Of a perfecting nature.

SA 4376. Mr. Thune (for himself, Mr. McConnell, Mr. McCain, Mr.
Isakson, Mr. Bond, Mr. Enzi, Mr. Cornyn, Mr. Barrasso, Mr. Roberts, Mr.
Coburn, Mr. Chambliss, Mr. Brown of Massachusetts, and Mr. Gregg)
proposed an amendment to amendment SA 4369 proposed by Mr. Baucus to
the bill H.R. 4213, to amend the Internal Revenue Code of 1986 to
extend certain expiring provisions, and for other purposes; as follows:

Strike all after the first word and insert the following:

1. SHORT TITLE; AMENDMENT OF 1986 CODE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``American
Jobs and Closing Tax Loopholes Act of 2010''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in titles I, II, and IV of this Act an
amendment or repeal is expressed in terms of an amendment to,
or repeal of, a section or other provision, the reference
shall be considered to be made to a section or other
provision of the Internal Revenue Code of 1986.
(c) Table of Contents.--The table of contents for this Act
is as follows:

Sec. 1. Short title; amendment of 1986 Code; table of contents.

TITLE I--INFRASTRUCTURE INCENTIVES

Sec. 101. Exempt-facility bonds for sewage and water supply facilities.
Sec. 102. Extension of exemption from alternative minimum tax treatment
for certain tax-exempt bonds.
Sec. 103. Allowance of new markets tax credit against alternative
minimum tax.
Sec. 104. Extension of tax-exempt eligibility for loans guaranteed by
Federal home loan banks.
Sec. 105. Extension of temporary small issuer rules for allocation of
tax-exempt interest expense by financial institutions.

TITLE II--EXTENSION OF EXPIRING PROVISIONS

Subtitle A--Energy

Sec. 201. Alternative motor vehicle credit for new qualified hybrid
motor vehicles other than passenger automobiles and light
trucks.
Sec. 202. Incentives for biodiesel and renewable diesel.
Sec. 203. Extension and modification of credit for steel industry fuel.
Sec. 204. Credit for producing fuel from coke or coke gas.
Sec. 205. New energy efficient home credit.
Sec. 206. Special rule for sales or dispositions to implement FERC or
State electric restructuring policy for qualified
electric utilities.
Sec. 207. Suspension of limitation on percentage depletion for oil and
gas from marginal wells.
Sec. 208. Direct payment of energy efficient appliances tax credit.
Sec. 209. Modification of standards for windows, doors, and skylights
with respect to the credit for nonbusiness energy
property.
Sec. 210. Credit for electricity produced at certain open-loop biomass
facilities.
Sec. 211. Excise tax credits and outlay payments for alternative fuel
and alternative fuel mixtures.
Sec. 212. Credit for refined coal facilities.
Sec. 213. Credit for production of low sulfur diesel fuel.

Subtitle B--Individual Tax Relief

PART I--Miscellaneous Provisions

Sec. 221. Deduction for certain expenses of elementary and secondary
school teachers.
Sec. 222. Additional standard deduction for State and local real
property taxes.
Sec. 223. Deduction of State and local sales taxes.
Sec. 224. Contributions of capital gain real property made for
conservation purposes.
Sec. 225. Above-the-line deduction for qualified tuition and related
expenses.
Sec. 226. Tax-free distributions from individual retirement plans for
charitable purposes.
Sec. 227. Look-thru of certain regulated investment company stock in
determining gross estate of nonresidents.

PART II--Low-income Housing Credits

Sec. 231. Election for direct payment of low-income housing credit for
2010.

Subtitle C--Business Tax Relief

Sec. 241. Research credit.
Sec. 242. Indian employment tax credit.
Sec. 243. New markets tax credit.
Sec. 244. Railroad track maintenance credit.
Sec. 245. Mine rescue team training credit.
Sec. 246. Employer wage credit for employees who are active duty
members of the uniformed services.
Sec. 247. 5-year depreciation for farming business machinery and
equipment.
Sec. 248. 15-year straight-line cost recovery for qualified leasehold
improvements, qualified restaurant buildings and
improvements, and qualified retail improvements.
Sec. 249. 7-year recovery period for motorsports entertainment
complexes.
Sec. 250. Accelerated depreciation for business property on an Indian
reservation.
Sec. 251. Enhanced charitable deduction for contributions of food
inventory.
Sec. 252. Enhanced charitable deduction for contributions of book
inventories to public schools.
Sec. 253. Enhanced charitable deduction for corporate contributions of
computer inventory for educational purposes.
Sec. 254. Election to expense mine safety equipment.
Sec. 255. Special expensing rules for certain film and television
productions.
Sec. 256. Expensing of environmental remediation costs.
Sec. 257. Deduction allowable with respect to income attributable to
domestic production activities in Puerto Rico.
Sec. 258. Modification of tax treatment of certain payments to
controlling exempt organizations.
Sec. 259. Exclusion of gain or loss on sale or exchange of certain
brownfield sites from unrelated business income.
Sec. 260. Timber REIT modernization.
Sec. 261. Treatment of certain dividends of regulated investment
companies.
Sec. 262. RIC qualified investment entity treatment under FIRPTA.
Sec. 263. Exceptions for active financing income.
Sec. 264. Look-thru treatment of payments between related controlled
foreign corporations under foreign personal holding
company rules.
Sec. 265. Basis adjustment to stock of S corps making charitable
contributions of property.
Sec. 266. Empowerment zone tax incentives.
Sec. 267. Renewal community tax incentives.
Sec. 268. Temporary increase in limit on cover over of rum excise taxes
to Puerto Rico and the Virgin Islands.
Sec. 269. Payment to American Samoa in lieu of extension of economic
development credit.
Sec. 270. Election to temporarily utilize unused AMT credits determined
by domestic investment.
Sec. 271. Reduction in corporate rate for qualified timber gain.
Sec. 272. Study of extended tax expenditures.

Subtitle D--Temporary Disaster Relief Provisions

PART I--National Disaster Relief

Sec. 281. Waiver of certain mortgage revenue bond requirements.
Sec. 282. Losses attributable to federally declared disasters.
Sec. 283. Special depreciation allowance for qualified disaster
property.
Sec. 284. Net operating losses attributable to federally declared
disasters.
Sec. 285. Expensing of qualified disaster expenses.
Sec. 286. Special depreciation allowance.

[[Page S5116]]

PART II--Regional Provisions

subpart a--new york liberty zone

Sec. 291. Special depreciation allowance for nonresidential and
residential real property.
Sec. 292. Tax-exempt bond financing.

subpart b--go zone

Sec. 295. Increase in rehabilitation credit.
Sec. 296. Work opportunity tax credit with respect to certain
individuals affected by Hurricane Katrina for employers
inside disaster areas.
Sec. 297. Extension of low-income housing credit rules for buildings in
GO zones.
Sec. 298. Tax-exempt bond financing.

subpart c--midwester disaster areas

Sec. 299. Special rules for use of retirement funds.
Sec. 300. Exclusion of cancellation of mortgage indebtedness.

TITLE III--PENSION PROVISIONS

Subtitle A--Single Employer Plans

Sec. 301. Extended period for single-employer defined benefit plans to
amortize certain shortfall amortization bases.
Sec. 302. Application of extended amortization period to plans subject
to prior law funding rules.
Sec. 303. Lookback for certain benefit restrictions.
Sec. 304. Lookback for credit balance rule for plans maintained by
charities.

Subtitle B--Multiemployer Plans

Sec. 321. Adjustments to funding standard account rules.

TITLE IV--REVENUE OFFSETS

Sec. 401. Rollovers from elective deferral plans to Roth designated
accounts.
Sec. 402. Participants in government section 457 plans allowed to treat
elective deferrals as Roth contributions.
Sec. 403. Temporary one-year freeze on raises, bonuses, and other
salary increases for Federal employees.
Sec. 404. Capping the total number of Federal employees.
Sec. 405. Collection of unpaid taxes from employees of the Federal
Government.
Sec. 406. Reducing printing and publishing costs of Government
documents.
Sec. 407. Reducing excessive duplication, overhead and spending within
the Federal Government.
Sec. 408. Eliminating nonessential Government travel.
Sec. 409. Eliminating bonuses for poor performance by Government
contractors.
Sec. 410. $1,000,000,000 limitation on voluntary payments to the United
Nations.
Sec. 411. Rescinding a State department training facility unwanted by
residents of the community in which it is planned to be
constructed.
Sec. 412. Reducing budgets of Members of Congress.
Sec. 413. Disposing of unneeded and unused government property.
Sec. 414. Auctioning and selling of unused and unneeded equipment.
Sec. 415. Rescinding unspent Federal funds.
Sec. 416. Use of stimulus funds to offset spending.
Sec. 417. Deficit Reduction Trust Fund.

TITLE V--UNEMPLOYMENT, HEALTH, AND OTHER ASSISTANCE

Subtitle A--Unemployment Insurance and Other Assistance

Sec. 501. Extension of unemployment insurance provisions.
Sec. 502. Coordination of emergency unemployment compensation with
regular compensation.

Subtitle B--Physician Payment Update and Other Provisions

PART I--Physician Payment Update

Sec. 511. Physician payment update.

PART II--Extension of Expiring Provisions

Sec. 521. Extension of MMA section 508 reclassifications.
Sec. 522. Extension of Medicare work geographic adjustment floor.
Sec. 523. Extension of exceptions process for Medicare therapy caps.
Sec. 524. Extension of payment for technical component of certain
physician pathology services.
Sec. 525. Extension of ambulance add-ons.
Sec. 526. Extension of physician fee schedule mental health add-on
payment.
Sec. 527. Extension of outpatient hold harmless provision.
Sec. 528. Extension of Medicare reasonable costs payments for certain
clinical diagnostic laboratory tests furnished to
hospital patients in certain rural areas.
Sec. 529. Extension of the qualifying individual (QI) program.
Sec. 530. Extension of Transitional Medical Assistance (TMA).
Sec. 531. Extension of DRA court improvement grants.

PART III--Changes to the Patient Protection and Affordable Care Act and
Additional Provisions

subpart a--changes to the patient protection and affordable care act
and additional provisions

Sec. 541. Expansion of affordability exception to individual mandate.
Sec. 542. Replacement of Medicaid primary care payment cliff.
Sec. 543. Establish a CMS-IRS data match to identify fraudulent
providers.
Sec. 544. Funding for claims reprocessing.

subpart b--medical liability reform

Sec. 551. Short title.
Sec. 552. Findings and purpose.
Sec. 553. Definitions.
Sec. 554. Encouraging speedy resolution of claims.
Sec. 555. Compensating patient injury.
Sec. 556. Maximizing patient recovery.
Sec. 557. Additional health benefits.
Sec. 558. Punitive damages.
Sec. 559. Authorization of payment of future damages to claimants in
health care lawsuits.
Sec. 560. Effect on other laws.
Sec. 561. State flexibility and protection of states' rights.
Sec. 562. Applicability; effective date.

TITLE VI--OTHER PROVISIONS

Sec. 601. Extension of national flood insurance program.
Sec. 602. Small business loan guarantee enhancement extensions.
Sec. 603. Summer employment for youth.
Sec. 604. Expansion of eligibility for concurrent receipt of military
retired pay and veterans' disability compensation to
include all chapter 61 disability retirees regardless of
disability rating percentage or years of service.
Sec. 605. Extension of use of 2009 poverty guidelines.
Sec. 606. Refunds disregarded in the administration of Federal programs
and federally assisted programs.
Sec. 607. ARRA planning and reporting.

TITLE VII--BUDGETARY PROVISIONS

Sec. 701. Determination of budgetary effects.

TITLE I--INFRASTRUCTURE INCENTIVES

SEC. 101. EXEMPT-FACILITY BONDS FOR SEWAGE AND WATER SUPPLY
FACILITIES.

(a) Bonds for Water and Sewage Facilities Exempt From
Volume Cap on Private Activity Bonds.--
(1) In general.--Paragraph (3) of section 146(g) is amended
by inserting ``(4), (5),'' after ``(2),''.
(2) Conforming amendment.--Paragraphs (2) and (3)(B) of
section 146(k) are both amended by striking ``(4), (5),
(6),'' and inserting ``(6)''.
(b) Tax-exempt Issuance by Indian Tribal Governments.--
(1) In general.--Subsection (c) of section 7871 is amended
by adding at the end the following new paragraph:
``(4) Exception for bonds for water and sewage
facilities.--Paragraph (2) shall not apply to an exempt
facility bond 95 percent or more of the net proceeds (as
defined in section 150(a)(3)) of which are to be used to
provide facilities described in paragraph (4) or (5) of
section 142(a).''.
(2) Conforming amendment.--Paragraph (2) of section 7871(c)
is amended by striking ``paragraph (3)'' and inserting
``paragraphs (3) and (4)''.
(c) Effective Date.--The amendments made by this section
shall apply to obligations issued after the date of the
enactment of this Act.

SEC. 102. EXTENSION OF EXEMPTION FROM ALTERNATIVE MINIMUM TAX
TREATMENT FOR CERTAIN TAX-EXEMPT BONDS.

(a) In General.--Clause (vi) of section 57(a)(5)(C) is
amended--
(1) by striking ``January 1, 2011'' in subclause (I) and
inserting ``January 1, 2012''; and
(2) by striking ``and 2010'' in the heading and inserting
``, 2010, and 2011''.
(b) Adjusted Current Earnings.--Clause (iv) of section
56(g)(4)(B) is amended--
(1) by striking ``January 1, 2011'' in subclause (I) and
inserting ``January 1, 2012''; and
(2) by striking ``and 2010'' in the heading and inserting
``, 2010, and 2011''.
(c) Effective Date.--The amendments made by this section
shall apply to obligations issued after December 31, 2010.

SEC. 103. ALLOWANCE OF NEW MARKETS TAX CREDIT AGAINST
ALTERNATIVE MINIMUM TAX.

(a) In General.--Subparagraph (B) of section 38(c)(4), as
amended by the Patient Protection and Affordable Care Act, is
amended by redesignating clauses (v) through (ix) as clauses
(vi) through (x), respectively, and by inserting after clause
(iv) the following new clause:
``(v) the credit determined under section 45D, but only
with respect to credits determined with respect to qualified
equity investments (as defined in section 45D(b)) initially
made before January 1, 2012,''.
(b) Effective Date.--The amendments made by this section
shall apply to credits determined with respect to qualified
equity investments (as defined in section 45D(b) of the
Internal Revenue Code of 1986) initially made after March 15,
2010.

SEC. 104. EXTENSION OF TAX-EXEMPT ELIGIBILITY FOR LOANS
GUARANTEED BY FEDERAL HOME LOAN BANKS.

Clause (iv) of section 149(b)(3)(A) is amended by striking
``December 31, 2010'' and inserting ``December 31, 2011''.

[[Page S5117]]

SEC. 105. EXTENSION OF TEMPORARY SMALL ISSUER RULES FOR
ALLOCATION OF TAX-EXEMPT INTEREST EXPENSE BY
FINANCIAL INSTITUTIONS.

(a) In General.--Clauses (i), (ii), and (iii) of section
265(b)(3)(G) are each amended by striking ``or 2010'' and
inserting ``, 2010, or 2011''.
(b) Conforming Amendment.--Subparagraph (G) of section
265(b)(3) is amended by striking ``and 2010'' in the heading
and inserting ``, 2010, and 2011''.
(c) Effective Date.--The amendments made by this section
shall apply to obligations issued after December 31, 2010.

TITLE II--EXTENSION OF EXPIRING PROVISIONS

Subtitle A--Energy

SEC. 201. ALTERNATIVE MOTOR VEHICLE CREDIT FOR NEW QUALIFIED
HYBRID MOTOR VEHICLES OTHER THAN PASSENGER
AUTOMOBILES AND LIGHT TRUCKS.

(a) In General.--Paragraph (3) of section 30B(k) is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to property purchased after December 31, 2009.

SEC. 202. INCENTIVES FOR BIODIESEL AND RENEWABLE DIESEL.

(a) Credits for Biodiesel and Renewable Diesel Used as
Fuel.--Subsection (g) of section 40A is amended by striking
``December 31, 2009'' and inserting ``December 31, 2010''.
(b) Excise Tax Credits and Outlay Payments for Biodiesel
and Renewable Diesel Fuel Mixtures.--
(1) Paragraph (6) of section 6426(c) is amended by striking
``December 31, 2009'' and inserting ``December 31, 2010''.
(2) Subparagraph (B) of section 6427(e)(6) is amended by
striking ``December 31, 2009'' and inserting ``December 31,
2010''.
(c) Effective Date.--The amendments made by this section
shall apply to fuel sold or used after December 31, 2009.

SEC. 203. EXTENSION AND MODIFICATION OF CREDIT FOR STEEL
INDUSTRY FUEL.

(a) Credit Period.--
(1) In general.--Subclause (II) of section 45(e)(8)(D)(ii)
is amended to read as follows:

``(II) Credit period.--In lieu of the 10-year period
referred to in clauses (i) and (ii)(II) of subparagraph (A),
the credit period shall be the period beginning on the date
that the facility first produces steel industry fuel that is
sold to an unrelated person after September 30, 2008, and
ending 2 years after such date.''.

(2) Conforming amendment.--Section 45(e)(8)(D) is amended
by striking clause (iii) and by redesignating clause (iv) as
clause (iii).
(b) Extension of Placed-in-service Date.--Subparagraph (A)
of section 45(d)(8) is amended--
(1) by striking ``(or any modification to a facility)'';
and
(2) by striking ``2010'' and inserting ``2011''.
(c) Clarifications.--
(1) Steel industry fuel.--Subclause (I) of section
45(c)(7)(C)(i) is amended by inserting ``, a blend of coal
and petroleum coke, or other coke feedstock'' after ``on
coal''.
(2) Ownership interest.--Section 45(d)(8) is amended by
adding at the end the following new flush sentence:
``With respect to a facility producing steel industry fuel,
no person (including a ground lessor, customer, supplier, or
technology licensor) shall be treated as having an ownership
interest in the facility or as otherwise entitled to the
credit allowable under subsection (a) with respect to such
facility if such person's rent, license fee, or other
entitlement to net payments from the owner of such facility
is measured by a fixed dollar amount or a fixed amount per
ton, or otherwise determined without regard to the profit or
loss of such facility.''.
(3) Production and sale.--Subparagraph (D) of section
45(e)(8), as amended by subsection (a)(2), is amended by
redesignating clause (iii) as clause (iv) and by inserting
after clause (ii) the following new clause:
``(iii) Production and sale.--The owner of a facility
producing steel industry fuel shall be treated as producing
and selling steel industry fuel where that owner manufactures
such steel industry fuel from coal, a blend of coal and
petroleum coke, or other coke feedstock to which it has
title. The sale of such steel industry fuel by the owner of
the facility to a person who is not the owner of the facility
shall not fail to qualify as a sale to an unrelated person
solely because such purchaser may also be a ground lessor,
supplier, or customer.''.
(d) Specified Credit for Purposes of Alternative Minimum
Tax Exclusion.--Subclause (II) of section 38(c)(4)(B)(iii) is
amended by inserting ``(in the case of a refined coal
production facility producing steel industry fuel, during the
credit period set forth in section 45(e)(8)(D)(ii)(II))''
after ``service''.
(e) Effective Dates.--
(1) In general.--The amendments made by subsections (a),
(b), and (d) shall take effect on the date of the enactment
of this Act.
(2) Clarifications.--The amendments made by subsection (c)
shall take effect as if included in the amendments made by
the Energy Improvement and Extension Act of 2008.

SEC. 204. CREDIT FOR PRODUCING FUEL FROM COKE OR COKE GAS.

(a) In General.--Paragraph (1) of section 45K(g) is amended
by striking ``January 1, 2010'' and inserting ``January 1,
2011''.
(b) Effective Date.--The amendment made by this section
shall apply to facilities placed in service after December
31, 2009.

SEC. 205. NEW ENERGY EFFICIENT HOME CREDIT.

(a) In General.--Subsection (g) of section 45L is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to homes acquired after December 31, 2009.

SEC. 206. SPECIAL RULE FOR SALES OR DISPOSITIONS TO IMPLEMENT
FERC OR STATE ELECTRIC RESTRUCTURING POLICY FOR
QUALIFIED ELECTRIC UTILITIES.

(a) In General.--Paragraph (3) of section 451(i) is amended
by striking ``January 1, 2010'' and inserting ``January 1,
2011''.
(b) Modification of Definition of Independent Transmission
Company.--
(1) In general.--Clause (i) of section 451(i)(4)(B) is
amended to read as follows:
``(i) who the Federal Energy Regulatory Commission
determines in its authorization of the transaction under
section 203 of the Federal Power Act (16 U.S.C. 824b) or by
declaratory order--

``(I) is not itself a market participant as determined by
the Commission, and also is not controlled by any such market
participant, or
``(II) to be independent from market participants or to be
an independent transmission company within the meaning of
such Commission's rules applicable to independent
transmission providers, and''.

(2) Related persons.--Paragraph (4) of section 451(i) is
amended by adding at the end the following flush sentence:
``For purposes of subparagraph (B)(i)(I), a person shall be
treated as controlled by another person if such persons would
be treated as a single employer under section 52.''.
(c) Effective Date.--
(1) In general.--The amendment made by subsection (a) shall
apply to dispositions after December 31, 2009.
(2) Modifications.--The amendments made by subsection (b)
shall apply to dispositions after the date of the enactment
of this Act.

SEC. 207. SUSPENSION OF LIMITATION ON PERCENTAGE DEPLETION
FOR OIL AND GAS FROM MARGINAL WELLS.

(a) In General.--Clause (ii) of section 613A(c)(6)(H) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 208. DIRECT PAYMENT OF ENERGY EFFICIENT APPLIANCES TAX
CREDIT.

In the case of any taxable year which includes the last day
of calendar year 2009 or calendar year 2010, a taxpayer who
elects to waive the credit which would otherwise be
determined with respect to the taxpayer under section 45M of
the Internal Revenue Code of 1986 for such taxable year shall
be treated as making a payment against the tax imposed under
subtitle A of such Code for such taxable year in an amount
equal to 85 percent of the amount of the credit which would
otherwise be so determined. Such payment shall be treated as
made on the later of the due date of the return of such tax
or the date on which such return is filed. Elections under
this section may be made separately for 2009 and 2010, but
once made shall be irrevocable. No amount shall be includible
in gross income or alternative minimum taxable income by
reason of this section.

SEC. 209. MODIFICATION OF STANDARDS FOR WINDOWS, DOORS, AND
SKYLIGHTS WITH RESPECT TO THE CREDIT FOR
NONBUSINESS ENERGY PROPERTY.

(a) In General.--Paragraph (4) of section 25C(c) is amended
by striking ``unless'' and all that follows and inserting
``unless--
``(A) in the case of any component placed in service after
the date which is 90 days after the date of the enactment of
the American Jobs and Closing Tax Loopholes Act of 2010, such
component meets the criteria for such components established
by the 2010 Energy Star Program Requirements for Residential
Windows, Doors, and Skylights, Version 5.0 (or any subsequent
version of such requirements which is in effect after January
4, 2010),
``(B) in the case of any component placed in service after
the date of the enactment of the American Jobs and Closing
Tax Loopholes Act of 2010 and on or before the date which is
90 days after such date, such component meets the criteria
described in subparagraph (A) or is equal to or below a U
factor of 0.30 and SHGC of 0.30, and
``(C) in the case of any component which is a garage door,
such component is equal to or below a U factor of 0.30 and
SHGC of 0.30.''.
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after the date of
the enactment of this Act.

