S. 2831

Governmental Pension Plan Equalization Act of 2004

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II

108th CONGRESS

2d Session

S. 2831

IN THE SENATE OF THE UNITED STATES

__________

Mr. Smith (for himself, Mr. Bingaman, Mr. Conrad, Mr. Daschle, Mr. Hatch, and Mr. Thomas) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 and the Employee Retirement Income Security Act of 1974 to clarify that federally recognized Indian tribal governments are to be regulated under the same government employer rules and procedures that apply to Federal, State, and other local government employers with regard to the establishment and maintenance of employee benefit plans.

1.

Short title

This Act may be cited as the Governmental Pension Plan Equalization Act of 2004.

2.

Clarification of governmental plan definitions

(a)

Amendment to Internal Revenue Code of 1986

Section 414(d) of the Internal Revenue Code of 1986 (definition of governmental plan) is amended by adding at the end thereof the following new sentence: The term governmental plan also includes a plan established or maintained for its employees by an Indian tribal government (as defined in section 7701(a)(40)), a subdivision of an Indian tribal government (determined in accordance with section 7871(d)), an agency or instrumentality of an Indian tribal government or a subdivision thereof, or an entity established under tribal, Federal, or State law which is wholly owned or controlled by any of the foregoing..

(b)

Amendment to Employee Retirement Income Security Act of 1974

Section 3(32) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(32)) is amended by adding at the end the following new sentence: The term governmental plan also includes a plan established or maintained for its employees by an Indian tribal government (as defined in section 7701(a)(40) of the Internal Revenue Code of 1986), a subdivision of an Indian tribal government (determined in accordance with section 7871(d) of such Code), an agency or instrumentality of an Indian tribal government or subdivision thereof, or an entity established under tribal, Federal, or State law which is wholly owned or controlled by any of the foregoing..

3.

Extension to all governmental plans of current moratorium on application of certain nondiscrimination rules applicable to State and local plans

(a)

In general

(1)

Subparagraph (G) of section 401(a)(5) and subparagraph (H) of section 401(a)(26) of the Internal Revenue Code of 1986 are each amended by striking section 414(d)) and all that follows and inserting section 414(d))..

(2)

Subparagraph (G) of section 401(k)(3) of such Code and paragraph (2) of section 1505(d) of the Taxpayer Relief Act of 1997 are each amended by striking maintained by a State or local government or political subdivision thereof (or agency or instrumentality thereof).

(b)

Conforming amendments

(1)

The heading for section 401(a)(5)(G) of such Code is amended to read as follows:

(G)

Governmental plans

.

(2)

The heading for section 401(a)(26)(H) of such Code is amended to read as follows:

(H)

Exception for governmental plans

.

(3)

Section 401(k)(3)(G) of such Code is amended by inserting Governmental plan.— after (G).

4.

Clarification that tribal governments are subject to the same defined benefit plan rules and regulations applied to State and other local governments, their police and firefighters

(a)

Amendments to Internal Revenue Code of 1986

(1)

Police and firefighters

Subparagraph (H) section 415(b)(2) of the Internal Revenue Code of 1986 (defining participant) is amended—

(A)

in clause (i) by inserting , Indian tribal government (as defined in section 7701(a)(40)), after State, and

(B)

in clause (ii)(I) by inserting , Indian tribal government, after State both places it appears.

(2)

State and local government plans

(A)

In general

Subparagraph (A) of section 415(b)(10) of such Code (relating to limitation to equal accrued benefit) is amended by inserting , Indian tribal government (as defined in section 7701(a)(40)), after State.

(B)

Conforming amendment

The heading for section 415(b)(10) of such Code is amended to read as follows:

(10)

Special rule for State, Indian tribal, and local government plans

.

(3)

Government pick up contributions

Paragraph (2) of section 414(h) of such Code (relating to designation by units of government) is amended by inserting , Indian tribal government (as defined in section 7701(a)(40)), after State.

(b)

Amendments to Employee Retirement Income Security Act of 1974

Section 4021(b)of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1321(b)) is amended—

(1)

in paragraph (12), by striking or at the end;

(2)

in paragraph (13), by striking plan. and inserting plan; or; and

(3)

by adding at the end the following new paragraph:

(14)

established and maintained for its employees by an Indian tribal government (as defined in section 7701(a)(40) of the Internal Revenue Code of 1986), a subdivision of an Indian tribal government (determined in accordance with section 7871(d) of such Code), an agency or instrumentality of an Indian tribal government or subdivision thereof, or an entity established under tribal, Federal, or State law which is wholly owned or controlled by any of the foregoing.

.

5.

Effective date

The amendments made by this Act shall apply to years beginning before, on, or after the date of the enactment of this Act.