[Congressional Record Volume 150, Number 83 (Wednesday, June 16, 2004)]
[Senate]
[Pages S6902-S6905]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRAHAM of Florida:
  S. 2534. A bill to amend title 38, United States Code, to extend and 
enhance benefits under the Montgomery GI Bill, to improve housing 
benefits for veterans, and for other purposes; to the Committee on 
Veterans' Affairs.
  Mr. GRAHAM of Florida. Mr. President, as Ranking Member of the 
Committee on Veterans' Affairs, I urge my colleagues to support the 
legislation I

[[Page S6903]]

introduce today, the proposed ``G.I. Bill for the 21st Century,'' a 
bill to improve home-buying and education options for America's 
veterans.
  We have reached a milestone in American history. The pending measure 
is a fitting tribute to our nation's veterans as we celebrate the 60th 
anniversary of the Servicemen's Readjustment Act of 1944, better known 
as the ``G.I. Bill.'' The G.I. Bill, for veterans of World War II, is 
recognized as one of the most important acts of Congress.
  The G.I. Bill ensured that all who sacrificed through service would 
not be penalized as a result of their war service and upon their return 
would be aided in reaching the positions which they might have occupied 
had their lives not been interrupted by war. This legendary piece of 
legislation alleviated postwar troubles and anticipated economic 
depression. During the past six decades, this government has invested 
billions of dollars in education and training for veterans. America has 
received a return on its investments many times over, resulting in a 
better educated, better trained, and dramatically changed society. In 
fact, many Members of this Senate have benefited from its far-reaching 
impact. In addition to its provisions for education and training, the 
G.I. Bill allowed millions of veterans the opportunity to purchase 
homes, transforming the majority of Americans from renters to 
homeowners.
  The G.I. Bill not only eased the transition of servicemen and women 
back into civilian life, it transformed American society. The social 
and economic class structure of the United States was forever changed 
and the boundaries that once encompassed class status were blurred. The 
bill expanded opportunities for lower- and middle-class families to own 
their own homes and to attend college. This expansion led to the 
evolution of the higher education system and paved the way for future 
individuals from all cultural and economic backgrounds to have access 
to higher education. The 7.8 million men and women who used their G.I. 
Bill benefits cultivated a new and progressive workforce that placed 
more people in professional career roles, especially in critical-need 
areas such as education, engineering, and health care.
  We must continue to ensure that veterans' education benefits change 
to meet the needs of veterans and their families who use them. We 
should continue with the original intent of the G.I. Bill to increase 
the ability of our veterans to acquire higher education. We have 
servicemembers fighting the war on terrorism world-wide and a whole new 
generation of combat veterans being created, as was the situation 
during World War II. We should make every effort to accommodate the 
educational needs of our veterans, and these changes to the Montgomery 
G.I. Bill, known as MGIB, are an important step in doing so.
  ``The G.I. Bill for the 21st Century'' would exclude MGIB benefits 
from computation as income when calculating campus-based student 
financial aid, such as Perkins Loans. This, importantly, draws the 
distinction between a benefit that has been earned, and paid for, by 
the veteran, and other types of income. This end is furthered by 
allowing the individual applying for financial aid to subtract $1200 
from the expected family contribution. This $1200 represents the money 
that the individual paid to participate in the MGIB program. Clearly it 
should not be counted as part of the veteran's income to pay for 
school. This legislation is in keeping with legislation that I 
introduced, and that became law, in 1998 that excluded veterans 
education benefits from being considered as income in the computation 
of some forms of financial aid.
  This legislation also offers an opportunity for enrollment in the 
MGIB education program for servicemembers who participated in or were 
eligible to participate in the post-Vietnam era educational assistance 
program, known as VEAP. Congress created an enrollment window for VEAP-
eligible servicemembers to convert to the far more comprehensive MGIB. 
However, some servicemembers were not able to participate because of 
financial reasons or did not learn of the enrollment period in time to 
make the deadline. These individuals have contacted Members of Congress 
to create another window. As my colleagues know, education can be the 
key to a successful transition to civilian life. This bill creates a 
one-year window and requires the servicemember to pay $2700, which was 
the VEAP contribution.
  I have spoken with many veterans and widows of veterans who were not 
able to immediately go to school. By the time they enrolled, their 
benefits were expiring. That is why this legislation maintains the 10-
year delimiting period for veterans, surviving spouses, and dependents 
that enroll in training programs, which does not begin to toll until 
the individual begins the program of study. This would allow eligible 
participants to utilize the benefit when best for them.
  In keeping with my commitment to evolve the educational assistance 
benefit to meet the needs of those using it, the bill that I introduce 
today would make national admissions exams such as the SAT, GRE, LSAT 
and GMAT, and national exams for credit at institutions of higher 
education, such as the AP exam covered by MGIB. This would greatly aid 
the individuals who have been absent from an academic setting for a 
long period of time and would go a long way in preparing them for their 
educational endeavors.
  As we face the greatest mobilization of troops since World War II, it 
is only fitting that we act in the spirit of the G.I. Bill to 
dramatically increase the ability of our veterans and their families to 
buy homes in competitive housing markets throughout the nation. This 
bill would change the method by which Congress establishes the maximum 
amount veterans may borrow through the VA home loan guaranty program.
  This legislation would index the maximum VA guaranty loan amount at 
100 percent of the Freddie Mac conforming loan limit. Under the current 
system, a specific dollar figure for the VA maximum loan amount is set 
by legislation. The maximum loan limit has not been changed since 2001. 
The current maximum guaranty is $60,000, which allows veterans to 
secure loans to purchase homes costing up to $240,000. Since that time, 
the Freddie Mac conforming loan rate has increased by over 18 percent. 
Sadly, the VA loan limit has not kept pace and currently represents 
only 74 percent of the Freddie Mac conforming loan limit. The change 
would also allow for annual adjustments to the amounts available to 
veterans, without annual legislation, ensuring that the VA home loan 
guaranty benefit remain viable in competitive housing markets.
  In 1999, Congress passed legislation that changed the Federal Housing 
Administration (FHA) Loan Program and permanently indexed FHA loans at 
87 percent of the Freddie Mac conforming loan limit. Why should we 
penalize the buying power of our veterans by maintaining a system that 
has failed to keep pace with annual increases in housing costs 
throughout the United States? To recognize this service and sacrifice, 
it only seems right that the loan limit available to veterans be set at 
a higher rate than the FHA limit. By indexing the VA loan limit at 100 
percent, the current VA maximum loan amount would increase from 
$240,000 to $333,700 and give our veterans greater buying power in a 
national housing market where the cost of a home continues to rise.
  In addition, the Congressional Budget Office, known as CBO, has 
informally projected that from 2005 to 2009 this increase will help 
over 10,000 new buyers participate in the VA Loan Guaranty Program. The 
Budget Office has also projected that the increase in new veteran 
buyers would generate savings of more than $200 million over the next 
five years. These savings will then be passed on to our veterans in the 
form of increased education and training opportunities.
  We must fight to ensure that veterans' education benefits are as 
flexible as those who left their homes and served freedom around the 
globe at their country's call to service. And, in keeping with the 
original intent of the G.I. Bill, raising the VA home loan guaranty 
limit would help more veterans realize the American dream of owning a 
home of their own. I urge my colleagues to join me in supporting these 
worthwhile efforts.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

