Butch Lewis Emergency Pension Plan Relief Act of 2021

II 117TH CONGRESS 1ST SESSION S. 547 To provide relief for multiemployer and single employer pension plans, and for other purposes. IN THE SENATE OF THE UNITED STATES MARCH 2 (legislative day, MARCH 1), 2021 Mr. BROWN (for himself, Ms. BALDWIN, Mr. BENNET, Mr. BLUMENTHAL, Mr. BOOKER, Ms. CANTWELL, Mr. CASEY, Mr. COONS, Ms. CORTEZ MASTO, Ms. DUCKWORTH, Mr. DURBIN, Mrs. GILLIBRAND, Ms. HASSAN, Mr. HEINRICH, Ms. HIRONO, Mr. KAINE, Mr. KING, Ms. KLOBUCHAR, Mr. LEAHY, Mr. LUJA´N, Mr. MANCHIN, Mr. MARKEY, Mr. MENENDEZ, Mr. MERKLEY, Mrs. MURRAY, Mr. PADILLA, Mr. PETERS, Mr. REED, Ms. ROSEN, Mr. SANDERS, Mr. SCHATZ, Mr. SCHUMER, Mrs. SHAHEEN, Ms. SMITH, Ms. STABENOW, Mr. TESTER, Mr. VAN HOLLEN, Mr. WARNER, Mr. WARNOCK, Ms. WARREN, Mr. WHITEHOUSE, and Mr. WYDEN) intro- duced the following bill; which was read twice and referred to the Com- mittee on Finance A BILL To provide relief for multiemployer and single employer pension plans, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Butch Lewis Emer- 4 gency Pension Plan Relief Act of 2021’’. 5 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 547 IS SEC. 2. SPECIAL PARTITION RELIEF. 1 (a) APPROPRIATION.—Section 4005 of the Employee 2 Retirement Income Security Act of 1974 (29 U.S.C. 1305) 3 is amended by adding at the end the following: 4 ‘‘(i)(1) An eighth fund shall be established for parti- 5 tion assistance to multiemployer pension plans, as pro- 6 vided under section 4233A, and to pay for necessary ad- 7 ministrative and operating expenses relating to such as- 8 sistance. 9 ‘‘(2) There is appropriated from the general fund 10 such amounts as necessary for the costs of providing parti- 11 tion assistance under section 4233A and necessary admin- 12 istrative and operating expenses. The eighth fund estab- 13 lished under this subsection shall be credited with such 14 amounts from time to time as the Secretary of the Treas- 15 ury determines appropriate, from the general fund of the 16 Treasury, and such amounts shall remain available until 17 expended.’’. 18 (b) SPECIAL PARTITION AUTHORITY.—The Em- 19 ployee Retirement Income Security Act of 1974 (29 20 U.S.C. 1001 et seq.) is amended by inserting after section 21 4233 the following: 22 ‘‘SEC. 4233A. SPECIAL PARTITION RELIEF. 23 ‘‘(a) SPECIAL PARTITION AUTHORITY.— 24 ‘‘(1) IN GENERAL.—Upon the application of a 25 plan sponsor of an eligible multiemployer plan for 26 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 547 IS partition of the plan under this section, the corpora- 1 tion shall order a partition of the plan in accordance 2 with this section. 3 ‘‘(2) INAPPLICABILITY OF CERTAIN REPAYMENT 4 OBLIGATION.—A plan receiving partition assistance 5 pursuant to this section shall not be subject to re- 6 payment obligations under section 4261(b)(2). 7 ‘‘(b) ELIGIBLE PLANS.— 8 ‘‘(1) IN GENERAL.—For purposes of this sec- 9 tion, a multiemployer plan is an eligible multiem- 10 ployer plan if— 11 ‘‘(A) the plan is in critical and declining 12 status (within the meaning of section 13 305(b)(6)) in any plan year beginning in 2020 14 through 2024; 15 ‘‘(B) a suspension of benefits has been ap- 16 proved with respect to the plan under section 17 305(e)(9) as of the date of the enactment of 18 this section; 19 ‘‘(C) in any plan year beginning in 2020 20 through 2024, the plan is certified by the plan 21 actuary to be in critical status (within the 22 meaning of section 305(b)(2)), has a modified 23 funded percentage of less than 40 percent, and 24 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 4 •S 547 IS has a ratio of active to inactive participants 1 which is less than 2 to 3; or 2 ‘‘(D) the plan is insolvent for purposes of 3 section 418E of the Internal Revenue Code of 4 1986 as of the date of enactment of this sec- 5 tion, if the plan became insolvent after Decem- 6 ber 16, 2014, and has not been terminated by 7 such date of enactment. 8 ‘‘(2) MODIFIED FUNDED PERCENTAGE.—For 9 purposes of paragraph (1)(C), the term ‘modified 10 funded percentage’ means the percentage equal to a 11 fraction the numerator of which is current value of 12 plan assets (as defined in section 3(26) of such Act) 13 and the denominator of which is current liabilities 14 (as defined in section 431(c)(6)(D) of such Code and 15 section 304(c)(6)(D) of such Act). 16 ‘‘(c) APPLICATIONS FOR SPECIAL PARTITION.— 17 ‘‘(1) GUIDANCE.