Custom Federal Regulations Service™

**This is supplemental material**

**for Book G of your set of**

**Federal Regulations**

Title 38, Part 21

*Vocational Rehabilitation and Education*

**Veterans Benefits Administration**

Supplement No. 67

Covering period of *Federal Register* issues

through December 20, 2004

Copyright © 2004 Jonathan Publishing

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Copyright © 2004 Jonathan Publishing

> **GENERAL INSTRUCTIONS**

Custom Federal Regulations Service™

**Supplemental Materials for *Book G***

**Code of Federal Regulations**

**Title 38, Part 21**

***Vocational Rehabilitation and Education***

**Veterans Benefits Administration**

**Supplement No. 67**

25 December 2004

Covering the period of Federal Register issues

through December 20, 2004

When **Book G** was originally prepared, it was current through final
regulations published in the *Federal Register* of 25 February 1992.
These supple­mental materials are designed to keep your regulations up to
date. You should file the attached pages immediately, and record the
fact that you did so on the *Supplement Filing Record* which is at page
G-8 of Book G, *Vocational Rehabilitation and Education*.

> **To ensure accuracy and timeliness of your materials,**
>
> **it is important that you follow these simple procedures:**
>
> 1\. Always file your supplemental materials immediately upon receipt.
>
> 2\. Before filing, always check the Supplement Filing Record (page
> G-8) to be sure that all prior supplements have been filed. If you are
> missing any supple­ments, contact the Veterans Benefits Administration
> at the address listed on page G-2.
>
> 3\. After filing, enter the relevant information on the Supplement
> Filing Record sheet (page G-8)---the date filed, name/initials of
> filer, and date through which the *Federal Register* is covered.
>
> 4\. If as a result of a failure to file, or an undelivered supplement,
> you have more than one supplement to file at a time, be certain to
> file them in chronological order, lower number first.
>
> 5\. Always retain the filing instructions (simply insert them at the
> back of the book) as a backup record of filing and for reference in
> case of a filing error.
>
> 6\. Be certain that you *permanently discard* any pages indicated for
> removal in the filing instructions in order to avoid confusion later.

To execute the filing instructions, simply remove *and throw away* the
pages listed under *Remove These Old Pages,* and replace them in each
case with the corres­pond­ing pages from this supplement listed under *Add
These New Pages*. Occasionally new pages will be added without removal
of any old material (reflecting new regulations), and occasionally old
pages will be removed with­out addition of any new material (reflecting
rescinded regulations)---in these cases the word *None* will appear in
the appropriate column.

# FILING INSTRUCTIONS

**Book G, Supplement No. 67**

**December 25, 2004**

*Remove these Add these Section(s)*

*[old pages]{.underline} [new pages]{.underline} [Affected]{.underline}*

**Do not file this supplement until you confirm that all prior
supplements have been filed**

> 21.7136-2 to 21.7137-9 21.7136-2 to [21.7137-5]{.underline}
> §§21.7136--21.7137

**Be sure to complete the**

***Supplement Filing Record* (page G-8)**

**when you have finished filing this material.**

> **HIGHLIGHTS**

**Book G, Supplement No. 67**

**December 25, 2004**

***Supplement* Highlights *references***: Where substantive changes are
made in the text of regulations, the paragraphs of *Highlights* sections
are cited at the end of the relevant section of text. Thus, if you are
reading §3.263, you will see a note at the end of that section which
reads: "Supplement *Highlights* references---6(2)." This means that
paragraph 2 of the *Highlights* section in Supplement No. 6 contains
information about the changes made in §3.263. By keeping and filing the
*Highlights* sections, you will have a reference source explaining all
substantive changes in the text of the regulations.

***Supplement frequency***: This Book G (*Rehabilitation and Education*)
was originally supplemented six times a year, in February, April, June,
August, October, and December. Beginning 1 August 1995, supplements will
be issued *every month* during which a final rule addition or
modification is made to the parts of Title 38 covered by this book.
Supplements will be numbered consecutively as issued.

