49–010 

Calendar No. 540 

109TH CONGRESS REPORT " ! SENATE 2d Session 109–297 

VETERANS’ CHOICE OF REPRESENTATION AND BENEFITS 

ENHANCEMENT ACT OF 2006 

JULY 27 (legislative day JULY 26), 2006.—Ordered to be printed 

Mr. CRAIG, from the Committee on Veterans’ Affairs, 

submitted the following 

R E P O R T 

[To accompany S. 2694] 

The Committee on Veterans’ Affairs (hereinafter, ‘‘Committee’’), 

to which was referred the bill (S. 2694), to amend title 38, United 

States Code, to remove certain limitations on attorney representation of claimants for veterans benefits in administrative proceedings before the Department of Veterans Affairs, and for other 

purposes, having considered the same, reports favorably thereon 

with an amendment in the nature of a substitute, and recommends 

that the bill, as amended, do pass. 

INTRODUCTION

On May 2, 2006, Committee Chairman Larry E. Craig introduced 

S. 2694, a bill to remove certain limitations on attorney representation of claimants for veterans benefits in administrative proceedings before the Department of Veterans Affairs (hereinafter, 

‘‘VA’’) and for other purposes. Committee Member Lindsey O. 

Graham is an original cosponsor of S. 2694. Committee Members 

Kay Bailey Hutchison and James M. Jeffords, and Senators Saxby 

Chambliss and Lisa Murkowski were later added as cosponsors. 

The bill was referred to the Committee. 

On April 26, 2005, Senator Christopher J. Dodd introduced S. 

909, a bill to expand eligibility for government markers for marked 

graves of veterans at private cemeteries. Senator Blanche L. Lincoln was later added as a cosponsor. 

On June 15, 2005, Committee Ranking Minority Member Daniel 

K. Akaka introduced S. 1252, a bill to increase the amount of supVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00001 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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plemental insurance available for totally disabled veterans. Committee Member Ken Salazar is an original cosponsor. 

On July 28, 2005, Committee Ranking Member Akaka introduced 

S. 1537, a bill to provide for the establishment of Parkinson’s Disease Research Education and Clinical Centers in the Veterans 

Health Administration of the Department of Veterans Affairs and 

Multiple Sclerosis Centers of Excellence. Committee Members 

Patty Murray and Barack Obama, and Senators Jeff Bingaman, 

Gordon H. Smith, Debbie Stabenow, Mark L. Pryor, and Tim Johnson were later added as cosponsors. 

On September 22, 2005, Chairman Craig introduced S. 1759, a 

bill to require the Secretary of the Army to remove the remains of 

Russell Wayne Wagner from Arlington National Cemetery. Senator 

Barbara A. Mikulski was later added as a cosponsor. 

On December 16, 2005, Senator Charles E. Schumer introduced 

S. 2121, a bill to provide housing loan benefits for the purchase of 

residential cooperative apartment units. Senators Mark Dayton 

and Paul S. Sarbanes are original cosponsors of S. 2121. Committee 

Member James M. Jeffords was later added as a cosponsor. 

On March 15, 2006, Senator Conrad R. Burns introduced S. 

2416, a bill to expand the scope of programs of education for which 

accelerated payments of educational assistance under the Montgomery GI Bill may be used, and for other purposes. Senator Mark 

L. Pryor is an original cosponsor. Committee Member Lindsey O. 

Graham and Senators Lisa Murkowski, Barbara A. Mikulski, Elizabeth Dole, Saxby Chambliss and E. Benjamin Nelson were later 

added as cosponsors. 

On March 16, 2006, Committee Member Ken Salazar introduced 

S. 2433, a bill to establish an Assistant Secretary for Rural Veterans within VA, to improve the care provided to veterans living 

in rural areas, and for other purposes. Committee Ranking Member 

Akaka, Committee Members Patty Murray, Richard Burr, and 

John Thune and Senators Conrad R. Burns, Kent Conrad, Blanche 

L. Lincoln, Craig Thomas, Max Baucus, Byron L. Dorgan, Tim 

Johnson, Lisa Murkowski, and Mark L. Pryor are original cosponsors. Senator Michael B. Enzi was later added as a cosponsor. 

On April 24, 2006, Chairman Craig introduced S. 2634, a bill to 

strike the term of the positions of Under Secretary for Health and 

Under Secretary for Benefits and simplify appointments to such positions. 

On April 26, 2006, Committee Ranking Member Akaka introduced S. 2659, a bill to provide for the eligibility of Indian tribal 

organizations for grants for the establishment of veterans’ cemeteries on trust lands. Senator Daniel K. Inouye is an original cosponsor of S. 2659. Committee Member Patty Murray was later 

added as a cosponsor. 

On May 8, 2006, Committee Ranking Member Akaka introduced 

S. 2762, a bill to ensure appropriate payment for the cost of longterm care provided to veterans in State homes, and for other purposes. Senators Olympia J. Snowe, Susan M. Collins, Charles E. 

Schumer, and Hillary Rodham Clinton were later added as cosponsors. 

On May 25, 2006, Senator Christopher J. Dodd introduced S. 

3069, a bill to modify the furnishing of government markers for 

graves of veterans at private cemeteries, and for other purposes. 


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Senators Robert C. Byrd, Mike DeWine, Tim Johnson, Patrick J. 

Leahy, Kent Conrad, Byron L. Dorgan, and Edward M. Kennedy 

are original cosponsors of S. 3069. Senators John F. Kerry, Blanche 

L. Lincoln, Jeff Sessions, Herb Kohl, Joseph I. Lieberman, Rick 

Santorum and George V. Voinovich were later added as cosponsors. 

On June 5, 2006, Senator Mike DeWine introduced S. 3363, a bill 

to provide for accelerated payment of survivors’ and dependents’

educational assistance for certain programs, and for other purposes. 

On June 20, 2006, Chairman Craig introduced S. 3545, a bill to 

improve services for homeless veterans, and for other purposes. 

Committee Ranking Member Akaka, and Committee Members 

Richard Burr and Barack Obama are original cosponsors of S. 

3545. Committee Member Johnny Isakson was later added as a cosponsor. 

COMMITTEE HEARINGS

On June 23, 2005, the Committee held a hearing on, among 

other bills, S. 1252 and S. 909. Testimony was heard from: Senators Wayne Allard and Mark L. Pryor; the Honorable Daniel L. 

Cooper, Under Secretary for Benefits, U.S. Department of Veterans 

Affairs; Mr. Steve Smithson, Assistant Director, Veterans Affairs 

and Rehabilitation, The American Legion; Mr. Quentin Kinderman, 

Deputy Director, National Legislative Service, Veterans of Foreign 

Wars of the United States; Mr. Rick Surratt, Deputy National Legislative Director, Disabled American Veterans; Mr. Carl Blake, Associate National Legislative Director, Paralyzed Veterans of America; and Mr. Richard Jones, National Legislative Director, 

AMVETS. 

On May 11, 2006, the Committee held a hearing on, among other 

bills, S. 1537, S. 2433, S. 2634, and S. 2762. Testimony was heard 

from: Dr. Michael Kussman, Deputy Under Secretary for Health, 

Veterans Health Administration, U.S. Department of Veterans Affairs; Mr. Robert Shaw, Legislative Chairman, National Association 

of State Veterans Homes; Mr. John Melia, Executive Director, 

Wounded Warrior Project; Mr. Carl Blake, Associate Legislative Director, Paralyzed Veterans of America; Mr. Juan Lara, Assistant 

Director, National Legislative Commission, The American Legion; 

and Mr. Adrian Atizado, Assistant Legislative Director, Disabled 

American Veterans. 

On June 8, 2006, the Committee held a hearing on, among other 

bills, S. 2121, S. 2416, S. 2659, S. 2694, and S. 3363. Testimony 

was heard from: Senators Conrad R. Burns and Mark L. Pryor; Mr. 

Ronald Aument, Deputy Under Secretary for Benefits, Veterans 

Benefits Administration, U.S. Department of Veterans Affairs; the 

Honorable Donald L. Ivers, former Chief Judge of the United 

States Court of Appeals for Veterans Claims; Mr. Quentin 

Kinderman, Deputy Director, National Legislative Service, Veterans of Foreign Wars of the United States; Mr. Richard F. 

Weidman, Director of Government Relations, Vietnam Veterans of 

America; and Mr. Barton F. Stichman, Co-Director, National Veterans Legal Services Program. 


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COMMITTEE MEETING

After carefully reviewing the testimony from the foregoing hearings, the Committee met in open session on June 22, 2006, and 

voted by unanimous voice vote to report favorably S. 2694, as 

amended, to include provisions derived from S. 909, S. 1252, S. 

1537, S. 1759, S. 2121, S. 2416, S. 2433, S. 2634, S. 2659, S. 2694, 

as introduced, S. 2753, S. 2762, S. 3069, S. 3363, S. 3545, and several original provisions. 

SUMMARY OF THE COMMITTEE BILL AS REPORTED

S. 2694, as reported (hereinafter, ‘‘the Committee bill’’), contains 

various amendments to title 38, United States Code, and freestanding provisions, that would: 

(a) Authorize claimants to have paid attorney representation 

in benefits cases before VA; 

(b) Establish the eligibility of Indian tribal organizations for 

grants for the establishment of veterans’ cemeteries on trust 

lands; 

(c) Require the Secretary of the Army to remove the remains 

of Russell Wayne Wagner from Arlington National Cemetery; 

(d) Extend the provision of government grave markers and 

headstones for the marked graves of veterans in private cemeteries; 

(e) Authorize accelerated payment of educational assistance 

under the Montgomery GI Bill for courses leading to employment in the transportation, construction, hospitality, or energy 

sectors of the economy; 

(f) Authorize accelerated payment of survivors’ and dependents’ educational assistance for courses leading to employment 

in the transportation, construction, hospitality, or energy sectors of the economy, or that lead to employment in a high technology occupation in a high technology industry; 

(g) Authorize funding for State Approving Agencies at $19 

million per year using funds paid from the readjustment benefit account and funds made available through discretionary 

appropriations; 

(h) Extend the biennial reporting requirement of VA and the 

Department of Defense on the operation of the Montgomery GI 

Bill program; 

(i) Mandate the establishment of at least six Parkinson’s disease, research, education, and clinical centers and at least two 

Multiple Sclerosis Centers of Excellence; 

(j) Eliminate the term limits for the positions of Under Secretary for Health and Under Secretary for Benefits; 

(k) Require VA to pay full costs for certain service-connected 

veterans residing in State homes, provide medications for certain service-connected conditions to veterans residing in State 

homes, and create a limited authority for the Secretary of Veterans Affairs (hereinafter, ‘‘the Secretary’’) to designate certain 

beds in non-State facilities as State homes for purposes of per 

diem payments; 

(l) Create an Office of Rural Health within the Office of the 

Under Secretary for Health at VA; 


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(m) Authorize a pilot program to provide caregiver assistance 

and non-institutional care services; 

(n) Reaffirm the national goal to end homelessness among 

veterans; 

(o) Express the Sense of the Congress on the appropriate response of the Federal Government to the needs of homeless 

veterans; 

(p) Extend the authority of VA to provide grant assistance 

for comprehensive service programs for homeless veterans; 

(q) Extend the authority of VA to provide treatment and rehabilitation services to seriously mentally ill and homeless veterans; 

(r) Extend the authority of VA to transfer properties it acquires through foreclosure proceedings on homes backed by 

VA-guaranteed loans for the purpose of housing homeless veterans; 

(s) Extend the authorization of, and increase the authorization amount for, grant funding for homeless veterans with special needs; 

(t) Extend the authorization of, and increase the authorization amount for, technical assistance programs provided to 

homeless veterans service providers; 

(u) Include additional required elements in an annual report 

on assistance provided to homeless veterans; 

(v) Add additional ex-officio members to the Advisory Committee on Homeless Veterans; 

(w) Provide additional rental assistance vouchers for VA-supported housing programs for homeless veterans; 

(x) Provide financial assistance for supportive services for 

low-income veteran families; 

(y) Authorize VA to guaranty loans for the purchase of stock 

in residential cooperative housing corporations; (z) Increase from $20,000 to $30,000 the amount of supplemental insurance coverage available to totally disabled veterans under the Service-Disabled Veterans’ Insurance program; 

(aa) Extend from September 30, 2008, to September 30, 

2011, the authorization for VA to match certain beneficiary income information with data from other agencies; 

(bb) Clarify the scope of covered correctional facilities for 

purposes of determining entitlement to certain benefits for 

those residing in correctional facilities. 

DISCUSSION

Section 101: Attorney representation in veterans’ benefits cases before the Department of Veterans Affairs 

Background: Veterans’ representation 

A. Introduction 

VA has a non-adversarial process for developing and adjudicating 

claims for veterans’ benefits. As part of that process, VA generally 

is obligated to notify a claimant of the evidence needed to substantiate a claim, to assist the claimant in obtaining that evidence, and 

to provide the claimant with the benefit-of-the-doubt in rendering 


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a decision. See 38 U.S.C. §§ 5103A, 5103(a), 5107(b). If a claimant 

disagrees with VA’s initial decision, the claimant may seek a more 

favorable outcome through the non-adversarial appeal process 

within VA, which may include multiple reviews of the claim by adjudicators at a VA regional office, and a review by the Board of 

Veterans’ Appeals (hereinafter, ‘‘BVA’’ or ‘‘Board’’). See 38 U.S.C. 

§§ 7105, 7107. 

During the VA administrative process, a claimant may seek assistance—without charge to the claimant—from a recognized representative of a veterans’ service organization (hereinafter, ‘‘VSO’’) 

or from other recognized individuals. See 38 U.S.C. § 5902, 5903. 

However, until that VA administrative process has been completed, 

a claimant is statutorily prohibited from paying an attorney or 

agent to provide services with regard to a claim for veterans’ benefits. See 38 U.S.C. § 5904(c). As explained below, that policy dates 

back to the Civil War and, today, is considered to be unfair and 

outdated by a broad spectrum of individuals and organizations, including judges, veterans’ organizations, veterans’ advocates, law 

professors, and bar associations. 

B. History of attorney fee limitation 

In 1862, in response to concerns that unscrupulous lawyers were 

bilking Civil War veterans out of their pensions, Congress imposed 

a $5 limit on the amount of fees that agents or lawyers could 

charge individuals seeking veterans’ benefits. 12 Stat. 566, 568 

(1862). Two years later, the $5 limit was raised to $10. 13 Stat. 

387, 389 (1864). When those limits were imposed, ‘‘there was no 

regulation of law practice by government or licensing of attorneys 

by bar associations’’ and, therefore, ‘‘[a]nyone could hold himself 

out as an attorney or claims agent and, for a fee, assist a veteran 

claim a pension.’’ Hearing on Benefits Legislative Initiatives, Senate Committee on Veterans’ Affairs, June 8, 2006, 109th Cong., 2d 

Sess. (hereinafter, ‘‘SVAC June 8, 2006, Hearing’’) (testimony of 

Mr. Richard Weidman). 

The Civil War era restriction on attorney fees remained in place 

for over 120 years, despite the subsequent development of ‘‘very 

powerful and active disciplinary entities’’ to police the legal profession. SVAC June 8, 2006, Hearing (testimony of the Honorable 

Frank Q. Nebeker). As a practical matter, the restriction on attorney fees resulted in very few veterans having attorney representation during administrative proceedings before VA. 

In 1988, Congress created the U.S. Court of Veterans Appeals to 

provide judicial review of decisions rendered by the BVA. See Veterans’ Judicial Review Act, Pub. L. 100–687, 102 Stat. 4105 (1988) 

(hereinafter, ‘‘VJRA’’); see also Pub. L. 105–368, 112 Stat. 3315 

(1998) (renaming the U.S. Court of Veterans Appeals as the U.S. 

Court of Appeals for Veterans Claims (hereinafter, ‘‘CAVC’’)). At 

that time, the Committee acknowledged that ‘‘the new right to judicial review * * * would be a hollow right indeed without some easing of the limitation on attorneys’ fees.’’ S. Rep. 100–418, at 63 

(1988). The Committee further stated: 

The basis for Congressional action, first after the Civil 

War * * *, limiting the amount an attorney could receive 

for representing a claimant before the VA was grounded in 

a belief that the lawyers of that day were unscrupulous 


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and were taking unfair advantage of veterans by retaining 

an unwarranted portion of the veterans’ statutory entitlement in return for very limited legal assistance. Whatever 

the merits of such a view at that time that the limitation 

was imposed * * * it is the Committee’s position that such 

a view of today’s organized bar, particularly in light of the 

widespread network of local bar associations that now generally police attorney behavior, is no longer tenable. 

The Committee is also of the view that the current statutory limitation is an undue hindrance on the rights of 

veterans and other claimants to select representatives of 

their own choosing to represent them in VA matters. 

S. Rep. 100–418, at 64. In discussing the reasons for not advancing 

legislation to allow attorney representation at the initial stages of 

the VA process, the Committee explained that ‘‘the existing limit 

on attorneys’ fees is generally appropriate with respect to the initial claims stage in the sense that applying for VA benefits is a relatively uncomplicated procedure.’’ S. Rep. 100–418, at 63. 

The Committee therefore advanced a bill (S. 11) that would have 

retained the $10 fee limit during the VA administrative process but 

would have lifted the fee limit after the BVA rendered an adverse 

decision. S. Rep. 100–418, at 65. Similarly, the House Committee 

on Veterans’ Affairs favorably reported a bill (H.R. 5288) that 

would have allowed paid attorney representation after VA had 

‘‘affirm[ed] its decision to deny a claim.’’ H. Rep. 100–963, at 28. 

As enacted, the VJRA removed the $10 fee limit and permitted 

claimants to hire attorneys only after ‘‘the date on which the [BVA] 

first makes a final decision in the case.’’ 38 U.S.C. § 5904(c). This 

allowed claimants to have the benefit of legal counsel when pursuing their cases before the CAVC, but did not permit claimants 

to hire attorneys until after VA had completed its administrative 

proceedings. 

C. Complexity of the VA system 

Since the enactment of the VJRA, there has been a growing recognition that the claims process is no longer a ‘‘relatively uncomplicated procedure’’ (S. Rep. 100–418, at 63). Among those recognizing 

this complexity have been the judges on the CAVC and those on 

the U.S. Court of Appeals for the Federal Circuit (hereinafter, 

‘‘Federal Circuit’’), which hears appeals from the CAVC. In fact, the 

CAVC has described the statutory and regulatory framework governing veterans’ benefits as a ‘‘confusing tapestry’’ (Hatlestad v. 

Derwinski, 1 Vet. App. 164, 167 (1991)) and the Federal Circuit has 

described the VA benefits system as involving ‘‘arcane intricacies 

* * * that require[ ] voluminous statutes, regulations, manuals, 

and circulars to administer’’ (Cook v. Principi, 318 F.3d 1334, 1357 

(Fed. Cir. 2002) (Gajarsa, J., dissenting)). 

The increasing complexity has been recognized by VA, as well. In 

fact, VA’s then-Under Secretary for Benefits testified in 2000 that 

‘‘[t]he Veterans Disability Compensation Program is the most complex disability claims system in the Federal government’’ and ‘‘[t]he 

process veterans must follow is complicated.’’ Hearing on the Department of Veterans Affairs Claims Adjudication and Pending 

Legislation Before the Committee, Senate Committee on Veterans’

Affairs, July 20, 2000, 106th Cong., 2d sess. (testimony of the HonVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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orable Joseph Thompson). Similarly, in 2005, VA’s current Under 

Secretary for Benefits, the Honorable Daniel Cooper, testified that 

the VA disability compensation system was becoming ‘‘increasingly 

complicated.’’ Hearing on Battling the Backlog: Challenges Facing 

the VA Claims Adjudication and Appeal Process, Senate Committee 

on Veterans’ Affairs, 109th Cong., 1st sess., May 26, 2005 (hereinafter, ‘‘SVAC May 26, 2005, Hearing’’). 

VSOs also have recognized the increasing complexity of the system. For instance, in 2005, the Veterans of Foreign Wars of the 

United States (hereinafter, ‘‘VFW’’) provided this description of the 

VA claims adjudication system: ‘‘Compared to the compensation 

program of a decade ago, the work is much more complicated. It 

is now a complex thicket of court decisions, and statutory requirements.’’ SVAC May 26, 2005, Hearing (testimony of Mr. Quentin 

Kinderman). Similarly, VFW testified in 2006 that, ‘‘[f]or a veteran 

without a service officer, navigating the highly complex bureaucracy that the VA claims process has become is a nightmare.’’ Hearing on the Legislative Presentation of the Veterans of Foreign Wars 

of the United States, Senate Committee on Veterans’ Affairs, 

March 7, 2006, 109th Cong., 2d sess. (testimony of Commander-inChief James Mueller). 

D. Support for repealing attorney fee limitation 

In view of that complexity, the growing recognition that section 

5904(c) of title 38 curtails veterans’ rights, and other important 

considerations, a wide array of individuals and organizations have 

expressed support for allowing veterans and other VA claimants to 

have the option of hiring lawyers at any time during the VA administrative process. See generally Matthew J. Dowd, Note, No 

Claim Adjudication Without Representation: A Criticism of 38 

U.S.C. § 5904(c), 16 Fed. Cir. B.J. (forthcoming Aug. 2006) (discussing increased public support for amending or revoking section 

5904(c) of title 38). 

Perhaps most significantly, ‘‘[t]he desirability of permitting veterans to employ lawyers during the early proceedings before the 

VA has been recognized by those in best position to perceive the 

prejudicial effect of the current system-the Judges presiding over 

the CAVC.’’ SVAC June 8, 2006, Hearing (statement for the record 

of Mr. James C. McKay). Indeed, after 10 years of experience as 

the first Chief Judge of the CAVC, the Honorable Frank Q. 

Nebeker criticized the prohibition on hiring attorneys in a 1999 

opinion: 

Another troubling aspect of representation has to do 

with the limited role lawyers are permitted (or may be 

paid) to play in the adjudication of claims for veterans benefits. When judicial review was established ten years ago, 

there was apparently concern on the part of Congress that 

opening the door to lawyer representation, even in a limited way, was so fraught with potential peril that at least 

some oversight of the attorney-client relationship was necessary. As a result, filing and review of fee agreements 

were, respectively, required and permitted. Arguably, 

there are two reasons why the law in the past ten years 

has reluctantly allowed fee-for-service legal representation. 

The creation of the [CAVC] and its review authority introVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00008 Fmt 6659 Sfmt 6969 E:\HR\OC\SR297.XXX SR297

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duced, for the first time, an adversarial process as an aspect of veterans claims adjudication. Secondly, the Congress might have anticipated that the pro bono services 

available at the regional office and [BVA] levels of [VA] 

would not usually be made available to disappointed claimants seeking to appeal to the [CAVC]. 

So the antiquated ten dollar limit on fees was scrapped 

for the no-fee-until-after-a-final-BVA-decision rule. 

Why the perceived need effectively to restrict lawyer representation by proscribing the charging of fees prior to a 

BVA decision and the oversight of fee agreements by the 

[CAVC]? In the absence of any empirical or statistical 

data, one can only wonder whether Congress presumed 

that the bar would act unprofessionally or would replace 

the services offered gratis by veterans service groups? If 

the former, it is an unfounded indictment based on mistrust. If the latter, it is evidence of a desire to prevent the 

bar from trespassing upon protected turf. In either case, 

now that we have had nearly ten years of experience, a 

questioning of the basic premises is in order. 

A third reason, and perhaps the most important one, 

may be gleaned from our over nine years of experience in 

reviewing BVA denials of benefits. The [CAVC] continues 

to see many appeals where, if counsel were realistically 

permitted to represent a claimant during the adjudication 

process before a final BVA decision, an appeal would be 

unnecessary or even seen as futile by the applicant. However, with the present restrictions on lawyer representation, an error at the VA level may not be discovered until 

years later, where with counsel it might well have been 

prevented at the outset. Thus, restricting realistic access 

to counsel until after a final BVA decision can cause years 

of delay both in adjudication before VA and in discovering 

the error through appellate litigation, only to have the 

matter returned to VA for readjudication. This happens in 

many appeals. 

Effectively limiting lawyer representation until after a 

BVA final decision and after oversight of fee agreements 

is, quite arguably, unnecessarily paternalistic. 

In the Matter of the Fee Agreement of Kenneth B. Mason Jr., 12 

Vet. App. 135, 137 (1999) (Nebeker, J., concurring). 

Subsequently, other CAVC judges spoke out against the restrictions on hiring lawyers. For instance, Judge Ronald Holdaway 

made the following statement in 2004: 

I think that there should be a right to counsel at the administrative level. * * * 

There’s a paternalism involved that seems to me to be 

excessive. * * * 

* * * If you get lawyers involved at the beginning, you 

can focus in on what is this case about. I think you would 

get better records, you would narrow the issue, there 

would be screening * * * but the fundamental reason, why 

should veterans be treated differently from anyone else? 


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* * * I think if we had lawyers involved at the beginning of these cases, it would be the single most fundamental change for the better that this system could have. 

Should 38 U.S.C. Section 5904 Be Amended?, Eighth Annual Judicial Conference, U.S. Court of Appeals for Veterans Claims, 19 Vet. 

App. 27 Advance Slip (April 22–23, 2004). Similarly, Judge Donald 

L. Ivers of the CAVC stated in 2004 that ‘‘[t]he Court has historically taken a position recognizing that involvement of lawyers before the VA could be very helpful, and I concur.’’ A Conversation 

with Chief Judge Donald L. Ivers, Tommy: A Lawyer’s Guide to 

Veterans Affairs, Fed. Bar Ass’n Veterans L. Sec., Washington, 

D.C. (Dec. 2004). 

Numerous professors of law also have reached the conclusion 

that the prohibition against hiring attorneys should be revisited. 

Principally among them, Professor William F. Fox, Jr., of Catholic 

University of America Columbus School of Law, offered the following opinion in his treatise on veterans’ law: 

Many of the problems at the Board that lead to defective 

Board decisions and that ultimately lead to the large numbers of remands for a proper statement of reasons or bases 

are attributable to the lack of a proper record-building 

process at the regional office level. 

Proper record building at the regional office level requires the participation of attorneys at the claims initiation stage of the process. The Social Security Administration, a benefits program in which attorneys are permitted 

to participate at the outset of the claims process, has very 

few of the record-building problems that continue to plague 

[VA]. Concededly, this requires legislation; but it is legislation of the highest import. 

William F. Fox, Jr., The Law of Veterans’ Benefits: Judicial Interpretation, at 254 (3d ed., Paralyzed Veterans of America, 2002). 

Professor Fox later opined that, if he were to design the ‘‘ideal 

process’’ for the veterans’’ benefits system, he would ‘‘[f]irst and 

foremost * * * eliminate the remaining and totally artificial restrictions on the use of attorneys in the system to permit attorneys 

to represent claimants at every stage of the proceeding, including 

the initial claims process.’’ William F. Fox, Jr., Deconstructing and 

Reconstructing the Veterans Benefits System, 13 Kan. J.L. & Pub. 

Pol’y 339, 344 (2004). 

Similarly, Professor Richard E. Levy, from the University of Kansas School of Law, offered this opinion in 2004: 

In light of the increasingly complex and legalistic character of the process, a critical question is whether non-attorney representation is sufficient. For example, the CAVC 

has adopted an exhaustion requirement under which it 

will not consider matters that were not raised before the 

BVA. Without representation by attorneys, claimants often 

may find that they have failed to properly raise critical 

matters before the agency and, as a result, their claims are 

foreclosed. 

* * * * * 


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* * * At the very least, veterans are left without an important source of protection considered essential in other 

legal contexts. 

* * * * * 

* * * [E]limination of limits on attorney compensation, 

perhaps the most entrenched feature of the [VA] system, 

warrants careful consideration. The administrative process 

is not always veteran friendly and may have become more 

adversarial as a result of judicial review. At any rate, the 

preservation of issues for review, which was not a factor 

before the VJRA, has become an important consideration 

and attorneys are likely to be especially helpful there. 

Moreover, while attorney representation is often seen as a 

negative from an agency perspective, attorney representation of veterans may well help the VA by reducing its burden of developing facts and compiling the record. 

Richard E. Levy, Of Two Minds: Charitable and Social Insurance 

Models in the Veterans Benefits System, 13–SPG Kan. J.L. & Pub. 

Pol’y 303, 318–24 (2004). 

Additionally, Professor Eugene R. Fidell, from American University Washington College of Law, recently stated that the prohibition against hiring attorneys ‘‘has been widely understood to be unfair for many, many years’’ and is ‘‘a museum piece that should 

have been gotten rid of a long time ago.’’ Jim Abrams, The Associated Press, Congress Seeks to Change Civil War Law (May 8, 

2006), found at http://www.wtopnews.com/?nid=116&sid=784420 

(last visited July 19, 2006). 

