[Senate Report 110-449]
[From the U.S. Government Publishing Office]
Calendar No. 947
110th Congress Report
SENATE
2d Session 110-449
======================================================================
VETERANS' BENEFITS IMPROVEMENT ACT OF 2008
_______
September 9, 2008.--Ordered to be printed
_______
Mr. Akaka, from the Committee on Veterans' Affairs, submitted the
following
R E P O R T
together with
SUPPLEMENTAL VIEWS
[To accompany S. 3023]
The Committee on Veterans' Affairs (the Committee), to
which was referred the bill (S. 3023), to amend title 38,
United States Code, to require the Secretary of Veterans
Affairs to prescribe regulations relating to the notice to be
provided claimants with the Department of Veterans' Affairs
regarding the substantiation of claims, having considered the
same, unanimously reports favorably thereon with an amendment,
and an amendment to the title, and recommends that the bill, as
amended, do pass.
Introduction
On May 15, 2008, Committee Chairman Daniel K. Akaka
introduced S. 3023, the proposed ``Veterans' Notice
Clarification Act of 2008.'' S. 3023 would amend title 38,
United States Code, to improve notices provided to veterans
applying for disability compensation, and for other purposes.
The bill was referred to the Committee.
Earlier on January 4, 2007, Senator Thune introduced S.
161, the proposed ``Veterans' Disability Compensation Automatic
COLA Act.'' Later, Senators Snowe and Tester were added as
cosponsors. S. 161 would require that, whenever there is an
increase in benefit amounts payable under title II (Federal
Old-Age, Survivors, and Disability Insurance Benefits) of the
Social Security Act, the Secretary of Veterans Affairs shall
increase by the same percentage the amounts payable as
veterans' disability compensation and dependency and indemnity
compensation for surviving spouses and children.
On June 27, 2007, Senator Brown introduced S. 1718, the
proposed ``Veterans Education Tuition Support Act,'' with
Senator Salazar as an original cosponsor. Later, Senators
Baucus, Boxer, Casey, Domenici, Klobuchar, McCaskill, Menendez,
Mikulski, Murray, Sessions, Stabenow, Tester, and Webb were
added as cosponsors. S. 1718 would amend the Servicemembers
Civil Relief Act (SCRA) to provide protections for
servicemembers who are called to active duty while enrolled in
institutions of higher education.
On September 25, 2007, Chairman Akaka introduced S. 2090 by
request of the United States Court of Appeals for Veterans
Claims (CAVC or the Court). S. 2090 would enhance privacy
protection and alleviate security concerns regarding the
records of the Court.
On September 25, 2007, Chairman Akaka introduced S. 2091 by
request of CAVC. S. 2091 would increase the number of judges on
the Court from seven to nine.
On December 13, 2007, Senator Kennedy introduced S. 2471,
the proposed ``USERRA Enforcement Improvement Act of 2007,''
with Chairman Akaka and Senator Obama as original cosponsors.
Later, Senator Clinton was added as a cosponsor. S. 2471 would
amend the current Uniformed Services Employment and
Reemployment Rights Act (USERRA) complaint process and modify
and expand the reporting requirements with respect to
enforcement of USERRA.
On January 23, 2008, Senator Hutchison introduced S. 2550,
the proposed ``Combat Veterans Debt Elimination Act of 2008,''
with Senators Cornyn and Johnson as original cosponsors. Later,
Ranking Minority Member Burr and Senators Alexander, Allard,
Bayh, Brown, Brownback, Byrd, Cochran, Conrad, Domenici,
Ensign, Isakson, McConnell, Murray, Roberts, Sessions, Sununu,
and Wicker were added as cosponsors. S. 2550 would prohibit the
Secretary of Veterans Affairs from collecting debts owed to the
United States by certain members of the Armed Forces or
veterans who die as a result of an injury incurred or
aggravated on active duty in a war or a combat zone after
September 11, 2001.
On February 28, 2008, Ranking Minority Member Burr
introduced S. 2674, the proposed ``America's Wounded Warriors
Act.'' Later, Senators Cochran, Domenici, and Isakson were
added as cosponsors. Title II of S. 2674 would direct the
Department of Veterans Affairs (VA or the Department) to
conduct a series of studies on reforming the disability
compensation system and then submit to Congress a proposal for
a new compensation and transition payment rate structure.
On March 10, 2008, Chairman Akaka introduced S. 2737, the
proposed ``Veterans' Rating Schedule Review Act.'' S. 2737
would authorize CAVC to review whether, and the extent to
which, the rating schedule for veterans' disabilities complies
with statutory requirements applicable to entitlement to
veterans' disability compensation for service-connected
disability or death.
On March 13, 2008, Chairman Akaka introduced S. 2768, with
Ranking Minority Member Burr, and Senators Baucus, Boxer,
Brown, Clinton, Durbin, Kerry, Murray, Obama, Reid,
Rockefeller, and Sanders as original cosponsors. Later,
Senators Cantwell, Isakson, Schumer, and Smith were added as
cosponsors. S. 2768 would provide a temporary increase, during
the period beginning on the date of enactment of this Act and
ending on December 31, 2011, in the maximum veterans' loan
guaranty amount for housing loans guaranteed by VA.
On April 17, 2008, Chairman Akaka introduced S. 2889, the
proposed ``Veterans Health Care Act of 2008,'' by request of
VA. Section 7 of S. 2889 would make permanent VA's authority to
obtain income information from the Internal Revenue Service and
the Social Security Administration.
On April 30, 2008, Senator Vitter introduced S. 2946, with
Senator Brownback as an original cosponsor. S. 2946 would allow
a stillborn child to be an insurable dependent under
Servicemembers' Group Life Insurance (SGLI).
On May 1, 2008, Senator Baucus introduced S. 2951, with
Senators Lugar and Tester as original cosponsors. S. 2951 would
require reports on VA's progress in addressing causes for
variances in compensation payments to veterans for service-
connected disabilities.
On May 1, 2008, Chairman Akaka introduced S. 2961. S. 2961
would enhance the refinancing of home loans by veterans.
On May 1, 2008, Senator Boxer introduced S. 2965, with
Senator Lieberman as an original cosponsor. S. 2965 would
require a report from VA on the inclusion of severe and acute
Post Traumatic Stress Disorder among the conditions covered by
traumatic injury protection under SGLI.
On May 6, 2008, Senator Casey introduced S. 2981, the
proposed ``Disabled Veterans Home Ownership Preservation Act of
2008,'' with Senator Isakson as an original cosponsor. S. 2981
would amend SCRA to provide a one-year period of protection
against mortgage foreclosures for certain disabled or severely
injured servicemembers, and for other purposes.
On May 6, 2008, Chairman Akaka introduced S. 2984, the
proposed ``Veterans' Benefits Enhancement Act of 2008,'' by
request of VA. S. 2984 would eliminate the reporting
requirement for prior training; modify the waiting period
before the affirmation of enrollment in a correspondence
course; eliminate the change-of-program application; eliminate
the wage earning requirement for self-employment on-job
training; authorize memorial headstones and markers for
deceased remarried surviving spouses of veterans; make
permanent VA's authority to contract for medical disability
examinations; make modifications to SGLI; permit VA to provide
Temporary Residence Assistance Grants to certain
servicemembers; and designate a VA Office of Small Business
Programs.
On May 7, 2008, the Committee held a hearing on benefits
legislation at which testimony was offered by: Mr. Keith
Pedigo, Associate Deputy Under Secretary for Policy and Program
Management, Department of Veterans Affairs; Mr. Carl Blake,
National Legislative Director, Paralyzed Veterans of America;
Mr. Richard Paul Cohen, Executive Director, National
Organization of Veterans' Advocates; Mr. Eric A. Hilleman,
Deputy Director of the National Legislative Service, Veterans
of Foreign Wars of the United States; Mr. Ray Kelley,
Legislative Director, AMVETS; Mr. Steve Smithson, Deputy
Director, Veterans Affairs and Rehabilitation Commission, The
American Legion; Mr. Joseph Violante, National Legislative
Director, Disabled American Veterans; Mr. Rick Weidman,
Governmental Affairs Director, Vietnam Veterans of America; Mr.
Herman Gerald Starnes, U.S. Merchant Marine with service in
World War II; and Mr. Charles Dana Gibson, U.S. Merchant Marine
with service in World War II and maritime historian.
On May 8, 2008, Chairman Akaka introduced S. 3000, the
proposed ``Native American Veterans Access Act of 2008,'' with
Senator Inouye as an original cosponsor. S. 3000 would allow
tribal governments to apply for veterans' program grants that
are currently limited to States and certain U.S. Territories.
On June 5, 2008, Senator Snowe introduced S. 3087, the
proposed ``Helping Our Veterans to Keep Their Homes Act of
2008.'' S. 3087 would extend VA's authority to guaranty
adjustable rate mortgages and hybrid adjustable rate mortgages.
Committee Meeting
After carefully reviewing the testimony from the foregoing
hearing, the Committee met in open session on June 26, 2008, to
consider, among other legislation, an amended version of S.
3023, consisting of provisions from S. 3023, as introduced, and
from the legislation noted above. The Committee voted
unanimously to report favorably S. 3023, as amended, to the
Senate.
Summary of S. 3023 as Reported
S. 3023, as reported (the Committee bill), consists of six
titles, summarized below.
TITLE I--COMPENSATION AND PENSION MATTERS
Section 101 would require VA to promulgate regulations
specifying the content of notices to be provided to claimants
for original claims, reopened claims and claims for an increase
in benefits. This would apply to notices sent on or after the
date the regulations are effective.
Section 102 would authorize the United States Court of
Appeals for the Federal Circuit to review VA actions relating
to the adoption or revision of the VA disability rating
schedule in the same manner as other actions of the Secretary
of Veterans Affairs are reviewed.
Section 103 would provide an automatic annual increase in
rates of disability compensation and dependency and indemnity
compensation.
Section 104 would make a technical correction to the
National Defense Authorization Act for Fiscal Year 2008.
Section 105 would require a report describing VA's progress
in addressing the causes for any unacceptable variances in
compensation payments to veterans for service-connected
disabilities.
Section 106 would require a report on studies regarding
compensation of veterans for loss of earning capacity, quality
of life, and long-term transition payments to veterans
undergoing rehabilitation for service-connected disabilities.
TITLE II--HOUSING MATTERS
Section 201 would temporarily increase the maximum loan
guaranty amount for certain housing loans guaranteed by VA.
Section 202 would permit regular loans in excess of
$144,000 to be refinanced with a loan guaranteed by VA and
decrease the equity requirement for veterans who refinance to a
loan backed by VA.
Section 203 would provide a four-year extension of two
demonstration projects of adjustable rate mortgages.
Section 204 would make members of the Armed Forces with
certain service-connected disabilities eligible for specially
adapted housing benefits and assistance.
Section 205 would require a report on the impact of housing
foreclosures on veterans and the adequacy of protection against
foreclosure in existing law.
TITLE III--LABOR AND EDUCATION MATTERS
SUBTITLE A--LABOR AND EMPLOYMENT MATTERS
Section 301 would waive the 24-month limitation on a
program of independent living services and assistance for
veterans with a severe disability incurred in the Post-9/11
Global Operations period.
Section 302 would reform the USERRA complaint process.
Section 303 would modify and expand the reporting
requirements with respect to enforcement of USERRA.
Section 304 would require USERRA training for the executive
branch human resources personnel.
Section 305 would require a report on efforts to address
the employment needs of Native American veterans living on
tribal lands.
Section 306 would require a report on measures that could
be taken by VA to assist and encourage veterans in completing
vocational rehabilitation.
SUBTITLE B--EDUCATION MATTERS
Section 311 would provide relief for students who
discontinue education because of military service.
Section 312 would extend the period of eligibility for
Survivors' and Dependents' Educational Assistance of certain
spouses of individuals with service-connected disabilities
total and permanent in nature.
Section 313 would repeal the requirement that an
educational institution providing non-accredited courses notify
VA of the credit granted for prior training of certain
individuals.
Section 314 would decrease the waiting period before
affirmation of enrollment in a correspondence course may be
finalized for purposes of receiving educational assistance from
VA.
Section 315 would repeal the requirement that an individual
notify VA when the individual changes educational programs but
remains enrolled at the same educational institution.
Section 316 would exempt on-the-job training programs from
the requirement to provide participants with wages if the
training program is offered in connection with the purchase of
a franchise.
SUBTITLE C--OTHER MATTERS
Section 321 would rename VA's Office of Small and
Disadvantaged Business Utilization as the VA Office of Small
Business Programs.
TITLE IV--COURT MATTERS
Section 401 would increase the number of active judges on
the Court.
Section 402 would provide for the protection of privacy and
security concerns in Court records.
Section 403 would modify the rules governing service and
payment of retired judges performing recall service for the
Court.
Section 404 would require the Court to submit annual
reports to Congress on its workload.
TITLE V--INSURANCE MATTERS
Section 501 would require a report on the inclusion of
severe and acute Post Traumatic Stress Disorder among the
conditions covered by traumatic injury protection coverage
under SGLI.
Section 502 would provide for the treatment of stillborn
children as insurable dependents under SGLI.
Section 503 would extend SGLI coverage to certain members
of the Individual Ready Reserve. It would terminate coverage
under SGLI for a servicemember's dependent 120 days after the
servicemember separates from service. It would authorize VA to
set SGLI premiums for Ready Reservists' spouses based on the
age of the spouse. It would create a forfeiture of insurance
under the Veterans' Group Life Insurance (VGLI) program for
actions such as mutiny or treason.
TITLE VI--OTHER MATTERS
Section 601 would create the authority for suspension or
termination of claims of the United States against individuals
who died while serving on active duty in the Armed Forces.
Section 602 would provide memorial headstones and markers
for deceased remarried surviving spouses of veterans.
Section 603 would provide a three-year extension of
authority for VA to carry out income verification using records
from the Internal Revenue Service (IRS) and Social Security
Administration (SSA).
Section 604 would extend the authority for VA to fund
contract medical disability examinations.
Background and Discussion
TITLE I--COMPENSATION AND PENSION MATTERS
Sec. 101. Regulations on contents of notice to be provided claimants
with the Department of Veterans Affairs regarding
substantiation of claims.
Section 101 of the Committee bill, which is derived from S.
3023 as introduced, would require VA to promulgate regulations
relating to the notice provided to claimants seeking VA
benefits.
Background. VA's system for adjudicating claims for
service-connected disability benefits is intended to be a
claimant-friendly and non-adversarial process. Under chapter 51
of title 38, VA has a duty to assist claimants in gathering the
necessary information and evidence to fully develop their
claims.
A series of CAVC rulings in the 1990s narrowly interpreted
the duty to assist concept, culminating in Morton v. West, 12
Vet. App. 477 (1999), which held that VA had no authority to
assist. claimants absent verification that the claim was well-
grounded. The CVAC found that VA was precluded from assisting a
claimant ``in any way unless that claimant had first
established that his or her claim was well-grounded.'' PVA v.
Secretary, 345 F.3d 1334, 1338 (Fed. Cir. 2003). As a result of
the Morton decision, VA ceased providing any assistance to
claimants who did not have a ``well-grounded claim'' except for
the verification of military service and obtaining service
medical records.
Congress disagreed with the Court's interpretation of VA's
duty to assist and, in 2000, in Public Law 106-475, the
Veterans Claims Assistance Act of 2000 (VCAA), clarified and
expanded VA's duty to assist claimants. The VCAA reinstated
VA's traditional practice of assisting veterans at the
beginning of the claims process.
Prior to the enactment of the VCAA, section 5103 of title
38 provided that, if a claimant's application for benefits was
incomplete, VA was required to notify the claimant of the
evidence necessary to complete the application. Under the
changes made by the VCAA, VA is required to inform the claimant
of what information and medical or lay evidence is needed to
substantiate the claim. The notice must also stipulate what
evidence and information is to be obtained by the claimant and
what evidence is VA's responsibility. VA is also required to
notify the claimant when it is unable to obtain the relevant
records.
Since the enactment of the VCAA, various actions, including
decisions of the Court and VA's responses to some of those
decisions, have led to notices that are not meeting the goal of
providing claimants with sufficient, clear information on which
they can then act. Instead of simple, straightforward notices
that can be easily read and understood by claimants, VA is now
routinely providing long, frequently convoluted, overly
legalistic notices that do not meet the objective of the VCAA.
It is clear to the Committee that there is abundant evidence
supporting the need to change the current situation and strong
support for doing so.
For example, the Committee notes that there have been cases
subsequent to the enactment of VCAA, such as Dingess v.
Nicholson, 19 Vet. App. 473 (2006), in which the Court has
interpreted the notice requirement to include information
concerning so-called ``downstream'' issues, such as the rating
schedule and effective date, before a determination of service-
connection is made, a result not contemplated by the original
law. In other cases, such as Vazquez-Flores v. Peake, 22 Vet.
App. 37 (2008), it appears that VA has misinterpreted the
intent of the Court by suggesting that a preadjudication of
claims would be required prior to sending a VCAA notice. In
VA's motion to stay its original decision, the Court stated,
``the Secretary need only identify the assigned DC [diagnostic
code] and cross-referenced DCs, review them for specific
criteria for which the generic notice is insufficient, and add
general notice of the evidence needed to satisfy that
criteria.'' Vazquez-Flores v. Peake, 22 Vet. App. 91 (2008).
In recent oversight visits to 19 different VA regional
offices, a Democratic Committee staff member reviewed 298
individual claim files and found that VCAA letters sent to
claimants provide little practical assistance to those
veterans. In many of the claims examined, information that
would have been helpful in substantiating the claim was
missing. However, the files did not indicate that VA had
requested the missing information. For example, a veteran
filing an original claim, would indicate ``See SMRs [Service
Medical Records]'' rather than providing dates of disability
and treatment locations. In a number of files reviewed, the
evidence showed that service medical records were missing or
incomplete. In cases involving combat, time and location
information may be needed in order for VA to determine if the
relaxed evidentiary requirements of section 1154 of title 38
should be applied, but review of the files found that such
information was neither provided nor requested. The Committee
believes that time and location information should be requested
in those cases where it is needed for VA to provide effective
assistance in locating relevant government records.
With respect to reopened claims or claims for an increase,
the VCAA letters are also legalistic and confusing. In over 50
percent of the claims reviewed at regional offices, VA staff
agreed that errors involving service-connection or the rating
assigned were committed. Where service-connection was an issue,
VCAA letters involving reopened claims generally did not inform
veterans of the element of the claim for which evidence would
be needed to reopen the claim. For example, a VCAA letter to a
veteran with a current disability would not state that the
evidence needed to reopen the claim was evidence of the
relationship between the current disability and military
service. As a result, a veteran would submit considerable
evidence concerning the extent of the disability but would fail
to submit needed evidence of the relationship, or nexus,
between the disability and military service.
In testimony before the Committee, on July 9, 2008, Kerry
Baker, Associate National Legislative Director of the Disabled
American Veterans noted that ``the language of section 5103(a)
has led to such a procedural quagmire that it is not fulfilling
its intended benefit to VA claimants.'' During the same
hearing, William ``Bo'' Rollins, Director of Field Services for
the Paralyzed Veterans of America stated ``Congress should
consider amending the [VCAA] law to direct VA to fill in the
contours of an adequate VCAA notice letter.''
The Veterans' Disability Benefits Commission (VDBC), in its
final report, expressed concerns about VA's efforts to comply
with the VCAA, based on its site visits and general study of VA
claims adjudication. The VDBC reported receiving numerous
complaints that the notice letters they were receiving were too
long and overburdened with legal language. The VDBC recognized
that the notices are not clear or succinct:
VA should consider amending Veterans Claims Assistance
Act letters by including all claim-specific information
to be shown on the first page and all other legal
requirements would be reflected, either on a separate
form or on subsequent pages. In particular, VA should
use plain language in stating how the claimant can
request an early decision in his or her case.
IBM Global Business Services, with which VA contracted in
the Fall of 2007 to conduct an analysis of VA's business
processes for adjudicating disability claims and prescribe a
short-term action plan and long-term strategic plan for
improving the quality and efficiency of the process, also found
the current VCAA letter to be ``long and complex, containing a
great deal of legal language that can be confusing to veterans
when trying to understand the process for completing their
disability claim.'' It recommended that the current VCAA letter
be revised to be shorter and more transparent to veterans.
According to IBM, ``[c]omplex legal language which is required
to be in the letter should be translated into layman's terms,
or else placed in supplemental pages to the letter, while the
main body of the letter is clear and succinct.''
It is clear to the Committee that additional Congressional
guidance and a requirement for the promulgation of regulations
will aid VA in providing easy-to-read notices that will comply
with due process and VA's duty to assist under the VCAA.
Committee Bill. Section 101 of the Committee bill would
amend subsection (a) of section 5103 of title 38 to add a new
paragraph that would require VA to promulgate regulations
specifying the content of VCAA notices provided to claimants.
The regulations required by the Committee bill would require
that the notice specify for each type of claim for benefits the
general information and evidence required to substantiate the
claim. For example, if a claim involved benefits and services
based upon need, the notice would advise that information
concerning income and assets must be submitted. In a claim
based upon disability, the notice would reference the need for
evidence of disability, including signs or symptoms of a
disabling condition. The regulations should also specify
different content of the notices depending on the type of claim
concerned, whether it be an original claim, a claim for
reopening, or a claim for increase in benefits.
The Committee emphasizes that VCAA notices are required
only in cases in which additional information or evidence is
needed to substantiate the claim. If the information and
evidence needed to substantiate the claim is submitted with the
application or contained in the claims file, no VCAA notice is
required. For example, claims for education, health care,
housing, vocational rehabilitation, and burial benefits might
contain sufficient information and evidence to substantiate the
claim without the necessity of a VCAA notice.
With respect to original claims, the Committee believes
that the regulations relating to notice for original claims
should specify that the information and evidence referenced in
the VCAA notice should be relevant to the basic elements of the
claim for benefits or services sought: (1) evidence of current
disability or symptoms of disability; (2) evidence relating to
a disability, symptoms of disability, one or more incidents or
events in service giving rise to or aggravating a disability;
and (3) the relationship between the current disability and
military service.
The Committee expects that the regulations will require
that VCAA notices include a request for clarification of
missing or ambiguous information contained in a request for
benefits where it may be necessary or helpful to identify
evidence that may substantiate the claim. In cases concerning
service-connection, such requests might include approximate
dates and locations of treatment and if applicable, approximate
dates and locations related to combat experiences associated
with claimed disabilities.
The Committee is concerned that requiring VA to include in
notices relating to original claims information concerning
``downstream elements,'' such as the rating schedule and
effective date, before a determination of service-connection is
made, may be misleading and confusing to veterans. Such
information may lead a veteran into believing that service-
connection has been conceded and the issue on which evidence
must be submitted relates to the rating or effective date.
During oversight visits to 19 different VA regional
offices, a Democratic Committee staff member has identified
some claims for which VA has no duty to assist, because there
was no reasonable possibility that such assistance would result
in substantiating a claim. These claims included claims for
environmental exposure without any indication that any
disability is related to the alleged exposure. The regulations
may provide that notice in such cases may indicate that no
development will be undertaken, unless the veteran indicates a
disability that is related to the claimed exposure. Other
examples of cases in which the notice may indicate that VA
assistance cannot help include claims involving conditions,
such as high cholesterol, with no related disability alleged,
and male pattern baldness, which is not considered a disability
under VA regulations. In such instances, the regulations may
provide that the notification will indicate that the claims
will not be developed because there is no reasonable
possibility that such assistance would result in substantiating
the claim.
With respect to claims to reopen a previously denied claim,
the Committee believes that different VCAA notice
considerations should apply. In recent oversight visits by a
Democratic Committee staff member, it was noted that a number
of veterans' claims were denied because of a lack of nexus
between a claimed disability and military service but with no
indication that a medical opinion was acquired, as required by
section 5103A of title 38. This error is frequently identified
by the Board of Veterans' Appeals in remands of appealed cases.
In other cases, the veteran may have filed an ambiguous,
potential, or inferred claim that was not clarified before the
claim was decided. The Democratic Committee staff member also
identified a number of cases in which a veteran seeking to
reopen a previously denied claim for service-connection
submitted substantial and often duplicative documentation
concerning a current disability, apparently unaware that the
basis for the denial was a lack of evidence linking the
disability to military service.
The Committee does not expect that the regulations would
require a full pre-adjudication file review prior to issuing a
VCAA letter involving a reopened claim. However, the
regulations should require the notice in such cases to
appropriately reference the prior decision with respect to what
element of the claim requires new and material evidence to
reopen the claim and what type of evidence is required. In this
regard, the Committee notes the opinion of the Court in Kent v.
Nicholson, 20 Vet. App. 1, 9 (2006), in which the Court
indicated that ``VA must notify a claimant of the evidence and
information that is necessary to reopen the claim and VA must
notify the claimant of the evidence and information that is
necessary to establish his entitlement to the underlying claim
for the benefit sought by the claimant.'' The Committee expects
regulations concerning reopened claims to comply with the Kent
standard.
The Committee notes that given the large amount of
documentation often contained in claims files, it is not
practical, feasible, or efficient to require that every
document in an existing claims file be reviewed before a VCAA
letter is issued. By focusing the regulation on the decision
sought to be reopened with reference to the evidence considered
in that decision, the Committee believes that VCAA and Kent
compliance would be achieved.
The Committee recognizes that review of the most recent
prior decision might also result in a finding of ``clear and
unmistakable error'' (CUE). During Committee oversight visits
by a Democratic staff member, some claims were identified with
CUE in the original rating decision. For example, several
rating decisions for service-connection of asthma acknowledged
that the veteran required daily inhalation bronchodilator
therapy but rated such a claim at 10 percent rather than 30
percent which the same decision recognized as the correct
rating for such a disability. In most of the claims where CUE
was found, the veteran had not appealed an erroneous decision
and, in a few cases, had attempted to reopen the decision
rather than appeal. Such errors were promptly corrected by the
regional office during the oversight visits. A review by VA of
the decision sought to be reopened in preparation for the VCAA
notice should identify clear examples of CUE, leading to a
revised decision which would moot the request for reopening.
With respect to claims for an increase in the degree of
service-connected disability, the Committee expects that the
regulation will require VA to review the most recent rating
decision concerning the disability for which an increased
rating is claimed and, in the words of the Court in Vazquez-
Flores v. Peake, 22 Vet. App. 91, 93 (2008) make ``a common-
sense assessment whether the criteria for a higher rating under
the assigned or a cross-referenced DC [diagnostic code]
includes criteria `that would not be satisfied by the claimant
demonstrating a noticeable worsening or increase in severity of
the disability * * *'.''
The Committee notes that the best evidence upon which to
evaluate a claim for an increased rating is a complete and
thorough medical examination that should provide sufficient
evidence for VA rating staff to determine which rating code is
appropriate to the findings and diagnosis made by the examiner.
Unless the medical evidence submitted by the veteran requesting
an increased rating or the other VA records demonstrate that
such an increase is warranted, the Committee believes that the
VCAA notice involving a claim for an increase should indicate
that a VA medical examination will be ordered. The regulation
should also require that the veteran be informed as to the
general information and medical or lay evidence needed to
establish a claim for extra-schedular consideration.
The Committee believes that, by notifying the veteran that
an examination would be scheduled to evaluate the current
disability involved in the claim for an increase and the
criteria for establishing extra-schedular consideration, the
duty to notify would be met. VA would need to comply with the
Vazquez-Flores requirement for additional diagnostic codes or
other criteria only when a ``common-sense assessment'', such as
the identification of cross-referenced codes, is indicated. In
cases where a common-sense assessment requires information
concerning additional diagnostic code criteria, the regulations
may provide that such criteria be included as an appendix
rather than in the body of the VCAA letter.
VCAA letters concerning claims for increased ratings should
be based upon the rating code that was assigned in the most
recent prior decision and any other cross-referenced rating
codes that might provide a basis for an increase in benefits.
However, the Committee does not expect that such a requirement
should be interpreted to require notice and diagnostic codes
for all potential disabilities involving a particular body
system or part.
Under the amendment proposed in the Committee bill, VA
would be specifically authorized to issue additional or
alternative regulations in order to tailor the VCAA notice to
the specific elements of the claim for the particular type of
benefits or services sought. In cases in which more than one
type of claim is filed in the same document, VA would have the
flexibility to issue separate VCAA notices on the different
types of claims or to provide the information relevant to each
type of claim in the same VCAA notice. The Committee intends
that, in determining whether to require separate or combined
notices, VA will take into account the intent of Congress to
promote simple and easy-to-understand VCAA notices.
The amendment proposed in the Committee bill would also
require that the regulations contain information concerning the
time within which the information and evidence to be provided
by the claimant must be submitted in order for benefits to be
paid or services rendered under the claim.
This provision is intended to simplify the notices by
reducing the amount of extraneous information provided and
clarifying the responsibilities of the claimant to provide
relevant information and evidence. The regulations required by
section 101 would apply to all notices issued on or after the
date the regulations are made effective.
The Committee is aware that VA has taken action to revise
the VCAA letter. VA Deputy Under Secretary for Benefits,
Michael Walcoff, testified at a February 14, 2008, hearing of
the House Committee on Veterans' Affairs that the ``current
VCAA letters are lengthy and contain complex legal language
that many claimants find difficult to understand.'' At that
time, Mr. Walcoff reported that the Veterans Benefits
Administration was working closely with VA's Office of the
General Counsel to revise and simplify the letters. VA Acting
Under Secretary for Benefits, Rear Admiral Patrick Dunne,
testified at the Committee's July 9, 2008, hearing that four
new VCAA letter templates had been drafted for specific types
of claims. Admiral Dunne projected that the revised letters
would be available for use by regional offices by November
2008.
The Committee recognizes that VA does not require statutory
authority to make the proposed changes to its notices and
welcomes the expected introduction of these revised notices in
November 2008. However, the Committee believes that, given the
history of judicial interpretations of the notice requirement,
a statutory basis for the revised VCAA notice regulations
should be enacted.
The Committee notes that the regulations required by
section 101 of the Committee bill would have prospective effect
and does not intend that the required changes would be applied
retroactively.
Sec. 102. Judicial review of adoption and revision by the Secretary of
Veterans Affairs of the schedule of ratings for disabilities of
veterans.
Section 102 of the Committee bill, which is derived from S.
2737, would make actions of the Secretary of Veterans Affairs
relating to the adoption or revision of VA's rating schedule
for disabilities subject to the same type of review as that
applied to other actions of the Secretary.
