[Federal Register Volume 73, Number 130 (Monday, July 7, 2008)]
[Proposed Rules]
[Pages 38350-38352]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-15278]


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DEPARTMENT OF DEFENSE

Department of the Navy

[No. USN-2008-0009]

32 CFR Part 726

RIN 0703-AA85


Payments of Amounts Due Mentally Incompetent Members of the Naval 
Service

AGENCY: Department of the Navy, DoD.

ACTION: Proposed rule.

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SUMMARY: The Department of the Navy is amending its rules to update 
existing sections relating to the authority and procedures to designate 
trustees for Navy and Marine Corps service members who have been 
determined to be mentally incompetent pursuant to 37 U.S.C. Chapter 11. 
The proposed amendments will comport with current policy reflected in 
Chapter XIV of the Manual of the Judge Advocate General (JAGMAN).

DATES: Comment Date: Interested parties should submit written comments 
on or before September 5, 2008.

ADDRESSES: You may submit comments, identified by docket number and/or 
Regulatory Information Number (RIN) and title, by any of the following 
methods:
    Federal eRulemaking Portal: http://www.regulations.gov.
    Follow the instructions for submitting comments.
    Mail: Federal Docket Management System Office, 1160 Defense 
Pentagon, Washington DC 20301-1160.
    Instructions: All submissions received must include the agency name 
and docket or RIN number for this Federal Register document. The 
general policy for comments and other submissions from members of the 
public is to make these submissions available for public viewing on the 
Internet at http://regulations.gov as they are received without change, 
including any personal identifiers or contact information.

FOR FURTHER INFORMATION CONTACT: Lieutenant Tanya M. Cruz, JAGC, U.S. 
Navy, Office of the Judge Advocate General (Administrative Law), 
Department of the Navy, 1322 Patterson Ave., SE., Suite 3000, 
Washington Navy Yard, DC 20374-5066, telephone: 703-604-8216.

SUPPLEMENTARY INFORMATION: The Department of the Navy is amending 32 
CFR part 726 to comport with current policy as stated in Chapter XIV of 
the JAGMAN governing the authority and procedures to designate trustees 
for members of the Naval service who have been determined to be 
mentally incompetent in accordance with 37 U.S.C. Chapter 11. As a 
result of organizational change in the Office of the Judge Advocate 
General, the functions under Chapter XIV were transferred from the 
Judge Advocate General to the Defense Finance and Accounting Service--
Cleveland Center (DFAS-CL), Office of Continuing Government Activity 
(CGA). The transfer of functions and the responsibilities of DFAS have 
been incorporated into the JAGMAN. The proposed rule will update the 
existing section to reflect current agency regulations. Interested 
persons are invited to comment in writing on this amendment. All 
written comments received will be considered in making the proposed 
amendments to 32 CFR part 726. It has been determined that this 
proposed rule amendment is not a major rule within the criteria 
specified in Executive Order 12866, as amended by Executive Order 
13258, and does not have substantial impact on the public.

Matters of Regulatory Procedure

Executive Order 12866, ``Regulatory Planning and Review''

    It has been determined that 32 CFR part 726 is not a significant 
regulatory action. The rule does not:
    (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 the 
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 
this Executive Order.

Unfunded Mandates Reform Act (Sec. 202, Pub. L. 104-4)

    It has been certified that 32 CFR part 726 does not contain a 
Federal Mandate that may result in the expenditure by State, local, and 
tribal governments, in aggregate, or by the private sector, of $100 
million or more in any one year.

Public Law 96-511. ``Paperwork Reduction Act'' (44 U.S.C. Chapter 35)

    It has been certified that 32 CFR part 726 does not impose any 
reporting or recordkeeping requirements under the Paperwork Reduction 
Act of 1995 (44 U.S.C. Chapter 35).

Federalism (Executive Order 13132)

    It has been certified that 32 CFR part 726 does not have federalism 
implications, as set forth in Executive Order 13132. This rule does not 
have substantial direct effects on:
    (1) The States;
    (2) The relationship between the National Government and the 
States; or
    (3) The distribution of power and responsibilities among the 
various levels of government.

