[Federal Register Volume 72, Number 138 (Thursday, July 19, 2007)]
[Rules and Regulations]
[Pages 39562-39564]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 07-3466]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

DEPARTMENT OF HOMELAND SECURITY

Coast Guard

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 21

RIN 2900-AM50


Increase in Rates Payable Under the Montgomery GI Bill--Selected 
Reserve and Other Miscellaneous Issues

AGENCIES: Department of Defense, Department of Homeland Security 
(United States Coast Guard), and Department of Veterans Affairs.

ACTION: Final rule.

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

SUMMARY: This document amends Department of Veterans Affairs (VA) 
regulations to increase the monthly rates of basic educational 
assistance payable under the Montgomery GI Bill--Selected Reserve 
(MGIB-SR) program for fiscal years 2005 and 2006 in accordance with 
statutory requirements, increase the percentage of basic educational 
assistance payable to reservists pursuing apprenticeship or other on-
the-job training in accordance with the Veterans Benefits Act of 2004, 
and remove obsolete education break-pay provisions.

DATES: Effective Date: This final rule is effective July 19, 2007.
    Applicability Dates: The changes in the MGIB-SR rates for fiscal 
years 2005 and 2006 are applied retroactively to October 1, 2004, and 
October 1, 2005, respectively to conform to statutory requirements. The 
change in the percentage of basic educational assistance payable to 
reservists pursuing apprenticeship or other on-the-job training is 
applied retroactively to October 1, 2005, to conform to statutory 
requirements. The changes in the break-pay regulations contained in 38 
CFR 21.7640 are effective July 19, 2007.

FOR FURTHER INFORMATION CONTACT: Brandye R. Kidd, Management and 
Program Analyst, Education Service (225C), Veterans Benefits 
Administration, Department of Veterans Affairs, 810 Vermont Avenue, 
NW., Washington, DC 20420, telephone (202) 273-7420. (This is not a 
toll-free number.)

SUPPLEMENTARY INFORMATION:
I. Increase in MGIB-SR Monthly Rates
    Under the formula mandated by 10 U.S.C. 16131(b), the rates of 
basic educational assistance under the MGIB-SR payable to students 
pursuing a program of education full-time, three-quarter-time, and 
half-time must be increased by the percentage by which the total 
monthly Consumer Price Index-W for the 12-month period ending on June 
30 preceding the fiscal year during which the increase is applicable 
exceeds the Consumer Price Index-W for the 12-month period ending on 
June 30 the previous fiscal year. Using this formula, VA calculated a 2 
percent increase for fiscal year 2005 and a 3 percent increase for 
fiscal year 2006.
    Section 16131(b) also requires that VA pay reservists, who are 
pursuing a program of education at less than half-time, an 
appropriately reduced rate. Since payment for less than half-time 
educational programs became available under the MGIB-SR in fiscal year 
1990, VA has paid less than half-time students at 25 percent of the 
full-time rate. In this rule, VA continues that practice and will pay 
eligible reservists 25 percent of the increased full-time rate 
described above.
    Section 16131(d) requires that reservists pursuing a full-time 
program of apprenticeship or other on-the-job training be paid a 
percentage of the basic educational monthly rate. Benefits for the 
first 6 months of training, the second 6 months of training, and the 
remainder of the program, are payable at 75 percent, 55 percent, and 35 
percent respectively. Based on the section 16131(b) formula described 
above, there is a 2 percent increase for the apprenticeship and other 
on-the-job training pursued during fiscal year 2005 and a 3 percent 
increase for training during fiscal year 2006.
    The increase in the MGIB-SR rates are applied in accordance with 
the applicable statutory provisions discussed above. Thus, VA began 
paying the 2005 and 2006 fiscal year increases effective October 1, 
2004 and October 1, 2005 respectively.
II. Increase in the Percentage of Basic Educational Assistance Payable 
to Reservists Pursuing Apprenticeship or Other On-the-Job Training
    The Veterans Benefits Improvement Act of 2004, Public Law 108-454, 
temporarily increased the percentages payable for apprenticeship and 
other on-the-job training from 75 percent, 55 percent, and 35 percent, 
to 85 percent, 65 percent, and 45 percent of the full-time rate of 
basic educational assistance, respectively, after September 30, 2005, 
and before January 1, 2008.
    VA began paying the increased rates for reservists pursuing 
apprenticeship or other on-the-job training effective October 1, 2005, 
in accordance with Public Law 108-454.
III. Changes to Education Break-Pay Regulations Including the Removal 
of Obsolete Provisions
    We are amending 38 CFR 21.7640(b) to remove obsolete provisions and 
provide greater clarity of regulations regarding benefit payments for 
school break periods between terms. In 2003, 38 CFR 21.4138(f), 
governing payment for breaks between terms, quarters or semesters, was 
amended to conform to statutory requirements. The final rule was 
published June 9, 2003, in the Federal Register (68 FR 34327-34332). 
The preamble to that final rule states that changes made to Sec.  
21.4138(f) are applicable to the Montgomery GI Bill--Active Duty, 
Survivors' and Dependents' Educational Assistance Program, Veterans 
Educational Assistance Program, and MGIB-SR. Although we amended the 
language in Sec.  21.4138(f) in that final rule, we neglected to make a 
conforming amendment to Sec.  21.7640(b) regarding payment for breaks, 
including intervals between terms. This document amends the language in 
the aforementioned section in accordance with statutory requirements 
and the previously published rule.
    The changes to the break-pay regulations, including the removal of 
obsolete provisions, are effective from July 19, 2007.

