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

Provides for special minimum funding requirements for the pension plans of certain air carriers.

[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 119 Introduced in Senate (IS)]







108th CONGRESS
  1st Session
                                 S. 119

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


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 9, 2003

  Mr. Santorum (for himself, Mr. Specter, Mr. Warner, and Mrs. Dole) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


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

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

SECTION 1. MODIFICATION OF FUNDING REQUIREMENTS FOR CERTAIN PLANS.

    (a) Funding Rules for Certain Plans.--
            (1) In general.--Notwithstanding any other provision of the 
        Internal Revenue Code of 1986 or the Employee Retirement Income 
        Security Act of 1974, the minimum funding rules under paragraph 
        (2) shall apply for any plan year beginning after December 31, 
        2002, in the case of a defined benefit plan which--
                    (A) was established by an air carrier which was 
                granted a conditional loan guarantee by the Air 
                Transport Stabilization Board on July 10, 2002, and 
                which filed for protection under chapter 11 of title 
                11, United States Code, on August 11, 2002, and
                    (B) is maintained for the benefit of such carrier's 
                employees pursuant to a collective bargaining 
                agreement.
            (2) Special funding rule.--
                    (A) In general.--In the case of a plan described in 
                paragraph (1), the minimum funding requirements under 
                this paragraph shall be the requirements set forth in 
                Treasury Regulation section 1.412(c)(1)-3 (as in effect 
                on the date of the enactment of this section).
                    (B) Rules of special application.--In applying the 
                requirements of Treasury Regulation section 
                1.412(c)(1)-3 for purposes of paragraph (1)--
                            (i) the plan shall be treated as having met 
                        the requirements of Treasury Regulation section 
                        1.412(c)(1)-3(a)(2),
                            (ii) the payment schedules shall be 
                        determined--
                                    (I) by using the maximum 
                                amortization period permitted under 
                                section 1.412(c)(1)-3, and
                                    (II) on the basis of the actuarial 
                                valuation of the accrued liability and 
                                the current liability of the plan as of 
                                January 1, 2003, less the actuarial 
                                value of the plan assets on that date,
                            (iii) the payments under a restoration 
                        payment schedule shall be made in level amounts 
                        over the payment period, and
                            (iv) the actuarial value of assets shall be 
                        the fair market value of such assets as of 
                        January 1, 2003, with prospective investment 
                        returns in excess of or less than the assumed 
                        return phased in over 5 years.
    (b) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after December 31, 2002.
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