Save Community Newspaper Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 1916 To amend the Internal Revenue Code of 1986 and the Employee Retirement Income Security Act of 1974 to provide alternative minimum funding rules for certain single-employer plans maintained by a community news- paper. IN THE HOUSE OF REPRESENTATIVES MARCH 27, 2019 Ms. DELBENE (for herself, Mrs. RODGERS of Washington, Mr. SMITH of Washington, and Mr. NEWHOUSE) introduced the following bill; which was referred to the Committee on Education and Labor, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provi- sions as fall within the jurisdiction of the committee concerned A BILL To amend the Internal Revenue Code of 1986 and the Em- ployee Retirement Income Security Act of 1974 to pro- vide alternative minimum funding rules for certain sin- gle-employer plans maintained by a community news- paper. 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 ‘‘Save Community 4 Newspaper Act of 2019’’. 5 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 2 •HR 1916 IH SEC. 2. SPECIAL RULES FOR MINIMUM FUNDING STAND- 1 ARDS FOR COMMUNITY NEWSPAPER PLANS. 2 (a) AMENDMENT TO INTERNAL REVENUE CODE OF 3 1986.—Section 430 of the Internal Revenue Code of 1986 4 is amended by adding at the end the following new sub- 5 section: 6 ‘‘(m) SPECIAL RULES FOR COMMUNITY NEWSPAPER 7 PLANS.— 8 ‘‘(1) IN GENERAL.—The plan sponsor of a com- 9 munity newspaper plan under which no participant 10 has had the participant’s accrued benefit increased 11 (whether because of service or compensation) after 12 December 31, 2017, may elect to have the alter- 13 native standards described in paragraph (3) apply to 14 such plan, and any plan sponsored by any member 15 of the same controlled group, for purposes of this 16 section for plan years beginning with any plan year 17 in effect on or beginning after the date of the enact- 18 ment of this subsection. 19 ‘‘(2) ELECTION.—An election under paragraph 20 (1) shall be made at such time and in such manner 21 as prescribed by the Secretary. Such election, once 22 made with respect to a plan year, shall apply to all 23 subsequent plan years unless revoked with the con- 24 sent of the Secretary. 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 3 •HR 1916 IH ‘‘(3) ALTERNATIVE MINIMUM FUNDING STAND- 1 ARDS.—The alternative standards described in this 2 paragraph are the following: 3 ‘‘(A) INTEREST RATES.— 4 ‘‘(i) IN GENERAL.—Notwithstanding 5 subsection (h)(2)(C) and except as pro- 6 vided in clause (ii), the first, second, and 7 third segment rates in effect for any 8 month for purposes of this section shall be 9 8 percent. 10 ‘‘(ii) NEW BENEFIT ACCRUALS.—Not- 11 withstanding subsection (h)(2), for pur- 12 poses of determining the funding target 13 and normal cost of a plan for any plan 14 year, the present value of any benefits ac- 15 crued or earned under the plan for a plan 16 year with respect to which an election 17 under paragraph (1) is in effect shall be 18 determined on the basis of the U.S. Treas- 19 ury obligation yield curve for the day that 20 is the valuation date of such plan for such 21 plan year. 22 ‘‘(iii) U.S. TREASURY OBLIGATION 23 YIELD CURVE.—For purposes of this sub- 24 section, the term ‘U.S. Treasury obligation 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 4 •HR 1916 IH yield curve’ means, with respect to any 1 day, a yield curve which shall be prescribed 2 by the Secretary for such day on interest- 3 bearing obligations of the United States. 4 ‘‘(B) SHORTFALL AMORTIZATION BASE.— 5 ‘‘(i) PREVIOUS SHORTFALL AMORTIZA- 6 TION BASES.—The shortfall amortization 7 bases determined under subsection (c)(3) 8 for all plan years preceding the first plan 9 year to which the election under paragraph 10 (1) applies (and all shortfall amortization 11 installments determined with respect to 12 such bases) shall be reduced to zero under 13 rules similar to the rules of subsection 14 (c)(6). 15 ‘‘(ii) NEW SHORTFALL AMORTIZATION 16 BASE.—Notwithstanding subsection (c)(3), 17 the shortfall amortization base for the first 18 plan year to which the election under para- 19 graph (1) applies shall be the funding 20 shortfall of such plan for such plan year 21 (determined using the interest rates as 22 modified under subparagraph (A)). 