SEC. 210. CREDIT FOR ELECTRICITY PRODUCED AT CERTAIN OPEN-
LOOP BIOMASS FACILITIES.

(a) In General.--Clause (ii) of section 45(b)(4)(B) is
amended by striking ``5-year period'' and inserting ``6-year
period''.
(b) Effective Date.--The amendment made by this section
shall apply to electricity produced and sold after December
31, 2009.

SEC. 211. EXCISE TAX CREDITS AND OUTLAY PAYMENTS FOR
ALTERNATIVE FUEL AND ALTERNATIVE FUEL MIXTURES.

(a) In General.--Sections 6426(d)(5), 6426(e)(3), and
6427(e)(6)(C) are each amended by striking ``December 31,
2009'' and inserting ``December 31, 2010''.
(b) Effective Date.--The amendments made by this section
shall apply to fuel sold or used after December 31, 2009.

[[Page S5118]]

SEC. 212. CREDIT FOR REFINED COAL FACILITIES.

(a) In General.--Subparagraphs (A) and (B) of section
45(d)(8) are each amended by striking ``January 1, 2010'' and
inserting ``January 1, 2011''.
(b) Effective Date.--The amendments made by this section
shall apply to facilities placed in service after December
31, 2009.

SEC. 213. CREDIT FOR PRODUCTION OF LOW SULFUR DIESEL FUEL.

(a) Applicable Period.--Paragraph (4) of section 45H(c) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall take effect as if included in section 339 of the
American Jobs Creation Act of 2004.

Subtitle B--Individual Tax Relief

PART I--MISCELLANEOUS PROVISIONS

SEC. 221. DEDUCTION FOR CERTAIN EXPENSES OF ELEMENTARY AND
SECONDARY SCHOOL TEACHERS.

(a) In General.--Subparagraph (D) of section 62(a)(2) is
amended by striking ``or 2009'' and inserting ``2009, or
2010''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 222. ADDITIONAL STANDARD DEDUCTION FOR STATE AND LOCAL
REAL PROPERTY TAXES.

(a) In General.--Subparagraph (C) of section 63(c)(1) is
amended by striking ``or 2009'' and inserting ``2009, or
2010''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 223. DEDUCTION OF STATE AND LOCAL SALES TAXES.

(a) In General.--Subparagraph (I) of section 164(b)(5) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 224. CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY MADE
FOR CONSERVATION PURPOSES.

(a) In General.--Clause (vi) of section 170(b)(1)(E) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Contributions by Certain Corporate Farmers and
Ranchers.--Clause (iii) of section 170(b)(2)(B) is amended by
striking ``December 31, 2009'' and inserting ``December 31,
2010''.
(c) Effective Date.--The amendments made by this section
shall apply to contributions made in taxable years beginning
after December 31, 2009.

SEC. 225. ABOVE-THE-LINE DEDUCTION FOR QUALIFIED TUITION AND
RELATED EXPENSES.

(a) In General.--Subsection (e) of section 222 is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 226. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT
PLANS FOR CHARITABLE PURPOSES.

(a) In General.--Subparagraph (F) of section 408(d)(8) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to distributions made in taxable years beginning
after December 31, 2009.

SEC. 227. LOOK-THRU OF CERTAIN REGULATED INVESTMENT COMPANY
STOCK IN DETERMINING GROSS ESTATE OF
NONRESIDENTS.

(a) In General.--Paragraph (3) of section 2105(d) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to estates of decedents dying after December 31,
2009.

PART II--LOW-INCOME HOUSING CREDITS

SEC. 231. ELECTION FOR DIRECT PAYMENT OF LOW-INCOME HOUSING
CREDIT FOR 2010.

(a) In General.--Section 42 is amended by redesignating
subsection (n) as subsection (o) and by inserting after
subsection (m) the following new subsection:
``(n) Election for Refundable Credits.--
``(1) In general.--The housing credit agency of each State
shall be allowed a credit in an amount equal to such State's
2010 low-income housing refundable credit election amount,
which shall be payable by the Secretary as provided in
paragraph (5).
``(2) 2010 low-income housing refundable credit election
amount.--For purposes of this subsection, the term `2010 low-
income housing refundable credit election amount' means, with
respect to any State, such amount as the State may elect
which does not exceed 85 percent of the product of--
``(A) the sum of--
``(i) 100 percent of the State housing credit ceiling for
2010 which is attributable to amounts described in clauses
(i) and (iii) of subsection (h)(3)(C), plus any increase in
the State housing credit ceiling for 2010 made by reason of
section 1400N(c) (including as such section is applied by
reason of sections 702(d)(2) and 704(b) of the Tax Extenders
and Alternative Minimum Tax Relief Act of 2008), and
``(ii) 40 percent of the State housing credit ceiling for
2010 which is attributable to amounts described in clauses
(ii) and (iv) of such subsection, plus any increase in the
State housing credit ceiling for 2010 made by reason of the
application of such section 702(d)(2) and 704(b), multiplied
by
``(B) 10.
For purposes of subparagraph (A)(ii), in the case of any area
to which section 702(d)(2) or 704(b) of the Tax Extenders and
Alternative Minimum Tax Relief Act of 2008 applies, section
1400N(c)(1)(A) shall be applied without regard to clause (i)
``(3) Coordination with non-refundable credit.--For
purposes of this section, the amounts described in clauses
(i) through (iv) of subsection (h)(3)(C) with respect to any
State for 2010 shall each be reduced by so much of such
amount as is taken into account in determining the amount of
the credit allowed with respect to such State under paragraph
(1).
``(4) Special rule for basis.--Basis of a qualified low-
income building shall not be reduced by the amount of any
payment made under this subsection.
``(5) Payment of credit; use to finance low-income
buildings.--The Secretary shall pay to the housing credit
agency of each State an amount equal to the credit allowed
under paragraph (1). Rules similar to the rules of
subsections (c) and (d) of section 1602 of the American
Recovery and Reinvestment Tax Act of 2009 shall apply with
respect to any payment made under this paragraph, except that
such subsection (d) shall be applied by substituting `January
1, 2012' for `January 1, 2011'.''.
(b) Conforming Amendment.--Section 1324(b)(2) of title 31,
United States Code, is amended by inserting ``42(n),'' after
``36C,''.

Subtitle C--Business Tax Relief

SEC. 241. RESEARCH CREDIT.

(a) In General.--Subparagraph (B) of section 41(h)(1) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Conforming Amendment.--Subparagraph (D) of section
45C(b)(1) is amended by striking ``December 31, 2009'' and
inserting ``December 31, 2010''.
(c) Effective Date.--The amendments made by this section
shall apply to amounts paid or incurred after December 31,
2009.

SEC. 242. INDIAN EMPLOYMENT TAX CREDIT.

(a) In General.--Subsection (f) of section 45A is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 243. NEW MARKETS TAX CREDIT.

(a) In General.--Subparagraph (F) of section 45D(f)(1) is
amended by inserting ``and 2010'' after ``2009''.
(b) Conforming Amendment.--Paragraph (3) of section 45D(f)
is amended by striking ``2014'' and inserting ``2015''.
(c) Effective Date.--The amendments made by this section
shall apply to calendar years beginning after 2009.

SEC. 244. RAILROAD TRACK MAINTENANCE CREDIT.

(a) In General.--Subsection (f) of section 45G is amended
by striking ``January 1, 2010'' and inserting ``January 1,
2011''.
(b) Effective Date.--The amendment made by this section
shall apply to expenditures paid or incurred in taxable years
beginning after December 31, 2009.

SEC. 245. MINE RESCUE TEAM TRAINING CREDIT.

(a) In General.--Subsection (e) of section 45N is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Credit Allowable Against AMT.--Subparagraph (B) of
section 38(c)(4), as amended by section 104, is amended--
(1) by redesignating clauses (vii) through (x) as clauses
(viii) through (xi), respectively; and
(2) by inserting after clause (vi) the following new
clause:
``(vii) the credit determined under section 45N,''.
(c) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to taxable years
beginning after December 31, 2009.
(2) Allowance against amt.--The amendments made by
subsection (b) shall apply to credits determined for taxable
years beginning after December 31, 2009, and to carrybacks of
such credits.

SEC. 246. EMPLOYER WAGE CREDIT FOR EMPLOYEES WHO ARE ACTIVE
DUTY MEMBERS OF THE UNIFORMED SERVICES.

(a) In General.--Subsection (f) of section 45P is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to payments made after December 31, 2009.

SEC. 247. 5-YEAR DEPRECIATION FOR FARMING BUSINESS MACHINERY
AND EQUIPMENT.

(a) In General.--Clause (vii) of section 168(e)(3)(B) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after December 31,
2009.

SEC. 248. 15-YEAR STRAIGHT-LINE COST RECOVERY FOR QUALIFIED
LEASEHOLD IMPROVEMENTS, QUALIFIED RESTAURANT
BUILDINGS AND IMPROVEMENTS, AND QUALIFIED
RETAIL IMPROVEMENTS.

(a) In General.--Clauses (iv), (v), and (ix) of section
168(e)(3)(E) are each amended by striking ``January 1, 2010''
and inserting ``January 1, 2011''.
(b) Conforming Amendments.--
(1) Clause (i) of section 168(e)(7)(A) is amended by
striking ``if such building is placed in service after
December 31, 2008, and before January 1, 2010,''.

[[Page S5119]]

(2) Paragraph (8) of section 168(e) is amended by striking
subparagraph (E).
(c) Effective Date.--The amendments made by this section
shall apply to property placed in service after December 31,
2009.

SEC. 249. 7-YEAR RECOVERY PERIOD FOR MOTORSPORTS
ENTERTAINMENT COMPLEXES.

(a) In General.--Subparagraph (D) of section 168(i)(15) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after December 31,
2009.

SEC. 250. ACCELERATED DEPRECIATION FOR BUSINESS PROPERTY ON
AN INDIAN RESERVATION.

(a) In General.--Paragraph (8) of section 168(j) is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after December 31,
2009.

SEC. 251. ENHANCED CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF
FOOD INVENTORY.

(a) In General.--Clause (iv) of section 170(e)(3)(C) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to contributions made after December 31, 2009.

SEC. 252. ENHANCED CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF
BOOK INVENTORIES TO PUBLIC SCHOOLS.

(a) In General.--Clause (iv) of section 170(e)(3)(D) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to contributions made after December 31, 2009.

SEC. 253. ENHANCED CHARITABLE DEDUCTION FOR CORPORATE
CONTRIBUTIONS OF COMPUTER INVENTORY FOR
EDUCATIONAL PURPOSES.

(a) In General.--Subparagraph (G) of section 170(e)(6) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to contributions made in taxable years beginning
after December 31, 2009.

SEC. 254. ELECTION TO EXPENSE MINE SAFETY EQUIPMENT.

(a) In General.--Subsection (g) of section 179E is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after December 31,
2009.

SEC. 255. SPECIAL EXPENSING RULES FOR CERTAIN FILM AND
TELEVISION PRODUCTIONS.

(a) In General.--Subsection (f) of section 181 is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to productions commencing after December 31,
2009.

SEC. 256. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS.

(a) In General.--Subsection (h) of section 198 is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to expenditures paid or incurred after December
31, 2009.

SEC. 257. DEDUCTION ALLOWABLE WITH RESPECT TO INCOME
ATTRIBUTABLE TO DOMESTIC PRODUCTION ACTIVITIES
IN PUERTO RICO.

(a) In General.--Subparagraph (C) of section 199(d)(8) is
amended--
(1) by striking ``first 4 taxable years'' and inserting
``first 5 taxable years''; and
(2) by striking ``January 1, 2010'' and inserting ``January
1, 2011''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 258. MODIFICATION OF TAX TREATMENT OF CERTAIN PAYMENTS
TO CONTROLLING EXEMPT ORGANIZATIONS.

(a) In General.--Clause (iv) of section 512(b)(13)(E) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to payments received or accrued after December
31, 2009.

SEC. 259. EXCLUSION OF GAIN OR LOSS ON SALE OR EXCHANGE OF
CERTAIN BROWNFIELD SITES FROM UNRELATED
BUSINESS INCOME.

(a) In General.--Subparagraph (K) of section 512(b)(19) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to property acquired after December 31, 2009.

SEC. 260. TIMBER REIT MODERNIZATION.

(a) In General.--Paragraph (8) of section 856(c) is amended
by striking ``means'' and all that follows and inserting
``means December 31, 2010.''.
(b) Conforming Amendments.--
(1) Subparagraph (I) of section 856(c)(2) is amended by
striking ``the first taxable year beginning after the date of
the enactment of this subparagraph'' and inserting ``a
taxable year beginning on or before the termination date''.
(2) Clause (iii) of section 856(c)(5)(H) is amended by
inserting ``in taxable years beginning'' after
``dispositions''.
(3) Clause (v) of section 857(b)(6)(D) is amended by
inserting ``in a taxable year beginning'' after ``sale''.
(4) Subparagraph (G) of section 857(b)(6) is amended by
inserting ``in a taxable year beginning'' after ``In the case
of a sale''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years ending after May 22, 2009.

SEC. 261. TREATMENT OF CERTAIN DIVIDENDS OF REGULATED
INVESTMENT COMPANIES.

(a) In General.--Paragraphs (1)(C) and (2)(C) of section
871(k) are each amended by striking ``December 31, 2009'' and
inserting ``December 31, 2010''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 262. RIC QUALIFIED INVESTMENT ENTITY TREATMENT UNDER
FIRPTA.

(a) In General.--Clause (ii) of section 897(h)(4)(A) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--
(1) In general.--The amendment made by subsection (a) shall
take effect on January 1, 2010. Notwithstanding the preceding
sentence, such amendment shall not apply with respect to the
withholding requirement under section 1445 of the Internal
Revenue Code of 1986 for any payment made before the date of
the enactment of this Act.
(2) Amounts withheld on or before date of enactment.--In
the case of a regulated investment company--
(A) which makes a distribution after December 31, 2009, and
before the date of the enactment of this Act; and
(B) which would (but for the second sentence of paragraph
(1)) have been required to withhold with respect to such
distribution under section 1445 of such Code,
such investment company shall not be liable to any person to
whom such distribution was made for any amount so withheld
and paid over to the Secretary of the Treasury.

SEC. 263. EXCEPTIONS FOR ACTIVE FINANCING INCOME.

(a) In General.--Sections 953(e)(10) and 954(h)(9) are each
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Conforming Amendment.--Section 953(e)(10) is amended by
striking ``December 31, 2009'' and inserting ``December 31,
2010''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years of foreign corporations
beginning after December 31, 2009, and to taxable years of
United States shareholders with or within which any such
taxable year of such foreign corporation ends.

SEC. 264. LOOK-THRU TREATMENT OF PAYMENTS BETWEEN RELATED
CONTROLLED FOREIGN CORPORATIONS UNDER FOREIGN
PERSONAL HOLDING COMPANY RULES.

(a) In General.--Subparagraph (C) of section 954(c)(6) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years of foreign corporations
beginning after December 31, 2009, and to taxable years of
United States shareholders with or within which any such
taxable year of such foreign corporation ends.

SEC. 265. BASIS ADJUSTMENT TO STOCK OF S CORPS MAKING
CHARITABLE CONTRIBUTIONS OF PROPERTY.

(a) In General.--Paragraph (2) of section 1367(a) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to contributions made in taxable years beginning
after December 31, 2009.

SEC. 266. EMPOWERMENT ZONE TAX INCENTIVES.

(a) In General.--Section 1391 is amended--
(1) by striking ``December 31, 2009'' in subsection
(d)(1)(A)(i) and inserting ``December 31, 2010''; and
(2) by striking the last sentence of subsection (h)(2).
(b) Increased Exclusion of Gain on Stock of Empowerment
Zone Businesses.--Subparagraph (C) of section 1202(a)(2) is
amended--
(1) by striking ``December 31, 2014'' and inserting
``December 31, 2015''; and
(2) by striking ``2014'' in the heading and inserting
``2015''.
(c) Treatment of Certain Termination Dates Specified in
Nominations.--In the case of a designation of an empowerment
zone the nomination for which included a termination date
which is contemporaneous with the date specified in
subparagraph (A)(i) of section 1391(d)(1) of the Internal
Revenue Code of 1986 (as in effect before the enactment of
this Act), subparagraph (B) of such section shall not apply
with respect to such designation unless, after the date of
the enactment of this section, the entity which made such
nomination reconfirms such termination date, or amends the
nomination to provide for a new termination date, in such
manner as the Secretary of the Treasury (or the Secretary's
designee) may provide.
(d) Effective Date.--The amendments made by this section
shall apply to periods after December 31, 2009.

SEC. 267. RENEWAL COMMUNITY TAX INCENTIVES.

(a) In General.--Subsection (b) of section 1400E is
amended--
(1) by striking ``December 31, 2009'' in paragraphs (1)(A)
and (3) and inserting ``December 31, 2010''; and
(2) by striking ``January 1, 2010'' in paragraph (3) and
inserting ``January 1, 2011''.

[[Page S5120]]

(b) Zero-percent Capital Gains Rate.--
(1) Acquisition date.--Paragraphs (2)(A)(i), (3)(A),
(4)(A)(i), and (4)(B)(i) of section 1400F(b) are each amended
by striking ``January 1, 2010'' and inserting ``January 1,
2011''.
(2) Limitation on period of gains.--Paragraph (2) of
section 1400F(c) is amended--
(A) by striking ``December 31, 2014'' and inserting
``December 31, 2015''; and
(B) by striking ``2014'' in the heading and inserting
``2015''.
(3) Clerical amendment.--Subsection (d) of section 1400F is
amended by striking ``and `December 31, 2014' for `December
31, 2014' ''.
(c) Commercial Revitalization Deduction.--
(1) In general.--Subsection (g) of section 1400I is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(2) Conforming amendment.--Subparagraph (A) of section
1400I(d)(2) is amended by striking ``after 2001 and before
2010'' and inserting ``which begins after 2001 and before the
date referred to in subsection (g)''.
(d) Increased Expensing Under Section 179.--Subparagraph
(A) of section 1400J(b)(1) is amended by striking ``January
1, 2010'' and inserting ``January 1, 2011''.
(e) Treatment of Certain Termination Dates Specified in
Nominations.--In the case of a designation of a renewal
community the nomination for which included a termination
date which is contemporaneous with the date specified in
subparagraph (A) of section 1400E(b)(1) of the Internal
Revenue Code of 1986 (as in effect before the enactment of
this Act), subparagraph (B) of such section shall not apply
with respect to such designation unless, after the date of
the enactment of this section, the entity which made such
nomination reconfirms such termination date, or amends the
nomination to provide for a new termination date, in such
manner as the Secretary of the Treasury (or the Secretary's
designee) may provide.
(f) Effective Dates.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply
to periods after December 31, 2009.
(2) Acquisitions.--The amendments made by subsections
(b)(1) and (d) shall apply to acquisitions after December 31,
2009.
(3) Commercial revitalization deduction.--
(A) In general.--The amendment made by subsection (c)(1)
shall apply to buildings placed in service after December 31,
2009.
(B) Conforming amendment.--The amendment made by subsection
(c)(2) shall apply to calendar years beginning after December
31, 2009.

SEC. 268. TEMPORARY INCREASE IN LIMIT ON COVER OVER OF RUM
EXCISE TAXES TO PUERTO RICO AND THE VIRGIN
ISLANDS.

(a) In General.--Paragraph (1) of section 7652(f) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to distilled spirits brought into the United
States after December 31, 2009.

SEC. 269. PAYMENT TO AMERICAN SAMOA IN LIEU OF EXTENSION OF
ECONOMIC DEVELOPMENT CREDIT.

The Secretary of the Treasury (or his designee) shall pay
$18,000,000 to the Government of American Samoa for purposes
of economic development. The payment made under the preceding
sentence shall be treated for purposes of section 1324 of
title 31, United States Code, as a refund of internal revenue
collections to which such section applies.

SEC. 270. ELECTION TO TEMPORARILY UTILIZE UNUSED AMT CREDITS
DETERMINED BY DOMESTIC INVESTMENT.

(a) In General.--Section 53 is amended by adding at the end
the following new subsection:
``(g) Election for Corporations With New Domestic
Investments.--
``(1) In general.--If a corporation elects to have this
subsection apply for its first taxable year beginning after
December 31, 2009, the limitation imposed by subsection (c)
for such taxable year shall be increased by the AMT credit
adjustment amount.
``(2) AMT credit adjustment amount.--For purposes of
paragraph (1), the term `AMT credit adjustment amount' means,
the lesser of--
``(A) 50 percent of a corporation's minimum tax credit for
its first taxable year beginning after December 31, 2009,
determined under subsection (b), or
``(B) 10 percent of new domestic investments made during
such taxable year.
``(3) New domestic investments.--For purposes of this
subsection, the term `new domestic investments' means the
cost of qualified property (as defined in section
168(k)(2)(A)(i))--
``(A) the original use of which commences with the taxpayer
during the taxable year, and
``(B) which is placed in service in the United States by
the taxpayer during such taxable year.
``(4) Credit refundable.--For purposes of subsection (b) of
section 6401, the aggregate increase in the credits allowable
under this part for any taxable year resulting from the
application of this subsection shall be treated as allowed
under subpart C (and not under any other subpart). For
purposes of section 6425, any amount treated as so allowed
shall be treated as a payment of estimated income tax for the
taxable year.
``(5) Election.--An election under this subsection shall be
made at such time and in such manner as prescribed by the
Secretary, and once made, may be revoked only with the
consent of the Secretary. Not later than 90 days after the
date of the enactment of this subsection, the Secretary shall
issue guidance specifying such time and manner.
``(6) Treatment of certain partnership investments.--For
purposes of this subsection, a corporation shall take into
account its allocable share of any new domestic investments
by a partnership for any taxable year if, and only if, more
than 90 percent of the capital and profits interests in such
partnership are owned by such corporation (directly or
indirectly) at all times during such taxable year.
``(7) No double benefit.--
``(A) In general.--A corporation making an election under
this subsection may not make an election under subparagraph
(H) of section 172(b)(1).
``(B) Special rules with respect to taxpayers previously
electing applicable net operating losses.--In the case of a
corporation which made an election under subparagraph (H) of
section 172(b)(1) and elects the application of this
subsection--
``(i) Election of applicable net operating loss treated as
revoked.--The election under such subparagraph (H) shall
(notwithstanding clause (iii)(II) of such subparagraph) be
treated as having been revoked by the taxpayer.
``(ii) Coordination with provision for expedited refund.--
The amount otherwise treated as a payment of estimated income
tax under the last sentence of paragraph (4) shall be reduced
(but not below zero) by the aggregate increase in unpaid tax
liability determined under this chapter by reason of the
revocation of the election under clause (i).
``(iii) Application of statute of limitations.--With
respect to the revocation of an election under clause (i)--

``(I) the statutory period for the assessment of any
deficiency attributable to such revocation shall not expire
before the end of the 3-year period beginning on the date of
the election to have this subsection apply, and
``(II) such deficiency may be assessed before the
expiration of such 3-year period notwithstanding the
provisions of any other law or rule of law which would
otherwise prevent such assessment.

