[Federal Register Volume 81, Number 115 (Wednesday, June 15, 2016)]
[Rules and Regulations]
[Pages 38936-38948]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-14259]


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DEPARTMENT OF JUSTICE

28 CFR Part 104

[Docket No. CIV 151]
RIN 1105-AB49


James Zadroga 9/11 Victim Compensation Fund Reauthorization Act

AGENCY: Department of Justice.

ACTION: Interim final rule.

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SUMMARY: On December 18, 2015, President Obama signed into law the 
James Zadroga 9/11 Victim Compensation Fund Reauthorization Act (the 
``Reauthorized Zadroga Act''). The Act extends the September 11th 
Victim Compensation Fund of 2001 which provides compensation to any 
individual (or a personal representative of a deceased individual) who 
suffered physical harm or was killed as a result of the terrorist-
related aircraft crashes of September 11, 2001, or the rescue and 
recovery efforts during the immediate aftermath of such crashes or the 
debris removal efforts that took place in the immediate aftermath of 
those crashes. Special Master Sheila L. Birnbaum, appointed by the 
Attorney General to administer the Fund, is issuing this Interim Final 
Rule to address changes required by the Reauthorized Zadroga Act. 
Specifically, the statute extends the time period during which eligible 
claimants may submit claims for compensation until December 18, 2020, 
increases the Victim Compensation Fund's total funding available to pay 
claims, creates different categories of claims, directs the Victim 
Compensation Fund to issue full compensation to eligible claimants and 
imposes limitations on certain components of future loss calculations.

DATES: Effective date: This rule is effective June 15, 2016. Comment 
date: Written comments must be submitted on or before July 15, 2016. 
Comments received by mail will be considered timely if they are 
postmarked on or before that date. The electronic Federal Docket 
Management System (FDMS) will accept comments until midnight Eastern 
Time at the end of that day.

ADDRESSES: Please address all comments regarding this rule by U.S. mail 
to: Jordana Feldman, September 11th Victim Compensation Fund, Civil 
Division, U.S. Department of Justice, 290 Broadway, Suite 1300, New 
York, New York 10007. To ensure proper handling, please reference CIV 
Docket No. 151 on your correspondence. Comments may also be sent 
electronically through http://regulations.gov using the electronic 
comment form provided on that site. An electronic copy of this document 
is also available at the http://regulations.gov Web site. The Civil 
Division will accept attachments to electronic comments in Microsoft 
Word, WordPerfect, or Adobe PDF formats only.

FOR FURTHER INFORMATION CONTACT: Catherine V. Emerson, Director, Office 
of Management Programs, Civil Division, U.S. Department of Justice, 
Main Building, Room 3140, 950 Pennsylvania Avenue NW., Washington, DC 
20530, telephone 855-885-1555 (TTY 855-885-1558).

SUPPLEMENTARY INFORMATION: 

Public Comments

    The Department is publishing this interim final rule, effective on 
June 15, 2016, the statutory deadline for updating the existing 
regulations in light of the statutory changes made by the Reauthorized 
Zadroga Act.
    The Department is providing a 30-day period for public comment. The 
regulatory text of this rule is restating all of the provisions of 28 
CFR part 104, as revised, for ease of reference and application for the 
filing of claims. Commenters should be aware, though, that only certain 
portions of the existing regulations are being revised at this time, 
and the Department is only soliciting public comments on the changes 
being made from the existing

[[Page 38937]]

text of the regulations in 28 CFR part 104. These changes are clearly 
indicated in a redlined/strikeout version of the regulatory text that 
is included at www.regulations.gov and is available at www.vcf.gov or 
by calling 855-885-1555 (TTY 855-885-1558). Accordingly, public 
comments will be considered only with respect to the revisions made by 
the interim final rule and not as to provisions of the regulations that 
were already in effect prior to enactment of the Reauthorized Zadroga 
Act.

Posting of Public Comments

    Please note that all comments received are considered part of the 
public record and made available for public inspection online at http://www.regulations.gov. Information made available for public inspection 
includes personal identifying information (such as your name, address, 
etc.) voluntarily submitted by the commenter.
    If you wish to submit personal identifying information (such as 
your name, address, etc.) as part of your comment, but do not wish it 
to be posted online, you must include the phrase ``PERSONAL IDENTIFYING 
INFORMATION'' in the first paragraph of your comment. You must also 
locate all the personal identifying information that you do not want 
posted online in the first paragraph of your comment and identify what 
information you want the agency to redact. Personal identifying 
information identified and located as set forth above will be placed in 
the agency's public docket file, but not posted online.
    If you wish to submit confidential business information as part of 
your comment but do not wish it to be posted online, you must include 
the phrase ``CONFIDENTIAL BUSINESS INFORMATION'' in the first paragraph 
of your comment. You must also prominently identify confidential 
business information to be redacted within the comment. If a comment 
has so much confidential business information that it cannot be 
effectively redacted, the agency may choose not to post that comment 
(or to only partially post that comment) on http://www.regulations.gov. 
Confidential business information identified and located as set forth 
above will not be placed in the public docket file, nor will it be 
posted online.
    If you wish to inspect the agency's public docket file in person by 
appointment, please see the FOR FURTHER INFORMATION CONTACT paragraph.

Background

    Pursuant to Title IV of Public Law 107-42 (``Air Transportation 
Safety and System Stabilization Act'') (2001 Act), the September 11th 
Victim Compensation Fund of 2001 was open for claims from December 21, 
2001, through December 22, 2003. The Fund provided compensation to 
eligible individuals who were physically injured as a result of the 
terrorist-related aircraft crashes of September 11, 2001, and to 
personal representatives of those who died as a result of the crashes.
    Special Master Kenneth R. Feinberg was appointed by the Attorney 
General to administer the Fund. The Fund was governed by Interim Final 
Regulations issued on December 21, 2001, see 66 FR 66274, and by Final 
Regulations issued on March 13, 2002, see 67 FR 11233. During its two 
years of operation, the Fund distributed over $7.049 billion to 
survivors of 2,880 persons killed in the September 11th attacks and to 
2,680 individuals who were injured in the attacks or in the rescue 
efforts conducted thereafter. In 2004, Special Master Feinberg issued a 
report describing how the fund was administered. See Final Report of 
the Special Master for the September 11th Victim Compensation Fund of 
2001.
    On January 2, 2011, President Obama signed Public Law 111-347, the 
James Zadroga 9/11 Health and Compensation Act of 2010 (Zadroga Act) 
Public Law 114-113, Div. O, Title IV, into law. Title I of the Zadroga 
Act established a program within the Department of Health and Human 
Services to provide medical monitoring and treatment benefits to 
eligible individuals. Title II amended the 2001 Act and reopened the 
Fund. Among other changes, Title II added new categories of 
beneficiaries for the Fund and set new filing deadlines. It also 
imposed a cap on the total awards that can be paid by the Fund and 
limited the fees that an attorney may receive for awards made under the 
Fund.
    The Zadroga Act did not appropriate administrative funds for the 
Fund to begin taking and processing claims. On April 15, 2011, 
President Obama signed into law Public Law 112-10, the continuing 
budget resolution for 2011, which permits the Fund to draw on the money 
originally allocated in the Zadroga Act in order to pay for its 
administrative expenses, beginning on October 1, 2011.
    The Attorney General appointed Sheila L. Birnbaum to serve as 
Special Master and to administer the Fund. On June 21, 2011, the 
Special Master issued the Notice of Proposed Rulemaking, which provided 
for a 45-day public comment period. On August 26, 2011, after 
evaluating the comments received, the Special Master signed the Final 
Rule, and on August 31, 2011, the Final Rule was published in the 
Federal Register. See 76 FR 54112.
    On December 18, 2015, President Obama signed into law Public Law 
114-113, providing for the reauthorization of the Zadroga Act. The 
Reauthorized Zadroga Act extends the time period during which eligible 
claimants may submit claims, increases the Victim Compensation Fund's 
total funding available to pay claims, creates different categories of 
claims, directs the Victim Compensation Fund to issue full compensation 
to eligible claimants and instructs the Victim Compensation Fund to 
implement certain changes to the policies and procedures used to 
evaluate and process claims.
    This Interim Final Rule addresses those changes mandated by the 
statute. In accordance with the rulemaking process, this Interim Final 
Rule is effective on June 15, 2016. Once the rule is published in the 
Federal Register, there will be a 30-day public comment period. After 
that period, the Special Master will review and evaluate any comments 
and will publish a final rule with any clarifications or amendments 
deemed appropriate.