Numerous bar associations also have supported a repeal of section 5904(c) of title 38, including the American Bar Association, the 

Court of Appeals for Veterans Claims Bar Association, the Pennsylvania Bar Association, the Maryland State Bar Association, the 

Rhode Island Bar Association, the Oklahoma Bar Association, the 

West Virginia Bar Association, the Arizona Bar Association, the 

Bar Association of the District of Columbia, and the Washington 

Bar Association. See generally Matthew J. Dowd, Note, No Claim 

Adjudication Without Representation: A Criticism of 38 U.S.C. 

§5904(c), 16 Fed. Cir. B.J. (forthcoming Aug. 2006); Message from 

the President of the CAVC Bar Association, Jennifer A. Dowd, 

Esq., found at http://www.cavcbar.net (last visited July 14, 2006). 

In addition, lawyers and other advocates practicing veterans’ law 

before both VA and the CAVC have criticized the current restrictions against hiring attorneys. For instance, at the CAVC Judicial 

Conference in 2004, a long-time veterans’ law practitioner provided 

these observations regarding the current statutory prohibition: 

[T]his is an issue of choice. * * * That is certainly the 

way my clients have presented it to me when I tell them 

that I’m not able to represent them before there’s a final 

Board decision. And I note that [the materials distributed 

at the conference] talk at length about putting veterans in 

a special category. And I note that they are in a special 

category because they are one of only two groups in this 

country who are prohibited—legally prohibited from choosing to hire an attorney, and the other group is enemy combatants. 


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So I would like to understand * * * why it makes sense 

that veterans along with enemy combatants are prohibited 

from choosing. We are not talking about forcing them to 

hire an attorney, we’re not talking about what’s the best 

way to fix the system in terms of the VA system, we are 

talking about giving veterans and their families a choice 

about how they proceed on their own behalf. 

Should 38 U.S.C. Section 5904 Be Amended?, Statement of Ms. 

Barbara Cook, Eighth Annual Judicial Conference, U.S. Court of 

Appeals for Veterans Claims, 19 Vet. App. 40 Advance Slip (April 

22–23, 2004). (Since that time, the U.S. Supreme Court has loosened the restrictions against enemy combatants engaging attorneys. See Hamdi v. Rumsfeld, 542 U.S. 507 (2004).) 

At the same conference, the president of the National Organization of Veterans Advocates (hereinafter, ‘‘NOVA’’) opined that section 5904 ‘‘should be amended,’’ but cautioned that ‘‘any amendment to section 5904 should have a mandatory [continuing legal 

education] component to it’’ because ‘‘this is a complicated field of 

law.’’ Should 38 U.S.C. Section 5904 Be Amended?, Statement of 

Mr. Robert Chisholm, Eighth Annual Judicial Conference, U.S. 

Court of Appeals for Veterans Claims, 19 Vet. App. 26 Advance 

Slip (April 22–23, 2004). 

E. Committee hearings 

During the 109th Congress, the issue of attorney representation 

for veterans was discussed at several Committee hearings. Initially, in May 2005, NOVA testified before the Committee that allowing claimants to hire attorneys after the Board has issued a 

final decision ‘‘is too late in the process for counsel to be truly effective because by the time the Board makes a decision on the claim, 

the record is effectively closed.’’ SVAC May 26, 2005, Hearing (testimony of Mr. Robert Chisholm); see 38 U.S.C. §7252(b) (‘‘Review 

in the Court shall be on the record of proceedings before the Secretary and the Board.’’). In addition, NOVA testified at that hearing that, if retained at earlier stages of the proceedings, 

‘‘[a]ttorneys would be helpful in obtaining, organizing and presenting records on behalf of the veteran and making sure that the 

VA processes the claim in a timely and accurate manner.’’ In March 2006, The Retired Enlisted Association (hereinafter, ‘‘TREA’’) testified that there is no logic to the prohibition against 

hiring attorneys ‘‘except history.’’ Hearing on the Legislative Presentations of the Fleet Reserve Association, the Air Force Sergeant’s 

Association, the Retired Enlisted Association, the Gold Star Wives 

of America, and the Military Officers Association of America, Senate Committee on Veterans’ Affairs, March 2, 2006, 109th Cong., 

2d sess. (testimony of Ms. Deirdre Parke Holleman). In addition, 

TREA testified that allowing attorney representation during VA’s 

administrative proceedings ‘‘would help a great deal with the repetitive nature of the filings.’’

Then, at the Committee’s June 8, 2006, hearing, retired CAVC 

Judge Donald Ivers testified that ‘‘[f]reedom to seek counsel of one’s 

choice has long been a hallmark of this nation’s system of justice’’

and that it is ‘‘highly contradictory’’ that veterans ‘‘who have given 

much in defense of that system are denied that freedom in pursuing claims arising out of their service.’’ In addition, retired CAVC 


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Chief Judge Frank Q. Nebeker stated in written testimony for the 

record that ‘‘the paternal approach of effectively preventing lawyer 

representation in the benefits process [is] severely outmoded’’ and 

stressed that ‘‘veterans, like everyone else, should be at liberty to 

seek counsel in the free market.’’

Similar opinions were expressed in testimony provided at, or submitted for, the SVAC June 8, 2006, hearing by several organizations, including VVA, Paralyzed Veterans of America (hereinafter, 

‘‘PVA’’), NOVA, and the National Veterans Legal Services Program 

(hereinafter, ‘‘NVLSP’’). In part, Mr. Richard Weidman of VVA testified that ‘‘[l]egal counsel is the right of all Americans, except veterans’’ and that ‘‘[t]his is an injustice that must be redressed.’’ In 

addition, he stated: 

This limitation, and the patronizing reasoning behind it, 

sets veterans off from every other discrete group of the 

American population. No other group—including illegal 

aliens and felons in penal institutions—is barred from 

making a free choice about who will be their legal representative in matters personal to them that may be pending before the government. 

Along the same lines, NVLSP testified that ‘‘[i]t makes no rational sense to deny [veterans] this right when the right to choose to 

hire an attorney is enjoyed by criminal defendants, claimants for 

other federal government benefits including social security, and 

non-citizens opposing federal government efforts to deport them.’’

SVAC June 8, 2006, Hearing (statement of Mr. Barton Stichman). 

In addition, NVLSP testified that ‘‘the current network of veterans’

advocates available to our nation’s veterans is greatly overburdened’’ and that ‘‘[a]llowing disabled veterans to hire attorneys will 

help alleviate this burden and promote justice.’’ PVA submitted testimony for the June 8, 2006, hearing, noting 

that ‘‘[t]he reason for the statutory fee limitation, now a prohibition, does not exist currently and has not existed for a long time.’’

PVA recommended ‘‘that the Committee consider language similar 

to that contained in Title 42 that governs recognition of representatives before the Social Security Administration and the fees that 

those representatives may collect.’’ See 42 U.S.C. §406(a). 

On the other hand, VA, VFW, Disabled American Veterans (hereinafter, ‘‘DAV’’), and AMVETS provided testimony in June 2006 expressing their opposition to allowing veterans the option of hiring 

lawyers. Their principal bases for opposition included concerns that 

attorneys would charge veterans excessive fees, that attorneys 

would make the VA process more complicated or more adversarial, 

and that attorneys would not have sufficient training in this area 

of law to be effective. SVAC June 8, 2006, Hearing (testimony of 

Mr. Ronald Aument, VA Deputy Under Secretary for Benefits; Mr. 

Quentin Kinderman, VFW; Mr. Joseph Violante, DAV; and Mr. 

David G. Greineder, AMVETS). In addition, DAV stated that 

‘‘[v]eterans should be able to file claims for disability benefits and 

receive fair decisions from [VA] without the necessity to hire and 

pay a large portion of their benefits to lawyers’’ and that allowing 

veterans to hire attorneys ‘‘will have far reaching detrimental effects that will far outweigh the emotional gratification of having 

the right to choose representation by a lawyer.’’ SVAC June 8, 


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14 

2006, Hearing (testimony of DAV citing Walters v. National Ass’n 

of Radiation Survivors, 473 U.S. 305 (1985)). 

Those concerns were addressed by other witnesses at the June 

8, 2006, hearing, including Mr. Richard Weidman of VVA, who provided the following testimony: 

Primarily, the rationale articulated by the major VSOs 

and the VA for their vehement support for perpetuating 

the bar to veterans choosing attorney representation is paternalistic, i.e., they argue that the veterans benefits system is non-adversarial and pro-claimant, and as such veterans and their benefits must be ‘‘protected’’ from unscrupulous attorneys. Putting aside the merits of the argument 

that the VA benefits system is non-adversarial, the view 

that veterans need to be ‘‘protected’’ from attorneys simply 

has no basis in fact, and discriminates against veterans in 

comparison to the unfettered right of all other socioeconomic groups in our nation to hire an attorney. There 

is no evidence that veterans have been abused by their attorneys (by charging exorbitant fees, for example) upon 

their being provided representation services before the 

[CAVC] and then on remand from the [CAVC] to the BVA. 

Also cited by the VA and some others as to why attorney 

representation of veterans is harmful and should not be allowed is that, by introducing attorneys into the mix during 

the initial claims process, VA adjudicators will be forced to 

take a more adversarial position when adjudicating claims. 

However, many veterans’ advocates would argue that the 

VA adjudication process is already adversarial. Virtually 

any veteran who has been through this process will tell 

you that. 

* * * With the assistance of an attorney at the start of 

a claim, the adjudicator’s task can be streamlined to reviewing the evidence, developing the evidence as specified 

by the attorney, considering the attorney’s legal and factual arguments and analysis, and rendering a decision. If 

the attorney fully develops the evidence as much as possible and writes a coherent argument, a favorable claims 

decision is essentially written for the adjudicator. * * * 

Another discredited ‘‘doomsday’’ argument is that allowing attorneys to represent veterans at the [VA regional office] level will result in undue competition with service 

representatives, perhaps even causing smaller VSOs to be 

driven out of the business of representing veterans. Such 

an outcome is highly unlikely. Allowing veterans the right 

to choose attorney representation will not diminish the 

critically important role of VA accredited VSO service representatives. As demonstrated by VVA’s historical support 

for judicial review and the right to attorney representation, as well as its use of its own attorneys to represent 

veterans before the BVA and the [CAVC], VVA has always 

viewed the roles of accredited service representatives and 

attorneys as complementary. Both groups train and learn 

from each other, and cooperate in the representation of 

VVA’s veteran clients. The strength of accredited service 

representatives is in their front-line work in the field, deVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00014 Fmt 6659 Sfmt 6969 E:\HR\OC\SR297.XXX SR297

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veloping claims and succeeding at the regional office level 

in most routine cases. The further up the appeal process 

a case must go, the more likely it presents complicated 

legal or factual issues, and is not routine. In such cases, 

especially at the appellate levels, the role of attorneys can 

be critical to providing veterans with quality representation. 

Moreover, there will never be enough attorneys representing veterans to assist them all. Nor would attorneys 

have any incentive to take all veterans as clients. Because 

attorneys will be paid, economic considerations will determine the number of veterans who will choose legal representation. For the same reason, no small VSOs will be 

put out of the business of representing veterans because of 

attorneys. Only a small percentage of veterans’ benefits 

claims involve amounts of past-due compensation sufficient 

to create incentives for attorney representation. Because 

the vast majority of cases do not involve large awards of 

past-due benefits, the vast majority of veterans will continue to have their cases represented by accredited VSO 

service representatives. 

Yet another argument used in the past to resist attorney 

representation is that many attorneys have little or no 

training in VA laws, regulations and adjudication policies, 

which would result in inadequate representation or even 

legal malpractice. This is a ‘‘red herring’’ because, since 

the VJRA was enacted in 1988, there already have been a 

number of attorneys throughout the country practicing in 

this area of the law. It is true that more attorneys new to 

this practice will become involved if the current bar to attorney representation is repealed. However, ethical and 

other professional responsibility rules require attorneys to 

be competent to adequately represent their clients. Attorneys without direct experience with VA benefits laws and 

procedures should be at least familiar with how to obtain 

the information and learn what is necessary to provide 

adequate representation to veterans. This is not a new 

concept for attorneys. It is the method attorneys use with 

respect to every area of law in which they might practice. 

Lastly, opponents of allowing veterans’ freedom of choice 

also argue that only those veterans with financial means 

will be able to afford attorney representation. In other 

words, they argue that poorer veterans will be unable to 

afford attorneys and thus will be disadvantaged in terms 

of the quality of their representation, causing disparate 

classes of benefits claimants. It is highly unlikely, however, that some veterans will be denied the benefit of attorney representation based solely on their inability to pay 

the attorney’s fee. Virtually no veteran will be required to 

pay an attorney in advance for representation. The vast 

majority of veterans’ cases handled by attorneys will be 

done on a contingent basis (no fee unless an award of pastdue compensation is won), which is the case with the limited attorney represented cases that occur today. This 

means that the merits of the veteran’s case will most likely 


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determine his or her access to an attorney, not the veteran’s financial standing. 

The overriding concern for VVA, as well as any other individual or group that cares about the rights of veterans, 

is that veterans get the most effective representation possible. If a veteran wants to hire an attorney as his or her 

representative at the [VA regional office], is there a legitimate basis to deny them the right to do so? The position 

of VVA since its founding has been that no such basis exists. There should be no wavering from this same answer 

today. 

Additionally, in response to DAV’s testimony, Mr. James C. 

McKay provided this written statement: 

The DAV asserts in [its June 8, 2006, testimony] that 

‘‘veterans should be able to file claims for disability benefits and receive fair decisions from the [VA] without the 

necessity to hire and pay a large portion of their benefits 

to lawyers.’’ There is no foundation for the premise of that 

statement. Under the provisions of S. 2694, there would be 

no ‘‘necessity’’ that veterans hire lawyers. Rather, each 

veteran would have the choice of hiring a lawyer or not 

hiring a lawyer. Likewise, there is no basis for the demeaning conclusion that veterans would choose to hire a 

lawyer to satisfy an ‘‘emotional gratification of having the 

right to choose representation by a lawyers.’’

* * * * * 

The main thrust of the DAV’s argument relies completely on an outdated statement in S. Rep. No. 100–418, 

at 63–64 (1988), which, in turn, relied completely on the 

plurality opinion of four justices of the Supreme Court in 

Walters, issued twenty-one years ago. * * * 

The DAV statement does not mention that the plurality 

decision in Walters was based largely on the amazing conclusion that lawyers are not needed because service organizations representatives (who charge no fee) are fully capable of representing veterans for the reason that ‘‘complex’’ cases constituted a ‘‘tiny fraction’’ of the total cases 

pending before the VA. (473 U.S. at 329–330). The plurality of justices proclaimed that the medical questions relating to the degree of disabilities of veteran claimants 

were overwhelmingly simple, and that complex medical 

issues seldom arose in VA administrative proceedings. 

(Ibid.) 

The plurality justices’ view of the simplicity of veterans 

claims was at odds with the Supreme Court’s view stated 

eleven years earlier in Johnson v. Robinson, 415 U.S. 361, 

370 (1974), where the Court’s decision relied on a statement of the Administrator of the Veterans Administration 

in support of the 1979 amendment to 38 U.S.C. sec. 361 

(1974), that, ‘‘in the adjudication of compensation and pension claims, a wide variety of medical, legal, and other 

technical questions constantly arise which require expert 

examiners of considerable training and experience and 


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17 

which are not readily susceptible of judicial standardization.’’

SVAC June 8, 2006, Hearing (statement of Mr. James C. McKay). 

Although, The American Legion also expressed concerns about 

allowing veterans to hire attorneys, that veterans’ organization did 

not oppose the enactment of statutory provisions to address those 

concerns: 

The American Legion does not oppose the concept of attorney representation in the VA system or the lifting of 

current restrictions on attorney representation. We are 

concerned that such legislation should contain adequate 

safeguards to ensure each attorney’s competency, training 

and reasonable fee limits. We are pleased that this bill [S. 

2694] includes provisions addressing these areas of concern. We recommend a fee cap or reasonable hourly rate 

be included to help ensure a speedy resolution of the claim. 

As it currently stands with a 20 percent fee agreement, the 

longer it takes to satisfactorily resolve a claim, the larger 

an attorney’s fee. A fee cap or reasonable hourly rate 

would help to avoid this problem and create an incentive 

for a timely resolution of the claim. 

SVAC June 8, 2006, Hearing (testimony of Mr. Peter Gaytan). 

Background: Additional basis for suspension of claimant representatives 

For many years, the VA claims processing system has experienced ‘‘problems processing veterans’’ disability compensation and 

pension claims,’’ including ‘‘large numbers of pending claims and 

lengthy processing times.’’ SVAC May 26, 2005, Hearing (testimony 

of Ms. Cynthia Bascetta, U.S. Government Accountability Office). 

Some experts and stakeholders have suggested that ‘‘frivolous’’

claims contribute to those problems and that the system could be 

improved if those individuals representing claimants before VA 

help to deter the filing of frivolous claims. 

For example, the 1996 report of the Veterans’ Claims Adjudication Commission, found that some veterans’ representatives ‘‘encourage a veteran to file a claim that the agent knows will be denied, but prefer the VA to make the denial,’’ which ‘‘clogs the system with frivolous claims.’’ Veterans’ Claims Adjudication Commission, Report to Congress, at 137 (Dec. 1996); see Pub. L. 103–446 

(1994) (creating the Veterans’ Claims Adjudication Commission). 

Then, in a 2001 report to the Secretary of VA, the VA Claims 

Processing Task Force concluded that ‘‘service organizations can 

help improve service to beneficiaries and increase veteran satisfaction by * * * helping deter frivolous claims.’’ VA Claims Processing 

Task Force, Report to the Secretary of Veterans Affairs, at 59 (Oct. 

2001). In addition, that Task Force concluded that ‘‘[the Veterans 

Benefits Administration] and the service organizations must ensure 

that * * * frivolous claims are removed so that valid claims are 

not needlessly delayed.’’ Id. at 60. 

More recently, the National Association of State Directors of Veterans Affairs stressed that VSOs should have a ‘‘greater role * * * 

in the overall effort to manage and administer claims processing’’

and repeated the VA Claims Processing Task Force recommendaVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00017 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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tion that VSOs should ‘‘help [ ] deter frivolous claims.’’ Hearing on 

the Legislative Presentations of the National Association of State 

Directors of Veterans Affairs, AMVETS, the American Ex-Prisoners 

of War and the Vietnam Veterans of America, Senate Committee 

on Veterans’ Affairs, March 30, 2006, 109th Cong., 2d sess. (testimony of Mr. George Basher (quoting VA Claims Processing Task 

Force, Report to the Secretary of Veterans Affairs, at 59 (Oct. 

2001))). 

Despite those recommendations, there currently is no uniform 

policy applicable to all representatives regarding the filing of frivolous claims with VA. For instance, although attorneys have an ethical obligation ‘‘to examine a claim for its merit and to counsel the 

client against filing a claim if it is frivolous and without merit’’ (SVAC May 26, 2005, Hearing (testimony of Mr. Robert Chisholm, 

NOVA)), VA does not have explicit authority to suspend or exclude 

attorneys from practicing before VA if they violate that obligation 

(see 38 U.S.C. §5904(b)). In addition, although VSOs may decline 

to represent an individual if representation is ‘‘impracticable or inappropriate because under the circumstances the facts or law do 

not support the filing of a claim or appeal’’ (38 C.F.R. §14.628(d) 

Note (2006)), most VSOs ‘‘essentially represent any claimant.’’ SVAC May 26, 2005, Hearing (testimony of Mr. Rick Surratt, 

DAV). 

Committee bill 

Section 101 of the Committee bill would repeal the provisions of 

section 5904(c) of title 38, United States Code, that prevent claimants from hiring lawyers during the VA administrative process. In 

addition, it would provide the Secretary with authority (1) to require attorneys and agents practicing before VA to have minimum 

levels of experience and specialized training, (2) to set reasonable 

restrictions on the amount of fees that an attorney or agent may 

charge for services rendered before VA, (3) to collect from attorneys 

and agents a periodic registration fee to defray costs associated 

with attorneys or agents practicing before VA, and (4) to review fee 

agreements and reduce fees that are excessive or unreasonable. As 

a conforming change, the bill would modify the requirements for filing fee agreements with VA. The bill also would repeal the criminal 

penalties in section 5905 of title 38 applicable to representatives 

who impermissibly charge a fee for services provided in connection 

with a proceeding before VA. 

Section 101 would allow VA to suspend any representative—including agents, attorneys, representatives of VSOs, or individuals 

recognized for particular claims—from practicing before VA for any 

of the reasons specified in section 5904(b) of title 38, as modified 

by this bill. The modifications to section 5904(b) of title 38 would 

expand the basis for suspension to include presenting frivolous 

claims, issues, or arguments to VA or failing to comply with other 

conditions specified by the Secretary in regulations. 

In general, the provisions of section 101 would be effective 6 

months after the date of the enactment of the Committee bill. The 

provisions that would provide additional basis for suspension of individuals from practicing before VA (section (b)), that would repeal 

the limitation on hiring attorneys or agents (section (c)), that would 

modify the requirements for filing fee agreements (section (d)), and 


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that would modify the Secretary’s authority to review fee agreements and reduce fees (section (e)) would apply only to claims submitted to VA on or after that effective date. 

In deciding to favorably report this bill, the Committee recognizes that some organizations have concerns about allowing veterans the option of hiring attorneys. After carefully considering 

those views, the Committee has determined that continuing to 

abridge the personal rights of all veterans, and other VA claimants, 

is not an acceptable means of dealing with those concerns. Rather, 

the Committee has determined that Congress should take steps— as this bill would do—to minimize potential problems, while ensuring that our nation’s veterans, and other VA claimants, will have 

the right to decide for themselves whether to hire attorneys. 

Above all, the Committee expects that, after the enactment of 

this bill, VA will continue to serve all claimants in a non-adversarial, claimant-friendly manner, regardless of the presence of an 

attorney or any other representative in any case before VA. In addition, this Committee, VA, veterans’ advocates, veterans’ organizations, and other stakeholders should continue to seek ways to reduce the complexities of the VA adjudication system. 

Regarding the implementation of this bill, the Committee notes 

that VA currently has in place extensive regulations and procedures governing agents and attorneys who represent veterans and 

other claimants before VA. See, e.g., 38 C.F.R. §§ 14.626–14.635 

(2006). Although amendments to existing regulations and procedures may be necessary and appropriate to reflect the new and expanded flexibility for veterans to retain counsel, the Committee 

does not anticipate a major regulatory burden on VA. 

The Committee acknowledges that individuals and organizations 

have recommended that the prohibition on hiring attorneys be lifted on the bill’s day of enactment for all pending and future claims. 

However, the Committee has adopted a delayed and staggered effective date, which will allow a deliberate and gradual implementation of these policies in order to minimize any disruption to the VA 

system. 

Regarding the addition of ‘‘frivolous’’ filings as a basis for suspension from practice before VA, the Committee notes that, in recent 

years, the number of claims filed with VA has increased dramatically and the number of disabilities per claim also has increased 

significantly. See Department of Veterans Affairs FY 2007 Budget 

Submission, Volume 2, 5A–2 (noting that ‘‘annual claims receipts 

grew 36 percent from 2000 to 2005’’ and that ‘‘the number of cases 

with eight or more disabilities claimed doubled from 21,814 in 2000 

to 43,655 in 2005’’). In light of this workload, the Committee believes that requiring all veterans’ representatives to advocate responsibly, by avoiding frivolous claims, arguments, or issues, could 

be of significant help in ensuring that ‘‘valid claims are not needlessly delayed.’’ VA Claims Processing Task Force, Report to the 

Secretary of Veterans Affairs, at 60 (Oct. 2001). 

The Committee expects that this authority with respect to frivolous filings will be utilized by VA but that it will be used cautiously, so as not to have an undue chilling effect on the filing of 

claims that may ultimately succeed. See Abbs v. Principi, 237 F.3d 

1342, 1351 (Fed. Cir. 2001) (defining frivolous arguments or issues 

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minded people’’ (quoting State Indus., Inc. v. Mor-Flo Indus., Inc., 948 F.2d 1573, 1578 (Fed. Cir. 1991))); Int’l Union of Bricklayers 

v. Martin Jaska, Inc., 752 F.2d 1401, 1406 (9th Cir. 1985) (defining 

a frivolous appeal ‘‘as one in which the result is obvious, or where 

the appellants’’ claims are utterly meritless’’). In that regard, the 

Committee intends that attorneys not be sanctioned for pursuing 

claims in a manner consistent with the ethical standards of jurisdiction(s) where they are licensed to practice law, but that VA will 

proceed with suspension in cases of egregious or bad faith behavior 

exceeding those standards of conduct. In no case should an attorney be suspended for pursuing all benefits potentially available to 

a client or for good faith challenges to existing regulations, statutes, or case law necessary to that pursuit. 

Section 201: Eligibility of Indian tribal organizations for grants for 

the establishment of veterans’ cemeteries on trust lands 

Background 

Section 202 of Public Law 95–476 established the State Cemetery 

Grants Program within VA and is codified in section 2408 of title 

38, United States Code. Through the State Cemetery Grants Program, VA may provide up to 100 percent of the cost to establish, 

expand, or improve a veterans’ cemetery owned by a State. In turn, 

the State must provide suitable cemetery land and agree to operate 

and maintain the cemetery in accordance with VA standards. 

The State Cemetery Grants Program serves as a complement to 

VA’s nationwide system of national cemeteries in meeting the overarching goal of ensuring that those who have served honorably in 

the military have a dignified, final resting place. The establishment 

or expansion of State veterans’ cemeteries is particularly valuable 

in areas of the country where the veterans’ population is insufficient to justify construction of a VA national cemetery. 

Under current law, the State Cemetery Grants Program is limited to veterans’ cemeteries that are owned and operated by a State 

or U.S. territory. At present, 63 State-operated cemeteries have received grants under the program. Because tribal organizations are 

not considered States under existing law, they do not qualify for 

grant assistance. 

Committee bill 

Section 201 of the Committee bill would authorize VA to make 

grants under the State Cemetery Grants Program to any tribal organization for the purpose of establishing, expanding, or improving 

veterans’ cemeteries on trust lands owned by, or held in trust for, 

the tribal organization. Tribal organizations would be defined in 

the same manner as in section 3765(4) of title 38, United States 

Code. Under section 201 of the Committee bill, ‘‘trust lands’’ would 

have the same meaning as in section 3765(1) of title 38. 

Section 202: Removal of remains of Russell Wayne Wagner from Arlington National Cemetery 

Background 

The commission of certain crimes after separation from military 

service has long been a basis for denial of veterans’ benefits. 

Crimes against the Nation (e.g., mutiny, treason, sabotage, or renVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00020 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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dering assistance to the enemy) disqualify a veteran from all veterans’ benefits, to include cemetery burial rights. See 38 U.S.C. 

§§ 6103, 6104, 6105. The law also provides for the reduction of VA 

disability compensation for convicted felons serving a sentence of 

60 days or more in a Federal, State, or local penal institution. See 

38 U.S.C. § 5313. In 1997, Public Law 105–116 was enacted to prohibit individuals from being interred or inurned at VA national 

cemeteries, Arlington National Cemetery (hereinafter, ‘‘Arlington’’), 

or VA-funded State cemeteries, if the individual 1) was convicted 

of a Federal capital crime for which the person was sentenced to 

death or life imprisonment; 2) was convicted of a State capital 

crime (defined as the willful, deliberate, or premeditated unlawful 

killing of another human being) for which the person was sentenced to death or life imprisonment without parole; or 3) was 

found (through an administrative process) to have committed a 

Federal or State capital crime but was not convicted of that crime 

by reason of death or flight from prosecution. Also in 1997, section 

1077 of Public Law 105–85 was enacted to prohibit individuals 

from being interred or inurned in Arlington who are convicted of 

a capital offense under Federal law for which the death penalty 

may be imposed. 

According to testimony received at the Committee’s September 

22, 2005, hearing, Russell Wayne Wagner, a veteran who served on 

active duty for 3 years during the Vietnam era, was convicted in 

2002 of the 1994 murders of Daniel and Wilda Davis. For his 

crime, Wagner was given two consecutive life sentences with the 

opportunity for parole. Wagner died in prison in February 2005 

while carrying out his sentence. His cremated remains were 

inurned in Arlington in July 2005. Because Wagner’s sentence for 

his State capital crime carried with it the possibility of parole, none 

of the laws enacted in 1997 provided a legal impediment to the 

inurnment of his remains. 