``(C) Exception for eligible small businesses.--
Subparagraphs (A) and (B) shall not apply to an eligible
small business as defined in section 172(b)(1)(H)(v)(II).
``(8) Regulations.--The Secretary may issue such
regulations or other guidance as may be necessary or
appropriate to carry out the purposes of this subsection,
including to prevent fraud and abuse under this
subsection.''.
(b) Conforming Amendments.--
(1) Section 6211(b)(4)(A) is amended by inserting
``53(g),'' after ``53(e),''.
(2) Section 1324(b)(2) of title 31, United States Code, is
amended by inserting ``53(g),'' after ``53(e),''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2009.

SEC. 271. REDUCTION IN CORPORATE RATE FOR QUALIFIED TIMBER
GAIN.

(a) In General.--Paragraph (1) of section 1201(b) is
amended by striking ``ending'' and all that follows through
``such date''.
(b) Conforming Amendment.--Paragraph (3) of section 1201(b)
is amended to read as follows:
``(3) Application of subsection.--The qualified timber gain
for any taxable year shall not exceed the qualified timber
gain which would be determined by not taking into account any
portion of such taxable year after December 31, 2010.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years ending after May 22, 2009.

SEC. 272. STUDY OF EXTENDED TAX EXPENDITURES.

(a) Findings.--Congress finds the following:
(1) Currently, the aggregate cost of Federal tax
expenditures rivals, or even exceeds, the amount of total
Federal discretionary spending.
(2) Given the escalating public debt, a critical
examination of this use of taxpayer dollars is essential.
(3) Additionally, tax expenditures can complicate the
Internal Revenue Code of 1986 for taxpayers and complicate
tax administration for the Internal Revenue Service.
(4) To facilitate a better understanding of tax
expenditures in the future, it is constructive for
legislation extending these provisions to include a study of
such provisions.
(b) Requirement to Report.--Not later than November 30,
2010, the Chief of Staff of the Joint Committee on Taxation,
in consultation with the Comptroller General of the United
States, shall submit to the Committee on Ways and Means of
the House of Representatives and the Committee on Finance of
the Senate a report on each tax expenditure (as defined in
section 3(3) of the Congressional Budget Impoundment Control
Act of 1974 (2 U.S.C. 622(3)) extended by this title.
(c) Rolling Submission of Reports.--The Chief of Staff of
the Joint Committee on Taxation shall initially submit the
reports for each such tax expenditure enacted in this
subtitle (relating to business tax relief) and subtitle A
(relating to energy) in order of the

[[Page S5121]]

tax expenditure incurring the least aggregate cost to the
greatest aggregate cost (determined by reference to the cost
estimate of this Act by the Joint Committee on Taxation).
Thereafter, such reports may be submitted in such order as
the Chief of Staff determines appropriate.
(d) Contents of Report.--Such reports shall contain the
following:
(1) An explanation of the tax expenditure and any relevant
economic, social, or other context under which it was first
enacted.
(2) A description of the intended purpose of the tax
expenditure.
(3) An analysis of the overall success of the tax
expenditure in achieving such purpose, and evidence
supporting such analysis.
(4) An analysis of the extent to which further extending
the tax expenditure, or making it permanent, would contribute
to achieving such purpose.
(5) A description of the direct and indirect beneficiaries
of the tax expenditure, including identifying any unintended
beneficiaries.
(6) An analysis of whether the tax expenditure is the most
cost-effective method for achieving the purpose for which it
was intended, and a description of any more cost-effective
methods through which such purpose could be accomplished.
(7) A description of any unintended effects of the tax
expenditure that are useful in understanding the tax
expenditure's overall value.
(8) An analysis of how the tax expenditure could be
modified to better achieve its original purpose.
(9) A brief description of any interactions (actual or
potential) with other tax expenditures or direct spending
programs in the same or related budget function worthy of
further study.
(10) A description of any unavailable information the staff
of the Joint Committee on Taxation may need to complete a
more thorough examination and analysis of the tax
expenditure, and what must be done to make such information
available.
(e) Minimum Analysis by Deadline.--In the event the Chief
of Staff of the Joint Committee on Taxation concludes it will
not be feasible to complete all reports by the date specified
in subsection (a), at a minimum, the reports for each tax
expenditure enacted in this subtitle (relating to business
tax relief) and subtitle A (relating to energy) shall be
completed by such date.

Subtitle D--Temporary Disaster Relief Provisions

PART I--NATIONAL DISASTER RELIEF

SEC. 281. WAIVER OF CERTAIN MORTGAGE REVENUE BOND
REQUIREMENTS.

(a) In General.--Paragraph (11) of section 143(k) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Special Rule for Residences Destroyed in Federally
Declared Disasters.--Paragraph (13) of section 143(k), as
redesignated by subsection (c), is amended by striking
``January 1, 2010'' in subparagraphs (A)(i) and (B)(i) and
inserting ``January 1, 2011''.
(c) Technical Amendment.--Subsection (k) of section 143 is
amended by redesignating the second paragraph (12) (relating
to special rules for residences destroyed in federally
declared disasters) as paragraph (13).
(d) Effective Dates.--
(1) In general.--Except as otherwise provided in this
subsection, the amendment made by this section shall apply to
bonds issued after December 31, 2009.
(2) Residences destroyed in federally declared disasters.--
The amendments made by subsection (b) shall apply with
respect to disasters occurring after December 31, 2009.
(3) Technical amendment.--The amendment made by subsection
(c) shall take effect as if included in section 709 of the
Tax Extenders and Alternative Minimum Tax Relief Act of 2008.

SEC. 282. LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED
DISASTERS.

(a) In General.--Subclause (I) of section 165(h)(3)(B)(i)
is amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) $500 Limitation.--Paragraph (1) of section 165(h) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(c) Effective Date.--
(1) In general.--The amendment made by subsection (a) shall
apply to federally declared disasters occurring after
December 31, 2009.
(2) $500 limitation.--The amendment made by subsection (b)
shall apply to taxable years beginning after December 31,
2009.

SEC. 283. SPECIAL DEPRECIATION ALLOWANCE FOR QUALIFIED
DISASTER PROPERTY.

(a) In General.--Subclause (I) of section 168(n)(2)(A)(ii)
is amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to disasters occurring after December 31, 2009.

SEC. 284. NET OPERATING LOSSES ATTRIBUTABLE TO FEDERALLY
DECLARED DISASTERS.

(a) In General.--Subclause (I) of section 172(j)(1)(A)(i)
is amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to losses attributable to disasters occurring
after December 31, 2009.

SEC. 285. EXPENSING OF QUALIFIED DISASTER EXPENSES.

(a) In General.--Subparagraph (A) of section 198A(b)(2) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to expenditures on account of disasters occurring
after December 31, 2009.

SEC. 286. SPECIAL DEPRECIATION ALLOWANCE.

(a) In General.--Paragraph (6) of section 1400N(d)(6) is
amended by striking subparagraph (D).
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after December 31,
2009.

PART II--REGIONAL PROVISIONS

Subpart A--New York Liberty Zone

SEC. 291. SPECIAL DEPRECIATION ALLOWANCE FOR NONRESIDENTIAL
AND RESIDENTIAL REAL PROPERTY.

(a) In General.--Subparagraph (A) of section 1400L(b)(2) is
amended by striking ``December 31, 2009'' and inserting
``December 31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to property placed in service after December 31,
2009.

SEC. 292. TAX-EXEMPT BOND FINANCING.

(a) In General.--Subparagraph (D) of section 1400L(d)(2) is
amended by striking ``January 1, 2010'' and inserting
``January 1, 2011''.
(b) Effective Date.--The amendment made by this section
shall apply to bonds issued after December 31, 2009.

Subpart B--GO Zone

SEC. 295. INCREASE IN REHABILITATION CREDIT.

(a) In General.--Subsection (h) of section 1400N is amended
by striking ``December 31, 2009'' and inserting ``December
31, 2010''.
(b) Effective Date.--The amendment made by this section
shall apply to amounts paid or incurred after December 31,
2009.

SEC. 296. WORK OPPORTUNITY TAX CREDIT WITH RESPECT TO CERTAIN
INDIVIDUALS AFFECTED BY HURRICANE KATRINA FOR
EMPLOYERS INSIDE DISASTER AREAS.

(a) In General.--Paragraph (1) of section 201(b) of the
Katrina Emergency Tax Relief Act of 2005 is amended by
striking ``4-year'' and inserting ``5-year''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to individuals hired after August 27, 2009.

SEC. 297. EXTENSION OF LOW-INCOME HOUSING CREDIT RULES FOR
BUILDINGS IN GO ZONES.

Section 1400N(c)(5) is amended by striking ``January 1,
2011'' and inserting ``January 1, 2013''.

SEC. 298. TAX-EXEMPT BOND FINANCING.

(a) In General.--Paragraphs (2)(D) and (7)(C) of section
1400N(a) are each amended by striking ``January 1, 2011'' and
inserting ``January 1, 2012''.
(b) Conforming Amendments.--Sections 702(d)(1) and 704(a)
of the Heartland Disaster Tax Relief Act of 2008 (Public Law
110-343; 122 Stat. 3913, 3919) are each amended by
striking``January 1, 2011'' each place it appears and
inserting ``January 1, 2012''.

Subpart C--Midwester Disaster Areas

SEC. 299. SPECIAL RULES FOR USE OF RETIREMENT FUNDS.

(a) In General.--Section 702(d)(10) of the Heartland
Disaster Tax Relief Act of 2008 (Public Law 110-343; 122
Stat. 3918) is amended--
(1) by striking ``January 1, 2010'' both places it appears
and inserting ``January 1, 2011'', and
(2) by striking ``December 31, 2009'' both places it
appears and inserting ``December 31, 2010''.
(b) Effective Date.--The amendments made by this section
shall take effect as if included in section 702(d)(10) of the
Heartland Disaster Tax Relief Act of 2008.

SEC. 300. EXCLUSION OF CANCELLATION OF MORTGAGE INDEBTEDNESS.

(a) In General.--Section 702(e)(4)(C) of the Heartland
Disaster Tax Relief Act of 2008 (Public Law 110-343; 122
Stat. 3918) is amended by striking ``January 1, 2010'' and
inserting ``January 1, 2011''.
(b) Effective Date.--The amendments made by this section
shall apply to discharges of indebtedness after December 31,
2009.

TITLE III--PENSION PROVISIONS

Subtitle A--Single Employer Plans

SEC. 301. EXTENDED PERIOD FOR SINGLE-EMPLOYER DEFINED BENEFIT
PLANS TO AMORTIZE CERTAIN SHORTFALL
AMORTIZATION BASES.

(a) Amendments to ERISA.--
(1) In general.--Paragraph (2) of section 303(c) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1083(c)) is amended by adding at the end the following
subparagraph:
``(D) Special election for eligible plan years.--
``(i) In general.--If a plan sponsor elects to apply this
subparagraph with respect to the shortfall amortization base
of a plan for any eligible plan year (in this subparagraph
and paragraph (7) referred to as an `election year'), then,
notwithstanding subparagraphs (A) and (B)--

``(I) the shortfall amortization installments with respect
to such base shall be determined under clause (ii) or (iii),
whichever is specified in the election, and
``(II) the shortfall amortization installment for any plan
year in the 9-plan-year period described in clause (ii) or
the 15-plan-

[[Page S5122]]

year period described in clause (iii), respectively, with
respect to such shortfall amortization base is the annual
installment determined under the applicable clause for that
year for that base.

``(ii) 2 plus 7 amortization schedule.--The shortfall
amortization installments determined under this clause are--

``(I) in the case of the first 2 plan years in the 9-plan-
year period beginning with the election year, interest on the
shortfall amortization base of the plan for the election year
(determined using the effective interest rate for the plan
for the election year), and
``(II) in the case of the last 7 plan years in such 9-plan-
year period, the amounts necessary to amortize the remaining
balance of the shortfall amortization base of the plan for
the election year in level annual installments over such last
7 plan years (using the segment rates under subparagraph (C)
for the election year).

``(iii) 15-year amortization.--The shortfall amortization
installments determined under this subparagraph are the
amounts necessary to amortize the shortfall amortization base
of the plan for the election year in level annual
installments over the 15-plan-year period beginning with the
election year (using the segment rates under subparagraph (C)
for the election year).
``(iv) Election.--

``(I) In general.--The plan sponsor of a plan may elect to
have this subparagraph apply to not more than 2 eligible plan
years with respect to the plan, except that in the case of a
plan described in section 106 of the Pension Protection Act
of 2006, the plan sponsor may only elect to have this
subparagraph apply to a plan year beginning in 2011.
``(II) Amortization schedule.--Such election shall specify
whether the amortization schedule under clause (ii) or (iii)
shall apply to an election year, except that if a plan
sponsor elects to have this subparagraph apply to 2 eligible
plan years, the plan sponsor must elect the same schedule for
both years.
``(III) Other rules.--Such election shall be made at such
time, and in such form and manner, as shall be prescribed by
the Secretary of the Treasury, and may be revoked only with
the consent of the Secretary of the Treasury. The Secretary
of the Treasury shall, before granting a revocation request,
provide the Pension Benefit Guaranty Corporation an
opportunity to comment on the conditions applicable to the
treatment of any portion of the election year shortfall
amortization base that remains unamortized as of the
revocation date.

``(v) Eligible plan year.--For purposes of this
subparagraph, the term `eligible plan year' means any plan
year beginning in 2008, 2009, 2010, or 2011, except that a
plan year shall only be treated as an eligible plan year if
the due date under subsection (j)(1) for the payment of the
minimum required contribution for such plan year occurs on or
after the date of the enactment of this subparagraph.
``(vi) Reporting.--A plan sponsor of a plan who makes an
election under clause (i) shall--

``(I) give notice of the election to participants and
beneficiaries of the plan, and
``(II) inform the Pension Benefit Guaranty Corporation of
such election in such form and manner as the Director of the
Pension Benefit Guaranty Corporation may prescribe.

``(vii) Increases in required installments in certain
cases.--For increases in required contributions in cases of
excess compensation or extraordinary dividends or stock
redemptions, see paragraph (7).''.
(2) Increases in required installments in certain cases.--
Section 303(c) of the Employee Retirement Income Security Act
of 1974 (29 U.S.C. 1083(c)) is amended by adding at the end
the following paragraph:
``(7) Increases in alternate required installments in cases
of excess compensation or extraordinary dividends or stock
redemptions.--
``(A) In general.--If there is an installment acceleration
amount with respect to a plan for any plan year in the
restriction period with respect to an election year under
paragraph (2)(D), then the shortfall amortization installment
otherwise determined and payable under such paragraph for
such plan year shall, subject to the limitation under
subparagraph (B), be increased by such amount.
``(B) Total installments limited to shortfall base.--
Subject to rules prescribed by the Secretary of the Treasury,
if a shortfall amortization installment with respect to any
shortfall amortization base for an election year is required
to be increased for any plan year under subparagraph (A)--
``(i) such increase shall not result in the amount of such
installment exceeding the present value of such installment
and all succeeding installments with respect to such base
(determined without regard to such increase but after
application of clause (ii)), and
``(ii) subsequent shortfall amortization installments with
respect to such base shall, in reverse order of the otherwise
required installments, be reduced to the extent necessary to
limit the present value of such subsequent shortfall
amortization installments (after application of this
paragraph) to the present value of the remaining unamortized
shortfall amortization base.
``(C) Installment acceleration amount.--For purposes of
this paragraph--
``(i) In general.--The term `installment acceleration
amount' means, with respect to any plan year in a restriction
period with respect to an election year, the sum of--

``(I) the aggregate amount of excess employee compensation
determined under subparagraph (D) with respect to all
employees for the plan year, plus
``(II) the aggregate amount of extraordinary dividends and
redemptions determined under subparagraph (E) for the plan
year.

``(ii) Annual limitation.--The installment acceleration
amount for any plan year shall not exceed the excess (if any)
of--

``(I) the sum of the shortfall amortization installments
for the plan year and all preceding plan years in the
amortization period elected under paragraph (2)(D) with
respect to the shortfall amortization base with respect to an
election year, determined without regard to paragraph (2)(D)
and this paragraph, over
``(II) the sum of the shortfall amortization installments
for such plan year and all such preceding plan years,
determined after application of paragraph (2)(D) (and in the
case of any preceding plan year, after application of this
paragraph).

``(iii) Carryover of excess installment acceleration
amounts.--

``(I) In general.--If the installment acceleration amount
for any plan year (determined without regard to clause (ii))
exceeds the limitation under clause (ii), then, subject to
subclause (II), such excess shall be treated as an
installment acceleration amount with respect to the
succeeding plan year.
``(II) Cap to apply.--If any amount treated as an
installment acceleration amount under subclause (I) or this
subclause with respect any succeeding plan year, when added
to other installment acceleration amounts (determined without
regard to clause (ii)) with respect to the plan year, exceeds
the limitation under clause (ii), the portion of such amount
representing such excess shall be treated as an installment
acceleration amount with respect to the next succeeding plan
year.
``(III) Limitation on years to which amounts carried for.--
No amount shall be carried under subclause (I) or (II) to a
plan year which begins after the first plan year following
the last plan year in the restriction period (or after the
second plan year following such last plan year in the case of
an election year with respect to which 15-year amortization
was elected under paragraph (2)(D)).
``(IV) Ordering rules.--For purposes of applying subclause
(II), installment acceleration amounts for the plan year
(determined without regard to any carryover under this
clause) shall be applied first against the limitation under
clause (ii) and then carryovers to such plan year shall be
applied against such limitation on a first-in, first-out
basis.

``(D) Excess employee compensation.--For purposes of this
paragraph--
``(i) In general.--The term `excess employee compensation'
means, with respect to any employee for any plan year, the
excess (if any) of--

``(I) the aggregate amount includible in income under
chapter 1 of the Internal Revenue Code of 1986 for
remuneration during the calendar year in which such plan year
begins for services performed by the employee for the plan
sponsor (whether or not performed during such calendar year),
over
``(II) $1,000,000.

``(ii) Amounts set aside for nonqualified deferred
compensation.--If during any calendar year assets are set
aside or reserved (directly or indirectly) in a trust (or
other arrangement as determined by the Secretary of the
Treasury), or transferred to such a trust or other
arrangement, by a plan sponsor for purposes of paying
deferred compensation of an employee under a nonqualified
deferred compensation plan (as defined in section 409A of
such Code) of the plan sponsor, then, for purposes of clause
(i), the amount of such assets shall be treated as
remuneration of the employee includible in income for the
calendar year unless such amount is otherwise includible in
income for such year. An amount to which the preceding
sentence applies shall not be taken into account under this
paragraph for any subsequent calendar year.
``(iii) Only remuneration for certain post-2009 services
counted.--Remuneration shall be taken into account under
clause (i) only to the extent attributable to services
performed by the employee for the plan sponsor after February
28, 2010.
``(iv) Exception for certain equity payments.--

``(I) In general.--There shall not be taken into account
under clause (i)(I) any amount includible in income with
respect to the granting after February 28, 2010, of service
recipient stock (within the meaning of section 409A of the
Internal Revenue Code of 1986) that, upon such grant, is
subject to a substantial risk of forfeiture (as defined under
section 83(c)(1) of such Code) for at least 5 years from the
date of such grant.
``(II) Secretarial authority.--The Secretary of the
Treasury may by regulation provide for the application of
this clause in the case of a person other than a corporation.

``(v) Other exceptions.--The following amounts includible
in income shall not be taken into account under clause
(i)(I):

``(I) Commissions.--Any remuneration payable on a
commission basis solely on account of income directly
generated by the individual performance of the individual to
whom such remuneration is payable.
``(II) Certain payments under existing contracts.--Any
remuneration consisting of

[[Page S5123]]

nonqualified deferred compensation, restricted stock, stock
options, or stock appreciation rights payable or granted
under a written binding contract that was in effect on March
1, 2010, and which was not modified in any material respect
before such remuneration is paid.

``(vi) Self-employed individual treated as employee.--The
term `employee' includes, with respect to a calendar year, a
self-employed individual who is treated as an employee under
section 401(c) of such Code for the taxable year ending
during such calendar year, and the term `compensation' shall
include earned income of such individual with respect to such
self-employment.
``(vii) Indexing of amount.--In the case of any calendar
year beginning after 2010, the dollar amount under clause
(i)(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) of such Code for the calendar year,
determined by substituting `calendar year 2009' for `calendar
year 1992' in subparagraph (B) thereof.

If the amount of any increase under clause (i) is not a
multiple of $1,000, such increase shall be rounded to the
next lowest multiple of $1,000.
``(E) Extraordinary dividends and redemptions.--
``(i) In general.--The amount determined under this
subparagraph for any plan year is the excess (if any) of the
sum of the dividends declared during the plan year by the
plan sponsor plus the aggregate amount paid for the
redemption of stock of the plan sponsor redeemed during the
plan year over the greater of--

``(I) the adjusted net income (within the meaning of
section 4043) of the plan sponsor for the preceding plan
year, determined without regard to any reduction by reason of
interest, taxes, depreciation, or amortization, or
``(II) in the case of a plan sponsor that determined and
declared dividends in the same manner for at least 5
consecutive years immediately preceding such plan year, the
aggregate amount of dividends determined and declared for
such plan year using such manner.

``(ii) Only certain post-2009 dividends and redemptions
counted.--For purposes of clause (i), there shall only be
taken into account dividends declared, and redemptions
occurring, after February 28, 2010.
``(iii) Exception for intra-group dividends.--Dividends
paid by one member of a controlled group (as defined in
section 302(d)(3)) to another member of such group shall not
be taken into account under clause (i).
``(iv) Exception for certain redemptions.--Redemptions that
are made pursuant to a plan maintained with respect to
employees, or that are made on account of the death,
disability, or termination of employment of an employee or
shareholder, shall not be taken into account under clause
(i).
``(v) Exception for certain preferred stock.--

``(I) In general.--Dividends and redemptions with respect
to applicable preferred stock shall not be taken into account
under clause (i) to the extent that dividends accrue with
respect to such stock at a specified rate in all events and
without regard to the plan sponsor's income, and interest
accrues on any unpaid dividends with respect to such stock.
``(II) Applicable preferred stock.--For purposes of
subclause (I), the term `applicable preferred stock' means
preferred stock which was issued before March 1, 2010 (or
which was issued after such date and is held by an employee
benefit plan subject to the provisions of this title).

``(F) Other definitions and rules.--For purposes of this
paragraph--
``(i) Plan sponsor.--The term ` plan sponsor' includes any
member of the plan sponsor's controlled group (as defined in
section 302(d)(3)).
``(ii) Restriction period.--The term `restriction period'
means, with respect to any election year--

``(I) except as provided in subclause (II), the 3-year
period beginning with the election year (or, if later, the
first plan year beginning after December 31, 2009), and
``(II) if the plan sponsor elects 15-year amortization for
the shortfall amortization base for the election year, the 5-
year period beginning with the election year (or, if later,
the first plan year beginning after December 31, 2009).

