,,ii ,calendar ,no4 #eeb #aacth         
,,congress  #b;d ,session  ,s4 #beaa    
,,in ,,the ,,senate ,,of ,,the ,,united 
,,states  ,june #ai1 #bjad,mr4 ,harkin  
7for himself and ,mr4 ,alexander7       
introduced the following bill2 which was
 read twice and referred to the         
,committee on ,health1 ,education1      
,labor1 and ,pensions  ,september #h1   
#bjad,reported by ,mr4 ,harkin1 with an 
amendment,strike out all after the      
enacting clause and insert the part     
printed in italic  ,a ,,bill  ,to amend 
the ,employee ,retirement ,income       
,security ,act of #aigd to clarify the  
definition of substantial cessation of  
operations4  #a4 ,substantial cessation 
of operations  7a7 ,in general          
,subsection 7e7 of section #djfb of the 
,employee ,retirement ,income ,security 
,act of #aigd 7#bi ,u4,s4,c4 #acfb7 is  
amended-- 7#a7 by striking              
,operations4--,if an employer and       
inserting 8,operations4--  7#a7 ,in     
general ,if an employer  2 and  7#b7 by 

adding at the end the following3  7#b7  
,substantial cessation of operations ,an
 employer shall not be treated as having
 a cessation described in paragraph 7#a7
 unless-- 7,a7 all operations at a      
facility in a location are ceased1 and--
 7i7 such cessation is reasonably       
expected to be permanent2  7ii7 no      
portion of such operations is moved to  
another facility at a different         
location2  7iii7 no portion of such     
operations is assumed by or otherwise   
transferred to another employer2 and    
7iv7 no other operations are reasonably 
expected to be maintained at such       
facility2 and  7,b7 as a result of the  
cessation described in subparagraph     
7,a71 more than #bj percent of the      
employees of the employer have a        
termination of employment that is       
reasonably expected to be permanent4    
,for purposes of subparagraph 7,b71 all 
employees treated as employed by a      
single employer under sections #baj 7c7 
and 7d7 shall be treated as employees of

 the employer4  4  7b7 ,direction to the
 corporation ,the ,pension ,benefit     
,guaranty ,corporation shall not take   
any enforcement1 administrative1 or     
other action pursuant to section        
#djfb7;e7 of the ,employee ,retirement  
,income ,security ,act of #aigd that is 
inconsistent with subparagraph 7,a7 of  
section #djfb7;e77#b7 of such ,act1 as  
added by subsection 7a71 without regard 
to whether the action relates to a      
cessation or other event that occurs    
before or after the date of enactment of
 this ,act1 unless such action is in    
connection with a settlement agreement  
in place before ,june #a1 #bjad4  #a4   
,substantial cessation of operations    
7a7 ,in general ,subsection 7e7 of      
section #djfb of the ,employee          
,retirement ,income ,security ,act of   
#aigd 7#bi ,u4,s4,c4 #acfb7 is amended  
to read as follows3  7e7 ,treatment of  
substantial cessation of operations     
7#a7 ,general rule ,except as provided  
in paragraphs 7#c7 and 7#d71 if there is

 a substantial cessation of operations  
at a facility in any location1 the      
employer shall be treated with respect  
to any single employer plan established 
and maintained by the employer covering 
participants at such facility as if the 
employer were a substantial employer    
under a plan under which more than one  
employer makes contributions and the    
provisions of sections #djfc1 #djfd1 and
 #djfe shall apply4  7#b7 ,substantial  
cessation of operations ,for purposes of
 this subsection3 7,a7 ,in general ,the 
term substantial cessation of operations
 means a permanent cessation of         
operations at a facility which results  
in a workforce reduction of a number of 
eligible employees at the facility      
equivalent to more than #ae percent of  
the number of all eligible employees of 
the employer1 determined immediately    
before the earlier of-- 7i7 the date of 
the employer's decision to implement    
such cessation1 or  7ii7 in the case of 
a workforce reduction which includes #a 