A. Summary of Key Statutory Changes

    The Reauthorized Zadroga Act makes several changes to the Zadroga 
Act, including the following: The statute extends the deadline for 
filing claims; adds or changes certain eligibility definitions; 
establishes different categories of claims based on timing of the 
issuance of a letter setting forth the total amount of compensation to 
which a claimant is entitled; changes certain policies and procedures 
for evaluating claims and computing losses; removes a category of 
losses previously compensable by the Fund; requires that the amount of 
compensation to which a claimant is entitled not exceed the collateral 
source compensation that the claimant has received or is entitled to 
receive; increases the amount of funding available to pay claims and 
administrative costs and accelerates of the availability of funding; 
and directs the Fund to perform an annual reassessment of policies and 
procedures.
    Specifically, the statute:
     Extends the deadline for filing a claim from the original 
deadline of October 3, 2016 to the new deadline of December 18, 2020;
     Codifies the definition of ``9/11 crash site'' to reflect 
the definition of the

[[Page 38938]]

New York City exposure zone provided in the 2011 regulations;
     Adds new definitions regarding the types of conditions 
covered by referencing WTC-related health conditions as defined by 
Section 3312(a) and 3322(b) of the Public Health Service Act (42 U.S.C. 
300mm-22 and 300mm-32) and specifically excluding mental health 
conditions;
     Establishes two categories of claims--Group A and Group 
B--based on the date the Special Master ``postmarks and transmits'' a 
final award determination to the claimant;
     Imposes caps on the amount of non-economic loss that can 
be computed for different types of conditions (categorized as cancer 
and non-cancer);
     Imposes a $200,000 cap on the annual gross income, as 
defined in Section 61 of the Internal Revenue Code, used to determine 
economic loss;
     Directs the Victim Compensation Fund to prioritize the 
compensation of claims that present the most debilitating physical 
conditions;
     Eliminates ``future medical expense loss'' as a 
compensable economic loss;
     Eliminates any minimum award to the extent that collateral 
source offsets exceed the amount of compensation;
     Makes the original $2,775,000,000 appropriation available 
immediately to pay claims. Previously, only $875,000,000 of this amount 
was available through October 3, 2016. It also provides an additional 
$4,600,000,000 in funding that becomes available in October 2016; and
     Directs the Special Master to conduct an annual 
reassessment of policies and procedures.

B. Revisions to the Rule Conforming to Statutory Changes

    These interim final regulations amend the Department of Justice's 
August 2011 final regulations in order to reflect changes required by 
the Reauthorized Zadroga Act. Specifically:
     Section 104.2 Eligibility definitions and requirements is 
revised to include the definition of ``Group A claims'' and ``Group B 
claims.'' It also includes the definition of a ``WTC-Related Physical 
Health Condition'', and makes clear that mental health conditions are 
not covered. This section also reflects the codification of the prior 
regulations in terms of one of the definitions of the ``9/11 crash 
site''--the definition of the New York City exposure zone.
     Section 104.41 Amount of compensation is revised to 
reflect the statutory mandate that no Group B claim shall receive 
compensation greater than the amount of loss determined less the amount 
of any collateral source compensation that the claimant has received or 
is entitled to receive, thus eliminating the $10,000 minimum award that 
the Fund issued for Group A claims in the event that collateral offsets 
exceeded losses.
     Section 104.43 Determination of presumed economic loss for 
decedents is revised to account for the $200,000 annual gross income 
cap and the elimination of future medical expenses loss as a 
compensable loss.
     Section 104.44 Determination of presumed economic loss for 
injured claimants is revised to account for the $200,000 annual gross 
income cap and the elimination of future medical expenses loss as a 
compensable loss.
     Section 104.46 Determination of presumed noneconomic 
losses for injured claimants is revised to reflect the noneconomic loss 
cap of $250,000 for any single type of cancer and a noneconomic loss 
cap of $90,000 for any single type of non-cancer condition
     Section 104.51 Payments to eligible individuals is revised 
to reflect the amount and timing of availability of funding to pay 
claims and administrative costs: The $2,755,000,000 previously 
appropriated over time to be made immediately available and paid as 
soon as practicable and an additional $4,600,000,000 to be available in 
October 2016. The section also reflects the directive to the Special 
Master to prioritize the compensation of claims that present the most 
debilitating physical conditions. The section further addresses the 
statutory mandate to conduct an annual reassessment of policies and 
procedures and make adjustments as necessary to ensure that total 
expenditures do not exceed available funds.
     Section 104.62 Time limit on filing claims is revised to 
reflect the extended statutory deadline for filing claims, from October 
3, 2016 to December 18, 2020.

C. Additional Regulatory Changes To Reduce Burdens for Claimants

    This rule includes four additional regulatory changes, not required 
by the statute. All of these changes are designed to benefit claimants 
or reduce claimant burden.
    First, in section 104.3(c)(3), the definition of ``spouse'' has 
been expanded. Under the previous definition, the Special Master was 
required to identify the spouse of the deceased victim as the person 
who was reported or who legally could have been identified as the 
spouse on the victim's Federal tax return for the year prior to the 
year of the victim's death. The previous definition included two 
exceptions: (1) If the victim was married or divorced in accordance 
with applicable state law on or after January 1 of the year of the 
victim's death; or (2) If the victim was not required by law to file a 
Federal tax return for the year prior to the year of the victim's 
death. The updated regulations expand this definition to include a 
third exception: If the victim had a same-sex spouse who was lawfully 
married to the victim under applicable state law. The 2011 regulations 
were published when Section 3 of the Defense of Marriage Act was in 
effect, prohibiting the Federal government from recognizing same-sex 
marriages. As such, same-sex married couples could not identify 
themselves as married on their tax returns. Since that time, that 
section was held to be unconstitutional. These updated regulations 
reflect the changed law. They also reflect the Fund's policy to treat a 
same-sex spouse who was legally married to the victim under applicable 
state law as a spouse for purposes of this program.
    Second, section 104.22(c)(1) has been revised to remove the 
requirement that all claimants shall, at a minimum, submit all tax 
returns that were filed for the period beginning three years prior to 
the year of death or discovery of the injury and ending with the year 
the claim was filed or the year of death. Over the course of the 
program, the Special Master has found that this requirement can be 
burdensome in some cases where the tax returns are not necessary for 
determination. The Special Master retains the discretion to require the 
submission of tax returns where necessary for evaluation of the claim. 
For example, the Special Master may require the submission of tax 
returns where a claimant is seeking loss of self-employment income or 
loss of partnership income, or in order to evaluate whether an 
individual was identified on a deceased victim's Federal tax return for 
the year prior to the year of the victim's death. Accordingly, the 
updated regulations allow the Special Master discretion to determine 
whether and to what extent tax returns should be submitted for a 
particular claimant.
    Third, section 104.45(e) has been added as a new paragraph to 
address the determination of noneconomic losses for claimants who have 
a WTC-Related Physical Condition and who are found eligible for 
economic loss. The Reauthorized Zadroga Act imposes caps on the amount 
of noneconomic loss for an eligible cancer ($250,000) and an eligible 
non-cancer condition ($90,000). The revised regulations clarify that 
the

[[Page 38939]]

Special Master shall determine the appropriate noneconomic loss for 
economic loss claims in the same manner that she determines noneconomic 
loss only claims, see section 104.46, taking into account the extent of 
disability and the fact that different eligible conditions may 
contribute to the disability.
    The regulations further make clear in section 104.46 that the 
Reauthorized Zadroga Act does not place an aggregate cap on noneconomic 
loss but merely states that the loss for any type of cancer shall not 
exceed $250,000 and the loss for any type of non-cancer shall not 
exceed $90,000. A noneconomic loss may result from both a cancer and 
non-cancer condition and/or may result from more than one type of 
cancer. The revised regulations provide that the Special Master has 
discretion to consider the effect of multiple cancer conditions or 
multiple cancer and non-cancer conditions in computing the total 
noneconomic loss in such claims.
    Fourth, section 104.52 has been revised to remove the requirement 
that, for a claim filed by a Personal Representative on behalf of a 
deceased victim, the Personal Representative shall submit a plan of 
distribution for any award received from the Fund before the payment is 
authorized. Because the Personal Representative has an independent 
fiduciary obligation to distribute the award in accordance with 
applicable state law or court order, this documentation may not be 
needed in every case. Therefore, the revised regulations allow the 
Special Master discretion to determine whether a distribution plan is 
required prior to authorizing the payment authorization on a particular 
claim.