``(iii) Elections for multiple plans.--If a plan sponsor
makes elections under paragraph (2)(D) with respect to 2 or
more plans, the Secretary of the Treasury shall provide rules
for the application of this paragraph to such plans,
including rules for the ratable allocation of any installment
acceleration amount among such plans on the basis of each
plan's relative reduction in the plan's shortfall
amortization installment for the first plan year in the
amortization period described in subparagraph (A) (determined
without regard to this paragraph).
``(iv) Mergers and acquisitions.--The Secretary of the
Treasury shall prescribe rules for the application of
paragraph (2)(D) and this paragraph in any case where there
is a merger or acquisition involving a plan sponsor making
the election under paragraph (2)(D).''.
(3) Conforming amendments.--Section 303 of such Act (29
U.S.C. 1083) is amended--
(A) in subsection (c)(1), by striking ``the shortfall
amortization bases for such plan year and each of the 6
preceding plan years'' and inserting ``any shortfall
amortization base which has not been fully amortized under
this subsection'', and
(B) in subsection (j)(3), by adding at the end the
following:
``(F) Quarterly contributions not to include certain
increased contributions.--Subparagraph (D) shall be applied
without regard to any increase under subsection (c)(7).''.
(b) Amendments to Internal Revenue Code of 1986.--
(1) In general.--Paragraph (2) of section 430(c) is amended
by adding at the end the following subparagraph:
``(D) Special election for eligible plan years.--
``(i) In general.--If a plan sponsor elects to apply this
subparagraph with respect to the shortfall amortization base
of a plan for any eligible plan year (in this subparagraph
and paragraph (7) referred to as an `election year'), then,
notwithstanding subparagraphs (A) and (B)--

``(I) the shortfall amortization installments with respect
to such base shall be determined under clause (ii) or (iii),
whichever is specified in the election, and
``(II) the shortfall amortization installment for any plan
year in the 9-plan-year period described in clause (ii) or
the 15-plan-year period described in clause (iii),
respectively, with respect to such shortfall amortization
base is the annual installment determined under the
applicable clause for that year for that base.

``(ii) 2 plus 7 amortization schedule.--The shortfall
amortization installments determined under this clause are--

``(I) in the case of the first 2 plan years in the 9-plan-
year period beginning with the election year, interest on the
shortfall amortization base of the plan for the election year
(determined using the effective interest rate for the plan
for the election year), and
``(II) in the case of the last 7 plan years in such 9-plan-
year period, the amounts necessary to amortize the remaining
balance of the shortfall amortization base of the plan for
the election year in level annual installments over such last
7 plan years (using the segment rates under subparagraph (C)
for the election year).

``(iii) 15-year amortization.--The shortfall amortization
installments determined under this subparagraph are the
amounts necessary to amortize the shortfall amortization base
of the plan for the election year in level annual
installments over the 15-plan-year period beginning with the
election year (using the segment rates under subparagraph (C)
for the election year).
``(iv) Election.--

``(I) In general.--The plan sponsor of a plan may elect to
have this subparagraph apply to not more than 2 eligible plan
years with respect to the plan, except that in the case of a
plan described in section 106 of the Pension Protection Act
of 2006, the plan sponsor may only elect to have this
subparagraph apply to a plan year beginning in 2011.
``(II) Amortization schedule.--Such election shall specify
whether the amortization schedule under clause (ii) or (iii)
shall apply to an election year, except that if a plan
sponsor elects to have this subparagraph apply to 2 eligible
plan years, the plan sponsor must elect the same schedule for
both years.
``(III) Other rules.--Such election shall be made at such
time, and in such form and manner, as shall be prescribed by
the Secretary, and may be revoked only with the consent of
the Secretary. The Secretary shall, before granting a
revocation request, provide the Pension Benefit Guaranty
Corporation an opportunity to comment on the conditions
applicable to the treatment of any portion of the election
year shortfall amortization base that remains unamortized as
of the revocation date.

``(v) Eligible plan year.--For purposes of this
subparagraph, the term `eligible plan year' means any plan
year beginning in 2008, 2009, 2010, or 2011, except that a
plan year shall only be treated as an eligible plan year if
the due date under subsection (j)(1) for the payment of the
minimum required contribution for such plan year occurs on or
after the date of the enactment of this subparagraph.
``(vi) Reporting.--A plan sponsor of a plan who makes an
election under clause (i) shall--

``(I) give notice of the election to participants and
beneficiaries of the plan, and
``(II) inform the Pension Benefit Guaranty Corporation of
such election in such form and manner as the Director of the
Pension Benefit Guaranty Corporation may prescribe.

``(vii) Increases in required installments in certain
cases.--For increases in required contributions in cases of
excess compensation or extraordinary dividends or stock
redemptions, see paragraph (7).''.
(2) Increases in required contributions if excess
compensation paid.--Section 430(c) is amended by adding at
the end the following paragraph:
``(7) Increases in alternate required installments in cases
of excess compensation or extraordinary dividends or stock
redemptions.--
``(A) In general.--If there is an installment acceleration
amount with respect to a plan for any plan year in the
restriction period with respect to an election year under
paragraph (2)(D), then the shortfall amortization installment
otherwise determined and payable under such paragraph for
such plan

[[Page S5124]]

year shall, subject to the limitation under subparagraph (B),
be increased by such amount.
``(B) Total installments limited to shortfall base.--
Subject to rules prescribed by the Secretary, if a shortfall
amortization installment with respect to any shortfall
amortization base for an election year is required to be
increased for any plan year under subparagraph (A)--
``(i) such increase shall not result in the amount of such
installment exceeding the present value of such installment
and all succeeding installments with respect to such base
(determined without regard to such increase but after
application of clause (ii)), and
``(ii) subsequent shortfall amortization installments with
respect to such base shall, in reverse order of the otherwise
required installments, be reduced to the extent necessary to
limit the present value of such subsequent shortfall
amortization installments (after application of this
paragraph) to the present value of the remaining unamortized
shortfall amortization base.
``(C) Installment acceleration amount.--For purposes of
this paragraph--
``(i) In general.--The term `installment acceleration
amount' means, with respect to any plan year in a restriction
period with respect to an election year, the sum of--

``(I) the aggregate amount of excess employee compensation
determined under subparagraph (D) with respect to all
employees for the plan year, plus
``(II) the aggregate amount of extraordinary dividends and
redemptions determined under subparagraph (E) for the plan
year.

``(ii) Annual limitation.--The installment acceleration
amount for any plan year shall not exceed the excess (if any)
of--

``(I) the sum of the shortfall amortization installments
for the plan year and all preceding plan years in the
amortization period elected under paragraph (2)(D) with
respect to the shortfall amortization base with respect to an
election year, determined without regard to paragraph (2)(D)
and this paragraph, over
``(II) the sum of the shortfall amortization installments
for such plan year and all such preceding plan years,
determined after application of paragraph (2)(D) (and in the
case of any preceding plan year, after application of this
paragraph).

``(iii) Carryover of excess installment acceleration
amounts.--

``(I) In general.--If the installment acceleration amount
for any plan year (determined without regard to clause (ii))
exceeds the limitation under clause (ii), then, subject to
subclause (II), such excess shall be treated as an
installment acceleration amount with respect to the
succeeding plan year.
``(II) Cap to apply.--If any amount treated as an
installment acceleration amount under subclause (I) or this
subclause with respect any succeeding plan year, when added
to other installment acceleration amounts (determined without
regard to clause (ii)) with respect to the plan year, exceeds
the limitation under clause (ii), the portion of such amount
representing such excess shall be treated as an installment
acceleration amount with respect to the next succeeding plan
year.
``(III) Limitation on years to which amounts carried for.--
No amount shall be carried under subclause (I) or (II) to a
plan year which begins after the first plan year following
the last plan year in the restriction period (or after the
second plan year following such last plan year in the case of
an election year with respect to which 15-year amortization
was elected under paragraph (2)(D)).
``(IV) Ordering rules.--For purposes of applying subclause
(II), installment acceleration amounts for the plan year
(determined without regard to any carryover under this
clause) shall be applied first against the limitation under
clause (ii) and then carryovers to such plan year shall be
applied against such limitation on a first-in, first-out
basis.

``(D) Excess employee compensation.--For purposes of this
paragraph--
``(i) In general.--The term `excess employee compensation'
means, with respect to any employee for any plan year, the
excess (if any) of--

``(I) the aggregate amount includible in income under this
chapter for remuneration during the calendar year in which
such plan year begins for services performed by the employee
for the plan sponsor (whether or not performed during such
calendar year), over
``(II) $1,000,000.

``(ii) Amounts set aside for nonqualified deferred
compensation.--If during any calendar year assets are set
aside or reserved (directly or indirectly) in a trust (or
other arrangement as determined by the Secretary), or
transferred to such a trust or other arrangement, by a plan
sponsor for purposes of paying deferred compensation of an
employee under a nonqualified deferred compensation plan (as
defined in section 409A) of the plan sponsor, then, for
purposes of clause (i), the amount of such assets shall be
treated as remuneration of the employee includible in income
for the calendar year unless such amount is otherwise
includible in income for such year. An amount to which the
preceding sentence applies shall not be taken into account
under this paragraph for any subsequent calendar year.
``(iii) Only remuneration for certain post-2009 services
counted.--Remuneration shall be taken into account under
clause (i) only to the extent attributable to services
performed by the employee for the plan sponsor after February
28, 2010.
``(iv) Exception for certain equity payments.--

``(I) In general.--There shall not be taken into account
under clause (i)(I) any amount includible in income with
respect to the granting after February 28, 2010, of service
recipient stock (within the meaning of section 409A) that,
upon such grant, is subject to a substantial risk of
forfeiture (as defined under section 83(c)(1)) for at least 5
years from the date of such grant.
``(II) Secretarial authority.--The Secretary may by
regulation provide for the application of this clause in the
case of a person other than a corporation.

``(v) Other exceptions.--The following amounts includible
in income shall not be taken into account under clause
(i)(I):

``(I) Commissions.--Any remuneration payable on a
commission basis solely on account of income directly
generated by the individual performance of the individual to
whom such remuneration is payable.
``(II) Certain payments under existing contracts.--Any
remuneration consisting of nonqualified deferred
compensation, restricted stock, stock options, or stock
appreciation rights payable or granted under a written
binding contract that was in effect on March 1, 2010, and
which was not modified in any material respect before such
remuneration is paid.

``(vi) Self-employed individual treated as employee.--The
term `employee' includes, with respect to a calendar year, a
self-employed individual who is treated as an employee under
section 401(c) for the taxable year ending during such
calendar year, and the term `compensation' shall include
earned income of such individual with respect to such self-
employment.
``(vii) Indexing of amount.--In the case of any calendar
year beginning after 2010, the dollar amount under clause
(i)(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 2009' for `calendar year 1992' in
subparagraph (B) thereof.

If the amount of any increase under clause (i) is not a
multiple of $1,000, such increase shall be rounded to the
next lowest multiple of $1,000.
``(E) Extraordinary dividends and redemptions.--
``(i) In general.--The amount determined under this
subparagraph for any plan year is the excess (if any) of the
sum of the dividends declared during the plan year by the
plan sponsor plus the aggregate amount paid for the
redemption of stock of the plan sponsor redeemed during the
plan year over the greater of--

``(I) the adjusted net income (within the meaning of
section 4043 of the Employee Retirement Income Security Act
of 1974) of the plan sponsor for the preceding plan year,
determined without regard to any reduction by reason of
interest, taxes, depreciation, or amortization, or
``(II) in the case of a plan sponsor that determined and
declared dividends in the same manner for at least 5
consecutive years immediately preceding such plan year, the
aggregate amount of dividends determined and declared for
such plan year using such manner.

``(ii) Only certain post-2009 dividends and redemptions
counted.--For purposes of clause (i), there shall only be
taken into account dividends declared, and redemptions
occurring, after February 28, 2010.
``(iii) Exception for intra-group dividends.--Dividends
paid by one member of a controlled group (as defined in
section 412(d)(3)) to another member of such group shall not
be taken into account under clause (i).
``(iv) Exception for certain redemptions.--Redemptions that
are made pursuant to a plan maintained with respect to
employees, or that are made on account of the death,
disability, or termination of employment of an employee or
shareholder, shall not be taken into account under clause
(i).
``(v) Exception for certain preferred stock.--

``(I) In general.--Dividends and redemptions with respect
to applicable preferred stock shall not be taken into account
under clause (i) to the extent that dividends accrue with
respect to such stock at a specified rate in all events and
without regard to the plan sponsor's income, and interest
accrues on any unpaid dividends with respect to such stock.
``(II) Applicable preferred stock.--For purposes of
subclause (I), the term `applicable preferred stock' means
preferred stock which was issued before March 1, 2010 (or
which was issued after such date and is held by an employee
benefit plan subject to the provisions of title I of Employee
Retirement Income Security Act of 1974).

``(F) Other definitions and rules.--For purposes of this
paragraph--
``(i) Plan sponsor.--The term ` plan sponsor' includes any
member of the plan sponsor's controlled group (as defined in
section 412(d)(3)).
``(ii) Restriction period.--The term `restriction period'
means, with respect to any election year--

``(I) except as provided in subclause (II), the 3-year
period beginning with the election year (or, if later, the
first plan year beginning after December 31, 2009), and

[[Page S5125]]

``(II) if the plan sponsor elects 15-year amortization for
the shortfall amortization base for the election year, the 5-
year period beginning with the election year (or, if later,
the first plan year beginning after December 31, 2009).

``(iii) Elections for multiple plans.--If a plan sponsor
makes elections under paragraph (2)(D) with respect to 2 or
more plans, the Secretary shall provide rules for the
application of this paragraph to such plans, including rules
for the ratable allocation of any installment acceleration
amount among such plans on the basis of each plan's relative
reduction in the plan's shortfall amortization installment
for the first plan year in the amortization period described
in subparagraph (A) (determined without regard to this
paragraph).
``(iv) Mergers and acquisitions.--The Secretary shall
prescribe rules for the application of paragraph (2)(D) and
this paragraph in any case where there is a merger or
acquisition involving a plan sponsor making the election
under paragraph (2)(D).''.
(3) Conforming amendments.--Section 430 is amended--
(A) in subsection (c)(1), by striking ``the shortfall
amortization bases for such plan year and each of the 6
preceding plan years'' and inserting ``any shortfall
amortization base which has not been fully amortized under
this subsection'', and
(B) in subsection (j)(3), by adding at the end the
following:
``(F) Quarterly contributions not to include certain
increased contributions.--Subparagraph (D) shall be applied
without regard to any increase under subsection (c)(7).''.
(c) Effective Date.--The amendments made by this section
shall apply to plan years beginning after December 31, 2007.

SEC. 302. APPLICATION OF EXTENDED AMORTIZATION PERIOD TO
PLANS SUBJECT TO PRIOR LAW FUNDING RULES.

(a) In General.--Title I of the Pension Protection Act of
2006 is amended by redesignating section 107 as section 108
and by inserting the following after section 106:

``SEC. 107. APPLICATION OF EXTENDED AMORTIZATION PERIODS TO
PLANS WITH DELAYED EFFECTIVE DATE.

``(a) In General.--If the plan sponsor of a plan to which
section 104, 105, or 106 of this Act applies elects to have
this section apply for any eligible plan year (in this
section referred to as an `election year'), section 302 of
the Employee Retirement Income Security Act of 1974 and
section 412 of the Internal Revenue Code of 1986 (as in
effect before the amendments made by this subtitle and
subtitle B) shall apply to such year in the manner described
in subsection (b) or (c), whichever is specified in the
election. All references in this section to `such Act' or
`such Code' shall be to such Act or such Code as in effect
before the amendments made by this subtitle and subtitle B.
``(b) Application of 2 and 7 Rule.--In the case of an
election year to which this subsection applies--
``(1) 2-year lookback for determining deficit reduction
contributions for certain plans.--For purposes of applying
section 302(d)(9) of such Act and section 412(l)(9) of such
Code, the funded current liability percentage (as defined in
subparagraph (C) thereof) for such plan for such plan year
shall be such funded current liability percentage of such
plan for the second plan year preceding the first election
year of such plan.
``(2) Calculation of deficit reduction contribution.--For
purposes of applying section 302(d) of such Act and section
412(l) of such Code to a plan to which such sections apply
(after taking into account paragraph (1))--
``(A) in the case of the increased unfunded new liability
of the plan, the applicable percentage described in section
302(d)(4)(C) of such Act and section 412(l)(4)(C) of such
Code shall be the third segment rate described in sections
104(b), 105(b), and 106(b) of this Act, and
``(B) in the case of the excess of the unfunded new
liability over the increased unfunded new liability, such
applicable percentage shall be determined without regard to
this section.
``(c) Application of 15-year Amortization.--In the case of
an election year to which this subsection applies, for
purposes of applying section 302(d) of such Act and section
412(l) of such Code--
``(1) in the case of the increased unfunded new liability
of the plan, the applicable percentage described in section
302(d)(4)(C) of such Act and section 412(l)(4)(C) of such
Code for any pre-effective date plan year beginning with or
after the first election year shall be the ratio of--
``(A) the annual installments payable in each year if the
increased unfunded new liability for such plan year were
amortized over 15 years, using an interest rate equal to the
third segment rate described in sections 104(b), 105(b), and
106(b) of this Act, to
``(B) the increased unfunded new liability for such plan
year, and
``(2) in the case of the excess of the unfunded new
liability over the increased unfunded new liability, such
applicable percentage shall be determined without regard to
this section.
``(d) Election.--
``(1) In general.--The plan sponsor of a plan may elect to
have this section apply to not more than 2 eligible plan
years with respect to the plan, except that in the case of a
plan to which section 106 of this Act applies, the plan
sponsor may only elect to have this section apply to 1
eligible plan year.
``(2) Amortization schedule.--Such election shall specify
whether the rules under subsection (b) or (c) shall apply to
an election year, except that if a plan sponsor elects to
have this section apply to 2 eligible plan years, the plan
sponsor must elect the same rule for both years.
``(3) Other rules.--Such election shall be made at such
time, and in such form and manner, as shall be prescribed by
the Secretary of the Treasury, and may be revoked only with
the consent of the Secretary of the Treasury.
``(e) Definitions.--For purposes of this section--
``(1) Eligible plan year.--For purposes of this
subparagraph, the term `eligible plan year' means any plan
year beginning in 2008, 2009, 2010, or 2011, except that a
plan year beginning in 2008 shall only be treated as an
eligible plan year if the due date for the payment of the
minimum required contribution for such plan year occurs on or
after the date of the enactment of this clause.
``(2) Pre-effective date plan year.--The term `pre-
effective date plan year' means, with respect to a plan, any
plan year prior to the first year in which the amendments
made by this subtitle and subtitle B apply to the plan.
``(3) Increased unfunded new liability.--The term
`increased unfunded new liability' means, with respect to a
year, the excess (if any) of the unfunded new liability over
the amount of unfunded new liability determined as if the
value of the plan's assets determined under subsection
302(c)(2) of such Act and section 412(c)(2) of such Code
equaled the product of the current liability of the plan for
the year multiplied by the funded current liability
percentage (as defined in section 302(d)(8)(B) of such Act
and 412(l)(8)(B) of such Code) of the plan for the second
plan year preceding the first election year of such plan.
``(4) Other definitions.--The terms `unfunded new
liability' and `current liability' shall have the meanings
set forth in section 302(d) of such Act and section 412(l) of
such Code.''.
(b) Eligible Charity Plans.--Section 104 of the Pension
Protection Act of 2006 is amended--
(1) by striking ``eligible cooperative plan'' wherever it
appears in subsections (a) and (b) and inserting ``eligible
cooperative plan or an eligible charity plan'', and
(2) by adding at the end the following new subsection:
``(d) Eligible Charity Plan Defined.--For purposes of this
section, a plan shall be treated as an eligible charity plan
for a plan year if the plan is maintained by more than one
employer (determined without regard to section 414(c) of the
Internal Revenue Code) and 100 percent of the employers are
described in section 501(c)(3) of such Code.''.
(c) Effective Date.--
(1) In general.--The amendment made by subsection (a) shall
take effect as if included in the Pension Protection Act of
2006.
(2) Eligible charity plan.--The amendments made by
subsection (b) shall apply to plan years beginning after
December 31, 2007, except that a plan sponsor may elect to
apply such amendments to plan years beginning after December
31, 2008. Any such election shall be made at such time, and
in such form and manner, as shall be prescribed by the
Secretary of the Treasury, and may be revoked only with the
consent of the Secretary of the Treasury.

SEC. 303. LOOKBACK FOR CERTAIN BENEFIT RESTRICTIONS.

(a) In General.--
(1) Amendment to erisa.--Section 206(g)(9) of the Employee
Retirement Income Security Act of 1974 is amended by adding
at the end the following:
``(D) Special rule for certain years.--Solely for purposes
of any applicable provision--
``(i) In general.--For plan years beginning on or after
October 1, 2008, and before October 1, 2010, the adjusted
funding target attainment percentage of a plan shall be the
greater of--

``(I) such percentage, as determined without regard to this
subparagraph, or
``(II) the adjusted funding target attainment percentage
for such plan for the plan year beginning after October 1,
2007, and before October 1, 2008, as determined under rules
prescribed by the Secretary of the Treasury.

``(ii) Special rule.--In the case of a plan for which the
valuation date is not the first day of the plan year--

``(I) clause (i) shall apply to plan years beginning after
December 31, 2007, and before January 1, 2010, and
``(II) clause (i)(II) shall apply based on the last plan
year beginning before November 1, 2007, as determined under
rules prescribed by the Secretary of the Treasury.

``(iii) Applicable provision.--For purposes of this
subparagraph, the term `applicable provision' means--

``(I) paragraph (3), but only for purposes of applying such
paragraph to a payment which, as determined under rules
prescribed by the Secretary of the Treasury, is a payment
under a social security leveling option which accelerates
payments under the plan before, and reduces payments after, a
participant starts receiving social security benefits in
order to provide substantially similar aggregate payments
both before and after such benefits are received, and
``(II) paragraph (4).''.

[[Page S5126]]

(2) Amendment to internal revenue code of 1986.--Section
436(j) of the Internal Revenue Code of 1986 is amended by
adding at the end the following:
``(3) Special rule for certain years.--Solely for purposes
of any applicable provision--
``(A) In general.--For plan years beginning on or after
October 1, 2008, and before October 1, 2010, the adjusted
funding target attainment percentage of a plan shall be the
greater of--
``(i) such percentage, as determined without regard to this
paragraph, or
``(ii) the adjusted funding target attainment percentage
for such plan for the plan year beginning after October 1,
2007, and before October 1, 2008, as determined under rules
prescribed by the Secretary.
``(B) Special rule.--In the case of a plan for which the
valuation date is not the first day of the plan year--
``(i) subparagraph (A) shall apply to plan years beginning
after December 31, 2007, and before January 1, 2010, and
``(ii) subparagraph (A)(ii) shall apply based on the last
plan year beginning before November 1, 2007, as determined
under rules prescribed by the Secretary.
``(C) Applicable provision.--For purposes of this
paragraph, the term `applicable provision' means--
``(i) subsection (d), but only for purposes of applying
such paragraph to a payment which, as determined under rules
prescribed by the Secretary, is a payment under a social
security leveling option which accelerates payments under the
plan before, and reduces payments after, a participant starts
receiving social security benefits in order to provide
substantially similar aggregate payments both before and
after such benefits are received, and
``(ii) subsection (e).''.
(b) Interaction With Wrera Rule.--Section 203 of the
Worker, Retiree, and Employer Recovery Act of 2008 shall
apply to a plan for any plan year in lieu of the amendments
made by this section applying to sections 206(g)(4) of the
Employee Retirement Income Security Act of 1974 and 436(e) of
the Internal Revenue Code of 1986 only to the extent that
such section produces a higher adjusted funding target
attainment percentage for such plan for such year.
(c) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to plan years
beginning on or after October 1, 2008.
(2) Special rule.--In the case of a plan for which the
valuation date is not the first day of the plan year, the
amendments made by this section shall apply to plan years
beginning after December 31, 2007.

SEC. 304. LOOKBACK FOR CREDIT BALANCE RULE FOR PLANS
MAINTAINED BY CHARITIES.