The 1997 laws first expressed the Congress’s desire to preserve 

the unique status of our nation’s military cemeteries as national 

shrines by proscribing burial eligibility to individuals convicted of 

capital murder. Moved by the Wagner case, which demonstrated 

that the effect of the 1997 laws was diluted by myriad State sentencing guidelines for murder, section 662 of Public Law 109–163 

was enacted in January 2006 to, among other things, remove parole eligibility as a loophole through which State capital offenders 

could retain their eligibility for burial in a national cemetery. Wagner’s remains, however, remain inurned in Arlington. According to 

cemetery officials, Wagner’s is the sole case of a convicted murderer’s remains being interred or inurned in Arlington since 1997. 

Committee bill 

Section 202 of the Committee bill would direct the Secretary of 

the Army to remove the remains of Russell Wayne Wagner from 

Arlington. The Secretary of the Army would first be required to notify the next-of-kin of record for Russell Wayne Wagner of the impending removal of his remains so that the next-of-kin has time to 

make other burial arrangements. The Secretary of the Army would 

then be required to relinquish Wagner’s remains. In the event that 

no next-of-kin is available, section 202 would direct the Secretary 


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of the Army to arrange for an appropriate disposition of the remains. 

Section 202 would also make five Congressional findings that are 

relevant to understanding why Wagner’s remains would be ordered 

removed from Arlington. The first finding is that Arlington is a national shrine that memorializes the service of men and women who 

have defended the freedoms that the people of the United States 

enjoy. The second is that including remains of persons who have 

committed particularly notorious, heinous acts among those interred in Arlington would bring dishonor to the deceased and disrespect to their loved ones. The third finding is that the removal 

of remains of persons who have committed heinous acts is not an 

act of punishment against those persons, but rather is an act that 

would preserve the sacredness of cemetery grounds. The fourth 

finding is that Congress first enacted laws barring capital offenders 

from interment or inurnment in Arlington in 1997, and then in 

2006 passed a law to remove parole eligibility as a loophole 

through which capital offenders could retain interment or 

inurnment eligibility. And finally, the fifth finding is that Russell 

Wayne Wagner is the only individual convicted of a capital offense 

who has been interred or inurned in Arlington since 1997, the year 

Congress first expressed its intent to keep such offenders out of the 

Nation’s national cemeteries. 

The Committee recognizes that removing entitlement to gratuitous veterans’ benefits based on actions that did not constitute a 

bar to entitlement at the time the benefits were conferred raises 

questions of constitutionality under ex post facto and bill of attainder considerations. In Calder v. Bull, 3 U.S. (3 Dall.) 386, 390–392 

(1798), the United States Supreme Court established a long-standing principle that an act violates the ex post facto clause of the 

U.S. Constitution when it is punitive, or criminal, in nature rather 

than civil. Whether a law is civil or punitive can, in part, be determined through an examination of legislative intent. According to 

the Supreme Court’s decision in Seling v. Young, 531 U.S. 250, 261 

(2001), a statute will be struck down only when a court determines 

that ‘‘the statutory scheme is so punitive in either purpose or effect 

as to negate the State’s intention.’’ Seling v. Young also established 

that a statute that has been classified as civil cannot be ‘‘deemed 

punitive ‘as applied’ to a single individual,’’ id. at 263. Leaving 

aside the question of whether any law respecting the disposition of 

a deceased person’s remains could ever be considered punitive, it 

is clear from the Congressional findings portion of section 202 of 

the Committee bill that the intent behind ordering Wagner’s remains removed is to uphold the unique status of Arlington National Cemetery as a national shrine, as established by existing 

law. It is a place for our military dead to be forever memorialized 

and honored. Keeping the remains of a convicted double murderer 

in Arlington is incompatible with that expressed intent. 

Bills of attainder are prohibited by the U.S. Constitution and 

have been interpreted to include legislative acts which apply to certain named individuals or ‘‘easily ascertainable’’ members of a 

group in which the individuals are punished without a judicial trial 

(United States v. Lovitt, 328 U.S. 303, 315 (1946)). A controlling 

case for purposes of section 202 of the Committee bill is Nixon v. 

Administrator of General Services, 433 U.S. 425, 468–484 (1977). In 


bajohnson on PROD1PC77 with REPORTS
23 

that decision, the Supreme Court established a three-prong test in 

determining whether an act was a prohibited bill of attainder. An 

act was not a bill of attainder if 1) it imposed no punishment traditionally judged to be prohibited by the clause; 2) viewed functionally in terms of the type and severity of burdens imposed, it could 

rationally be said to further nonpunitive legislative purposes; and 

3) it had no legislative record evincing a Congressional intent to 

punish. Again, leaving aside the question of whether it is possible 

to further ‘‘punish’’ a deceased individual, this three-prong test applied to the removal of Russell Wayne Wagner’s remains demonstrates no violation of Constitutional principles relating to bills 

of attainder. Furthermore, the Supreme Court in the Nixon case 

concluded that even though the law in question specifically named 

the subject of the law, the act would not be struck down because 

the individual ‘‘constituted a legitimate class of one, on whom Congress could fairly and rationally focus.’’ Thus, while section 202 of 

the Committee bill specifically names Russell Wayne Wagner, it 

does so for a fair and rational reason, i.e., his are the only known 

remains of a capital offender interred in Arlington National Cemetery since 1997, the year Congress first expressed its desire to prohibit such offenders from burial privileges. 

Section 203: Provision of government markers for marked graves of 

veterans at private cemeteries 

Background 

The organizational entity within VA responsible for the administration of VA’s memorial programs is the National Cemetery Administration (hereinafter, ‘‘NCA’’). One of NCA’s strategic goals is 

to provide veterans and their families with symbolic expressions of 

remembrance of the veteran’s military service. These symbolic expressions include NCA’s burial flag benefit, Presidential Memorial 

Certificate benefit, and the headstone and marker benefit. 

Under current law, VA will furnish upon request, at no charge 

to the veteran or the veteran’s family, a headstone or marker to 

mark the grave of an eligible veteran in any cemetery around the 

world. Until recently, VA only had the authority to furnish a headstone or marker for unmarked graves, i.e., no double marking with 

a privately-purchased marker and then a government marker was 

permitted. As will be detailed below, the program has been expanded to allow VA to furnish a headstone or marker for a grave 

that is already privately marked. 

To meet family needs and private cemetery requirements, VA 

makes its full product line of headstones and markers available. 

While the style of the headstone or marker chosen must be consistent with existing monuments at the place of burial, families 

may choose from among flat bronze, granite, or marble markers 

and upright granite and marble headstones. 

Since the end of the Civil War, Congress gradually has expanded 

the provision of government headstones and markers to mark the 

graves of deceased veterans. There is a two-fold purpose behind 

this expansion: First, no person who served honorably in the military should, for lack of means, be buried in an unmarked grave. 

Second, irrespective of means, those who have served deserve a 

permanent memorialization of their military service. 


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Originally, government headstones were provided only to mark 

the unmarked graves of veterans interred in military cemeteries. 

On February 3, 1879, Congress authorized the furnishing of 

headstones for the unmarked graves of veterans in private cemeteries. On October 18, 1978, Congress authorized VA to provide 

families of deceased veterans with a choice between being provided 

a government headstone or marker, or an allowance in lieu of a 

government-provided headstone or marker. With the enactment of 

the Omnibus Budget and Reconciliation Act, and effective November 1, 1990, the option of providing an allowance was eliminated. 

In its Fiscal Year 1999–2000 Report, the Advisory Committee on 

Cemeteries and Memorials recommended legislation to provide 

families with a VA headstone or marker for the privately-marked 

graves of eligible veterans, retroactive to November 1, 1990. In 

comments made within the Report, NCA noted that many families 

who chose private memorialization felt that they had lost out on a 

government benefit. The NCA reported that families were upset 

that they could not receive government headstones or markers to 

place along, or affix to, existing headstones or markers at private 

cemeteries. 

Section 502 of the Veterans Education and Benefits Expansion 

Act of 2001 (hereinafter, ‘‘the VEBE Act’’), Public Law 107–103, 

created a 5-year program during which time VA is required, upon 

request, to provide a government marker for veterans’ graves in 

private cemeteries which are already privately marked. The new 

program applies to veterans who die on or after December 27, 

2001, the date of enactment of the VEBE Act, and expires on December 31, 2006. Section 203 of the Veterans Benefits Act of 2002, 

Public Law 107–330, amended the effective date of eligibility to 

apply to deaths occurring on or after September 11, 2001. Thus, 

since 1978, only the families of veterans who died between November 1, 1990, and September 11, 2001, have not been able to avail 

themselves to a government-provided benefit, i.e., either a government-provided headstone or marker or an allowance in lieu thereof, 

if the grave of a veteran was already privately marked. 

In a February 2006 report required by the VEBE Act titled Report to Congress on the Provision of Government-Furnished Markers 

for Privately-Marked Graves, the Secretary recommended, in addition to making permanent the authority to provide a government 

headstone or marker for privately-marked graves, that Congress 

also consider clarifying how VA will accommodate the various 

needs of veterans’ families when selecting and placing a Government-furnished headstone or marker. Furthermore, the Secretary 

recommended incorporating into statute VA’s existing regulatory 

language that describes the delivery, placement, and availability of 

government headstones and markers. Additionally, the Secretary 

recommended revising existing language to support VA’s furnishing 

a ‘‘headstone or marker,’’ as opposed to only a government ‘‘marker,’’ for privately-marked graves in private cemeteries. 

Committee bill 

Section 203 of the Committee bill would permanently authorize 

VA to provide government headstones or markers for the privatelymarked graves of veterans in private cemeteries. In addition, it 

would authorize VA to provide headstones and markers for the priVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00024 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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vately-marked graves of veterans who died on or after November 

1, 1990. Section 203 would also effect the Secretary’s recommendations to put into statute language that regulates delivery, placement, and availability of government-furnished headstones or 

markers. 

Section 301: Expansion of education programs eligible for accelerated payment of educational assistance under the Montgomery 

GI bill 

Background 

Under the Montgomery GI Bill—Active Duty (hereinafter, 

‘‘MGIB–AD’’) program, a veteran with at least 3 years of active 

duty service generally may receive educational assistance benefits 

in the maximum amount of $1034 per month for 36 months. In 

2001, Congress added a new provision to the MGIB–AD program 

to allow a veteran to receive ‘‘accelerated payment’’ of educational 

assistance benefits if the veteran is enrolled in a program leading 

to employment in a high technology industry. Programs that qualify for accelerated payments include engineering, mathematics, 

computer specialities, life science, and physical science, as long as 

the veteran will be seeking employment in a high technology industry, e.g., the aerospace industry. Generally, to qualify for accelerated payments, the tuition and fees for a program, when divided 

by the number of months in the program enrollment period, must 

be more than double the amount of monthly MGIB–AD benefits. 

Sixty percent of tuition and fees for the program term may be covered through a lump sum, accelerated payment. 

In 2003, President George W. Bush announced his ‘‘High Growth 

Job Training Initiative,’’ an effort to prepare workers to take advantage of new and increasing job opportunities in high growth, 

high demand, and economically vital sectors of the economy. Currently, 14 sectors have been identified as high growth: Advanced 

manufacturing, aerospace, automotive, biotechnology, construction, 

energy, financial services, geospatial technology, health care, homeland security, hospitality, information technology, retail, and transportation. 

Committee bill 

Section 301 of the Committee bill would allow accelerated payments of MGIB–AD benefits for veterans enrolled in educational 

assistance programs that last fewer than 2 years and which lead 

to employment in the transportation sector, the energy sector, the 

construction sector, or the hospitality sector of the economy. In addition, the Committee bill would authorize accelerated benefits for 

such educational assistance programs offered by tribally-controlled 

colleges or universities. 

The provisions of section 301 would take effect on October 1, 

2007, and would apply only to enrollments that begin on or after 

that date. The provisions would expire on September 30, 2011. 


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Section 302: Accelerated payment of survivors’ and dependents’ educational assistance for certain programs of education 

Background 

In general, a spouse or child of a veteran who dies or is totally 

disabled from a service-connected condition may receive up to 45 

months of educational assistance benefits under the Survivors’ and 

Dependents’ Educational Assistance program (hereinafter, ‘‘DEA’’). 

As of October 1, 2005, the maximum monthly DEA payment is 

$827 per month. 

DEA recipients are not currently eligible to receive ‘‘accelerated 

payment’’ of their educational assistance benefits, an option which 

is available only to eligible veterans under the MGIB–AD program 

who enroll in certain programs leading to employment in a high 

technology industry. 

Committee bill 

Section 302 of the Committee bill would allow accelerated payments for survivors and dependents enrolled in educational assistance programs that last fewer than 2 years and lead to employment in a high technology industry, or which lead to employment 

in the transportation sector, the energy sector, the construction sector, or the hospitality sector of the economy. 

The provisions of section 302 would take effect on October 1, 

2007, and would apply only to enrollments that begin on or after 

that date. The provisions would expire on September 30, 2011. 

Section 303: Reimbursement of expenses for State approving agencies in the administration of educational benefits 

Background 

Under provisions of chapter 36 of title 38, United States Code, 

VA contracts for the services of State Approving Agencies (hereinafter, ‘‘SAAs’’) for the purpose of approving programs of education 

at institutions of higher learning, apprenticeship programs, on-job 

training programs, and other programs that are located within 

each SAAs’ State of jurisdiction. Generally, SAA approval of these 

programs is required before beneficiaries may use their educational 

assistance benefits to pay for them. SAAs are also tasked with assisting VA with various outreach activities to inform eligible VA 

program participants of the educational assistance benefits to 

which they are entitled. 

Since 1988, VA payment for the services of SAAs has been made 

only out of funds available for readjustment benefits and is subject 

to annual funding caps. Section 3674(a)(4) of title 38, United States 

Code, states as follows: ‘‘The total amount made available under 

this section for any fiscal year may not exceed $13,000,000 or, 

* * * for fiscal year 2006, $19,000,000, and for fiscal year 2007, 

$19,000,000.’’ Thus, existing law anticipates a reduction in authorized SAA funding of $6 million beginning in fiscal year 2008. Employees of SAAs are acutely aware of this potential problem. As is 

stated in the 2006 Report of State Approving Agencies: ‘‘If no action 

is taken, in 2008 the cap will revert back to 13 million dollars—

a 32 percent cut!’’


bajohnson on PROD1PC77 with REPORTS
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Payments made from the readjustment benefit account are considered mandatory, or direct, spending. Section 505 of the fiscal 

year 2004 budget resolution (H. Con. Res. 95, 108th Congress) stipulates that a point of order may be raised in the Senate (through 

fiscal year 2008) against any mandatory spending legislation not 

assumed in the most recently-adopted budget resolution that would 

increase, or cause, an on-budget deficit for the first fiscal year, the 

period of the first 5 fiscal years, or the period of the following 5 

fiscal years. Thus, legislation that would continue SAA funding at, 

or near, the current $19 million level using funds available for readjustment benefits would run afoul of Senate budget rules if no 

offset is identified. Because the Committee’s priority is to use identified offsets to enhance benefit programs for veterans and their 

survivors, as is evident in sections 301, 302, and 602 of the Committee bill, and given current budget constraints, it is unlikely that 

SAA funding can be sustained from mandatory accounts alone. 

Committee bill 

Section 303 of the Committee bill establishes an authorized funding level for SAAs of $19 million. Furthermore, the Committee bill 

establishes a hybrid funding mechanism for SAAs, with some funding to remain available from amounts paid for readjustment benefits, and other funding that is subject to the availability of discretionary appropriation. Funding from amounts available for readjustment benefits would be capped at $19 million in fiscal years 

2006 and 2007, $13 million for each of fiscal years 2008 and 2009, 

$8 million in each of fiscal years 2010 through 2013, and $13 million for fiscal year 2014 and each subsequent fiscal year. 

Section 304: Modification of requirement for reporting on educational assistance program 

Background 

Section 3036 of title 38, United States Code, requires both VA 

and the Department of Defense (hereinafter, ‘‘DoD’’) to submit to 

the Congress separate, biennial reports on the operation of the 

Montgomery GI Bill educational assistance program. DoD’s report 

is directed to include information on whether educational assistance benefits are adequate to meet its recruiting and retention 

needs. VA’s report is directed to include information on program 

utilization and expenditure levels. Both agencies’ reports are directed to include legislative recommendations for improvements, if 

there are any. No report has been required under this section since 

January 1, 2005. 

Committee bill 

Section 304 of the Committee bill would reinstate the biennial reporting requirement and extend it until January 1, 2011. The first 

report from each agency would be due no later than 6 months after 

the date of the Committee bill’s enactment. Each subsequent biennial report would be due on January 1. 


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Section 401: Parkinson’s Disease Research, Education, Clinical Centers, and Multiple Sclerosis Centers of Excellence 

Background 

VA has a long and storied history as a leader in the advancement 

of medicine, and the Committee commends the department for its 

progressive and innovative research endeavors. Among the approaches that VA uses to advance its research efforts is the establishment of centers of excellence, and other centers, which combine 

basic biomedicine, rehabilitation, health services delivery, and clinical trials in their focus on a specific subject matter. This combined 

model was pioneered in the mid-1970s with the establishment of 

Geriatric Research, Education, and Clinical Centers (hereinafter, 

‘‘GRECCs’’) which focus special attention on conditions of the aging 

veteran population. There currently are twenty-one GRECCs. 

In 2003, the Veterans Health Administration established two 

Multiple Sclerosis Centers of Excellence (hereinafter, ‘‘MSCoEs’’) to 

serve the health care needs of approximately 28,000 veterans with 

Multiple Sclerosis (hereinafter, ‘‘MS’’). These centers are located in 

Seattle and Portland, collectively known as ‘‘MSCoE, West’’ and 

Baltimore, known as ‘‘MSCoE, East.’’ Through these centers, scientists are able to carry out focused research on the causes, symptoms, and treatment of MS, including on symptoms such as fatigue 

and spasticity associated with MS, so as to give veterans afflicted 

with this disease a better quality of life. 

In 2001, VA established six Parkinson’s Disease Research, Education and Clinical Centers (hereinafter, ‘‘PADRECCs’’). Operating 

as a national consortium, each PADRECC is participating in a 

landmark clinical trial to assess the effectiveness of surgical implantation of deep brain stimulators in reducing the symptoms of 

Parkinson’s disease, while also studying other innovative clinical 

treatments. The six PADRECCs are located in the following cities: 

Houston, TX; Philadelphia, PA; Portland, OR; Seattle, WA; San 

Francisco, CA; Los Angeles, CA; and Richmond, VA. Through the 

PADRECCs, clinicians and educators can, among other things, determine better ways to manage symptoms associated with Parkinson’s disease. 

Committee bill 

Section 401 of the Committee bill would add a new section to 

title 38, United States Code, which would authorize VA to designate at least six PADRECCs and at least two MSCoEs. Additional centers could be established under this authority. Proposals 

for any future MSCoEs or PADRECCs would have to be vetted 

through a panel made up of experts in neurodegenerative diseases. 

The existing six PADRECCs and two MSCoEs serve veterans 

across the entire Veterans Health Administration via a nationally 

coordinated system. These centers are the model of innovation in 

the delivery of highly specialized healthcare and research for 

chronic disease in the veteran population. In providing a statutory 

basis for these centers, the Committee intends to ensure their continued existence. 


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Section 402: Repeal of term of office for the Under Secretary for 

Health and the Under Secretary for Benefits 

Background 

Chapter 3 of title 38, United States Code, contains a description 

of the fourteen VA positions for which Presidential nomination and 

Senate confirmation are required. There are seven Assistant Secretaries, one General Counsel, one Inspector General, three Under 

Secretaries, a Deputy Secretary, and a Secretary. Under Chapter 

71 of title 38, United States Code, Presidential nomination and 

Senate confirmation are required for the position of BVA Chairman, whose term is for 6 years. 

With the exception of BVA Chairman, only the Under Secretary 

for Health and the Under Secretary for Benefits have statutory 

limits to their terms of office. All other positions serve at the pleasure of the President without a statutory term of office. 

Committee bill 

Section 402 of the Committee bill would repeal the 4-year terms 

of office for the Under Secretary for Health and Under Secretary 

for Benefits positions. In taking this action, the Committee recognizes that the 4-year terms of office were originally intended to 

shield the office-holders from any political influence. The hope was 

that statutory term limits would allow the two officials to serve 4 

consecutive years without any political considerations regardless of 

whether the service was in different administrations or under different VA leadership. History, however, has shown that new administrations or even new VA leadership within the same administration often bring new people at all levels of government, including the two Under Secretary positions. In fact, the last three Under 

Secretaries for Health and the previous Under Secretary for Benefits did not complete a full 4–year term. 

The Committee also recognizes that passage of this provision 

may create the impression that the Committee is endorsing the 

politicization of these important jobs. However, sections 305(a)(2) 

(Under Secretary for Health) and 306(a) (Under Secretary for Benefits) require that the President appoint individuals to these two offices ‘‘without regard to political affiliation or activity.’’ The Committee bill would not change these requirements. 

Section 403: Modifications to existing State home authorities 

Background 

A. State veterans home per diem 

Under current law, VA operates a program in partnership with 

any State that has, or wishes to construct, a long-term care facility 

for veterans (hereinafter, ‘‘State veterans’ home’’). State veterans’

homes are constructed predominately with Federal money and are 

maintained with Federal assistance largely for the purpose of providing care to older veterans. Under the terms of the State veterans’ home program, VA provides a fixed daily payment, known 

as a per diem, to the State for each veteran provided care in a 

State veterans’ home. It is then left to each State to determine how 

to fund the remaining costs of caring for the residents. Some States 

charge individual veterans the balance of the cost of care. Others 


bajohnson on PROD1PC77 with REPORTS
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provide financing to the State veterans’ home from the State’s general revenue tax funds. Many even accept and bill Medicare or 

Medicaid for those residents who qualify. The VA per diem is provided regardless of the source of other revenue and irrespective of 

the service-connected condition or the economic status of the veteran. 

In 1999, Public Law 106–117, the Veterans’ Millennium Health 

Care and Benefits Act, was enacted. That law, among other things, 

established a statutory requirement for VA to provide institutional 

long-term care to any veteran in need of such care for a serviceconnected condition, and to any veteran in need of such care who 

is also rated 70 percent or more disabled by VA. When VA provides 

these services in a VA nursing home or a private nursing care facility with which VA has a contract, the care is provided at no cost 

to the veteran. However, when the care is provided in a State veterans’ home, VA pays only the per diem to the State, which then 

often bills the veteran for the remaining costs. The Committee believes this is unfair and irrational. 

The policy is irrational because under its current strictures a veteran can obtain long-term care for a service-connected condition in 

a facility owned by VA, or in a private facility under contract with 

VA, at no cost. However, if that same veteran receives the services 

in a State veterans’ home, the patient will likely be charged outof-pocket expenses because VA will only provide a per diem for his 

or her care. The Committee sees no reason to continue a policy that 

financially discourages veterans from using long-term care facilities 

constructed primarily for their use. 

Even if the economics of this policy does not discourage veterans 

from using a State veterans’ home, it is certainly unfair that the 

Federal government assumes 100 percent of the cost of care for 

these veterans in two settings, but not the third. The Committee 

believes this argument alone constitutes a sufficient justification to 

change the law. 

B. Prescription medications for veterans in State veterans’

homes 

In 1996, Public Law 104–262, the Veterans’ Health Care Eligibility Reform Act of 1996 (hereinafter, ‘‘Eligibility Reform Act’’) created a standard health care benefits package, which includes comprehensive medication coverage. In general, current law requires 

that prescriptions for medications be filled only on the written 

order of a physician employed by VA. However, there is an exception to that general requirement. The exception is that VA is required to provide medications on the order of any licensed physician to 1) veterans who are in receipt of additional disability compensation payments under chapter 11 of title 38, United States 

Code, on account of being permanently housebound, or in need of 

regular aid and attendance, due to a service-connected condition, or 

2) veterans who are in receipt of non-service-connected pension 

payments under chapter 15 of title 38, and who are permanently 

housebound or in need of regular aid and attendance. Because veterans residing in State veterans’ homes who are receiving VA pension under chapter 15 of title 38 are, by definition, receiving regular aid and attendance, this requirement creates a situation 

where, in some circumstances, VA is required to provide medicaVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00030 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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tions to certain non-service-connected pension recipients who reside 

in State veterans’ homes, but cannot provide medications to some 

veterans with severe service-connected conditions who reside in the 

same State veterans’ home. The Committee believes that is simply 

irrational. 

Furthermore, under VA’s comprehensive medication coverage, 

service-connected veterans rated 50 percent or higher are not required to make co-payments for needed medications received on an 

outpatient basis. Such veterans who are enrolled for care at VA, or 

who are in receipt of care at community nursing homes paid for by 

VA, can receive VA’s full medication benefit at no charge as part 

of their care. However, as previously mentioned, service-connected 

veterans residing in a State veterans’ home are not eligible to receive the medication benefit, even if they have a disability rating 

of 50 percent or higher, unless their service-connected disability necessitated the State home care. Pharmacy costs—in addition to the 

other out-of-pocket costs described above—are levied upon these 

veterans. Similar to the current policy regarding per diem payments, the Committee believes this policy is quite inequitable. 

C. Rural access to State veterans’ homes 

As noted above, under current law, VA provides a per diem payment for each veteran who receives care in a State veterans’ home. 

This means that in order to establish beds to provide care and 

services to veterans (and receive the per diem) a State must construct an entire facility dedicated to that purpose. While it is true 

that VA provides 66 percent of the cost of construction for a State 

veterans’ home, the State must still contribute one-third of the cost 

and agree to operate the home far into the future. Over 100 State 

veterans’ homes have been constructed under this arrangement. 

Unfortunately, in the case of rural and remote areas of the country, 

major construction of a State veterans’ home would likely provide 

too many beds for too few veterans. In other words, it would be inefficient. Still, long-term care needs persist in rural areas of the 

country. 

Committee bill 

Section 403 of the Committee bill would put service-connected 

veterans receiving State veterans’ home care on a level playing 

field with other veterans, regardless of the setting in which needed 

nursing home care is provided, by requiring VA to reimburse State 

veterans’ homes for the cost of care of a veteran with a 70 percent 

or greater service-connected condition. 

Section 403 also would require VA to provide, at no cost, prescription medication coverage for veterans with a 50 percent or 

greater service-connected disability. The Committee notes that existing regulations require that all State veterans’ homes in receipt 

of a VA per diem payment retain the services of a pharmacist and 

provide all pharmaceutical services, including procedures that ensure the accurate acquisition, receipt, dispensation, and administration of drugs and biologicals to meet the needs of its residents. 

Therefore, State veterans’ homes should have no trouble implementing this provision of the Committee bill. 

Finally, section 403 would authorize a 3-year pilot program that 

would allow VA to deem a total of 100 beds in non-VA facilities to 


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be eligible for State veterans’ home per diem payments. By design, 

the limited scope and duration of the program would ensure that 

the new authority does not begin to drive the State veterans’ home 

program from its primary focus of construction and maintenance of 

separate homes for veterans, or put an unanticipated strain on 

VA’s budget due to a sudden proliferation of beds in non-VA facilities across the country. The Committee intends to assess the interest in the pilot program from States around the country, and plans 

to follow its progress closely. The Committee also intends to consult 

with all interested stakeholders prior to any decision to re-authorize or expand the pilot program. 

Section 404: Office of Rural Health 

Background 

During the past 8 years, VA has greatly expanded its network 

of individual sites for the delivery of health care services. Sites of 

care across the country now number over 1,000. The vast majority 

of these sites are community-based outpatient clinics, which have 

opened in downtown, urban communities and, increasingly, in suburban settings. 

While these new sites of care are providing more services to more 

people closer to their homes, they are exacerbating the divide between those who live close to a VA site of care and those who do 

not. It is increasingly only those veterans who reside in rural areas 

of the country who cannot receive VA-provided care from a facility 

in close proximity to home. 

Health care access in rural communities is a challenge not only 

confronting veterans who seek to use the VA health care system. 

Rural health access is a problem for many Americans and has been 

a long-time concern of Congress. Still, while Congress has provided 

funding and programs to assist the private medical system with 

the construction of health care facilities in rural communities, the 

training of physicians, nurses, and other providers to work in those 

communities, and even provided subsidies to encourage workers to 

move to remote locations, services provided by VA to veterans in 

rural areas remain sparse. 

The Committee acknowledges that moving more facilities or services to rural communities presents challenges. Facilities must have 

a large enough patient base to justify their existence or those facilities will be extremely inefficient and fiscally questionable investments. On the other hand, services purchased directly from community providers carry the risks of budget over-extension and a 

lack of care continuity. 

Committee bill 

Section 404 of the Committee bill would create an Office of Rural 

Health in the Office of the Under Secretary for Health. The purpose of the Office of Rural Health would be to assist the Committee 

and VA health officials with the collection of data on, and the development of strategies for, many of the issues outlined above. The 

Committee expects that VA will devote time and attention, through 

this Office of Rural Health, to develop new and creative solutions 

that may ultimately help reduce the service divide between rural 

and non-rural veterans that is growing with each passing year. 


