[Federal Register Volume 60, Number 69 (Tuesday, April 11, 1995)]
[Rules and Regulations]
[Pages 18354-18356]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-8887]



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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Parts 2 and 3

RIN 2900-AH36


Veterans' Benefits Improvements Act of 1994: To Implement 
Provisions of Public Law 103-446

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends Department of Veterans Affairs (VA) 
adjudication regulations to: Allow the election of death pension by 
surviving spouses in receipt of dependency and indemnity compensation 
(DIC); eliminate the requirement to pay certain benefits in Philippine 
pesos; revise the treatment of certain claims after a renouncement of 
benefits; and exclude from countable income in the pension and parents' 
DIC programs certain income of Alaska natives. These changes are needed 
to implement recently enacted legislation. The intended effect of these 
changes is to bring the regulations into conformance with the new 
statutory requirements.

EFFECTIVE DATE: These amendments are effective November 2, 1994, the 
date that Public Law 103-446 was signed into law, except for the 
provisions removing the requirement to pay certain benefits in 
Philippine pesos (38 CFR 2.67a, 3.8, 3.100(b), 3.251(a)(3), and 3.1600) 
which are effective January 1, 1995.

FOR FURTHER INFORMATION CONTACT: Paul Trowbridge, Consultant, 
Regulations Staff (211B), Compensation and Pension Service, Veterans 
Benefits Administration, 810 Vermont Avenue NW., Washington, DC 20420, 
telephone (202) 273-7210.

SUPPLEMENTARY INFORMATION: On November 2, 1994, the Veterans' Benefits 
Improvements Act of 1994 was signed into law. Formerly, no person in 
receipt of DIC could elect to receive any other benefit based on the 
same death. Section 111 of the Veterans' Benefits Improvements Act of 
1994, Public Law 103-446, amended 38 U.S.C. 1317 to allow a surviving 
spouse in receipt of DIC to elect death pension instead of such 
compensation. VA is amending 38 CFR 3.5(c) and 3.702(d) to conform with 
this new statutory provision. We have also made a nonsubstantive change 
in Sec. 3.702(d) to clarify when an election of DIC is final.
    Under the provisions of 38 U.S.C. 5306 any person can renounce a 
benefit to which he or she is entitled. Until recently any new 
application filed thereafter was treated as an original application. 
Section 503 of Public Law 103-446 amended 38 U.S.C. 5306 by adding a 
new subsection which provides that a new application for pension or 
parents' DIC filed within one year after renouncement of that benefit 
shall not be treated as an original application but rather that any 
benefits due will be payable as if the renouncement has not occurred. 
VA is amending 38 CFR 3.106 and 3.400(s) to conform to this new 
statutory requirement.
    All income is countable when VA determines entitlement to income-
based benefits unless specifically excluded by law. Section 506 of 
Public Law 103-446 provides a new exception to countable income if 
cash, stock, land, or other interests are received by an individual 
from a Native Corporation under the Alaska Native Claims Settlement Act 
(43 U.S.C. 1601 et seq.). VA is amending 38 CFR 3.261, 3.262 and 3.272 
to conform to this new statutory requirement.
    Section 507 of Public Law 103-446 amended 38 U.S.C. 107 to 
eliminate the requirement that compensation, DIC, or burial allowance 
based on certain Philippine service deemed not to be active service for 
other purposes be paid in Philippine pesos. VA is amending 38 CFR 3.8, 
3.251(a)(3), and 3.1600 to conform to this statutory revision. VA is 
removing Secs. 2.67a and 3.100(b) because, in light of the statutory 
amendment, calculation of the annual income limitation in Philippine 
pesos is not required and a delegation of authority to the Chief 
Benefits Director for that purpose is no longer necessary.
    VA is issuing a final rule to make the above described amendments. 
These [[Page 18355]] amendments are necessary to conform regulatory 
provisions with Public Law 103-446. Because these amendments merely 
restate statutory changes, publication as a proposal for public comment 
is unnecessary.
    Administrative Procedure Act: This final rule merely restates 
statutory changes contained in Public Law 103-446. Accordingly, 
pursuant to 5 U.S.C. 553, there is a basis for dispensing with prior 
notice and comment on this final rule and dispensing with a 30-day 
delay of its effective date.
    Regulatory Flexibility Act: Because no notice of proposed 
rulemaking was required in connection with the adoption of this final 
rule, no regulatory flexibility analysis is required under the 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.).


    The Catalog of Federal Domestic Assistance program numbers are 
64.101, 64.104, 64.105, 64.109, and 64.110.

List of Subjects

38 CFR Part 2

    Authority delegations (Government agencies), Veterans Affairs 
Department.

38 CFR Part 3

    Administrative practice and procedure, Claims, Health care, 
Individuals with disabilities, Pensions, Veterans.

    Approved: March 31, 1995.
Jesse Brown,
Secretary of Veterans Affairs.
    For the reasons set out in the preamble, 38 CFR parts 2 and 3 are 
amended as set forth below:

PART 2--DELEGATIONS OF AUTHORITY

    1. The authority citation for part 2 continues to read as follows:

    Authority: 38 U.S.C. 501, 512(a), unless otherwise noted.