Background. Until 1988, veterans were generally precluded
from obtaining judicial review of decisions made by the then-
Veterans Administration. Public Law 100-687, the Veterans'
Judicial Review Act, removed that bar by authorizing judicial
review of VA decisions in a newly established court, now known
as the United States Court of Appeals for Veterans Claims. That
law also provided for jurisdiction in the United States Court
of Appeals for the Federal Circuit for challenges to certain
actions of the Secretary of Veterans Affairs covered by the
Administrative Procedure Act. However, that law specifically
precluded review of actions relating to the adoption or
revision of the schedule of ratings for disabilities adopted
under section 1155 of title 38, United States Code. As a result
of that prohibition, a regulation found in the rating schedule
that is alleged to violate a statutory provision could be
insulated from judicial review.
A number of recent reports, including the Institute of
Medicine's report ``A 21st Century System for Evaluating
Veterans for Disability Benefits'' and the final report of the
Veterans' Disability Benefits Commission ``Honoring the Call to
Duty: Veterans' Disability Benefits in the 21st Century,'' have
noted the need to update obsolete sections of VA's rating
schedule. Without a change to current law, any changes to the
rating schedule regulations would be shielded from judicial
review.
S. 2737, the legislation from which section 102 of the
Committee bill is derived, would have provided for judicial
review of the rating schedule by CAVC. Such review would have
been available in order to determine if such regulations were
in compliance with provisions in chapter 11 of title 38, the
chapter relating to disability compensation.
During the Committee's May 7, 2008, hearing which focused
on pending legislation, including S. 2737, the VA witness,
Keith Pedigo, Associate Deputy Under Secretary for Policy and
Program Management of the Veterans Benefits Administration,
expressed concerns that the bill ``would essentially expose the
rating schedule to judicial review'' in every case involving
service-connection of a disability or a claim for an increased
rating and, as such, could increase litigation in CAVC and
result in piecemeal review of the rating schedule.
At that same hearing, several veterans service
organizations and the National Organization of Veterans'
Advocates testified in support of the bill.
Committee Bill. Section 102 of the Committee bill would
amend section 502 of title 38, relating to judicial review of
rules and regulations by striking out ``(other than an action
relating to the adoption or revision of the schedule of ratings
for disabilities adopted under section 1155 of this title),''
thereby providing for review of actions of the Secretary of
Veterans Affairs relating to adoption or revision of the rating
schedule by the United States Court of Appeals for the Federal
Circuit in the same way as other VA actions are reviewed.
The Committee believes that this approach will avoid the
concern about the piecemeal approach raised in VA's testimony
and should prevent multiple and possibly conflicting
interpretations of the rating schedule in various cases.
The Committee notes that the level and type of review
proposed in the Committee bill for the review of the rating
schedule would be circumscribed by a number of limitations. For
example, under the Rules of the United States Court of Appeals
for the Federal Circuit, an action seeking review of a rule or
regulation must be filed within 60 days of the effective date
of the rule or regulation.
Furthermore, under the standards set forth by the Supreme
Court of the United States in Chevron U.S.A., Inc. v. Natural
Res. Def. Council, Inc., 467 U.S. 837, 843 (1984), courts must
give deference to the Secretary's interpretation of a statute
``if the statute is silent or ambiguous with respect to the
specific issue.'' If Congress explicitly left a gap in the
statute for VA to fill, then the Secretary's interpretation is
controlling unless ``arbitrary, capricious, or manifestly
contrary to the statute.'' Id. at 843-844. If Congress
implicitly delegated authority to VA to fill the gap, the
Secretary's interpretation will be upheld if it is a reasonable
interpretation of the statute. Id. at 844.
During consideration of this issue, a concern was raised
that, under the proposed change allowing for judicial review of
actions by the Secretary relating to the adoption or revision
of VA's rating schedule, it was possible that challenges might
be taken in response to a denial by VA of a request for
rulemaking under subsection (e) of section 553 of title 5.
While it is correct that such a challenge is available under
current law and might be brought in the future, no cases have
been identified in which such a challenge has been brought with
reference to VA rulemaking since judicial review was instituted
in 1988. This lack of such actions may be explained by the
daunting burden facing a petitioner in such a case.
The Supreme Court of the United States only recently
addressed the reviewability of an agency decision to deny a
petition for rulemaking in Massachusetts v. EPA, 549 U.S. 497
(2007). In that case, the Supreme Court found that a refusal
``to promulgate rules are * * * susceptible to judicial review,
though such review is `extremely limited' and `highly
deferential.''' The Supreme Court cited two decisions of the
United States Court of Appeals for the District of Columbia
Circuit in its decision, American Horse Protection Association,
Inc. v. Lyng, 812 F.2d 1 (D.C. Cir. 1987), and National Customs
Brokers & Forwarders Ass'n v. United States, 883 F.2d 93 (D.C.
Cir. 1989). In National Customs Brokers, 883 F. 2d at 103, the
circuit court noted that ``[i]t is only in the rarest and most
compelling of circumstances that [the circuit court] has acted
to overturn an agency judgment not to institute rulemaking.''
In concluding that the agency had not acted improperly in
refusing to promulgate rules suggested by the petitioners, the
court found that this was ``not such a rare case'' because the
issues were ``economic in nature'' and entailed ``policy
determinations on which agency rulemaking discretion is
respected.'' Id. Thus, the Committee believes that the general
authority that would be provided by this section would likely
afford veterans relief under only very limited circumstances in
a matter involving a denial on VA's part to engage in
rulemaking.
Finally, the Committee notes that as a result of removing
the prohibition on review of actions of the Secretary relating
to adoption or revision of the rating schedule in current law,
the United States Court of Appeals for the Federal Circuit
would be authorized to review agency records that underlie
challenges to rules and regulations in the same manner as is
currently applied to other VA regulations. The Committee
expects VA's rulemaking procedures and fact-finding to be
sufficiently robust to permit meaningful review of actions
relating to the adoption and revision of the rating schedule.
Sec. 103. Automatic annual increase in rates of disability compensation
and dependency and indemnity compensation.
Section 103 of the Committee bill, which is derived from S.
161, would require that whenever there is an increase in
benefit amounts payable under title II of the Social Security
Act, VA would automatically increase the rates of disability
compensation and dependency and indemnity compensation, among
other rates, by the same percentage and effective on the same
date.
Background. The service-connected disability compensation
program under chapter 11 of title 38, United States Code,
provides monthly cash benefits to veterans who have
disabilities incurred or aggravated during active service in
the Armed Forces. The amount of compensation paid depends on
the nature and severity of a veteran's disability or
combination of disabilities and the extent to which the
disability impairs earning capacity. Certain veterans with more
severe disabilities are also eligible to receive additional
compensation on behalf of the veteran's spouse, children, and
dependent parents.
Under chapter 13 of title 38, VA pays dependency and
indemnity compensation (DIC) to the survivors of servicemembers
or veterans who died on or after January 1, 1957, from a
disease or injury incurred or aggravated during military
service. Survivors eligible for DIC include surviving spouses,
unmarried children under the age of 18, children age 18 or
older who are permanently incapable of self-support, children
between the ages of 18 and 22 who are enrolled in school, and
certain needy parents.
Section 415(i) of title 42, provides for an automatic
annual cost-of-living adjustment (COLA) for benefits payable
under title II of the Social Security Act based on the annual
increase in consumer prices. Title II Social Security benefits
are indexed to the Consumer Price Index for Urban Wage Earners
and Clerical Workers (CPI-W), which is published on a monthly
basis by the Bureau of Labor Statistics. The annual COLA
increase is equivalent to the increase in the CPI-W from the
most recent period between the third quarter of one calendar
year to the third quarter of the next.
Currently, under section 5312 of title 38, there are
several VA benefits which receive automatic increases tied to
the annual adjustments in title II Social Security benefits.
These include pension benefits for indigent, wartime veterans
who are permanently and totally disabled due to a non-service-
connected condition, or over the age of 65, as well as their
surviving spouses and children, and DIC benefits for the
parents of a deceased veteran who are living below a certain
income threshold.
However, the majority of disability compensation and DIC
benefits paid by VA are not indexed to the CPI-W and do not
increase automatically when title II Social Security benefits
are increased. Instead, Congress regularly enacts a cost-of-
living adjustment on an annual basis to ensure that inflation
does not erode the purchasing power of VA benefits. Although
Congress in recent years has consistently enacted legislation
on time so as to provide benefit recipients with a COLA
increase beginning December 1 of each year, veterans service
organizations and VA now support making the COLA automatic,
rather than relying on annual legislation.
Committee Bill. Section 103 of the Committee bill would
amend section 5312 of title 38, so as to add a new subsection
(d)(1), which would require VA to increase the amounts of
certain VA benefits by the same percentage and effective on the
same date as adjustments made to title II Social Security
benefits pursuant to section 415(i) of title 42. Proposed new
subsection (d)(2) would specify the VA benefits which would be
covered by the mandated COLA increase. The benefits covered
would be:
1. Basic compensation rates for veterans with
service-connected disabilities and the rates payable
for certain severe disabilities;
2. The allowance for spouses, children, and dependent
parents paid to service-connected disabled veterans
rated 30 percent or more disabled;
3. The annual clothing allowance paid to veterans
whose compensable disability requires the use of a
prosthetic or orthopedic appliance, including a
wheelchair, that tends to tear or wear out clothing or
which requires the use of a medication prescribed by a
physician for a service-connected skin condition if the
medication causes irreparable damage to the veteran's
outergarments; and
4. Dependency and indemnity compensation paid to:
(a) surviving spouses of veterans whose
deaths were service- connected;
(b) surviving spouses for dependent children
below the age of 18;
(c) surviving spouses who are so disabled
that they need aid and attendance or are
permanently housebound;
(d) surviving spouses covered under section
1318 of title 38; and
(e) the children of veterans whose deaths
were service-connected if no surviving spouse
is entitled to DIC, the child is age 18 through
22 and attending an approved educational
institution, or the child is age 18 or over and
became permanently incapable of self-support
prior to reaching age 18.
The proposed new subsection (d)(3) would require VA to
publish any increases under this new authority in the Federal
Register.
The effective date of section 103 of the Committee bill
would be December 1, 2009.
Sec. 104. Conforming amendment relating to non-deductibility from
veterans' disability compensation of disability severance pay
for disabilities incurred by members of the Armed Forces in
combat zones.
Section 104 of the Committee bill would make a technical
correction to eliminate the requirement that severance pay for
a disability incurred in a combat zone be deducted from
disability compensation from VA.
Background. Section 1212 of title 10, United States Code,
stipulates the amount of severance pay available to members of
the Armed Forces who separate due to a disability incurred in
the line of duty. Section 1646 of the Wounded Warrior Act,
title XVI of Public Law 110-181, amended section 1212 to adjust
the computation of the amount of such severance pay and to
eliminate the requirement that severance pay received by
servicemembers for a disability incurred in a combat zone be
deducted from VA compensation.
Section 1161 of title 38, United States Code, stipulates
that the deduction of disability severance pay from disability
compensation shall be made at a monthly rate not in excess of
the rate of compensation to which the individual would be
entitled based on the individual's disability rating. Section
1161 makes reference to subsection 1212(c) of title 10.
However, Public Law 110-181 did not include a conforming
amendment to keep section 1161 consistent with the changes made
to section 1212.
Committee Bill. Section 104 of the Committee bill would
make a conforming amendment, so that section 1161 of title 38
will be consistent with section 1212 of title 10. Section 1646
of the Wounded Warrior Act would be amended by redesignating
subsection (c) as subsection (d) and inserting a new subsection
(c). The new subsection (c) would amend section 1161 of title
38 by striking ``as required by section 1212(c) of title 10''
and inserting ``to the extent required by section 1212(d) of
title 10''. The new subsection (c) would take effect on January
28, 2008, as if it had been included in the Wounded Warrior
Act. As a result, the amended section 1161 of title 38 would
reflect the change to section 1212 of title 10 eliminating the
requirement that severance pay for a disability incurred in a
combat zone be deducted from disability compensation from VA.
Sec. 105. Report on progress of the Secretary of Veterans Affairs in
addressing causes for variances in compensation payments for
veterans for service-connected disabilities.
Section 105 of the Committee bill, which is derived from S.
2951, would require VA to submit a report to Congress
describing its progress in addressing the causes for any
unacceptable variances in compensation payments to veterans.
Background. In 2004, the Chicago Sun-Times ran a series of
articles highlighting evidence of low disability compensation
payments for Illinois veterans compared to veterans from other
states. In response to Congressional requests, VA's Office of
the Inspector General (OIG) conducted an investigation into the
differences in average monthly disability compensation payments
awarded by the various VA regional offices across the country.
OIG concluded that the factors influencing the variations were
complex and intertwined, and included differences in claims
processing practices, disability examinations, timeliness
pressures, staffing levels, and rater experience and training.
OIG also concluded that certain conditions such as Post
Traumatic Stress Disorder, are inherently prone to subjective
rating decisions, leading to inconsistency in the decisions.
OIG recommended that VA further pursue the matter by conducting
a scientifically sound study of the major factors affecting
variances for compensation payments.
VA contracted with the Institute for Defense Analyses (IDA)
to perform the recommended study. IDA made its findings public
in July 2007. IDA identified several main causes for the
variations across states and regional offices. IDA made six
recommendations to VA aimed at aspects of the adjudication
process it believed were most likely to affect the consistency
of claims determinations: standardize initial and on-going
training for rating specialists; standardize the hospital
evaluation reporting process; increase oversight and review of
rating decisions; consider consolidating all or selected parts
of the rating process to one location; develop and implement
metrics to monitor consistency in adjudication results; and
improve and expand data capture and retention.
Then-VA Deputy Under Secretary for Benefits, Ronald R.
Aument, testified before the House Veterans' Affairs
Subcommittee on Oversight and Investigations on October 16,
2007, regarding VA's efforts to address the IDA recommendations
on improving the quality and consistency of the claims process.
Mr. Aument stated that VA concurred with the IDA findings and
had various initiatives underway to support the IDA
recommendations.
Committee Bill. Section 105 of the Committee bill would
require VA to submit a report to the Committees on Veterans'
Affairs of the Senate and the House of Representatives
describing its progress in addressing the causes of
unacceptable variances in compensation payments to veterans for
service-connected disabilities. The report would be due to the
Committees not later than one year after the date of enactment
of this section.
The OIG and IDA reports explored the variances among
various regional offices, identifying many of the factors that
heavily impact the subjective policies, processes, and training
methods of individual regional offices. The report called for
in this section of the Committee bill would require VA to
report to Congress on how it is mitigating the impact of these
variables to ensure that the process is as fair and consistent
as possible, regardless of where the claim is adjudicated.
The Committee bill would require the report to include
three specific elements: (1) a description of the Veterans
Benefits Administration's efforts to coordinate with the
Veterans Health Administration (VHA) to improve the quality of
disability examinations performed by VHA and contract
clinicians, including the use of standardized templates; (2) an
assessment of the current personnel requirements at each
regional office for each type of claims adjudication position;
and (3) a description of the differences, if any, in current
patterns of submittal rates for claims from various segments of
the veterans population, including veterans from rural and
highly rural areas, minority veterans, veterans who served in
the National Guard or Reserve, and military retirees.
Sec. 106. Report on studies regarding compensation of veterans for loss
of earning capacity and quality of life and on long-term
transition payments to veterans undergoing rehabilitation for
service-connected disabilities.
Section 106 of the Committee bill, which is derived from S.
2674, would require VA to provide Congress with a report
regarding the results of a study examining the appropriate
compensation to be provided to veterans for loss of earning
capacity and loss of quality of life caused by service-
connected disabilities and another study examining long-term
transition payments to veterans undergoing rehabilitation for
service-connected disabilities.
Background. In July 2007, the President's Commission on
Care for America's Returning Wounded Warriors recommended that
Congress ``restructure VA disability payments to include * * *
`transition payments.''' Those payments would be equal to three
months of base pay for veterans with disabilities who are not
participating in further rehabilitation and would entail
``longer-term payments to cover family living expenses, if they
are participating in further rehabilitation or education and
training programs.'' The Commission further recommended that
``VA should commission a six-month study to determine the
appropriate level and duration of longer-term transition
payments.'' In addition, the Commission recommended that ``VA
should move swiftly to update (and thereafter keep current) its
disability rating schedule to reflect current injuries and
modern concepts of the impact of disability on quality of
life.''
In February 2008, VA entered into a contract to conduct two
studies on those issues. One study will examine the appropriate
level of disability compensation to be paid to veterans to
compensate for loss of earning capacity and loss of quality of
life as a result of service-related disabilities. The other
study will examine the feasibility and appropriate level of
long-term transition payments to veterans who are separated
from the Armed Forces due to a disability while those veterans
are undergoing a program of rehabilitation. The studies were
due to be completed in August 2008.
Committee Bill. Section 106 of the Committee bill would
require VA to submit to the Committees on Veterans' Affairs of
the Senate and House of Representatives a report including a
comprehensive description of the findings and recommendations
of those studies; a description of the actions proposed to be
taken by VA in light of those findings and recommendations,
including a description of any proposed modifications to the VA
disability rating schedule or to other regulations or policies;
a schedule for the commencement and completion of any actions
proposed to be taken; and a description of any legislative
action required in order to authorize, facilitate, or enhance
any of the proposed actions. That report would be due no later
than 210 days after the date of enactment of the Committee
bill.
TITLE II--HOUSING MATTERS
Sec. 201. Temporary increase in maximum loan guaranty amount for
certain housing loans guaranteed by the Secretary of Veterans
Affairs.
Section 201 of the Committee bill, which is derived from S.
2768, would temporarily increase the maximum loan amount
guaranteed by VA under the VA home loan guaranty program.
Background. The Servicemen's Readjustment Act of 1944,
commonly known as the GI Bill of Rights, was signed into law as
Public Law 78-346 by President Franklin D. Roosevelt on June
22, 1944, and, among other things, provided veterans with
federally guaranteed home loans with no down payment. As World
War II was ending, this landmark legislation made the dream of
home ownership a reality for millions of returning veterans.
They were able to build new homes and otherwise begin new lives
with the assistance of the federal government.
This guaranty may exempt homeowners from having to make a
down payment or secure private mortgage insurance, depending on
the size of the loan and the amount of the VA guaranty. In
general, eligibility is extended to veterans who served on
active duty for a minimum of 90 days during wartime or 181
continuous days during peacetime, and have a discharge other
than dishonorable. Members of the Guard and Reserve who have
never been called to active duty must serve a total of six
years in order to be eligible for the benefit. Certain
surviving spouses are also eligible for the housing guaranty.
Public Law 108-454 increased VA's maximum guaranty amount
to 25 percent of the Freddie Mac conforming loan limit
determined under section 305(a)(2) of the Federal Home Loan
Mortgage Corporation Act for a single family residence, as
adjusted for the year involved.
The Economic Stimulus Act of 2008 (Stimulus Act), Public
Law 110-185, temporarily reset the maximum limits on home loans
that the Federal Housing Administration (FHA) may insure and
that Fannie Mae and Freddie Mac may purchase on the secondary
market to 125 percent of metropolitan-area median home prices,
but did so without reference to the VA home loan program. This
had the effect of raising the Fannie Mae, Freddie Mac, and FHA
limits to nearly $730,000, in the highest cost areas, while
leaving the then-VA limit of $417,000 in place.
On July 30, 2008, the Housing and Economic Recovery Act of
2008 was signed into law as Public Law 110-289. That law
provided a temporary increase in the maximum guaranty amount
for VA loans originated from July 30, 2008 through December 31,
2008 to the same level as provided in the Stimulus Act.
Committee Bill. Section 201 of the Committee bill, in a
freestanding provision, would apply the temporary increase in
the maximum guaranty amount until December 31, 2011. This would
enable more veterans to utilize their VA benefit to purchase
more costly homes.
Sec. 202. Enhancement of refinancing of home loans by veterans.
Section 202 of the Committee bill, which is derived from S.
2961, would increase the maximum guaranty limit for refinance
loans and increase the percentage of an existing loan that VA
will refinance under the VA home loan program.
Background. Under section 3703(a)(1)(A)(i)(IV) of title 38,
United States Code, the maximum VA home loan guaranty limit for
most loans in excess of $144,000 is equal to 25 percent of the
Freddie Mac conforming loan limit for a single family home.
Public Law 110-289 set this value at approximately $182,437
through the end of 2008. This means lenders making loans up to
$729,750 will receive at least a 25 percent guaranty, which is
typically required to place the loan on the secondary market.
Under current law, this does not include regular refinance
loans.
Section 3703(a)(1)(B) of title 38 limits to $36,000 the
guaranty that can be used for a regular refinance loan. This
restriction means a regular refinance over $144,000 will result
in a lender not receiving 25 percent backing from VA. In this
situation, the lender is less likely to make the loan to the
veteran. This situation essentially precludes a veteran from
being able to refinance his or her existing FHA or conventional
loan into a VA guaranteed loan if the loan is greater than
$144,000.
Under section 3710(b)(8) of title 38, VA is also precluded
from refinancing a loan if the homeowner does not have at least
ten percent equity in his or her home.
Committee Bill. Subsection 202(a) of the Committee bill
would raise the guaranty on VA refinance loans to the same
level as conventional loans, which is 25 percent of the Freddie
Mac conforming loan limit for a single family home.
Subsection 202(b) would decrease equity requirements from
90 percent to 95 percent for refinancing from an FHA loan or
conventional loan to a VA-guaranteed loan. This will allow more
veterans to use their VA benefit to refinance their mortgages.
Many veterans do not have ten percent equity and thus are
precluded from refinancing to a VA-guaranteed home loan.
Given the anticipated number of non-VA-guaranteed
adjustable mortgages that are approaching the reset time when
payments are likely to increase, the Committee believes that it
is prudent to facilitate veterans refinancing to VA-guaranteed
loans. In light of today's housing and home loan crises,
additional refinancing options will help some veterans to
bridge financial gaps and allow them to stay in their homes and
escape possible foreclosures. These provisions would allow more
qualified veterans to refinance their home loans under the VA
program.
Sec. 203. Four-year extension of demonstration projects on adjustable
rate mortgages.
Section 203 of the Committee bill, which is derived from S.
3087, would extend VA's authority to guaranty adjustable rate
mortgages and hybrid adjustable rate mortgages.
Background. Current law, section 3707(a) of title 38,
United States Code, authorizes VA, through fiscal year 2008, to
guaranty adjustable rate mortgages (ARMs). ARMs are loans with
interest rates that change. Lenders generally charge lower
initial interest rates for ARMs than for fixed-rate mortgages.
An ARM allows a borrower to receive a lower initial interest
rate for assuming the risk that the interest rate could go up.
Public Law 102-547, the Veterans Home Loan Program Amendments
of 1992, initially authorized a three-year test of a VA-
guaranteed ARM program modeled after the Federal Housing
Administration's ARM program. Section 404 of Public Law 108-454
authorized an extension of the VA program through fiscal year
2008.
Section 3707A(a) of title 38 authorizes VA, through fiscal
year 2008, to guarantee so-called ``hybrid'' adjustable rate
mortgages (hybrid ARMs). Hybrid ARMs are loans that carry a
fixed rate of interest for an initial period followed by annual
interest rate adjustments thereafter. Section 303 of Public Law
107-330 first authorized this demonstration project. Section
405 of Public Law 108-454 authorized an extension through
fiscal year 2008.
Since the inception of VA's authority to guaranty ARMs and
hybrid ARMs, VA has guaranteed over 230,000 ARMs and hybrid
ARMs, 9 percent of VA's home loan guaranty activity.
Committee Bill. Subsection 203(a) of the Committee bill
would amend section 3707(a) of title 38 so as to extend VA's
ARM program through fiscal year 2012. Subsection 203(b) of the
Committee bill would amend section 3707A(a) of title 38 so as
to extend VA's demonstration project on hybrid ARMs through
fiscal year 2012.
The Committee recognizes that these programs have proven to
be an important part of VA's home loan guaranty program and
expects to continue to make these loan options available to
those eligible for a VA-guaranteed loan.
Sec. 204. Eligibility for specially adapted housing benefits and
assistance for members of the Armed Forces with service-
connected disabilities.
Section 204 of the Committee bill, which is derived from S.
2984, would authorize VA to provide specially adapted housing
assistance under chapter 21 of title 38, United States Code, to
active duty servicemembers with severe disabilities incurred or
aggravated in the line of duty in the active military, naval,
or air service.
Background. Section 2101 of title 38 permits VA to assist
veterans who have certain permanent and total service-connected
disabilities acquire housing with special features or adapt
their existing residences with special features. These special
features are those that are deemed appropriate by VA to assist
the veteran in living independently with the qualifying
service-connected disability. Under current law, veterans with
certain severe service-connected disabilities are eligible to
receive grants of up to either $10,000 or $50,000, depending on
the nature of the disability.
Section 2101 includes authority to grant these benefits to
members of the Armed Forces serving on active duty who are
similarly disabled as the result of an injury incurred or
disease aggravated in the line of duty in the active military,
naval, or air service. Eligibility of members of the Armed
Forces is subject to the same criteria and conditions as the
eligibility of veterans.
However, other sections of chapter 21 of title 38 do not
contain language that explicitly makes these provisions
applicable to members of the Armed Forces. Most notably,
section 2102A, which provides certain assistance to veterans
residing temporarily in housing owned by a family member, is
not currently available to members of the Armed Forces.
Committee Bill. Section 204 of the Committee bill would
eliminate this disparity by providing, in a free-standing
provision, explicit authority to VA to provide all specially
adapted housing benefits under chapter 21 of title 38 to
eligible members of the Armed Forces on active duty.
Sec. 205. Report on impact of mortgage foreclosures on veterans.
Section 205 of the Committee bill, which is derived from S.
2981, would require VA to provide Congress with a report on the
impact of the recent mortgage foreclosure crisis on veterans.
Background. The recent troubles in the subprime mortgage
industry have led to rising foreclosure rates across the
country. The most recent data from RealtyTrac, the largest
national database of foreclosures and bank-owned properties,
shows that there were 252,363 foreclosures filings on U.S.
properties in June 2008, a 53 percent increase over the number
of filings in June 2007. That amounts to a foreclosure filing
on one of every 501 U.S. households during the month of June
2008. According to data from the Mortgage Bankers Association,
the rate of foreclosure starts and the percent of loans in the
process of foreclosure were at their highest recorded levels
since 1979 during the first quarter of 2008.
The increase in foreclosures is also a matter of concern
for veterans, particularly those who have recently separated
from the military after deployments in Operation Enduring
Freedom and Operation Iraqi Freedom. The Congressional Joint
Economic Committee announced on June 12, 2008, that research
conducted by Committee staff in cooperation with RealtyTrac
found significantly higher foreclosure rates in the areas
surrounding the 24 military bases with the highest personnel
populations.
Committee Bill. Section 205 of the Committee bill would
require that VA investigate and report on the impact of the
mortgage foreclosure crisis on veterans and the adequacy of
existing mechanisms available to help veterans. Section 205
would require the report to include four specific elements: (1)
a general assessment of the income of veterans who have
recently separated from the Armed Forces; (2) an assessment of
the effects of the length of the disability adjudication
process on the capacity of veterans to maintain adequate or
suitable housing; (3) a description of the extent to which the
provisions of Servicemembers Civil Relief Act (SCRA) currently
protect veterans from mortgage foreclosure; and (4) a
description and assessment of the adequacy of the VA home loan
guaranty program in preventing foreclosure for recently
separated veterans. The report would be due to the Committees
on Veterans' Affairs of the Senate and the House of
Representatives no later than December 31, 2009.
TITLE III--LABOR AND EDUCATION MATTERS
SUBTITLE A--LABOR AND EMPLOYMENT MATTERS
Sec. 301. Waiver of 24-month limitation on program of independent
living services and assistance for veterans with a severe
disability incurred in the Post-9/11 Global Operations period.
Section 301 of the Committee bill would expand VA's
authority to waive the 24-month limit on independent living
services that may be provided to veterans of the Post-9/11
Global Operations period.
Background. Under current law, VA may provide services to
certain veterans with severe service-connected disabilities to
help them achieve maximum independence in daily living. The
general rule is that no more than 24-months of these services
may be provided to a veteran. However, under section 3105(d) of
title 38, United States Code, the period may be extended if
``the Secretary determines that a longer period is necessary
and likely to result in a substantial increase in a veteran's
level of independence in daily living.''
Committee Bill. Section 301 of the Committee bill would
amend section 3105(d) of title 38 so as to allow VA, without
having to make such a determination, to extend the 24-month cap
on independent living services for any veteran who served on
active duty during the Post-9/11 Global Operations period and
incurred or aggravated a severe disability during that service.
In the view of the Committee, this additional flexibility will
help ensure that VA is able to provide the appropriate services
to veterans with severe disabilities, such as traumatic brain
injury (TBI), that may have lengthy, complex, and unpredictable
recovery periods.
Sec. 302. Reform of USERRA complaint process.
Section 302 of the Committee bill, which is derived from S.
2471, would create deadlines for the Department of Labor, the
Attorney General, and the Office of Special Counsel to provide
assistance to servicemembers who believe that their rights
under the Uniformed Services Employment and Reemployment Rights
Act of 1994 have been violated.
Background. USERRA, chapter 43 of title 38, United States
Code, provides reemployment and employment rights to
servicemembers, veterans, and those who seek to join a
uniformed service. USERRA encourages Americans to serve in the
Armed Forces and reduces the disruption that servicemembers
face when returning to the civilian workforce. Because the
National Guard and Reserves have become an essential part of
the military's operational force, it is imperative that
employers comply with USERRA and that the statute be rigorously
enforced by the federal government. If individuals lack
confidence that their USERRA rights will be respected or
enforced, they will be far less likely to join or continue to
serve in the Armed Forces, especially in the Reserve forces.
Individuals can privately enforce their rights under USERRA
by filing a complaint in federal or state court, or, in the
case of a complaint against a federal employer, by submitting a
complaint to the Merit Systems Protection Board (MSPB). In
addition, individuals can request assistance from the federal
government by filing a complaint with the Department of Labor's
Veterans' Employment and Training Service (DOL VETS), which
investigates and attempts to resolve complaints, and, if
requested, will refer complaints for litigation. DOL VETS
refers complaints against federal agencies to the Office of
Special Counsel (OSC) and complaints against private sector
employers and state and local governments to the Attorney
General. The Special Counsel or Attorney General may represent
individuals before the MSPB or in federal court, respectively.
Although the sample size was small and the margin of error
high, the Department of Defense's 2006 Status of Forces Survey
of Reserve Component Members does suggest that some
servicemembers are increasingly dissatisfied with federal
enforcement of USERRA and, in particular, the length of time it
takes for USERRA claims to be investigated and resolved or
referred for litigation. From 2004 to 2006, the percentage of
Reserve Component members who responded that they were
dissatisfied with how their complaints were handled by DOL VETS
increased from 27 to 44 percent. During the same period, the
percentage of those who said that the government's response to
their complaints was not prompt rose from 32 to 38 percent.
