Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 85055 

Rev. 1. A Record of Environmental 

Consideration supporting this 

determination is available in the docket. 

For instructions on locating the docket, 

see the ADDRESSES section of this 

preamble. 

G. Protest Activities 

The Coast Guard respects the First 

Amendment rights of protesters. 

Protesters are asked to call or email the 

person listed in the FOR FURTHER

INFORMATION CONTACT section to 

coordinate protest activities so that your 

message can be received without 

jeopardizing the safety or security of 

people, places, or vessels. 

List of Subjects in 33 CFR Part 165 

Harbors, Marine safety, Navigation 

(water), Reporting and recordkeeping 

requirements, Security measures, 

Waterways. 

For the reasons discussed in the 

preamble, the Coast Guard amends 33 

CFR part 165 as follows: 

PART 165—REGULATED NAVIGATION 

AREAS AND LIMITED ACCESS AREAS 

■ 1. The authority citation for part 165 

continues to read as follows: 

Authority: 46 U.S.C. 70034, 70051, 70124; 

33 CFR 1.05–1, 6.04–1, 6.04–6, and 160.5; 

Department of Homeland Security Delegation 

No. 00170.1, Revision No. 01.3. 

■ 2. Add § 165.T08–0957 to read as 

follows: 

§ 165.T08–0957 Fixed and Moving Safety 

Zone; Vicinity of the M/VPIETERSGRACHT, 

Houston Ship Channel and Morgan’s Point, 

TX. 

(a) Location. The following areas are 

temporary safety zones: 

(1) Moving Safety Zone. All waters 

within a 100-yard radius of the M/V 

PIETERSGRACHT, as the vessel transits 

from the approximate coordinates 

29°19′01.21′′ N, 094°38′38.1′′ W, off the 

coast of Galveston, TX, and proceeds 

through the Houston Ship Channel to 

the assigned docking station. 

(2) Fixed Safety Zone. All waters 

within a 25-yard radius of the M/V 

PIETERSGRACHT while moored at the 

Barbours Cut Terminal in Morgan’s 

Point, Texas. 

(b) Definition. The term ‘‘designated 

representative’’ means Coast Guard 

Patrol Commanders, including Coast 

Guard coxswains, petty officers, and 

other officers operating Coast Guard 

vessels, and Federal, state, and local 

officers designated by or assisting the 

Captain of the Port Sector HoustonGalveston (COTP) in the enforcement of 

the safety zones. 

(c) Regulations. (1) Under the general 

safety zone regulations in subpart C of 

this part, all persons and vessels are 

prohibited from entering, transiting 

through, anchoring in, or remaining 

within the safety zones described in 

paragraph (a) of this section unless 

authorized by the COTP or the COTP’s 

designated representative. 

(2) Persons and vessels may request 

authorization to enter, transit through, 

anchor in, or remain within the safety 

zones by contacting the COTP by 

telephone at 866–539–8114, or the 

COTP’s designated representative via 

VHF radio on channel 16. If 

authorization is granted by the COTP or 

the COTP’s designated representative, 

all persons and vessels receiving such 

authorization must comply with the 

lawful instructions of the COTP or the 

COTP’s designated representative. 

(d) Enforcement period. This rule will 

be subject to enforcement from 1 a.m. on 

October 29, 2024, through 5 p.m. on 

November 15, 2024. 

Keith M. Donohue, 

Captain, U.S. Coast Guard, Captain of the 

Port Sector Houston-Galveston. 

[FR Doc. 2024–24757 Filed 10–24–24; 8:45 am] 

BILLING CODE 9110–04–P 

DEPARTMENT OF VETERANS 

AFFAIRS 

38 CFR Part 14 

RIN 2900–AR93 

Fee Reasonableness Reviews; Effect 

of Loss of Accreditation on Direct 

Payment 

AGENCY: Department of Veterans Affairs. 

ACTION: Final rule. 

SUMMARY: The Department of Veterans 

Affairs (VA) is issuing this final rule to 

address its process for reviewing, 

determining, and allocating reasonable 

fees for claim representation, and to 

address the effect on direct payment of 

the termination of a claims agent’s or 

attorney’s VA accreditation. 

DATES: 

Effective date: This final rule is 

effective April 1, 2025. 

Applicability date: The provisions of 

this final rule shall apply to all fee 

allocation notices issued on or after the 

effective date of this final rule. 

FOR FURTHER INFORMATION CONTACT: 

Jonathan Taylor, Office of General 

Counsel (022D), 810 Vermont Avenue 

NW, Washington, DC 20420, (202) 461– 

7699. (This is not a toll-free telephone 

number.) 

SUPPLEMENTARY INFORMATION: On 

December 21, 2023, VA published in the 

Federal Register (88 FR 88,295) a 

proposed rule to address its process for 

reviewing, determining, and allocating 

reasonable fees for claim representation, 

and to address the effect on direct 

payment of the termination of a claims 

agent’s or attorney’s VA accreditation. 

The proposed rule allowed for a 

comment period ending on February 20, 

2024. During the comment period, VA 

received 15 comments, which are 

discussed below. After considering 

these comments, VA has decided to 

finalize the proposed rule without 

amendment. 

Comments on Representatives and Fees 

Generally 

One commenter stated that ‘‘the tone 

of [VA’s] proposal suggests that attorney 

involvement in the [claims] process is 

part of some problem.’’ VA thanks the 

commenter for this comment, but, to be 

clear, VA takes no issue with VAaccredited attorneys and claims agents 

(hereinafter ‘‘agents’’) assisting 

claimants and recognizes the important 

service they provide. But the fact of the 

matter is that there has been an increase 

in multi-attorney and multi-agent cases 

and, when those agents and attorneys 

request direct payment, VA needs an 

efficient process to allocate fees in all 

those cases. This rule provides such a 

process. And this rule’s process will (1) 

empower agents and attorneys to 

negotiate fees on their own and (2) 

deliver fees to agents and attorneys 

more expeditiously (and benefits to 

veterans more expeditiously). Those are 

not anti-attorney or anti-agent measures 

or results. 

Another commenter stated that fees 

should be a matter between a veteran 

and representative, and that 

representatives should not get fees from 

VA. VA thanks the commenter, but—to 

be clear—VA does not pay 

representatives independently. VA only 

pays representatives (out of a claimant’s 

past-due benefits) when the claimant 

and the representative have requested it. 

And, under this rule, VA will only get 

involved with the question of fees when 

(1) direct payment is requested or (2) a 

fee reasonableness review is requested 

or otherwise warranted. Moreover, 

consistent with this commenter’s 

general view on fee matters, this rule 

sets forth reasonable default allocations 

that will allow claimants and 

representatives to resolve fee matters on 

their own in many cases. Nevertheless, 

if that effort is unsuccessful, VA’s Office 

of General Counsel (OGC) remains 

available to review and decide a 

reasonable fee allocation for the case. 

A third commenter stated that VA 

should ‘‘require agents or attorneys to 


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85056 Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 

request a fee reasonableness review[ ] in 

order to receive direct payment.’’ VA 

appreciates this comment, but has not 

been provided evidence of widespread 

acceptance of unreasonable fees that 

would warrant such a drastic action of 

not releasing any fees absent 

individualized review. Particularly 

given the workload burden that 

approach would create, and the legal 

presumption of fee reasonableness for 

certain agents or attorneys under 38 CFR 

14.636(f)(1), VA declines to implement 

that approach at this time. 

VA makes no changes in response to 

these comments. 

Comments on Unaccredited Companies 

and Upfront Fees 

One commenter stated that the 

proposed rule was excellent, but 

questioned how VA was dealing with 

unaccredited companies that charge 

high fees to veterans. Another 

commenter similarly stated support for 

limitations on fees, but was concerned 

about individuals and companies 

charging upfront fees. A third 

commenter stated that VA needs to shut 

down unaccredited companies that ‘‘rob 

veterans, botch claims, and cost 

vet[eran]s benefits.’’ The commenter 

requested that VA refer these companies 

to its Office of Inspector General (OIG) 

and the Department of Justice (DOJ). A 

fourth commenter stated that VA should 

be taking action against unaccredited 

actors, rather than further regulating 

accredited agents and attorneys. The 

commenter stated that this rule ‘‘creates 

more opportunity for unaccredited 

actors to enter this space.’’ 

