WASHINGTON - Here's a good news/bad news scenario on U.S. pension plans.

First the good news: Congress is closing in on a sweeping new plan that would tighten rules for funding employee pension systems, and provide more money for the federal agency which insures pensions. The bad news: the new rules will likely move more firms away from providing traditional pension plans, which are quickly becoming extinct, anyway.

The Wall Street Journal said companies struggling to fund pension plans would be given seven years to get to 100 percent funding. The bill in Congress would tighten rules for how companies assess their ability to meet pension obligations - essentially stopping companies from making pension funding promises they can't keep.

The changes are designed to prevent companies from dumping unfunded pension obligations by companies onto the taxpayer-backed Pension Benefit Guarantee Corp., which assumes the obligations of firms which have filed for bankruptcy. The PBGC currently has a $22.8 billion deficit. However, Congress also doesn't want to send more firms into bankruptcy by instituting the new rules.

The Journal said older workers due a pension are expected to take the biggest hit: the rules allow firms to convert employees to cash balance plans, even though workers expect to be able to enjoy a defined benefit in their retirement years.

Multi-employer pension plans like those in the building trades - which don't have nearly the problems of single-employer plans - aren't likely to be affected if the law passes.