The Government Accountability Office (GAO) has also found
significant delays in the handling of USERRA complaints. In its
July 2007 report, ``Military Personnel, Improved Quality
Controls Needed over Servicemembers' Employment Rights Claims
at DOL,'' GAO found that in the six cases when DOL VETS could
not resolve complaints of federal employees, who then sought
referrals for litigation, an average of eight months was
required for DOL VETS to both investigate and refer those
complaints to OSC. Id. at 23. In addition, GAO estimated that
the average processing time of all USERRA complaints received
by DOL VETS ranged from 53 to 86 days, and concluded that the
reporting on the number and percentage of claims it closes
within 90, 120, and 365 days, was not reliable. In one case,
DOL VETS did not refer the case for litigation until seven
years after a complaint was filed.
Committee Bill. Section 302 of the Committee bill would
amend a number of sections in chapter 43 of title 38 so as to
expedite federal enforcement of USERRA by imposing deadlines on
action by DOL VETS, OSC, and the Attorney General to complete
the tasks assigned to them under the statute:
Within 5 days of receiving a USERRA complaint, DOL
VETS would be required to notify a complainant in writing about
his or her rights to receive governmental assistance, including
the right to request a referral and the relevant deadlines that
the federal agencies must meet.
Within 90 days of receiving the complaint, DOL
VETS would be required to complete its assistance and
investigation and notify the complainant of the results and his
or her rights, including the right to request a referral and
the deadlines federal agencies must meet.
Within 48 days after receiving a request for a
referral, DOL would be required to refer a complaint to the OSC
or the Attorney General.
Within 60 days of receiving a referral, OSC or the
Attorney General would be required to determine whether to
provide legal representation to the complainant and notify the
complainant of that decision in writing.
These deadlines are not intended to adversely affect or
diminish any of the rights of an individual to enforce his or
her rights under USERRA or the ability of the government to
enforce the rights of the servicemember. Nor are the deadlines
intended to constitute or create any type of defense that an
employer could raise in a judicial or administrative
proceeding, or to deprive the MSPB, a federal court, or a state
court of jurisdiction over a complaint or action filed under
USERRA. Moreover, if the Secretary, the Attorney General, or
the Special Counsel is unable to complete a specific task by
the relevant deadline, the agency may complete the task within
a time period agreed to by the complainant and the agency.
Subsection 302(f) of the Committee bill would clarify that
the original intent of Congress was that USERRA would not be
subject to a federal or state statute of limitations period and
specifically states that there is no time limit for a person to
file a complaint with the Secretary of Labor, or for a person
or the United States to submit a complaint before the MSPB or
to file an action in federal or state court. The application of
a federal statute of limitation period under USERRA is
inconsistent with the intent of Congress and contrary to the
Department of Labor's longstanding ``position that no Federal
statute of limitations applied to actions under USERRA.'' U.S.
Department of Labor, ``Uniformed Services Employment and
Reemployment Rights Act of 1994; Final Rules,'' 70 Fed. Reg.
75246, 75287 (Dec. 19, 2005). This section of the Committee
bill would implement the Department of Labor's recommendation
that Congress ``consider amending USERRA to clarify that no
statute of limitations may apply to USERRA.'' U.S. Department
of Labor, 2006 Fiscal Year Annual Report to Congress, at 7
(Feb. 2008) (stating that a least one federal court has applied
the four-year residual statute of limitations period in 28
U.S.C. Sec. 1658 to proceedings under USERRA, and citing Rogers
v. City of San Antonio, 2003 WL 1566502, *7 (W.D. Tex.),
reversed on other grounds, 392 F.3d 758 (5th Cir. 2004)).
Sec. 303. Modification and expansion of reporting requirements with
respect to enforcement of USERRA.
Section 303 of the Committee bill, which is derived from S.
2471, would expand the reporting requirements regarding the
federal government's enforcement of USERRA and change the date
that the Department of Labor's annual USERRA report is due from
February 1 to July 1.
Background. Under current law, the Secretary of Labor must
file an annual report to Congress that includes the number of
cases reviewed by DOL VETS and the Department of Defense
Employer Support of the Guard and Reserve (DoD ESGR), the
number of cases referred to OSC and the Attorney General, and
the number of complaints filed by the Attorney General.
In February 2007, GAO published a report, ``Military
Personnel: Additional Actions Needed to Improve Oversight of
Reserve Employment Issues.'' GAO found that ``[t]he four
agencies * * * responsible for addressing and tracking USERRA
claims cannot systematically record and track disability-
related employment complaints,'' in particular because ``they
do not record disability-related complaints using consistent
and compatible categories to allow information analysis and
reporting.'' GAO concluded that the failure to consistently
track disability-related complaints may result in
underreporting of the number of disability-related USERRA
complaints, and that the Department of Defense (DOD) ``may not
be completely aware of the effect that disabilities incurred by
reservists while on active duty have on their reemployment, and
what additional assistance may be needed to help transition
this population back into the workforce.'' Moreover, GAO found
that this lack of consistency was indicative of a more general
problem that USERRA complaints ``could not be uniformly
categorized in order to reveal trends on the kinds of problems
that returning reservists experience because the four USERRA
agencies responsible for addressing complaints use different
complaint categories to characterize these issues.''
Committee Bill. Section 303 of the Committee bill would
amend section 4332 of title 38, United States Code, to expand
the federal government's reporting requirements with regard to
enforcement of USERRA.
Section 4332 requires the Department of Labor to report the
number of complaints the Attorney General files in federal
courts, but does not require reporting of the number of cases
OSC initiates before the MSPB. Section 303 would eliminate this
difference by requiring reporting on the number of cases OSC
initiates before the MSPB.
Section 303 of the Committee bill would also require
reports of the number of individuals whose cases are reviewed
by both DOD ESGR and the DOL VETS so that the agencies
responsible for enforcing USERRA can understand how frequently
aggrieved servicemembers seek assistance from both DOD ESGR and
DOL VETS and what types of cases are more likely to require
assistance from both agencies. The Department of Labor would be
required to report the number of cases handled by DOD ESGR, DOL
VETS, OSC, and the Attorney General that involve a disability-
related issue and the number of cases that involve a person
with a service-connected disability. In addition, section 303
would require the Department of Labor to ensure that all of the
information collection and reporting of USERRA cases is done in
a uniform and consistent manner.
Finally, section 303 would require the Department of Labor,
OSC, and the Attorney General to issue quarterly reports on
their compliance with the new deadlines that would be set by
section 302 of the Committee bill, and it would require the
Comptroller General to issue a report within two years
assessing the reliability of the information in the three
agencies' quarterly reports and the extent to which the three
agencies are meeting those deadlines.
Sec. 304. Training for executive branch human resources personnel on
employment and reemployment rights of members of the uniformed
services.
Section 304 of the Committee bill would require human
resources personnel employed by Federal executive agencies to
receive training regarding USERRA.
Background. USERRA, which is codified in chapter 43 of
title 38, United States Code, protects the public and private
sector civilian job rights and benefits of veterans and members
of the Armed Forces, including National Guard and Reserve
members. USERRA also prohibits employer discrimination due to
military obligations and provides reemployment rights to
returning servicemembers.
In October 2007, the Committee conducted an oversight
hearing regarding USERRA. According to testimony provided at
that hearing, when Federal executive agencies violate USERRA,
it is often due to a lack of knowledge or understanding about
the law. In fact, The Honorable Charles Ciccolella, Assistant
Secretary for Veterans' Employment and Training, U.S.
Department of Labor, testified that ``about half the [USERRA]
cases that we do in the Federal government is where the Federal
hiring manager just doesn't understand the law or the [Office
of Personnel Management] regulations that spell out how to
implement the law.''
Committee Bill. Section 304 of the Committee bill would
amend chapter 43 of title 38 to add a new section 4335, which
would require the head of each Federal executive agency to
provide training for human resources personnel on the rights,
benefits, and obligations of members of the Armed Forces under
USERRA and the administration of USERRA by Federal executive
agencies. It would require that the training be developed and
provided in consultation with the Office of Personnel
Management. The training would be provided as often as
specified by the Director of the Office of Personnel Management
in order to ensure that the human resources personnel are kept
fully and currently informed about USERRA.
Sec. 305. Report on the employment needs of Native American veterans
living on tribal lands.
Section 305 of the Committee bill, which is derived from S.
3000, would require the Department of Labor, in consultation
with the Departments of Veterans Affairs and the Interior, to
submit a report assessing the employment needs of Native
American (American Indian, Alaska Native, Native Hawaiian, and
other Pacific Islander) veterans living on tribal lands,
including Indian reservations, Alaska Native villages, and
Hawaiian Home Lands.
Background. According to a 2006 VA report entitled
``American Indian and Alaska Native Veterans: Lasting
Contributions'', which relied on data from the 2000 Census, the
unemployment rate among American Indian and Alaska Native
veterans was approaching twice the unemployment rate among all
veterans. For those Native American veterans who return to
their native communities, their employment status may be much
worse. According to the 2003 American Indian Population and
Labor Force Report published by the Bureau of Indian Affairs,
on-reservation or near-reservation unemployment was 49 percent.
While these statistics indicate a clear employment problem for
Native American veterans, especially those residing in Native
American communities, the Committee is in need of more
information to determine the appropriate steps that need to be
taken to address the problem. Additionally, the Committee seeks
to learn how existing employment resources for veterans can be
leveraged in Native American communities to assist Native
American veterans.
Committee Bill. Section 305 of the Committee bill would
require the Secretary of Labor, in consultation with the
Secretaries of Veterans Affairs and the Interior, to provide a
report on the employment needs of Native Americans, including a
review of current and prior government-to-government
relationships between tribal organizations, as defined in
section 3765 of title 38, which the Committee expects would
include a discussion of the current and projected activities
within DOL VETS. The report would also be required to include
recommendations for improving employment and job training
opportunities for Native American veterans on tribal land,
especially through the utilization of resources for veterans.
The report would be due to the Committees on Veterans' Affairs
of the Senate and House of Representatives no later than
December 1, 2009.
Sec. 306. Report on measures to assist and encourage veterans in
completing vocational rehabilitation.
Section 306 of the Committee bill, which is derived from S.
2674, would require VA to conduct a study on factors that may
prevent veterans with service-connected disabilities from
completing their vocational rehabilitation plans and measures
that could be taken to assist and encourage veterans in
completing vocational rehabilitation.
Background. In its July 2007 report, the President's
Commission on Care for America's Returning Wounded Warriors
found that, ``of the 65,000 who apply for [VA's Vocational
Rehabilitation and Employment program] each year, at most
10,000 of all ages complete the employment track in the program
each year.'' The Commission also found that ``the effectiveness
of various vocational rehabilitation programs is not well
established, and the VA should undertake an effort to determine
which have the greatest long-term success.'' In addition, the
Commission recommended that ``VA should develop financial
incentives that would encourage completion'' of vocational
rehabilitation.
Committee Bill. Section 306 of the Committee bill would
require VA to conduct a study that would identify the various
factors that may prevent or preclude veterans from successfully
completing their vocational rehabilitation plans. It would also
require identification of actions that the Secretary may take
to address such factors.
In conducting the study, VA would be required to examine
the measures utilized in other disability systems in the United
States and in other countries to encourage successful
completion of vocational rehabilitation; any relevant studies
or survey data; the extent to which disability compensation may
be used as an incentive to encourage veterans to undergo and
complete their vocational rehabilitation programs; the report
of the Veterans' Disability Benefits Commission; the report of
the President's Commission on Care for America's Returning
Wounded Warriors; and any other matters that VA considers
appropriate. In addition, VA would address the extent to which
bonus payments or other incentives may be used to encourage
veterans to complete their vocational rehabilitation plans or
otherwise achieve their vocational rehabilitation objectives.
VA would be required to consult with veterans and military
service organizations and any other organizations or
individuals as VA deems appropriate and would be authorized to
employ consultants.
Finally, not later than 270 days after beginning the study,
VA would be required to submit to the Committees on Veterans'
Affairs of the Senate and House of Representatives a report
including the findings of the study and any recommendations on
actions that should be taken in light of the study.
SUBTITLE B--EDUCATION MATTERS
Sec. 311. Relief for students who discontinue education because of
military service.
Section 311 of the Committee bill, which is derived from S.
1718, would amend title VII of the Servicemembers Civil Relief
Act (50 U.S.C. App. 591 et seq.), to provide protections for
servicemembers who are called to active-duty service while
enrolled in institutions of higher education.
Background. Under the law as it was at the time the
Committee met to mark up the Committee bill, there was no
uniform financial protection for servicemembers who are called
to active duty and are required to discontinue a program of
education prior to the completion of the academic semester or
quarter for which they are enrolled. Colleges and universities
were not required to make reasonable accommodations for
students who are called to active duty in the Armed Forces,
such as tuition reimbursement and requirements for
reenrollment. Members of the Armed Forces who return from
deployment overseas and attempt to reenroll in a program of
education could be overwhelmed with bureaucracy. In addition,
the six-percent interest rate cap on all debts of members of
the Armed Forces called to active duty guaranteed by the
Servicemembers Civil Relief Act had been interpreted by the
Secretary of Education not to apply to Federal student loans.
Since the time of the Committee's meeting on June 26, 2008,
the Higher Education Opportunity Act was signed on August 14,
2008, and became Public Law 110-315. This new Public Law
contains provisions addressing some of the same concerns
intended to be addressed by the Committee bill, including
reasonable accommodations and the cap on interest rates for
Federal student loans. Any future action on the Committee bill
will reflect the changes made by Public Law 110-315.
Committee Bill. Section 311 of the Committee bill would
require institutions of higher education to refund tuition and
fees paid by a servicemember for courses not completed due to
performance of military obligations. It would also provide that
the interest rate for Federal student loans would be held at no
more than six percent during such obligations.
This would assist members of the Armed Forces who return
from a deployment to make the transition from military service
to civilian life and who wish to re-enter programs of education
they were forced to discontinue because of such deployment. It
would further provide the service member an opportunity to
reenroll at the institution with the same educational and
academic status that the service member had when the program
was discontinued because of the military service. It would also
provide parity with other loan obligations that can are reduced
during periods of service.
Some colleges and universities have wide ranging policies
currently in place to minimize the academic impact of leaving
for active duty service, including suspending the requirement
that they reapply for admission and waiving changes to degree
requirements. The Committee does not intend that policies and
procedures currently in place at colleges and universities
would be superseded by the requirements of these new
protections.
Sec. 312. Modification of period of eligibility for Survivors' and
Dependents' Educational Assistance of certain spouses of
individuals with service-connected disabilities total and
permanent in nature.
Section 312 of the Committee bill would extend the period
within which the spouses of certain severely disabled veterans
must use education benefits from VA.
Background. Under the Survivors' and Dependents'
Educational Assistance (DEA) program, VA provides up to 45
months of education benefits to certain children or spouses of
military personnel. For instance, the spouse of a veteran or
servicemember may be eligible for these benefits if the veteran
died, or is permanently and totally disabled, as the result of
a service-connected disability or if the veteran died from any
cause while a permanent and total service-connected disability
was in existence.
The spouse generally must use these education benefits
within ten years after the date on which the veteran dies or is
found to be permanently and totally disabled. However, if the
servicemember died while on active duty, the spouse may use the
education benefits during the twenty-year period after the
servicemember's death. That extended period was meant to
recognize the struggles of a surviving spouse in the years
following the loss of the servicemember. As this Committee
explained: ``For spouses with children, especially young
children, using DEA benefits within the [ten-year] period may
be difficult * * * A host of factors may preclude the use of
DEA benefits during the ten-year period following a
servicemember's death, such as an extended grieving process,
job demands, or simply the lack of an immediate need for
education or training.'' S. Rep. 108-352, at 10 (2004).
In recent years, it has become clear that the families of
those who are severely wounded in service may also face
significant challenges in the years following the injuries. For
example, the July 2007 report of the President's Commission on
Care for America's Returning Wounded Warriors contained these
findings regarding the family members of servicemembers who
survive devastating injuries, such as TBI: ``The Commission has
repeatedly heard about dedicated family members whose
financial, family, and professional sacrifices allowed them to
participate in their loved one's TBI care. Some patients with
severe TBI may need family members or others to provide care
for an extended period.''
Committee Bill. Section 312 of the Committee bill would
extend from ten years to twenty years the time within which the
spouses of certain severely injured veterans have to use their
DEA benefits. Specifically, the twenty-year period would be
available to a spouse of a veteran who becomes permanently and
totally disabled within three years after discharge from
service, if the spouse remains married to the injured veteran.
In the view of the Committee, this extension is necessary to
recognize that the extensive time and effort spent caring for a
severely injured veteran may preclude a spouse from using DEA
benefits during the existing ten-year period.
Sec. 313. Repeal of requirement for report to the Secretary of Veterans
Affairs on prior training.
Section 313 of the Committee bill, which is derived from S.
2984, would eliminate the current requirement that educational
institutions providing non-accredited courses report to VA any
credit that was granted by that institution for an eligible
person's prior training.
Background. Under current law, State approving agencies
approve, for VA education benefits purposes, the application of
educational institutions providing non-accredited courses if
the institution and its courses meet certain criteria. Among
these is the requirement that the institution maintain a
written record of the previous education and training of the
eligible person and what credit for that training has been
given the individual. The institution must notify both VA and
the eligible person regarding the amount of credit the school
grants for previous training.
Committee Bill. Section 313 of the Committee bill would
amend section 3676(c)(4) of title 38, United States Code, to
eliminate the notification requirement as it pertains to VA. VA
will maintain oversight, just as it does with accredited
courses. VA will review records during compliance visits to
assure the institution is evaluating and appropriately reducing
program requirements because of credit given for prior
training.
Removing the reporting requirement would shorten claims
processing time because VA would not have to review each claim
for the presence of such notice and, if submitted, have to
check with the school and student to assure the requirement has
been met. It would also permit more cases to be processed
through VA's Electronic Certification Automated Processing
(ECAP) program. The ECAP system cannot process claims where
proper credit reporting is at issue because those cases require
manual development and review by a veteran's claims examiner.
The more claims VA can process through the ECAP system, the
more timely VA beneficiaries will receive their benefits.
Following up with schools for the written notification
burdens the school certifying official and student, as well as
VA. Often, the school certifying official, who is responsible
for reporting a veteran's enrollment, is not the individual who
evaluates credit. The certifying official has no control over
how long it takes the school to accomplish the review and
granting of prior credit.
Further, several of VA's stakeholders, including the
National Association of Veterans' Program Administrators, have
recommended that VA review school records to determine granting
of prior credit during compliance visits rather than require
the school to submit written reports. Eliminating this
requirement would streamline the administration of educational
assistance benefits, and improve the delivery of benefits to
veterans, reservists, and other eligible individuals.
Sec. 314. Modification of waiting period before affirmation of
enrollment in a correspondence course.
Section 314 of the Committee bill, which is derived from S.
2984, would reduce from ten to five days the waiting period
required prior to the student's affirmation of an enrollment
agreement with an educational institution to pursue a program
of education exclusively by correspondence.
Background. Under current law, an enrollment agreement
signed by a veteran, spouse, or surviving spouse will not be
effective unless he or she, after ten days from the date of
signing the agreement, submits a written and signed statement
to VA affirming the enrollment agreement. In the event the
individual at any time notifies the institution of his or her
intention not to affirm the agreement, the institution, without
imposing any penalty or charging any fee, shall promptly make a
refund of all amounts paid.
Committee Bill. Section 314 of the Committee bill would
amend section 3686(b) of title 38, United States Code, to
reduce the required waiting period from ten to five days. The
statutory ten-day period is twice the requirement of the
Distance Education and Training Council (DETC) accrediting body
standard, which states that institutions will allow a full
refund of all tuition expenses paid if a student cancels within
five days after enrolling in a course. Reducing the affirmation
waiting period to five days would make the statute consistent
with the DETC standard and eliminate confusion. It would also
permit eligible individuals to begin their programs sooner.
Should they decide at any time not to affirm the enrollment
agreement, the eligible individuals would still be entitled to
a refund of all amounts paid. Finally, this proposal would
allow VA to strengthen its partnership with the National
Association of State Approving Agencies which has had this
issue high on its list of legislative priorities.
Sec. 315. Change of programs of education at the same educational
institution.
Section 315 of the bill, which is derived from S. 2984,
would eliminate the requirement that an individual must file an
application with VA when changing programs of study while
enrolled at the same school.
Background. Under current law, a student who desires to
initiate a program of education must submit an application to
VA in the form prescribed by the Department. If the student
decides a different program is more advantageous to his or her
needs, that individual may change his or her program of study
once. However, additional changes require VA to determine that
the change is suitable to the individual's interests and
abilities. It is rare for VA to deny a change of program,
especially if the student is continuing in an approved program
at the same school.
Committee Bill. Section 315 of the Committee bill, would
amend section 3691(d) of title 38, United States Code, to
eliminate the student application requirement. Under the new
procedure, VA would accept the new program enrollment based on
the certification of such enrollment from the school without
requiring an additional certification from the student. VA
would still have oversight of program changes by reviewing
school records during compliance visits and would apply only if
the individual remains enrolled at the same school. This new
procedure should allow VA to increase the number of claims
processed using the ECAP program without manual review by a
veterans claims examiner--resulting in more timely awards and
less of a information collection burden.
Sec. 316. Repeal of certification requirement with respect to
applications for approval of self-employment on-job training.
Section 316 of the Committee bill, which is derived from S.
2984, would eliminate the requirement that wages be earned by
veterans pursuing self-employment on-job training (OJT)
authorized under section 301 of Public Law 108-183.
Background. Section 301 of Public Law 108-183 expanded the
chapter 30 Montgomery GI Bill program by authorizing
educational assistance benefits for full-time OJT of less than
six months needed for obtaining licensure to engage in a self-
employment occupation or required for ownership and operation
of a franchise. Under current law, all provisions of title 38,
United States Code, that apply to VA's other OJT programs
(except the requirement that a training program has to be for
at least six months) apply to franchise-ownership OJT,
including the requirement that the trainee earn wages that are
increased on an incremental basis.
Committee Bill. Section 316 of the Committee bill would
amend section 3677(b) of title 38, United States Code, to
exempt self-employment OJT from the wage-earning requirement.
Through contact with the International Franchise Association,
VA has determined that OJT for new franchise owners does not
involve the payment of wages. Thus, if franchise OJT programs
are not exempted from the current title 38 wage requirements,
no franchise-ownership OJT program could be approved for VA
benefits.
SUBTITLE C--OTHER MATTERS
Sec. 321. Designation of the Office of Small Business Programs of the
Department of Veterans Affairs.
Section 321 of the Committee bill, which is derived from S.
2984, would designate VA's office established to support
contracting with small businesses as the Office of Small
Business Programs.
Background. Section 15(k) of the Small Business Act,
codified at section 644(k) of title 15, United States Code,
established, in each federal agency having procurement powers,
including VA, an office to support contracting with small
businesses to be known as the ``Office of Small and
Disadvantaged Business Utilization.''
Committee Bill. Section 321 of the Committee bill would
designate the office established under section 15(k) of the
Small Business Act as the Office of Small Business Programs of
the Department of Veterans Affairs. The head of the office
would be designated as the Director of Small Business Programs.
Designating the office as the Office of Small Business
Programs would more clearly represent that office's span of
authority. The name would not reflect any change in emphasis or
support for disadvantaged small businesses, but rather would
clarify that the Office of Small Business Programs has the full
range of authority over many other small business programs. The
new title would capture the overarching nature of the program,
which encompasses the small disadvantaged business, the
service-disabled veteran-owned small business, the veteran-
owned small business, the qualified historically underutilized
business zone small business, the women-owned small business,
and the very small business programs.
TITLE IV--COURT MATTERS
Sec. 401. Increase in number of active judges on the United States
Court of Appeals for Veterans Claims.
Section 401 of the Committee bill, which is derived from S.
2091, would increase the number of active judges on the United
States Court of Appeals for Veterans Claims from seven to nine.
Background. Under current law, section 7253(a) of title 38,
the court is limited to seven active judges.
Over recent years, the Court has experienced a dramatic
increase in cases filed. For example, in Fiscal Year (FY) 2004
the Court received 2,234 new cases, in FY 2005 that number grew
to 3,466, in FY 2006 it was 3,729, and in FY 2007 new appeals
filed totaled 4,644. This trend has continued into FY 2008.
According to the Court's most recent quarterly report, covering
April 1, 2008 to June 30, 2008, the Court received 1,019 cases.
As these statistics and the Court's annual report depict,
that increase amounts roughly to a jump from less than 200
cases filed per month to well over 300 cases filed per month.
Likewise, the number of cases decided has grown from 1,780 in
FY 2004, to an all-time high of 4,877 in FY 2007.
In considering what should be the number of active judges
for CAVC, the Committee believes it is appropriate to consider
the Judicial Conference's process for recommending additional
judgeships for other federal courts. While CAVC is a federal
Article I court, and thus not a member of the Judicial
Conference, the Court has adopted many of the practices and
processes of the Judicial Conference and the Administrative
Office of the United States Courts.
The Judicial Conference, in making recommendations to
Congress on authorization of judgeships, uses a combination of
objective and discretionary criteria. The Conference relies on
past trends and current data, and does not consider projected
future caseloads because they do not utilize predictors of
future filings. It initially reviews the case statistics of a
particular court to determine whether the amount of work
justifies adding judicial resources and, if so, whether that
addition should be permanent or temporary. The Conference uses
a formula that assigns varying weight to different types of
cases at the trial level, and considers a reasonable caseload
of 430 weighted cases per district court judge; it uses 500
weighted filings per three-judge appellate panel as a
reasonable workload.
CAVC is an unusual appellate tribunal in that it sits both
in panels in some instances, like most other appellate bodies,
and also has authority to decide appeals by a single judge.
Based on the Judicial Conference's model for district court
caseload of 430 filings per judgeship, CAVC's current caseload
justifies at least nine judges without even considering that
many of the appeals filed will be considered by a panel of
judges. Under the Conference's appellate formula of 500 filings
per three-judge panel, which equates to a potential requirement
for each judge to write a decision in 167 cases, seven full-
time judges responsible for over 4,000 appeals per year, or,
571 per judge, greatly exceeds the normal appellate caseload.
Thus, the recent trends demonstrate that the Court's workload
is large and increasing and supports authorizing more
judgeships.
In addition to looking at the Judicial Conference process,
the Committee believes that it is important to recognize that
CAVC also has a special responsibility as the only national
court that reviews veterans' benefits decisions. The impacts of
that mandate are significant and they must be studied and
weighed when considering the appropriate size of the Court.
Although the Judicial Conference does not consider future
projected caseloads when assessing the need for additional
judgeships, it does consider the specific nature of a
particular court in carrying out its evaluations. With respect
to CAVC, there are bellwethers as to the caseload growth trend
that cannot be ignored. The Nation is at war and there is no
doubt that the number of veterans who are likely to seek
benefits will rise as a result. There is great interest within
VA in expediting administrative adjudications of the hundreds
of thousands of claims that are filed with VA each year, and
Congress has increased substantially the resources for VA and
the Board of Veterans' Appeals (BVA or the Board) to accelerate
administrative determinations. The Board has established a goal
of deciding 43,000 cases or more each year, and VA has
testified to the growing complexity of the claims filed and the
rising number of issues contained within each claim. Because
every veteran has an absolute right to appeal an adverse
decision of the Board, there is significant pool of potential
cases that may reach the Court.
Unlike the Federal District Courts, CAVC does not have a
pool of hundreds of senior judges to draw from at will. In the
next eight years, it appears likely that only one judge will
join the ranks of the retired recall-eligible judges.
Conversely, it is certainly possible during that same period
that one or more of the six current retired judges may become
unavailable for recall service. The Committee believes that it
would be irresponsible not to consider these factors in any
assessment of the judgeship needs of CAVC.
In response to the increasing caseload, the Court has
examined its operational efficiency and taken steps to maximize
the use of its available resources. To this end, retired
recall-eligible judges have been convened to provide
substantial service to the Court, the Court's Central Legal
Staff has been trained in and has developed an enhanced
alternative dispute resolution program, and the Court's Rules
of Practice and Procedure have been amended to require pre-
briefing settlement conferences and to streamline the process
of preparing the appellate record. Additionally, the Court is
in the process of implementing an electronic case filing
system, and is considering summary disposition for some
appeals. While these steps help in managing the growing numbers
of appeals, they are not sufficient.
Committee Bill. The Committee bill would amend section
7253(a) so as to increase the number of active judges on CAVC
from seven to nine.
Sec. 402. Protection of privacy and security concerns in court records.
Section 402 of the Committee bill, which is derived from S.
2090, would protect privacy and security concerns in records of
CAVC.
Background. Current law, section 7268(a) of title 38,
United States Code, provides that ``all decisions of the Court
of Appeals for Veterans Claims and all briefs, motions,
documents, and exhibits received by the Court * * * shall be
public records open to the inspection of the public.'' Section
7268(b)(1) provides that ``[t]he Court may make any provision
which is necessary to prevent the disclosure of confidential
information, including a provision that any such document or
information be placed under seal to be opened only as directed
by the Court.''
The Court has developed a process to seal, on its own,
cases involving the conditions identified in section 7332(a)(1)
of title 38, relating to confidentiality of certain VA medical
records. Moreover, motions by appellants to seal case records
for good cause are routinely granted. Even where case records
remain unsealed, public access to those records presently is
limited to on-site review in the reading room of the Court's
Public Office. However, with the Court's implementation of the
e-filing of records, the present logistical limitation on
access to unsealed records will not exist.
E-filing potentially makes sensitive material in court
records widely accessible. These records generally include
appellants' Social Security information and medical records. As
other federal courts implement e-filing, they too are
attempting to achieve the balance between maintaining court
records public while providing parties with protection from
internet data mining and identity theft. The need to reach a
balance is urgent.
Committee Bill. The Committee bill would amend section 7268
of title 38, so as to require the Court to prescribe rules, in
accordance with section 7264(a) of title 38, to protect privacy
and security concerns relating to the filing of documents, and
the public availability of such documents, that are retained by
CAVC or filed electronically. The Committee bill would require
that the rules prescribed by the Court be consistent, to the
extent practicable, with rules that address privacy and
security issues throughout the Federal courts.
Sec. 403. Recall of retired judges of the United States Court of
Appeals for Veterans Claims.
Section 403 of the Committee bill would eliminate the
current restrictions on how many days per year a retired judge
of CAVC may voluntarily serve in recall status; would modify
the retirement pay structure for CAVC judges appointed on or
after the date of enactment; and would exempt retired judges
from involuntary recall once they have served an aggregate of
five years of recall service.
Background. Under current law, retiring CAVC judges make an
election whether to be recall-eligible. If a judge chooses to
be recall-eligible, the Chief Judge has the authority to
involuntarily recall that judge for up to 90 days per calendar
year or, with the consent of the judge, to recall the judge for
up to 180 days per calendar year. A recall-eligible retired
judge receives annual pay equal to the annual salary of an
active judge (pay-of-the-office) and that salary level is not
impacted by how much recall service is performed during a year.
