Page:United States Statutes at Large Volume 120.djvu/953

 120 STAT. 922

PUBLIC LAW 109–280—AUG. 17, 2006

TITLE IV—PBGC GUARANTEE AND RELATED PROVISIONS SEC. 401. PBGC PREMIUMS.

(a) VARIABLE-RATE PREMIUMS.— (1) CONFORMING AMENDMENTS RELATED TO FUNDING RULES FOR SINGLE-EMPLOYER PLANS.—Section 4006(a)(3)(E) of the Employee Retirement Income and Security Act of 1974 (29 U.S.C. 1306(a)(3)(E)) is amended by striking clauses (iii) and (iv) and inserting the following: ‘‘(iii) For purposes of clause (ii), the term ‘unfunded vested benefits’ means, for a plan year, the excess (if any) of— ‘‘(I) the funding target of the plan as determined under section 303(d) for the plan year by only taking into account vested benefits and by using the interest rate described in clause (iv), over ‘‘(II) the fair market value of plan assets for the plan year which are held by the plan on the valuation date. ‘‘(iv) The interest rate used in valuing benefits for purposes of subclause (I) of clause (iii) shall be equal to the first, second, or third segment rate for the month preceding the month in which the plan year begins, which would be determined under section 303(h)(2)(C) if section 303(h)(2)(D) were applied by using the monthly yields for the month preceding the month in which the plan year begins on investment grade corporate bonds with varying maturities and in the top 3 quality levels rather than the average of such yields for a 24-month period.’’. (2) EFFECTIVE DATE.—The amendments made by paragraph (1) shall apply with respect to plan years beginning after 2007. (b) TERMINATION PREMIUMS.— (1) REPEAL OF SUNSET PROVISION.—Subparagraph (E) of section 4006(a)(7) of such Act is repealed. (2) TECHNICAL CORRECTION.— (A) IN GENERAL.—Section 4006(a)(7)(C)(ii) of such Act is amended by striking ‘‘subparagraph (B)(i)(I)’’ and inserting ‘‘subparagraph (B)’’. (B) EFFECTIVE DATE.—The amendment made by this paragraph shall take effect as if included in the provision of the Deficit Reduction Act of 2005 to which it relates.

29 USC 1306 note.

29 USC 1306 note. 26 USC 430 note.

SEC. 402. SPECIAL FUNDING RULES FOR CERTAIN PLANS MAINTAINED BY COMMERCIAL AIRLINES.

(a) IN GENERAL.—The plan sponsor of an eligible plan may elect to either— (1) have the rules of subsection (b) apply, or (2) have section 303 of the Employee Retirement Income Security Act of 1974 and section 430 of the Internal Revenue Code of 1986 applied to its first taxable year beginning in 2008 by amortizing the shortfall amortization base for such taxable year over a period of 10 plan years (rather than 7 plan years) beginning with such plan year. (b) ALTERNATIVE FUNDING SCHEDULE.— (1) IN GENERAL.—If an election is made under subsection (a)(1) to have this subsection apply to an eligible plan and the requirements of paragraphs (2) and (3) are met with respect to the plan—

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