HR 539 | U.S. House Bill | Preserving Our Promise to Seniors Act

HR 539

112th CONGRESS
1st Session

H. R. 539

To amend title II of the Social Security Act and the Internal Revenue Code of 1986 to make improvements in the old-age, survivors, and disability insurance program, to provide for cash relief for years for which annual COLAs do not take effect under certain cash benefit programs, and to provide for Social Security benefit protection.

IN THE HOUSE OF REPRESENTATIVES

February 8, 2011

Mr. DEUTCH (for himself, Mr. FRANK of Massachusetts, Mr. HASTINGS of Florida, Mr. CARNAHAN, Ms. PINGREE of Maine, and Mr. CRITZ) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Education and the Workforce, Rules, Transportation and Infrastructure, and Veterans' Affairs, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) Short Title- This Act may cited as the `Preserving Our Promise to Seniors Act'.

(b) Table of Contents- The table of contents of this Act is as follows:

Sec. 1. Short title and table of contents.

TITLE I--COST-OF-LIVING INCREASES

Sec. 101. Consumer price index for elderly consumers.

Sec. 102. Computation of cost-of-living increases.

TITLE II--GUARANTEED SUPPLEMENTAL PAYMENT

Sec. 201. Relief payments to recipients of social security, supplemental security income, railroad retirement benefits, and veterans disability compensation or pension benefits.

TITLE III--CONTRIBUTION AND BENEFIT FAIRNESS

Sec. 301. Determination of wages and self-employment income above contribution and benefit base after 2011.

Sec. 302. Inclusion of surplus earnings in social security benefit formula.

TITLE IV--SOCIAL SECURITY BENEFIT PROTECTION

Sec. 401. Point of order against privatization of Social Security or reductions in Social Security benefits.

TITLE I--COST-OF-LIVING INCREASES

SEC. 101. CONSUMER PRICE INDEX FOR ELDERLY CONSUMERS.

(a) In General- The Bureau of Labor Statistics of the Department of Labor shall prepare and publish an index for each calendar month to be known as the `Consumer Price Index for Elderly Consumers' that indicates changes over time in expenditures for consumption which are typical for individuals in the United States who are 62 years of age or older.

(b) Effective Date- Subsection (a) shall apply with respect to calendar months ending on or after July 31 of the calendar year following the calendar year in which this Act is enacted.

(c) Authorization of Appropriations- There are authorized to be appropriated such sums as are necessary to carry out the provisions of this section.

SEC. 102. COMPUTATION OF COST-OF-LIVING INCREASES.

(a) In General- Section 215(i) of the Social Security Act (42 U.S.C. 415(i)) is amended--

(1) in paragraph (1)(G), by inserting before the period the following: `, and, solely with respect to any monthly insurance benefit payable under this title to an individual who has attained age 62, effective for adjustments under this subsection to the primary insurance amount on which such benefit is based (or to any such benefit under section 227 or 228) occurring after such individual attains such age, the applicable Consumer Price Index shall be deemed to be the Consumer Price Index for Elderly Consumers and such primary insurance amount shall be deemed adjusted under this subsection using such Index'; and

(2) in paragraph (4), by striking `and by section 9001' and inserting `, by section 9001', and by inserting after `1986,' the following: `and by section 102 of the Preserving Our Promise to Seniors Act,'.

(b) Conforming Amendments in Applicable Former Law- Section 215(i)(1)(C) of such Act, as in effect in December 1978 and applied in certain cases under the provisions of such Act in effect after December 1978, is amended by inserting before the period the following: `, and, solely with respect to any monthly insurance benefit payable under this title to an individual who has attained age 62, effective for adjustments under this subsection to the primary insurance amount on which such benefit is based (or to any such benefit under section 227 or 228) occurring after such individual attains such age, the applicable Consumer Price Index shall be deemed to be the Consumer Price Index for Elderly Consumers and such primary insurance amount shall be deemed adjusted under this subsection using such Index'.

(c) Effective Date- The amendments made by subsection (a) shall apply to determinations made with respect to cost-of-living computation quarters (as defined in section 215(i)(1)(B) of the Social Security Act (42 U.S.C. 415(i)(1)(B))) ending on or after September 30 of the second calendar year following the calendar year in which this Act is enacted.