Committee Bill. Section 403 of the Committee bill would
modify the authorities for the recall of retired judges and the
retirement pay structure. First, this section would repeal the
180-day limit on how many days per calendar year a recall-
eligible retired judge may voluntarily serve in recall status.
In addition, for judges appointed on or after the date of
enactment, it would create a three-tiered retirement pay
structure. Specifically, pay-of-the-office would be reserved
for judges who are actively serving, either as a judge of the
Court or as a retired judge serving in recall status. When not
serving in recall status, a recall-eligible retired judge would
receive the rate of pay applicable to that judge as of the date
the judge retired, as increased by periodic cost-of-living
adjustments. A retired judge who is not recall-eligible would
receive the rate of pay applicable to that judge at the time of
retirement. Finally, section 403 would exempt current and
future recall-eligible retired judges from involuntary recall
once they have served an aggregate of five years of recall
service.
By removing the cap on voluntary recall service and
exempting recall-eligible judges from involuntary recall once
they have served a cumulative total of five years of recall
service, the Committee intends to provide both the authority
and an incentive for recall-eligible judges to serve longer or
more frequent periods of recall service. By reserving pay-of-
the-office for those retired judges actually performing recall
service, there will be an incentive for retired judges to
continue offering their expertise in a time of need.
Sec. 404. Annual reports on workload of the United States Court of
Appeals for Veterans Claims.
Section 404 of the Committee bill would establish an annual
reporting requirement for CAVC. The Court would be required to
submit to the Committees on Veterans' Affairs of the Senate and
House of Representatives an annual report summarizing the
workload of the Court.
Background. The Court's workload has increased dramatically
in recent years. Between FY 1998 and FY 2004, approximately 200
cases were filed monthly with the Court. In FY 2005, that
number began to increase, reaching an average of 387 cases per
month in FY 2007. The FY 2007 total of 4,644 cases exceeded the
Court's previous single year high by approximately 900 cases.
This dramatic increase has raised concerns that CAVC may not
have the resources it needs to keep pace with its workload.
However, there is currently a dearth of specific information on
the unique characteristics of the Court's workload.
Committee Bill. Section 404 of the Committee bill would
require CAVC to report to Congress annually on various details
of its workload. The information required to be in the report
would include the number of appeals, petitions, and
applications for fees under the Equal Access to Justice Act
(EAJA) filed with the Court. It would also include the total
number of dispositions by the Court as a whole, by the Clerk of
the Court, by a single judge, by multi-judge panels, and by the
full Court and the number of each type of disposition by the
Court, including settlement, affirmation, remand, vacation,
dismissal, reversal, grant, and denial. In addition, the
required information would include the median time from filing
an appeal to disposition by the Court as a whole, by the Clerk
of the Court, by a single judge, or by multiple judges; the
median time from the filing of a petition to disposition by the
Court; the median time from filing an EAJA application to
disposition by the Court; and the median time from completion
of the briefing requirements by the parties to disposition by
the Court. The report would also include the number of oral
arguments held by the Court; the number of cases appealed to
the United States Court of Appeals for the Federal Circuit; the
number and status of appeals, petitions, and EAJA applications
pending at the end of the fiscal year; the number of cases
pending for more than 18 months at the end of the fiscal year;
and a summary of any service performed by recalled retired
judges during the fiscal year.
In the view of the Committee, this information would be
helpful in monitoring whether the Court has sufficient
resources to provide claimants with timely and appropriate
service.
TITLE V--INSURANCE MATTERS
Sec. 501. Report on inclusion of severe and acute Post Traumatic Stress
Disorder among conditions covered by traumatic injury
protection coverage under Servicemembers' Group Life Insurance.
Section 501 of the Committee bill, which is derived from S.
2965, would require VA, in consultation with the Department of
Defense, to submit a report to Congress assessing the
feasibility of and advisability of including severe and acute
Post Traumatic Stress Disorder (PTSD) among the conditions
covered by traumatic injury protection coverage under
Servicemembers' Group Life Insurance (SGLI).
Background. Section 1032 of Public Law 109-13, the
Emergency Supplemental Appropriations Act for Defense, the
Global War on Terror, and Tsunami Relief, 2005 established
traumatic injury protection coverage under the SGLI program.
Traumatic Servicemembers' Group Life Insurance (TSGLI) provides
coverage against qualifying losses incurred as a result of a
traumatic injury event. In the event of a loss, VA will pay
between $25,000 and $100,000 depending on the severity of the
qualifying loss. A key factor in analyzing the severity of a
particular traumatic injury is the impact it has on the length
of hospitalization and rehabilitation for the injured
servicemember.
At present, active duty and reserve component
servicemembers with any amount of SGLI coverage are
automatically covered under TSGLI. A premium (currently $1
monthly) is collected from covered members to meet peacetime
program expenses; DOD is required to fund TSGLI program costs
associated with the extra hazards of military service.
TSGLI was designed to provide severely injured
servicemembers who suffer a loss as a direct result of a
traumatic injury with short-term monetary assistance to lessen
the economic burden on them and their families, who often incur
financial hardships when they relocate to be with the member
during long and difficult treatment and rehabilitation periods.
Section 1980A(b)(1) of title 38, United States Code, lists some
qualifying losses for which injured servicemembers are covered
under TSGLI, including, among others, complete loss of vision,
complete loss of hearing, amputation of a hand or foot and the
inability to carry out the activities of daily living resulting
from injury to the brain. PTSD is not currently among the
conditions classified as qualifying losses. However, recent
research on the severity of the problem suggests the concept
should be studied.
In April 2008, the RAND Corporation released a study on
post-deployment PTSD, major depression and traumatic brain
injury entitled: ``Invisible Wounds of War.'' Based on the
results of a telephone survey of 1,965 previously deployed
individuals, the study estimated that approximately 300,000 of
the 1.64 million servicemembers who have returned from Iraq and
Afghanistan suffer from symptoms of PTSD or major depression.
These findings suggest a widespread problem, which, in its most
severe and acute manifestations, can have a significant impact
on readjustment and earning capacity. RAND estimated that the
cost of an invisible wound in terms of lost productivity,
treatment, and other impacts over the two-year period
immediately following deployment ranges from $5,904 to $25,757
per person. RAND noted that this estimate does not include
potential costs associated with homelessness, domestic
violence, family strain, and substance abuse.
Committee Bill. Section 501 of the Committee bill would
require VA, in consultation with DOD, to submit a report to
House and Senate Committees on Veterans' Affairs and Committees
on Armed Services assessing the feasibility and advisability of
including severe and acute PTSD among the conditions covered by
TSGLI. The report would be due to the Committees not later than
180 days after enactment of this bill.
The Committee bill would require VA to specifically
consider certain factors in preparation of the assessment: the
advisability of providing TSGLI coverage to individuals who
suffer from PTSD as a result of military service in a combat
zone which renders them unable to carry out the daily
activities of living; the unique circumstances of military
service in a combat zone; any financial strain incurred by
family members of those suffering from severe and acute PTSD;
the recovery time, and any particular difficulties of the
recovery process, associated with severe and acute PTSD; and
other matters as VA considers appropriate.
Sec. 502. Treatment of stillborn children as insurable dependents under
Servicemembers' Group Life Insurance.
Section 502 of the Committee bill, which is derived from S.
2946, would allow a stillborn child to be an insurable
dependent under SGLI.
Background. In 2001, section 4 of the ``Veterans' Survivor
Benefits Improvements Act of 2001'', Public Law 107-14,
established a program of family insurance coverage under SGLI
through which an SGLI-insured member's insurable dependents,
defined as the member's spouse and children, could also be
insured. A member's spouse may be insured in an amount up to
$100,000. Coverage of a member's children is automatic and is
in the amount of $10,000 for each child. Under current law,
stillborn children are not eligible for coverage as insurable
dependents under SGLI.
A lawsuit, Warnock v. Office of Servicemembers' Group Life
Insurance, No. 1:03-cv-1329-DFH, 2004 U.S. Dist. LEXIS 8533
(S.D. Ind. April 28, 2004), raised the issue as to whether a
member's stillborn child is covered as an insurable dependent
under SGLI. The plaintiff argued that the stillbirth of his
child at 38 weeks gestational age should be covered under SGLI.
The Court dismissed the lawsuit for failure to state a claim
upon which relief could be granted, ruling that applicable
statutes and the SGLI policy do not extend life insurance
coverage to stillborn infants. In its ruling, the Court noted
that ``Congress could write the statute, or an insurer could
write a policy, to cover future stillbirths.''
In 2005, the Senate passed S. 1235, the ``Veterans' Housing
Opportunity and Benefits Improvement Act of 2006.'' That
legislation included a provision, section 102, which would have
included stillborn children as insurable dependents under SGLI.
This provision was subsequently dropped in negotiations between
the House and the Senate.
Committee Bill. Section 502 of the Committee bill would
amend section 1965(10) of title 38, United States Code, so as
to cover a servicemembers ``stillborn child'' as an insurable
dependent under the SGLI program. The Committee does not expect
the term ``stillborn child'' to cover the deaths of children at
any gestational age or under every circumstance. Rather, the
Committee expects VA to issue regulations that would define the
term in a manner consistent with the 1992 recommended reporting
requirements of the Model State Vital Statistics Act and
Regulations as drafted by the Centers for Disease Control and
Prevention's National Center for Health Statistics. The Model
Act recommends a state reporting requirement of fetal deaths
involving fetuses weighing 350 grams or more, if the weight is
unknown, or 20 or more completed weeks of gestation, calculated
from the date last normal menstrual began to the date of
delivery.
Sec. 503. Other enhancements of Servicemembers' Group Life Insurance
coverage.
Section 503 of the Committee bill, which is derived from S.
2984, makes changes to and clarifies the SGLI and Veterans'
Group Life Insurance programs.
Background. SGLI is a VA-supervised life insurance program
that provides group coverage for members on active duty in the
uniformed services (Army, Navy, Air Force, Marine Corps, and
Coast Guard), members of the Commissioned Corps of the United
States Public Health Service and the National Oceanic and
Atmospheric Administration, Reserve and National Guard members,
Reserve Officer Training Corps members engaged in authorized
training, service academy cadets and midshipmen, Ready Reserve
and Retired Reserve members, and Individual Ready Reserve
members who are subject to involuntary recall to active duty
service. VA purchases a group policy on behalf of participating
members from a commercial provider. Since the inception of the
SGLI program in 1965, The Prudential Insurance Company of
America has been the provider. VA's FY 2009 budget submission
projects that 2,342,000 individuals will be covered under SGLI
in FY 2009.
Full coverage under SGLI is provided automatically at the
maximum coverage amount when an individual begins covered
service. Partial coverage at prorated premium rates is
available for Reserve and National Guard members for active and
inactive duty training periods. To be covered in an amount less
than the maximum, or to decline coverage altogether, a member
must make a written election to that effect. Coverage amounts
may be reduced in multiples of $10,000. A member may also name,
at any time, one or more beneficiaries of his or her choice.
Decisions concerning coverage amounts and designation of
beneficiaries are made at the sole discretion of members
insured under SGLI.
The ``Veterans' Insurance Act of 1974'', Public Law 93-289,
established a new program of post-separation insurance known as
Veterans Group Life Insurance (VGLI). Like SGLI, VGLI is
supervised by VA but administered by Prudential. VGLI provides
for the post-service conversion of SGLI to a renewable term
policy of insurance. Persons eligible for full-time coverage
include former servicemembers who were insured full-time under
SGLI and who were released from active duty or the Reserves,
Ready Reservists who have part-time SGLI coverage and who incur
certain disabilities during periods of active or inactive duty
training, and members of the Individual Ready Reserve and
Inactive National Guard. Like SGLI, VGLI is issued in multiples
of $10,000 up to the maximum coverage amount, but in no case
can VGLI coverage exceed the amount of SGLI coverage a member
had in force at the time of separation from active duty service
or the Reserves.
Committee Bill. Section 503 of the Committee bill would
correct the disparity in eligibility for SGLI coverage for
Ready Reservists and members the Individual Ready Reserve;
correct an inequity in termination dates of SGLI coverage
between dependents and separating servicemembers; clarify VA's
authority to set SGLI premiums for spouses of Ready Reservists
to make it consistent with current VA practice; and make
consistent VA's forfeiture provisions.
Subsection 503(a) would extend full-time and family SGLI
coverage to Individual Ready Reservists (IRRs), those
individuals referred to in section 1965(5)(C) of title 38,
United States Code. This group of individuals volunteer for
assignment to a mobilization category in the Individual Ready
Reserve, as defined in section 12304(i)(1) of title 10. The
``Veterans' Survivor Benefits Improvement Act of 2001,'' Public
Law 107-14, provided SGLI coverage for Ready Reservists,
referred to in section 1965(5)(B), but not to IRRs. The
Committee believes IRRs should be afforded comparable coverage
given that many of them have been called up to serve in
Operation Enduring Freedom and Operation Iraqi Freedom.
Subsection 503(b) would provide that a dependent's SGLI
coverage would terminate 120 days after the date of the
member's separation or release from service, rather than 120
days after the member's SGLI terminates. Under current law,
section 1968(a)(1)(A) of title 38, provides for a 120-day
period after separation from active duty service or the
Reserves for a member to receive premium-free SGLI coverage and
elect to convert the coverage to VGLI. However, under section
1968(a)(5)(B)(ii) a dependent retains coverage for 120 days
after that, for a total of 240 days after the member's
separation from service, twice the period of coverage for most
policyholders. This provision would correct the inequity
between members and dependents.
Subsection 503(c) would clarify that VA has the authority
to set premiums for SGLI coverage for the spouses of Ready
Reservists based on the spouse's age. This provision would
correct an inconsistency between section 1969(g)(1)(A) of title
38, which does not require identical premiums for coverage of
active duty members' spouses, and section 1969(g)(1)(B), which
may be read to imply that identical premiums for coverage of
Ready Reservists' spouses are required.
Subsection 503(d) would clarify that any person guilty of
mutiny, treason, spying, or desertion, or who, because of
conscientious objections, refuses to perform service in the
Armed Forces or refuses to wear the uniform of the Armed
Forces, forfeits all rights to VGLI. Under section 1973 of
title 38, forfeiture of SGLI is required, but not VGLI. The
inconsistency between these two insurance programs was
highlighted when it was discovered that former Federal Bureau
of Investigation Agent Robert Hannsen, who was charged, and
later plead guilty, to committing espionage by providing highly
classified national security information to Russia and the
former Soviet Union, was a VGLI policyholder. Under section
503(d) of the Committee bill, Hannsen's VGLI would remain in
force and be payable upon his death, however offenses occurring
after passage of this provision would result in forfeiture.
TITLE VI--OTHER MATTERS
Sec. 601. Authority for suspension or termination of claims of the
United States against individuals who died while serving on
active duty in the Armed Forces.
Section 601 of the Committee bill, which is derived from S.
2550, would authorize VA to suspend or terminate the collection
of debts owed to it by individuals who die while serving on
active duty in the Armed Forces.
Background. In January 2008, VA disclosed that, in an
attempt to collect debts owed to VA, the Department had
contacted the estates of twenty-two servicemembers who died
while serving in either Operation Enduring Freedom or Operation
Iraqi Freedom. Under the relevant law in effect at that time,
section 5302 of title 38, any veteran or active duty
servicemember indebted to VA due to the overpayment or
erroneous payment of benefits was able to apply for a waiver
from VA so as to remove the obligation to pay the debt.
However, under that law, VA was required to notify the
beneficiary, or his or her estate if the beneficiary was
deceased, when an outstanding debt arose and to provide
information on the right to apply for a waiver. This left VA in
the position of having to compound the grief of bereaved
families by burdening them with a debt waiver process, despite
the fact that the circumstances would likely warrant a waiver.
In an attempt to address this situation, S. 2550 was
introduced and testimony was taken on the bill at the
Committee's May 7, 2008, legislative hearing. Subsequent to
that hearing but before the Committee met to act on pending
legislation, a provision derived from that bill was reported by
the Senate Appropriations Committee and included in the
Supplemental Appropriations Act, 2008, Public Law 110-252.
The provision in the appropriations measure added a new
section 5302A to title 38, which prohibits VA from collecting
all or any part of a debt owed to VA by a servicemember or
veteran who dies as the result of an injury incurred or
aggravated in the line of duty while serving in a theater of
combat operations in a war or in combat against a hostile force
during a period of hostilities after September 11, 2001. The
Secretary is required to determine that termination of
collection is in the best interest of the United States
This new provision provides relief only to the families of
certain indebted servicemembers who die while serving on active
duty. By its terms, new section 5302A only exempts the estates
of individuals who die as the result of an injury incurred or
aggravated in the line of duty while serving in a theater of
combat operations in a war or in combat against a hostile force
during a period of hostilities from the burden of filing an
application for waiver of the debt.
The Committee believes this new provision is too narrowly
constructed to provide adequate relief to all individuals and
families who should be protected from unnecessary efforts by VA
to collect a debt. Because it is limited solely to indebted
individuals who die as the result of injuries incurred while
serving in combat with a hostile force, it does not include
individuals who die in training exercises or while otherwise
preparing to serve in a combat zone. This new provision gives
VA no discretion to consider exceptional cases that fall
outside of its limited parameters. In certain cases, waiver of
VA debts before notification of the estate may be in the best
interest of VA but the new provision does not accord the
Department the legal authority to avoid the notification and
waiver application process.
Committee Bill. Section 601 of the Committee bill would
amend section 3711 of title 31, United States Code, so as to
grant VA discretionary authority to suspend or terminate the
collection of debts owed to it by individuals who die while
serving on active duty in the Armed Forces. The authority to
suspend collection would cover all individuals who die while
serving on active duty as a member of the Army, Navy, Air
Force, Marine Corps, or Coast Guard during a period when the
Coast Guard is operating as a service in the Navy.
Section 3711 of title 31 provides overall guidance with
respect to requirements for collection and compromise by each
executive, judicial or legislative agency of claims owed to the
United States Government. Public Law 104-106, the National
Defense Authorization Act for Fiscal Year 1996, amended section
3711 so as to exempt the Secretary of Defense from that
section's requirements relating to the initiation and pursuit
of collection action with respect to the estates of indebted
servicemembers who die while serving on active duty. Public Law
104-201, the National Defense Authorization Act for Fiscal Year
1997, granted the same authority to the Secretary of
Transportation--now the Secretary of Homeland Security--with
respect to individuals who die while serving on active duty as
a member of the Coast Guard. The Committee bill would put VA on
equal footing with these two Departments, allowing VA to
forgive debts owed to the Department by individuals who die
while serving on active duty when the Secretary determines it
is appropriate under the circumstances.
The Committee bill also includes a freestanding provision
that would permit VA to provide an equitable refund to any
estate from which it collected a debt that it otherwise would
have waived had this provision been in effect at the time. VA
would have the discretion to determine in which cases, if any,
the use of this authority would be appropriate.
Sec. 602. Memorial headstones and markers for deceased remarried
surviving spouses of veterans.
Section 602 of the Committee bill, which is derived from S.
2984, would eliminate the disparity that exists between
eligibility for burial and eligibility for a memorial headstone
or marker for deceased remarried surviving spouses of veterans
whose remains are unavailable.
Background. Section 2306(b)(4)(B) of title 38, United
States Code, authorizes VA to furnish an appropriate memorial
headstone or marker to commemorate eligible individuals whose
remains are unavailable. Individuals currently eligible for
memorial headstones or markers include a veteran's surviving
spouse, which is defined to include ``an unremarried surviving
spouse whose subsequent remarriage was terminated by death or
divorce.'' Thus, a surviving spouse who remarried after the
veteran's death is not eligible for a memorial headstone or
marker unless the remarriage was terminated by death or divorce
before the surviving spouse died. However, a surviving spouse
who remarried after the veteran's death is eligible for burial
in a VA national cemetery without regard to whether any
subsequent remarriage ended.
Committee Bill. Section 602 of the Committee bill would
eliminate the disparity between eligibility for burial and
eligibility for a memorial headstone or marker. It would extend
eligibility for memorial headstones or markers to a deceased
veteran's remarried surviving spouse, without regard to whether
any subsequent remarriage ended.
Sec. 603. Three-year extension of authority to carry out income
verification.
Section 603 of the Committee bill would extend for three
years, until September 30, 2011, VA's authority to obtain
information from the Internal Revenue Service (IRS) or the
Social Security Administration (SSA) for income verification
purposes for needs-based benefits.
Background. Under current law, certain benefits programs
administered by VA, including pensions for wartime veterans and
compensation for Individual Unemployability are available only
to beneficiaries whose annual income is below a certain level.
VA must have access to verifiable income information in order
to ensure that those receiving benefits under its income-based
programs are not earning a greater annual income than the law
permits.
Section 6103(l)(7)(D)(viii) of title 26, United States
Code, authorizes the release of certain income information by
the IRS or the SSA to VA for the purposes of verifying the
incomes of applicants for VA needs-based benefits. Section
5317(g) of title 38, United States Code, provides VA with
temporary authority to obtain and use this information. Under
current law, this authority expires on September 30, 2008.
Committee Bill. Section 603 of the Committee bill would
amend subsection 5317(g) of title 38 to extend VA's authority
to obtain income information from the IRS or the SSA until
September 30, 2011.
Sec. 604. Three-year extension of temporary authority for the
performance of medical disability examinations by contract
physicians.
Section 604 of the Committee bill, which is derived from S.
2984, would extend VA's temporary authority to contract for
medical disability examinations using appropriated funds for
three years, until December 31, 2012.
Background. In order to determine the type and severity of
disabilities of veterans filing for VA compensation or pension
benefits, VA often requires thorough medical disability
examinations. Because these examinations form the basis of
disability ratings, their accurate and timely completion is
essential. In recent years, the demand for medical disability
examinations has increased beyond the number of requests that
the current in-house system was designed to accommodate. This
rise in demand is due to an increase in the complexity of
disability claims, an increase in the number of disabilities
claimed by veterans, and changes in eligibility requirements
for disability benefits.
In 1996, in Public Law 104-275, the Veterans' Benefits
Improvements Act of 1996, VA was authorized to carry out a
pilot program of contract disability examinations through ten
VA regional offices using amounts available for payment of
compensation and pensions. During the initial pilot program,
one contractor--QTC Management, Inc.--performed all contract
examinations at the ten selected regional offices. The pilot
was deemed a success, with general satisfaction reported from
all stakeholders. According to the VA Claims Processing Task
Force's 2001 report to the Secretary of Veterans Affairs,
``[t]he quality of QTC Management examinations has been
reported to exceed a 99 percent adequacy rate, and the Task
Force found high approval from Regional Office employees.
Reported medical examination timeliness was within contract
compliance with positive feedback in customer service
surveys.''
In 2003, in Public Law 108-183, the Veterans Benefits Act
of 2003, VA was temporarily authorized to contract for
disability examinations using appropriated funds. This
authority expires on December 31, 2009. High demand for
compensation and pension examinations continues and VA reports
continued satisfaction with the contracted exams, so the
Committee views extension of the program to be warranted.
Committee Bill. Section 604 of the Committee bill would
extend VA's authority, through December 31, 2012, to use
appropriated funds for the purpose of contracting with non-VA
providers to conduct disability examinations. The examinations
would be conducted pursuant to contracts entered into and
administered by the Under Secretary for Benefits. The Committee
notes that the authority to contract for disability
examinations through the regional offices, using amounts
available for payment of compensation and pension, is an
ongoing authority with no time limitation.
Committee Bill Cost Estimate
In compliance with paragraph 11(a) of rule XXVI of the
Standing Rules of the Senate, the Committee, based on
information supplied by the CBO, estimates that enactment of
the Committee bill would, relative to current law, increase
discretionary spending by $9 million in 2009 and by $169
million over the 2009-2013 period, assuming appropriation of
the necessary amounts. The Committee bill would decrease direct
spending by $7 million in 2009, and by $29 million over the
2009-2013. According to CBO, S. 3023 would impose an
intergovernmental mandate as defined in the Unfunded Mandates
Reform Act (UMRA) by placing new requirements on state
governments, including public institutions of higher education
that operate as lenders of student loans. CBO estimates that
the aggregate costs of the mandate would be well below the
threshold established in UMRA.
The cost estimate provided by CBO, setting forth a detailed
breakdown of costs, follows:
Congressional Budget Office
Washington, DC, July 23, 2008.
Hon. Daniel K. Akaka
Chairman,
Committee on Veterans' Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 3023, the Veterans'
Benefits Improvement Act of 2008.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Dwayne M.
Wright.
Sincerely,
Peter R. Orszag,
Director.
Enclosure
S. 3023--Veterans' Benefits Improvement Act of 2008
Summary: S. 3023 would affect several veterans' programs,
including housing, pension, burial, life insurance, and
readjustment benefits. CBO estimates that implementing this
legislation would incur discretionary costs of $9 million in
2009 and $169 million over the 2009-2013 period, assuming
appropriation of the necessary amounts.
The bill also contains provisions that would both increase
and decrease direct spending for veterans benefits. On balance,
CBO estimates that enacting S. 3023 would decrease direct
spending by $7 million in 2009, $29 million over the 2009-2013
period, and $18 million over the 2009-2018 period. Enacting the
bill would have no effect on federal revenues.
S. 3023 would impose an intergovernmental mandate as
defined in the Unfunded Mandates Reform Act (UMRA) by placing
new requirements on state governments, including public
institutions of higher education that operate as lenders of
student loans. CBO estimates that the aggregate costs of the
mandate would be well below the threshold established in UMRA
($68 million in 2008, adjusted annually for inflation).
Public institutions of higher education also would incur
costs to implement a provision in the bill that would require
those institutions, as participants in federal student loan
programs, to refund tuition and fees to servicemembers if they
must leave school because of military service commitments.
However, those costs, estimated to total at least $40 million
in 2008, would result from conditions of a voluntary federal
program, not intergovernmental mandates.
Section 311 of S. 3023 contains private-sector mandates as
defined in UMRA. CBO estimates that the annual cost of those
mandates would not exceed the threshold established in UMRA
($136 million for private-sector mandates in 2008, adjusted
annually for inflation).
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 3023 is summarized in Table 1. The costs
of this legislation fall mostly within budget function 700
(veterans benefits and services).
Table 1.--Estimated Budgetary Impact of S. 3023, Veterans' Benefits Improvement Act of 2008
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
------------------------------------------------------------
2009 2010 2011 2012 2013 2009-2013
----------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Authorization Level...................... 9 39 51 53 17 169
Estimated Outlays.................................. 9 39 51 53 17 169
CHANGES IN DIRECT SPENDINGa
Estimated Budget Authority......................... -7 -10 -13 1 -1 -29
Estimated Outlays.................................. -7 -10 -13 1 -1 -29
----------------------------------------------------------------------------------------------------------------
Note: Components may not sum to totals because of rounding.
aIn addition to the direct spending effects shown here, enacting S. 3023 would affect direct spending after 2013
(see Table 3). The estimated net reduction in direct spending sums to $18 million over the 2009-2018 period.
Basis of estimate: For this estimate, CBO assumes the
legislation will be enacted near the beginning of fiscal year
2009, that the estimated authorization amounts will be
appropriated near the start of each fiscal year, and that
outlays will follow historical spending patterns for existing
or similar programs.
Spending subject to appropriation
S. 3023 contains several provisions that would increase
spending subject to appropriation. CBO estimates that
implementing the bill would result in discretionary outlays of
$9 million in 2009 and $169 million over the 2009-2013 period,
subject to appropriation of the necessary amounts (see Table
2).
Table 2.--Estimated Changes to Discretionary Spending Under S. 3023, Veterans' Benefits Improvement Act of 2008
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
------------------------------------------------------------
2009 2010 2011 2012 2013 2009-2013
----------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Extension of Authority for Medical Exams by
Contract Physicians
Estimated Authorization Level.................. 0 35 47 49 13 144
Estimated Outlays.............................. 0 35 47 49 13 144
Human Resources Training
Estimated Authorization Level.................. 5 2 2 2 2 13
Estimated Outlays.............................. 5 2 2 2 2 13
Active Judges on the Court of Appeals for Veterans
Claims
Estimated Authorization Level.................. 2 2 2 2 2 10
Estimated Outlays.............................. 2 2 2 2 2 10
Reports
Estimated Authorization Level.................. 2 * * * * 2
Estimated Outlays.............................. 2 * * * * 2
------------------------------------------------------------
Total Changes
Estimated Authorization Level.............. 9 39 51 53 17 169
Estimated Outlays.......................... 9 39 51 53 17 169
----------------------------------------------------------------------------------------------------------------
Note: * = less than $500,000.
Extension of Authority for Medical Exams by Contract
Physicians. Section 604 would extend the temporary authority
for the performance of medical examinations by contract
physicians through December 31, 2012. Under current law, that
authority expires on December 31, 2009. Although that authority
has been in existence for several years, the Department of
Veterans Affairs (VA) first used it in 2008. Based on
information from VA, CBO estimates that, in 2009, VA will use
the current authority to have about 37,000 exams completed by
contract physicians at a cost of about $900 per exam. CBO
further estimates that if the authority is extended beyond
2009, VA would use contract physicians for about 47,000 exams a
year. Taking inflation into account, CBO estimates that
implementing section 604 would cost $144 million over the 2010-
2013 period.
Human Resources Training. Section 304 would require every
federal agency to provide training to human resources personnel
on the employment and reemployment rights under the Uniformed
Services Employment and Reemployment Rights Act (USERRA) of
federal employees who leave their positions to undertake
military service. The training would be developed and provided
in consultation with the Office of Personnel Management (OPM).
Using information provided by OPM and the Department of Labor
(DOL), CBO estimates that there are over 20,000 human resources
professionals in the federal government. USERRA training,
although currently available, is not required. CBO expects that
most of the training would be Internet-based, with some
individual conferences in large agencies or cities. Based on
those assumptions and using information provided by OPM, DOL,
and various human resource professionals, CBO estimates that
implementing mandatory training for federal employees would
cost $5 million in 2009 and $2 million annually in subsequent
years.
Active Judges on the Court of Appeals for Veterans Claims
(CAVC). Section 401 would increase the number of active judges
on the CAVC from seven to nine. According to the CAVC, in 2007,
the average annual cost for a judge's chamber--which includes
salaries of the judges and their staff, infrastructure, and
incidentals--was about $1 million. Therefore, CBO estimates
that implementing section 401 would cost $10 million over the
2009-2013 period.