The issues of unaccredited companies 

and upfront fees are beyond the scope 

of this particular rulemaking. But they 

are issues VA is actively pursuing in 

other realms, including coordination 

with OIG and DOJ, and we do want to 

take this opportunity to reiterate the 

following: No individual or organization 

that lacks VA accreditation may charge 

any fee for preparation, presentation, or 

prosecution of a VA benefits claim. 38 

U.S.C. 5901. And no individual or 

organization (even with accreditation) 

may charge a fee to a veteran for 

services on a VA benefits claim prior to 

the initial decision on the claim. 38 

U.S.C. 5904(c). Veterans can protect 

themselves against unaccredited 

companies involved in predatory 

practices by only engaging with VAaccredited representatives on VA 

benefits issues. Moreover, in view of 

VA’s oversight of and authority 

regarding accredited representatives, 

veterans engaging with VA-accredited 

representatives can avail themselves of 

the fee reasonableness process described 

in this rule if they believe they are being 

charged an unreasonable fee. 

As to the fourth commenter’s 

allegation that this rule ‘‘creates more 

opportunity for unaccredited actors to 

enter this space,’’ we do not understand 

the basis for this allegation. To the 

extent the allegation is related to VA’s 

statement that including claimants in 

the default allocation of § 14.636(i)(1)(ii) 

‘‘accounts for the possibility that the 

claimant may have entered into a nondirect pay agreement with other agents 

or attorneys’’ (88 FR at 88,296), that 

statement is referring to accredited 

agents and attorneys, not unaccredited 

actors, as confirmed by § 14.636(b) 

(‘‘Only accredited agents and attorneys 

may receive fees from claimants 

. . . .’’). Alternatively, to the extent the 

allegation is based on the commenter’s 

belief that this rule ‘‘could create’’ a 

disincentive for accredited agents or 

attorneys to represent claimants, we 

disagree with that premise, as further 

explained below. 

VA makes no change to this rule in 

response to these comments, but 

nevertheless thanks the commenters for 

raising this important issue. 

Comments on Declining Direct Payment 

for Agents or Attorneys Whose VA 

Accreditation Has Been Terminated 

One commenter expressed ‘‘full 

support’’ for VA’s proposal to decline 

direct payment for agents or attorneys 

who have had their accreditation 

revoked (§ 14.636(h)(1)(iii)). Another 

commenter agreed with such an 

approach, and applauded VA’s efforts to 

strengthen regulations that protect 

veterans and their dependents from 

unreasonable fees. A third commenter, 

however, was concerned ‘‘with the 

impact this policy may have on those 

who voluntarily terminate their 

accreditation due to illness or 

retirement.’’ The commenter questioned 

‘‘whether these individuals will lose 

their fees or be forced to stay accredited 

to receive earned fees even when they 

are no longer taking on new clients.’’ 

VA thanks each of the commenters on 

this issue. As to the last commenter’s 

question, under this rule, even though 

there will be no direct payment for 

agents or attorneys whose VA 

accreditation has been terminated, that 

does not mean they lose the right to 

previously-earned fees or are forced to 

stay accredited to retain fee eligibility. 

Rather, upon receipt of a fee allocation 

notice, if they believe they deserve a fee 

from the award at issue, they can work 

out an arrangement with the other 

parties or (if that is unsuccessful) can 

request an OGC fee reasonableness 

review. In sum, while VA will no longer 

directly pay agents or attorneys who 

have lost their accreditation, this rule 

still allows those individuals to pursue 

a fee if they believe they have earned 

one in the case. 

VA makes no change in response to 

these comments. 

Comments on Current Fee 

Reasonableness Wait Times 

One commenter stated that their law 

firm has five cases that have been 

pending fee reasonableness review since 

2022, even though all the attorneys on 

the case were from the same firm. A 

similar commenter stated that they are 

currently waiting for a fee 

reasonableness determination, there is 

no timeline for such a determination, 

and that the process is haphazard. A 

third commenter stated that fee matters 

are ‘‘often inexplicably and 

systematically delayed.’’ A fourth 

commenter described their ‘‘unpleasant 

experience’’ waiting over 430 days for a 

fee reasonableness review that ‘‘lacks 

any sort of transparent business 

process.’’ This commenter stated that 

the case was referred for a 

reasonableness review simply because 

another attorney—who did not 

represent the claimant at the Board of 

Veterans’ Appeals (Board) and now 

remained silent on the issue of fees— 

had represented the claimant six years 

prior. 

VA thanks these commenters. This 

rule has been designed to remedy this 

issue and reduce fee reasonableness 

wait times. With the institution of 

reasonable default allocation rules, there 

will be less cases in the queue for a fee 

reasonableness review; thus, those cases 

that warrant such review will receive a 

determination more promptly. The first 

commenter’s situation is an apt 

example. Under this rule, if no party 

objects to the default allocation within 

60 days, VA may immediately release 

the fee to the successor attorney at the 

firm (or split the fee, depending on 

which default allocation rule applies). 

See 38 CFR 14.636(i)(1)–(2). Parties will 

no longer have to wait for a fee 

reasonableness review just because two 

attorneys represented the claimant. The 

fourth commenter’s situation is also 

instructive. Even though another 

attorney provided representation six 

years prior, if no party objects within 60 

days, the commenter could receive the 

entire fee shortly thereafter (assuming 

the § 14.636(i)(1) default is applicable). 

Moreover, the efficiency gains under 

this rule could also free up OGC 

resources to implement business 

practices that better serve the parties 

during the fee reasonableness process. 

Because this rule remedies these 


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Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 85057 

1Herein, ‘‘discharged’’ refers to representatives 

who were either discharged or withdrew from the 

representation prior to the award of benefits. 

2As merely an initial baseline, the default has no 

effect once a party requests OGC review. 88 FR at 

88,296. 

commenters’ concerns, VA makes no 

change in response to the comments. 

The fourth commenter further stated 

that the increase in fee reasonableness 

case inventory was the result of VA’s 

policy choice to refer all direct-pay 

multi-attorney or multi-agent matters for 

a fee reasonableness review without any 

opportunity for the parties to resolve the 

matter on their own. We do not dispute 

that VA’s policy to refer to OGC all 

direct-pay multi-attorney/agent fee 

matters, in conjunction with the rising 

number of multi-attorney/agent matters, 

has been a factor for the increase. 

Because there was no rule setting forth 

default allocations, VA had to refer all 

these cases for a determination on how 

much to pay each agent or attorney. 

Now, however, as stated in the preamble 

to the proposed rule, VA believes that 

the best course forward is to establish 

default allocation rules, which will 

allow veterans and representatives the 

opportunity to resolve fee matters on 

their own in lieu of a fee reasonableness 

review. 88 FR at 88,295. We believe this 

approach accords with the commenter’s 

view. VA thanks the commenter and 

makes no change in response to the 

comment. 

Comments on the § 14.636(i)(1)(i) 

Default Allocation 

One commenter expressed support for 

the default allocation for cases involving 

a ‘‘continuous’’ agent or attorney, 

§ 14.636(i)(1)(i), stating that such an 

allocation ‘‘incentivizes ethical behavior 

and the high quality representation that 

our Veterans deserve.’’ The commenter 

stated that there is an ‘‘unethical (but 

sadly widespread) practice wherein a 

representative submits a few documents 

on behalf of a client, drops 

representation of that client, and then 

sits back and collects fees for the next 

5–10 years based on the work done by 

subsequent representatives or by the 

Veteran on his [or her] own.’’ According 

to the commenter, this default properly 

prioritizes ‘‘protecting honest Veterans 

from unscrupulous representatives’’ and 

‘‘encouraging ethical and responsible 

legal representation of Veterans’’ over 

certain representatives’ attempts ‘‘to 

collect fees from awards granted to 

Veterans long after their representation 

ends.’’ A second commenter, however, 

expressed concern with this default 

allocation, stating that a discharged 

agent or ‘‘attorney can spend years 

developing evidence, submitting 

argument, consulting with and advising 

a client, and investing other resources 

on a case. . . . VA would entirely 

ignore all these services and simply 

award the fee to the ‘continuous’ agent 

or attorney.’’ 

VA thanks both commenters for their 

comments. We agree with several of the 

points made by the first commenter. As 

to the second commenter’s concern, we 

acknowledge that there are situations 

where the discharged 1 agent or attorney 

performed more valuable services for 

the claim than the continuous agent or 

attorney; there are also situations where 

the continuous agent or attorney 

performed the more valuable services. 

Accordingly, we structured the default 

allocation to be nothing more than an 

initial baseline: If the discharged agent 

or attorney (or the claimant) disagrees 

with the default in a given case, the 

parties have a 60-day window to resolve 

the matter on their own—and, if an 

agreement cannot be reached, OGC 

reasonableness review is available.2 But 

the efficiency gain of a default is that— 

if no party has an issue with the 

continuous agent or attorney receiving 

the fee, or if the parties reach an 

agreement on their own as to how they 

will re-allocate the fee after its release— 

that is the end of the matter and OGC 

will not have to adjudicate a case that 

no party has asked it to resolve. 

Accordingly, VA makes no change in 

response to these comments. 