TITLE II--GUARANTEED SUPPLEMENTAL PAYMENT

SEC. 201. RELIEF PAYMENTS TO RECIPIENTS OF SOCIAL SECURITY, SUPPLEMENTAL SECURITY INCOME, RAILROAD RETIREMENT BENEFITS, AND VETERANS DISABILITY COMPENSATION OR PENSION BENEFITS.

(a) Authority To Make Payments-

(1) ELIGIBILITY-

(A) IN GENERAL- The Secretary of the Treasury shall disburse a cash payment equal to $250 (or such greater amount as may take effect under paragraph (2)), for each non-COLA year of a program providing benefit payments described in clause (i), (ii), or (iii) of subparagraph (C) or in subparagraph (D), to each individual who, for any month during such year, is entitled to such a benefit payment under such program.

(B) NON-COLA YEAR- For purposes of this section, the term `non-COLA year' means, in connection with a program referred to in subparagraph (A), a 12-month period, ending with or during any calendar year after 2009, for which--

(i) a cost-of-living adjustment is generally provided under such program in relation to an index; and

(ii) such an adjustment does not take effect by reason of the performance of such index.

(i) TITLE II BENEFIT- A benefit payment described in this clause is a monthly insurance benefit payable (without regard to sections 202(j)(1) and 223(b) of the Social Security Act (42 U.S.C. 402(j)(1), 423(b)) under--

(I) section 202(a) of such Act (42 U.S.C. 402(a));

(II) section 202(b) of such Act (42 U.S.C. 402(b));

(III) section 202(c) of such Act (42 U.S.C. 402(c));

(IV) section 202(d)(1)(B)(ii) of such Act (42 U.S.C. 402(d)(1)(B)(ii));

(V) section 202(e) of such Act (42 U.S.C. 402(e));

(VI) section 202(f) of such Act (42 U.S.C. 402(f));

(VII) section 202(g) of such Act (42 U.S.C. 402(g));

(VIII) section 202(h) of such Act (42 U.S.C. 402(h));

(IX) section 223(a) of such Act (42 U.S.C. 423(a));

(X) section 227 of such Act (42 U.S.C. 427); or

(XI) section 228 of such Act (42 U.S.C. 428).

(ii) RAILROAD RETIREMENT BENEFIT- A benefit payment described in this clause is a monthly annuity or pension payment payable (without regard to section 5(a)(ii) of the Railroad Retirement Act of 1974 (45 U.S.C. 231d(a)(ii))) under--

(I) section 2(a)(1) of such Act (45 U.S.C. 231a(a)(1));

(II) section 2(c) of such Act (45 U.S.C. 231a(c));

(III) section 2(d)(1)(i) of such Act (45 U.S.C. 231a(d)(1)(i));

(IV) section 2(d)(1)(ii) of such Act (45 U.S.C. 231a(d)(1)(ii));

(V) section 2(d)(1)(iii)(C) of such Act to an adult disabled child (45 U.S.C. 231a(d)(1)(iii)(C));

(VI) section 2(d)(1)(iv) of such Act (45 U.S.C. 231a(d)(1)(iv));

(VII) section 2(d)(1)(v) of such Act (45 U.S.C. 231a(d)(1)(v)); or

(VIII) section 7(b)(2) of such Act (45 U.S.C. 231f(b)(2)) with respect to any of the benefit payments described in clause (i) of this subparagraph.

(iii) VETERANS BENEFIT- A benefit payment described in this clause is a compensation or pension payment payable under--

(I) section 1110, 1117, 1121, 1131, 1141, or 1151 of title 38, United States Code;

(II) section 1310, 1312, 1313, 1315, 1316, or 1318 of title 38, United States Code;

(III) section 1513, 1521, 1533, 1536, 1537, 1541, 1542, or 1562 of title 38, United States Code; or

(IV) section 1805, 1815, or 1821 of title 38, United States Code,

to a veteran, surviving spouse, child, or parent as described in paragraph (2), (3), (4)(A)(ii), or (5) of section 101, title 38, United States Code, who received that benefit during any month within the 3 month period ending with the month which ends prior to the month that includes the date of the enactment of this Act.