Regulatory Certifications

Administrative Procedure Act

    The Department's implementation of this rule as an interim final 
rule, with provision for post-promulgation public comment, is based on 
Sections 553(b)(A), 553(b)(B) and 553(d) of the Administrative 
Procedure Act. 5 U.S.C. 553. Under Section 553(b), an agency may issue 
a rule without notice of proposed rulemaking and the pre-promulgation 
opportunity for public comment where ``good cause'' exists or for 
``interpretive rules, general statements of policy, or rules of agency 
organization, procedure, or practice.''
    The revisions made by this interim final rule fit within the 
exceptions to the requirement for pre-promulgation opportunity for 
notice and comment set out in Section 553. See 5 U.S.C. 553(b)(A). All 
of the revisions identified in Part B above, ``Revisions to the Rule 
Conforming to Statutory Changes'' are interpretive rules issued by the 
Department to advise the public of the Department's construction of the 
new statute. These revisions to the rule merely explain or clarify the 
application of the substantive law set forth in the Reauthorized 
Zadroga Act; they do not create new rights or impose obligations 
independent of the statute. As noted, the Reauthorized Zadroga Act 
requires revisions to the implementing regulations including extending 
the deadline for filing claims, defining different categories of claims 
(Group A and Group B), changing certain policies and procedures for 
evaluating claims and computing compensable losses and increasing the 
funding available to pay claims, among other things. The interim final 
rule merely incorporates those changes and explains certain provisions 
in more detail, such as those relating to the filing and evaluation of 
claims and computation of losses for claims defined as Group B under 
the statute.
    The four additional changes, described in Part C, ``Additional 
Regulatory Changes to Reduce Burdens for Claimants,'' similarly are not 
subject to formal notice-and-comment requirements. The first change, to 
section 104.3(c)(3) is interpretive and clarifies the meaning of the 
term ``spouse'' consistent with law and pre-existing Department policy. 
The second and fourth changes, which eliminate certain documentation 
requirements, see sections 104.22(c)(1) and 104.52, are procedural in 
nature; they eliminate a required component of the documentation 
submitted with a claim and instead advise that the Special Master 
retains the discretion to ask for these documents if needed. Finally, 
the addition of section 104.45(e) and the revisions of section 104.46 
reflect general statements of policy; they serve only to advise the 
public that the Special Master may exercise her discretionary power in 
certain ways. For these reasons, the interim final rule is not subject 
to the formal notice-and-comment requirements under Section 553 of the 
APA.
    Furthermore, an agency may find good cause to exempt a rule from 
provisions of the APA if it is determined that those procedures are 
impracticable, unnecessary, or contrary to the public interest. (5 
U.S.C. 553(b)(B)). The Department finds that it is unnecessary and 
contrary to the public interest to seek public comment prior to 
promulgating this interim final rule for several reasons. First, 
delaying the implementation of the rule would delay the determination 
and payment of appropriate compensation for eligible Group B claims. 
Compensation determinations and corresponding payments will not be 
issued until the rule is effective. Thus, eligible claimants, 
particularly those suffering from terminal illness or extreme financial 
hardship, would be harmed by any delay. Second, the regulations that 
the interim final rule modifies were enacted pursuant to notice and 
comment rulemaking and to a large extent reflect changes recently 
mandated by statute. As previously discussed, the changes made by this 
interim final rule that are not mandated by the Reauthorized Zadroga 
Act reduce certain regulatory burdens on claimants or otherwise benefit 
the claimant by alleviating unnecessary document submission 
requirements and asserting the Special Master's discretion to 
prioritize the compensation of claims based on indicators that 
demonstrate severity of the claimant's eligible conditions. Third, the 
interim rule will be subject to public comment before its final 
implementation. The Department will consider any public comments made 
following publication of this interim final rule and make any 
appropriate adjustments or clarifications in the final rule. Finally, 
the deadline imposed by Congress to implement the regulations is 
exceedingly strict and therefore the Department has a limited period of 
time within which to update the regulations.
    The APA also permits an agency to make a rule effective upon date 
of publication in the Federal Register where ``good cause'' exists or 
for ``interpretive rules and statements of policy.'' 5 U.S.C. 553(d). 
As stated, the Department has determined that it would be unnecessary 
and contrary to the public interest to engage in full notice and 
comment rulemaking before putting these interim final regulations into 
effect, and that it is in the public interest to promulgate interim 
final regulations. For the same reasons, the Department has determined 
that there is good cause to make these interim final regulations 
effective immediately upon publication in the Federal Register, in 
accordance with Section 553(d) of the APA (5 U.S.C. 553(d)). Therefore, 
waiver of the 30-day period prior to the rule's effective date is 
appropriate here. The Department welcomes public comments on the 
changes being made by this interim final rule, and will carefully 
review any comments to ensure that any substantive concerns or issues 
regarding these changes are addressed in the final rule.

[[Page 38940]]

Paperwork Reduction Act of 1995

    This rule implements Public Law 114-113 which reauthorizes the 
September 11th Victim Compensation Fund of 2001. In order to be able to 
evaluate claims and provide compensation, the Fund will need to collect 
information from an individual (or a personal representatives of a 
deceased individual) who suffered physical harm or was killed as a 
result of the terrorist-related aircraft crashes of September 11, 2001 
or the debris removal efforts that took place in the immediate 
aftermath of those crashes. Accordingly, the Department of Justice, 
Civil Division will submit an information collection request to the 
Office of Management and Budget (OMB) for review and clearance in 
accordance with the emergency review procedures of the Paperwork 
Reduction Act of 1995. This request will seek reinstatement of the 
prior information collection authorized under Public Law 111-347. The 
Department has also published a Notice in the Federal Register 
soliciting public comment on the information collection associated with 
this rulemaking. 81 FR 20674 (April 8, 2016).

Regulatory Flexibility Act

    These regulations set forth procedures by which the Federal 
government will award compensation benefits to eligible victims of the 
September 11, 2001 terrorist attacks. Under 5 U.S.C. 601(6), the term 
``small entity'' does not include the Federal government, the party 
charged with incurring the costs attendant to the implementation and 
administration of the Victim Compensation Fund. Because this rule is 
being adopted as an interim final rule, a Regulatory Flexibility 
analysis is not required. This rule provides compensation to 
individuals, not to entities.

Executive Orders 12866 and 13563--Regulatory Review

    This regulation has been drafted and reviewed in accordance with 
Executive Order 12866, ``Regulatory Planning and Review'' section 1(b), 
Principles of Regulation and in accordance with Executive Order 13563 
``Improving Regulation and Regulatory Review'' section 1(b) General 
Principles of Regulation. The Department of Justice has determined that 
this rule is an ``economically significant regulatory action'' under 
Executive Order 12866, section 3(f), Regulatory Planning and Review, 
and accordingly this rule has been reviewed by the Office of Management 
and Budget. Further, both Executive Orders 12866 and 13563 direct 
agencies to assess all costs and benefits of available regulatory 
alternatives and, if regulation is necessary, to select regulatory 
approaches that maximize net benefits (including potential economic, 
environmental, public health and safety effects, distributive impacts, 
and equity). Executive Order 13563 emphasizes the importance of 
quantifying both costs and benefits, of reducing costs, of harmonizing 
rules, and of promoting flexibility. The Department has assessed the 
costs and benefits of this regulation and believes that the regulatory 
approach selected maximizes net benefits. As is described more fully in 
the next paragraph, the economic impact of the rule is a transfer of 
the funds that are being allocated by the Federal government to any 
individual (or a personal representative of a deceased individual) who 
suffered physical harm or was killed as a result of the terrorist-
related aircraft crashes of September 11, 2001, or the rescue and 
recovery efforts during the immediate aftermath of such crashes or the 
debris removal efforts that took place in the immediate aftermath of 
those crashes.
Assessment of Benefits, Costs, and Alternatives
    As required by Executive Order 13563 and Executive Order 12866 for 
economically significant regulatory actions, the Department has 
assessed the benefits and costs anticipated from this rulemaking and 
considered whether there are reasonably feasible alternatives to this 
rulemaking, including considering whether there are reasonably viable 
non-regulatory actions that could be taken in lieu of this rulemaking. 
The purpose of this rulemaking is to provide the legal and 
administrative framework necessary to provide compensation to any 
individual (or a personal representative of a deceased individual) who 
suffered physical harm or was killed as a result of the terrorist-
related aircraft crashes of September 11, 2001 or the debris removal 
efforts that took place in the immediate aftermath of those crashes, as 
provided by Title II of the Zadroga Act and the Reauthorized Zadroga 
Act. The primary benefits and costs of this rulemaking are both set by 
statute as Congress has appropriated a capped amount for this program--
an initial $2.775 billion payable under the Zadroga Act and an 
additional $4.6 billion under the Reauthorized Zadroga Act. Because the 
$7.375 billion appropriated by Congress for the Fund must pay for 
claimant awards as well as the Fund's administrative expenses, it is 
important for the Fund to establish procedures to screen out ineligible 
or inappropriate claims while keeping administrative expenses as low as 
possible consistent with the goal of ensuring that funds are not 
diverted to processing ineligible claims in order to maximize the 
amount of funds available for claimants. Finally, based on past 
practice with the operation of the original Fund and the reopened Fund 
and the necessity to establish the legal and administrative framework 
for the reauthorized Fund, the Department concludes that there are no 
viable non-regulatory actions that it could take to implement the 
Reauthorized Zadroga Act in a fair and efficient manner.
Time Period for Public Comment
    This interim final rule provides for a 30-day public comment period 
after publication. The rule is an interpretive rule that merely 
clarifies or explains the statute or that sets out procedural rules or 
general statements of policy. Therefore, an extended period of public 
comment is not necessary. A 30-day comment period will afford the 
public a meaningful opportunity to comment on the interim final rule.

Executive Order 13132--Federalism

    This regulation will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or on distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with Executive 
Order 13132, it is determined that this rule does not have sufficient 
federalism implications to warrant the preparation of a Federalism 
Assessment. However, the Department of Justice has worked cooperatively 
with state and local officials in the affected communities in the 
preparation of this rule. Also, the Department individually notified 
national associations representing elected officials regarding this 
rulemaking.