Comments on the § 14.636(i)(1)(ii) 

Default Allocation 

One commenter expressed concern 

with the default allocation for cases 

where all agents and attorneys have 

been discharged, § 14.636(i)(1)(ii), 

stating that ‘‘VA would treat both 

attorneys equally, even if the latter 

performed only minimal work.’’ VA 

thanks the commenter for the comment, 

but, again, the default allocation is just 

an initial baseline; if any party believes 

the default split is not reasonable in a 

given case, the parties can work out on 

their own how to re-allocate the fee after 

receipt or (if that effort proves 

unsuccessful) request OGC review. The 

default is not there to assume that all 

cases with discharged agents or 

attorneys involve equal work by those 

agents or attorneys; it is there to provide 

a generally reasonable baseline that will 

be satisfactory to the parties in many 

circumstances and will enable OGC to 

focus its resources on those cases where 

a party has affirmatively expressed a 

desire for OGC review. 

Another commenter recalled a 

situation in which their client was 

‘‘unknowingly solicited to sign a new 

[representation] agreement’’ with 

another entity, such that they 

subsequently had to re-establish 

representation of the client. The 

commenter stated that, under this rule, 

the ‘‘soliciting entity could have 

received an equal split’’ or ‘‘I may have 

been boxed out of my fees,’’ i.e., ‘‘my 

years of work may have been thrown 

away or allocated out by default because 

a different or multiple representatives 

could have existed on decision day.’’ 

VA thanks the commenter, but, to be 

clear, in this situation, so long as the 

representation is re-established prior to 

the date of the award of benefits (and is 

direct-pay eligible), the commenter 

would be allocated the entire fee under 

§ 14.636(i)(1)(i). If the representation is 

not re-established in time, the 

commenter would nevertheless receive 

the fee allocation notice and, if 

dissatisfied with a § 14.636(i)(1)(ii) split, 

could request OGC review to ensure 

receipt of a reasonable fee. Accordingly, 

this rule provides agents and attorneys 

in such circumstances a sufficient 

remedy. 

A third commenter stated opposition 

to a ‘‘default fee split of any kind’’ 

because it ‘‘unlawfully impose[s] fee 

sharing’’ and is unethical under ABA 

Formal Opinion 487. See ABA Comm. 

On Ethics & Prof’l Responsibility, 

Formal Op. 487 (2019). VA thanks the 

commenter, but Opinion 487 addresses 

a successor counsel’s obligations to its 

client and prior counsel upon (and prior 

to) fee receipt; it does not address an 

agency’s authorities or obligations under 

38 U.S.C. 5904 in a multi-agent or multiattorney case. To be clear, we do not 

dispute the relevance of this opinion in 

terms of the ethical obligations of 

representatives. Indeed, in the preamble 

to its proposed rule, VA stated that, 

‘‘upon receipt of a fee allocation notice, 

the agent or attorney has a professional 

responsibility to review the default fee 

and ensure that it is not clearly 

unreasonable; if it is, that agent or 

attorney has an ethical obligation to 

return that fee to the claimant.’’ 88 FR 

at 88,296. VA further emphasized that 

‘‘[t]he failure to return the fee to the 

claimant in such circumstances could 

constitute a violation of VA’s standards 

of conduct warranting suspension or 

cancellation of the agent’s or attorney’s 

accreditation to represent claimants 

before VA.’’ Id. So, we agree that the 

Model Rules of Professional Conduct 

and Opinion 487 are relevant to agent 

and attorney obligations under this rule, 

but we do not agree that either ethically 

precludes VA from implementing this 

rule. We also do not agree with the 

commenter’s allegation that this rule 

imposes mandatory fee sharing; as 


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85058 Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 

3We will take this opportunity to note that the 

data for the first three quarters of fiscal year 2023 

(88 FR at 88,296) remained consistent through the 

last quarter. In total, of the 115 fee reasonableness 

decisions issued in fiscal year 2023 addressing the 

situation where all agents and attorneys had been 

discharged, OGC returned some of the potential fee 

to the claimant in 103 of those decisions (89%). 

Overall, $2.2 million was at stake in these 115 

cases, and OGC returned $1.52 million to claimants 

(69% of the amount at stake). This data further 

confirms that § 14.636(i)(1)(ii) provides a generally 

reasonable baseline for this type of case. 

4Though OGC may still initiate its own review, 

§ 14.636(i)(4), this rule was structured so that most 

of its reviews would be the product of party 

initiation. 

5The above data (as well as the data provided in 

the preamble to the proposed rule) has been placed 

on the rulemaking docket, available at 

www.regulations.gov. 

stated above, the default allocation is 

just an initial baseline, and if any agent 

or attorney believes they should not 

have to share a fee with another 

representative, they can simply file for 

OGC reasonableness review. 

Accordingly, VA makes no change in 

response to these comments. 

Comments on Fee Reasonableness Data 

One commenter stated that the ‘‘very 

small pool of data’’ presented by VA in 

the preamble to the proposed rule (88 

FR at 88,296) was insufficient to ‘‘draw 

a sweeping conclusion that a client 

should automatically be part of the 

default allocation,’’ when considering 

‘‘the large number of fees awarded in a 

year that never are contested.’’ Another 

commenter stated that different data— 

comparing the cases that returned some 

of the potential fee to the claimant with 

‘‘the total number of cases where fees 

were generated, entitlement was 

established, and there was no referral or 

contest to OGC’’—would be more 

relevant. 

VA appreciates these comments, but 

disagrees about what data is most 

relevant here. The purpose of the data 

presented in the preamble to the 

proposed rule was to explain why we 

included the claimant in the default 

allocation for cases where all agents or 

attorneys were discharged. 38 CFR 

14.636(i)(1)(ii). We reviewed the data for 

OGC reviews in such cases (not just a 

sample, but the entire pool of such cases 

from fiscal year 2022 and the first threequarters of fiscal year 2023); the data 

reflected that—more often than not— 

OGC found it reasonable to return some 

of the potential fee to the claimant; and 

we concluded (for this reason and 

others, see 88 FR at 88,296) that a 

default that included the claimant in the 

allocation was a generally reasonable 

baseline for this type of case. Comparing 

this data to the total number of cases 

where OGC review was not provided is 

less relevant, because chronicling the 

number of cases where no entity 

decided reasonableness does not 

illuminate what a generally reasonable 

baseline for this type of case would or 

should be.3

A third commenter stated that VA’s 

data reflects that OGC should continue 

reviewing fee reasonableness for every 

multi-agent or multi-attorney case. VA 

appreciates this comment, but the data 

presented was not addressing all multiagent or multi-attorney cases; it was 

only addressing cases where all agents 

or attorneys had been discharged; and 

there is no basis for assuming that the 

data from this subset of cases is 

replicated for ‘‘continuous’’ agent or 

attorney matters, where fundamentally 

different factors are at play that 

generally result in the return of less 

money to claimants, including (1) the 

fact that the favorable decision awarding 

benefits was obtained during the 

representation and (2) the presumption 

that the continuous representative’s fee 

is reasonable under § 14.636(f)(1). In 

general, VA believes that OGC’s time 

and resources should be primarily 

dedicated to protecting claimants from 

unreasonable fees and resolving 

disputes over fees, rather than sua 

sponte deciding a fee allocation between 

attorneys or agents at no benefit to a 

claimant (as occurs in many cases where 

the § 14.636(f)(1) presumption of fee 

reasonableness applies). 

A fourth commenter suggested that 

additional data—regarding OGC’s 

inventory, OGC’s oldest pending cases, 

VA regional offices that refer cases to 

OGC, and the percentage of OGC’s cases 

initiated by a party—would be relevant. 

While VA does not have comprehensive 

data on all these issues, a review of 

OGC’s incoming cases from the first 

quarter of fiscal year 2024 reflects that 

77.5% of incoming cases were referred 

by the Veterans Benefits 

Administration, while 22.5% were the 

result of a party’s request for review. 

Moreover, a sample of 138 OGC cases 

decided between March 2022 and 

January 2024 reflects that, on average, a 

decision on fee reasonableness was 

issued 2.9 years after VA’s 

determination on fee eligibility. This 

data confirms that this rule’s 

fundamental change—from automatic 

OGC review of direct-pay multi-agent or 

multi-attorney cases to party-initiated 

review 4—is likely to have a significant 

effect on efficiency and to enable both 

representatives and veterans to receive 

their fees and benefits faster.5

VA makes no change in response to 

these comments. 