or more eligible employees described in 
paragraph 7#f77;,b71 the earliest date  
on which any such eligible employee was 
separated from employment4  7,b7        
,workforce reduction ,subject to        
subparagraphs 7,c7 and 7,d71 the term   
workforce reduction means the number of 
eligible employees at a facility who are
 separated from employment by reason of 
the permanent cessation of operations of
 the employer at the facility4  7,c7    
,relocation of workforce ,an eligible   
employee separated from employment at a 
facility shall not be taken into account
 in computing a workforce reduction if1 
within a reasonable period of time1 the 
employee is replaced by the employer1 at
 the same or another facility located in
 the ,united ,states1 by an employee who
 is a citizen or resident of the ,united
 ,states4  7,d7 ,dispositions ,if1      
whether by reason of a sale or other    
disposition of the assets or stock of a 
contributing sponsor 7or any member of  
the same controlled group as such a     

sponsor7 of the plan relating to        
operations at a facility or otherwise1  
an employer 7the transferee employer7   
other than the employer which           
experiences the substantial cessation of
 operations 7 the transferor employer7  
conducts any portion of such operations1
 then-- 7i7 an eligible employee        
separated from employment with the      
transferor employer at the facility     
shall not be taken into account in      
computing a workforce reduction if--    
7,i7 within a reasonable period of time1
 the employee is replaced by the        
transferee employer by an employee who  
is a citizen or resident of the ,united 
,states2 and  7,,ii7 in the case of an  
eligible employee who is a participant  
in a single employer plan maintained by 
the transferor employer1 the transferee 
employer1 within a reasonable period of 
time1 maintains a single employer plan  
which includes the assets and           
liabilities attributable to the accrued 
benefit of the eligible employee at the 

time of separation from employment with 
the transferor employer2 and  7ii7 an   
eligible employee who continues to be   
employed at the facility by the         
transferee employer shall not be taken  
into account in computing a workforce   
reduction if-- 7,i7 the eligible        
employee is not a participant in a      
single employer plan maintained by the  
transferor employer1 or  7,,ii7 in any  
other case1 the transferee employer1    
within a reasonable period of time1     
maintains a single employer plan which  
includes the assets and liabilities     
attributable to the accrued benefit of  
the eligible employee at the time of    
separation from employment with the     
transferor employer4  7#c7 ,exemption   
for plans with limited underfunding     
,paragraph 7#a7 shall not apply with    
respect to a single employer plan if1   
for the plan year preceding the plan    
year in which the cessation occurred--  
7,a7 there were fewer than #ajj         
participants with accrued benefits under

 the plan as of the valuation date of   
the plan for the plan year 7as          
determined under section #cjc7;g77#b772 
or  7,b7 the ratio of the market value  
of the assets of the plan to the funding
 target of the plan for the plan year   
was #ij percent or greater4  7#d7       
,election to make additional            
contributions to satisfy liability  7,a7
 ,in general ,an employer may elect to  
satisfy the employer's liability with   
respect to a plan by reason of paragraph
 7#a7 by making additional contributions
 to the plan in the amount determined   
under subparagraph 7,b7 for each plan   
year in the #g-plan-year period         
beginning with the plan year in which   
the cessation occurred4 ,any such       
additional contribution for a plan year 
shall be in addition to any minimum     
required contribution under section #cjc
 for such plan year and shall be paid   
not later than the earlier of-- 7i7 the 
due date for the minimum required       
contribution for such year under section

 #cjc7;j72 or  7ii7 in the case of the  
first such contribution1 the date that  
is #a year after the date on which the  
employer notifies the ,corporation of   
the substantial cessation of operations 
or the date the ,corporation determines 
a substantial cessation of operations   
has occurred1 and in the case of        
subsequent contributions1 the same date 
in each succeeding year4  7,b7 ,amount  
determined  7i7 ,in general ,except as  
provided in clause 7iii71 the amount    
determined under this subparagraph with 
respect to each plan year in the        
#g-plan-year period is the product of-- 
7,i7 #a_/g of the unfunded vested       
benefits determined under section       
#djjf7;a77#c77;,e7 as of the valuation  
date of the plan 7as determined under   
section #cjc7;g77#b77 for the plan year 
preceding the plan year in which the    
cessation occurred2 and  7,,ii7 the     
reduction fraction4  7ii7 ,reduction    
fraction ,for purposes of clause 7i71   
the reduction fraction of a single      