Reports. S. 3023 would require VA to complete a series of
reports and studies for the Congress on varying topics and
issues. Those issues include: VA's progress in addressing
geographic variance in veterans' disability payments; the
appropriate levels of disability compensation for service-
connected disabilities and of long-term transition payments for
veterans undergoing vocational rehabilitation; the effect of
mortgage foreclosures on veterans; the employment needs of
Native American veterans living on tribal lands; ways to assist
and encourage veterans to complete vocational rehabilitation;
and the feasibility of including acute and severe Post
Traumatic Stress Disorder under the traumatic injury protection
insurance covered by Servicemembers Group Life Insurance (SGLI)
program. Based on information from VA, CBO estimates that
completing those reports would cost about $2 million over the
2009-2013 period.
Direct Spending
S. 3023 contains provisions that would both increase and
decrease direct spending. CBO estimates that, on net, enacting
S. 3023 would decrease direct spending by $7 million in 2009,
by $29 million over the 2009-2013 period, and by $18 million
over the 2009-2018 period (see Table 3).
Table 3.--Estimated Changes to Direct Spending Under S. 3023, Veterans' Benefits Improvement Act of 2008
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, outlays in millions of dollarsa--
-------------------------------------------------------------------------------------------
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2009-2013 2009-2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDINGb
Extension of Income Verification............................ -2 -4 -6 -5 -6 -6 -5 -5 -5 -5 -24 -50
Guarantees of Mortgage Refinancing Loans.................... * * * 3 3 3 3 5 4 5 6 26
Guarantees of Adjustable-Rate Mortgages..................... -4 -4 -4 -1 0 0 0 1 0 1 -13 -11
Temporary Increase in the Maximum Loan Guarantee............ -1 -3 -4 2 0 1 0 1 0 1 -6 -3
Educational Assistance for Spouses of Severely Disabled 0 1 1 2 2 2 2 1 1 1 6 13
Veterans...................................................
Certification Requirement for Self-Employment On-the-Job * * * * * 1 1 1 1 1 2 7
Training...................................................
-------------------------------------------------------------------------------------------
Total Changes........................................... -7 -10 13 1 -1 1 1 4 1 4 -29 -18
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: * = less than $500,000.
aAnnual changes in budget authority would be equal to the estimated changes in outlays.
bComponents may not sum to totals because of rounding.
Extension of Income Verification. Section 603 would extend
authorities in current law that allow VA to acquire information
on income reported to the Internal Revenue Service (IRS) to
verify income reported by recipients of VA pension benefits.
The authorization allowing the IRS to provide income
information to VA was made permanent by Public Law 110-245, but
the authorization allowing VA to acquire the information is
scheduled to expire on September 30, 2008. Section 603 would
extend VA's authority to acquire IRS data through September 30,
2011. According to VA, the department saved, on average,
approximately $5 million each year in new pension benefit
payments by verifying veterans' incomes over the 2001-2007
period using the IRS data.
In 2007, the President signed into law Public Law 110-157,
which includes a provision allowing VA to use the National
Directory of New Hires (NDNH) database as an alternate source
of income-verification data. That authority is set to expire on
September 30, 2011. The NDNH database, though using more up-to-
date information, does not include a large segment of the
workforce that might self-report work income. The IRS data
reflect information on self-reported income.
If VA were to use both systems over the three-year period
from 2009 through 2011, CBO estimates that the incremental
savings from utilizing the IRS data for income verification
would be about $2 million in new savings each year. Those
savings would compound in subsequent years (rising to about $4
million in year two, and so on), with cost-of-living and
mortality adjustments, until 2011 when savings would decline
after the authority to use IRS data expires. CBO estimates that
section 603 would reduce direct spending by $50 million over
the 2009-2018 period.
Guarantees of Mortgage Refinancing Loans. Section 202 would
authorize VA to provide the same maximum loan guarantee for
veterans refinancing a non-VA loan as is provided for loans
that are guaranteed by VA. Under current law, VA can provide a
guarantee of only $36,000 for refinancing non-VA loans compared
with a guarantee of $104,250 for refinancing VA loans. The
section also would decrease the equity requirement for such
refinancing loans from 10 percent of the loan amount to 5
percent.
Based on information from VA, CBO estimates that those
changes would result in an additional 1,000 loans in 2009,
increasing to an additional 2,000 loans a year in 2012 and
subsequent years. CBO and VA estimate that the VA loan
guarantees currently have a negative subsidy rate reflecting
relatively low default rates and the collection of up-front
fees. However, certain loan fees will be reduced (under current
law) on October 11, 2011, resulting in a positive subsidy rate
after that date. Because most of the additional loans would
occur after the loan fees are reduced, the additional loans
would increase direct spending by $26 million over the 2009-
2018 period, CBO estimates.
Guarantees of Adjustable-Rate Mortgages. Section 203 would
extend, through 2012, VA's authority to guarantee adjustable-
rate mortgages and hybrid adjustable rate-mortgages.
Adjustable-rate mortgages have interest rates that may change
annually. Hybrid adjustable-rate mortgages have a fixed
interest rate for an initial period of a few years, after which
the rate may be adjusted annually. The authority to provide
guarantees for such loans expires at the end of fiscal year
2008.
Based on data from VA, CBO estimates that extending that
authority would result in an additional 1,400 loans a year.
Because the VA loan guarantee program has a negative subsidy
rate during the period covered by the authority in section 203,
those additional loans would increase receipts by $13 million
over the 2009-2012 period. CBO expects that some of those
additional loans would become delinquent and go to foreclosure.
When a guaranteed loan goes into foreclosure, VA often acquires
the property and issues a new direct loan (called a vendee
loan) when the property is sold. VA sells most vendee loans on
the secondary-mortgage market and guarantees their timely
repayment. Those vendee loans carry a positive subsidy,
reflecting their potential defaults. Thus, the increased
receipts for the new VA guarantees of adjustable-rate mortgages
would be slightly offset by an additional $2 million in subsidy
costs related to vendee loans. In total, extending the
authority to guarantee adjustable-rate mortgages would reduce
direct spending by $11 million over the 2008-2018 period.
Temporary Increase in the Maximum Loan Guarantee. VA can
provide lenders a guarantee of up to 25 percent of the value of
home-acquisition loans made to veterans. Under current law, the
maximum loan amount for which VA can provide a 25 percent
guarantee is the Freddie Mac conforming loan limit of $417,000.
Section 201 would increase the maximum amount of the loan for
which a veteran could receive a 25 percent loan guarantee to
125 percent of the area median home price, not to exceed 175
percent of the current Freddie Mac limit, or $729,750. The
authority to increase the guarantee would expire on December
31, 2011.
Based on nationwide mortgage data and information from the
VA, CBO estimates that a total of 4,700 additional guaranteed
loans would be made for an average loan amount of 10 percent
more than the amount of the current maximum guarantee. CBO and
VA estimate that the VA loan guarantees currently have a
negative subsidy rate of about 0.4 percent. Because of that
negative subsidy rate, CBO estimates that the added loans and
higher loan amounts would increase receipts by $8 million
during fiscal years 2009 through 2011. However, certain loan
fees will be reduced on October 1, 2011, resulting in higher
subsidy rates. The additional loan guarantees that CBO
estimates would occur in the final quarter before the authority
expires would thus increase subsidy outlays by $2 million.
CBO expects that some of those additional loans would
become delinquent and go to foreclosure. As noted above, when a
guaranteed loan goes into foreclosure, VA often acquires the
property and issues a vendee loan when the property is sold.
CBO estimates that the subsidy cost for those vendee loans in
subsequent years would total $3 million over the 2014-2018
period.
Taking into account the initial savings estimated for new
loan guarantees and the expected costs for vendee loans, CBO
estimates that this provision would reduce direct spending by
$6 million over the 2009-2013 period and by $3 million over the
2009-2018 period.
Educational Assistance for Spouses of Severely Disabled
Veterans. Section 312 would allow spouses of veterans who are
permanently and totally disabled to use education assistance
over a 20-year period. Under current law, eligible spouses have
a 10-year window in which to use their benefits.
CBO estimates that nearly 6,000 spouses would be eligible
for the extended entitlement period during some or all of the
next 10 years. The Department of Defense reports that more than
9,000 veterans have separated from the armed forces with a
permanent, total disability over the last 20 years. Of those
9,000 veterans, about 65 percent have spouses or children. CBO
anticipates that more than 2,000 spouses will be eligible for
the benefit each year and that 10 percent would use the benefit
annually. CBO expects that the approximately 200 users each
year would receive an average benefit that would equal $5,200
in 2009 and would grow by an annual cost-of-living increase
thereafter. Therefore, CBO estimates that, over the 2009-2018
period, enacting section 312 would increase direct spending by
$13 million.
Certification Requirement for Self-Employment On-the-Job
Training. Under section 316, veterans participating in on-the-
job training for self-employment or operation of a franchise
would no longer be required to provide VA certification that
they are being paid for the training and that the training will
lead to employment. Because self-employment and franchise
training are typically unpaid, veterans pursuing those goals
who are otherwise eligible to receive payments for training are
effectively excluded due to the existing requirement that they
certify that they are being paid for the training.
CBO estimates that most of the veterans receiving on-the-
job training benefits under section 316 would be franchise
owners. The International Franchise Association runs a well-
publicized program that enables veterans to purchase franchises
at discounted rates. Based on information from the association
and other national franchise information, CBO estimates that
under section 316 about 400 veterans annually would purchase
franchises and qualify for on-the-job training benefits during
their training period. For a typical training period of five
weeks, veterans would receive around $1,600. In total, CBO
estimates that enacting section 316 would increase direct
spending by $7 million over the 2009-2018 period.
Automatic Cost-of-Living Adjustment (COLA). Section 103
would provide a permanent annual cost-of-living adjustment to
the amounts paid to veterans for disability compensation and to
their survivors for dependency and indemnity compensation. The
COLA would equal the cost-of-living adjustment payable to
Social Security recipients. The increase would take effect on
December 1 of each year, and the results of the adjustment
would be rounded to the next lower dollar.
The COLA that would be authorized by this bill is assumed
in CBO's baseline, pursuant to section 257 of the Balanced
Budget and Emergency Deficit Control Act, and savings from
rounding it down were achieved by the Balanced Budget Act of
1997 (Public Law 105-33) and extended to 2013 by the Veterans
Benefits Act of 2003 (Public Law 108-183). Because the COLA is
assumed in CBO's baseline, this provision would have no
budgetary effect relative to that baseline. CBO estimates that
the COLA for 2010, which would take effect in the second
quarter of fiscal year 2010, would equal $1.2 billion. The
full-year cost of that increase would equal $1.6 billion.
Similar increases are estimated in subsequent years.
Other provisions. The following provisions would have an
insignificant impact on federal direct spending:
Section 204 would allow severely disabled members
of the armed forces to receive certain housing grants from VA
before they leave the service. CBO expects this provision would
affect very few individuals and, in most cases, would serve
only to accelerate the benefit by several months.
Section 301 would extend the 24-month limitation
on receiving Independent Living assistance for severely
disabled veterans of the war on terrorism. The Independent
Living program provides services to maximize independence in
daily living for veterans who are too severely disabled to
pursue employment. Based on current program usage rates from
VA, CBO estimates that fewer than 20 veterans will use more
than 24 months of Independent Living services.
Section 602 would grant eligibility for VA-
provided memorial headstones to certain deceased surviving
spouses of veterans. Based on information from VA, CBO expects
that there would be very few requests for VA-memorial
headstones from the survivors of those surviving spouses.
Estimated Impact on State, Local, and Tribal Governments
Intergovernmental Mandates. Currently, fewer than 20 public
institutions of higher education make or originate Federal
Stafford Loans to graduate students under the Federal Family
Education Loan program. S. 3023 would prohibit those
institutions from applying an annual interest rate higher than
6 percent on student loans made to servicemembers during their
period of military service. The duty to comply with the
interest rate cap would be an intergovernmental mandate as
defined in UMRA. Because Graduate Stafford Loans (both
subsidized and unsubsidized) currently have a fixed interest
rate of 6.8 percent through 2013 and because the provision
would apply to a small number of individuals attending fewer
than 20 public institutions of higher education, CBO estimates
that the mandate costs to governmental entities, in the form of
lost interest revenue due to the cap, would be small and would
not exceed the threshold in UMRA ($68 million in 2008, adjusted
annually for inflation).
Other Impacts. Public institutions of higher education that
participate in federal financial aid programs also would be
required to extend educational benefits to servicemembers
because of their military service. However, those requirements
would not be intergovernmental mandates as defined in UMRA, but
rather conditions of participating in a voluntary federal
program.
Public institutions of higher education would be required
to refund tuition and fees paid by servicemembers who had to
leave school because of military service commitments. In
addition, those institutions would be required to provide
servicemembers who discontinued an educational program because
of military service an opportunity to reenroll with the same
educational and academic status held prior to their military
service. Information from state and higher education officials
indicate that public institutions of higher education in
approximately half the states already extend similar benefits
to servicemembers either because of state law or institutional
policies. Public institutions that do not extend these benefits
would be required to do so because of their participation in
federal financial aid programs. CBO estimates that those
institutions would incur costs of at least $40 million in 2008.
Costs could be higher because enrollment data for all
servicemembers attending public institutions of higher
education, including active-duty members, were not available
for this analysis. The CBO estimate includes only costs
associated with members in the reserves who might discontinue
their education because of military service.
Estimated Impact on the Private Sector
The bill contains private-sector mandates as defined in
UMRA. Section 311 would require institutions of higher
education to refund tuition and fees paid by students called to
military service, for the portion of the education program for
which such servicemembers did not receive academic credit.
Section 311 also would limit the interest rate on student loans
to 6 percent per year for servicemembers during their period of
military service.
CBO expects that the number of servicemembers called to
military service while enrolled at an institution of higher
education would be small. Based on estimates of total student
loan debt for servicemembers entering the military, CBO also
expects that the annual costs to lenders resulting from a
reduction in the maximum allowable interest rate for those
loans also would be small. Thus, CBO estimates that the total
cost of the mandates would be below the annual threshold
established in UMRA ($136 million for private-sector mandates
in 2008, adjusted annually for inflation).
Previous CBO estimates: On July 17, 2008, CBO transmitted a
cost estimate for S. 2617, the Veterans' Compensation Cost-of-
Living Adjustment Act of 2008, as ordered reported by the
Senate Committee on Veterans' Affairs on June 26, 2008. On May
12, 2008, CBO transmitted a cost estimate for H.R. 5826, also
titled the Veterans' Compensation Cost-of-Living Adjustment Act
of 2008, as ordered reported by the House Committee on
Veterans' Affairs on April 30, 2008. Section 103 of S. 3023 is
similar to both S. 2617 and H.R. 5826. However, section 103
would automatically increase benefit levels for disability
compensation and dependency and indemnity compensation each
year by the same COLA that Social Security recipients would
receive. S. 2617 and H.R. 5826 would only make the adjustment
for 2009. Because the COLA is assumed in CBO's baseline, those
proposals would have no budgetary effect relative to that
baseline.
Estimate prepared by: Federal Costs: Federal Courts,
Benefits--Dwayne M. Wright (226-2840), Housing--DavidNewman
(226-2840), Education and Vocational Rehabilitation--Camille
Woodland (226-2840), Government Training--Matthew Pickford
(226-2860); Impact on State, Local, and Tribal Governments:
Lisa Ramirez-Branum (225-3220); Impact on the Private Sector:
Daniel Frisk (226-2900).
Estimate approved by: Peter H. Fontaine, Assistant Director
for Budget Analysis.
Regulatory Impact Statement
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee on Veterans'
Affairs has made an evaluation of the regulatory impact that
would be incurred in carrying out the Committee bill. The
Committee finds that the Committee bill would not entail any
regulation of individuals or businesses or result in any impact
on the personal privacy of any individuals and that the
paperwork resulting from enactment would be minimal.
Tabulation of Votes Cast in Committee
In compliance with paragraph 7 of rule XXVI of the Standing
Rules of the Senate, the following is a tabulation of votes
cast in person or by proxy by members of the Committee on
Veterans' Affairs at its June 26, 2008, meeting. The Committee,
by voice vote, ordered S. 3023 reported favorably to the
Senate, subject to amendment.
On that date, the Committee considered two amendments
offered by Senator Burr regarding the recall of retired judges
and an annual reporting requirement on the workload of the
United States Court of Appeal for Veterans Claims. The
amendments were accepted by voice vote.
The Committee then considered an amendment offered by
Senator Burr regarding a contingent increase in the number of
judges on the United States Court of Appeals for Veterans
Claims. The amendment was defeated by a 7 to 7 vote.
----------------------------------------------------------------------------------------------------------------
Yeas Senator Nays
----------------------------------------------------------------------------------------------------------------
Mr. Rockefeller X
Ms. Murray X
Mr. Obama
Mr. Sanders X
Mr. Brown X
Mr. Webb X
Mr. Tester X
X Mr. Burr
X (by proxy) Mr. Specter
X Mr. Craig
X Mr. Isakson
X (by proxy) Mr. Graham
X (by proxy) Ms. Hutchison
X Mr. Wicker
Mr. Chairman X
----------------------------------------------------------------------------------------------------------------
7 TALLY 7
----------------------------------------------------------------------------------------------------------------
The Committee then considered an amendment offered by
Senator Burr regarding temporary expansion in the number of
judges on the United States Court of Appeals for Veterans
Claims. The amendment was defeated by a 7 to 7 vote.
----------------------------------------------------------------------------------------------------------------
Yeas Senator Nays
----------------------------------------------------------------------------------------------------------------
Mr. Rockefeller X
Ms. Murray X
Mr. Obama
Mr. Sanders X
Mr. Brown X
Mr. Webb X (by proxy)
Mr. Tester X
X Mr. Burr
X (by proxy) Mr. Specter
X Mr. Craig
X Mr. Isakson
X (by proxy) Mr. Graham
X (by proxy) Ms. Hutchison
X Mr. Wicker
Mr. Chairman X
----------------------------------------------------------------------------------------------------------------
7 TALLY 7
----------------------------------------------------------------------------------------------------------------
The Committee then considered an amendment offered by
Senator Burr regarding the retirement rules applicable to any
judge appointed to fill one of the additional judicial
positions on the United States Court of Appeals for Veterans
Claims proposed by section 401 of the Committee bill. The
amendment was defeated by a 7 to 7 vote.
----------------------------------------------------------------------------------------------------------------
Yeas Senator Nays
----------------------------------------------------------------------------------------------------------------
Mr. Rockefeller X
Ms. Murray X
Mr. Obama
Mr. Sanders X
Mr. Brown X
Mr. Webb X
Mr. Tester X
X Mr. Burr
X (by proxy) Mr. Specter
X Mr. Craig
X Mr. Isakson
X Mr. Graham
X (by proxy) Ms. Hutchison
X Mr. Wicker
Mr. Chairman X
----------------------------------------------------------------------------------------------------------------
7 TALLY 7
----------------------------------------------------------------------------------------------------------------
Agency Report
On May 7, 2008, Keith Pedigo, Associate Deputy Under
Secretary for Policy and Program Management of the Department
of Veterans Affairs, appeared before the Committee and
submitted testimony of the Department's views of the bills.
Excerpts from this statement are reprinted below:
STATEMENT OF KEITH PEDIGO, ASSOCIATE DEPUTY UNDER SECRETARY FOR POLICY
AND PROGRAM MANAGEMENT, U.S. DEPARTMENT OF VETERANS AFFAIRS
Mr. Chairman and members of the Committee, good morning. I
am pleased to be here today to provide the Department of
Veterans Affairs' (VA) views on pending benefits legislation. I
will not be able to address a few of the bills on today's
agenda because VA received them in insufficient time to
coordinate the Administration's position and cost estimates,
but we will provide that information in writing for the record.
* * * * * * *
S. 1718
S. 1718, the ``Veterans Education Tuition Support Act,''
would amend the Servicemembers Civil Relief Act to provide
servicemembers reimbursement of tuition for programs of
education interrupted by military service, deferment of student
loans, and reduced interest rates for servicemembers during
periods of military service. Because that Act is implemented by
DOD, we defer to that department regarding the merits of S.
1718.
S. 2090
S. 2090 would require the U.S. Court of Appeals for
Veterans Claims (Veterans Court) to adopt rules to protect the
privacy and security of documents retained by, or
electronically filed with, the court. It would require the
rules to be consistent with other Federal courts' rules and to
take into consideration the best practices in Federal and state
courts to protect private information.
This bill would extend the Veterans Court's existing
authority and anticipates the upcoming conversion from paper
filing to electronic filing. The court's current Rules of
Practice and Procedure provide several tools to safeguard
sensitive information. For example, Rule 11 (c)(2) permits the
Veterans Court, on its own initiative or on motion of a party,
to ``take appropriate action to prevent disclosure of
confidential information.'' Rule 48 permits the Veterans Court
to seal the Record on Appeal in appropriate cases. Rule 6
provides: ``Because the Court records are public records,
parties will refrain from putting the appellant's or
petitioner's VA claims file number on motions, briefs, and
responses (but not the Notice of Appeal (see Rule 3(c)(1)));
use of the Court's docket number is sufficient identification.
In addition, parties should redact the appellant's or
petitioner's VA claims file number from documents submitted to
the Court in connection with motions, briefs, and responses.''
This rule prevents the public from easily accessing a veteran's
Social Security number. VA supports efforts to protect Social
Security numbers.
The Secretary supports enactment of S. 2090 because the
importance of safeguarding sensitive information in a veteran's
files cannot be overemphasized. The proposal is logical given
the impending conversion from paper filing to electronic
filing, particularly in this distressing era of internet data
mining and identity theft.
S. 2091
S. 2091 would expand the number of active judges sitting on
the Veterans Court from seven to nine. We have witnessed the
progress that the Veterans Court has made in reducing its
inventory of cases through temporary recall of retired judges.
Under the current system, we believe the Court can effectively
manage its projected caseload within the funds requested in the
FY 2009 President's Budget.
* * * * * * *
S. 2471
S. 2471, the ``USERRA Enforcement Improvement Act of
2007,'' would make several changes to the enforcement of the
Uniformed Services Employment and Reemployment Rights Act.
Because that Act is implemented by the Department of Labor, we
defer to that department regarding the merits of S. 2471.
S. 2550
S. 2550, as proposed to be amended, the ``Combat Veterans
Debt Elimination Act of 2008,'' would authorize VA to refrain
from collecting all or part of a debt owed to the United States
under any program administered by VA (other than a housing or
small business program under chapter 37 of title 38, United
States Code) by a service member or veteran who dies as a
result of an injury incurred or aggravated in the line of duty
while serving in a theater of combat operations in a war or in
combat against a hostile force during a period of hostilities
after September 11, 2001, if the Secretary determines that
termination of collection is in the best interest of the United
States.
In response to the Committee Chairman's request, we
provided VA's views on this bill, as introduced, in a letter
dated February 13, 2008. In that letter, we raised certain
concerns and suggested revisions. The bill, as proposed to be
amended, appears to address VA's concerns. Accordingly, VA
supports S. 2550, as proposed to be amended.
We estimate that enactment of this bill would result in
additional benefits cost of $5,000 for FY 2009, and a 10-year
cost of $50,000. In determining the costs, VA used the amount
of debt of 21 fallen service members. In relative terms, the
total amount of accumulated debt over almost 4 years of
collecting the information is so small, and the pattern of that
accumulation so sporadic, that we would have little expectation
of a material increase in the amount of benefit indebtedness.
* * * * * * *
S. 2674
S. 2674, the ``America's Wounded Warriors Act,'' would
implement the recommendation of the President's Commission on
Care for America's Returning Wounded Warriors (``Dole-Shalala
Commission'') to ``Completely Restructure the Disability and
Compensation Systems.''
VA defers to DOD with regard to title I of S. 2674, which
would amend chapter 61 of title 10, United States Code, to
create an alternative disability retirement system for certain
servicemembers.
Title II would completely restructure the VA disability
compensation program. Section 201 would require VA to conduct a
study to determine the amount of compensation to be paid for
each rating of disability assignable to veterans for service-
connected disabilities. It would require VA to ensure that its
determinations reflect current concepts of medicine and
disability and take into account loss of quality of life and
average loss of earning capacity resulting from specific
injuries. In conducting the study, VA could take into account
the findings, determinations, and results of any completed or
on-going study or report that is applicable. Section 201 also
would require VA to submit to the Committees on Veterans'
Affairs of the Senate and House of Representatives a report
that would include VA's findings under the required study, as
well as VA's findings with respect to matters covered by the
study arising from the report of the Veterans' Disability
Benefits Commission (VDBC) and the reports of such other
independent advisory commissions that have studied the same
matters. The report would be due to the Committees not later
than 270 days after commencement of the required study.
Section 202 of the bill would require VA to conduct a study
to determine the appropriate amounts and duration of transition
payments to veterans who are participating in a rehabilitation
program under chapter 31 or chapter 17 of title 38, United
States Code. In conducting the study, VA could take into
account the findings, determinations, and results of any
completed or on-going study or report that is applicable.
Section 202 also would require VA to submit to the Committees
on Veterans' Affairs of the Senate and House of Representatives
a report that would include VA's findings under the required
study, as well as VA's findings with respect to matters covered
by the study arising from the report of the VDBC and the
reports of such other independent advisory commissions that
have studied the same matters. The report would be due to the
Committees not later than 270 days after commencement of the
required study.
These two sections are similar to section 201 of the
Administration's proposal to implement the report of the Dole-
Shalala Commission. VA supports efforts to improve procedures
for disability retirement of service members, to enhance
authorities for the rating and compensation of service-
connected disabilities, and to develop procedures to encourage
completion of vocational rehabilitation plans under chapter 31.
However, we do not believe that enactment of these sections is
necessary in light of actions already undertaken by VA to study
the same matters as these sections would require. In February
2008, VA entered into a contract with Economic Systems, Inc.,
of Falls Church, Virginia, to study the appropriate levels of
compensation necessary to compensate veterans for loss of
earning capacity and loss of quality of life caused by service-
related disabilities and the nature and feasibility of making
long-term transition payments to veterans separated from the
Armed Forces due to disability while such individuals are
undergoing rehabilitation under chapter 31 or chapter 17. These
studies are expected to be completed by August of this year. We
will provide the Committees with copies of these studies.
Section 203 of S. 2674 would require VA to conduct a study
to identify factors that may preclude veterans from completing
their vocational rehabilitation plans and actions VA may take
to assist and encourage veterans in overcoming such factors.
The study would examine: (1) measures used in other disability
systems to encourage completion of vocational rehabilitation
plans; (2) any survey data available to VA that relate to
matters covered by the study; (3) the results of the studies
required by sections 201 and 202 of this bill; (4) the report
of the VDBC; and (5) the report of the Dole-Shalala Commission.
The study would also consider the extent to which bonus
payments or other incentives may be used to encourage
completion of vocational rehabilitation plans under chapter 31
and such other matters VA considers appropriate. Not later than
270 days after commencement of the study, VA would be required
to submit to the Committees on Veterans' Affairs a report
including the findings of the study and any appropriate
recommendations and proposals for legislative or administrative
action needed to implement the recommendations.
There is no similar provision in the Administration's
proposal. However, the Administration's proposal would
authorize the payment of bonuses as an incentive to completing
a vocational rehabilitation program. Thus, S. 2674 would
further the same objective as the Administration's proposal. In
addition, we believe that the study conducted by Economic
Systems, Inc., which is already in progress, is consistent with
the intent of this section.
Section 204 of the bill would require VA, not later than
one year after the later of the dates of the reports required
by sections 201(f) and 202(e)1 of the bill, to submit to
Congress a proposal including a statement of purpose of the
disability compensation and transition payments that would be
required pursuant to enactment of section 207 of the bill, a
statement of the amounts of compensation for service-connected
disability that would be required pursuant to enactment of that
section, and a statement of the amounts and duration of
transition benefits to be payable pursuant to enactment of
section 207 of this bill to veterans participating in a
rehabilitation program under chapter 31 or chapter 17 of title
38. The rates, amounts, and duration of these benefits would be
exempt from judicial review. We do not support enactment of
this section; we prefer the Administration's proposal.
The new compensation system would apply to veterans who
have a disability rated as service connected under chapter 11
of title 38, United States Code on the effective date of the
new chapter 12 compensation system, and who file a claim with
respect to such disability or another disability on or after
that date, as well as to veterans who do not have a disability
rated as service connected under chapter 11 of title 38, United
States Code on the effective date of the new chapter 12
compensation system, and who file a claim with respect to
disability on or after that date. The disability rating for
claims filed under chapter 12 would have to take into account
all service-connected disabilities. The new chapter 12
compensation system would become effective, if at all, at most
85 days after VA submitted to Congress its proposal as to
amounts of compensation and amounts and duration of transition
benefits that are payable under the system. An award or
increase of compensation with regard to a compensation claim
filed during the 3-year period beginning on the effective date
of implementation of the new VA compensation system could be
retroactive for 3 years from the date of application or
administrative determination of entitlement, whichever is
earlier.
The new VA compensation system would also include
transition payments to cover living expenses for disabled
veterans and their families, consisting of either 3 months of
base pay if the veterans are returning to their community
following retirement and not participating in further
rehabilitation or longer-term payments to cover family living
expenses if they are participating in further rehabilitation
under chapter 31 or chapter 17. VA would also have authority to
make transition payments to eligible veterans who are retired
or separated under the alternate DOD system.
Section 208 of S. 2674 would also add a new chapter 14 to
title 38, United States Code, which would permit a veteran
retired under the new DOD system and entitled to compensation
under new chapter 12 to elect a 6.5-percent reduction in the
entire amount of compensation to provide a supplemental
survivor benefit for a surviving spouse or child(ren). A
survivor would be entitled to 55 percent of the veteran's total
compensation payable at the time of the veteran's death. Also
under section 208, if a veteran elects to provide a survivor
benefit to the veteran's child(ren) rather than spouse, VA
would have to notify the veteran's spouse of the veteran's
election.
VA has the following concerns regarding title II of S.
2674.
Currently, 2.7 million veterans are in receipt of VA
disability compensation under chapter 11 of title 38, United
States Code. By simply filing a compensation claim when or
after chapter 12 goes into effect, all of these veterans would
become eligible for compensation under chapter 12, and all of
their service-connected disabilities would have to be rerated
under the rating schedule applicable to chapter 12. Our initial
review of new chapter 12 indicates that benefits under the new
VA compensation system would be far more favorable than
benefits under current chapter 11. As a result, VA could be
overwhelmed with claims by veterans seeking to have their
service-connected disabilities compensated under new chapter
12.
VA would be required to submit to Congress its proposals
regarding amounts of disability compensation and the amounts
and duration of transition benefits not later than one year
after submitting the later of its reports on compensation and
transition benefits. VA would have 270 days from commencement
of each study to report to Congressional committees on the
study results. VA would have to wait for completion of the
compensation study before drafting a rating schedule. As a
result, VA would have approximately 15 months to draft a rating
schedule compensating for loss of earnings and quality of life,
propose it through notice-and-comment rulemaking, consider
comments received, and issue a final rule. This is insufficient
time considering the scope and complexity of the rating
schedule.
