To amend the Internal Revenue Code of 1986 to provide special rules for the use of retirement funds in connection with federally declared disasters, to provide for certain regulatory relief in connection with federally declared disasters, and for other purposes.

SA 3373. Mr. LEE submitted an amendment intended to be proposed by
him to the bill H.R. 1, making appropriations for the Department of
Defense and the other departments and agencies of the Government for
the fiscal year ending September 30, 2011, and for other purposes;
which was ordered to lie on the table; as follows:

After section 1105, insert the following:

SEC. __. SPECIAL RULES FOR USE OF RETIREMENT FUNDS IN
CONNECTION WITH FEDERALLY DECLARED DISASTERS.

(a) Tax-favored Withdrawals From Retirement Plans.--
(1) In general.--Paragraph (2) of section 72(t) of the
Internal Revenue Code of 1986 is amended by adding at the end
the following new subparagraph:

[[Page S8145]]

``(H) Distributions from retirement plans in connection
with federally declared disasters.--Any qualified disaster
recovery distribution.''.
(2) Qualified disaster recovery distribution.--Section
72(t) of such Code is amended by adding at the end the
following new paragraph:
``(11) Qualified disaster recovery distribution.--For
purposes of paragraph (2)(H)--
``(A) In general.--Except as provided in subparagraph (B),
the term `qualified disaster recovery distribution' means,
with respect to any federally declared disaster, any
distribution from an eligible retirement plan made on or
after the applicable disaster date and before the date that
is 1 year after such date, to an individual whose principal
place of abode on the applicable disaster date, is located in
the disaster area and who has sustained an economic loss by
reason of such federally declared disaster.
``(B) Aggregate dollar limitation.--
``(i) In general.--For purposes of this subsection, the
aggregate amount of distributions received by an individual
which may be treated as qualified disaster recovery
distributions for any taxable year shall not exceed the
excess (if any) of--

``(I) $100,000, over
``(II) the sum of aggregate amounts treated as qualified
disaster recovery distributions received by such individual
for all prior taxable years, the aggregate amounts treated as
qualified hurricane distributions under section 1400Q(a), and
the aggregate amounts treated as qualified Disaster Recovery
Assistance distributions under section 701(d)(10) of the
Heartland Disaster Tax Relief Act of 2008.

``(ii) Treatment of plan distributions.--If a distribution
to an individual would (without regard to clause (i)) be a
qualified disaster recovery distribution, a plan shall not be
treated as violating any requirement of this title merely
because the plan treats such distribution as a qualified
disaster recovery distribution, unless the aggregate amount
of such distributions from all plans maintained by the
employer (and any member of any controlled group which
includes the employer) to such individual exceeds $100,000.
``(iii) Controlled group.--For purposes of clause (ii), the
term `controlled group' means any group treated as a single
employer under subsection (b), (c), (m), or (o) of section
414.
``(iv) Inflation adjustment.--In the case of any taxable
year beginning after 2012, each of the $100,000 amounts under
clauses (i) and (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 in which the taxable
year begins, determined by substituting `calendar year 2011'
for `calendar year 1992' in subparagraph (B) thereof.