(a) Amendment to Erisa.--Paragraph (3) of section 303(f) of
the Employee Retirement Income Security Act of 1974 is
amended by adding the following at the end thereof:
``(D) Special rule for certain years of plans maintained by
charities.--
``(i) In general.--For purposes of applying subparagraph
(C) for plan years beginning after August 31, 2009, and
before September 1, 2011, the ratio determined under such
subparagraph for the preceding plan year shall be the greater
of--

``(I) such ratio, as determined without regard to this
subparagraph, or
``(II) the ratio for such plan for the plan year beginning
after August 31, 2007, and before September 1, 2008, as
determined under rules prescribed by the Secretary of the
Treasury.

``(ii) Special rule.--In the case of a plan for which the
valuation date is not the first day of the plan year--

``(I) clause (i) shall apply to plan years beginning after
December 31, 2008, and before January 1, 2011, and
``(II) clause (i)(II) shall apply based on the last plan
year beginning before September 1, 2007, as determined under
rules prescribed by the Secretary of the Treasury.

``(iii) Limitation to charities.--This subparagraph shall
not apply to any plan unless such plan is maintained
exclusively by one or more organizations described in section
501(c)(3) of the Internal Revenue Code of 1986.''.
(b) Amendment to Internal Revenue Code of 1986.--Paragraph
(3) of section 430(f) of the Internal Revenue Code of 1986 is
amended by adding the following at the end thereof:
``(D) Special rule for certain years of plans maintained by
charities.--
``(i) In general.--For purposes of applying subparagraph
(C) for plan years beginning after August 31, 2009, and
before September 1, 2011, the ratio determined under such
subparagraph for the preceding plan year of a plan shall be
the greater of--

``(I) such ratio, as determined without regard to this
subsection, or
``(II) the ratio for such plan for the plan year beginning
after August 31, 2007 and before September 1, 2008, as
determined under rules prescribed by the Secretary.

``(ii) Special rule.--In the case of a plan for which the
valuation date is not the first day of the plan year--

``(I) clause (i) shall apply to plan years beginning after
December 31, 2007, and before January 1, 2010, and
``(II) clause (i)(II) shall apply based on the last plan
year beginning before September 1, 2007, as determined under
rules prescribed by the Secretary.

``(iii) Limitation to charities.--This subparagraph shall
not apply to any plan unless such plan is maintained
exclusively by one or more organizations described in section
501(c)(3).''.
(c) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to plan years
beginning after August 31, 2009.
(2) Special rule.--In the case of a plan for which the
valuation date is not the first day of the plan year, the
amendments made by this section shall apply to plan years
beginning after December 31, 2008.

Subtitle B--Multiemployer Plans

SEC. 321. ADJUSTMENTS TO FUNDING STANDARD ACCOUNT RULES.

(a) Adjustments.--
(1) Amendment to erisa.--Section 304(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1084(b)) is
amended by adding at the end the following new paragraph:
``(8) Special relief rules.--Notwithstanding any other
provision of this subsection--
``(A) Amortization of net investment losses.--
``(i) In general.--A multiemployer plan with respect to
which the solvency test under subparagraph (C) is met may
treat the portion of any experience loss or gain attributable
to net investment losses incurred in either or both of the
first two plan years ending after August 31, 2008, as an item
separate from other experience losses, to be amortized in
equal annual installments (until fully amortized) over the
period --

``(I) beginning with the plan year in which such portion is
first recognized in the actuarial value of assets, and
``(II) ending with the last plan year in the 30-plan year
period beginning with the plan year in which such net
investment loss was incurred.

``(ii) Coordination with extensions.--If this subparagraph
applies for any plan year--

``(I) no extension of the amortization period under clause
(i) shall be allowed under subsection (d), and
``(II) if an extension was granted under subsection (d) for
any plan year before the election to have this subparagraph
apply to the plan year, such extension shall not result in
such amortization period exceeding 30 years.

``(iii) Net investment losses.--For purposes of this
subparagraph--

``(I) In general.--Net investment losses shall be
determined in the manner prescribed by the Secretary of the
Treasury on the basis of the difference between actual and
expected returns (including any difference attributable to
any criminally fraudulent investment arrangement).
``(II) Criminally fraudulent investment arrangements.--The
determination as to whether an arrangement is a criminally
fraudulent investment arrangement shall be made under rules
substantially similar to the rules prescribed by the
Secretary of the Treasury for purposes of section 165 of the
Internal Revenue Code of 1986.

``(B) Expanded smoothing period.--
``(i) In general.--A multiemployer plan with respect to
which the solvency test under subparagraph (C) is met may
change its asset valuation method in a manner which--

``(I) spreads the difference between expected and actual
returns for either or both of the first 2 plan years ending
after August 31, 2008, over a period of not more than 10
years,
``(II) provides that for either or both of the first 2 plan
years beginning after August 31, 2008, the value of plan
assets at any time shall not be less than 80 percent or
greater than 130 percent of the fair market value of such
assets at such time, or
``(III) makes both changes described in subclauses (I) and
(II) to such method.

``(ii) Asset valuation methods.--If this subparagraph
applies for any plan year--

``(I) the Secretary of the Treasury shall not treat the
asset valuation method of the plan as unreasonable solely
because of the changes in such method described in clause
(i), and
``(II) such changes shall be deemed approved by such
Secretary under section 302(d)(1) and section 412(d)(1) of
such Code.

``(iii) Amortization of reduction in unfunded accrued
liability.--If this subparagraph and subparagraph (A) both
apply for any plan year, the plan shall treat any reduction
in unfunded accrued liability resulting from the application
of this subparagraph as a separate experience amortization
base, to be amortized in equal annual installments (until
fully amortized) over a period of 30 plan years rather than
the period such liability would otherwise be amortized over.
``(C) Solvency test.--The solvency test under this
paragraph is met only if the plan actuary certifies that the
plan is projected to have sufficient assets to timely pay
expected benefits and anticipated expenditures over the
amortization period, taking into account the changes in the
funding standard account under this paragraph.
``(D) Restriction on benefit increases.--If subparagraph
(A) or (B) apply to a multiemployer plan for any plan year,
then, in addition to any other applicable restrictions on
benefit increases, a plan amendment increasing benefits may
not go into effect during either of the 2 plan years
immediately following such plan year unless--
``(i) the plan actuary certifies that--

[[Page S5127]]

``(I) any such increase is paid for out of additional
contributions not allocated to the plan immediately before
the application of this paragraph to the plan, and
``(II) the plan's funded percentage and projected credit
balances for such 2 plan years are reasonably expected to be
at least as high as such percentage and balances would have
been if the benefit increase had not been adopted, or

``(ii) the amendment is required as a condition of
qualification under part I of subchapter D of chapter 1 of
the Internal Revenue Code of 1986 or to comply with other
applicable law.
``(E) Reporting.--A plan sponsor of a plan to which this
paragraph applies shall--
``(i) give notice of such application to participants and
beneficiaries of the plan, and
``(ii) inform the Pension Benefit Guaranty Corporation of
such application in such form and manner as the Director of
the Pension Benefit Guaranty Corporation may prescribe.''.
(2) Amendment to internal revenue code of 1986.--Section
431(b) is amended by adding at the end the following new
paragraph:
``(8) Special relief rules.--Notwithstanding any other
provision of this subsection--
``(A) Amortization of net investment losses.--
``(i) In general.--A multiemployer plan with respect to
which the solvency test under subparagraph (C) is met may
treat the portion of any experience loss or gain attributable
to net investment losses incurred in either or both of the
first two plan years ending after August 31, 2008, as an item
separate from other experience losses, to be amortized in
equal annual installments (until fully amortized) over the
period --

``(I) beginning with the plan year in which such portion is
first recognized in the actuarial value of assets, and
``(II) ending with the last plan year in the 30-plan year
period beginning with the plan year in which such net
investment loss was incurred.

``(ii) Coordination with extensions.--If this subparagraph
applies for any plan year--

``(I) no extension of the amortization period under clause
(i) shall be allowed under subsection (d), and
``(II) if an extension was granted under subsection (d) for
any plan year before the election to have this subparagraph
apply to the plan year, such extension shall not result in
such amortization period exceeding 30 years.

``(iii) Net investment losses.--For purposes of this
subparagraph--

``(I) In general.--Net investment losses shall be
determined in the manner prescribed by the Secretary on the
basis of the difference between actual and expected returns
(including any difference attributable to any criminally
fraudulent investment arrangement).
``(II) Criminally fraudulent investment arrangements.--The
determination as to whether an arrangement is a criminally
fraudulent investment arrangement shall be made under rules
substantially similar to the rules prescribed by the
Secretary for purposes of section 165.

``(B) Expanded smoothing period.--
``(i) In general.--A multiemployer plan with respect to
which the solvency test under subparagraph (C) is met may
change its asset valuation method in a manner which--

``(I) spreads the difference between expected and actual
returns for either or both of the first 2 plan years ending
after August 31, 2008, over a period of not more than 10
years,
``(II) provides that for either or both of the first 2 plan
years beginning after August 31, 2008, the value of plan
assets at any time shall not be less than 80 percent or
greater than 130 percent of the fair market value of such
assets at such time, or
``(III) makes both changes described in subclauses (I) and
(II) to such method.

``(ii) Asset valuation methods.--If this subparagraph
applies for any plan year--

``(I) the Secretary shall not treat the asset valuation
method of the plan as unreasonable solely because of the
changes in such method described in clause (i), and
``(II) such changes shall be deemed approved by the
Secretary under section 302(d)(1) of the Employee Retirement
Income Security Act of 1974 and section 412(d)(1).

``(iii) Amortization of reduction in unfunded accrued
liability.--If this subparagraph and subparagraph (A) both
apply for any plan year, the plan shall treat any reduction
in unfunded accrued liability resulting from the application
of this subparagraph as a separate experience amortization
base, to be amortized in equal annual installments (until
fully amortized) over a period of 30 plan years rather than
the period such liability would otherwise be amortized over.
``(C) Solvency test.--The solvency test under this
paragraph is met only if the plan actuary certifies that the
plan is projected to have sufficient assets to timely pay
expected benefits and anticipated expenditures over the
amortization period, taking into account the changes in the
funding standard account under this paragraph.
``(D) Restriction on benefit increases.--If subparagraph
(A) or (B) apply to a multiemployer plan for any plan year,
then, in addition to any other applicable restrictions on
benefit increases, a plan amendment increasing benefits may
not go into effect during either of the 2 plan years
immediately following such plan year unless--
``(i) the plan actuary certifies that--

``(I) any such increase is paid for out of additional
contributions not allocated to the plan immediately before
the application of this paragraph to the plan, and
``(II) the plan's funded percentage and projected credit
balances for such 2 plan years are reasonably expected to be
at least as high as such percentage and balances would have
been if the benefit increase had not been adopted, or

``(ii) the amendment is required as a condition of
qualification under part I of subchapter D or to comply with
other applicable law.
``(E) Reporting.--A plan sponsor of a plan to which this
paragraph applies shall--
``(i) give notice of such application to participants and
beneficiaries of the plan, and
``(ii) inform the Pension Benefit Guaranty Corporation of
such application in such form and manner as the Director of
the Pension Benefit Guaranty Corporation may prescribe.''.
(b) Effective Dates.--
(1) In general.--The amendments made by this section shall
take effect as of the first day of the first plan year ending
after August 31, 2008, except that any election a plan makes
pursuant to this section that affects the plan's funding
standard account for the first plan year beginning after
August 31, 2008, shall be disregarded for purposes of
applying the provisions of section 305 of the Employee
Retirement Income Security Act of 1974 and section 432 of the
Internal Revenue Code of 1986 to such plan year.
(2) Restrictions on benefit increases.--Notwithstanding
paragraph (1), the restrictions on plan amendments increasing
benefits in sections 304(b)(8)(D) of such Act and
431(b)(8)(D) of such Code, as added by this section, shall
take effect on the date of enactment of this Act.

TITLE IV--REVENUE OFFSETS

SEC. 401. ROLLOVERS FROM ELECTIVE DEFERRAL PLANS TO ROTH
DESIGNATED ACCOUNTS.

(a) In General.--Section 402A(c) of the Internal Revenue
Code of 1986 is amended by adding at the end the following
new paragraph:
``(4) Taxable rollovers to designated roth accounts.--
``(A) In general.--Notwithstanding sections 402(c),
403(b)(8), and 457(e)(16), in the case of any distribution to
which this paragraph applies--
``(i) there shall be included in gross income any amount
which would be includible were it not part of a qualified
rollover contribution,
``(ii) section 72(t) shall not apply, and
``(iii) unless the taxpayer elects not to have this clause
apply, any amount required to be included in gross income for
any taxable year beginning in 2010 by reason of this
paragraph shall be so included ratably over the 2-taxable-
year period beginning with the first taxable year beginning
in 2011.

Any election under clause (iii) for any distributions during
a taxable year may not be changed after the due date for such
taxable year.
``(B) Distributions to which paragraph applies.--In the
case of an applicable retirement plan which includes a
qualified Roth contribution program, this paragraph shall
apply to a distribution from such plan other than from a
designated Roth account which is contributed in a qualified
rollover contribution to the designated Roth account
maintained under such plan for the benefit of the individual
to whom the distribution is made.
``(C) Other rules.--The rules of subparagraphs (D), (E),
and (F) of section 408A(d)(3) (as in effect for taxable years
beginning after 2009) shall apply for purposes of this
paragraph.''.

SEC. 402. PARTICIPANTS IN GOVERNMENT SECTION 457 PLANS
ALLOWED TO TREAT ELECTIVE DEFERRALS AS ROTH
CONTRIBUTIONS.

(a) In General.--Section 402A(e)(1) (defining applicable
retirement plan) is amended by striking ``and'' at the end of
subparagraph (A), by striking the period at the end of
subparagraph (B) and inserting ``, and'', and by adding at
the end the following:
``(C) an eligible deferred compensation plan (as defined in
section 457(b)) of an eligible employer described in section
457(e)(1)(A).''.
(b) Elective Deferrals.--Section 402A(e)(2) (defining
elective deferral) is amended to read as follows:
``(2) Elective deferral.--The term `elective deferral'
means--
``(A) any elective deferral described in subparagraph (A)
or (C) of section 402(g)(3), and
``(B) any elective deferral of compensation by an
individual under an eligible deferred compensation plan (as
defined in section 457(b)) of an eligible employer described
in section 457(e)(1)(A).''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2010.

SEC. 403. TEMPORARY ONE-YEAR FREEZE ON RAISES, BONUSES, AND
OTHER SALARY INCREASES FOR FEDERAL EMPLOYEES.

Notwithstanding any other provision of law, civilian
employees of the Federal Government in fiscal year 2011 shall
not receive a cost of living adjustment or other salary
increase, including a bonus. The salaries of members of the
armed forces are exempt from the provisions of this section.

[[Page S5128]]

SEC. 404. CAPPING THE TOTAL NUMBER OF FEDERAL EMPLOYEES.

(a) In General.--Not later than 3 months after the date of
enactment of this Act, the head of each relevant Federal
department or agency shall collaborate with the Director of
the Office of Management and Budget to determine how many
full-time employees the department or agency employs. For
each new full-time employee added to any Federal department
or agency for any purpose, the head of such department or
agency shall ensure that the addition of such new employee is
offset by a reduction of one existing full-time employee at
such department or agency.
(b) Information on Total Employees.--The Director of the
Office of Management and Budget shall publicly disclose the
total number of Federal employees, as well as a breakdown of
Federal employees by agency and the annual salary by title of
each Federal employee at an agency and update such
information not less than once a year.

SEC. 405. COLLECTION OF UNPAID TAXES FROM EMPLOYEES OF THE
FEDERAL GOVERNMENT.

(a) In General.--Chapter 73 of title 5, United States Code,
is amended by adding at the end the following:

``SUBCHAPTER VIII--COLLECTION OF UNPAID TAXES FROM EMPLOYEES OF THE
FEDERAL GOVERNMENT

``Sec. 7381. Collection of unpaid taxes from employees of the
Federal Government

``(a) Definition.--For purposes of this section--
``(1) the term `seriously delinquent tax debt' means an
outstanding debt under the Internal Revenue Code of 1986 for
which a notice of lien has been filed in public records
pursuant to section 6323 of such Code, except that such term
does not include--
``(A) a debt that is being paid in a timely manner pursuant
to an agreement under section 6159 or section 7122 of such
Code; and
``(B) a debt with respect to which a collection due process
hearing under section 6330 of such Code, or relief under
subsection (a), (b), or (f) of section 6015 of such Code, is
requested or pending; and
``(2) the term `Federal employee' means--
``(A) an employee, as defined by section 2105; and
``(B) an employee of the United States Congress, including
Members of the House of Representatives and Senators.
``(b) Collection of Unpaid Taxes.--The Internal Revenue
Service shall coordinate with the Department of Treasury and
the hiring agency of a Federal employee who has a seriously
delinquent tax debt to collect such taxes by withholding a
portion of the employee's salary over a period set by the
hiring agency to ensure prompt payment.''.
(b) Clerical Amendment.--The analysis for chapter 73 of
title 5, United States Code, is amended by adding at the end
the following:

``subchapter viii--collection of unpaid taxes from employees of the
federal government

``Sec. 7381. Collection of unpaid taxes from employees of the Federal
Government.''.

SEC. 406. REDUCING PRINTING AND PUBLISHING COSTS OF
GOVERNMENT DOCUMENTS.

Within 90 days after the date of enactment of this Act, the
Director of the Office of Management and Budget shall
coordinate with the heads of Federal departments and
independent agencies to determine which Government
publications could be available on Government websites and no
longer printed and to devise a strategy to reduce overall
Government printing costs by no less than a total of
$4,600,000 over the 10-year period beginning with fiscal year
2010. The Director shall ensure that essential printed
documents prepared for Social Security recipients, Medicare
beneficiaries, and other populations in areas with limited
internet access or use continue to remain available.

SEC. 407. REDUCING EXCESSIVE DUPLICATION, OVERHEAD AND
SPENDING WITHIN THE FEDERAL GOVERNMENT.

(a) Reducing Duplication.--The Director of the Office of
Management Budget and the Secretary of each department (or
head of each independent agency) shall work with the Chairman
and ranking member of the relevant congressional
appropriations subcommittees and the congressional
authorizing committees and the Director of the Office of
Management Budget to consolidate programs with duplicative
goals, missions, and initiatives.
(b) Controlling Bureaucratic Overhead Costs.--Each Federal
department and agency shall reduce annual administrative
expenses by at least five percent in fiscal year 2011.
(c) Rescissions of Excessive Spending.--There is hereby
rescinded an amount equal to 5 percent of--
(1) the budget authority provided (or obligation limit
imposed) for fiscal year 2010 for any discretionary account
in any other fiscal year 2010 appropriation Act;
(2) the budget authority provided in any advance
appropriation for fiscal year 2010 for any discretionary
account in any prior fiscal year appropriation Act; and
(3) the contract authority provided in fiscal year 2010 for
any program subject to limitation contained in any fiscal
year 2010 appropriation Act.
(d) Proportionate Application.--Any rescission made by
subsection (a) shall be applied proportionately--
(1) to each discretionary account and each item of budget
authority described in such subsection; and
(2) within each such account and item, to each program,
project, and activity (with programs, projects, and
activities as delineated in the appropriation Act or
accompanying reports for the relevant fiscal year covering
such account or item, or for accounts and items not included
in appropriation Acts, as delineated in the most recently
submitted President's budget)
(e) Exceptions.--This section shall not apply to
discretionary authority appropriated or otherwise made
available to the Department of Veterans Affairs and the
Department of Defense.
(f) OMB Report.--Within 30 days after the date of enactment
of this section, the Director of the Office of Management and
Budget shall submit to the Committees on Appropriations of
the House of Representatives and the Senate a report
specifying the account and amount of each rescission made
pursuant to this section and the report shall be posted on
the public website of the Office of Management and Budget.

SEC. 408. ELIMINATING NONESSENTIAL GOVERNMENT TRAVEL.

Within 60 days after the date of enactment of this Act, the
Director of the Office of Management and Budget, in
consultation with the heads of the Federal departments and
agencies, shall establish a definition of ``nonessential
travel'' and criteria to determine if travel-related expenses
and requests by Federal employees meet the definition of
``nonessential travel''. No travel expenses paid for, in
whole or in part, with Federal funds shall be paid by the
Federal Government unless a request is made prior to the
travel and the requested travel meets the criteria
established by this section. Any travel request that does not
meet the definition and criteria shall be disallowed,
including reimbursement for air flights, automobile rentals,
train tickets, lodging, per diem, and other travel-related
costs. The definition established by the Director of the
Office of Management and Budget may include exemptions in the
definition, including travel related to national defense,
homeland security, border security, national disasters, and
other emergencies. The Director of the Office of Management
and Budget shall ensure that all travel costs paid for in
part or whole by the Federal Government not related to
national defense, homeland security, border security,
national disasters, and other emergencies do not exceed
$5,000,000,000 annually.

SEC. 409. ELIMINATING BONUSES FOR POOR PERFORMANCE BY
GOVERNMENT CONTRACTORS.

(a) Guidance on Linking of Award and Incentive Fees to
Outcomes.--Not later than 180 days after the date of
enactment of this Act, each Federal department or agency
shall issue guidance, with detailed implementation
instructions (including definitions), on the appropriate use
of award and incentive fees in department or agency programs.
(b) Elements.--The guidance under subsection (a) shall--
(1) ensure that all new contracts using award fees link
such fees to outcomes (which shall be defined in terms of
program cost, schedule, and performance);
(2) establish standards for identifying the appropriate
level of officials authorized to approve the use of award and
incentive fees in new contracts;
(3) provide guidance on the circumstances in which
contractor performance may be judged to be excellent or
superior and the percentage of the available award fee which
contractors should be paid for such performance;
(4) establish standards for determining the percentage of
the available award fee, if any, which contractors should be
paid for performance that is judged to be acceptable,
average, expected, good, or satisfactory;
(5) ensure that no award fee may be paid for contractor
performance that is judged to be below satisfactory
performance or performance that does not meet the basic
requirements of the contract;
(6) provide specific direction on the circumstances, if
any, in which it may be appropriate to roll over award fees
that are not earned in one award fee period to a subsequent
award fee period or periods;
(7) ensure that the Department or agency--
(A) collects relevant data on award and incentive fees paid
to contractors; and
(B) has mechanisms in place to evaluate such data on a
regular basis; and
(8) include performance measures to evaluate the
effectiveness of award and incentive fees as a tool for
improving contractor performance and achieving desired
program outcomes.
(c) Return of Unearned Bonuses.--Any funds intended to be
awarded as incentive fees that are not paid due to
contractors inability to meet the criteria established by
this section shall be returned to the Treasury.

SEC. 410. $1,000,000,000 LIMITATION ON VOLUNTARY PAYMENTS TO
THE UNITED NATIONS.

Notwithstanding any other provision of law, the Secretary
of State shall ensure no more than $1,000,000,000 is provided
to the United Nations each year in excess of the United
States' annual assessed contributions

[[Page S5129]]

SEC. 411. RESCINDING A STATE DEPARTMENT TRAINING FACILITY
UNWANTED BY RESIDENTS OF THE COMMUNITY IN WHICH
IT IS PLANNED TO BE CONSTRUCTED.