The requirement that the Secretary of Veterans Affairs
propose the amounts of disability compensation and the amounts
and duration of transition benefits is insufficiently
prescriptive for VA to formulate a proposal that will achieve
the statutory objectives. The bill should provide more specific
guidance in this regard. The legislature must give specific
guidance to executive agencies when authorizing them to
establish entitlement programs administratively. In addition,
if S. 2674 were enacted and later challenged on constitutional
grounds, the provision purporting to exempt the rates, amounts,
and duration of these benefits from judicial review may be
unavailing because Federal courts generally will interpret
statutory provisions to avoid the serious constitutional
questions that would arise if a statute were construed to deny
any judicial forum for a colorable constitutional claim.
Although it would require VA to study actions VA could take
to help and encourage veterans to overcome impediments to
completing their vocational rehabilitation plans, S. 2674 would
not authorize an achievement bonus payable upon completion of
certain milestones of a chapter 31 vocational rehabilitation
program. We believe that such payments are necessary to serve
as incentives to encourage veterans to remain in the VA
vocational rehabilitation program and complete their vocational
rehabilitation objectives.
S. 2674 would authorize a survivor benefit that would be
based upon a percentage of a veteran's compensation for loss of
quality of life as well as earnings loss. Compensation for the
effect of a disability on the veteran's quality of life would
be similar to damages for pain and suffering awarded to an
injured person in a tort lawsuit. Compensation for a veteran's
survivors under title 38, United States Code, on the other
hand, is intended to replace the economic loss to the veteran's
survivors resulting from the veteran's death. It would
therefore be inconsistent to calculate survivors benefits under
new chapter 14 based in part upon the compensation paid to a
veteran for pain and suffering rather than based upon the loss
to the veterans' survivors caused by loss of the veteran's
earning capacity.
S. 2674 does not authorize VA to provide services to family
members of eligible veterans as necessary to facilitate the
family members' assistance in treatment, rehabilitation, or
long-term care of the veteran, i.e., education concerning the
veteran's injuries and expected progress and caregiver
training, counseling, and psychological services. Because the
Administration's proposed bill does authorize such services, we
favor that bill over S. 2674.
All in all, we prefer the Administration's proposal to S.
2674.
* * * * * * *
S. 2737
S. 2737, the ``Veterans' Rating Schedule Review Act,''
would give the Veterans Court jurisdiction to review whether,
and the extent to which, the VA Schedule for Rating
Disabilities (rating schedule) complies with ``applicable
requirements of chapter 11'' of title 38, United States Code.
VA opposes S. 2737 for the following reasons. First,
extending the Veterans Court's jurisdiction to include review
of the rating schedule for compliance with applicable statutes
would likely increase litigation, over both the validity of
rating schedule provisions and the scope of the jurisdictional
extension itself. Every claim in which VA grants service
connection involves consideration of some portion of the
schedule for purposes of rating the service-connected
disability, as does every claim for an increased rating. S.
2737 would essentially expose the rating schedule to judicial
review in every such claim appealed to the Veterans Court. Any
case in which the court feels that a rating-schedule provision
prevents a veteran from receiving the full amount of
compensation to which the court considers the veteran entitled
could be viewed as posing a reviewable conflict between the
rating schedule and some statute in chapter 11. If S. 2737 were
enacted, the number of appeals to the Veterans Court could
skyrocket, an increase in case load the Veterans Court could
ill afford. According to the Veterans Court's annual reports,
the court's caseload has doubled since 1998. Adding the
increase of appeals resulting from the jurisdictional extension
to the already growing case load could delay final resolution
of all appeals before that court.
A change in the court's jurisdiction would itself stimulate
litigation. Undoubtedly, claimants' counsel would test the
limits of the court's jurisdiction, giving rise to protracted
litigation of uncertain outcome. The courts are still grappling
with the parameters of the Veterans Claims Assistance Act of
2000 notice provisions some 8 years after the passage of that
statute. Besides burdening the courts, S. 2737 would require
additional VA resources to handle the increase in litigation
resulting from judicial review of whether the rating schedule
complies with chapter 11 requirements.
Second, S. 2737 would permit piecemeal review of individual
rating classifications, which are matters particularly within
VA's expertise. Establishing the criteria for rating
disabilities and the rates of compensation payable under those
criteria depends on gathering and analysis of medical facts,
matters of technical and medical judgment, including judgment
about what disabilities and levels of disability should be
included in the schedule. The prevention of piecemeal review
was Congress's rationale in originally proscribing review of
the rating schedule in the Veterans' Judicial Review Act.
Congress intended that no court should substitute its judgment
for the Secretary's as to what rating a particular type of
disability should be assigned.
Third, S. 2737 would create a jurisdictional inconsistency.
The bill would permit the Veterans Court to decide whether the
VA rating schedule is consistent with statutes in chapter 11,
but the United States Court of Appeals for the Federal Circuit
(Federal Circuit) would remain without jurisdiction under 38
U.S.C. Sec. 502 to review an action of the Secretary relating
to the adoption or revision of the rating schedule.
Nonetheless, the Federal Circuit would have jurisdiction under
38 U.S.C. Sec. 7292(a) to review a Veterans Court
interpretation of statute or regulation. Thus, the Federal
Circuit would be barred from reviewing the content of the
rating schedule on direct review but could review a Veterans
Court decision on whether the rating schedule complies with
chapter 11 requirements, which would likely require review of
the content of the rating schedule.
Finally, under current case law, the Veterans Court is not
totally without authority to review the rating schedule. The
Federal Circuit has held that 38 U.S.C. Sec. 7252(b) bars
judicial review of the content of the rating schedule and the
Secretary's actions in adopting or revising the content.
However, the Federal Circuit has also held that the courts,
including the Veterans Court, have jurisdiction to review the
correct interpretation of rating-criteria content, the
Secretary's actions in adopting or revising the criteria for
compliance with the Administrative Procedure Act, and
constitutional challenges to the rating schedule.
We cannot estimate the costs that would result from
enactment of S. 2737.
S. 2768
S. 2768 would temporarily increase the maximum loan
guaranty amount for certain housing loans guaranteed by VA.
Currently, the maximum guaranty amount is 25 percent of the
Freddie Mac conforming loan limitation, for a single family
home, as adjusted annually. This means that the current VA
maximum guaranty is $104,250 on a no-downpayment loan of
$417,000. In high-cost areas, defined by Freddie Mac as Alaska,
Guam, Hawaii, and the Virgin Islands, the maximum guaranty
amount is $156,375 on a no-downpayment loan of $625,500.
S. 2768 would provide VA similar authorizations related to
loan limitations such as those established by the recently
enacted Economic Stimulus Act, Public Law 110-185.
Specifically, it would increase the maximum guaranty amount to
be equal to 25 percent of the higher of: (1) the Freddie Mac
conforming loan limit; or (2) 125 percent of the area median
price for a single-family residence, not to exceed 175 percent
of the conforming loan limit. The higher guaranty amounts would
be authorized through calendar year 2011. An increase in the
maximum loan limit generally translates to more purchasing
power for veterans. VA supports the increase in loan guarantee
limits through December 31, 2008, consistent with the Economic
Stimulus Act's other loan provisions. However, we need
additional analysis to determine how the change in limit would
affect our loan program beyond that date.
* * * * * * *
S. 2889, Section 7
S. 2889, the ``Veterans Health Care Act of 2008,'' contains
legislative proposals that the Administration recently
submitted to Congress as part of the annual budget submission.
Section 7 would make permanent VA's authority to verify the
eligibility of recipients of, or applicants for, VA need-based
benefits and services using income data from the Internal
Revenue Service and the Social Security Administration. The
existing authority has been instrumental in correcting amounts
of benefits payments and determining health care eligibility,
co-payment status, and enrollment priority assignment; however,
this authority expires on September 30, 2008. Expiration of
this authority would interrupt the income verification process.
VA estimates that enactment of section 7 would result in
net discretionary savings of $8.2 million in FY 2009 and $270
million over 10 years.
* * * * * * *
Unnumbered Housing Refinance Legislation
S. xxxx would increase the maximum guaranty amount for
certain refinance loans, sometimes referred to as ``regular''
refinances, and would reduce the existing equity requirement
for such loans from 10 percent to 5 percent. In general, a
regular refinance loan is one in which a veteran refinances a
loan not already guaranteed by VA. The law currently limits
VA's guaranty to $36,000 on regular refinance loans and limits
the loan-to-value ratio (LTV) to 90 percent of the value of the
security. This means that the maximum loan amount a veteran
effectively may borrow with a VA guarantee is $144,000 and that
a veteran who has no equity in his or her home may obtain a
regular VA refinance loan for only 90 percent of the home's
appraised value.
The change proposed by S. xxxx would increase the maximum
guaranty amount on regular refinances by tying such amount to
the Freddie Mac Conforming Loan Limit. This means that a
veteran who meets VA's underwriting criteria could obtain a
guaranty of as much as $104,250 on a loan of $417,000.
Furthermore, S. xxxx would change the existing LTV requirement
for regular refinance loans by increasing the limit from 90
percent to 95 percent of the home's appraised value.
Unnumbered Foreclosure Relief Legislation
S. XXXX, the ``Preventing Unnecessary Foreclosure for
Servicemembers Act of 2008,'' would amend the Servicemembers
Civil Relief Act to protect against mortgage foreclosures for
certain disabled or severely injured servicemembers. Because
that Act would be implemented by DOD, we defer to that
department regarding the merits of this proposal.
Unnumbered Benefits Enhancement Legislation
Mr. Chairman, thank you for introducing S. xxxx, the
``Veterans' Benefits Enhancement Act of 2008,'' on behalf of
VA. Titles I and II of this bill would expand and enhance
veterans' benefits, as noted below.
TITLE I--EDUCATION BENEFITS
Section 101 of S. xxxx would eliminate the requirement that
educational institutions providing non-accredited courses must
report to VA any credit that was granted by that institution
for an eligible person's prior training.
Under current law, State approving agencies approve, for VA
education benefits purposes, the application of educational
institutions providing nonaccredited courses if the institution
and its courses meet certain criteria. Among these is the
requirement that the institution maintain a written record of
the previous education and training of the eligible person and
what credit for that training has been given the individual.
The institution must notify both VA and the eligible person
regarding the amount of credit the school grants for previous
training.
VA proposes to eliminate that notification requirement as
it pertains to VA. VA will still have oversight, just as it
does with accredited courses. VA will review records during
compliance visits to assure the institution is evaluating and
appropriately reducing program requirements because of credit
given for prior training.
Removing the reporting requirement would shorten claims
processing time because VA would not have to review each claim
for the presence of such notice and, if not submitted, have to
check with the school and student to assure the requirement has
been met. It would also permit more cases to be processed
through VA's Electronic Certification Automated Processing
(ECAP) program. The ECAP system cannot process claims where
proper credit reporting is at issue because those cases require
manual development and review by a veteran's claims examiner.
The more claims VA can process through the ECAP system, the
more timely VA beneficiaries will receive their benefits.
Following up with schools for the written notification
burdens the school certifying official and student, as well as
VA. Often the school certifying official, who is responsible
for reporting a veteran's enrollment, is not the individual who
evaluates credit. The certifying official has no control over
how long it takes the school to accomplish the review and
granting of prior credit.
Further, several of VA's stakeholders, including the
National Association of Veterans' Program Administrators, have
recommended that VA review school records to determine granting
of prior credit during compliance visits rather than require
the school to submit written reports. Eliminating this
requirement would streamline the administration of educational
assistance benefits and improve the delivery of benefits to
veterans, reservists, and other eligible individuals.
There would be no costs associated with enactment of this
section.
Section 102 of this bill would reduce from 10 days to 5
days the current waiting period required prior to the student's
affirmation of an enrollment agreement with an educational
institution to pursue a program of education exclusively by
correspondence.
Under current law, an enrollment agreement signed by a
veteran, spouse, or surviving spouse is not effective unless he
or she, after 10 days from the date of signing the agreement,
submits a written and signed statement to VA affirming the
enrollment agreement. If the veteran, spouse, or surviving
spouse at any time notifies the institution of his or her
intention not to affirm the agreement, the institution, without
imposing any penalty or charging any fee, promptly refunds all
amounts paid.
The statutory 10-day period is twice the requirement of the
Distance Education and Training Council (DETC) accrediting body
standard, which states that institutions will allow a full
refund of all tuition expenses paid if a student cancels within
5 days after enrolling in a course. Reducing the affirmation
waiting period to 5 days would make the statute consistent with
the DETC standard and eliminate confusion. It would also permit
eligible individuals to begin their programs sooner. Should
they decide at any time not to affirm the enrollment agreement,
the eligible individuals would still be entitled to a refund of
all amounts paid.
Finally, this proposal would allow VA to strengthen its
partnership with the National Association of State Approving
Agencies, which has had this issue high on its list of
legislative priorities. There would be no costs associated with
enactment of this section. Section 103 of the bill would
eliminate the requirement that an individual must file an
application with VA when that individual remains enrolled at
the same school but changes his or her program of study.
Under current law, a student who desires to initiate a
program of education must submit an application to VA in the
form prescribed by VA. If the student decides a different
program is more advantageous to his or her needs, that
individual may change his or her program of study once.
However, additional changes require VA to determine that the
change is suitable to the individual's interests and abilities.
It is rare for VA to deny a change of program, especially if
the student is continuing in an approved program at the same
school.
Under this provision, VA would accept the new program
enrollment based on the certification of such enrollment from
the school without requiring additional certification from the
student. VA would still have oversight of program changes by
reviewing school records when VA conducts its compliance
visits. Again, this requirement would be eliminated for program
changes only when the student remains enrolled at the same
school.
Section 103 also would allow VA to increase the number of
claims processed using the ECAP program without manual review
by a veterans claims examiner. Thus, since VA could award
benefits based only on the school's certification, without
having to wait for additional certification from the student,
VA could award benefits more timely and with less of a public
information collection burden.
There would be no costs associated with enactment of this
section.
Section 104 of the bill would eliminate the requirement
that wages be earned by veterans pursuing self-employment on-
job training authorized under section 301 of Public Law 108-
183. That section expanded the chapter 30 Montgomery GI Bill
program by authorizing educational assistance benefits for
full-time on-job training (OJT) of less than 6 months needed
for obtaining licensure to engage in a self-employment
occupation or required for ownership and operation of a
franchise.
Currently, all the provisions of title 38, United States
Code, that apply to VA's other OJT programs (except the
requirement that a training program has to be for least 6
months) apply to franchise-ownership OJT, including the
requirement that the trainee earn wages that are increased
incrementally. Through contact with the International Franchise
Association, VA has determined that OJT for new franchise
owners does not involve the payment of wages. Thus, if
franchise OJT programs are not exempted from the current title
38 wage requirements, no franchise-ownership OJT program will
ever be approved for VA benefits.
VA has determined that no direct costs would result from
enactment of this proposal. The estimated costs for
implementing the section 301 authority have been included in
the budget base each year since its enactment.
TITLE II--OTHER BENEFITS MATTERS
Section 201(a) of the bill would explicitly authorize VA to
stay temporarily its adjudication of a claim pending before
either a VA regional office (or other agency of original
jurisdiction) or the Board of Veterans' Appeals (Board) when
the stay is necessary to preserve the integrity of a program
administered under title 38, United States Code.
It is widely accepted that courts and administrative
adjudicative agencies generally have the authority to manage
their case loads and to stay cases as necessary for proper
management. VA has historically used such authority sparingly
to avoid waste and delay and to ensure consistency on important
issues of law, usually when VA has appealed a controlling
adverse decision by the U.S. Court of Appeals for Veterans
Claims (Veterans Court). However, the Veterans Court recently
curtailed this authority in Ramsey v. Nicholson, 20 Vet. App.
16, (2006), and Ribaudo v. Nicholson, 20 Vet. App. 552 (2007)
(en banc), effectively assuming supervisory control of VA's
adjudication docket.
In Ramsey, the Veterans Court held that VA could not stay
cases while it appealed the Veterans Court's decision in Smith
v. Nicholson, 19 Vet. App. 63 (2005), which required VA to pay
benefits in a manner VA believed to be unauthorized by law and
which VA had appealed to the Federal Circuit. Ramsey would have
required VA to pay those benefits, irrespective of VA's
position on appeal, if VA had not prevailed in its Federal
Circuit appeal soon after Ramsey was issued. Had VA's appeal
not been resolved so quickly, VA would have been required to
grant claims pursuant to Ramsey while the Federal Circuit
reviewed the appeal, and many veterans would have received
benefits to which they were not entitled under the law.
Similarly, in Ribaudo, the Veterans Court held that VA
could not stay cases while it appealed Haas v. Nicholson, 20
Vet. App. 257 (2006). Haas is a significant decision, with
broad and costly implications, in which the Veterans Court
ordered VA to presume that veterans who served exclusively on
ships off the shores of Vietnam were nevertheless exposed to
defoliants (including Agent Orange) that were sprayed only over
land. In Ribaudo, the Veterans Court granted VA's request for a
stay of cases, but only after holding that VA's own authority
did not allow it to effect such a stay, thereby placing under
the control of the Veterans Court VA's entire docket of claims
affected by Haas, claims over which the Veterans Court does not
yet have direct jurisdiction.
Section 201(a) would also require VA to issue regulations
describing the factors it will consider in determining whether
and to what extent such stays are warranted and would permit
claimants to seek review of a stay in the Federal Circuit.
Because the Federal Circuit has exclusive jurisdiction over
appeals from the Veterans Court, it is in the best position to
determine whether a case should be stayed pending such an
appeal.
Under section 201(c), these new provisions would apply to
benefit claims received by VA on or after the date of enactment
and to claims received by VA before that date but not finally
adjudicated by VA as of that date.
Section 202(a) of the bill would clarify that the Board has
the authority to decide cases out of docket-number order when a
case has been stayed or when there is sufficient evidence to
decide a claim but a claim with an earlier docket number is not
ready for decision.
Current law requires that ``each case received pursuant to
application for review on appeal shall be considered and
decided in regular order according to its place upon the
docket.'' Section 202(a) would clarify that compliance with
that requirement does not require the Board to refrain from
deciding a case unaffected by a stay simply because that case
has a higher docket number than a stayed case. Expressly
authorizing the Board to decide cases out of docket order, when
a later case is ready for decision sooner than an earlier case,
would reflect current Board practice of allowing later cases
that are ready for decision to proceed while earlier cases are
still being developed. The Veterans Court's Ribaudo decision
rested in part on its interpretation of current law, and the
express recognition of the Board's practice will clarify that
that statute does not relieve VA of its duty to decide
administrative appeals quickly and efficiently.
Under section 202(b), this provision would apply to benefit
claims received by VA on or after the date of enactment and to
claims received by VA before that date but not finally
adjudicated by VA as of that date.
The provisions in sections 201 and 202, governing staying
of claims and management of the Board's docket, would save the
benefit costs and administrative expenses associated with
granting benefits under court precedents that are later
overturned on appeal. The amount of savings cannot be
predicted, because it would depend upon the nature of the court
decisions at issue, the extent to which those decisions compel
payments or other expenses, and the number of claimants
affected. However, VA has estimated that the Veterans Court's
decision in Haas will result in approximately $22.9 million in
administrative costs and approximately $2.1 billion in benefit
costs in the initial year of implementation.
Section 203 of the bill would eliminate the disparity
between eligibility for burial and eligibility for a memorial
headstone or marker. It would extend eligibility for memorial
headstones or markers to a veteran's deceased remarried
surviving spouse whose remains are unavailable for burial,
without regard to whether any subsequent remarriage ended, and
would ensure that the burial needs of veterans and their
survivors are more adequately met.
Current law authorizes VA to furnish an appropriate
memorial headstone or marker to commemorate eligible
individuals whose remains are unavailable. Individuals
currently eligible for such memorial headstones or markers
include a veteran's surviving spouse, which includes ``an
unremarried surviving spouse whose subsequent remarriage was
terminated by death or divorce.'' Thus, a surviving spouse who
remarried after the veteran's death is not eligible for a
memorial headstone or marker unless the remarriage was
terminated by death or divorce before the surviving spouse
died. However, a surviving spouse who remarried after the
veteran's death is eligible for burial in a VA national
cemetery without regard to whether any subsequent remarriage
ended.
Enactment of this provision would result in only nominal
benefit costs.
Section 204 of this bill would make permanent the authority
given by section 704 of Public Law 108-183 that allows VA to
contract for medical disability examinations using appropriated
funds other than funds available for compensation and pension.
Currently, that authority will expire on December 31, 2009.
This change would provide VA with flexibility needed to
effectively utilize supplemental and other appropriated funds
in responding to unanticipated needs and emergencies. The
demand for medical disability examinations has increased beyond
the limited number of requests that the current system was
designed to accommodate. The rise in demand is largely due to
an increase in the complexity of disability claims, an increase
in the number of disabilities claimed by veterans, and changes
in eligibility requirements for disability benefits. The
permanent authority to provide examinations to veterans through
non-VA medical providers would continue this important resource
for VA in providing high-quality patient care and improving
benefit delivery.
We estimate that enactment of section 204 would have no
significant financial impact.
Section 205(a) of the bill would extend full-time and
family Servicemembers' Group Life Insurance (SGLI) coverage to
Individual Ready Reservists (IRRs), individuals referred to in
38 U.S.C. Sec. 1965(5)(C). It would correct an oversight in the
Veterans' Survivor Benefits Improvements Act of 2001, which
provided such coverage for Ready Reservists, referred to in
section 1965(5)(B), but not for IRRs. IRRs should be provided
comparable coverage because many of them have been called up to
serve in Operation Enduring Freedom or Operation Iraqi Freedom.
Section 205(b) would provide that a dependent's SGLI
coverage would terminate 120 days after the date of the
member's separation or release from service, rather than 120
days after the member's SGLI terminates, as currently provided.
Under current law, a member retains SGLI coverage for 120 days
after separation or release from service, but a dependent
retains coverage for 120 days after that, for a total of 240
days after the member's separation from service, twice the
period of coverage for most insureds. This provision would
correct that inequity.
Section 205(c) would clarify that VA has the authority to
set premiums for SGLI coverage for the spouses of Ready
Reservists based on the spouse's age. This provision would
correct an inconsistency between 38 U.S.C. Sec. 1969(g)(1)(A),
which does not require identical premiums for coverage of
active duty members' spouses, and section 1969(g)(1)(B), which
may be read to imply that identical premiums for coverage of
Ready Reservists' spouses are required. This change would make
the law consistent with VA practice.
Section 205(d) would clarify that any person guilty of
mutiny, treason, spying, or desertion, or who, because of
conscientious objections, refuses to perform service in the
Armed Forces or refuses to wear the uniform of the Armed
Forces, forfeits all rights to Veterans' Group Life Insurance
(VGLI), as well as SGLI. This provision would be consistent
with public policy and would eliminate a distinction between
SGLI and VGLI insureds that has no rational basis.
There would be no costs associated with enactment of this
section.
Section 206 of the bill would authorize the Secretary to
provide Specially Adapted Housing (SAH) grants to active duty
servicemembers who reside temporarily with a family member.
Public Law 109-233 authorized the Secretary to provide such
assistance to veterans by adding a new section 2102A to title
38, United States Code. However, the new section did not
expressly include active duty servicemembers, nor did it amend
section 2101(c), the section that provides eligibility to
active duty servicemembers for other SAH grants.
This amendment also would ensure that, absent express
language to the contrary, active duty servicemembers would be
covered by future SAH benefit program amendments. Due to the
structure of chapter 21, active duty servicemembers on occasion
have been overlooked, inadvertently, in the course of amending
the SAH program. For instance, a renumbering of SAH provisions
in Public Law 108-454 inadvertently omitted the provision that
created SAH eligibility for active duty servicemembers.
Similarly, Public Law 109-233, failed to include authority for
VA to assist active duty servicemembers temporarily residing
with family members. This proposal would correct the latter
oversight and, by amending section 2101(c) more broadly, would
make the inclusion of otherwise eligible active duty
servicemembers the rule, rather than the exception.
There would be no costs associated with enactment of this
section.
Section 207 of the bill would designate the VA office
established to support contracting with small businesses, which
was required by section 15(k) of the Small Business Act (15
U.S.C. Sec. 644(k)), as the Office of Small Business Programs,
to more clearly represent that office's scope of authority. The
name would not reflect any change in emphasis or support for
disadvantaged small businesses, but rather would clarify that
the Office of Small Business Programs has the full range of
authority over many other small business programs. The new
title would capture the overarching nature of the program,
which encompasses the small disadvantaged business, the
service-disabled veteran-owned small business, the veteran-
owned small business, the qualified historically underutilized
business zone small business, the women-owned small business,
and the very small business programs.
There would be no costs associated with enactment of this
section.
* * * * * * *
VA does not have comments on the other bills included on
the agenda for today's hearing because it did not receive them
in time to develop and clear views and estimate costs.
This concludes my statement, Mr. Chairman. I would be happy
now to entertain any questions you or the other members of the
Committee may have.
* * * * * * *
The Secretary of Veterans Affairs.
Washington, DC, June 2, 2008.
Hon. Daniel K. Akaka,
Chairman,
Committee on Veterans' Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: I am pleased to provide the Committee
with the views of the Department of Veterans Affairs (VA) on
five bills that were not covered in VA's statement at the
Committee's May 7, 2008, hearing: S. 161, S. 2934, S. 2946, S.
2951, and S. 2965, 110th Cong. For the reasons explained below,
we support S. 161 and do not support S. 2934, S. 2946, S. 2951,
and S. 2965.
S. 161
S. 161, the ``Veterans' Disability Compensation Automatic
COLA Act,'' would provide for an automatic cost-of-living
increase in the rates of disability compensation for veterans
with service-connected disabilities and of dependency and
indemnity compensation (DIC) for the survivors of veterans
whose deaths are service related, whenever there is such an
increase in Social Security benefits and by the same percentage
as the percentage by which Social Security benefits are
increased. VA benefits would increase on the date Social
Security benefits are increased, which is December 1st of each
year. The new statutory provision authorizing this automatic
cost-of-living adjustment (COLA) would become effective on
January 1st of the year following enactment of this bill.
VA supports enactment of S. 161. We believe this proposed
automatic COLA would simplify the annual rate-increase
assessment process for compensation and DIC in the same manner
that the process for pension was simplified by indexing pension
increases to Social Security COLAs. We believe the annual
increases are necessary and appropriate to provide continuous
protection of the affected benefits from the eroding effects of
inflation. The worthy beneficiaries of these benefits deserve
no less.
Because future COLA estimates are already included in the
baseline President's budget, this legislation would not result
in additional costs.
S. 2934
S. 2934 would require VA to pay states a $300 plot
allowance for the burial in a state cemetery of the spouse,
surviving spouse, minor child, and (in the Secretary's
discretion) unmarried adult child of specified persons who are
eligible for burial in a national cemetery. The measure would
apply to individuals who die on or after the date of enactment.
VA does not support enactment of S. 2934. We believe
current law provides an adequate plot allowance if family
members are buried in the same plot as the veteran, which is
usually the case in state cemeteries, whether or not the
veteran dies first. An additional plot allowance for burial of
a family member in the same plot as the veteran would be
gratuitous. This bill would result in additional direct costs
for which no offsets have been identified, and also additional
administrative costs that must be considered in light of the
competing demands for scarce VA resources in meeting veterans'
burial needs.
We estimate that enactment of this bill would result in
mandatory costs of $2.1 million for FY 2009, $12.1 million over
the 5-year period from FY 2009 through FY 2013, and $28.6
million over the 10-year period from FY 2009 through FY 2018.
It would result in administrative costs of $245,000 for the
first year, $1.7 million over 5 years, and $4.6 million over 10
years.
S. 2946
S. 2946 would make a servicemember's natural stillborn
child an insurable dependent for purposes of the
Servicemembers' Group Life Insurance (SGLI) program. The term
``stillborn natural child'' would not include any fetus or
child extracted for purposes of an abortion.
VA does not support enactment of S. 2946. Private insurers
do not generally insure stillborn children. In fact, private
insurance coverage for a child typically does not begin until
the fourteenth day after a live birth.
The total cost to the SGLI program for adding stillborn
coverage would be $4 million annually based on an estimate of
400 stillbirths per year with a benefit of $10,000 per
stillbirth.
S.2951
S. 2951 would require the Secretary to report annually to
Congressional veterans' affairs committees on VA's progress in
addressing the causes of variances in veterans' compensation
payments. The reports would have to include a description of
the Veterans Benefits Administration's (VBA) efforts to
coordinate with the Veterans Health Administration (VHA) to
improve the quality of disability examinations, an assessment
of VBA's current personnel requirements, and a description of
any differences in the claim-submittal rates among various
veteran populations, as well as a description and assessment of
efforts undertaken to eliminate the differences.
VA does not support enactment of S. 2951 because it is
unnecessary. Over the past few years, VBA has achieved major
improvements in the delivery of benefits, including the quality
and consistency of benefit decisions. For instance, VBA has
made all regional offices consistent in organizational
structure and work process. VBA performs site surveys of
regional offices to ensure compliance with procedures, with
particular emphasis on current consistency issues. VBA has also
deployed new training tools and centralized training programs
that support accurate and consistent decision-making. In
addition, VBA has established specialized processing centers to
consolidate adjudication of certain types of claims to provide
better and more consistent decisions.
VBA has established an aggressive and comprehensive program
of quality assurance and oversight to increase the accuracy and
consistency of benefit decisions. As part of its quality
assurance program for disability evaluations, in FY 2008 VBA
began regularly monitoring the most frequently rated diagnostic
codes to assess the consistency of service-connection
determinations and assignment of disability ratings across
regional offices. These studies are used to identify where
additional guidance and training are needed to improve
consistency and accuracy, as well as to drive procedural or
regulatory changes. VBA also plans to begin studying the
consistency of decisions among raters late this summer.
VBA has developed jointly with VHA the Compensation and
Pension Examination Project (CPEP) to improve the quality and
consistency of compensation and pension examinations. CPEP is
developing computerized templates to ensure that examinations
are complete and to capture examination data.
Although we realize the importance of providing reports on
VA's progress regarding variances in compensation payments, we
believe that the measures VBA has taken sufficiently address
the need for accuracy and consistency in veterans' compensation
decisions and believe that VA's resources need to be directed,
instead, to address the growing challenge of timely
adjudicating veterans' claims. VA is committed to providing
accurate, consistent, and timely adjudications for those who
have so admirably served our Nation.
There are no mandatory costs associated with this bill
because it does not affect entitlement to benefits. However,
this legislation would require studies of patterns in claims
adjudication and the development of an enhanced tracking
mechanism to capture the required data. It would result in
total administrative costs of $10 million.