**Modifications in this supplement include the following:**

1\. On 15 December 2004, the VA published a final rule, effective that
same date, to adjust the monthly rates of basic educational assistance
payable under the Montgomery GI Bill--Active Duty program for Fiscal
Year 2005 (October 1, 2004, through September 30, 2005) to show a 2%
increase in these rates. Changes:

> • In §21.7136, removed paragraphs (b)(4)--(9) and (c)(4)--(9), and
> revised existing paragraphs (b)(1)--(3) and (c)(1)--(3); and
>
> • In §21.7137, removed paragraphs (a)(4)--(9), and revised existing
> paragraphs (a)(1)--(3) and (c).

\(b\) *Rates*.

\(1\) Except as elsewhere provided in this section or in §21.7139, the
monthly rate of basic educational assistance payable for training that
occurs after September 30, 2004, to a veteran whose service is described
in paragraph (a) of this section, is the rate stated in the following
table:

*Training Monthly rate*

> Full time\...\...\...\...\...\...\...\...\...\...\...\...\...
> \$1004.00
>
> 3/4
> time\...\...\...\...\...\...\...\...\...\...\...\...\...\...\...\...
> 753.00
>
> 1/2
> time\...\...\...\...\...\...\...\...\...\...\...\...\...\...\...\.....
> 502.00
>
> Less than 1/2 time but more than 1/4 502.00
>
> 1/4 time\...\...\...\...\...\...\...\...\...\...\...\...\...\.....
> 251.00

(Authority: 38 U.S.C. 3015.)

\(2\) If a veteran's service is described in paragraph (a) of this
section, the monthly rate of basic educational assistance payable to the
veteran for pursuit of apprenticeship or other on-the-job training that
occurs after September 30, 2004, is the rate stated in the following
table:

*Training period Monthly rate*

> First six months of training\...\...\...\...\...\...\...\...\....
> \$753.00
>
> Second six months of training 552.20
>
> Remaining pursuit of training 351.40

(Authority: 38 U.S.C. 3015, 3032(c).)

\(3\) If a veteran's service is described in paragraph (a) of this
section, the monthly rate of basic educational assistance payable to the
veteran for pursuit of a cooperative course is \$1004.00 for training
that occurs after September 30, 2004. (Authority: 38 U.S.C. 3015.)

\(c\) *Rates for some veterans whose qualifying obligated period of
active duty is less than three years*. If a veteran has established
eligibility under §21.7042, but the veteran's service is not described
in paragraph (a)(2) of this section, the monthly rate of educational
assistance payable to the veteran will be determined by this paragraph.

\(1\) Except as elsewhere provided in this section or in §21.7139, the
monthly rate of basic educational assistance payable to a veteran for
training that occurs after September 30, 2004 is the rate stated in the
following table:

*Training Monthly rate*

> Full time\...\...\...\...\...\...\...\...\...\...\...\...\... \$816.00
>
> 3/4
> time\...\...\...\...\...\...\...\...\...\...\...\...\...\...\...\...
> 612.00
>
> 1/2
> time\...\...\...\...\...\...\...\...\...\...\...\...\...\...\...\.....
> 408.00
>
> Less than 1/2 time but more than 1/4 408.00
>
> 1/4 time or
> less\...\...\...\...\...\...\...\...\...\...\...\...\...\..... 204.00

(Authority: 38 U.S.C. 3015)

\(2\) The monthly rate of basic educational assistance payable to a
veteran for pursuit of apprenticeship or other on-the-job training that
occurs after September 30, 2004 is the rate stated in the following
table:

*Training period Monthly rate*

> First six months of training\...\...\...\...\...\...\...\...\....
> \$612.00
>
> Second six months of training 448.80
>
> Remaining pursuit of training 285.60

(Authority: 38 U.S.C. 3015, 3032(c).)

\(3\) The monthly rate of basic educational assistance payable to a
veteran for pursuit of a cooperative course is \$816.00 for training
that occurs after September 30, 2004. (Authority: 38 U.S.C. 3015.)