Administrative Procedure Act

    Changes to 38 CFR part 21 are being published without regard to the 
notice-and-comment and delayed-effective-date provisions of 5 U.S.C. 
553 since they merely conform VA's existing rules to the statutory 
requirements. Accordingly, these changes involve interpretive rules 
that are exempt from

[[Page 39563]]

the notice-and-comment and delayed-effective-date requirement of 5 
U.S.C. 553(b) and (d).

Executive Order 12866

    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity). The Executive 
Order classifies a ``significant regulatory action,'' requiring review 
by the Office of Management and Budget (OMB) unless OMB waives such 
review, as any regulatory action that is likely to result in a rule 
that may: (1) Have an annual effect on the economy of $100 million or 
more or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities; (2) create a serious inconsistency or otherwise interfere 
with an action taken or planned by another agency; (3) materially alter 
the budgetary impact of entitlements, grants, user fees, or loan 
programs or the rights and obligations of recipients thereof; or (4) 
raise novel legal or policy issues arising out of legal mandates, the 
President's priorities, or the principles set forth in the Executive 
Order.
    The economic, interagency, budgetary, legal, and policy 
implications of this final rule have been examined and it has been 
determined not to be a significant regulatory action under Executive 
Order 12866.

Paperwork Reduction Act

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3521).

Regulatory Flexibility Act

    The initial and final regulatory flexibility analyses requirements 
of sections 603 and 604 of the Regulatory Flexibility Act, 5 U.S.C. 
601-612, are not applicable to this rule, because a notice of proposed 
rulemaking is not required for this rule. Even so, the Secretary of 
Veterans Affairs hereby certifies that this final rule will not have a 
significant economic impact on a substantial number of small entities 
as they are defined in the Regulatory Flexibility Act. This final rule 
directly affects only individuals and does not directly affect small 
entities. Therefore, this final rule is also exempt pursuant to 5 
U.S.C. 605(b) from the initial and final regulatory flexibility 
analyses requirements of sections 603 and 604.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any given year. This final rule would have no such effect 
on State, local, and tribal governments, or on the private sector.

Catalog of Federal Domestic Assistance

    There is no Catalog of Federal Domestic Assistance number for the 
program affected by this final rule.

List of Subjects in 38 CFR Part 21

    Administrative practice and procedure, Armed forces, Civil rights, 
Claims, Colleges and universities, Conflict of interests, Education, 
Employment, Grant programs--education, Grant programs--veterans, Health 
care, Loan programs--education, Loan programs--veterans, Manpower 
training programs, Reporting and recordkeeping requirements, Schools, 
Travel and transportation expenses, Veterans, Vocational education, 
Vocational rehabilitation.