If any amount as adjusted under the preceding sentence is not
a multiple of $10,000, such amount shall be rounded to the
next highest multiple of $10,000.
``(C) Amount distributed may be repaid.--
``(i) In general.--Any individual who receives a qualified
disaster recovery distribution may, at any time during the 3-
year period beginning on the day after the date on which such
distribution was received, make one or more contributions in
an aggregate amount not to exceed the amount of such
distribution to an eligible retirement plan of which such
individual is a beneficiary and to which a rollover
contribution of such distribution could be made under section
402(c), 403(a)(4), 403(b)(8), 408(d)(3), or 457(e)(16), as
the case may be.
``(ii) Treatment of repayments of distributions from
eligible retirement plans other than iras.--For purposes of
this title, if a contribution is made pursuant to clause (i)
with respect to a qualified disaster recovery distribution
from an eligible retirement plan other than an individual
retirement plan, then the taxpayer shall, to the extent of
the amount of the contribution, be treated as having received
the qualified disaster recovery distribution in an eligible
rollover distribution (as defined in section 402(c)(4)) and
as having transferred the amount to the eligible retirement
plan in a direct trustee to trustee transfer within 60 days
of the distribution.
``(iii) Treatment of repayments for distributions from
iras.--For purposes of this title, if a contribution is made
pursuant to clause (i) with respect to a qualified disaster
recovery distribution from an individual retirement plan (as
defined by section 7701(a)(37)), then, to the extent of the
amount of the contribution, the qualified disaster recovery
distribution shall be treated as a distribution described in
section 408(d)(3) and as having been transferred to the
eligible retirement plan in a direct trustee to trustee
transfer within 60 days of the distribution.
``(D) Income inclusion spread over 3-year period.--
``(i) In general.--In the case of any qualified disaster
recovery distribution, unless the taxpayer elects not to have
this paragraph apply for any taxable year, any amount
required to be included in gross income for such taxable year
shall be so included ratably over the 3-taxable year period
beginning with such taxable year.
``(ii) Special rule.--For purposes of clause (i), rules
similar to the rules of subparagraph (E) of section
408A(d)(3) shall apply.
``(E) Other definitions.--
``(i) Federally declared disaster; disaster area.--The
terms `federally declared disaster' and `disaster area' have
the meanings given such terms under section 165(h)(3)(C).
``(ii) Applicable disaster date.--The term `applicable
disaster date' means, with respect to any federally declared
disaster, the date on which such federally declared disaster
occurs.
``(iii) Eligible retirement plan.--The term `eligible
retirement plan' shall have the meaning given such term by
section 402(c)(8)(B).
``(F) Special rules.--
``(i) Exemption of distributions from trustee to trustee
transfer and withholding rules.--For purposes of sections
401(a)(31), 402(f), and 3405, qualified disaster recovery
distributions shall not be treated as eligible rollover
distributions.
``(ii) Qualified disaster recovery distributions treated as
meeting plan distribution requirements.--For purposes this
title, a qualified disaster recovery distribution shall be
treated as meeting the requirements of sections
401(k)(2)(B)(i), 403(b)(7)(A)(ii), 403(b)(11), and
457(d)(1)(A).''.
(3) Effective date.--The amendments made by this subsection
shall apply to distributions with respect to disaster
declared after December 31, 2011.
(b) Recontributions of Withdrawals for Home Purchases.--
(1) Individual retirement plans.--Paragraph (8) of section
72(t) of the Internal Revenue Code of 1986 is amended by
adding at the end the following new subparagraph:
``(F) Recontributions.--
``(i) General rule.--

``(I) In general.--Any individual who received a qualified
distribution may, during the applicable period, make one or
more contributions in an aggregate amount not to exceed the
amount of such qualified distribution to an eligible
retirement plan (as defined in section 402(c)(8)(B)) of which
such individual is a beneficiary and to which a rollover
contribution of such distribution could be made under section
402(c), 403(a)(4), 403(b)(8), or 408(d)(3), as the case may
be.
``(II) Treatment of repayments.--Rules similar to the rules
of clauses (ii) and (iii) of paragraph (11)(C) shall apply
for purposes of this subsection.

``(ii) Qualified distribution.--For purposes of this
subparagraph, the term `qualified distribution' means, with
respect to any federally declared disaster, any
distribution--

``(I) which is a qualified first-time homebuyer
distribution,
``(II) received on or after the date which is 6 months
before the applicable disaster date and before the date which
is the day after the applicable disaster date, and
``(III) which was to be used to purchase or construct a
principal residence in the disaster area, but which was not
so purchased or constructed on account of the federally
declared disaster.

``(iii) Applicable period.--For purposes of this
subparagraph, the term `applicable period' means the period
beginning on the applicable disaster date and ending on the
date which is 1 year after the applicable disaster date.
``(iv) Other definitions.--For purposes of this
subparagraph--

``(I) Federally declared disaster; disaster area.--The
terms `federally declared disaster' and `disaster area' have
the meanings given such terms under section 165(h)(3)(C).
``(II) Applicable disaster date.--The term `applicable
disaster date' means, with respect to any federally declared
disaster, the date on which such federally declared disaster
occurs.''.