Notwithstanding any other provision of law, no Federal
funds may be spent to construct a State Department training
facility in Ruthsberg, Maryland, and any funding obligated
for the facility by Public Law 111-5 are rescinded, Provided
That, this section does not prohibit funds otherwise
appropriated to be spent by the State Department for training
facilities in other jurisdictions in accordance with law.

SEC. 412. REDUCING BUDGETS OF MEMBERS OF CONGRESS.

(a) In General.--Of the funds made available under Public
Law 111-68 for the legislative branch, $100,000,000 in
unobligated balances are permanently rescinded on a pro rata
basis: Provided, That the rescissions made by the section
shall not apply to funds made available to the Capitol
Police.
(b) Reporting.--The Director of the Office of Management
and Budget shall report to Congress the amounts rescinded
under subsection (a).

SEC. 413. DISPOSING OF UNNEEDED AND UNUSED GOVERNMENT
PROPERTY.

(a) In General.--Chapter 5 of subtitle I of title 40,
United States Code, is amended by adding at the end the
following:

``SUBCHAPTER VII--EXPEDITED DISPOSAL OF REAL PROPERTY

``Sec. 621. Definitions

``In this subchapter:
``(1) Director.--The term `Director' means the Director of
the Office of Management and Budget.
``(2) Expedited disposal of a real property.--The term
`expedited disposal of a real property' means a demolition of
real property or a sale of real property for cash that is
conducted under the requirements of section 545.
``(3) Landholding agency.--The term `landholding agency'
means a landholding agency as defined under section 501(i)(3)
of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11411(i)(3)).
``(4) Real property.--
``(A) In general.--The term `real property' means--
``(i) a parcel of real property under the administrative
jurisdiction of the Federal Government that is--

``(I) excess;
``(II) surplus;
``(III) underperforming; or
``(IV) otherwise not meeting the needs of the Federal
Government, as determined by the Director; and

``(ii) a building or other structure located on real
property described under clause (i).
``(B) Exclusion.--The term `real property' excludes any
parcel of real property or building or other structure
located on such real property that is to be closed or
realigned under the Defense Base Closure and Realignment Act
of 1990 (part A of title XXIX of Public Law 101-510; 10
U.S.C. 2687 note).

``Sec. 622. Disposal program

``(a) The Director of the Office of Management and Budget
shall dispose of by sale or auction not less than
$15,000,000,000 worth of real property that is not meeting
Federal Government from fiscal year 2010 to fiscal year 2015.
``(b) Agencies shall recommend candidate disposition real
properties to the Director for participation in the pilot
program established under section 622.
``(c) The Director, with the concurrence of the head of the
executive agency concerned and consistent with the criteria
established in this subchapter, may then select such
candidate real properties for participation in the program
and notify the recommending agency accordingly.
``(d) The Director shall ensure that all real properties
selected for disposition under this section are listed on a
website that shall--
``(1) be updated routinely; and
``(2) include the functionality to allow members of the
public, at their option, to receive such updates through
electronic mail.
``(e) The Director may transfer real property identified in
the enactment of this section to the Department of Housing
and Urban Development if the Secretary of Housing and Urban
Development has determined such properties are suitable for
use to assist the homeless.''.
(b) Technical and Conforming Amendment.--The table of
sections for chapter 5 of subtitle I of title 40, United
States Code, is amended by inserting after the item relating
to section 611 the following:

``subchapter vii--expedited disposal of real property

``Sec. 621. Definitions .
``Sec. 622. Disposal program.''.

SEC. 414. AUCTIONING AND SELLING OF UNUSED AND UNNEEDED
EQUIPMENT.

(a) Notwithstanding section 1033 of the National Defense
Authorization Act of 1997 or any other provision of law, the
Secretary of Defense shall auction or sell unused,
unnecessary, or surplus supplies and equipment without
providing preference to State or local governments.
(b) The Secretary may make exceptions to the sale or
auction of such equipment for transfers of excess military
property to state and local law enforcement agencies related
to counter-drug efforts, counter-terrorism activities, or
other efforts determined to be related to national defense or
homeland security. The Secretary of Defense may sell such
equipment to State and local agencies at fair market value.

SEC. 415. RESCINDING UNSPENT FEDERAL FUNDS.

(a) In General.--Notwithstanding any other provision of
law, of all available unobligated Federal funds,
$80,000,000,000 in appropriated discretionary unexpired funds
are rescinded.
(b) Implementation.--Not later than 60 days after the date
of enactment of this Act, the Director of the Office of
Management and Budget shall--
(1) identify the accounts and amounts rescinded to
implement subsection (a); and
(2) submit a report to the Secretary of the Treasury and
Congress of the accounts and amounts identified under
paragraph (1) for rescission.
(c) Exception.--This section shall not apply to the
unobligated Federal funds of the Department of Defense or the
Department of Veterans Affairs.

SEC. 416. USE OF STIMULUS FUNDS TO OFFSET SPENDING.

The unobligated balance of each amount appropriated or made
available under the American Recovery and Reinvestment Act of
2009 (Public Law 111-5) (other than under title X of division
A of such Act) is rescinded such that the aggregate amount of
such rescissions equal $37,500,000,000 in order to offset the
net increase in spending resulting from the provisions of,
and amendments made by, this Act. The Director of the Office
of Management and Budget shall report to each congressional
committee the amounts so rescinded within the jurisdiction of
such committee.

SEC. 417. DEFICIT REDUCTION TRUST FUND.

(a) In General.--Subchapter I of chapter 31 of title 31,
United States Code, is amended by adding at the end the
following new section:

``Sec. 3114. Certain rescinded stimulus funds to reduce
public debt

``(a) There is established in the Treasury of the United
States a trust fund to be known as the `Deficit Reduction
Trust Fund' (in this section referred to as the `Trust
Fund').
``(b) There is appropriated to the Trust Fund the following
amounts:
``(1) Amounts equivalent to the reductions in Federal
spending, as estimated by the Secretary from time to time, as
a result of the provisions of sections 403, 404, 406, 407
(other than subsection (c) thereof), 408, 409, 410, and 414
of the American Jobs and Closing Tax Loopholes Act of 2010.
``(2) Amounts equivalent to the amounts rescinded under
sections 407(c), 411, 412, 415, and 416 of the American Jobs
and Closing Tax Loopholes Act of 2010.
``(3) Amounts equivalent to the amounts received under the
program established under section 622 of title 5, United
States Code.
``(4) The amount of taxes received in the Treasury
attributable to section 7384 of the Internal Revenue Code of
1986 and the amendments made by sections 401 and 402 of the
American Jobs and Closing Tax Loopholes Act of 2010, as
estimated by the Secretary.
``(c) The Secretary of the Treasury shall use the moneys in
the Trust Fund solely to pay at maturity, or to redeem or buy
before maturity, an obligation of the Government included in
the public debt.
``(d) Any obligation of the Government which is paid,
redeemed, or bought with money from the Trust Fund shall be
canceled and retired and may not be reissued.''.
(b) Conforming Amendment.--The table of sections for
subchapter I of chapter 31 of title 31, United States Code,
is amended by adding at the end the following new item:

``3114. Certain rescinded stimulus funds to reduce public debt.''.

TITLE V--UNEMPLOYMENT, HEALTH, AND OTHER ASSISTANCE

Subtitle A--Unemployment Insurance and Other Assistance

SEC. 501. EXTENSION OF UNEMPLOYMENT INSURANCE PROVISIONS.

(a) In General.--(1) Section 4007 of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note) is amended--
(A) by striking ``June 2, 2010'' each place it appears and
inserting ``November 30, 2010'';
(B) in the heading for subsection (b)(2), by striking
``june 2, 2010'' and inserting ``november 30, 2010''; and
(C) in subsection (b)(3), by striking ``November 6, 2010''
and inserting ``April 30, 2011''.
(2) Section 2002(e) of the Assistance for Unemployed
Workers and Struggling Families Act, as contained in Public
Law 111-5 (26 U.S.C. 3304 note; 123 Stat. 438), is amended--
(A) in paragraph (1)(B), by striking ``June 2, 2010'' and
inserting ``November 30, 2010'';
(B) in the heading for paragraph (2), by striking ``june 2,
2010'' and inserting ``november 30, 2010''; and
(C) in paragraph (3), by striking ``December 7, 2010'' and
inserting ``May 31, 2011''.
(3) Section 2005 of the Assistance for Unemployed Workers
and Struggling Families Act, as contained in Public Law 111-5
(26 U.S.C. 3304 note; 123 Stat. 444), is amended--
(A) by striking ``June 2, 2010'' each place it appears and
inserting ``December 1, 2010''; and
(B) in subsection (c), by striking ``November 6, 2010'' and
inserting ``May 1, 2011''.
(4) Section 5 of the Unemployment Compensation Extension
Act of 2008 (Public Law 110-449; 26 U.S.C. 3304 note) is
amended by

[[Page S5130]]

striking ``November 6, 2010'' and inserting ``April 30,
2011''.
(b) Funding.--Section 4004(e)(1) of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note) is amended--
(1) in subparagraph (D), by striking ``and'' at the end;
and
(2) by inserting after subparagraph (E) the following:
``(F) the amendments made by section 501(a)(1) of the
American Jobs and Closing Tax Loopholes Act of 2010; and''.
(c) Conditions for Receiving Emergency Unemployment
Compensation.--Section 4001(d)(2) of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note) is amended, in the matter preceding subparagraph (A),
by inserting before ``shall apply'' the following:
``(including terms and conditions relating to availability
for work, active search for work, and refusal to accept
work)''.
(d) Effective Date.--The amendments made by this section
shall take effect as if included in the enactment of the
Continuing Extension Act of 2010 (Public Law 111-157).

SEC. 502. COORDINATION OF EMERGENCY UNEMPLOYMENT COMPENSATION
WITH REGULAR COMPENSATION.

(a) Certain Individuals Not Ineligible by Reason of New
Entitlement to Regular Benefits.--Section 4002 of the
Supplemental Appropriations Act, 2008 (Public Law 110-252; 26
U.S.C. 3304 note) is amended by adding at the end the
following:
``(g) Coordination of Emergency Unemployment Compensation
With Regular Compensation.--
``(1) If--
``(A) an individual has been determined to be entitled to
emergency unemployment compensation with respect to a benefit
year,
``(B) that benefit year has expired,
``(C) that individual has remaining entitlement to
emergency unemployment compensation with respect to that
benefit year, and
``(D) that individual would qualify for a new benefit year
in which the weekly benefit amount of regular compensation is
at least either $100 or 25 percent less than the individual's
weekly benefit amount in the benefit year referred to in
subparagraph (A),
then the State shall determine eligibility for compensation
as provided in paragraph (2).
``(2) For individuals described in paragraph (1), the State
shall determine whether the individual is to be paid
emergency unemployment compensation or regular compensation
for a week of unemployment using one of the following
methods:
``(A) The State shall, if permitted by State law, establish
a new benefit year, but defer the payment of regular
compensation with respect to that new benefit year until
exhaustion of all emergency unemployment compensation payable
with respect to the benefit year referred to in paragraph
(1)(A);
``(B) The State shall, if permitted by State law, defer the
establishment of a new benefit year (which uses all the wages
and employment which would have been used to establish a
benefit year but for the application of this paragraph),
until exhaustion of all emergency unemployment compensation
payable with respect to the benefit year referred to in
paragraph(1)(A);
``(C) The State shall pay, if permitted by State law--
``(i) regular compensation equal to the weekly benefit
amount established under the new benefit year, and
``(ii) emergency unemployment compensation equal to the
difference between that weekly benefit amount and the weekly
benefit amount for the expired benefit year; or
``(D) The State shall determine rights to emergency
unemployment compensation without regard to any rights to
regular compensation if the individual elects to not file a
claim for regular compensation under the new benefit year.''.
(b) Effective Date.--The amendment made by this section
shall apply to individuals whose benefit years, as described
in section 4002(g)(1)(B) the Supplemental Appropriations Act,
2008 (Public Law 110-252; 26 U.S.C. 3304 note), as amended by
this section, expire after the date of enactment of this Act.

Subtitle B--Physician Payment Update and Other Provisions

PART I--PHYSICIAN PAYMENT UPDATE

SEC. 511. PHYSICIAN PAYMENT UPDATE.

Section 1848 of the Social Security Act (42 U.S.C. 1395w-4)
is amended--
(1) in subsection (d)--
(A) in paragraph (10), in the heading, by striking
``portion'' and inserting ``the first 5 months''; and
(B) by adding at the end the following new paragraph:
``(11) Update for the last 7 months of 2010 and for 2011
and 2012.--
``(A) In general.--Subject to paragraphs (7)(B), (8)(B),
(9)(B), and (10)(B), in lieu of the update to the single
conversion factor established in paragraph (1)(C) that would
otherwise apply--
``(i) for 2010 for the period beginning on June 1, 2010,
and ending on December 31, 2010, the update to the single
conversion factor shall be 2.0 percent; and
``(ii) for each of 2011 and 2012, the update to the single
conversion factor shall be 2.0 percent.
``(B) No effect on computation of conversion factor for
2013 and subsequent years.--The conversion factor under this
subsection shall be computed under paragraph (1)(A) for 2013
and subsequent years as if subparagraph (A) had never
applied.''; and
(2) in subsection (f), by adding at the end the following
new paragraph:
``(5) Temporary adjustment.--In determining the growth rate
under paragraph (2) for 2014, the Secretary's estimate of the
percentage change otherwise determined under paragraph (2)(D)
shall be reduced by 4.0 percentage points.''.

PART II--EXTENSION OF EXPIRING PROVISIONS

SEC. 521. EXTENSION OF MMA SECTION 508 RECLASSIFICATIONS.

Section 106(a) of division B of the Tax Relief and Health
Care Act of 2006 (42 U.S.C. 1395 note), as amended by section
117 of the Medicare, Medicaid, and SCHIP Extension Act of
2007 (Public Law 110-173), section 124 of the Medicare
Improvements for Patients and Providers Act of 2008 (Public
Law 110-275), and sections 3137(a) and 10317 of the Patient
Protection and Affordable Care Act (Public Law 111-148), is
amended by striking ``September 30, 2010'' and inserting
``September 30, 2011''.

SEC. 522. EXTENSION OF MEDICARE WORK GEOGRAPHIC ADJUSTMENT
FLOOR.

Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C.
1395w-4(e)(1)(E)), as amended by section 3102 of the Patient
Protection and Affordable Care Act (Public Law 111-148), is
amended by striking ``before January 1, 2011'' and inserting
``before January 1, 2012''.

SEC. 523. EXTENSION OF EXCEPTIONS PROCESS FOR MEDICARE
THERAPY CAPS.

Section 1833(g)(5) of the Social Security Act (42 U.S.C.
1395l(g)(5)) is amended by striking ``and ending on'' and all
that follows through ``2010'' and inserting ``and ending on
December 31, 2011''.

SEC. 524. EXTENSION OF PAYMENT FOR TECHNICAL COMPONENT OF
CERTAIN PHYSICIAN PATHOLOGY SERVICES.

Section 542(c) of the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000 (as enacted
into law by section 1(a)(6) of Public Law 106-554), as
amended by section 732 of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (42 U.S.C. 1395w-4
note), section 104 of division B of the Tax Relief and Health
Care Act of 2006 (42 U.S.C. 1395w-4 note), section 104 of the
Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public
Law 110-173), section 136 of the Medicare Improvements for
Patients and Providers Act of 2008 (Public Law 110-275), and
section 3104 of the Patient Protection and Affordable Care
Act (Public Law 111-148) is amended by striking ``and 2010''
and inserting ``2010, and 2011''.

SEC. 525. EXTENSION OF AMBULANCE ADD-ONS.

(a) Ground Ambulance.--Section 1834(l)(13)(A) of the Social
Security Act (42 U.S.C. 1395m(l)(13)(A)), as amended by
sections 3105(a) and 10311(a) of the Patient Protection and
Affordable Care Act (Public Law 111-148), is amended--
(1) in the matter preceding clause (i), by striking
``2011'' and inserting ``2012''; and
(2) in each of clauses (i) and (ii), by striking ``January
1, 2011'' and inserting ``January 1, 2012'' each place it
appears.
(b) Air Ambulance.--Section 146(b)(1) of the Medicare
Improvements for Patients and Providers Act of 2008 (Public
Law 110-275), as amended by sections 3105(b) and 10311(b) of
the Patient Protection and Affordable Care Act (Public Law
111-148), is amended by striking ``December 31, 2010'' and
inserting ``December 31, 2011''.
(c) Super Rural Ambulance.--Section 1834(l)(12)(A) of the
Social Security Act (42 U.S.C. 1395m(l)(12)(A)), as amended
by sections 3105(c) and 10311(c) of the Patient Protection
and Affordable Care Act (Public Law 111-148), is amended by
striking ``2011'' and inserting ``2012''.

SEC. 526. EXTENSION OF PHYSICIAN FEE SCHEDULE MENTAL HEALTH
ADD-ON PAYMENT.

Section 138(a)(1) of the Medicare Improvements for Patients
and Providers Act of 2008 (Public Law 110-275), as amended by
section 3107 of the Patient Protection and Affordable Care
Act (Public Law 111-148), is amended by striking ``December
31, 2010'' and inserting ``December 31, 2011''.

SEC. 527. EXTENSION OF OUTPATIENT HOLD HARMLESS PROVISION.

Section 1833(t)(7)(D)(i) of the Social Security Act (42
U.S.C. 1395l(t)(7)(D)(i)), as amended by section 3121(a) of
the Patient Protection and Affordable Care Act (Public Law
111-148), is amended--
(1) in subclause (II)--
(A) in the first sentence, by striking ``2011''and
inserting ``2012''; and
(B) in the second sentence, by striking ``or 2010'' and
inserting ``2010, or 2011''; and
(2) in subclause (III), by striking ``January 1, 2011'' and
inserting ``January 1, 2012''.

SEC. 528. EXTENSION OF MEDICARE REASONABLE COSTS PAYMENTS FOR
CERTAIN CLINICAL DIAGNOSTIC LABORATORY TESTS
FURNISHED TO HOSPITAL PATIENTS IN CERTAIN RURAL
AREAS.

Section 416(b) of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (42 U.S.C. 1395l-
4), as amended by section 105 of division B of the Tax Relief
and Health Care Act of 2006 (42 U.S.C. 1395l note), section
107 of the Medicare, Medicaid, and SCHIP Extension Act of
2007 (42 U.S.C. 1395l note), and section 3122 of the Patient
Protection and Affordable Care Act (Public Law 111-148), is
amended by striking ``the 1-year period beginning on July 1,
2010'' and inserting ``the 2-year period beginning on July 1,
2010''.

[[Page S5131]]

SEC. 529. EXTENSION OF THE QUALIFYING INDIVIDUAL (QI)
PROGRAM.

(a) Extension.--Section 1902(a)(10)(E)(iv) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is amended by
striking ``December 2010'' and inserting ``December 2011''.
(b) Extending Total Amount Available for Allocation.--
Section 1933(g) of such Act (42 U.S.C. 1396u-3(g)) is
amended--
(1) in paragraph (2)--
(A) by striking ``and'' at the end of subparagraph (M);
(B) in subparagraph (N), by striking the period at the end
and inserting a semicolon; and
(C) by adding at the end the following new subparagraphs:
``(O) for the period that begins on January 1, 2011, and
ends on September 30, 2011, the total allocation amount is
$720,000,000; and
``(P) for the period that begins on October 1, 2011, and
ends on December 31, 2011, the total allocation amount is
$280,000,000.''; and
(2) in paragraph (3), in the matter preceding subparagraph
(A), by striking ``or (N)'' and inserting ``(N), or (P)''.

SEC. 530. EXTENSION OF TRANSITIONAL MEDICAL ASSISTANCE (TMA).

Sections 1902(e)(1)(B) and 1925(f) of the Social Security
Act (42 U.S.C. 1396a(e)(1)(B), 1396r-6(f)) are each amended
by striking ``December 31, 2010'' and inserting ``December
31, 2011''.

SEC. 531. EXTENSION OF DRA COURT IMPROVEMENT GRANTS.

Section 438 of the Social Security Act (42 U.S.C. 629h) is
amended--
(1) in subsection (c)(2)(A), by striking ``2010'' and
inserting ``2011''; and
(2) in subsection (e), by striking ``2010'' and inserting
``2011''.

PART III--CHANGES TO THE PATIENT PROTECTION AND AFFORDABLE CARE ACT AND
ADDITIONAL PROVISIONS

Subpart A--Changes to the Patient Protection and Affordable Care Act
and Additional Provisions

SEC. 541. EXPANSION OF AFFORDABILITY EXCEPTION TO INDIVIDUAL
MANDATE.

Section 5000A(e)(1)(A) of the Internal Revenue Code of
1986, as added by section 1501(b) of the Patient Protection
and Affordable Care Act (Public Law 111-148), is amended by
striking ``8 percent'' and inserting ``5 percent''.

SEC. 542. REPLACEMENT OF MEDICAID PRIMARY CARE PAYMENT CLIFF.

(a) Payments to Primary Care Providers.--
(1) Grants to states to increase payments.--From the
amounts appropriated under paragraph (2), the Secretary of
Health and Human Services shall award grants to States with
an approved State plan amendment under the Medicaid program
under title XIX of the Social Security Act to permanently
increase payment rates to primary care providers under the
State Medicaid program above the rates applicable under the
State Medicaid program on the date of enactment of this Act.
Funds paid to a State from such a grant shall only be used
for expenditures attributable to the additional amounts paid
to such providers as a result of the increase in such rates.
(2) Appropriation.--Out of any funds in the Treasury not
otherwise appropriated, there is appropriated to the
Secretary of Health and Human Services on January 1, 2013,
$8,000,000,000, to remain available until expended.
(b) Repeal of Medicaid Primary Care Payment Cliff.--Section
1202 of the Health Care and Education Reconciliation Act of
2010 (Public Law 111-152) (and the amendments made by such
section) is repealed.

SEC. 543. ESTABLISH A CMS-IRS DATA MATCH TO IDENTIFY
FRAUDULENT PROVIDERS.