[[Page S6904]]

                                S. 2534

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Montgomery GI Bill for the 
     21st Century Act''.

     SEC. 2. EXCLUSION OF BASIC PAY CONTRIBUTIONS FOR 
                   PARTICIPATION IN BASIC EDUCATIONAL ASSISTANCE 
                   IN CERTAIN COMPUTATIONS ON STUDENT FINANCIAL 
                   AID.

       (a) Exclusion.--Subchapter II of chapter 30 of title 38, 
     United States Code, is amended by adding at the end the 
     following new section:

     ``Sec. 3020A. Exclusion of basic pay contributions in certain 
       computations on student financial aid

       ``(a) In General.--The expected family contribution 
     computed under section 475, 476, or 477 of the Higher 
     Education Act of 1965 (20 U.S.C. 1087oo, 1087pp, 1087qq) for 
     a covered student shall be decreased by $1,200 for the 
     applicable year.
       ``(b) Definitions.--In this section:
       ``(1) The term `academic year' has the meaning given the 
     term in section 481(a)(2) of the Higher Education Act of 1965 
     (20 U.S.C. 1088(a)(2)).
       ``(2) The term `applicable year' means the first academic 
     year for which a student uses entitlement to basic 
     educational assistance under this chapter.
       ``(3) The term `covered student' means any individual 
     entitled to basic educational assistance under this chapter 
     whose basic pay or voluntary separation incentives was or 
     were subject to reduction under section 3011(b), 3012(c), 
     3018(c), 3018A(b), or 3018B(b) of this title.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of such chapter is amended by inserting after the 
     item relating to section 3020 the following new item:

``3020A. Exclusion of basic pay contributions in certain computations 
              on student financial aid.''.

     SEC. 3. OPPORTUNITY FOR ENROLLMENT IN BASIC EDUCATIONAL 
                   ASSISTANCE PROGRAM OF CERTAIN INDIVIDUALS WHO 
                   PARTICIPATED OR WERE ELIGIBLE TO PARTICIPATE IN 
                   POST-VIETNAM ERA VETERANS EDUCATIONAL 
                   ASSISTANCE PROGRAM.