(D) SSI CASH BENEFIT DESCRIBED- A SSI cash benefit described in this subparagraph is a cash benefit payable under section 1611 (other than under subsection (e)(1)(B) of such section) or 1619(a) of the Social Security Act (42 U.S.C. 1382, 1382h).

(2) COST-OF-LIVING ADJUSTMENT TO PAYMENT-

(A) IN GENERAL- Effective for each 12-month period referred to in paragraph (1)(B)(i) in connection with a program referred to in paragraph (1)(A) (irrespective of whether such period is a non-COLA year) ending with or during a calendar year after 2011, the dollar amount determined under this paragraph shall be substituted for the dollar amount specified in paragraph (1)(A). The dollar amount shall be determined by multiplying the dollar amount specified in paragraph (1)(A) by the quotient obtained by dividing--

(i) the Consumer Price Index for Elderly Consumers (published by the Bureau of Labor Statistics of the Department of Labor) for the calendar quarter ending with September preceding the 12-month period for which the determination is made, by

(ii) such Index for the calendar quarter ending with September 2010.

(B) DETERMINATION OF QUARTERLY INDEX- For purposes of subparagraph (A), the Consumer Price Index for Elderly Consumers for a calendar quarter shall be the arithmetical mean of such index for the 3 months in such quarter.

(3) REQUIREMENT- A payment shall be made under paragraph (1) only to individuals who reside in 1 of the 50 States, the District of Columbia, Puerto Rico, Guam, the United States Virgin Islands, American Samoa, or the Northern Mariana Islands. For purposes of the preceding sentence, the determination of the individual's residence shall be based on the current address of record under a program specified in paragraph (1).

(4) NO DOUBLE PAYMENTS- An individual shall be paid only 1 payment under this section, regardless of whether the individual is entitled to, or eligible for, more than 1 benefit or cash payment described in paragraph (1).

(5) LIMITATION- A payment under this section shall not be made--

(A) in the case of an individual entitled to a benefit specified in paragraph (1)(C)(i) or paragraph (1)(C)(ii)(VIII) if, for the most recent month of such individual's entitlement in the 3-month period described in paragraph (1), such individual's benefit under such paragraph was not payable by reason of subsection (x) or (y) of section 202 of the Social Security Act (42 U.S.C. 402) or section 1129A of such Act (42 U.S.C. 1320a-8a);

(B) in the case of an individual entitled to a benefit specified in paragraph (1)(C)(iii) if, for the most recent month of such individual's entitlement in the 3 month period described in paragraph (1), such individual's benefit under such paragraph was not payable, or was reduced, by reason of section 1505, 5313, or 5313B of title 38, United States Code;

(C) in the case of an individual entitled to a benefit specified in paragraph (1)(D) if, for such most recent month, such individual's benefit under such paragraph was not payable by reason of subsection (e)(1)(A) or (e)(4) of section 1611 (42 U.S.C. 1382) or section 1129A of such Act (42 U.S.C. 1320a-8a); or

(D) in the case of any individual whose date of death occurs before the date on which the individual is certified under subsection (b) to receive a payment under this section.

(6) TIMING AND MANNER OF PAYMENTS- The Secretary of the Treasury shall commence disbursing payments under this section with respect to a non-COLA year at the earliest practicable date but in no event later than 120 days after the later of the date of the enactment of this Act or the end of such non-COLA year. The Secretary of the Treasury may disburse any payment electronically to an individual in such manner as if such payment was a benefit payment or cash benefit to such individual under the applicable program described in subparagraph (C) or (D) of paragraph (1).

(b) Identification of Recipients- The Commissioner of Social Security, the Railroad Retirement Board, and the Secretary of Veterans Affairs shall certify the individuals entitled to receive payments under this section and provide the Secretary of the Treasury with the information needed to disburse such payments. A certification of an individual shall be unaffected by any subsequent determination or redetermination of the individual's entitlement to, or eligibility for, a benefit specified in subparagraph (C) or (D) of subsection (a)(1).