(a) Authority to Disclose Return Information Concerning
Outstanding Tax Debts for Purposes of Enhancing Medicare
Program Integrity.--
(1) In general.--Section 6103(l) of the Internal Revenue
Code of 1986 is amended by adding at the end the following
new paragraph:
``(22) Disclosure of return information to department of
health and human services for purposes of enhancing medicare
program integrity.--
``(A) In general.--The Secretary shall, upon written
request from the Secretary of Health and Human Services,
disclose to officers and employees of the Department of
Health and Human Services return information with respect to
a taxpayer who has applied to enroll, or reenroll, as a
provider of services or supplier under the Medicare program
under title XVIII of the Social Security Act. Such return
information shall be limited to--
``(i) the taxpayer identity information with respect to
such taxpayer;
``(ii) the amount of the delinquent tax debt owed by that
taxpayer; and
``(iii) the taxable year to which the delinquent tax debt
pertains.
``(B) Restriction on disclosure.--Return information
disclosed under subparagraph (A) may be used by officers and
employees of the Department of Health and Human Services for
the purposes of, and to the extent necessary in, establishing
the taxpayer's eligibility for enrollment or reenrollment in
the Medicare program, or in any administrative or judicial
proceeding relating to, or arising from, a denial of such
enrollment or reenrollment, or in determining the level of
enhanced oversight to be applied with respect to such
taxpayer pursuant to section 1866(j)(3) of the Social
Security Act.
``(C) Delinquent tax debt.--For purposes of this paragraph,
the term `delinquent tax debt' means an outstanding debt
under this title for which a notice of lien has been filed
pursuant to section 6323, but the term does not include a
debt that is being paid in a timely manner pursuant to an
agreement under section 6159 or 7122, or a debt with respect
to which a collection due process hearing under section 6330
is requested, pending, or completed and no payment is
required.''.
(2) Conforming amendments.--Section 6103(p)(4) of such
Code, as amended by sections 1414 and 3308 of Public Law 111-
148, in the matter preceding subparagraph (A) and in
subparagraph (F)(ii), is amended by striking ``or (17)'' and
inserting ``(17), or (22)'' each place it appears.
(b) Secretary's Authority to Use Information From the
Department of Treasury in Medicare Enrollments and
Reenrollments.--Section 1866(j)(2) of the Social Security Act
(42 U.S.C. 1395cc(j)), as inserted by section 6401(a) of
Public Law 111-148, is further amended--
(1) by redesignating subparagraph (E) as subparagraph (F);
and
(2) by inserting after subparagraph (D) the following new
subparagraph:
``(E) Use of information from the department of treasury
concerning tax debts.--In reviewing the application of a
provider of services or supplier to enroll or reenroll under
the program under this title, the Secretary shall take into
account the information supplied by the Secretary of the
Treasury pursuant to section 6103(l)(22) of the Internal
Revenue Code of 1986, in determining whether to deny such
application or to apply enhanced oversight to such provider
of services or supplier pursuant to paragraph (3) if the
Secretary determines such provider of services or supplier
owes such a debt.''.
(c) Authority to Adjust Payments of Providers of Services
and Suppliers With the Same Tax Identification Number for
Medicare Obligations.--Section 1866(j)(6) of the Social
Security Act (42 U.S.C. 1395cc(j)(6)), as inserted by section
6401(a) of Public Law 111-148, is amended--
(1) in the paragraph heading, by striking ``past-due'' and
inserting ``medicare'';
(2) in subparagraph (A), by striking ``past-due obligations
described in subparagraph (B)(ii) of an'' and inserting
``amount described in subparagraph (B)(ii) due from such'';
and
(3) in subparagraph (B)(ii), by striking ``a past-due
obligation'' and inserting ``an amount that is more than the
amount required to be paid''.

SEC. 544. FUNDING FOR CLAIMS REPROCESSING.

For purposes of carrying out the provisions of, and
amendments made by, this Act that relate to title XVIII of
the Social Security Act, and other provisions of such title
that involve reprocessing of claims, there are appropriated
to the Secretary of Health and Human Services for the Centers
for Medicare & Medicaid Services Program Management Account,
from amounts in the general fund of the Treasury not
otherwise appropriated, $175,000,000. Amounts appropriated
under the preceding sentence shall remain available until
expended.

Subpart B--Medical Liability Reform

SEC. 551. SHORT TITLE.

This subpart may be cited as the ``Medical Care Access
Protection Act of 2010'' or the ``MCAP Act''.

SEC. 552. FINDINGS AND PURPOSE.

(a) Findings.--
(1) Effect on health care access and costs.--Congress finds
that our current civil justice system is adversely affecting
patient access to health care services, better patient care,
and cost-efficient health care, in that the health care
liability system is a costly and ineffective mechanism for
resolving claims of health care liability and compensating
injured patients, and is a deterrent to the sharing of
information among health care professionals which impedes
efforts to improve patient safety and quality of care.
(2) Effect on interstate commerce.--Congress finds that the
health care and insurance industries are industries affecting
interstate commerce and the health care liability litigation
systems existing throughout the United States are activities
that affect interstate commerce by contributing to the high
costs of health care and premiums for health care liability
insurance purchased by health care system providers.
(3) Effect on federal spending.--Congress finds that the
health care liability litigation systems existing throughout
the United States have a significant effect on the amount,
distribution, and use of Federal funds because of--
(A) the large number of individuals who receive health care
benefits under programs operated or financed by the Federal
Government;
(B) the large number of individuals who benefit because of
the exclusion from Federal taxes of the amounts spent to
provide them with health insurance benefits; and
(C) the large number of health care providers who provide
items or services for which the Federal Government makes
payments.
(b) Purpose.--It is the purpose of this subpart to
implement reasonable, comprehensive, and effective health
care liability reforms designed to--
(1) improve the availability of health care services in
cases in which health care liability actions have been shown
to be a factor in the decreased availability of services;

[[Page S5132]]

(2) reduce the incidence of ``defensive medicine'' and
lower the cost of health care liability insurance, all of
which contribute to the escalation of health care costs;
(3) ensure that persons with meritorious health care injury
claims receive fair and adequate compensation, including
reasonable noneconomic damages;
(4) improve the fairness and cost-effectiveness of our
current health care liability system to resolve disputes
over, and provide compensation for, health care liability by
reducing uncertainty in the amount of compensation provided
to injured individuals; and
(5) provide an increased sharing of information in the
health care system which will reduce unintended injury and
improve patient care.

SEC. 553. DEFINITIONS.

In this subpart:
(1) Alternative dispute resolution system; adr.--The term
``alternative dispute resolution system'' or ``ADR'' means a
system that provides for the resolution of health care
lawsuits in a manner other than through a civil action
brought in a State or Federal court.
(2) Claimant.--The term ``claimant'' means any person who
brings a health care lawsuit, including a person who asserts
or claims a right to legal or equitable contribution,
indemnity or subrogation, arising out of a health care
liability claim or action, and any person on whose behalf
such a claim is asserted or such an action is brought,
whether deceased, incompetent, or a minor.
(3) Collateral source benefits.--The term ``collateral
source benefits'' means any amount paid or reasonably likely
to be paid in the future to or on behalf of the claimant, or
any service, product or other benefit provided or reasonably
likely to be provided in the future to or on behalf of the
claimant, as a result of the injury or wrongful death,
pursuant to--
(A) any State or Federal health, sickness, income-
disability, accident, or workers' compensation law;
(B) any health, sickness, income-disability, or accident
insurance that provides health benefits or income-disability
coverage;
(C) any contract or agreement of any group, organization,
partnership, or corporation to provide, pay for, or reimburse
the cost of medical, hospital, dental, or income disability
benefits; and
(D) any other publicly or privately funded program.
(4) Compensatory damages.--The term ``compensatory
damages'' means objectively verifiable monetary losses
incurred as a result of the provision of, use of, or payment
for (or failure to provide, use, or pay for) health care
services or medical products, such as past and future medical
expenses, loss of past and future earnings, cost of obtaining
domestic services, loss of employment, and loss of business
or employment opportunities, damages for physical and
emotional pain, suffering, inconvenience, physical
impairment, mental anguish, disfigurement, loss of enjoyment
of life, loss of society and companionship, loss of
consortium (other than loss of domestic service), hedonic
damages, injury to reputation, and all other nonpecuniary
losses of any kind or nature. Such term includes economic
damages and noneconomic damages, as such terms are defined in
this section.
(5) Contingent fee.--The term ``contingent fee'' includes
all compensation to any person or persons which is payable
only if a recovery is effected on behalf of one or more
claimants.
(6) Economic damages.--The term ``economic damages'' means
objectively verifiable monetary losses incurred as a result
of the provision of, use of, or payment for (or failure to
provide, use, or pay for) health care services or medical
products, such as past and future medical expenses, loss of
past and future earnings, cost of obtaining domestic
services, loss of employment, and loss of business or
employment opportunities.
(7) Health care goods or services.--The term ``health care
goods or services'' means any goods or services provided by a
health care institution, provider, or by any individual
working under the supervision of a health care provider, that
relates to the diagnosis, prevention, care, or treatment of
any human disease or impairment, or the assessment of the
health of human beings.
(8) Health care institution.--The term ``health care
institution'' means any entity licensed under Federal or
State law to provide health care services (including but not
limited to ambulatory surgical centers, assisted living
facilities, emergency medical services providers, hospices,
hospitals and hospital systems, nursing homes, or other
entities licensed to provide such services).
(9) Health care lawsuit.--The term ``health care lawsuit''
means any health care liability claim concerning the
provision of health care goods or services affecting
interstate commerce, or any health care liability action
concerning the provision of (or the failure to provide)
health care goods or services affecting interstate commerce,
brought in a State or Federal court or pursuant to an
alternative dispute resolution system, against a health care
provider or a health care institution regardless of the
theory of liability on which the claim is based, or the
number of claimants, plaintiffs, defendants, or other
parties, or the number of claims or causes of action, in
which the claimant alleges a health care liability claim.
(10) Health care liability action.--The term ``health care
liability action'' means a civil action brought in a State or
Federal Court or pursuant to an alternative dispute
resolution system, against a health care provider or a health
care institution regardless of the theory of liability on
which the claim is based, or the number of plaintiffs,
defendants, or other parties, or the number of causes of
action, in which the claimant alleges a health care liability
claim.
(11) Health care liability claim.--The term ``health care
liability claim'' means a demand by any person, whether or
not pursuant to ADR, against a health care provider or health
care institution, including third-party claims, cross-claims,
counter-claims, or contribution claims, which are based upon
the provision of, use of, or payment for (or the failure to
provide, use, or pay for) health care services, regardless of
the theory of liability on which the claim is based, or the
number of plaintiffs, defendants, or other parties, or the
number of causes of action.
(12) Health care provider.--
(A) In general.--The term ``health care provider'' means
any person (including but not limited to a physician (as
defined by section 1861(r) of the Social Security Act (42
U.S.C. 1395x(r)), registered nurse, dentist, podiatrist,
pharmacist, chiropractor, or optometrist) required by State
or Federal law to be licensed, registered, or certified to
provide health care services, and being either so licensed,
registered, or certified, or exempted from such requirement
by other statute or regulation.
(B) Treatment of certain professional associations.--For
purposes of this subpart, a professional association that is
organized under State law by an individual physician or group
of physicians, a partnership or limited liability partnership
formed by a group of physicians, a nonprofit health
corporation certified under State law, or a company formed by
a group of physicians under State law shall be treated as a
health care provider under subparagraph (A).
(13) Malicious intent to injure.--The term ``malicious
intent to injure'' means intentionally causing or attempting
to cause physical injury other than providing health care
goods or services.
(14) Noneconomic damages.--The term ``noneconomic damages''
means damages for physical and emotional pain, suffering,
inconvenience, physical impairment, mental anguish,
disfigurement, loss of enjoyment of life, loss of society and
companionship, loss of consortium (other than loss of
domestic service), hedonic damages, injury to reputation, and
all other nonpecuniary losses of any kind or nature.
(15) Punitive damages.--The term ``punitive damages'' means
damages awarded, for the purpose of punishment or deterrence,
and not solely for compensatory purposes, against a health
care provider or health care institution. Punitive damages
are neither economic nor noneconomic damages.
(16) Recovery.--The term ``recovery'' means the net sum
recovered after deducting any disbursements or costs incurred
in connection with prosecution or settlement of the claim,
including all costs paid or advanced by any person. Costs of
health care incurred by the plaintiff and the attorneys'
office overhead costs or charges for legal services are not
deductible disbursements or costs for such purpose.
(17) State.--The term ``State'' means each of the several
States, the District of Columbia, the Commonwealth of Puerto
Rico, the Virgin Islands, Guam, American Samoa, the Northern
Mariana Islands, the Trust Territory of the Pacific Islands,
and any other territory or possession of the United States,
or any political subdivision thereof.

SEC. 554. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS.

(a) In General.--Except as otherwise provided for in this
section, the time for the commencement of a health care
lawsuit shall be 3 years after the date of manifestation of
injury or 1 year after the claimant discovers, or through the
use of reasonable diligence should have discovered, the
injury, whichever occurs first.
(b) General Exception.--The time for the commencement of a
health care lawsuit shall not exceed 3 years after the date
of manifestation of injury unless the tolling of time was
delayed as a result of--
(1) fraud;
(2) intentional concealment; or
(3) the presence of a foreign body, which has no
therapeutic or diagnostic purpose or effect, in the person of
the injured person.
(c) Minors.--An action by a minor shall be commenced within
3 years from the date of the alleged manifestation of injury
except that if such minor is under the full age of 6 years,
such action shall be commenced within 3 years of the
manifestation of injury, or prior to the eighth birthday of
the minor, whichever provides a longer period. Such time
limitation shall be tolled for minors for any period during
which a parent or guardian and a health care provider or
health care institution have committed fraud or collusion in
the failure to bring an action on behalf of the injured
minor.
(d) Rule 11 Sanctions.--Whenever a Federal or State court
determines (whether by motion of the parties or whether on
the motion of the court) that there has been a violation of
Rule 11 of the Federal Rules of Civil Procedure (or a similar
violation of applicable State court rules) in a health care
liability action to which this subpart applies, the court
shall impose upon the attorneys, law firms, or pro se
litigants that have violated

[[Page S5133]]

Rule 11 or are responsible for the violation, an appropriate
sanction, which shall include an order to pay the other party
or parties for the reasonable expenses incurred as a direct
result of the filing of the pleading, motion, or other paper
that is the subject of the violation, including a reasonable
attorneys' fee. Such sanction shall be sufficient to deter
repetition of such conduct or comparable conduct by others
similarly situated, and to compensate the party or parties
injured by such conduct.

SEC. 555. COMPENSATING PATIENT INJURY.

(a) Unlimited Amount of Damages for Actual Economic Losses
in Health Care Lawsuits.--In any health care lawsuit, nothing
in this subpart shall limit the recovery by a claimant of the
full amount of the available economic damages,
notwithstanding the limitation contained in subsection (b).
(b) Additional Noneconomic Damages.--
(1) Health care providers.--In any health care lawsuit
where final judgment is rendered against a health care
provider, the amount of noneconomic damages recovered from
the provider, if otherwise available under applicable Federal
or State law, may be as much as $250,000, regardless of the
number of parties other than a health care institution
against whom the action is brought or the number of separate
claims or actions brought with respect to the same
occurrence.
(2) Health care institutions.--
(A) Single institution.--In any health care lawsuit where
final judgment is rendered against a single health care
institution, the amount of noneconomic damages recovered from
the institution, if otherwise available under applicable
Federal or State law, may be as much as $250,000, regardless
of the number of parties against whom the action is brought
or the number of separate claims or actions brought with
respect to the same occurrence.
(B) Multiple institutions.--In any health care lawsuit
where final judgment is rendered against more than one health
care institution, the amount of noneconomic damages recovered
from each institution, if otherwise available under
applicable Federal or State law, may be as much as $250,000,
regardless of the number of parties against whom the action
is brought or the number of separate claims or actions
brought with respect to the same occurrence, except that the
total amount recovered from all such institutions in such
lawsuit shall not exceed $500,000.
(c) No Discount of Award for Noneconomic Damages.--In any
health care lawsuit--
(1) an award for future noneconomic damages shall not be
discounted to present value;
(2) the jury shall not be informed about the maximum award
for noneconomic damages under subsection (b);
(3) an award for noneconomic damages in excess of the
limitations provided for in subsection (b) shall be reduced
either before the entry of judgment, or by amendment of the
judgment after entry of judgment, and such reduction shall be
made before accounting for any other reduction in damages
required by law; and
(4) if separate awards are rendered for past and future
noneconomic damages and the combined awards exceed the
limitations described in subsection (b), the future
noneconomic damages shall be reduced first.
(d) Fair Share Rule.--In any health care lawsuit, each
party shall be liable for that party's several share of any
damages only and not for the share of any other person. Each
party shall be liable only for the amount of damages
allocated to such party in direct proportion to such party's
percentage of responsibility. A separate judgment shall be
rendered against each such party for the amount allocated to
such party. For purposes of this section, the trier of fact
shall determine the proportion of responsibility of each
party for the claimant's harm.

SEC. 556. MAXIMIZING PATIENT RECOVERY.

(a) Court Supervision of Share of Damages Actually Paid to
Claimants.--
(1) In general.--In any health care lawsuit, the court
shall supervise the arrangements for payment of damages to
protect against conflicts of interest that may have the
effect of reducing the amount of damages awarded that are
actually paid to claimants.
(2) Contingency fees.--
(A) In general.--In any health care lawsuit in which the
attorney for a party claims a financial stake in the outcome
by virtue of a contingent fee, the court shall have the power
to restrict the payment of a claimant's damage recovery to
such attorney, and to redirect such damages to the claimant
based upon the interests of justice and principles of equity.
(B) Limitation.--The total of all contingent fees for
representing all claimants in a health care lawsuit shall not
exceed the following limits:
(i) 40 percent of the first $50,000 recovered by the
claimant(s).
(ii) 33\1/3\ percent of the next $50,000 recovered by the
claimant(s).
(iii) 25 percent of the next $500,000 recovered by the
claimant(s).
(iv) 15 percent of any amount by which the recovery by the
claimant(s) is in excess of $600,000.
(b) Applicability.--
(1) In general.--The limitations in subsection (a) shall
apply whether the recovery is by judgment, settlement,
mediation, arbitration, or any other form of alternative
dispute resolution.
(2) Minors.--In a health care lawsuit involving a minor or
incompetent person, a court retains the authority to
authorize or approve a fee that is less than the maximum
permitted under this section.
(c) Expert Witnesses.--
(1) Requirement.--No individual shall be qualified to
testify as an expert witness concerning issues of negligence
in any health care lawsuit against a defendant unless such
individual--
(A) except as required under paragraph (2), is a health
care professional who--
(i) is appropriately credentialed or licensed in 1 or more
States to deliver health care services; and
(ii) typically treats the diagnosis or condition or
provides the type of treatment under review; and
(B) can demonstrate by competent evidence that, as a result
of training, education, knowledge, and experience in the
evaluation, diagnosis, and treatment of the disease or injury
which is the subject matter of the lawsuit against the
defendant, the individual was substantially familiar with
applicable standards of care and practice as they relate to
the act or omission which is the subject of the lawsuit on
the date of the incident.
(2) Physician review.--In a health care lawsuit, if the
claim of the plaintiff involved treatment that is recommended
or provided by a physician (allopathic or osteopathic), an
individual shall not be qualified to be an expert witness
under this subsection with respect to issues of negligence
concerning such treatment unless such individual is a
physician.
(3) Specialties and subspecialties.--With respect to a
lawsuit described in paragraph (1), a court shall not permit
an expert in one medical specialty or subspecialty to testify
against a defendant in another medical specialty or
subspecialty unless, in addition to a showing of substantial
familiarity in accordance with paragraph (1)(B), there is a
showing that the standards of care and practice in the two
specialty or subspecialty fields are similar.
(4) Limitation.--The limitations in this subsection shall
not apply to expert witnesses testifying as to the degree or
permanency of medical or physical impairment.

SEC. 557. ADDITIONAL HEALTH BENEFITS.

(a) In General.--The amount of any damages received by a
claimant in any health care lawsuit shall be reduced by the
court by the amount of any collateral source benefits to
which the claimant is entitled, less any insurance premiums
or other payments made by the claimant (or by the spouse,
parent, child, or legal guardian of the claimant) to obtain
or secure such benefits.
(b) Preservation of Current Law.--Where a payor of
collateral source benefits has a right of recovery by
reimbursement or subrogation and such right is permitted
under Federal or State law, subsection (a) shall not apply.
(c) Application of Provision.--This section shall apply to
any health care lawsuit that is settled or resolved by a fact
finder.

SEC. 558. PUNITIVE DAMAGES.

(a) Punitive Damages Permitted.--
(1) In general.--Punitive damages may, if otherwise
available under applicable State or Federal law, be awarded
against any person in a health care lawsuit only if it is
proven by clear and convincing evidence that such person
acted with malicious intent to injure the claimant, or that
such person deliberately failed to avoid unnecessary injury
that such person knew the claimant was substantially certain
to suffer.
(2) Filing of lawsuit.--No demand for punitive damages
shall be included in a health care lawsuit as initially
filed. A court may allow a claimant to file an amended
pleading for punitive damages only upon a motion by the
claimant and after a finding by the court, upon review of
supporting and opposing affidavits or after a hearing, after
weighing the evidence, that the claimant has established by a
substantial probability that the claimant will prevail on the
claim for punitive damages.
(3) Separate proceeding.--At the request of any party in a
health care lawsuit, the trier of fact shall consider in a
separate proceeding--
(A) whether punitive damages are to be awarded and the
amount of such award; and
(B) the amount of punitive damages following a
determination of punitive liability.

If a separate proceeding is requested, evidence relevant only
to the claim for punitive damages, as determined by
applicable State law, shall be inadmissible in any proceeding
to determine whether compensatory damages are to be awarded.
(4) Limitation where no compensatory damages are awarded.--
In any health care lawsuit where no judgment for compensatory
damages is rendered against a person, no punitive damages may
be awarded with respect to the claim in such lawsuit against
such person.
(b) Determining Amount of Punitive Damages.--
(1) Factors considered.--In determining the amount of
punitive damages under this section, the trier of fact shall
consider only the following:
(A) the severity of the harm caused by the conduct of such
party;
(B) the duration of the conduct or any concealment of it by
such party;
(C) the profitability of the conduct to such party;
(D) the number of products sold or medical procedures
rendered for compensation, as the

[[Page S5134]]

case may be, by such party, of the kind causing the harm
complained of by the claimant;
(E) any criminal penalties imposed on such party, as a
result of the conduct complained of by the claimant; and
(F) the amount of any civil fines assessed against such
party as a result of the conduct complained of by the
claimant.
(2) Maximum award.--The amount of punitive damages awarded
in a health care lawsuit may not exceed an amount equal to
two times the amount of economic damages awarded in the
lawsuit or $250,000, whichever is greater. The jury shall not
be informed of the limitation under the preceding sentence.
(c) Liability of Health Care Providers.--
(1) In general.--A health care provider who prescribes, or
who dispenses pursuant to a prescription, a drug, biological
product, or medical device approved by the Food and Drug
Administration, for an approved indication of the drug,
biological product, or medical device, shall not be named as
a party to a product liability lawsuit invoking such drug,
biological product, or medical device and shall not be liable
to a claimant in a class action lawsuit against the
manufacturer, distributor, or product seller of such drug,
biological product, or medical device.
(2) Medical product.--The term ``medical product'' means a
drug or device intended for humans. The terms ``drug'' and
``device'' have the meanings given such terms in sections
201(g)(1) and 201(h) of the Federal Food, Drug and Cosmetic
Act (21 U.S.C. 321), respectively, including any component or
raw material used therein, but excluding health care
services.

SEC. 559. AUTHORIZATION OF PAYMENT OF FUTURE DAMAGES TO
CLAIMANTS IN HEALTH CARE LAWSUITS.

(a) In General.--In any health care lawsuit, if an award of
future damages, without reduction to present value, equaling
or exceeding $50,000 is made against a party with sufficient
insurance or other assets to fund a periodic payment of such
a judgment, the court shall, at the request of any party,
enter a judgment ordering that the future damages be paid by
periodic payments in accordance with the Uniform Periodic
Payment of Judgments Act promulgated by the National
Conference of Commissioners on Uniform State Laws.
(b) Applicability.--This section applies to all actions
which have not been first set for trial or retrial before the
effective date of this subpart.

SEC. 560. EFFECT ON OTHER LAWS.