(2) Qualified plans.--Subsection (c) of section 402 of the
Internal Revenue Code of 1986 is amended by adding at the end
the following new paragraph:
``(12) Recontributions of withdrawals for home purchases.--
``(A) General rule.--
``(i) In general.--Any individual who received a qualified
distribution may, during the applicable period, make one or
more contributions in an aggregate amount not to exceed the
amount of such qualified distribution to an eligible
retirement plan (as defined in paragraph (8)(B)) of which
such individual is a beneficiary and to which a rollover
contribution of such distribution could be made under
subsection (c) or section 403(a)(4), 403(b)(8), or 408(d)(3),
as the case may be.
``(ii) Treatment of repayments.--Rules similar to the rules
of clauses (ii) and (iii) of section 72(t)(11)(C) shall apply
for purposes of this subsection.
``(B) Qualified distribution.--For purposes of this
paragraph, the term `qualified distribution' means, with
respect to any federally declared disaster, any
distribution--
``(i) described in section 401(k)(2)(B)(i)(IV),
403(b)(7)(A)(ii) (but only to the extent such distribution
relates to financial hardship), or 403(b)(11)(B),
``(ii) received--

``(I) on or after the date which is 6 months before the
applicable disaster date, and
``(II) before the date which is the day after the
applicable disaster date, and

``(iii) which was to be used to purchase or construct a
principal residence in the disaster area, but which was not
so purchased or constructed on account of the federally
declared disaster.
``(C) Applicable period.--For purposes of this paragraph,
the term `applicable period'

[[Page S8146]]

means the period beginning on the applicable disaster date
and ending on the date which is 1 year after the applicable
disaster date.
``(D) Other definitions.--For purposes of this paragraph--
``(i) Federally declared disaster; disaster area.--The
terms `federally declared disaster' and `disaster area' have
the meanings given such terms under section 165(h)(3)(C).
``(ii) Applicable disaster date.--The term `applicable
disaster date' means, with respect to any federally declared
disaster, the date on which such federally declared disaster
occurs.''.
(3) Effective date.--The amendments made by this subsection
shall apply to distributions with respect to disaster
declared after December 31, 2011.
(c) Loans From Qualified Plans.--
(1) In general.--Subsection (p) of section 72 of the
Internal Revenue Code of 1986 is amended by adding at the end
the following new paragraph:
``(6) Increase in limit on loans not treated as
distributions.--
``(A) In general.--In the case of any loan from a qualified
employer plan to a qualified individual made during the
applicable period--
``(i) clause (i) of paragraph (2)(A) shall be applied by
substituting `$100,000' for `$50,000', and
``(ii) clause (ii) of such paragraph shall be applied by
substituting `the present value of the nonforfeitable accrued
benefit of the employee under the plan' for `one-half of the
present value of the nonforfeitable accrued benefit of the
employee under the plan'.
``(B) Delay of repayment.--In the case of a qualified
individual with an outstanding loan on or after the
applicable disaster date from a qualified employer plan--
``(i) if the due date pursuant to subparagraph (B) or (C)
of paragraph (2) for any repayment with respect to such loan
occurs during the period beginning on the applicable disaster
date and ending on the date which is 1 year after such date,
such due date shall be delayed for 1 year,
``(ii) any subsequent repayments with respect to any such
loan shall be appropriately adjusted to reflect the delay in
the due date under clause (i) and any interest accruing
during such delay, and
``(iii) in determining the 5-year period and the term of a
loan under subparagraph (B) or (C) of paragraph (2), the
period described in clause (i) shall be disregarded.
``(C) Inflation adjustment.--In the case of any taxable
year beginning after 2012, the $100,000 amounts under
subparagraph (A)(i)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 in which the taxable
year begins, determined by substituting `calendar year 2011'
for `calendar year 1992' in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not
a multiple of $10,000, such amount shall be rounded to the
next highest multiple of $10,000.
``(D) Definitions.--For purposes of this paragraph--
``(i) Qualified individual.--The term `qualified
individual' means, with respect to any federally declared
disaster, an individual whose principal place of abode on the
applicable disaster date is located in the disaster area and
who has sustained an economic loss by reason of such
federally declared disaster.
``(ii) Applicable period.--The applicable period is the
period beginning on the applicable disaster date and ending
on the date that is 1 year after such date.
``(iii) Federally declared disaster; disaster area.--The
terms `federally declared disaster' and `disaster area' have
the meanings given such terms under section 165(h)(3)(C).
``(iv) Applicable disaster date.--The term `applicable
disaster date' means, with respect to any federally declared
disaster, the date on which such federally declared disaster
occurs.''.
(2) Effective date.--The amendment made by this subsection
shall apply to loans made with respect to disaster declared
after December 31, 2011.
(d) Provisions Relating to Plan Amendments.--
(1) In general.--If this subsection applies to any
amendment to any plan or annuity contract, such plan or
contract shall be treated as being operated in accordance
with the terms of the plan during the period described in
paragraph (2)(B)(i).
(2) Amendments to which subsection applies.--
(A) In general.--This subsection shall apply to any
amendment to any plan or annuity contract which is made--
(i) pursuant to any provision of, or amendment made by,
this section, or pursuant to any regulation issued by the
Secretary or the Secretary of Labor under any provision of,
or amendment made by, this section, and
(ii) on or before the last day of the first plan year
beginning on or after January 1, 2014, or such later date as
the Secretary may prescribe.
In the case of a governmental plan (as defined in section
414(d)), clause (ii) shall be applied by substituting the
date which is 2 years after the date otherwise applied under
clause (ii).
(B) Conditions.--This subsection shall not apply to any
amendment unless--
(i) during the period--