Comments on Allowing for Compromise 

Between the Parties 

One commenter expressed 

appreciation for ‘‘the time and effort 

OGC exerted to propose a solution’’ for 

expediting fee matters and agreed with 

VA that ‘‘there are many fee matters that 

can be worked out between the parties’’ 

(quoting 88 FR at 88,295). However, the 

commenter then opined that VA’s 

proposal ‘‘does not provide for such 

resolutions’’ and suggested that ‘‘parties 

should be permitted to submit a 

negotiated agreement.’’ Another 

commenter stated that VA should 

‘‘create a process for attorneys and 

accredited agents’’ to submit a 

‘‘consented arrangement.’’ A third 

commenter suggested that ‘‘VA create a 

form in which attorneys and accredited 

agents clearly state the mutually 

requested allocation of the fee, waive 

the rights to appeal and to 

reasonableness review, and in which 

claimants could additionally opt to 

waive the 60-day due process period. 

Upon receipt of this form signed by all 

parties, VA would simply release 

payment according to the parties’ 

mutual agreement.’’ The commenter 

stated that this process would not 

‘‘overlook[ ] the possibility of a 

reasonable compromise [on fees] 

between accredited agents and 

attorneys.’’ 

VA thanks the commenters for these 

suggestions. But this final rule does 

allow for ‘‘negotiated agreement[s]’’ or 

‘‘consented arrangement[s],’’ and does 

not overlook the possibility of 

compromise amongst the parties at 

issue. Indeed, VA has structured the 

default allocation rules so that the 

parties have a 60-day window to reach 

a compromise on their own. If a 

compromise is reached, there is no need 

to submit anything to VA: VA will 

release the fee in accord with the fee 

allocation notice and the parties can 

simply re-allocate the fee on their own 

in accord with the compromise reached. 

Thus, this final rule achieves the same 

aims as the commenters’ proposals. 

Moreover, while achieving the same 

aims, the final rule is preferable to the 

commenters’ proposals. The 

commenters’ proposals would require 

OGC review whenever an agreement is 

not submitted; this final rule would 

require OGC review whenever a request 

for reasonableness review is submitted. 

That difference between ‘‘opt-in’’ and 

‘‘opt-out’’ will have a significant effect 

on the queue for OGC reasonableness 

reviews and the time that attorneys, 

agents, and claimants must wait to 

receive their earned fees and benefits. 

The final rule is preferable on that front. 


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Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 85059 

Finally, to the extent the commenters 

are seeking an avenue to waive the 60- 

day period, it is unclear that the benefit 

of such an avenue (fee release days or 

weeks earlier) outweighs the burden of 

carefully reviewing such a waiver to 

ensure that claimants have knowingly 

and voluntarily waived their appellate 

rights (to both OGC and Board review). 

We do not outright reject the idea, but 

think it is best to implement this final 

rule and then reassess. The final rule as 

it stands will, in many cases, reduce the 

time for fee receipt from 2.9 years on 

average (see data noted above) to 

approximately 60 days. 

Accordingly, VA makes no change in 

response to these comments. 

Comments on Consequences of This 

Rule 

One commenter stated that this rule 

could add to OGC’s inventory of fee 

reasonableness cases, because 

discharged agents or attorneys who 

worked on a case for years will not be 

satisfied with the provision of fees to a 

continuous agent or attorney under 

§ 14.636(i)(1)(i), or with a split fee under 

§ 14.636(i)(1)(ii), and will therefore 

request OGC review. Another 

commenter similarly predicted ‘‘more 

reasonableness reviews/appeals’’ under 

this rule. 

VA appreciates the comments, but 

disagrees that OGC will have a higher 

inventory under this rule. Currently, 

OGC reviews every direct-pay case 

involving multiple agents or attorneys, 

whether the parties desire that review or 

not. Under this rule, OGC will generally 

limit its review to cases where a party 

requests it. That is a dramatic 

difference, as it could divert up to 

77.5% of OGC’s incoming caseload (per 

the data presented above). The situation 

laid out by the first commenter— 

discharged agents or attorneys who 

provided extensive services on a case 

for years—may be the most common 

circumstance where (the parties have 

difficulty reaching a compromise and) 

OGC review is desired, but there are 

many situations (e.g., all representatives 

are from the same law firm; all 

representatives reach an agreement to 

re-allocate fees upon release; all 

representatives are fine with the default 

allocation) where OGC review will no 

longer be needed under this rule. This 

efficiency gain will enable both 

representatives and veterans to receive 

their fees and benefits faster. 

The first commenter further stated 

that this rule could incentivize 

claimants ‘‘to terminate representation 

when they anticipate a favorable 

decision,’’ and could disincentivize 

agents and attorneys from representing 

claimants with prior agent or attorney 

representation. The second commenter 

echoed the concern about a potential 

disincentive here. VA appreciates the 

comments, but sees no basis for such 

speculation. First, the prospect that a 

claimant could be so confident that a 

favorable decision is forthcoming, so 

knowledgeable about § 14.636(i)(1)(ii), 

and so manipulative as to terminate 

representation to take advantage of that 

provision, is extremely unlikely. This 

assessment is confirmed by another 

commenter, who stated that ‘‘the vast 

majority of the thousands of clients 

we’ve successfully represented before 

VA have been proven to be extremely 

honest and would never even think to 

purposely drop us as their legal 

representative in order to avoid having 

to pay our legal fee.’’ In any event, even 

in that extremely unlikely case of 

claimant manipulation, the attorney or 

agent at issue could simply file for OGC 

review to ensure receipt of a reasonable 

fee for the case. Second, even if VA 

decided not to enact this rule, that same 

‘‘incentive to terminate’’ would still 

exist, because terminating a 

representative before a decision renders 

the presumption of fee reasonableness 

inapplicable. Compare 38 CFR 

14.636(f)(1) with 38 CFR 14.636(f)(2). So 

this rule presents no meaningful 

incentive change for claimants. 

The same logic applies to the concern 

that agents and attorneys will not 

represent claimants with prior agent or 

attorney representation. Even if VA 

decided not to enact this rule, that same 

‘‘disincentive’’ already exists under 

current practice, because all direct-pay 

cases involving multiple agents or 

attorneys are currently referred to OGC 

for allocation of the fee. So, either way, 

agents and attorneys know that the fee 

in the case will have to account for the 

prior agent or attorney. If anything, 

when compared to current practice, the 

rule change promotes representation of 

claimants with prior agent or attorney 

representation, given the structure of the 

§ 14.636(i)(1)(i) default. 

Accordingly, VA makes no change in 

response to these comments. 

Comments on Fee Eligibility and 

Reasonableness 

One commenter stated that VA’s 

proposal unlawfully vests OGC with the 

authority to decide questions of fee 

eligibility in the first instance. 

Respectfully, that is a 

misunderstanding. Under this rule, 

§ 14.636(i)(1) is clear that ‘‘the agency of 

original jurisdiction that issued the 

decision’’ awarding past-due benefits— 

which is not OGC—‘‘shall decide 

whether the agents or attorneys who 

filed direct-pay fee agreements in the 

case are eligible for direct payment.’’ 

Moreover, § 14.636(i)(5) provides that 

OGC may address fee eligibility only ‘‘if 

no other agency of original jurisdiction 

has made a determination on that 

issue.’’ This language is substantively 

identical to VA’s previous regulatory 

language on the matter. VA is not 

expanding, or attempting to expand, the 

scope of OGC’s authority in this 

rulemaking. 

Another commenter stated that VA’s 

proposal ‘‘conflates’’ the concepts of 

entitlement to a fee and reasonableness 

of a fee, because the default rules 

assume fee entitlement for all agents 

and attorneys. Again, with respect, that 

is a misunderstanding. Under this rule, 

§ 14.636(i)(1) is clear that the agency of 

original jurisdiction that issued the 

decision awarding past-due benefits 

‘‘shall decide whether the agents or 

attorneys who filed direct-pay fee 

agreements in the case are eligible for 

direct payment’’; § 14.636(i)(1)(i) and (ii) 

also contain the ‘‘eligible for direct 

payment’’ caveat; and § 14.636(i)(2) 

provides that ‘‘direct payment eligibility 

determination[s]’’ are appealable to the 

Board. In sum, VA’s rule does not 

assume fee eligibility or entitlement for 

all agents and attorneys—it requires an 

agency of original jurisdiction finding of 

eligibility before an attorney or agent is 

included in the default allocation. 

The same commenter asserted that 

VA’s proposal ‘‘creates a default on 

reasonableness that conflicts with’’ 38 

U.S.C. 5904(a)(5). VA appreciates the 

comment, but, in 2019, VA addressed 

the interplay between section 5904(a)(5) 

(‘‘A fee that does not exceed 20 percent 

of the past due amount of benefits 

awarded on a claim shall be presumed 

reasonable.’’) and the holding of Scates 

v. Principi, 282 F.3d 1362, 1365–66 

(Fed. Cir. 2002) (discharged attorneys 

are only entitled to a fee based on 

quantum meruit that reflects their 

contribution to and responsibility for 

the benefits awarded). 84 FR 138, 151 

(2019). VA explained that the section 

5904(a)(5) presumption applied to 

continuous agents or attorneys whose 

fee does not exceed 20 percent of the 

past-due benefits awarded, while the 

Scates quantum meruit standard 

applied to discharged agents or 

attorneys. 84 FR at 151. VA 

incorporated that distinction in 38 CFR 

14.636(f)(1)–(2). See also Cox v. 