S. 2965
S. 2965 would require VA, in consultation with the
Department of Defense (DOD), to report to the Congressional
veterans' affairs committees on the feasibility and
advisability of including severe and acute Post Traumatic
Stress Disorder (PTSD) among the conditions covered by
traumatic injury protection coverage under SGLI. Section 1980A
of title 38, U.S. Code, provides an automatic injury protection
rider to SGLI for any SGLI insured who sustains a traumatic
injury that results in certain losses (TSGLI).
VA does not support enactment of S. 2965. We do not believe
that the TSGLI program is the appropriate vehicle for
addressing the needs of veterans and servicemembers afflicted
with PTSD, and we cannot foresee that undertaking the
assessment required under this bill would affect that position.
The intent of Congress in establishing the TSGLI program
was to provide rapid financial relief to traumatically injured
servicemembers and their families during periods of recovery
and rehabilitation. The program is designed to provide
servicemembers the equivalent of accidental-dismemberment
coverage available under civilian life-insurance plans. We are
unaware of any equivalent private-sector life-insurance riders
covering PTSD or other mental disorders. Further, the nature of
PTSD, with periods of remission and reappearance, the range of
its severity, and the variable time of its onset, make PTSD
unsuitable for this kind of financial benefit. For these
reasons, we believe that disability resulting from PTSD and
other service-connected mental disorders, like other diseases,
is most appropriately addressed by the existing disability-
compensation program.
The Office of Management and Budget has advised that there
is no objection to the submission of this report from the
standpoint of the Administration's program.
Sincerely yours,
James B. Peake, M.D.
* * * * * * *
The Secretary of Veterans Affairs.
Washington, DC, July 8, 2008.
Hon. Daniel K. Akaka,
Chairman,
Committee on Veterans' Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: I am pleased to provide the Committee
with the views of the Department of Veterans Affairs (VA) on S.
3023, 110th Cong., the ``Veterans' Notice Clarification Act of
2008.'' VA supports S. 3023.
Section 5103(a) of title 38, U.S. Code, requires that, upon
receipt of a complete or substantially complete application for
veterans benefits, VA must notify a claimant of the information
and evidence necessary to substantiate the claim and the
respective obligations of VA and the claimant to obtain the
requisite information and evidence. S. 3023 would amend 38
U.S.C. Sec. 5103(a) to authorize the Secretary of Veterans
Affairs to prescribe regulations regarding the content of the
notice to be provided by VA. The bill would require the
Secretary to prescribe regulations that specify: (1) the
content of the notice based upon the type of claim filed, e.g.,
original claim, claim to reopen a previously disallowed claim,
or a claim for increased benefits; (2) the general information
and evidence required to substantiate the basic elements of
such type of claim; and (3) the timing of the issuance of the
notice. The bill would also authorize the Secretary to
prescribe regulations providing additional or alternative
contents for notice if appropriate to the benefit or services
sought under the claim.
When VA promulgated 38 C.F.R. 3.159(b)(1) to implement
current section 5103(a), VA interpreted the statute to require
generic rather than specific notice after the initial claim for
benefits has been filed. 66 Fed. Reg. 45,620, 45,622 (2001). In
adopting this approach, VA explained that ``[t]he statutory
notice required by [section 5103(a)] occurs at an early point
in the claims process when * * * VA does not yet know what
kinds of specific evidence to try to obtain on behalf of the
claimant.'' Id. VA also declined a public commenter's
suggestion to provide in the regulation that, ``if VA receives
evidence that is inadequate to substantiate the claim,'' VA
would ``contact the claimant and give him or her the
opportunity to correct the inadequacy or bolster the
evidence.'' Id. at 45,623. VA concluded that section 5103(a)
does not require such ongoing and specific notification, that
undertaking to provide such notice would be administratively
unworkable and would cause undue delays in claim adjudications,
and that the type of notice sought is properly provided at the
point that VA adjudicates the claim. Id. The United States
Court of Appeals for the Federal Circuit (Federal Circuit) held
that VA's decision to provide generic rather than case-specific
notice under section 3.159(b)(1) is consistent with the statute
and is a ``reasonable interpretation'' of 38 U.S.C.
Sec. 5103(a) to which a court must defer. Wilson v. Mansfield,
506 F.3d 1055, 1059-60 (Fed. Cir. 2007); Paralyzed Veterans of
Am. v. Secretary of Veterans Affairs, 345 F.3d 1334, 1337 (Fed.
Cir. 2003).
Notwithstanding this direction from the Federal Circuit,
the United States Court of Appeals for Veterans Claims
(Veterans Court) continues to impose increasingly numerous and
case-specific notice requirements under 38 U.S.C. Sec. 5103(a)
for each type of claim as to which a VA notice letter has come
before it for review. E.g., Palor v. Nicholson, 21 Vet. App.
325 (2007) (claim from person who served in Philippine guerilla
forces); Hupp v. Nicholson, 21 Vet. App. 342, 352-53 (2007)
(claim for dependency and indemnity compensation); Kent v.
Nicholson, 20 Vet. App. 1, 9-10 (2006) (claim to reopen);
Dingess v. Nicholson, 19 Vet. App. 473, 488-89 (2006), aff'd
per curiam, Nos. 2006-7247 & 2006-7312, 2007 WL 1686737 (Fed.
Cir. June 5, 2007) (claim for service connection). Most
recently, the Veterans Court held that, when VA receives a
claim for an increased rating, if the diagnostic code (DC) in
the VA rating schedule under which a claimant's disability is
rated contains criteria necessary for entitlement to a higher
disability rating that would not be satisfied by the claimant
demonstrating a noticeable worsening or increase in severity of
the disability and the effect that worsening has on the
claimant's employment and daily life, VA must provide at least
general notice of the requirements of the particular DC to the
claimant. Vazquez-Flores v. Peake, 22 Vet. App. 37, 43 (2008),
motion for stay denied, 22 Vet. App. 91 (2008), motion for
recon. denied, 2008 WL 1990812 (Vet. App. May 9, 2008), motion
for en banc review denied, 2008 WL 2132309 (Vet. App. May 21,
2008). The Veterans Court also held that section 5103(a)
requires VA to provide notice of the criteria of any DC that is
cross-referenced in the previously assigned DC. Vazquez-Flores,
22 Vet. App. at 93.
The pattern of imposing increasing specificity on VA's
notices has several burdensome effects on the Department.
First, it potentially requires remand of numerous previously-
decided cases involving similar section 5103(a) notices,
diverting adjudication resources from other pending claims.
Each time the Veterans Court finds that a particular type of
notice letter is inadequate, the erroneous notice that VA
provided in all similar cases before the decision is
presumptively prejudicial to appellants, potentially requiring
wide-scale remands and readjudications. See Sanders v.
Nicholson, 487 F.3d 881 (Fed. Cir. 2007), and Simmons v.
Nicholson, 487 F.3d 892 (Fed. Cir. 2007), cert. granted, 76
U.S.L.W. 3654 (U.S. June 16, 2008) (No. 07-1209). Second,
enormous administrative burdens are incurred in reprogramming
computers and revising VA's notices to comply with each
Veterans Court decision interpreting section 5103(a). Third,
requiring case-specific notice at the initial stages of a claim
requires a substantially greater expenditure of time and
resources in each case than VA's existing practice of providing
generally-applicable notice based on the type of claim filed.
Finally, the increased specificity required by the Veterans
Court threatens to make VA's notice increasingly complex and
difficult for claimants to read and understand, threatening the
very purpose and utility of the notice.
S. 3023 would address these concerns. First, this
legislation would incorporate the Federal Circuit's conclusion
that VA must provide only generic notice under 38 U.S.C.
Sec. 5103(a), a holding which is consistent with the point in
the claims process at which VA provides notice, i.e.,
immediately upon receipt of an application for veterans
benefits, when VA does not yet know what kinds of specific
evidence to try to obtain on behalf of the claimant. The bill
would also reinforce VA's ability to fill gaps or address any
ambiguities in 38 U.S.C. Sec. 5103(a) via the promulgation of
regulations to which a reviewing court would have to defer so
long as the regulations are not arbitrary, capricious, or
manifestly contrary to the statute. Chevron U.S.A., Inc. v.
Natural Res. Def. Council, Inc., 467 U.S. 837, 843-44 (1984).
As a result, the legislation would eliminate the need for VA to
continually revise its notice letters and to reissue notices to
claimants and would allow VA to dedicate its resources to
adjudicating the more than 800,000 claims filed annually. S.
3023 would also allow VA to make its notice more readily
understandable and useful to claimants by providing generic
notice of the evidence necessary to substantiate the type of
claim filed.
There would be no costs associated with enactment of S.
3023.
The Office of Management and Budget has advised that there
is no objection to the submission of this report from the
standpoint of the Administration's program.
Sincerely yours,
James B. Peake, M.D.
* * * * * * *
SUPPLEMENTAL VIEWS OF SENATOR BURR
On June 26, 2008, the Senate Committee on Veterans' Affairs
(hereinafter, ``Committee'') voted to favorably report S. 3023,
as amended, the Veterans' Benefits Improvement Act of 2008
(hereinafter, ``Committee bill''). This bill contains many
valuable provisions, including an extension of the time within
which spouses of seriously disabled veterans may use their
education benefits from the Department of Veterans Affairs
(hereinafter, ``VA'') and a requirement that human resources
specialists in the Federal executive branch receive training on
the Uniformed Services Employment and Reemployment Rights Act.
I am pleased that these provisions and others were included in
the Committee bill and, on the whole, believe this is a
worthwhile piece of legislation.
These supplemental views are primarily meant to express my
concerns about section 401 of the Committee bill, which would
permanently expand the size of the United States Court of
Appeals for Veterans Claims (hereinafter, ``CAVC'' or
``Court'') from seven to nine judges. At the outset, I want to
be clear that I fully support providing the Court with the
resources it needs to timely decide veterans' cases and that I
sincerely appreciate the tremendous effort of the Court's
judges and staff in recent years to increase productivity.
However, I do not believe we have sufficient information at
this time to determine whether the permanent addition of judges
is the best way to help the Court deal with its caseload. In
addition, I think the approach taken in the Committee bill
would miss an important opportunity to strategically plan ahead
to ensure that service to veterans will not be disrupted again
in the future by multiple judicial retirements at the Court.
I. Court's Workload
By way of background, the CAVC provides judicial review of
decisions rendered by VA's Board of Veterans' Appeals on claims
for VA benefits and is authorized to have seven judges. In
September 2007, the CAVC submitted a legislative proposal to
the Committee, requesting an increase in authorized judges from
seven to nine. The Court noted that the number of incoming
cases at the Court reached a record high in fiscal year 2007
and that the Court's ``per-judge average for incoming cases
each year now ranks among the highest in the federal appellate
system.'' In addition, the Court pointed to recent staffing
increases at VA, which may increase the volume of cases being
decided by the Board of Veterans' Appeals. The Court projected
that its incoming caseload will ``increase proportionally'' if
the volume of cases decided by the Board of Veterans' Appeals
grows. In sum, the Court's primary reason for requesting more
judges is based on the raw number of incoming cases expected
now and in the future.
Although the level of incoming cases is certainly one
indicator of the Court's resource needs, it does not answer the
key question in assessing the need for more judgeships: What is
the actual workload burden on the Court's existing judges?
Indeed, not all cases that are filed at the Court will
eventually reach a judge and not every case will require the
same amount of judge-time to resolve. Some cases are resolved
by the Clerk of the Court, such as when an appellant fails to
pay the required filing fee. Other cases may be resolved
through the efforts of the Court's Central Legal Staff, which
conducts pre-briefing conferences with the parties. In
addition, the complexity of cases that ultimately reach a judge
may vary significantly, based on such factors as the arguments
raised, the number of issues involved, and the size of the
record. In my view, to determine the actual workload burden on
the judges would require more information about how many cases
the judges actually handle, the nature and complexity of the
cases before the judges, and how much judge-time is required to
handle various types of cases.
In fact, that type of analysis is used elsewhere in the
Federal judiciary to help determine which courts may need
additional judgeships. For example, the Judicial Conference of
the United States uses a weighting system to gauge the workload
burden on Federal district court judges. Cases that would
consume a significant amount of judge-time are assigned larger
weights than cases that generally would consume a small amount
of judge-time. According to the Administrative Office of the
U.S. Courts, this weighting
system ``predict[s] caseload burden more accurately than the
raw number of filings.'' See, ``Case Weights Help Federal
Courts Assess Demands on Judges' Time,'' found at http://
www.uscourts.gov/
newsroom/weights.htm (last visited July 12, 2008). Similarly,
the workload burden of Federal appellate court judges is gauged
using an ``adjusted'' number of filings, which factors in the
relative ease of certain cases and the percentage of cases that
normally would require a merits decision from a judge.
At this point, we simply do not have sufficient data
regarding the workload of the CAVC to conduct that type of
weighting of the Court's caseload. We do not have historical
data as to the percentage of cases decided by judges or about
the time it takes to decide cases of various levels of
complexity. Also, the information that we do have suggests that
the raw volume of cases received at the Court is not a good
indicator of the workload burden on judges. For example, in
fiscal year 2007, the Court received 4,644 new cases and
decided 4,877 cases. The seven active judges decided about 39
percent of those 4,877 cases, recalled retired judges decided
about 6 percent, and the Clerk of the Court resolved 55
percent. This means that, even though the Court received over
660 cases per active judge, the seven judges decided about 270
cases each--less than half of the number that the Court
received.
In view of this lack of data about the Court's workload,
the Disabled American Veterans testified last year that,
``[u]ntil this information is made available to Congress, it is
* * * premature to expand the number of judges to nine.'' S.
Hrg. 110-360, at 44 (2007). I agree that we need additional
information about the Court's workload, about who is doing the
work, and about where there are bottlenecks. Then we could
determine what measures--such as increasing the Court's Public
Office, expanding the Central Legal Staff, authorizing
magistrates, or adding judges--would be the most effective in
helping the Court provide timely decisions to veterans. In sum,
although I am committed to making sure the Court has adequate
resources, my preference would be to follow a more deliberate,
searching approach in assessing whether to expand the size of
the Court.
II. Temporary vs. Permanent Increase
In addition to concerns about the lack of data on the
Court's workload, it appears to me that we do not have
sufficient information at this time to determine whether a
permanent increase in the size of the Court is warranted. Over
the years, the incoming caseload at the Court has varied
significantly, ranging from less than 1,200 new cases to more
than 4,600 new cases. Although the number of incoming cases
reached a record high in fiscal year 2007, the Court is now on
pace to receive about 700 fewer cases during fiscal year 2008.
Also, it is worth mentioning that in 1996 the Court requested
that Congress reduce the size of the Court from seven judges to
five judges, reasoning that ``[i]t does not appear that there
will be any reasonably foreseeable surge in the number of
appeals filed in the Court.'' S. Hrg. 104-722, at 178 (1996).
Yet, the following year the Court experienced a 38 percent
increase in incoming cases.
To me, this volatility in the Court's caseload would weigh
in favor of a temporary, rather than permanent, increase in the
size of the Court at this point. In fact, for other Federal
courts, the Judicial Conference of the United States
``recommends temporary judgeships in all situations where the
caseload level justifying additional judgeships occurred only
in the most recent years.'' H. Hrg. 108-30, at 18 (2003). In
addition, the CAVC itself has recognized that it may not be
necessary for the Court to have nine judges in future years. As
the Chief Judge stated in the Court's September 2007
legislative proposal, ``Congress could reexamine the need for
nine judges when the 13-year terms of Judges Kasold and Hagel
expire in 2016.''
Perhaps more importantly, a temporary increase would
provide Congress with an opportunity to monitor the Court's
progress with additional judges and gather more information
about the Court's workload before deciding whether a permanent
expansion is the best way to make sure veterans receive timely
decisions. To me, a temporary expansion of the Court would
appear to be a more reasonable approach for this Committee
given the information we have at this time.
III. Staggered Terms
As a final matter, I want to discuss another important
issue facing the Court--the prospect of having multiple
judicial vacancies when the current judges retire. By way of
background, when the CAVC was created in 1988, the 15-year
terms of the original judges were not staggered, which led to
six judges retiring between 2000 and 2005. This left the Court
without a full complement of judges for much of that period,
which, in turn, contributed to a disruption in service to
veterans. In total, the Court received over 1,800 more cases
than it decided from 2000 to 2005, and the number of cases
pending at the Court grew from almost 2,300 in 1999 to over
4,600 in 2005.
Now, it is possible that this second generation of judges
will also retire in a cluster. The terms of six judges will
expire between 2016 and 2019, with four terms expiring in a
two-week period in 2019. In fact, in the September 2007
legislative proposal, the Court pointed to this possibility of
en masse retirements as another reason for expanding the Court.
According to the Chief Judge, ``[c]reating two new vacancies in
FY 2008-09 would avoid a significant number of simultaneous
vacancies followed by a period of time when a majority of the
judges would be new and unseasoned at the same time.''
However, the addition of judgeships would only help
alleviate the impact of multiple retirements if the new judges
serve beyond 2019. Yet, under current law, judges who have
served at least 10 years may retire before the expiration of
their 15-year term when their age plus years of service on the
bench equals 80--a provision known as the ``Rule of 80.'' That
means a judge confirmed next year could potentially be eligible
to retire in 2019--the same year that the terms of four
existing judges will expire.
In summary, we would simply be repeating past mistakes if
we add two more judges to the Court in the next year and allow
them to retire under the Rule of 80. That is why I filed an
amendment at the Committee markup to require that any judge
confirmed to fill the two new judgeships must serve out the
full balance of the 15-year term before retiring and receiving
100 percent of their salary--currently $169,000--for the rest
of their lives. That would help ensure that the new judges will
serve well beyond the retirement dates of the existing judges
and hopefully ensure the Court consistently has the judicial
resources necessary to provide timely service to our nation's
veterans.
In my view, if Congress simply expands the size of the
Court without addressing this ongoing problem of en masse
retirements by planning ahead, our veterans will,
unfortunately, pay the price with a disruption in service. I
hope that, before Congress moves forward with any expansion in
the size of the Court, measures will be taken to address this
very real problem that is confronting veterans who are seeking
justice from the Court.
IV. Committee Report
As a final matter, I find it necessary to express
reservations about the methodologies used for some portions of
this report. A Committee report serves as a key source of
legislative history. It preserves the Committee's assessment of
the laws and circumstances that exist today, how the Committee
bill would change the law, and more importantly why the
Committee has determined that changes are necessary. A
Committee report will be relied upon for many years to come by
legislators, judges, historians, and other practitioners
seeking to gain insight into the actions and intentions of this
Committee. That is why I believe it is our responsibility as a
Committee to ensure that the information contained in each
Committee report is held to the highest standards of quality,
reliability, and accuracy befitting this historical document.
Unfortunately, this Committee report--principally the
material in the discussion of section 101--contains numerous
conclusions that were reached by a single member of the
Chairman's Committee staff after she reviewed claims files at
several VA offices. Although I have no reason to doubt the
intentions of the Chairman's staff, I would suggest that the
views of a single staff member should not be included in this
report until they have been verified.
For the Committee to determine whether this information is
reliable, we would--at a minimum--need information about the
methodology used in conducting these reviews, such as the
standards used to determine whether errors were committed, the
method used to choose the case files that were reviewed, and
the reviewer's training in auditing. In the absence of that
basic information, there is simply no means to gauge the
accuracy or reliability of the opinions expressed in that
section of the report.
This is not meant to suggest that oversight work performed
by staff members is unimportant. To the contrary, it plays a
key role in helping identify problems and trends that should be
examined by the entire Committee. It may also reveal the need
to engage independent entities--such as the Government
Accountability Office or VA's Office of Inspector General--to
thoroughly and rigorously review specific benefits or services
provided by VA. Those entities conduct their studies in
accordance with generally accepted government auditing
standards, which helps ensure that their findings are
objective, independent, fact-based, and nonpartisan.
That type of exacting standard should be expected of work
that will be relied upon by Congressional Committees in
performing their legislative functions. That caliber of work
also provides the type of objective, factual, and verifiable
information that is appropriate for a Committee report.
* * * * * * *
Changes in Existing Law
In compliance with paragraph 12 of Rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman).
TITLE 31. MONEY AND FINANCE
* * * * * * *
SUBTITLE III. FINANCIAL MANAGEMENT
* * * * * * *
CHAPTER 37. CLAIMS
* * * * * * *
Subchapter II. Claims of The United States Government
* * * * * * *
SEC. 3711. COLLECTION AND COMPROMISE
* * * * * * *
(f)(1) * * *
* * * * * * *
(3) The Secretary of Veterans Affairs may suspend or
terminate an action by the Secretary under subsection (a) to
collect a claim against the estate of a person who died while
serving on active duty as a member of the Army, Navy, Air
Force, Marine Corps, or Coast Guard during a period when the
Coast Guard is operating as a service in the Navy if the
Secretary determines that, under the circumstances applicable
with respect to the deceased person, it is appropriate to do
so.
(4) [(3)] * * *
* * * * * * *
TITLE 38. VETERANS' BENEFITS
PART I. GENERAL PROVISIONS
CHAPTER 1. GENERAL
SEC. 101. DEFINITIONS
* * * * * * *
(4)(A) The term ``child'' means (except for purposes of
chapter 19 of this title (other than with respect to a child
who is an insurable dependent under [section 1965(10)(B)]
subparagraph (B) or (C) of section 1965(10) of such chapter)
and section 8502(b) of this title) a person who is unmarried
and--
* * * * * * *
CHAPTER 5. AUTHORITY AND DUTIES OF
THE SECRETARY
Subchapter I. General Authorities
* * * * * * *
SEC. 502. JUDICIAL REVIEW OF RULES AND REGULATIONS
An action of the Secretary to which section 552(a)(1) or
553 of title 5 (or both) refers [(other than an action relating
to the adoption or revision of the schedule of ratings for
disabilities adopted under section 1155 of this title)] is
subject to judicial review. Such review shall be in accordance
with chapter 7 of title 5 and may be sought only in the United
States Court of Appeals for the Federal Circuit. However, if
such review is sought in connection with an appeal brought
under the provisions of chapter 72 of this title, the
provisions of that chapter shall apply rather than the
provisions of chapter 7 of title 5.
* * * * * * *
PART II. GENERAL BENEFITS
* * * * * * *
CHAPTER 19. INSURANCE
* * * * * * *
Subchapter III. Servicemembers' Group Life Insurance
SEC. 1965. DEFINITIONS
* * * * * * *
(10) The term ``insurable dependent'', with respect
to a member, means the following:
(A) The member's spouse.
(B) The member's child, as defined in the
first sentence of section 101(4)(A) of this
title.
(C) The member's stillborn child.
* * * * * * *
SEC. 1967. PERSONS INSURED; AMOUNT
(a)(1) * * *
(A) * * *
* * * * * * *
(C) In the case of any member of the Ready Reserve of
a uniformed service who meets the qualifications set
forth in [section 1965(5)(B) of this title]
subparagraph (B) or (C) of section 1965(5) of this
title--
* * * * * * *
(5) * * *
(A) * * *
* * * * * * *
(C) The first day a member of the Ready Reserve meets
the qualifications set forth in [section 1965(5)(B) of
this title] subparagraph (B) or (C) of section 1965(5)
of this title.
* * * * * * *
SEC. 1968. DURATION AND TERMINATION OF COVERAGE; CONVERSION
(a) * * *
* * * * * * *
(5) With respect to an insurable dependent of the
member, insurance under this subchapter shall cease--
(A) 120 days after the date of an election
made in writing by the member to terminate the
coverage; or
(B) on the earliest of--
(i) 120 days after the date of the
member's death;
(ii) [120 days after] the date of
termination of the insurance on the
member's life under this subchapter; or
(iii) 120 days after the termination
of the dependent's status as an
insurable dependent of the member.
* * * * * * *
SEC. 1969. DEDUCTIONS; PAYMENT; INVESTMENT; EXPENSES
* * * * * * *
(g)(1)(A) * * *
(B) During any month in which a member is assigned to the
Ready Reserve of a uniformed service under conditions which
meet the qualifications set forth in [section 1965(5)(B) of
this title] subparagraph (B) or (C) of section 1965(5) of this
title and the spouse of the member is insured under a policy of
insurance purchased by the Secretary under section 1966 of this
title, there shall be contributed from the appropriation made
for active duty pay of the uniformed service concerned an
amount determined by the Secretary [(which shall be the same
for all such members)] as the share of the cost attributable to
insuring the spouse of such member under this policy, less any
costs traceable to the extra hazards of such duty in the
uniformed services. Any amounts so contributed on behalf of any
individual shall be collected by the Secretary concerned from
such individual (by deduction from pay or otherwise) and shall
be credited to the appropriation from which such contribution
was made.
* * * * * * *
SEC. 1973. FORFEITURE
Any person guilty of mutiny, treason, spying, or desertion,
or who, because of conscientious objections, refuses to perform
service in the Armed Forces of the United States or refuses to
wear the uniform of such force, shall forfeit all rights to
Servicemembers' Group Life Insurance [under this subchapter]
and Veterans' Group Life Insurance under this subchapter. No
such insurance shall be payable for death inflicted as a lawful
punishment for crime or for military or naval offense, except
when inflicted by an enemy of the United States.
* * * * * * *
CHAPTER 23. BURIAL BENEFITS
* * * * * * *
SEC. 2306. HEADSTONES, MARKERS, AND BURIAL RECEPTACLES
* * * * * * *
(b)(1) * * *
* * * * * * *
(4) For purposes of this subsection:
(A) The term ``veteran'' includes an individual who
dies in the active military, naval, or air service.
(B) The term ``surviving spouse'' includes [an
unremarried surviving spouse whose subsequent
remarriage was terminated by death or divorce] a
surviving spouse who had a subsequent remarriage.
* * * * * * *
PART III. READJUSTMENT AND
RELATED BENEFITS
* * * * * * *
CHAPTER 31. TRAINING AND REHABILITATION FOR VETERANS WITH SERVICE-
CONNECTED DISABILITIES
* * * * * * *
SEC. 3105. DURATION OF REHABILITATION PROGRAMS
* * * * * * *
(d) [Unless the Secretary determines that a longer period
is necessary and likely to result in a substantial increase in
a veteran's level of independence in daily living, the period
of a program] (1) Except as provided in paragraph (2), the
period of a program of independent living services and
assistance for a veteran under this chapter (following a
determination by the Secretary that such veteran's disability
or disabilities are so severe that the achievement of a
vocational goal currently is not reasonably feasible) may not
exceed twenty-four months.
(2)(A) The period of a program of independent living
services and assistance for a veteran under this chapter may
exceed twenty-four months as follows:
(i) If the Secretary determines that a longer period
is necessary and likely to result in a substantial
increase in the veteran's level of independence in
daily living.
(ii) If the veteran served on active duty during the
Post-9/11 Global Operations period and has a severe
disability (as determined by the Secretary for purposes
of this clause) incurred or aggravated in such service.
(B) In this paragraph, the term ``Post-9/11 Global
Operations period'' means the period of the Persian Gulf War
beginning on September 11, 2001, and ending on the date
thereafter prescribed by Presidential proclamation or by law.
* * * * * * *
CHAPTER 35. SURVIVORS' AND DEPENDENTS' EDUCATIONAL ASSISTANCE
* * * * * * *
Subchapter II. Eligibility and Entitlement
* * * * * * *
SEC. 3512. PERIODS OF ELIGIBILITY
* * * * * * *
(b)(1)(A) Except as provided in [subparagraph (B) or (C)]
subparagraphs (B), (C), or (D), a person made eligible by
subparagraph (B) or (D) of section 3501(a)(1) of this title or
a person made eligible by the disability of a spouse under
section 3501(a)(1)(E) of this title may be afforded educational
assistance under this chapter during the 10-year period
beginning on the date (as determined by the Secretary) the
person becomes an eligible person within the meaning of section
3501(a)(1)(B), 3501(a)(1)(D)(i), 3501(a)(1)(D)(ii), or
3501(a)(1)(E) of this title. In the case of a surviving spouse
made eligible by clause (ii) of section 3501(a)(1)(D) of this
title, the 10-year period may not be reduced by any earlier
period during which the person was eligible for educational
assistance under this chapter as a spouse made eligible by
clause (i) of that section.
* * * * * * *
(D) Notwithstanding subparagraph (A), an eligible person
referred to in that subparagraph who is made eligible under
section 3501(a)(1)(D)(i) of this title by reason of a service-
connected disability that was determined to be a total
disability permanent in nature not later than three years after
discharge from service may be afforded educational assistance
under this chapter during the 20-year period beginning on the
date the disability was so determined to be a total disability
permanent in nature, but only if the eligible person remains
the spouse of the disabled person throughout the period.
* * * * * * *
CHAPTER 36. ADMINISTRATION OF
EDUCATIONAL BENEFITS
Subchapter I. State Approving Agencies
* * * * * * *
SEC. 3676. APPROVAL OF NONACCREDITED COURSES
* * * * * * *
(c) * * *
* * * * * * *
(4) The institution maintains a written record of the
previous education and training of the eligible person
and clearly indicates that appropriate credit has been
given by the institution for previous education and
training, with the training period shortened
proportionately and the eligible person [and the
Secretary] so notified.
* * * * * * *
SEC. 3677. APPROVAL OF TRAINING ON THE JOB
* * * * * * *
(b)(1) * * *
* * * * * * *
(3) The requirement for certification under paragraph (1)
shall not apply to training described in section 3452(e)(2) of
this title.
* * * * * * *
Subchapter II. Miscellaneous Provisions
* * * * * * *
SEC. 3686. CORRESPONDENCE COURSES
* * * * * * *
(b) The enrollment agreement shall fully disclose the
obligation of both the institution and the veteran or spouse or
surviving spouse and shall prominently display the provisions
for affirmance, termination, refunds, and the conditions under
which payment of the allowance is made by the Secretary to the
veteran or spouse or surviving spouse. A copy of the enrollment
agreement shall be furnished to each such veteran or spouse or
surviving spouse at the time such veteran or spouse or
surviving spouse signs such agreement. No such agreement shall
be effective unless such veteran or spouse or surviving spouse
shall, after the expiration of [ten] five days after the
enrollment agreement is signed, have signed and submitted to
the Secretary a written statement, with a signed copy to the
institution, specifically affirming the enrollment agreement.
In the event the veteran or spouse or surviving spouse at any
time notifies the institution of such veteran's or spouse's
intention not to affirm the agreement in accordance with the
preceding sentence, the institution, without imposing any
penalty or charging any fee shall promptly make a full refund
of all amounts paid.