(I) beginning on the date that the provisions of, and
amendments made by, this section or the regulation described
in subparagraph (A)(i) takes effect (or in the case of a plan
or contract amendment not required by the provisions of, or
amendments made by, this section or such regulation, the
effective date specified by the plan), and
(II) ending on the date described in subparagraph (A)(ii)
(or, if earlier, the date the plan or contract amendment is
adopted),

the plan or contract is operated as if such plan or contract
amendment were in effect; and
(ii) such plan or contract amendment applies retroactively
for such period.

SEC. __. INCREASED LIMITATION ON CHARITABLE CONTRIBUTIONS FOR
DISASTER RELIEF.

(a) Individuals.--Paragraph (1) of section 170(b) of the
Internal Revenue Code of 1986 is amended by redesignating
subparagraphs (F) and (G) as subparagraphs (G) and (H),
respectively, and by inserting after subparagraph (E) the
following new subparagraph:
``(F) Qualified disaster contributions.--
``(i) In general.--Any qualified disaster contribution
shall be allowed to the extent that the aggregate of such
contributions does not exceed the excess of 80 percent of the
taxpayer's contribution base over the amount of all other
charitable contributions allowable under this paragraph.
``(ii) Carryover.--If the aggregate amount of contributions
described in clause (i) exceeds the limitation under clause
(i), such excess shall be treated (in a manner consistent
with the rules of subsection (d)(1)) as a charitable
contribution to which clause (i) applies in each of the 5
succeeding years in order of time.
``(iii) Coordination with other subparagraphs.--For
purposes of applying this subsection and subsection (d)(1),
contributions described in clause (i) shall not be treated as
described in subparagraphs (A) and such subparagraph shall be
applied without regard to such contributions.
``(iv) Qualified disaster contributions.--For purposes of
this subparagraph, the term `qualified disaster contribution'
means any charitable contribution if--

``(I) such contribution is made after the date of the
enactment of this paragraph,
``(II) such contribution is made in cash to an organization
described in subparagraph (A) (other than an organization
described in section 509(a)(3)), and
``(III) such contribution is for relief efforts related to
a federally declared disaster (as defined in section
165(h)(3)(C)(i)).

Such term shall not include a contribution if the
contribution is for establishment of a new, or maintenance in
an existing, donor advised fund (as defined in section
4966(d)(2)).
``(v) Substantiation requirement.--This paragraph shall not
apply to any qualified disaster contribution unless the
taxpayer obtains from such organization to which the
contribution was made a contemporaneous written
acknowledgment (within the meaning of subsection (f)(8)) that
such contribution was used (or is to be used) for a purpose
described in clause (iv)(III).''.
(b) Corporations.--
(1) In general.--Paragraph (2) of section 170(b) of the
Internal Revenue Code of 1986 is amended by redesignating
subparagraph (C) as subparagraph (D) and by inserting after
subparagraph (B) the following new subparagraph:
``(C) Qualified disaster contributions.--
``(i) In general.--Any qualified disaster contribution
shall be allowed to the extent that the aggregate of such
contributions does not exceed the excess of 20 percent of the
taxpayer's taxable income over the amount of charitable
contributions allowed under subparagraph (A).
``(ii) Carryover.--If the aggregate amount of contributions
described in clause (i) exceeds the limitation under clause
(i), such excess shall be treated (in a manner consistent
with the rules of subsection (d)(1)) as a charitable
contribution to which clause (i) applies in each of the 5
succeeding years in order of time.
``(iii) Qualified disaster contribution.--The term
`qualified disaster contribution' has the meaning given such
term under paragraph (2)(F)(iv).
``(iv) Substantiation requirement.--This paragraph shall
not apply to any qualified disaster contribution unless the
taxpayer obtains from such organization to which the
contribution was made a contemporaneous written
acknowledgment (within the meaning of subsection (f)(8)) that
such contribution was used (or is to be used) for a purpose
described in paragraph (1)(F)(iv)(III).''.
(2) Conforming amendments.--
(A) Subparagraph (A) of section 170(b)(2) of such Code is
amended by striking ``subparagraph (B) applies'' and
inserting ``subparagraphs (B) and (C) apply''.
(B) Subparagraph (B) of section 170(b)(2) of such Code is
amended by striking ``subparagraph (A)'' and inserting
``subparagraphs (A) and (C)''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years ending after the date of the
enactment of this Act.