\(d\) *Increase in basic educational assistance rates* ("*kicker*"). The
Secretary concerned may increase the amount of basic educational
assistance payable to an individual who has a skill or specialty which
the Secretary concerned designates as having a critical shortage of
personnel or for which it is difficult to recruit. The amount of the
increase is set by the Secretary concerned, but (except as provided in
paragraphs (f) and (g) of this section):

\(1\) For individuals, other than those pursuing cooperative training
before October 9, 1996, or apprenticeship or other on-job training, it
may not exceed:

\(i\) \$400 per month for full-time training,

\(ii\) \$300 per month for three-quarter-time training,

\(iii\) \$200 per month for one-half-time training, or for training
which is less than one-half, but more than one-quarter-time, or

\(iv\) \$100 per month for one-quarter-time training or less.

\(2\) For individuals who first become members of the Armed Forces after
November 28, 1989 (other than those pursuing cooperative training before
October 9, 1996, or apprenticeship or other on-job training), it may not
exceed:

\(i\) \$700 per month for full-time training,

\(ii\) \$525 per month for three-quarter-time training,

\(iii\) \$350 per month for one-half-time training or for training which
is less than one-half, but more than one-quarter-time, or

\(iv\) \$175 per month for one-quarter-time training or less.

\(3\) For individuals who first become members of the Armed Forces
before November 29, 1989, and who are pursuing an apprenticeship or
other on-job training, it may not exceed:

\(i\) \$300 per month during the first six months of training,

\(ii\) \$220 per month during the second six months of training, and

\(iii\) \$140 per month during the remaining months of training.

\(4\) For individuals who first become members of the Armed Forces after
November 28, 1989, and who are pursuing an apprenticeship or other
on-job training, it may not exceed:

\(i\) \$525 per month during the first six months of training,

\(ii\) \$385 per month during the second six months of training, and

\(iii\) \$245 per month during the remaining months of training.

\(5\) For individuals who first become members of the Armed Forces
before November 29, 1989, and who are pursuing cooperative training, it
may not exceed \$320 per month for training received before October 9,
1996.

\(6\) For individuals who first become members of the Armed Forces after
November 28, 1989, and who are pursuing cooperative training, it may not
exceed \$560 per month for training received before October 9, 1996.
(Authority: §108(a)(2), Pub. L. 100-689, 102 Stat. 4170; §5(a), Pub. L.
102-83, 105 Stat. 406)

\(e\) *Less than one-half-time training and rates for servicemembers*.
Except as provided in paragraph (g) or (h) of this section, the monthly
rate for a veteran who is pursuing a course on a less than one-half-time
basis or the monthly rate for a servicemember who is pursuing a program
of education is the lesser of:

\(1\) The monthly rate stated in either paragraph (b) or (c) of this
section (as determined by the veteran's or servicemember's initial
obligated period of active duty) plus any additional amounts that may be
due under paragraph (d) or (e) of this section, or

\(2\) The monthly rate of the cost of the course. (Authority: 38 U.S.C.
3015, 3032)

\(f\) *Increase in basic educational assistance rates* ("*kicker*") *for
those eligible under §21.7045*. A veteran who formerly was eligible to
receive educational assistance under 38 U.S.C. ch. 32, and becomes
eligible for educational assistance under 38 U.S.C. ch. 30 as described
in §21.7045(b)(1)(ii), (c)(1)(ii), or (e)(2) may receive an increase in
basic educational assistance allowance (kicker). The increase will be
determined as follows.

\(1\) The basis of the increase will be that portion of the amount of
money:

\(i\) Which remains in the VEAP fund after the veteran has been paid all
assistance due him or her under 38 U.S.C. ch. 32 and refunded all of his
or her contributions to the VEAP fund, and

\(ii\) Which represents the Secretary of Defense's additional
contributions for the veteran as stated in §21.5132(b)(3) of this part.

\(2\) For a student pursuing a program of education by residence
training:

\(i\) VA will determine the monthly rate of the increase by dividing the
amount of money described in paragraph (e)(1) of this section by the
number of months of entitlement to educational assistance under 38
U.S.C. chapter 30 which the veteran has at the time his eligibility for
benefits under 38 U.S.C. chapter 30 is first established;

\(ii\) VA will use the monthly rate of the increase determined in
paragraph (e)(2)(i) of this section if the veteran is pursuing his or
her program full time;

\(iii\) VA will multiply the monthly rate determined by paragraph
(e)(2)(i) of this section by .75 for a student pursuing his or her
program three-quarter time;

\(iv\) VA will multiply the monthly rate determined by paragraph
(e)(2)(i) of this section by .5 for a student pursuing his or her
program half time; and

\(v\) VA will multiply the monthly rate determined by paragraph
(e)(2)(i) of this section by .25 for a student pursuing his or her
program less than one-half time.