Sec. 2.67a  [Removed]

    2. Section 2.67a is removed.

PART 3--ADJUDICATION

Subpart A--Pension, Compensation, and Dependency and Indemnity 
Compensation

    1. The authority citation for part 3, subpart A, continues to read 
as follows:

    Authority: 38 U.S.C. 501(a), unless otherwise noted.


Sec. 3.5  [Amended]

    2. In Sec. 3.5(c) change the period after ``Affairs'' to a comma 
and add the following: ``except that, effective November 2, 1994, a 
surviving spouse who is receiving dependency and indemnity compensation 
may elect to receive death pension instead of such compensation.''


Sec. 3.8  [Amended]

    3. In Sec. 3.8(b) and Sec. 3.8(c)(1) remove ``in Philippine pesos 
equivalent to'' and add ``of'', in its place.
    4. In Sec. 3.8(e) remove ``a peso basis'' and add, in its place, 
``a $0.50 for each dollar authorized basis''. Remove ``payable in 
pesos.'' and add, in its place, ``payable at the rate of $0.50 for each 
dollar authorized.''


Sec. 3.100  [Amended]

    5. Section 3.100(b) is removed. Redesignate Sec. 3.100(c) as 
Sec. 3.100(b).
    6. In Sec. 3.106, redesignate paragraphs (c) and (d) as paragraphs 
(d) and (e), respectively. Add a new paragraph (c) to read as follows:


Sec. 3.106  Renouncement.

* * * * *
    (c) Notwithstanding the provisions of paragraph (b) of this 
section, if a new application for pension or parents' dependency and 
indemnity compensation is filed within one year after the date that the 
Department of Veterans Affairs receives a renouncement of that benefit, 
such application shall not be treated as an original application and 
benefits will be payable as if the renouncement had not occurred.

(Authority: 38 U.S.C. 5306(c))


Sec. 3.251  [Amended]

    7. In Sec. 3.251(a)(3), remove ``computed'' and ``in Philippine 
pesos equivalent''.
    8. In Sec. 3.261, paragraph (a)(39) is added to read as follows:


Sec. 3.261  Character of income; exclusions and estates.

* * * * *
    (a) Income
* * * * *

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                                                                                          Pension; old-law    Pension; section 306                      
                                                                Dependency and          (veterans, surviving  (veterans, surviving                      
             Income               Dependency (parents)  indemnitycompensation(parents)       spouses and           spouses and              See--       
                                                                                              children)             children)                           
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(39) Cash, stock, land or other   Excluded............  Excluded......................  Excluded............  Excluded............  Sec. 3.262(x).      
 interests received from a                                                                                                                              
 Native Corporation under the                                                                                                                           
 Alaska Native Claims Settlement                                                                                                                        
 Act (43 U.S.C. 1601 et seq.).                                                                                                                          
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * *
    9. In Sec. 3.262, paragraph (x) and its authority citation are 
added as follows:


Sec. 3.262  Evaluation of income.

* * * * *
    (x) Alaska Native Claims Settlement Act. There shall be excluded 
from income computation any cash (including cash dividends on stock 
received from a Native Corporation) to the extent that it does not, in 
the aggregate, exceed $2,000 per individual per annum; stock (including 
stock issued or distributed by a Native Corporation as a dividend or 
distribution on stock); a partnership interest; land or an interest in 
land (including land or an interest in land received from a Native 
Corporation as a dividend or distribution on stock); and an interest in 
a settlement trust. (November 2, 1994)

(Authority: Sec. 506, Pub. L. 103-446)

    10. In Sec. 3.272, paragraph (t) and its authority citation are 
added as follows:


Sec. 3.272  Exclusions from income.

* * * * *
    (t) Alaska Native Claims Settlement Act. Any receipt by an 
individual of cash (including cash dividends on stock received from a 
Native Corporation) to the extent that it does not, in the aggregate, 
exceed $2,000 per individual per annum; stock (including stock issued 
or distributed by a Native Corporation as a dividend or distribution on 
stock); a partnership interest; land or an interest in land (including 
land or an interest in land [[Page 18356]] received from a Native 
Corporation as a dividend or distribution on stock); and an interest in 
a settlement trust. (November 2, 1994)

(Authority: Sec. 506, Pub. L. 103-446)


Sec. 3.400  [Amended]

    11. In Sec. 3.400(s), remove ``Date'' and add, in its place, 
``Except as provided in Sec. 3.106(c), date''.
    12. In Sec. 3.702, paragraph (d) is revised as follows:


Sec. 3.702  Dependency and indemnity compensation.

* * * * *
    (d) Finality of election.
    (1) Except as noted in paragraph (d)(2), an election to receive 
dependency and indemnity compensation is final and the claimant may not 
thereafter reelect death pension or compensation in that case. An 
election is final when the payee (or the payee's fiduciary) has 
negotiated one check for this benefit or when the payee dies after 
filing an election but prior to negotiation of a check.
    (2) Notwithstanding the provisions of paragraph (d)(1), effective 
November 2, 1994, a surviving spouse who is receiving dependency and 
indemnity compensation may elect to receive death pension instead of 
such compensation.

(Authority: 38 U.S.C. 1317)
* * * * *


Sec. 3.1600  [Amended]

    13. In Sec. 3.1600, paragraphs (a), (b), and (f), remove the words 
``in Philippine pesos''.

[FR Doc. 95-8887 Filed 4-10-95; 8:45 am]
BILLING CODE 8320-01-P