(1) PAYMENT TO BE DISREGARDED FOR PURPOSES OF ALL FEDERAL AND FEDERALLY ASSISTED PROGRAMS- A payment under subsection (a) shall not be regarded as income and shall not be regarded as a resource for the month of receipt and the following 9 months, for purposes of determining the eligibility of the recipient (or the recipient's spouse or family) 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.

(2) PAYMENT NOT CONSIDERED INCOME FOR PURPOSES OF TAXATION- A payment under subsection (a) shall not be considered as gross income for purposes of the Internal Revenue Code of 1986.

(3) PAYMENTS PROTECTED FROM ASSIGNMENT- The provisions of sections 207 and 1631(d)(1) of the Social Security Act (42 U.S.C. 407, 1383(d)(1)), section 14(a) of the Railroad Retirement Act of 1974 (45 U.S.C. 231m(a)), and section 5301 of title 38, United States Code, shall apply to any payment made under subsection (a) as if such payment was a benefit payment or cash benefit to such individual under the applicable program described in subparagraph (C) or (D) of subsection (a)(1).

(4) PAYMENTS SUBJECT TO OFFSET- Notwithstanding paragraph (3), for purposes of section 3716 of title 31, United States Code, any payment made under this section shall not be considered a benefit payment or cash benefit made under the applicable program described in subparagraph (C) or (D) of subsection (a)(1) and all amounts paid shall be subject to offset to collect delinquent debts.

(d) Payment to Representative Payees and Fiduciaries-

(1) IN GENERAL- In any case in which an individual who is entitled to a payment under subsection (a) and whose benefit payment or cash benefit described in paragraph (1) of that subsection is paid to a representative payee or fiduciary, the payment under subsection (a) shall be made to the individual's representative payee or fiduciary and the entire payment shall be used only for the benefit of the individual who is entitled to the payment.

(2) APPLICABILITY-

(A) PAYMENT ON THE BASIS OF A TITLE II OR SSI BENEFIT- Section 1129(a)(3) of the Social Security Act (42 U.S.C. 1320a-8(a)(3)) shall apply to any payment made on the basis of an entitlement to a benefit specified in paragraph (1)(C)(i) or (1)(D) of subsection (a) in the same manner as such section applies to a payment under title II or XVI of such Act.

(B) PAYMENT ON THE BASIS OF A RAILROAD RETIREMENT BENEFIT- Section 13 of the Railroad Retirement Act (45 U.S.C. 231l) shall apply to any payment made on the basis of an entitlement to a benefit specified in paragraph (1)(C)(ii) of subsection (a) in the same manner as such section applies to a payment under such Act.

(C) PAYMENT ON THE BASIS OF A VETERANS BENEFIT- Sections 5502, 6106, and 6108 of title 38, United States Code, shall apply to any payment made on the basis of an entitlement to a benefit specified in paragraph (1)(C)(iii) of subsection (a) in the same manner as those sections apply to a payment under that title.

(e) Appropriation- Out of any sums in the Treasury of the United States not otherwise appropriated, the following sums are appropriated for each fiscal year beginning on or after October 1, 2011, to remain available until expended, to carry out this section:

(1) For the Secretary of the Treasury, such sums as may be necessary for administrative costs incurred in carrying out this section.

(2) For the Commissioner of Social Security--

(A) such sums as may be necessary for payments to individuals certified by the Commissioner of Social Security as entitled to receive a payment under this section; and

(B) such sums as may be certified by the Commissioner to the Secretary of the Treasury for the Social Security Administration's Limitation on Administrative Expenses as necessary for administrative costs incurred in carrying out this section.

(3) For the Railroad Retirement Board--

(A) such sums as may be necessary for payments to individuals certified by the Railroad Retirement Board as entitled to receive a payment under this section; and

(B) such sums as may be certified by the Board to the Secretary of the Treasury for the Railroad Retirement Board's Limitation on Administration as necessary for administrative costs incurred in carrying out this section.