Executive Order 12988--Civil Justice Reform

    This regulation meets the applicable standards set forth in 
sections 3(a) and 3(b)(2) of Executive Order 12988.

Unfunded Mandates Reform Act of 1995

    This rule will not result in the expenditure by State, local and 
tribal governments, in the aggregate, or by the private sector, of 
$100,000,000 or more in any one year, and it will not significantly or 
uniquely affect small governments. Therefore, no actions were deemed 
necessary under the provisions

[[Page 38941]]

of the Unfunded Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is not a major rule as defined by section 804 of the 
Small Business Regulatory Enforcement Fairness Act of 1996. This rule 
will not result in an annual effect on the economy of $100,000,000 or 
more, a major increase in costs or prices, or significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based companies to 
compete with foreign- based companies in domestic and export markets.

List of Subjects in 28 CFR Part 104

    Disaster assistance, Disability benefits, Terrorism.


0
Accordingly, for the reasons set forth in the preamble, chapter I of 
Title 28 of the Code of Federal Regulations is amended by revising part 
104 to read as follows:

PART 104--SEPTEMBER 11TH VICTIM COMPENSATION FUND

Subpart A--General; Eligibility
Sec.
104.1 Purpose.
104.2 Eligibility definitions and requirements.
104.3 Other definitions.
104.4 Personal Representative.
104.5 Foreign claims.
104.6 Amendments to this part.
Subpart B--Filing for Compensation
104.21 Presumptively covered conditions.
104.22 Filing for compensation.
Subpart C--Claim Intake, Assistance, and Review Procedures
104.31 Procedure for claims evaluation.
104.32 Eligibility review.
104.33 Hearing.
104.34 Publication of awards.
104.35 Claims deemed abandoned by claimants.
Subpart D--Amount of Compensation for Eligible Claimants
104.41 Amount of compensation.
104.42 Applicable state law.
104.43 Determination of presumed economic loss for decedents.
104.44 Determination of presumed noneconomic losses for claims on 
behalf of decedents.
104.45 Determination of presumed economic loss for injured 
claimants.
104.46 Determination of presumed noneconomic losses for injured 
claimants.
104.47 Collateral sources.
Subpart E--Payment of Claims
104.51 Payments to eligible individuals.
104.52 Distribution of award to decedent's beneficiaries.
Subpart F--Limitations
104.61 Limitation on civil actions.
104.62 Time limit on filing claims.
104.63 Subrogation.
Subpart G--Measures To Protect the Integrity of the Compensation 
Program
104.71 Procedures to prevent and detect fraud.
Subpart H--Attorney Fees
104.81 Limitation on attorney fees.

    Authority: Title IV of Pub. L. 107-42, 115 Stat. 230, 49 U.S.C. 
40101 note; Title II of Pub. L. 111-347, 124 Stat. 3623; Title IV of 
Pub. L. 114-113, 129 Stat. 2242.

Subpart A--General; Eligibility


Sec.  104.1  Purpose.

    This part implements the provisions of the September 11th Victim 
Compensation Fund of 2001, Title IV of Public Law 107-42, 115 Stat. 230 
(Air Transportation Safety and System Stabilization Act), as amended by 
the James Zadroga 9/11 Health and Compensation Act of 2010, Title II of 
Public Law 111-347, and as amended by the James Zadroga 9/11 Victim 
Compensation Fund Reauthorization Act, Division O, Title IV of Public 
Law 114-113 (the ``Act'') to provide full compensation to eligible 
individuals who were physically injured (as defined herein) as a result 
of the terrorist-related aircraft crashes of September 11, 2001, or the 
rescue and recovery efforts during the immediate aftermath of such 
crashes or debris removal during the immediate aftermath of those 
crashes, and to the ``personal representatives'' of those who were 
killed as a result of the crashes or the rescue and recovery efforts 
during the immediate aftermath of such crashes or debris removal during 
the immediate aftermath of such crashes. All compensation provided 
through the Victim Compensation Fund will be on account of personal 
physical conditions, physical injuries or death. The provisions of 
these regulations that relate to filing and evaluation of claims, 
determination of eligibility, and determination of compensable loss 
shall apply to all claims that are defined as Group B claims in the Act 
and in these regulations. Eligibility and compensation for Group A 
claims has been determined prior to the effective date of these 
regulations, pursuant to the regulations previously in effect.


Sec.  104.2  Eligibility definitions and requirements.

    (a) Categories of claims--(1) Group A claims. A claim is a Group A 
claim if the Special Master has transmitted a final award determination 
by sending a letter postmarked and transmitted on or before December 
17, 2015 indicating the total amount of compensation to which the 
claimant is entitled for that claim, pursuant to the regulations and 
methodology in effect on December 17, 2015.
    (2) Group B claims. A claim is a Group B claim if it is not a Group 
A claim. An individual can have both Group A claims and Group B claims.
    (b) Eligible claimants. The term eligible claimants means:
    (1) Individuals present at a 9/11 crash site at the time of or in 
the immediate aftermath of the terrorist-related aircraft crashes and 
who suffered physical harm, as defined herein, as a direct result of 
the crashes or the rescue and recovery efforts or debris removal;
    (2) The Personal Representatives of deceased individuals aboard 
American Airlines flights 11 or 77 and United Airlines flights 93 or 
175; and
    (3) The Personal Representatives of individuals who were present at 
a 9/11 crash site at the time of or in the immediate aftermath of the 
crashes and who died as a direct result of the terrorist-related 
aircraft crash or the rescue and recovery efforts during the immediate 
aftermath of such crashes or the debris removal during the immediate 
aftermath of such crashes.
    (4) The term eligible claimants does not include any individual or 
representative of an individual who is identified to have been a 
participant or conspirator in the terrorist-related crashes of 
September 11.
    (c) Immediate aftermath. The term immediate aftermath means any 
period beginning with the terrorist-related aircraft crashes of 
September 11, 2001, and ending on May 30, 2002.
    (d) Physical harm. The term physical harm shall mean:
    (1) A WTC-Related Physical Health Condition; or
    (2) A physical injury to the body resulting from the 9/11 attacks 
that was treated by a medical professional within a reasonable time 
from the date of discovering such harm and is verifiable by medical 
records created by or at the direction of the medical professional who 
provided the medical care contemporaneously with the care; but
    (3) Not including any Mental Health Condition.
    (e) Mental Health Condition. The term Mental Health Condition shall 
mean a mental health condition described in paragraph (1)(A)(ii) or 
(3)(B) of section 3312(a) of the Public Health Service Act (42 U.S.C. 
300 mm-22(a)), or any mental health condition certified under section 
3312(b)(2)(B)(iii) of such Act (including

[[Page 38942]]

such certification as applied under section 3322(a) (42 U.S.C. 300mm-
32(a) of such Act), or a mental health condition described in section 
3322(b)(2) (42 U.S.C. 300mm-32(b)(2)) of such Act, or any other mental 
health condition.
    (f) Personal Representative. The term Personal Representative shall 
mean the person determined to be the Personal Representative under 
Sec.  104.4 of this part.
    (g) WTC Health Program. The term WTC Health Program means the World 
Trade Center Health Program established by Title I of Public Law 111-
347 (codified at Title XXXIII of the Public Health Service Act, 42 
U.S.C. 300mm through 300mm-61).
    (h) WTC Program Administrator. The WTC Program Administrator shall 
mean the WTC Program Administrator as defined in section 3306 of the 
Public Health Service Act (42 U.S.C. 300mm-5).
    (i) WTC-Related Physical Health Condition. The term WTC-Related 
Physical Health Condition means a WTC-related health condition listed 
in Section 3312(a) of the Public Health Service Act (42 U.S.C. 300mm-
22(a)), including the conditions listed in section 3322(b) of such Act 
(42 U.S.C. 300mm-32(b)), and including those health conditions added by 
the WTC Program Administrator through rulemaking pursuant to the Public 
Health Service Act, 42 CFR part 88, except that such term shall not 
include any Mental Health Condition.
    (j) 9/11 crash site. The term 9/11 crash site means:
    (1) The World Trade Center site, Pentagon site, and Shanksville, 
Pennsylvania site; or
    (2) The buildings or portions of buildings that were destroyed as a 
result of the terrorist-related airplane crashes of September 11, 2001; 
or
    (3) The area in Manhattan that is south of the line that runs along 
Canal Street from the Hudson River to the intersection of Canal Street 
and East Broadway, north on East Broadway to Clinton Street, and east 
on Clinton Street to the East River; and
    (4) Any area related to, or along, routes of debris removal, such 
as barges and Fresh Kills.


Sec.  104.3  Other definitions.