—The corporation shall issue 18 guidance setting forth requirements for special parti- 19 tion applications under this section not later than 20 120 days after the date of the enactment of this sec- 21 tion. In such guidance, the corporation shall— 22 ‘‘(A) limit the materials required for a spe- 23 cial partition application to the minimum nec- 24 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 5 •S 547 IS essary to make a determination on the applica- 1 tion; and 2 ‘‘(B) provide for an alternate application 3 for special partition under this section, which 4 may be used by a plan that has been approved 5 for a partition under section 4233 before the 6 date of enactment of this section. 7 ‘‘(2) TEMPORARY PRIORITY CONSIDERATION OF 8 APPLICATIONS.— 9 ‘‘(A) IN GENERAL.—The corporation may 10 specify in guidance under paragraph (1) that, 11 during the first 2 years following the date of 12 enactment of this section, special partition ap- 13 plications will be provided priority consider- 14 ation, if— 15 ‘‘(i) the plan is likely to become insol- 16 vent within 5 years of the date of enact- 17 ment of this section; 18 ‘‘(ii) the corporation projects a plan to 19 have a present value of financial assistance 20 payments under section 4261 that exceeds 21 $1,000,000,000 if the special partition is 22 not ordered; 23 ‘‘(iii) the plan has implemented ben- 24 efit suspensions under section 305(e)(9) as 25 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 6 •S 547 IS of the date of the enactment of this sec- 1 tion; or 2 ‘‘(iv) the corporation determines it ap- 3 propriate based on other circumstances. 4 ‘‘(B) NO EFFECT ON AMOUNT OF ASSIST- 5 ANCE.—A plan that is approved for special par- 6 tition assistance under this section shall not re- 7 ceive reduced special partition assistance on ac- 8 count of not receiving priority consideration 9 under subparagraph (A). 10 ‘‘(3) ACTUARIAL ASSUMPTIONS AND OTHER IN- 11 FORMATION.—The corporation shall accept assump- 12 tions incorporated in a multiemployer plan’s deter- 13 mination that it is in critical status or critical and 14 declining status (within the meaning of section 15 305(b)), or that the plan’s modified funded percent- 16 age is less than 40 percent, unless such assumptions 17 are clearly erroneous. The corporation may require 18 such other information as the corporation deter- 19 mines appropriate for making a determination of eli- 20 gibility and the amount of special partition assist- 21 ance necessary under this section. 22 ‘‘(4) APPLICATION DEADLINE.—Any application 23 by a plan for special partition assistance under this 24 section shall be submitted no later than December 25 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 7 •S 547 IS 31, 2026, and any revised application for special 1 partition assistance shall be submitted no later than 2 December 31, 2027. 3 ‘‘(5) NOTICE OF APPLICATION.—Not later than 4 120 days after the date of enactment of this section, 5 the corporation shall issue guidance requiring multi- 6 employer plans to notify participants and bene- 7 ficiaries that the plan has applied for partition 8 under this section, after the corporation has deter- 9 mined that the application is complete. Such notice 10 shall reference the special partition relief internet 11 website described in subsection (p). 12 ‘‘(d) DETERMINATIONS ON APPLICATIONS.—A plan’s 13 application for special partition under this section that is 14 timely filed in accordance with guidance issued under sub- 15 section (c)(1) shall be deemed approved and the corpora- 16 tion shall issue a special partition order unless the cor- 17 poration notifies the plan within 120 days of the filing 18 of the application that the application is incomplete or the 19 plan is not eligible under this section. Such notice shall 20 specify the reasons the plan is ineligible for a special parti- 21 tion or information needed to complete the application. If 22 a plan is denied partition under this subsection, the plan 23 may submit a revised application under this section. Any 24 revised application for special partition submitted by a 25 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 8 •S 547 IS plan shall be deemed approved unless the corporation noti- 1 fies the plan within 120 days of the filing of the revised 2 application that the application is incomplete or the plan 3 is not eligible under this section. A special partition order 4 issued by the corporation shall be effective no later than 5 120 days after a plan’s special partition application is ap- 6 proved by the corporation or deemed approved. 7 ‘‘(e) AMOUNT AND MANNER OF SPECIAL PARTITION 8 ASSISTANCE.— 9 ‘‘(1) IN GENERAL.