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Section 405: Pilot program on improvement of caregiver assistance 

services 

Background 

VA currently administers a number of services that are geared 

towards providing support to severely disabled or aging veterans, 

and the families of those veterans, who can no longer care for 

themselves but who do not want to be cared for in an institutional 

setting. These programs include, but are not limited to: adult-day 

care, respite care, case management and coordination, transportation services, home care services, hospice, and general caregiver 

support, such as education and training of family members. 

Committee bill 

Section 405 of the Committee bill would require VA to conduct 

a 2-year pilot program to improve assistance provided to caregivers, particularly in home-based settings. Under this provision, 

$5,000,000 would be authorized for the purposes of carrying out the 

pilot program. The $5,000,000 for this program would be allocated 

in addition to whatever other funds VA is already spending on 

caregiver assistance services. The goal of this pilot program would 

be to encourage VA providers in the field to initiate their own 

versions of support services for caregivers in areas where such 

services are needed and where there are few other options available for families of disabled or aging veterans, particularly in rural 

or geographically isolated areas of the country. The Committee 

seeks to assist VA in building its non-institutional long-term care 

capacity and believes this pilot program would be one innovative 

way to do so. 

The section 405 pilot program is modeled after a program established through section 116 of Public Law 106–117. That program 

expanded and enhanced mental health services for veterans, and it 

has led to innovations in the treatment of veterans who suffer from 

mental illnesses and disorders. It is the Committee’s hope that the 

program that would be established under section 405 will have 

similar results, and that new initiatives will arise from it that will 

be valuable to the overall VA system. 

Section 405 would also require a report to Congress on the pilot 

program. The report would contain a detailed assessment of the 

program’s implementation, allocation of funds in support of the program, and results of the program. 

Section 501: Reaffirmation of national goal to end homelessness 

among veterans 

Background 

Public Law 107–95, the Homeless Veterans Comprehensive Assistance Act of 2001 (hereinafter, ‘‘HVCA Act’’), established a goal 

to end homelessness among veterans within a decade of its enactment. The HVCA Act aimed to achieve the goal through: improved 

cooperation and coordination among Federal agencies with similar 

missions to stem or end homelessness; accountability of those agencies for achieving their mission; education of the homeless population to provide greater opportunities for work and earned income; 


bajohnson on PROD1PC77 with REPORTS
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and the establishment of programs to prevent homelessness among 

veterans. 

Committee bill 

Section 501 of the Committee bill reiterates the goal of Congress 

to end homelessness among veterans within the time frame established under the HVCA Act. The Committee recognizes this is an 

ambitious goal. However, the Committee believes that it is a goal 

worth aggressively pursuing and commits to that pursuit with this 

and subsequent provisions within Title V of the Committee bill. 

Section 502: Sense of Congress on the response of the Federal Government to the needs of homeless veterans 

Committee bill 

Section 502 of the Committee bill provides a complete list of concerns and views of the Committee on the needs of homeless veterans in America and outlines the Committee’s concerns with the 

Federal government’s response to those needs. 

Section 503: Authority to make grants for comprehensive service 

programs for homeless veterans 

Background 

VA operates a Homeless Providers Grant and Per Diem Program 

to fund community agencies providing services to homeless veterans. The program aims to help homeless veterans achieve residential stability, improve skill levels, and increase personal income. 

Only programs that offer supportive housing or service centers for 

case management, education, crisis intervention, and counseling 

are eligible for funds. 

Since 1992, when the Homeless Providers Grant and Per Diem 

Program was established, VA has been able to spur development 

of increased levels of assistance at the local level for homeless veterans living throughout the country. Indeed, grantees’ programs 

often fill existing gaps in the continuum of VA care and services, 

thus serving as an effective complement to VA’s own efforts. 

VA has been successful at leveraging new resources to increase 

the overall supply of transitional housing and other effective assistance for homeless veterans throughout the country. The only programmatic shortcomings the Committee has identified are that 

there is more interest on the part of participating providers than 

there is grant money to support those efforts, and there are some 

suburban and rural areas where attracting potential community 

agencies to participate as grantees has been a major challenge for 

VA. 

Committee bill 

Section 503 of the Committee bill would extend the authorization 

for the Homeless Grant and Per Diem Program and would increase 

the amount of funds authorized for these efforts to $130,000,000 in 

each fiscal year. 


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Section 504: Extension of treatment and rehabilitation for seriously 

mentally ill and homeless veterans 

Background 

The HVCA Act authorized VA to provide expanded services and 

programs to homeless veterans who suffer with serious and chronic 

mental illnesses. In addition to the comprehensive services available to all veterans who are homeless, the bill authorized: outreach 

services; care, treatment, and rehabilitative services, directly or by 

contract in community-based treatment facilities, including halfway 

houses; and therapeutic transitional housing assistance in conjunction with work therapy and outpatient care. 

Further, the HVCA Act authorized VA to establish centers for 

the comprehensive provision of homeless services to veterans. The 

law directed that these service centers be in at least the 20 largest 

Metropolitan Statistical Areas of the country. 

Each of the authorities above would expire on December 31, 

2006. 

Committee bill 

Section 504 of the Committee bill would extend the authority to 

operate both of these important, special programs for homeless veterans through December 31, 2011. 

Section 505: Extension of authority for transfer of properties obtained through foreclosure of home mortgages 

Background 

Under current law, VA is authorized to sell, lease, or donate to 

non-profit entities and State and local governments, housing acquired by VA as a result of foreclosure on housing financed with 

a VA-guaranteed loan if the housing will be used for the purpose 

of providing shelter and assistance to homeless veterans and their 

families. VA is also authorized to make loans to non-profit entities 

for the purpose of financing the purchase or lease of housing to provide shelter to homeless veterans. 

The law requires VA to ensure that any transactions entered into 

under this authority are not to the serious financial detriment of 

VA and that the agreements will not seriously affect the financial 

integrity of the VA loan guaranty program. 

Committee bill 

The Committee continues to support the use of foreclosed, VAowned property under the strictures and parameters that currently 

exist for its use. As such, section 505 of the Committee bill extends 

the VA’s authority for this purpose through 2011. 

Section 506: Extension of funding for grant program for homeless 

veterans with special needs 

Background 

Under current law, VA operates a program through which it 

makes grants to homeless veteran service providers specifically for 

the purpose of encouraging those entities to provide unique services 

to special needs populations. Specifically, the program is intended 

to help: women veterans, including those with dependent children; 


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36 

veterans with serious mental illness; frail and elderly veterans; and 

those with terminal illnesses. 

The Committee continues to believe that mainstream programs 

which focus on recovery, employment, and reintegration may not be 

perfectly suited for these special populations. The Committee is attuned to the challenges inherent in providing safe shelter and services for women veterans, particularly those with dependent children. It is certainly likely that medical recovery and employment 

services will not be well suited for terminally ill and frail elderly 

patients. 

Committee bill 

Section 506 of the Committee bill extends VA’s authority to operate this program through 2011 and increases the annual authorized expenditure amount to $7,000,000 through the same time period. 

Section 507: Extension of funding for homeless veterans service provider technical assistance program 

Background 

Under current law, VA operates a program to provide technical 

assistance to non-profit entities in their writing of submissions to 

VA for grants to provide services to homeless veterans. The current 

authority to provide the technical assistance expired at the end of 

2005. 

The Committee recognizes that the grant-writing process is often 

a difficult and technical exercise that can leave even the most wellintentioned, non-profit entities searching for answers to legitimate 

questions. If poorly done or understood, the answers to these technical questions may ultimately decrease the possibility of their 

grant succeeding. The Committee does not desire to keep good providers out of Federal programs because of technical difficulties with 

the grant submission process. 

Committee bill 

Section 507 of the Committee bill would authorize the continuation of the grant-application-assistance program through 2012. 

Section 508: Additional element in annual report on assistance to 

homeless veterans 

Background 

The HVCA Act established the Advisory Committee on Homeless 

Veterans (hereinafter, ‘‘Advisory Committee’’). It consists of members appointed by the Secretary representing VSOs, homeless advocates, community-based providers, previously homeless veterans, 

and experts in the areas of mental health, substance abuse, vocational rehabilitation, and permanent housing. In addition, ex-officio 

members of the Advisory Committee include the Secretaries of 

other Cabinet-level agencies with an interest or role in the elimination and prevention of homelessness among veterans. 

Among the Advisory Committee’s overarching goals is a review 

of the continuum of services provided by VA, directly or by contract, in order to improve coordination of all VA-provided services 

with those of the departments that are involved in addressing the 


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special needs of homeless veterans. Following its review of this and 

other issues, the Advisory Committee is required by statute to submit an annual report to VA. 

Committee bill 

Section 508 of the Committee bill adds as a requirement to the 

Advisory Committee’s annual report that it include findings of 

identified redundancies and gaps in government-wide, homeless assistance coordination efforts so that duplication can be eliminated 

and gaps can be filled. 

Section 509: Advisory committee on homeless veterans 

Background 

As discussed above, the Advisory Committee on Homeless Veterans includes, as ex-officio members, the Secretaries of other Cabinet-level agencies with an interest or role in the elimination and 

prevention of homelessness amongst veterans. The role of these 

members, among other things, is to review VA programs serving 

homeless veterans and to assess VA’s coordination with housing 

and services provided by other Federal agencies. The current authority for the Advisory Committee expires on the December 31, 

2006. 

Committee bill 

Section 509 of the Committee bill would add two new ex-officio 

members to the Advisory Committee: the Under Secretaries of 

Health and Benefits, who both have operational responsibility for 

VA’s homeless programs. Section 509 would also add the Executive 

Director of the President’s Interagency Council on Homelessness as 

a member to the Advisory Committee to improve the Committee’s 

agency-wide coordination and oversight responsibilities. Finally, 

section 509 would authorize the Advisory Committee’s continuation 

through September 30, 2011. 

Section 510: Rental assistance vouchers for Veterans Affairs supported housing program 

Background 

The HVCA Act codified the existing Departments of Housing and 

Urban Development and Veterans Affairs Supported Housing 

(hereinafter, ‘‘HUD–VASH’’) program, which the two departments 

had been operating since 1992. In this coordinated program, the 

Department of Housing and Urban Development (hereinafter, 

‘‘HUD’’) is required to set aside section 8 housing vouchers for 

homeless veterans, and VA is required to provide appropriate case 

management services for each veteran in the program. 

Committee bill 

Section 510 of the Committee bill would require HUD to set 

aside 500 rental assistance vouchers for homeless veterans in fiscal 

year 2007, 1,000 vouchers in fiscal year 2008, 1,500 vouchers in fiscal year 2009, 2,000 vouchers in fiscal year 2010, and 2,500 vouchers in fiscal year 2011. In addition, section 510 would require VA 

to report to the Committees on Veterans’ Affairs in both the House 

of Representatives and the Senate on the effectiveness of the 


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HUD–VASH program in comparison with other VA homeless programs. It is the Committee’s hope that this report will confirm that 

the goals of eliminating any existing duplication among homeless 

assistance programs, and fully utilizing programs with a record of 

success, have been, or soon will be, successfully accomplished. 

Section 511: Financial assistance for supportive services for very 

low-income veteran families in permanent housing 

Background 

Poor, disabled, frail or elderly veterans, and poor veterans who 

reside in rural areas that are long distances from centrally-located 

services, are among a population of poverty-level veterans (as defined by the HUD ‘‘very low income index’’) who, while not yet 

‘‘homeless’’ as it is customarily defined, are certainly at risk of becoming homeless. Notably, the U.S. Census Bureau has estimated 

that 400,000 children live in households with poverty-level veterans. These at-risk veterans and their families are capable of benefitting from supportive services in home-based settings, but because they are not yet homeless, they do not likely qualify for traditional homeless assistance services. With the scarcity of homeless 

shelters and transitional housing units that are safe and appropriate for children, the Committee believes it is appropriate to invest in programs that can be an optimal aid for veterans who are 

committed to retaining their independence and self-sufficiency, 

while keeping their families intact. 

Committee bill 

Section 511 of the Committee bill would establish a new VA program to provide supportive services to poverty-level veterans in 

their homes to help keep those veterans from becoming homeless. 

For this purpose, it would authorize $15 million for fiscal year 

2007, $20 million for fiscal year 2008, and $25 million for fiscal 

year 2009, with up to $750,000 to be made available annually for 

technical assistance. The funding would be used to provide financial assistance to non-profit, faith-based and consumer cooperatives 

so that they may provide and coordinate supportive services to help 

keep low-income veterans in permanent housing. The supportive 

services would include physical and mental health services, if they 

are not readily available at a nearby VA facility; personal financial 

planning; vocational counseling, assistance in obtaining health insurance; income support and veterans’ benefits application services; 

transportation and educational services; and rehabilitation services. 

In addition, section 511 of the Committee bill would require VA 

to equitably distribute the program’s financial assistance across geographic regions, including rural communities. It would require 

training and technical assistance to be provided to eligible entities 

for planning, development, and the provision of supportive services 

to very low-income veteran families occupying permanent housing. 

Finally, section 511 would require a report on the effectiveness of 

this new program at preventing homelessness. 


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Section 601: Residential cooperative housing units 

Background 

Under the provisions of chapter 37 of title 38, United States 

Code, VA is authorized to guarantee loans for eligible veterans and 

survivors to buy or build a home; to buy a residential condominium; to repair, alter or improve a home; to refinance an existing home loan; to buy a manufactured home with or without a lot; 

to buy and improve a manufactured home lot; to install a solar 

heating or cooling system or other weatherization improvements; or 

to buy a home and install energy-efficient improvements. There is 

no authority in law for VA to guarantee loans to purchase stock in 

a cooperative housing corporation (hereinafter, ‘‘co-op’’). 

A co-op is a legal entity that owns real estate, typically residential buildings. Owners who purchase shares in a co-op are entitled 

to occupy a specific housing unit within the co-op. In addition to 

making payments on loans used to purchase shares in a co-op 

(hereinafter, ‘‘share loans’’), owners are responsible for paying 

monthly carrying charges to cover the co-op’s debt, maintenance, 

and other expenses. According to the National Association of Housing Cooperatives, in written testimony for the record submitted for 

the Committee’s June 8, 2006, hearing, ‘‘[o]ver 1.2 million families 

now live in townhouse and apartment housing co-ops in 30 states, 

the District of Columbia, and Puerto Rico.’’

The Federal Housing Administration has had authority for over 

25 years to insure share loans. VA has no authority to guaranty 

share loans for veterans under its loan guaranty program. The 

Committee received testimony in association with its June 8, 2006, 

hearing in support of legislation to allow VA to guarantee share 

loans. Mr. David Greineder, Deputy National Legislative Director 

for AMVETS, submitted the following testimony: ‘‘Co-ops make up 

the vast percentage of affordable housing in large cities and are 

usually less expensive than a condo or other unit. This legislation 

would give veterans greater housing choice by allowing them to use 

their hard-earned benefits to buy a co-op if they prefer.’’ Also submitting testimony in support of S. 2121 were VFW, PVA, and DAV. 

In addition, the Mortgage Bankers Association and the National 

Association of Realtors submitted letters of support. 

Committee bill 

Section 601 of the Committee bill would authorize VA to guarantee loans for the purchase of stock or membership in a co-op. To 

ensure that the interests of veterans are protected, section 601 

gives VA the authority to prescribe in regulations criteria that a coop development, project, or structure must comply with before VA 

can guarantee a share loan. 

Section 602: Increase in supplemental insurance for totally disabled 

veterans 

Background 

The Insurance Act of 1951 established the Service-Disabled Veterans’ Insurance (hereinafter, ‘‘S–DVI’’) program for veterans with 

service-connected disabilities. The purpose of the S–DVI program is 

to provide veterans who, because of the nature of their disabilities, 


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may not qualify for, or be able to afford, commercial life insurance 

policies. The S–DVI coverage limit has remained at $10,000 since 

the program’s inception in 1951. Veterans who are rated as totally 

disabled by VA are eligible for waivers of premiums for the basic 

$10,000 coverage. 

In an attempt to allow certain service-connected veterans to supplement their S–DVI life insurance coverage, the Veterans’ Benefits 

Act of 1992, Public Law 102–568, was enacted to provide for 

$20,000 of supplemental coverage (hereinafter, ‘‘supplemental S–

DVI’’). Veterans are eligible for supplemental S–DVI if they meet 

three criteria: 1) be eligible for a waiver of premiums due to total 

disability, 2) apply for supplemental S–DVI within 1 year from the 

time the waiver of premiums was granted, and 3) be under age 65. 

However, unlike the $10,000 basic coverage, premiums may not be 

waived for supplemental S–DVI. Premiums on supplemental S–DVI 

cover about two-thirds of the death benefit cost; the government 

covers the remaining costs. 

In 2001, a Congressionally mandated study, Program Evaluation 

of Benefits for Survivors of Veterans with Service-Connected Disabilities, recommended that the basic S–DVI coverage limit be increased from $10,000 to $50,000. The study based its recommendation on data which show that, on average, for all surviving spouses 

of S–DVI policy holders, total household income decreased from 

about $48,840 to $27,300 in the year after the policy holder’s, i.e., 

the veteran’s, death. The study concluded that basic S–DVI coverage limits should cover the loss of income for at least 2 years 

after a veteran’s death. Thus, in order to meet the study’s recommendation for totally disabled S–DVI policy holders, supplemental S–DVI would need to be increased by $20,000 to allow for 

an aggregate coverage limit of $50,000 ($10,000 in basic coverage 

and $40,000 in supplemental S–DVI). 

Totally disabled veterans would benefit from the availability of 

higher supplemental S–DVI coverage amounts. This was reaffirmed 

in a July 28, 2005, letter from Secretary R. James Nicholson to the 

Committee Chairman regarding the administration’s position on S. 

1252: 

In our view, the current aggregate S–DVI coverage of 

$30,000 is insufficient to meet disabled veterans’ life insurance needs. S. 1252 would increase the financial security 

of disabled veterans by affording them the opportunity to 

purchase additional life insurance coverage otherwise not 

available to them. 

Committee bill 

Section 602 would provide for a $10,000 increase in the amount 

of supplemental S–DVI available to totally disabled S–DVI policy 

holders. The increase would be effective from October 1, 2007, until 

September 30, 2011. Veterans who purchase the higher level of 

supplemental S–DVI during this period would be able to retain the 

higher level of coverage, assuming continued payment of applicable 

premiums. 


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Section 603: Reauthorization of use of certain information from 

other agencies 

Background 

Section 5317 of title 38, United States Code, directs VA to notify 

applicants for needs-based VA benefits, such as VA pension, that 

information collected from the applicants may be compared with income-related information obtained by VA from the Internal Revenue Service and the Department of Health and Human Services. 

The authority for VA to obtain such information expires on September 30, 2008. 

Section 6103(l)(7) of the Internal Revenue Code authorizes the 

release of income information by the Internal Revenue Service to 

VA. This authority expires on September 30, 2008. 

Committee bill 

Section 603 would extend until September 30, 2011, the authority of VA to obtain income information under section 5317 of title 

38, and the authority of the Internal Revenue Service to share income information under section 6103(l)(7) of the Internal Revenue 

Code. 

Section 604: Clarification of correctional facilities covered by certain 

provisions of law 

Background 

Under section 5313 of title 38, United States Code, there is a 

limitation on the payment of VA compensation to an individual incarcerated in a ‘‘Federal, State, or local penal institution’’ for more 

than 60 days for conviction of a felony. In Wanless v. Principi, the 

CAVC directed VA to specifically address the question of whether 

the section 5313 limitation applies to a felon incarcerated—at the 

expense of the government—in a facility that is owned and operated by a private contractor (Wanless v. Principi, 18 Vet. App. 337, 

338 (2004)). In a concurring opinion, it was suggested that the 

phrase ‘‘Federal, State, or local penal institution’’ would not encompass a privately owned and operated correctional facility. After the 

CAVC issued Wanless, VA requested—but has not received—an 

opinion from the VA General Counsel on the issue posed by the 

CAVC. 

In recent years, there has been significant growth in the number 

of government entities utilizing penal facilities that are operated by 

private contractors. This growth may lead to further litigation over 

whether the current language of section 5313 encompasses private 

prisons. If VA or the courts were to conclude that private prisons 

do not constitute a ‘‘Federal, State, or local penal institution,’’ as 

the CAVC has suggested, there would be the anomalous situation 

of the section 5313 limitation applying to a felon in a publicly operated facility and not to a felon incarcerated for the same crime in 

a privately operated facility. 

Committee bill 

Section 604 of the Committee bill would make a technical amendment to title 38, United States Code, to clarify that the section 

5313 limitation applies to a felon incarcerated in any type of penal 


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facility, including facilities operated by a private contractor. It 

would make the same change in other title 38 sections that currently have the phrase ‘‘Federal, State, or local penal institution.’’

COST ESTIMATE

In compliance with paragraph 11(a) of rule XXVI of the Standing 

Rules of the Senate, the Committee, based on information supplied 

by the Congressional Budget Office (hereinafter, ‘‘CBO’’), estimates 

that enactment of the Committee bill would, relative to current 

law, increase direct spending for veterans’ programs by less than 

$500,000 in fiscal year 2007, but decrease such spending by $6 million over the fiscal year 2007–2011 period, and by $5 million over 

the 2007–2016 period. In addition, CBO projects discretionary 

spending resulting from S. 2694 at $186 million in fiscal year 2007 

and $1.1 billion over the 2007–2011 period, assuming appropriation 

of the necessary amounts. Enactment of the Committee bill would 

not affect the budget of State, local, or tribal governments. 

The cost estimate provided by CBO, setting forth a detailed 

breakdown of costs, follows: 

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, July 19, 2006. 

Hon. LARRY E. CRAIG, 

Chairman, Committee on Veterans’ Affairs, 

United States Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 2694, the Veterans’ Choice 

of Representation and Benefits Enhancement Act of 2006. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Sunita D’Monte. 

Sincerely, 

DONALD B. MARRON, 

Acting Director. 

Enclosure. 

S. 2694—Veterans’ Choice of Representation and Benefits Enhancement Act of 2006 

Summary: S. 2694 would make changes to several programs at 

the Department of Veterans Affairs (VA), primarily for medical 

care. CBO estimates that implementing this bill would cost $186 

million in 2007 and almost $1.1 billion over the 2007–2011 period, 

assuming appropriation of the necessary amounts. In addition, 

CBO estimates that enacting this legislation would increase direct 

spending for veterans programs by less than $500,000 in 2007, but 

reduce it by $6 million over the 2007–2011 period and by $5 million 

over the 2007–2016 period. 

S. 2694 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) 

and would impose no costs on state, local, or tribal governments. 

State and tribal governments would benefit from provisions of this 

bill. 

Estimated cost to the Federal Government: The estimated budgetary impact of S. 2694 is summarized in Table 1. The costs of this 


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43 

legislation fall within budget function 700 (veterans benefits and 

services). 

TABLE 1. ESTIMATED BUDGETARY IMPACT OF S. 2694, THE VETERANS’ CHOICE OF 

REPRESENTATION AND BENEFITS ENHANCEMENT ACT OF 2006 

By fiscal year, in millions of dollars— 

2007 2008 2009 2010 2011 

CHANGES IN SPENDING SUBJECT TO APPROPRIATION 

Estimated Authorization Level ...................................................................... 216 237 238 219 220 

Estimated Outlays ......................................................................................... 186 229 240 219 220 

CHANGES IN DIRECT SPENDING 

Estimated Budget Authority .......................................................................... * 6 2 ¥6 ¥10 

Estimated Outlays ......................................................................................... * 6 2 ¥6 ¥10 

Note.—* = Less than $500,000. 

Basis of estimate: For this estimate, CBO assumes that the bill 

will be enacted near the start of fiscal year 2007 and that the necessary amounts will be appropriated for each year. Most of the legislation’s budgetary effects would fall within the discretionary 

spending category, but a few provisions would affect direct spending. 

Spending subject to appropriation 

S. 2694 would affect VA programs for homeless veterans, nursing 

home care, readjustment benefits, and burial benefits. CBO estimates that implementing this bill would cost $186 million in 2007 

and almost $1.1 billion over the 2007–2011 period, assuming appropriation of the necessary amounts (see Table 2). 

Medical Care. Titles IV and V of S. 2694 would make several 

changes to VA programs, primarily for nursing home care and 

homeless veterans. CBO estimates those provisions would cost 

about $1 billion over the 2007–2011 period, assuming appropriation 

of the necessary amounts. 

TABLE 2. CHANGES IN SPENDING SUBJECT TO APPROPRIATION UNDER S. 2694 

By fiscal year, in millions of dollars— 

2007 2008 2009 2010 2011 

MEDICAL CARE 

Assistance for Homeless Veterans: 

Authorization Level ............................................................................... 153 158 163 138 138 

Estimated Outlays ................................................................................ 131 157 161 139 138 

State Veterans’ Nursing Homes Payments and Benefits: 

Estimated Authorization Level ............................................................. 58 66 69 70 71 

Estimated Outlays ................................................................................ 52 62 68 69 71 

Pilot Programs to Assist Caregivers of Veterans: 

Authorization Level ............................................................................... 5 0 0 0 0 

Estimated Outlays ................................................................................ 3 1 1 0 0 

Subtotal–Medical Care: 

Estimated Authorization Level .................................................... 216 224 232 208 209 

Estimated Outlays ....................................................................... 186 220 230 208 209 

READJUSTMENT BENEFITS 

Estimated Authorization Level ...................................................................... 0 6 6 11 11 

Estimated Outlays ......................................................................................... 0 6 6 11 11 

BURIAL BENEFITS 

Estimated Authorization Level ...................................................................... * 7 0 0 0 


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TABLE 2. CHANGES IN SPENDING SUBJECT TO APPROPRIATION UNDER S. 2694—Continued 

By fiscal year, in millions of dollars—

2007 2008 2009 2010 2011 

Estimated Outlays ......................................................................................... * 3 4 0 0 

Total Changes in Spending Subject to Appropriations Under S. 

2694: 

Estimated Authorization Level .................................................... 216 237 238 219 220 

Estimated Outlays ....................................................................... 186 229 240 219 220 

Note.—* = Less than $500,000. 

Assistance for Homeless Veterans. Title V would create or extend 

authorization for several programs intended to assist homeless veterans. These provisions would increase VA spending by about $130 

million in 2007 and $725 million over the 2007–2011 period, assuming appropriation of the authorized amounts. In addition, section 505 would extend a mandatory program that allows for the 

transfer of properties to nonprofit organizations for use as homeless 

shelters. (CBO’s estimate for the cost of this program is discussed 

below in the ‘‘Direct spending’’ section.) 

Grants for Comprehensive Service Programs. Section 503 would 

provide VA with permanent authority to give grants to organizations that provide comprehensive service programs for homeless 

veterans. The prior authorization for this program expired in September of 2005. This section would authorize the appropriation of 

$130 million per year. Based on historical spending patterns for 

this program, CBO estimates that implementing this section would 

cost $117 million in 2007 and about $630 million over the 2007– 2011 period. 

Assistance to Very Low-Income Families. Section 511 would require VA to provide financial assistance to organizations that help 

families of very low-income veterans who are living in, or about to 

move in to, permanent housing. This section would authorize appropriations for this program of $15 million in 2007, $20 million in 

2008, and $25 million in 2009. CBO expects that it will take at 

least one year for the program to be established and provide 

grants. We estimate that implementing this program would cost $7 

million in 2007 and about $60 million over the 2007–2011 period. 

Grants for Special Needs Veterans. Section 506 would reauthorize 

funding from 2007 through 2011 for a grants program for homeless 

veterans with special needs, such as women, the elderly, and the 

mentally ill. (No funding was provided for this program in 2006.) 

Based on the authorized amount of $7 million per year, CBO estimates that implementing this section would cost $6 million in 2007 

and about $34 million over the 2007–2011 period. 

Technical Assistance Grants for Service Providers. Section 507 

would reauthorize through 2012 a program that provides technical 

assistance grants for organizations that help homeless veterans. 

Section 507 would authorize the appropriation of $1 million per 

year through 2012. CBO estimates that implementing this section 

would cost about $1 million in 2007 and $5 million over the 2007–

2011 period. 

State Veterans’ Nursing Homes Payments and Benefits. Section 

403 would modify VA payments to state-run nursing homes for veterans and the provision of VA benefits to the veterans who are paVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00044 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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tients in those homes. In total, implementing section 403 would 

cost $52 million in 2007 and $322 million over the 2007–2011 period, assuming appropriation of the necessary amounts. 