employer plan is equal to-- 7,i7 the    
number of participants with accrued     
benefits in the plan who were included  
in computing the workforce reduction    
under paragraph 7#b77;,b7 as a result of
 the cessation of operations at the     
facility2 divided by  7,,ii7 the number 
of eligible employees of the employer   
who are participants with accrued       
benefits in the plan1 determined as of  
the same date the determination under   
paragraph 7#b77;,a7 is made4  7iii7     
,limitation ,the additional contribution
 under this subparagraph for any plan   
year shall not exceed the excess1 if    
any1 of-- 7,i7 #be percent of the       
difference between the market value of  
the assets of the plan and the funding  
target of the plan for the preceding    
plan year2 over  7,,ii7 the minimum     
required contribution under section #cjc
 for the plan year4  7,c7 ,permitted    
cessation of annual installments when   
plan becomes sufficiently funded ,an    
employer's obligation to make additional

 contributions under this paragraph     
shall not apply to-- 7i7 the first plan 
year 7beginning on or after the first   
day of the plan year in which the       
cessation occurs7 for which the ratio of
 the market value of the assets of the  
plan to the funding target of the plan  
for the plan year is #ij percent or     
greater1 or  7ii7 any plan year         
following such first plan year4  7,d7   
,coordination with funding waivers  7i7 
,in general ,if the ,secretary of the   
,treasury issues a funding waiver under 
section #cjb7;c7 with respect to the    
plan for a plan year in the #g-plan-year
 period under subparagraph 7,a71 the    
additional contribution with respect to 
such plan year shall be permanently     
waived4  7ii7 ,notice ,an employer      
maintaining a plan with respect to which
 such a funding waiver has been issued  
or a request for such a funding waiver  
is pending shall provide notice to the  
,secretary of the ,treasury1 in such    
form and at such time as the ,secretary 

of the ,treasury shall provide1 of a    
cessation of operations to which        
paragraph 7#a7 applies4  7,e7           
,enforcement  7i7 ,notice ,an employer  
making the election under this paragraph
 shall provide notice to the            
,corporation1 in accordance with rules  
prescribed by the ,corporation1 of--    
7,i7 such election1 not later than #cj  
days after the earlier of the date the  
employer notifies the ,corporation of   
the substantial cessation of operations 
or the date the ,corporation determines 
a substantial cessation of operations   
has occurred2  7,,ii7 the payment of    
each additional contribution1 not later 
than #aj days after such payment2       
7,,iii7 any failure to pay the          
additional contribution in the full     
amount for any year in the #g-plan-year 
period1 not later than #aj days after   
the due date for such payment2  7,,iv7  
the waiver under subparagraph 7,d77i7 of
 the obligation to make an additional   
contribution for any year1 not later    

than #cj days after the funding waiver  
described in such subparagraph is       
granted2 and  7,v7 the cessation of any 
obligation to make additional           
contributions under subparagraph 7,c71  
not later than #aj days after the due   
date for payment of the additional      
contribution for the first plan year to 
which such cessation applies4  7ii7     
,acceleration of liability to the plan  
for failure to pay ,if an employer fails
 to pay the additional contribution in  
the full amount for any year in the     
#g-plan-year period by the due date for 
such payment1 the employer shall1 as of 
such date1 be liable to the plan in an  
amount equal to the balance which       
remains unpaid as of such date of the   
aggregate amount of additional          
contributions required to be paid by the
 employer during such #g-year-plan      
period4 ,the ,corporation may waive or  
settle the liability described in the   
preceding sentence1 at the discretion of
 the ,corporation4  7iii7 ,civil action 