    (a) Beneficiary. The term beneficiary shall mean a person to whom 
the Personal Representative shall distribute all or part of the award 
under Sec.  104.52 of this part.
    (b) Dependents. The Special Master shall identify as dependents 
those persons so identified by the victim on his or her Federal tax 
return for the year prior to the year of the victim's death (or those 
persons who legally could have been identified by the victim on his or 
her Federal tax return for the year prior to the year of the victim's 
death) unless:
    (1) The claimant demonstrates that a minor child of the victim was 
born or adopted on or after January 1 of the year of the victim's 
death;
    (2) Another person became a dependent in accordance with then- 
applicable law on or after January 1 of the year of the victim's death; 
or
    (3) The victim was not required by law to file a Federal income tax 
return for the year prior to the year of the victim's death.
    (c) Spouse. The Special Master shall identify as the spouse of a 
victim the person reported as spouse on the victim's Federal tax return 
for the year prior to the year of the victim's death (or the person who 
legally could have been identified by the victim on his or her Federal 
tax return for the year prior to the year of the victim's death) 
unless:
    (1) The victim was married or divorced in accordance with 
applicable state law on or after January 1 of the year of the victim's 
death; or
    (2) The victim was not required by law to file a Federal income tax 
return for the year prior to the year of the victim's death.
    (3) The Special Master shall identify as the spouse of a victim any 
same-sex spouse who was lawfully married to the victim under applicable 
state law.
    (d) The Act. The Act, as used in this part, shall mean Public Law 
107-42, 115 Stat. 230 (``Air Transportation Safety and System 
Stabilization Act''), 49 U.S.C. 40101 note, as amended by the James 
Zadroga 9/11 Health and Compensation Act of 2010, Title II of Public 
Law 111-347 and as further amended by the James Zadroga 9/11 Victim 
Compensation Fund Reauthorization Act, Division O, Title IV of Public 
Law 114-113.
    (e) Victim. The term victim shall mean an eligible injured claimant 
or a decedent on whose behalf a claim is brought by an eligible 
Personal Representative.
    (f) Substantially Complete. A claim becomes substantially complete 
when, in the opinion of the Special Master or her designee, the claim 
contains sufficient information and documentation to determine both the 
claimant's eligibility and, if the claimant is eligible, an appropriate 
award.


Sec.  104.4  Personal Representative.

    (a) In general. The Personal Representative shall be:
    (1) An individual appointed by a court of competent jurisdiction as 
the Personal Representative of the decedent or as the executor or 
administrator of the decedent's will or estate.
    (2) In the event that no Personal Representative or executor or 
administrator has been appointed by any court of competent 
jurisdiction, and such issue is not the subject of pending litigation 
or other dispute, the Special Master may, in her discretion, determine 
that the Personal Representative for purposes of compensation by the 
Fund is the person named by the decedent in the decedent's will as the 
executor or administrator of the decedent's estate. In the event no 
will exists, the Special Master may, in her discretion, determine that 
the Personal Representative for purposes of compensation by the Fund is 
the first person in the line of succession established by the laws of 
the decedent's domicile governing intestacy.
    (b) Notice to beneficiaries. (1) Any purported Personal 
Representative must, before filing an Eligibility Form, provide written 
notice of the claim (including a designated portion of the Eligibility 
Form) to the immediate family of the decedent (including, but not 
limited to, the decedent's spouse, former spouses, children, other 
dependents, and parents), to the executor, administrator, and 
beneficiaries of the decedent's will, and to any other persons who may 
reasonably be expected to assert an interest in an award or to have a 
cause of action to recover damages relating to the wrongful death of 
the decedent.
    (2) Personal delivery or transmission by certified mail, return 
receipt requested, shall be deemed sufficient notice under this 
provision. The claim forms shall require that the purported Personal 
Representative certify that such notice (or other notice that the 
Special Master deems appropriate) has been given. In addition, as 
provided in Sec.  104.21(b)(5) of this part, the Special Master may 
publish a list of individuals who have filed Eligibility Forms and the 
names of the victims for whom compensation is sought, but shall not 
publish the content of any such form.
    (c) Objections to Personal Representatives. Objections to the 
authority of an individual to file as the Personal Representative of a 
decedent may be filed with the Special Master by parties who assert a 
financial interest in the award up to 30 days following the filing by 
the Personal Representative. If timely filed, such objections shall be 
treated as evidence of a ``dispute''

[[Page 38943]]

pursuant to paragraph (d) of this section.
    (d) Disputes as to identity. The Special Master shall not be 
required to arbitrate, litigate, or otherwise resolve any dispute as to 
the identity of the Personal Representative. In the event of a dispute 
over the appropriate Personal Representative, the Special Master may 
suspend adjudication of the claim or, if sufficient information is 
provided, calculate the appropriate award and authorize payment, but 
place in escrow any payment until the dispute is resolved either by 
agreement of the disputing parties or by a court of competent 
jurisdiction. Alternatively, the disputing parties may agree in writing 
to the identity of a Personal Representative to act on their behalf, 
who may seek and accept payment from the Fund while the disputing 
parties work to settle their dispute.


Sec.  104.5  Foreign claims.

    In the case of claims brought by or on behalf of foreign citizens, 
the Special Master may alter the requirements for documentation set 
forth herein to the extent such materials are unavailable to such 
foreign claimants.


Sec.  104.6  Amendments to this part.

    All claims will be processed in accordance with the current 
provisions of this part.

Subpart B--Filing for Compensation


Sec.  104.21  Presumptively covered conditions.

    (a) In general. The Special Master shall maintain and publish on 
the Fund's Web site a list of presumptively covered conditions that 
resulted from the terrorist-related air crashes of September 11, 2001, 
or rescue and recovery or debris removal efforts during the immediate 
aftermath of such crashes. The list shall consist of the WTC-Related 
Physical Health Conditions that resulted from the terrorist-related air 
crashes of September 11, 2001 or rescue and recovery or debris removal 
efforts during the immediate aftermath of such crashes. Group B claims 
shall be eligible for compensation only if the Special Master 
determines based on the evidence presented that a claimant who seeks 
compensation for physical harm has at least one WTC-Related Physical 
Health Condition, with respect to a deceased individual, the cause of 
such individual's death is determined at least in part to be 
attributable to a WTC-Related Physical Health Condition.
    (b) Updates. The Special Master shall update the list of 
presumptively covered conditions to conform to any changes in the WTC-
Related Physical Health Conditions. Claims may then be amended pursuant 
to Sec.  104.22(e)(ii).
    (c) Conditions other than presumptively covered conditions. A 
claimant may also be eligible for payment under Sec.  104.51 where the 
claimant has at least one WTC-Related Physical Health Condition and the 
Special Master determines that the claimant--
    (1) Has a physical injury to the body that resulted from the 
terrorist-related air crashes of September 11, 2001 or rescue and 
recovery or debris removal efforts during the immediate aftermath of 
such crashes or presents extraordinary circumstances; and
    (2) Is otherwise eligible for payment.


Sec.  104.22  Filing for compensation.

    (a) Compensation form; ``filing.'' A compensation claim shall be 
deemed ``filed'' for purposes of section 405(b)(3) of the Act 
(providing that the Special Master shall issue a determination 
regarding the matters that were the subject of the claim not later than 
120 calendar days after the date on which a claim is filed), and for 
any time periods in this part, when it is substantially complete.
    (b) Eligibility Form. The Special Master shall develop an 
Eligibility Form, which may be a portion of a complete claim form, that 
will require the claimant to provide information necessary for 
determining the claimant's eligibility to recover from the Fund.
    (1) The Eligibility Form may require that the claimant certify that 
he or she has dismissed any pending lawsuit seeking damages as a result 
of the terrorist-related airplane crashes of September 11, 2001, or for 
damages arising from or related to debris removal (except for actions 
seeking collateral source benefits) no later than January 2, 2011 and 
that there is no pending lawsuit brought by a dependent, spouse, or 
beneficiary of the victim.
    (2) The Special Master may require as part of the notice 
requirement pursuant to Sec.  104.4(b) that the Personal Representative 
of the deceased individual provide copies of a designated portion of 
the Eligibility Form to the immediate family of the decedent 
(including, but not limited to, the spouse, former spouses, children, 
other dependents, and parents), to the executor, administrator, and 
beneficiaries of the decedent's will, and to any other persons who may 
reasonably be expected to assert an interest in an award or to have a 
cause of action to recover damages relating to the wrongful death of 
the decedent.
    (3) The Eligibility Form may require claimants to provide the 
following proof:
    (i) Proof of death: Death certificate or similar official 
documentation;
    (ii) Proof of presence at site: Documentation sufficient to 
establish presence at a 9/11 crash site, which may include, without 
limitation, a death certificate, proof of residence, such as a lease or 
utility bill, records of employment or school attendance, 
contemporaneous medical records, contemporaneous records of federal, 
state, city or local government, a pay stub, official personnel roster, 
site credentials, an affidavit or declaration of the decedent's or 
injured claimant's employer, or other sworn statement (or unsworn 
statement complying with 28 U.S.C. 1746) regarding the presence of the 
victim;
    (iii) Proof of physical harm: Certification of a conclusion by the 
WTC Health Program that the claimant suffers from a WTC-Related 
Physical Health Condition and is eligible for treatment under the WTC 
Health Program, or verification by the WTC Program Administrator that 
the claimant suffers from a WTC-Related Physical Health Condition, or 
other credible medical records from a licensed medical professional.
    (iv) Personal Representative: Copies of relevant legal 
documentation, including court orders; letters testamentary or similar 
documentation; proof of the purported Personal Representative's 
relationship to the decedent; copies of wills, trusts, or other 
testamentary documents; and information regarding other possible 
beneficiaries as requested by the Eligibility Form;
    (v) Any other information that the Special Master deems necessary 
to determine the claimant's eligibility.
    (vi) The Special Master may also require waivers, consents, or 
authorizations from claimants to obtain directly from third parties tax 
returns, medical information, employment information, or other 
information that the Special Master deems relevant in determining the 
claimant's eligibility or award, and may request an opportunity to 
review originals of documents submitted in connection with the Fund.
    (vii) The Special Master may publish a list of individuals who have 
filed Eligibility Forms on behalf of a deceased victim and the names of 
the deceased victims for whom compensation is sought, but shall not 
publish the content of any such form.
    (c) Personal Injury Compensation Form and Death Compensation Form. 
The Special Master shall develop a Personal Injury Compensation Form,