McDonough, 34 Vet. App. 112, 126 

(2021) (confirming that, per Scates, the 

fee reasonableness presumption does 

not apply when attorney is discharged), 

aff’d, 2023 WL 1846117 (Fed. Cir. 2023). 

This rule merely continues that 

distinction. As VA explained in the 


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preamble to its proposed rule, the 

default allocation for cases involving a 

(direct pay eligible) ‘‘continuous’’ agent 

or attorney is logical because that 

individual’s fee is presumed reasonable 

under § 14.636(f)(1); and the default 

allocation for cases where all agents or 

attorneys have been discharged is 

logical because the reasonableness 

presumption does not apply to those 

individuals—quantum meruit does, 

under Scates and § 14.636(f)(2). 88 FR at 

88,296. So, to the extent the commenter 

discerns a conflict between this rule and 

section 5904(a)(5), any such conflict 

would be based in the holding of Scates 

and the distinction laid out at 

§ 14.636(f)(1)–(2), not the provisions 

being instituted here. 

A third commenter asserted that a 

default allocation that includes a 

claimant ‘‘absent a concern raised by 

that individual is misplaced’’ given the 

presumption of fee reasonableness. 

Again, however, the default allocation 

that includes a claimant 

(§ 14.636(i)(1)(ii)) is only applicable 

when the presumption of fee 

reasonableness does not apply and 

quantum meruit does. In a quantum 

meruit setting, where discharged 

attorneys or agents bear the burden of 

proving the value of their services, 

Dobbs v. DePuy Orthopedics, Inc., 842 

F.3d 1045, 1050 (7th Cir. 2016); Turpin 

v. Anderson, 957 S.W. 2d 421, 427 

(Mo.App. 1997), there is nothing 

improper about (1) having a default 

allocation that effectively proposes a 

quantum meruit fee amount and (2) 

requiring discharged attorneys or agents 

to (negotiate with the other parties or) 

file with OGC if they believe they have 

earned more. 

Accordingly, VA makes no change in 

response to these comments. 

Comment on Non-Direct Pay 

Agreements 

One commenter suggested that VA’s 

proposal may have contained a ‘‘simple 

oversight’’ in not treating ‘‘a current 

legal representative with a valid nondirect pay fee agreement’’ as ‘‘a 

continuous agent or attorney (meaning 

that there would be no presumption that 

they deserve their entire legal 

fee). . . .’’ The commenter requested 

that VA pay no fee to discharged 

representatives if the claimant has a 

current legal representative with a valid 

non-direct pay fee agreement; 

alternatively, that VA institute a 

presumption that a discharged 

representative’s fee agreement has ‘‘no 

legal force’’ if ‘‘factors indicate that [the 

representative’s] work was 

unsuccessful’’; or, in the further 

alternative, that VA ‘‘simply stop’’ 

direct payment ‘‘in all cases.’’ 

VA appreciates the comment, but 

declines these requests. At the outset, as 

a technical matter, those with non-direct 

pay agreements do meet the definition 

of ‘‘continuous agent or attorney’’ in 

§ 14.636(i) as long as they provided 

representation that continued through 

the date of the decision awarding 

benefits. But they are not entitled to a 

‘‘presumption that they deserve their 

entire legal fee,’’ which could be 30, 33, 

or even 50 percent of the claimant’s 

past-due benefits. Indeed, in VA’s 

experience non-direct pay agreements 

hardly ever qualify for the statutory 

presumption of reasonableness: A 

review of 206 non-direct pay fee 

agreements received by OGC between 

February 15, 2023, and March 6, 2023, 

reflects that 204 of the agreements 

(99.03%) charged a fee over 20 percent 

of the past-due benefits awarded and 

therefore were ineligible for the 

presumption of reasonableness. 38 

U.S.C. 5904(a)(5). In contrast, direct pay 

agreements must charge a fee that does 

not exceed 20 percent of the past-due 

benefits awarded, 38 U.S.C. 5904(d)(1), 

and therefore are all eligible for the 

presumption of reasonableness, 38 

U.S.C. 5904(a)(5). Thus, direct pay and 

non-direct pay agreements do not 

always warrant identical treatment, and 

particularly when it comes to the 

default allocation rules, which—only 

implicated ‘‘[w]hen one or more directpay fee agreements has been filed’’—are 

primarily designed to facilitate efficient 

direct payment. 38 CFR 14.636(i)(1) 

(emphasis added). 

That said, as noted in the preamble to 

the proposed rule, the default allocation 

of § 14.636(i)(1)(ii) ‘‘accounts for the 

possibility that the claimant may have 

entered into a non-direct pay agreement 

with other agents or attorneys and may 

be personally responsible for paying 

those other agents or attorneys.’’ 88 FR 

at 88,296. So this rule does preserve a 

portion of the fee for agents and 

attorneys with non-direct pay fee 

agreements. If the agent or attorney with 

the non-direct pay fee agreement 

believes that portion is insufficient, they 

have 60 days to resolve the matter with 

the other parties on their own; if an 

agreement cannot be reached, they can 

request OGC reasonableness review. 

VA has considered the options 

presented by the commenter, including 

declining direct payment for discharged 

representatives, premising direct 

payment on a multi-factor test, or 

stopping direct payment altogether. But 

thousands of agents and attorneys and 

countless claimants still find value in 

direct payment, given (1) the relative 

certainty of collection it provides to 

agents and attorneys, (2) the 20 percent 

fee limitation it guarantees for 

claimants, and (3) the power imbalance 

and potential for confusion that arises 

when a representative privately 

attempts to collect a fee from a claimant. 

While this rule’s enactment of 

§ 14.636(h)(1)(iii) is itself evidence that 

VA is open to the prospect of declining 

direct payment in certain types of cases, 

VA is not willing—at this point—to 

abandon the direct payment option in 

the circumstances contemplated by the 

commenter (or to institute a potentially 

lengthy and subjective multi-factor test). 

Accordingly, VA makes no change in 

response to this comment. 

Comment on Rosinski and Snyder 

One commenter stated that the ‘‘cash 

payment’’ provision that VA proposed 

to relocate without change from 

§ 14.636(h)(1)(iii) to § 14.636(h)(1)(iv) 

‘‘directly conflicts’’ with Rosinski v. 

Wilkie, 32 Vet. App. 264 (2020), and 

Snyder v. Nicholson, 489 F.3d 1213 

(Fed. Cir. 2007). VA thanks the 

commenter for the comment, but its 

proposed rule did not contemplate a 

substantive change to this provision; it 

merely relocated the provision without 

change to make way for a new and 

unrelated direct-payment requirement. 

That said, upon review of the comment, 

VA has determined that the continued 

propriety and suitability of the cash 

payment provision in light of Rosinski 

and Snyder does warrant additional 

consideration and public comment, so 

VA will issue a proposed amendment to 

the provision in an upcoming 

rulemaking. In terms of the current 

rulemaking, however, VA did not 

inform the public that the substance of 

this provision was at issue, and VA 

received no other comments weighing 

in on this issue, so VA declines to make 

any changes to the current rulemaking 

in response to this comment. 

Questions About This Rule 

One commenter asked how VA will 

ensure that all affected parties will be 

provided a fee allocation notice, because 

(according to the commenter) ‘‘VA 

mailing irregularities are welldocumented.’’ Under this rule, VA 

‘‘shall issue’’ the fee allocation notice 

‘‘to the parties,’’ which includes ‘‘the 

claimant or appellant [and] any agent or 

attorney who represented the claimant 

or appellant in the case.’’ 38 CFR 

14.636(i), (i)(1). So, all affected parties 

will be provided notice. But VA 

declines to implement any distinct 

procedure from its ordinary notification 

processes, and the commenter has 

suggested no alternative procedures. 


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Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 85061 

The commenter also asked ‘‘what 

training and resources’’ will be provided 

to retrain affected employees and ‘‘what 

quality assurance will be implemented.’’ 

Suffice it to say here that training will 

be provided, procedures manuals will 

be updated, and quality review will be 

implemented. Because the commenter 

has not suggested any specific actions 

on that front, VA declines further 

comment on the matter. 