Increased Payments to State Nursing Homes. Under current law, 

VA pays state nursing homes for veterans a daily allowance to care 

for certain veterans. In 2006, that rate is $63.40 per veteran. Section 403 would require VA to pay state nursing homes for the full 

cost of care for veterans who have a service-connected disability 

rating of 70 percent or more. Based on information from VA and 

from the National Association of State Veterans Homes, CBO estimates that it costs the states about $200 a day to care for each veteran and that there are about 1,000 veterans in state homes whose 

disability ratings are 70 percent or more. Thus, CBO estimates 

that enacting this provision would cost $48 million in 2007 and 

about $280 million over the 2007–2011 period, assuming appropriation of the necessary amounts. This estimate assumes that the 

daily cost will rise at an average inflation rate of about 4 percent. 

Because the amount VA currently pays the state nursing homes 

for veterans does not cover the full cost of care, the homes must 

also collect money from the veterans themselves and, depending on 

the state, from other federal government sources and the state 

itself. If the Congress appropriates the full amount necessary to 

allow VA to pay for the complete costs for these veterans’ care, it 

is likely that there will be a reduction in the amount of Medicaid 

funds used to cover the costs of care. Based on the current estimated portion of the cost that is paid for by Medicaid funds, CBO 

estimates that there could be potential savings to the federal government of about $5 million per year. (Such savings are contingent 

upon appropriation of the amounts necessary to implement this 

section.) 

Hospital Beds Treated as Nursing Home Beds. Section 403 would 

also allow VA to treat up to 100 beds found in health facilities such 

as hospitals as nursing home beds for the purposes of making payments to cover the costs of care for veterans. No new beds could 

be added to this program after fiscal year 2009. Based on an estimated average cost of care of $250 per day in 2007, and allowing 

one year for the program to reach full capacity, CBO estimates that 

implementing this provision would cost about $4 million in 2007 

and $40 million over the 2007–2011 period, assuming appropriation 

of the necessary amounts. 

Filling Prescriptions for Veterans in State Nursing Homes. Finally, section 403 would require that VA furnish prescription medicines to veterans with a service-connected disability rating of 50 

percent or more who reside in state nursing homes. Under current 

law, VA can only fill prescriptions for those veterans who are enrolled in the VA medical care system and have prescriptions written by VA doctors. Based on data from VA about the percentage 

of veterans eligible for this benefit who are already enrolled in 

their system, CBO estimates that implementing this provision 

would cost less than $500,000 per year. 

Pilot Program to Assist Caregivers of Veterans. Section 405 would 

require the Secretary to create a two-year program to provide funds 

to VA medical facilities to assist those caring for veterans by providing services such as adult daycare programs, transportation 

services, and hospice care. This section would authorize the spendVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00045 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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ing of not less than $5 million on the pilot program. CBO estimates 

that implementing this provision would cost $3 million in 2007 and 

$5 million over the duration of the program. 

Readjustment Benefits. VA is authorized to reimburse agencies that approve courses for veterans’ readjustment (education) 

benefits for certain of the costs they incur in their certification efforts. Those agencies—known as state approving agencies—are offices designated by each state to provide the VA with a list of approved courses provided by educational institutions in their states. 

Under current law, VA may reimburse the agencies from funds 

available for the payment of readjustment benefits by a total of $19 

million in both 2006 and 2007, and $13 million each year thereafter. 

Section 303 would increase the amount VA may pay the agencies 

to $19 million a year for all years, but would reduce the amount 

VA could draw for that purpose from funds available for the payment of readjustment benefits to $8 million a year for 2010 through 

2013. VA would be authorized to use funds, subject to the availability of appropriations, to make up the difference between the full 

amount authorized and the amount that could be paid from funds 

for readjustment benefits. CBO estimates that implementing this 

provision would have no cost in 2007 but would cost $34 million 

over the 2008–2011 period, assuming appropriation of the estimated amounts. (The effect of this section on readjustment benefits 

is discussed under the ‘‘Direct spending’’ section.) 

Burial Benefits. Section 201 would allow VA to provide grants 

to tribal organizations to establish, expand, or improve veterans’

cemeteries on trust lands owned by the tribal organizations. Under 

current law, VA can only provide grant money to states for the purposes of establishing, expanding, or improving a veterans’ cemetery. Based on information from VA, state cemetery grants range 

from $4 million to $7 million, depending on the size of the project, 

with an average time of 24 months to establish a cemetery from 

design to opening. CBO expects that one such request for a cemetery would be made over the 2007–2011 period, and estimates that 

implementing section 201 would cost $7 million over that period, 

subject to appropriation of the necessary amounts. 

Section 202 would require the Secretary of the Army to remove 

the remains of Russell Wayne Wagner, a convicted murderer, from 

Arlington National Cemetery and return his remains to his family. 

Based on information from VA, CBO estimates that implementing section 202 would cost less than $100,000 in 2007, subject 

to the availability of appropriated funds. 

Direct spending 

S. 2694 contains provisions that would both increase and decrease direct spending for veterans programs. On balance, CBO estimates enacting this legislation would increase direct spending for 

veterans programs by less than $500,000 in 2007, but reduce it by 

$6 million over the 2007–2011 period and by $5 million over the 

2007–2016 period (see Table 3). 


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TABLE 3. CHANGES IN DIRECT SPENDING UNDER S. 2694 

Outlays by fiscal year, in millions of dollars—

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

COMPENSATION, PENSIONS, AND BURIAL BENEFITS 

Income Verification Extension ......................... 0 0 ¥5 ¥9 ¥13 0 0 0 0 0 

Supplemental Service Disabled Veterans Insurance ....................................................... 0 2 3 3 3 2 2 2 2 2 

Grave Markers ................................................. * * * * * * * * * * 

Subtotal-Compensation, Pensions, and 

Burial Benefits ................................... * 2 ¥2 ¥6 ¥10 2 2 2 2 2 

READJUSTMENT BENEFITS 

Accelerated Payments of MGIB ....................... 0 3 3 4 4 0 0 0 0 0 

Accelerated Payments for Survivors and Dependants ..................................................... 0 1 1 1 1 0 0 0 0 0 

State Approving Agencies ............................... 0 0 0 ¥5 ¥5 ¥5 ¥5 0 0 0 

Subtotal-Readjustment Benefits ............ 0 4 4 0 0 ¥5 ¥5 0 0 0 

Total Changes in Direct Spending 

Under S. 2694 ........................... * 6 2 ¥6 ¥10 ¥3 ¥3 2 2 2 

Notes.—MGIB = Montgomery GI Bill; * = Less than $500,000. 

Compensation, Pensions, and Burial Benefits. Several sections of the bill would affect veterans benefits for disability compensation, pensions, life insurance, and burial benefits. CBO estimates that implementing these provisions would increase direct 

spending for veterans programs by less than $500,000 in 2007, but 

reduce it by $14 million over the 2007–2011 period and by $3 million over the 2007–2016 period. 

Income Verification Extension. Section 603 would extend authorities under current law that allow VA to acquire information on income reported to the Internal Revenue Service (IRS) to verify income reported by recipients of VA pension benefits. The authorization allowing the IRS to provide income information to VA will expire on September 30, 2008, as will the authorization allowing VA 

to acquire the information. Section 603 would extend these authorities through September 30, 2011, for both VA and the IRS. Because 

current law allows VA and the IRS to conduct income verification 

through the end of fiscal year 2008, CBO estimates that enacting 

this provision would provide no savings until fiscal year 2009. 

Based on information from VA, CBO estimates that in 2009 VA 

will make approximately $5 million in pension benefit overpayments that could be prevented by verifying veterans’ incomes. 

Using that information, CBO estimates that enacting section 603 

would result in direct spending savings of $26 million over the 

2009–2011 period. 

Supplemental Service Disabled Veterans Insurance (S–DVI). Section 602 would temporarily increase the amount of supplemental 

S–DVI a veteran may purchase. S–DVI is an insurance program 

open to veterans who separated from service on or after April 25, 

1951, and who have been determined by VA to have a service-connected disability. Under current law, veterans who are eligible for 

a waiver of S–DVI premiums (totally disabled veterans) are eligible 

for an additional $20,000 in S–DVI coverage and they must apply 

within a year from notice of the grant of waiver. The premiums for 

supplemental S–DVI cannot be waived. By law, the premiums for 


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S–DVI have been held constant for many years. Since the premiums are no longer sufficient to cover the estimated death claims 

per year, the federal government now subsidizes the program. 

Section 602 would increase the amount of supplemental S–DVI 

a veteran could purchase from $20,000 to $30,000 over the period 

beginning on October 1, 2007, and ending on September 30, 2011. 

The amount of supplemental S–DVI that could be purchased would return to $20,000 after that period. However, veterans who purchased the additional coverage would be able to retain the higher 

coverage level. Based on information from VA on S–DVI accessions 

and mortality rates, CBO estimates that the number of veterans 

holding S–DVI policies will increase from about 15,000 in 2008 to 

18,000 in 2011 and then decrease to about 12,000 by 2016, and 

that about 20 percent of all policy holders would chose to purchase 

additional coverage over the specified period. CBO estimates that 

enacting section 602 would increase direct spending for insurance 

benefits by $2 million in 2008, $11 million over the 2008–2011 pe- riod, and $21 million over the 2008–2016 period. 

Grave Markers. Section 203 would allow VA to provide a marker 

or headstone to be placed on a marked grave or other appropriate 

location in a private cemetery to commemorate a veteran’s military 

service for those veterans who were buried after November 11, 

1990. 

Under current law, veterans buried in a private cemetery are eligible for a second marker or headstone only if they were buried 

after September 11, 2001. 

Section 203 would also indefinitely extend the period during 

which a marker or headstone could be requested. The authority for 

VA to provide government headstones or markers to veterans buried in private cemeteries currently expires on December 31, 2006. 

Based on VA projections about future deaths and burials in private cemeteries, CBO estimates that about 20,000 requests for 

headstones or markers would be made over the 2007–2016 period. 

The estimate also reflects information from a VA study that 

showed that only 27 percent of private cemeteries allow second 

markers and that less than 5 percent of those eligible would participate in this program. With an average cost of about $92 for each 

marker, CBO estimates that this provision would result in an increase in spending for burial benefits of less than $500,000 in 2007, 

$1 million over the 2007–2011 period, and $2 million over the 

2007–2016 period. 

Veterans Readjustment Benefits. S. 2694 contains several 

provisions that would modify the way veterans education benefits 

are currently provided. In total, CBO estimates enacting these provisions would not change direct spending for veterans readjustment 

benefits in 2007, but would increase such spending by $8 million 

over the 2008–2011 period, and would decrease such spending by 

$2 million over the 2008–2016 period. 

Accelerated Payments of MGIB Benefits. Section 301 would expand the range of education programs eligible for accelerated payment of education benefits under the Montgomery GI Bill (MGIB). 

Under current law, veterans may receive a lump-sum payment 

equal to 60 percent of the costs for certain courses, if tuition for 

those courses exceeds twice the benefit that would otherwise be 

paid. This section would add programs leading to employment in 


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the transportation, construction, hospitality, and energy industries 

to those in high-technology industries already eligible for such payments, but would limit such expansion to the 2008–2011 period. 

Based on information from VA about the number of veterans using 

the current accelerated payment program and the number of veterans training in the transportation, construction, hospitality and 

energy fields, CBO estimates that this provision would increase direct spending for readjustment benefits by $14 million over the 

2008–2011 period. 

Accelerated Payments for Survivors and Dependants. Section 302 

would allow survivors and dependents to receive their education 

benefits using the expanded program of accelerated payments described above. These beneficiaries, who have not previously been 

allowed to receive any accelerated payments, would be eligible for 

such payments from 2008 through 2011. Based on information from 

the VA about the usage of this program by MGIB beneficiaries, 

CBO estimates that this provision would increase direct spending 

for readjustment benefits by $4 million over the 2008–2011 period. 

State Approving Agencies. VA is currently authorized to reimburse the state approving agencies from amounts available for the 

payment of readjustment benefits. The state approving agencies 

provide verification that various educational institutions are qualified to provide courses of education so that eligible veterans, survivors, and dependents may receive veterans education benefits 

while attending those institutions. Section 303 would reduce the 

amount of such reimbursements that could be provided from funds 

available for payment of readjustment benefits by $5 million a year 

from 2010 through 2013. (This provision also would authorize additional amounts to be paid to the state approving agencies subject 

to the availability of appropriations, which is discussed under the 

‘‘Spending subject to appropriation’’ section.) CBO estimates that 

enacting this provision would reduce direct spending for veterans 

readjustment benefits by $20 million over the 2010–2013 period. 

Other Provisions. The following provisions would have an insignificant impact on direct spending: 

• Section 101 would allow VA to periodically collect fees from individuals recognized as agents or attorneys when representing veterans in benefits cases so as to offset the costs VA incurs in certifying that agents or attorneys are properly qualified. CBO estimates that implementing this provision would have an insignificant net effect on direct spending because it would allow VA to 

spend the fees collected to defray such costs. 

• Section 505 would extend from 2008 through 2011, VA’s authority to sell, lease, or donate foreclosed homes to nonprofit organizations and state or local governments for use as homeless shelters for veterans. The program provides savings to VA by reducing 

its inventory of foreclosed homes, but those savings are offset by 

discounts, ranging from 20 percent to 50 percent of the estimated 

property value (roughly $90,000), that VA gives to nonprofit organizations. Because of the low volume of homes provided under this 

program—an average of 10 properties a year over the last few 

years—CBO estimates this provision would have no significant effect on direct spending for the VA home loan program. 

• Section 601 would authorize VA to guarantee loans made to 

purchase stock or membership in residential cooperatives. AccordVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00049 Fmt 6659 Sfmt 6602 E:\HR\OC\SR297.XXX SR297

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ing to VA, cooperative housing projects have unique characteristics 

such as lack of outright ownership of real property, restrictions on 

sale of stock or membership, and blanket mortgages (a mortgage 

that covers the entire cooperative project, rather than an individual 

borrower), that would, in most instances, either violate VA’s underwriting criteria or make them unsuitable for the home loan program. As a result, CBO estimates that very few loans would be 

guaranteed under this provision. 

Intergovernmental and private-sector impact: S. 2694 contains no 

intergovernmental or private-sector mandates as defined in UMRA 

and would impose no costs on state, local, or tribal governments. 

State and tribal governments would benefit from provisions of this 

bill. 

Section 201 would make tribal governments eligible for a current 

program to establish, expand, or improve veteran cemeteries. Any 

costs to those governments would be incurred as a condition of participating in a voluntary federal program. 

Section 403 would authorize the Secretary of the VA to reimburse the full costs of long-term care for certain veterans in State 

Veteran Homes. Currently, the VA reimburses about one-third of 

those costs; one-third of the remaining costs are collected from the 

veteran, and the rest is reimbursed by Medicaid or state contributions. CBO estimates that state governments could save about $10 

million annually as a result of this provision, assuming that appropriations are provided to fully fund the costs of long-term care. 

Estimate prepared by: Federal Costs: Medical Care: Michelle 

Patterson. Readjustment Benefits: Mike Waters. Compensation, 

Pensions, Burial Benefits and Other Programs: Dwayne M. Wright. 

Housing: Sunita D’Monte. Impact on State, Local, and Tribal Governments: Melissa Merrell. Impact on the Private Sector: R. Derek 

Trunkey. 

Estimate approved by: Peter H. Fontaine, Deputy Assistant Director for Budget Analysis. 

REGULATORY IMPACT STATEMENT

In compliance with paragraph 11(b) of rule XXVI of the Standing 

Rules of the Senate, the Committee on Veterans’ Affairs has made 

an evaluation of the regulatory impact that would be incurred in 

carrying out the Committee bill. The Committee finds that the 

Committee bill would not entail any regulation of individuals or 

businesses or result in any impact on the personal privacy of any 

individuals and that the paperwork resulting from enactment 

would be minimal. 

TABULATION OF VOTES CAST BY COMMITTEE

In compliance with paragraph 7 of rule XXVI of the Standing 

Rules of the Senate, the following is a tabulation of votes cast in 

person or by proxy by members of the Committee on Veterans’ Affairs at its June 22, 2006, meeting. On that date, the Committee, 

by unanimous voice vote, ordered S. 2694, as amended, a bill to 

amend title 38, United States Code, to remove certain limitations 

on attorney representation of claimants for veterans benefits in administrative proceedings before the Department of Veterans Affairs, and for other purposes, reported favorably to the Senate. 


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AGENCY REPORT

On June 23, 2005, VA’s Under Secretary for Benefits, the Honorable Daniel L. Cooper, appeared before the Committee and submitted testimony on, among other things, S. 909 and S. 1252. Additional comments were provided on S. 1252 in a letter to the Committee Chairman on July 28, 2005, from VA Secretary R. James 

Nicholson. On May 11, 2006, VA’s Deputy Under Secretary for 

Health, Dr. Michael Kussman, appeared before the Committee and 

submitted testimony on, among other things, S. 1537, S. 2433, S. 

2634, and S. 2762. On June 8, 2006, VA’s Deputy Under Secretary 

for Benefits, Ronald Aument, appeared before the Committee and 

submitted testimony on, among other things, S. 2694 as introduced, 

and also on the following additional bills from which provisions in 

S. 2694, as amended, are derived: S. 1252, S. 2121, S. 2416, and 

S. 3363. Furthermore, in a letter from the Honorable William J. 

Haynes II, General Counsel of the Department of Defense, to the 

Committee Chairman on February 9, 2006, additional views were 

provided with respect to S. 1759. Excerpts from the hearings on 

June 23, 2005, May 11, 2006, and June 8, 2006, and the February 

9, 2006, letter are reprinted below: 

STATEMENT OF DANIEL L. COOPER, UNDER SECRETARY FOR

BENEFITS, DEPARTMENT OF VETERANS AFFAIRS—JUNE

23, 2005 

Mr. Chairman and members of the Committee, I appreciate this opportunity to testify today on several bills concerning important programs administered by the Department of Veterans Affairs (VA). 

* * * * * 

S. 909 

S. 909 would expand eligibility for government markers 

by changing the applicability date of VA’s current authority to provide a marker for the private-cemetery grave of 

a veteran regardless of whether the grave has been 

marked at private expense. 

Pursuant to 38 U.S.C. § 2306(d)(1), VA is authorized to 

furnish a Government marker for the grave of an individual who is buried in a private cemetery, even if the 

gravesite is already privately marked. However, this authority extends only to individuals who died on or after 

September 11, 2001. S. 909 would authorize VA to furnish 

such markers for the graves of individuals who died on or 

after November 1, 1990. 

VA supports enactment of S. 909. Under current law, if 

a veteran died before September 11, 2001, VA is authorized to furnish a Government headstone or marker only if 

the veteran’s grave is unmarked. Although the current law 

has allowed VA to begin to meet the needs of families who 

view the Government-furnished marker as a means of honoring and publicly recognizing a veteran’s military service, 

VA is now in the difficult position of having to deny this 

recognition based solely on when a veteran died. 


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Furthermore, the law has never precluded the addition 

of a privately purchased headstone to a grave after placement of a Government-furnished marker, even though this 

practice results in double marking. In contrast, if a private 

marker is placed on a veteran’s grave in the first instance, 

a Government marker may not be provided if the veteran 

died before September 11, 2001. In our view, this creates 

an arbitrary distinction disadvantaging families who 

promptly obtained a private marker. 

For veterans who died during the period from October 

18, 1979, until November 1, 1990, when the Omnibus 

Budget Reconciliation Act of 1990 was enacted, VA may 

pay a headstone or marker allowance to those families who 

purchased a private headstone or marker in lieu of a Government headstone or marker. Therefore, those families 

also had an opportunity to benefit from the VA-marker 

program. S. 909 would, for the first time, permit families 

who bought a private marker for veterans who died between November 1, 1990, and September 11, 2001, to participate in the VA-marker program as well. 

VA estimates that enactment of S. 909 would cost 

$90,000 during FY 2006 and $225,000 over the ten-year 

period FYs 2006–2015. VA pays for headstones and markers with funds from the Compensation and Pension appropriation account. 

* * * * * 

S. 1138, S. 1252, S. 1259, S. 1271 

Unfortunately, we did not receive the text of S. 1252, the 

‘‘Disabled Veterans Insurance Improvement Act,’’ S. 1259, 

the ‘‘Veterans Employment and Transition Services Act,’’

or S. 1271, the ‘‘Prisoner of War Benefits Act of 2005,’’ in 

time to be able to state our views on those bills. We will 

be happy to provide the Committee with official views and 

estimates once the necessary executive branch coordination has been completed. S. 1138, a bill to authorize placement in Arlington National Cemetery of a monument honoring veterans who fought in World War II as members of 

Army Ranger Battalions, was also recently added to the 

hearing agenda. We will provide our comments on this bill 

to the Committee after completing necessary executive 

branch coordination. 

LETTER FROM SECRETARY OF VETERANS AFFAIRS R. JAMES

NICHOLSON

JULY 28, 2005. 

Hon. LARRY E. CRAIG, Chairman, Committee on Veterans’ Affairs, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: As requested at the June 23, 2005, 

legislative hearing before the Senate Committee on Veterans’ Affairs, I am pleased to provide the views of the Department of Veterans Affairs (VA) on those bills for which 


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53 

we did not previously submit comments, including S. 917, 

a bill to make permanent the pilot program for direct 

housing loans for Native American veterans, S. 1138, a bill 

to authorize placement in Arlington National Cemetery of 

a monument honoring veterans who fought in World War 

II as members of Army Ranger Battalions, S. 1252, the 

‘‘Disabled Veterans Insurance Improvement Act of 2005,’’

S. 1259, the ‘‘Veterans Employment and Transition Services Act,’’ and S. 1271, the ‘‘Prisoner of War Benefits Act 

of 2005.’’ VA’s views on each of these bills are discussed 

below. To the extent that VA supports enactment of aspects of these bills that have cost implications, it is assumed that the costs would be accommodated within the 

scope of the President’s budget request. 

* * * * * 

S. 1252 

S. 1252, the ‘‘Disabled Veterans Insurance Improvement 

Act of 2005,’’ would amend section 1922A of title 38, 

United States Code, to increase from $20,000 to $40,000 

the amount of supplemental life insurance available to veterans who are insured under Service-Disabled Veterans’ Insurance (S–DVI) and who qualify for waiver of premiums due to total disability. Under current law, a veteran who has a service-connected disability but is otherwise in good health may obtain up to $10,000 of S–DVI by 

applying to VA within two years from the date of being notified that the disability is service connected. 38 U.S.C. 

§§ 1903, 1922(a). VA may, upon application of an insured 

veteran, waive the payment of premiums during a period 

of continuous total disability. 38 U.S.C. §§ 1912(a), 1922(a). 

Section 1922A currently provides up to $20,000 of supplemental insurance to a disabled veteran who: (1) has basic 

S–DVI coverage; (2) has obtained a waiver of premiums on 

this coverage because he or she is totally disabled; and (3) 

applies to VA for the supplemental S–DVI coverage within 

one year of being notified by VA that he or she is entitled 

to waiver of premiums. 38 U.S.C. § 1922A(a) and (b). Waiver of premiums is not available on the supplemental coverage. 38 U.S.C. § 1922A(d). 

By increasing the amount of available supplemental S–

DVI to $40,000, S. 1252 would address a major concern of 

veterans, as shown by the Congressionally-mandated study 

Program Evaluation of Benefits for Survivors of Veterans 

with Service-Connected Disabilities. This study indicated 

that veterans were least satisfied with the maximum insurance available and that veterans deem the need for increased coverage to be most important. In our view, the 

current aggregate S–DVI coverage of $30,000 is insufficient to meet disabled veterans’ life insurance needs. S. 

1252 would increase the financial security of disabled veterans by affording them the opportunity to purchase additional life insurance coverage otherwise not available to 

them. Accordingly, VA supports S. 1252. 


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S. 1252 does not specify its scope of applicability, but we 

interpret it to apply prospectively to any veteran who is eligible to apply for and obtain supplemental S–DVI under 

section 1922A, or to change the amount of supplemental 

S–DVI coverage previously obtained, on or after the date 

of S. 1252’s enactment. Based on this interpretation, VA 

estimates that the additional coverage provided by S. 1252 

would cost $2.6 million over the five-year period FY 2006 

through FY 2010 and $9.5 million over the ten-year period 

FY 2006 through FY 2015. 

* * * * * 

The Office of Management and Budget advises that 

there is no objection to the submission of this report from 

the standpoint of the Administration’s programs. 

Sincerely yours, 

R. JAMES NICHOLSON. 

STATEMENT OF MICHAEL KUSSMAN, DEPUTY UNDER SECRETARY FOR HEALTH, DEPARTMENT OF VETERANS AFFAIRS—MAY 11, 2006 

Good Morning Mr. Chairman and Members of the Committee: 

Thank you for inviting me here today to present the Administration’s views on several bills that would affect Department of Veterans Affairs (VA) programs that provide 

veterans benefits and services. 

S. 1537 Parkinson’s Disease Research Education and 

Clinical Centers; Multiple Sclerosis Research Education and Clinical Centers 

Mr. Chairman, I will begin by addressing S. 1537. This 

bill would require VA to establish six Parkinson’s Disease 

Research, Education, and Clinical Centers (PADRECCs) 

and two Multiple Sclerosis Centers of Excellence (MS Centers). The bill prescribes detailed requirements for the centers. It would provide that any such center in existence on 

January 1, 2005, must be designated as a PADRECC or 

MS Center under this law unless the Secretary determines 

that it does not meet the bill’s requirements, has otherwise 

not demonstrated effectiveness in carrying out the purposes of a PADRECC or MS Center, or has not demonstrated the potential to carry out those purposes effectively in the reasonably foreseeable future. The centers 

would also need to be geographically distributed. Finally, 

the Secretary could designate a facility as a new 

PADRECC or MS Center only if a peer review panel finds 

that the facility meets the requirements of the law, and 

recommends designation. 

VA does not support S. 1537 because it is unnecessary; 

the Department is already in full compliance with the substantive requirements of this bill. VA recommends that 

Congress await an ongoing evaluation of the existing 

PADRECCs before it considers whether to mandate that 


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VA either continue their operation or designate new centers. Additionally, VA is concerned that statutory mandates for these ‘‘disease specific’’ centers has the potential 

to fragment care in what is otherwise a well-designed, 

world class integrated health care system. I am increasingly concerned about the proliferation of this disease specific model and its impact on patient care and VA’s integrate health care model. As it relates to a particular disease, I believe that it is much more important for VA to 

disseminate the best in evidence based practices across its 

health care system than to establish centers that provide 

care for a particular disease. 

VA currently has PADRECCs at six sites—San Francisco, California; Richmond, Virginia; Philadelphia, Pennsylvania; Houston, Texas; Los Angeles, California, and 

Puget Sound/Portland, Oregon (a combined site). Those 

sites served a total of 18,500 patients in fiscal year 2004. 

We are currently conducting an evaluation of PADRECCs’ effectiveness in disseminating best practices, impact on patient outcomes, and the types of organizational structures 

that contribute to effectiveness. The study will be completed in 2007. Until this study is complete, VA believes 

that it would be unwise to mandate continued operation of 

these or additional PADRECCs. VA will, of course, share 

the results of the evaluation with Congress to assist in determining the need for legislation in the future. 

For similar reasons, VA also does not support establishing new specialty centers for the care of veterans with 

multiple sclerosis. VA is well aware that Parkinson’s disease and multiple sclerosis are prevalent in the veteran 

population, particularly among aging veterans. However, 

the nature of battlefield injuries is changing, and VA is 

now treating many new veteran patients with complex 

polytrauma syndromes, including brain injuries, limb loss, 

and sensory loss. Treating such disorders, and the mental 

and emotional disorders that accompany them, requires an 

interdisciplinary approach that moves beyond the focus on 

a single disease. By mandating new ‘‘education, research, 

and clinical centers’’ that are disease-specific, flexibility to 

respond to changing combinations of related conditions is 

reduced. It is also important to note that the ‘‘models’’ on 

which PADRECCs and MS Centers are based, the successful Geriatric Research, Education and Clinical Center 

(GRECC) and Mental Illness Research, Education and 

Clinical Center (MIRECC) programs, were not as narrowly-focused on a disease process but addressed a wide 

gamut of issues facing a significant portion of the veteran 

population. 

S. 2433 Rural Veterans Care Act of 2006 

Mr. Chairman, S. 2433 is an ambitious measure to improve access to VA health care and other VA benefits by 

veterans living in rural and remote areas by creating a 

new Assistant Secretary who would be responsible for formulating, coordinating, and overseeing all VA benefits, 


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policies, and procedures affecting such veterans. This 

would include overseeing and coordinating personnel and 

policies of the three Administrations (i.e., Veterans Health 

Administration (VHA), Veterans Benefits Administration, 

National Cemetery Administration) to the extent such programs affect veterans living in rural areas. 