(4)(A) For the Secretary of Veterans Affairs--

(i) such sums as may be necessary for the Compensation and Pensions account, for payments to individuals certified by the Secretary of Veterans Affairs as entitled to receive a payment under this section; and

(ii) such sums as may be certified by the Secretary of Veterans Affairs to the Secretary of the Treasury for the Information Systems Technology account and for the General Operating Expenses account as necessary for administrative costs incurred in carrying out this section.

(B) The Department of Veterans Affairs Compensation and Pensions account shall hereinafter be available for payments authorized under subsection (a)(1)(A) to individuals entitled to a benefit payment described in subsection (a)(1)(C)(iii).

TITLE III--CONTRIBUTION AND BENEFIT FAIRNESS

SEC. 301. DETERMINATION OF WAGES AND SELF-EMPLOYMENT INCOME ABOVE CONTRIBUTION AND BENEFIT BASE AFTER 2011.

(a) Determination of Wages Above Contribution and Benefit Base After 2011-

(1) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986- Section 3121 of the Internal Revenue Code of 1986 is amended--

(A) in subsection (a)(1), by inserting `the applicable percentage (determined under subsection (c)(1)) of' before `that part of the remuneration'; and

(B) in subsection (c), by striking `(c) Included and Excluded Service- For purposes of this chapter, if' and inserting the following:

`(c) Special Rules for Wages and Employment-

`(1) APPLICABLE PERCENTAGE OF REMUNERATION IN DETERMINING WAGES- For purposes of paragraph (1) of subsection (a), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table:

--------------------------------------------------------

                          The applicable percentage is:

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Calendar year 2012                                  86%

Calendar year 2013                                  71%

Calendar year 2014                                  57%

Calendar year 2015                                  43%

Calendar year 2016                                  29%

Calendar year 2017                                  14%

Calendar years after 2017                           0%.

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`(2) INCLUDED AND EXCLUDED SERVICE- For purposes of this chapter, if'.

(2) AMENDMENTS TO THE SOCIAL SECURITY ACT- Section 209 of the Social Security Act (42 U.S.C. 409) is amended--

(A) in subsection (a)(1)(I)--

(i) by inserting `and before 2012' after `1974'; and

(ii) by inserting `and' after the semicolon;

(B) in subsection (a)(1), by adding at the end the following new subparagraph:

`(J) The applicable percentage (determined under subsection (l)) of that part of remuneration which, after remuneration (other than remuneration referred to in the succeeding subsections of this section) equal to the contribution and benefit base (determined under section 230) with respect to employment has been paid to an individual during any calendar year after 2011 with respect to which such contribution and benefit base is effective, is paid to such individual during such calendar year;'; and

`(l) For purposes of subparagraph (J) of subsection (a)(1), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table:

--------------------------------------------------------

                          The applicable percentage is:

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Calendar year 2012                                  86%

Calendar year 2013                                  71%

Calendar year 2014                                  57%

Calendar year 2015                                  43%

Calendar year 2016                                  29%

Calendar year 2017                                  14%

Calendar years after 2017                          0%'.

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(3) EFFECTIVE DATE- The amendments made by this subsection shall apply with respect to remuneration paid in calendar years after 2011.

(b) Determination of Self-Employment Income Above Contribution and Benefit Base After 2011-

(1) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986- Section 1402 of the Internal Revenue Code of 1986 is amended--

(A) in subsection (b)(1), by inserting `an amount equal to the applicable percentage (as determined under subsection (d)(2)) of' before `that part of the net earnings from self-employment'; and

(B) in subsection (d)--

(i) by striking `(d) Employee and Wages- The term' and inserting the following:

`(d) Rules and Definitions-

`(1) EMPLOYEE AND WAGES- The term'; and

(ii) by adding at the end the following:

`(2) APPLICABLE PERCENTAGE OF NET EARNINGS FROM SELF-EMPLOYMENT IN DETERMINING SELF-EMPLOYMENT INCOME- For purposes of paragraph (1) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph shall be the percentage determined in accordance with the following table:

--------------------------------------------------------

                          The applicable percentage is:

--------------------------------------------------------

Calendar year 2012                                  86%

Calendar year 2013                                  71%

Calendar year 2014                                  57%

Calendar year 2015                                  43%

Calendar year 2016                                  29%

Calendar year 2017                                  14%

Calendar years after 2017                          0%'.