The commenter further asked how VA 

‘‘will handle waiver of prior attorneys in 

fee cases,’’ because (according to the 

commenter) a reasonableness review in 

the case of waiver ‘‘is unnecessary’’ and 

VA’s approach to waiver has been 

‘‘inconsistent[ ].’’ When an agent or 

attorney waives fees, VA will treat them 

as ineligible for direct payment (just like 

a pro bono agent or attorney) when 

applying the default rules of 

§ 14.636(i)(1)(i) and (ii) to the case. 

Finally, this commenter asked ‘‘what 

notice VA will issue to whom if it 

determines there has been no qualifying 

request for review, or no entitlement to 

fees,’’ because (according to the 

commenter) ‘‘VA routinely makes such 

findings erroneously.’’ As to ‘‘no 

entitlement,’’ as long as one ‘‘direct-pay 

fee agreement[ ] has been filed,’’ VA will 

provide notice to all parties of any 

determination of fee ineligibility. 38 

CFR 14.636(i)(1). As to ‘‘no qualifying 

request for review,’’ if no request for 

OGC review or appeal to the Board is 

timely filed, VA may release the fee 

without additional notice. 38 CFR 

14.636(i)(2). 

The above question relates to a 

comment by another commenter, who 

recalled a situation where VA 

overlooked their direct-pay fee 

agreement and the claimant thus 

received the entirety of the past-due 

benefits. If the rare circumstance arises 

where VA mistakenly overlooks a 

direct-pay fee agreement (or a timely 

request for OGC review) and releases the 

fee, the affected party should contact 

OGC, which could move to review the 

matter on its own initiative. 38 CFR 

14.636(i)(4). 

A different commenter asked whether 

‘‘there should be a route to address’’ the 

situation where veterans had to pay 

attorney fees from successful clear and 

unmistakable (CUE) claims pertaining to 

a Secretary of Veterans Affairs equitable 

relief decision on the issue of traumatic 

brain injury. Respectfully, this topic is 

outside of the scope of this rulemaking. 

This rulemaking does not address or 

amend any provisions regarding fees 

associated with CUE or equitable relief. 

VA thanks the commenters and makes 

no change in response to these 

questions. 

Severability 

The purpose of this section is to 

clarify VA’s intent with respect to the 

severability of provisions of this rule. 

Each provision of this rulemaking is 

capable of operating independently. If 

any provision of this rule is determined 

by judicial review or operation of law to 

be invalid, that partial invalidation will 

not render the remainder of this rule 

invalid. Likewise, if the application of 

any portion of this rule to a particular 

circumstance is determined to be 

invalid, VA intends that the rule remain 

applicable to all other circumstances. 

Executive Orders 12866, 13563, and 

14094 

Executive Orders (E.O.) 12866 and 

13563 direct agencies to assess the costs 

and benefits of available regulatory 

alternatives and, when regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, and other advantages; 

distributive impacts; and equity). E.O. 

13563 (Improving Regulation and 

Regulatory Review) emphasizes the 

importance of quantifying both costs 

and benefits, reducing costs, 

harmonizing rules, and promoting 

flexibility. Executive Order 14094 

(Modernizing Regulatory Review) 

supplements and reaffirms the 

principles, structures, and definitions 

governing contemporary regulatory 

review established in Executive Orders 

12866 and 13563. The Office of 

Information and Regulatory Affairs has 

determined that this rulemaking is not 

a significant regulatory action under 

E.O. 12866, as amended by Executive 

Order 14094. The Regulatory Impact 

Analysis associated with this 

rulemaking can be found as a 

supporting document at 

www.regulations.gov. 

Regulatory Flexibility Act 

The Secretary hereby certifies that 

this final rule will not have a significant 

economic impact on a substantial 

number of small entities as they are 

defined in the Regulatory Flexibility Act 

(5 U.S.C. 601–612). The basis for this 

certification is the fact that the rule will 

merely institute reasonable default rules 

for fee allocation and provide that 

agents and attorneys who have lost their 

VA accreditation collect any earned fees 

without VA assistance. These changes 

will not result in any loss of fees to 

which an agent or attorney is reasonably 

entitled, because, as noted above, any 

party dissatisfied with the default 

allocation in a given case can request 

OGC’s determination on reasonable fees 

in the case. Therefore, pursuant to 5 

U.S.C. 605(b), the initial and final 

regulatory flexibility analysis 

requirements of 5 U.S.C. 603 and 604 do 

not apply. 

Unfunded Mandates 

The Unfunded Mandates Reform Act 

of 1995 requires, at 2 U.S.C. 1532, that 

agencies prepare an assessment of 

anticipated costs and benefits before 

issuing any rule that may result in the 

expenditure by State, local, and tribal 

governments, in the aggregate, or by the 

private sector, of $100 million or more 

(adjusted annually for inflation) in any 

one year. This final rule will have no 

such effect on State, local, and tribal 

governments, or on the private sector. 

Paperwork Reduction Act 

This final rule includes a provision 

constituting a collection of information 

under the Paperwork Reduction Act of 

1995 (44 U.S.C. 3501–3521). The 

collection of information associated 

with this rulemaking has an assigned 

OMB control number of 2900–0605 

requiring a reinstatement. A 

reinstatement of this collection of 

information requires review and 

approval by the Office of Management 

and Budget (OMB). Accordingly, under 

44 U.S.C. 3507(d), VA has submitted a 

copy of this rulemaking action to OMB 

for review and approval. VA received no 

comments on the collection of 

information requiring reinstatement. 

OMB has received the collection of 

information for reinstatement. OMB’s 

receipt of the collection of information 

for reinstatement is not an approval to 

conduct or sponsor an information 

collection under the Paperwork 

Reduction Act of 1995. In accordance 

with 5 CFR 1320, the collection of 

information reinstatement associated 

with this rulemaking is not approved by 

OMB at this time. OMB’s approval of 

the collection of information 

reinstatement will occur within 30 days 

after the Final rulemaking publishes. If 

OMB does not approve the collection of 

information reinstatement as requested, 

VA will immediately remove the 

provision containing the collection of 

information or take such other action as 

is directed by OMB. 

The collection of information 

contained in 38 CFR 14.629 and 14.636 

is described immediately following this 

paragraph, under its respective title. 

Title: Application for Accreditation as 

a Claims Agent or Attorney, Filing of 

Representatives’ Fee Agreements and 

Motions for Review of Such Fee 

Agreements. 

OMB Control No: 2900–0605. 


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85062 Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 

CFR Provisions: 38 CFR 14.636. 

• Summary of collection of 

information: 

(1) Applicants seeking accreditation 

as claims agents or attorneys to 

represent benefits claimants before VA 

must file VA Form 21a with OGC. The 

information requested in VA Form 21a 

includes basic identifying information, 

as well as certain information 

concerning training and experience, 

military service, and employment. 

(2) Accredited agents and attorneys 

must file with VA any agreement for the 

payment of fees charged for representing 

claimants before VA. 38 U.S.C. 

5904(c)(2); 38 CFR 14.636(g). 

(3) Claimants, accredited agents, or 

accredited attorneys may request an 

OGC determination on a reasonable fee 

allocation in a given case. If they do, 

OGC will solicit (optional) responses 

from the other parties in the case. 38 

U.S.C. 5904(c)(3); 38 CFR 14.636(i). 

• Description of need for information 

and proposed use of information: 

(1) The information in the VA Form 

21a is used by OGC to determine the 

applicant’s eligibility for accreditation 

as a claims agent or attorney. More 

specifically, it is used to evaluate 

qualifications, ensure against conflicts 

of interest, and to establish that 

statutory and regulatory eligibility 

requirements, e.g., good character and 

reputation, are met. 

(2) The information in recertifications 

is used by OGC to monitor whether 

accredited attorneys and agents 

continue to have appropriate character 

and reputation and whether they remain 

fit to prepare, present, and prosecute VA 

benefit claims. 

(3) The information in a fee agreement 

is used by the Veterans Benefits 

Administration (VBA) to associate the 

fee agreement with the claimant’s 

claims file, to potentially determine the 

attorney or agent’s fee eligibility, and to 

potentially process direct payment of a 

fee from the claimant’s past-due 

benefits. It is used by OGC to monitor 

whether the agreement is in compliance 

with laws governing paid 

representation, and to potentially 

review fee reasonableness. 

(4) The information in a request for 

OGC fee review, or a response to such 

request, is used by OGC to determine 

the agents’ or attorneys’ contribution to 

and responsibility for the ultimate 

outcome of the claimant’s claim, so that 

a determination on reasonable fees can 

be rendered. 

• Description of likely respondents: 

Claimants, Attorneys, Agents. 

• Estimated number of respondents: 

34,695. 

(1) For VA Form 21a applications, 

2,280. 

(2) For recertifications, 4,860. 

(3) For fee agreements, 27,250 (750 

first time filers and 26,500 repeat filers). 

(4) For requests for OGC fee review, 

305. 