23 ‘‘(C) DETERMINATION OF SHORTFALL AM- 24 ORTIZATION INSTALLMENTS.— 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 5 •HR 1916 IH ‘‘(i) 30-YEAR PERIOD.—Subpara- 1 graphs (A) and (B) of subsection (c)(2) 2 shall be applied by substituting ‘30-plan- 3 year’ for ‘7-plan-year’ each place it ap- 4 pears. 5 ‘‘(ii) NO SPECIAL ELECTION.—The 6 election under subparagraph (D) of sub- 7 section (c)(2) shall not apply to any plan 8 year to which the election under paragraph 9 (1) applies. 10 ‘‘(D) EXEMPTION FROM AT-RISK TREAT- 11 MENT.—Subsection (i) shall not apply. 12 ‘‘(4) COMMUNITY NEWSPAPER PLAN.—For pur- 13 poses of this subsection: 14 ‘‘(A) IN GENERAL.—The term ‘community 15 newspaper plan’ means a plan to which this sec- 16 tion applies maintained by an employer which, 17 as of December 31, 2017— 18 ‘‘(i) publishes and distributes, either 19 electronically or in printed form, 1 or more 20 newspapers, 21 ‘‘(ii) is not a company the stock of 22 which is publicly traded (on a stock ex- 23 change or in an over-the-counter market), 24 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 6 •HR 1916 IH and is not controlled, directly or indirectly, 1 by such a company, and 2 ‘‘(iii) is controlled, directly or indi- 3 rectly— 4 ‘‘(I) by 1 or more persons resid- 5 ing primarily in a State in which the 6 newspaper is published or distributed, 7 ‘‘(II) by a trust or trusts, 1 or 8 more of which was created or orga- 9 nized in a State in which the news- 10 paper is published or distributed, or 11 ‘‘(III) by a combination of per- 12 sons described in subclauses (I) and 13 (II). 14 ‘‘(B) CONTROL.—A person shall be treated 15 as controlled by another person if such other 16 person possesses, directly or indirectly, the 17 power to direct or cause the direction and man- 18 agement of such person (including the power to 19 elect a majority of the members of the board of 20 directors of such person) through the ownership 21 of voting securities. 22 ‘‘(5) CONTROLLED GROUP.—For purposes of 23 this subsection, the term ‘controlled group’ means all 24 persons treated as a single employer under sub- 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 7 •HR 1916 IH section (b), (c), (m), or (o) of section 414 as of the 1 date of the enactment of this subsection.’’. 2 (b) AMENDMENT TO EMPLOYEE RETIREMENT IN- 3 COME SECURITY ACT OF 1974.—Section 303 of the Em- 4 ployee Retirement Income Security Act of 1974 (29 5 U.S.C. 1083) is amended by adding at the end the fol- 6 lowing new subsection: 7 ‘‘(m) SPECIAL RULES FOR COMMUNITY NEWSPAPER 8 PLANS.— 9 ‘‘(1) IN GENERAL.—The plan sponsor of a com- 10 munity newspaper plan under which no participant 11 has had the participant’s accrued benefit increased 12 (whether because of service or compensation) after 13 December 31, 2017, may elect to have the alter- 14 native standards described in paragraph (3) apply to 15 such plan, and any plan sponsored by any member 16 of the same controlled group, for purposes of this 17 section for plan years beginning with any plan year 18 in effect on or beginning after the date of the enact- 19 ment of this subsection. 20 ‘‘(2) ELECTION.—An election under paragraph 21 (1) shall be made at such time and in such manner 22 as prescribed by the Secretary of the Treasury. Such 23 election, once made with respect to a plan year, shall 24 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 8 •HR 1916 IH apply to all subsequent plan years unless revoked 1 with the consent of the Secretary of the Treasury. 2 ‘‘(3) ALTERNATIVE MINIMUM FUNDING STAND- 3 ARDS.—The alternative standards described in this 4 paragraph are the following: 5 ‘‘(A) INTEREST RATES.— 6 ‘‘(i) IN GENERAL.—Notwithstanding 7 subsection (h)(2)(C) and except as pro- 8 vided in clause (ii), the first, second, and 9 third segment rates in effect for any 10 month for purposes of this section shall be 11 8 percent. 12 ‘‘(ii) NEW BENEFIT ACCRUALS.—Not- 13 withstanding subsection (h)(2), for pur- 14 poses of determining the funding target 15 and normal cost of a plan for any plan 16 year, the present value of any benefits ac- 17 crued or earned under the plan for a plan 18 year with respect to which an election 19 under paragraph (1) is in effect shall be 20 determined on the basis of the U.S. Treas- 21 ury obligation yield curve for the day that 22 is the valuation date of such plan for such 23 plan year. 24 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 9 •HR 1916 IH ‘‘(iii) U.S. TREASURY OBLIGATION 1 YIELD CURVE.