Section 2 of the bill would establish a new Assistant Secretary for Rural Veterans (AS) to formulate, coordinate, 

and implement all policies and procedures of the Department that affect veterans living in rural areas. It would require the new Assistant Secretary to oversee, coordinate, 

promote, and disseminate research into issues affecting 

veterans living in rural areas, in cooperation with VHA 

and the centers that would be established under section 6 

of the bill, as well as ensure maximum effectiveness and 

efficiency in the provision of benefits to these veterans in 

coordination with the Departments of Health and Human 

Services (HHS), Labor, Agriculture and local government 

agencies. 

In addition, section 2 would require the Assistant Secretary to identify a Rural Veterans Coordinator in each 

VHA Integrated Service Network (VISN), who would report directly to the Assistant Secretary and coordinate all 

the functions authorized under section 2 within his respective VISN. It would also require the Assistant Secretary, 

under the direction of Secretary, to supervise the VA employees who are responsible for implementing these policies and procedures. 

Section 3 of the bill would require the Assistant Secretary to carry out demonstration projects to examine alternatives for expanding care in rural areas. In so doing, 

the Assistant Secretary would have to work with the Department of Health and Human Services to coordinate care 

that is delivered through the Indian Health Service, Critical Access hospitals, or Community Health Centers. One 

such program would have to involve expanded use of feebasis care for veterans living in rural or remote areas. Not 

later than one year after the date of enactment of this Act, 

the Assistant Secretary would be further required to reevaluate VA policy on the use of fee basis care nationwide 

and to revise established policies to extend health care 

services to rural and remote rural areas. 

Section 4 of the bill would require the Secretary to conduct a three-year pilot program in 3 VISNs to evaluate 

various means to improve access to care in highly rural or 

geographically remote areas for all enrolled veterans and 

those with service-connected disabilities who live in such 

areas. In carrying out the pilot, the Secretary would be required to provide these veterans with acute or chronic 

symptom management, non-therapeutic medical services, 

and any other medical services jointly determined to be appropriate by the individual veteran’s VA primary care physician and the respective VISN Director. The Secretary 

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ical care funds to carry out this section before allocating 

any other medical funds. 

Section 5 would amend VA’s authority to provide beneficiary travel benefits to require that covered lodging and 

subsistence be determined at the same rates that apply to 

Federal employees. It would also require that VA’s mileage 

allowance be determined in accordance with the rates that 

apply to Federal employees. 

Finally, section 6 of the bill would require the new Assistant Secretary to establish up to five centers of excellence for rural health research, education, and clinical activities. These center(s) would be required to: conduct research on rural health services; allow for use of specific 

models of furnishing services to this population; provide 

education and training for health care professionals; and, 

develop and implement innovative clinical activities and 

systems of care. 

We share the concern that rural veterans have adequate 

access to VA health care and other VA services; however, 

we do not agree that the bill would effectively achieve this 

and, so, oppose S. 2433. First, the Under Secretaries of the 

three VA Administrations are responsible for formulating 

and implementing program policy in their respective areas. 

The proposed Assistant Secretary could have no direct authority over them or their organizations. The proposed role 

and responsibilities of the Assistant Secretary, as provided 

for in this legislation, would cause significant confusion 

and disruption across organizational lines—both among, 

and within, the Administrations. 

Assuming there were some way to operationalize the responsibilities of the Assistant Secretary, the ability of the 

Under Secretaries to manage their employees and respective programs efficiently and effectively would be significantly reduced. The bill would dilute control from the Administrations with respect to specified activities, personnel, and resources. This would increase the potential 

for fragmented services, waste, and inconsistent, if not unequal, treatment of veterans based solely on their geographic location. For instance, 23% of enrollees live in 

rural areas based on the Census’ definition of a rural area. 

However, only four percent of enrollees live in a rural area 

and travel more than 60 minutes to a VA facility. Under 

the bill, a disproportionate share of health care resources 

would be directed to this population. The planning and delivery of services to rural veteran-enrollees would be inconsistent and incoherent with respect to the total population 

of enrolled veterans. The possibility of fragmentation in 

the delivery of benefits cannot be overstated. 

Second, S. 2433 would adversely dilute the ability of the 

Under Secretary for Health to manage not only the delivery of VA health care to rural veterans but also the delivery of health care to all veterans because of the significant 

costs associated with enactment of this bill. The proposed 

demonstration projects would cost $225 million based on 

the President’s Budget for Fiscal Year 07. The additional 


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58 

beneficiary travel benefits would cost approximately $550 

million (based on current employee-related rates), and that 

estimate accounts only for the proposed increase in VA’s 

mileage allowance. Providing per diem (lodging and subsistence) at the proposed rates in addition to the mileage 

allowance would raise the estimate to well over $1 billion. 

Moreover, these increases would assist only the limited 

categories of veterans who are eligible for beneficiary travel benefits. We believe medical care funds are better directed to the delivery of direct health care for all eligible 

veterans. 

We note that the mandate to expand the use of fee-basis 

care in the proposed demonstration projects may not be 

possible, because VA’s authority to provide fee-basis care 

(meaning contract care other than care furnished under a 

sharing or scarce-medical-specialist agreement) is limited 

by statute. Further, the mandate ignores the economic impact of expanding the use of fee basis care. The cost of care 

in fee settings is typically significantly greater than the 

cost of the same care provided in VA settings. As a result, 

while fee-basis expansion may make care accessible for 

some rural veterans, it would disproportionately reduce 

the resources available for care of all other veterans. Moreover, we do not understand the mandate to provide nontherapeutic medical services as part of the pilot program 

and would question the wisdom of providing such service 

from the three medical care appropriations. Finally, the 

demonstration projects and pilot project could be achieved, 

to a large extent, within the current VHA structure and 

existing authority. It does not require an organizational restructuring, which, again, would create significant risk of 

fragmentation and lack of continuity of care and benefits. 

* * * * * 

S. 2634 Eliminating Statutory Term Limits of Under Secretary for Health and Under Secretary for Benefits 

Mr. Chairman, S. 2634 would eliminate the current statutory four-year term limit that applies to both the Under 

Secretary for Health and the Under Secretary for Benefits 

position, as well as the currently mandated search-commission processes for identifying candidates to recommend 

to the President for these positions. VA supports S. 2634 

as it would provide the Secretary with needed flexibility as 

well as decrease the time required to fill these vacancies. 

STATEMENT OF RONALD AUMENT, DEPUTY UNDER SECRETARY FOR BENEFITS, DEPARTMENT OF VETERANS AFFAIRS—JUNE 8, 2006 

Mr. Chairman and Members of the Committee, thank 

you for the opportunity to testify today on a number of legislative items of great interest to veterans. I am joined at 

the witness table by John H. Thompson, Deputy General 

Counsel. 


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59 

S. 2121 

S. 2121, the ‘‘Veterans Housing Fairness Act of 2005,’’ would authorize VA to guarantee loans for stock in certain 

developments, structures, or projects of a cooperative housing corporation (co-ops). 

VA cannot support this bill because we do not believe 

that VA participation in co-ops would be in the best interest of the veteran or of the Government as guarantor of 

the loan. Under current law, a veteran may purchase a 

conventional home, a condominium unit, or a manufactured home and a manufactured home lot. In all cases except a manufactured home, the veteran is purchasing real 

property. Although the manufactured home is normally 

considered personal property, the veteran also obtains title 

to the actual home he or she will be occupying. In contrast, 

the buyer of a co-op does not acquire an interest in real estate or obtain title to his or her dwelling unit. Instead, the 

purchaser acquires personal property in the form of a 

share of the cooperative’s stock, coupled with the right to 

occupy a particular apartment in the building. A buyer 

normally obtains a share loan that finances the purchase 

of an ownership interest in the co-op. This loan is evidenced by a promissory note and is secured by a pledge of 

the stock, shares, membership certificate, or other contractual agreement that evidences ownership in the corporation and by an assignment of the proprietary lease or occupancy agreement. VA would be guaranteeing this corporate share loan. Unlike other VA loans, there would be 

no lien on real property or tangible personal property. 

Cooperative housing projects are usually subject to blanket mortgages. This is a matter of great concern because 

of the significant risk to which the buyer, the loan holder, 

and VA are exposed. The buyer of a co-op is responsible for 

the monthly payment on the share loan as well as the assessments levied by the corporation, which can be significant. The survival of the project may depend upon each 

member of the co-op meeting his or her obligations. Failure 

to do that could lead to foreclosure of the blanket mortgage 

on the entire building. Such foreclosure would wipe out 

any interest individual co-op owners, even owners who are 

timely in the payment of their share loans, may have in 

the project since they have no interest in real property. It 

would also leave the holder of the share loan without any 

security. This is what principally sets co-ops apart from 

condominiums. 

Many co-ops also retain a right of first refusal or a right 

by the co-op board to approve or reject a prospective buyer. 

Rights of first refusal are not permitted by VA regulation, 

38 C.F.R. § 36.4350, and VA does not participate in 

projects that have them. We believe that the issue of right 

of first refusal alone would disqualify most projects from 

VA eligibility. 

We understand that some co-op projects impose other restrictions on sales, such as imposing a fee when the owner 

sells his or her unit to someone other than the corporation, 


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or granting the exclusive right to sell units to a particular 

real estate broker, often at a higher commission. These 

and similar practices would be viewed as detrimental to 

the interests of veterans and, therefore, not permitted 

under current VA regulations for conventional or condominium developments. These practices could also adversely affect the marketability of a unit. If a veteran-borrower is experiencing financial difficulties and cannot freely dispose of his or her unit at an advantageous price, foreclosure with a resultant loss to VA is more likely. 

We also understand that conventional lenders, as well as 

the secondary mortgage market agencies, generally have 

additional underwriting and project requirements for coops because of the additional risks they present. In addition, valuation of these properties would be very complicated because of the blanket mortgage. 

Costs associated with this legislation would likely be insignificant compared to the overall VA guaranteed loan 

portfolio. 

S. 2416 

S. 2416, the ‘‘Veterans Employment and Training Act of 

2006,’’ would expand the programs of education for which 

accelerated payment of educational assistance may be 

made under the chapter 30 Montgomery GI Bill (MGIB) 

program. Specifically, this measure would permit accelerated payment of the basic educational assistance allowance 

to veterans pursuing an approved program of education (in 

addition to the programs now authorized such payment) 

lasting less than two years and leading to employment in 

a sector of the economy that is projected to experience substantial job growth, positively affects the growth of another 

sector of the economy, or consists of existing or emerging 

businesses that are being changed by technology and innovation and require new skills for workers, as determined 

by the Department of Labor (DOL). 

Under current law, only an MGIB participant pursuing 

high-cost courses leading to employment in a high technology occupation in a high technology industry has the 

option of receiving an accelerated benefit payment. This 

optional lump-sum accelerated benefit payment may cover 

up to 60 percent of the cost of such a course, provided the 

pro-rated course costs exceed 200 percent of the applicable 

monthly MGIB rate. The lump-sum payment is deducted 

from the veteran’s MGIB entitlement balance in the same 

manner as if paid on a monthly basis and may not exceed 

that balance. 

In addition, S. 2416 specifically states that, for purposes 

of accelerated payment of educational assistance, the term 

‘‘program of education’’ would include such a program pursued at a tribally controlled college or university (as defined in the Tribally Controlled College or University Assistance Act of 1978). 

VA supports S. 2416, subject to Congress’ enactment of 

legislation offsetting the cost of the increased benefits. 


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61 

However, as discussed below, we believe there may be a 

more efficient way of achieving its objective. 

We note that implementation would be challenging for 

VA. The DOL employment projections change every two 

years. In addition, depending on the definition of ‘‘sector,’’

it is possible that almost all programs would lead to employment in one sector of the economy that would affect at 

least one other sector positively. It would be cleaner and 

more direct if the bill simply stated that all high-cost 

short-term courses were eligible for accelerated payment. 

Secondly, S. 2416 would exclude from the proposed expansion of accelerated payment eligibility those individuals 

who are enrolled in an associate’s or higher degree program. Thus, such an individual only could receive an accelerated payment if his or her program of education leads to 

employment in a high technology occupation in a high 

technology industry (as determined by VA). We can see no 

sound public policy basis for making this distinction. 

Concerning the bill’s express provision for accelerated 

payments under chapter 30 to eligible veterans pursuing a 

program of education at a tribally controlled college or university, VA has no objection. We note, however, that VA 

currently considers such programs to be ‘‘programs of education’’ for MGIB purposes, and we are not aware of any 

situations pertaining to servicemembers or veterans attending tribally controlled colleges or universities that adversely affect their eligibility for accelerated benefit payments. 

VA estimates S. 2416, if enacted, would cost $11.5 million during FY 2007 and approximately $121.6 million over 

the period FYs 2007–2016. The estimates for the years following FY 2007 would need to be reassessed annually due 

to DOL initiative changes. 

* * * * * 

S. 2659 

S. 2659, the ‘‘Native American Veterans Cemetery Act of 

2006,’’ would authorize the Secretary of Veterans Affairs to 

make grants to Native American tribal organizations to assist them in establishing, expanding, or improving veterans’ cemeteries on trust lands in the same manner and 

under the same conditions as grants to states are made 

under 38 U.S.C. § 2408. We strongly support enactment of 

this bill. 

The cemetery grants program has proven to be an effective way of making the option of veterans cemetery burial 

available in locations not conveniently served by our national cemeteries. S. 2659 would create another means of 

accommodating the burial needs of Native American veterans who wish to be buried in tribal lands. 

S. 2694 

S. 2694, the ‘‘Veterans’ Choice of Representation Act of 

2006,’’ would eliminate the current prohibition on the 


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62 

charging of fees for services of an agent or attorney provided before the Board of Veterans’ Appeals (Board) makes 

its first final decision in the case. It would also authorize 

VA to restrict the amount of fees agents or attorneys may 

charge and subject fee agreements between agents or attorneys and claimants to review by the Secretary, such review to be appealable to the Board. In addition, it would 

eliminate fee matters as grounds for criminal penalties 

under 38 U.S.C. § 5905. 

S. 2694 would also authorize VA to regulate the qualifications and standards of conduct applicable to agents and 

attorneys, add three grounds to the list of grounds for suspension or exclusion of agents or attorneys from further 

practice before VA, subject VSO representatives and individuals recognized for a particular claim to suspension on 

the same grounds as apply to agents and attorneys, and 

authorize VA to periodically collect registration fees from 

agents and attorneys to offset the cost of these regulatory 

activities. 

We understand, and in fact agree with, the argument 

that veterans are as capable as anyone of deciding whether 

to employ attorneys on their behalves. However, that is 

not the issue. The Government has an obligation to ensure 

that veterans derive maximum value from taxpayer-supported VA programs. This Committee expressed its concern in 1988 when it reported out a bill (S. 11, 100th 

Cong.) that would have retained the prior $10 limitation 

on fees for claims resolved before or in the first Board decision, that any changes relating to attorneys’ fees ‘‘be made 

carefully so as not to induce unnecessary retention of attorneys by VA claimants.’’ Under S. 2694, attorney fees 

would consume significant amounts of payments under 

programs meant to benefit veterans, and Congress should 

not enact this bill unless it becomes convinced veterans 

would gain more in terms of increased benefits than they 

would lose to their attorneys. Available evidence shows 

that is unlikely, hence we cannot support the bill’s enactment. 

Throughout the years, Congress has recognized, correctly, that integration of VSO representatives into the 

process of developing and deciding claims is one of the 

most valuable features of the VA adjudication system. 

These representatives are available to guide through the 

claims process all claimants who seek their assistance, 

without charge. VSO representatives are well-versed in 

veterans benefits law as a result of the training they receive and therefore are well-equipped to successfully assist 

claimants throughout the administrative processing of 

their claims. Further, VSOs must certify to VA that their 

representatives are fully qualified to represent claimants. 

These facts alone cause us to doubt that participation by 

attorneys would gain claimants more in increased benefits 

than it would cost them in fees. 

Moreover, what empirical data exist do not indicate attorneys would provide service superior to that rendered by 


bajohnson on PROD1PC77 with REPORTS
63 

VSO representatives. For example, in FY 2005, 7.5 percent 

of appellants before the Board of Veterans’ Appeals were 

represented by attorneys, and approximately 80 percent 

were represented by VSOs. Approximately the same percentage of claims was granted in matters appealed to the 

Board whether a claimant was represented by a VSO representative or was represented by an attorney. In FY 2005, 

the Board granted one or more of the benefits sought in 

21.3 percent of the appeals in which a claimant was represented by an attorney. The Board granted one or more 

of the benefits sought in 22.3 percent of the cases in which 

a claimant was represented by a VSO. 

The expense of employing an attorney to obtain veterans 

benefits would appear to be largely unwarranted. For example, many claims are granted immediately by VA based 

on a presumption of service connection or incurrence of an 

injury or disease during service. VA currently has presumptions of service connection for several different kinds 

of service and many diseases. For example, a Vietnam veteran is entitled to a presumption of service connection if 

he or she develops diabetes mellitus (Type 2). Giving VA 

an opportunity to decide such a claim without attorney involvement may well save a veteran money. In addition, 

claimants do not appeal to the Board in about 90 percent 

of claims decided by VA regional offices, suggesting a high 

level of satisfaction with the regional offices’ decisions in 

their cases. Paying an attorney to assist in presenting 

these claims would seem to be a waste of claimants’ financial resources. 

Also, as this Committee recognized in 1988 when it reported out S. 11, there is ‘‘no compelling justification’’ for 

hiring an attorney prior to that point. The Supreme Court 

recognized in Walters v. National Ass’n of Radiation Survivors that, ‘‘[a]s might be expected in a system which 

processes such a large number of claims each year, the 

process prescribed by Congress for obtaining disability 

benefits does not contemplate the adversary mode of dispute resolution.’’ Rather, the Supreme Court said, ‘‘The 

process is designed to function throughout with a high degree of informality and solicitude for the claimant.’’

All a claimant need do is file a claim, and VA will notify 

the claimant of the information and evidence necessary to 

substantiate the claim, assist the claimant in obtaining 

relevant Government and private records, provide a medical examination or obtain a medical opinion when necessary to decide a compensation claim, and make an initial 

decision on the claim. If a claim is denied, all a claimant 

need do to initiate an appeal to the Board is to write VA 

expressing dissatisfaction or disagreement with the decision and a desire to contest the result. The VA agency that 

made the original decision on the claim will develop or review the claim in a final attempt to resolve the disagreement and issue a statement of the case if the disagreement 

is not resolved. VA assumes primary responsibility for 

leading a claimant through the administrative claims procVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00063 Fmt 6659 Sfmt 6969 E:\HR\OC\SR297.XXX SR297

bajohnson on PROD1PC77 with REPORTS
64 

ess, making the expenditure of a claimant’s limited financial resources on an attorney unnecessary. Furthermore, 

we are concerned that enactment of this bill would impede 

the Government’s paramount interest in promoting and 

maintaining a non-adversarial adjudicative process, as exemplified by the Veterans Claims Assistance Act of 2000 

requiring VA to notify a claimant of the information and 

evidence necessary to substantiate a claim and to assist a 

claimant in obtaining such evidence. This statute was designed to facilitate beneficial interaction between claimants and VA during the initial adjudication process. S. 

2694, by permitting claimants to employ paid attorneys before issuance of the first final Board decision, would be incongruent with the beneficent VA system that Congress 

has nurtured over the decades. 

Also, attorney-represented claimants would lose certain 

benefits of the current non-adversarial system. For example, the Court of Appeals for the Federal Circuit recently 

held in Andrews v. Nicholson that VA must sympathetically read all pro se pleadings, including a pro se motion alleging clear and unmistakable error (CUE) in a VA 

decision. However, the court stated in Andrews and in 

Johnston v. Nicholson that VA is not obligated to sympathetically read pleadings filed by counsel, and the failure 

to raise an issue in a CUE motion filed by counsel before 

the Board is fatal to subsequently raising the issue before 

the Court of Appeals for Veterans Claims. S. 2694 would 

attempt to maintain the non-adversarial nature of the 

process by authorizing VA to suspend claim representatives who fail to conduct themselves ‘‘with due regard for 

the non-adversarial nature of’’ VA proceedings. However, a 

requirement for non-adversarial conduct by an attorney 

appears inconsistent with an attorney’s professional responsibility to ‘‘represent a client zealously within the 

bounds of the law.’’ MODEL CODE OF PROF’L RESPONSIBILITY CANON 7 (1983). ‘‘While serving as advocate, a 

lawyer should resolve in favor of his client doubts as to the 

bounds of the law’’ and may urge any permissible construction of the law favorable to his client. MODEL CODE OF 

PROF’L RESPONSIBILITY EC 7–3 and 7–4 (1983). An attorney who ‘‘appear[s] before an administrative agency, regardless of the nature of the proceeding it is conducting, 

has the continuing duty to advance the cause of his client 

within the bounds of the law.’’ MODEL CODE OF PROF’L 

RESPONSIBILITY EC 7–15. Introducing an attorney 

charged with such professional obligations into the non-adversarial claims process from its initial stages would, in 

our view, inevitably make the process more adversarial, 

which we believe would harm the interests of VA claimants. Further, if S. 2694 were enacted, VA would likely 

have to hire attorneys to work in its Regional Offices to respond to the legal pleadings filed by attorneys in support 

of their clients’ claims. However unintentional it would be, 

we predict the process would inevitably become more formal and brief driven, to the point claimants may feel they 


bajohnson on PROD1PC77 with REPORTS
65 

must hire attorneys to establish entitlement to their benefits. The result would almost certainly be to increase the 

time all veterans must wait for decisions in their claims. 

Finally, we cannot support S. 2694 because it would require creation of a substantial new bureaucracy to perform 

the additional accreditation and oversight responsibilities. 

Currently, an attorney in good standing with the bar of 

any state may represent a claimant before VA if the attorney states in a signed writing on his or her letterhead that 

he or she is authorized to represent the claimant. If S. 

2694 were enacted, VA would have to create procedures 

and standards for accrediting attorneys and for reviewing 

fee agreements for services performed at the ROs to determine whether a fee charged by an agent or attorney is ‘‘excessive or unreasonable.’’ The additional time and substantial resources that would be required to carry out the accreditation process and review fee agreements for work 

performed before the ROs would, in our view, be better 

spent adjudicating the approximately 800,000 benefit 

claims that VA receives annually. 

Moreover, attorneys are licensed by the various states, 

which are responsible for regulating their conduct and disciplining them if they overreach with respect to fees 

charged. If attorneys are permitted to practice before the 

Department and charge fees for their services, it would be 

far better to have them regulated by the states responsible 

for their licenses than to create a new Federal office to 

monitor attorney conduct. 

S. 3363 

S. 3363 would provide for accelerated payment of survivors’ and dependents’ educational assistance for certain 

programs of education under chapter 35 of title 38, United 

States Code. VA will provide its comments and costs on S. 

3363 at a later time. 

That concludes my statement, Mr. Chairman. I would be 

happy now to entertain any questions you or the other 

members of the Committee may have. 

LETTER FROM WILLIAM J. HAYNES II, GENERAL COUNSEL, 

DEPARTMENT OF DEFENSE

FEBRUARY 9, 2006. 

Hon. LARRY E. CRAIG, Chairman, Committee on Veterans Affairs, 

U.S. Senate, Washington, DC. 

DEAR CHAIRMAN CRAIG: I want to convey the Department of Defense’s position on S. 1759, a bill to ‘‘require the 

Secretary of the Army to remove the remains of Russell 

Wayne Wagner from Arlington National Cemetery.’’ The 

Department of Defense has no objection to the enactment 

of this bill. 

The Department notes that Mr. Wagner’s remains were 

buried in accordance with existing law and that S. 1759 


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66 

would not direct the removal of the remains of other capital offenders interred at Arlington National Cemetery. 

The Department is concerned that, as drafted S. 1759 

would require the Department of the Army to bear the 

costs of a subsequent interment or inurnment in a public 

or private cemetery. The Department of Defense does not 

provide funeral costs for veterans at public or private 

cemeteries. Doing so in this case could set an undesirable 

precedent. Additionally, we believe the first option should 

be to offer the remains to the decedent’s family. 

The Office of Management and Budget advises that, 

from the standpoint of the Administration’s program, there 

is no objection to the presentation of this letter for the consideration of the committee. 

Sincerely, 

WILLIAM J. HAYNES II. 

CHANGES IN EXISTING LAW MADE BY THE COMMITTEE BILL, AS

REPORTED

In compliance with paragraph 12 of Rule XXVI of the Standing 

Rules of the Senate, changes in existing law made by the Committee bill, as reported, are shown as follows (existing law proposed 

to be omitted is enclosed in black brackets, new matter is printed 

in italic, existing law in which no change is proposed is shown in 

roman): 

TITLE 26, UNITED STATES CODE 

* * * * * * * 

§ 6103. Confidentiality and disclosure of returns and return 

information 

* * * * * * * 

(l) * * * 

(7) * * * 

Only return information from returns with respect to net earnings from self-employment and wages may be disclosed under this 

paragraph for use with respect to any program described in clause 

(viii)(IV). Clause (viii) shall not apply after øSeptember 30, 2008¿ 

September 30, 2011. 

TITLE 38, UNITED STATES CODE 

* * * * * * * 

PART I. GENERAL PROVISIONS 

* * * * * * * 

CHAPTER 3. DEPARTMENT OF VETERANS AFFAIRS 

* * * * * * * 


bajohnson on PROD1PC77 with REPORTS
67 

§ 305. Under Secretary for Health 

* * * * * * * 

ø(c) The Under Secretary for Health shall be appointed for a period of four years, with reappointment permissible for successive 

like periods. If the President removes the Under Secretary for 

Health before the completion of the term for which the Under Secretary for Health was appointed, the President shall communicate 

the reasons for the removal to Congress.¿ 

ø(d)¿ (c)(1) Whenever a vacancy in the position of Under Secretary for Health occurs or is anticipated, the Secretary shall establish a commission to recommend individuals to the President for 

appointment to the position. 

(2) A commission established under this subsection shall be 

composed of the following members appointed by the Secretary: 

(A) Three persons representing clinical care and medical research and education activities affected by the Veterans Health 

Administration. 

(B) Two persons representing veterans served by the Veterans Health Administration. 

(C) Two persons who have experience in the management of 

veterans health services and research programs, or programs 

of similar content and scope. 

(D) The Deputy Secretary of Veterans Affairs. 

(E) The Chairman of the Special Medical Advisory Group established under section 7312 of this title. 

(F) One person who has held the position of Under Secretary 

for Health (including service as Chief Medical Director of the 

Department), if the Secretary determines that it is desirable 

for such person to be a member of the commission. 

(3) A commission established under this subsection shall recommend at least three individuals for appointment to the position 

of Under Secretary for Health. The commission shall submit all 

recommendations to the Secretary. The Secretary shall forward the 

recommendations to the President with any comments the Secretary considers appropriate. Thereafter, the President may request the commission to recommend additional individuals for appointment. 

(4) The Assistant Secretary or Deputy Assistant Secretary of 

Veterans Affairs who performs personnel management and labor 

relations functions shall serve as the executive secretary of a commission established under this subsection. 

§ 306. Under Secretary for Benefits 

* * * * * * * 

ø(c) The Under Secretary for Benefits shall be appointed for a period of four years, with reappointment permissible for successive 

like periods. If the President removes the Under Secretary for Benefits before the completion of the term for which the Under Secretary for Benefits was appointed, the President shall communicate 

the reasons for the removal to Congress.¿ 

ø(d)¿ (c)(1) Whenever a vacancy in the position of Under Secretary for Benefits occurs or is anticipated, the Secretary shall establish a commission to recommend individuals to the President for 

appointment to the position. 


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68 

(2) A commission established under this subsection shall be 

composed of the following members appointed by the Secretary: 

(A) Three persons representing education and training, real estate, mortgage finance, and related industries, and survivor benefits activities affected by the Veterans Benefits Administration. 

(B) Two persons representing veterans served by the Veterans 

Benefits Administration. 

(C) Two persons who have experience in the management of 

veterans benefits programs or programs of similar content and 

scope. 

(D) The Deputy Secretary of Veterans Affairs. 

(E) The chairman of the Veterans’ Advisory Committee on 

Education formed under section 3692 of this title. 

(F) One person who has held the position of Under Secretary 

for Benefits (including service as Chief Benefits Director of the Department), if the Secretary determines that it is desirable for such 

person to be a member of the commission. 

(3) A commission established under this subsection shall recommend at least three individuals for appointment to the position 

of Under Secretary for Benefits. The commission shall submit all 

recommendations to the Secretary. The Secretary shall forward the 

recommendations to the President with any comments the Secretary considers appropriate. Thereafter, the President may request the commission to recommend additional individuals for appointment. 

(4) The Assistant Secretary or Deputy Assistant Secretary of 

Veterans Affairs who performs personnel management and labor 

relations functions shall serve as the executive secretary of a commission established under this subsection. 