Total estimated number of 

respondents (2,280, 4,860, 27,250, 305 = 

34,695). 

• Estimated frequency of responses: 

One time. 

• Estimated Completion Time: Varies 

as specified below. 

(1) For VA Form 21a applications, 45 

minutes. 

(2) For recertifications, 10 minutes. 

(3) For fee agreements, 1 hour for first 

time filers and 10 minutes for repeat 

filers. 

(4) For requests for OGC fee review, 

2 hours. 

• Total Annual Burden Hours: 8,297 

hours. 

(1) For VA Form 21a applications, 

1,710 hours. 

(2) For recertifications, 810 hours. 

(3) For fee agreements, 5,167 hours 

(750 hours for first time filers and 4,417 

hours for repeat filers). 

(4) For requests for OGC fee review, 

610 hours. 

Total estimated annual burden (1,710 

hours, 810, hours, 5,167 hours, 610 

hours = 8,297 hours). 

• Estimated cost to respondents per 

year: $633,349. 

(1) For VA Form 21a applications, 

$79,845 ($41,360 + $22,666 + $15,819). 

650 initial responses by attorneys ................................................ $84.84 × 487.5 hours (650 × 45 minutes/response) ................... $41,360.00 

960 initial responses by non-attorneys ......................................... $31.48 × 720 hours (960 × 45 minutes/response) ...................... 22,666.00 

670 follow-up responses by non-attorneys ................................... $31.48 × 502.5 hours (670 × 45 minutes/response) ................... 15,819.00 

(2) For recertifications, $68,720 (810 

hours × $84.84). 

(3) For fee agreements, $438,368 

(5,167 hours × $84.84). 

(4) For requests for OGC fee review, 

$46,416 ($43,268 + $3,148). 

255 responses by non-claimants .................................................. $84.84 × 510 hours (255 × 120 minutes/response) .................... $43,268.00 

50 responses by claimants ........................................................... $31.48 × 100 hours (50 × 120 minutes/response) ...................... 3,148.00 

Total estimated cost to respondents 

per year: ($79,845, $68,720, $438,368, 

$46,416 = $633,349). 

* To estimate the total information 

collection burden cost, VA used the 

May 2023. Bureau of Labor Statistics 

(BLS) average hourly wage codes of 23– 

1011: Lawyers ($84.84) and 00–0000: 

All Occupations ($31.48) to derive PRA 

estimates. This information is available 

at https://www.bls.gov/oes/current/oes_

nat.htm. Please note numbers are 

subject to rounding for VA estimates. 

Congressional Review Act 

Pursuant to Subtitle E of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996 (known as the 

Congressional Review Act) (5 U.S.C. 801 

et seq.), the Office of Information and 

Regulatory Affairs designated this rule 

as not satisfying the criteria under 5 

U.S.C. 804(2). 

List of Subjects in 38 CFR Part 14 

Administrative practice and 

procedure, Claims, Courts, Foreign 

relations, Government employees, 

Lawyers, Legal services, Organization 

and functions (Government agencies), 

Reporting and recordkeeping 

requirements, Surety bonds, Trusts and 

trustees, Veterans. 

Signing Authority 

Denis McDonough, Secretary of 

Veterans Affairs, approved and signed 

this document on October 17, 2024, and 

authorized the undersigned to sign and 

submit the document to the Office of the 

Federal Register for publication 

electronically as an official document of 

the Department of Veterans Affairs. 

Jeffrey M. Martin, 

Assistant Director, Office of Regulation Policy 

& Management, Office of General Counsel, 

Department of Veterans Affairs. 

For the reasons stated in the 

preamble, the Department of Veterans 

Affairs amends 38 CFR part 14 as set 

forth below: 


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Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 85063 

PART 14—LEGAL SERVICES, 

GENERAL COUNSEL, AND 

MISCELLANEOUS CLAIMS 

■ 1. The authority citation for part 14 

continues to read as follows: 

Authority: 5 U.S.C. 301; 28 U.S.C. 2671– 

2680; 38 U.S.C. 501(a), 512, 515, 5502, 5901– 

5905; 28 CFR part 14, appendix to part 14, 

unless otherwise noted. 

■ 2. Amend § 14.636 by: 

■ a. Removing paragraph (c)(4); 

■ b. Revising paragraphs (e), (g)(3), and 

(h)(1)(ii) and (iii); 

■ c. Adding paragraph (h)(1)(iv); and 

■ d. Revising paragraphs (i) through (k). 

The revisions read as follows: 

§ 14.636 Payment of fees for 

representation by agents and attorneys in 

proceedings before Agencies of Original 

Jurisdiction and before the Board of 

Veterans’ Appeals. 

* * * * * 

(e) Fee reasonableness factors. Fees 

set forth in a fee agreement, charged, or 

received for the services of an agent or 

attorney admitted to practice before VA 

must be reasonable. They may be based 

on a fixed fee, hourly rate, a percentage 

of benefits recovered, or a combination 

of such bases. Factors considered in 

determining whether fees are reasonable 

include: 

(1) The extent and type of services the 

agent or attorney performed; 

(2) The complexity of the case; 

(3) The level of skill and competence 

required of the agent or attorney in 

giving the services; 

(4) The amount of time the agent or 

attorney spent on the case; 

(5) The results the agent or attorney 

achieved, including the amount of any 

benefits recovered; 

(6) The level of review to which the 

claim was taken and the level of the 

review at which the agent or attorney 

was retained; 

(7) Rates charged by other agents or 

attorneys for similar services; 

(8) Whether, and to what extent, the 

payment of fees is contingent upon the 

results achieved; 

(9) If applicable, the reasons why an 

agent or attorney was discharged or 

withdrew from representation before the 

date of the decision awarding benefits; 

and 

(10) If applicable, the fee entitlement 

of another agent or attorney in the case. 

* * * * * 

(g) * * * 

(3) A copy of a direct-pay fee 

agreement, as defined in paragraph 

(g)(2) of this section, must be filed with 

the agency of original jurisdiction 

within 30 days of its execution. A copy 

of any fee agreement that is not a directpay fee agreement must be filed with the 

Office of the General Counsel within 30 

days of its execution by mailing the 

copy to the following address: Office of 

the General Counsel (022D), Department 

of Veterans Affairs, 810 Vermont 

Avenue NW, Washington, DC 20420. 

Only fee agreements that do not provide 

for the direct payment of fees, 

documents related to review of fees 

under paragraph (i) of this section, and 

documents related to review of expenses 

under § 14.637, may be filed with the 

Office of the General Counsel. All 

documents relating to the adjudication 

of a claim for VA benefits, including any 

correspondence, evidence, or argument, 

must be filed with the agency of original 

jurisdiction, Board of Veterans’ Appeals, 

or other VA office as appropriate. VA 

may accept fee agreements that were not 

filed within 30 days of execution upon 

a showing of sufficient cause. 

(h) * * * 

(1) * * * 

(ii) The amount of the fee is 

contingent on whether or not the claim 

is resolved in a manner favorable to the 

claimant or appellant, 

(iii) The agent or attorney is 

accredited (see §§ 14.627(a) and 

14.629(b)) on the date of VA’s fee 

allocation notice (see paragraph (i) of 

this section), and 

(iv) The award of past-due benefits 

results in a cash payment to a claimant 

or an appellant from which the fee may 

be deducted. (An award of past-due 

benefits will not always result in a cash 

payment to a claimant or an appellant. 

For example, no cash payment will be 

made to military retirees unless there is 

a corresponding waiver of retirement 

pay. (See 38 U.S.C. 5304(a) and 38 CFR 

3.750)) 

* * * * * 

(i) Fee review. For purposes of this 

paragraph (i), ‘‘party’’ means the 

claimant or appellant or any agent or 

attorney who represented the claimant 

or appellant in the case; ‘‘eligible for 

direct payment’’ means eligible for 

direct payment of a fee under the 

requirements of paragraphs (c), (g), and 

(h) of this section; ‘‘continuous agent or 

attorney’’ means the agent or attorney 

who provided representation that 

continued through the date of the 

decision awarding benefits; and ‘‘timely 

filed’’ means within 60 days of the fee 

allocation notice. 

(1) When one or more direct-pay fee 

agreements has been filed in accordance 

with paragraph (g) of this section and a 

decision awards past-due benefits in a 

case, the agency of original jurisdiction 

that issued the decision shall issue to 

the parties a fee allocation notice. The 

fee allocation notice shall decide 

whether the agents or attorneys who 

filed direct-pay fee agreements in the 

case are eligible for direct payment, and 

shall provide one of two default fee 

allocations: 

(i) In cases where a continuous agent 

or attorney is eligible for direct 

payment, the default shall be allocation 

of the fee to the continuous agent or 

attorney. 