[[Page 38351]]

List of Subjects in 32 CFR Part 726

    Administrative practice and procedure, Military personnel, 
Reporting and recordkeeping requirements, Trusts and trustees.

    For the reasons set forth in the preamble, the Department of the 
Navy proposes to amend 32 CFR part 726 as follows:

PART 726--PAYMENTS DUE MENTALLY INCOMPETENT MEMBERS, PHYSICAL 
EXAMINATIONS OF SUCH MEMBERS AND TRUSTEE DESIGNATIONS

    1. The authority citation for 32 CFR part 726 is revised to read as 
follows:

    Authority: 5 U.S.C. 301; 10 U.S.C. 5013, and 5148; 37 U.S.C. 
601-604, and 1001; 32 CFR 700.105 and 700.312.


Sec.  726.1  [Amended]

    2. Section 726.1 is amended by removing ``title 11 of chapter 37'' 
and adding the words ``Chapter 11 of Title 37'' in its place.


Sec.  726.2  [Amended]

    3. Section 726.2 is amended by adding three new sentences to the 
end of paragraph (a) to read as follows:


Sec.  726.2.  Scope.

    (a) * * * The Secretary of the Navy has authority to designate a 
trustee in the absence of notice that a legal committee, guardian, or 
other legal representative has been appointed by a State court of 
competent jurisdiction (37 U.S.C. 601-604). This authority is exercised 
by the Defense Finance and Accounting Service--Cleveland Center (DFAS-
CL), who has delegated it to DFAS-CL, Office of Continuing Government 
Activity (DFAS-CL(CGA)). Trustees receive the active duty pay and 
allowances, amounts due for accrued or accumulated leave, and retired 
pay or retainer pay, that are otherwise payable to a member found by 
competent medical authority to be mentally incapable of managing his 
affairs.
* * * * *


Sec.  726.3  [Amended]

    4. Section 726.3 is amended by removing ``The Judge Advocate 
General or his designee'' and adding ``DFAS-CL (CGA)'' in its place.
    5. Section 726.4 is revised to read as follows:


Sec.  726.4.  Procedures.

    (a) Competency Board. (1) The commanding officer of the cognizant 
Naval medical facility will convene a board of not less than three 
Medical Department officers or physicians, one of whom will be a Navy 
psychiatrist or clinical psychologist, when there is evidence that a 
member may be incapable of handling his financial affairs. The board 
will be convened in accordance with Chapter 18, Manual of the Medical 
Department (MANMED). The board may include members of the Reserve 
components on active or inactive duty. When active duty Navy or Marine 
Corps members are hospitalized in non-Naval medical facilities, the 
Military Medical Support Office will ensure compliance with Chapter 18, 
MANMED.
    (2) DFAS-CL(CGA) may request the commanding officer of any Naval 
medical facility, or request the commanding officer of another service 
medical facility or administrator of a Department of Veterans Affairs 
medical facility, convene a competency board in accordance with this 
section to determine the mental capability of a member to manage his 
financial affairs.
    (3) A finding of restoration of competency or capability to manage 
personal and financial affairs may be accomplished in the same manner 
specified in Chapter 18, MANMED, except that the board may consist of 
one or two Medical Department officers or physicians, one of whom must 
be a Navy psychiatrist or clinical psychologist.
    (4) At least one officer on the competency board, preferably the 
psychiatrist or clinical psychologist, will personally observe the 
member and ensure that the member's medical record, particularly that 
portion concerning his mental health, is accurate and complete.
    (5) The requirement to convene a competency board under this 
chapter is in addition to and separate from the medical board 
procedures. Each board member signs the report of the board and 
certifies whether the member is or is not mentally capable of managing 
his financial affairs. After approval by the convening authority, the 
original board report is forwarded to DFAS-CL(CGA).
    (b) Records. The convening authority will forward the original of 
each board report to the Defense Finance and Accounting Service--
Cleveland Center, Office of Continuing Government Activity (Code CGA), 
Post Office Box 998021, Room 2323, Cleveland, OH 44199-80216. If a 
member is found to be not mentally capable of managing his financial 
affairs, the forwarding endorsement will set forth the name, 
relationship, address, and telephone number(s) of the member's next of 
kin, and any other information that will assist to identify a 
prospective trustee.
    6. Section 726.5 is revised to read as follows:


Sec.  726.5  Procedures for designation of a trustee.