SEC. __. NONAPPLICATION OF DAVIS-BACON.

The wage-rate requirements of subchapter IV of chapter 31
of part A of subtitle II of title 40, United States Code
(commonly referred to as the ``Davis-Bacon Act'') shall not
apply with respect to any project or program carried out in
whole or in part with Federal funds in any Federally declared
disaster

[[Page S8147]]

area. This section shall apply to any project or program
contract entered into during the 1-year period beginning on
the date of disaster declaration involved.

SEC. __. MANDATORY POSTPONEMENT OF DEADLINES BY REASON OF
DISASTERS OR TERRORISTIC OR MILITARY ACTIONS.

(a) In General.--Section 7508A of the Internal Revenue Code
of 1986 is amended by striking ``may specify a period of up
to 1 year'' each place it appears in subsections (a) and (B)
and inserting ``shall specify a period of 1 year''.
(b) Conforming Amendments.--
(1) The heading for section 7508A of such Code is amended
by striking ``AUTHORITY TO POSTPONE'' and inserting
``POSTPONEMENT OF''.
(2) The item relating to section 7508A in the table of
sections for chapter 77 of such Code is amended by striking
``Authority to postpone'' and inserting ``Postponement of''.
(c) Effective Date.--The amendments made by this section
shall apply to disasters and terroristic or military actions
occurring on or after the date of the enactment of this Act.

SEC. __. TEMPORARY SUSPENSION OF BOUTIQUE FUEL REQUIREMENT
AND ETHANOL MANDATE.

(a) Boutique Fuel Requirement.--Section 211(c)(4)(C) of the
Clean Air Act (42 U.S.C. 7545(c)(4)(C)) is amended--
(1) by redesignating the second clause (v) (relating to the
authority of the Administrator to approve certain State
implementation plans) as clause (vi); and
(2) by adding at the end the following:
``(vii) Suspension.--The Administrator shall suspend a
control or prohibition respecting the use of a fuel or fuel
additive required or regulated by the Administrator pursuant
to this subsection for any area for which the President
declared a major disaster in accordance with section 401 of
the Robert T. Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5170) during the 90-day period
beginning on the date of the declaration.''.
(b) Ethanol Mandate.--Section 211(o)(7) of the Clean Air
Act (42 U.S.C. 7545(o)(7)) is amended by adding at the end
the following:
``(G) Suspension.--The Administrator shall suspend the
requirements of paragraph (2) for any area for which the
President declared a major disaster in accordance with
section 401 of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5170) during the 90-day
period beginning on the date of the declaration.''.

SEC. __. OTHER RELIEF.

Section 301 of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5141) is amended by
inserting ``at its own discretion or'' before ``if so
requested''.

SEC. __. WAIVER OF CERTAIN REQUIREMENTS FOR VESSELS IN
DISASTER AREAS.

Notwithstanding section 501 of title 46, United States
Code, during the 3-month period beginning on the date of the
enactment of this Act, the provisions of sections 55102 and
55103 of title 46, United States Code, shall not apply to a
vessel that is delivering merchandise or transporting
passengers to a port--
(1) in an area for which the President declared a disaster
under title IV of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5170 et seq.); or
(2) designated by the Secretary of Homeland Security as a
port of significant importance to an area referred to in
paragraph (1).
______