\(3\) For a veteran pursuing cooperative training VA will multiply the
rate determined by paragraph (e)(2)(i) of this section by .8 for
training received before October 9, 1996.

\(4\) For a veteran pursuing a program of apprenticeship or other on-job
training VA will multiply the monthly rate determined by paragraph
(e)(2)(i) of this section:

\(i\) By .75 for a veteran in the first six months of pursuit of
training,

\(ii\) By .55 for a veteran in the second six months of pursuit of
training, and

\(iii\) By .35 for a veteran in the remaining months of pursuit of
training. (Authority: 38 U.S.C. 3015(e))

\(g\) *Increase* ("*kicker*") *in basic educational assistance rates
payable for service in the Selected Reserve*.

\(1\) The Secretary of the military department concerned may increase
the amount of basic educational assistance payable under paragraph (b),
(c), (d), (e), or (f) of this section, as appropriate. The increase
("kicker") is payable to a veteran who has a skill or specialty in which
there is a critical shortage of personnel or for which it is difficult
to recruit, or, in the case of critical units, retain personnel, if the
veteran:

> \(i\) Establishes eligibility for educational assistance under
> §21.7042(a) or §21.7045; and
>
> \(ii\) Meets the criteria of §21.7540(a)(1) with respect to service in
> the Selected Reserve.

\(2\) The Secretary of the military department concerned:

> \(i\) Will, for such an increase ("kicker"), set an amount of the
> increase ("kicker") for full-time training, but the increase
> ("kicker") may not exceed \$350 per month; and
>
> \(ii\) May set the amount of the increase ("kicker") payable, for a
> veteran pursuing a program of education less than full time or
> pursuing a program of apprenticeship or other on-job training, at an
> amount less than the amount described in paragraph (g)(2)(i) of this
> section. (Authority: 10 U.S.C. 16131(i)(2))

\(h\) *Increase in monthly rates due to contributions*. Effective May 1,
2001, a servicemember who establishes eligibility under §21.7042(a),
(b), or (c) may contribute up to \$600 to the Secretary of the military
department concerned in multiples of \$20.

\(1\) VA will increase the monthly rate provided in paragraph (b)(2) or
(c)(2) of this section by:

> \(i\) \$5 for every \$20 an individual pursuing a program of education
> full time has contributed;
>
> \(ii\) \$3.75 for every \$20 an individual pursuing a program of
> education three-quarter time has contributed;
>
> \(iii\) \$2.50 for every \$20 an individual pursuing a program of
> education half time or less than one-half time but more than
> one-quarter time has contributed; and
>
> \(iv\) \$1.25 for every \$20 an individual pursuing a program of
> education one-quarter time has contributed.

\(2\) If a veteran is pursuing an apprenticeship or other on-job
training:

\(i\) During the first six months of the veteran's pursuit of training,
VA will increase the monthly rate provided in paragraph (b)(4) or (c)(4)
of this section by \$3.75 for every \$20 the individual has contributed;

\(ii\) During the second six months of the veteran's pursuit of
training, VA will increase the monthly rate provided in paragraph (b)(4)
or (c)(4) of this section by \$2.75 for every \$20 the veteran has
contributed; and

\(iii\) During the remaining months of the veteran's pursuit of
training, VA will increase the monthly rate proved in paragraph (b)(4)
or (c)(4) of this section by \$1.75 for every \$20 the veteran has
contributed.