—The liabilities of an eligible 10 multiemployer plan that the corporation assumes 11 pursuant to a special partition order under this sec- 12 tion shall be the amount necessary for the plan to 13 meet its funding goals described in subsection (g). 14 ‘‘(2) NO CAP.—Liabilities assumed by the cor- 15 poration pursuant to a special partition order under 16 this section shall not be capped by the guarantee 17 under section 4022A. The corporation shall have dis- 18 cretion on how liabilities of the plan are partitioned. 19 ‘‘(f) SUCCESSOR PLAN.— 20 ‘‘(1) IN GENERAL.—The plan created by a spe- 21 cial partition order under this section is a successor 22 plan to which section 4022A applies. 23 ‘‘(2) PLAN SPONSOR AND ADMINISTRATOR.— 24 The plan sponsor of an eligible multiemployer plan 25 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 9 •S 547 IS prior to the special partition and the administrator 1 of such plan shall be the plan sponsor and the ad- 2 ministrator, respectively, of the plan created by the 3 partition. 4 ‘‘(g) FUNDING GOALS.— 5 ‘‘(1) IN GENERAL.—The funding goals of a 6 multiemployer plan eligible for partition under this 7 section are both of the following: 8 ‘‘(A) The plan will remain solvent over 30 9 years with no reduction in a participant’s or 10 beneficiary’s accrued benefit (except to the ex- 11 tent of a reduction in accordance with section 12 305(e)(8) adopted prior to the plan’s applica- 13 tion for partition under this section). 14 ‘‘(B) The funded percentage of the plan 15 (disregarding partitioned benefits) at the end of 16 the 30-year period is projected to be 80 percent. 17 ‘‘(2) BASIS.—The funding projections under 18 paragraph (1) shall be performed on a deterministic 19 basis. 20 ‘‘(h) RESTORATION OF BENEFIT SUSPENSIONS.—An 21 eligible multiemployer plan that is partitioned under this 22 section shall— 23 ‘‘(1) reinstate any benefits that were suspended 24 under section 305(e)(9) or section 4245(a), effective 25 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 10 •S 547 IS as of the first month the special partition order is 1 effective, for participants or beneficiaries as of the 2 effective date of the partition; and 3 ‘‘(2) provide payments equal to the amount of 4 benefits previously suspended to any participants or 5 beneficiaries in pay status as of the effective date of 6 the special partition, payable in the form of a lump 7 sum within 3 months of such effective date or in 8 equal monthly installments over a period of 5 years, 9 with no adjustment for interest. 10 ‘‘(i) ADJUSTMENT OF SPECIAL PARTITION ASSIST- 11 ANCE.— 12 ‘‘(1) IN GENERAL.—Every 5 years, the corpora- 13 tion shall adjust the special partition assistance de- 14 scribed in subsection (e) as necessary for the eligible 15 multiemployer plan to satisfy the funding goals de- 16 scribed in subsection (g). If the 30 year period de- 17 scribed in subsection (g) has lapsed, in applying this 18 paragraph, 5 years shall be substituted for 30 years. 19 ‘‘(2) SUBMISSION OF INFORMATION.—An eligi- 20 ble multiemployer plan that is the subject of a spe- 21 cial partition order under subsection (a) shall submit 22 such information as the corporation may require to 23 determine the amount of the adjustment under para- 24 graph (1). 25 VerDate Sep 11 2014 03:59 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S547.IS S547 pbinns on DSKJLVW7X2PROD with BILLS 11 •S 547 IS ‘‘(3) CESSATION OF ADJUSTMENTS.—Adjust- 1 ments under this subsection with respect to special 2 partition assistance for an eligible multiemployer 3 plan shall cease and the corporation shall perma- 4 nently assume liability for payment of any benefits 5 transferred to the successor plan (subject to sub- 6 section (l)) beginning with the first plan year that 7 the funded percentage of the eligible multiemployer 8 plan (disregarding partitioned benefits) is at least 9 80 percent and the plan’s projected funded percent- 10 age for each of the next 10 years is at least 80 per- 11 cent. Any accumulated funding deficiency of the 12 plan (within the meaning of section 304(a)) shall be 13 reduced to zero as of the first day of the plan year 14 for which partition assistance is permanent under 15 this paragraph. 16 ‘‘(j) CONDITIONS ON PLANS DURING PARTITION.— 17 ‘‘(1) IN GENERAL.—The corporation may im- 18 pose, by regulation, reasonable conditions on an eli- 19 gible multiemployer plan that is partitioned under 20 section (a) relating to increases in future accrual 21 rates and any retroactive benefit improvements, allo- 22 cation of plan assets, reductions in employer con- 23 tribution rates, diversion of contributions to, and al- 24 VerDat [Text truncated for display. Full text available on Congress.gov.]