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(2) AMENDMENTS TO THE SOCIAL SECURITY ACT- Section 211 of the Social Security Act (42 U.S.C. 411) is amended--

(A) in subsection (b)(1)(I)--

(i) by striking `or' after the semicolon; and

(ii) by inserting `and before 2012' after `1974';

(B) in subsection (b)--

(i) by redesignating paragraph (2) as paragraph (3); and

(ii) by inserting after paragraph (1) the following:

`(2) For any taxable year beginning in any calendar year after 2011, an amount equal to the applicable percentage (as determined under subsection (l)) of that part of net earnings from self-employment which is in excess of (A) an amount equal to the contribution and benefit base (determined under section 230) that is effective for such calendar year, minus (B) the amount of the wages paid to such individual during such taxable year; or'; and

`(l) For purposes of paragraph (2) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph, shall be the percentage determined in accordance with the following table:

--------------------------------------------------------

                          The applicable percentage is:

--------------------------------------------------------

Calendar year 2012                                  86%

Calendar year 2013                                  71%

Calendar year 2014                                  57%

Calendar year 2015                                  43%

Calendar year 2016                                  29%

Calendar year 2017                                  14%

Calendar years after 2017                          0%'.

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(3) EFFECTIVE DATE- The amendments made by this subsection shall apply with respect to taxable years beginning during or after calendar year 2012.

SEC. 302. INCLUSION OF SURPLUS EARNINGS IN SOCIAL SECURITY BENEFIT FORMULA.

(a) Inclusion of Surplus Average Indexed Monthly Earnings in Determination of Primary Insurance Amounts-

(1) IN GENERAL- Section 215(a)(1)(A) of the Social Security Act (42 U.S.C. 415(a)(1)(A)) is amended--

(A) in clauses (i), (ii), and (iii), by inserting `basic' before `average indexed monthly earnings' each place it appears;

(B) in clause (ii), by striking `and' at the end; and

`(iv) 3 percent of the individual's surplus average indexed monthly earnings to the extent such surplus average indexed monthly earnings do not exceed the excess of the amount established for purposes of this clause by subparagraph (B) over 1/12 of the contribution and benefit base for the last of such individual's computation base years, and

`(v) 0.25 percent of the sum of the individual's surplus average indexed monthly earnings plus 1/12 of the contribution and benefit base for the last of such individual's computation base years, to the extent such sum exceeds the amount established for purposes of clause (iv) by subparagraph (B).'.

(2) BEND POINT FOR SURPLUS EARNINGS- Section 215(a)(1)(B) of such Act (42 U.S.C. 415(a)(1)(B)) is amended--

(A) in clause (ii), by striking `the amounts so established' and inserting `the amounts established for purposes of clauses (i) and (ii) of subparagraph (A)';

(B) by redesignating clause (iii) as clause (v);

(D) by inserting after clause (ii) the following new clauses:

`(iii) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in the calendar year 2012, the amount established for purposes of clause (iv) of subparagraph (A) shall be $11,933.

`(iv) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2012, the amount established for purposes of clause (iv) of subparagraph (A) shall equal the product of the amount established with respect to the calendar year 2012 under clause (iii) of this subparagraph and the quotient obtained by dividing--

`(I) the national average wage index (as defined in section 209(k)(1)) for the second calendar year preceding the calendar year for which the determination is made, by

`(II) the national average wage index (as so defined) for 2010.'.

(b) Basic AIME and Surplus AIME-

(1) BASIC AIME- Section 215(b)(1) of such Act (42 U.S.C. 415(b)(1)) is amended--

(A) by inserting `basic' before `average'; and

(B) in subparagraph (A), by striking `paragraph (3)' and inserting `paragraph (3)(A)' and by inserting before the comma the following: `to the extent such total does not exceed the contribution and benefit base for the applicable year'.