\(3\) VA will increase the monthly rate provided in paragraph
(b)(5)(iii) or (c)(5)(iii) of this section by \$5 for every \$20 the
veteran has contributed. (Authority: 38 U.S.C. 3015(g))

\[55 FR 28386, July 11, 1990, as amended at 55 FR 50324, Dec. 6, 1990;
56 FR 20135, May 2, 1991; 57 FR 11911, April 8, 1992; 57 FR 57104, Dec.
3, 1992; 59 FR 24053, May 10, 1994; 61 FR 6788, Feb. 22, 1996; 61 FR
15191, Apr. 5, 1996; 61 FR 24237, May 14, 1996; 62 FR 14824, Mar. 28,
1997; 62 FR 55519, Oct. 27, 1997; 62 FR 58655, Oct. 30, 1997; 64 FR
31694, June 14, 1999; 65 FR 44980, July 20, 2000; 65 FR 55193, Sept. 13,
2000; 66 FR 32228, June 14, 2001; 68 FR 34322, June 9, 2003; 68 FR
34331, June 9, 2003; 68 FR 37206, June 23, 2003; 69 FR 74978, Dec. 15,
2004\]

**Supplement *Highlights* references**: 12(3), 23(1), 25(2), 26(2),
30(1), 35(1, 3), 43(1), 51(1), 55(2), 62(1,2), 67(1).

Reserved

**§21.7137 Rates of payment of basic educational assistance for
individuals with remaining entitlement under 38 U.S.C. chapter 34.**

\(a\) *Minimum rates*.

\(1\) Except as elsewhere provided in this section, the monthly rate of
basic educational assistance for training that occurs after September
30, 2004 is the rate stated in the following table:

*Monthly Rate*

*Additional*

*Training No One Two for each*

*dependents dependent dependents additional*

*dependent*

Full-time \$1,192.00 \$1,228.00 \$1,259.00 \$16.00

3/4 time 894.50 921.00 944.50 12.00

1/2 time 596.00 614.00 629.50 8.50

Less than 1/2 but

more than 1/4 time 596.00 596.00 596.00 0

1/4 time or less 298.00 298.00 298.00 0

(Authority: 38 U.S.C. 3015)

\(2\) For veterans pursuing apprenticeship or other on-the-job training,
the monthly rate of basic educational assistance for training that
occurs after September 30, 2004 is the rate stated in the following
table:

*Monthly Rate*

*Additional*

*Training No One Two for each*

*dependents dependent dependents additional*

*dependent*

1st six months of pursuit

of program \$855.75 \$868.13 \$879.00 \$5.25

2nd six months of pursuit

of program 608.58 617.93 625.63 3.85

3rd six months of pursuit

of program 375.20 381.33 386.05 2.45

Remaining pursuit of program 363.30 369.08 374.33 2.45

(Authority: 38 U.S.C. 3015)

\(3\) The monthly rate of basic educational assistance payable to a
veteran who is pursuing a cooperative course after September 30, 2004,
is the rate stated in the following table:

*Additional for*

*each additional*

*No dependents One dependent Two dependents dependent*

\$1192.00 \$1228.00 \$1259.00 \$16.00

(Authority: 38 U.S.C. 3015)

\(b\) *Less than one-half-time training*. Except as provided in
paragraphs (d) and (e) of this section, the monthly rate of basic
educational assistance for a veteran who is pursuing a course on a less
than one-half-time basis is the lesser of:

\(1\) The monthly rate in paragraph (a)(1) of this section, or

\(2\) The monthly rate of the cost of the course. (Authority: 38 U.S.C.
3032; Pub. L. 98-525, Pub. L. 99-576)

\(c\) *Rates for servicemembers*. The monthly rate of basic educational
assistance for a servicemember may not exceed the lesser of the
following rates (except as provided in paragraph (d) of this section):

\(1\) The monthly pro-rated cost of the course.

\(2\) The following monthly rates for training that occurs after
September 30, 2004:

> \(i\) \$1,192.00 for full-time training;
>
> \(ii\) \$894.50 for three-quarter-time training;
>
> \(iii\) \$596.00 for one-half-time training and training that is less
> than one-half-time training but more than one-quarter-time training;
> and
>
> \(iv\) \$298.00 for one-quarter-time training. (Authority: 38 U.S.C.
> 3015.)