       (a) Opportunity for Enrollment.--Section 3018C(e) of title 
     38, United States Code, is amended--
       (1) in paragraph (1), by inserting ``or (3)'' after 
     ``paragraph (2)'';
       (2) by redesignating paragraphs (3), (4), and (5) as 
     paragraphs (4), (5), and (6), respectively;
       (3) by inserting after paragraph (2) the following new 
     paragraph (3):
       ``(3) A qualified individual referred to in paragraph (1) 
     is also an individual who meets each of the following 
     requirements:
       ``(A) The individual is a participant in the educational 
     benefits program under chapter 32 of this title as of the 
     date of the enactment of the Montgomery GI Bill for the 21st 
     Century Act, or was eligible to participate in such program, 
     but had not participated in that program or any other 
     educational benefits program under this title, as of that 
     date.
       ``(B) The individual meets the requirements of subsection 
     (a)(3).
       ``(C) The individual, when discharged or released from 
     active duty, is discharged or released therefrom with an 
     honorable discharge.'';
       (4) in paragraph (5), as so redesignated, by striking 
     ``paragraph (3)(A)(ii)'' and inserting ``paragraph 
     (4)(A)(ii)''; and
       (5) in paragraph (6), as so redesignated, by inserting ``, 
     or individuals eligible to participate in that program who 
     have not participated in that program or any other 
     educational benefits program under this title,'' after 
     ``chapter 32 of this title''.
       (b) Conforming and Clerical Amendments.--(1) The heading of 
     such section is amended to read as follows:

     ``Sec. 3018C. Opportunity to enroll: certain VEAP 
       participants; certain individuals eligible for 
       participation in VEAP''.

       (2) The table of sections at the beginning of chapter 30 of 
     such title is amended by striking the item relating to 
     section 3018C and inserting the following new item:

``3018C. Opportunity to enroll: certain VEAP participants; certain 
              individuals eligible for participation in VEAP.''.

     SEC. 4. COMMENCEMENT OF 10-YEAR DELIMITING PERIOD FOR 
                   VETERANS, SURVIVORS, AND DEPENDENTS WHO ENROLL 
                   IN TRAINING PROGRAM.

       (a) Veterans.--Section 3031 of title 38, United States 
     Code, is amended--
       (1) in subsection (a), by striking ``through (g), and 
     subject to subsection (h)'' and inserting ``through (h), and 
     subject to subsection (i)'';
       (2) by redesignating subsection (h) as subsection (i); and
       (3) by inserting after subsection (g) the following new 
     subsection (h):
       ``(h) In the case of an individual eligible for educational 
     assistance under this chapter who, during the 10-year period 
     described in subsection (a) of this section, enrolls in a 
     program of training under this chapter, the period during 
     which the individual may use the individual's entitlement to 
     educational assistance under this chapter expires on the last 
     day of the 10-year period beginning on the first day of the 
     individual's pursuit of such program of training.''.
       (b) Eligible Children.--Subsection (a) of section 3512 of 
     such title is amended--
       (1) in paragraph (6)(B), by striking ``and'' at the end;
       (2) in paragraph (7), by striking the period at the end and 
     inserting ``; and''; and
       (3) by adding at the end the following new paragraph:
       ``(8) if the person enrolls in a program of special 
     restorative training under subchapter V of this chapter, such 
     period shall begin on the first day of the person's pursuit 
     of such program of special restorative training.''.
       (c) Eligible Surviving Spouses.--Subsection (b) of such 
     section is amended by adding at the end the following new 
     paragraph:
       ``(3) Notwithstanding the provisions of paragraph (1) of 
     this subsection, any eligible person (as defined in section 
     3501(a)(1)(B) or (D)(ii) of this title) who, during the 10-
     year period described in paragraph (1) of this subsection, 
     enrolls in a program of special restorative training under 
     subchapter V of this chapter may be afforded educational 
     assistance under this chapter during the 10-year period 
     beginning on the first day of the individual's pursuit of 
     such program of special restorative training.''.

     SEC. 5. AVAILABILITY OF EDUCATION BENEFITS FOR PAYMENT FOR 
                   NATIONAL ADMISSIONS EXAMS AND NATIONAL EXAMS 
                   FOR CREDIT AT INSTITUTIONS OF HIGHER EDUCATION.

