H.R. 6377 would permit certain community newspapers to choose alternative minimum funding standards for the defined benefit pension plans that they maintain, effectively reducing the amounts they are required to contribute to those plans. Because employers can deduct pension fund contributions from taxable income, those smaller contributions would increase the newspapers’ taxable corporate income and thus increase federal revenues. Pension plans pay premiums to the Pension Benefit Guaranty Corporation (PBGC) that are based partly on the amount by which a plan is underfunded. Smaller contributions from employers would increase funding shortfalls and increase federal premium receipts, which are recorded as reductions in direct spending. As a result, CBO and the staff of the Joint Committee on Taxation (JCT) estimate that enacting the legislation would increase revenues by $13 million and reduce direct spending by $21 million over the 2019-2028 period.
Because enacting H.R. 6377 would affect direct spending and revenues, pay-as-you-go procedures apply.
CBO and JCT estimate that enacting H.R. 6377 would not increase net direct spending by more than $2.5 billion or on-budget deficits by more than $5 billion in any of the four consecutive 10-year periods beginning in 2029.
CBO and JCT have determined that H.R. 6377 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act.