SECTION 1. MODIFICATION OF AUTHORITIES FOR STATE APPROVING AGENCIES.

    (a) Technical Amendment to Scope of Approval.--Section 3670 of 
title 38, United States Code, is amended--
            (1) by striking subsection (b); and
            (2) in subsection (a), by striking ``(a)''.
    (b) Modification of Provisions Relating to Approval of Courses.--
            (1) Modification of requirement that standards for programs 
        of apprenticeship be approved under the national apprenticeship 
        act.--Subsection (c)(1)(A) of section 3672 of such title is 
        amended by striking ``pursuant to section 2 of the Act of 
        August 16, 1937 (popularly known as the `National 
        Apprenticeship Act') (29 U.S.C. 50a),''.
            (2) Modification of requirement to promote development of 
        apprenticeship programs.--Subsection (d) of such section is 
        amended--
                    (A) in paragraph (1)--
                            (i) by striking ``and State approving 
                        agencies''; and
                            (ii) by striking ``shall utilize the 
                        services of'' and inserting ``may utilize the 
                        services of State approving agencies and''; and
                    (B) in paragraph (2), by striking ``shall'' and 
                inserting ``may''.
            (3) Modification of requirements relating to approval of 
        program of education exclusively by correspondence.--Subsection 
        (e) of such section is amended by striking ``only if'' and all 
        that follows through the period and inserting ``under such 
        criteria as the Secretary prescribes pursuant to section 
        3675.''.
    (c) Restatement of Requirement for Coordination of Approval 
Activities.--
            (1) In general.--Subsection (a) of section 3673 of such 
        title is amended to read as follows:
    ``(a) In General.--The Secretary shall take appropriate measures to 
ensure the coordination of approval activities performed by State 
approving agencies under this chapter and chapters 34 and 35 of this 
title and approval activities performed by the Department of Labor, the 
Department of Education, and other entities to reduce overlap and 
improve efficiency with respect to the activities.''.
            (2) Conforming amendments.--Such section is further 
        amended--
                    (A) in subsection (b), by inserting ``Furnishing 
                Materials.--'' before ``The Secretary''; and
                    (B) in the heading by striking ``Cooperation'' and 
                inserting ``Coordination of approval activities''.
            (3) Clerical amendment.--The table of sections at the 
        beginning of chapter 36 of such title is amended by striking 
        the item relating to section 3673 and inserting the following:

``3673. Coordination of approval activities.''.
    (d) Additional Discretion for the Secretary of Veterans Affairs for 
Reimbursing State Approving Agencies for Expenses.--Section 3674 of 
such title is amended to read as follows:
``Sec. 3674. Reimbursement of expenses
    ``(a) In General.--(1) Subject to subsections (b) and (c), the 
Secretary is authorized to enter into contracts or agreements with 
State and local agencies to pay such State and local agencies for 
reasonable and necessary expenses of salary and travel incurred by 
employees of such agencies and an allowance for administrative expenses 
in accordance with such criteria as the Secretary determines 
appropriate for activities performed pursuant to this chapter for 
purposes of chapters 30 through 35 of this title and chapters 1606 and 
1607 of title 10.
    ``(2) Each such contract or agreement shall be conditioned upon 
such terms and conditions as the Secretary determines appropriate for 
services performed pursuant to this chapter, including the condition 
that the State approving agency shall collect and report annually to 
the Secretary, the Committee on Veterans' Affairs of the Senate, and 
the Committee on Veterans' Affairs of the House of Representatives 
information on--
            ``(A) the amount of resources expended on such services 
        performed pursuant to that contract; and
            ``(B) the qualification and performance standards for State 
        approving agency personnel responsible for such services.
    ``(b) Source of Payments.--Subject to subsection (c), the Secretary 
shall make payments authorized under subsection (a) to State and local 
agencies first out of amounts available for the payment of readjustment 
benefits and then from other amounts made available to make the 
payments.
    ``(c) Limitation on Authorization of Appropriations.--(1) The total 
amount authorized and available under this section for any fiscal year 
may not exceed $19,000,000, except that the total amount made available 
for purposes of this section from amounts available for the payment of 
readjustment benefits may not exceed the following:
            ``(A) $19,000,000 for fiscal year 2007.
            ``(B) $13,000,000 for fiscal year 2008, and each subsequent 
        fiscal year.
    ``(2) For any fiscal year in which the total amount that would be 
made available under this section would exceed the amount applicable to 
that fiscal year under paragraph (1) except for the provisions of this 
subsection, the Secretary shall provide that each agency shall receive 
the same percentage of the amount applicable to that fiscal year under 
paragraph (1) as the agency would have received of the total amount 
that would have been made available without the limitation of this 
subsection.''.
    (e) Evaluations of Agency Performance; Qualifications and 
Performance of Agency Personnel.--Section 3674A of such title is 
amended--
            (1) by striking subsection (b);
            (2) in subsection (a), by striking ``(a)'';
            (3) by redesignating paragraphs (1), (2), (3), and (4) as 
        paragraphs (2), (3), (4), and (5), respectively;
            (4) by inserting before paragraph (2), as redesignated by 
        paragraph (3) of this subsection, the following new paragraph 
        (1):
            ``(1) establish performance measures--
                    ``(A) to assess the effectiveness of all services 
                for which a State approving agency is reimbursed 
                pursuant to section 3674 of this title that are based 
                on the outcomes of the services; and
                    ``(B) to assess the effectiveness of the State 
                approving agency in coordinating with other entities, 
                including the Department of Labor and the Department of 
                Education, to reduce overlap and improve efficiency in 
                approval activities;'';
            (5) by amending paragraph (2), as redesignated by paragraph 
        (3) of this subsection, to read as follows:
            ``(2) conduct an annual evaluation of each State approving 
        agency on the basis of the performance measures established 
        under paragraph (1);''; and
            (6) in paragraph (3), as redesignated by paragraph (3) of 
        this subsection, by striking ``under paragraph (1)'' and 
        inserting ``under paragraph (2)''.
    (f) Approval of Courses.--
            (1) In general.--Section 3675 of such title is amended to 
        read as follows:
``Sec. 3675. Approval of courses
    ``(a) Standards.--The Secretary shall establish standards of 
approval for accredited and nonaccredited courses offered by an 
educational institution that the Secretary determines are necessary to 
carry out the provisions of this chapter. Such standards shall be based 
on the following, as appropriate:
            ``(1) Student achievement.
            ``(2) Curricula, program objectives, and faculty.
            ``(3) Facilities, equipment, and supplies.
            ``(4) Institutional objectives, capacity, and 
        administration.
            ``(5) Student support services.
            ``(6) Recruiting and admissions practices.
            ``(7) Record of student complaints.
            ``(8) Process related requirements, such as application 
        requirements.
            ``(9) Such other criteria as the Secretary considers 
        appropriate.
    ``(b) Approval.--A State approving agency may approve courses 
offered by an educational institution when the standards established 
under subsection (a) have been satisfied by such educational 
institution. In performing such approval function, the State approving 
agency may, to the extent permitted by the Secretary, rely upon 
determinations made by other entities, including the Department of 
Labor and the Department of Education.
    ``(c) Disapproval.--Approval granted under this section may be 
revoked by the Secretary or a State approving agency under conditions 
established by the Secretary.''.
            (2) Conforming amendment.--Section 3452(h) of such title is 
        amended by striking ``an entrepreneurship course (as defined in 
        section 3675(c)(2) of this title)'' and inserting ``a non-
        degree, non-credit course of business education that enables or 
        assists a person to start or enhance a small business concern 
        (as defined pursuant to section 3(a) of the Small Business Act 
        (15 U.S.C. 362(a)))''.
            (3) Clerical amendment.--The table of sections at the 
        beginning of chapter 36 of such title is amended by striking 
        the item related to section 3675 and inserting the following 
        new item:

``3675. Approval of courses.''.
    (g) Modification of Provisions Relating to Approval of 
Nonaccredited Courses.--
            (1) In general.--Section 3676 of such title is repealed.
            (2) Conforming amendments.--(A) Section 3677 of such title 
        is redesignated as section 3676.
            (B) Section 3672(d)(1) of such title is amended by striking 
        ``sections 3677'' and inserting ``sections 3676''.
            (C) Section 3687(a)(2) of such title is amended by striking 
        ``section 3677'' and inserting ``section 3676''.
            (3) Clerical amendment.--The table of sections at the 
        beginning of chapter 36 of such title is amended by striking 
        the item relating to section 3676 and inserting the following:

``3676. Approval of training on the job.''.
    (h) Notice of Approval.--
            (1) In general.--Section 3678 of such title is amended to 
        read as follows:

``SEC. 3677. NOTICE OF DETERMINATIONS BY STATE APPROVING AGENCIES.

    ``A State approving agency shall provide to the Secretary, an 
educational institution, or such other entities as the Secretary 
considers appropriate such notification as the Secretary may consider 
necessary regarding determinations made by the State approving agency 
pursuant to section 3675 of this title.''.
            (2) Conforming amendment.--Section 3689(d) of such title is 
        amended by striking ``3678'' and inserting ``3677''.
            (3) Clerical amendment.--The table of sections at the 
        beginning of chapter 36 of such title is amended by striking 
        the items relating to section 3677 and 3678 and inserting the 
        following:

``3677. Notice of determinations by State approving agencies.''.
    (i) Modification of Provisions Relating to Disapproval of 
Courses.--
            (1) In general.--Section 3679 of such title is repealed.
            (2) Conforming amendment.--Section 3689(d) of such title is 
        amended by striking ``3679,''.
            (3) Clerical amendment.--The table of sections at the 
        beginning of chapter 36 of such title is amended by striking 
        the item relating to section 3679.
    (j) Effective Date.--The amendments made by this section shall take 
effect on the date that is one year after the date of the enactment of 
this section.
Revises provisions concerning Department of Veterans Affairs (VA) use of state approving agencies (agencies) for approving courses of education for veterans under the Montgomery GI Bill veterans' educational assistance program. Authorizes (current law requires) the Secretary of Veterans Affairs to promote the development of veterans' apprenticeship and on-job training programs. Authorizes the Secretary to determine the criteria and contract conditions for reimbursing agencies for salary and travel costs incurred on behalf of the VA, including the condition that the agencies report annually to the Secretary and the congressional veterans' committees on resources expended and personnel qualification and performance standards. Limits the annual authorized amount for the VA for such expenses.

Requires the Secretary to establish performance measures to assess the effectiveness of agencies in: (1) the services for which they are reimbursed; and (2) coordinating with other entities to reduce overlap and improve efficiency in approval activities.

Requires the Secretary to establish standards of approval for accredited and nonaccredited courses offered by an educational institution, based on specified measures. Authorizes an agency, in approving courses for which such standards have been met, to rely upon determinations made by other entities, including the Departments of Labor and Education. Allows approval to be revoked by the Secretary or the agency, under conditions established by the Secretary.
A bill to amend title 38, United States Code, to provide additional discretion to the Secretary of Veterans Affairs in contracting with State approving agencies, and for other purposes.