,the ,corporation may bring a civil     
action in the district courts of the    
,united ,states in accordance with      
section #djjc7;e7 to compel an employer 
making such election to pay the         
additional contributions required under 
this paragraph4  7#e7 ,definitions ,for 
purposes of this subsection3 7,a7       
,eligible employee ,the term eligible   
employee means an employee who is       
eligible to participate in an employee  
pension benefit plan 7as defined in     
section #c7b77 established and          
maintained by the employer4  7,b7       
,funding target ,the term funding target
 means1 with respect to any plan year1  
the funding target as determined under  
section #djjf7;a77#c77;,e77iii77,i7 for 
purposes of determining the premium paid
 to the ,corporation under section #djjg
 for the plan year4  7,c7 ,market value 
,the market value of the assets of a    
plan shall be determined in the same    
manner as for purposes of section       
#djjf7;a77#c77;,e74  7#f7 ,special rules

  7,a7 ,change in operation of certain  
facilities and property ,for purposes of
 paragraphs 7#a7 and 7#b71 an employer  
shall not be treated as ceasing         
operations at a qualified lodging       
facility 7as defined in section         
#hef7;d77#i77;,d7 of the ,internal      
,revenue ,code of #aihf7 if such        
operations are continued by an eligible 
independent contractor 7as defined in   
section #hef7;d77#i77;,a7 of such ,code7
 pursuant to an agreement with the      
employer4  7,b7 ,aggregation of prior   
separations ,the workforce reduction    
under paragraph 7#b7 with respect to any
 cessation of operations shall be       
determined by taking into account any   
separation from employment of any       
eligible employee at the facility 7other
 than a separation which is not taken   
into account as workforce reduction by  
reason of subparagraph 7,c7 or 7,d7 of  
paragraph 7#b77 which-- 7i7 is related  
to the permanent cessation of operations
 of the employer at the facility1 and   

7ii7 occurs during the #c-year period   
preceding such cessation4  7,c7 ,no     
addition to prefunding balance ,for     
purposes of section #cjc7;f77#f77;,b7   
and section #dcj7;f77#f77;,b7 of the    
,internal ,revenue ,code of #aihf1 any  
additional contribution made under      
paragraph 7#d7 shall be treated in the  
same manner as a contribution an        
employer is required to make in order to
 avoid a benefit reduction under        
paragraph 7#a71 7#b71 or 7#d7 of section
 #bjf7;g7 or subsection 7b71 7c71 or 7e7
 of section #dcf of the ,internal       
,revenue ,code of #aihf for the plan    
year4  4  7b7 ,effective date  7#a7 ,in 
general ,the amendment made by this     
section shall apply to a cessation of   
operations or other event at a facility 
occurring on or after the date of       
enactment of this ,act4  7#b7           
,transition rule ,an employer that had a
 cessation of operations before the date
 of enactment of this ,act 7as          
determined under subsection #djfb7;e7 of

 the ,employee ,retirement ,income      
,security ,act of #aigd as in effect    
before the amendment made by this       
section71 but did not enter into an     
arrangement with the ,pension ,benefit  
,guaranty ,corporation to satisfy the   
requirements of such subsection 7as so  
in effect7 before such date of          
enactment1 shall be permitted to make   
the election under section #djfb7;e77#d7
 of such ,act 7as in effect after the   
amendment made by this section7 as if   
such cessation had occurred on such date
 of enactment4 ,such election shall be  
made not later than #cj days after such 
,corporation issues1 on or after such   
date of the enactment1 a final          
administrative determination that a     
substantial cessation of operations has 
occurred4  7c7 ,direction to the        
,corporation ,the ,pension ,benefit     
,guaranty ,corporation shall not take   
any enforcement1 administrative1 or     
other action pursuant to section        
#djfb7;e7 of the ,employee ,retirement  

,income ,security ,act of #aigd1 or in  
connection with an agreement settling   
liability arising under such section1   
that is inconsistent with the amendment 
made by this section1 without regard to 
whether the action relates to a         
cessation or other event that occurs    
before1 on1 or after the date of the    
enactment of this ,act1 unless such     
action is in connection with a          
settlement agreement that is in place   
before ,june #a1 #bjad4 ,the ,pension   
,benefit ,guaranty ,corporation shall   
not initiate a new enforcement action   
with respect to section #djfb7;e7 of    
such ,act that is inconsistent with its 
enforcement policy in effect on ,june   
#a1 #bjad4  ,september #h1              
#bjad,reported with an amendment