       (a) Covered Exams.--Sections 3452(b) and 3501(a)(5) of 
     title 38, United States Code, are each amended by adding at 
     the end the following new sentence: ``Such term also includes 
     national tests for admission to institutions of higher 
     learning or graduate schools (such as the SAT, LSAT, GRE, and 
     GMAT exams) and national tests providing an opportunity for 
     course credit at institutions of higher learning (such as the 
     AP exam).''.
       (b) Amount of Payment.--
       (1) Chapter 30.--Section 3032 of such title is amended by 
     adding at the end the following new subsection:
       ``(g)(1) Subject to paragraph (3), the amount of 
     educational assistance payable under this chapter for a 
     national test for admission or national test providing an 
     opportunity for course credit at institutions of higher 
     learning described in section 3452(b) of this title is the 
     amount of the fee charged for the test.
       ``(2) The number of months of entitlement charged in the 
     case of any individual for a test described in paragraph (1) 
     is equal to the number (including any fraction) determined by 
     dividing the total amount of educational assistance paid such 
     individual for such test by the full-time monthly 
     institutional rate of educational assistance, except for 
     paragraph (1), such individual would otherwise be paid under 
     subsection (a)(1), (b)(1), (d), or (e)(1) of section 3015 of 
     this title, as the case may be.
       ``(3) In no event shall payment of educational assistance 
     under this subsection for a test described in paragraph (1) 
     exceed the amount of the individual's available entitlement 
     under this chapter.''.
       (2) Chapter 32.--Section 3232 of such title is amended by 
     adding at the end the following new subsection:
       ``(d)(1) Subject to paragraph (3), the amount of 
     educational assistance payable under this chapter for a 
     national test for admission or national test providing an 
     opportunity for course credit at institutions of higher 
     learning described in section 3452(b) of this title is the 
     amount of the fee charged for the test.
       ``(2) The number of months of entitlement charged in the 
     case of any individual for a test described in paragraph (1) 
     is equal to the number (including any fraction) determined by 
     dividing the total amount of educational assistance paid such 
     individual for such test by the full-time monthly 
     institutional rate of educational assistance, except for 
     paragraph (1), such individual would otherwise be paid under 
     this chapter.
       ``(3) In no event shall payment of educational assistance 
     under this subsection for a test described in paragraph (1) 
     exceed the amount of the individual's available entitlement 
     under this chapter.''.
       (3) Chapter 34.--Section 3482 of such title is amended by 
     adding at the end the following new subsection:
       ``(i)(1) Subject to paragraph (3), the amount of 
     educational assistance payable under this chapter for a 
     national test for admission or national test providing an 
     opportunity for course credit at institutions of higher 
     learning described in section 3452(b) of this title is the 
     amount of the fee charged for the test.
       ``(2) The number of months of entitlement charged in the 
     case of any individual for a test described in paragraph (1) 
     is equal to the number (including any fraction) determined by 
     dividing the total amount of educational assistance paid such 
     individual for such test by the full-time monthly 
     institutional rate of educational assistance, except for 
     paragraph (1), such individual would otherwise be paid under 
     this chapter.
       ``(3) In no event shall payment of educational assistance 
     under this subsection for a test described in paragraph (1) 
     exceed the amount of the individual's available entitlement 
     under this chapter.''.
       (4) Chapter 35.--Section 3532 of such title is amended by 
     adding at the end the following new subsection:
       ``(g)(1) Subject to paragraph (3), the amount of 
     educational assistance payable under this chapter for a 
     national test for admission or national test providing an 
     opportunity for course credit at institutions of

[[Page S6905]]

     higher learning described in section 3501(a)(5) of this title 
     is the amount of the fee charged for the test.
       ``(2) The number of months of entitlement charged in the 
     case of any individual for a test described in paragraph (1) 
     is equal to the number (including any fraction) determined by 
     dividing the total amount of educational assistance paid such 
     individual for such test by the full-time monthly 
     institutional rate of educational assistance, except for 
     paragraph (1), such individual would otherwise be paid under 
     this chapter.
       ``(3) In no event shall payment of educational assistance 
     under this subsection for a test described in paragraph (1) 
     exceed the amount of the individual's available entitlement 
     under this chapter.''.

     SEC. 6. INCREASE IN MAXIMUM AMOUNT OF HOME LOAN GUARANTY FOR 
                   CONSTRUCTION AND PURCHASE OF HOMES AND ANNUAL 
                   INDEXING OF AMOUNT.

       (a) Maximum Loan Guaranty Based on 100 Percent of Freddie 
     Mac Conforming Loan Rate.--Section 3703(a)(1) of title 38, 
     United States Code, is amended by striking ``$60,000'' each 
     place it appears in subparagraphs (A)(i)(IV) and (B) and 
     inserting ``the maximum guaranty amount (as defined in 
     subparagraph (C))''.
       (b) Definition.--Such section is further amended by adding 
     at the end the following new subparagraph:
       ``(C) In this paragraph, the term `maximum guaranty amount' 
     means the dollar amount that is equal to 25 percent of the 
     Freddie Mac conforming loan limit limitation determined under 
     section 305(a)(2) of the Federal Home Loan Mortgage 
     Corporation Act (12 U.S.C. 1454(a)(2)) for a single-family 
     residence, as adjusted for the year involved.''.

                          ____________________