[[Page 38944]]

which may be a portion of a complete claim form, that each injured 
claimant must submit. The Special Master shall also develop a Death 
Compensation Form, which may be a portion of a complete claim form, 
that each Personal Representative must submit. These forms shall 
require the claimant to provide certain information that the Special 
Master deems necessary to determining the amount of any award, 
including information concerning income, collateral sources, benefits, 
settlements and attorneys' fees relating to civil actions described in 
section 405(c)(3)(C)(iii) of the Act, and other financial information, 
and shall require the claimant to state the factual basis for the 
amount of compensation sought. It shall also allow the claimant to 
submit certain other information that may be relevant, but not 
necessary, to the determination of the amount of any award.
    (1) The Special Master may ask claimants to submit certain tax 
returns or tax transcripts for returns that the Special Master deems 
appropriate for determination of an award. The Special Master may also 
require waivers, consents, or authorizations from claimants to obtain 
directly from third parties medical information, employment 
information, or other information that the Special Master deems 
relevant to determining the amount of any award.
    (2) Claimants may attach to the `Personal Injury Compensation 
Form'' or ``Death Compensation Form'' any additional statements, 
documents or analyses by physicians, experts, advisors, or any other 
person or entity that the claimant believes may be relevant to a 
determination of compensation.
    (d) Submission of a claim. Section 405(c)(3)(C) of the Act provides 
that upon the submission of a claim under the Fund, the claimant waives 
the right to file a civil action (or to be a party to an action) in any 
Federal or State court for damages sustained as a result of the 
terrorist-related aircraft crashes of September 11, 2001, or debris 
removal, except for civil actions to recover collateral source 
obligations and civil actions against any person who is a knowing 
participant in any conspiracy to hijack any aircraft or commit any 
terrorist act. A claim shall be deemed submitted for purposes of 
section 405(c)(3)(C) of the Act when the Eligibility Form is deemed 
filed, regardless of whether any time limits are stayed or tolled.
    (e) Amendment of claims. A claimant who has previously submitted a 
claim may amend such claim to include:
    (1) An injury or loss that the claimant had not suffered (or did 
not reasonably know the claimant suffered) at the time the claimant 
filed the previous claim;
    (2) A condition that the Special Master has identified and 
published in accordance with 104.21(a), since the time the claimant 
filed the previous claim, as a presumptively covered condition;
    (3) An injury for which the claimant was previously compensated by 
the Fund, but only if that injury has substantially worsened, resulting 
in damages or loss that was not previously compensated.
    (f) Provisions of information by third parties. Any third party 
having an interest in a claim brought by a Personal Representative may 
provide written statements or information regarding the Personal 
Representative's claim. The Claims Evaluator or the Special Master or 
the Special Master's designee may, at his or her discretion, include 
the written statements or information as part of the claim.

Subpart C--Claim Intake, Assistance, and Review Procedures


Sec.  104.31  Procedure for claims evaluation.

    (a) Initial review. Claims Evaluators shall review the forms filed 
by the claimant and either deem the claim ``filed'' or notify the 
claimant of any deficiency in the forms or any required documents.
    (b) Procedure. The Claims Evaluator shall determine eligibility and 
the claimant's presumed award pursuant to Sec. Sec.  104.43 to 104.46 
of this part and notify the claimant in writing of the eligibility 
determination, or the amount of the presumed award as applicable, and 
the right to request a hearing before the Special Master or her 
designee under Sec.  104.33 of this part. After an eligible claimant 
has been notified of the presumed award, within 30 days the claimant 
may either accept the presumed compensation determination as the final 
determination and request payment, or may instead request a review 
before the Special Master or her designee pursuant to Sec.  104.33. 
Claimants found to be ineligible may appeal pursuant to Sec.  104.32.
    (c) Multiple claims from the same family. The Special Master may 
treat claims brought by or on behalf of two or more members of the same 
immediate family as related or consolidated claims for purposes of 
determining the amount of any award.


Sec.  104.32  Eligibility review.

    Any claimant deemed ineligible by the Claims Evaluator may appeal 
that decision to the Special Master or her designee by filing an 
eligibility appeal within 30 days on forms created by the office of the 
Special Master.


Sec.  104.33  Hearing.

    (a) Conduct of hearings. Hearings shall be before the Special 
Master or her designee. The objective of hearings shall be to permit 
the claimant to present information or evidence that the claimant 
believes is necessary to a full understanding of the claim. The 
claimant may request that the Special Master or her designee review any 
evidence relevant to the determination of the award, including without 
limitation: The nature and extent of the claimant's injury; evidence of 
the claimant's presence at a 9/11 crash site; factors and variables 
used in calculating economic loss; the identity of the victim's spouse 
and dependents; the financial needs of the claimant, facts affecting 
noneconomic loss; and any factual or legal arguments that the claimant 
contends should affect the award. Claimants shall be entitled to submit 
any statements or reports in writing. The Special Master or her 
designee may require authentication of documents, including medical 
records and reports, and may request and consider information regarding 
the financial resources and expenses of the victim's family or other 
material that the Special Master or her designee deems relevant.
    (b) Location and duration of hearings. The hearings shall, to the 
extent practicable, be scheduled at times and in locations convenient 
to the claimant or his or her representative. The hearings shall be 
limited in length to a time period determined by the Special Master or 
her designee.
    (c) Witnesses, counsel, and experts. Claimants shall be permitted, 
but not required, to present witnesses, including expert witnesses. The 
Special Master or her designee shall be permitted to question witnesses 
and examine the credentials of experts. The claimant shall be entitled 
to be represented by an attorney in good standing, but it is not 
necessary that the claimant be represented by an attorney. All 
testimony shall be taken under oath.
    (d) Waivers. The Special Master shall have authority and discretion 
to require any waivers necessary to obtain more individualized 
information on specific claimants.
    (e) Award Appeals. For award appeals, the Special Master or her 
designee shall make a determination whether:
    (1) There was an error in determining the presumptive award, either 
because

[[Page 38945]]

the claimant's individual criteria were misapplied or for another 
reason; or
    (2) The claimant presents extraordinary circumstances not 
adequately addressed by the presumptive award.
    (f) Determination. The Special Master shall notify the claimant in 
writing of the final amount of the award, but need not create or 
provide any written record of the deliberations that resulted in that 
determination. There shall be no further review or appeal of the 
Special Master's determination. In notifying the claimant of the final 
amount of the award, the Special Master may designate the portions or 
percentages of the final award that are attributable to economic loss 
and non-economic loss, respectively, and may provide such other 
information as appropriate to provide adequate guidance for a court of 
competent jurisdiction and a personal representative.


Sec.  104.34  Publication of awards.

    The Special Master reserves the right to publicize the amounts of 
some or all of the awards, but shall not publish the name of the 
claimants or victims that received each award. If published, these 
decisions would be intended by the Special Master as general guides for 
potential claimants and should not be viewed as precedent binding on 
the Special Master or her staff.


Sec.  104.35  Claims deemed abandoned by claimants.

    The Special Master and her staff will endeavor to evaluate promptly 
any information submitted by claimants. Nonetheless, it is the 
responsibility of the claimant to keep the Special Master informed of 
his or her current address and to respond within the duration of this 
program to requests for additional information. Claims outstanding 
because of a claimant's failure to complete his or her filings shall be 
deemed abandoned.

Subpart D--Amount of Compensation for Eligible Claimants


Sec.  104.41  Amount of compensation.

    As provided in section 405(b)(1)(B)(ii) of the Act, in determining 
the amount of compensation to which a claimant is entitled, the Special 
Master shall take into consideration the harm to the claimant, the 
facts of the claim, and the individual circumstances of the claimant. 
The individual circumstances of the claimant may include the financial 
needs or financial resources of the claimant or the victim's dependents 
and beneficiaries. As provided in section 405(b)(6) of the Act, the 
Special Master shall reduce the amount of compensation by the amount of 
collateral source compensation the claimant (or, in the case of a 
Personal Representative, the victim's beneficiaries) has received or is 
entitled to receive as a result of the terrorist- related aircraft 
crashes of September 11, 2001. In no event shall a Group B claim 
receive an amount of compensation that is greater than the amount of 
loss determined pursuant to these regulations less the amount of any 
collateral source compensation that the claimant has received or is 
entitled to receive for such claim as a result of the terrorist related 
aircraft crashes of September 11, 2001 for the Group B claim.