* * * * * * * 

PART II. GENERAL BENEFITS 

* * * * * * * 

CHAPTER 15. PENSION FOR NON-SERVICE-CONNECTED 

DISABILITY OR DEATH OR FOR SERVICE 

Subchapter I. General 

* * * * * * * 

§ 1505. Payment of pension during confinement in penal institutions 

(a) No pension under public or private laws administered by the 

Secretary shall be paid to or for an individual who has been imprisoned in a Federal, State, øor local penal institution¿ local, or other 

penal institution or correctional facility as a result of conviction of 

a felony or misdemeanor for any part of the period beginning sixtyone days after such individual’s imprisonment begins and ending 

when such individual’s imprisonment ends. 

* * * * * * * 


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69 

CHAPTER 17. HOSPITAL, NURSING HOME, DOMICILIARY, 

AND MEDICAL CARE 

* * * * * * * 

Subchapter V. Payments to State Homes 

1741. Criteria for payment. 

1742. Inspections of such homes; restrictions on beneficiaries. 

1743. Applications. 

1744. Hiring and retention of nurses: payments to assist States. 

1745. Nursing home care and medications for veterans with service-connected disabilities. 

* * * * * * * 

Subchapter II. Hospital, Nursing Home, or Domiciliary Care 

and Medical Treatment 

§ 1710. Eligibility for hospital, nursing home, and domiciliary care 

(a) * * * 

* * * * * * * 

(4) The requirement in paragraphs (1) and (2) that the Secretary furnish hospital care and medical services, the requirement in section 1710A(a) of this title that the Secretary provide nursing home care, øand¿ the requirement in section 

1710B of this title that the Secretary provide a program of extended care services, and the requirement in section 1745 of 

this title to provide nursing home care and prescription medicines to veterans with service-connected disabilities in State 

homes shall be effective in any fiscal year only to the extent 

and in the amount provided in advance in appropriations Acts 

for such purposes. 

* * * * * * * 

§ 1741. Criteria for payment 

(a)(1) øThe¿ Except as provided in section 1745 of this title, the 

Secretary shall pay each State at the per diem rate of— (A) $8.70 for domiciliary care; and 

(B) $20.35 for nursing home care and hospital care, for each 

veteran receiving such care in a State home, if such veteran is 

eligible for such care in a Department facility. 

* * * * * * * 

(f) Any State home that requests payment or reimbursement for 

services provided to a veteran under this section shall provide to the 

Secretary such information as the Secretary considers necessary to 

identify each individual veteran eligible for payment under such 

section. 

* * * * * * * 

§ 1745. Nursing home care and medications for veterans with 

service-connected disabilities 

(a)(1) The Secretary shall pay each State home for nursing home 

care at the rate determined under paragraph (2), where such care 

is provided to any veteran as follows: 


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70 

(A) Any veteran in need of such care for a service-connected 

disability. 

(B) Any veteran who—

(i) has a service-connected disability rated at 70 percent 

or more; and 

(ii) is in need of such care. 

(2) The rate determined under this paragraph with respect to 

a State home is the lesser of—

(A) the applicable or prevailing rate payable in the geographic area in which the State home is located, as determined 

by the Secretary, for nursing home care furnished in a non-Department nursing home (as that term is defined in section 

1720(e)(2)); or 

(B) a rate not to exceed the daily cost of care, as determined 

by the Secretary, following a report to the Secretary by the director of the State home. 

(3) Payment by the Secretary under paragraph (1) to a State home 

for nursing home care provided to a veteran described in that paragraph constitutes payment in full to the State home for such care 

furnished to that veteran. 

(b) The Secretary shall furnish such drugs and medicines as may 

be ordered on prescription of a duly licensed physician as specific 

therapy in the treatment of illness or injury to any veteran as follows: 

(1) Any veteran who—

(A) is not being provided nursing home care for which 

payment is payable under subsection (a); and 

(B) is in need of such drugs and medicines for a serviceconnected disability. 

(2) Any veteran who—

(A) has a service-connected disability rated at 50 percent 

or more; 

(B) is not being provided nursing home care for which 

payment is payable under subsection (a); and 

(C) is in need of such drugs and medicines. 

(c) Any State home that requests payment or reimbursement for 

services provided to a veteran under this section shall provide to the 

Secretary such information as the Secretary considers necessary to 

identify each individual veteran eligible for payment under such 

section. 

* * * * * * * 

CHAPTER 19. INSURANCE 

Subchapter I. National Service Life Insurance 

* * * * * * * 

§ 1922A. Supplemental service disabled veterans’ insurance 

for totally disabled veterans 

(a) Any person insured under section 1922(a) of this title who 

qualifies for a waiver of premiums under section 1912 of this title 

is eligible, as provided in this section, for supplemental insurance 

in an amount not to exceed ø$20,000¿ $30,000, during the period 


bajohnson on PROD1PC77 with REPORTS
71 

beginning on October 1, 2007, and ending on September 31, 2011, 

or $20,000 at any other time. 

* * * * * * * 

CHAPTER 20. BENEFITS FOR HOMELESS VETERANS 

* * * * * * * 

Subchapter V. Housing Assistance 

2041. Housing assistance for homeless veterans. 

2042. Supported housing for veterans participating in compensated work therapies. 

2043. Domiciliary care programs. 

2044. Financial assistance for supportive services for very low-income veteran families in permanent housing. 

* * * * * * * 

Subchapter II. Comprehensive Service Programs 

§ 2011. Grants 

(a) AUTHORITY TO MAKE GRANTS.—ø(1)¿ Subject to the availability of appropriations provided for such purpose, the Secretary 

shall make grants to assist eligible entities in establishing programs to furnish, and expanding or modifying existing programs 

for furnishing, the following to homeless veterans: 

ø(A)¿ (1) Outreach. 

ø(B)¿ (2) Rehabilitative services. 

ø(C)¿ (3) Vocational counseling and training 

ø(D)¿ (4) Transitional housing assistance. 

ø(2) The authority of the Secretary to make grants under 

this section expires on September 30, 2005.¿ 

* * * * * * * 

§ 2013. Authorization of appropriations 

øThere are authorized to be appropriated to carry out this subchapter amounts as follows: 

ø(1) $60,000,000 for fiscal year 2002. 

ø(2) $75,000,000 for fiscal year 2003. 

ø(3) $75,000,000 for fiscal year 2004. 

ø(4) $99,000,000 for fiscal year 2005.¿ 

There is authorized to be appropriated, to carry out this subchapter, $130,000,000 for fiscal year 2007 and each fiscal year 

thereafter. 

* * * * * * * 

Subchapter IV. Treatment and Rehabilitation for Seriously 

Mentally Ill and Homeless Veterans 

§ 2031. General treatment 

* * * * * * * 

(b) The authority of the Secretary under subsection (a) expires on 

December 31, ø2006¿ 2011. 

* * * * * * * 


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72 

§ 2033. Additional services at certain locations 

* * * * * * * 

(d) The program under this section shall terminate on December 

31, ø2006¿ 2011. 

* * * * * * * 

§ 2041. Housing assistance for homeless veterans 

* * * * * * * 

(c) The Secretary may not enter into agreements under subsection (a) after December 31, ø2008¿ 2011. 

* * * * * * * 

§ 2043. Domiciliary care programs 

* * * * * * * 

§ 2044. Financial assistance for supportive services for very 

low-income veteran families in permanent housing 

(a) DISTRIBUTION OF FINANCIAL ASSISTANCE.— (1) The Secretary shall provide financial assistance to eligible 

entities approved under this section to provide and coordinate 

the provision of supportive services described in subsection (b) 

for very low-income veteran families occupying permanent housing. 

(2) Financial assistance under this section shall consist of per 

diem payments for each such family for which an approved eligible entity is providing or coordinating the provision of supportive services. 

(3)(A) Subject to the availability of appropriations provided 

for such purpose, the Secretary shall provide to each family for 

which an approved eligible entity is providing or coordinating 

the provision of supportive services per diem payments in the 

amount of the daily cost of care estimated by such eligible entity 

(as adjusted by the Secretary under subparagraph (C)). 

(B) In no case may the amount of per diem paid under this 

paragraph exceed the rate of per diem authorized for State 

homes for domiciliary care under subsection (a)(1)(A) of section 

1741 of this title, as adjusted by the Secretary under subsection 

(c) of such section. 

(C) The Secretary may adjust the daily cost of care estimated 

by an eligible entity for purposes of this paragraph to exclude 

other sources of income described in subparagraph (E) that the 

eligible entity certifies to be correct. 

(D) Each eligible entity shall provide to the Secretary such information with respect to other sources of income as the Secretary may require to make the adjustment under subparagraph 

(C). 

(E) The other sources of income referred to in subparagraphs 

(C) and (D) are payments to the eligible entity for furnishing 

services to homeless veterans under programs other than under 

this subchapter, including payments and grants from other departments and agencies of the Federal Government, from departments or agencies of State or local government, and from 

private entities or organizations. 


bajohnson on PROD1PC77 with REPORTS
73 

(4) In providing financial assistance under paragraph (1), the 

Secretary shall give preference to entities providing or coordinating the provision of supportive services for very low-income 

veteran families who are transitioning from homelessness to 

permanent housing. 

(5) The Secretary shall ensure that, to the extent practicable, 

financial assistance under this subsection is equitably distributed across geographic regions, including rural communities 

and tribal lands. 

(6) Each entity receiving financial assistance under this section to provide supportive services to a very low-income veteran 

family shall notify that family that such services are being paid 

for, in whole or in part, by the Department. 

(7) The Secretary may require entities receiving financial assistance under this section to submit a report to the Secretary 

that describes the projects carried out with such financial assistance. 

(b) SUPPORTIVE SERVICES.—The supportive services referred to in 

subsection (a) are the following: 

(1) Services provided by an eligible entity or subcontractors 

that address the needs of very low-income veteran families occupying permanent housing, including— (A) Outreach services; 

(B) health care services, including diagnosis, treatment, 

and counseling for mental health and substance abuse disorders and for post-traumatic stress disorder, if such services are not readily available through the Department medical center serving the geographic area in which the veteran 

family is housed; 

(C) habilitation and rehabilitation services; 

(D) case management services; 

(E) daily living services; 

(F) personal financial planning; 

(G) transportation services; 

(H) vocational counseling; 

(I) employment and training; 

(J) educational services; 

(K) assistance in obtaining veterans benefits and other 

public benefits, including health care provided by the Department; 

(L) assistance in obtaining income support; 

(M) assistance in obtaining health insurance; 

(N) fiduciary and representative payee services; 

(O) legal services to assist the veteran family with reconsiderations or appeals of veterans and public benefit claim 

denials and to resolve outstanding warrants that interfere 

with the family’s ability to obtain or retain housing or supportive services; 

(P) child care; 

(Q) housing counseling; 

(R) other services necessary for maintaining independent 

living; and 

(S) coordination of services under this paragraph. 

(2) Services described in paragraph (1) that are delivered to 

very low-income veteran families who are homeless and who are 


bajohnson on PROD1PC77 with REPORTS
74 

scheduled to become residents of permanent housing within 90 

days pending the location or development of housing suitable 

for permanent housing. 

(3) Services described in paragraph (1) for very low-income 

veteran families who have voluntarily chosen to seek other 

housing after a period of tenancy in permanent housing, that 

are provided, for a period of 90 days after such families exit 

permanent housing or until such families commence receipt of 

other housing services adequate to meet their current needs, but 

only to the extent that services under this paragraph are designed to support such families in their choice to transition into 

housing that is responsive to their individual needs and preferences. 

(c) APPLICATION FOR FINANCIAL ASSISTANCE.—

(1) An eligible entity seeking financial assistance under subsection (a) shall submit an application to the Secretary in such 

form, in such manner, and containing such commitments and 

information as the Secretary determines to be necessary to carry 

out this section. 

(2) Each application submitted by an eligible entity under 

paragraph (1) shall contain—

(A) a description of the supportive services proposed to be 

provided by the eligible entity; 

(B) a description of the types of very low-income veteran 

families proposed to be provided such services; 

(C) an estimate of the number of very low-income veteran 

families proposed to be provided such services; 

(D) evidence of the experience of the eligible entity in providing supportive services to very low-income veteran families; and 

(E) a description of the managerial capacity of the eligible entity to—

(i) coordinate the provision of supportive services 

with the provision of permanent housing, by the eligible entity or by other organizations; 

(ii) continuously assess the needs of very low-income 

veteran families for supportive services; 

(iii) coordinate the provision of supportive services 

with the services of the Department; 

(iv) tailor supportive services to the needs of very 

low-income veteran families; and 

(v) continuously seek new sources of assistance to ensure the long-term provision of supportive services to 

very low-income veteran families. 

(3) The Secretary shall establish criteria for the selection of 

eligible entities to be provided financial assistance under this 

section. 

(d) TECHNICAL ASSISTANCE.—

(1) The Secretary shall provide training and technical assistance to participating eligible entities regarding the planning, 

development, and provision of supportive services to very lowincome veteran families occupying permanent housing. 

(2) The Secretary may provide the training described in paragraph (1) directly or through grants or contracts with appropriate public or nonprofit private entities. 


bajohnson on PROD1PC77 with REPORTS
75 

(e) FUNDING.—

(1) From amounts appropriated to the Department for Medical Care, there shall be available to carry out this section 

amounts as follows: 

(A) $15,000,000 for fiscal year 2007. 

(B) $20,000,000 for fiscal year 2008. 

(C) $25,000,000 for fiscal year 2009. 

(2) Not more than $750,000 may be available under paragraph (1) in any fiscal year to provide technical assistance 

under subsection (d). 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘consumer cooperative’’ has the meaning given 

such term in section 202 of the Housing Act of 1959 (12 U.S.C. 

1701q). 

(2) The term ‘‘eligible entity’’ means—

(A) a private nonprofit organization; or 

(B) a consumer cooperative. 

(3) The term ‘‘homeless’’ has the meaning given that term in 

section 103 of the McKinney-Vento Homeless Assistance Act (42 

U.S.C. 11302). 

(4) The term ‘‘permanent housing’’ means community-based 

housing without a designated length of stay. 

(5) The term ‘‘private nonprofit organization’’ means any of 

the following: 

(A) Any incorporated private institution or foundation—

(i) no part of the net earnings of which inures to the 

benefit of any member, founder, contributor, or individual; 

(ii) which has a governing board that is responsible 

for the operation of the supportive services provided 

under this section; and 

(iii) which is approved by the Secretary as to financial responsibility; 

(B) A for-profit limited partnership, the sole general partner of which is an organization meeting the requirements 

of clauses (i), (ii), and (iii) of subparagraph (A). 

(C) A corporation wholly owned and controlled by an organization meeting the requirements of clauses (i), (ii), and 

(iii) of subparagraph (A). 

(D) A tribally designated housing entity (as defined in 

section 4 of the Native American Housing Assistance and 

Self-Determination Act of 1996 (25 U.S.C. 4103)). 

(6)(A) Subject to subparagraphs (B) and (C), the term ‘‘very 

low-income veteran family’’ means a veteran family whose income does not exceed 50 percent of the median income for the 

area, as determined by the Secretary in accordance with this 

paragraph. 

(B) The Secretary shall make appropriate adjustments to the 

income requirement under subparagraph (A) based on family 

size. 

(C) The Secretary may establish an income ceiling higher or 

lower than 50 percent of the median income for an area if the 

Secretary determines that such variations are necessary because 

the area has unusually high or low construction costs, fair marVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00075 Fmt 6659 Sfmt 6603 E:\HR\OC\SR297.XXX SR297

bajohnson on PROD1PC77 with REPORTS
76 

ket rents (as determined under section 8 of the United States 

Housing Act of 1937 (42 U.S.C. 1437f)), or family incomes. 

(7) The term ‘‘veteran family’’ includes a veteran who is a single person and a family in which the head of household or the 

spouse of the head of household is a veteran. 

* * * * * * * 

Subchapter VII. Other Provisions 

§ 2061. Grant program for homeless veterans with special 

needs 

* * * * * * * 

(c) FUNDING.— (1) From amounts appropriated to the Department for ‘‘Medical Care’’ for each of fiscal years ø2003, 2004, and 2005, 

$5,000,000¿ 2007 through 2011, $7,000,000 shall be available 

for each such fiscal year for the purposes of the program under 

this section. 

* * * * * * * 

§ 2064. Technical assistance grants for nonprofit communitybased groups 

* * * * * * * 

ø(b) FUNDING.—There is authorized to be appropriated $750,000 

for each of fiscal years 2002 through 2005 to carry out the program 

under this section.¿ 

(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to 

be appropriated $1,000,000 for each of fiscal years 2007 through 

2012 to carry out the program under this section. 

§ 2065. Annual report on assistance to homeless veterans 

* * * * * * * 

(b) * * * 

* * * * * * * 

(4) * * * 

(5) Information on the efforts of the Secretary to coordinate 

the delivery of housing and services to the homeless veterans 

with other Federal departments and agencies, including— (A) the Department of Defense; 

(B) the Department of Health and Human Services; 

(C) the Department of Housing and Urban Development; 

(D) the Department of Justice; 

(E) the Department of Labor; 

(F) the Interagency Council on Homelessness; 

(G) the Social Security Administration; and 

(H) any other Federal department or agency with which 

the Secretary coordinates the delivery of housing and services to homeless veterans. 

ø(5)¿ (6) Any other information on those programs and on 

the provision of such assistance that the Secretary considers 

appropriate. 

* * * * * * * 


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77 

§ 2066. Advisory Committee on Homeless Veterans 

(a) * * * 

* * * * * * * 

(3) The Committee shall include, as ex officio members, the 

following: 

* * * * * * * 

(D) * * * 

(E) The Executive Director of the Interagency Council on 

Homelessness (or a representative of the Executive Director). 

(F) The Under Secretary for Health (or a representative 

of the Under Secretary after consultation with the Director 

of the Office of Homeless Veterans Programs). 

(G) The Under Secretary for Benefits (or a representative 

of the Under Secretary after consultation with the Director 

of the Office of Homeless Veterans Programs). 

* * * * * * * 

(d) TERMINATION.—The Committee shall cease to exist [December 

31, 2006] September 30, 2011. 

* * * * * * * 

CHAPTER 23. BURIAL BENEFITS 

* * * * * * * 

§ 2306. Headstones, markers, and burial receptacles 

* * * * * * * 

(d)(1) The Secretary shall furnish, when requested, an appropriate øGovernment marker¿ Government headstone or marker at 

the expense of the United States for the grave of an individual described in paragraph (2) or (5) of subsection (a) who is buried in 

a private cemetery, notwithstanding that the grave is marked by 

a headstone or marker furnished at private expense. Such a headstone or marker may be furnished only if the individual making the 

request for the Government headstone or marker certifies to the 

Secretary that the headstone or marker will be placed on the grave 

for which the headstone or marker is requested, or, if placement on 

the grave is impossible or impracticable, as close as possible to the 

grave within the grounds of the cemetery in which the grave is located. 

(2) Any headstone or marker furnished under this subsection 

shall be delivered by the Secretary directly to the cemetery where 

the grave is located or to a receiving agent for delivery to the cemetery. 

ø(3) The authority to furnish a marker under this subsection expires on December 31, 2006.¿ 

(3) In furnishing headstones and markers under this subsection, 

the Secretary shall permit the individual making the request for a 

headstone or marker to select among any headstone or marker in 

the complete product line of Government headstones and markers. 

ø(4) Not later than February 1, 2006, the Secretary shall submit 

to the Committees on Veterans’ Affairs of the Senate and House of 


bajohnson on PROD1PC77 with REPORTS
78 

Representatives a report on the use of the authority under this 

subsection. The report shall include the following: 

ø(A) The rate of use of the benefit under this subsection, 

shown by fiscal year. 

ø(B) An assessment as to the extent to which markers furnished under this subsection are being delivered to cemeteries 

and placed on grave sites consistent with the provisions of this 

subsection. 

ø(C) The Secretary’s recommendation for extension or repeal 

of the expiration date specified in paragraph (3).¿ 

* * * * * * * 

(g)(1) A headstone or marker may not be furnished under subsection (a) for the unmarked grave of a person described in section 

2411(b) of this title. 

(2) A memorial headstone or marker may not be furnished under 

subsection (b) for the purpose of commemorating a person described 

in section 2411(b) of this title. 

(3) A headstone or marker may not be furnished under subsection 

(d) for the grave of a person described in section 2411(b) of this 

title. 

* * * * * * * 

CHAPTER 24. NATIONAL CEMETERIES AND MEMORIALS 

* * * * * * * 

§ 2408. Aid to States for establishment, expansion, and improvement of veterans’ cemeteries 

* * * * * * * 

(e) * * * 

(f)(1) The Secretary may make grants under this subsection to any 

tribal organization to assist the tribal organization in establishing, 

expanding, or improving veterans’ cemeteries on trust land owned 

by, or held in trust for, the tribal organization. 

(2) Grants under this subsection shall be made in the same manner, and under the same conditions, as grants to States are made 

under the preceding provisions of this section. 

(3) In this subsection: 

(A) The term ‘‘tribal organization’’ has the meaning given 

that term in section 3765(4) of this title. 

(B) The term ‘‘trust land’’ has the meaning given that term 

in section 3765(1) of this title. 

* * * * * * * 

PART III. READJUSTMENT AND RELATED 

BENEFITS 

CHAPTER 30. ALL-VOLUNTEER FORCE EDUCATIONAL 

ASSISTANCE PROGRAM 

* * * * * * * 

Subchapter II. Basic Educational Assistance 

3011. Basic educational assistance entitlement for service on active duty. 


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79 

3012. Basic educational assistance entitlement for service in the Selected Reserve. 

3013. Duration of basic educational assistance. 

3014. Payment of basic educational assistance. 

ø3014A. Accelerated payment of basic educational assistance for education leading 

to employment in high technology occupation in high technology industry.¿ 

3014A. Accelerated payment of basic educational assistance. 

3015. Amount of basic educational assistance. 

3016. Inservice enrollment in a program of education. 

3017. Death benefit. 

3018. Opportunity for certain active-duty personnel to withdraw election not to enroll. 

3018A. Opportunity for certain active-duty personnel to enroll before being involuntarily separated from service. 

3018B. Opportunity for certain persons to enroll. 

3018C. Opportunity for certain VEAP participants to enroll. 

3019. Tutorial assistance. 

3020. Transfer of entitlement to basic educational assistance: members of the 

Armed Forces with critical military skills. 

* * * * * * * 

[§ 3014A. Accelerated payment of basic educational assistance for education leading to employment in high 

technology occupation in high technology industry] 

§ 3014A. Accelerated payment of basic educational assistance 

(a) An individual described in subsection (b) who is entitled to 

basic educational assistance under this subchapter may elect to receive an accelerated payment of the basic educational assistance allowance otherwise payable to the individual under section 3015 of 

this title. 

(b) An individual described in this subsection is an individual 

who is—

ø(1) enrolled in an approved program of education that leads 

to employment in a high technology occupation in a high technology industry (as determined pursuant to regulations prescribed by the Secretary); and¿ 

(1) enrolled in either—

(A) an approved program of education that leads to employment in a high technology occupation in a high technology industry (as determined pursuant to regulations prescribed by the Secretary); or 

(B) an approved program of education lasting less than 

two years that (as so determined) leads to employment in— (i) the transportation sector of the economy; 

(ii) the construction sector of the economy; 

(iii) the hospitality sector of the economy; or 

(iv) the energy sector of the economy. 

(2) charged tuition and fees for the program of education 

that, when divided by the number of months (and fractions 

thereof) in the enrollment period, exceeds the amount equal to 

200 percent of the monthly rate of basic educational assistance 

allowance otherwise payable to the individual under section 

3015 of this title. 

* * * * * * * 


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80 

Subchapter IV. Time Limitation for Use of Eligibility and 

Entitlement; General and Administrative Provisions 

* * * * * * * 

§ 3036. Reporting requirement 

(a) The Secretary of Defense and the Secretary shall submit to 

the Congress at least once every two years, on January 1, separate 

reports on the operation of the program provided for in this chapter. 

* * * * * * * 

(d) No report shall be required under this section after øJanuary 

1, 2005¿ January 1, 2011. 

CHAPTER 31. TRAINING AND REHABILITATION FOR 

VETERANS WITH SERVICE-CONNECTED DISABILITIES 

§ 3108. Allowances 

* * * * * * * 

(g)(1) Notwithstanding any other provision of this title and subject to the provisions of paragraph (2) of this subsection, no subsistence allowance may be paid under this section in the case of any 

veteran who is pursuing a rehabilitation program under this chapter while incarcerated in a Federal, State, øor local penal institution¿ local, or other penal institution or correctional facility for conviction of a felony. 

* * * * * * * 

CHAPTER 32. POST-VIETNAM ERA VETERANS’

EDUCATIONAL ASSISTANCE 

* * * * * * * 

Subchapter III. Entitlement; Duration 

* * * * * * * 

§ 3231. Entitlement; loan eligibility 

* * * * * * * 

(d)(1) Subject to the provisions of paragraph (2) of this subsection, the amount of the educational assistance benefits paid to 

an eligible veteran who is pursuing a program of education under 

this chapter while incarcerated in a Federal, State, øor local penal 

institution¿ local, or other penal institution or correctional facility 

for conviction of a felony may not exceed the lesser of (A) such 

amount as the Secretary determines, in accordance with regulations which the Secretary shall prescribe, is necessary to cover the 

cost of established charges for tuition and fees required of similarly 

circumstanced nonveterans enrolled in the same program and the 

cost of necessary supplies, books, and equipment, or (B) the applicable monthly benefit payment otherwise prescribed in this section 

3233 of this title. The amount of the educational assistance benefits 

payable to a veteran while so incarcerated shall be reduced to the 

extent that the tuition and fees of the veteran for any course are 


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81 

paid under any Federal program (other than a program administered by the Secretary) or under any State or local program. 

* * * * * * * 

CHAPTER 34. VETERANS’ EDUCATIONAL ASSISTANCE 

* * * * * * * 

Subchapter IV. Payments to Eligible Veterans; VeteranStudent Services 

* * * * * * * 

§ 3482. Computation of educational assistance allowances 

* * * * * * * 

(g)(1) Subject to the provisions of paragraph (2) of this subsection, the amount of the educational assistance allowance paid to 

an eligible veteran who is pursuing a program of education under 

this chapter while incarcerated in a Federal, State, øor local penal 

institution¿ local, or other penal institution or correctional facility 

for conviction of a felony may not exceed such amount as the Secretary determines, in accordance with regulations which the Secretary shall prescribe, is necessary to cover the cost of established 

charges for tuition and fees required of similarly circumstanced 

nonveterans enrolled in the same program and the cost of necessary supplies, books, and equipment, or the applicable monthly 

educational assistance allowance prescribed for a veteran with no 

dependents in subsection (a)(1) or (c)(2) of this section or section 

3687(b)(1) of this title whichever is the lesser. The amount of the 

educational assistance allowance payable to a veteran while so incarcerated shall be reduced to the extent that the tuition and fees 

of the veteran for any course are paid under any Federal program 

(other than a program administered by the Secretary) or under any 

State or local program. 

* * * * * * * 

CHAPTER 35. SURVIVORS’ AND DEPENDENTS’

EDUCATIONAL ASSISTANCE 

* * * * * * * 

Subchapter IV. Payments to Eligible Persons 

3531. Educational assistance allowance. 

3532. Computation of educational assistance allowance. 

3532A. Accelerated payment of educational assistance allowance. 

3533. Special assistance for the educationally disadvantaged. 

3534. Apprenticeship or other on-job training; correspondence courses. 

3535. Approval of courses. 

3536. Specialized vocational training courses. 

3537. Work-study allowance. 

ø3538. Repealed.¿ 

* * * * * * * 

§ 3532. Computation of educational assistance allowance 

* * * * * * * 


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82 

(e) In the case of an eligible person who is pursuing a program 

of education under this chapter while incarcerated in a Federal, 

State, øor local penal institution¿ local, or other penal institution 

or correctional facility for conviction of a felony, the educational assistance allowance shall be paid in the same manner prescribed in 

section 3482(g) of this title for incarcerated veterans, except that 

the references therein to the monthly educational assistance allowance prescribed for a veteran with no dependents shall be deemed 

to refer to the applicable allowance payable to an eligible person 

under corresponding provisions of this chapter or chapter 36 of this 

title, as determined by the Secretary. 

* * * * * * * 

§ 3532A. Accelerated payment of educational assistance allowance 

(a) The educational assistance allowance payable under section 

3531 of this title with respect to an eligible person described in subsection (b) may, upon the election of such eligible person, be paid 

on an accelerated basis in accordance with this section. 