    Upon receipt of a report of a competency board that a member has 
been found mentally incapable of managing his financial affairs, DFAS-
CL(CGA) will initiate action to appoint a trustee, provided no notice 
of appointment of a committee, guardian, or other legal representative 
by a State court of competent jurisdiction has been received by DFAS-
CL(CGA).
    7. Section 726.6 is revised to read as follows:


Sec.  726.6  Travel orders.

    The Chief of Naval Personnel or the Deputy Commandant, Manpower & 
Reserve Affairs, may issue travel orders to a member to appear before a 
competency board convened to determine whether the member is mentally 
capable of managing his financial affairs. In the case of permanently 
retired members, travel will be at no cost to the Government.
    8. Section 726.7 is revised to read as follows:


Sec.  726.7  Status of pay account.

    Upon notification by the commanding officer of the medical facility 
preparing the board report that a member has been declared mentally 
incapable of managing his financial affairs, DFAS-CL(CGA) will suspend 
the member's pay. Thereafter, DFAS-CL(CGA) or his designee will direct 
payment of monies to:
    (a) The appointed trustee;
    (b) The legal representative appointed by a State court of 
competent jurisdiction; or
    (c) Directly to the member following a determination the member is 
capable of managing his financial affairs.
    9. Section 726.8 is revised to read as follows:


Sec.  726.8  Emergency funds and health and comfort.

    Until a trustee is appointed, DFAS-CL(CGA) may appoint the member's 
designated next of kin to receive emergency funds equal to, but not to 
exceed the amount of pay due the incompetent member for a period of one 
month. These funds will be deducted from the member's pay account and 
will be used for the benefit of the member and any legal dependents.
    10. Section 726.9 is revised to read as follows:


Sec.  726.9  Reports and supervision of trustees.

    (a) Accounting reports. The trustee designated by DFAS-CL(CGA) will

[[Page 38352]]

submit accounting reports annually or at such other times as DFAS-
CL(CGA) or his designee directs. DFAS-CL(CGA) will provide forms to be 
used by trustees for the required accounting report. The report will 
account for all funds received from the Navy or Marine Corps on behalf 
of the member. When payments to a trustee are terminated for any 
reason, the trustee will submit a final accounting report to DFAS-
CL(CGA). Upon approval of the final accounting report, the trustee and 
the surety will be discharged from liability.
    (b) Failure to submit a report and default. If an accounting report 
is not received by the date designated by DFAS-CL(CGA) or an accounting 
is unsatisfactory, DFAS-CL(CGA) will notify the trustee in writing. If 
a satisfactory accounting is not received by DFAS-CL(CGA) within the 
time specified, the trustee will be declared in default of the trustee 
agreement and will be liable for all unaccounted trustee funds. If a 
trustee is declared in default of the trustee agreement, DFAS-CL(CGA) 
will terminate payments to the trustee and, if necessary, a successor 
trustee may be appointed. The trustee and surety will be notified in 
writing by DFAS-CL(CGA) of the declaration of default. The notification 
will state the reasons for default, the amount of indebtedness to the 
Government, and will demand payment for the full amount of 
indebtedness. If payment in full is not received by DFAS-CL(CGA) within 
an appropriate period of time from notification of default, the account 
may be forwarded to the Department of Justice for recovery of funds 
through appropriate civil action.

    Dated: June 30, 2008.
T.M. Cruz,
Lieutenant, Judge Advocate General's Corps, U.S. Navy, Federal Register 
Liaison Officer.
[FR Doc. E8-15278 Filed 7-3-08; 8:45 am]
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