Sec.  104.42  Applicable state law.

    The phrase ``to the extent recovery for such loss is allowed under 
applicable state law,'' as used in the statute's definition of economic 
loss in section 402(5) of the Act, is interpreted to mean that the 
Special Master is not permitted to compensate claimants for those 
categories or types of economic losses that would not be compensable 
under the law of the state that would be applicable to any tort claims 
brought by or on behalf of the victim.


Sec.  104.43  Determination of presumed economic loss for decedents.

    In reaching presumed determinations for economic loss for Personal 
Representatives bringing claims on behalf of eligible decedents, the 
Special Master shall consider sums corresponding to the following:
    (a) Loss of earnings or other benefits related to employment. The 
Special Master, as part of the process of reaching a ``determination'' 
pursuant to section 405(b) of the Act, has developed a methodology and 
may publish updated schedules, tables, or charts that will permit 
prospective claimants to estimate determinations of loss of earnings or 
other benefits related to employment based upon individual 
circumstances of the deceased victim, including: The age of the 
decedent as of the date of death; the number of dependents who survive 
the decedent; whether the decedent is survived by a spouse; and the 
amount and nature of the decedent's income for recent years. The 
decedent's salary/income in the three years preceding the year of death 
(or for other years the Special Master deems relevant) shall be 
evaluated in a manner that the Special Master deems appropriate. The 
Special Master may, if she deems appropriate, take an average of income 
figures for the three years preceding the year of death, and may also 
consider income for other periods that she deems appropriate, including 
published pay scales for victims who were government or military 
employees. In computing any loss of earnings due to physical harm as 
defined herein the Special Master shall, for each year for which any 
loss of earnings or other benefits related to employment is computed, 
limit the annual past or projected future gross income of the decedent 
to an amount that is not greater than $200,000. For purposes of the 
computation of loss of earnings, annual gross income shall have the 
meaning given such term in section 61 of the Internal Revenue Code of 
1986. In cases where the victim was a minor child, the Special Master 
may assume an average income for the child commensurate with the 
average income of all wage earners in the United States. For victims 
who were members of the armed services or government employees such as 
firefighters or police officers, the Special Master may consider all 
forms of compensation (or pay) to which the victim was entitled. For 
example, military service members' and uniformed service members' 
compensation includes all of the various components of compensation, 
including, but not limited to, basic pay (BPY), basic allowance for 
housing (BAH), basic allowance for subsistence (BAS), federal income 
tax advantage (TAD), overtime bonuses, differential pay, and longevity 
pay.
    (b) Medical expense loss. This loss equals the documented past out-
of-pocket medical expenses that were incurred as a result of the 
eligible physical harm suffered by the decedent (i.e., those medical 
expenses that were not paid for or reimbursed through health insurance 
or other programs). This loss shall be calculated on a case-by-case 
basis, using documentation and other information submitted by the 
Personal Representative. The Special Master shall not consider any 
future medical expense loss.
    (c) Replacement services loss. For decedents who did not have any 
prior earned income, or who worked only part-time outside the home, 
economic loss may be determined with reference to replacement services 
and similar measures.
    (d) Loss due to death/burial costs. This loss shall be calculated 
on a case- by-case basis, using documentation and other information 
submitted by the personal representative and includes the out-of-pocket 
burial costs that were incurred.
    (e) Loss of business or employment opportunities. Such losses shall 
be addressed through the procedure

[[Page 38946]]

outlined above in paragraph (a) of this section.


Sec.  104.44  Determination of presumed noneconomic losses for death 
for claims on behalf of decedents.

    The presumed non-economic losses for an eligible death shall be 
$250,000 plus an additional $100,000 for the spouse and each dependent 
of the deceased victim. Such presumed losses include a noneconomic 
component of replacement services loss.


Sec.  104.45  Determination of presumed economic loss for injured 
claimants.

    In reaching presumed determinations for economic loss for claimants 
who suffered an eligible physical harm (but did not die), the Special 
Master shall consider sums corresponding to the following:
    (a) Loss of earnings or other benefits related to employment. The 
Special Master may determine the loss of earnings or other benefits 
related to employment on a case-by-case basis, using documentation and 
other information submitted by the claimant, regarding the actual 
amount of work that the claimant has missed or will miss without 
compensation. Alternatively, the Special Master may determine the loss 
of earnings or other benefits related to employment by relying upon the 
methodology created pursuant to Sec.  104.43(a) and adjusting the loss 
based upon the extent of the victim's physical harm. In determining or 
computing any loss of earnings due to eligible physical harm, the 
Special Master shall, for each year of any past or projected future 
loss of earnings or other benefits related to employment, limit the 
annual gross income of the claimant to an amount that is not greater 
than $200,000. For purposes of the computation of loss of earnings, 
annual gross income shall have the meaning given such term in section 
61 of the Internal Revenue Code of 1986.
    (1) Disability; in general. In evaluating claims of disability, the 
Special Master will, in general, make a determination regarding whether 
the claimant is capable of performing his or her usual profession in 
light of the eligible physical conditions. The Special Master may 
require that the claimant submit an evaluation of the claimant's 
disability and ability to perform his or her occupation prepared by 
medical experts.
    (2) Total permanent disability. With respect to claims of total 
permanent disability, the Special Master may accept a determination of 
disability made by the Social Security Administration as evidence of 
disability without any further medical evidence or review. The Special 
Master may also consider determinations of permanent total disability 
made by other governmental agencies or private insurers in evaluating 
the claim.
    (3) Partial disability. With respect to claims of partial 
disability, the Special Master may consider evidence of the effect of 
the partial disability on the claimant's ability to perform his or her 
usual occupation as well as the effect of the partial disability on the 
claimant's ability to participate in usual daily activities.
    (b) Medical Expense Loss. This loss equals the documented past out-
of-pocket medical expenses that were incurred as a result of the 
physical harm suffered by the victim (i.e., those medical expenses that 
were not paid for or reimbursed through health insurance or other 
programs). The Special Master shall not consider any future medical 
expense loss.
    (c) Replacement Services. For claimants who suffer physical harm 
and did not have any prior earned income or who worked only part time 
outside the home, economic loss may be determined with reference to 
replacement services and similar measures.
    (d) Loss of business or employment opportunities. Such losses shall 
be addressed through the procedure outlined above in paragraph (a) of 
this section.
    (e) Determination of Noneconomic Loss for Claimants Who Have a WTC-
Related Physical Condition and Who Are Found Eligible for Economic 
Loss. The Special Master shall determine the appropriate noneconomic 
loss for such claimants in accordance with the provisions of Sec.  
104.46, taking into account the extent of disability, and may consider 
whether the claimant has multiple WTC-Related Physical Health 
Conditions that contribute to the disability.


Sec.  104.46  Determination of presumed noneconomic losses for injured 
claimants

    The Special Master may determine the presumed noneconomic losses 
for claimants who suffered physical harm (but did not die) by relying 
upon the noneconomic losses described in Sec.  104.44 and adjusting the 
losses based upon the extent of the victim's physical harm. The 
presumed noneconomic loss for a claim based on any single type of 
cancer shall not exceed $250,000 and the presumed noneconomic loss for 
a claim based on any single type of non-cancer condition shall not 
exceed $90,000. Such presumed losses include any noneconomic component 
of replacement services loss. The Special Master has discretion to 
consider the effect of multiple cancer conditions or multiple cancer 
and non-cancer conditions in computing the total noneconomic loss.


Sec.  104.47  Collateral sources.

    (a) Payments that constitute collateral source compensation. The 
amount of compensation shall be reduced by all collateral source 
compensation the claimant has received or is entitled to receive as a 
result of the terrorist-related aircraft crashes of September 11, 2001, 
or debris removal in the immediate aftermath, including life insurance, 
pension funds, death benefits programs, payments by Federal, State, or 
local governments related to the terrorist- related aircraft crashes of 
September 11, 2001, or debris removal and payments made pursuant to the 
settlement of a civil action as described in section 405(c)(3)(C)(iii) 
of the Act. In determining the appropriate collateral source offset for 
future benefit payments, the Special Master may employ an appropriate 
methodology for determining the present value of such future benefits. 
In determining the appropriate value of offsets for pension funds, life 
insurance and similar collateral sources, the Special Master may, as 
appropriate, reduce the amount of offsets to take account of self- 
contributions made or premiums paid by the victim during his or her 
lifetime. In determining the appropriate collateral source offset for 
future benefit payments that are contingent upon one or more future 
event(s), the Special Master may reduce such offsets to account for the 
possibility that the future contingencies may or may not occur. In 
cases where the recipients of collateral source compensation are not 
beneficiaries of the awards from the Fund, the Special Master shall 
have discretion to exclude such compensation from the collateral source 
offset where necessary to prevent beneficiaries from having their 
awards reduced by collateral source compensation that they will not 
receive.
    (b) Payments that do not constitute collateral source compensation. 
The following payments received by claimants do not constitute 
collateral source compensation:
    (1) The value of services or in-kind charitable gifts such as 
provision of emergency housing, food, or clothing; and
    (2) Charitable donations distributed to the beneficiaries of the 
decedent, to the injured claimant, or to the beneficiaries of the 
injured claimant by privately funded charitable entities; provided

[[Page 38947]]

however, that the Special Master may determine that funds provided to 
victims or their families through a privately funded charitable entity 
constitute, in substance, a payment described in paragraph (a) of this 
section.
    (3) Tax benefits received from the Federal government as a result 
of the enactment of the Victims of Terrorism Tax Relief Act.