—For purposes of this sub- 2 section, the term ‘U.S. Treasury obligation 3 yield curve’ means, with respect to any 4 day, a yield curve which shall be prescribed 5 by the Secretary of the Treasury for such 6 day on interest-bearing obligations of the 7 United States. 8 ‘‘(B) SHORTFALL AMORTIZATION BASE.— 9 ‘‘(i) PREVIOUS SHORTFALL AMORTIZA- 10 TION BASES.—The shortfall amortization 11 bases determined under subsection (c)(3) 12 for all plan years preceding the first plan 13 year to which the election under paragraph 14 (1) applies (and all shortfall amortization 15 installments determined with respect to 16 such bases) shall be reduced to zero under 17 rules similar to the rules of subsection 18 (c)(6). 19 ‘‘(ii) NEW SHORTFALL AMORTIZATION 20 BASE.—Notwithstanding subsection (c)(3), 21 the shortfall amortization base for the first 22 plan year to which the election under para- 23 graph (1) applies shall be the funding 24 shortfall of such plan for such plan year 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 10 •HR 1916 IH (determined using the interest rates as 1 modified under subparagraph (A)). 2 ‘‘(C) DETERMINATION OF SHORTFALL AM- 3 ORTIZATION INSTALLMENTS.— 4 ‘‘(i) 30-YEAR PERIOD.—Subpara- 5 graphs (A) and (B) of subsection (c)(2) 6 shall be applied by substituting ‘30-plan- 7 year’ for ‘7-plan-year’ each place it ap- 8 pears. 9 ‘‘(ii) NO SPECIAL ELECTION.—The 10 election under subparagraph (D) of sub- 11 section (c)(2) shall not apply to any plan 12 year to which the election under paragraph 13 (1) applies. 14 ‘‘(D) EXEMPTION FROM AT-RISK TREAT- 15 MENT.—Subsection (i) shall not apply. 16 ‘‘(4) COMMUNITY NEWSPAPER PLAN.—For pur- 17 poses of this subsection: 18 ‘‘(A) IN GENERAL.—The term ‘community 19 newspaper plan’ means a plan to which this sec- 20 tion applies maintained by an employer which, 21 as of December 31, 2017— 22 ‘‘(i) publishes and distributes, either 23 electronically or in printed form, 1 or more 24 newspapers, 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 11 •HR 1916 IH ‘‘(ii) is not a company the stock of 1 which is publicly traded (on a stock ex- 2 change or in an over-the-counter market), 3 and is not controlled, directly or indirectly, 4 by such a company, and 5 ‘‘(iii) is controlled, directly or indi- 6 rectly— 7 ‘‘(I) by 1 or more persons resid- 8 ing primarily in a State in which the 9 newspaper is published or distributed, 10 ‘‘(II) by a trust or trusts, 1 or 11 more of which was created or orga- 12 nized in a State in which the news- 13 paper is published or distributed, or 14 ‘‘(III) by a combination of per- 15 sons described in subclauses (I) and 16 (II). 17 ‘‘(B) CONTROL.—A person shall be treated 18 as controlled by another person if such other 19 person possesses, directly or indirectly, the 20 power to direct or cause the direction and man- 21 agement of such person (including the power to 22 elect a majority of the members of the board of 23 directors of such person) through the ownership 24 of voting securities. 25 VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS 12 •HR 1916 IH ‘‘(5) CONTROLLED GROUP.—For purposes of 1 this subsection, the term ‘controlled group’ means all 2 persons treated as a single employer under sub- 3 section (b), (c), (m), or (o) of section 414 of the In- 4 ternal Revenue Code of 1986 as of the date of the 5 enactment of this subsection. 6 ‘‘(6) EFFECT ON PREMIUM RATE CALCULA- 7 TION.—Notwithstanding any other provision of law 8 or any regulation issued by the Pension Benefit 9 Guaranty Corporation, in the case of a plan with re- 10 spect to which the election under paragraph (1) has 11 been made, the additional premium under section 12 4006(a)(3)(E) shall be determined as if such elec- 13 tion had not been made.’’. 14 (c) EFFECTIVE DATE.—The amendments made by 15 this section shall apply to plan years ending after Decem- 16 ber 31, 2017. 17 Æ VerDate Sep 11 2014 23:01 Apr 10, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6301 E:\BILLS\H1916.IH H1916 pbinns on DSK79D2C42PROD with BILLS