\(d\) *Increase in basic educational assistance rates (\"kicker'').* The
Secretary concerned may increase the amount of basic educational
assistance payable to an individual who has a skill or specialty which
the Secretary concerned designates as having a critical shortage of
personnel or for which it is difficult to recruit. The increase may not
be applied to a servicemember whose monthly rate is determined by
paragraph (c)(1) of this section, but it can serve to raise the ceiling
on monthly rates stated in paragraphs (b)(1) and (c)(2) of this section.
The amount of the increase is set by the Secretary concerned, but:

\(1\) For individuals, other than those pursuing cooperative training
before October 9, 1996, or apprenticeship or other on-job training, it
may not exceed:

\(i\) \$400 per month for full-time training,

\(ii\) \$300 per month for three-quarter-time training.

\(iii\) \$200 per month for one-half-time training or for training which
is less than one-half but more than one-quarter-time, or

\(iv\) \$100 per month for one-quarter-time training or less.

\(2\) For individuals pursuing an apprenticeship or other on-job
training it may not exceed:

\(i\) \$300 per month for the first six months of training.

\(ii\) \$220 per month for the second six months of training, and

\(iii\) \$140 per month for the remaining months of training.
(Authority: 38 U.S.C. 3015, 3032)

\(3\) For individuals pursuing cooperative training, it may not exceed
\$320 per month for training received before October 9, 1996.
(Authority: §108(a)(2), Pub. L. 100-689, 102 Stat. 4170; §5(a), Pub. L.
102-83, 105 Stat. 406)

\(e\) *Increase* ("*kicker*") *in basic educational assistance rates for
service in the Selected Reserve*.

\(1\) The Secretary of the military department concerned may increase
the amount of basic educational assistance payable under paragraph (a),
(b), or (d) of this section, as appropriate. The increase ("kicker") is
payable to a veteran who has a skill or specialty in which there is a
critical shortage of personnel or for which it is difficult to recruit,
or, in the case of critical units, retain personnel, if the veteran:

> \(i\) Establishes eligibility for educational assistance under
> §21.7044(a); and
>
> \(ii\) Meets the criteria of §21.7540(a)(1) with respect to service in
> the Selected Reserve.

\(2\) The Secretary of the military department concerned:

> \(i\) Will, for such an increase, set the amount of the increase
> ("kicker") payable for full-time training, but the increase ("kicker")
> may not exceed \$350 per month;
>
> \(ii\) May set the amount of the "kicker" payable, for a veteran
> pursuing a program of education less than full time or pursuing an
> apprenticeship or other on-job training, at an amount less than the
> amount described in paragraph (e)(2)(i) of this section. (Authority:
> 10 U.S.C. 16131(i)(2))

\(f\) *Concurrent benefits.* VA may pay additional educational
assistance to a veteran for a dependent concurrently with additional
pension or compensation for the same dependent. (Authority: 38 U.S.C.
3015(d), Pub. L. 98-525)

\(g\) *Two veteran cases*. VA may pay additional educational assistance
to a veteran for a spouse who is also a veteran. This will not bar the
payment of additional educational assistance or subsistence allowance
under §21.260 of this part to the spouse for the veteran. If the veteran
is paid additional educational assistance for a child, that will not bar
payment of additional educational assistance or subsistence allowance
under §21.260 of this part to the spouse for the same child. (Authority:
38 U.S.C. 3015(d); Pub. L. 98-525)

\[53 FR 1757, Jan. 22, 1988, as amended at 54 FR 34987, Aug. 23, 1989;
55 FR 28387, July 11, 1990; 56 FR 20135, May 2, 1991; 56 FR 31332, July
10, 1991; 57 FR 11911, April 8, 1992; 61 FR 6789, Feb. 22, 1996; 61 FR
15191, Apr. 5, 1996; 61 FR 24238, May 14, 1996; 62 FR 14825, Mar. 28,
1997; 62 FR 55519, Oct. 27, 1997; 62 FR 58655, Oct. 30, 1997; 63 FR
27854, Mar. 21, 1998; 64 FR 31694, June 14, 1999; 65 FR 44980, July 20,
2000; 65 FR 55193, Sept. 13, 2000; 66 FR 32229, June 14, 2001; 68 FR
34324, June 9, 2003; 69 FR 74978, Dec. 15, 2004\]

**Supplement *Highlights* references**: 23(1), 25(2), 26(2), 30(1),
35(1, 3), 38(2), 43(1), 51(1), 55(2), 62(1), 67(1).

Reserved