(2) SURPLUS AIME-

(A) IN GENERAL- Section 215(b)(1) of such Act (as amended by paragraph (1)) is amended--

(i) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively;

(ii) by inserting `(A)' after `(b)(1)'; and

(iii) by adding at the end the following new subparagraph:

`(B)(i) An individual's surplus average indexed monthly earnings shall be equal to the quotient obtained by dividing--

`(I) the total (after adjustment under paragraph (3)(B)) of such individual's surplus earnings (determined under clause (ii)) for such individual's benefit computation years (determined under paragraph (2)), by

`(II) the number of months in those years.

`(ii) For purposes of clause (i) and paragraph (3)(B), an individual's surplus earnings for a benefit computation year are the total of such individual's wages paid in and self-employment income credited to such benefit computation year, to the extent such total (before adjustment under paragraph (3)(B)) exceeds the contribution and benefit base for such year.'.

(B) CONFORMING AMENDMENT- The heading for section 215(b) of such Act is amended by striking `Average Indexed Monthly Earnings' and inserting `Basic Average Indexed Monthly Earnings; Surplus Average Indexed Monthly Earnings'.

(3) ADJUSTMENT OF SURPLUS EARNINGS FOR PURPOSES OF DETERMINING SURPLUS AIME- Section 215(b)(3) of such Act (42 U.S.C. 415(b)(3)) is amended--

(A) in subparagraph (A), by striking `subparagraph (B)' and inserting `subparagraph (C)' and by inserting `and determination of basic average indexed monthly income' after `paragraph (2)';

(B) by redesignating subparagraph (B) as subparagraph (C); and

`(B) For purposes of determining under paragraph (1)(B) an individual's surplus average indexed monthly earnings, the individual's surplus earnings (described in paragraph (2)(B)(ii)) for a benefit computation year shall be deemed to be equal to the product of--

`(i) the individual's surplus earnings for such year (as determined without regard to this subparagraph), and

`(ii) the quotient described in subparagraph (A)(ii).'.

(c) Effective Date- The amendments made by this section shall apply with respect to individuals who initially become eligible (within the meaning of section 215(a)(3)(B) of the Social Security Act) for old-age or disability insurance benefits under title II of the Social Security Act, or who die (before becoming eligible for such benefits), in any calendar year after 2011.

TITLE IV--SOCIAL SECURITY BENEFIT PROTECTION

SEC. 401. POINT OF ORDER AGAINST PRIVATIZATION OF SOCIAL SECURITY OR REDUCTIONS IN SOCIAL SECURITY BENEFITS.

(a) In General- It shall not be in order in the House of Representatives or the Senate to consider any bill, joint resolution, amendment, motion, or conference report if the enactment of that bill or resolution, as reported, the adoption and enactment of that amendment, or the enactment of that bill or resolution in the form recommended in that conference report would have the effect of--

(1) establishing or maintaining a program--

(A) under which benefits under title II of the Social Security Act are reduced, in whole or in part, in connection with contributions made to individual accounts of beneficiaries under such title established or maintained in the private sector or in connection with returns on investment of amounts credited to such accounts, or

(B) which provides for administration of the old-age, survivors, and disability insurance program under such title, in whole or in part, by any entity in the private sector,

(2) otherwise reducing benefits under title II of the Social Security Act in the case of any present or future beneficiary below the level of such benefits that would be in effect without the enactment of such bill, resolution, or amendment, or

(3) providing for investment of amounts held in the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund in any investment vehicle other than interest-bearing obligations of the United States or obligations guaranteed as to both principal and interest by the United States.

(b) Waiver and Appeal- Subsection (a) may be waived or suspended in the Senate only by an affirmative vote of three-fifths of the Members, duly chosen and sworn. An affirmative vote of three-fifths of the Members of the Senate, duly chosen and sworn, shall be required in the Senate to sustain an appeal of the ruling of the Chair on a point of order raised under this section.

(1) as an exercise of the rulemaking power of the House of Representatives and the Senate and as such they shall be considered as part of the rules of each House or of that House to which they specifically apply, and these rules shall supersede other rules only to the extent that they are inconsistent with other such rules; and

(2) with full recognition of the constitutional right of either the House of Representatives or the Senate to change those rules at any time, in the same manner, and to the same extent as in the case of any other rule of the House of Representatives or the Senate.

END