(b) An eligible person described in this subsection is an individual 

who is—

(1) enrolled in either— (A) an approved program of education that leads to employment in a high technology occupation in a high technology industry (as determined pursuant to regulations prescribed by the Secretary); or 

(B) an approved program of education lasting less than 

two years that (as so determined) leads to employment in 

the— (i) transportation sector of the economy; 

(ii) construction sector of the economy; 

(iii) hospitality sector of the economy; or 

(iv) energy sector of the economy; and 

(2) charged tuition and fees for the program of education 

that, when divided by the number of months (and fractions 

thereof) in the enrollment period, exceeds the amount equal to 

200 percent of the monthly rate of educational assistance allowance otherwise payable with respect to the individual under section 3531 of this title. 

(c)(1) The amount of the accelerated payment of educational assistance payable with respect to an eligible person making an election under subsection (a) for a program of education shall be the 

lesser of—

(A) the amount equal to 60 percent of the established charges 

for the program of education; or 

(B) the aggregate amount of educational assistance allowance 

to which the individual remains entitled under this chapter at 

the time of payment. 

(2) In this subsection, the term ‘‘established charges’’, in the case 

of a program of education, means the actual charges (as determined 

pursuant to regulations prescribed by the Secretary) for tuition and 

fees which similarly circumstanced nonveterans enrolled in the program of education would be required to pay. Established charges 

shall be determined on the following basis: 


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83 

(A) In the case of an individual enrolled in a program of education offered on a term, quarter, or semester basis, the tuition 

and fees charged the individual for the term, quarter, or semester. 

(B) In the case of an individual enrolled in a program of education not offered on a term, quarter, or semester basis, the tuition and fees charged the individual for the entire program of 

education. 

(3) The educational institution providing the program of education for which an accelerated payment of educational assistance 

allowance is elected by an eligible person under subsection (a) shall 

certify to the Secretary the amount of the established charges for the 

program of education. 

(d) An accelerated payment of educational assistance allowance 

made with respect to an eligible person under this section for a program of education shall be made not later than the last day of the 

month immediately following the month in which the Secretary receives a certification from the educational institution regarding—

(1) the person’s enrollment in and pursuit of the program of 

education; and 

(2) the amount of the established charges for the program of 

education. 

(e)(1) Except as provided in paragraph (2), for each accelerated 

payment of educational assistance allowance made with respect to 

an eligible person under this section, the person’s entitlement to educational assistance under this chapter shall be charged the number 

of months (and any fraction thereof) determined by dividing the 

amount of accelerated payment by the full-time monthly rate of educational assistance allowance otherwise payable with respect to the 

person under section 3531 of this title as of the beginning date of 

the enrollment period for the program of education for which the accelerated payment is made. 

(2) If the monthly rate of educational assistance allowance otherwise payable with respect to an eligible person under section 3531 

of this title increases during the enrollment period of a program of 

education for which an accelerated payment of educational assistance allowance is made under this section, the charge to the person’s entitlement to educational assistance under this chapter shall 

be determined by prorating the entitlement chargeable, in the manner provided for under paragraph (1), for the periods covered by the 

initial rate and increased rate, respectively, in accordance with regulations prescribed by the Secretary. 

(f) The Secretary may not make an accelerated payment of educational assistance allowance under this section for a program of 

education with respect to an eligible person who has received an advance payment under section 3680(d) of this title for the same enrollment period. 

(g) The Secretary shall prescribe regulations to carry out this section. The regulations shall include requirements, conditions, and 

methods for the request, issuance, delivery, certification of receipt 

and use, and recovery of overpayment of an accelerated payment of 

educational assistance allowance under this section. The regulations 

may include such elements of the regulations prescribed under secVerDate Aug 31 2005 04:08 Aug 02, 2006 Jkt 049010 PO 00000 Frm 00083 Fmt 6659 Sfmt 6603 E:\HR\OC\SR297.XXX SR297

bajohnson on PROD1PC77 with REPORTS
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tion 3014A of this title as the Secretary considers appropriate for 

purposes of this section. 

* * * * * * * 

CHAPTER 36. ADMINISTRATION OF EDUCATIONAL 

BENEFITS 

Subchapter I. State Approving Agencies 

* * * * * * * 

§ 3674. Reimbursement of expenses 

(a) * * * 

* * * * * * * 

(2)(A) The Secretary shall make payments to State and local 

agencies, out of amounts available for the payment of readjustment benefits, and is authorized to make additional payments 

subject to the availability of appropriations, for the reasonable 

and necessary expenses of salary and travel incurred by employees of such agencies in carrying out contracts or agreements entered into under this section, for expenses approved 

by the Secretary that are incurred in carrying out activities described in section 3674A(a)(3) of this title (except for administrative overhead expenses allocated to such activities), and for 

the allowance for administrative expenses described in subsection (b). 

(B) The Secretary shall make such a payment to an agency 

within a reasonable time after the agency has submitted a report pursuant to paragraph (3) of this subsection. 

(C) Subject to paragraph (4) of this subsection, the amount 

of any such payment made to an agency for any period shall 

be equal to the amount of the reasonable and necessary expenses of salary and travel certified by such agency for such 

period in accordance with paragraph (3) of this subsection plus 

the allowance for administrative expenses described in subsection (b) and the amount of expenses approved by the Secretary that are incurred in carrying out activities described in 

section 3674A(a)(3) of this title for such period (except for administrative overhead expenses allocated to such activities). 

(3) Each State and local agency with which a contract or 

agreement is entered into under this section shall submit to 

the Secretary on a monthly or quarterly basis, as determined 

by the agency, a report containing a certification of the reasonable and necessary expenses incurred for salary and travel by 

such agency under such contract or agreement for the period 

covered by the report. The report shall be submitted in the 

form and manner required by the Secretary. 

(4) øThe total amount made available under this section for 

any fiscal year may not exceed $13,000,000 or, for each of fiscal 

years 2001 and 2002, $14,000,000, for fiscal year 2003, 

$14,000,000, for fiscal year 2004, $18,000,000, for fiscal year 

2005, $18,000,000, for fiscal year 2006, $19,000,000, and for 

fiscal year 2007, $19,000,000.¿ 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 


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85 

for purposes of this section from amounts available for the payment of readjustment benefits may not exceed $19,000,000 for 

fiscal years 2006 and 2007, $13,000,000 for fiscal years 2008 

and 2009, $8,000,000 for each of fiscal years 2010 through 

2013, and $13,000,000 for fiscal year 2014 and each subsequent 

fiscal year. 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 the preceding sentence except for the provisions of this paragraph, the Secretary 

shall provide that each agency shall receive the same percentage of the amount applicable to that fiscal year under the preceding sentence as the agency would have received of the total 

amount that would have been made available without the limitation of this paragraph. 

* * * * * * * 

CHAPTER 37. HOUSING AND SMALL BUSINESS LOANS 

* * * * * * * 

Subchapter II. Loans 

§ 3710. Purchase or construction of homes 

(a) * * * 

* * * * * * * 

(11) * * * 

(12) To purchase stock or membership in a cooperative housing corporation for the purpose of entitling the veteran to occupy 

for dwelling purposes a single family residential unit in a development, project, or structure owned or leased by such corporation, in accordance with subsection (h). 

* * * * * * * 

(h)(1) A loan may not be guaranteed under subsection (a)(12) unless—

(A) the development, project, or structure of the cooperative 

housing corporation complies with such criteria as the Secretary prescribes in regulations; and 

(B) the dwelling unit that the purchase of stock or membership in the development, project, or structure of the cooperative 

housing corporation entitles the purchaser to occupy is a single 

family residential unit. 

(2) In this subsection, the term ‘‘cooperative housing corporation’’

has the same meaning given such term in section 216(b)(1) of the 

Internal Revenue Code of 1986. 

(3) When applying the term ‘‘value of the property’’ to a loan guaranteed under subsection (a)(12), such term means the appraised 

value of the stock or membership entitling the purchaser to the permanent occupancy of the dwelling unit in the development, project, 

or structure of the cooperative housing corporation. 

* * * * * * * 


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PART IV. GENERAL ADMINISTRATIVE 

PROVISIONS 

* * * * * * * 

CHAPTER 53. SPECIAL PROVISIONS RELATING TO 

BENEFITS 

* * * * * * * 

§ 5313. Limitation on payment of compensation and dependency and indemnity compensation to persons incarcerated for conviction of a felony 

(a)(1) To the extent provided in subsection (d) of this section, any 

person who is entitled to compensation or to dependency and indemnity compensation and who is incarcerated in a Federal, State, 

øor local penal institution¿ local, or other penal institution or correctional facility for a period in excess of sixty days for conviction 

of a felony shall not be paid such compensation or dependency and 

indemnity compensation, for the period beginning on the sixty-first 

day of such incarceration and ending on the day such incarceration 

ends, in an amount that exceeds— (b) * * * 

* * * * * * * 

(3) No apportionment may be made under this subsection to 

or on behalf of any person who is incarcerated in a Federal, 

State, øor local penal institution¿ local, or other penal institution or correctional facility for conviction of a felony. 

(c) The Secretary shall not assign to any veteran a rating of total 

disability based on the individual unemployability of the veteran 

resulting from a service-connected disability during any period during which the veteran is incarcerated in a Federal, State, øor local 

penal institution¿ local, or other penal institution or correctional facility for conviction of a felony. 

* * * * * * * 

§ 5313A. Limitation on payment of clothing allowance to incarcerated veterans 

In the case of a veteran who is incarcerated in a Federal, State, 

øor local penal institution¿ local, or other penal institution or correctional facility for a period in excess of 60 days and who is furnished clothing without charge by the institution, the amount of 

any annual clothing allowance payable to the veteran under section 

1162 of this title shall be reduced by an amount equal to 1/365 of 

the amount of the allowance otherwise payable under that section 

for each day on which the veteran was so incarcerated during the 

12-month period preceding the date on which payment of the allowance would be due. This section shall be carried out under regulations prescribed by the Secretary. 

* * * * * * * 

§ 5317. Use of income information from other agencies: notice and verification 

* * * * * * * 


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(g) The authority of the Secretary to obtain information from the 

Secretary of the Treasury or the Commissioner of Social Security 

under section 6103(1)(7)(D)(viii) of the Internal Revenue Code of 

1986 expires on øSeptember 30, 2008¿ September 30, 2011. 

* * * * * * * 

CHAPTER 59. AGENTS AND ATTORNEYS 

* * * * * * * 

§ 5902. Recognition of representatives of organizations 

* * * * * * * 

(b)(1) No individual shall be recognized under this section—

ø(1)¿ (A) unless the individual has certified to the Secretary 

that no fee or compensation of any nature will be charged any 

individual for services rendered in connection with any claim; 

and 

ø(2)¿ (B) unless, with respect to each claim, such individual 

has filed with the Secretary a power of attorney, executed in 

such manner and form as the Secretary may prescribe. 

(2) An individual recognized under this section shall be subject to the provisions of 5904(b) of this title on the same basis 

as an individual recognized under section 5904(a) of this title. 

* * * * * * * 

§ 5903. Recognition with respect to particular claims 

(a) IN GENERAL.—The Secretary may recognize any individual for 

the preparation, presentation, and prosecution of any particular 

claim for benefits under any of the laws administered by the Secretary if—

(1) such individual has certified to the Secretary that no fee 

or compensation of any nature will be charged any individual 

for services rendered in connection with such claim; and 

(2) such individual has filed with the Secretary a power of 

attorney, executed in such manner and in such form as the 

Secretary may prescribe. 

(b) SUSPENSION.—An individual recognized under this section 

shall be subject to the provisions of section 5904(b) of this title on 

the same basis as an individual recognized under section 5904(a) of 

this title. 

§ 5904. Recognition of agents and attorneys generally 

(a)(1) The Secretary may recognize any individual as an agent or 

attorney for the preparation, presentation, and prosecution of 

claims under laws administered by the Secretary. øThe Secretary 

may require that individuals, before being recognized under this 

section, show that they are of good moral character and in good repute, are qualified to render claimants valuable service, and otherwise are competent to assist claimants in presenting claims.¿ 

(2) The Secretary may prescribe in regulations qualifications and 

standards of conduct for individuals recognized under this section, 

including a requirement that, before being recognized, an individual—


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88 

(A) show that such individual is of good moral character and 

in good repute, is qualified to render claimants valuable service, and is otherwise competent to assist claimants in presenting 

claims; 

(B) has such level of experience and specialized training as 

the Secretary shall specify; and 

(C) certifies to the Secretary that the individual has satisfied 

any qualifications and standards prescribed by the Secretary 

under this section. 

(3) The Secretary may prescribe in regulations reasonable restrictions on the amount of fees that an agent or attorney may charge 

a claimant for services rendered in the preparation, presentation, 

and prosecution of a claim before the Department. 

(4)(A) The Secretary may, on a periodic basis, collect a registration fee from individuals recognized as agents or attorneys under 

this section. 

(B) The Secretary shall prescribe the amount and frequency of collection of such fees. The amount of such fees may include an 

amount, as specified by the Secretary, necessary to defray the costs 

to the Department in recognizing individuals under this section, in 

administering the collection of such fees, in administering the payment of fees under subsection (d), and in conducting oversight of 

agents or attorneys. 

(C) Amounts so collected shall be deposited in the account from 

which amounts for such costs were derived, merged with amounts 

in such account, and available for the same purpose, and subject to 

the same conditions and limitations, as amounts in such account. 

(b) The Secretary, after notice and opportunity for a hearing, 

may suspend or exclude from further practice before the Department any agent or attorney recognized under this section if the 

Secretary finds that such agent or attorney—

(1) has engaged in any unlawful, unprofessional, or dishonest 

practice; 

(2) has been guilty of disreputable conduct; 

(3) is incompetent; 

(4) has violated or refused to comply with any of the laws administered by the Secretary, or with any of the regulations or 

instructions governing practice before the Department; øor¿ 

(5) has in any manner deceived, misled, or threatened any 

actual or prospective claimantø.¿; 

(6) has presented frivolous claims, issues, or arguments to the 

Department; or 

(7) has failed to comply with any other condition specified by 

the Secretary in regulations prescribed by the Secretary for purposes of this subsection. 

(c)ø(1) Except as provided in paragraph (3), in connection with a 

proceeding before the Department with respect to benefits under 

laws administered by the Secretary, a fee may not be charged, allowed, or paid for services of agents and attorneys with respect to 

services provided before the date on which the Board of Veterans’

Appeals first makes a final decision in the case. Such a fee may 

be charged, allowed, or paid in the case of services provided after 

such date only if an agent or attorney is retained with respect to 

such case before the end of the one-year period beginning on that 


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date. The limitation in the preceding sentence does not apply to 

services provided with respect to proceedings before a court.¿ 

ø(2)¿ (1) A person who, acting as agent or attorney øin a 

case referred to in paragraph (1) of this subsection¿, represents 

a person before the Department or the Board of Veterans’ Appeals øafter the Board first makes a final decision in the case¿ 

shall file a copy of any fee agreement between them øwith the 

Board at such time as may be specified by the Board¿ with the 

Secretary pursuant to regulations prescribed by the Secretary. 

øThe Board, upon its own motion or the request of either 

party, may review such a fee agreement and may order a reduction in the fee called for in the agreement if the Board finds 

that the fee is excessive or unreasonable. A finding or order of 

the Board under the preceding sentence may be reviewed by 

the United States Court of Appeals for Veterans Claims under 

section 7263(d) of this title.¿ 

(2)(A) The Secretary, upon the Secretary’s own motion or at 

the request of the claimant, may review a fee agreement filed 

pursuant to paragraph (1) and may order a reduction in the fee 

called for in the agreement if the Secretary finds that the fee is 

excessive or unreasonable. 

(B) A finding or order of the Secretary under subparagraph 

(A) may be reviewed by the Board of Veterans’ Appeals under 

section 7104 of this title. 

* * * * * * * 

§ 5905. Penalty for certain acts 

Whoever ø(1) directly or indirectly solicits, contracts for, charges, 

or receives, or attempts to solicit, contract for, charge, or receive, 

any fee or compensation except as provided in sections 5904 or 

1984 of this title, or (2)¿ wrongfully withholds from any claimant 

or beneficiary any part of a benefit or claim allowed and due to the 

claimant or beneficiary, shall be fined as provided in title 18, or imprisoned for not more than one year, or both. 

* * * * * * * 

PART V. BOARDS, ADMINISTRATIONS, AND 

SERVICES 

* * * * * * * 

CHAPTER 73. VETERANS HEALTH ADMINISTRATIONORGANIZATION AND FUNCTIONS 

* * * * * * * 

Subchapter II. General Authority and Administration 

7311. Quality assurance. 

7312. Special medical advisory group. 

7313. Advisory committees: affiliated institutions. 

7314. Geriatric research, education, and clinical centers. 

7315. Geriatrics and Gerontology Advisory Committee. 

7316. Malpractice and negligence suits: defense by United States. 

7317. Hazardous research projects: indemnification of contractors. 

7318. National Center for Preventive Health. 


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7319. Mammography quality standards. 

7320. Centers for mental illness research, education, and clinical activities. 

7321. Committee on Care of Severely Chronically Mentally Ill Veterans. 

7322. Breast cancer mammography policy. 

7323. Required consultations with nurses. 

7324. Annual report on use of authorities to enhance retention of experienced 

nurses. 

7325. Medical emergency preparedness centers. 

7326. Education and training programs on medical response to consequences of terrorist activities. 

7327. Centers for research, education, and clinical activities on complex multi-trauma associated with combat injuries. 

7328. Medical preparedness centers. 

7329. Parkinson’s disease research, education, and clinical centers and multiple sclerosis centers of excellence. 

* * * * * * * 

§ 7328. Medical preparedness centers 

* * * * * * * 

§ 7329. Parkinson’s disease research, education, and clinical 

centers and multiple sclerosis centers of excellence 

(a) DESIGNATION.—The Secretary, upon the recommendation of 

the Under Secretary for Health and pursuant to the provisions of 

this section, shall—

(1) designate—

(A) at least 6 Department health care facilities as the locations for centers of Parkinson’s disease research, education, and clinical activities and (subject to the appropriation of sufficient funds for such purpose); and 

(B) at least 2 Department health care facilities as the locations for Multiple Sclerosis Centers of Excellence (subject 

to the appropriation of sufficient funds for such purpose); 

and 

(2) establish and operate such centers at such locations in accordance with this section. 

(b) EXISTING FACILITIES; GEOGRAPHIC DISTRIBUTION.—In designating locations for centers under subsection (a), the Secretary, 

upon the recommendation of the Under Secretary for Health, shall—

(1) designate each Department health care facility that, as of 

January 1, 2005, was operating a Parkinson’s Disease Research, Education, and Clinical Center or a Multiple Sclerosis 

Center of Excellence unless the Secretary, on the recommendation of the Under Secretary for Health, determines that such facility—

(A) does not meet the requirements of subsection (c); 

(B) has not demonstrated effectiveness in carrying out the 

established purposes of such center; or 

(C) has not demonstrated the potential to carry out such 

purposes effectively in the reasonably foreseeable future; 

and 

(2) assure appropriate geographic distribution of such facilities. 

(c) MINIMUM REQUIREMENTS.—The Secretary may not designate a 

health care facility as a location for a center under subsection (a) 

unless—


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(1) the peer review panel established under subsection (d) determines that the proposal submitted by such facility is among 

those proposals which meet the highest competitive standards of 

scientific and clinical merit; and 

(2) the Secretary, upon the recommendation of the Under Secretary for Health, determines that the facility has (or may reasonably be anticipated to develop)— (A) an arrangement with an accredited medical school 

which provides education and training in neurology and 

with which such facility is affiliated under which residents 

receive education and training in innovative diagnosis and 

treatment of chronic neurodegenerative diseases and movement disorders, including Parkinson’s disease, or in the 

case of Multiple Sclerosis Centers, multiple sclerosis disease; 

(B) the ability to attract the participation of scientists 

who are capable of ingenuity and creativity in health-care 

research efforts; 

(C) a policymaking advisory committee composed of consumers and appropriate health care and research representatives of the facility and of the affiliated school or schools 

to advise the directors of such facility and such center on 

policy matters pertaining to the activities of such center 

during the period of the operation of such center; 

(D) the capability to conduct effectively evaluations of the 

activities of such center; 

(E) the capability to coordinate, as part of an integrated 

national system, education, clinical, and research activities 

within all facilities with such centers; 

(F) the capability to jointly develop a consortium of providers with interest in treating neurodegenerative diseases, 

including Parkinson’s disease, and other movement disorders, or multiple sclerosis in the case of Multiple Sclerosis Centers, at facilities without such centers in order to 

ensure better access to state of the art diagnosis, care, and 

education for neurodegenerative disorders, or in the case of 

the Multiple Sclerosis Centers, autoimmune disease affecting the central nervous system throughout the health care 

system; and 

(G) the capability to develop a national repository in the 

health care system for the collection of data on health services delivered to veterans seeking care for neurodegenerative 

diseases, including Parkinson’s disease, and other movement disorders, or in the case of Multiple Sclerosis Centers, 

autoimmune disease affecting the central nervous system. 

(d) PANEL.—

(1) The Under Secretary for Health shall establish a panel to 

assess the scientific and clinical merit of proposals that are submitted to the Secretary for the establishment of new centers 

under this section. 

(2)(A) The membership of the panel shall consist of experts in 

neurodegenerative diseases, including Parkinson’s disease and 

other movement disorders, and, in the case of Multiple Sclerosis 

Centers, experts in autoimmune disease affecting the central 

nervous system. 


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(B) Members of the panel shall serve as consultants to the Department for a period of no longer than 2 years except in the 

case of panelists asked to serve on the initial panel as specified 

in subparagraph (C). 

(C) In order to ensure panel continuity, half of the members 

of the first panel shall be appointed for a period of 3 years and 

half for a period of 2 years. 

(3) The panel shall review each proposal submitted to the 

panel by the Under Secretary and shall submit its views on the 

relative scientific and clinical merit of each such proposal to the 

Under Secretary. 

(4) The panel shall not be subject to the Federal Advisory 

Committee Act. 

(e) ADEQUATE FUNDING.—Before providing funds for the operation 

of any such center at a health care facility other than a health care 

facility designated under subsection (b)(1), the Secretary shall ensure that—(1) the Parkinson’s disease center at each facility designated 

under subsection (b)(1) is receiving adequate funding to enable 

such center to function effectively in the areas of Parkinson’s 

disease research, education, and clinical activities; and 

(2) in the case of a new Multiple Sclerosis Center, that existing centers are receiving adequate funding to enable such centers to function effectively in the areas of multiple sclerosis research, education, and clinical activities. 

(f) AUTHORIZATION OF APPROPRIATIONS.— (1) There are authorized to be appropriated such sums as 

may be necessary for the support of the research and education 

activities of the centers established under subsection (a). 

(2) The Under Secretary for Health shall allocate to such centers from other funds appropriated generally for the Department of medical services account and medical and prosthetics 

research account, as appropriate, such amounts as the Under 

Secretary for Health determines appropriate. 

(g) FUNDING ELIGIBILITY AND PRIORITY FOR PARKINSON’S DISEASE

RESEARCH.—Activities of clinical and scientific investigation at each 

center established under subsection (a) for Parkinson’s disease 

shall—

(1) be eligible to compete for the award of funding from funds 

appropriated for the Department medical and prosthetics research account; and 

(2) receive priority in the award of funding from such account 

to the extent funds are awarded to projects for research in Parkinson’s disease and other movement disorders. 

(h) FUNDING ELIGIBILITY AND PRIORITY FOR MULTIPLE SCLEROSIS

RESEARCH.—Activities of clinical and scientific investigation at each 

center established under subsection (a) for multiple sclerosis shall—

(1) be eligible to compete for the award of funding from funds 

appropriated for the Department medical and prosthetics research account; and 

(2) receive priority in the award of funding from such account 

to the extent funds are awarded to projects for research in multiple sclerosis and other movement disorders. 

* * * * * * * 


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PART VI. ACQUISITION AND DISPOSITION OF 

PROPERTY 

* * * * * * * 

CHAPTER 81. ACQUISITION AND OPERATION OF HOSPITAL AND DOMICILIARY FACILITIES; PROCUREMENT 

AND SUPPLY; ENHANCED-USE LEASES OF REAL PROPERTY 

* * * * * * * 

Subchapter III. State Home Facilities for Furnishing 

Domiciliary, Nursing Home, and Hospital Care 

8131. Definitions. 

8132. Declaration of purpose. 

8133. Authorization of appropriations. 

8134. General regulations. 

8135. Applications with respect to projects; payments. 

8136. Recapture provisions. 

8137. State control of operations. 

8138. Treatment of certain health facilities as State homes. 

* * * * * * * 

§ 8137. State control of operations 

* * * * * * * 

§ 8138. Treatment of certain health facilities as State homes 

(a) The Secretary may treat a health facility, or certain beds in 

a health facility, as a State home for purposes of subchapter V of 

chapter 17 of this title if the following requirements are met: 

(1) The facility, or certain beds in such facility, meets the 

standards for the provision of nursing home care that is applicable to State homes, as prescribed by the Secretary under section 8134(b) of this title, and such other standards relating to 

the facility, or certain beds in such facility, as the Secretary 

may require. 

(2) The facility, or certain beds in such facility, is licensed or 

certified by the appropriate State and local agencies charged 

with the responsibility of licensing or otherwise regulating or 

inspecting State home facilities. 

(3) The State demonstrates in an application to the Secretary 

that, but for the treatment of a facility (or certain beds in such 

facility), as a State home under this subsection, a substantial 

number of veterans residing in the geographic area in which the 

facility is located who require nursing home care will not have 

access to such care. 

(4) The Secretary determines that the treatment of the facility, 

or certain beds in such facility, as a State home best meets the 

needs of veterans for nursing home care in the geographic area 

in which the facility is located. 

(5) The Secretary approves the application submitted by the 

State with respect to the facility, or certain beds in such facility. 

(b) The Secretary may not treat a health facility, or certain beds 

in a health facility, as a State home under subsection (a) if the Secretary determines that such treatment would increase the number of 


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beds allocated to the State in excess of the limit on the number of 

beds provided for by regulations prescribed under section 8134(a) of 

this title. 

(c) The number of beds occupied by veterans in a health facility 

for which payment may be made under subchapter V of chapter 17 

of this title by reason of subsection (a) shall not exceed—

(1) 100 beds in the aggregate for all States; and 

(2) in the case of any State, the difference between—

(A) the number of veterans authorized to be in beds in 

State homes in such State under regulations prescribed 

under section 8134(a) of this title; and 

(B) the number of veterans actually in beds in State 

homes (other than facilities or certain beds treated as State 

homes under subsection (a)) in such State under regulations prescribed under such section. 

(d) The number of beds in a health facility in a State that has 

been treated as a State home under subsection (a) shall be taken 

into account in determining the unmet need for beds for State 

homes for the State under section 8134(d)(1) of this title. 

(e) The Secretary may not treat any new health facilities, or any 

new certain beds in a health facility, as a State home under subsection (a) after September 20, 2009. 

* * * * * * * 

TITLE 42, UNITED STATES CODE 

* * * * * * * 

CHAPTER 8. LOW-INCOME HOUSING 

* * * * * * * 

§ 1437f. Low-income housing assistance 

(o) * * * 

* * * * * * * 

(19) * * * 

ø(B) AMOUNT.—The amount specified in this subparagraph is—

ø(i) for fiscal year 2003, the amount necessary to 

provide 500 vouchers for rental assistance under this 

subsection; 

ø(ii) for fiscal year 2004, the amount necessary to 

provide 1,000 vouchers for rental assistance under this 

subsection; 

ø(iii) for fiscal year 2005, the amount necessary to 

provide 1,500 vouchers for rental assistance under this 

subsection; and 

ø(iv) for fiscal year 2006, the amount necessary to 

provide 2,000 vouchers for rental assistance under this 

subsection.¿ 

(B) AMOUNT.—The amount specified in this subparagraph is—


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(i) for fiscal year 2007, the amount necessary to provide 500 vouchers for rental assistance under this subsection; 

(ii) for fiscal year 2008, the amount necessary to provide 1,000 vouchers for rental assistance under this 

subsection; 

(iii) for fiscal year 2009, the amount necessary to 

provide 1,500 vouchers for rental assistance under this 

subsection; and 

(iv) for fiscal year 2010, the amount necessary to provide 2,000 vouchers for rental assistance under this 

subsection; and 

(v) for fiscal year 2011, the amount necessary to provide 2,500 vouchers for rental assistance under this 

subsection. 

ø(C) FUNDING THROUGH INCREMENTAL ASSISTANCE.—In 

any fiscal year, to the extent that this paragraph requires 

the Secretary to set aside rental assistance amounts for 

use under this paragraph in an amount that exceeds the 

amount set aside in the preceding fiscal year, such requirement shall be effective only to such extent or in such 

amounts as are or have been provided in appropriation 

Acts for such fiscal year for incremental rental assistance 

under this subsection.¿ 

Æ 


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