(ii) In cases where paragraph (i)(1)(i) 

of this section does not apply, the 

default shall be an equal split of the fee 

based on the number of agents or 

attorneys who are eligible for direct 

payment plus the claimant or appellant. 

(2) A party that disagrees with the 

default fee allocation in a given case 

may file a request for Office of the 

General Counsel fee review, as provided 

in paragraph (i)(3) of this section. A 

party that disagrees with a direct 

payment eligibility determination may 

only appeal to the Board of Veterans’ 

Appeals. Absent a timely filed request 

for Office of the General Counsel fee 

review or a timely filed appeal to the 

Board of Veterans’ Appeals, the default 

fee allocation described in paragraphs 

(i)(1)(i) and (ii) of this section is final 

and VA may release the fee. 

(3) A request for Office of the General 

Counsel fee review under this paragraph 

(i) must be filed electronically in 

accordance with the instructions on the 

Office of the General Counsel’s website, 

or at the following address: Office of the 

General Counsel (022D), 810 Vermont 

Avenue NW, Washington, DC 20420. 

The request must include the names of 

the veteran and all parties, the 

applicable VA file number, and the date 

of the decision awarding benefits. The 

request must set forth the requestor’s 

proposal as to reasonable fee allocation, 

and the reasons therefor, and must be 

accompanied by all argument and 

evidence the requestor desires to 

submit. 

(4) Upon the receipt of a timely filed 

request under paragraph (i)(3) of this 

section, or upon his or her own 

initiative, the Deputy Chief Counsel 

with subject-matter jurisdiction will 

initiate the Office of the General 

Counsel’s motion for a fee review by 

sending notice to the parties. Not later 

than 30 days from the date of the 

motion, any party may file a response, 

with all argument and evidence the 

party desires to submit, electronically in 

accordance with the instructions on the 

Office of the General Counsel’s website, 

or at the following address: Office of the 

General Counsel (022D), 810 Vermont 

Avenue, NW, Washington, DC 20420. 

Such responses must be served on all 

other parties. The Deputy Chief Counsel 


ddrumheller on DSK120RN23PROD with RULES1
85064 Federal Register / Vol. 89, No. 207 / Friday, October 25, 2024 / Rules and Regulations 

1 84 FR 11198 (March 25, 2019). 

2 83 FR 61346, at 61357 (November 29, 2018) 

(proposed conditional approval), finalized at 84 FR 

11198, at 11205–11206. 

3Association of Irritated Residents v. EPA, 10 

F.4th 937 (9th Cir. 2021). 

with subject-matter jurisdiction may, for 

a reasonable period upon a showing of 

sufficient cause, extend the time for any 

party’s response. 

(5) The General Counsel or his or her 

designee shall render the Office of the 

General Counsel’s decision on the 

matter. The decision will be premised 

on the reasonableness factors of 

paragraph (e) of this section, the 

standards of paragraph (f) of this 

section, the limitation on direct 

payment of paragraph (h)(1)(i) of this 

section, the claims file, the parties’ 

submissions, and all relevant factors. 

The decision may address the issue of 

fee eligibility if no other agency of 

original jurisdiction has made a 

determination on that issue. 

(6) The Office of the General 

Counsel’s decision is a final 

adjudicative action that may only be 

appealed to the Board of Veterans’ 

Appeals. Unless a party files a Notice of 

Disagreement with the Office of the 

General Counsel’s decision, the parties 

must allocate any excess payment in 

accordance with the decision not later 

than the expiration of the time within 

which the Office of the General 

Counsel’s decision may be appealed to 

the Board of Veterans’ Appeals. 

(j) Failure to comply. In addition to 

whatever other penalties may be 

prescribed by law or regulation, failure 

to comply with the requirements of this 

section may result in proceedings under 

§ 14.633 to terminate the agent’s or 

attorney’s accreditation to practice 

before VA. 

(k) Appeals. Except as otherwise 

provided in this section, appeals shall 

be initiated and processed using the 

procedures in 38 CFR part 20 applicable 

to appeals under the modernized 

system. 

[FR Doc. 2024–24708 Filed 10–24–24; 8:45 am] 

BILLING CODE 8320–01–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 52 

[EPA–R09–OAR–2024–0338; FRL–12118– 

03–R9] 

Interim Final Determination To Stay or 

Defer Sanctions; California; San 

Joaquin Valley Unified Air Pollution 

Control District 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Interim final determination. 

SUMMARY: The Environmental Protection 

Agency (EPA) is making an interim final 

determination that the State of 

California has submitted revisions to the 

California State Implementation Plan 

(SIP) that correct the deficiency 

prompting the partial disapproval of 

previous SIP submissions addressing 

the requirements under the Clean Air 

Act (CAA or ‘‘Act’’) for contingency 

measures for the 2008 ozone national 

ambient air quality standards (NAAQS 

or ‘‘standards’’) for the San Joaquin 

Valley ozone nonattainment area. This 

determination is based upon a proposed 

conditional approval, published 

elsewhere in this issue of the Federal 

Register, of SIP revisions addressing the 

contingency measure requirements for 

the 2008 ozone NAAQS for the San 

Joaquin Valley. The effect of this interim 

final determination is to stay the 

application of the offset sanction and to 

defer the application of the highway 

sanction that were triggered by the 

EPA’s previous partial disapproval of 

SIP revisions submitted to address the 

contingency measure requirements for 

the 2008 ozone NAAQS for this area. 

DATES: This interim final determination 

is effective on October 25, 2024. 

However, comments will be accepted on 

or before November 25, 2024. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–R09– 

OAR–2024–0338 at https://

www.regulations.gov. For comments 

submitted at Regulations.gov, follow the 

online instructions for submitting 

comments. Once submitted, comments 

cannot be edited or removed from 

Regulations.gov. The EPA may publish 

any comment received to its public 

docket. Do not submit electronically any 

information you consider to be 

Confidential Business Information (CBI) 

or other information whose disclosure is 

restricted by statute. Multimedia 

submissions (audio, video, etc.) must be 

accompanied by a written comment. 

The written comment is considered the 

official comment and should include 

discussion of all points you wish to 

make. The EPA will generally not 

consider comments or comment 

contents located outside of the primary 

submission (i.e., on the web, cloud, or 

other file sharing system). For 

additional submission methods, please 

contact the person identified in the FOR

FURTHER INFORMATION CONTACT section. 

For the full EPA public comment policy, 

information about CBI or multimedia 

submissions, and general guidance on 

making effective comments, please visit 

https://www.epa.gov/dockets/ 

commenting-epa-dockets. If you need 

assistance in a language other than 

English or if you are a person with a 

disability who needs a reasonable 

accommodation at no cost to you, please 

contact the person identified in the FOR

FURTHER INFORMATION CONTACT section. 

FOR FURTHER INFORMATION CONTACT: 

Andrew Ledezma, Air Planning Office 

(ARD–2), EPA Region IX, 75 Hawthorne 

Street, San Francisco, CA 94105, (415) 

972–3985, or by email at 

Ledezma.Andrew@epa.gov. 

SUPPLEMENTARY INFORMATION: 

Throughout this document, ‘‘we,’’ ‘‘us,’’ 

and ‘‘our’’ refer to the EPA. 

Table of Contents 

I. Background 

II. EPA Evaluation and Action 

III. Statutory and Executive Order Reviews 

I. Background 

In March 2019, the EPA took final 

action to approve, or conditionally 

approve, certain state implementation 

plan (SIP) revisions submitted by the 

State of California to meet CAA 

requirements for the 2008 ozone 

NAAQS in the San Joaquin Valley, 

California, ozone nonattainment area.1

Specifically, the EPA approved the base 

year emissions inventory, reasonable 

further progress (RFP) demonstration, 

and motor vehicle emissions budgets, 

and conditionally approved the 

contingency measure element for the 

2008 ozone NAAQS. We justified a 

conditional approval of the contingency 

measure element, even though the 

contingency measure itself would only 

achieve a small fraction of the 

recommended amount for contingency 

measures, on the basis of a surplus in 

emissions reductions that could be 

anticipated from already-implemented 

measures in the milestone years and 

year after the attainment year and a 

commitment by the State to achieve 

additional emissions reductions by the 

attainment year in the San Joaquin 

Valley that would reduce the chances 

that additional contingency measures 

would be needed for failure to attain the 

2008 ozone NAAQS by the applicable 

attainment date.2

Our final conditional approval of the 

contingency measure element was the 

subject of a legal challenge and, in a 

2021 Ninth Circuit decision in the 

Association of Irritated Residents v. EPA 

case, the Court remanded the 

conditional approval action back to the 

Agency.3 In so doing, the Court found 

that, by taking into account the 

emissions reductions from alreadyimplemented measures to find that the 

contingency measure would suffice to 


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