    Approved: February 9, 2007.
Gordon H. Mansfield,
Deputy Secretary of Veterans Affairs.

    Approved: March 12, 2007.
Clifford L. Pearson,
Rear Admiral, U.S. Coast Guard, Assistant Commandant for Human 
Resources.

    Approved: May 7, 2007.
T.F. Hall,
Assistant Secretary of Defense for Reserve Affairs.

0
For the reasons stated above, VA amends 38 CFR part 21, subpart L, as 
set forth below.

PART 21--VOCATIONAL REHABILITATION AND EDUCATION

Subpart L--Educational Assistance for Members of the Selected 
Reserve

0
1. Revise the authority citation for part 21, subpart L, to read as 
follows:

    Authority: 10 U.S.C. ch. 1606; 38 U.S.C. 501(a), 512, ch. 36, 
and as stated in specific sections.


0
2. Amend Sec.  21.7635(c)(3) by removing ``Sec.  21.7640'' and adding, 
in its place, ``Sec.  21.4138(f)''.

0
3. Amend Sec.  21.7636 by revising paragraphs (a)(1), (a)(2)(i), and 
(a)(3) to read as follows:


Sec.  21.7636  Rates of payment.

    (a) Monthly rate of educational assistance. (1) Except as otherwise 
provided in this section or in Sec.  21.7639, basic educational 
assistance is payable at the following monthly rates.
    (i) For training that occurs after September 30, 2004, and before 
October 1, 2005:

------------------------------------------------------------------------
                        Training                           Monthly rate
------------------------------------------------------------------------
Full time..............................................          $288.00
\3/4\ time.............................................           216.00
\1/2\ time.............................................           143.00
\1/4\ time.............................................            72.00
------------------------------------------------------------------------

    (ii) For training that occurs after September 30, 2005:

------------------------------------------------------------------------
                        Training                           Monthly rate
------------------------------------------------------------------------
Full time..............................................          $297.00
\3/4\ time.............................................           222.00
\1/2\ time.............................................           147.00
\1/4\ time.............................................            74.25
------------------------------------------------------------------------

    (2)(i) The monthly rate of basic educational assistance payable to 
a reservist for apprenticeship or other on-the-job training full time 
is payable at the following rates.
    (A) For training which occurs after September 30, 2004, and before 
October 1, 2005:

------------------------------------------------------------------------
                        Training                           Monthly rate
------------------------------------------------------------------------
First 6 months of pursuit of training..................          $216.00
Second 6 months of pursuit of training.................           158.40
Remaining pursuit of training..........................           100.80
------------------------------------------------------------------------

    (B) For training which occurs after September 30, 2005:

------------------------------------------------------------------------
                        Training                           Monthly rate
------------------------------------------------------------------------
First 6 months of pursuit of training..................          $252.45
Second 6 months of pursuit of training.................           193.05
Remaining pursuit of training..........................           133.65
------------------------------------------------------------------------

    (ii) * * *
    (3) The monthly rate of basic educational assistance payable to a 
reservist for pursuit of a cooperative course is as follows:
    (i) For full-time training that occurs after September 30, 2004, 
and before October 1, 2005, the rate payable is the rate stated in 
paragraph (a)(1)(i) of this section.
    (ii) For full-time training that occurs after September 30, 2005, 
the rate payable is the rate stated in paragraph (a)(1)(ii) of this 
section.
* * * * *

[[Page 39564]]


0
4. Amend Sec.  21.7640 by revising paragraph (b) to read as follows:


Sec.  21.7640  Release of payments.

* * * * *
    (b) Payment for breaks, including intervals between terms. In 
administering 10 U.S.C. chapter 1606, VA will apply the provisions of 
Sec.  21.4138(f) when determining whether a reservist is entitled to 
payment for a break, including an interval between terms.

(Authority: 10 U.S.C. 16136(b), 38 U.S.C. 3680)
* * * * *
[FR Doc. 07-3466 Filed 7-18-07; 8:45 am]
BILLING CODE 8320-01-P