(a) General Vaccine Injury.--
(1) In general.--To the extent that title XXI of the Public
Health Service Act establishes a Federal rule of law
applicable to a civil action brought for a vaccine-related
injury or death--
(A) this subpart shall not affect the application of the
rule of law to such an action; and
(B) any rule of law prescribed by this subpart in conflict
with a rule of law of such title XXI shall not apply to such
action.
(2) Exception.--If there is an aspect of a civil action
brought for a vaccine-related injury or death to which a
Federal rule of law under title XXI of the Public Health
Service Act does not apply, then this subpart or otherwise
applicable law (as determined under this subpart) will apply
to such aspect of such action.
(b) Smallpox Vaccine Injury.--
(1) In general.--To the extent that part C of title II of
the Public Health Service Act establishes a Federal rule of
law applicable to a civil action brought for a smallpox
vaccine-related injury or death--
(A) this subpart shall not affect the application of the
rule of law to such an action; and
(B) any rule of law prescribed by this subpart in conflict
with a rule of law of such part C shall not apply to such
action.
(2) Exception.--If there is an aspect of a civil action
brought for a smallpox vaccine-related injury or death to
which a Federal rule of law under part C of title II of the
Public Health Service Act does not apply, then this subpart
or otherwise applicable law (as determined under this
subpart) will apply to such aspect of such action.
(c) Other Federal Law.--Except as provided in this section,
nothing in this subpart shall be deemed to affect any defense
available, or any limitation on liability that applies to, a
defendant in a health care lawsuit or action under any other
provision of Federal law.

SEC. 561. STATE FLEXIBILITY AND PROTECTION OF STATES' RIGHTS.

(a) Health Care Lawsuits.--The provisions governing health
care lawsuits set forth in this subpart shall preempt,
subject to subsections (b) and (c), State law to the extent
that State law prevents the application of any provisions of
law established by or under this subpart. The provisions
governing health care lawsuits set forth in this subpart
supersede chapter 171 of title 28, United States Code, to the
extent that such chapter--
(1) provides for a greater amount of damages or contingent
fees, a longer period in which a health care lawsuit may be
commenced, or a reduced applicability or scope of periodic
payment of future damages, than provided in this subpart; or
(2) prohibits the introduction of evidence regarding
collateral source benefits.
(b) Preemption of Certain State Laws.--No provision of this
subpart shall be construed to preempt any State law (whether
effective before, on, or after the date of the enactment of
this subpart) that specifies a particular monetary amount of
compensatory or punitive damages (or the total amount of
damages) that may be awarded in a health care lawsuit,
regardless of whether such monetary amount is greater or
lesser than is provided for under this subpart,
notwithstanding section 555(a).
(c) Protection of State's Rights and Other Laws.--
(1) In general.--Any issue that is not governed by a
provision of law established by or under this subpart
(including the State standards of negligence) shall be
governed by otherwise applicable Federal or State law.
(2) Rule of construction.--Nothing in this subpart shall be
construed to--
(A) preempt or supersede any Federal or State law that
imposes greater procedural or substantive protections (such
as a shorter statute of limitations) for a health care
provider or health care institution from liability, loss, or
damages than those provided by this subpart;
(B) preempt or supercede any State law that permits and
provides for the enforcement of any arbitration agreement
related to a health care liability claim whether enacted
prior to or after the date of enactment of this subpart;
(C) create a cause of action that is not otherwise
available under Federal or State law; or
(D) affect the scope of preemption of any other Federal
law.

SEC. 562. APPLICABILITY; EFFECTIVE DATE.

This subpart shall apply to any health care lawsuit brought
in a Federal or State court, or subject to an alternative
dispute resolution system, that is initiated on or after the
date of the enactment of this subpart, except that any health
care lawsuit arising from an injury occurring prior to the
date of enactment of this subpart shall be governed by the
applicable statute of limitations provisions in effect at the
time the injury occurred.

TITLE VI--OTHER PROVISIONS

SEC. 601. EXTENSION OF NATIONAL FLOOD INSURANCE PROGRAM.

(a) Extension.--Section 129 of the Continuing
Appropriations Resolution, 2010 (Public Law 111-68), as
amended by section 7(a) of Public Law 111-157, is amended by
striking ``by substituting'' and all that follows through the
period at the end, and inserting ``by substituting December
31, 2010, for the date specified in each such section.''.
(b) Effective Date.--The amendments made by subsection (a)
shall be considered to have taken effect on May 31, 2010.

SEC. 602. SMALL BUSINESS LOAN GUARANTEE ENHANCEMENT
EXTENSIONS.

(a) Appropriation.--There is appropriated, out of any funds
in the Treasury not otherwise appropriated, for an additional
amount for ``Small Business Administration--Business Loans
Program Account'', $505,000,000, to remain available through
December 31, 2010, for the cost of--
(1) fee reductions and eliminations under section 501 of
division A of the American Recovery and Reinvestment Act of
2009 (Public Law 111-5; 123 Stat. 151), as amended by this
section; and
(2) loan guarantees under section 502 of division A of the
American Recovery and Reinvestment Act of 2009 (Public Law
111-5; 123 Stat. 152), as amended by this section.

Such costs, including the cost of modifying such loans, shall
be as defined in section 502 of the Congressional Budget Act
of 1974.
(b) Extension of Programs.--
(1) Fees.--Section 501 of division A of the American
Recovery and Reinvestment Act of 2009 (Public Law 111-5; 123
Stat. 151) is amended by striking ``September 30, 2010'' each
place it appears and inserting ``December 31, 2010''.
(2) Loan guarantees.--Section 502(f) of division A of the
American Recovery and Reinvestment Act of 2009 (Public Law
111-5; 123 Stat. 153) is amended by striking ``May 31, 2010''
and inserting ``December 31, 2010''.
(c) Appropriation.--There is appropriated for an additional
amount, out of any funds in the Treasury not otherwise
appropriated, for administrative expenses to carry out
sections 501 and 502 of division A of the American Recovery
and Reinvestment Act of 2009 (Public Law 111-5), $5,000,000,
to remain available until expended, which may be transferred
and merged with the appropriation for ``Small Business
Administration--Salaries and Expenses''.

SEC. 603. SUMMER EMPLOYMENT FOR YOUTH.

There is appropriated, out of any funds in the Treasury not
otherwise appropriated, for an additional amount for
``Department of Labor--Employment and Training
Administration--Training and Employment Services'' for
activities under the Workforce Investment Act of 1998
(``WIA''), $1,000,000,000 shall be available for obligation
on the date of enactment of this Act for grants to States for
youth activities, including summer employment for youth:
Provided, That no portion of such funds shall be reserved to
carry out section 127(b)(1)(A) of the WIA: Provided further,
That for purposes of section 127(b)(1)(C)(iv) of the WIA,
funds available for youth activities shall be allotted as if
the total amount available for youth activities in the fiscal
year does not exceed $1,000,000,000: Provided further, That
with respect to the youth activities provided with such
funds, section 101(13)(A) of the WIA shall be applied by
substituting ``age 24'' for ``age 21'': Provided further,
That the work readiness performance indicator described in
section 136(b)(2)(A)(ii)(I) of the WIA shall be

[[Page S5135]]

the only measure of performance used to assess the
effectiveness of summer employment for youth provided with
such funds: Provided further, That an amount that is not more
than 1 percent of such amount may be used for the
administration, management, and oversight of the programs,
activities, and grants carried out with such funds, including
the evaluation of the use of such funds: Provided further,
That funds available under the preceding proviso, together
with funds described in section 801(a) of division A of the
American Recovery and reinvestment Act of 2009 (Public Law
111-5), and funds provided in such Act under the heading
``Department of Labor-Departmental Management-Salaries and
Expenses'', shall remain available for obligation through
September 30, 2011.

SEC. 604. EXPANSION OF ELIGIBILITY FOR CONCURRENT RECEIPT OF
MILITARY RETIRED PAY AND VETERANS' DISABILITY
COMPENSATION TO INCLUDE ALL CHAPTER 61
DISABILITY RETIREES REGARDLESS OF DISABILITY
RATING PERCENTAGE OR YEARS OF SERVICE.

(a) Phased Expansion Concurrent Receipt.--Subsection (a) of
section 1414 of title 10, United States Code, is amended to
read as follows:
``(a) Payment of Both Retired Pay and Disability
Compensation.--
``(1) Payment of both required.--
``(A) In general.--Subject to subsection (b), a member or
former member of the uniformed services who is entitled for
any month to retired pay and who is also entitled for that
month to veterans' disability compensation for a qualifying
service-connected disability (in this section referred to as
a `qualified retiree') is entitled to be paid both for that
month without regard to sections 5304 and 5305 of title 38.
``(B) Applicability of full concurrent receipt phase-in
requirement.--During the period beginning on January 1, 2004,
and ending on December 31, 2013, payment of retired pay to a
qualified retiree is subject to subsection (c).
``(C) Phase-in exception for 100 percent disabled
retirees.--The payment of retired pay is subject to
subsection (c) only during the period beginning on January 1,
2004, and ending on December 31, 2004, in the case of the
following qualified retirees:
``(i) A qualified retiree receiving veterans' disability
compensation for a disability rated as 100 percent.
``(ii) A qualified retiree receiving veterans' disability
compensation at the rate payable for a 100 percent disability
by reason of a determination of individual unemployability.
``(D) Temporary phase-in exception for certain chapter 61
disability retirees; termination.--Subject to subsection (b),
during the period beginning on January 1, 2011, and ending on
September 30, 2012, subsection (c) shall not apply to a
qualified retiree described in subparagraph (B) or (C) of
paragraph (2).
``(2) Qualifying service-connected disability defined.--In
this section:
``(A) 50 percent rating threshold.--In the case of a member
or former member receiving retired pay under any provision of
law other than chapter 61 of this title, or under chapter 61
with 20 years or more of service otherwise creditable under
section 1405 or computed under section 12732 of this title,
the term `qualifying service-connected disability' means a
service-connected disability or combination of service-
connected disabilities that is rated as not less than 50
percent disabling by the Secretary of Veterans Affairs.
However, during the period specified in paragraph (1)(D),
members or former members receiving retired pay under chapter
61 with 20 years or more of creditable service computed under
section 12732 of this title, but not otherwise entitled to
retired pay under any other provision of this title, shall
qualify in accordance with subparagraphs (B) and (C).
``(B) Inclusion of members not otherwise entitled to
retired pay.--In the case of a member or former member
receiving retired pay under chapter 61 of this title, but who
is not otherwise entitled to retired pay under any other
provision of this title, the term `qualifying service-
connected disability' means a service-connected disability or
combination of service-connected disabilities that is rated
by the Secretary of Veterans Affairs at the disabling level
specified in one of the following clauses (which, subject to
paragraph (3), is effective on or after the date specified in
the applicable clause):
``(i) January 1, 2011, rated 100 percent, or a rate payable
at 100 percent by reason of individual unemployability or
rated 90 percent.
``(ii) January 1, 2012, rated 80 percent or 70 percent.
``(iii) January 1, 2013, rated 60 percent or 50 percent.
``(C) Elimination of rating threshold.--In the case of a
member or former member receiving retired pay under chapter
61 regardless of being otherwise eligible for retirement, the
term `qualifying service-connected disability' means a
service-connected disability or combination of service-
connected disabilities that is rated by the Secretary of
Veterans Affairs at the disabling level specified in one of
the following clauses (which, subject to paragraph (3), is
effective on or after the date specified in the applicable
clause):
``(i) January 1, 2014, rated 40 percent or 30 percent.
``(ii) January 1, 2015, any rating.
``(3) Limited duration.--Notwithstanding the effective date
specified in each clause of subparagraphs (B) and (C) of
paragraph (2), the clause--
``(A) shall apply only if the termination date specified in
paragraph (1)(D) would occur during or after the calendar
year specified in the clause; and
``(B) shall not apply beyond the termination date specified
in paragraph (1)(D).''.
(b) Conforming Amendment to Special Rules for Chapter 61
Disability Retirees.--Subsection (b) of such section is
amended to read as follows:
``(b) Special Rules for Chapter 61 Disability Retirees When
Eligibility Has Been Established for Such Retirees.--
``(1) General reduction rule.--The retired pay of a member
retired under chapter 61 of this title is subject to
reduction under sections 5304 and 5305 of title 38, but only
to the extent that the amount of the members retired pay
under chapter 61 of this title exceeds the amount of retired
pay to which the member would have been entitled under any
other provision of law based upon the member's service in the
uniformed services if the member had not been retired under
chapter 61 of this title.
``(2) Chapter 61 retirees not otherwise entitled to retired
pay.--
``(A) Before termination date.--If a member with a
qualifying service-connected disability (as defined in
subsection (a)(2)) is retired under chapter 61 of this title,
but is not otherwise entitled to retired pay under any other
provision of this title, and the termination date specified
in subsection (a)(1)(D) has not occurred, the retired pay of
the member is subject to reduction under sections 5304 and
5305 of title 38, but only to the extent that the amount of
the member's retired pay under chapter 61 of this title
exceeds the amount equal to 2\1/2\ percent of the member's
years of creditable service multiplied by the member's
retired pay base under section 1406(b)(1) or 1407 of this
title, whichever is applicable to the member.
``(B) After termination date.--Subsection (a) does not
apply to a member described in subparagraph (A) if the
termination date specified in subsection (a)(1)(D) has
occurred.''.
(c) Conforming Amendment to Full Concurrent Receipt Phase-
in.--Subsection (c) of such section is amended by striking
``the second sentence of''.
(d) Clerical Amendments.--
(1) Section heading.--The heading of such section is
amended to read as follows:

``Sec. 1414. Concurrent receipt of retired pay and veterans'
disability compensation''.

(2) Table of sections.--The table of sections at the
beginning of chapter 71 of such title is amended by striking
the item related to section 1414 and inserting the following
new item:

``1414. Concurrent receipt of retired pay and veterans' disability
compensation.''.

(e) Effective Date.--The amendments made by this section
shall take effect on January 1, 2011.

SEC. 605. EXTENSION OF USE OF 2009 POVERTY GUIDELINES.

Section 1012 of the Department of Defense Appropriations
Act, 2010 (Public Law 111-118), as amended by section 6 of
the Continuing Extension Act of 2010 (Public Law 111-157), is
amended--
(1) by striking ``before May 31, 2010''; and
(2) by inserting ``for 2011'' after ``until updated poverty
guidelines''.

SEC. 606. REFUNDS DISREGARDED IN THE ADMINISTRATION OF
FEDERAL PROGRAMS AND FEDERALLY ASSISTED
PROGRAMS.

(a) In General.--Subchapter A of chapter 65 of the Internal
Revenue Code of 1986 is amended by adding at the end the
following new section:

``SEC. 6409. REFUNDS DISREGARDED IN THE ADMINISTRATION OF
FEDERAL PROGRAMS AND FEDERALLY ASSISTED
PROGRAMS.

``(a) In General.--Notwithstanding any other provision of
law, any refund (or advance payment with respect to a
refundable credit) made to any individual under this title
shall not be taken into account as income, and shall not be
taken into account as resources for a period of 12 months
from receipt, for purposes of determining the eligibility of
such individual (or any other individual) for benefits or
assistance (or the amount or extent of benefits or
assistance) under any Federal program or under any State or
local program financed in whole or in part with Federal
funds.
``(b) Termination.--Subsection (a) shall not apply to any
amount received after December 31, 2010.''.
(b) Clerical Amendment.--The table of sections for such
subchapter is amended by adding at the end the following new
item:

``Sec. 6409. Refunds disregarded in the administration of Federal
programs and federally assisted programs.''.

(c) Effective Date.--The amendments made by this section
shall apply to amounts received after December 31, 2009.

SEC. 607. ARRA PLANNING AND REPORTING.

Section 1512 of the American Recovery and Reinvestment Act
of 2009 (Public Law 111-5; 123 Stat. 287) is amended--
(1) in subsection (d)--
(A) in the subsection heading, by inserting ``Plans and''
after ``Agency'';
(B) by striking ``Not later than'' and inserting the
following:

[[Page S5136]]

``(1) Definition.--In this subsection, the term `covered
program' means a program for which funds are appropriated
under this division--
``(A) in an amount that is--
``(i) more than $2,000,000,000; and
``(ii) more than 150 percent of the funds appropriated for
the program for fiscal year 2008; or
``(B) that did not exist before the date of enactment of
this Act.
``(2) Plans.--Not later than July 1, 2010, the head of each
agency that distributes recovery funds shall submit to
Congress and make available on the website of the agency a
plan for each covered program, which shall, at a minimum,
contain--
``(A) a description of the goals for the covered program
using recovery funds;
``(B) a discussion of how the goals described in
subparagraph (A) relate to the goals for ongoing activities
of the covered program, if applicable;
``(C) a description of the activities that the agency will
undertake to achieve the goals described in subparagraph (A);
``(D) a description of the total recovery funding for the
covered program and the recovery funding for each activity
under the covered program, including identifying whether the
activity will be carried out using grants, contracts, or
other types of funding mechanisms;
``(E) a schedule of milestones for major phases of the
activities under the covered program, with planned delivery
dates;
``(F) performance measures the agency will use to track the
progress of each of the activities under the covered program
in meeting the goals described in subparagraph (A), including
performance targets, the frequency of measurement, and a
description of the methodology for each measure;
``(G) a description of the process of the agency for the
periodic review of the progress of the covered program
towards meeting the goals described in subparagraph (A); and
``(H) a description of how the agency will hold program
managers accountable for achieving the goals described in
subparagraph (A).
``(3) Reports.--
``(A) In general.--Not later than''; and
(C) by adding at the end the following:
``(B) Reports on plans.--Not later than 30 days after the
end of the calendar quarter ending September 30, 2010, and
every calendar quarter thereafter during which the agency
obligates or expends recovery funds, the head of each agency
that developed a plan for a covered program under paragraph
(2) shall submit to Congress and make available on a website
of the agency a report for each covered program that--
``(i) discusses the progress of the agency in implementing
the plan;
``(ii) describes the progress towards achieving the goals
described in paragraph (2)(A) for the covered program;
``(iii) discusses the status of each activity carried out
under the covered program, including whether the activity is
completed;
``(iv) details the unobligated and unexpired balances and
total obligations and outlays under the covered program;
``(v) discusses--

``(I) whether the covered program has met the milestones
for the covered program described in paragraph (2)(E);
``(II) if the covered program has failed to meet the
milestones, the reasons why; and
``(III) any changes in the milestones for the covered
program, including the reasons for the change;

``(vi) discusses the performance of the covered program,
including--

``(I) whether the covered program has met the performance
measures for the covered program described in paragraph
(2)(F);
``(II) if the covered program has failed to meet the
performance measures, the reasons why; and
``(III) any trends in information relating to the
performance of the covered program; and

``(vii) evaluates the ability of the covered program to
meet the goals of the covered program given the performance
of the covered program.'';
(2) in subsection (f)--
(A) by striking ``Within 180 days'' and inserting the
following:
``(1) In general.--Within 180 days''; and
(B) by adding at the end the following:
``(2) Penalties.--
``(A) In general.--Subject to subparagraphs (B), (C), and
(D), the Attorney General may bring a civil action in an
appropriate United States district court against a recipient
of recovery funds from an agency that does not provide the
information required under subsection (c) or knowingly
provides information under subsection (c) that contains a
material omission or misstatement. In a civil action under
this paragraph, the court may impose a civil penalty on a
recipient of recovery funds in an amount not more than
$250,000. Any amounts received from a civil penalty under
this paragraph shall be deposited in the general fund of the
Treasury.
``(B) Notification.--
``(i) In general.--The head of an agency shall provide a
written notification to a recipient of recovery funds from
the agency that fails to provide the information required
under subsection (c). A notification under this subparagraph
shall provide the recipient with information on how to comply
with the necessary reporting requirements and notice of the
penalties for failing to do so.
``(ii) Limitation.--A court may not impose a civil penalty
under subparagraph (A) relating to the failure to provide
information required under subsection (c) if, not later than
31 days after the date of the notification under clause (i),
the recipient of the recovery funds provides the information.
``(C) Considerations.--In determining the amount of a
penalty under this paragraph for a recipient of recovery
funds, a court shall consider--
``(i) the number of times the recipient has failed to
provide the information required under subsection (c);
``(ii) the amount of recovery funds provided to the
recipient;
``(iii) whether the recipient is a government, nonprofit
entity, or educational institution; and
``(iv) whether the recipient is a small business concern
(as defined under section 3 of the Small Business Act (15
U.S.C. 632)), with particular consideration given to
businesses with not more than 50 employees.
``(D) Applicability.--This paragraph shall apply to any
report required to be submitted on or after the date of
enactment of this paragraph.
``(E) Nonexclusivity.--The imposition of a civil penalty
under this subsection shall not preclude any other criminal,
civil, or administrative remedy available to the United
States or any other person under Federal or State law.
``(3) Technical assistance.--Each agency distributing
recovery funds shall provide technical assistance, as
necessary, to assist recipients of recovery funds in
complying with the requirements to provide information under
subsection (c), which shall include providing recipients with
a reminder regarding each reporting requirement.
``(4) Public listing.--
``(A) In general.--Not later than 45 days after the end of
each calendar quarter, and subject to the notification
requirements under paragraph (2)(B), the Board shall make
available on the website established under section 1526 a
list of all recipients of recovery funds that did not provide
the information required under subsection (c) for the
calendar quarter.
``(B) Contents.--A list made available under subparagraph
(A) shall, for each recipient of recovery funds on the list,
include the name and address of the recipient, the
identification number for the award, the amount of recovery
funds awarded to the recipient, a description of the activity
for which the recovery funds were provided, and, to the
extent known by the Board, the reason for noncompliance.
``(5) Regulations and reporting.--
``(A) Regulations.--Not later than 90 days after the date
of enactment of this paragraph, the Attorney General, in
consultation with the Director of the Office of Management
and Budget and the Chairperson, shall promulgate regulations
regarding implementation of this section.
``(B) Reporting.--
``(i) In general.--Not later than July 1, 2010, and every 3
months thereafter, the Director of the Office of Management
and Budget, in consultation with the Chairperson, shall
submit to Congress a report on the extent of noncompliance by
recipients of recovery funds with the reporting requirements
under this section.
``(ii) Contents.--Each report submitted under clause (i)
shall include--

``(I) information, for the quarter and in total, regarding
the number and amount of civil penalties imposed and
collected under this subsection, sorted by agency and
program;
``(II) information on the steps taken by the Federal
Government to reduce the level of noncompliance; and
``(III) any other information determined appropriate by the
Director.''; and

(3) by adding at the end the following:
``(i) Termination.--The reporting requirements under this
section shall terminate on September 30, 2013.''.

TITLE VII--BUDGETARY PROVISIONS

SEC. 701. DETERMINATION OF BUDGETARY EFFECTS.

(a) In General.--The budgetary effects of this Act, for the
purpose of complying with the Statutory Pay-As-You-Go Act of
2010, shall be determined by reference to the latest
statement titled ``Budgetary Effects of PAYGO Legislation''
for this Act, submitted for printing in the Congressional
Record by the Chairman of the Senate Budget Committee,
provided that such statement has been submitted prior to the
vote on passage.
(b) Emergency Designation for Congressional Enforcement.--
In the House of Representatives, this Act, with the exception
of section 511, is designated as an emergency for purposes of
pay-as-you-go principles. In the Senate, this Act is
designated as an emergency requirement pursuant to section
403(a) of S. Con. Res. 13 (111th Congress), the concurrent
resolution on the budget for fiscal year 2010.
(c) Emergency Designation for Statutory PAYGO.--This Act,
with the exception of section 511, is designated as an
emergency requirement pursuant to section 4(g) of the
Statutory Pay-As-You-Go Act of 2010 (Public Law 111-139; 2
U.S.C. 933(g)).
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