.
``(D) If the President approves all of the revised recommendations
of the Board transmitted to the President under subparagraph (C), the
President shall transmit a copy of such revised recommendations to the
Congress as the President's recommendations, together with a
certification of the President's adoption of such recommendations.
``(E) If the President disapproves the revised recommendations of
the Board, in whole or in part, the President shall transmit to the
Board and the Congress the reasons for that disapproval, together with
such revisions to such recommendations as the President determines are
necessary to bring such recommendations within the President's
approval. The President shall transmit a copy of such recommendations,
as so revised, to the Board and the Congress as the President's
recommendations, together with a certification of the President's
adoption of such recommendations.
``(3)(A) This paragraph is enacted by Congress--
``(i) as an exercise of the rulemaking power of the Senate
and the House of Representatives, respectively, and as such it
is deemed a 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 described in subparagraph
(B), and it supersedes other rules only to the extent that it is
inconsistent with such rules; and
``(ii) with full recognition of the constitutional right of
either House to change the rules (so far as relating 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.
``(B) For purposes of this paragraph, the term `joint resolution'
means only a joint resolution which is introduced within the 10-day
period beginning on the date on which the President transmits the
President's recommendations, together with the President's
certification, to the Congress under subparagraph (B), (D), or (E) of
paragraph (2), and--
``(i) which does not have a preamble;
``(ii) the matter after the resolving clause of which is as
follows: `That the Congress approves the recommendations of the
President as transmitted on ____ pursuant to section 709(a) of
the Social Security Act, as follows: ________', the first blank
space being filled in with the appropriate date and the second
blank space being filled in with the statutory adjustments
contained in the recommendations; and
``(iii) the title of which is as follows: `Joint resolution
approving the recommendations of the President regarding social
security.'.
``(C) A joint resolution described in subparagraph (B) that is
introduced in the House of Representatives shall be referred to the
Committee on Ways and Means of the House of Representatives. A joint
resolution described in subparagraph (B) introduced in the Senate shall
be referred to the Committee on Finance of the Senate.
``(D) If the committee to which a joint resolution described in
subparagraph (B) is referred has not reported such joint resolution (or
an identical joint resolution) by the end of the 20-day period
beginning on the date on which the President transmits the
recommendation to the Congress under paragraph (2), such committee
shall be, at the end of such period, discharged from further
consideration of such joint resolution, and such joint resolution shall
be placed on the appropriate calendar of the House involved.
``(E)(i) On or after the third day after the date on which the
committee to which such a joint resolution is referred has reported, or
has been discharged (under subparagraph (D)) from further consideration
of, such a joint resolution, it is in order (even though a previous
motion to the same effect has been disagreed to) for any Member of the
respective House to move to proceed to the consideration of the joint
resolution. A Member may make the motion only on the day after the
calendar day on which the Member announces to the House concerned the
Member's intention to make the motion, except that, in the case of the
House of Representatives, the motion may be made without such prior
announcement if the motion is made by direction of the committee to
which the joint resolution was referred. All points of order against
the joint resolution (and against consideration of the joint
resolution) are waived. The motion 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, or to a motion to postpone, or
to a motion to proceed to the consideration of other business. A motion
to reconsider the vote by which the motion is agreed to or disagreed to
shall not be in order. If a motion to proceed to the consideration of
the joint resolution is agreed to, the respective House shall
immediately proceed to consideration of the joint resolution without
intervening motion, order, or other business, and the joint resolution
shall remain the unfinished business of the respective House until
disposed of.
``(ii) Debate on the joint resolution, and on all debatable motions
and appeals in connection therewith, shall be limited to not more than
2 hours, which shall be divided equally between those favoring and
those opposing the joint resolution. An amendment to the joint
resolution is not in order. A motion further to limit debate is in
order and not debatable. A motion to postpone, or a motion to proceed
to the consideration of other business, or a motion to recommit the
joint resolution is not in order. A motion to reconsider the vote by
which the joint resolution is agreed to or disagreed to is not in
order.
``(iii) Immediately following the conclusion of the debate on a
joint resolution described in subparagraph (B) and a single quorum call
at the conclusion of the debate if requested in accordance with the
rules of the appropriate House, the vote on final passage of the joint
resolution shall occur.
``(iv) Appeals from the decisions of the Chair relating to the
application of the rules of the Senate or the House of Representatives,
as the case may be, to the procedure relating to a joint resolution
described in subparagraph (B) shall be decided without debate.
``(F)(i) If, before the passage by one House of a joint resolution
of that House described in subparagraph (B), that House receives from
the other House a joint resolution described in subparagraph (B), then
the following procedures shall apply:
``(I) The joint resolution of the other House shall not be
referred to a committee and may not be considered in the House
receiving it except in the case of final passage as provided in
subclause (II).
``(II) With respect to a joint resolution described in
subparagraph (B) of the House receiving the joint resolution,
the procedure in that House shall be the same as if no joint
resolution had been received from the other House, but the vote
on final passage shall be on the joint resolution of the other
House.
``(ii) Upon disposition of the joint resolution received from the
other House, it shall no longer be in order to consider the joint
resolution that originated in the receiving House.
``(b) If the Board of Trustees of the Federal Hospital Insurance
Trust Fund or the Federal Supplementary Medical Insurance Trust Fund
determines at any time that the balance ratio of either such Trust
Fund''.
(b) Conforming Amendments.--
(1) Section 709(b) of such Act (as amended by subsection
(a) of this section) is amended by striking ``any such'' and
inserting ``either such''.
(2) Section 709(c) of such Act (as redesignated by
subsection (a) of this section) is amended by inserting ``or
(b)'' after ``subsection (a)''.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Ways and Means, and in addition to the Committee on Rules, 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 the Committee on Ways and Means, and in addition to the Committee on Rules, 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 the Committee on Ways and Means, and in addition to the Committee on Rules, 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 the Subcommittee on Social Security.
Sponsor introductory remarks on measure. (CR H4030)
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