Subpart E--Payment of Claims


Sec.  104.51  Payments to eligible individuals.

    (a) Payment date. Subject to paragraph (c) of this section, the 
Special Master shall authorize payment of an award to a claimant not 
later than 20 days after the date on which:
    (1) The claimant accepts the presumed award; or
    (2) A final award for the claimant is determined after a hearing on 
appeal.
    (b) Failure to accept or appeal presumed award. If a claimant fails 
to accept or appeal the presumed award determined for that claimant 
within 30 days, the presumed award shall be deemed to have been 
accepted and all rights to appeal the award shall have been waived.
    (c) Payment of Group A claims. Group A claims shall be paid as soon 
as practicable from the capped amount appropriated for such claims of 
$2,775,000,000.
    (d) Payment of Group B claims. Group B claims may be paid after the 
date on which new Group B claims may be filed under these regulations 
from the amount appropriated for Group A claims if and to the extent 
that there are funds remaining after all Group A claims have been paid 
and, thereafter, from the $4,600,000,000 amount appropriated 
specifically for Group B claims once it becomes available in fiscal 
year 2017 until expended.
    (e) Prioritization. The Special Master shall identify claims that 
present the most debilitating physical conditions and shall prioritize 
the compensation of such claims so that claimants with such 
debilitating conditions are not unduly burdened.
    (f) Reassessment. Commencing on December 18, 2017, and continuing 
at least annually thereafter until the closure of the Victim 
Compensation Fund, the Special Master shall review and reassess 
policies and procedures and make such adjustments as may be necessary 
to ensure that the total expenditures including administrative costs in 
providing compensation for claims in Group B do not exceed the funds 
deposited into the Victim Compensation Fund and to ensure that the 
compensation of those claimants who suffer from the most debilitating 
physical conditions is prioritized to avoid undue burden on such 
claimants.


Sec.  104.52  Distribution of award to decedent's beneficiaries.

    The Personal Representative shall distribute the award in a manner 
consistent with the law of the decedent's domicile or any applicable 
rulings made by a court of competent jurisdiction. The Special Master 
may require the Personal Representative to provide to the Special 
Master a plan for distribution of any award received from the Fund 
before payment is authorized. Notwithstanding any other provision of 
these regulations or any other provision of state law, in the event 
that the Special Master concludes that the Personal Representative's 
plan for distribution does not appropriately compensate the victim's 
spouse, children, or other relatives, the Special Master may direct the 
Personal Representative to distribute all or part of the award to such 
spouse, children, or other relatives.

Subpart F--Limitations


Sec.  104.61  Limitation on civil actions.

    (a) General. Section 405(c)(3)(C) of the Act provides that upon the 
submission of a claim under the Fund, the claimant waives the right to 
file a civil action (or be a party to an action) in any Federal or 
State court for damages sustained as a result of the terrorist-related 
aircraft crashes of September 11, 2001, or for damages arising from or 
related to debris removal, except that this limitation does not apply 
to recover collateral source obligations, or to a civil action against 
any person who is a knowing participant in any conspiracy to hijack any 
aircraft or commit any terrorist act. The Special Master shall take 
appropriate steps to inform potential claimants of section 405(c)(3)(C) 
of the Act.
    (b) Pending actions. Claimants who have filed a civil action or who 
are a party to such an action as described in paragraph (a) of this 
section may not file a claim with the Special Master unless they 
withdraw from such action not later than January 2, 2012.
    (c) Settled actions. In the case of an individual who settled a 
civil action described in Section 405(c)(3)(C) of the Act, such 
individual may not submit a claim under this title unless such action 
was commenced after December 22, 2003, and a release of all claims in 
such action was tendered prior to January 2, 2011.


Sec.  104.62  Time limit on filing claims.

    (a) In general. Group B claims. Group B claims that were not 
submitted to the Victim Compensation Fund on or before December 17, 
2015 may be filed by an individual (or by a personal representative on 
behalf of a deceased individual) during the period beginning on June 
15, 2016, and ending on December 18, 2020. Notwithstanding the above, 
an individual who intends to file a Group B claim must register with 
the Victim Compensation Fund in accordance with the following:
    (1) In the case that the individual knew (or reasonably should have 
known) before October 3, 2011, that the individual suffered a physical 
harm or died as a result of the terrorist-related aircraft crashes of 
September 11, 2001, or as a result of debris removal, and is eligible 
to file a claim under this part as of October 3, 2011, the individual 
or representative of such individual as appropriate may file a claim 
not later than October 3, 2013.
    (2) In the case that the individual first knew (or reasonably 
should have known) on or after October 3, 2011, that the individual 
suffered a physical harm or died or in the case that the individual 
became eligible to file a claim under this part on or after that date, 
the individual or representative of such individual as appropriate may 
file a claim not later than the last day of the 2-year period beginning 
on the date that the individual or representative first knew (or should 
have known) that the individual both suffered from such harm and was 
eligible to file a claim under this title, but in no event beyond 
December 18, 2020.
    (b) Determination by Special Master. The Special Master or the 
Special Master's designee should determine the timeliness of all claims 
under paragraph of this section.


Sec.  104.63  Subrogation.

    Compensation under this Fund does not constitute the recovery of 
tort damages against a third party nor the settlement of a third party 
action, and the United States shall be subrogated to all potential 
claims against third party tortfeasors of any victim receiving 
compensation from the Fund. For that reason, no person or entity having 
paid other benefits or compensation to or on behalf of a victim shall 
have any right of recovery, whether through subrogation or otherwise, 
against the compensation paid by the Fund.

[[Page 38948]]

Subpart G--Measures To Protect the Integrity of the Compensation 
Program


Sec.  104.71  Procedures to prevent and detect fraud.

    (a) Review of claims. For the purpose of detecting and preventing 
the payment of fraudulent claims and for the purpose of assuring 
accurate and appropriate payments to eligible claimants, the Special 
Master shall implement procedures to:
    (1) Verify, authenticate, and audit claims;
    (2) Analyze claim submissions to detect inconsistencies, 
irregularities, duplication, and multiple claimants; and
    (3) Ensure the quality control of claims review procedures.
    (b) Quality control. The Special Master shall institute periodic 
quality control audits designed to evaluate the accuracy of submissions 
and the accuracy of payments, subject to the oversight of the Inspector 
General of the Department of Justice.
    (c) False or fraudulent claims. The Special Master shall refer all 
evidence of false or fraudulent claims to appropriate law enforcement 
authorities.

Subpart H--Attorney Fees


Sec.  104.81  Limitation on attorney fees.

    (a) In general--(1) In general. Notwithstanding any contract, the 
representative of an individual may not charge, for services rendered 
in connection with the claim of an individual under this title, 
including expenses routinely incurred in the course of providing legal 
services, more than 10 percent of an award paid under this title on 
such claim. Expenses incurred in connection with the claim of an 
individual in this title other than those that are routinely incurred 
in the course of providing legal services may be charged to a claimant 
only if they have been approved by the Special Master.
    (2) Certification. In the case of any claim in connection with 
which services covered by this section were rendered, the 
representative shall certify his or her compliance with this section 
and shall provide such information as the Special Master requires to 
ensure such compliance.
    (b) Limitation--(1) In general. Except as provided in paragraph 
(b)(2) of this section, in the case of an individual who was charged a 
legal fee in connection with the settlement of a civil action described 
in section 405(c)(3)(C)(iii) of the Act, the representative who charged 
such legal fee may not charge any amount for compensation for services 
rendered in connection with a claim filed by or on behalf of that 
individual under this title.
    (2) Exception. If the legal fee charged in connection with the 
settlement of a civil action described in section 405(c)(3)(C)(iii) of 
the Act of an individual is less than 10 percent of the aggregate 
amount of compensation awarded to such individual through such 
settlement, the representative who charged such legal fee to that 
individual may charge an amount for compensation for services rendered 
to the extent that such amount charged is not more than Ten (10) 
percent of such aggregate amount through the settlement, minus the 
total amount of all legal fees charged for services rendered in 
connection with such settlement.
    (c) Discretion to lower fee. In the event that the Special Master 
finds that the fee limit set by paragraph (a) or (b) of this section 
provides excessive compensation for services rendered in connection 
with such claim, the Special Master may, in the discretion of the 
Special Master, award as reasonable compensation for services rendered 
an amount lesser than that permitted for in paragraph (a) of this 
section.

    Dated: June 13, 2016.
Sheila L. Birnbaum,
Special Master.
[FR Doc. 2016-14259 Filed 6-13-16; 4:15 pm]
BILLING CODE 4410-12-P