* * * * * * *
SEC. 3691. CHANGE OF PROGRAM
* * * * * * *
(d) (1) For the purposes of this section, the term ``change
of program of education'' shall not be deemed to include a
change by a veteran or eligible person from the pursuit of one
program to the pursuit of another program if--
[(1)] (A) the veteran or eligible person has
successfully completed the former program;
[(2)] (B) the program leads to a vocational,
educational, or professional objective in the same
general field as the former program;
[(3)] (C) the former program is a prerequisite to, or
generally required for, pursuit of the subsequent
program; [or]
[(4)] (D) in the case of a change from the pursuit of
a subsequent program to the pursuit of a former
program, the veteran or eligible person resumes pursuit
of the former program without loss of credit or
standing in the former program[.] ; or
(E) the change from the program to another program is
at the same educational institution and such
educational institution determines that the new program
is suitable to the aptitudes, interests, and abilities
of the veteran or eligible person and certifies to the
Secretary the enrollment of the veteran or eligible
person in the new program.
(2) A veteran or eligible person undergoing a change from
one program of education to another program of education as
described in paragraph (1)(E) shall not be required to apply to
the Secretary for approval of such change.
* * * * * * *
CHAPTER 37. HOUSING AND SMALL BUSINESS LOANS
Subchapter I. General
* * * * * * *
SEC. 3703. BASIC PROVISIONS RELATING TO LOAN GUARANTY AND
INSURANCE
(a)(1)(A) * * *
(i)(I) * * *
* * * * * * *
(IV) in the case of any loan of more than $144,000
for a purpose specified in clause (1), (2), (3), (5),
(6), or (8) of section 3710(a) of this title, the
lesser of the maximum guaranty amount (as defined in
subparagraph (C)) or 25 percent of the loan; or
* * * * * * *
SEC. 3707. ADJUSTABLE RATE MORTGAGES
(a) The Secretary shall carry out a demonstration project
under this section [during fiscal years 1993 through 2008]
during the period beginning with the beginning of fiscal year
1993 and ending at the end of fiscal year 2012 for the purpose
of guaranteeing loans in a manner similar to the manner in
which the Secretary of Housing and Urban Development insures
adjustable rate mortgages under section 251 of the National
Housing Act.
* * * * * * *
SEC. 3707A. HYBRID ADJUSTABLE RATE MORTGAGES
(a) The Secretary shall carry out a demonstration project
under this section during fiscal years 2004 [through 2008]
through 2012 for the purpose of guaranteeing loans in a manner
similar to the manner in which the Secretary of Housing and
Urban Development insures adjustable rate mortgages under
section 251 of the National Housing Act in accordance with the
provisions of this section with respect to hybrid adjustable
rate mortgages described in subsection (b).
* * * * * * *
Subchapter II. Loans
SEC. 3710. PURCHASE OR CONSTRUCTION OF HOMES
* * * * * * *
(b) * * *
* * * * * * *
(8) in the case of a loan to refinance a loan (other
than a loan or installment sales contract described in
clause (7) of this subsection or a loan made for a
purpose specified in subsection (a)(8) of this
section), the amount of the loan to be guaranteed or
made does not exceed [90 percent] 95 percent of the
reasonable value of the dwelling or farm residence
securing the loan, as determined pursuant to section
3731 of this title.
* * * * * * *
CHAPTER 43. EMPLOYMENT AND REEMPLOYMENT RIGHTS OF MEMBERS OF THE
UNIFORMED SERVICES
* * * * * * *
SUBCHAPTER III. PROCEDURES FOR ASSISTANCE, ENFORCEMENT, AND
INVESTIGATION
* * * * * * *
SEC.
4326. CONDUCT OF INVESTIGATION; SUBPOENAS.
4327. NONCOMPLIANCE OF FEDERAL OFFICIALS WITH DEADLINES;
INAPPLICABILITY OF STATUTES OF LIMITATIONS.
* * * * * * *
SUBCHAPTER IV. MISCELLANEOUS PROVISIONS
* * * * * * *
4334. NOTICE OF RIGHTS AND DUTIES.
4335. TRAINING FOR FEDERAL EXECUTIVE AGENCY HUMAN RESOURCES PERSONNEL
ON EMPLOYMENT AND REEMPLOYMENT RIGHTS AND
LIMITATIONS.
* * * * * * *
Subchapter III. Procedures for Assistance, Enforcement, and
Investigation
* * * * * * *
SEC. 4322. ENFORCEMENT OF EMPLOYMENT OR REEMPLOYMENT RIGHTS
* * * * * * *
[(c) The Secretary shall, upon request, provide technical
assistance to a potential claimant with respect to a complaint
under this subsection, and when appropriate, to such claimant's
employer.]
(c)(1) Not later than five days after the Secretary
receives a complaint submitted by a person under subsection
(a), the Secretary shall notify such person in writing of his
or her rights with respect to such complaint under this section
and section 4323 or 4324, as the case may be.
(2) The Secretary shall, upon request, provide technical
assistance to a potential claimant with respect to a complaint
under this subsection, and when appropriate, to such claimant's
employer.
* * * * * * *
(e) If the efforts of the Secretary with respect to any
complaint filed under subsection (a) do not resolve the
complaint, the Secretary shall notify the person who submitted
the complaint in writing of--
* * * * * * *
(f) Any action required by subsections (d) and (e) with
respect to a complaint submitted by a person to the Secretary
under subsection (a) shall be completed by the Secretary not
later than 90 days after receipt of such complaint.
(g) [(f)] This subchapter does not apply to any action
relating to benefits to be provided under the Thrift Savings
Plan under title 5.
SEC. 4323. ENFORCEMENT OF RIGHTS WITH RESPECT TO A STATE OR PRIVATE
EMPLOYER
(a) Action for relief.--
(1) A person who receives from the Secretary a
notification pursuant to section 4322(e) of this title
of an unsuccessful effort to resolve a complaint
relating to a State (as an employer) or a private
employer may request that the Secretary refer the
complaint to the Attorney General. Not later than 60
days after the Secretary receives such a request with
respect to a complaint, the Secretary shall refer the
complaint to the Attorney General. If the Attorney
General is reasonably satisfied that the person on
whose behalf the complaint is referred is entitled to
the rights or benefits sought, the Attorney General may
appear on behalf of, and act as attorney for, the
person on whose behalf the complaint is submitted and
commence an action for relief under this chapter for
such person. In the case of such an action against a
State (as an employer), the action shall be brought in
the name of the United States as the plaintiff in the
action.
(2) Not later than 60 days after the date the
Attorney General receives a referral under paragraph
(1), the Attorney General shall--
(A) make a decision whether to appear on
behalf of, and act as attorney for, the person
on whose behalf the complaint is submitted; and
(B) notify such person in writing of such
decision.
(3) [(2)] A person may commence an action for relief
with respect to a complaint against a State (as an
employer) or a private employer if the person--
* * * * * * *
[(i) Inapplicability of State statute of limitations.--No
State statute of limitations shall apply to any proceeding
under this chapter.]
(i) [(j)] Definition.--In this section, the term ``private
employer'' includes a political subdivision of a State.
SEC. 4324. ENFORCEMENT OF RIGHTS WITH RESPECT TO FEDERAL EXECUTIVE
AGENCIES
(a)(1) A person who receives from the Secretary a
notification pursuant to section 4322(e) may request that the
Secretary refer the complaint for litigation before the Merit
Systems Protection Board. [The Secretary shall refer] Not later
than 60 days after the date the Secretary receives such a
request, the Secretary shall refer the complaint to the Office
of Special Counsel established by section 1211 of title 5.
(2)(A) * * *
(B) [If the Special Counsel declines to initiate an action
and represent a person before the Merit Systems Protection
Board under subparagraph (A), the Special Counsel shall notify
such person of that decision.] Not later than 60 days after the
date the Special Counsel receives a referral under paragraph
(1), the Special Counsel shall--
(i) make a decision whether to represent a person
before the Merit Systems Protection Board under
subparagraph (A); and
(ii) notify such person in writing of such decision.
* * * * * * *
SEC. 4327. NONCOMPLIANCE OF FEDERAL OFFICIALS WITH DEADLINES;
INAPPLICABILITY OF STATUTES OF LIMITATIONS
(a) Effect of Noncompliance of Federal Officials With
Deadlines.--(1) The inability of the Secretary, the Attorney
General, or the Special Counsel to comply with a deadline
applicable to such official under section 4322, 4323, or 4324
of this title--
(A) shall not affect the authority of the Attorney
General or the Special Counsel to represent and file an
action or submit a complaint on behalf of a person
under section 4323 or 4324 of this title;
(B) shall not affect the right of a person--
(i) to commence an action under section 4323
of this title;
(ii) to submit a complaint under section 4324
of this title; or
(iii) to obtain any type of assistance or
relief authorized by this chapter;
(C) shall not deprive a Federal court, the Merit
Systems Protection Board, or a State court of
jurisdiction over an action or complaint filed by the
Attorney General, the Special Counsel, or a person
under section 4323 or 4324 of this title; and
(D) shall not constitute a defense, including a
statute of limitations period, that any employer
(including a State, a private employer, or a Federal
executive agency) or the Office of Personnel Management
may raise in an action filed by the Attorney General,
the Special Counsel, or a person under section 4323 or
4324 of this title.
(2) If the Secretary, the Attorney General, or the Special
Counsel is unable to meet a deadline applicable to such
official in section 4322(f), 4323(a)(1), 4323(a)(2),
4324(a)(1), or 4324(a)(2)(B) of this title, and the person
agrees to an extension of time, the Secretary, the Attorney
General, or the Special Counsel, as the case may be, shall
complete the required action within the additional period of
time agreed to by the person.
(b) Inapplicability of Statutes of Limitations.--If any
person seeks to file a complaint or claim with the Secretary,
the Merit Systems Protection Board, or a Federal or State court
under this chapter alleging a violation of this chapter, there
shall be no limit on the period for filing the complaint or
claim.
Subchapter IV. Miscellaneous Provisions
* * * * * * *
SEC. 4332. REPORTS
(a) Annual Report by Secretary._The Secretary shall [The
Secretary shall], after consultation with the Attorney General
and the Special Counsel referred to in section 4324(a)(1) [and
no later than February 1, 2005, and annually thereafter,
transmit to the Congress, a report containing the following
matters for the fiscal year ending before such February 1:] ,
transmit to Congress not later than July 1 each year a report
on matters for the fiscal year ending in the year before the
year in which such report is transmitted as follows:
(1) * * *
(2) * * *
(3) The number of cases referred to the Attorney
General or the Special Counsel pursuant to section 4323
or 4324, respectively, during such fiscal year and the
number of actions initiated by the Office of Special
Counsel before the Merit Systems Protection Board
pursuant to section 4324 during such fiscal year.
(4) * * *
(5) The number of cases reviewed by the Secretary and
the Secretary of Defense through the National Committee
for Employer Support of the Guard and Reserve of the
Department of Defense that involve the same person.
(6) With respect to the cases reported on pursuant to
paragraphs (1), (2), (3), (4), and (5)--
(A) the number of such cases that involve a
disability-related issue; and
(B) the number of such cases that involve a
person who has a service-connected disability.
(7) [(5)] The nature and status of each case reported
on pursuant to paragraph (1), (2), (3), [or (4)] (4),
or (5).
(8) With respect to the cases reported on pursuant to
paragraphs (1), (2), (3), (4), and (5) the number of
such cases that involve persons with different
occupations or persons seeking different occupations,
as designated by the Standard Occupational
Classification System.
(9) [(6)] An indication of whether there are any
apparent patterns of violation of the provisions of
this chapter, together with an explanation thereof.
(10) [(7)] Recommendations for administrative or
legislative action that the Secretary, the Attorney
General, or the Special Counsel considers necessary for
the effective implementation of this chapter, including
any action that could be taken to encourage mediation,
before claims are filed under this chapter, between
employers and persons seeking employment or
reemployment.
(b) Quarterly Reports.--
(1) Quarterly report by secretary.--Not later than 30
days after the end of each fiscal quarter, the
Secretary shall submit to Congress, the Secretary of
Defense, the Attorney General, and the Special Counsel
a report setting forth, for the previous full quarter,
the following:
(A) The number of cases for which the
Secretary did not meet the requirements of
section 4322(f) of this title.
(B) The number of cases for which the
Secretary received a request for a referral
under paragraph (1) of section 4323(a) of this
title but did not make such referral within the
time period required by such paragraph.
(2) Quarterly report by attorney general.--Not later
than 30 days after the end of each fiscal quarter, the
Attorney General shall submit to Congress, the
Secretary, the Secretary of Defense, and the Special
Counsel a report setting forth, for the previous full
quarter, the number of cases for which the Attorney
General received a referral under paragraph (1) of
section 4323(a) of this title but did not meet the
requirements of paragraph (2) of section 4323(a) of
this title for such referral.
(3) Quarterly report by special counsel.--Not later
than 30 days after the end of each fiscal quarter, the
Special Counsel shall submit to Congress, the
Secretary, the Secretary of Defense, and the Attorney
General a report setting forth, for the previous full
quarter, the number of cases for which the Special
Counsel received a referral under paragraph (1) of
section 4324(a) of this title but did not meet the
requirements of paragraph (2)(B) of section 4324(a) of
this title for such referral.
(c) Uniform Categorization of Data.--The Secretary shall
coordinate with the Secretary of Defense, the Attorney General,
and the Special Counsel to ensure that--
(1) the information in the reports required by this
section is categorized in a uniform way; and
(2) the Secretary, the Secretary of Defense, the
Attorney General, and the Special Counsel each have
electronic access to the case files reviewed under this
chapter by the Secretary, the Secretary of Defense, the
Attorney General, and the Special Counsel with due
regard for the provisions of section 552a of title 5.
* * * * * * *
SEC. 4335. TRAINING FOR FEDERAL EXECUTIVE AGENCY HUMAN RESOURCES
PERSONNEL ON EMPLOYMENT AND REEMPLOYMENT RIGHTS AND
LIMITATIONS
(a) Training Required.--The head of each Federal executive
agency shall provide training for the human resources personnel
of such agency on the following:
(1) The rights, benefits, and obligations of members
of the uniformed services under this chapter.
(2) The application and administration of the
requirements of this chapter by such agency with
respect to such members.
(b) Consultation.--The training provided under subsection
(a) shall be developed and provided in consultation with the
Director of the Office of Personnel Management.
(c) Frequency.--The training under subsection (a) shall be
provided with such frequency as the Director of the Office of
Personnel Management shall specify in order to ensure that the
human resources personnel of Federal executive agencies are
kept fully and currently informed of the matters covered by the
training.
(d) Human Resources Personnel Defined.--In this section,
the term ``human resources personnel'', in the case of a
Federal executive agency, means any personnel of the agency who
are authorized to recommend, take, or approve any personnel
action that is subject to the requirements of this chapter with
respect to employees of the agency.
* * * * * * *
PART IV. GENERAL ADMINISTRATIVE PROVISIONS
CHAPTER 51. CLAIMS, EFFECTIVE DATES, AND PAYMENTS
Subchapter I. Claims
* * * * * * *
SEC. 5103. NOTICE TO CLAIMANTS OF REQUIRED INFORMATION AND EVIDENCE
(a) Required information and evidence.--(1) Upon receipt of
a complete or substantially complete application, the Secretary
shall notify the claimant and the claimant's representative, if
any, of any information, and any medical or lay evidence, not
previously provided to the Secretary that is necessary to
substantiate the claim. As part of that notice, the Secretary
shall indicate which portion of that information and evidence,
if any, is to be provided by the claimant and which portion, if
any, the Secretary, in accordance with section 5103A of this
title and any other applicable provisions of law, will attempt
to obtain on behalf of the claimant.
(2)(A) The Secretary shall prescribe in regulations
requirements relating to the contents of notice to be provided
under this subsection.
(B) The regulations required by this paragraph--
(i) shall specify different contents for notice
depending on whether the claim concerned is an original
claim, a claim for reopening a prior decision on a
claim, or a claim for increase in benefits;
(ii) may provide additional or alternative contents
for notice if appropriate to the benefit or services
sought under the claim;
(iii) shall specify for each type of claim for
benefits the general information and evidence required
to substantiate the basic elements of such type of
claim; and
(iv) shall specify the time period limitations
required pursuant to subsection (b).
* * * * * * *
CHAPTER 53. SPECIAL PROVISIONS RELATING TO BENEFITS
* * * * * * *
SEC. 5312. ANNUAL ADJUSTMENT OF CERTAIN BENEFIT RATES
* * * * * * *
(d)(1) Whenever there is an increase in benefit amounts
payable under title II of the Social Security Act (42 U.S.C.
401 et seq.) as a result of a determination made under section
215(i) of such Act (42 U.S.C. 415(i)), the Secretary shall,
effective on the date of such increase in benefit amounts,
increase the dollar amounts in effect for the payment of
disability compensation and dependency and indemnity
compensation by the Secretary, as specified in paragraph (2),
as such amounts were in effect immediately prior to the date of
such increase in benefit amounts payable under title II of the
Social Security Act, by the same percentage as the percentage
by which such benefit amounts are increased.
(2) The dollar amounts to be increased pursuant to
paragraph (1) are the following:
(A) Compensation.--Each of the dollar amounts in
effect under section 1114 of this title.
(B) Additional compensation for dependents.--Each of
the dollar amounts in effect under section 1115(1) of
this title.
(C) Clothing allowance.--The dollar amount in effect
under section 1162 of this title.
(D) New dic rates.--Each of the dollar amounts in
effect under paragraphs (1) and (2) of section 1311(a)
of this title.
(E) Old dic rates.--Each of the dollar amounts in
effect under section 1311(a)(3) of this title.
(F) Additional dic for surviving spouses with minor
children.--The dollar amount in effect under section
1311(b) of this title.
(G) Additional dic for disability.--Each of the
dollar amounts in effect under sections 1311(c) and
1311(d) of this title.
(H) Dic for dependent children.--Each of the dollar
amounts in effect under sections 1313(a) and 1314 of
this title.
(3) Whenever there is an increase under paragraph (1) in
amounts in effect for the payment of disability compensation
and dependency and indemnity compensation, the Secretary shall
publish such amounts, as increased pursuant to such paragraph,
in the Federal Register at the same time as the material
required by section 215(i)(2)(D) of the Social Security Act (42
U.S.C. 415(i)(2)(D)) is published by reason of a determination
under section 215(i) of such Act (42 U.S.C. 415(i)).
* * * * * * *
SEC. 5317. USE OF INCOME INFORMATION FROM OTHER AGENCIES: NOTICE AND
VERIFICATION
* * * * * * *
(g) The authority of the Secretary to obtain information
from the Secretary of the Treasury or the Commissioner of
Social Security under section 6103(1)(7)(D)(viii) of the
Internal Revenue Code of 1986 expires on [September 30, 2008]
September 30, 2011.
* * * * * * *
PART V. BOARDS, ADMINISTRATIONS, AND SERVICES
CHAPTER 72. UNITED STATES COURT OF APPEALS FOR VETERANS CLAIMS
* * * * * * *
SUBCHAPTER III. MISCELLANEOUS PROVISIONS
* * * * * * *
SEC.
7287. ADMINISTRATION.
7288. ANNUAL REPORT.
* * * * * * *
Subchapter I. Organization and Jurisdiction
* * * * * * *
SEC. 7253. COMPOSITION
(a) Composition.--The Court of Appeals for Veterans Claims
is composed of at least three and not more than [seven judges]
nine judges, one of whom shall serve as chief judge in
accordance with subsection (d).
* * * * * * *
SEC. 7257. RECALL OF RETIRED JUDGES
(a)(1) A retired judge of the Court may be recalled for
further service on the Court in accordance with this section.
To be eligible to be recalled for such service, a retired judge
must at the time of the judge's retirement provide to the chief
judge of the Court (or, in the case of the chief judge, to the
clerk of the Court) notice in writing that the retired judge is
available for further service on the Court in accordance with
this section and is willing to be recalled under this section.
[Such a notice provided by a retired judge is irrevocable.]
Such a notice provided by a retired judge to whom section
7296(c)(1)(B) of this title applies is irrevocable.
* * * * * * *
(b)(1) * * *
(2) A recall-eligible retired judge may not be recalled for
more than 90 days (or the equivalent) during any calendar year
without the judge's consent [or for more than a total of 180
days (or the equivalent) during any calendar year].
(3) If a recall-eligible retired judge is recalled by the
chief judge in accordance with this section and (other than in
the case of a judge who has previously during that calendar
year served at least 90 days (or the equivalent) of recalled
service on the court) declines (other than by reason of
disability) to perform the service to which recalled, the chief
judge shall remove that retired judge from the status of a
recall-eligible judge. This paragraph shall not apply to a
judge to whom section 7296(c)(1)(A) or 7296(c)(1)(B) of this
title applies and who has, in the aggregate, served at least
five years of recalled service on the Court under this section.
* * * * * * *
[(d)(1) The pay of a recall-eligible retired judge who
retired under section 7296 of this title is specified in
subsection (c) of that section.
[(2) A judge who is recalled under this section who retired
under chapter 83 or 84 of title 5 shall be paid, during the
period for which the judge serves in recall status, pay at the
rate of pay in effect under section 7253(e) of this title for a
judge performing active service, less the amount of the judge's
annuity under the applicable provisions of chapter 83 or 84 of
title 5.]
(d)(1) The pay of a recall-eligible retired judge to whom
section 7296(c)(1)(B) of this title applies is the pay
specified in that section.
(2) A judge who is recalled under this section who retired
under chapter 83 or 84 of title 5 or to whom section
7296(c)(1)(A) of this title applies shall be paid, during the
period for which the judge serves in recall status, pay at the
rate of pay in effect under section 7253(e) of this title for a
judge performing active service, less the amount of the judge's
annuity under the applicable provisions of chapter 83 or 84 of
title 5 or the judge's annuity under section 7296(c)(1)(A) of
this title, whichever is applicable.
* * * * * * *
Subchapter II. Procedure
SEC. 7268. AVAILABILITY OF PROCEEDINGS
* * * * * * *
(c)(1) The Court shall prescribe rules, in accordance with
section 7264(a) of this title, to protect privacy and security
concerns relating to all filing of documents and the public
availability under this subsection of documents retained by the
Court or filed electronically with the Court.
(2) The rules prescribed under paragraph (1) shall be
consistent to the extent practicable with rules addressing
privacy and security issues throughout the Federal courts.
(3) The rules prescribed under paragraph (1) shall take
into consideration best practices in Federal and State courts
to protect private information or otherwise maintain necessary
information security.
* * * * * * *
Subchapter III. Miscellaneous Provisions
* * * * * * *
SEC. 7288. ANNUAL REPORT
(a) In General.--The chief judge of the Court shall submit
to the appropriate committees of Congress each year a report
summarizing the workload of the Court for the fiscal year
ending during the preceding year.
(b) Elements.--Each report under subsection (a) shall
include, with respect to the fiscal year covered by such
report, the following information:
(1) The number of appeals filed with the Court.
(2) The number of petitions filed with the Court.
(3) The number of applications filed with the Court
under section 2412 of title 28.
(4) The total number of dispositions by each of the
following:
(A) The Court as a whole.
(B) The Clerk of the Court.
(C) A single judge of the Court.
(D) A multi-judge panel of the Court.
(E) The full Court.
(5) The number of each type of disposition by the
Court, including settlement, affirmation, remand,
vacation, dismissal, reversal, grant, and denial.
(6) The median time from filing an appeal to
disposition by each of the following:
(A) The Court as a whole.
(B) The Clerk of the Court.
(C) A single judge of the Court.
(D) Multiple judges of the Court (including a
multi-judge panel of the Court or the full
Court).
(7) The median time from filing a petition to
disposition by the Court.
(8) The median time from filing an application under
section 2412 of title 28 to disposition by the Court.
(9) The median time from the completion of briefing
requirements by the parties to disposition by the
Court.
(10) The number of oral arguments before the Court.
(11) The number of cases appealed to the United
States Court of Appeals for the Federal Circuit.
(12) The number and status of appeals and petitions
pending with the Court and of applications described in
paragraph (3) as of the end of such fiscal year.
(13) The number of cases pending with the Court more
than 18 months as of the end of such fiscal year.
(14) A summary of any service performed for the Court
by a recalled retired judge of the Court.
(c) Appropriate Committees of Congress Defined.--In this
section, the term ``appropriate committees of Congress''
means--
(1) the Committee on Veterans' Affairs of the Senate;
and
(2) the Committee on Veterans' Affairs of the House
of Representatives.
* * * * * * *
Subchapter V. Retirement and Survivors Annuities
SEC. 7296. RETIREMENT OF JUDGES
* * * * * * *
(c)[(1) An individual who retires under subsection (b) of
this section and elects under subsection (d) of this section to
receive retired pay under this subsection shall (except as
provided in paragraph (2) of this subsection) receive retired
pay as follows:
[(A) In the case of a judge who is a recall-eligible
retired judge under section 7257 of this title or who
was a recall-eligible retired judge under that section
and was removed from recall status under subsection
(b)(4) of that section by reason of disability, the
retired pay of the judge shall be the pay of a judge of
the court.
[(B) In the case of a judge who at the time of
retirement did not provide notice under section 7257 of
this title of availability for service in a recalled
status, the retired pay of the judge shall be the rate
of pay applicable to that judge at the time of
retirement.
[(C) In the case of a judge who was a recall-eligible
retired judge under section 7257 of this title and was
removed from recall status under subsection (b)(3) of
that section, the retired pay of the judge shall be the
pay of the judge at the time of the removal from recall
status.]
(1)(A) A judge who is appointed on or after the date of the
enactment of the Veterans' Benefits Improvement Act of 2008 and
who retires under subsection (b) and elects under subsection
(d) to receive retired pay under this subsection shall (except
as provided in paragraph (2)) receive retired pay as follows:
(i) In the case of a judge who is a recall-eligible
retired judge under section 7257 of this title, the
retired pay of the judge shall (subject to section
7257(d)(2) of this title) be the rate of pay applicable
to that judge at the time of retirement, as adjusted
from time to time under subsection (f)(3).
(ii) In the case of a judge other than a recall-
eligible retired judge, the retired pay of the judge
shall be the rate of pay applicable to that judge at
the time of retirement.
(B) A judge who retired before the date of the enactment of
the Veterans' Benefits Improvement Act of 2008 and elected
under subsection (d) to receive retired pay under this
subsection, or a judge who retires under subsection (b) and
elects under subsection (d) to receive retired pay under this
subsection, shall (except as provided in paragraph (2)) receive
retired pay as follows:
(i) In the case of a judge who is a recall-eligible
retired judge under section 7257 of this title or who
was a recall-eligible retired judge under that section
and was removed from recall status under subsection
(b)(4) of that section by reason of disability, the
retired pay of the judge shall be the pay of a judge of
the court.
(ii) In the case of a judge who at the time of
retirement did not provide notice under section 7257 of
this title of availability for service in a recalled
status, the retired pay of the judge shall be the rate
of pay applicable to that judge at the time of
retirement.
(iii) In the case of a judge who was a recall-
eligible retired judge under section 7257 of this title
and was removed from recall status under subsection
(b)(3) of that section, the retired pay of the judge
shall be the pay of the judge at the time of the
removal from recall status.
* * * * * * *
(f)(1) * * *
* * * * * * *
(3)(A) A cost-of-living adjustment provided by law in
annuities payable under civil service retirement laws shall
apply to retired pay under this section only in the case of
retired pay computed under [paragraph (2) of subsection (c)]
paragraph (1)(A)(i) or (2) of subsection (c).
* * * * * * *
TITLE 50. WAR AND NATIONAL DEFENSE
TITLE 50 APPENDIX--WAR AND NATIONAL DEFENSE
* * * * * * *
Servicemembers Civil Relief Act
* * * * * * *
TITLE VII. FURTHER RELIEF
* * * * * * *
SEC.
596. BUSINESS OR TRADE OBLIGATIONS
707. TUITION, REENROLLMENT, AND STUDENT LOAN RELIEF FOR POSTSECONDARY
STUDENTS CALLED TO MILITARY SERVICE.
* * * * * * *
Title VII. Further Relief
* * * * * * *
SEC. 707. TUITION, REENROLLMENT, AND STUDENT LOAN RELIEF FOR
POSTSECONDARY STUDENTS CALLED TO MILITARY SERVICE.
(a) Tuition and Reenrollment.--In the case of a
servicemember who because of military service discontinues a
program of education at a covered institution of higher
education that administers a Federal financial aid program,
such institution of higher education shall--
(1) refund to such servicemember the tuition and fees
paid by such servicemember from personal funds, or from
a loan, for the portion of the program of education for
which such servicemember did not receive academic
credit because of such military service; and
(2) provide such servicemember an opportunity to
reenroll in such program of education with the same
educational and academic status such servicemember had
when such servicemember discontinued such program of
education because of such military service.
(b) Interest Rate Limitation on Student Loans.--
(1) In general.--Except as provided in paragraph (2)
of this subsection, a student loan shall be considered
an obligation or liability for the purposes of section
207.
(2) Exception.--Subsection (c) of section 207 shall
not apply to a student loan.
(c) Definitions.--In this section:
(1) The term ``covered institution of higher
education'' means a 2-year or 4-year institution of
higher education as defined in section 102 of the
Higher Education Act of 1965 (20 U.S.C. 1002) that
participates in a loan program under title IV of that
Act (20 U.S.C. 1070 et seq.).
(2) The term ``Federal financial aid program'' means
a program providing loans made, insured, or guaranteed
under part B, D, or E of title IV of the Higher
Education Act of 1965 (20 U.S.C. 1077 et seq., 1087a et
seq., 1087aa et seq.).
(3) The term ``student loan'' means any loan, whether
Federal, State, or private, to assist an individual to
attend an institution of higher education, including a
loan made, insured, or guaranteed under part B, D, or E
of title IV of the Higher Education Act of 1965 (20
U.S.C. 1077 et seq., 1087a et seq., 1087aa et seq.).
* * * * * * *
WOUNDED WARRIOR ACT
(Public Law 110-181; 122 Stat. 472)
* * * * * * *
TITLE XVI. WOUNDED WARRIOR MATTERS
* * * * * * *
Subtitle D. Disability Matters
* * * * * * *
SEC. 1646. ENHANCEMENT OF DISABILITY SEVERANCE PAY FOR MEMBERS OF THE
ARMED FORCES.
(a) * * *
(b) * * *
(c) Conforming Amendment.--Section 1161 of title 38, United
States Code, is amended by striking ``as required by section
1212(c) of title 10'' and inserting ``to the extent required by
section 1212(d) of title 10''.
(d) [(c)] * * *
* * * * * * *
VETERANS BENEFITS ACT OF 2003
(Public Law 108-183; 117 Stat. 2651; 38 U.S.C. 5101 note)
* * * * * * *
TITLE VII. OTHER MATTERS
* * * * * * *
SEC. 704. TEMPORARY AUTHORITY FOR PERFORMANCE OF MEDICAL DISABILITIES
EXAMINATIONS BY CONTRACT PHYSICIANS.
(a) * * *
(b) * * *
(c) Expiration.--The authority in subsection (a) shall
expire on [December 31, 2009] December 31, 2012. No examination
may be carried out under the authority provided in that
subsection after that date.
(d) * * *
* * * * * * *